The taxpayer had deliberately permitted a business colleague to mislead an investor ("Bhandar") into thinking that the taxpayer and his colleague had already invested significant sums in a business venture in which they were asking Bhandar to invest. After finding that damages for deceit that the taxpayer was required to pay to Bhandar were, in any event, not deductible because there was no evidence that the taxpayer's efforts to obtain Bhandar's money by deception were connected with a business or a venture in the nature of trade of the taxpayer, Rip T.C.J. went on to indicate (at p. 381):
However, even if I erred in so concluding, the actions of Mr. Bains in usurping money out of Mr. Bhandar is the egregious or repulsive breach that Iacobucci, J. states [in the 65302 case] could not be justified as being incurred for the purpose of producing income.