Principles of Taxation - Ch 8 - Income from Business PDF

Preview

Summary

Questions and solutions from Principles of Taxation 2014/15....

Description

Principles of Taxation Q&A – Income from Business Pr i nci pl esofTaxat i onLaw –2015 Answer st oQuest i ons CHAPTER8–I NCOMEFROM BUSI NESS Quest i on8. 1 Af t erent er i ngi nt oamanagementagr eementt woy ear sagof ort hepur poseofst ar t i ngabusi nessi ncat t l e br eedi ngnexty ear ,Geor gi napai d$5, 250byc hequet oACM,whos ebus i nes swast r ans f er r i ngembr y osf r om s t udcowst oor di nar ybr eedi ngc ows .Undert heagr eements hewasguar ant eeds i xc al v esi nt henex tt wo y ear s .

I ft hev ent ur ef ai l ed,ACM r emai nedl i abl et os uppl yt hec al v esf r om anot hers our ce.Hav i ngpai dherf eesf or Year2,s hedi dnotr ec ei v eanys ubs equentnot i fi c at i ont hatt hei mpl ant si nherr eci pi entcowswer es uc ces s f ul . Shedi dnotf ol l ow upaf t ert hei mpl ant at i onnot i c est ofi ndoutwhet heranyofherc owswer epr egnant .Nordi d s he enqui r e whet herherc owshad been i mpl ant ed a s econd t i me asc ont empl at ed byt he t er msoft he ManagementAgr eement ,whi c hpr ov i dedt hateac hr ec i pi entc ow woul dbei mpl ant edoncei neac hoft he12mont h cont r act ualper i ods .She s ai dt hats he had s pok en t o herac c ount antwho t ol d hert hi ngs wer e pr ogr es s i ng,buts l owert hanant i c i pat ed.

Af t erpay i ngherYe ar2Feesi nJ une,Geor gi nahear dnot hi ngspec i fi cf r om ACM e x c eptbywayofnewsl et t er s c ont ai ni nggener ali nf or mat i on.Shemadenoat t emptt oc ont ac tACM i nt hec ur r enty earaboute x t endi ngt he l eas eonherr eci pi entc ows .Shes ai ds hewasgoi ngt hr oughav er ydi f fi c ul tt i me.Her12mont hol dc hi l dhad c ont r ac t edas er i ousi l l nes sands hehadt of oc usonl ook i ngaf t erhi m.

I sGeor gi nacar r y i ngonbus i nes s ? Answer T odet er mi newhet herGeor gi nai si nbus i nes soronl yc onduc t i ngact i v i t i est hatar epr el i mi nar yt oabus i nes s , i ti sneces sar yt oappl yt hei ndi c i aofabus i nes susedbyt hecour t s .I nFer gus onvFCT( 1979)9ATR 873,t he mai nc r i t er i aus edwer et hat :  apur pos eofpr ofit mak i ngmaybei mpor t antbutnotes s ent i al ;  r epet i t i onandr egul ar i t yar econs i der at i ons ,butabus i nes sc oul di nv ol v eas i ngl et r ans ac t i onandev er y bus i nes smus tc ommencewi t has i ngl et r ans act i on;  or gani s at i on and a bus i nes s l i k e appr oac h wi t h appr opr i at er ec or dk eepi ng et c ar ei ndi c at i ons ofa bus i nes sact i v i t y ;  hav i ngot hers our c esofi nc omedi dnotpr ec l udet hi sac t i v i t yf r om bei ngabus i nes s ;  t hes i z eoft heoper at i onandt heamountofcapi t al ar er el ev ant ,butmus tbel ook edati nt hec ont ex toft he t y peofact i v i t y ,egar ecr eat i onalpur sui tmayhav ec ons i der abl eeffor tandr es our cescont r i but edt oi tand notbeabus i nes s . Thef ac tt hatGeor gi nac onduc t st heact i v i t yt hr oughanagentwi l lnoti ni t s el fs how t hats hei snoti nbus i nes s ast hec our twi l l c ons i deranumberoff ac t or sandwei ght hes eupt of or m ac onc l us i on. Thef ac t sgi v enf orGeor gi nadonothav es omeoft hek eyel ement st hatwer epr es enti nFer gus onvFCT.For ex ampl e,t her ei snoc l eari ndi c at i onofal ongert er m pl ant odev el opt heher d,t her ei snor ealper s onal i nv ol v ementi nt hepl anni ngandoper at i onoft hebr eedi ngpr ogr am,t hesi z eoft het r ans ac t i onwasr at her s mal landt her ei snocapi t al i nv ol v ed. Ont heot herhand,abus i nes smaye x i s tev ent houghi ti ss mal l( ThomasvFCT)orconduc t edi neffic i ent l y .I f Geor gi nacoul ds how t hatt hi sbr eedi ngpr ogr am i spar tofapl ant obui l dal ar gerher dofs t udc at t l eandt hat

