A-24-86
Michel Larivière (Appellant)
v.
The Queen (Respondent)
INDEXED AS: LARIVIÈRE V. CANADA (C.A.)
Court of Appeal, Pratte, Hugessen and Desjardins
JJ.—Québec, October 13, 1988.
Income tax — Income calculation — Deductions — Alimo
ny and maintenance payments — Whether s. 60(6) of Income
Tax Act authorized deduction of $10,000 required to be paid
under Quebec decree nisi of divorce — Trial Judge disallowed
deduction as not within statutory provision — Words "pension
alimentaire" as used in French text of s. 60(b) did not have
same meaning as under Quebec civil law — Words reflect
translation of English "alimony" referring to allowance paid
to spouse by married person — Amount paid after marriage
dissolved not deductible as alimony — Whether amount paid
as allowance payable on periodic basis for maintenance —
Periodic allowance, sum payable in variable amounts enabling
payee to provide in part for maintenance until next payment —
Taxpayer's $10,000 payment deductible as periodic allowance
for maintenance.
Construction of statutes — "Pension alimentaire" in French
version of Income Tax Act, s. 60(b) — Not having interpreta
tion given by Quebec civil law — Translation of English word
"alimony" which refers to allowance paid when married
Amounts paid after divorce not "alimony".
This was an appeal against the Trial Division's decision
allowing in part the appellant's appeal against income tax
assessments for the 1978 and 1979 taxation years. The appel
lant was compelled to pay $10,000 to his ex-wife under a decree
nisi of divorce rendered in 1979 by the Quebec Superior Court.
The Trial Judge did not allow the deduction of the payment as
it was neither "alimony" nor an "other allowance payable on a
periodic basis" as these terms are used under paragraph 60(b)
of the Income Tax Act.
Held, the appeal should be allowed.
The Trial Judge was correct in his determination that the
words "pension alimentaire" in the French text of paragraph
60(b) do not have the interpretation given to them by Quebec
civil law. These words translate the English word "alimony"
and refer to the allowance a spouse is required to pay while
married. Once the marriage is dissolved, amounts paid by the
former spouse can no longer be deducted as alimony under
paragraph 60(b).
The Trial Judge also held that the amount paid by the
appellant to his ex-wife could not be deducted as an "allowance
payable on a periodic basis for the maintenance of the recipient
thereof ' in light of the decision in Veliotis v. The Queen.
The Judge in the Veliotis case, now rendering reasons in this
appeal, would, if now writing the reasons in Veliotis, vary them
to say that the periodic allowance referred to in paragraph
60(b) need only provide for maintenance, at least in part, until
the next payment. The statement in Veliotis, that a judgment
does not create an obligation to pay an allowance on a periodic
basis if it does not require payment of the same sum at regular
interval, was incorrect. Variable amounts payable on a periodic
basis can be deducted under paragraph 60(b).
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Divorce Act, R.S.C. 1970, c. D-8, s. 1 1(1)(a)(i).
Income Tax Act, S.C. 1970-7I-72, c. 63, s. 60(b).
CASES JUDICIALLY CONSIDERED
OVERRULED:
Veliotis v. The Queen, [1974] 1 F.C. 3 (T.D.).
COUNSEL:
Raymond Nepveu for appellant.
Paul E. Plourde for respondent.
SOLICITORS:
Gauthier, Nepveu, Leblanc, Brouillette, Ron-
deau & Grégoire, Sept-Îles, Quebec, for
appellant.
Deputy Attorney General of Canada for
respondent.
The following is the English version of the
reasons for judgment delivered orally by
PRATTE J.: The appellant is challenging a judg
ment of the Trial Division [[1986] 1 C.T.C. 206;
(1985), 8 F.T.R. 14] (Pinard J.) which allowed in
part only the appeal brought by him against
income tax assessments for the 1978 and 1979
taxation years.
The only point at issue is whether paragraph
60(b) of the Income Tax Act [S.C. 1970-71-72, c.
63]' authorized the appellant to deduct, in com
puting his income for 1979, the sum of $10,000
which he had to pay his ex-wife under a decree nisi
of divorce rendered on March 13, 1979 by the
Quebec Superior Court.
It was established that the amount in question
was for alimentary purposes. Despite this, the
Trial Judge held that paragraph 60(b) did not
authorize such a deduction because, in his opinion,
it was neither an "alimony" nor an "other allow
ance payable on a periodic basis" within the mean
ing in which paragraph 60(b) uses these expres
sions.
It seems certain that, as the judge said, the
words "pension alimentaire" in the French text of
paragraph 60(b) do not have the general meaning
given to them by Quebec civil law. They were used
to translate the English word "alimony", which
refers only to the allowance a married person must
pay his spouse during the marriage. As the amount
of $10,000 at issue here was paid by the appellant
to his ex-wife after their marriage was dissolved,
that is not the payment of "pension alimentaire"
in the limited sense in which that phrase is used in
paragraph 60(b). The judge was therefore right to
refuse to allow it to be deducted as such.
