Canada v. Armstrong
A-189-95
Stone J.A.
10/5/96
13 pp.
Application for judicial review of Tax Court's judgment respondent could deduct payments made to discharge monthly mortgage obligation including taxes and arrears with respect to matrimonial home-Respondent and wife separated March 1987-In divorce proceedings, order made August 1987 respondent to pay monthly mortgage obligation on matrimonial home-November 1991, further order made ordering respondent to pay mortgage and municipal taxes and tax arrears-Appeal allowed-Deeming provision employed by Parliament at end of s. 60.1(2) applies only "where the decree, order, judgment or written agreement provides that this subsection and section 56.1(2) shall apply"-No such language appears in either order, therefore cannot apply-Also cannot be said that later order "continued" obligation of earlier order-Second order providing for payment of municipal taxes and tax arrears in addition to monthly mortgage payment-S. 60.1(1) not expressly incorporating definition of "allowance" in s. 56(12)-Does, however, restrict application to periodic payment of amount by taxpayer provided for in "decree, order, judgment or written agreement described in paragraphs 60(b), (c) or (c.1), or any variation thereof", made after May 6, 1974-Must read qualifying words "as alimony or other allowance" or "as an allowance" in particular context within those paragraphs for full descriptions of "decree, order, judgment or written agreement" referred to in s. 60.1(1)-This descriptive language absent from s. 60.1(1)-Further, definition of "allowance" in s. 56(12) adopted expressly "for purposes of paragraph . . . 60(b), (c) and (c.1)"-S. 60.1(1) not itself providing for deduction of amount paid and received-Instead, enlarges right of deduction under s. 60(b), (c) and (c.1) by deeming for purposes of those paragraphs, an amount "to have been paid and received by that person"-As former spouse having no discretion as to use of moneys, cannot be deducted by respondent-If result no payments made "for benefit" of spouse can be left to discretion of spouse as to use and therefore never deductible, problem only Parliament can solve by changing clear language of statute-Garnisheed manner in which payments made not resulting in discretion in hands of receiving spouse-Income Tax Act, R.S.C., 1985 (5th Supp.), c. 1, ss. 56(12) (as enacted by S.C. 1988, c. 55, s. 34(6)), 56.1 (as am. idem s. 35(1)), 60.1(1),(2) (as am. idem, 38(2)).