Partly as a delayed consequence of CRA’s seizure of computers and dental equipment of a dental practice and the misplacing of records when his practice subsequently was closed, the dentist was only able to collect a portion of the revenues that he had included in his 2005 to 2008 returns. However, the Tax Court found that he was not entitled to a bad debt deduction on the basis inter alia that he was unable to identify which specific debts had gone bad. In agreeing with this finding, and before going on to find that there was no reversible error, Boivin JA stated (at para. 5):
[T]he Appellant did not provide particulars regarding who his debtors were or how much they owed. … [I]n order to have a “liquidated money demand, recoverable by action” one must know the identity of the debtor and the amount owed … .
Respecting the taxpayer’s argument that “he could not accurately calculate his deduction for bad debts because the CRA did not keep records of which debts were satisfied as a result of garnishment,” Boivin JA stated (at para. 6):
Had the Appellant produced reliable records of services rendered and fees owing, he would have been able to provide a reliable estimate of bad debts. The onus would have then shifted to the CRA to show that it collected some of the debts through garnishment.