Canada v. JES Investments Ltd., 2007 DTC 5608, 2007 FCA 337 -- summary under Flow-Through Share

An exploration company ("Deena") that entered into an agreement styled as a flow-through share agreement with the taxpayer failed to incur any Canadian exploration and development expenses so that its purported renunciation of such expenses was invalid, and then went into receivership. In finding that the shares so issued by Deena were flow-through shares despite these failures, Ryer J.A. stated (at para. 6) "the relevant time to determine whether a share is a flow-through share is the time at which it is issued and the record shows that, at the time the Shares were issued, no breach of the Agreement had been committed by Deena."