McGillivray Restaurant Ltd. in FCA March 2016 (Meaning of Defacto Control)

Date: 20160330

Docket: A-571-14

Citation: 2016 FCA 99

CORAM: DAWSON J.A.

RYER J.A.

DE MONTIGNY J.A.

BETWEEN:

MCGILLIVRAY RESTAURANT LTD.

Appellant

and

HER MAJESTY THE QUEEN

Respondent

Heard at Winnipeg, Manitoba, on March 3, 2016.

Judgment delivered at Ottawa, Ontario, on March 30, 2016.

REASONS FOR JUDGMENT BY: RYER J.A.

CONCURRED IN BY: DAWSON J.A.

DE MONTIGNY J.A.

Date: 20160330

Docket: A-571-14

Citation: 2016 FCA 99

CORAM: DAWSON J.A.

RYER J.A.

DE MONTIGNY J.A.

BETWEEN:

MCGILLIVRAY RESTAURANT LTD.

Appellant

and

HER MAJESTY THE QUEEN

Respondent

REASONS FOR JUDGMENT

RYER J.A.

[1] This is an appeal from a decision of Justice Patrick Boyle of the Tax Court of Canada

(the “Judge”), dated November 28, 2014 and cited as 2014 TCC 357. The appeal arises out of

reassessments issued by the Minister of National Revenue (the “Minister”) pursuant to the

Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.) (the “Act”) to McGillivray Restaurant Ltd. (the

“Taxpayer”) in respect of its 2007, 2008 and 2009 taxation years (the “Reassessments”). Unless

otherwise indicated, all references in these reasons to statutory provisions shall be to the

corresponding provisions of the Act that applied in respect of the Reassessments.

[2] In each Reassessment, the Minister denied the Taxpayer’s claim for a deduction from its

tax otherwise payable under Part I of the Act for the applicable taxation year, pursuant to

paragraph 125(1)(a) (the “Small Business Deduction”), on the basis that the Taxpayer was

associated with one or more corporations in each such taxation year, within the meaning of

subsection 256(1), and had not filed an agreement with any such corporation as contemplated by

subsection 125(3).

[3] The issue in this appeal is whether, in the years covered by the Reassessments, the

Taxpayer was associated with G.R.R. Holdings Ltd. (“GRR”) and MorCourt Properties Ltd.

(“MorCourt”) on the basis that an individual, Mr. Gordon R. Howard, who had de jure and de

facto control over GRR and MorCourt, also had de facto control over the Taxpayer, within the

meaning of subsection 256(5.1).

[4] The Judge determined that MorCourt, GRR and the Taxpayer were associated

corporations, within the meaning of subsection 256(1) and upheld the Reassessments.

[5] For the reasons that follow, I would dismiss the appeal.

I. BACKGROUND

[6] The appeal before the Judge proceeded on the basis of a partially agreed statement of

facts. In addition, the Judge made a detailed summary of the evidence presented to him, which

consisted of read-ins by the Crown from the examination for discovery of Mr. Howard and an

Agreed Book of Documents. The essential facts for the purpose of dealing with the issues raised

in this appeal are summarized below.

[7] At all relevant times, Mr. Howard and Mrs. Ruth Howard were married. Mr. Howard

owned all of the issued shares of GRR and MorCourt. GRR was incorporated in the early 1980s

and MorCourt was incorporated around the same time as the Taxpayer. Like the Taxpayer, each

of GRR and MorCourt is a Canadian-controlled private corporation, within the meaning of

subsection 125(7).

[8] In 1997, GRR entered into franchise agreements with Keg Restaurants Ltd. (the

“Franchisor”) and acquired certain territorial exclusivity rights with respect to the operation of

Keg Restaurant franchises in Winnipeg. Pursuant to these arrangements, GRR successfully

operated three Keg Restaurants in Winnipeg until late 2005. The exclusivity rights were

conditional on GRR continuing to operate a minimum of three Keg restaurants in Winnipeg.

[9] At some time before the incorporation of the Taxpayer, Mr. Howard decided that the

Pembina Highway Restaurant should be relocated. To that end, arrangements were made to

acquire some land on McGillivray Avenue and to obtain the Franchisor’s consent to the

relocation.

[10] In conjunction with the relocation transaction, Mr. Howard sought professional advice

and, as a consequence, he determined that it would be prudent to “start separating some things”,

given the success that had been enjoyed since the acquisition of the three Keg-franchised

restaurants.

