Does Russell Tax Court Order Validate Apus Theory?

Does the Russell
Tax Court Order

Validate
Apu’s Theory?
aka
“Apu’s Theory, Part 4”
by
Apu Nahasapeemapetilon, Ph.D. (Caltech)

© 2018 CC-BY-4.0
www.CanadaIncomeTaxIsLegal.is
Does the Russell Tax Court Order Validate Apu’s Theory?
Table of Contents
Tab
Background, Authorship, and Copyright Notice A
Analysis – aka “Apu’s Theory, Part 4” B
Russell - Notice of Objection to CRA1 C
CRA – Reassessment’s Notice of Confirmation D
Russell – Notice of Appeal (“Pleadings”) to TCC2 E
Russell – Notice of Appeal – Book of Authorities F
Russell – Notice of Appeal – Book of Documents G
DoJ3 – Intro Letter; Motion to Strike H
Russell – Why Appeal Not Frivolous nor Vexatious I
DoJ – Motion to Strike – Written Representations J
DoJ - Motion to Strike – Book of Authorities K
Russell – Motion to Strike – Oral Submission (1 hour) L
TCC Order M
TCC Order Transcript N
Russell – Response to CRA Statement of Account O

1
CRA = Canada Revenue Agency
2
TCC = Tax Court of Canada
3
DoJ = Department of Justice (Canada)

Tab A
Background
Authorship and
Copyright Notice
https://CanadaIncomeTaxIsLegal.is

Background
This is the first tax case applying Apu’s Theory on Canadian individual income tax.
Canada would like you to believe that it will also be the last. Basically, to rule for
Canada, the only way the Tax Court of Canada (“TCC”) could do that was by
ignoring both case law precedents and the rule of law. So that’s what they did.
The taxpayer, Russell, applied Apu’s Theory and so filed all income. He filed income
that is Canada’s public money on CRA T1 forms. He also reported to CRA all private
property income, but by letter. CRA then reassessed his private property income as
if it is Canada’s public money.
Russell filed a Notice of Objection, which included Apu’s Theory, Part 1 (Tab C). But
CRA rejected it and issued a Notice of Confirmation (Tab D). He then appealed to
the Tax Court of Canada (Tabs E, F, and G).
The Department of Justice (“DoJ”) told him they would be applying for a motion to
strike, as they believe his position is frivolous and vexatious (Tab H). He explained
why he believes his appeal is not (Tab I). Nevertheless, the DoJ filed their motion to
strike (Tab J) along with their Book of Authorities (Tab K).
During the hearing, Russell read his prepared speech (Tab L). Despite that, the TCC
changed his facts, granted CRA’s motion, and struck his appeal (Tab M). But both
the Department of Justice (“DoJ”), and the TCC admitted that, for a motion to strike,
Russell’s stated facts (Tab E) must be assumed to be true! The official court
transcript (Tab N) includes Russell’s speech from Tab L. Apu’s Theory, Part 4, our
analysis of the facts the TCC changed, is at Tab B.
Afterwards, CRA issues Russell a new Statement of Account, with all his private
property reassessed as Canada’s public money. Russell wrote a letter re-asserting
his private property has never changed status into Canada’s public money (Tab O).
Authorship and Copyright Notice
Various contributors from our website co-authored Russell’s pleadings (Tab E),
speech (Tab L), and response to CRA’s reassessment (Tab O). That is why those
documents have our website address. They are all copyrighted under a Creative
Commons Attribution 4.0 International Licence (CC BY 4.0). Adaption and sharing
are encouraged, per the terms here: https://creativecommons.org/licenses/by/4.0/.
We have redacted all private information per Scribd’s Prohibited Use policy. If we
missed any, please contact us through our website.
Tab B
Apu’s Theory
Part 4
Version 2.2

Does the Russell Order Validate Apu’s Theory?

(aka “Apu’s Theory, Part 4”)
Summary
While not initially obvious, it seems the Russell Tax Court order validates “Apu’s
Theory”, our individual income tax research. This is because the court acknowledged
Russell’s pleaded facts “are assumed to be true”. But the court then changed his facts
to justify the order for Canada! In other words, it seems if the court had not changed
Russell’s facts, it would then have to rule for him. But, by changing them, the court
ignored case law precedent and the rule of law.
Canada is now using Russell to say Apu’s Theory is wrong. Read the rest of the story,
and find out how his order seems to validate Apu’s Theory!
Why the Court Shenanigans?
Russell v. The Queen1 seems to validate “Apu’s Theory2”, our research on Canadian
individual income tax. We continue researching because, over 100 years later, it seems
Canada still does not tell even lawyers3 and accountants how it really works. Apu’s
Theory is not saying the present dogma is wrong, but that both can co-exist.
Since this order blocked Russell’s appeal from going to trial, no court decision can be
made on his pleaded facts based on Apu’s Theory. It also blocks the public from
finding out what really happened. The result is Canada is now using Russell for
promoting Apu’s Theory as wrong4.
That is why this paper includes Russell’s submissions. Now, you can compare, side-
by-side, his pleaded facts versus the ones the Tax Court changed and used against
him. The result? You might conclude Apu’s Theory could be correct.
Russell Filed Using Apu’s Theory
Russell is an alternative health care professional5 near Vancouver, British Columbia. He

earned both T4 income (i.e., Canada’s “public money”6) and private property income.

1
William Russell v. Her Majesty The Queen, 2016 TCC 122 (CanLII); or “Russell order” (Tab M).
2
Apu’s Theory, Part 1: Nahasapeemapetilon, Apu, Unreported Income Not on a CRA T1 Form is Not
Always Tax Evasion; https://ssrn.com/abstract=2800623; Apu’s Theory, Part 2: Attorning to Canada's
Income Tax Act Office (or, Why Is the Name in All Caps?): https://ssrn.com/abstract=2801642; Apu’s
Theory, Part 3: see our blog article at https://canadaincometaxislegal.is/apus-theory-part-3-released/.
3
For R. v. Mori, 2017 ONSC 1551 (CanLII), http://canlii.ca/t/h2zrn; Mori’s lawyer was hired because he
agreed to argue any position. Just before trial, he refused to use Apu’s Theory (see paragraph 5).
4
R. v. , 2017 BCSC 2585 (under publication ban), at paragraphs 170,171,184.
5
Dr. William Russell’s website: http://www.askdoctorbill.com
6
“Public money” as defined by s.2 of Financial Administration Act, R.S.C., 1985, c. F-11, s.2
www.CanadaIncomeTaxIsLegal.is 1
Version 2.2

Applying Apu’s Theory, he filed his ITA officer’s T4 public money income on CRA’s T1
forms. Since 1991, CRA’s T17 uses the SIN as a “social insurance number8”. He also
filed his private property income, but by letter9, and with his SIN as a “Social Insurance
Number10”. Apu’s Theory, Part 1, concludes a SIN as a “Social Insurance Number”
identifies an individual who applied for a SIN Card11, and, as a result, also agrees to be
fiduciary liable for Canada’s public money. This fits with benefits listed on CRA’s T1
form being paid to, and from, Canada’s public money. CRA’s T1, Page 4, says pay the
Receiver General. All this also fits with Canada’s Financial Administration Act saying,
“All public money shall be deposited to the credit of the Receiver General.12”
CRA’s Response
CRA did nothing for 15 months. They then reassessed Russell’s provincial private
property income that he filed by letter as Canada’s federal public money income.
Russell appealed CRA’s reassessment to the Tax Court of Canada (“TCC”).
Russell Not Charged with Tax Evasion
The first significant validation of Apu’s Theory is that Russell was not charged with any
Income Tax Act13 (“ITA”) offences, such as false information on a return, or tax evasion.
The reason is simple: he reported all “income14”. However, until we came up with Apu’s
Theory, it seems hardly anyone knows what individual taxpayer income could be.
Court Orders Are Not Decisions
Either side can enter a motion to strike a case. If the court grants such a motion, called
an order, then that case cannot proceed further to trial. There is a distinction between
court orders, such as on motions to strike, versus court decisions on facts and law in
trials. Russell is not a court decision; it is a court order that struck his appeal. That is
why his tax appeal never went to trial.

7
CRA: T1 from 1985 to present: https://www.canada.ca/en/revenue-agency/services/forms-
publications/tax-packages-years.html
8
CRA’s definition of SIN as “social insurance number”: https://www.canada.ca/en/revenue-
agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-
address-information/social-insurance-number.html
9
Canada’s ITA and regulations do not mandate a return of income to be CRA’s T1 form. Besides,
Canada “conceded” that “ordinary employment” (such as provincial private property) is outside federal
jurisdiction: Reference re legislative jurisdiction of Parliament of Canada to enact the Employment and
Social Insurance Act (1935, c. 48), [1936] SCR 427, at page 428: http://canlii.ca/t/fslwj
10
CRA’s definition of SIN as a Social Insurance Number: https://www.canada.ca/en/revenue-
agency/services/tax/businesses/definitions-letter-s-business.html. CRA even has a webpage using both
styles of SIN: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-
overview/employer-responsibilities-payroll-steps/hiring-employee.html
11
SIN Application: NAS-2120. Canada no longer issues SIN Cards, but confirmation of SIN letters.
From s.17(1) of the Financial Administration Act, R.S.C., 1985, c. F-11, s.2
12
13
Canada’s Income Tax Act, R.S.C., 1985, c. 1 (5th Supp.)
14
There is no definition for “income” in Canada’s ITA.
Version 2.2

Why Canada Desperately Needed Russell’s Case Struck
Canada has a common-law based legal system. This means Canadian law follows
stare decisis. Duhaime’s online law dictionary defines stare decisis15:
Stare Decisis: “A basic principle of the law whereby once a decision (a precedent) on a
certain set of facts (emphasis ours) has been made, another Court of the same rank or
lower, must apply that decision in cases presenting the same set of facts.
The precedent becomes binding and must be followed by courts of like rank.”
#1 Bad for Canada: (if Apu’s Theory is Correct)
Let’s assume Apu’s Theory is correct. It would then be very dangerous to Canada to
have Russell’s case go to trial, because he would have a good chance of winning.
Worse still, a win means anyone else who earns private property income then can also
use stare decisis to justify why their private property income is also not taxable. In
other words, once you let one horse out, you can never close the gates again!
So you can see why Canada desperately needed to win this case – and, it seems,
stare decisis, as well as rule of law, be damned16. But how could Canada do that?
From Canada’s viewpoint, TCC rules17 means these possible outcomes:
1) Motion to strike the case, block it from going to trial

a. TCC grants Crown’s motion to strike (good – win on public record), or
b. Taxpayer wins Crown’s motion to strike (bad – case goes to trial)
i. Case goes to trial
1. Canada wins (good – Canada’s win on public record)
a. Taxpayer appeals; wins at Federal Court of Appeal
(really, really bad), or
2. Taxpayer wins (very bad – Canada’s loss on public record)
a. Canada appeals, and wins (good – win on public record)
You can see why Canada needed to win their motion to strike. This prevents the case
from going to trial, along with all its possible outcomes. In addition, going to trial
means discussions and arguments are on the public record. Obviously, if Apu’s Theory
were correct, that would be the last thing Canada wants! So, to ensure not going to
trial, the TCC rigged the game by changing Russell’s facts to the opposite of what he
stated (“pleaded”)!

15
More on “stare decisis” at: http://www.duhaime.org/LegalDictionary/S/StareDecisis.aspx
16
CRA has sometimes argued public policy overrides the ITA. Apu’s Theory, Part 3, addresses this.
17
Tax Court of Canada Rules (General Procedure), SOR/90-688a: http://canlii.ca/t/52708
Version 2.2

Then, due to stare decisis, the Russell order blocks all future trials and court decisions
about Apu’s Theory from happening… or so Canada wants you to believe!
Why You Need the Rest of the Story
However, from earlier, Duhaime’s states stare decisis applies only “on a certain set of
facts”. By exposing that the TCC changed Russell’s facts, this should mean that order
can no longer be used to block future trials on Apu’s Theory.
Furthermore, as the order was justified using facts opposite of Apu’s Theory, it is like a
negative averment18. Arguably, it is like a mirror image of a positive announcement19
validating Apu’s Theory. That is why you need the rest of the story!
Court’s Reasons For Striking Russell’s Appeal
Crown’s position for striking Russell’s case is that it is, “scandalous, frivolous or
vexatious; an abuse of process; discloses no reasonable grounds for appeal.”20
Crown: Russell an “OPCA Litigant”
Crown claims Russell is an Organized Pseudolegal Commercial Argument litigant

(“OPCA litigant”). Judge Rooke invented the term in the Meads divorce case21. (OPCA
is any theory that does not follow Canada’s dogma about how Canadian law works.)
Russell: Not “OPCA Litigant”

Russell realized beforehand this would be Crown’s position. That is why his Notice of
Objection to CRA, pleadings, and oral argument distinguish his facts from OPCA ones.
They all explain why he does not fit the mold of an “OPCA litigant”.22 That is why, to
justify the court order for Canada, the TCC was forced to change his pleaded facts.
#2 Bad for Canada: Russell Winning Would Discredit Meads
If Russell had won, that would bring up a second problem. Meads is now the go-to
case for getting rid of anything Canada doesn’t like in courts. That is why, less than six
years later, other court cases have already cited Meads 164 times. Tax law blogs often
discuss Meads. Basically, it is a 21st-century legal tool for continuing obfuscating the
ITA and other laws. (That includes obfuscating accountants and lawyers.)

18
“Negative averment”: R. v. Appleby, [1972] SCR 303, http://canlii.ca/t/1nfms, at page 314.
19
“Positive announcement”: Montreal v. Montreal Locomotive Works Ltd., 1946 CanLII 353 (UK JCPC),
http://canlii.ca/t/grjdk, at page 170.
20
Crown’s Written Representations for Motion to Strike, Tab J, at paragraphs 7,9,10.
21
Meads v. Meads, 2012 ABQB 571, http://canlii.ca/t/fsvjq, Tab K, at paragraph 1.
22
Russell’s Notice of Objection, Tab C, (in attached Apu’s Theory, at Section 45); pleadings, Tab E,
paragraphs 101-102; oral argument, Tab L, paragraph 4; transcript, Tab N, page 18, lines 13-23.
Version 2.2

But if Russell’s position (and, by extension, Apu’s Theory) were correct, that means
Meads is wrong (or, at least, misleading23). This would be tremendously embarrassing
to Canada. It could lead to class-action lawsuits. Hey, why don’t we just continue
keeping taxpayers in the dark for another 100 years? Yeah, let’s go with that instead.
That is another reason why the TCC changed Russell’s pleaded facts. In short, Meads
means Canada got caught with its hand stuck in the cookie jar.
#3 Bad for Canada: PEG Taxpayers Jailed Due to Non-Disclosure
If Russell had won, that would bring up a third problem. Numerous individuals have
been jailed for tax evasion. Most were with Paradigm Education Group (“PEG”). PEG
taught individuals human rights. Many PEG participants worked under a PEG “Contract
for Hire” (“CFH”). The CFH stated the payee does not wish to receive income under it
as Canada’s public money, but as their private property. (Russell participated in PEG.)
Apu’s Theory concludes PEG is fundamentally sound. But, due to Canada obfuscating
the ITA, PEG had not yet figured out accepting T1 benefits is also evidence of receiving
income as Canada’s public money, and therefore income tax is owing24. We believe
that is how, and why, Canada has convicted25 over 60 PEG participants. But, arguably,
they were all convicted because Crown never gave any of them full disclosure! This
could also lead to another batch of class-action lawsuits.
#4 Bad for Canada: Tax Evasion Charges are only on ITA Officers
Canada’s fourth problem is that if Apu’s Theory is ruled as correct, then it confirms
only ITA officers26 can be charged with tax evasion. But since such offices’ incomes
are Canada’s public money, holding such offices impose onerous fiduciary duties. That
means holding such a position must be voluntary. But what if a taxpayer has already
reported to CRA his intention to not receive income that year as Canada’s public
money, and consequently declines to hold an ITA office27? That would mean such a
taxpayer could legally deflect any tax evasion charges, which apply only to ITA officers.
He or she could then answer a tax evasion summons by attending court and stating, “I
am not the person (ITA “officer”) on the Information charged with income tax offenses,
even though we both have the same name, and they both sound the same28.” In short,

23
Conveniently for Canada, even if Meads is misleading, judges, as court officers, are exempt from libel.
24
For example, in R. v. , 2017 BCSC 2585 (under publication ban), at paragraph 235, the
taxpayer rejected all benefits (such as deductions) on the T1s. Despite that, the court insisted on
applying T1 deductions, and then found the taxpayer guilty!
25
A stark example of CRA entering T1 deductions, as evidence, is R. v. Porisky & Gould, 2012 BCSC 67,
paragraphs 25 to 29, http://canlii.ca/t/fppg9 (Tab F). Porisky started Paradigm Education Group (“PEG”).
26
De Facto Doctrine, by Canadian judge Albert Constantineau, says anyone dealing with public money
must be an officer: https://canadaincometaxislegal.is/taxing-and-spending-powers-needs-public-money/
27
A CRA TD1 does exactly the opposite; signing one means your intent is to receive public money.
28
Officers, as artificial persons in law, are often referred to by the private person’s name, and are usually
(but not always) styled with all upper case letters.
Version 2.2

the summoned individual attended court, but nobody appeared to represent the ITA
officer.
Of course, CRA does not want people to do that29. So that could be the fourth reason
why Canada had to get Russell’s appeal struck - or else face more lawsuits.
#5 Bad for Canada: Apu’s Theory Could Help Explain All Canadian Laws
Canada’s fifth problem is that Apu’s Theory could help explain all Canadian laws.
Apu’s Theory already shows how Canada’s Income Tax Act, Canada Pension Plan,
Excise Tax Act (for GST), Employment Insurance Act, and Financial Administration Act
are legally linked with each other (as they all deal with Canada’s public money).
Therefore, while Apu’s Theory started as an attempt to unravel how individual income
tax really works, arguably, it could be better viewed the other way around: it could help
explain how Canada’s legal system really works, of which the Income Tax Act is but
one statute. That is why we just blogged about this30.
In summary, these are five compelling reasons why Canada had to get Russell’s
appeal struck. It seems their hand is stuck really, really deep in the cookie jar. And it
also seems they’ve committed numerous illegal acts.
Russell’s Pleadings
Duhaime’s defines pleadings as:
That core document(s) of a party to litigation in which he or she formally sets

out the facts and the law, which support that party's position.
Russell’s pleadings are another legal name for his Notice of Appeal, at Tab E.
Crown’s Motion to Strike
The Crown’s written representation for their motion to strike is at Tab J.
Court Hearing on Motion to Strike
The Crown first presented their case. Russell then read his prepared speech (Tab L).

29
PEG students Clarke and Mary Margaret Webster attended court. Crown ordered them to leave, then
asked for bench warrants because they allegedly failed to attend! Both were arrested and thrown into the
notorious Ottawa-Carleton Detention Centre, where many have died. That’s why, after being incarcerated
for 92 days (Clarke) and 16 days (Mary), due to the duress, both pled “guilty”. Ottawa lawyer Michael
Johnston, disgusted with Crown’s behaviour, represented Clarke partly pro bono. The result is Clarke,
being “guilty” of tax evasion, can practice dentistry only while under supervision by another dentist.
30
Canadian Human Rights Vary, Depending on “You”: https://canadaincometaxislegal.is/canadian-
human-rights-vary-depending/
Version 2.2

TCC: Order Granted to Crown
The TCC’s Russell order struck his case. It is at Tab M. The transcript is at Tab N.
But Russell’s Pleaded Facts Must be Assumed to be True
The Crown’s written representation for motion to strike (Tab J) agrees the taxpayer’s
pleaded facts must be taken as true:
8. An order to strike a Notice of Appeal in its entirety under Rule 53 is an extraordinary

remedy. The following rules apply31:
(a) The facts alleged in the impugned pleading must be taken as true.
The Russell order concurs with Crown’s position; Tab M, paragraph 5 states:
[5] When considering a motion under section 53 of the Rules, the facts alleged in the
pleading are assumed to be true: Operation Dismantle v Canada32, [1985] 1 SCR 441
at 455.
Therefore, changing Russell’s facts means the TCC ignored stare decisis not once, but
twice: by the Tax Court of Canada, and by the Supreme Court of Canada (“SCC”).
Basically, they purposely ignored both stare decisis and the rule of law to guarantee
getting their order. As we saw why earlier, Canada was desperate to win at any cost.
Compare Russell’s Facts to TCC’s Facts
On the next page, Section 1 summarizes Russell’s pleaded facts versus the so-called
“facts” the TCC used. Section 2 then lists Russell’s conclusions of mixed fact and law.
However, being a motion on whether to strike Russell’s appeal, the TCC here has no
jurisdiction to rule on Russell’s conclusions of mixed fact and law.
That is why the TCC had to use Section 1’s changed “facts” to indirectly infer Russell’s
Section 2 mixed fact and law conclusions as wrong (by painting him as an “OPCA
litigant”.) But since the TCC changed Russell’s pleaded facts, in reality the TCC’s
inferred conclusions have no merit.
Conclusion
It is blatantly obvious that Canada ignored stare decisis and the rule of law to preserve
their revenue. That is why exposing the corruption is the only solution. In conclusion,
do you now think Apu’s Theory could be correct?

31
Sentinel Hill Productions (1999) Corporation v. Her Majesty the Queen 2007 TCC 742, paragraph 4.
32
Operation Dismantle v. The Queen, [1985] 1 SCR 441, http://canlii.ca/t/1fv0g
Version 2.2

Section 1
Russell’s Pleaded Facts “Facts” TCC Used for Order

Reported all income33. Admitted to excluding income in tax returns34.

All income subject to tax under the ITA35 Cannot contract out of application of ITA36.
Not all legal obligations are contracts37. All legal obligations are contracts38
Obligations can be fiduciary39 All legal obligations are contracts40
Taxpayer can be two legal persons41 Taxpayer exists in two separate states42
All income subject to tax under ITA43 Tax depends on the state chosen44

33
Notice of Objection, Tab C, page 4; pleadings, Tab E, paragraph 5,7,12; oral submission, Tab L,
paragraph 2; Russell order, Tab M, paragraphs 12, 18(e), 20.
34
Russell order, paragraphs 25 and 28.
35
Notice of Objection, pages 2-3; pleadings, paragraphs 142-143,146; Russell order, paragraphs 10,
18(c),18(f), 20.
36
Russell order, paragraph 22.
37
Notice of Objection, page 3; pleadings, paragraphs 168-173; Russell order, paragraphs 18(g), 20.
38
39
Notice of Objection, page 3; pleadings, paragraphs 168-169,171-173; Russell order, paragraphs 18(g).
40
41
Notice of Objection, page 2-3; pleadings, paragraphs 94-102; Russell order, paragraph 18(a).
42
43
Notice of Objection, page 2; pleadings, paragraphs 4-7,142-143; Russell order, paragraphs 10,18(c).
44
Version 2.2

Section 2
The TCC’s strategy is simple. First, it changed Russell’s facts from Section 1, and so
molded him to fit an “OPCA litigant”. Second, it wrongly infers Russell’s conclusions of
mixed facts and law listed below are wrong, by replacing them with OPCA beliefs.
But since the TCC changed Russell’s pleaded facts in Section 1, none
of these
Section 2 conclusions below, inferred as being wrong,
have any merit!
Russell’s Mixed Facts & Law TCC: Facts & Law Are Wrong

Public money links: ITA, CPP, EI, ETA (GST)45 Statutes other than ITA are not relevant46
Income can be private property or public money47 Not addressed
Private contract income is his private property48 Not addressed
T1 public money income means fiduciary49 Not addressed
First legal person: as private person Not addressed; used ambiguous “individual”50
Officer only way to be second legal person51 Not addressed
Taxpayer can be an officer52 Missing: ITA office income is public money
SIN has two meanings53 Mentioned, but not addressed54
Social Insurance Number = being liable55 Not addressed
A social insurance number = ITA office(r)56 Not addressed
ITA office income is public money57 Not addressed
Private employment outside federal jurisdiction58 Not addressed
Doesn’t fit any of CRA’s 10 tax protestor positions59 Not addressed

45
Pleadings, paragraphs 15, 156-157, 164-168; Russell order, paragraphs 18(g).
Russell order, paragraphs 16-17.
46
47
Russell order, paragraph 18(f).
48
Russell’s private contract, at Tab E, Notice of Appeal, Appendix B, at page 2 of 6 (= Appeal’s page 32).
49
Russell order, paragraphs 18(e) and 18(g).
50
Russell order, paragraph 23. Someone representing an officer can still be called an individual!
51
Meads v. Meads, 2012 ABQB 571, http://canlii.ca/t/fsvjq; at paragraph 445: “If a person wishes to add a
legal ‘layer’ to themselves, then a corporation is the proper approach.” Sir Edward Coke states an officer
is also called a corporation sole: https://canadaincometaxislegal.is/canadian-human-rights-vary-
depending/. Therefore, an officer is a corporation – just a special kind.
52
Russell order, paragraphs 18(e) and 18(g).
53
Notice of Objection, pages3, 5; pleadings, paragraphs 93, 174-180; Russell order, paragraphs
13,16(d).
54
Russell order, paragraph 16(d).
55
Notice of Objection, page 3; pleadings, paragraphs 174-178.
56
Notice of Objection, page 3; pleadings, paragraphs 174-178.
Notice of Objection, page 3; pleadings, paragraphs 17-18, 147-148.
57
58
Pleadings, paragraph 114.
59
Oral presentation, paragraph 4; transcript, page 18, lines 13-23.

