http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/67307/index.do 
Michaud v. The Queen (March 17, 2014 – 2014 TCC 83) involved claims for losses from a prospecting business. The Minister took the position that the activities were personal in nature and not a business; alternatively the Minister sought to disallow a large portion of the losses as personal expenses:
[1] The Appellant claimed business losses of $13,525 and $22,931 in respect of his 2007 and 2008 taxation years. According to the Appellant these losses were incurred in respect of mining activities which constituted a business.
[2] The Minister of National Revenue (the “Minister”) disallowed the losses on the grounds that the Appellant’s mining activities had a strong personal element and were not conducted in a sufficiently commercial manner to constitute a business. In the alternative, the Respondent argues that if the mining activities do constitute a business, the Appellant’s losses should be limited to $8,426 for the 2007 taxation year and $14,068 for the 2008 taxation year on the ground that the expenses claimed in excess of those amounts were not incurred for the purpose of earning income.
The court was satisfied from the appellant’s evidence that his prospecting activities were commercial in nature but accepted the Minister’s alternative position that many of the expenses were personal:
[13] My review of the evidence has satisfied me that the Appellant was engaged in gold prospecting in a commercial manner in 2007 and 2008. The Appellant’s testimony reveals that he has acquired significant knowledge in the fields of precious metal prospecting and mine development.
[14] Much of this knowledge appears to have been acquired from the Appellant’s interaction with personnel of the Kemess mine. The Appellant has a well-defined business plan which has put him on the cusp of undertaking gold production on one of his claims. The Appellant has invested significant effort and capital in his mining activities. I also take comfort from the fact that the CRA auditor acknowledged that she failed to consider whether the Appellant was engaged in gold prospecting in a commercial manner. Her conclusion that he was not carrying on a business activity appears to have been motivated by the fact that the Appellant’s mining activities had not matured to the point of actual gold production on a commercial scale. Prospecting is a first step that precedes investment in the commencement of mining operations. Ore must be found in sufficient quantities before capital will be committed to mine development and to production. More often than not, prospecting activities are not successful. A great deal of time may pass between the prospecting, mine development and actual production stages. In the case of the Appellant, the presence of his children on his field trips did not interfere with his gold prospecting activities, which have led to the discovery of commercially viable deposits on one of his claims.
[15] I must now consider the Respondent’s alternative argument. The CRA auditor conducted a detailed and thorough analysis of the expenses claimed by the Appellant with respect to his mining activities. For 2007, the CRA auditor disallowed expenses of $5,099 on the basis that they were personal in nature and did not relate to the Appellant’s mining activities. For 2008, the auditor disallowed expenses of $8,863 for the same reason. I can find no error in the CRA auditor’s analysis. More importantly, the Appellant has failed to convince me that the disallowed expenses were not personal in nature. Therefore, I accept the Respondent’s alternative argument and conclude that the Appellant’s business losses from his mining activities were $8,426 for the 2007 taxation year and $14,068 for the 2008 taxation year.