The Court rejected a submission on behalf of the taxpayers that their losses with respect to interests in a real estate project that they acquired as tenants in common should be found to be on income account because the projects had been promoted by two other co-tenants who had been found in Grant v. The Queen, 2002 DTC 1985 (TCC) to be the dominant minds with respect to some other real estate projects. Sharlow J.A. stated (at p. 6782):
"Where property is owned by tenants in common and there is no bar to the separate disposition of the interest of a co-tenant, it is a question of fact whether there is a dominant or directing mind for the group. Where a dominant party is found to exist, it is because there is evidence that some co-owners have expressly or implicitly acquiesced in decisions made by the dominant co-owner with respect to the property."
There was no such evidence in this case, and the taxpayers held their interest on capital account.