[11] To that end, MorCourt was incorporated for the purpose of acquiring the restaurant

buildings and the land upon which they were situated. More germane to this appeal, the

Taxpayer was incorporated for the purpose of acquiring and operating the new McGillivray

Avenue restaurant, including the franchise that would permit the operation of that restaurant.

[12] Consistent with the professional advice that Mr. Howard received, the Taxpayer was

incorporated in August of 2005. Upon its organization, Mrs. Howard was issued 760 voting

common shares for $76.00 and Mr. Howard was issued 240 voting common shares for $24.00. In

addition, Mr. Howard was elected as the sole director of the Taxpayer and appointed as its only

officer. No written shareholders’ agreements were put into place. The capitalization of the

Taxpayer was nominal.

[13] The record contains little to explain the basis upon which the Taxpayer legally acquired

or financed the property that it used when it commenced operations at the McGillivray Avenue

location in December of 2005, shortly after the closing of the Pembina Highway location.

However, the record does disclose documentation that provided for the assignment of the

franchise covering the Pembina Highway location from GRR to the Taxpayer and the

Franchisor’s consent to that assignment.

[14] Mr. Howard was well aware of the importance of complying with the terms of the

franchise agreements that related to the three restaurants, and the requirements for the consent of

the Franchisor to the relocation of the Pembina Highway location and the assignment of the

related franchise to the Taxpayer. At his examination for discovery, he testified that he assured

the Franchisor that notwithstanding these changes, things would be run on the same basis as they

had in the past. He also testified, at his discovery, that he gave similar assurances to the former

Pembina Highway employees whose employment was transferred to the Taxpayer. Mrs. Howard

had limited involvement in the operations of the Taxpayer. She and her husband personally

guaranteed the obligations of the Taxpayer and GRR to the Franchisor.

[15] The determination of Mrs. Howard’s 76% ownership interest in the Taxpayer was based

upon the professional advice that had been provided to Mr. Howard. Nonetheless, the Taxpayer

was organized on the basis that Mr. Howard would not need his wife’s approval to make

decisions on behalf of the Taxpayer. In that regard, Mr. Howard assured his wife that

notwithstanding her 76% ownership position in the Taxpayer, the restaurants would continue to

operate as they always had, and the evidence indicates that this is how things proceeded.

II. THE DECISION OF THE JUDGE

[16] The Judge determined that there were two competing interpretations of subsection

256(5.1). He found that this Court’s decision in Silicon Graphics Limited v. Canada, 2002 FCA

260, [2003] 1 F.C.R. 447 [Silicon Graphics], provided a narrow interpretation under which a

person would only be considered to have control in fact if that person had the clear right and

ability either to effect significant change in the board of directors or the powers of the board of

directors or to influence in a very direct way the shareholders who would otherwise have the

ability to elect the board of directors.

[17] In contrast, he concluded that this Court’s decisions in Mimetix Pharmaceuticals Inc. v.

Her Majesty the Queen, 2003 FCA 106, [2003] 3 C.T.C. 72 [Mimetix Pharmaceuticals] and

Plomberie J.C. Langlois Inc. v. Canada, 2006 FCA 113, [2007] 3 C.T.C. 148 [Plomberie J.C.

Langlois] had broadened the test set forth in Silicon Graphics. Thus, he concluded that the test

required him to look beyond the right and ability to affect the composition or powers of the

board, and to consider broader manners of influence in making the determination of who in fact

has effective control of the affairs and fortunes of the corporation in question.

[18] In applying this broader test, the Judge found that Mr. Howard could not have had any

more effective factual control over the management and operation of the Taxpayer and its

business.

[19] In addition, at paragraph 59 of his reasons, the Judge concluded that Mr. and Mrs.

Howard had reached an agreement to the effect that the franchise covering the McGillivray

Avenue location would be transferred to the Taxpayer and Mrs. Howard would acquire a 76%

interest in the Taxpayer for a nominal amount, only if she agreed to ensure that Mr. Howard was

the sole director and officer of the Taxpayer and that, as he had assured the Franchisor, things

would be run as they always had been.

[20] Finally, the Judge concluded that while Mrs. Howard could have replaced her husband as

the sole director of the Taxpayer (thereby repudiating their unwritten agreement), she did not do

so, observing that if she had decided to do so, she would have had to be concerned about the

potential consequences that could have resulted from such a decision.

