Duyo v. The Queen (April 24, 2018 – 2018 TCC 79, Hogan J.).
Précis: This was a classic case of an accommodation party agreeing to facilitate the purchase of a house without intending to reside in it with the actual purchasers. The case was held in abeyance pending the decision of the Federal Court of Appeal in Cheema which was blogged earlier on this site. Since a majority in Cheema denied the New Housing Rebate in such a circumstance the Tax Court’s hands were tied and the appeal was dismissed. There was no order as to costs since this was an informal procedure appeal.
Decision: In this case the accommodation party was a Ms. Shabut:
 The sole issue in this appeal is whether the appellant is entitled to the NHR pursuant to subsection 254(2) of the Act. The resolution of this issue, in turn, depends on whether Ms. Yabut took title as bare trustee for the appellant and his spouse as beneficial owners of the Property, and whether this was effective in exempting Ms. Yabut from inclusion in the category of “particular individual” within the meaning of subsection 254(2).
The Tax Court held that it was bound by the majority decision in Cheema:
 As a final comment, I observe that the appellant in this case relied on essentially identical arguments to those made by the taxpayer in the Cheema appeal. In this regard, the appellant emphasized that, after signing the agreement of purchase and sale and two days prior to possession being taken of the property, he, his spouse, and Ms. Yabut, on November 11, 2014, entered into an acknowledgement of trust agreement, which stated that beneficial ownership of the Property was limited to the appellant and his spouse. The evidence shows that this information was provided to neither the lender nor the builder. Furthermore, the GST rebate application form filed with the CRA listed the appellant, his spouse, and Ms. Yabut as the owners of the Property.
 In Cheema, the FCA dealt with this same issue. The majority stated that paragraph 254(2)(b) is drafted in a way that makes these types of facts irrelevant when determining whether a particular individual is entitled to a rebate: “It is the relationship of the person acquiring the complex to the builder – one of purchase and sale – that is relevant, not the relationship between co-purchasers.”
As a result the appeal was dismissed. There was no order as to costs since this was an informal procedure appeal.