A subdivision property of the taxpayer, a developer, was blockaded by Six Nations protesters. To diffuse the conflict, the Ontario government passed a by-law prohibiting any use of the property (rendering it valueless), and then agreed to pay the taxpayer $15,800,000 in exchange for relinquishing its rights to the property and under a court order against the protesters, and for a release.
After finding that the $15,800,000 was a capital receipt which was not income under s. 9 (see s. 9 - compensation payments), C Miller J found in applying the mirror image rule that, as the hypothetical consideration which the taxpayer would have received for a hypothetical payment by it of the $15,800,000 would have been the loss of its goodwill (para. 199), which would not have qualified as an eligible capital expenditure, the (actual) $15,800,000 payment received was not an eligible capital amount.