Thibaudeau v. Minister of National Revenue, (1995) 182 N.R. 1 (SCC)

• Judge: McLachlin and Iacobucci, JJ.
• Court: Supreme Court (Canada)
• Case Date: October 04, 1994
• Jurisdiction: Canada (Federal)
• Citations: (1995), 182 N.R. 1 (SCC);[1995] 1 CTC 382;29 CRR (2d) 1;12 RFL (4th) 1;1995 CanLII 99 (SCC);[1995] 2 SCR 627;55 ACWS (3d) 516;124 DLR (4th) 449;49 DTC 5273;[1995] SCJ No 42 (QL);182 NR 1

Thibaudeau v. MNR (1995), 182 N.R. 1 (SCC)

MLB headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Her Majesty The Queen (appellant) v. Suzanne Thibaudeau (respondent) and Attorney General of Quebec, Support and Custody Orders for Priority Enforcement (SCOPE), Charter Committee on Poverty Issues, Federated Anti-Poverty Groups of British Columbia, National Action Committee on the Status of Women, and Women's Legal Education and Action Fund (The Coalition) (interveners)

(No. 24154)

Indexed As: Thibaudeau v. Minister of National Revenue

Supreme Court of Canada

La Forest, L'Heureux-Dubé,

Sopinka, Gonthier, Cory,

McLachlin and Iacobucci, JJ.

May 25, 1995.

Summary:

Thibaudeau was divorced and had custody of her two children. The husband was ordered to pay monthly alimony payments for the children. Thibaudeau refused to include the alimony she received on behalf of the children in 1989 as her income for income tax purposes. The Minister of Na­tional Revenue ruled that the alimony was part of her income pursuant to s. 56(1)(b) of the Income Tax Act. Thibaudeau appealed, arguing that s. 56(1)(b) violated her equality rights under s. 15(1) of the Charter.

The Tax Court of Canada, in a decision reported 92 D.T.C. 1098, dismissed Thibaudeau's appeal. Thibaudeau applied for judicial review.

The Federal Court of Appeal, Létourneau, J.A., dissenting, in a decision reported 167 N.R. 161, allowed the application, set aside the Tax Court's decision and remitted the matter to the Tax Court for redetermination on the basis that s. 56(1)(b) of the Income Tax Act violated Thibaudeau's rights under s. 15 of the Charter. The Minister of Na­tional Revenue appealed.

The Supreme Court of Canada, L'Heureux-Dubé and McLachlin, JJ., dis­senting allowed the appeal. The court held that s. 56(1)(b) did not infringe the equality rights guaranteed by s. 15 of the Charter.

Civil Rights - Topic 918

Discrimination - Family status - What constitutes - The Income Tax Act, s. 56(1)(b), provided that periodic alimony payments received by separated spouses for themselves or their children under a decree, court order or judgment, or written agreement were taxable - The Federal Court of Appeal held that s. 56(1)(b) was contrary to s. 15(1) of the Charter because it discriminated against "separated cus­todial parents" (i.e., on the basis of family status - a ground analogous to those enumerated in s. 15(1)) - The Supreme Court of Canada held that s. 56(1)(b) did not infringe the equality rights guaranteed by s. 15 of the Charter.

Civil Rights - Topic 5516

Equality and protection of the law - Tests for inequality - The Supreme Court of Canada determined that the Income Tax Act, s. 56(1)(b), respecting taxation of alimony was not contrary to s. 15 of the Charter - Gonthier, J., applied the three stage analysis he set out in Miron v. Trudel, 181 N.R. 253 - Cory and Iacobucci, JJ., stated that as per their joint reasons in Egan and Nesbit v. Canada, 182 N.R. 161, and their agreement with Mc­Lachlin, J.'s, approach to s. 15 as expressed in Miron v. Trudel, they could not support Gonthier, J.'s, approach to s. 15 - Sopinka, J. (La Forest, J., con­curring), agreed that there was no violation of s. 15 - See paragraphs 36 to 102 - L'Heureux-Dubé, J., dissent­ing, applied the framework she set out in Egan and Nesbit v. Canada - McLachlin, J., also dissenting, applied the two stage analysis she set out in Miron v. Trudel - See para­graphs 103 to 165, 177 to 237.