1

Principles of Taxation Q&A – Income from Business s hewasunder t ak i ngt hi si nabus i nes sl i k emanner ,t her ewoul dbear eas onabl ec as et oar guet hats hei si n bus i nes s .Howev er ,ont hef ac t spr es ent ed,i twoul dbedi ffic ul tt oj us t i f yt hatherac t i v i t i esar eabus i nes s .

2

Principles of Taxation Q&A – Income from Business Quest i on8. 2 Ax i sHol di ngsLt dwasf oundedi n1976byLucasandTai t ,whower et hei ni t i als har ehol der sanddi r ect or s . Luc asandT ai thadf ormanyy ear sbeeni nv ol v edi npr oper t ydev el opment .Teny ear sagoAx i spur c has edt wo pr oper t i esi nanar eawher et her ewasex t ens i v er eales t at edev el opment .Fors i xy ear st hepr oper t i eswer e us edf orcat t l ebr eedi ngandt hepr oper t i eswer ei mpr ov edf ort hatpur pos e.

Owi ngt ounf or es eenc i r c ums t ances ,t hecat t l ebr eedi ngpr ov edt obeunpr ofi t abl eandt her ewasani mmi nent z oni ngc hangewher ebyt hepr oper t i esc oul donl ybedi s pos edofi n100hec t ar el ot si ns t eadof25hec t ar el ot s . Ax i st her ef or ear r angedt os ubdi v i det hel andupi nt o25hec t ar ebl oc k sands ol dt hewhol epr oper t yt oone pur c has er .TheCommi s s i oneras s es s edAx i sont hegr os sr ecei pt si ns65ofI TAA1997.

Di s c us s . Answer Thefi r sti ss uer ai s edi nt heques t i oni swhet hert hes al ei sani s ol at edt r ans ac t i ont hati sor di nar yi nc ome f ol l owi ngt hedec i s i oni nFCTvWhi t f or dsBeac hPt yLt d( 1982) 12ATR692,orwhet heri ti samer er eal i s at i on ofac api t alas s et .Axi sHol di ngsi sc ar r yi ngonaf ar mi ngbus i nes sandwhet hert hi si sanex t r aor di nar yor i s ol at edt r ans act i on wi l ldepend onwhet hert he c ur r entbus i nessi ss t i l li noper at i on:s ee [ 8. 170] .Ast he pr oper t yi sdev el opedf orr es al ei tcoul dbear guedt hatt hebus i nes soff ar mi nghasc eas edandt hes al ei san i s ol at edt r ans act i on.Ont hi sbas i s ,t hepr i nc i pl esi nFCTvWhi t f or dscanbeappl i edt ohel pdet er mi newhet her t hi ss al ei sor di nar yi nc omeoramer er eal i s at i on.Fr om t hec as esf ol l owi ngWhi t f or dsBeac hi tappear st hat t hey ar e onl y gui del i nes and no s t r i ctr ul es on how a mer er eal i s at i on c an be s epar at ed f r om a s al e under t ak en i n a bus i nes s manner .Howev er ,t he bus i ness l i k e appr oac ht ot he di s pos ali s an i mpor t ant di s t i ngui s hi ng f ac t or .Thi si ss een i nc as es s uc h as Casi mat y v FCT ( 1997)37 ATR 358 wher et he dev el opmentwasnott ak ent ot hefi nals t ageofs el l i ngi ndi v i dualbl oc ks .I nt hi sc ase,Ax i sHol di ngshass ol d t hear eaasonepar c el ofl andandt hi sf actwoul dhel pt hear gumentt hati ti samer er eal i s at i on,asi nSc ot t i s h Aus t r al i anMi ni ngCoLt dvFCT( 1950)81CLR188. Thes ef ac t sal s oneedt obecons i der edi nr el at i ont ot hepos s i bl eappl i c at i onoft hefi r s ts t r andofFCTvMy er Empor i um Lt d( 1987)163CLR 199.Thefi r s ts t r andofMy erwi l lappl yi ft her ei sac ommer c i alt r ans ac t i on ent er edi nt owi t hani nt ent i ont opr ofi tandt hepr ofi tul t i mat el yr eal i s edar i s esf r om t hei ni t i ali nt ent i on.Fort he fi r s ts t r andofMy ert oappl y ,i twoul dbenec es s ar yt os how t hatt hepr oper t ywaspur c has edwi t ht hei nt ent i on t osel li tatapr ofi t .Thef ac t sgi v es omei ndi c at i onoft hi si nt ent i oni nt hatt hes har ehol der soft hec ompany hav e been i nv ol v ed i n pr oper t y dev el opmentand t he pur c has ei si n an ar ea ofex t ens i v er eales t at e dev el opment .Howev er ,t hecompanyappear st ohav ebeenes t abl i s hedt ooper at eaf ar mi ngbus i nes s .The ot herf ac t ort hatmaybeus edt oar gueagai ns tt heappl i c at i onofMy eri st hatt hepr oper t ywasnotdev el oped asmi ghtbee x pec t edf r om apr oper t ydev el oper ,butwass ol dr at herqui c k l ybec aus eofi mmi nentc hangest o z oni ng.Thedec i s i oni nWes t fi el dLt dvFCT( 1991)21ATR1398,wher ei twass hownt hatt hei nt ent i ont os el l t hepr oper t ymus tc l ear l yex i s tatt het i meoft hepur c has e,mayal s obeus edt os uppor tt hec as et hatt hi si sa mer er eal i s at i on. I tc oul dber eas onabl et oar guet hatt hi si sor di nar yi nc omef r om anex t r aor di nar yt r ans ac t i onpr ov i dedi ti s as s umedt hatt hedev el opmenti scont i nui ng,buti ft hes al ei snotor di nar yi nc omei tmaybes ubj ec tt oCGT. Quest i on8. 3 Pet eri saf ar merwi t h15hec t ar esofl andonwhi c hhehasgr ownor angess i nc e1960.Hei nher i t edt hel and f r om hi sf at heri nt haty ear .Thef ar m hasgr adual l ybeens ur r oundedbyur bandev el opmentand,t hr eey ear s ago,f ol l owi ngc ompl ai nt sf r om t henei ghbour saboutpes t i c i des ,hedec i dedt os el l t hel and.

