"(3) New Argument
" On August 29, 2014, almost three and a half months after the hearing of this appeal, the Appellant brought a motion for leave to amend its Notice of Appeal in order to put forward a new argument (the “New Argument”), namely that Mr. Rogers mistakenly treated the Surrender Payment as a capital gain. According to the Appellant, this New Argument merits my consideration because it is based on the outcome in Mathieu c. La Reine, a recent decision of this Court released on June 27, 2014.
" While subsection 7(3) of the Act deems there to be no benefit when options are disposed of, this deeming provision applies only for the purposes of section 6 of the Act. It is important to note that a capital gain is not defined in the Act as a gain arising or resulting from the disposition of capital property. Instead, subsection 39(1) defines a capital gain broadly as “the taxpayer’s gain . . . from the disposition of any property” other than property specifically excluded under that provision (“Excluded Property”).Recognizing the potential for overlap with other sections of the Act, the legislator chose to specifically exclude gains that are otherwise included in income under section 3.
" In the case at bar, Mr. Rogers realized a gain from the disposition of the Options. The Options are property. They are not Excluded Property. Because of subsection 7(3) of the Act, no part of the gain was otherwise included in income under section 3. Therefore, the gain is a capital gain for the purpose of section 39. Consequently, Mr. Rogers was correct in considering that he realized a capital gain corresponding to the amount of the Surrender Payment received as proceeds of disposition for his Options.
See Rogers Estate v. The Queen, 2014 TCC (Hogan)