Under a “restart” plan, the appellant changed its name, spun out its existing mining assets so that it was a shell with only tax losses, and B.C. real estate companies of two individuals (Grippo and Heung) transferred various real estate assets, including jointly owned properties, to the appellant for consideration that included shares of the appellant. A dual share structure was created so that the interests of Grippo’s and Heung’s companies in the appellant resulted in them having a combined total of 46.56% of the votes and 92.82% of the equity.
Woods JA found no reversible error in the Tax Court’s finding that Grippo and Heung constituted a group in relation to their relevant dealings and in the application by the Tax Court of Deans Knight to deny the carryforward of capital losses by the appellant to the taxation years at issue.