T woy ear sagoPet erc ont r ac t edwi t hac ons ul t i ngengi neerands ur v ey orwhopr epar edas ubdi v i s i onpl anand

3

Principles of Taxation Q&A – Income from Business whoappl i edt ot hel oc alc ounc i lf orr ez oni ng.Pet erwasnotdi r ec t l yi nv ol v edi nt hepl anort her ez oni ng,whi c h wasgr ant edbyt hec ounci ll at ert haty ear .Near l yal le xpens eswer epai dbyPet er ,al t houghhehadt obor r ow $120, 000t oc ov ersomei nc i dent al e xpens es .

Fol l owi ngc ompl et i onoft hedev el opmentt hel andwentons al et hr oughar eales t at efi r m andt odat e150of t he200bl ock shav enowbeens ol df orr es i dent i al hous i ng.Bl oc k ss el l f oranav er ageof$150, 000eac h.

Advi s ePet erast ohi st axl i abi l i t y ,i fany . Answer Thei s s uer ai s edi nt heques t i oni swhet hert hes al ei sani sol at edt r ans ac t i ont hati sor di nar yi nc omef ol l owi ng t hedec i s i oni nFCT vWhi t f or dsBeac hPt yLt d( 1982) 12ATR 692,orwhet heri ti samer er eal i s at i onofa c api t alass et .Pet erhasbeenc ar r y i ngonaf ar mi ngbus i nes sandwhet hert hi si sanex t r aor di nar yori s ol at ed t r ans act i onwi l l dependonwhet hert hec ur r entbus i nes si ss t i l l i noper at i on:s ee[ 8. 170] .Thes ubdi v i s i onoft he l andandt hes al eoft hes epar at ebl ocki ndi c at et hatt hebus i nes soff ar mi nghasceas edandt hes al ei san i s ol at edt r ans act i on.Ont hi sbas i s ,t hepr i nc i pl esi nFCTvWhi t f or dscanbeappl i edt ohel pdet er mi newhet her t hi ss al ei sor di nar yi nc omeoramer er eal i s at i on.Fr om t hec as esf ol l owi ngWhi t f or dsBeac hi tappear st hat t her e ar e onl y gui del i nes and no s t r i ctr ul eson how a mer er eal i s at i on c an be s epar at ed f r om a s al e under t ak en i n a bus i nes s manner .Howev er ,t he bus i ness l i k e appr oac ht ot he di s pos ali s an i mpor t ant di s t i ngui s hi ngf ac t or .Thi si ss eeni nSt at ham vFCT( 1988)20ATR 228wher et hel ackofi nv ol v ementi nt he dev el opmentbyt heownerwasacons i der at i oni nt hec our thol di ngt hatt hes al ewasamer er eal i s at i on.I n St r at ham,t hepr oper t ywasdev el opedandfi nal l ys ol dass ubdi v i dedl ot st hr oughar eales t at eagents ot her e wasahi ghdegr eeofdev el opment .I nPet er ' scas et her ei sas t r ongchanc et hatt hi swi l lbeseenasan i s ol at edbus i nes st r ans ac t i onwi t ht henetgai nt ak enasor di nar yi nc omeunders65bec aus eoft hee x t entof t he dev el opmentunder t ak en.The mai n cas e agai ns