http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/98317/index.do 
Belcourt Properties Inc. v. The Queen (June 27, 2014 – 2014 TCC 316) was a decision on costs where the appellant had been successful in arguing that the sale of two properties gave rise to capital gains, not income. The main point on this hearing was the amount of tax at issue for the purposes of determining the applicable Tariff amounts. The taxpayer argued that the amount at issue exceeded $150,000, thus making it a Class C proceeding:
[5] The appellant summarized its approach as to the amounts in issue as follows in paragraphs 6, 7, 8 and 9 of its submissions:
6. In addition to the amount of tax owed ($46,810) with respect to the Appellant’s taxation year ended on December 31, 2005 as a direct result of the Notice of reassessment dated August 26, 2011 (Appellant’s Book of Documents, Exhibit A-1, Tab 20), the Appellant was also the subject of a proposed assessment pursuant to a letter dated September 29, 2011, advising the Appellant that following the said assessment an amount of $420,952.50 would be assessed against it pursuant to Part III of the Income Tax Act, as appears from Document 1 attached herewith under Annex B;
…
The Crown argued that it was a Class A proceeding since the amount of tax ($46,810) was less than $50,000.
The court held that this was a Class A proceeding since the Minister’s proposed assessment of 2008 under Part III of $420,952.50 (tax on an excessive capital dividend) was just a proposed assessment and had not been before the court even though the result of the decision eliminated that proposed assessment:
[29] Here, the Part III tax was the object of a proposed assessment only, and even though it had been the object of a determination by the Minister, it was not at issue in the appeal before me, which appeal was filed pursuant to subsection 169 of the ITA against the assessment issued for the 2005 taxation year. There was no appeal pursuant to section 185 of the ITA in relation to Part III tax, as Part III tax was never assessed.
[30] I therefore conclude that the aggregate of all amounts in issue before me was $46,810 and that this appeal was a Class A proceeding.
The second issue was a settlement offer made to the Crown shortly before trial:
[32] The appellant’s offer to the respondent that the appeal be allowed without costs was made less than two weeks before the hearing. This was not accepted by the respondent.
[33] The appellant relied on this offer to argue that a departure from the applicable tariff is justified in accordance with subsection 147(3) of the Rules. In the appellant’s view, given the unreliability of the auditor’s work and conclusions, the respondent should have determined that her position in the appeal was weak and should have given consideration to the appellant’s offer of settlement and conceded the case, rather than forcing the appellant to incur the costs of litigation and going to trial (Appellant’s Submissions for Costs, par. 43). In the appellant’s view, the issue to be decided in the appeal “concerned a ‘yes-no’ issue” with regard to which no element of compromise was possible (Appellant’s Submissions for Costs, par. 46). The appellant said that it could only make a settlement offer wherein the entire amount under dispute was treated as capital gains rather than as business income (referring to CIBC World Markets Inc. v. The Queen, 2012 FCA 3).
The court did not accept the appellant’s submissions:
[40] I do not agree with the appellant that there was no possible element of compromise and that the only option was for the appellant, which really wanted to settle the case before the hearing, to offer the respondent a settlement whereby she would consent to judgment for the full amount sought, without costs. There were two properties at issue and the circumstances surrounding the acquisition and the sale of those properties differed.
[41] Finally, as argued by the respondent, the so-called offer of settlement was not made well before trial, but was presented very close to the trial. I agree with the respondent that this element (the timing of the offer) does not call for a departure from the party and party costs to which the appellant is entitled under the Tariff (subsection 147(3.3) of the Rules).
[42] Having reviewed the factors enumerated in subsection 147(3) of the Rules, I am of the view that the appellant has not demonstrated that the Crown’s position did not have a reasonable degree of tenability. I find that there were no unusual circumstances that would justify my assessing an increased award of costs against the respondent.
Accordingly, the court made a modest award of costs under Class A:
[43] I therefore conclude that the costs awarded to the appellant shall be taxed by the taxing officer in accordance with the Tariff on the basis that the appeal was a Class A proceeding, subject to supporting documentation being provided.
[44] In doing so, I direct the taxing officer to accept, among the fees in the appellant’s bill of costs that are contested by the respondent, the fee for second counsel during the hearing, in accordance with paragraph 1(1)(h) of Tariff B, and all supported photocopy fees.
[45] The appellant shall also be awarded fees for services after judgment in accordance with paragraph 1(1)(i) of Tariff B.
[46] The appellant shall be reimbursed the excess amount paid in filing its appeal as a Class C proceeding rather than a Class A proceeding.