A mining stock promoter acquired treasury shares of a junior mining company and while he was selling as many shares as he could on The Toronto Stock Exchange also bought substantial quantities of the shares in order "to maintain the market". At the end of his fiscal year (May 31, 1955) his shares had an average cost of 34.1¢ and a market quotation of 67¢.
With respect to determining the fair market value of the shares, Pigeon J. found that "the trial judge was fully justified in holding that there was no evidence that a reasonable program of disposition of the inventory would have brought the market price below cost" (p. 5157). With respect to the cost of the shares, a proposal to specifically identify the shares remaining in the promoter's inventory by an examination of the serial numbers on the certificates ignored the fungibility of shares at law, and there was no convincing evidence that the Fifo method was used to any extent by persons in a situation similar to the promoter's or that this basis of determining cost was "closer to reality" than the average cost basis underlying the reassessment of the Minister. The cost-recovery method also was rejected.