Could the acquisition of a property for consideration of one dollar qualify as an acquisition by gift for purposes of s. 69(1)(c)? The Directorate referred to the relevance of Quebec law per s. 8.1 of the Interpretation Act, and quoted the statement in s. 1806 of the Quebec Civil Code that:
Gift is a contract by which a person, the donor, transfers ownership of property by gratuitous title to another person, the donee.
After noting that the Civil Code contemplates different types of gifts (including "remunerative gifts and gifts with a charge [where only the net amount donated is considered a donation per s. 1810 CCQ]" and that all "such gifts can be gifts for purposes of paragraph 69(1)(c)," the Directorate stated (TaxInterpretations translation):
Thus, the determination of the nature of a particular transaction, to assess whether it is a true gift or sale, must be made on the basis of the legal relationships created by the contract of acquisition of the property. Indeed, in the absence of an express provision to the contrary in the Act or a finding of sham, the legal relationships created by the contract of acquisition must be respected for taxation purposes.
Editorial note: a donation contract in Québec is considered a unilateral contract by which property is transferred "by gratuitous title."