Maréchaux v. Queen - Supreme Court declines to hear case and CRA wins leveraged donation scheme

June 22, 2011 | By: .(JavaScript must be enabled to view this email address) Mark Blumberg
Topics: News, What's New from the Charities Directorate of CRA, Canadian Charity Law, Ethics and Canadian Charities, Avoiding 'Charity' Scams

F. Max E. Maréchaux, is a partner at the law firm of Miller Thomson LLP.  According to Federal Court of Appeal decision “F. Max E. Maréchaux participated in a “leveraged donation” scheme. The essence of the scheme was that, for an expenditure of $30,000, he received a charitable donation tax receipt for $100,000, and claimed a tax credit of $44,218, a potential return on his outlay of nearly 50% in a matter of months. Very little of the money was retained by charities to advance their purposes.”  Mr. Maréchaux had lost a decision at the Tax Court of Canada and his appeal to the Federal Court of Appeal was dismissed as “Mr Maréchaux had not made a “gift””.  Now the Supreme Court of Canada has denied Mr. Maréchaux’s leave to appeal which results in the Federal Court of Appeal decision standing.  According to the Trial Court “The Program was implemented on December 31, 2001, with 118 participants (“Participants”) and donations totalling approximately $18,305,000.”

http://scc.lexum.org/en/news_release/2011/11-06-09.3/11-06-09.3.pdf

DISMISSED WITH COSTS / REJETÉES AVEC DÉPENS
****
F. Max E. Maréchaux v. Her Majesty the Queen (F.C.) (Civil) (By Leave)
(34073)
(The motion for an extension of time to serve and file the application for leave to appeal is granted. The application for leave to appeal is dismissed with costs. / La requête en prorogation du délai de signification et de dépôt de la demande d’autorisation d’appel est accordée. La demande d’autorisation d’appel est rejetée avec dépens.)
Coram: LeBel / Fish / Cromwell


Here is a link to the Supreme Court page:
http://www.scc-csc.gc.ca/case-dossier/cms-sgd/dock-regi-eng.aspx?cas=34073


Here are some earlier pieces on the Maréchaux case:


Maréchaux v. Queen - victory for CRA at Federal Court of Appeal in “leveraged donation” scheme
http://www.canadiancharitylaw.ca/index.php/blog/comments/marechaux_v._queen_-_victory_for_cra_at_federal_court_of_appeal_in_leverage/

Maréchaux, F.M.E. v. The Queen (TCC) - leveraged donation scheme nixed by Tax Court of Canada
http://www.canadiancharitylaw.ca/index.php/blog/comments/marechaux_f.m.e._v._the_queen_tcc_-_leveraged_donation_scheme_nixed_by_tax_/

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Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.

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