INCOME TAX
Appeal from Tax Court of Canada judgment (2007 TCC 303) holding Income Tax Act, R.S.C.,1985 (5th Supp.), c. 1, s. 160 not engaged since consideration flowing from respondent to friend—Respondent’s friend personally owing $80,000 in taxes, potentially liable for over $700,000—Respondent opening bank account in her name but account only used by friend—Respondent assessed for total amount of money deposited into account—Under s. 160(1), transferee of property liable to extent fair market value of consideration given for property falling short of fair market value thereof—S. 160 not applicable where fair market value given to transferor at time of transfer—No consideration herein as transaction between respondent, friend leaving respondent without anything equivalent to property transferred that could be collected—No legal forbearance (refraining from enforcing right) as no contract, merely moral obligation—Appeal allowed.
Livingston v. Canada (A-213-07, 2008 FCA 89, Sexton J.A., judgment dated 7/3/08, 14 pp.)