tt hi sc onc l us i on woul d be t hatPet erhad l i mi t ed i nv ol v ementi nt hepr oc es s . Cl ear l yt hesef act sdonotgi v er i s et ot heappl i c at i onoft hefi r s ts t r andofMy erasPet erdi dnotpur c has et hi s pr oper t ywi t ht hei nt ent i onofpr ofi t i ng t hr oughi t ss al e.The pr oper t ywasi ni t i al l ypur c has edt oc onducta f ar mi ngbus i nessandt hef ac tt hathemayhav ehadi nt hebac kofhi smi ndt hatt hel andmayats omet i mebe s ol datapr ofi ti snots uffic i entt oappl yMy er :Wes t fi el dLt dvFCT. I ft hes al ei snotor di nar yi nc omei tmaybes ubj ec tt oCGT. Quest i on8. 4 I n1983Br uc epur c has es10hec t ar esofl andf or$1mi l l i oni nanar eat hatwasr i pef ors ubdi v i s i on.Att het i me ofpur c has ehei nt endedt ogetpl anni ngper mi ss i onf r om t hel oc alc ounc i lt odev el opt hel andbys ubdi v i si on andt henr es el li tatapr ofi t ,buti ns t eadhel eas edi tf orgr az i nghor ses .Thr eey ear sagoBr uceat t empt edt o getpl anni ngper mi s s i ont os ubdi v i dehi s10hec t ar es ,buti tpr ov edv er ydi ffic ul t ,andfi nal l yi nMar c hoft he c ur r entt axy eart hel ocalc ounc i lr ef us edper mi s s i ont os ubdi v i de.Br ucer el uct ant l ys ol dt hel andi nMayf or $3mi l l i on.

Whatar et het axc ons equencesofBr uc e’ ss al e ? Answer AsBr ucehasnotunder t ak enabus i nes sofdev el opment ,t hepr i nci pl ef r om FCTvWhi t f or dsBeachPt yLt d ( 1982) 12ATR 692cannotappl y .Ther ef or e,t hei s s uet hatmus tbec ons i der edi swhet hert hefi r s ts t r andof My erwoul dmak et hi ss al eor di nar yi nc omeandas s es s abl eunders65orwhet heri ti samer er eal i s at i onand

4

Principles of Taxation Q&A – Income from Business t her ef or ec api t ali nnat ur e.Thefi r s ts t r andofMy erwi l lappl yi ft her ei sac ommer c i alt r ans act i onent er edi nt o wi t hani nt ent i ont opr ofi tandt hepr ofi tul t i mat el yr eal i s edar i sesf r om t hei ni t i al i nt ent i on. Thef ac t sc l ear l yi ndi cat et hatBr uc epur c has edt hi sl andwi t ht hei nt ent i onofs ubdi vi di ngi tands el l i ngi tata pr ofi t .Howev er ,t hei ni t i alpl annev ercamet of r ui t i onandt hepr oper t yhadt obes ol dbec aus ei tc oul dnotbe s ubdi vi ded.Nev er t hel es s ,t her ei ss t i l lt hepos s i bi l i t yoft heappl i c at i onoft hefir s ts t r andofMy eront hebas i s t hatt hepr oper t ywaspur c has edwi t hani nt ent i ont odev el opi tands el l i tatapr ofi t . I ft hes al ei snotor di nar yi nc ome,i tmaybes ubj ec tt oCGT .

