A subsidiary ("PC Bank") of Loblaw had agreed with CIBC for CIBC to provide retail banking services under Loblaw’s President's Choice trademark. Webb JA noted (at para. 27) that Hogan J in the Tax Court had “found that the predominant element of the single compound supply [by PC Bank to CIBC] was a “Bundle of Rights”
[i.e., property] that allowed CIBC to solicit Loblaw’s existing and future customers for the purchase of President’s Choice Financial products.” Hogan J had gone on to find that given that para. (r.5) of the financial service definition provided an exclusion from financial service for “property … that is delivered or made available to” CIBC “in conjunction with” CIBC selling financial products of PC Bank, the supply made by PC Bank to CIBC was taxable.
Webb JA had earlier stated (at paras. 38 - 39) that:
At first blush, it would be expected that it is not necessary to specifically exclude a supply of property from the definition of financial service. However …[b]y adding an exclusion for a supply of property (which Parliament did by adding paragraph (r.5)), Parliament must have been concerned that, without the addition of this exclusion, certain supplies of property could be considered to be a financial service. Parliament does not speak in vain … .
He then concluded (at para. 68):
CIBC has failed to establish that the Tax Court Judge committed any palpable and overriding error in his finding that PC Bank supplied the
“Bundle of Rights”to CIBC.