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TMI Blog1953 (2) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... the three applicants for incorporation "as well as other persons who are or may become members of the corporation." Among the purposes for which it was incorporated were the following:― 1. To purchase, assume, take over or otherwise acquire, all or part of the assets, rights, franchises, concessions, privileges, and to succeed to the business known under the name "DOMINION TAXICAB ASSOCIATION" by acquiring all or any part of the assets, with the goodwill and all rights and contracts passed with the said "DOMINION TAXICAB ASSOCIATION." * * * 3. To found, maintain, establish, services likely to benefit members of the Association. * * * 8. To purchase, rent or otherwise acquire, all or any part of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... la Dominion Taxicab Association lors de son départ, à moins que les deux signataires des présentes consentent mutuellement au transfert dudit dépôt à un nouvel acquéreur. La Dominion Taxicab Association s'engage à considérer ce droit d'entrée comme un dépôt sur lequel un intérêt pourra être payé quand le Bureau de Direction le jugera à propos. Je, soussigné, déclare avoir lu et bien compris les termes des présentes. …………………………………. Membre It is the submission of the respondent that the sum of $40,500 is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1949 ; but that as each deposit was received by the Association and became a part of its assets there arose a corresponding contingent liability equal in amount. The consideration moving from the member to the Association was not the outright payment to it of $500 but the deposit with it of that sum. While the contract fails to indicate with any precision the respective, rights of the parties in regard to the sum deposited and particularly fails to make clear the circumstances, if any, under which the member may require the return of such sum, all its terms appear to me to be inconsistent with the view that the Association acquired any absolute property in such sum. The second paragraph of the contract shews that two conditions had to be fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is distinguishable from Diamond Taxicab Association Ltd. v. Minister of National Revenue [1952] Ex. CR. 331; [1953] C.T.C. 104., affirmed in this Court without written reasons. In the circumstances of that case it was held that the sums there in question had been paid outright to the Association as part of the consideration for the services it rendered; no question of a deposit arose. For the above reasons I would allow the appeal with costs throughout and declare that no part of the said sum of $40,500 was assessable as income of the appellant in the taxation year in question. Rand J.:―The appellant was incorporated by letters patent of the province of Quebec and among the objects were:― 1. To purchase, assume, take over o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oth in the intention of the subscribers and of the corporation, furnished those funds. They were obviously to enable capital assets to be acquired and were limited in their application to that purpose. I am quite unable, therefore, to see how they can be held to be income. The case of Diamond Taxicab Association Limited v. M.N.R. [1952] Ex. CR. 331; [1953] C.T.C. 104., affirmed without reasons by this Court was decided on the facts there presented. It was held that the interpretation given them by the Exchequer Court, that the monies had been paid as commuted compensation for future services, had not been shown to be erroneous. I would therefore allow the appeal and set aside the assessment of the Minister with costs throughout. [1] [2] ..... X X X X Extracts X X X X X X X X Extracts X X X X
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