Paragraph (d)
Administrative Policy
1994 A.P.F.F. Round Table, Q. 5
When a property is transferred with a view to securing repayment of a debt or a loan (in this case, a loan from a related company), there is no disposition of property. 106443 Canada Inc. v. The Queen, [1994] E.TC 247 upholds the application of paragraph (d) of the definition of "disposition of property" even if the redemption value of property that has been sold with the right of redemption is different from the value attributed to the property at the time of transfer.
Paragraph (e)
See Also
Manrell v. The Queen, 2002 DTC 1222, Docket: 1999-2167-IT-G (TCC), rev'd 2003 DTC 5225, 2003 FCA 128
The taxpayer and corporations controlled by him disposed of shares of three corporations engaged in manufacturing plastic moulds and caps and received, in addition to sale proceeds for the shares, lump sums (payable in instalments) in consideration for giving non-compete covenants.
McArthur T.C.J. characterized the non-compete payments as consideration for the disposition of the right to compete with the purchaser, with the result that they represented capital gains.
Anderson Estate v. The Queen, 95 DTC 758 (TCC)
The sister-in-law of the deceased who had lived with him for more than 50 years and worked on his farm venture jointly with him for most of that period without any pay, was found to have an inchoate interest in the farm by virtue of a constructive trust. Accordingly, a transfer to her of a portion of the farm lands following an action brought by her against the estate was found not to entail a disposition of such property by the estate, nor was there a deemed disposition of property under s. 70(5).
Administrative Policy
22 December 1997 T.I. 5-971957 -
The conversion of ownership of personal use real estate from a joint tenancy to a tenancy in common would not constitute a disposition or a partition.
29 November 1996 T.I. 963204 (C.T.O. "Voting Trust, Is Disposition Recognized on Transfer")
Income Tax Technical News, No. 7 gives a general indication of their criteria that are considered by RC in determining whether a transfer of shares to a voting trust results in a change of beneficial ownership.
Income Tax Technical News, No. 7, 21 February 1996
"A revocable living trust should be recognized for income tax purposes at the time that legal title to property is transferred to it and ... the transfer of the property is at its full fair market value (and not at the value of the remainder interest only)."
However, "transfers of property to a protective trust will not result in a disposition ...".
28 October 1994 T.I. 941863 (C.T.O. "Transfer Property to a Bare Trust")
Where legal title to a property is transferred to a bare trust without a corresponding transfer of beneficial ownership, there is no disposition of property.
5 August 1994 T.I. 941285 (C.T.O. "Health and Welfare Trust and Variances to a Trust")
The transfer of property from one health and welfare trust into a new health and welfare trust will not result in a disposition where the new trust has the same terms as the old trust except for administrative matters, such as the number of meetings to be held and how the meetings are to be conducted. In addition, provisions for naming replacement trustees, or extending or amending powers of trustees, would not normally create a taxable event.