JES Investments Ltd. v. The Queen, 2006 DTC 3608, 2006 TCC 508, aff'd 2007 FCA 337 -- summary under Subsection 66.3(3)

A corporation with which the taxpayer had entered into a flow-through share agreement did not in fact incur CEE or renounce to the taxpayer. In response to an argument of the Crown that once issued as a flow-through share, a share retains its flow-through status even if there is a failure to renounce, Sheridan J. found that given that the agreement was never in fact performed as intended, the shares retained their character as ordinary shares, so that s. 66.3(3) did not apply to deny a capital loss.