A-764-97
C.I. Mutual Funds Inc. in a Representative Capacity as Trustee(s) of a Certain Inter Vivos Trust Known as the C.I. Canadian Balance Fund Trust and Trimark Investment Management Inc. in a Representative Capacity as Trustee(s) of a Certain Inter Vivos Trust Known as the Trimark Fund Trust (Appellants)
v.
Her Majesty the Queen (Respondent)
Indexed as: C.I. Mutual Funds Inc.v. Canada (C.A.)
Court of Appeal, Linden, Létourneau and Sexton JJ.A. "Toronto, February 8 and 12, 1999.
Construction of statutes — Retroactivity — Appeal from T.C.C. decision amendments to Excise Tax Act applied to management fees paid to trustees/managers by mutual fund trusts between 1991, 1995 — Amendments to Act making GST payable on management, administrative fees of mutual fund trusts passed March 20, 1997 —deemed to have come into force on December 17, 1990— — Language sufficiently clear to rebut presumption against retroactive application — Legislation applicable to actions commenced after deemed coming into force date — Interpretation Act, s. 43 not preserving vested rights of trustees because (1) s. 43 dealing with repeal of enactments; (2) trustees had no vested rights.
Customs and Excise — Excise Tax Act — Appeal from T.C.C. decision management fees paid between 1991, 1995 by mutual fund trusts to trustees/managers subject to GST — (1) Amendments to Excise Tax Act —deemed to have come into force on December 17, 1990— expressly making GST payable on management, administrative fees of mutual fund trusts applicable — (2) Management fees subject to GST under old legislation — (i) ETA providing service provided in course of commercial activity subject to GST — Provision of management services by trustee to trust within definition of —commercial activity— — (ii) Trustees' services provided to mutual funds relating to management activities, not trustee activities, and subject to GST — (iii) Services provided by managers not exempt financial services — Definition of —financial services— in s. 123(1)(g) excluding services provided to trust, principal activity of which investing funds on behalf of other persons — —On behalf of— meaning —for benefit of— in mutual fund context — (3) Fees for costs of employees providing administrative services taxable; securities filing fees paid by managers as agents for trusts not subject to GST.
These were appeals from the Tax Court's finding that amendments to the Excise Tax Act applied to management fees paid to trustees by mutual fund trusts between 1991 and 1995.
The appellants were trustees and managers of large mutual fund trusts. They appealed in a representative capacity on behalf of the trusts. In return for the management of the trusts, the managers received management fees. The managers charged, and the trusts paid, GST on those amounts. The managers were also paid an administrative fee relating to salaries paid to administrative employees (i.e. employees not engaged in the business of managing or marketing the trusts) and securities commission filing fees. Appeals were commenced on March 22, 1996 to obtain a refund of GST mistakenly paid by the trusts on account of management and administrative fees. On April 23, 1996, the federal government proposed amendments to the Excise Tax Act which expressly made GST payable on the management and administrative fees of mutual fund trusts. Those amendments were passed on March 20, 1997, and were "deemed to have came into force on December 17, 1990".
The issues were: (1) whether the legislation applied retroactively to interfere with vested rights; (2) if not, whether the management fees were not subject to GST under the old legislation.
Held, the appeals should be dismissed, except that GST paid on securities commission filing fees should be refunded.
(1) A review of the case law regarding retroactive legislation disclosed that the test is whether the language is sufficiently clear to rebut the presumption against retroactive application. Parliament's language was amply clear. For the reasons given by the Tax Court, and because common sense suggests that provisions which are deemed to have come into force on a certain date apply to all actions which commenced after that date, the legislation applied to these actions as if that legislation had received Royal Assent on December 17, 1990.
Interpretation Act, section 43 did not operate to preserve the so-called vested rights of the trustees because section 43 deals with the repeal of an enactment. Regardless, the trustees had no vested rights.
(2) If the legislation did not operate retroactively, the management fees were subject to GST under the old legislation.
(i) The trustees argued that management fees were not subject to GST because the services were not rendered by a "person" for purposes of the ETA. The ETA explicitly provides that services which are rendered in any manner in the course of a commercial activity are taxable. The provision of management services by the trustee to the trust was a "commercial activity". CIMF and Trimark were engaged either in the business of providing management and administration services or in an adventure or concern in the nature of trade in the form of providing management and administrative services to the mutual fund trusts with the reasonable expectation of gaining a profit. Thus they fell within the definition of "commercial activity". The fact that the services were necessary to bring the trusts into existence, and for them to continue to exist was irrelevant.