III. RELEVANT STATUTORY PROVISIONS

[21] The provisions of the Act that are relevant to this appeal are paragraph 256(1)(b) and

subsection 256(5.1), which read as follows:

IV. ISSUES

[22] There are two issues in this appeal:

a) Did the Judge err in his interpretation of the requirements of de facto control in subsection 256(5.1)?

b) Did the Judge err in concluding that the Taxpayer was associated with GRR and MorCourt for the purposes of paragraph 256(1)(b)?

V. STANDARD OF REVIEW

[23] In appellate review of a decision of the Tax Court of Canada, this Court applies the

standard of correctness with respect to questions of law and the standard of palpable and

overriding error with respect to questions of fact and mixed fact and law in respect of which

there are no readily extricable questions of law (see Housen v. Nikolaisen, 2002 SCC 33, [2002]

2 S.C.R. 235 at paragraphs 8, 10 and 37).

VI. ANALYSIS

A. Introduction

[24] The circumstances in which the Taxpayer was incorporated, organized, capitalized and

then managed make it clear that Mrs. Howard had no meaningful interest in the Taxpayer or its

affairs beyond her $76.00 investment in its common shares. Moreover, the totality of these

circumstances indicate that the primary purpose of the incorporation of the Taxpayer and its

acquisition of the Pembina Highway restaurant and the related franchise may have been an

attempt to avoid the associated corporation rules in order to obtain an additional Small Business

Deduction.

[25] The associated corporation rules in section 256 are aimed, inter alia, at ensuring that

access to the Small Business Deduction is limited. A discussion of the scheme of the Act in

respect of that tax incentive is not necessary for the purpose of these reasons.

[26] Prior to the incorporation of the Taxpayer, GRR operated three Keg restaurants and was

limited to a single Small Business Deduction. The Taxpayer’s incorporation and its acquisition

of the McGillivray Avenue restaurant facilitated access to a second Small Business Deduction in

respect of one of the three restaurant businesses that were previously carried on by GRR.

[27] The Minister took exception to the claim for a second Small Business Deduction and

issued the Reassessments on the basis that GRR and MorCourt were associated with the

Taxpayer, within the meaning of paragraph 256(1)(b), because those corporations and the

Taxpayer were all controlled by Mr. Howard. That Mr. Howard had both de jure and de facto

control of GRR and MorCourt is not at issue. The Minister alleged that Mr. Howard also had de

facto control of the Taxpayer, within the meaning of subsection 256(5.1).

[28] The Minister has not alleged that the parties to the transactions pursuant to which the

Taxpayer acquired the McGillivray Avenue restaurant and the related franchise were engaged in

abusive tax planning. In other words, this is not a case in which the general anti-avoidance rule

in subsection 245(2) is engaged and the purpose behind the creation and deployment of the

Taxpayer is irrelevant.

[29] The overarching question is whether it can be said that Mr. Howard or GRR had any

direct or indirect influence that, if exercised, would result in either of them having control in fact

of the Taxpayer.

B. Did the Judge err in his interpretation of the requirements of de facto control in

subsection 256(5.1)?

[30] The determination of who controls a corporation or when an acquisition of control of a

corporation occurs has considerable significance under the Act. Prior to the introduction of

subsection 256(5.1), the Act included both “control” and “controlled directly or indirectly in any

manner whatever” but, in both of those formulations, control was thought of as de jure control.

[31] In Duha Printers (Western) Ltd. v. Canada, [1998] 1 S.C.R. 795, 159 D.L.R. (4th) 457

[Dula Printers], the seminal decision of the Supreme Court of Canada on corporate control, de

jure control was referred to as the ability of the owners of the majority of the voting power in the

corporation that would enable those owners to elect directors of the corporation and accordingly

to enjoy effective control of the corporation. In colloquial terms, the majority shareholder has the

power to get the directors to do what he or she wants in terms of the operation of the corporation,

failing which that shareholder will use his or her majority voting power to replace those directors

with others who will do his or her bidding.

[32] It is useful to recall that in paragraph 71 of Duha Printers, the Supreme Court affirmed

that an ordinary shareholders agreement, in contradistinction to a unanimous shareholders

agreement, is not relevant to the determination of de jure control. Thus, the voting power

attributable to shareholdings, determined in light of the constating documents and the share

register of a corporation, is generally the determinative factor in the de jure control analysis,

except in limited circumstances not relevant to this appeal, in which de jure control may not lie

with the person who holds the majority of the voting power in a corporation.

