Edward R. Sojonky

The Minister of National Revenue appealed a decision holding that accounts receivable factored to a third party were not subject to a deemed trust for unremitted payroll deductions.

The Supreme Court of Canada held that while the deemed trust under s. 227(4.1) of the Income Tax Act attaches to property acquired by a tax debtor after a default, it does not continue to attach to property once it has been sold to a third-party purchaser for value in the ordinary course of business.

The appeal was dismissed.

The Supreme Court of Canada considered the valuation of imported goods under the Customs Act.

Mattel Canada imported goods manufactured in Hong Kong through a three-tiered distribution system.

The Court held that the relevant 'sale for export to Canada' under s. 48(4) was the sale between Mattel U.S. and Mattel Canada, as Mattel Canada was the importer who held title when the goods entered Canada.

The Court also held that royalties paid by Mattel Canada to a third-party licensor, and periodic licence fees passed through Mattel U.S. to master licensors, were not dutiable under s. 48(5)(a)(iv) because they were not paid as a 'condition of the sale' of the goods for export.

The appeal by Mattel Canada was allowed in part, and the cross-appeal by the Deputy Minister was dismissed.

The appellant suffered a back injury and was temporarily disabled, preventing him from making regular Canada Pension Plan (CPP) contributions.

When his disability became permanent, he applied for a CPP disability pension but was denied for failing to meet the recency of contributions test.

He argued that the CPP's 'drop-out' provision, which exempts periods of severe and permanent disability from the contribution calculation, violated his s. 15(1) Charter equality rights by not extending the same exemption to persons with temporary disabilities.

The Supreme Court of Canada dismissed the appeal, holding that the distinction did not demean the dignity of persons with temporary disabilities and therefore did not constitute discrimination under s. 15(1).