(ii) The trustees submitted that their services were not taxable because they were rendered by an "officer" of the recipient. The trustees were not officers of the trusts for purposes of the ETA. The ETA intended to exclude the employer-employee relationship from the application of the GST. For this reason, ETA defines "officer" to include a series of individuals. The services provided to the mutual funds, on which the GST was calculated, related to management activities, not trustee activities. Even if the trustees were officers of the trusts, they were not performing duties as trustees, but as managers, and as such these activities were subject to GST.
(iii) The trustees argued that their services were not subject to GST because they were "financial services". The definition of "financial services" in paragraph 123(1)(g ) excludes the provision of management or administrative services to a trust, the principal activity of which is the investing of funds on behalf of other persons. The trustees submitted that, as trustees, they were not investing "on behalf of" anyone, but were investing their own funds. The services provided by the managers were not exempt financial services. "On behalf of" is equivalent to "for the benefit of" in the context of mutual funds. Any other interpretation would deprive the provision of any meaning.
(3) Finally, the trustees submitted that GST should not be payable on administrative fees because they were paid by the trusts themselves, or by the managers as agent for the trusts. Administrative fees representing the cost of employees who were responsible for trust administration were taxable. While these employees performed some functions which would otherwise have to be performed by the trustees, the administrative tasks performed by these employees were not limited to trustees' services. They performed functions which were integral to the smooth operation of the trusts. It did not matter that the managers charged administrative fees at cost, but charged management fees equal to a percentage of the holdings. The fees were charged for services provided, and were taxable.
Fees representing securities commission filing fees were not subject to GST because they were paid by the managers as agents for the trusts. The managers filed registrations with securities commissions on behalf of the trust, in the course of their professional activities, and were legally and professionally obliged to do so. These actions contained all the hallmarks of agency.
statutes and regulations judicially considered
Excise Tax Act, R.S.C., 1985, c. E-15, s. 123(1) "financial service" (as enacted by S.C. 1990, c. 45, s. 12; 1993, c. 27, s. 10; 1997, c. 10, s. 1), "officer" (as enacted by S.C. 1990, c. 45, s. 12).
Interpretation Act, R.S.C., 1985, c. I-21, c. 21, s. 43.
cases judicially considered
distinguished:
Esso Resources Canada Ltd. v. Canada, [1991] 1 C.T.C. 121; (1990), 3 T.C.T. 5132; 109 N.R. 272 (F.C.A.).
considered:
Rex v. Southampton Income Tax Commissioners. Ex parte Singer, [1916] 2 K.B. 249; A.-G. N.S. v. Davis, [1937] 3 D.L.R. 673 (N.S.S.C.); Hutchinson v. Jauncey, [1950] 1 K.B. 574 (C.A.); Western Minerals Ltd. v. Gaumont; Western Minerals Ltd. v. Brown and Beaver Sand & Gravel Ltd. (1951), 3 WWR (NS) 434 (Alta. S.C. App. Div.); Ferrell v. Canada, [1999] F.C.J. No. 102 (C.A.) (QL); affg (1997), 97 DTC 1565 (T.C.C.).
authors cited
Concise Oxford Dictionary of Current English, 8th ed. Oxford: Clarendon Press, 1990, "on behalf of".
Fridman, G. H. L. The Law of Agency, 7th ed. Toronto: Butterworths, 1996.
Harvey, Cameron. Agency Law Primer. Scarborough, Ont.: Carswell, 1993.
Sherman, David M. Canada GST Service. Scarborough, Ont.: Carswell, 1998.
APPEALS from Tax Court's finding that amendments to the Excise Tax Act making GST payable on management and administrative fees of mutual fund trusts "deemed to have come into force on December 17, 1990" applied to fees paid by the appellant trusts between 1991 and 1995 (C.I. World Bond Fund Trust v. Canada , [1997] T.C.J. No. 1080 (QL)). Appeals dismissed, except with respect to GST paid on securities commission filing fees.
appearances:
William I. Innes and Patrick J. Cotter for appellants.
Harry Erlichman and David E. Spiro for respondent.
solicitors of record:
Genest Murray DesBrisay Lamek, Toronto, for appellants.
Deputy Attorney General of Canada for respondent.
The following are the reasons for judgment rendered in English by
Linden J.A.:
INTRODUCTION
The issue in this case is whether the Excise Tax Act1 (ETA) applies so that the Goods and Services Tax (GST) is payable on management fees and administration fees charged by mutual fund managers to the mutual fund trusts which they manage. For the following reasons, and with one exception, I would find that it does.
