An individual who had been receiving long-term disability benefits after an illness had prevented continuation of the individual’s employment, brought an action when the insurance company ceased the benefit payments. The action was settled after the individual’s death by payment to the estate of long-term disability benefits that were unpaid during the individual's lifetime, and a survivor's benefit. After noting that the disability payments received by the individual would have been taxable during the individual’s lifetime under s. 6(1)(f), CRA went on to find that, in accordance with Tsiaprailis, the amount of the settlement that was referable to such unpaid amounts was taxable, and then found that the rights and things alternative was available, stating:
[I]f the portion of the amount paid by the insurance company following the out-of-court settlement as long-term disability benefits related to periodic benefits that had fallen due, such benefits received by the estate in 2008 would constitute a right, or thing since at the time of his death it appears to us that the individual had a legal right to the said benefits and that its amount could be determined by the parties.