Caithkin, Inc. v. Canada (May 5, 2015 – 2015 FCA 118, Gauthier, Webb, Rennie (author) JJA).
Précis: This is an appeal by the taxpayer of a Tax Court decision blogged earlier on this site. The appellant was a for-profit corporation that, under contract with various Children’s Aid Societies in Ontario (“CAS”), provided foster parents for children in the care of CAS. The appellant trained and recruited foster parents and then placed the children in the homes of the foster parents. It was paid by CAS for its services and in turn paid amounts to the foster parents for the children’s care. The sole question on this appeal was whether its services were subject to GST. The appellant relied on provisions of the Excise Tax Act
which rendered such services “exempt supplies” when they were made in an “establishment” operated by the supplier. The Tax Court held that the homes of the foster parents were not “establishments” operated by the taxpayer. The Federal Court of Appeal agreed with the Tax Court; the “bundle of services” provided by the taxpayer did not constitute an “establishment” in which the children were cared for. The appeal was dismissed, with costs.
Decision: This decision turned on the construction of the word “establishment” used in two GST exempt supply provisions:
 Section 2 of Schedule V, Part IV includes as an exempt supply:
2. A supply of a service of providing care, supervision and a place of residence to children, underprivileged individuals or individuals with a disability in an establishment operated by the supplier for the purpose of providing such service.
2. La fourniture de services qui consistent à assurer la garde et la surveillance d’enfants ou de personnes handicapées ou défavorisées, et à leur offrir un lieu de résidence, dans un établissement exploité à cette fin par le fournisseur.
 Section 3 also provides:
3. A supply of a service of providing care and supervision to an individual with limited physical or mental capacity for self-supervision and self-care due to an infirmity or disability, if the service is rendered principally at an establishment of the supplier.
3. La fourniture d’un service de soins et de surveillance d’une personne dont l’aptitude physique ou mentale sur le plan de l’autonomie et de l’autocontrôle est limitée en raison d’une infirmité ou d’une invalidité, si le service est rendu principalement dans un établissement du fournisseur.
The taxpayer provided services to children in the care of CAS. It did not however provide those services in homes owned or maintained by it. Rather it hired a network of foster parents who provided the care from their own homes. The Tax Court found that the services were not exempt since they were not provided from an “establishment” maintained by the taxpayer. The Court of Appeal agreed:
 The word “establishment” cannot be extracted from the statute and read in isolation. To do so would offend the direction given by the Supreme Court that statutes must be read as a whole. In this case, the provision is triggered only where the services are supplied “in an establishment operated by the supplier.” In other words, the services must be rendered both “in” an establishment, and in one that is “operated by” the supplier. The meaning of the word “establishment” is informed by these words.
 Given its ordinary meaning, the word “in”, which informs the word “establishment”, denotes a physical place, and not a figurative construct, as contended by the appellant. A bundle of services is not a physical place. One cannot provide care, supervision and a place of residence in a bundle of services. Further, the French version of the provision utilizes the word “dans”, reinforcing the plain and ordinary meaning of the word “establishment” to be a home or physical residence. The appellant’s argument that the “establishment” may be a bundle of services does not sit with the plain and ordinary meaning of the word.
As a result the appeal was dismissed, with costs.