What is the nature of a dividend?

It is important to note, first, what the nature of a dividend is and what payment of a dividend means. In Neuman v. M.N.R., 1998 CanLII 826 (SCC), [1998] 1 S.C.R. 770, Iacobucci J. rejected the argument that payment of a dividend is related to the amount of effort deployed by the recipient on behalf of the corporation, which would constitute valuable consideration. He quoted a remark of La Forest J. in McClurg v. Canada, 1990 CanLII 28 (SCC), [1990] 3 S.C.R. 1020: "a dividend is received by virtue of ownership of the capital stock of a corporation" and it is "a fundamental principle of corporate law that a dividend is a return on capital which attaches to a share, and is in no way dependent on the conduct of a particular shareholder".