[33] In the de facto control analysis, as one would expect, there are a broader range of

attributes -beyond voting power determined in the context of constating documents and share

registers -that must be considered to determine whether the requirements of subsection 256(5.1)

have been met in any given case. For example, the rights of a person under the provisions of a

shareholders agreement, other than a unanimous shareholders agreement, under which

shareholders agree that the person will be able to select the directors, would fall within the

definition of “influence”, within the meaning of subsection 256(5.1). So, must the requisite

influence arise out of legally binding or enforceable arrangements, or can other kinds of

influence lead to a finding of de facto control? For example, does a person who by threats or

other vile means, at one end of the spectrum, or by matrimonial or familial love and affection, at

the other end of the spectrum, have the requisite influence over a shareholder, who would

otherwise have de jure control of a corporation, that would be sufficient to establish that such

person has de facto control over that corporation?

[34] Fortunately, in this appeal we are not obliged to resort to an analysis from first principles

because the meaning of de facto control, for the purposes of subsection 256(5.1), has been

previously considered by this Court.

[35] In Silicon Graphics, Justice Sexton formulated the test as follows:

[67] It is therefore my view that in order for there to be a finding of de facto

control, a person or group of persons must have the clear right and ability to effect a significant change in the board of directors or the powers of the board of directors or to influence in a very direct way the shareholders who would otherwise have the ability to elect the board of directors.

[36] This test was affirmed in 9044 2807 Québec Inc. v. Canada, 2004 FCA 23, 325 N.R. 226

[Transport Couture], wherein Justice Noël (as he then was), stated:

[24] It is not possible to list all the factors which may be useful in determining

whether a corporation is subject to de facto control (Duha Printers, [1998] 1

S.C.R. 795, para. [38]). However, whatever factors are considered, they must

show that a person or group of persons has the clear right and ability to change the

board of directors of the corporation in question or to influence in a very direct

way the shareholders who would otherwise have the ability to elect the board of

directors (Silicon Graphics, [2002] FCA 260, para. [67]). In other words, the

evidence must show that the decision-making power of the corporation in

question in fact lies elsewhere than with those who have de jure control. [Emphasis added]

[37] At the heart of Justice Noël’s description of the legal test for de facto control is

essentially a restatement of the test enunciated by Justice Sexton in Silicon Graphics. Nothing in

this excerpt from Justice Noël’s reasons suggests an intention on his part to depart from the

Silicon Graphics formulation of the test for de facto control.

[38] I do not interpret Justice Noël’s last sentence in the above-quoted paragraph as

broadening or otherwise altering the Silicon Graphics test. It immediately follows a clear and

direct endorsement of the Silicon Graphics test. Moreover, in my view, its introductory phrase

” In other words” indicates that this sentence is intended to constitute only a paraphrase of that

test. Although interpreted in isolation this sentence might suggest a broader approach, its

immediate context requires an interpretation bounded by the clear endorsement of the Silicon

Graphics test.

[39] As previously mentioned, the Judge concluded that Mimetix Pharmaceuticals and

Plomberie J.C. Langlois required him to consider broad manners of influence, including exercise

of control over day-to-day operations in the de facto control analysis. While it is true that in these

two decisions a broader test appears to have been considered, the narrow test set out in paragraph

67 of Silicon Graphics, which in my view was its ratio decidendi, was never directly challenged

before this Court in either of these decisions.

[40] It is well established that this Court will follow its previous decisions unless “the

previous decision is manifestly wrong, in the sense that the Court overlooked a relevant statutory

provision, or a case that ought to have been followed” (see Miller v. Canada (Attorney General),

2002 FCA 370, 220 D.L.R. (4th) 149 at paragraph 10). This Court did not address any argument

that Silicon Graphics was manifestly wrong and should not be followed in either Mimetix

Pharmaceuticals or Plomberie J.C. Langlois. Moreover, in both Mimetix Pharmaceuticals and

Plomberie J.C. Langlois, this Court was primarily concerned with the Tax Court’s appreciation

of the evidence before it.

[41] To be clear, in my view, to the extent that those decisions may be taken as having

prescribed a test for de facto control that is inconsistent with the Silicon Graphics test, those

decisions ought not to be followed.

[42] At the hearing, Crown counsel asserted that this Court “clarified” the Silicon Graphics

test in Lyrtech RD Inc. v. Canada, 2014 FCA 267, 470 N.R. 364 [Lyrtech], a decision that was

apparently not before the Judge.