Civil Rights - Topic 5679

Equality and protection of the law - Income tax - The Income Tax Act, s. 56(1)(b), provided that periodic alimony payments received by separated spouses for themselves or their children under a decree, court order or judgment, or written agreement were taxable - Section 60(b) provided that the payor could deduct the maintenance payments from income - A custodial parent who received alimony payments for her two children argued that s. 56(1)(b) violated her equality rights contrary to s. 15 of the Charter - The Supreme Court of Canada examined this "inclusion/deduction" scheme and held that s. 56(1)(b), the inclusion provision, did not infringe the equality rights guaranteed by s. 15 of the Charter - See paragraphs 1 to 102.

Civil Rights - Topic 8668

Canadian Charter of Rights and Freedoms - Equality rights (s. 15) - What consti­tutes a breach of s. 15 - [See Civil Rights - Topic 5679 ].

Civil Rights - Topic 8672

Canadian Charter of Rights and Freedoms - Equality rights (s. 15) - Analogous categories - [See Civil Rights - Topic 918 ].

Income Tax - Topic 2082

Other sources of income - Alimony and maintenance payments - Periodic pay­ments - [See Civil Rights - Topic 5679 ].

Income Tax - Topic 2602

Deductions in computing income - Ali­mony and maintenance payments - Peri­odic payments - [See Civil Rights - Topic 5679 ].

Cases Noticed:

Droit de la famille-1488, J.E. 91-1753 (Que. C.A.), refd to. [para. 10].

Parker v. Parker, [1988] O.J. No. 749 (C.A.), refd to. [para. 10].

Chelmick v. Chelmick (1991), 118 A.R. 385 (Q.B.), refd to. [para. 10].

Lehmann v. Lehmann (1989), 95 A.R. 383 (Q.B.), refd to. [para. 10].

Treen v. Treen (1991), 88 Sask.R. 278 (Q.B.), refd to. [para. 10].

Girard v. Girard (1990), 103 N.B.R.(2d) 377; 259 A.P.R. 377 (Fam. Div.), refd to. [para. 10].

Symes v. Minister of National Revenue, [1993] 4 S.C.R. 695; 161 N.R. 243, dist. [paras. 13, 96, 107, 229].

Andrews v. Law Society of British Columbia, [1989] 1 S.C.R. 143; 91 N.R. 255; 56 D.L.R.(4th) 1, refd to. [paras. 14, 177].

R. v. Swain, [1991] 1 S.C.R. 933; 125 N.R. 1; 47 O.A.C. 81; 63 C.C.C.(3d) 481, refd to. [paras. 14, 223].

R. v. Oakes, [1986] 1 S.C.R. 103; 65 N.R. 87; 14 O.A.C. 335; 26 D.L.R.(4th) 200; 50 C.R.(3d) 1; 24 C.C.C.(3d) 321; 19 C.R.R. 308, refd to. [paras. 15, 177].

R. v. Turpin, Siddiqui and Clauzel, [1989] 1 S.C.R. 1296; 96 N.R. 115; 34 O.A.C. 115; 48 C.C.C.(3d) 8; 69 C.R.(3d) 97; 39 C.R.R. 306, refd to. [para. 17].

R. v. Big M Drug Mart Ltd., [1985] 1 S.C.R. 295; 58 N.R. 81; 60 A.R. 161; [1985] 3 W.W.R. 481; 18 C.C.C.(3d) 385; 18 D.L.R.(4th) 321; 37 Alta. L.R.(2d) 97; 85 C.L.L.C. 14,203; 13 C.R.R. 64, refd to. [para. 25].

Gagnon v. Minister of National Revenue, [1986] 1 S.C.R. 264; 65 N.R. 321; 86 D.T.C. 6179, refd to. [para. 30].

Miron and Valliere v. Trudel et al. (1995), 181 N.R. 253 (S.C.C.), refd to. [paras. 39, 91, 103, 177].

Tétreault-Gadoury v. Canada Employment and Immigration Commission, [1991] 2 S.C.R. 22; 126 N.R. 1; 81 D.L.R.(4th) 358, dist. [paras. 49, 229].

Hodson v. Minister of National Revenue, [1988] 1 C.T.C. 2; 82 N.R. 308 (F.C.A.), refd to. [para. 52].

Moge v. Moge, [1992] 3 S.C.R. 813; 145 N.R. 1; 81 Man.R.(2d) 161; 30 W.A.C. 161; [1993] 1 W.W.R. 481; 99 D.L.R.(4th) 456; 43 R.F.L.(3d) 345, refd to. [para. 63].

