Canada (Attorney General) v. Henley, 2008 DTC 6017, 2007 FCA 370 -- summary under Paragraph 6(1)(a)

By services, 28 November, 2015

The taxpayer, who was an employee of an investment dealer ("Canaccord"), received a portion of the warrants that were issued by a client of Canaccord to Canaccord upon the successful completion of an equity offering by the client. In finding that the taxpayer received a benefit from employment in the year in which the warrants were transferred to him rather than in the subsequent year (following substantial appreciation in the value of the shares of the client) when he exercised those warrants, Ryer J.A. stated (at para. 21):

"To summarize, Robertson may be considered to stand for the proposition that where, in the course of an employment relationship, an employee receives a right to acquire property from his or her employer upon the fulfilment of a condition or contingency, the receipt of that right will not constitute a paragraph 6(1)(a) benefit to the employee and such a benefit will not arise until the condition or contingency has been fulfilled."

Here, as the taxpayer had done all that was required of him in the year in which the warrants were transferred to him, the receipt of the paragraph 6(1)(a) benefit was not deferred until the time of exercise.

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benefit recognition deferred until condition satisfied
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