Tab C
Russell’s Notice of
Objection
to
CRA

William Russell

Avenue Surrey BC V4A

April 27, 2015

Neeta Khushalini CGA CPA
Appeals Division
c/o 9755 King George Boulevard
Surrey, BC V3T 5E1

Dear Neeta Khushalani,

Re: Notice of Objection 2010, 2011, and 2012 Income Tax Audit SIN xxx xxx

The CRA Audit Report by Janny Ng dated 2014-05-09, for WILLIAM RUSSELL has many
discrepancies and incorrect assumptions which I will attempt to address here.

In the Audit Report under “ B Business Information” it is mentioned several times that
“the taxpayer was scheduled to be at the meeting but he didn’t show up. “ It was never
agreed that I would attend the meeting. I signed a T1013 Authorization Form so my
accountant, Sandra Gibbs, could speak on my behalf as representative for both
taxpayers - as an individual and for the Corporation.

Under Audit Steps – Books & Records Examined it is referenced that Private Contracts
issued were examined. The truth is that my Private Contract (“PC”) was never asked for
nor examined; my PC, along with a corporate resolution with the company, is for
William Russell to be hired on as a Manager, as mentioned in the Corporation Minute
Book of DR. WILLIAM RUSSELL NATUROPATHIC INC. In my response letter dated
February 26th 2014 to the proposal letter from the auditor, Janny Ng dated January 28,
2014, it was stated:

“ You never saw the documentary evidence such as the bills (which also state that the
taxpayer, while as Manager, declined to be a source) or the Agreement before sending
the proposal. The authorized representative has made these bills available to you. Copies
of the bills and the Agreement are available upon request. “

The Auditor’s Report says that the principle file was a project file of Paradigm Project so
CRA should be familiar with the this Private Contract. Therefore, it is unusual that the
auditor states on page 6 of the report:

“Since the taxpayer did not provide any further clarification or additional supporting
documents for the unreported revenue, no adjustments will be made to the proposed
amounts. “

Again in my letter dated February, 26, 2014 to Janny Ng it is stated:

“Copies of the bills and the Agreement are available upon request”.

There was no written request response from the Auditor asking for the Agreement (PC),
a major supporting document. I find that very odd; can you explain to me why she
would not have asked for such an important supporting document?

In my copy of the letter dated February 26th, 2014 from Sandra Gibbs (copy attached)
sent to the auditor, Janny Ng ; Sandra Gibbs states:

“ I note that your audit letter indicates that you had made several queries to uncover the
supporting documents for the shareholder loan amounts. I have no copy of such a
request in my office. I do apologize for the lack of response to phone call, but we were
expecting that such queries would be sent by letter for clarification.

I will be responding to your Schedules III and IV only. Dr. Russell will be directly
responding to Schedules I & II. “ (see attached letter)

Janny Ng mention several times in her Report that she tried numerous times to reach
Sandra Gibbs, why did she not communicate in writing as this form of communication
had been established for clarification? In Ms. Gibb’s letter of February 26, 2014 she
states: “ If you are looking for a letter from Manulife confirming these insurance
amounts, or a copy of the policy, please advise. If the support you need is other than this,
please advise and we will do our best to further support these expense claims.”

As Sandra Gibbs stated that Dr. Russell will be directly responding to the Schedules I and
II, why did Janny Ng not contact William Russell after his letter dated February 26, 2014
which indicated supporting documentation upon request regarding the “unreported
income” in Schedule I & II?

In regards to Schedules I & II, by filling an office with Her Majesty and creating a
corporation sole, the individual has two capacities: 1) as an officer for Her Majesty’s
office and 2) as a private person earning private property through his Private Contract
(“PC”) as Manager of DR.WILLIAM RUSSELL NATUROPATHIC INC. (Corp). This dual
capacity allows the Income Tax Act (“ITA”) to legally have jurisdiction over both persons,
legally tax individuals who consent to be such officers, respect Canada’s common law
principles to private property, and comply with its international human rights
covenants. As the ITA must protect property rights, the ITA can only deem and not
mandate an individual’s income to be for Her Majesty’s office as public property, which
must be reported accurately and on time, as to do so is a breach of trust by a public
officer. If the deeming is rebutted (as I have with the PC, which must be allowed since
the ITA protects private property rights) then the private persons income while not as
an officer is ITA “exempt income” which ITA s.3(f) deems equal to zero.

248(1) “exempt income” means property received or acquired by a person in such
circumstances that it is, because of any provision of PART I, not included in computing
the person’s income, but does not include a dividend on a share or a support amount
as defined in subsection 56.1(4); (see Why Unreported Income doc.; s. Private Property
Could be ITA, “exempt Income)

There is no line on a T1 to file any private property “exempt income” because a T1 uses
the all-lower-case ‘social insurance number’ to indicate that it is only filling the public
property of Her Majesty’s office (in contrast to the upper and lower case Social
Insurance Number that indicates one as ITA “legal representative”). The omission of this
line, and the ITA s.3(f) deeming such “exempt income” to equal zero both prevent
private property from being illegally or mistakenly converted to public property on a T1.
I am proposing that not reporting on a T1 any public property made for Her Majesty’s
office could be tax evasion, but not reporting on a T1 the ITA “exempt income” of a
private person’s private property is not tax evasion.

My position is that while I worked in the capacity of “Manager” under the PC, I declined
the ITA’s deeming to become a source as an officer identified with a social insurance
number (see document; Why Unreported Income…. Section 30, ITA: Deeming As Officer
Must Be Rebuttable) and received money that became ITA “exempt income”, so I filed
all income made as an officer (i.e. director’s fees) and did not file any “exempt income”
because that amount, while subject to the ITA, is exempt from tax. The only
“unreported income” for the individual as Manager, as the Auditor proposed, is only
unreported “exempt income”. There are no grounds for the proposed “Unreported
Business Income (made as such an officer) nor for any gross negligence penalties.

The PC states, in Section B.1, that the work under it is NOT as an ITA “shareholder”,
which is an ITA/CPP/ETA “officer”, as such an officer earns profit for Her Majesty’s
“office”. It is a legal impossibility under the PC to have allegedly made or received any
shareholder loans or shareholder benefits. The PC states that the work under it is done
NOT as an ITA/CPP/ETA “officer” for Her Majesty, whether as an “employee” or
“director” (Section B.1) performing “employment “ or duties of an “office’.

The PC states that the individual performs day to day managerial duties, other than
shareholder, director, or any other position as an officer of Her Majesty’s “office” and
that the compensation for the work under it is to be private property and so is NOT the
public property of Her Majesty.

The CRA auditor made the assumption that William Russell was paid as being employed
as holding an “office” but in those duties of holding an “ office “ they were ONLY as a
Director of the Corporation.

Under Schedule II, Unreported Business Income, the amounts in question for the year
2010, 2011, and 2012 were made by a private person of full capacity, i.e. not in the
position of such an officer as stated in the PC and hence not in a position under the PC
to receive profit either as a servant (self-employed) as an officer, as an employee as an
officer, business income as an officer, property for profit as an officer (i.e. shareholder),
nor holding an office for profit.

The individual’s work was not as a CPP officer or ITA officer and therefore was not in a
position to receive profit and nor to receive income from any source as an officer
identified with a social insurance number. Since I declined the ITA’s deeming to be a
source as an officer identified with a ‘social insurance number’ while as Manager, I
received ITA “exempt income” instead of taxable or non-taxable
Income (both terms are related to such an officer).

The Auditor in her report stated: “ Generally, 4 or 5 cheques were written per month to
William Russell in rounded amounts ranging from $ to $ , usually $ to
. William Russell would deposit the cheques to his personal bank account with
either or Bank . “

I did some work, including as Director for DR. WILLIAM RUSSELL NATUROPATHIC INC, in
2010 -2012 as an ITA /Canada Pension Plan Act (CPP) /Excise Tax Act (ETA) “officer” for
the ITA/CPP/ETA “ office” of Her Majesty, with both such “officer” and “office”
identified with the same 9 digits, but identified as the social insurance number styled in
all lower case (also SIN). These Director’s fees have already been reported on T1 for
taxation years 2010, 2011 & 2012 as well as any income from any other source as such
an officer. I also did other work in 2010-2012 under the PC as previously stated.

The Corporation made cheques out for Director’s fees to WILLIAM RUSSELL, as an
“officer” which were public property of Her Majesty and deposited at .
The Corporation also made out cheques to William Russell as a private person under the
PC, which were deposited in the taxpayer’s private bank account at the
. The amounts $ , $ and $ referenced in Schedules I & II
of the Auditor’s Report of “unreported business income” for the years 2010, 2011 &
2012 are my private property, as ITA “exempt income”, and never was Her Majesty’s
public property.

A SIN on file at any financial institution could be an indication of either holding deposits
for the taxpayer as a private person not as an officer (Social Insurance Number) or for
the taxpayer an officer of Her Majesty’s office (social insurance number) since CRA uses
the acronym “SIN “ to denote both. Due to my declaration above, CRA has no evidence
that these amounts deposited at are public property of Her
Majesty’s office.

The Auditor has assumed that my household is solely supported by income as an officer
of Her Majesty’s office. In fact, my household is mainly support by my ITA “exempt
income” while not as such an officer earned under the PC.

As the PC was signed to decline the ITA’s deeming to work as an officer for Her
Majesty’s office, I have a superior claim to my private property and therefore could not
commit a public property offence such as tax evasion because the PC is written evidence
that I never consented my private property to become public property. As a
consequence, there cannot be any fraud either as the public (aka Her Majesty) was
never a party (see attached document, “ Why Unreported Income….”, Section 39,
Superior Title Claim : Never Became Public Property )

Sincerely,

William Russell

As ITA “legal representative “ with Social Insurance Number

CC: Letter from Sandra Gibbs to Ms. Janny Ng dated February 26, 2014
CC: Letter from William Russell to Ms. Janny Ng dated February 26, 2014
CC: Insurance Policy statement, Manulife
CC: Document: Why Unreported Income Not on a T1 is Not Always Tax Evasion

10

11

Why Unreported ‘Income’ Not on a T1 is Not Always Tax Evasion
Table of Contents
1 SUMMARY 14
2 ESSENTIAL ELEMENTS OF TAX EVASION: CROWN’S PERSPECTIVE 15
3 ESSENTIAL ELEMENTS OF TAX EVASION: A FRAUD AGAINST PUBLIC PROPERTY 15
4 ESSENTIAL ELEMENTS OF TAX EVASION/FRAUD: THE FIRST TWO MISSING ELEMENTS 17
5 PUBLIC OFFICER DEALING WITH PUBLIC PROPERTY IS ALSO AGENT OF HER MAJESTY 18
6 OFFICER: HAS LEGAL POWERS ABSENT FROM PRIVATE PERSON 20
7 CORPORATIONS: AGGREGATE OR SOLE 21
8 CORPORATION SOLE: BY FILLING AN OFFICE 22
9 IDENTIFYING HER MAJESTY’S OFFICE FOR INCOME TAX 22
10 CREATING HER MAJESTY’S OFFICE 31
11 SOLE OFFICE WITH HER MAJESTY 33
12 OFFICE: A POSITION TO RECEIVE ‘INCOME’ AS “OFFICE PROFIT” 34
13 ‘SOURCES’ OF ‘INCOME’: DEEMED TO BE “OFFICE PROFIT” FOR HER MAJESTY’S OFFICE 36
14 OFFICE/OFFICER: CONCEPTUALLY DIVISIBLE BUT LEGALLY INDIVISIBLE 37
15 OFFICER: HAS POWER TO CONVERT ‘INCOME’ INTO “OFFICE PROFIT” 37
16 QUALITY OF ‘INCOME’ 38
17 OFFICE/OFFICER’S LEGAL INDIVISIBILITY: LEGAL BASIS FOR WORLDWIDE TAXATION? 38
18 OFFICE/OFFICER: ALSO DETERMINES CPP, GST, EI 39
19 OFFICE/OFFICER: CPP MANDATORY 39
20 OFFICE/OFFICER: DETERMINES GST 40
21 OFFICE/OFFICER: DETERMINES EMPLOYMENT INSURANCE 40
22 EI ACT: RECOGNIZES EMPLOYMENT NOT AS AN OFFICER 41
23 ITA: INDIVIDUAL DEEMED TO HAVE DUAL CAPACITY 42
24 ITA: JURISDICTION OVER BOTH INDIVIDUAL CAPACITIES 43
25 DUAL CAPACITY: WHY PARTNERSHIPS ARE NOT AN ITA “PERSON”? 43
26 PROPERTY RIGHTS BETWEEN PERSONS 44
27 PRIVATE PROPERTY COULD BE ITA “EXEMPT INCOME” 44
28 ITA: PROTECTING PRIVATE PROPERTY = HONOURING HER MAJESTY 45
29 ITA: LEGALLY CONVERTS PRIVATE PROPERTY TO PUBLIC PROPERTY 46
30 ITA: DEEMING AS OFFICER MUST BE REBUTTABLE 46
31 SUPERIOR TITLE: THE THIRD MISSING ESSENTIAL ELEMENT 48
32 FIDUCIARY DUTY TO REPORT ALL INCOME 49
33 T1: FOR FILING ONLY HER MAJESTY’S PUBLIC PROPERTY 50
34 FILING PRIVATE PROPERTY BY LETTER? 50
35 TAX EVASION: A BREACH OF FIDUCIARY DUTY TO REPORT ALL PUBLIC PROPERTY 51
36 REMEDIES IN EQUITY FOR BREACH OF FIDUCIARY DUTY 51
37 NO BREACH OF FIDUCIARY DUTY 52
38 PRIVATE PROPERTY TITLE CLAIM AND AGREEMENT 52
39 SUPERIOR TITLE CLAIM: NEVER BECAME PUBLIC PROPERTY 53
40 PRIVATE PROPERTY CLAIM: LAWFUL TAX AVOIDANCE 53
41 NO TAX EVASION: NO ACTUS REA 54
42 NO TAX EVASION: MENS REA IRRELEVANT 54
43 WHY LACK OF FULL DISCLOSURE FOR AGENTS OF HER MAJESTY? 54
44 DUAL CAPACITY: THE REASON FOR FABRICATION OF EVIDENCE? 56
45 COMPARE TO CRA ALERT ON TAX PROTESTORS: THEORY VALIDATED? 57
46 CONCLUSIONS 59
12

List of Forms and Diagrams

1 - Diagram: Persons in Law
2 - CRA Web Site: Definition of the upper-and-lower case “Social Insurance Number”
3 - CRA Web Site: Definition of the all-lower-case “social insurance number”
4 - Diagram: History of the T1 GENERAL
5 - Revenue Canada Form: T1A for 1941
6 - Revenue Canada Form: T1 GENERAL for 1990
7 - Revenue Canada Form: T1 GENERAL for 1991
8 - CRA Form: T1 GENERAL for 2000
11 – CRA Web Site: PDF of CRA’s definition of upper-and-lower case “Social Insurance Number”
12 - CRA: Uses of ‘social insurance number’ Signifying Capacity as “Beneficiary”/”Officer”
13 - CRA: Uses of Social Insurance Number Signifying Capacity as “Legal Representative”
14 - Service Canada Form NAS-2120: SOCIAL INSURANCE NUMBER APPLICATION
15 - CRA Form: CPT1 Request for Ruling of Status of Worker under CPP and/or The EI Act
16 - CRA Form: CPT100 Appeal of a Ruling under the CPP and/or EI Act
17 - CRA Letter: Due Diligence - Unauthorized Use of Taxpayer Information by Third Parties
18 - 1-2 ELIZABETH II Chapter 40: An Act to Amend the Income Tax Act, May 14 1953
19 - Diagram: Person Deemed as Officer for Canada’s Income Tax Act
20 - Diagram: Individual with “Employment” Source Determines CPP, EI, and GST
21 - Diagram: Individual with “Office” Source Determines CPP, EI, and GST
22 - Diagram: “Office” = “Employment” Still Determines CPP, EI, GST
23 - Diagram: Summary: Individual as “Officer” Determines CPP, EI, and GST
24 - Diagram: Superior (Higher) Property Title
25 - Diagram: ITA Fiduciary Duty: Due to Agency
26 - Diagram: Public Property versus Private Property in Canada
27 - Diagram: ITA Liability: Due to Debt
28 - CRA Newsroom Alert: Don’t buy into illegal tax protestor schemes
29 - CRA News Release: The CRA takes action against tax protest movement (UNRELEASED)
30 - Diagram: Crown Agent’s Position on the Income Tax Act
31 - Diagram: This Theory’s Conclusions on the Income Tax Act
32 - CRA Tax Alert: Abuse of source deductions and GST/HST amounts held in trust
13

1 Summary
Is not reporting all income on a T1 tax evasion? I propose the answer is, “Not always.”
Over the last ten years or so, Canadian courts have been full with people who claim that
they do not have to pay income tax. There are so many different theories that the
Associate Chief Justice of Alberta wrote about this ‘movement’ in an 135-page obiter in
the divorce case Meads v. Meads1, calling such persons “Organized Pseudolegal
Commercial Argument [“OPCA”] Litigants”. Some argue the Income Tax Act (“ITA”) is
unconstitutional,2 as they3 believe it to be a direct4 tax. Another theory is that due to
common law’s human right to private property5, a natural person is not included6 in the
definition of “person” in the ITA and so is an ITA “exempt person” (the courts ruled both
positions to be incorrect). Yet another theory is the ITA taxes an entity that the natural or
private person represents; however, in the Stanchfield7 case, the individual plaintiff failed
to show how to create a second entity in a fashion recognized by law, so such an
individual was ruled to be indivisible. In a nutshell, Crown’s position is that as the individual
is indivisible and not an ITA “exempt person”, all ‘income’8 by such an indivisible individual
is subject to, and taxable, by the ITA as ‘profit’.
In this theory paper, I propose that the ITA is legal via an individual representing a second
entity by forming a corporation sole as an officer of Her Majesty’s office. As the ITA taxes
‘profit’ from ‘income’, and income for any office is profit, such “office profit9” is taxable. A
private person, being distinct from any officer, lacks the legal power to convert income into
or to receive it as “office profit”, instead receives private property as ITA “exempt income”
which is not taxed. This dual capacity allows the ITA to tax individuals as officers while also
protecting private property rights in compliance with Canada’s common law principles and
international human rights covenants. It also makes individual income tax an indirect
federal tax and therefore constitutional, as it is a tax on the “office profit” of Her Majesty’s
federal office that the federal officer represents, and not a tax on the income of a private
person of full capacity (not as an officer).

1
Meads v. Meads, 2012 ABQB 571, Pages 15-150
2
See, for example, R. v. Klundert, 2004 CanLII 21268 (ON CA), http://canlii.ca/t/1hqhg, and subsequent
appeals still ongoing ten years later.
3
Most tax lawyers believe individual income tax is a direct tax; see, for example, lawyer Paul McKeever’s
web site: http://www.ownlife.com/tax/
4 See, for example, Kasvand v. The Queen, 94 DTC 6271; appeal refused, 95 DTC 5618
5
Libertarians take this position. See, for example, Robert Nozick, Anarchy, State and Utopia (New York:
Basic Books, 1974), where Nozick says: the taxation of labour income “is on a par with forced labor”—
resulting in the “(partial) ownership by others of people and their actions and labor” (page 169), and David
Duff, University of British Columbia (UBC), Faculty of Law, Private Property and Tax Policy in a
Libertarian World: A Critical Review, http://papers.ssrn.com/sol3/papers.cfm?abstract_id=719742
6
Kennedy v. Canada (Customs & Revenue Agency), 2000 CanLII 22837 (ON SC), http://canlii.ca/t/1wd1t
Canada (National Revenue) v. Stanchfield, 2009 FC 99 (CanLII), http://canlii.ca/t/22g7x
7
8
There is no definition of ‘income’ or ‘profit’ in the Income Tax Act. For more see the Appendix.
9
See my definition of the phrase “office profit” in the Appendix.
14

NOTE
Russell’s Notice of Objection to CRA, at Tab C, included Apu’s Theory,

Part 1. The first three pages here are the Table of Contents (page 12),
the List of Forms and Diagrams (page 13), and the Summary (page 14).
However, to save paper, we have omitted attaching the rest of Apu’s

Theory, Part 1. You can download the rest, and print it out, from SSRN
(Social Sciences Research Network). It is the world’s largest on-line
research paper repository:
https://ssrn.com/abstract=2800623
or
http://dx.doi.org/10.2139/ssrn.2800623

Tab D
CRA’s Notice of
Confirmation
to
Russell

Canada Revenue Agence du revenu
Agency du Canada
REGISTERED Our file Notre reference

GB 3572
Account Number - Numero cle compte

xxx xxx
WILLIAM RUSSELL
AVE
SURREY. BC V4A
NOTICE OF CONFIRMATION
This notice refers to your Notice of Objection dated January 30. 2015 to the Income Tax
assessment for the years 2010. 2011. 2012.
Having carefully reconsidered the assessment with reference to the information and
reasons set forth in vour Notice of Objection, the Minister of National Revenue lendeis
the following decision:
Your objection is disallowed and the assessments are confirmed.
The basis of your objection is that you were incorrectly assessed unreported income and
gross negligence penalties for the taxation years under dispute.
A review of the facts and documents submitted indicates that your representations have
not been substantiated writh vouchers, receipts and accounting records and the amounts
initially reported on the respective T1 return do not evidence that the income has been
double-assessed. The unreported income has. therefore, been reassessed pursuant to
subsection 9(1) of the Income Tax act and the gross negligence penalties are being
confirmed pursuant to subsection 163(2) of the Income Tax Act. The GST credit
entitlement has been simultaneously confirmed pursuant to paragraph 122.5(l)(b) and
subsection 152(1) of the Income Tax Act.
Section 169 of the Income Tax Act provides that if you disagree with the decision, you
mav appeal to the Tax Court of Canada within 90 days from the date that the Notice of
Confirmation is sent to you. Information on how to file an appeal is enclosed. Should
you have any questions, please call Neeta Khushalani at (604) 691o627.
Dated at the city of Vancouver, this £rp 2 5 20Vu
Christopher Fleming, CA
Team Leader
Appeals Division
Encl: Form RC4443-2, Appealing Income Tax Assessments to the Tax Court of Canada
Appeals Division, WP04
c/o 9755 King George Boulevard
Surrey, BC V3T 5E1
Page 1 of 1

Tab E
Russell’s Notice of
Objection
to
Tax Court of
Canada

SY HAND / PORTlU^
RECEIVED - REQU
TAX COURT OF CANADA

MAR 0 2 2016
BETWEEN TAX COURT OF CANADA
COUR CANADIENNE DE L'IMPOT
VANCOUVER. CANADA
William Russell
Appellant
and
HER MAJESTY THE QUEEN

Respondent
NOTICE OF APPEAL
(Amended February 22, 2016)
A. Appellant's Address: Avenue