5

Principles of Taxation Q&A – Income from Business Quest i on8. 5 T woy ear sagoPet apur c has edahous ei nKew.Thi shous ehadt wool dt enni scour t sdownt hebac kwhi c h wer ei npoorc ondi t i on.Shepur c has edt hepr oper t yf ort wor eas ons :

 

s ot hatsheandherf ami l yc oul dl i v ei nt hehous e;and s ot hatshec oul dbui l dt hr eeuni t sont het enni sc our t sands el l t hem atapr ofi t .

I nt hec ur r entt axy eart het enni sc l ubnex tdooroffer edt obuyt heol dt enni sc our t s ,butonl yi fPet afi r s t r es t or edt hem t ogoodc ondi t i on.Pet adec i dedt oac ceptt hec l ub’ sofferi nst eadofgoi ngaheadwi t hherpl an t obui l dandsel l uni t s .

Pet as pent$100, 000onpr epar i ngt het enni sc our t sf ors al e.Thi si nv ol v edagr eatdealofwor k .Pet ahadt o r es ur f ac et het enni sc our t sandbui l dnew f enc esar oundt hem.Shet hens ol dt het enni sc our t si nt hec ur r ent t axy eart ot het enni sc l ubf or$600, 000.

I gnor i ngc api t al gai nst ax ,di s c us swhet hert her ec ei ptof$600, 000i sor di nar yi nc omeunders65. Answer Thi si sani s ol at edt r ans ac t i oni s s ue,underwhati scommonl yknownast he“ fi r s tl i mbofMy er s ”–i e,i fa c ommer c i alt r ans ac t i onhasapr ofi t maki ngpur pos e,t hent hepr oc eedswi l lbeor di nar yi nc omeunders65. Howev er ,f ort he“ fi r s tl i mbofMy er s ”t oappl y ,t hepr ofi t maki ngpur pos eonac qui r i ngt heas s etmus tal s obe c ons i s t entwi t ht hewayt hepr ofi twasev ent ual l ymade( Wes t fi el d) . Fort hes al et obeor di nar yi ncomeunderMy er ,bot ht hec ommer c i alt r ans ac t i onandt hei nt ent i ont opr ofi t mustbes hownand,asPet adoesnotappeart obei nbus i ness ,t hei nt ent i onmus tbepr es entatt het i meof ac qui s i t i on.I nt hi scas et hef act si ndi c at et hatPet ahadani nt ent i onofpr ofi tt hr ought hedev el opmentands al e ofpar toft hepr oper t ys oi tc oul dbear guedt hatt hei nt ent i onex i s t ed.Howev er ,t heor i gi nalpl anwasnot pr oc eededwi t handf orMy ert oappl yi twoul dbenec es s ar yt os how t hatt hei nt ent i onofpr ofi ts ur v i v edt he c hangei npl an.I nc ont r as t ,i tc oul dbear guedt hatt heor i gi nali nt ent i onwasabandonedandt hatt hi si sa mer er eal i s at i onatt hebes tpos s i bl epr i c e,asi nWes t fi el d.Thef actt hatPet awasappr oachedbyt het enni s c l ubs uppor t st hevi ew t hatt hi si sac hangei npl an,andi tcoul dbear guedt hatt heor i gi nali nt ent i onhasbeen abandoned. TheCommi s si onermaydi s agr eewi t ht hi sbas edont hev i ew s etouti nTR 92/ 3at[ 5558]andar guet hatan amountwi l l beas s es s abl ei ft het ax pay er : a) ac qui r espr oper t ywi t ht heapur pos eofmak i ngapr ofi tbywhi c hev ermeanspr ov emos ts ui t abl eand apr ofi ti sl at erobt ai nedbyanymeanswhi c hi mpl ement st hei ni t i al pr ofi t mak i ngpur pos e; b) ac qui r espr oper t yc ont empl at i nganumberofdi ffer entmet hodsofmak i ngapr ofi tandus esoneof t hos emet hodsi nmaki ngapr ofi t ;or c ) ent er si nt oat r ansact i onwi t ht hepur poseofmak i ngapr ofi tbyonepar t i c ul armeansbutac t ual l y obt ai nst hepr ofitbyadi ffer entmeans . I nCas e1( 1999)99ATC 101,t heAATs t at edt hatt hes epar agr aphsofTR 92/ 3wer e“ wr ongands houl dbe r ewr i t t en” .Sowhatdi dt heHi ghc our tmeani nMy er ?Cas e1of1999i nv ol v edani nt ent i ont omak eapr ofi tbut t heac t ualpr ofi twasmadei nadi ffer entway .Thecour t ss ai di twasnonas s es s abl e.Al s oi nFCTvHaas s ( 1999)99ATC 4814i twashel dt hatt heamountwasas ses s abl ebec aus et hewayi nwhi c ht hepr ofi twas madewasonl ys l i ght l ydi ffer entt ot hewayi nwhi c hi twasor i gi nal l yi nt ended.I ft het ax pay eri nt endedt omak e apr ofi tbyanynumberofal t er nat i v es ,ev ent hought heac t ualmet hodhadnotbeendet er mi nedi ni t i al l y ,t he pr ofi tmays t i l lbeas s es s abl e.Thati s ,t hei nt ent i onwast os el latapr ofi tbutt hepr ofi twasmadei nawayt hat wasnots peci fic al l ys etoutatt het i met heac qui s i t i onwasmade.

