http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/72957/index.do 
Belcourt Properties Inc. v. The Queen (May 27, 2014 – 2014 TCC 208 ) was a case dealing with whether two properties sold by the appellant gave rise to gains on income or capital account:
[1] In the present appeal, the issues in dispute are whether the Minister of National Revenue (Minister) erred in recharacterizing as business income the gain (declared by the appellant as a capital gain) realized by the appellant in its 2005 taxation year from the disposition of two properties, one located at 5253 Park Avenue, Montreal (acquired in June 2002) and the other located at 5655-5685 Côte‑des‑Neiges (corner Côte‑Sainte‑Catherine), Montreal (acquired in December 2000), and in reassessing on that basis. The tax treatment of the proceeds of those dispositions as declared by the appellant and as recharacterized is shown as it appears from the proposed adjustments of the Canada Revenue Agency (CRA) set out in Schedule 1 to the document dated July 14, 2009, filed as Exhibit A-1, Tab 12 (Appellant’s Written Arguments and Authorities, page 4).
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[2] The appellant submits that its intention in acquiring those properties was to hold them as investments in order to produce rental income, hence the capital gain declared following the disposition, 50 per cent of the profit being taxable in accordance with sections 38 and 39 of the Income Tax Act (ITA). The respondent is of the view that the sale of the two properties took place in the ordinary course of the appellant’s business (or at least was an adventure or concern in the nature of trade) and therefore 100 per cent of the profit had to be included in the appellant’s business income pursuant to sections 3 and 9 of the ITA.
The court accepted the appellant’s evidence that the although it had always intended to sell the condominium portion of the two properties for a profit, the intention was to retain the commercial rental properties as investments:
[43] With respect to the fact raised by the respondent that S.O.S Properties reported the proceeds of the sale as business income, Mr. Osher explained that he did not have any training in accounting and that he did not know how his accountant treated the profit (Transcript, page 125). I am satisfied that this does not necessarily have any impact on Mr. Osher’s credibility with respect to his testimony on his intent at the time of the investment (Mr. Osher corroborated Mr. Zunenshine’s testimony that the purpose of the joint venture was to sell the residential condominiums and to keep the commercial space on the ground floor as a revenue property (Transcript, page 40 and page 109). Rather, it is my understanding that Mr. Osher, because of his lack of knowledge, did not discuss with his accountant how the profit on the sale should be reported in S.O.S.’s tax return for the 2005 taxation year.
[44] Considering that the Minister did not clearly contemplate the secondary intention of reselling at a profit as a determinative factor which motivated the appellant to purchase the properties at issue and that therefore the burden to prove the contrary does not fall on the appellant, I am satisfied with the explanation given by Mr. Osher and Mr. Zunenshine that they accepted unsolicited offers for reasons beyond their control that they could not foresee at the time the properties were purchased.
The appeal was accordingly allowed, with costs.
Comment: The Crown’s failure to plead “secondary intention” as an assumption of fact (although it was pleaded as a fact) may well have been the critical factor in turning the decision in favour of the appellant.