Zheng v. The Queen (July 13, 2017 – 2017 TCC 132, Russell J.).
Précis: This is one of the few cases where the Tax Court has accepted that a named purchaser was a true “accommodation party” for the real purchaser and, as a result, allowed the New Housing Rebate where the real purchaser (in this case her former brother-in-law), or a member of his or her family, took possession of the property on closing. As a result the appeal was allowed, without costs (this was an informal procedure appeal).
Decision: The facts were not overly complex but quite persuasive:
 The following summarizes their evidence. In the spring of 2011 the Appellant, Qun Y. Zheng (“Qun”), of Richmond Hill, Ontario was asked by her older sister Ms. Yu-Lian Zheng (“Yu-Lian”) and that sister’s ex-husband Kwong Wing Cheung (“Kwong”), both of the Vancouver area, to search for a house in the Toronto area that they could buy for their daughter Lucy Cheung (“Lucy”), also resident in the Vancouver area. Lucy had enrolled in a degree course at University of Toronto (“UofT”) beginning in the fall of 2012 and therefore would have to live in the Toronto area to attend that course. Qun was these Vancouverites’ only Toronto area relative, and so they had turned to her for help with this.
 Qun, aided by real estate agent Millie, made a search of available real estate, resulting in identification of a prospectively appropriate property in nearby Markham. The property was a planned house, with construction completion anticipated for late October, 2012. This property was close to Qun’s own house and sufficiently sized for Lucy’s parents to stay there when visiting. The purchase price was $509,900. Price was a factor in not buying closer to the UofT downtown campus. Qun informed her sister and sister’s ex-husband of this property, recommending same for their purchase for Lucy’s use.
 On July 26, 2011, at the request of Yu-Lian and Kwong, Qun initiated purchase of this Markham property, by signing a purchase/sale agreement with the developer to buy this property which would include the to-be-constructed house (Exhibit A-1, purchase/sale agreement, July 26, 2011). While it was intended that Qun’s ex-brother-in-law, Kwong, would be the purchaser on title, at this particular time he happened to be in China and his full name with photo identification, needed before his name could appear in the purchase/sale agreement as a purchaser, apparently was temporarily unattainable. The $40,000 deposit for the purchase/sale agreement was funded to Qun from a bank account Yu-Lian and Kwong had established for this purpose (Exhibit A-2, Downpayment funds).
 Two weeks later Kwong was available and promptly had his name added as a purchaser to the purchase/sale agreement (Exhibit A-3, Amendment to Agreement of Purchase/Sale, dated August 9, 2011). The vendor/developer’s policy was to not permit removal of names of purchasers from a purchase/sale agreement. This prevented Qun’s name as purchaser from then being amended off the purchase/sale agreement, at the same time Kwong’s name was added by amendment.
 Thereafter, Kwong entered into a mortgage with Bank of Montreal on the Markham property, with ex-wife Yu-Lian signing as guarantor. Qun had no participation whatsoever in the mortgage (Exhibit A-2, Charge/Mortgage), nor in any financing relating to the Markham property.
 After delays in construction completion, the Markham property purchase/sale transaction closed on December 20, 2012. Title to the property was taken solely in Kwong’s name. Qun was not named on title (Exhibit A-6, Direction re Title). Older sister Yu-Lian, did not seek to be on title. The reason Kwong gave for this was that, his “job was safer than hers”.
 Meanwhile, in September 2012 Lucy had started attending UofT and was living with her aunt, Qun, pending delayed completion of construction of the Markham property. Upon construction completion and occurrence of the consequently delayed closing on December 20, 2012, Lucy commenced living in the Markham property that her father, Kwong, now owned, being a good-sized house.
The Court held that Ms. Zheng (“Qun”) was a true agent for her former brother-in-law:
 I consider that the description and tests for implied agency referred to above have been fully met in the case at bar. The uncontroverted evidence is that the Appellant, Qun, was acting on the directions of and for the benefit of her former brother-in-law and his ex-wife, being the Appellant’s older sister, in being able to arrange suitable accommodation in Toronto for those two ex-spouses’ university student daughter. The Appellant was given authority by former brother-in–law Kwong and sister Yu-Lian, to enter into the purchase and sale agreement for the Markham property on their joint behalf. Testimony of Qun, Kwong, Yu-Lian and Millie all demonstrated and confirmed this. In respect of Fourney, control of Qun was “manifested in the authority” Kwong and Yu-Lian gave her in buying and eventually selling the Markham property for them.
 The Respondent’s position was simply that the Power of Attorney was signed too late (i.e., it was signed four days after the December 20, 2012 closing). This indicates an undue focus simply on when an explicit, written document came into existence. That position overlooks the concept of implied agency. And in any event the terms of the Continuing Power of Attorney, focused on “sale and management”, would not, strictly speaking, apply to the purchase of the Markham property.
 An implied agency simply reflects existence of an agency relationship in the absence of formal or explicit documentation identifying that agency relationship. As well, whether an agency relationship exists is generally determined on the actual facts of the situation, not upon whether the relationship has been formalized in writing. The existence of a written agency agreement is usually just further evidence supporting existence of an agency relationship; it is not generally determinative as to the actual existence of an agency relationship. That is, an agency agreement could exist on paper but if the conduct of the parties were not reflective of an agency relationship then likely it would be concluded as a matter of fact and law that there was no agency relationship. Actual conduct rather than existence of formal agency agreement normally governs. In this regard I disagree with the Respondent’s submission that finding an agency relationship here constitutes a re-characterization of the actual circumstances. In my view it is a correct characterization of the attendant circumstances.
 As well, I note that I am not attempting to confer equitable relief; rather, I am identifying the actual legal situation that here pertains, for the purpose of deciding whether to dismiss or allow this appeal as to the correctness or otherwise of the subject February 19, 2014 GST assessment.
As a result the appeal was allowed, without costs (this was an informal procedure appeal).