Surrey, BC
V4A
B. Assessment Under Appeal:
The assessment under appeal was made by a Notice of Reassessment dated May 23,
2014, under the Income Tax Act of Canada (the "ITA"), with respect to the
Appellant's 2010, 2011, and 2012 taxation years.
C. Material Facts Relied Upon
ITA "Employed" and ITA "Employment" Income(s) Reported on Tls
1. At all material times, the Appellant was an individual, shareholder and director of
DR.WILLIAM RUSSELL NATUROPATHIC INC. (hereinafter "the Company").
2. The Company is a corporation incorporated in 2003 under the laws of the province
of British Columbia, and carries on the business of providing health care services.
3. At all material times, the Appellant's duties as director of the Company included:
making decisions for the best interests of the Company, attending Board meetings,
appointing and removing corporate officers, signing corporate resolutions,
authorizing major corporate policy decisions, overseeing employees and contract
negotiations (including, but not limited to, private contracts). These duties are
outlined in Schedule A to a Resolution dated August 16, 2005, and is attached as
Appendix A.
https://CanadaIncomeTaxIsLegal.is 1
ITA "Employed" Source of Income from a Business
4. In the taxation years under review, the Appellant received income from business
under a contract, dated, March 6, 2006 between the Appellant and Energetic Matrix
Church of Consciousness (EMC) for services provided by the Appellant as an
Independent Facilitator.
5. The amounts received were reported by the Appellant as income from a business
source on the Appellant's T1 returns for the respective years.
ITA "Employment" Source of Income from an Office
6. In the taxation years under review, the Appellant, as director of the Company,
received the amounts as Director's salary.
7. The amounts received were reported by the Appellant as income from an

employment source on the Appellant's T1 returns for the respective years.
Income Under Private Contract Reported by Letter
8. At all material times, the Appellant performed duties as Manager of the Company,
including supervising the workers at the Semiahmoo Wellness Center, attending
office and management meetings, writing performance reviews for workers under
his supervision, attending to and performing treatments for patients of the clinic,
supervising the daily operations of the clinic as outlined in a Private Contract
("PC"). A copy of that PC is attached as Appendix B.
9. The PC was signed by the Appellant as an individual and also by the Appellant in
his capacity as director of the Company.
10. Throughout the taxation years under review, the Appellant invoiced the Company
for work he performed as Manager under the PC. A sample copy of such an invoice
is attached as Appendix C.
11. In the taxation years under review the Appellant invoiced the Company for the work
he carried out under the PC and the Company paid the following amounts to the
Appellant:
2010 -$ 000
2011 $ 000
2012 $ 000
12. The Appellant reported these amounts to Canada Revenue Agency ("CRA") by
letter dated February 26, 2014. In that letter the Appellant noted his SIN as a Social
Insurance Number styled in upper and lower case letters. A copy of the letter is
attached as Appendix D.
13. The Appellant also explained in that letter why it is legally impossible to report his
income made under the PC on a T1 return that uses the SIN as a "social insurance
number' styled all in lower case letters.
14. The Appellant did not seek to deduct or claim any expenses (such as vehicle
expenses or home office use) or benefits (such as CPP or GST) from the income he
earned under the PC.
Income Earned Under Private Contract Reassessed as if Made by CPP/ITA Officer
15. During the audit of the Appellant's 20102012 taxation years, the Minister of
National Revenue ("the Minister") proposed that the Appellant convert the income
the Appellant earned under the PC, his private property, into Her Majesty's "public
money" within the meaning of s.2 of the Financial Administration Act ("FAA). and
require the Appellant to make CPP contributions and GST remittances.
16. During the audit of the Appellant's 20102012 taxation years, the Minister also
proposed that the Appellant convert the income the Appellant earned under the PC
into profit of an office, which would be taxable as income from business under the
ITA.
17. In a letter dated February 26, 2014, the Appellant responded to the Minister's audit
proposal by affirming that he wished the income he earned under the PC to remain
his private property, and that he does not consent to converting such income into
Her Majesty's "public money" within the meaning of s.2 of the FAA for the
Consolidated Revenue Fund ("CRF"). Fie also made it clear that he does not want
that income to be converted into profit for an office. That letter dated February 26.
2014 is attached as Appendix D.
18. Despite the Appellant's request the Minister reassessed the Appellant's income
earned under the PC as if were the FAA s.2 "public money' for the CRF, and as if it
were profit of the office, and so advised the Appellant in the Notice of Reassessment
dated May 23, 2014.
19. The Appellant objected to the Minister's reassessment and filed a Notice of
Objection on August 1, 2014.
20. At the objection stage, the Appeals Officer proposed that the Appellant convert the
income he earned under the PC (his private property) into Her Majesty's FAA s.2
"public money" for the CRF.
21. By letter dated March 30, 2015, the Appeals Officer also advised the Appellant that
it was proposed that the Appellant convert income he earned under the PC into
profit of an office, which would be taxable as business income under the ITA.
22. In a letter dated April 27, 2015, the Appellant responded to the proposal by the
Minister by reaffirming his earlier request that the income he made under the PC
remain private property, and that he did not wish to convert such income into FAA
s.2 "public money" for the CRF; nor does he wish to convert the income he received
under the PC into profit of an office.
23. The Minister confirmed his reassessment of the Appellant's 20102012

taxation years taking the position that the income earned by the Appellant
under the PC, is to be treated as if it were FAA s.2 "public money" for the CRF, and
as if it were profit of an office.
24. The Minister also reassessed the Appellant by including in the calculation of the
Appellant's total taxable for those years the income the Appellant earned under the
PC as if it were profit for an "office".
25. The Minister further reassessed the Appellant by assessing CPP contributions on the
income earned by the Appellant under the PC.
26. The Minister further reassessed the Appellant by assessing GST on the income
earned by the Appellant under the PC.
D. Issues To Be Decided
27. Issue #1: Whether the Minister erred in reassessing the Appellant's income for the
20102012 taxation years by assessing CPP contributions payable as if these were in
relation to the income he earned under the PC.
28. Issue #2: Whether the Minister erred in reassessing the 20102012 taxation years
by including in the calculation of the Appellant's taxable income for those years, the
income he earned under his PC.
Subissue
29. Whether the income gained by the Appellant under his PC with the Company was
received by him in his capacity as an "officer" within the meaning of s.2(l) of the
CPP and s.248(1) of the ITA.
30. Issue #3: Whether the Minister erred in reassessing the Appellant's Goods and
Services Tax Credit (GSTC) and British Columbia Climate Action Tax Credit
(BCCATC) for base years 20102012 years and British Columbia Harmonized Sales
Tax Credit (BCHSTC) for base years 2010 and 2011.
Subissue
31. Whether the income made by the Appellant under his PC was received by him in his
capacity as an "officer" within the meaning of s.123(1) of the ETA (GST).
32. Issue #4: Whether the Minister erred in reassessing the Appellant's income for the
20102012 taxation years by assessing the Appellant to penalties under s.l63(2) of
the ITA.
Subissue
33. Whether the term "Social Insurance Number", referred to in s. 237(1) of the ITA and
styled in both upper and lower case letters, is to be distinguished from the term
"social insurance number", styled in lower case letters only and referred to in CRA
forms Tl, T2125, TD1, T4, T5018, TlDD, T2 Schedule 50, CPT100. Specifically,
whether a Social Insurance Number is assigned exclusively to an individual who is a
"legal representative" within the meaning of s. 248(1) of the ITA, and a "social
insurance number" is assigned exclusively to an individual who is an "officer'
within the meaning of s.2(l) of the CPP, s.123(1) of the £X4(GST), s. 248(1) of the
ITA.
E. Statutory Provisions Relied Upon
An Act to Amend the 1952 Income Tax Act, 1-2 Elizabeth II, Chapter 40
34. The Appellant relies on An Act to amend The Income Tax Act, assented on May 14,
1953 to show the addition to the ITA of the definitions of "employee" and
"employer" by that amendment.
Canada Pension Plan Act, RSC 1985, c.C-8
The Appellant relies on the following sections of the CPP:
35. CPP s. 2(1) for the definition of "employment", "office", and "pensionable
employment".
36. CPP s.98102 on the requirement to have a SIN as a Social Insurance Number
styled in upper and lower case, but does not define a social insurance number.
Canada Pension Plan (Social Insurance Number) Regulations, CRC, c.386
37. The Appellant relies on the CPP (Social Insurance Number) Regulations. s.3(l) and
s.3(4) to show the need for application for a Social Insurance Number if an
individual is required by the Act to file an application, or if an individual expects to
be an individual required by the Act to file an application.
Criminal Code, R.S.C., 1985, c. C-46
38. The Appellant relies on the Criminal Code, s.322(l) to show that theft by tort of
conversion is an offence under the Criminal Code.
Employment Insurance Act, S.C. 1996, c.23
The Appellant relies on the following sections of the EI Act:
39. EI Act s.2(l) for the definitions of "employer" and "employment" within that Act,
and 5(4)(g) for defining "insurable employment" in relation to that office in the
Income Tax Act.
40. El Act s.138140 on the requirement to have a SIN as a Social Insurance Number
style in upper and lower case but lacks a definition for the social insurance number.
Excise Tax Act (GST), RSC 1985 c. E-15
41. The Appellant relies on the ETA, Part IX (GST) s.123(1) for the definition of
"office" and "officer" as having the same meanings assigned by s.248(l) of the ITA.
Financial Administration Act, RSC 1985, c. F-ll
The Appellant relies on the following sections of the FAA:
42. FAA s.2 for definitions of "Consolidated Revenue Fund", "money", "negotiable
instruments" and "public money".
43. FAA s.17(1) for the relationship between "public money" and the Receiver General.
44. FAA s.19.1 for Her Majesty's right to charge for privileges for a class of persons.
45. FAA s.82 for stating that all books and documents kept or used by an officer or
person collecting revenue for Her Majesty is the property of Her Majesty, and that
such revenue received shall be deemed to be belonging to Her Majesty.
Income Tax Act, RSC 1985 c.l, (5th Supp.)
The Appellant relies on the following sections of the Income Tax Act:
46. ITA s.2(2) for the definition of taxable income.
47. ITA s.3 to show that income made not as an officer is deemed to be equal to zero.
48. ITA s.6(3) to show that sources of income from employment or office are deemed to
be "rendered as an officer" unless it is established otherwise.
49. ITA s.9(l) to show that a taxpayer's income from business or property is the profit.
50. ITA s.l8(l)(c)to show that expenses cannot be deducted from income if the
taxpayer is "producing exempt income or is in connection with propertyfrom which
would be exempt".
51. ITA s.117(2) to show that the tax payable is on the taxable income defined in ITA
s.2(2).
52. ITA s.129(4) to show the definitions of income here only applies to private
corporations and not to individual taxpayers.
53. ITA s.150(1) to show that CRA forms Tl or T2125 are not statutorily authorized by
the Minister to file returns of income.
54. ITA s.152(8) to show that an assessment by the Minister is deemed to be valid and
binding subject to objection and appeal.
55. ITA s. 159(1) to show that an ITA "legal representative" is jointly and severally liable
for the debts of the taxpayer.
56. ITA s.222 to show that all taxes, interest, penalties are payable to Her Majesty.
57. ITA s.224.1 to help show that the CPP/EI/ETA/ITA officer deals with only one
office of Her Majesty, as this then allows her the right of setof;
58. ITA s.237(1) for the requirement of obtaining a SIN as a Social Insurance Number
styled in upper and lower case from Canada Employment Insurance Commission,
but not the SIN as a social insurance number as used by CRA on Forms Tl, TDl,
T2125, T4, T5018, and T2 Schedule 50 that is styled instead all in lower case, for
filing a return of income.
59. ITA s.248(l) for the definition of "business", "corporation", "employed",

"employee", "employer", "employment", "exempt income", "individual", "legal
representative", "office", "officer", "property" and "taxpayer".
60. and the entire Income Tax Act for not having any definitions for 'income' (other
than in s.129(4) for private corporations), 'nontaxable income', 'profit', 'resident',
'social insurance number' styled all in lower case , and 'source'.
F. Case Law and Other Materials Relied Upon
Case Law
The Appellant relies on the following case law:
61. Amegard v. Board of Trustees of Barons Consolidated School District, Alberta,
1917. 2 WWR 306, for the Court's statement that a corporation sole can be
somebody other than "a King or a Bishop".
62. The Queen v. The Canadian Broadcasting Corporation, [1957] O.J. No.655, for
that Court's statement that " When Parliament names Her Majesty in a. statute it
means Her Majesty, not in her capacity as a natural person but in her capacity as a
corporation sole ".
63. Mr. C v. Minister of National Revenue, 50 DTC 206, for the Court's statement that
a payment to the holder of an office is a profit for that office if it accrues to the
holder in virtue of his office.
64. The Queen v. Hart Electronics Limited, 59 DTC 1192, for the Court's opinion that
"a T2form, which gave certain sent by letter... constituted an income tax return.'
65. Gibbs v. Regina, 2006 BCSC 481 (CanLII), for the Crown's admission "that there
was no regulation prescribing the Tl form and that there was no documentation
whereby the Minister expressly authorized the form. "
66. Goldman v. Minister of National Revenue, [1953} 1 S.C.R. 211, for the Court s
agreement that income received for any office is profit for that office.
67. Johnston v. MNR [1948] SCR 486, for the Court's statement that "every suchfact
found or assumed by the assessor or the Minister must be accepted as it was dealt
with by these persons unless questioned by the appellant. "
68. R. v. Porisky and Gould, 2012 BCSC 67, at [46] for the Court's statement that "(the
law) has recognized a corporation sole which applies to an office, such as a
bishop."
69. Her Majesty The Queen v. Redpath Industries Ltd. and Dominion Sugar
Company Ltd. 84 DTC 6349, for the Court's statement that "once total income is
declared... the necessary element for an offence of omission to declare is not
present to support a charge of that nature.'''
70. Reference re: The Employment and Social Insurance Act, [1936] SCR 427, for
the Court's statement that private employment contracts are outside the jurisdiction
of the federal government as they are within the jurisdiction of the provinces.
Government of Canada Publications
The Appellant relies on the following Government of Canada publications:
71. Industry Canada's website definition of how a corporation sole can be formed.
72. Discover Canada, Citizenship and Immigration of Canada (2009), Ottawa, Queen's
Printer for Canada, to show that Her Majesty is the legal personification of all
Canadians.
73. Notes on Proposed Amendments to the Income Tax Act, Proposed section 3.1,
Department of Finance Canada, published October 31, 2003, to show that once an
individual accepts being an officer that deals with the CRF, it asymmetrically
determines that it is not up to such an officer "to prove the unreasonableness of
their profit expectations.
74. Form NAS-2120 from Services Canada, which creates the Social Insurance Number
styled in upper and lower case, and which is also referred to by the acronym SIN,
and for that form's statement, "participation is voluntary".
CRA Forms
75. Tl for years 1941 and 1990 to show that for filing years from 1941 to 1990, Tl
forms were authorized by the Minister.
76. Tl for years 1990 and 1991 to show that starting in 1991 Tl forms were no longer
forms authorized by the Minister, and switched from using SIN as a Social
Insurance Number styled in upper and lower case in the 1990 Tl to the social
insurance number styled all in lower case in the 1991 Tl.
77. Tl for the years 2000 and 2001 to show that starting from 2001 Tl forms use the
acronym SIN to also denote the social insurance number styled all in lower case.
78. Tl for years 2010, 2011, 2012, and 2013 to show that those Tl forms still use the
social insurance number styled all in lower case and the acronym SIN to denote it.
79. CRA forms CPT100, T2125, T2091, T5018, T2 Schedule 50, T2154, TDl, Tl-
ADJ, and Tl-DD to show the use of the social insurance number styled all in lower
case on those forms.
80. CRA forms CPT1, ISP3000, INS3166, RC199, T1013, T1162, T2029, T1287,
NR5 to show the use of the Social Insurance Number styled in upper lower case on
those forms.
CRA Publications
The Appellant relies on:
81. CRA Policy Statement, "P182R GST/HST Policy Statement on Agency", to show
the characteristics of a principleagency relationship according to CRA.
82. CRA Tax Alert, "Abuse of source deductions and GST/HST amounts held in trust"
to show that if CPP, EI, income tax source deductions and GST amounts are all held
in trust for Her Majesty for the CRF, such an officer deals with a sole office that
deal with the CRF.
83. CRA Alert on their website, "Don't buy into illegal tax protestor schemes" to show
the Minister's position that it is incorrect for an individual to "treat themselves as
two separate people " for income tax purposes.
84. 2012 CRA Audit Manual, page 87 (or page 948/2058), to show auditors are told that
a 'source', which is not defined in the ITA, is "taxable and. non-taxable income".
85. CRA News Release dated November 26, 2015, "Victoria Paradigm educator
sentenced for tax evasion and fraud" for stating that "/he Paradigm scheme ... to
avoid paving, income tax".
Unpublished CRA News Release
86. The Appellant relies on CRA news release, "The CRA takes action against tax
protest movement", dated September, 2010 (but never released) to show that it could
be correct for individuals to "treat themselves as 1m>o separate persons when they
prepare their tax and benefit returns " and is probably why it was never released.
CRA Website
87. The Appellant relies on the CRA website for their nonstatutory definition of the
SIN as a social insurance number styled all in lower case and also for their non
statutory definition of the SIN as a Social Insurance Number styled in upper and
lower case.
Government of the United Kingdom Publication
88. The Appellant relies on The Execution of Deeds and Documents by or on Behalf of
Bodies Corporate, The Law Commission (United Kingdom), to show that "a
corporation sole has a dual capacity, namely its corporate capacity, and its
individual or natural capacity
Authors Cited
The Appellant relies on the following legal texts:
89. Sir Edward Coke, Institutes of the Lowes of England, where he defines a corporation
sole as "a man who fills an office Coke on Littleton, Co Lit 2a.
90. Sir John Salmond, Jurisprudence 9th Ed. P.424, where he says, "It often happens
that a single human being possesses a double personality. He is one man. but two
persons".
F. Reasons the Appellant Intends to Rely On
With respect to the first issue (assessment CPP contributions), the Appellant states:
91. The Appellant was advised that he needed a SIN to be eligible for benefits such as a
pension under the CPP. As he wanted to be eligible to receive pension benefits in
the future, the Appellant applied for a Social Insurance Number from Canada
Employment Insurance Commission. The current application form.is NAS-2120.
92. The Canada Pension Plan (Social Insurance Number) Regulations, provide as
follows:
3. (1) Every individual who is required by the Actio file an Social

Insurance Number shall do so by...
4. Every individual who expects to be an individual required by the Act to

file an application with the Minister or to apply to the Minister for the
assignment to them of a Social Insurance Number...
93. Having received a Social Insurance Number, when the Appellant became of legal
age he then became liable under ITA s.159(1) within the meaning of s.248(1) of the
ITA "legal representative", because the NAS-2120 SIN application form says the
recipient will be subject to "enforcement of the legislation'. The NAS-2120 form
refers to the Appellant's status of "legal representative" with the "Social Insurance
Number" styled in both upper and lower case letters.
94. Her Majesty is the (legal) personification of all Canadians: Discover Canada.
Citizenship and Immigration Canada (2009), Ottawa, Queen's Printer for Canada.
95. Her Majesty has a dual individual capacity: The Queen v. The Canadian
Broadcasting Corporation, [1957] O.J. No. 655:
35 It is important that at the outset we should understand the connotation of the

words "Her Majesty" in the Act. When Parliament names Her Majesty in a
statute it means Her Majesty, not in her capacity as a natural person but in her
capacity as a corporation sole, a personaficta. In Salmond on Jurisprudence,
9th ed. at p. 444, the author refers to this dual capacity as follows:
He (the King) has a double capacity, being not only a natural person but
a body politic, that is to say, a corporation sole. The visible wearer of the
crown is merely the living representative and agentfor the time being of
this invisible and underlying persona ficta, in whom by our law the
powers and prerogatives of the government of this realm are vested.
36 It is in that capacity that the Queen as sovereign, exercises her executive

powers. The statute that regulates the conduct of persons within Canada, — in the
instant case. The Lord's Day Act, could have no application to natural persons
outside of Canada and therefore would not apply to Her Majesty in her capacity
as a natural person because in that capacity she is outside of Canada. The legal
fiction which recognizes this duality of persons in Her Majesty must also
recognize that in her capacity as a corporation sole Her Majesty at all times is in
every part of her realm. In those parts of her realm in which she is not physically
present she is represented by her constitutional agents.
96. The Law Commission of the Government of the United Kingdom, on The
Execution of Deeds and Documents by or on Behalf of Bodies The Corporate, at
4.25, says,"A corporation sole has a dual capacity, namely its corporate capacity,
and its individual or natural capacity".
97. Since Her Majesty is the legal equivalent of all Canadians, and Her Majesty has a
dual individual capacity, Canadians also can have dual individual capacity.
98. A second capacity of an individual is an officer: R. v. Porisky and Gould, 2012

BCSC 67, at [46]: "(the law) has recognized a corporation sole which applies to an
office, such as a bishop'".
99. A corporation sole however can apply to someone other than a King or a bishop:
Arnegard v. Board of Trustees of the Barons Consolidated School District,
Alberta, 1917, 2 WWR 306.
100. Once an individual forms an office by appointing oneself as an officer. "there is no

distinction between the person who holds the office and the office itself (Industry
Canada's website on corporation sole).
101. As an officer, such an individual has his original capacity as well as his corporate
capacity is then two persons in law, just like Her Majesty and her court officers
such as judges, lawyers, and court sheriffs. A CRA News Release dated September
xx, 2010 states: "tax protestors treat themselves as two separate persons . It was
never released, as "two separate persons" is correct since CRA "tax protestors are
those who "treat themselves as two separate peoplefor income tax purposes"
(CRA website on "tax protestors").
102. The Appellant is not a CRA "tax protestor'" as he believes he is two legal persons
and not "two separate people'' for income tax purposes.
103. To qualify for CPP benefits, an individual must engage in "pensionable

employment" within the meaning of s.2(l) of the CPP, which defines employment:
2(1) "employment" means the state of being employed under an express or

implied contract of service or apprenticeship, and includes the tenure of an
office.
104. The Minister recognizes the Appellant has a second individual capacity as an officer
("the tenure of an office") as the Minister assessed CPP on the Appellant's income
earned under his PC.
105. Canadian tax law is based on selfassessment because only individuals know their
intentions. The Social Insurance Number application states: "Participation is
voluntary". Individuals can use their right of selfassessment to acquire or decline
the benefits of the "office" within the meaning of s.2(l) of the CPP.
106. Although only individuals know their true intentions the Minister has the power to
make assumptions to offset the individual's right to selfassessment (.Johnson v.
MNR [1948] SCR 486). In fact, it is due to the individuals' right to selfassessment
that the Minister has been given the counterbalancing power to make assumptions.
107. The ITA uses a factbased pleading system: Federal Income Tax Litigation in
Canada, Christina Tari, Chapter 6, Section 6.95. In such a system, facts are
assumptions that any party can propose to be agreed to by another party, as shown
by the use of pleabargaining in traffic, tax, and criminal courts.
108. "Deem" is an assumption that the deemer knows to be false but is treated in law as
true. The ITA uses the word "deem" over 3,800 times.
109. Since most Canadians apply for a Social Insurance Number from Canada
Employment Insurance Commission in anticipation of someday receiving CPP
benefits by engaging in "pensionable employment" for an "office" within the
meaning of s.2(l) of the CPP, it is reasonable for the Minister to deem that such
individuals wish to receive the benefits associated with an "office" within the
meaning s.2(l) of the CPP by engaging in "pensionable employment".
110. The Notice of Reassessment where the Minister assessed CPP contributions shows
that the Minister deemed that the Appellant wished to be an "officer" within the
meaning of s. 2(1) of the CPP.
111. The PC states that the Appellant carries out work under the PC not as an "officer"
within the meaning of s.2(l) of the CPP and therefore rebuts the Minister's deeming
that the Appellant wished to be an "officer' within the meaning of s. 2(1) of the
CPP.
112. Consequently, while the Appellant worked under the PC, he lacked the legal
capacity to do any work that would qualify as "'pensionable employment within
the meaning of s.2(l) of the CPP.
113. In summary, the Appellant submits that the Minister erred when reassessing the
Appellant's income for the 20102012 taxation years by assessing CPP
contributions payable as if these were in relation to the income the Appellant earned
under the PC.
Re: Issue 2 (reassessment of private contract income as taxable income):
114. Private contracts for work are outside (ultra vires) the jurisdiction of the federal
government as they are within (intra vires) the jurisdiction of the provinces
(Reference re: The Employment and Social Insurance Act, [1936] SCR 427). As will
be shown below, it is within federal jurisdiction if an individual accepts being
deemed as a federal "officer" and/or accept benefits for such an "office", such as
CPP, and/or the privilege to deduct expenses.
115. The definition of "office" in s.248(l) of the Income Tax Act is nearly identical as the
definition of "office" in s.2(l) of the CPP since:
The Canada Pension Plan definition of "office" is:
s.2(l) "office" means the position of an individual entitling him to a fixed or

ascertainable stipend or remuneration and includes a judicial office, the office
of a minister of the Crown, the office of a lieutenant governor, the office of a
member of the Senate or House of Commons a member of a legislative
assembly or a member of a legislative or executive council and any other
office the incumbent of which is elected by popular vote or is elected or
appointed in a representative capacity, and also includes the position of a
corporate director, and "officer" means a person holding such an office;
The Income Tax Act definition of "office" is:
s.248(1) "office" means the position of an individual entitling him to a fixed

or ascertainable stipend or remuneration and includes a judicial office, the
office of a minister of the Crown, the office of a member of the Senate or
House of Commons of Canada, a member of a legislative assembly or a
member of a legislative or executive council and any other office the
incumbent of which is elected by popular vote or is elected or appointed in a
representative capacity, and also includes the position of a corporate
director, and "officer" means a person holding such an office;
116. Since the "office" under s.2(l) of the CPP is defined the same as "office" under
s.248(1) of the ITA, if an individual wants to engage in "pensionable employment"
for the purposes of the CPP, then that individual also performs those duties for an
"office" within the meaning of s.248(1) of the ITA.
117. An office, and the officer that fills that office are "conceptually divisible but legally
indivisible" (The Queen's Other Realms, Peter Boyce, Canberra, Federation Press,
2008 at p.5).
118. Revenue for any office is profit for that office (Goldman v. Minister of National
Revenue, [1953] 1 SCR 211; Mr. C. v. Minister of National Revenue. 50 DTC 206).
119. Only 81 days after the Supreme Court ruled in Goldman v. Minister of National
Revenue [1953] 1 SCR 211 that revenue for an office is profit for that office, the
Parliament of Canada assented on May 14, 1953 An Act to amend The Income Tax
Act, 12 Elizabeth II, Chapter 40 which added the definitions of "employee" and
"employer" to the ITA which are still currently used:
a. "employee" includes officer;

b. "employer", in relation to an officer, means the person from whom
the officer receives his remuneration;
120. The definition of "employer" has two meanings: one, if there is a "relation to an
* officer", and two. if there is no "relation to an officer". This corroborates with the
Appellant's position that he has a freewill choice to be such an officer.
121. Given that revenue for any office can only be profit for that office, and because the
office and the officer are "conceptually divisible but legally indivisible", being
clothed with the powers of an office gives an individual, such an officer, the legal
capacity to convert revenue into profit for that office.
122. Conversely, not being clothed with the powers of an office (no relation to an
officer") means such an individual is without legal capacity to convert revenue into
profit for that office.
123. Given that revenue for an office is profit for that office, and that the ITA taxes profit,
the Minister deemed that the Appellant wanted to be an "officer" within the
meaning of s.2(l) of the CPP who holds the same office as an "officer" within the
meaning of s.248(l) of the ITA, and consequently the Minister assessed the income
the Appellant made under the PC as profit for an "office" within the meaning of s.
2(1) of the CPP and s. 248(1) of the ITA.
124. The income or profit of an "officer" within the meaning of s.248( 1) of the ITA
includes income from the four main sources of income recognized by the ITA:
business, property, office and employment (ITA s.9(l); 6(3)).
125. The definitions in the ITA of "employed", "employment" and "employee' all show
that they all deal with an ITA s.248(1) "officer"; ITA s.248(1) employed is:
"performing the duties of an office or employment"; ITA s.248(l) employment is:
"the position of an individual in the service of Her Majesty' (as an officer); and ITA
s.248(1) employee is "includes officer". This was also shown in the Appellant's
filing to CRA of his exempt income by letter using many flowcharts and diagrams.
126. Given that s.2(l) of the CPP defines "employment" as "includes the tenure
(holding) of an office and s.2(l) of the CPP "employee" as "includes an officer",
the ITA "office" is the same as the CPP "office".
127. Subsection 6(3) of the ITA states:
6(3) An amount received by one person from another

