The appellant sought rectification of transactional documents under article 1425 C.C.Q. after an implemented cross-border financing structure created unforeseen foreign accrual property income and significant federal tax liability.
The majority held that a general intention of tax neutrality, without sufficiently determinate or determinable obligations and prestations, cannot ground retroactive modification of written instruments.
The Court distinguished correction of transcription errors from retroactive alteration of agreed transactions that merely produced unintended consequences.
It concluded the parties made no expression error, but instead chose transactions that generated adverse tax results.
The appeal was dismissed with costs, with two judges dissenting in favour of broader rectification aligned with prior Quebec jurisprudence.
