The taxpayer was assigned by his father an annuity paying $5,500 of interest annually and with an original term of 20 years. The taxpayer later surrendered the annuity to the issuer at a gain.
In finding that the lump sum received by the taxpayer was not taxable under s. 56(1)(d) (with the result that the taxpayer was subject to capital gains treatment) Mogan TCJ. stated (at p. 1148) that "in the workaday world, an annuity is an amount payable yearly" and that the definition of annuity in s. 248(1) only expanded this meaning "to include intervals longer or shorter than a year", and did not cover a large once-and-for all payment.