The Queen v. Trade Investments Shopping Centre Ltd., 93 DTC 5486, [1993] 2 CTC 333 (FCTD) -- summary under Transitional Provisions and Policies

The transitional provision for the introduction of s. 13(21.1)(a) of the Act, which excluded from the application of that section dispositions "occurring pursuant to the terms of an agreement in writing entered into on or before [May 9, 1985]" was found to provide relief for a disposition of land by the taxpayer to a purchaser who exercised after 1985 a purchase option contained in a lease agreement dated August 31, 1961. An option was a unilateral contract and, therefore, an agreement. Although it was true that an agreement which had the effect of conferring a purchase option was separate from the agreement which occurs when the option is taken up, the transitional provision did not require that the purchase occur "by virtue of" the agreement, but only that it occur "pursuant to" the agreement, which latter phrase had a broad scope. In addition, because s. 13(21.1)(a) impacted only the seller, the transitional provision should be interpreted from the standpoint of the seller, and from that standpoint the fact that an option agreement did not place any obligation on the potential purchaser was of no significance.