In Philip Friedlan and Adam Friedlan “Brown v. Canada: REOP Redux?” Tax for the Owner-Manager 23:2 (April 2023), the authors argue that Brown v R, 2022 FCA 200, appears to have confirmed that R v Paletta, 2022 FCA 86, introduced a new kind of “reasonable expectation of profit” (REOP) test. Stewart v R, 2022 SCC 46, was supposed to have liquidated the REOP test, but Brown and Paletta seem to require taxpayers to show that an activity was undertaken in pursuit of profit even if it has no personal or hobby element.
