The taxpayer, which installed heating, air conditioning and ventilation systems in residential homes, claimed SR&ED credits relating to its "High Static High Velocity Fan Coil System Development" project. The Minister denied the credits on the basis that the project entailed routine engineering.
Hogan J. granted the taxpayer's appeal, subject the $12,000 limit under the informal procedure. The goal of the project was to reduce noise from vents occurring throughout a house, achieve constant static pressure, and adapt a foreign boiler and motor to North American standards in order to use them in a system for which they were not designed and in which they had not previously been tested. These goals entailed substantial technological risk and uncertainty. Based on that finding, and considering the project under the other four factors listed in Northwest Hydraulic, Hogan J. found that the project qualified as SR&ED.