FACTS
The appellants, C.I. Mutual Funds (CIMF) and Trimark Investment Management Inc. (TIMI) are the trustees, and, by agreement, managers of large mutual fund trusts. The appellants, hereinafter called the trustees, appeal in a representative capacity on behalf of the trusts.
In return for the management of the trusts, the managers receive management fees. The management fees paid by the Trimark trusts to TIMI from January 1, 1991 to April 1, 1995 were $395,264,684. The management fees paid by the C.I. trusts to CIMF during the same period were $118,962,630. The managers charged, and the trusts paid, GST on those amounts, in error they say. The trustees bring this action because Revenue Canada has refused to refund the amount of the GST paid.
The managers are also paid an administrative fee relating to salaries paid to administrative employees (i.e., employees not engaged in the business of managing or marketing the trusts) and securities commission filing fees. The trustees also seek a refund of GST paid mistakenly, they say, by the trusts on account of administrative fees. The appeals were commenced on March 22, 1996.
On April 23, 1996, about one month later, the federal government proposed amendments to the ETA which expressly made GST payable on the management and administrative fees of mutual fund trusts. Before this Court, counsel for the trustees described the amendments as having been directed at this issue, "as if they [the government] took our pleadings and amended on that basis, without mentioning us." That Bill, C-70, was passed by Parliament and received Royal Assent on March 20, 1997. The relevant portions of Bill C-70 affecting the trustees [section 1] "is [are] deemed to have come into force on December 17, 1990."2
ISSUES
The trustees raised three issues before this Court. First, the trustees argue that the legislation should not apply retroactively to interfere with vested rights. Second, if that is so, the trustees argue that the management fees are not subject to GST, because (a) services were not rendered by a "person" for purposes of the ETA, (b) services were rendered by an "officer" of the recipient, and (c) the services here are properly described as "financial service" as that term is defined in the ETA [subsection 123(1) (as enacted by S.C. 1990, c. 45, s. 12; S.C. 1997, c. 10, s. 1)]. Finally, the trustees argue that in any event GST should not be payable on administrative fees because those fees were paid by the trusts themselves, or, alternatively, by the managers as agent for the trusts.
ANALYSIS
1. Does the 1997 legislation apply retroactively?
If the 1997 legislation applies retroactively, then it is conceded that GST is payable on management fees regardless of the merits of the trustees' other arguments regarding the application of the wording in the pre-amendment ETA.
At the Tax Court of Canada, Rip J.T.C.C. held that the language used by Parliament was sufficiently clear to apply retroactively.3 He specifically held that there was no need for Parliament to specifically refer to pending litigation in order to affect the rights of litigants.4
While the trustees concede that there must be some retroactive application of this legislation, they argue that Parliament's use of bland and inconclusive language in a large, technical bill should not act to interfere with the rights of litigants whose appeals were in progress and specifically known to the government at the time the legislation was drafted.
Despite the able argument of counsel for the trustees, Mr. Innes, I am in substantial agreement with the thorough review of the jurisprudence and subsequent conclusions of Rip J.T.C.C. rejecting that argument. Parliament's language, that the sections "is [are] deemed to have come into force on December 17, 1990," is amply clear so as to rebut any presumption against retroactive application.
I will not attempt to reproduce the thorough review of jurisprudence undertaken by Rip J.T.C.C. I would, however, add one point which was ably made by Mr. Spiro, counsel for the respondent. A review of the jurisprudence regarding retroactive legislation leads to the conclusion that in different times and in different places those who draft retroactive legislation have chosen different styles with which to do so. For example, in Rex v. Southampton Income Tax Commissioners. Ex parte Singer, the legislative passage in question read that:
Notwithstanding anything in section one hundred and six or one hundred and forty six of the Income Tax Act, 1842, or in any other enactment relating to income tax, a person may be charged to income tax under Schedule D. or E., . . . and if any person has been so charged before the commencement of this Act, the charge shall not be deemed invalid by reason of that person not having been charged by the right commissioners.5 [Emphasis added.]
In A.-G. N.S. v. Davis, the relevant legislation read as follows:
Sections 1, 2, 3, 4, 5, 6, 7, 8, 11, 12, and 13 of this Act shall, with respect to the matters therein provided for, be deemed to be and to declare the law on and since the tenth day of May, A.D. 1917, and shall accordingly be construed and given effect retrospectively, except with respect to any estate which has been fully settled by a decree of a Probate Court.6 [Emphasis added.]
