Canada v. Continental Bank of Canada
A-540-94
Linden J.A.
4/6/96
6 pp.
Appeal by Crown from Tax Court's judgment reassessing respondent's 1987 taxation year and finding disposition of partnership interest capital gain, not income-Cross-appeal by respondent of Tax Court's finding disposition of notes and debentures income-In deciding whether transaction adventure in nature of trade, Court must look to substance in broader context in which transaction performed-Must look at intention of parties, whether conduct similar to that of ordinary trader, nature and quantity of property in question, whether transaction isolated and uniqueness of transaction when compared to taxpayer's ordinary activities-Sale of partnership not speculative endeavour meant to generate income profit as clear by context in which sale executed-Sale one component of composite transaction designed to wind up respondent's affairs-Gain on capital account-Appeal dismissed-With respect to cross-appeal, transaction giving rise to gain in ordinary course of respondent's business-Even though property disposed of part of capital transaction, manner in which disposed of determines character-Crossappeal dismissed.