S.69(1)(a) applied to reduce the capital cost to a partnership of depreciable property purchased by it to the property's fair market value rather than the higher purchase price given that the same individual controlled both the vendor and the general partner of the partnership (as well as being the sole initial limited partner at the time of the purchase). Noël J.A. stated (at p. 5276) that:
"A partnership must be regarded as a separate person for the purpose of computing income with the result that the rules prescribed in Division B (Computation of Income), including paragraph 69(1)(a), apply to a partnership as if it were a person."
It was not relevant that some of the limited partners, who dealt at arm's length with the controlling individual, subscribed for units in the partnership in the year of the purchase, but subsequent to the time of the purchase.