In Hutchinson v. Jauncey, the relevant legislation read that:
The three last foregoing sections shall apply whether the letting in question began before or after the commencement of this Act.7 [Emphasis added.]
The legislation in Western Minerals Ltd. v. Gaumont; Western Minerals Ltd. v. Brown and Beaver Sand & Gravel Ltd. deemed the owner of certain lands to have owned that property at all relevant times, declaring that:
The owner of the surface land is and shall be deemed at all times to have been the owner of and entitled to all sand and gravel on the surface of that land and all sand and gravel obtained by stripping off the overburden, excavating from the surface, or otherwise recovered by surface operations.8 [Emphasis added.]
In all of those cases, the language was given retrospective effect. While some of the language above is more complex, the language at issue in this case is simple, saying that the provision "is deemed to have come into force on" a specific date. Nonetheless, the test is the same: is the language sufficiently clear to rebut the presumption against retroactive application? In my view, it is.
The trustees have relied heavily on the Esso Resources case,9 which they contend stands for the proposition that legislation using these words cannot retroactively interfere with the vested rights of parties. That case, however, is different from the present matter, in that it dealt with the situation involving the repeal of legislation. In Esso Resources, Stone J.A. was dealing with vested rights which were specifically protected as a result of the operation of paragraph 43(c) of the Interpretation Act.10 He wrote [at page 124] that:
It seems to me that the learned trial judge was quite right in deciding that the respondent did possess a right "accrued" or "accruing" as of March 4, 1986, and hence that the right to a refund was preserved by the language of paragraph 43(c) of the Interpretation Act :
43. Where an enactment is repealed in whole or in part, the repeal does not . . .
(c) affect any right, privilege, obligation or liability acquired, accrued, accruing or incurred under the enactment so repealed [Emphasis added.]
His Lordship also relied on paragraph 43(e) of the Interpretation Act to the effect, inter alia [at page 125], that any "legal proceeding . . . may be . . . continued . . . as if the enactment had not been so repealed". In this case, since it does not deal with the repeal of an enactment, section 43 of the Interpretation Act does not operate to preserve the so-called vested rights of the trustees. In any event, as I shall explain below, even if the legislation does not operate retroactively, the trustees had no vested rights with which the statute interfered.
Therefore, for the reasons given by Rip J.T.C.C., and because common sense suggests that provisions which "are deemed to have come into force on" a certain date apply to all actions which commenced after that date, I would hold that the legislation in question applied to these actions as if that legislation had received Royal Assent on December 17, 1990.
2. If the legislation does not apply retroactively, are the management fees subject to GST?
If I am wrong, and the legislation does not apply retroactively, I would agree with the Tax Court Judge that the management fees were subject to GST under the old legislation. Again, I am in substantial agreement with the thorough reasoning of Rip J.T.C.C. below. On the issue of whether the services are being provided by one "person" to another "person," Rip J.T.C.C. reasoned that the managers are making taxable supplies to the mutual fund trusts as contemplated by the ETA:
It is the appellants' position that there is no clear charge to tax where the services provided cause the trusts to come into existence and continue to exist. Yet, the appellants do not properly address the question of whether the supplies are made in the course of a commercial activity. Both paragraphs (a) and (b) of the definition of "commercial activity" are relevant to this determination. Paragraph (a) states that a commercial activity means a business carried on by the person (i.e. CIMF and Trimark). Both CIMF and Trimark are engaged in the business of providing management and administrative services to mutual fund trusts. Indeed, the management contracts provide for the provision of what witnesses have referred to as management and administration functions. As I have already said, the fee under the management agreement is for both these services. Paragraph (b) of the definition of commercial activity is also determinative. It provides that an adventure or concern of the person in the nature of trade constitutes a commercial activity. In the instant case, if CIMF and Trimark are not engaged in the business of providing management and administration services, they are definitely engaged in an adventure or concern in the nature of trade in the form of providing management and administrative services to the mutual fund trusts and, incidentally, they do so with the reasonable expectation of gaining a profit. It would be quite difficult to say that both Trimark and CIMF are not engaged in commercial activities. The ETA explicitly provides that services which are rendered in any manner in the course of a commercial activity are taxable. To characterise the activities of Trimark and CIMF in any other way defies all logic and sense. This having been said, the fact that these services are necessary to bring the trusts into existence, and for them to continue to exist, seems to be beside the point and materially irrelevant.11
I can find no error in this reasoning.
