At the Court: Moldowan Revisited and Learning Disability Human Rights Claim Considered at the SCC

Between a Hoof and a Hard Place

John Craig is a Toronto lawyer with a successful practice in securities, M&A, and mining law. In his spare time, he breeds and raises horses.

Although his income is largely derived from his position as a partner at Cassels Brock, his horse breeding activities have been defined as “farming” for the purposes of s.31(1) of the Income Tax Act, which covers losses from farming where the main source of income is not from farming. This dispute arose when the Minister of National Revenue restricted the deductions that Mr. Craig could claim in 2000 and 2001 to $8,750.

At issue is whether an appellate level court must follow a previous decision of its own that is inconsistent with a judgment of the Supreme Court. In 2006, the Federal Court of Appeal decided in Gunn v Canada, 2006 FCA 281 that one’s main source of income could be a combination of income from farming and other sources, regardless of whether the income derived from the farm was less than income gained elsewhere. Under Gunn, Mr. Craig can make full deductions. However, the Supreme Court had decided in 1978 in Moldowan v Canada, [1978] 1 SCR 480 that if a taxpayer does not reasonably expect to profit off of hobbies, he cannot claim deductions for expenses.

The Attorney General argues that, because Gunn is inconsistent with the Supreme Court’s decision in Moldowan, the Federal Court of Appeal should not have followed its own judgment, and that it was in error when it decided for Mr. Craig. Mr. Craig asserts that the Federal Court reconciled the conflicting decisions in line with relevant caselaw.

The hearing is scheduled for March 23.


Grading the Schools

According to Statistics Canada, one student on every school bus has a learning disability (approximately 3.2% of Canadian children). This accounts for one of the fastest-growing disability groups unrelated to aging. Between 2001 and 2006 the percentage of Canadians above the age of 15 with learning disabilities increased by nearly 40%.

The Supreme Court of Canada will have the opportunity to reflect on these shocking statistics as it hears Frederick Moore on behalf of Jeffrey P. Moore v Her Majesty the Queen in Right of the Province of British Columbia as represented by the Ministry of Education, et al 2012 on March 22.

Finding that the B.C. Ministry of Education discriminated against his son, Jeffrey Moore, Rick Moore filed a complaint with the B.C. Human Rights Tribunal in 1997. He claims that the North Vancouver School Board violated s.8 of the B.C. Human Rights Code by failing to accommodate Jeffrey’s disability in the third grade. Jeffrey was diagnosed with dyslexia, which is categorized as a severe learning disability. The school board had recently closed a program that provided intensive remediation to students with learning disabilities. Consequently, Jeffrey struggled.

The complaint with the B.C. Human Rights Tribunal held in Mr. Moore’s favour. Having found that Jeffrey received equal or better service to those accorded to other learning-disabled children, the ruling was overturned upon appeal by the B.C. Supreme Court, which was also upheld by the Court of Appeal, 2-1. Justice Rowles’ dissenting opinion provided the hope and a gateway for this decision to be heard by the Supreme Court of Canada.

Mr. Moore submits that BC’s education system failed in its obligation to be inclusive of all children, which is contrary to s.8 of the B.C. Human Rights Code (the “Code”), which states:

8 (1) A person must not, without a bona fide and reasonable justification, …

(b) discriminate against a person or class of persons regarding any accommodation, service or facility customarily available to the public because of… physical or mental disability…

The Crown argues that the Code guarantees an equality of learning opportunities. Jeffrey Moore was provided with adequate educational support tailored to his individual needs, which led to an equality of learning outcomes. The fact that he did not learn to read by a particular grade level is not sufficient proof of discrimination.

Jeffrey was enrolled in a costly private school with specialized programs to assist him. He is now a graduate of both high school and post-secondary education, and works as a plumber.
With a growing number of Canadians being diagnosed with learning disabilities, it is imperative that they be mindful of our standards and policies of education. The Court must decide whether the provisions in place for students with disabilities are sufficient. Students must have access to equitable educational opportunities that are reasonably equivalent to those of other students. Does our system make the grade?

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