(a) during a period while the payee was an officer of, or in the employment of,
the payer, or
(b) on account, in lieu of payment or in satisfaction of an obligation arising out
of an agreement made by the payer with the payee immediately prior to, during
or immediately after a period that the payee was an officer of, or in the
employment of, the payer,
shall be deemed, for the purposes of section 5. to be remuneration for the
payee's services rendered as an officer or during the period of employment,
unless it is established that, irrespective of when the agreement, if any, under
which the amount was received was made or the form or legal effect thereof, it
cannot reasonably be regarded as having been received
(c) as consideration or partial consideration for accepting the office or entering
into the contract of employment,
(.d) as remuneration or partial remuneration for services as an officer or under
the contract of employment, or
(e) in consideration or partial consideration for a covenant with reference to
what the officer or employee is, or is not, to do before or after the termination
of the employment.
128. Since the definition of employment in ITA s.248(l) is: "the position of an
individual in the service of Her Majesty" (as an officer) and s.2(l) of the CPP
defines "employment" as "includes the tenure (holding) of an office , we can then
substitute that phrase "as an officer" for whenever ITA s.6(3) says "employment';
and since ITA s.248(1) employee is "includes officer" and s.2(l) of the CPP
"employee" is "includes an officerwe can also substitute "officer for
"employee" so that we end up with:
6(3) .An amount received by one person from another

(a) during a period while the payee was an officer of, or as an officer of, the
payer, or
of an agreement made by the payer with the payee immediately prior to, during
or immediately after a period that the payee was an officer of, or as an officer
of, the payer.
shall be deemed, for the purposes of section 5, to be remuneration for the
payee's services rendered as an officer or during the period of as an officer,
unless it is established that, irrespective of when the agreement, if any, under
which the amount was received was made or the form or legal effect thereof, it
cannot reasonably be regarded as having been received
(c) as consideration or partial consideration for accepting the office or entering
into the contract of as an officer,
(d) as remuneration or partial remuneration for services as an officer or under
contract as an officer, or
(<?) in consideration or partial consideration for a covenant with reference to
what the officer or officer is, or is not, to do before or after the termination as
an officer.
129. Simplifying the redundant officers, we then get:
6(3) An amount received by one person from another

(a) during a period while the payee was an officer of the payer, or
of an agreement made by the payer with the payee immediately prior to,
during or immediately after a period that the payee was an officer of, the
payer,
shall be deemed, for the purposes of section 5, to be remuneration for the
payee's services rendered or during the period of as an officer, unless it is
established that, irrespective of when the agreement, if any, under which
the amount was received was made or the form or legal effect thereof, it cannot
reasonably be regarded as having been received
(c) as consideration or partial consideration for accepting or entering into the
contract as an officer,
(id) as remuneration or partial remuneration for services as or under contract as
an officer, or
(e) in consideration or partial consideration for a covenant with reference to
what the officer is. or is not, to do before or after the termination as an officer.
130. From this simplified version of ITA s.6(3), one can see that a payee 'shall be
deemed"' to be an officer. "unless it is established that, irrespective of when the
agreement, IFANY', it "cannot reasonably be regarded' as consideration as an
officer. In other words, an agreement between the payer and the payee to work not
as an officer can be made "immediately prior to, during or immediately after" a
period that the payee was an officer" (at any time), and that the agreement can be
verbal, written, or NONE AT ALL.
131. While working under the PC, because the Appellant was not clothed with the
powers of an "officer" within the meaning of s.2(l) of the CPP or within the
meaning of s.248(l) of the ITA, he was without legal capacity to convert his
income from any source of income into profit, including the four main sources in the
ITA, of an "office" within the meaning of the s.2(l) of the CPP or within the
meaning of s.248(l) of the ITA:
a. From a business source within the meaning of s.9(l) of the ITA, or

b. As a benefit conferred on a shareholder from a property source within the
meaning of s.15(1) of the ITA, or
c. As an employee source within the meaning of s.248(l) of the ITA, or
d. As director's fees from an office source within the meaning of s.248(1) of the
ITA.
132. Subsection 18( 1 )(a) of the ITA states:11 in computing the income of a taxpayerfrom
a business or property no deduction shall be made in respect of an outlay or
expense except to the extent that it was made or incurredfor the purpose ofgaining
or producing income from the business or property"
133. Subsection 2(2) of the ITA defines "taxable income" as:
2.(2) The taxable income of a taxpayer for a taxation year is the taxpayer's income
for the year plus the additions and minus the deductions permitted by Division C.
134. Subsection 18(l)(c) of the ITA states that in computing the income of a taxpayer
from business or property, "no deduction shall be made if an expense was made for
the purpose of making exempt income, or in connection with property the income
from which would be exempt". As stated earlier in paragraph 14, the appellant did
not seek to deduct or claim expenses (such as vehicle expenses or a home office) or
benefits (such as CPP or GST) from the income he earned under the PC.
135. Section 248(1) of the ITA defines "exempt income" as:
"exempt income" means property received or acquired by a person in such

circumstances that it is, because of any provision of Part I. not included in
computing the person's income, but does not include a dividend on a share
or a support amount (as defined in subsection 56(1))."
136. As the Appellant did not seek to deduct or claim expenses or benefits and never
consented to his income (made under the PC) to being converted in his hands into
profit for an "office" within the meaning of s.248(l) of the ITA, it is not profit tor
such an office as a "dividend on a share", nor a deductible expense such as "a
support amount, as defined by s.56(l)" of the ITA tor such an office, the
Appellant's income under the CFH qualifies as "exempt income" within the
meaning of s. 248(1) of the ITA.
137. There is no definition of 'income' in the ITA, other than the meaning in s.129(4) of
the ITA for private corporations. This means that 'income' for the purposes of the
ITA could be "exempt income" within the meaning of s.248(1) of the ITA.
138. Reading ITA s,18(l)(a) in conjunction with ITA s.l8(l)(c), one can reasonably
conclude that ITA s.l8(l)(a) allows deductions for expenses only when it was made
or incurred to produce 'income' that is not ITA s.248(l) "exempt income ', and,
conversely, a taxpayer cannot earn 'income' that is "exempt income' within the
meaning of s.248(1) of the ITA if that taxpayer deducts or claim expenses (such as
vehicle expenses or a home office) or benefits (such as CPP, or GST credits), but
only taxable income within the meaning of s.2(2) of the ITA (or, if a personal
endeavor or a hobby for the "office" within the meaning of s.248(l) of the ITA, as
nontaxable income).
139. In R. v. Porisky and Gould, 2012 BCSC 67, Porisky, the founder and sole owner of
Paradigm Education Group, and the author of the Appellant's PC, accepted
expenses as deductions in that Honourable Court:
[25] The accused were provided with Mr. Brunke's spreadsheets ahead of his
testimony.
[28] Mr. Brunke then deducted the expenses of Paradigm which are summarised
as follows:
(A chart is produced in paragraph 28, with a total of expense allowed including:

Meals & Entertainment (50%), Business Use of Home (20%), Motor Vehicle
(100%), Office Supplies, Professional Fees - Legal, Hotel/ Conference, Travel,
Bank Fees, and Interest.)
[29] None of the above evidence was challenged by Mr. Porisky in cross-
examination or in his own evidence.
[31 ] The above resulted in a net business income of $XXX for the 2004 to 2008
taxation years.
140. As Porisky accepted the expenses he incurred as deductions, Porisky converted his
former exempt income into taxable income within the meaning of s.2(2) of the ITA
for the "office" within the meaning of s.2(l) of the CPP or s.248(1) of the ITA. This
is confirmed by paragraph [32] when the CRA Investigator assessed Porisky CPP
contributions:
[32] Mr. Brunke allocated the net income evenly between the accused and then
reduced the amount to factor in Canada Pension Plan contributions.
141. The ITA s.3 states:
3. The income of a taxpayer for a taxation year for the purposes of this Part is the
taxpayer's income for the year determined by the following rules:
(a) determine the total of all amounts each of which is the taxpayer's income for
the year (other than a taxable capital gain from the disposition of a property) from
a source inside or outside Canada, including, without restricting the generality of
the foregoing, the taxpayer's income for the year from each office, employment,
business and property,
(b) determine the amount, if any, by which
(i) the total of
(A) all of the taxpayer's taxable capital gains for the year from dispositions
of property other than listed personal property, and
(B) the taxpayer's taxable net gain for the year from dispositions of listed
personal property,
exceeds
(ii) the amount, if any, by which the taxpayer's allowable capital losses for
the year from dispositions of property other than listed personal property
exceed the taxpayer's allowable business investment losses for the year,
(c) determine the amount, if any, by which the total determined under
paragraph (a) plus the amount determined under paragraph (b) exceeds the
total of the deductions permitted by subdivision e in computing the
taxpayer's income for the year (except to the extent that those deductions,
if any, have been taken into account in determining the total referred to in
paragraph (a), and
(d) determine the amount, if any, by which the amount determined under
paragraph (c) exceeds the total of all amounts each of which is the
taxpayer's loss for the year from an office, employment, business or
property or the taxpayer's allowable business investment loss for the
year,
and for the purposes of this Part,

(e) where an amount is determined under paragraph (d) for the year in
respect of the taxpayer, the taxpayer's income for the year is the amount so
determined, and
(f) in any other case, the taxpayer shall be deemed to have income for
the year in an amount equal to zero.
142. As the Appellant's income under his PC has no 'income' "'from each office,
employment, business, and property" (as they are all profit for an '"office" within
the meaning of s.248(l) of the ITA), has no capitals gains or losses, and does not
wish to take any deductions such as "deductions permitted by subdivision e " or
"loss from an office, employment, business or property" or any "business
investment loss", the Appellant's income from the PC is deemed by s.3(f) of the
ITA to be equal to zero.
143. The Appellant's income from the PC is deemed by s.3(f) of the ITA to be equal to
zero. Applying the rates for tax contained in s.l 17(2) of the ITA, no income tax is
payable on the Appellant's income made under the PC. He reported the exempt
income made under the PC in a letter dated February 26, 2014 to the CRA, showing
his Social Insurance Number that indicated his status as a "legal representative' for
the purposes of the ITA instead of the "social insurance number" of the "office".
144. Use of privileges of an "office" of Her Majesty related to the ITA, such as being able
to claim expenses as deductions, and/or doing "pensionable employment" for CPP
means that a charge or fee, such as income tax, can be levied by Her Majesty on the
officer for use of such an "office" (FAA, s.l9.1).
145. As the Appellant did not seek to deduct or claim expenses or benefits and also never
consented to his income (made under the PC) to being "pensionable employment"
within the meaning of s.2(l) of the CPP, the Appellant does not owe any fee, such
as income tax under s.l 17(2) of the ITA, as he never filled the "office'' as an officer
while working under his PC.
146. The Appellant, having filed all income by Tl (taxable income for the "office" as
"officer") and also by letter (exempt income received not as "officer' under the PC),
was not charged by CRA for making omissions or false statements on a return under
s.239(l)(a) of the ITA or with tax evasion under s.239(l)(d) of the ITA (HMTO v.
Redpath Industries Ltd. and Dominion Sugar Company Ltd. 84 DTC 6349).
147. Section 2( 1) of the FAA states that, "Subject to this Part, all public money shall be
deposited to the credit of the Receiver General"
148. Individuals who work as "officers" within the meaning of s.2(l) of the CPP,
s.248(l) of the ITA, and s. 123(1) of the ETA file the office's income on Tl Income
and Benefit Returns which state on page 4 that payments are payable to the
Receiver General.
149. Another reason the Appellant's income received under his PC is "exempt income"
within the meaning of s.248(1) of the ITA and is deemed to be equal to zero by s.3 (f)
of the ITA is that it prevents Her Majesty from doing theft by conversion, an offence
under s.322(1) of the Criminal Code, of the Appellant's private property into
"public money" within the meaning of s.2 of the FAA.
150. As the money received under the PC is the Appellant's private property, the owner
is the only person who can legally convert ("consensual interference") his private
property into "public money" within the meaning of s.2 of the FAA.
151. Her Majesty and her agents should stay in honour and not commit any Criminal
Code offences, such as theft by conversion, as evidenced by the address of judges in
courts as "Your Honour", and Canadian courts as "This Honourable court".
152. Because Her Majesty should not commit theft by conversion, that is why the
Minister needs to deem taxpayers, such as the Appellant, to be an "officer" for Her
Majesty's "office" within the meaning of the s.2(l) of the CPP or within the
meaning of s.248(l) of the ITA, as income for such an office can only be "public
money" within the meaning of s.2 of the FAA, is declared on a Tl Income and
Benefit Return, and any tax payable, as stated on page 4, is to the Receiver General.
153. The terms of the PC where the Appellant declined to work as an "officer" within the
meaning of s.2(l) of the CPP or s.248(l) of the ITA, or to engage in "pensionable
employment" within the meaning of the CPP', the representations submitted by the
Appellant during the audit and these proceedings all show that the Appellant does
not wish, as permitted under s.6(3) of the ITA, to work under the PC as an "officer '
within the meaning of s.2(l) of the CPP or s.248(l) of the ITA earning "public
money" within the meaning of s.2 of the FAA.
154. A CRA Press Release dated November 26, 2015 on taxpayer Cory Stanchfield states
that Paradigm Education Group, who developed the PC used by the Appellant,
teaches '"how to restructure their affairs to avoid paying income tax".
155. Since the ITA says the Appellant's exempt income received under his PC is deemed
equal to zero, and the Appellant cannot be charged a fee (income tax) since he did
not use the privileges of an "office" of Her Majesty related to the ITA or CPP, and
CRA did not charge the Appellant with either making omissions or false statements
on a return or with tax evasion, and the Supreme Court of Canada and the Privy
Council of England agreed that contracts for work (if done not for the office related
to the ITA or CPP) are ultra vires the jurisdiction of the federal government, and
CRA agrees that the PC is tax avoidance and not tax evasion, the Appellant
submits that the Minister erred in reassessing his 20102012 taxation years by
including in the calculation of his taxable income for those years the income he
earned under the PC. His total income should be recalculated to what he reported
on his Tl returns and in his letter date February 26, 2014.
Re: Issue 3 (reassessment tax credits: GSTC; BCCATC; BCHSTC):
The Excise Tax Act defines "office" in s.123(1) as:
"office" has the meaning assigned by subsection s.248(l) of the Income

Tax Act, but does not include (a) the position of a trustee, in bankruptcy,
(b) the position of receiver (including the position of a receiver within the
meaning assigned by subsection 266(1), or (c) the position of a trustee or a
trust or personal representation of a deceased individual where the person
who acts in that capacity is entitled to an amount for doing so that is
included in computing, for the purposes of that Act, the person's income or,
where the person is an individual the person's income form a business;
The Excise Tax Act defines "officer" in s.123(1) as:
"officer" means a person who holds an office;
156. The definition of "office" in s.248(l) of the Income Tax Act is nearly identical as the
definition of "office" in s.2(l) of the CPP Act. This means the ETA (GST), the ITA,
and the CPP are connected through a sole "office" by a sole "officer" of Her
Majesty dealing with the CRF with GST, income tax, and CPP. This corroborates
with CRA Tax Alert, "Abuse of source deductions and GST/HST amounts held in
trust". This was also shown with flowcharts and diagrams in the Appellant's letter to
CRA dated April 27, 2015.
157. This is supported by the Minister's right under s.224.1 of the ITA to setoff debts
owed to the public from the CRF. An individual s consent to become an "officer
for the purposes of the ETA (GST), ITA, or CPP is also his or her consent to obtain
the benefits, and to assume the powers and duties associated with the "offices"
created by the other statutes listed here, thereby creating a sole office. Therefore, the
Minister can offset any debt under any of these statutes against any credits under
any of the other statutes.
158. In R. v. Porisky and Gould, 2012 BCSC 67, Porisky was assessed GST:
[80] The services and goods sold by Paradigm were subject to GST under the Part
IX of the Excise Tax Act. The GST should have been charged and remitted, less
applicable input credits. That was not done. Once again, the only reason for that
can be Mr. Porisky's "natural person" theory.
159. Porisky was assessed GST by the Honourable Court because he accepted in Court
the privilege of being able to deduct expenses at paragraphs [28] and [29] that are
unique to an "office" within the meaning of s.248(l) of the ITA, which is the same
"office" within the meaning of s.l 23(1) of the ETA (GST).
160. As the Honourable Court stated that "the only reason for that can be Mr. Porisky's
" natural person " theory'', one can reasonably conclude that Honourable Court
meant by "natural person" theory a taxpayer, such as Porisky, who had intended to
earn exempt income, but later accepted benefits and/or deductions unique to the
"office" within the meaning of s. 2(1) of the CPP and s. 248(1) of the ITA. and
thereby legally converted his exempt income into profit for that "office ', which
becomes taxable income for the "office", and also attaches CPP and GST.
161. BCCATC applies only if the taxpayer claims GST credits on page 1 of the Tl
return, and BCHSTC is available only if a taxpayer qualifies for GST credits.
162. As the Appellant declined to be an "officer" within the meaning of s.2(l) of the
CPP (which is the same "officer" within the meaning of the ETA (GST)), he lacks
the legal capacity to qualify for GSTC, BCCATC, and BCHSTC in relation to his
income under the PC.
163. In summary, the Appellant submits that the Minister erred when reassessing his
income made under the PC for the 20102012 taxation years by reassessing the
GST credits and BCCAT credits for base years 20102012 years, and BCHST
credits for base years 2010 and 2011, and should be recalculated to what the
Appellant had originally reported.
Re: Issue 4 (assessment ITA s.l63(2) penalties):
164. Individuals who work as "officers" within the meaning of s.2(l) of the CPP,
s.248(1) of the ITA, and s.123(1) of the ETA file Tl Income and Benefit Returns
which state on page 4 that payments are payable to the Receiver General.
165. Section 2(1) of the FAA states that, "Subject to this Part, all public money shall be
deposited to the credit of the Receiver General."
166. Section 17(1) of the FAA defines Consolidated Revenue Fund ("CRF") as:
"Consolidated Revenue Fund," means the aggregate of all public moneys

that are on deposit at the credit of the Receiver General
167. Section 82 of the FAA states that all money received by an officer or person by
virtue of his employment in the collection or management of revenue for Her
Majesty, shall be deemed to be "public money'' belonging to Her Majesty.
168. Individuals who deal with the CRF (FAA s.2 "public money' ) as "officers within
the meaning of s.2(l) of the CPP, s.248(1) of the ITA, and s.123(1) of the ETA owe
a fiduciary duty to the public to report all the FAA s.2 "public money earned for
such "office".
169. Since a fiduciary duty demands the highest standard of performance in law, one
cannot be forced to be such an "officer". This corroborates the Appellant's position
that individual taxpayers can decline to be an "officer" handling "public money".
170. While working under the PC the Appellant declined to receive income as "public
money" within the meaning of s.2 of the FAA for the CRF as "officers" within the
meaning of s.2(l) of the CPP, s.248(1) of the ITA, and s.123(1) of the ETA. His
income under the PC remained his private property, as he lacked the legal capacity
to convert his private property (his money) into FAA s.2 "public money".
171. Since the Minister deemed the Appellant wanted to be an "officer" within the
meaning of s.2(l) of the CPP, s.248(l) of the ITA, and s.l 23(1) of the ETA who
deals with FAA s.2 "public money", the Minister also deemed that he owed a
fiduciary duty to the public. Consequently, he assessed penalties under s.l63(2) for
the income the Appellant made under the PC as FAA s.2 "public money" for the
ITA "office", and penalties under s.238(1) for the GST "office", and under s.38( 1)
of the BCITA for the BC income tax. The terms "business", "employed",
"employee", "employer", all are defined in s.l (1) of the BCITA as "having the same
meaning as in the federal Act" (ITA).
172. The terms of the PC, where the Appellant declined to engage in "pensionable
employment" by an "officer" within the meaning of s.2(l) of the CPP (which is the
same as "officer" defined in s.248(1) of the ITA and in s.123(1) of the ETA (GST)),
the representations made by the Appellant during the audit, and these proceedings
all demonstrate that the Appellant does not wish to work under the PC as an
"officer" within the meaning of s.2(l) of the CPP, s.248(1) of the ITA, and s.123(1)
of the ETA. As the Appellant is not dealing with FAA s.2 "public money", he does
not owe any fiduciary duty to the public.
173. As the Appellant never consented his private money (made under the PC) to be
converted in his hands into FAA s.2 "public money" as if he were an "officer" that
deals with the CRF, it is a legal impossibility for him to owe any fiduciary duty to
the public related to such an office. He is therefore not liable for any fines or
penalties under s.l 63(2) of the ITA.
Subissue:
174. The following Government of Canada forms use the SIN as a "Social Insurance
Number" styled with upper and lower case letters to indicate an individual's status
as a "legal representative" for the "officers" within the meaning of s.2(l) of the
CPP, s.5(4)(g) of the El Act, s.248(1), of the ITA, and s.123(1) of the ETA. The
individual's legal liability can be understood by studying the forms:
i. INS3166 Request for Record of Employment the legal representative

agrees to pay back any Employment Insurance overpayments.
ii. ISP3000 Application for Old Age Security Pension - "if you make a
false or misleading statement, you may be subject to an administrative
monetary penalty and interest if any. under Old Age Security Act, or may
be charged with an offence."
iii. RC199 Voluntary Disclosure Program Taxpayer Agreement the legal
representative assumes liability for consenting to and disclosing that his
income is from an "office" within the meaning of s.2(l) of the CPP,
s.5(4)(g) of the EI Act, s.248(l) of the ITA, and s.123(1) of the ETA. -
iv. T1162 PreAuthorized Payment Plan the legal representative
authorizes payment plan for payment of income tax.
v. T2029 Waiver of Reassessment Period the legal representative
assumes liability for consequences of allowing CRA to reassess beyond
the normal reassessment period.
vi. NR5 Nonresident individual applies for reduction in withholding of
nonresident tax. Legal representative signs and accepts liability.
vii. NAS-2120 Social Insurance Number Application Applicant consents
to being liable for administration and enforcement of the legislation
related to the SIN upon receipt of the Social Insurance Number.
viii. T1013 Authorizing or Cancelling a Representative LR signs and
agrees to be l iable for the actions of the representative that he or she
authorizes.
ix. CPT-1 Request for a Ruling for Status of Worker for CPP and/or EI
Legal representative signs and agrees to be liable for the ruling the legal
representative has requested from the CRA
175. In contrast, the following Government of Canada forms use the SIN as a "social
insurance number" styled with all lower case letters to indicate an individual's
status when he "appoints himself in a representative capacity' (CPP s.2(l)"office")
and holds that position as "officer" within the meaning of s.2(l) of the CPP,
s.5(4)(g) of the EI Act, s.248(l) of the ITA, and s.l23(l) of the ETA, and deals with
duties and benefits for that "office":
x. T2125 income for such an office from business

