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


Wally Fries                                                                                         Appellant




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] 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] 2 F.C. 378, 85 D.T.C. 5579, [1986] 1 C.T.C. 4, reversing the Tax Review Board's decision (1983), 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.



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