Furthermore, before this Court, counsel for the trustees suggested that the contract between TIMI and Trimark under which the management fees are paid was not a true contract, as it was concluded between a trustee and himself. This Court, however, has recently upheld the legal form of an arrangement whereby a trustee purported to contract with himself to provide management services to a corporation, which in turn paid the trust for his services.12 If such arrangements will be upheld for tax reduction purposes, they must be similarly upheld where tax is payable as a result. The provision of management services from the trustee to the trust is a commercial activity which is subject to GST.
With regards to the issue of whether the trustees constitute officers of the trusts for purposes of the ETA, I agree with Rip J.T.C.C. that they do not. The provisions of the ETA in this matter are meant to exclude the employer"employee relationship from the application of the GST. It is for this reason that the provisions of the ETA define "officer" to include a series of individuals.13 I further agree with Rip J.T.C.C. when he reasoned that:
The services provided to the mutual funds, on which the GST was calculated, all relate to management activities (including administration) and not trustee activities. Therefore, even if I had concluded that the trustee was an officer of the trust, the trustee was not performing duties as a trustee, but as a manager. It is possible for a trustee to provide services to a trust in a capacity other than that of trustee, as pointed out by both the appellant and the respondent, and these services are subject to GST. A lawyer who acts as trustee to a trust may render certain legal services to the trust and these activities are subject to GST. The same can be said of any other professional who renders services to a trust in a capacity other than that of trustee.14
Finally, the services provided by the managers were not exempt financial services as contemplated by the ETA. The relevant section of the ETA reads:
"financial service" means
. . .
but does not include
. . .
(q) the provision of management or administrative services to a corporation, partnership or trust the principal activity of which is the investing of funds on behalf of shareholders, members or other persons.15 [Emphasis added.]
The trustees argue that the section does not apply because, as trustee, they are not investing "on behalf of" anyone. They are, rather, investing their own funds. Rip J.T.C.C. reasoned that the words "on behalf of" are equivalent to "for the benefit of." He wrote that:
On its face, this typical agreement shows that CIMF (and Trimark) provide management and administrative services to the individual mutual fund trusts. The respondent's argument on this point is, in my opinion, correct. Her counsel submitted that investors purchase mutual funds to invest in a portfolio of financial products in particular financial markets. Thus, put in ordinary commercial terms, the trust makes investments on behalf of its unitholders. The "on behalf of" aspect of the definition poses a certain difficulty, but as Trainor, C.J. pointed out in Re Millar, "by or on behalf of the dependants or any of them" in the context of the Dependants of a Deceased Person Relief Act, could only mean "for the benefit of". Therefore, one can interpret "on behalf of" as meaning "for the benefit of" if the context commands such an interpretation. In the appeals at bar, people invest their money in mutual funds so as to benefit from the expertise of the managers of the funds from which they hope to benefit. Hence, it is completely appropriate to interpret the phrase "on behalf of" as "for the benefit of". I also agree with the respondent that any other interpretation would effectively deprive the provision of any meaning and effect. Therefore, this construction should prevail over any other16 . [Citations omitted.]
I agree. I would also note that, before this Court, counsel for the respondent pointed to the Concise Oxford Dictionary, which defines "on behalf of" to mean "in the interests of a person".17
3. Were administrative fees or securities filing fees incurred by the managers as agents for the trusts?
The administrative fees in question are of two kinds: fees representing the cost of employees who are tasked with trust administration, and fees representing securities commission filing fees. In my view, those fees which represent the cost of employees tasked with trust administration are part and parcel of the services provided by the manager to the trusts. While these employees perform some functions which would otherwise have to be performed by the trustees, I am not convinced that the administrative tasks performed by these employees are strictly limited to trustees' services. These employees perform functions which are integral to the smooth operation of the trusts. They are employed by the managers to provide the necessary, day-to-day administrative services which management requires and which unitholders (i.e., clients) of the trust would expect. It makes no difference that the managers charge administrative fees at cost but charge management fees equal to a percentage of the holdings. The fees are charged for services provided, and for the reasons stated above are taxable.
