The King v. Fraser Companies Ltd.

The King v. Fraser Companies Ltd.

The majority held that ss.86 and 87 must be read together to impose the four percent consumption/sales tax on the sale price of all goods produced or manufactured in Canada, and that goods produced for sale but consumed by the manufacturer fall within the taxing scheme because s.87 allows the Minister to treat such...

Source-derived case information.

Citation
[1931] SCR 490
Parties
Plaintiff/appellant: His Majesty The King; Defendant/respondent: Fraser Companies, Limited
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
12 June 1931
Procedural Posture
Taxation Appeal / Appeal to the Supreme Court of Canada From the Exchequer Court on a Special Case Stated
Outcome
Appeal allowed; Exchequer Court judgment reversed (Cannon J. dissenting)
Legal Topics
Consumption Tax, Sales Tax, Manufacturer Consumption, Deeming Provisions
Source Language
english
Taxation Statutory Interpretation Revenue Law Consumption Tax Sales Tax Manufacturer Consumption Deeming Provisions

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Parties

His Majesty The King

Plaintiff/appellant

Fraser Companies, Limited

Defendant/respondent

Procedural Posture

Taxation Appeal / Appeal to the Supreme Court of Canada From the Exchequer Court on a Special Case Stated

Legal Issues

  1. 1 Whether goods produced or manufactured for sale but consumed by the manufacturer are subject to the consumption/sales tax under ss.86 and 87 of the Special War Revenue Act
  2. 2 Whether s.87(d) applies where goods consumed by the manufacturer were manufactured for sale and not specifically for the manufacturer’s own use

Ratio Decidendi

The majority held that ss.86 and 87 must be read together to impose the four percent consumption/sales tax on the sale price of all goods produced or manufactured in Canada, and that goods produced for sale but consumed by the manufacturer fall within the taxing scheme because s.87 allows the Minister to treat such consumption as a sale; therefore the manufacturer is liable for the tax on lumber consumed by it.

Court Disposition

Appeal allowed; Exchequer Court judgment reversed (Cannon J. dissenting)

Orders

  • Appeal allowed with costs
  • Judgment entered for the Crown for the amount claimed with costs