[43] In Lyrtech, this Court affirmed that the test for de facto control is that in Silicon

Graphics, adding that paragraph 24 of the decision in Transport Couture clarified the Silicon

Graphics test. As noted above, it is my view that the stipulated paragraph from Transport

Couture must be taken as an affirmation of the Silicon Graphics test. Moreover, Lyrtech is

another example of the Court responding to asserted errors in factual findings made in the

decision under review. Lyrtech cannot, in my view, be read as having determined that the narrow

test in Silicon Graphics was manifestly wrong and ought not to be followed. To the extent that

Lyrtech may be taken as having repudiated the Silicon Graphics test, it ought not to be followed.

[44] Crown counsel argued that support for the broader approach to de facto control can be

found within Silicon Graphics itself. In paragraphs 63 to 65 of that decision, the Court dealt with

a number of arguments that were made to it as to the applicability of broader factors. In

dismissing these arguments on the basis that they were unsupported on the record, it is my view

that Justice Sexton cannot be taken as having undermined the test that he clearly enunciated in

paragraph 67 of his reasons.

[45] Accordingly, I affirm that the narrow test set out in paragraph 67 of Silicon Graphics is

correct and has not been overturned by this Court.

[46] I reject any assertion that the test for control in fact is based on “operational control”. De

facto control, like de jure control, is concerned with control over the board of directors and not

with control of the day-to-day operations of the corporation or its business. Paragraph 256(1)(b)

and subsection 256(5.1) specifically refer to control of a corporation and not to control of the

corporation’s business or operations. Indeed, this view is consistent with the conclusion of

President Jackett set out in Buckerfield’s Ltd. v. Minister of National Revenue, [1965] 1 Ex. C.R.

299 at pages 302-303, [1964] C.T.C. 504:

Many approaches might conceivably be adopted in applying the word “control” in

a statute such as the Income Tax Act to a corporation. It might, for example, refer

to control by “management”, where management and the Board of Directors are

separate, or it might refer to control by the Board of Directors. The kind of control

exercised by management officials or the Board of Directors is, however, clearly

not intended by section 39 when it contemplates control of one corporation by

another as well as control of a corporation by individuals. (see subsection (6) of

section 39). The word “control” might conceivably refer to de facto control by

one or more shareholders whether or not they hold a majority of shares. I am of

the view, however, that in section 39 of the Income Tax Act, the word

“controlled” contemplates the right of control that rests in ownership of such a

number of shares as carries with it the right to a majority of the votes in the election of the Board of Directors …

[47] While de jure control generally looks only to share ownership in the limited context set

forth in in Duha Printers, in determining who has control over the election of the board of

directors -and thus the corporation -there is nothing to suggest that de facto control is

anything other than control by some means short of that necessary to meet the test for de jure

control. In my view, control of a corporation for the purposes of the associated corporation

provisions of the Act has never been properly understood to mean what President Jackett referred

to as control by management or what might otherwise be called “operational” control.

[48] The difference between de facto and de jure control, then, is limited to the breadth of

factors that can be considered in determining whether a person or group of persons has effective

control, by means of an ability to elect the board of directors, of a corporation. That said, it

remains the case that the list of factors that may be considered when applying the Silicon

Graphics test is open-ended. However, in my view, a factor that does not include a legally

enforceable right and ability to effect a change to the board of directors or its powers, or to

exercise influence over the shareholder or shareholders who have that right and ability, ought not

to be considered as having the potential to establish de facto control.

[49] In my view, an interpretation of de facto control as contemplated by subsection 256(5.1)

that fails to include a requirement that the influence in question must be grounded in a legally

enforceable right or ability runs counter to the clear admonition of the Supreme Court of Canada

in Canada Trustco Mortgage Co. v. Canada, 2005 SCC 54, [2005] 2 S.C.R. 601 wherein, at

paragraph 12, the Chief Justice and Justice Major unequivocally stated:

The provisions of the Income Tax Act must be interpreted in order to achieve

consistency, predictability and fairness so that taxpayers may manage their affairs

intelligently …

[50] An interpretation of subsection 256(5.1) that encompasses “operational” control would

import a degree of subjectivity into the de facto analysis that, in my view, would lead to

unpredictability, rather than predictability, as mandated by the Canada Trustco interpretative

approach.

[51] Having clarified that the Silicon Graphics test remains the test for de facto control, and it

appearing that the Judge applied a different test, I now turn to the facts in this appeal.