Young v. Young et al., [1993] 4 S.C.R. 3; 160 N.R. 1; 34 B.C.A.C. 161; 56 W.A.C. 161; [1993] 8 W.W.R. 513; 84 B.C.L.R.(2d) 1; 18 C.R.R.(2d) 41; 49 R.F.L.(3d) 117, refd to. [para. 73].

Egan and Nesbit v. Canada (1995), 182 N.R. 161 (S.C.C.), refd to. [paras. 91, 103].

Schaff v. Canada, [1993] 2 C.T.C. 2695 (Tax. C.C.), refd to. [para. 130].

Willick v. Willick, [1994] 3 S.C.R. 670; 173 N.R. 321; 125 Sask.R. 81; 81 W.A.C. 81; 6 R.F.L.(4th) 162, refd to. [paras. 145, 199].

R. v. Videoflicks Ltd. et al., [1986] 2 S.C.R. 713; 71 N.R. 161; 19 O.A.C. 239; 30 C.C.C.(3d) 385; 55 C.R.(3d) 193; 35 D.L.R.(4th) 1; 28 C.R.R. 1, refd to. [para. 177].

Edwards Books and Art Ltd. v. R. - see R. v. Videoflicks Ltd. et al.

R. v. Edwards Books and Art Ltd. - see R. v. Videoflicks Ltd. et al.

Black & Co. v. Law Society of Alberta, [1989] 1 S.C.R. 591; 93 N.R. 266; 96 A.R. 352, refd to. [para. 177].

Irwin Toy Ltd. v. Québec (Procureur général), [1989] 1 S.C.R. 927; 94 N.R. 167; 24 Q.A.C. 2; 58 D.L.R.(4th) 577; 25 C.P.R.(3d) 417, refd to. [para. 177].

R. v. Chaulk and Morrissette, [1990] 3 S.C.R. 1303; 119 N.R. 161; 69 Man.R.(2d) 161; [1991] 2 W.W.R. 385; 62 C.C.C.(3d) 193; 1 C.R.R.(2d) 1; 2 C.R.(4th) 1, refd to. [para. 223].

Canadian Broadcasting Corp. v. Dagenais et al., [1994] 3 S.C.R. 835; 175 N.R. 1; 76 O.A.C. 81, refd to. [para. 233].

Schachter v. Canada et al., [1992] 2 S.C.R. 679; 139 N.R. 1; 93 D.L.R.(4th) 1, refd to. [para. 240].

Statutes Noticed:

Canadian Charter of Rights and Freedoms, 1982, sect. 1 [para. 21]; sect. 15 [paras. 21, 23 et seq.].

Civil Code of Lower Canada, art. 30 [para. 73].

Civil Code of Quebec, S.Q. 1980, c. 39, art. 635 [para. 73]; art. 638 [para. 3].

Civil Code of Quebec, S.Q. 1991, c. 64, art. 33, art. 587 [para. 73]; art. 590 [para. 3].

Divorce Act, R.S.C. 1985 (2nd Supp.), c. 3, sect. 15(5), sect. 15(8)(a) [para. 73].

Family Allowances Act, R.S.C. 1985, c. F-1, sect. 7(1) [para. 82].

Income Tax Act, Interpretation Bulletins, Interpretation Bulletin IT-307R2, "Registered Retirement Savings Plan for Taxpayer's Spouse" (July 12, 1984), generally [para. 110].

Income Tax Act, S.C. 1970-71-72, c. 63, sect. 3(a), sect. 56(1)(b), sect. 60(b) [para. 22]; sect. 118(1)(b), sect. 118(1)(d) [paras. 81, 230]; sect. 118(5) [para. 82]; sect. 122.2 [paras. 81, 230].

Interpretation Bulletins - see Income Tax Act.

Old Age Security Act, R.S.C. 1985, c. O-9, generally [para. 98].

Authors and Works Noticed:

Canada, Department of Justice, Bureau of Review, Evaluation of the Divorce Act - Phase II: Monitoring and Evaluation (1990), generally [paras. 208, 236].

Canada, Hansard, House of Commons Debates, vol. V., 3rd Sess. 19th Parl., July 17, 1942, pp. 4360-4361 [para 173].

Canadian Institute for Research and the Steering Committee, Matrimonial Sup­port Failures: Reasons, Profiles and Perceptions of Individuals Involved (1981), generally [paras. 208, 236].

Chambers, David L., Making Fathers Pay: The Enforcement of Child Support, Uni­versity of Chicago Press (1979), gener­ally [paras. 208, 236].

