McLeod v. City of Windsor

McLeod v. City of Windsor

Majority: trustee not assessable for the portion of income required by the will to be accumulated for a term where beneficiaries are unascertained or unborn; therefore the municipal assessment on the accumulated income was invalid and the appeal from the Appellate Division was allowed. The Court avoided deciding the constitutional validity of s.13(1). The separate declaratory action was dismissed for want of a sufficient interest after the appellate disposition.

Citation
[1923] SCR 696
Parties
Appellant / Plaintiff (surviving Trustee): James Barber McLeod; Respondent / Municipal Corporation: The City of Windsor
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
14 June 1923
Procedural Posture
Appeal (tax Assessment) and Declaratory Judgment Action / On Appeal to the Supreme Court of Canada From the Appellate Division of the Supreme Court of Ontario; Per Saltum From County Court in Respect of Declaratory Action
Outcome
Appeal from Appellate Division allowed; appeal from Orde J. (declaratory action) dismissed.
Legal Topics
Income Tax Assessment, Trustee Liability, Direct Vs Indirect Taxation, Interpretation of Assessment Act (r.s.o. 1914 C.195), Declaratory Relief
Source Language
English
Taxation Constitutional Law Trusts and Estates Procedural Law Income Tax Assessment Trustee Liability Direct Vs Indirect Taxation Interpretation of Assessment Act (r.s.o. 1914 C.195) +1 more

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Parties

James Barber McLeod

Appellant / Plaintiff (surviving Trustee)

The City of Windsor

Respondent / Municipal Corporation

Procedural Posture

Appeal (tax Assessment) and Declaratory Judgment Action / On Appeal to the Supreme Court of Canada From the Appellate Division of the Supreme Court of Ontario; Per Saltum From County Court in Respect of Declaratory Action

Legal Issues

  1. 1 Whether a trustee can be assessed for income required by a will to be accumulated for a term pending distribution to presently unknown or unborn beneficiaries
  2. 2 Whether ss.5 and 13(1) of the Ontario Assessment Act authorize assessing a trustee for income held for non-resident beneficiaries and whether such provisions are ultra vires as imposing indirect taxation
  3. 3 Whether a person assessed may bring a separate declaratory action to challenge the constitutionality of the taxing statute despite statutory appeal provisions

Ratio Decidendi

Majority: trustee not assessable for the portion of income required by the will to be accumulated for a term where beneficiaries are unascertained or unborn; therefore the municipal assessment on the accumulated income was invalid and the appeal from the Appellate Division was allowed. The Court avoided deciding the constitutional validity of s.13(1). The separate declaratory action was dismissed for want of a sufficient interest after the appellate disposition.

Court Disposition

Appeal from Appellate Division allowed; appeal from Orde J. (declaratory action) dismissed.

Orders

  • Appeal from the Appellate Division allowed; assessment on accumulated income set aside; costs in that court and in the Supreme Court of Canada to be paid by the municipal corporation to the appellant.
  • Appeal from the judgment of Orde J. dismissing the declaratory action dismissed; costs (including those of the Attorney General) to be paid by the appellant.