xi. T2 Schedule 50 income for such an office from property (share
dividends)
xii. T4 income as ITA s.248(l) "employee"
xiii. TDl consent to work as ITA s.248(l) "employee" for such an office, as
applicant has to estimate the officer's taxable income, and can claim
deductions (cannot claim deductions if making exempt income not for
such an office: ITA s.l8(l)(c)).
xiv. T2091 Designation of Principal Residence by an Individual in order to
claim capital gain exemption for such an office, as cannot claim a benefit
if making exempt income not for such an office: ITA s.l8(l)(c)).
xv. T5018 Contract Payment Reporting System — construction payers report
that their subcontractors work for such an office, so that office's income is
taxable.
xvi. CPT-100 Appeal of Ruling Under the CPP and/or EI Act - Worker
ruled as officer is identified on the CPT100 with "social insurance
number".
176. CRA forms CPT1 and CPT100, which are to be used in that sequence, show that
an individual can apply for a ruling as a "legal representative" under ITA s.l59(1)
using a Social Insurance Number styled with upper and lower case letters, and that
the individual can appeal the ruling with form CPT100 as an " officer" within the
meaning of s.2(l) of the CPP and s.5(4)(g) of the EI Act that is identified with a
"social insurance number" styled with all lower case letters.
177. In addition, CRA has different definitions on their web site for the SIN as a Social
Insurance Number styled with upper and lower case letters, and the "social
insurance number" styled with all lower case letters. This has led the Appellant to
believe that the SIN as a Social Insurance Number styled with upper and lower case
letters, and the SIN used as a "social insurance number" styled with all lower case
letters, signify two different things in law.
178. This all leads the Appellant to conclude that an individual who "appoints himself in
a representative capacity" (CPP s.2(l) or JTA s.248(l) "office") and holds that
position as an "officer" within the meaning of s.2(l) of the CPP, s.5(4)(g) of the EI
Act, s.248(1) of the ITA, and s,123(l) of the ETA, either by:
a. Filling out form(s) with the nine digit number he obtained from Canada
Employment Insurance Commission as a Social Insurance Number by using the
nine digits on a form such as Tl, T2125, T4, TDl, T2091, but used as a "social
insurance number" to identify the "office"; or
b. A subcontractor not contesting the use of a ninedigit "social insurance number"
on a T5018 form filled out by a contractor; or
c. Claiming benefits associated with this "office" within the meaning of s.2(l) of
the CPP, s.5(4)(g) of the EIAct, s.248(l) of the ITA, and s.l23(l) of the ETA
such as: CPP, Employment Insurance, principal residence exemption, universal
child care benefits, spousal credits, GST credits, expenses as deductions, to
name but a few that are listed in a Tl Income and Benefit Return and associated
Schedules that also uses "social insurance number" to identify the office.
179. Section 18( 1 )(c) of the ITA states that in computing the income of a taxpayer from
business or property, no deduction shall be made if an expense was made for the
purpose of making exempt income, or in connection with property the income from
which would be exempt.
180. The Appellant's income under the PC qualifies as exempt income. As such, it was
legally impossible for him to report his income made under the PC on a Tl form;
accordingly, the Appellant reported his exempt income to CRA in a letter showing
his Social Insurance Number indicating his status as a "legal representative ' for the
purposes of the ITA. The Appellant reported his exempt income in a letter because
CRA does not provide a form for individuals like the Appellant to report their
exempt income using a SIN to indicate their status as a "legal representative" and
not as an "officer" for the purposes of the CPP, EI, ITA, or ETA.
181. CRA agrees that the Appellant made no omissions or false statements since he was
not charged with making omissions or false statements on a return under
s.239(l)(a) of the ITA (Her Majesty The Queen v. Redpath Industries Ltd. and
Dominion Sugar Company Ltd. 84 DTC 6349).
182. As the Appellant declared all his income, and as he did not incorrectly report the
income he made under the PC on the Tl, and as CRA does not have a form for
filing ITA s.248(l) "exempt income" with a Social Insurance Number, and as
income that is not ITA s.2(l) "taxable income" is not required by the ITA to be
reported, and as CRA agrees that the Appellant made no omissions or false
statements, the Appellant submits that the Minister erred in reassessing the
Appellant's 20102012 taxation years by including penalties for false statements or
omissions. He further submits that his income for those years should be
recalculated as he originally reported to CRA on his Tl returns and by his letter
dated February 26, 2014.
G. Relief Sought
183. The Appellant respectfully requests:
d. That the appeal be allowed;

e. That the assessment under appeal be varied back to the tax filings by Tl and
by letters filed by the Appellant;
f. That he receive the costs of his appeal, and
g. Such relief as this Honourable Court deems just.
ALL OF WHICH IS RESPECTFULLY SUBMITTED this 22 day of February 2015.
William Russell
Ave
Surrey, BC, V4A
604
@shaw.ca
A P P E N D f * A
Schedule A
Duties and Compensation of Directors and Officers of
DR. WILLIAM RUSSELL NATUROPATHIC INC.
Director
1) The director must abide by the law as set out by the BC Corporations Act
("Act"), and also by the articles of this Corporation ("Articles").
2) The director shall be responsible for, but not limited to, the following duties:
a. Make decisions for the best interest of the Corporation.
b. Attend board meetings as required by law.
c. Appoint, supervise, and remove corporate officers.
d. Sign director's resolutions that are passed.
e. Authorize major corporate policy decisions with a proper resolution.
f. Perform due diligence in order to invoke the business judgement rule.
g. Oversee contract negotiations, including but not limited to,
compensation for natural persons working under a private contract
for hire for their own benefit, or for "employees"
uj/uo /iuuo nay 10; m a oiHtoîtooô w e i g A&suaaiw iyj u u u / u y u
APPENDIX A
Province of British Columbia
Company Act
General Meeting
Location: Ave.
Individuals present at meeting: D S director

L R secretary
William Russell
At a meeting of the directors for DR. WILLIAM RUSSELL NATUROPATHIC INC.

the following was passed:
Date Resolution passed: August 16, 2005
Corporate Resolution
The Board of Directors appointed Dr. William Russell to the position of director of the
Company and member of the Board. Dr. Russell has been a previous Director of the
Board of this Company. He has been invol ved in the health care field for over 24 years.
On August 14, 2005 D S resigned from the Board of Directors of Dr. William
Russell Naturopathic Inc. D S has served as the director since February 15,
2004. He resigned from the Board of the company because of personal related reasons.
D S is not presently serving on the Board of Directors of any other company. He
will remain as a consultant to,the Company.
William Russell, Director

/ A P P c N D i x B
Contract for Hire™
Private (Free Agent) Agreement
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by and between, U/. /Av^ company ("Principal").
whose mailing address is C/O
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engage the services of the Agent under the terms and conditions of this private agreement, and
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panics hereby agree us follows:
A . A f f i l i a t i o n . U p o n a c c e p t a n c e o f t h i s A g r e e m e n t the. A g e n t b e c o m e s e n t i t l e d t o a l i t h e b e n e i i i s a n d
privileges expressed in this Agreement, as well as any other benelits that rntiy be offered by tne
Principal, subject' to llie Agc:nrsTrec\vili and voluntary consent.
I>. Principal and Asicnt As.sociafion
1. Relationship. The Agent consents to being engaged for his services in his capacity as a natural
person, and does not consent lo being deemed an employee as defined in any federal or provincial
statute, including but not limited to any provincial Employment Standards Act. Nothing contained
in this Agreement shall be regarded as the Agent consenting to or creating any other relationship
between" the. Principal and the Agent, including without limitation, director/ofhccr,
franchisor/franchisee. joint venture, partnership, shareholder, or any legal entity, other than tne
relationship as set forth and agreed upon under the terms of this Agreement.
2. Canada Pension Phm. The Agent consents to being engaged for his services in his capacity as a
natural person, and d o e s not consent 10 performing services in the capacity of an ' oilicer in
"pensionable employment'', as defined by the Canada Pension Plan Act.
3. Taxes. The Agent consents to being engaged for his services in his capacity as a natnnii person,
and does not consent to accepting or performing the duiies of an "of I see or employment m me
capacity of an "officer's or any other entity defined in the Income Tax Act of Canada ior
provincial or federal income tax purposes. The Principal acknowledges that ths Agent herein
warrants that the Agent agrees to be liable for the payment of any applicable tedera: taxes
toeether with any and ail applicable provincial, municipal, and local taxes, il any. Ihe Agent
hereby agrees to fulfill such obligations, if any. The Agent hereby holds the Principal harmless
and waives any claims he has. or may have, against the Principal, now or m the future, respecting
such taxes, if any. Furthermore, the Agent acknowledges and agrees that the Principal has me
n g l H n o t t o w i t h h o l d , n o t t o p a y a n d n o t t o c o n t r i b u t e t o s u c h t a x e s , i f a n y . o n o e h a l t o l i h e "'gent.
v.
4 V ' n e n t i n s u n m c e / r h e A g e n t c o n s e n t s s o b e i n g e n g a g e d f o r h i s s e r v i c e s i n h i s . o p a c i t y as.
a n a i u r a j p e r s o n , ana a c e s n o t c o n s e n t t o p e r i o r m i n g s e r v i c e s a s a n " i n s u r e d p e r s o n " i n "insurable
employment", as defined by Employment insurance Act of Canada, with respect to the services
P ^ i ; 0 ! n . e d b> t h e .\gt * . n i ! o i i n s a p p l i c a t i o n u r , a n d b e n c l i t s a v a i l t t b l c , u n d e r d i e E m p l o y m e n t
Insurance Ace o f Canada. T h e Agent reserves the right and m a y apply, at his o w n discretion, «>
tne Commissioner responsiole for the Employment Insurance. Act, to make regulations to include
his employment tinder this private Agreement as insurable employment. The Agent hereby holds
ihe Puncipui harmless and waives any claims he .has, or may have, against ihe Principal, now or
m the future., respecting such premiums to be paid. The Agent acknowledges and agrees'that the
Principal has the r;gm no; to withhold, not to pay, and not to contribute lo such premiums, if any,
on behalf O! the Agent, unless and until the Agent voluntarily m a k e s the appropriate application
to the Commissioner tor such benefits and approval by the Commissioner has been received.
W o r k e r s Compensation. Unless it is otherwise established by the intentional and voluntary

actions of the Agent and as set forth and agreed upon in this Agreement, the Agent is, and
cOuiCiiis to neing engage.;: lor his services: m his capacity as a natural person, and does not
c o n s e n t n> w a i v e h i s c o m m o n l a w r i g h t t o s u e i h e P r i n c i p l e t o W C B f o r s t a t u t o r y w o r k e r s
compensation însurance cov eragc or to be recognized as a person in law performing services in
tne capacity of a worker", as defined by the Worker's Compensation Act, in ihe province of this
Agreement, 'i he Agent hereby agrees to hold the Principal harmless and waives any claim he has
0 ! ,n">" n a v ~ we Principal now or m she imure for any injury or death as a result of beine
engaged t:nder this Agreement, other than injury or death caused by the Principal by way of erus's
riegng'.iicc 01 c i i m m a i actions. As a 'either expression of the .Agent's intent, the Agent agrees m
s i g n a n a d d i t i o n a l l i a b i l i t y w a i v e r a t l i t e r e q u e s t o f i,he P r i n c i p a l .
a t !1,c £ i m e l,,,iS Agreement, the Principal is registered with a provincial Worker Compensation
koaid. the Agent may. at h;s sole discretion, apply as an independent operator to the appropriate
statutory workers compensation authority, as prescribed by the applicable Act, to be admitted bv
the board as though the independent operator was a "worker" or equivalent entity.
Despnc any ; e i m oi condition in paragraph d section 5 the .Agent reserves the ncht to apnlv Kir
pnv:i!c accident insurance coverage from any company and under any terms and conditions :he
A g e n t d e e m s a p p r o p r i a t e f o r p r i v a t e c o v e r a g e . T h e A g e n r a g r e e s t o be. f u l l y r e s p o n s i b l e , i n
tc.Spi.et O i a n y p s e m m m s i o r p r i v a t e a c e i o e n t m v a r a n c e c o v e r a e e . a n d a c k n o w l e d g e s a n d iifc'i'i'O.S
t h a i I b e P r i n c i p a l h a s t h e r i g h t oi" n o t i o w i t h h o l d , n o t t o p a y a n d n o t t o c o n t r i b u t e t o s u c h
p i e m i u m s . if a n y , o n n e n a l ; o t t h e A g e n t , u n l e s s a n d u n t i l w r i i t e r s p e r m i s s i o n i s u i v e n t o a n d
lecuved by me Principal irom the .Agent to pay. to any entity oi' individual, such premiums on
behah of the .Agent, Iron: v;ny compensation due to the Agent.
J he. r u n e t p a ! m a y a s s i s t i.n live e x p e n s e a c c r u e d f o r c o v e r a g e u ! a n y i n s u r a n c e o b t a i n e d b y t h e

Agent and may reimburse all or part ol the insurance costs, from time to time, as the Principal so
d es t r e w \ v i [ h o u r i n v o k i l i t ! a n v e s t o p p e l b v c o n d u c t .
Compensation. T n e conip^nsaiion io be paid ro the Agent undcr this Agreement from the
Principal shall be % ** pcr'*?.dA_., on a /)//n/:A/Ahasis e r a s expressed on page 6 of 6
of this Agreement, tttleo, Compensation j ernss and Amend'ments. Any compensation expressed
on page 6 oi 0 of this Agreement shall supercede the compensation expressed in this section once
both parties express: their agreement by placing their initials and the date of the terms of
compensation in the appropriate spacer. Compensation m a y he a m e n d e d from lime to time after
the signing or m i s Agreement on page 6 of 6 o! this Agreement, and any .such amendment shnii
siipe;cedc any prior terms oi compensation agreed to by Ihe parlies once both parlies express their
imeniion to make sucn an amendment by lluir initials ajid the date uf (lie amendmem in ihe
appropriate iipace>. Ever;, thing, including bat not. limited to. compensation, benefits, and bonuses
d u e t o m c A g e n t i1 o n j t n e i ' r m c m u ) u n d e r t h i s A g r e e m e n t s n a i l b e d o c a n e d t o d i e p r i v a t e p r u p e n y
ol' the Agent and subject io due process ol' law.
7. Statements. A s set f o r t h i n t h i s A g r e e m e n t t h e A g e n t s h a l i p r o v i d e t o i h e P r i n c i p a l a n i n v o i c e
reflecting the Agem's name., project number, the time coneerned, the amount yarned, the
expenses accrued", any advanced compensation received from the Principal, or any other financial
concern as permitted by this Agreement. In exchange the Principal shall provide a statement :or
each pay period reflecting the Agents wages, bonuses,, benefits, expenses, or any other Tinancw.
concern as set forth in this Agreement.
S. Expenses. The Principal shall reimburse expenses accrued by the Agent only u die Agent has
prior written a p p r o v a l !rorn i h e Principal to a c c r u e m e e x p e n s e . C l a i m foi K.miOui."!<Hiciii Of mt.
expense by the Agent must be accompanied oy ptooi oi puieha.vo.
C . L i m i t a t i o n s . T h e A g e n t h a s : r o a u t h o r i t y t o b i n d , o r c o n t r a c t o n o e h a l ! o l , t h e H m c i p a ! unie:>.>
s p e c i f i c a l l y a u t h o r i z e d t o d o s o i n w r i t i n g b y t h e P r i n c i p a l , i n c l u d i n g b u t n o t l i m i t e d t o t h e f o l l o w i n g , the.
Aijeni lias no authority to enter into any agreement or mcur any ODligaiion cm pan oi the Piimip.il, bti.u
t h e ' P r i n c i p a l i n i t s d e a l i n g s w u h a n y p e r s o n o r e n t i t y a l P i r a t e d w i s h t r i e P r i n c i p a l , c o m m a t n e i n s ^ t p a l J
pay any money or compensation to any person or eniiiy affiliaiecl with iin: Principal, or commit the
P r i n c i p a l t o a d a t e t h a t a p a y m e n t u r e x e n a n g e w i n be. p . u t u c D y U i e r ' i m c i p a i .
D. Reserved Rights. The Principal expressly reserves the right to adopt policies and procedures from
t u n e t o t i m e t o e n s u r e live o u t c o m e or any service and/oi pioduet, including but not limited to, me
integrity, quality, efficiencv. quitlilicatior.s, and saiety that tne Piancrpal deems appiopiiaie. Ihe
Addendum containing a n y p o l i c i e s o r procedures shall form pari of nits Agieement once both paim.... >o
litis Agreement s i g n a n d date d i e A d d e n d u m iiseif.
E. Conduct. The Agent agrees to use his best efforts to perform the duties required by the Principal
under the terms and conditions us set iorth in this Agreement.
(a) The Auent aerees to cooperate with other Agents and/or any individual or entity
associated or affiliated with tile Principal in a professional, poluc. and respoci tin manner
lo enhance the dignity and worth ol all parties involved.
(h) T h e Agent a g r e e s n o t t o a c t in a n unprofessional m a n n e r o r c o m m i t a n y a c t . w h i c h

would bring Ae Principal and/ur any individual or entity associated or all dialed with me
Principal into, disrepute.
(c) T h e A c te m s h a l l n o i a c t i n a n y m a n n e r t h a t w i l l c a u s e i n j u r y o r i m m i n e n t t h r e a t o ! i n j u r y
io the. Principal, and/or any individual or entity aliiiiuted or associates with the f tincipui.
(di T h e Ac e n t s h a l l n o t i n i t i a t e a n y c i v i l o r c r i m i n a l a c t i o n o r p r o c e e d i n g , b r o u g h t m t h e
name of. or on behalf of, the Principal, which may in any way involve or affect the
Principal and/or any individual or entity affiliated or associated with the Principal.
(e) The Agent shall not misapply and/or embezzle funds or other property ol the Principal
and/or any other individual or entity affiliated or associated with the Principal
(0 The A vent shall not perpetrate any fraud auainsi the Principal and/or any other individual
or entity affiliated or associated with the Principal.
(it) The: Aeen: shall not assign this Agreement or any compensation or expenses due under u
w i t h o u t t h e prior n r i u e n ceaisetu .si the principal.
£ C o n fi d 6 i i t i a j I n f o r n n U i o n . T h e A g e n t a g r e e s t h a t a l l i n f o r m a t i o n s u p p l i e d o r f u r n i s h e d l o t h e A ^ e m .
whether written or otherwise, regarding the business of ihe Principal, herein after cailed Confidential
I n r o r m a b o n , c o n s t i t u t e s p r o p r i e t a r y < i d o r m a n o n a n d as t h e e x c l u s i v e c o n f i d e n t i a l p o s s e s s i o n s o f i h e
Principal.
(;1) "I A g e n t s h a i l ra}<e w h a t e v e r l a w f u l s t e p s n e c e s s a r y t o s a f e g u a r d a n y C o n f i d c n l i a i

Information and prevent any unauthorized disclosure of it to any individual and/or entity.
^'] Upon cancellation of this Agreement lor any reason, the Agent shall immediately
account for within fifteen (15) days and return to the Principal the original and all copies
oi any Conndentia! InTormnuon and. in addition, any other possessions of the Principal
i n c l u d i n g b u t n o t l i m i t e d t o o f n e e s u p p l i e s , e q u i p m e n t 01' t o o l 5 .
1°) I lie. A g e n t s h a h n o t . d i r e c t l y o r i n d i r e c t l y , a t a n y t i m e , e x c e p t i n t h e p e r f o r m a n c e o f t h e
Agent's duties, as required by the Principal, make use of, disclose to any individual and/or entity, or
cause or permit to be used by any person or entity, any Confidential Information.
G. Disputes. Any dispute, controversy or claim between the parties hereto, other than criminal activiiy.
arising out of or relating to this Agreement or an alleged breach thereof which the parties are unable to
r e s o l v e a m i c a b l y s h a l l b e s u b j e c t t o t h e i n j u r e d p a r t y ' s d i s c r e t i o n t o c h o o s e w h i c h o n e o r a I! o p t i o n s f o r
i e i i i c c l v t h a t Desi. s u i u u i j u r ^ d p a r r y s n e e d s , i n c l u d i n g a n d f m u l e d i u , a r b i t r a t i o n . c i v i l p r o c e e d i n g s a n d o r
notice and demand.
II. Agteement I c r m arid Cancellation. 1 his /Agreement may be canceled at any time by either parly
tor any reason upon fifteen (15) days prior written notice to the other party. Bolh panics acknowledge that
eitnej paity has not, intentionally or unintentionally. expressed or implied, agreed io continue tins
Agreement for any definite or indefinite period of lime. Either party mav cancel this Agreement
immediately upon the occurrence of any of die following events;
(a) The Agent's death.
(b) The Agent's inabilities to satisfactory perform any required duties lor any reason.
.1 h e u s e o r a n d / o r u . ' K l e r t h e m r t u e n c e o l a n y i l l e g a l d i ' i i ^ s a n d / o r a l c o h o l
(cl) The damage or imminent threat cf damage to any Agent and/or any individual or entity,
including but not limited to. either party.
I C o m p e n s a t i o n A f t e r C n m d i n (ion. if tins Agreement is canceled by i h e A g e n t ' s death o r for any

othei reason, tne Agent or the Agent s Dene!icjary shad receive, all compensation a n d expenses. If any. to
wmch the Agent is emidee under dus Agreement. Unless designated otherwise in writing, the Agent's
beneficiary shall be the Agent's spouse, legal or commonlaw, if then living, otherwise, the Agent's
estate. No compensation or expenses shall be payable to the Agent or the Agent's beneficiary after
c a n c e l l a t i o n o l t h i s A g r e e m e n t , e x c e p t a s s e t f o r t h en t h i s A g r e e m e n t . U p o n c a n c e l l a t i o n o f t h i s
Agreement, whether or not the Agent Is owed any compensation or expenses, the Principal will furnish
the Agent a statement, wiihin fifteen (i 5; days of the Agent, or Agent:s beneficiary, written request,
d e t a i l i n g a n y a m o u n t , tl a n y . owed t o t h e A g e n t b y t h e P r i n c i p a l or to the Principal by the .Agent, if an
amount is owed to the Agent, the compensation for such amount will accompany the statement. Jf the
A g e n t o w e s a n y a m o u n t t o t l i e P r i n c i p a l , i h e Ag e n t s h a l l f u r n i s h , such amount on demand by the Principal.
Any amount owed by the Agent to rhe Principal shall be secured by the hen and right of first setoff
provided for i n Paragraph j .
j. Lien io Stcurc Inc'le i: i: :}"J l"1 ^ ^ _
f r f 0- a t i e r i t s c a n c e l l a t i o n . t h e P r i n c i p a l : t:;o d -mua t n e t o u t ! o r a n y p a ; t o i s h e ^
Principal from anv compensation or expense due ihe Agent from the Principal under tne terms ui
Agreement. The Principal shall have, and is hereby given a valid first ncn on and ,usiiig.it ol w„ _
against all compensation or expenses due under this or any prior agreement wuh the Inncipa, as i e c u n t ,
for the reimbursement of any and all compensation and claims due. or to become due io me Agent ,iom
the Principal. The. Aaent further agrees to compensate the Principal any interest on any amount uv\u. o ;
the Aaent io the Principal at the rate established by the Principal, which shall not exceed the maximum
rate permuted by the laws of the Province and or Canada applicable therein. Whether or not ihcre na$
been a default cm any debt or claim due to ihe Principal from the Agent, the Agent agrees that the ^
Principal is authorized, at any time without notice and without any judicial action, to ioieciose its iien by
offsetting or otherwise collecting any or all of the Agent's compensation or expenses, accrued or to _
a c c r u e , a g a i n s t t h e r e d u c t i o n o f t h e d e b t o r c l a i m . T h i s l i e n w i l l n o t b e e x t i n g u i s h e d b y t h e c a n c e l l a t i o n Oi
the Agreement.
K . G e n e r a l Provisions. T h e general provisions shah survive, the. cancellation u ! tins Agreement.
(ai The headings of paragraphs and sections are inserted solely for convenience, of reterenee
a,id are not pari of, nor are they intended to govern, limit, enlarge, or aid in me
' c o n s t r u c t i o n o f . a n y t e r m o r p r o v i s i o n h e r e o f .
(b) All accumulated periods of time during which the Agent has been affiliated with the
principal as an Agent or as an intentional or unintentional, voluntary or involuntary,
entity shall be carried forward as if served under this Agreement for the sole purpose o!
determining emblement to. benefits, bonuses, holiday pay, or any other form of
compensaiio;! as well as for seniority, sick dayss, holidays and /or expense.,.
(c) No act of forbearance on the part of cither the Principal or the Agent io enforce any of
t h e p r o v i s i o n s o f t h i s . A g r e e m e n t s h a l l b e c o n s t r u e d a s a i i i o d i i i L . a t i u n wi m s .
nor shall the failure of either part) to exercise any right or privilege granted m.s
Agreement be in anyway considered as a waiver oi that i ighi 01 pi o huge.
id) [f anv word, clause, paragraph, punctuation, term, or provision of diss Agreement shall be
found 10 be void ;md unenforceable by any court of competent jurisdiction, such immng
Jh!ul huvc cfH,ci upon any oilier word, clause, paragraph, punctiiation. term, or
provision oi ;his Agreement, ar.d 'he same shall be given iuil force and efiect.
All terms in this Agreement using any one number or gender shall extend io mean and
include any oilier number rind gender as the facts, context or sense of this Agieement o,
jnv p;.ir:ii.'i'iiph o'i this Agreement iiuiy icCjune.
The Aaent expressly presents and warrants that, as a natural pel son he has me .tuhCi
V' /
a n d r i e h t t o e n t e r i n t o t h i s p r i v a t e A g r e e m e n t a n d i s r e c o g n i z e d a n d p i o u e k . u b_, i,> v '»»
ol* the province. and the Canadian Bill ol Ri^nis i960.
T h applicable* laws of ihe province of this Agreement a n d the lawb oa CajMua hKl*
(S)
govern ibis Agrecniem.
L. G r e a t e r Certainty. For g r e a t e r certainty the mieni. mierprotaison. and app.ieauoii ,l >.ns
shall be subicct to the doctrines of Freedom of Contract and IV.vity oi Contract, auu * ..
and applied for the protection of the Principal's ar.d Agent s natural and legal 1 , g 'A'^
privileges recognized under the laws of the province and the laws ol Canada applicable themto. m J n u r c
but not limited to. live (..anad:an o ! ;\iU::t> i m.'.
M. Acceptance. The Principal and ihe Agent agree thai they each have carefully read and understand tins
Agreement in its entirety, and mutually agree, free of any undue influence from cacn other or any othti
individual or entity. that the ierms unci conditions oi this Agreement are reasonable and nave been made
in good faith.
Authorized Signatory Signature
Contract for Mire''" Serial Number_Xl^J^~A~
Compensation Terms and Amendments

