[2013] 2 F.C.R. D-2
Employment Insurance
Judicial reviews of five decisions (CUB 77803, CUB 77802, CUB 77801, CUB 77800 and CUB 77799) of Umpire dismissing in part Employment Insurance Commission’s appeals against decisions of Board of Referees concerning calculation of income generated by respondents’ snow-clearing business for purposes of Employment Insurance Act, S.C. 1996, c. 23—Respondents’ business normally active from November to April—Most business expenses arising during this period, but some annually, meaning expenses not limited to November-to-April period exclusively— Employment Insurance Regulations, SOR/96-332, ss. 35, 36 constituting provisions relevant to calculation of income generated by respondents’ business—Commission, purportedly complying with Regulations, s. 35, allocating total gross income from snow-clearing contracts to weeks services performed—Commission doing same for expenses incurred during weeks services performed—Commission allocating so-called annual expenses to 52-week period, meaning only expenses incurred during weeks of snow-clearing activity deducted from respondents’ gross income—Board of Referees modifying Commission’s decisions to allocate income calculated by Commission to 52‑week period instead of period in which services performed—Umpire disagreeing with Commission’s calculation of income under s. 35(10)(c)—According to Umpire, gross income of business must be established on basis of 12-month period, then, in accordance with s. 35(10)(c), operating expenses must be deducted, except capital expenditures, such as capital cost allowance—Umpire then allocating income to weeks in which services performed rather than to all 52 weeks, overturning Board of Referees’ earlier ruling—At issue to which period income calculated pursuant to Regulations, s. 35(10)(c) must be allocated—Period chosen by Commission correct one—Income referred to in s. 35(10)(c) not annual income—Rather, in accordance with s. 36(6), income generated during period in which services performed must be calculated; amount thus calculated must then be allocated to number of weeks in period in question—Under s. 35(10)(c), income respondents earning “from that employment” having to be calculated; period of “that employment” being period in which services performed—As to expenses deductible from income calculated, Commission erring in reducing so-called annual expenses based on number of weeks of activity—According to wording of s. 35(10)(c), expenses respondents may deduct in calculating income from employment being expenses each respondent “incurred” therein—Characterization of expense thus based on purpose thereof, not time expense incurred—In case at bar, all so-called annual expenses incurred for purpose of generating income during snow-clearing period given that respondents’ business having no other source of income—Consequently, all expenses having to be taken into consideration for purpose of calculating income generated during snow-clearing period—Finally, Umpire erring in excluding capital cost allowance from operating expenses under Regulations, s. 35(10)(c)—Only capital expenditures excluded; capital cost allowance not constituting capital expenditure—Applications allowed.
Canada (Attorney General) v. Talbot (A-423-11, A-424-11, A-425-11, A‑426-11, A-427-11, 2013 FCA 53, Noël J.A., judgment dated February 25, 2013, 12 pp.)