It remains to determine whether he was right to
find that this amount was not paid as an "allow-
ance payable on a periodic basis for the mainte-
The wording of this provision is as follows:
60. There may be deducted in computing a taxpayer's
income for a taxation year such of the following amounts as
are applicable:
(b) an amount paid by the taxpayer in the year, pursuant
to a decree, order or judgment of a competent tribunal or
pursuant to a written agreement, as alimony or other
allowance payable on a periodic basis for the maintenance
of the recipient thereof, children of the marriage, or both
the recipient and children of the marriage, if he was living
apart from, and was separated pursuant to a divorce,
judicial separation or written separation agreement from,
his spouse or former spouse to whom he was required to
make the payment at the time the payment was made and
throughout the remainder of the year;
nance of the recipient thereof" [at pages 209
C.T.C.; 17 F.T.R.], despite the fact that this was
clearly an amount of an alimentary nature. In
support of this conclusion the judge relied on the
judgment in Veliotis v. The Queen, 2 in which when
I was sitting in the Trial Division I said the
following [at page 8]:
Secondly, the sum of $25,000.00 cannot be said to have been
paid as an "allowance payable on a periodic basis". In my view,
the allowance payable on a periodic basis referred to in section
I 1(l)(1) is periodic in the same sense as alimony, and alimony
is a periodic allowance not only in the sense that the payer must
make payments at regular intervals, but also in the sense that
at regular intervals the payer must provide a sum adequate to
maintain the payee until the next payment. Consequently, a
divorce decree which ordered a husband to pay his spouse the
sum of $100,000.00 in four monthly instalments of $25,000.00
would not in the normal course be a judgment ordering the
payment of a periodic allowance within the meaning of section
I1(1)(/). Moreover, it should be noted that the section refers to
a sum paid as an "allowance payable on a periodic basis". An
allowance is a specific sum of money paid to someone. An
allowance is payable on a periodic basis when a specific sum of
money is payable at regular intervals. A judgment does not
create an obligation to pay an allowance on a periodic basis if it
does not require the payer to pay the same sum of money at
regular intervals. In the case at bar the divorce decree may
impose on the plaintiff an obligation to make certain payments
on a periodic basis; but it does not require him to make a
periodic allowance to his spouse of $25,000.00.
After citing this judgment, the judge concluded
that the sum of $10,000 was not paid "as ... [an]
allowance payable on a periodic basis", first
because it was not established that this amount
was "adequate to maintain" [at pages 210
C.T.C.; 18 F.T.R.] the appellant's ex-wife during
the period for which the amount was paid, and
second, because it was paid under a decree requir
ing him to make unequal periodic payments.
I should like to make two observations regarding
the reasons for judgment rendered by me in Velio-
tis. If I had to write them over again, I would not
say that the periodic allowance referred to in
paragraph 60(b) must be a sum "adequate to
maintain the payee until the next payment": I
would instead write that it must be an amount
paid to enable the payee to provide for her mainte -
2 [1974] 1 F.C. 3 (T.D.).
nance, at least in part, until the next payment
rather than for the purpose of allowing her to
accumulate a capital sum. As regards the state
ment that a judgment does not create an obligation
to pay an allowance on a periodic basis if it does
not require the payer to pay the same sum of
money at regular intervals, I now feel this is
incorrect. I now believe that an allowance payable
on a periodic basis can be a variable amount.
Having said this, the question for solution as I
understand it is as to whether the decree under
which the $10,000 payment was made imposed an
obligation to make periodic payments for the pur
pose of enabling the appellant's ex-wife to main
tain herself during the period for which these
payments were made, rather than enabling her to
establish a capital sum. The answer at first sight
seems easy. The Superior Court judge said that,
instead of ordering the appellant to pay "an ali
mentary pension in monthly instalments", he
relied on the provisions of subparagraph
11(1)(a)(î) of the Divorce Act [R.S.C. 1970, c.
D-8] 3 to "make an order directing the applicant to
pay the respondent the total sum of $20,000, to be
paid in instalments as follows, namely: $10,000
payable on April 1 next, followed by two further
annual, equal and consecutive payments of $5,000
each payable on April 1, 1980 and 1981 respec
tively". One is inclined to think on reading this
passage from the judgment that, rather than
ordering the appellant to pay an alimentary pen
sion (within the meaning given to that term in
Quebec civil law), the judge intended to order him
to pay a lump sum.
3 At that time the wording of this section was as follows:
11. (1) Upon granting a decree nisi of divorce, the court
may, if it thinks it fit and just to do so having regard to the
conduct of the parties and the condition, means and other
circumstances of each of them, make one or more of the
following orders, namely:
(a) an order requiring the husband to secure or to pay
such lump sum or periodic sums as the court thinks
reasonable for the maintenance of
(i) the wife
If, however, the Superior Court judge's reasons
for judgment are examined carefully, it becomes
clear that despite the language used by him his
intention was to order the appellant to pay an
annual alimentary pension for a fixed three-year
term. The appellant's wife received a provisional
alimentary pension from her husband at the time
of the divorce of $1,075 a month, plus the cost of
her rental. The first payment of the "total sum"
was therefore much less than that of the pension
hitherto paid by the appellant. Even more impor
tant, the judge indicated that he regarded the
payment of the "total sum" of $20,000 to the
appellant's ex-wife as a temporary provision allow
ing her to reorganize her life, complete her train
ing and begin a new life. The three payments of
$10,000, $5,000 and $5,000 were therefore income
rather than capital for the person receiving them:
they were payable periodically for her mainte
nance; they were therefore deductible in comput
ing the appellant's income.
I would allow the appeal with costs and vary the
Trial Division judgment to read as follows:
The appeal is allowed with costs and the assessments regard
ing income tax payable by the appellant in 1978 and 1979 are
referred back to the Minister for reconsideration and reassess
ment on the basis that in computing his income for the years in
question, the appellant was entitled to deduct the amounts he
claimed to be able to deduct under paragraph 60(b) of the
Income Tax Act.
HUGESSEN J. concurred.
DESJARDINS J. concurred.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.