Canada v Antosko

Holding

Where the words of the Income Tax Act are clear and unambiguous, they must be applied according to their ordinary meaning even if the resulting tax consequences appear anomalous or unintended.

Facts

The taxpayers acquired distressed debt at a discount from a Crown corporation. They claimed interest deductions under former paragraph 20(14)(b) on interest that had accrued before acquisition but was paid to them after acquisition. The Minister argued the provision should not apply because the parties were not at arm's length on the original loan.

Reasoning

Justice Iacobucci, writing for a unanimous Court, held that the statutory conditions of paragraph 20(14)(b) were plainly met on the facts. The Court declined to read in a purposive limitation, emphasising that where the provision is detailed and unambiguous, courts must respect the words Parliament chose. The case became a touchstone for the plain-meaning approach later refined in Stubart and Canada Trustco.