Dnle Compensation Principal A gent
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pjrucfi cm i:(U)caiion Gicup U ~j0-< Ail >'< Rijvjrvc'CJ
Province of British Columbia
COMPANY ACT
D R . W I L L I A M R U S S E L L N A T U R O P A T H I C C O RP .
SPECIAL RESOLUTION
At a meeting of ihe directors for DR. WILLIAM RUSSELL NATUROPATHIC CORP. the follovvin
was passed:
Date Resolution passed: February 14, 2005
Resolution
;; BE IT RESOLVED AS A SPECIAL RESOLUTION that DR. WILLIAM RUSSELL

NATUROPATHIC. CORP. has entered into a contraci for hire vviih William Russell a
natural person, for compensation to manage company.
thorized Signatory)
l£
( Relationship to company )
SCHEDULE A
Duties and Compensation for The Manager of
The Manager will be responsible for, but not limited to the following duties:
A. Supervise the workers at the Semiahmoo Wellness Center
B. Attend office and management meetings.
C. Write performance reviews for the workers under his supervision.
D. Attend to and perform treatments for the patients of the clinic.
' E. Supervise the daily operations of the clinic.
The manager shall receive compensation for performing his duties listed above as
the terms and conditions of his Contract for Hire Private (Free Agent) Agreement.
APPEN DiXC
Private Contract INVOICE
William Russeli Date: Mar 15, 2011
Ave. INVOICE#
White Rock, BC
Bill to: DR. WILLIAM RUSSELL NATUROPATHIC INC
, Surrey, BC V4A
TOTAL
MONTH
For services rendered to help Company become profitable. 00.00
Mar 1- Mar 15
TOTAL PAYABLE $ 0.00
William Russell is a private person working for his own benefit in a private capacity without an
expectation or intention of profit. No GST charged as of Sec 240 (1) of the Excise Tax Act as activity was
performed without intent to profit. Make all cheques payable to William Russell.
APPENDIX D
Ms Janny Ng, C.G.A. February 26, 201^
Audit Division, Section 442-01

Canada Revenue Agency
P.O. Box Stn Main
9737 King George Boulevard
Surrey, BCV3TSWS
Dear Ms. Ng
Your letter dated January 28,2014 was received regarding the completion of your audit of William
Russell. Inthat Setter you made some incorrect assumptions. I will not list them all here but draw a few
to your attention; Ireserve the rightto add and amend items later.
One, you assumed that William Russell was always a source, but in fact this was only while as
shareholder or as Director of Dr. WILLIAM RUSSELL NATUROPATHIC INC. ("Corporation").
Second, you assumed all revenue is from sources. However, CRA's TD-1312 course, The Net Worth
Method by Barry Casselman and Layne Wilson discusses the probative value of a person's "bank records,
credit card records, investment records and records of major purchases and expenses":
What is ihe probative value of these documents in proving thesefacts?
- In and of themselves, these documents have no probative value to prove that the increase in
net worth represents income, and if it is, whether it is taxable
. They only have probative value to show that the accused received and spent monev - whether the monev
Wqs income and if so, taxable, is not addressed bv 'he documents
The Corporation paid $ in 2010, $ ,000 in 2011,and $ 000 in 2012 to the taxpayer for
working as its Manager. This was not fTA "employment" or being ITA "employed", or as shareholder or
Director, as the amounts were by the individual who declined to be a source while as Manager.
Since I declined the ITA's deeming to be a source while as Manager, I received ITA "exempt income
instead of taxable or non-taxable income. The written Agreement with the Corporation states that the
Manager declined to be a CPP/ITA "officer with a social insurance number holding an office of profit.
While as Manager, I was not a CPP or GST "officer" either, since those are the same as the ITA officer.
As aTl is for filing income only from sources, there is no line on the Tito file a n y exempt income. I
believe that Ifiled all income from all sources (ie„ director's fees) butcouid not file the exempt income,
which is also deemed by ITA Part Ito be equal to zero.There are no grounds for your proposed
"UnreportedBusiness Income"or penalties, asthere is no unreported incomeforthe individual as
Manager, but instead only exempt income, which is sanctioned by the ITA and by Tito not be reported.
You never saw the documentary evidence such as the bills (which also state that the taxpayer, while as
Manager declined to be a source) or the Agreement before sending the Proposal. The authorized
represeniative had made these bills available to you. Copies of the bills and the Agreement are available
upon request.
Zls Lfv
Third, you assumed in the unfinished initial interview with my representative, Sandra Gibbs of Counung
on Us, that Ms. Gibbs spoke on my beha-if as the Corporation shareholder. She in fact spoke on my
behalf only as an ITA "legal representative" of the taxpayers as an individual and for the Corporation.
Since documentary evidence exists that the Manager declined to be a source; CRA has no evidence that
the shareholder performed duties other than at shareholder's meetings and taking risk with capital; the
individual as a source while as Director filed that income; and "significant amounts were paid to the
taxpayer" while not a source, there is no support for your Schedule III proposal to assess certain items as
benefits for a shareholder, an officer in an office of profit designated by a social insurance number.
Yours Truly
William Russell
As " legal representative" of the CPP/ITA "officer" and of the Corporation
rmrroggBgES REGISTERED RECOMMANDE | . J

nfrmnc ihtcdicud I m
DOMESTIC REGIME 1NTER1EUR
CUSTOMER RECEIPT HECU DU CLIENT
Destinateire
CQNFOTfiSATtOH
U5 FOR DELIVERY
CONRRKMtON OElAtltfRAISON'
W>x:'
33GS6584 (1104;
m i D U! s RW S69 259 CA

Tab F
Russell’s
Book of Authorities
for
Notice of Objection

Russell’s Notice of Appeal

Book of Authorities

1) The Queen v. The Canada Broadcasting Corporation, [1957] O.J. No. 655

2) The Composition of Legislation, Elmer Driedger, 2nd Ed., 1976, Department
of Justice, Ottawa

3) CRA website’s description of the Social Insurance Number

4) CRA website’s description of the “social insurance number”

5) 373409 ALBERTA LTD. V. BANK OF MONTREAL, 2002 SCC 81

6) Department of Justice Financial Administration Act Commentary, 1994

7) R. v. Porisky and Gould, 2012 BCSC 67

8) CRA Press Release on Stanchfield plea-bargain, November 26, 2015

9) Sandra June Gibbs v. Regina, 2006 BCSC 481

10) HMTQ v. Redpath Industries and Dominion Sugar Company Ltd., 84 DTC
6349
Page 1
Russell’s Book of Authorities - Tab 1
The Queen v. The Canadian Broadcasting Corporation.
[1957] O.J. No. 655
[1958] O.R. 55
120 C.C.C. 84
58 CLLC 796
58 CLLC para. 15,364 at 796 p
27 C.R. 165
Ontario
Court of Appeal
Laidlaw, Roach, Mackay, Schroeder and Lebel JJ.A.

and 25, 26th
W.B. Williston, Q.C., for the appellant:-- The C.B.C. is an agent of the Crown and the funds of the
Corporation are the property of Her Majesty: The King v. The City of Montreal, [1945] S.C.R. 621,
[1945] 4 D.L.R. 225; Montreal v. Montreal Locomotive Works Ltd. et al., [1947] 1 D.L.R. 161,
[1947] 3 W.W.R. 748; The Lord's Day Act, R.S.C. 1952, c. 171, s. 2(d), s. 4, s. 11, s. 11 (t); The
Interpretation Act, R.S.C. 1952, c. 158, s. 16; Criminal Code, s. 2(15). The learned Chief Justice of
the High Court was wrong in two respects: 1. In holding that the Parliament of Canada had provided
that The Lord's Day Act, applied to Her Majesty and so a fortiori to the C.B.C. 2. In holding that the
C.B.C. can be prosecuted in its individual capacity. The C.B.C. can act only as an agent of Her
Majesty. For Her Majesty to be bound by a statute, the statute must so state explicitly: Magdalene
College, Cambridge (1615), 11 Co. Rep. 66(b), 77 E.R. 1235 was overruled by Province of Bombay
v. Municipal Corporation of the City of Bombay, [1947] A.C. 58 at 62. [LAIDLAW J.A.: Why do
you say that The Lord's Day Act binds Her Majesty by inference only, when it is expressly stated
that "a person" is bound and "person" is defined to include Her Majesty?] Because of s. 16 of The
Interpretation Act. Her Majesty cannot be bound by the definition section. In The Income Tax Act
some sections include Her Majesty and some do not: In Re Silver Bros. Ltd., [1932] A.C. 514 at
523; R. v. Pouliot (1888), 2 Ex. C.R. 49 at 59; Re W. (1925), 56 O.L.R. 611 at 613, [1925] 2 D.L.R.
1177; R. v. Rhodes, [1934] O.R. 44, 61 C.C.C. 3, [1934] 1 D.L.R. 251. Immunity from prosecution
is a prerogative right: Cushing v. Dupuy (1880), L.R. 5 App. Cas. 409; Weymouth v. Nugent
(1865), 6 B. & S. 22. While the rights and liabilities of the Crown are to be determined by the law in
force at the time, no enactment will reduce the rights, affect the immunities, impose penalties on or
add to the liabilities of the Crown, unless it so provides.
Page 2
In the Criminal Code, s. 2(15), "person" is defined to include Her Majesty and to make criminal of-
fences applicable when Her Majesty or her property is affected. However, it is not intended to im-
pose criminal responsibility on such a person: s. 2(41). The fact that "person" is defined to include
Her Majesty does not mean that the statute is intended to affect the rights of Her Majesty or that the
restrictions in the statute are meant to apply to Her Majesty: Cain v. Doyle (1946), 72 C.L.R. 409 at
417, 424 and 425. The learned Chief Justice of the High Court distinguished this case improperly:
Cain v. Doyle, supra, at 417; Cooper v. Hawkins, [1904] 2 K.B. 164; Boarland v. Madras Electric
Supply Corp. Ltd., [1954] 1 All E.R. 52 at 56; Madras Electric Supply Corp. Ltd. v. Boarland,
[1955] 1 All E.R. 753, [1955] A.C. 667; Forbes v. Attorney General for Manitoba, [1937] A.C. 260.
The Crown may be a "person" within the definition section or at common law but that does not
mean that the rights of the Crown are affected or that a duty is imposed. If a statute does not bind
the Crown, then it does not apply to an agent of the Crown: Cooper v. Hawkins, supra; The Com-
missioners of His Majesty's Works & Public Buildings v. Pontypridd Masonic Hall Company Ltd.,
[1920] 2 K.B. 233. There are examples of statutes imposing penalties which have been held not to
apply to the Crown or its agent: R. v. Berriman, [1883] O.J. No. 128, 4 O.R. 282 at 289 and 292; R.
v. Rhodes, supra; R. v. LeBlanc (1930), 1 M.P.R. at 28; R. v. Marsh (1909), 39 N.B.R. 329 at 334;
Sheehan v. Shaw, 49 C.C.C. 357 at 365, [1928] 2 D.L.R. 468. [MACKAY J.A.: Are there any cases
in which the Crown has been made criminally responsible?] Counsel have found none. [LAIDLAW
J.A.: There is a case in my mind which might have some application: Peccin v. Lonegan and T.N.O.
Railway Commission, [1934] O.R. 701, [1934] 4 D.L.R. 776]. Counsel also referred to Tamlin v.
Hannaford, [1950] 1 K.B. 18 per Denning J. at p. 25.
C.F.H. Carson, Q.C., and C.R. Magone, Q.C., for the
Attorney-General of Ontario: The appellant bases its case on the
proposition that Her Majesty is not bound having regard to s. 16
of The Interpretation Act, supra. It is expressly stated in the
Criminal Code that Her Majesty is bound thereby. [ROACH J.A.:
That section does not say so in terms.] There is a distinction
between Her Majesty's personal capacity and that of her servants
and agents. The appellant's memorandum states that: "the term
'person' is used in many instances in The Criminal Code when it
is not intended thereby to impose criminal responsibility on
such a person". But that is not the way it is set out in the
definition section. The sections begin with the word "everyone",
which includes "Her Majesty", if she is capable of committing
the crime. A corporation is not capable of committing bigamy,
perjury or of making a false statement to obtain a passport. The
word "person" is not the only one which may include Her Majesty,
the word "everyone" may also do so. The word "expressly" has
been discussed in many cases: Chorlton v. Lings (1868), L.R. 4
C.P. 374 at 387 and 393; The Directors & the Metropolitan
District Railway Company v. Sharpe (1880), 5 App. Cas. 425 per
Lord Blackburn at 441; Re Fasken, [1952] O.J. No. 465, [1952]
O.R. 802 per Roach J.A. at 820; re Fasken, [1953] 2 S.C.R. 10
per Rand J. at 16, [1953] 3 D.L.R. 431. "Expressly" does not
mean it must be said in terms, provided the meaning is clear.
These Acts must be read together. There was a clear intention
Page 9
of The British North America Act, 1867 in the matter of "The Criminal Law, except the Constitu-
tion of Courts of ...": The Attorney-General for Ontario v. Hamilton Street Railway, supra. It is a
criminal offence to do any act prohibited by s. 4 of that Act, and any person bound by that enact-
ment is liable on summary conviction to a fine as provided in ss. 12, 13 and 14 of the Act; thus if
Her Majesty is bound by s. 4, she is liable upon summary conviction in the criminal courts of this
province to the penalty of a fine.
At common law:--
the general rule clearly is, that although the King may avail himself of the provi-
sions of any Acts of Parliament, he is not bound by such as do not particularly
and expressly mention him.
Prerogatives of the Crown, by Chitty, p. 382. It is stated that there is an important exception to that
rule, namely:--
... that the King is impliedly bound by statutes passed for the public good; the re-
lief of the poor; the general advancement of learning, religion and justice; or to
prevent injury or wrong.
At p. 383 the learned author proceeds to say:--
But Acts of Parliament which would divest or abridge the King of his preroga-
tives, his interests or his remedies, in the slightest degree, do not in general ex-
tend to, or bind the King, unless there be express words to that effect.
13 The position which the King and his prerogative held in the common law is summarized in
Blackstone's Commentaries. In the 16th and early 17th centuries the law invested the King with a
political capacity as well as a natural capacity, and the prerogatives of the Crown were then given
modern shape. While it has been stated that the King is subject to the law, (Book 1, pp.231 et seq.),
(see also Holdsworth, History of English Law, vol.III, p.458) nevertheless the person of the Sover-
eign was clothed by law with absolute perfection. The Sovereign was regarded in law as being inca-
pable of thinking wrong or meaning to do an improper act: Book 1, p. 246. It has been stated also,
Book 1, p.244:--
The supposition of law therefore is, that neither the King nor either house of par-
liament, collectively taken, is capable of doing any wrong: since in such cases the
law feels itself incapable of furnishing any adequate remedy.
It became an established maxim of the common law that the King can do no wrong. That maxim
does not mean that the King (presently the Queen) cannot be bound by an Act of Parliament or sub-
jected to liability. Indeed, there are many Acts binding on Her Majesty's servants and agents by ex-
press consent of Her Majesty that she is bound thereby. The maxim is "simply the application of the
ordinary ancient rule that a Lord cannot be sued in his own Court." (History of English Law, by
Holdsworth, vol.III, p. 462.)
Page 17
No provision or enactment on any Act affects, in any manner whatsoever, the

