The Tax Court of Canada and the Federal Court of Appeal have predominantly held that the standard of care required of directors to meet the due diligence defence test in s. 227.1(3) of the Canadian Income Tax Act is subjective. Not only is the basis for these decisions questionable, but the resulting inconsistencies and uncertainties depart from a coherent system of rational law. Published in the September 2010 issue of Canadian Lawyer as part of Bryan Haynes' regular column.