Marie Deschamps

The Court addressed transfer pricing under s. 69(2) of the Income Tax Act in a dispute over the reasonableness of amounts paid by a Canadian taxpayer to a non-arm’s length supplier for ranitidine.

It held that determining a reasonable arm’s length amount requires consideration of economically relevant circumstances, including linked agreements conferring rights and benefits beyond mere supply where those agreements affect pricing.

The Tax Court erred in excluding the Licence Agreement from the comparability analysis.

The matter was properly remitted for redetermination of the reasonable amount with regard to the linked rights and benefits.

The appeal and cross-appeal were dismissed.

The court considered whether a single-purpose corporate purchaser seeking specific performance after a failed land transaction was exempt from the mitigation principle in contract damages.

The majority held that incorporation benefits carry corresponding burdens, including reasonable mitigation efforts where substitute opportunities are available.

It concluded the purchaser lacked a substantial and legitimate basis to avoid mitigation and that the evidentiary record supported available comparable development opportunities.

The dissent would have restored trial damages, finding no palpable and overriding error on mitigation opportunity and reasonableness.

The appeal and cross-appeal were both dismissed, leaving the appellate reduction to nominal damages in place.

On a criminal appeal from fraud convictions, the court considered whether trial counsel’s comment invited an impermissible adverse inference from a co-accused’s silence and whether the trial judge’s charge required an explicit remedial direction under s. 4(6) of the Canada Evidence Act.

The majority held that a trial judge may affirm the right to silence when there is a realistic risk of misuse, but found the charge as a whole adequately conveyed that silence is not evidence.

The court also found the erroneous admission of hearsay did not create a realistic possibility of a different verdict.

The conviction was upheld under the curative proviso in s. 686(1)(b)(iii) of the Criminal Code.

The appellant Crown appealed acquittals entered after a criminal prosecution for aggravated sexual assault based on non-disclosure of HIV-positive status.

The Court reaffirmed that fraud vitiating consent under ss. 265(3)(c) and 273 requires a dishonest act and deprivation, and held that deprivation turns on whether there was a realistic possibility of HIV transmission.

The Court held that, on the record, a realistic possibility is negated where the accused had a low viral load and condom protection was used.

Applying that test, the Court restored three convictions where no condom was used and maintained one acquittal where condom use accompanied a low viral load.

The appeal was allowed in part.

The Court dismissed the Crown appeal and upheld the setting aside of convictions for sexual assault and aggravated assault.

It held that on these facts condom use was required to negate a realistic possibility of HIV transmission, but the trial judge committed an error of law by relying on speculative inferences from a doctor's note as confirmatory evidence that no condom was used.

Without reliable confirmatory evidence, guilt was not proven beyond a reasonable doubt.

A 15-year-old sought an order requiring an internet provider to identify the creator of a fake sexualized profile and asked to proceed anonymously with a publication ban.

The Court held that objective harm to children from cyberbullying can justify anonymity without individualized evidence of specific harm.

It allowed anonymous proceedings to protect the child’s privacy and access to justice.

It declined to ban publication of non-identifying profile content because open court and press freedom outweighed further restriction once identity protection was in place.

The Court also set aside prior costs orders against the appellant and made no costs order in the Court.

This appeal addressed public interest standing in a broad constitutional challenge to prostitution-related Criminal Code provisions.

The Court reaffirmed that standing is determined by a flexible, purposive weighing of three factors: serious justiciable issue, genuine interest, and whether the proceeding is a reasonable and effective means to bring the claims forward.

It held that parallel or potential litigation does not automatically defeat standing and that practical barriers affecting directly impacted persons are relevant to the analysis.

In the circumstances, the respondents met the test and were granted public interest standing.

A prisoner appealed the setting aside of a stay entered after a trial judge found a section 7 breach arising from severe mistreatment by a state actor during transport custody.

The Court held that appellate review of section 24(1) remedies is highly deferential and intervention is justified only for legal error, reviewable factual error, or a clearly unjust result.

On the trial findings, the stay remained an available and proportionate remedy in exceptional circumstances where continuation would undermine confidence in the administration of justice.

The Court also held that, when setting aside a stay, an appellate court may in appropriate cases remit the matter for continuation of trial under Criminal Code sections 686(4) and 686(8).

The Court considered whether farming losses were fully deductible where a taxpayer's law practice and horse-racing farming business together formed a chief source of income under s. 31(1) of the Income Tax Act.

It held that prior precedent had improperly narrowed the statutory combination test, overruled that aspect of Moldowan, and confirmed a contextual approach examining capital, income, time, and the taxpayer's mode of living.

Applying that approach, the Court found no basis to disturb the trial findings that the taxpayer significantly emphasized both activities, so the farm-loss limitation did not apply.

The Crown's appeal was dismissed with costs.

The Court held that probation orders attached to a sentence of imprisonment not exceeding two years are not invalidated by prior or subsequent sentences imposed on other occasions.