rights of Her Majesty, her heirs or successors, unless it is expressly stated therein
that Her Majesty is bound thereby.
34 The C.B.C. is a body corporate created by the Canadian Broadcasting Corporation Act, R.S.C.
1952, c. 32, with a corporate capacity to carry on a national broadcasting service within Canada. A
number of provisions of that Act will later be referred to by me but for the moment it will suffice to
quote only s. 4(2). It is as follows:--
The Corporation is for all purposes of this Act an agent of Her Majesty and its
powers under this Act may be exercised only as an agent of Her Majesty. Coun-
sel for the appellant submitted that The Lord's Day Act does not apply to and is
not binding on Her Majesty and therefore, so he urged, it does not apply to nor is
it binding on the C.B.C. which can only exercise the powers conferred on it as an
agent of Her Majesty.
35 It is important that at the outset we should understand the connotation of the words "Her Maj-
esty" in the Act. When Parliament names Her Majesty in a statute it means Her Majesty, not in her
capacity as a natural person but in her capacity as a corporation sole, a persona ficta. In Salmond on
Jurisprudence, 9th ed. at p. 444, the author refers to this dual capacity as follows:--
He (the King) has a double capacity, being not only a natural person but a body
politic, that is to say, a corporation sole. The visible wearer of the crown is mere-
ly the living representative and agent for the time being of this invisible and un-
derlying persona ficta, in whom by our law the powers and prerogatives of the
government of this realm are vested.
36 It is in that capacity that the Queen as sovereign, exercises her executive powers. The statute
that regulates the conduct of persons within Canada, -- in the instant case, The Lord's Day Act, --
could have no application to natural persons outside of Canada and therefore would not apply to
Her Majesty in her capacity as a natural person because in that capacity she is outside of Canada.
The legal fiction which recognizes this duality of persons in Her Majesty must also recognize that in
her capacity as a corporation sole Her Majesty at all times is in every part of her realm. In those
parts of her realm in which she is not physically present she is represented by her constitutional
agents.
37 In my opinion The Lord's Day Act does apply to and is binding on Her Majesty because the
Act expressly says so. I want it well understood that when throughout these reasons I say that the
Act applies to and is binding on Her Majesty, I mean only this, that Parliament which under the
constitution is supreme in the legislative field, has thereby laid down a law to be observed by Her
Majesty as well as by her subjects in Canada and I am not referring to the penalties thereby author-
ized for its nonobservance because as it will later appear, there are procedural difficulties in the way
of enforcing those penalties as against Her Majesty. It was not necessary, in order to have in The
Lord's Day Act itself the same definition of "person" as is contained in the Criminal Code, that Par-
liament repeat in that Act the words of definition as they are in the Code. The method adopted by
Parliament is equally as effective as far as compliance with s. 16 of The Interpretation Act is con-
THE COMPOSITION
OF LEGISLATION
LEGISLATIVE
FORMS AND PRECEDENTS
BY
ELMIR A. DRIEDGER, Q.C., B.A., LL.B., LL.D.
OI I in? BARS OF SASKATCHEWAN AND ONTARIO
PROFESSOR OI LAW, UNIVERSITY OF OTTAWA
ONETIME DEPUTY MINISTER OF JUSTICE AND
DEPUTY ATTORNEY GENERAL OF CANADA
SECOND EDITION, REVISED
PUBLISHED BY
THE DEPARTMENT OF JUSTICE
OTTAWA
C HAPTER VI
DEFINITIONS
The principal function of a definition section is to clarify the statute by
assigning statutory meanings to words and expressions found therein. An
other important function is to shorten and simplify the statute and its pro
visions. The following examples illustrate the various uses of definition
provisions.
TO DELIMIT
Many definitions are intended to set the limits of meaning, without
altering the normal meaning.
''subsidiary coin" means a coin other than a gold coin.
"property" means real or personal property.
"aircraft" means any machine used or designated for navigation of the air.
"invention" means any new and useful art, process, machine, manufacture
or composition of matter, or any new and useful improvement in any an,
process, machine, manufacture or composition of matter.
I "disabled" means incapable of pursuing regularly any substantially gainful
occupation.
"salary" means the compensation received for the performance of the reg
ular duties of a position or office.
"Canadian citizen" means a person who is a Canadian citizen within Ilu*
meaning of the Canadian Citizenship Act.
"advertise" means to make known by the publication or distribution of any
advertisement, circular or other notice.
"highway" means any public road, street, lane or other public way or
communication.
TO NARROW
A definition may narrow the ordinary meaning of a word. Things ni di
narily included are excluded, either by setting limits or by expressly
excluding.
"dividend " does not include a slock dividend.
"rank" means substantive rank or appointment, but does not include acting
rank.
"grain " means wheal, oats, barley and rye.
"oil" means any liquid hydrocarbon.
I >I I INI I I< >NS
I III' ('OMPOSI I ION OI' I I < ilSI A I K )N
TO PARTICULARI/l (i IN IK A I I )IS< U 11' IK INS
"wares" includes punted publications.
land" includes mines, minerals, easements, servitudes and all other inter
A definition may restrict a word to a particular tiling wilhoul chanîn/»,
ests in real properly.
ordinary meaning.
TO AHUKIVVIA IT; OR TO SHORTEN AND SIMPLIFY COMPOSITION
"contract" means a contract made before the 1st day of.lanuary, 1955.
Definitions arc commonly used to abbreviate, particulary names of cor
"notes" means notes of the Bank of Canada payable to bearer on demand
and intended for circulation. porations, officials, bodies, etc. Thus, Commission may be defined to mean
Unemployment Insurance Commission; Corporation to mean the Canadian
"agreement" means an agreement made under section 3.
Overseas Telecommunication Corporation; Minister to mean the Minister of
"widow" means a widow of a veteran. Public Works; Board to mean the Board of Directors. Definitions are also
used to define verbs, things and expressions for the purpose of simplifying
TO ENLARGE
construction.
A definition may retain the ordinary meaning of a word and add a "Convention" means the International Convention for the Northwest At
waning it does not normally have. lantic Fisheries set out in the Schedule.
"lease" includes an agreement for a lease. "trafficking" means the importation, exportation, manufacture, sale, giving,
"servant" includes agent. administering, transportation, delivery or distribution by any person of a
drug or any substance represented or held out by such person to be a drug,
" money" includes negotiable instrument. or the making of any offer in respect thereof, but does not include
"fish" includes shell fish, crustaceans and marine animals. (i) the importation or exportation of any drug by or on behalf of any
Occasionally the included meaning is virtually exhaustive. person who has a licence therefor under section 3, or
(ii) the manufacture, sale, giving, administering, transportation, deliv
"intoxicant" includes alcohol, alcoholic, spirituous, vinous, fermented malt ery or distribution of a drug, or the making of any offer in respect
or other intoxicating liquor or combination of liquors and mixed liquor a thereof, by or on behalf of any person who has a licence therefor
part of which is spirituous, vinous, fermented or otherwise intoxicating and under section 3, or by or on behalf of a physician, dentist, veteri
all drinks, drinkable liquids, preparations or mixtures capable of human nary surgeon or retail druggist for a medicinal purpose.
consumption that are intoxicating.
"law of the province" means a law of a province or municipality not repug
ie above definition seems to include everything that is included in the
nant to or inconsistent with this Act.
rmal meaning. Includes rather than means is used to catch anything that
"unsanitary conditions" means such conditions or circumstances as might
dn't happen to come to the draftsman's mind; he has therefore protected
contaminate a food, drug or cosmetic with dirt or filth or render the same
mself against oversight. Similarly, in the following examples:
injurious to health.
"rodent" includes all members of the order Rodentia. "apply" includes to apply or attach to, or to use on, in connection with, or in
"mark" includes mark, sign, device, imprint, stamp, brand, label, ticket, relation to, an article by any method or means, whether to, on, by, in, or with
letter, word or figure.
(i) the article itself,
TO SETTLE DOUBTS
(ii) anything attached to the article,
(iii) anything to which the article is attached,
There are cases where there may be doubt whether a word means a
(iv) anything in or on which the article is, or
rticular thing. Includes is used, but rather than add a meaning it serves to
(v) anything so used or placed as to lead to a reasonable belief that the
.tie the doubt. For example —
mark on that thing is meant to be taken as a mark on the article
"securities" includes bonds, debentures and obligations, secured or unse itself.
cured, whether issued within or outside Canada, and rights in respect of "sell" includes to dispose of for valuable consideration, to offer to sell, to
such bonds, debentures and obligations, but does not include shares of distribute or offer as premiums or prizes, to offer to dispose of for valuable
capital stock of corporations or rights in respect of such shares. consideration, to have in possession with intent to sell or intent to dispose of
"highway" includes any public road, street, lane or other public way or for valuable consideration and to display in such manner as to lead to a
communication. reasonable belief that the article is intended for sale.
"unmarried person" includes a widow, a widower and a divorced person, "Member" means a member of the House of Commons.
"child" includes a natural child, stepchild or adopted child. "officer" means a commissioned officer.
46 47
THE COMPOSITION OF LEGISLATION DEFINITIONS
"agricultural equipment" means implements, apparatus, appliances and
Definitions should not be inserted unless they are needed. Frequently a
machinery, of any kind usually affixed to real or immovable property, for
use on a farm, but does not include a farm electric system. word or expression cannot be exactly defined and the presence of a definition
may cause more difficulties in construction than its absence. In many cases
we have a restrictive definition followed by an exclusion. the dictionary meaning is adequate and the exact interpretation of the word
"cattle" means neat cattle or an animal of the bovine species by whatever or expression can safely be left to the courts.
technical or familiar name it is known, and includes a horse, mule, ass, pig,
sheep or goat. The definition technique can usefully be employed to make a sentence
more comprehensible by removing lengthy descriptive material from the
is again a double definition. There could be, for example, a definition of
case so as to expose more prominently the main subject and predicate. In one
al as meaning cattle, horse, mule, etc. followed by a definition of cattle to
section of the Official Secrets Act, for example, there are fifteen lines of type
i neat cattle or an animal of the bovine species.
describing the information to which the section applies. A defined expres
"highway" means a road to which the public has the right of access, and
includes bridges over which or tunnels through which a road passes. sion, such as "official secret", could be substituted for this descriptive mate
rial, thus cutting the length of the section in half, and making it more pre
n, a double definition.
sentable. In situations such as this, where an expression is devised for a
IN RELATION TO specific purpose, the expression chosen should be one that, apart from the
Words in addition to means or includes may be used to introduce a definition, will convey to the reader the general idea of the definition.
ition. There are instances where a word is to have a special meaning in Generally speaking, it is better to write the sentence in complete form first,
ase, and its ordinary meaning in other cases. than to start with an artificial definition and build a sentence around it. The
"title" in relation to a loan secured by a mortgage on a longterm lease draftsman might then see that a better way to make the provision more
means the entire interest of the lessee. presentable would be to recast its grammatical form, or divide it into two
"distinctive" in relation to a trade mark means a trade mark that actually or more sections or subsections.
distinguishes the wares or services in association with which it is used by its
owner from the wares or services of others or is adapted so to distinguish
them.
')r a word may have two defined meanings for two situations.
"recorded address" means
(i) in relation to a person as a shareholder, his last known post office
address according to the share register of the bank, and
(ii) in relation to a person in any other respect, his last known post
office address according to the records of the branch concerned.
\ common phrase for these situations is in relation to. Other expressions,
i the case of are also used.
"resident of Canada" means, in the case of a natural person, a person who
ordinarily resides in Canada and, in the case of a corporation, a corporation
having iis head office in Canada or operating a branch office in Canada.
donally one linds in its application to or when referring to.
GFNHRAL
KTmitions should be listed in strict alphabetical order,
n the final draft of a bill, the definitions should be carefully examined to
any are unnecessary. Sometimes ;i definition is inserted for a section
s dropped in the draft in;', stages.
vVhere a definition is used only in another 1 deli nil ion, an effort should be
to combine them into one
Ml '> I
THE COMPOSITION OP' LEGISLATION WORDS AND EXPRESSIONS
Assent To assent to. Subordinating conjunctions are used to join dependent clauses, especially
Attach — To attach to. adverbial clauses expressing the case — reason, time, place, conditions, etc. The
principal subordinating conjunctions are after, although, as, as if as long as, as
Because May imply reason, sake, purpose. By reason of, for the reason that, on the often as, as soon as, as though, before, for the purpose of if, in case, in order that,
ground that or similar expressions are generally better. See By reason only. There notwithstanding, so that, such as, unless, until, when, where, while, with a view to.
is ambiguity with a negative. Thus, He did not fail because can mean either that Correlative conjunctions come in pairs; not only...but also; (hough...yet;
he succeeded for the stated reason, or that he failed but not for the stated reason. whether...or; either...or; neither...nor; both... and; so...as; if...then; as...as.
Belong — To belong to.
The pronouns who, which, what, that also have conjunctive uses.
Bestow — To bestow on or upon. Some adverbs serve as subordinating conjunctions — nevertheless, notwith
Bind, bound To be bound to do something; to bind by agreement; an agreement is standing, accordingly, moreover, therefore — but must be preceded by a semico
binding upon or on a person. lon or other stop of higher value, or, in some cases, by a regular conjunction.
Border — On, upon. Consent — To consent to.
But so that — To introduce a predicate modifier specifying the mode in which some Consign — To consign to.
thing is to be done. Thus, to divide between A, B, and C, but so that each receives Consist — To consist in (to have its being in); to consist of {to be made up by or
at least a quarter. But not but so that A receives nothing. composed of).
By reason only Frequently more precise than because. To say a person is ineligible Consistent — To be consistent with.
by reason only of age implies that on all other counts he is eligible; to say he is Contained — In expressions like Notwithstanding anything contained in this Act the
ineligible because of age merely specifies one ground of ineligibility and does not word contained can be omitted. Contained in this Act is usually better than in this
necessarily exclude other possible grounds. Because only will hardly do, and only Act contained.
be cause might in cei tain contexts mean for the sake of or for the purpose of. Contend — To contend with or against (struggle); to contend about (argue).
Capable — To be capable of. Contiguous — To be contiguous to.
Care — To care/bra thing. Contrary — To be contrary to.
Charge on a fund, against a person, with an offence, to an account. Convict — To convict of an offence.
Coincide — To coincide with. Correspond — Correspond to (similar in character or function); correspond with
Collective nouns A collective noun is singular even though it comprises more than (a g re e m e n t, h a r m o n y).
one. 7 he committee has power. But usages difler. In Britain government is plural, Convenant — With a person; for a thing.
but singular in Canada.
Deal — To deal in a thing; with a person.
Communicate — Communicate information to a person; communicate with a person.
Debar — To debar/raw.
Compare — To compare to (quality); compare with (illustration).
Deemed — Used to establish legal fictions. For a statutory purpose it is often necessary
Comply Comply and compliance with. to deem a thing to be something it is not. Also used negatively to declare that a
Composed — To be composed of. thing is not something it is, but the difference between shall not be deemed and
Compound subjects Normally a compound subject takes a plural verb. The Minis shall be deemed not should be noted. Shall not be deemed should be used only
tet and his Deputy are authorized. But there are difficulties where two combined where a previous deeming is denied; shall be deemed not is used to establish a
nouns may form a single concept. The ship and cargo is (are?) forfeited. Rc negative fiction that can stand on its own feet.
gaided as one entity, the verb should be singular; regarded as separate, it should Also used in the sense of considering — as he deems necessary.
be plural. Defend, Defence — Defend or defence against a claim; defend /><?/;? danger.
Concede — To. Deficient, Deficiency — A deficiency of an amount; in an account: deficient in.
Conceive — Of. Defraud — To defraud a person of a thing.
Concur — With a person; in a course of action. Demand — To demand of
Confer To confer on or upon a person (bestow); to confer with (discuss). Depend — To depend ( be dependent) on or upon.
Conform — To conform to. Deprive — To deprive a person of a thing.
Conjunctions The principal coordinating conjunctions encountered in legislation Derogate — To derogatefrom.
are and, but, or, nor. Coordinating conjunctions join sentence elements of equal Desirous — To be desirous of.
value.
132 133
icnl To assent to. Subordinating conjunctions are used to join dependent clauses, especially
adverbial clauses expressing the case reason, time, place, conditions, etc. The
ach — To attach to.
principal subordinating conjunctions are after, although, as, as if as long as, as
:ause — May imply reason, sake, purpose. By reason of, for the reason that, on the often as, as soon as\ as though, before, for the purpose of if, in case, in order that,
ground that or similar expressions are generally better. See By reason only. There notwithstanding, so that, such as, unless, until, when, where, while, with a view to.
is ambiguity with a negative. Thus, He did not fail because can mean either that Correlative conjunctions come in pairs; not only...but also; though...yet;
he succeeded for the stated reason, or that he failed but not for the stated reason, whether...or; either...or; neither...nor; both... and; so...as; if...then; as...as.
ong — To belong to. The pronouns who, which, what, that also have conjunctive uses.
;to\v — To bestow on or upon. Some adverbs serve as subordinating conjunctions — nevertheless, notwith
d, bound — To be bound to do something; to bind by agreement; an agreement is standing, accordingly, moreover, therefore but must be preceded by a semico
binding upon or on a person, lon or other stop of higher value, or, in some cases, by a regular conjunction.
der — On, upon. Consent — To consent to.
so that — To introduce a predicate modifier specifying the mode in which some Consign — To consign to.
thing is to be done. Thus, to divide between A, B, and C, but so that each receives Consist — To consist in (to have its being in); to consist of (to be made up by or
at least a quarter. But not but so that A receives nothing, composed of).
reason only — Frequently more precise than because. To say a person is ineligible Consistent — To be consistent with.
by reason only of age implies that on all other counts he is eligible; to say he is Contained In expressions like Notwithstanding anything contained in this Act the
ineligible because of age merely specifies one ground of ineligibility and does not word contained can be omitted. Contained in this Act is usually better than in this
necessarily exclude other possible grounds. Because only will hardly do, and only Act contained.
because might in certain contexts mean for the sake of or for the purpose of. Contend — To contend with or against (struggle); to contend about (argue).
table — To be capable of. Contiguous — To be contiguous to.
e — To carz for a thing. Contrary — To be contrary to.
trge — on a fund, against a person, with an offence, to an account, Convict — To convict of an offence.
Correspond Correspond to (similar in character or function); correspond with
ficide — To coincide with.
(agreement, harmony).
lective nouns — A collective noun is singular even though it comprises more than
Convenant — With a person; /bra thing.
one. The committee has power. But usages differ. In Britain government is plural,
but singular in Canada. Deal To deal in a thing; with a person.
imunicaie — Communicate information to a person; communicate with a person, Debar — To debar/>ww.
lpare To compare to (quality); compare with (illustration), Deemed Used to establish legal fictions. For a statutory purpose it is often necessary
lply — Comply and compliance with. to deem a thing to be something it is not. Also used negatively to declare that a
lposed — To be composed of. thing is not something it is, but the difference between shall not be deemed and
shall be deemed not should be noted. Shall not be deemed should be used only
lpound subjects — Normally a compound subject takes a plural verb. The Minis where a previous deeming is denied; shall be deemed not is used to establish a
ter and his Deputy are authorized. But there are difficulties where two combined
negative fiction that can stand on its own feet.
nouns may form a single concept. The ship and cargo is (are?) forfeited. Re
Also used in the sense of considering as he deems necessary.
garded as one entity, the verb should be singular; regarded as separate, it should
be plural, Defend, Defence — Defend or defence against a claim; defend/row danger.
cede — To. Deficient, Deficiency — A deficiency 0/an amount; in an account; deficient in.
ceive — Of Defraud — To defraud a person of a thing.
cur — With a person; in a course of action. Demand — To demand of.
fer — To confer on or upon a person (bestow); to confer with (discuss), Depend — To depend (be dependent) on or upon.
form — To conform to. Deprive — To deprive a person of'& thing.
junctions — The principal coordinating conjunctions encountered in legislation Derogate — To derogate from.
are and, but, or, nor. Coordinating conjunctions join sentence elements of equal Desirous — To be desirous of.
value.
132 133
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312 373409 ALBERTA LTD. v. BANK OF MONTREAL [2002] 4 S.C.R.
Bank of Montreal Appellant Banque de Montréal Appelante
v. c.
Ernst & Young Inc., in its capacity as Ernst & Young Inc., en qualité de séquestre
Receiver and Manager of 373409 Alberta et d’administrateur de 373409 Alberta
2002 SCC 81 (CanLII)

Ltd. and Province of Alberta Treasury Ltd. et Province of Alberta Treasury
Branches Respondents Branches Intimées
Indexed as: 373409 Alberta Ltd. (Receiver of) Répertorié : 373409 Alberta Ltd. (Séquestre
v. Bank of Montreal de) c. Banque de Montréal
Neutral citation: 2002 SCC 81. Référence neutre : 2002 CSC 81.
File No.: 28607. No du greffe : 28607.
2002: October 1; 2002: December 12. 2002 : 1er octobre; 2002 : 12 décembre.
Present: Gonthier, Iacobucci, Major, Bastarache, Binnie, Présents : Les juges Gonthier, Iacobucci, Major,
Arbour and LeBel JJ. Bastarache, Binnie, Arbour et LeBel.
ON APPEAL FROM THE COURT OF APPEAL FOR EN APPEL DE LA COUR D’APPEL DE L’ALBERTA
ALBERTA
Banks and banking operations — Bills of exchange — Banques et opérations bancaires — Lettres de
Conversion — Sole shareholder and directing mind of change — Détournement — L’unique actionnaire et
A and B corporations altering cheque payable to A by l’âme dirigeante des sociétés A et B a modifié le libellé
adding B as a payee — Bank accepting unendorsed du chèque payable à A en y ajoutant B en qualité de
cheque for deposit in B’s account — Bank crediting B’s preneur — La banque a accepté le chèque non endossé
account and shareholder later withdrawing funds — pour le déposer au compte de B et l’actionnaire a par la
Whether Bank liable in conversion. suite retiré les fonds — La banque est-elle responsable de
détournement?
L was the sole shareholder, director and officer of two L était l’unique actionnaire, l’administrateur et le
corporations, A and B. L received a cheque payable to A, directeur de deux sociétés, A et B. L a reçu un chèque
but altered the cheque by adding B as a payee. L did not payable à l’ordre de A, dont il a modifié le libellé en y
endorse the cheque and deposited the altered cheque into ajoutant B en qualité de preneur. L n’a pas endossé le
B’s account at the appellant Bank. The Bank credited B’s chèque et il a déposé le chèque modifié au compte de B
account with the proceeds of the cheque and the funds à la banque appelante. La banque a crédité le compte de
were later withdrawn by L. A subsequently went into liq- B du montant du chèque et L a ensuite retiré la somme.
uidation, and its Receiver and Manager brought an action Subséquemment, A a fait l’objet d’une liquidation, et
in conversion against the Bank for having accepted an son séquestre et administrateur a intenté une action pour
unendorsed cheque for deposit into B’s account. The trial détournement contre la banque parce qu’elle avait accepté
judge held that the Bank was liable in conversion and le dépôt au compte de B d’un chèque non endossé. Le
could not avail itself of the defence provided by s. 165(3) juge de première instance a statué que la banque était
of the Bills of Exchange Act. A majority of the Court of responsable de détournement et qu’elle ne pouvait se
Appeal upheld the decision. prévaloir du moyen de défense prévu au par. 165(3) de la
Loi sur les lettres de change. Les juges majoritaires de la
Cour d’appel ont confirmé cette décision.
Held: The appeal should be allowed. Arrêt : Le pourvoi est accueilli.
The issue in this case is not whether A transferred La question en l’espèce n’est pas de savoir si A a
its title in the cheque to B, but rather whether the Bank cédé à B son droit sur le chèque, mais bien si la banque
dealt with the cheque on the authority of A. A lending a payé le chèque avec l’autorisation de A. Il ne peut y
[2002] 4 R.C.S. 373409 ALBERTA LTD. c. BANQUE DE MONTRÉAL 313
institution’s liability in conversion is predicated upon avoir détournement par une institution prêteuse que si le
finding both that payment upon the cheque was made chèque a été payé à une autre personne que son détenteur
to someone other than the rightful holder of the cheque, légitime et que ce dernier n’a pas autorisé ce paiement.
and that such payment was not authorized by the rightful Si l’une ou l’autre de ces conditions n’est pas remplie, il
holder. If either of these criteria is not satisfied, there is n’y a pas de délit. En l’espèce, par l’entremise de L, A a
no tort. Here, A, through L, authorized the Bank, as it was autorisé la banque, comme elle avait le droit de le faire, à
entitled to do, to deposit the cheque’s proceeds into B’s déposer le chèque au compte de B. Il n’y a donc pas eu,

account. As a result, the Bank did not wrongfully interfere de la part de la banque, d’ingérence illégitime à l’égard
with A’s cheque, as it did not deal with that cheque in a du chèque de A puisqu’elle n’a pas agi d’une manière
manner inconsistent with A’s instructions. Consequently, incompatible avec les instructions de A. Partant, la
the Bank is not liable in conversion to A’s Receiver and banque ne peut être tenue responsable du détournement
Manager for the proceeds of the cheque. The impropriety du montant du chèque vis-à-vis du séquestre et adminis-
of A’s diversion of funds from its creditors did not under- trateur de A. Bien qu’il ait été répréhensible de la part de
mine L’s authority to deal with those funds on behalf A de détourner les fonds au détriment de ses créanciers,
of A. L avait le pouvoir de gérer les fonds en question pour le
compte de A.
Cases Cited Jurisprudence
Referred to: Boma Manufacturing Ltd. v. Canadian Arrêts mentionnés : Boma Manufacturing Ltd. c.
Imperial Bank of Commerce, [1996] 3 S.C.R. 727; Banque Canadienne Impériale de Commerce, [1996] 3
Toronto-Dominion Bank v. Dauphin Plains Credit Union R.C.S. 727; Toronto-Dominion Bank c. Dauphin Plains
Ltd. (1992), 98 D.L.R. (4th) 736; Lennard’s Carrying Credit Union Ltd. (1992), 98 D.L.R. (4th) 736; Lennard’s
Co. v. Asiatic Petroleum Co., [1915] A.C. 705; Canadian Carrying Co. c. Asiatic Petroleum Co., [1915] A.C. 705;
Dredge & Dock Co. v. The Queen, [1985] 1 S.C.R. 662. Canadian Dredge & Dock Co. c. La Reine, [1985] 1
R.C.S. 662.
Statutes and Regulations Cited Lois et règlements cités
Bills of Exchange Act, R.S.C. 1985, c. B-4, ss. 59(3), Loi sur les lettres de change, L.R.C. 1985, ch. B-4,
165(3). art. 59(3), 165(3).
Authors Cited Doctrine citée
Bowers, Renzo D. A Treatise on the Law of Conversion. Bowers, Renzo D. A Treatise on the Law of Conversion.
Boston: Little, Brown, 1917. Boston : Little, Brown, 1917.
Crawford and Falconbridge: Banking and Bills of Crawford and Falconbridge : Banking and Bills of
Exchange: A Treatise on the Law of Banks, Banking, Exchange : A Treatise on the Law of Banks, Banking,
Bills of Exchange and the Payment System in Canada, Bills of Exchange and the Payment System in Canada,
vol. 2, 8th ed. by Bradley Crawford. Toronto : Canada vol. 2, 8th ed. by Bradley Crawford. Toronto: Canada
Law Book, 1986. Law Book, 1986.
Grubb, Andrew, ed. The Law of Tort. London: Grubb, Andrew, ed. The Law of Tort. London :
Butterworths LexisNexis, 2002. Butterworths LexisNexis, 2002.
APPEAL from a judgment of the Alberta Court POURVOI contre un arrêt de la Cour d’appel de
of Appeal (2001), 198 D.L.R. (4th) 40, 92 Alta. l’Alberta (2001), 198 D.L.R. (4th) 40, 92 Alta. L.R.
L.R. (3d) 280, 277 A.R. 211, 13 B.L.R. (3d) 165, (3d) 280, 277 A.R. 211, 13 B.L.R. (3d) 165, [2001]
[2001] 7 W.W.R. 638, [2001] A.J. No. 341 (QL), 7 W.W.R. 638, [2001] A.J. No. 341 (QL), 2001
2001 ABCA 76, affirming a decision of the Court of ABCA 76, confirmant une décision de la Cour du
Queen’s Bench. Appeal allowed. Banc de la Reine. Pourvoi accueilli.
James K. McFadyen, for the appellant. James K. McFadyen, pour l’appelante.
Douglas N. Tkachuk and Kelsey Becker, for the Douglas N. Tkachuk et Kelsey Becker, pour les
respondents. intimées.
[2002] 4 R.C.S. 373409 ALBERTA LTD. c. BANQUE DE MONTRÉAL Le juge Major 315
Bills of Exchange Act, R.S.C. 1985, c. B-4 (the de la Loi sur les lettres de change, L.R.C. 1985,
“Act”). The trial judge also held that the Bank could ch. B-4 (la « Loi »). Le juge de première instance a
not avail itself of the defence provided by s. 165(3) également conclu que la banque ne pouvait se pré-
of the Act since the cheque was not deposited into valoir du moyen de défense prévu au par. 165(3) de
the account of a “person” within the meaning of that la Loi, le chèque n’ayant pas été déposé au compte
section. d’une « personne » au sens de cette disposition.

A majority of the Alberta Court of Appeal dis- Les juges majoritaires de la Cour d’appel de 6
missed the appeal ((2001), 198 D.L.R. (4th) 40). l’Alberta ont rejeté l’appel ((2001), 198 D.L.R.
Girgulis J. (ad hoc) (McClung J.A. concurring) (4th) 40). Le juge Girgulis (ad hoc) (avec l’accord
agreed with the reasons of the trial judge, and held du juge McClung) a fait siens les motifs du juge de
that the Bank was liable in conversion and could not première instance, et a conclu que la banque était
avail itself of the defence provided by s. 165(3) of responsable de détournement et ne pouvait invoquer
the Act. In dissent, Conrad J.A. held that the Bank le par. 165(3) de la Loi. Dissidente, madame le juge
was not liable in conversion because the deposit was Conrad a estimé qu’il n’y avait pas eu détourne-
made by a person entitled to possession and having ment, le dépôt ayant été effectué par une personne
authority to deal with the cheque, notwithstanding qui avait légitimement droit au chèque et qui était
the lack of formal endorsement. autorisée à le négocier, malgré l’absence d’endosse-
ment formel.
III. Issues III. Les questions en litige
7
1. Is the Bank liable in conversion to the Receiver 1. La banque s’est-elle rendue coupable de détour-
and Manager of 373409 for having deposited the nement vis-à-vis du séquestre et administrateur
proceeds of the cheque into Legacy’s account, as de 373409 en portant le montant du chèque au
authorized by Lakusta, the sole shareholder and crédit du compte de Legacy, comme l’y avait
directing mind of 373409? autorisée M. Lakusta, l’unique actionnaire et
l’âme dirigeante de 373409?
2. If so, can the Bank avail itself of the defence 2. Dans l’affirmative, la banque peut-elle se préva-
provided by s. 165(3) of the Act? loir du moyen de défense prévu au par. 165(3) de
la Loi?
IV. Analysis IV. L’analyse
A. The Tort of Conversion A. Le délit de détournement
8
The tort of conversion “involves a wrongful inter- Le délit de détournement « comporte une ingé-
ference with the goods of another, such as taking, rence illégitime dans les objets appartenant à autrui,
using or destroying these goods in a manner incon- comme le fait de prendre, utiliser ou détruire ces
sistent with the owner’s right of possession”: Boma objets d’une façon incompatible avec le droit de pos-
Manufacturing Ltd. v. Canadian Imperial Bank of session de leur propriétaire » : Boma Manufacturing
Commerce, [1996] 3 S.C.R. 727, per Iacobucci Ltd. c. Banque Canadienne Impériale de Commerce,
J., at para. 31. It has long been recognized that an [1996] 3 R.C.S. 727, le juge Iacobucci, par. 31. Il est
action in conversion may be brought by the right- depuis longtemps établi que le détenteur légitime
ful holder of a cheque against a wrongful dispos- d’un chèque peut intenter une action pour détour-
sessor: Crawford and Falconbridge: Banking and nement contre la personne qui l’en a dépossédé
Bills of Exchange (8th ed. 1986), vol. 2, at p. 1386 illégitimement : Crawford et Falconbridge :
(“Crawford and Falconbridge”). The tort is one of Banking and Bills of Exchange (8e éd. 1986), vol. 2,
strict liability, and although the dispossession must p. 1386 (« Crawford et Falconbridge »). Le délit en
316 373409 ALBERTA LTD. v. BANK OF MONTREAL Major J. [2002] 4 S.C.R.
arise as a result of the defendant’s intentional act, “it question en est un de stricte responsabilité, et bien
is no defence that the wrongful act was committed que la dépossession doive résulter de l’acte inten-
in all innocence”: Boma, supra, at para. 31. tionnel du défendeur, « l’on ne peut donc opposer,
comme moyen de défense, que l’acte illégitime a
été accompli en toute innocence » : Boma, précité,
par. 31.