Côté, Pierre-André, The Interpretation of Legislation in Canada (2nd Ed. 1991), p. 258 [para. 48].

Durnford, John W., and Stephen J. Toope, Spousal Support in Family Law and Alimony in the Law of Taxation (1994), 42 Can. Tax J. 1, generally [para. 160].

Eichler, Margrit, The Limits of Family Law Reform or The Privatization of Female and Child Poverty (1991), 7 C.F.L.Q. 59, p. 61 [paras. 208, 236].

Federal/Provincial/Territorial Family Law Committee, The Financial Implications of Child Support: Guidelines Research Report (1992), pp. 90 [para. 197]; 91 [paras. 181, 194, 198, 220].

Hansard - see Canada, Hansard, House of Commons Debates.

La Novara, Pina, A Portrait of Families in Canada, Statistics Canada (1993), pp. 10 [para. 209]; 11 [para. 211]; 15 [para. 209]; 18 [para. 211]; 21 [para. 176].

Maclean, Mavis, and John M. Eekelaar, The Economic Consequences of Divorce for Families with Children, in The Reso­lution of Family Conflicts: Comparative Legal Perspectives, J.M. Eekelaar and S.N. Katz (eds.) (1984), p. 488 [para. 208].

McLindon, James B., Separate But Unequal: The Economic Disaster of Divorce for Women and Children (1987), 21 Fam. L.Q. 351, generally [paras. 208, 236].

Pask, E. Diane, and M.L. McCall (eds.), How Much and Why? Economic Impli­cations of Marriage Breakdown: Spousal and Child Support, Calgary, Canadian Research Institute for Law and the Fam­ily (1989), pp. 76 to 78 [paras. 208, 236].

Weitzman, Lenore, J., The Divorce Revo­lution: The Unexpected Social and Eco­nomic Consequences for Women and Children in America (1985), generally [paras. 208, 236].

Weston, R.E., Changes in Household Income Circumstances, in P. McDonald (ed.), Setting Up: Property and Income Distribution on Divorce in Australia (1986), p. 100 [para. 208].

Williams, R. James, Quantification of Child Support (1989), 18 R.F.L.(3d) 234, generally [paras. 208, 236].

Wishik, Heather Ruth, Economics of Divorce: An Exploratory Study (1986), 20 Fam. L.Q. 79, generally [paras. 208, 236].

Zweibel, Ellen B., Thibaudeau v. R.: Con­stitutional Challenge to the Taxation of Child Support Payments (1994), 4 N.J.C.L. 305, pp. 334 [para. 146]; 342 [para. 140].

Zweibel, Ellen B., and Richard Shillington, Child Support Policy: Income Tax Treatment and Child Support Guidelines (1993), p. 17 [paras. 129, 130].

Counsel:

Jean-Marc Aubry, Q.C., Carole Johnson and Guy Laperrière, for the appellant;

Michel C. Bernier, Richard Bourgault, Pierre Rioux and Bryan O'Gallagher, for the respondent;

Monique Rousseau, René Bourassa and Judith Kucharsky, for the intervener, the Attorney General of Quebec;

Mary Eberts and Steve Tenai, for the intervener SCOPE;

Katherine Hardie and Gwen Brodsky, for the intervener, the Coalition.

Solicitors of Record:

John C. Tait, Q.C., Deputy Attorney Gen­eral of Canada, Ottawa, Ontario, for the appellant;

Bernier, Beaudry, Sainte-Foy, Quebec, for the respondent;

Department of Justice, Sainte-Foy, Que­bec, for the Attorney General of Quebec;

Mary Eberts and Tory Tory DesLauriers & Binnington, Toronto, Ontario, for the intervener, SCOPE;

B.C. Public Interest Advocacy Centre, Vancouver, British Columbia, for the intervener, the Coalition.

This appeal was heard on October 4, 1994, before La Forest, L'Heureux-Dubé, Sopinka, Gonthier, Cory, McLachlin and, Iacobucci, JJ., of the Supreme Court of Canada. The decision of the court was delivered on May 25, 1995, in both official languages, includ­ing the following opinions:

Gonthier, J. - see paragraphs 1 to 89;

Sopinka, J. (La Forest, J., concurring) - see paragraph 90;

Cory and Iacobucci, JJ., joint concurring reasons - see paragraphs 91 to 102;

L'Heureux-Dubé, J., dissenting - see paragraphs 103 to 165;

McLachlin, J., dissenting - see para­graphs 166 to 248.