Mrs. Bueti, who was entitled to receive 1/3 of the residue of estate of her father (who died in August 1999), was found to have purchased, as joint tenant with her husband, a property (a house) included in her father estate for consideration of $50,000, which was less than its fair market value at the time of the July 2000 purchase.
In finding that s. 70(5)(b) did not apply to deem the house to have been acquired for its higher fair market value, Owen J found (after emphasizing, at para. 53, that the property was not devised in specie to any beneficiary) (i) that under Ontario law the property became vested in the executors and not the beneficiaries including the taxpayer (noting, at para. 56, that 909403 Ontario Ltd. v. DiMichele, 2014 ONCA 261 "confirmed that an entitlement to the residue of an estate under a will does not amount to a property interest in specific estate assets,") so that the property was acquired by the executors rather than the taxpayer (para. 59), and (ii) that the transfer to the taxpayer and her husband (who was not a beneficiary) as joint owners was inconsistent with the property being acquired qua beneficiary. S. 248(8)(a) was not discussed.
Accordingly, a gain on a subsequent disposition of the property (by gift in 2004, after it had become a rental property) was based on the property's lower actual cost.