After the taxpayer lost his employment in Toronto and purchased a new residence in Quebec, he was unsuccessful in efforts to sell his Toronto residence and eventually rented it to a tenant. A loss realized five years later on a sale of the residence was on capital account.
Lamarre Proulx TCJ, in rejecting a submission that the residence had been converted to inventory when the taxpayer vacated it, stated (at p. 151) that:
The circumstances of the purchase, the offering for sale and the renting of the appellant's family residence do not reflect an intention to trade. [There are] many taxpayers who want to acquire and protect an investment. A taxpayer may be concerned with the resale value of his principal residence. Depending on the market circumstances, he may also wait a few years before reselling the main residence he has ceased to occupy. All this is normal and does not convert the gain from the sale of the house to a business gain.