6

Principles of Taxation Q&A – Income from Business

I tcoul d al so ar gue t hatt he pr ofi ti sas s es s abl e underWhi t f or dsBeac h –i e,Pet ai si nt he bus i nes sof r ec ondi t i oni ng t enni scour t s .I nt he Whi t f or dsBeac hc ase,i twass ugges t ed byt he j udgest hata s i mpl e s ubdi vi s i onands al eofl andwoul dnotbeor di nar yi ncome,butamer er eal i s at i on.Howev er ,anex t ens i v e dev el opmentofl and( whi chi nc l udesnotonl yas ubdi v i s i on,butal s oc onst r uc t i ngr oads ,et c )woul dc onst i t ut e abus i nes sands o woul d be or di nar yi nc ome.Appl y i ng t hi spr i nc i pl et o Pet ar equi r esa det er mi nat i on of whet herwhats hehasdonei senought os howabus i nes sorc ommer c i al i nt ent–t hi si saques t i onoff act . Quest i on8. 6 Mr sJ onesi st heownerofal ar ger acehor s est udandhor s et r ai ni ngbus i nes s .Sheempl oy sei ghts t affand hol dsat r ai ni ngl i c enc e.Mr sJ ones ’i nv ol v ementi nt her ac i ngbus i nes si sherf ul l t i meoc c upat i onands he at t endsasmanyr ac emeet i ngsaspos s i bl e( ov eroneperweek ) .Mr sJ onesi sal s oav er yk eenpunt er ,bet t i ng onbot hherownandot herhor s es ,anddur i ngt hel as ty ears hehads ev er alv er ybi gwi nswhi c hnet t edher $120, 000i nwi nni ngsf ort hey ear .

Di s c us swhet hert her ec ei ptof$120, 000i sor di nar yi nc omeunders65.

Answer Cons i derwhet hert hebet t i ngi sabus i nes sact i v i t yoni t sownandt her ef or eor di nar yi ncomeor ,i fnot ,i st he punt i ngat r ansact i onoft hehor s et r ai ni ngandr ac i ngbus i nes sandt her ef or eor di nar yi ncomeunders65? Fr om t hedec i s i onsi nBabk avFCT( 1989)20ATR1251andEv ansvFCT( 1989)20ATR922,i tc anbes een t hatt hec our t shav eappl i edahi ghert es tofbus i nesst ogambl i ngac t i v i t i es .T obej udgedasbei ngi nt he bus i nes sofgambl i ngi ti snec es s ar yt os how t haty out ak eac ommer c i aldec i s i oni nr el at i ont ot hegambl i ng. Thi swoul dr equi r et heabi l i t yt oal t ert heoddsort omanaget her i s ks ,s uc haswoul dbet hec as ef orac as i no orbook mak er .I ti snotl i k el yt hatt hegambl i ngwoul dbeabus i nes si ni t sownr i ghti nt hi sc as e. I ti smor el i k el yt hatt hegambl i ngwi l lbepar toft hehor s er ac i ngandt r ai ni ngbusi nes s ,asi nPr i nc evFCT ( 1959)7AI TR 505.I nt hi sc as ei tcoul dbear guedt hatt hehi ghl ev elofpar t i c i pat i oni nt hehor s er ac i ng bus i nes smak est hegambl i ngpar toft hebus i nes s .Thi si saques t i onoff ac tandac onc l us i onei t herwayi s fi ne.

Quest i on8. 7 Pi er r ehasoper at edhi smar k etgar denbus i nes si nQueens l andf ort hel as tt hel as t2...