Canada v. Fries, [1990] 2 S.C.R. 1322

Wally Fries Appellant

v.

Her Majesty The Queen Respondent

Indexed as: Canada v. Fries

File No.: 21570.

1990: November 1.

Present: Lamer C.J.* and Wilson, La Forest, L'Heureux‑Dubé, Sopinka, Gonthier, Cory and McLachlin JJ.

on appeal from the federal court of appeal

Income tax ‑‑ Computation of income ‑‑ Appellant receiving from his union strike pay equivalent to his normal net take‑home pay during period he was on strike ‑‑ Whether strike pay to be included in appellant's income ‑‑ Income Tax Act, S.C. 1970‑71‑72, c. 63, s. 3(a).

Statutes and Regulations Cited

Income Tax Act, S.C. 1970‑71‑72, c. 63, s. 3(a).

APPEAL from a judgment of the Federal Court of Appeal, 1989 CanLII 9437 (FCA), [1989] 3 F.C. 362, 99 N.R. 208, 89 D.T.C. 5240, [1989] 1 C.T.C. 471, affirming a judgment of the Federal Court, Trial Division, 1985 CanLII 5606 (FC), [1985] 2 F.C. 378, 85 D.T.C. 5579, [1986] 1 C.T.C. 4, reversing the Tax Review Board's decision (1983), 1983 CanLII 5332 (TCC), 83 D.T.C. 117, [1983] C.T.C. 2124, that strike pay was not to be included in appellant's income. Appeal allowed.

Brian Scherman and James Nugent, for the appellant.

Ian MacGregor and Max Weder, for the respondent.

The judgment of the Court was delivered orally by

Lamer C.J. ‑‑ The judgment of the Court will be delivered by Justice Sopinka.

Sopinka J. ‑‑ We are not satisfied that the payments by way of strike pay in this case come within the definition of "income . . . from a source" within the meaning of s. 3 of the Income Tax Act, S.C. 1970‑71‑72, c. 63. In these circumstances the benefit of the doubt must go to the taxpayers. The appeal is therefore allowed and the decision of the Tax Review Board is restored. The appellant is to have his costs throughout.

Judgment accordingly.

Solicitors for the appellant: Balfour, Moss, Milliken, Laschuk, Regina.

Solicitor for the respondent: John C. Tait, Ottawa.

• Chief Justice at the time of judgment.