Statutory Interpretation

AuthorVern Krishna
ProfessionProfessor of Common Law, University of Ottawa Barrister at Law
“The diff‌iculties of so- called interpretation ar ise when the Legislature
has had no mean ing at all; when the question which i s raised on the
statute never occurre d to it; when what the judges have to do is, not
to determine what t he legislature did mean on a p oint which was
present to its mind, b ut to guess what it would have intended on a
point not present to its mind , if the point had been pres ent.”1
In this chapter, we set out the rules of the road in inter preting tax law.
Tax interpretation is not static; it evolves, particularly in the context of
provisions designed to control ta x avoidance, as we shift from literal to
purposive construction.
The primary pur pose of statutory interpretation is to un lock legis-
lative intent. In addition to the ordinar y rules, constitutional traditions
also play an important role in the interpretation of tax law. Tax legis-
lation is the product of elected legislatures. The lang uage of the Act
ref‌lects the constitutional w ill of the people through its elected repre-
sentatives. Thus, interpretation of tax law requires careful attent ion to
1 John Chipman Gray, Nature and Sources of th e Law: Statutes, 2d ed (New York:
Macmillan, 1921).
Statutory Inte rpretation 33
the words of the statute. There is a lesser role for judicial rulem aking in
tax law, than there is, for example, in const itutional law.2
The construction of the Act is a question of law. Section 12 of the Inter-
pretation Act state s:3
Every enactment i s deemed remedial, and sha ll be given such fair,
large and libera l construction and inter pretation as best en sures the
attainment of its object s.
Thus, we must interpret tax law in such a fai r and liberal manner
as best ensures the attainment of its purpose as articulated in the st at-
ute. The tension is in interpreting statutory language as express ed by
Parliament according to the context and purpose (often unarticulated)
of provisions.
The general principle of modern statutory construction is to interpret
statutes in context, in harmony and within the scheme of the legi sla-
tion. Dr Driedger, in the second edition of his work, Construction of
Statutes, stated the pr inciple as follows:4
Today there is only one principle or approach, na mely, the words of an
Act are to be read in the ir entire context and in t heir grammatic al and
ordinary s ense harmoniously w ith the scheme of the Act, the object of
2 See Stewart v Canada, 2002 SCC 46 [Stewart]; Lu dco Enterprises Ltd v Cana da,
2001 SCC 62 [Ludco].
3 Interpretation Act, RSC 1985, c. I-21, as amended. Section 3 re ads:
(1) Every provision of this Act appl ies, unless a contrar y intention appears,
to every enact ment, whether enacted before or afte r the commencement
of this Act.
(2) The provisions of this Act apply to t he interpretation of this Act .
(3) Nothing in this Act exclude s the application to an enactment of a r ule of
construct ion applicable to that enactment and n ot inconsistent with thi s
4 Elmer A Driedger, Construction of Statutes, 2d ed (Toronto: Butterworths, 1983)
at 87. See also Canada v Antosko, [1994] 2 SCR 312 at paras 24–25, 29 & 30 [An-

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