The rectification saga continues. From Timothy Fitzsimmons’ summary of Fairmont Hotels Inc. et al v AG (Canada), 2014 ONSC 7302:
Fairmont relied on the Ontario Court of Appeal decision in Juliar for the principle that the exact method to achieve a common intention to avoid tax is not required at the time of the transaction. In response, the Crown argued that the Alberta Court of Queens’ Bench in Graymar Equipment (2008) Inc. v AG (Canada), 2014 ABQB 154, had been critical of Juliar and had stated that rectification is granted to restore a transaction to its original purpose and not to avoid an unintended effect.
However, in the present case, the Ontario Superior Court of Justice stated that, unlike the Alberta court, Ontario courts “do not have the luxury of ignoring” the Ontario Court of Appeal’s decision in Juliar. Further, the Ontario court stated that the Alberta court had not accurately described what happened in Juliar, and that another recent Alberta decision had in fact followed the reasoning in Juliar.
