Canada v. Jennings
A-113-93
Robertson J.A.
15/6/94
4 pp.
Application for judicial review of Tax Court decision Minister erred in disallowing deduction for farm losses incurred by respondent's company from respondent's 1989 income-Respondent, "Class 1" farmer, transferring all farming assets to company incorporated in 1987 to facilitate "roll-over" to son on former's death-Application allowed-"Separate entities" principle not enforced when would yield result "too flagrantly opposed to justice, convenience or interests of Revenue"; "having chosen to receive the benefits of incorporation, he should not be allowed to escape its burden": Kosmopoulos v. Constitution Insurance Co., [1987] 1 S.C.R. 2-Tax Court erred in law in permitting losses of one legal entity to be used to offset income of another-Only in clearest of cases, and in compelling circumstances and after thorough legal analysis could "normal rule" be displaced-K.J. Beamish Construction Co. Ltd. v. M.N.R. (1990), 90 DTC 1584 (T.C.C.) and Denison Mines Ltd. v. Minister of National Revenu, [1971] F.C. 295 (T.D.) undermining respondent's position.