Consider each of the following unrelated cases, involving the ownership of shares of Canadian-controlled private corporations. Assume all of the issued shares are common shares unless specifically stated otherwise.
(A) Rachel and Monica, friends, each own 50% of the issued shares of A Ltd. In addition, Rachel owns 80% and Monica owns 20% of the issued shares of B Ltd.
(B) Charlie and Claudia are siblings. Charlie owns 80% of A Ltd. which in turn owns 40% of B Ltd. Claudia owns 60% of B Ltd.
(C) Bob, Bill, and Bert are three brothers who share equally the income of a professional partner-ship. The partnership owns 100% of the shares of A Ltd. Bert owns 100% of the shares of B Ltd.
(D) Anne and Barbara are sisters. They each own 100% of their respective corporations, A Ltd. and B Ltd. A Ltd. and B Ltd. each own 40% of the shares of C Ltd.
(E) Valerie, Brandon, and Claire are strangers. They each own ‘A of the shares of A Ltd. Brandon owns 40% of the shares of B Ltd. The remaining 60% are owned by Claire. Claire also owns 100% of the shares of C Ltd.
(F) Valerie and her two nieces each own 25% of the shares of A Ltd. Valerie’s husband, Dilon, and his nephew each own 50% of the shares of B Ltd. Dilon also owns the remaining 25% of the shares of A Ltd.
(G) Father owns 100% of the shares of F Ltd. His son, Sean, age 17, owns 100% of the common shares of S Ltd. F Ltd. owns 30% of the issued preferred shares of S Ltd. The preferred shares have the following characteristics:
• Non-voting,
• Dividend rate fixed at 6%,
• Redeemable at $1,000 per share, and
• Issue price $1,000 per share.
The prescribed rate of interest was 8% at the time the preferred shares were issued.
REQUIRED
Determine which of the corporations are associated and substantiate your answer by reference to specific provisions of the Act.