With regard to securities filing fees, however, the evidence is somewhat different. The actions of the managers filing registration documents with the provincial securities commissions are the actions of an agent. Put shortly, these actions contain all the hallmarks of agency. In this situation, Fridman's classic definition of agency is helpful:
Agency is the relationship that exists between two persons when one, called the agent, is considered in law to represent the other, called the principal, in such a way as to affect the principal's legal position in respect of strangers to the relationship by the making of contracts or the disposition of property.18
Of course, agency is not limited to dealings with contract or property. An agent may be empowered to renew a licence, including a licence to sell securities as that term is defined within a jurisdiction.19
In response to questions from this Court, counsel for the respondent argued that the managers need to pay securities commission filing fees in order to market and expand the business of the trust and benefit from that expansion. He submitted that this expansion does not benefit the current unitholders in any way, and thus are paid by the managers to benefit themselves. I cannot agree. The actions of the managers in this sense are little different from the actions of a solicitor, accountant, or any other representative who might file with securities commissions as agent for a trust: all file registrations with securities filing commissions on behalf of the trust, all do so in the course of their professional activities, and, as pointed out in this Court, despite different legal consequences which might flow from a failure to file on behalf of the trust, all are legally and professionally obliged to do so. I would therefore hold that securities filing fees are paid by the managers as agent for the trusts.
I am bolstered in this conclusion by the position taken by Revenue Canada with regards to the GST, agency, and filing fees. Revenue Canada Policy P-209,20 which elaborates on Revenue Canada Policy P-182,21 specifically discusses agency as regards lawyers' fees and disbursements. In discussing "business law practice," the policy specifically states that all fees expended to create or maintain a business entity are normally incurred as agent. The policy states that the following fees are normally incurred by solicitors as agent:
Fees or expenses incurred in the process of incorporating, registering, and maintaining the status of particular legal relationships (such as a company, partnership, society, or association). For example, such fees include:
" basic fee to incorporate
" basic fee to register
" basic fee to amalgamate
" fee to dissolve a status
" fee to continue a status .22 [Emphasis added.]
As stated above, I am unable to conclude that the differences between the behaviour of the managers and the behaviour of solicitors in this regard are significant enough to warrant differential tax treatment. These fees should not have been subject to the GST.
DISPOSITION
For all the foregoing reasons, I would allow the appeals only to the extent of permitting a GST rebate as regards to securities commission filing fees. In all other regards, I would dismiss these appeals. The appellants should be paid one fifth of the costs throughout.
Létourneau J.A.: I agree.
Sexton J.A.: I agree.
1 Excise Tax Act, R.S.C., 1985, c. E-15.
2 Bill C-70 was enacted as S.C. 1997, c. 10.
3 Reasons of Rip J.T.C.C., at reasons, p. 19, Appeal Book, at p. 3462. The reasons of Rip J.T.C.C. are published at [1997] T.C.J. No. 1080 (QL) [indexed as: C.I. World Bond Fund Trust v. Canada]. All citations will be to the judgment as printed in the Appeal Book.
4 Appeal Book, at p. 3464.
5 [1916] 2 K.B. 249, at pp. 255-256.
6 [1937] 3 D.L.R. 673 (N.S.S.C.), at p. 676.
7 [1950] 1 K.B. 574 (C.A.) at p. 576.
8 (1951), 3 WWR (NS) 434, at p. 442 (Alta. S.C. App. Div.).
9 Esso Resources Canada Ltd. v. Canada, [1991] 1 C.T.C. 121 (F.C.A.).
10 R.S.C., 1985, c. I-21.
11 Appeal Book, at p. 3468 [at para. 63 (QL)].
12 See Ferrel v. Canada, [1999] F.C.J. No. 102 (C.A.) (QL); affg (1997), 97 DTC 1565 (T.C.C.). Note that, as a result of Mr. Ferrel's arrangement with himself, his infant children were able to receive the funds of the trust, effectively reducing the tax payable had the management fees been paid to Mr. Ferrel as income.
13 ETA, s. 123(1) "officer" [as enacted by S.C. 1990, c. 45, s. 12].
14 Appeal Book at pp. 3470-3471 [at para. 71 (QL)].
15 ETA, s. 123(1) "financial service."
16 Appeal Book, at p. 3472 [at para. 73 (QL)].
17 Concise Oxford Dictionary of Current English, 8th ed. (Oxford: Clarendon Press, 1990).
18 G. H. L. Fridman, The Law of Agency, 7th ed. (Toronto: Butterworths, 1996), at p. 11.
19 See, e.g., Cameron Harvey, Agency Law Primer (Scarborough: Carswell, 1993), at p. 2.
20 Dated March 11, 1997.
21 Dated June 23, 1995, discussing agency as that term applies to the GST.
22 Revenue Canada (GST) Policy 209, as reproduced in David M. Sherman, Canada GST Service (Scarborough, Carswell, 1998), at pp. 178-138 to 178-139.