Mr. Y and Ms. X , who were the undivided co-owners of a duplex, with each occupying one of the two constituent housing units, disposed of the building and designated their housing unit as their principal residence for the three years they lived there. Before finding that each use could use the principal residence exemption to completely shelter their respective gains under s. 40(2)(b), CRA stated:
In the case where each of the co-owners has the exclusive right to live in his or her own unit, the value of their undivided share must take into account at the same time the exercise by each of them of the exclusive use and enjoyment of their unit, which necessarily includes the right to the use of the common parts of the building, and the prohibition on the use of the unit occupied by the other co-owner. Consequently, even if a person legally is selling his or her undivided interest in an immovable, the value of that share is attributable to the unit he or she lives in and is disposing of for the purposes of the Act.