C. Did the Judge err in concluding that the Taxpayer was associated with GRR and

MorCourt for the purposes of paragraph 256(1)(b)?

[52] Having determined that the Judge applied an incorrect test for de facto control, it is

necessary for me to apply the correct test to the facts of this case.

[53] The Judge determined that Mr. and Mrs. Howard reached an agreement to the effect that

the franchise with respect to the Pembina Highway location would only be transferred from GRR

to the Taxpayer if Mrs. Howard agreed to use the voting power associated with her 760 common

shares of the Taxpayer to ensure that Mr. Howard was elected as the sole director of the

Taxpayer and that his directorship endured. In essence, the Judge found that the Howards had

made an agreement under which the identity and composition of the board of directors of the

Taxpayer would be under the control of Mr. Howard.

[54] At the hearing, counsel for the Taxpayer asserted that the Judge made a palpable and

overriding error in finding that Mr. and Mrs. Howard had made such an unwritten agreement.

Counsel correctly noted that the record contains no direct evidence of such an agreement.

However, he agreed that if there had been a written agreement to the same effect, the Minister’s

position that the corporations were associated would be unassailable. Counsel asserted correctly

that the Franchise Agreement, to which the Taxpayer was a party, did not require Mr. Howard to

be the Taxpayer’s sole director. From this, the Taxpayer asks this Court to infer that there was no

such oral agreement and that the Judge erred in his inference that there was one.

[55] A review on a standard of palpable and overriding error requires an appellate court to

show meaningful deference to the factual findings of a trial judge. In the circumstances, it is my

view that the Judge’ s finding that there was an unwritten agreement between Mr. and Mrs.

Howard was open to him on the evidence that was before him and in making it, he committed no

palpable and overriding error.

[56] The absence of a written agreement is not proof that there was no unwritten agreement.

The Judge was aware of the longstanding and successful relationship between Mr. Howard and

the Franchisor, underscoring the trust that had been established between them over the years.

This relationship indicates that the Franchisor may well have been satisfied by Mr. Howard’s

verbal assurances that things would be run in the same way they always had in the three

restaurants.

[57] Although the parties stipulated in the partial agreed statement of facts that Mrs. Howard

could terminate Mr. Howard’s directorship at any time, she did not do so. As long as the

unwritten agreement was in effect, Mr. Howard retained the right to determine the entirety of the

Taxpayer’s board of directors, i.e. that he would constitute the entire board. It is clear that the

rights possessed by Mr. Howard under the unwritten agreement with his wife fell short of giving

him de jure control of the Taxpayer, as he did not own a majority of its voting shares and that

agreement was not a unanimous shareholders agreement within the meaning of the governing

corporate legislation. Nonetheless, as long as that agreement was not repudiated by Mrs.

Howard, Mr. Howard’s right to determine the Taxpayer’s Board of Directors was influence of

the type contemplated by subsection 256(5.1), within the interpretation of this Court set out in

Silicon Graphics.

VII. CONCLUSION

[58] For the foregoing reasons, I would dismiss the appeal with costs.

“C. Michael Ryer”

J.A.

“I agree

Eleanor R. Dawson J.A.”

“I agree

Yves de Montigny J.A.”

FEDERAL COURT OF APPEAL

NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET: A-571-14

(APPEAL FROM A DECISION OF THE HONOURABLE JUSTICE PATRICK BOYLE

OF THE TAX COURT OF CANADA DATED NOVEMBER 28, 2014, (DOCKET NO:

2012-2500(IT)G)).

STYLE OF CAUSE: MCGILLIVRAY RESTAURANT

LTD. v. HER MAJESTY THE

QUEEN

PLACE OF HEARING: WINNIPEG, MANITOBA

DATE OF HEARING: MARCH 3, 2016

REASONS FOR JUDGMENT BY: RYER J.A.

CONCURRED IN BY: DAWSON J.A.

DEMONTIGNY J.A.

DATED: MARCH 30 2016

APPEARANCES:

Thor J. Hansell For The Appellant

Julien Bédard For The Respondent

Neil Goodridge

SOLICITORS OF RECORD:

Aikins MacAulay &Thorvaldson LLP FOR THE APPELLANT

Barristers and Solicitors

Winnipeg, Manitoba

William F. Pentney FOR THE RESPONDENT

Deputy Attorney General of Canada

Ottawa, Ontario