The taxpayer entered into "leasing contracts" respecting heavy equipment which typically had a term of approximately five years, provided for monthly rental payments, provided that five months before the expiry date the taxpayer could exercise an option to purchase the equipment for a sum equal to the remaining rentals, and provided that the taxpayer was responsible for the maintenance and good condition of the equipment.
Lamarre Proulx TCJ. found (at p. 1384) that the definition of "depreciable property" meant that:
"A taxpayer's depreciable property is property for which he or she has already claimed and received deductions, and in respect of deductions for the current year, it is property which the taxpayer owns at the end of the year."
Furthermore, she found (at p. 1385) that "the words 'property acquired' must be taken to mean property in which the taxpayer has a right of ownership, or if not such a right, then all the attributes of a right of ownership, as in the case of a conditional sale". Accordingly, because the taxpayer neither owned the property nor had acquired it, it was not entitled to capital cost allowance.