26. For the purposes of this act, the ownership, usufruct or enjoyment of any property shall be deemed to be transmitted owing to death:
(1) Whenever the deceased has disposed thereof by gratuitous title in any manner whatsoever and the said disposition has taken effect within the five years prior to the death of the person by whom it was made; when the subject matter of such disposition is a sum of money, the disposition, for the purposes of this act, is deemed to take effect only on the date on which the said sum is really paid;
(2) Whenever the disposition of such property by gratuitous title in any manner whatsoever has taken effect more than five years prior to the death of the person by whom it was made and the said person has not actually and absolutely divested himself of his ownership in the entirety of the said property, of his right to collect and receive the fruits thereof, or has had the use, custody or administration of the said property or has continued to receive the fruits thereof, or has received from the donees or other persons any compensation whatsoever in lieu of the entirety or of part of the said fruits, or has stipulated that the said property could not be alienated by onerous or gratuitous title, pledged or hypothecated, or that the proceeds thereof could not be invested or appropriated without his consent or that of a person by him designated; or whenever the pledge, alienation or hypothecation of such property, or the investment of the proceeds thereof, took place with the disposer’s consent, directly or indirectly; or whenever the disposer has reserved to himself the right to revoke the disposition in whole or in part, or has stipulated any charge or payment in his favour or in favour of another, alone or jointly with himself, or has stipulated that such property shall return to him or his estate, heirs, donees or legatees, or has reserved to himself the right to appoint other beneficiaries or depositaries of the said property or has actually made such appointment.
This section shall not apply
(a) to one or more gifts intervivos, in favour of the same donee, the aggregate value of which in the same calendar year does not exceed two thousand dollars;
(b) to one or more gifts intervivos of agricultural property in Québec by a farmer to another farmer, except his child, or to the consort of the latter farmer, when the value of the property so given does not exceed ten thousand dollars in all. If such value exceeds ten thousand dollars, the excess only shall be deemed to be transmitted owing to death;
(c) to a gift intervivos, to a child of the donor, made once in his lifetime, of land or other agricultural property that such child receives alone or jointly to be used in farming operations carried on by that child, where the value of the property so given does not exceed in all seventy-five thousand dollars. If that value exceeds seventy-five thousand dollars, the excess only is deemed to be transmitted owing to death.
The validity of a gift or disposition contemplated by the provisions of paragraphs 1 and 2 of this section and of subsequent transmissions or transfers of property subject thereto shall not be affected by the non-payment of the duties imposed by this act.
R. S. 1964, c. 70, s. 22; 1972, c. 29, s. 12; 1973, c. 17, s. 167.