Pine Ridge Property LTD v. Minister of National Revenue, [1973] CTC 201

The Chief Justice:—It is not necessary to call on you Mr Hynes. We are in agreement that the appeal fails. Where the relevant facts as of the time of the purchase are considered together with the subsequent events and the affirmations of the appellant’s shareholders, it is not realistic to conclude that the only possibility that motivated the acquisition was the ultimate creation and retention of a very substantial housing development. Having regard to the problems and delays to be expected by the appellant before it could hope to commence the concrete steps of realization of such a project, such as the creation of detailed plans, the arrangement of permanent financing and the negotiation of contracts, and having regard to the appellant’s lack of financial resources of consequence, one cannot escape the conclusion that, in 1964, the acquisition was a speculation in which, in addition to the hope of an ultimate permanent source of income, the possibility of turning the property to account for profit in any way which might present itself as convenient or expedient, including resale of some earlier stage, was a major motivating factor. Compare Anderson Logging Co v The King, [1925] SCR 45; [1917-27] CTC 198; 52 DTC 1209, for Duff, J, as he then was, at page 49 [201, 1211].