It interpreted section 731(1)(b) as referring to the term imposed at the sentencing hearing in question, while confirming that probation cannot accompany sentences imposed at one sitting that produce continuous custody over two years.

The appeals were dismissed and the impugned probation orders remained valid.

In a murder appeal, the Court considered whether the trial judge improperly relied on the common sense inference on intent without first assessing all evidence bearing on the accused’s mental state.

The Court held that there was no legal error because the trial judge had reviewed the full evidentiary record relevant to intent, including alcohol consumption and surrounding circumstances, before applying the inference.

The Court also refused fresh psychiatric evidence, finding lack of due diligence and no reasonable possibility that the proposed evidence would have changed the verdict under the Palmer test.

The conviction for second degree murder therefore stood.

In a criminal appeal, the Court considered whether kidnapping under the Criminal Code is a continuing offence that includes the victim’s ongoing confinement after the initial taking.

The Court held that kidnapping continues in fact until the victim is freed and that a person who knowingly joins the confinement phase can be liable as a party under s. 21(1).

Applying those principles to the trial findings, the Court upheld the substituted kidnapping conviction.

The Court held that issue estoppel in a prior jury matter applies only when a finding in favour of the accused was logically necessary to the acquittal.

Because the acquittals on criminal organization counts could be explained by more than one route, including failure to prove association elements, the Crown was not barred from litigating whether the Hells Angels was a criminal organization in later proceedings.

In a copyright appeal, the Court considered whether pre-existing sound recordings embedded in film and television soundtracks remain subject to equitable remuneration under s. 19 of the Copyright Act when the soundtrack accompanies a cinematographic work.

Applying modern statutory interpretation, the Court held that the soundtrack exclusion in the definition of sound recording captures pre-existing recordings in that context.

The Court found this reading consistent with the legislative scheme, parliamentary intent, and international obligations under the Rome Convention.

As a result, the proposed tariffs could not be certified for performances or communications of recordings when accompanying cinematographic works.

In an appeal from judicial review of a copyright tariff ruling, the Court examined whether teacher-made classroom photocopies qualified as fair dealing for research or private study under s. 29 of the Copyright Act.

The majority held the tribunal unreasonably applied key fairness factors by separating teacher and student purposes, assessing amount on aggregate copying rather than excerpt-to-work proportion, treating additional textbook purchases as a practical alternative, and inferring market harm without an adequate evidentiary link.

Applying reasonableness review, the Court concluded the unfairness determination could not stand and remitted the matter for reconsideration.

A dissent would have deferred to the tribunal’s multifactor factual assessment and would have upheld the result despite one flawed effect-of-the-dealing finding.

The appeal concerned whether online music previews streamed before purchase are fair dealing for the purpose of research under the Copyright Act.

The Court held that research must be interpreted broadly and assessed from the user perspective, not only from the service provider perspective.

Applying the CCH framework, the Court found the previews fair in purpose, character, amount, alternatives, nature of the work, and market effect.

Because the previews were short, lower quality, temporary, and supported consumer selection without substituting for purchases, no additional royalties were payable for them.

In a copyright tariff appeal concerning online music services, the Court addressed whether on-demand transmissions over the Internet constitute communication to the public by telecommunication under the Copyright Act.

The Court held that individual user-initiated streaming transmissions are not private in character when viewed as repeated transmissions to members of the public, and therefore remain within the communication right.

In light of the companion ruling on downloads, the download issue was moot and the appeal succeeded only to that extent.

The Court further held that correctness applied to the legal question under the statutory scheme, while a concurrence preferred reasonableness deference to the specialized tribunal.

The appeal concerned whether downloading a video game containing musical works over the Internet engages the communication right under s. 3(1)(f) of the Copyright Act in addition to reproduction rights.

A majority held that applying a separate communication tariff to permanent downloads would offend technological neutrality because downloading a durable copy is functionally equivalent to purchasing a copy in physical form.

The majority interpreted the communication right as historically tied to performance-based activity and set aside the tariff certification as applied to downloads.

The dissent would have treated communication and reproduction as distinct independent rights both engaged by Internet downloads.

The Crown appealed acquittals entered on criminal organization counts and the quashing of a possession-for-trafficking conviction.

The Court held the possession verdict was unreasonable because the evidentiary nexus between the seized cocaine and the accused’s conspiracy was not proven.

It further held that the accused was not a member of the trafficking group for purposes of membership-based liability under the organized-crime provisions.

However, the Court found the trafficking offence was committed in association with the organization because the accused knowingly supplied and supported its operations.

The appeal was therefore allowed only to restore the conviction on the association-based count.

The Court allowed the appeal and ordered a new trial, holding that the trial judge erred by requiring scientific reconstruction evidence for but-for causation and by applying material contribution to risk in a single-defendant negligence case where the ordinary but-for framework governs.