The appellant brought a motion under Rule 58 of the Tax Court of Canada Rules (General Procedure) for the determination of questions of law prior to the hearing of its appeal.
The appellant sought to determine whether a "misrepresentation" under subparagraph 152(4)(a)(i) of the Income Tax Act is strictly a misrepresentation of fact, and whether the characterization of gains as income or capital is a question of mixed law and fact falling outside that provision.
The court dismissed the motion, finding that the issue of whether a misrepresentation is attributable to neglect, carelessness, or wilful default cannot be resolved without an appreciation of the factual circumstances surrounding the filing positions.
As discoveries had not yet occurred, the factual context was necessary to properly determine the questions.