9 An owner’s right of possession includes the right Le droit de possession du propriétaire comprend
to authorize others to deal with his or her chattel le droit d’autoriser autrui à agir d’une manière
in any manner specified. As a result, dealing with donnée à l’égard de son bien. Partant, agir à l’égard
another’s chattel in a manner authorized by the right- d’un bien d’une manière autorisée par son proprié-
ful owner is consistent with the owner’s right of pos- taire légitime est compatible avec le droit de pos-
session, and does not qualify as wrongful interfer- session de ce dernier et n’équivaut pas à une ingé-
ence. The principle is aptly stated in R. D. Bowers, A rence illégitime. Le principe est bien énoncé dans
Treatise on the Law of Conversion (1917), at § 10: l’ouvrage de R. D. Bowers, intitulé A Treatise on the
Law of Conversion (1917), par. 10 :
It will be noted that the deprivation must be wrongful, [TRADUCTION] Signalons que la dépossession doit
for without the element of wrong no tort can be com- être fautive, car il ne peut y avoir de délit sans faute ni,
mitted and conversion cannot occur; and to be wrong- par conséquent, de détournement. Pour qu’elle soit fau-
ful, it must be wholly without the owner’s sanction or tive, elle doit intervenir sans aucune approbation ni aucun
assent, either express or implied. So, where the owner assentiment, exprès ou tacite, du propriétaire. Lorsque ce
has given to another, or permitted him to have control of dernier accorde à un tiers la possession de son bien ou
the property, no one can be held responsible in tort for l’autorise à le posséder, celui qui s’en tient à cette utili-
its conversion who merely makes such use of the prop- sation du bien ou qui n’exerce à son égard que le pouvoir
erty or exercises such dominion over it as is warranted qui lui a été conféré ne peut être tenu délictuellement
by the authority thus given. Otherwise expressed, it has responsable de détournement. En d’autres termes, l’ingé-
been said that a rightful interference with the chattels of rence légitime à l’égard du bien d’autrui ne saurait cons-
another cannot constitute a conversion. [Footnotes omit- tituer un détournement. [Notes en bas de page omises.]
ted.]
The principle is reiterated in A. Grubb, ed., The Law Ce principe est repris dans l’ouvrage de A. Grubb,
of Tort (2002), at para. 11.170: dir., intitulé The Law of Tort (2002), par. 11.170 :
No action lies in conversion or trespass to chattels for [TRADUCTION] Une action pour détournement d’un
consensual interferences with goods: the nature of these bien ou atteinte à sa possession ne peut être intentée lors-
torts involves wrongful interference with goods and an qu’il y a eu consentement à l’ingérence : la nature de ce
interference that is consented to cannot be wrongful. délit suppose une ingérence illégitime à l’égard du bien,
Consent may be express, as in a contract or agreement et une ingérence consensuelle ne saurait être illégitime.
for bailment or lease, or it may be implied from the cir- Le consentement peut être exprès, comme dans un con-
cumstances. [Emphasis in original.] trat ou une convention de bail ou de location, ou il peut
être déduit des circonstances. [Souligné dans l’original.]
10 Boma, supra, presented an entirely different fac- Dans Boma, précité, les faits étaient totalement
tual basis than the case at bar. There, a bookkeeper différents de ceux de la présente espèce. Une comp-
committed fraud against the companies she worked table avait fraudé les sociétés pour lesquelles elle
for by issuing a series of fraudulent cheques made travaillait en émettant une série de chèques frau-
payable to various individuals. The collecting bank duleux payables à diverses personnes. La banque
deposited the proceeds of the fraudulent cheques d’encaissement avait déposé le montant des chè-
into the bookkeeper’s account. Iacobucci J. cited (at ques frauduleux au compte de la comptable. Le juge
para. 36) with approval the following passage from Iacobucci a cité (au par. 36) en l’approuvant l’extrait
Crawford and Falconbridge, at p. 1386: suivant de Crawford et Falconbridge, p. 1386 :
DEPARTMENT OF JUSTICE
FINANCIAL ADMINISTRATION ACT
COMMENTARY
(REVISED)
Departmental Legal Services
December, 1994
Editor
Werner Heiss
Senior Counsel
Legal Services, Treasury Board
Department of Justice
Associate Editor
Henry L. Molot, Q.C.

Senior General Counsel
Administrative Law Section
Editorial Board
Richard Thompson, Q.C.

Senior Assistant Deputy Minister
Departmental Legal Services
Commercial and Property Law
^Department of Justice
Jean-Claude Demers, Q.C. Mark Jewett,Q.C.

Assistant Deputy Minister Assistant Deputy
Minister
Departmental Legal Services Department of
Finance
Department of Justice Department of
Justice
Konrad von Finckenstein, Q.C. John H.

Sims, Q.C.
AssiUftflft Deputy Minister Senior General
Counsel
Department of Industry Legal
Services, Treasury Board
Department of Justice Department of
Justice
Preface
This edition of the Commentary has been prepared in co-operation with the Department
of Justice, Legal Services Training and Development Advisory Committee and the
Treasury Board, Legal Services Unit. It represents a substantial update and revision of
the 1987 edition and reflects amendments made, to November 30, 1994, to the Financial
Administration Act and its regulations, and the evolution of related and relevant judicial
decisions since the last edition.
Needless to say the views and opinions expressed in the Commentary are those of the
authors and do not necessarily represent those of the Department of Justice or the
Editorial Board.
Again, every effort has been made to make this revision as complete as possible.
However, due to time constraints it is inevitable that inadvertent omissions may have
taken place. It would be appreciated if, as such omissions become apparent or errors are
discovered, they would be communicated to me.
It is expected that the Commentary will be made generally available, in the near future, by
electronic means that is accessible to all Department of Justice legal officers. In addition,
it is intended that the Commentary will be updated periodically both to keep it current and
to continue its revision, as may be appropriate.
This revision has been made possible due to the foresight and support of the members of
the Editorial Board, in particular, Richard Thompson, Jean-Claude Demers and
John Sims. I wish to particularly express my appreciation to them and to the other
members of the Board.
Needless to say, the revision could not have been realized without the co-operative effort
of a number of people. While space is insufficient to recognize all persons, I wish to
extend my appreciation, in particular, to the various contributors and authors who
laboured to revise and write the texts, Colleen Ulrich, my secretary, who co-ordinated the
preparation of the texts and their translation and without whose extensive efforts a final
text would not have been delivered, Dan Beriault who assisted in the research for a
significant number of the texts, and Jan Fraser who assisted with the endless
administrative tasks.
Werner W. Heiss
Contributors
The following list is to acknowledge the specific contributions made by the original
authors and contributors to the 1987 Commentary, and, the revisions and authors, as the
case may be, of the respective Part or section, as set out in this revised edition. The latter
amended.
Introduction
(by William G. Nelson)

Management ofpublicfunds is governed by a complex hierarchy of legal norms, from
constitutional rules to statutes and regulations and down to mere directives. 11
The Golden Thread
The legal principles of government finance form a "golden thread" 22 evolved from the
confrontation between the King of England and Parliament. That confrontation
culminated in the gradual restriction of the financial powers of the King, as exercised
personally and by his ministers, and served as a model for France, the United States,
Canada and most of the Commonwealth countries 33.
Conflicts over the authorization for taxation between the English Parliament and
monarchs led to the Revolution of 1688, which brought William III and Mary II to the
throne. William and Mary ratified the Declaration of Rights of 1688, known as the "Bill
of Rights". This led to the establishment of financial rules on parliamentary approval for
expenditures, their implementation and control. Parliament passed legislation which
created a "consolidated fund" into which all revenues were to be paid and from which all
expenditures could be taken only with parliamentary approval. 44
The struggle for control over the raising and spending of public money was not confined
to England. Government financial management, or the lack thereof, was one of the issues
that led to the French Revolution. At least one historian has suggested that the first spark
that ignited the French Revolution was the government's declaration of bankruptcy
following its funding of the American Revolution. Although the Comptroller General of
France had, in 1781, assured the government's creditors that there was a "favourable
balance" in the nations' accounts, three years after the war ended, there was an estimated
deficit of nearly a quarter of the total State revenue"5^.
Constitutional Law and the Golden Thread
Section 9 and 10 of the Constitution Act, 1867 establishes the principle that "the
Executive Government and Authority of and over Canada is vested in the Queen".
The powers of the Queen are exercised by Her ministers. Ministers act as agents for Her
Majesty in accordance with the terms of their agency powers as prescribed by Parliament
in the form of legislation. Ministers may also act as agents of Her Majesty under the
provisions of an Orders in Council issued by the Governor in Council acting on the Royal
Prerogative (i.e., the residue of arbitrary authority which at any given time is legally left
in the hands of the Crown).
The powers and responsibilities of each minister are normally set out in the legislation
establishing the minister's department. Departmental Acts (e.g., the Department of
National Revenue Act) provide for the formal appointment of the minister by the Crown,
set out the powers, duties and functions for which the minister is responsible and give the
minister the management and direction of the financial and public service resources
deployed in the department.6(5 The general powers of ministers may be constrained or
expanded by other legislation (e.g., the Financial Administration Act and the Federal
Real Property Act.)
The Constitution Act, 1867 establishes the legal principles underlying the sovereignty of
Parliament in the raising and spending of public money as follows:
Bills for appropriating any Part of the Public Revenue, or for imposing any
tax or impost, must originate in the House of Commons;
- revenues received, other than those reserved to the provinces, "forms one
Consolidated Revenue Fund (CRF);
Parliament has the exclusive legislative authority over the public debt and
property, the raising of money by any mode or system of taxation and the
borrowing of money on the "public credit".
According to the Constitution, revenue can be raised and moneys can be spent or
borrowed by the government only with the authority of Parliament. The right of the
Crown, i.e., the executive branch of Government, to raise taxes and revenues is
prescribed by various Acts passed by Parliament. According to the Financial
Administration Act, all receipts of money by departments and agencies must be deposited
into the CRF. All disbursements from the CRF for spending on operations, for loans,
investments and advances, and for the redemption of matured debt, must be authorized by
Parliament, through annual appropriation Acts and other statutes.77
The Business of Supply
Government financial transactions are classified into the following

categories:
- Budget transactions - transactions with outside parties that are included in
the calculation of the annual deficit or surplus of the Government, e.g.,
expenditures and tax and non-tax revenue.
- Non-budgetary transactions - transactions in loans, investments and
advances in liabilities for the administration of certain public money
received or collected for special purposes, and in all other assets and
liabilities, other than those related to foreign exchange and unmatured
debt.
- Foreign exchange transactions
- Unmatured debt transactions - the net change in amounts owing for
marketable bonds, Canada savings bonds, special non-marketable bonds
issued to the Canada Pension Plan Investment Fund and treasury bills
(by Henry K. Schultz)
Introduction
It is indeed ultimately to the power of the purse, to its power to

bring the whole executive machinery of the country to a
standstill, that the House of Commons owes its control over the
executive.
Sir Erskine May
It is a basic rule of Canadian constitutional law that Parliament controls all public funds
and that the Crown cannot expend those funds without Parliament's authority. This
principle, originally articulated in the English Bill of Rights of 1688, has been
incorporated into the Constitution Act, 1867 by way of the Act's preamble ("... a
Constitution similar in Principle to that of the United Kingdom") and by way of
sections 102 and 106. Section 102 of the Constitution Act, 1867 authorizes the formation
of "One Consolidated Revenue Fund, to be appropriated for the Public Service of Canada
in the Manner and subject to the Charges of this Act provided." Section 106 of the
Constitution Act, 1867 provides that:
Subject to the several Payments by this Act charged on the
Consolidated Revenue Fund of Canada, the same shall be
appropriated by the Parliament of Canada for the Public
Service.
The Financial Administration Act provides in detail for the receipt and spending of public
funds or, to employ the term used in the Financial Administration Act, "public money".
While Part II (Public Money), comprising sections 17-25, imposes requirements on the
receipt and deposit of public money, Part III (Public Disbursements), comprising
sections 26-42, sets out rules as to how that money can be spent.
Section 1: Short Title
1. This Act may be cited as the Financial Administration Act.12'
Section 2: Definitions
"appropriate Minister"
"appropriate Minister" means,

(a) with respect to a department named in Schedule I, the
Minister presiding over the department,
(a.l) with respect to a division or branch of the public service
below) are authorized to obtain authority to establish revolving funds by
way of an appropriation Act.
section 62 — the deputy head must maintain adequate records in relation to
public property for which the department is responsible.
"departmental corporation"
"departmental corporation" means a corporation named in
Schedule II
An entity can only be a "departmental corporation" if it is a corporation and if it is named
in Schedule II. A departmental corporation is like any other department for the purposes
of the Financial Administration Act, except that section 29.1 automatically authorizes
departmental corporations to spend revenues received without seeking additional
authority to establish a revolving fund.
A departmental corporation is not a Crown corporation; see definition of "parent
Crown corporation" discussed below under section 83.
The term "departmental corporation" is used only in the definitions "appropriate
Minister", "department" and "parent Crown corporation" and in sections 29.1 and 72.
"fiscal agent"
"fiscal agent" means a fiscal agent appointed under Part IV
and includes the Bank of Canada
The term "fiscal agent" generally refers to a financial institution that collects and
disburses money, and serves as a depository of funds, on behalf of another. It is part of
the Bank of Canada's mandate to be fiscal agent of the Crown (see Bank of Canada Act, s.
24). A "fiscal agent" must be appointed by the Governor in Council pursuant to
section 51. 2816
The term "fiscal agent" is employed in sections 17, 51, 52, 55, 59 and
159.
"fiscal year"
"fiscal year" means the period beginning on April 1 in one
year and ending on March 31 in the next year
"Minister"
"Minister" means the Minister of Finance
"money"
"money" includes negotiable instruments
The term "negotiable instruments" is defined immediately below,
"negotiable instrument"
"negotiable instrument" includes any cheque, draft, traveller's
cheque, bill of exchange, postal note, money order, postal
remittance and any other similar instrument
This term is employed only in the definition of "money" immediately above and in
section 70, which provides that Part VII (Assignment of Crown Debts) does not apply to
"negotiable instruments".
"parent Crown corporation"
"parent Crown corporation" has the meaning assigned by
subsection 83(1)
This definition is discussed in greater detail in Part X, page 5
"public money"
"public money" means all money belonging to Canada
received or collected by the Receiver General or any other
public officer in his official capacity or any person authorized
to receive or collect such money, and includes
(a) duties and revenues of Canada,
(b) money borrowed by Canada or received through the
issue or sale of securities,
(c) money received or collected for or on behalf of Canada,
and
(d) all money that is paid to or received or collected by a
public officer under or pursuant to any Act, trust,
treaty, undertaking or contract, and is to be disbursed
for a purpose specified in or pursuant to that Act, trust,
treaty, undertaking or contract
Note that the terms "money", "public officer" and "securities" are also defined terms
under the Financial Administration Act.
The definition of "public money" is inclusive, paragraphs (a) to (d) citing examples of the
sort of money that can fall into the definition. 2917 In all cases, however, money must
"belong to Canada" in order to be public money. While the meaning of "money
belonging to Canada" is not entirely clear, it is arguable that it does not necessarily imply
beneficial ownership on the part of Her Majesty. Part (d) of the definition appears to
imply that "public money" can include money held by the Crown in trust for - Le., on
behalf of — another person.
It follows that "money belonging to Canada" necessarily means money that is intended to
be held by, or to be in the possession of, Her Majesty or one of her agents. "Public
money" does not include money that is improperly in the possession of the Crown (e.g,
moneys paid improperly to the Crown or overpayments of money owed to the Crown).
The term "public money" is found in the Financial Administration Act's definition of
"Consolidated Revenue Fund" and in sections 9, 10, 17, 18, 20-22, 76, 78, 80, 81 and
159.
"public officer"
"public officer" includes a minister of the Crown and any
person employed in the public service of Canada
The term "minister of the Crown" is self explanatory, though probably includes within its
meaning, for the purposes of the Financial Administration Act, all ministers and
secretaries of state.
The term "public service of Canada" is not defined, other than in section 11, for the
purposes of sections 11,12 and 13, in the Financial Administration Act. Perhaps the
most authoritative opinion on whether an entity forms part of the "public service of
Canada" is in a letter dated April 3, 1987 by Frank Iacobucci, then Deputy Minister of
Justice:3018
The answer in each case depends on a number of factors,
including the degree to which the organization is free to
manage itself, its dependence on Parliamentary
appropriations, whether the organization is an agent of Her
Majesty, whether the enabling legislation expressly provides
that the organization's employees are deemed to be employed
in the public service for the purposes of the Government
Employees Compensation Act and s [9] of the Aeronautics Act,
and whether the enabling legislation deems the organization
[...] to be a part of the public service.
The term "public officer" is used only in the definition of "public money" and in
sections 9, 20 and 159.
"public property"
"public property" means all property, other than money,
belonging to Her Majesty in right of Canada
Note that the term "money" is also defined in section 2 of the Financial Administration
Act (see above). The term "public property" is found only in sections 10, 61, 62 and 79 of
the Financial Administration Act.
It should be noted that property that belongs to an entity that is not an agent of Her
Majesty is not "public property" for the purposes of the Financial Administration Act.
"registrar"
"registrar" means a registrar appointed under Part IV and
includes the Bank of Canada
A "registrar" must be appointed by the Governor in Council under section 51. 3119
The term "registrar" is found only in sections 51, 52, 55, 59 and 60 of the Financial
Administration Act.
"securities"
"securities" means securities of Canada and includes bonds,
notes, deposit certificates, non-interest bearing certificates,
held pursuant to subsection (2), and the proceeds of the sales
shall be deposited to the credit of the Received General.
(4) Any net profit resulting in any fiscal year from the purchase,
holding or sale of securities pursuant to this section shall be
credited to the revenues of that fiscal year, and any net loss
resulting in any fiscal year from that purchase, holding or sale
shall be charged to an appropriation provided by Parliament
for the purpose.
(5) For the purposes of subsection (4), the net profit or loss in any
fiscal year shall be determined by taking into account realized
profits and losses on securities sold, the amortization
applicable to the fiscal year of premiums and discounts on
securities, and interest applicable to the fiscal year.
Comment
The power of the Minister of Finance to invest public money in securities pursuant to
subsection 18(2) is purely discretionary. The Minister has no obligation to do so.921
Section 19: Charges for Services or Use of Facilities
19.(1) The Governor in Council may, on the recommendation of the

Treasury Board,
(a) by regulation prescribe the fees or charges to be paid
for a service or the use of a facility provided by or on
behalf of Her Majesty in right of Canada by the users
or classes of users of the service or facility; or
(b) authorize the appropriate Minister to prescribe by
order those fees or charges, subject to such terms and
conditions as may be specified by the Governor in
Council.
(2) Fees and charges for a service or the use of a facility provided
by or on behalf of Her Majesty in right of Canada that are
prescribed under subsection (1) or the amount of which is
adjusted under section 19.2 may not exceed the cost to Her
Majesty in right of Canada of providing the service or the use
of the facility to the users or class of users.
(3) For greater certainty, "users" includes
(a) Her Majesty in right of Canada, other than a
department; and
(b) Her Majesty in right of a province. 1991, c 24, s 6.
Section 19.1: Charges for rights and privileges
19.1 The Governor in Council may, on the recommendation of the

Treasury Board,
(a) by regulation prescribe the fees or charges to be paid
for a right or privilege conferred by or on behalf of Her
Majesty in right of Canada, by means of a licence,
permit or other authorization, by the persons or classes
of persons on whom the right or privilege is conferred;
or
(b) authorize the appropriate Minister to prescribe by
order those fees or charges, subject to such terms and
conditions as may be specified by the Governor in
Council. 1991, c 24, s 6.
Section 19.2: Adjustment of amounts
19.2(1) A regulation or order under section 19 or 19.1 may prescribe

rules for the adjustment, by such amounts or ratios as are
referred to in the regulation or order, of the amount of the fee
or charge, for such period as is specified in the regulation or
order, but no such rules may provide for the consideration of
any factors of adjustment that are not specified in the rules.
(2) Notwithstanding that a regulation or order provides for the
adjustment of the amount of a fee or charge for a period, its
amount for the period is equal to its amount for the
immediately preceding period unless the appropriate Minister,
before the beginning of the period, publishes a notice in the
Canada Gazette specifying the adjusted amount and the
manner in which it was determined. 1991, c 24, s 6.
Section 19.3: Regulations subject to other Acts
19.3 Regulations and orders under section 19 and 19.1 are subject
to the provisions of any Act of Parliament relating to the
service or the use of the facility, or to the right or privilege,
but, for greater certainty, may be made even though an Act of
Parliament requires the provision of the service or facility or
the conferral of the right or privilege. 1991, c 24, s 6.
Comment
1. Introduction
The Treasury Board policy on user charges offers the following justification for levying
user charges or fees on services, rights, privileges and the use of facilities:
"User charges provide a means to promote equity in financing
these activities by shifting more of the financial burden from
taxpayers in general to those who benefit most directly." 932
User fees are primarily intended to recover from users the costs incurred by the
government in providing a specific benefit. While taxation is intended to recover the cost
of expenditures made for the common good, user fees are distinguished by the fact that
they apply to users who, in exchange for the fee paid, receive a direct benefit.
For example, the cost of police services is covered through the income taxes paid by all
taxpayers, because this service is intended to ensure the safety of the general public. But
all or part of the costs borne by the government with respect to a national park may
instead, according to the concept of user fees, be recovered from those who benefit the
most directly, that is, the users themselves.
Section 19 establishes a legislative power to levy fees for the provision of service or the
use of facilities; section 19.1 applies to the conferral of a right or privilege by means of a
licence, permit or other authorization.
In both cases, the Governor in Council may either prescribe fees by regulation or
authorize the appropriate Minister to prescribe those fees by order. The regulations are
made on the recommendation of the Treasury Board, but the orders are not. However,
both of these instruments are regulations within the meaning of the Statutory Instruments
Act, 943 and as such are subject to examination by the Privy Council Office Section of the
Department of Justice and are subject to the regulatory process. As to orders of the
Governor in Council authorizing the Minister to prescribe fees by order, these are not
statutory instruments in the absence of the words "by order." But since they are published
in the Canada Gazette, Part II, they are subject to the same examination.
Beyond these legislative provisions, user fees may be prescribed in two other manners:
first, under the basic legislation establishing departments or programs,954 and second,
under each Minister's power to enter into contracts. 965
Lastly it should be noted that the present provisions of the Financial Administration Act
have been in force since May 8, 1991,976 that is, after the adoption of the Treasury Board
policy, 987 which explains the fact that the latter is not always consistent with the
Financial Administration Act.
2. Other legislative authorities
The other legislative provisions that establish a basis for prescribing user fees and the
Financial Administration Act provisions are concurrent enabling authorities, and either
may be used to prescribe fees unless the application of sections 19 and 19.1 is excluded
under those other provisions. "8
This position was the one adopted by the interdepartmental subcommittee on legal
questions related to user fees and cost recovery. 1009 which also recommends that
regulations prescribing fees should be made under the two enabling authorities, that is,
under both the Financial Administration Act and the more specific legislative provisions,
so as to ensure coverage of all services, rights or privileges described in the regulations
prescribing the fees. 10110
According to the decision Bartholomew Green 1751 Ass. v Canada,10211 section 13 of
the Financial Administration Act, as it read before the 1985 revision and the 1991
amendments, could authorize an increase in postal rates despite the existence of similar
provisions in the Post Office Act.
In addition, section 19.3, which states that regulations and orders made under sections 19
and 19.1 are subject to the provisions of other statutes, does not indicate that it is the
actual power to prescribe fees provided for in the Financial Administration Act that is
subject to the said provisions, but rather the enactments made under the Financial
Administration Act prescribing those fees. This is specifically indicated by the marginal
note in the English version of section 19.3. It would seem, then, that the purpose of
section 19.3 is instead to establish that the sections of the Financial Administration Act
do not authorize changes to the conditions imposed by other statutes concerning the
provision of services or facilities or the conferral of rights or privileges.
Consequently the provisions of the Financial Administration Act apply unless they are in
conflict with the other statutes or unless the application of the Financial Administration
Act is excluded, either explicitly or by implication. 10312
3. Definitions of service, right or privilege
In Bartholomew,10413 the court drew on the general meaning of the term "service," given
the absence of a specific definition in law. A service is provided if a link can be
established between the service, the benefit received by the user and the latter's obligation
to pay fees for the service. 10514
The extent of a Minister's power to charge fees for services is not limited to services
expressly provided for in legislation; rather it covers all services falling within the
Minister's terms of reference. 10615
Furthermore, since the amendments of 1991, section 19.3 explicitly provides that fees
may be prescribed even if, under the terms of a federal statute, the services or facilities
are provided or rights or privileges are conferred on a mandatory basis.
As regards fees for rights or privileges,10716 the law does not appear to limit their
application to those provided for by law, although as a general rule a licence, permit or
other authorization that confers a right is usually required by law.
The distinction between service and the use of facilities on the one hand and a right or
privilege on the other is especially important because of the issue of cost recovery. For
the former, subsection 19(2) limits cost recovery to the costs incurred by Her Majesty in
providing the services or facilities; for rights and privileges, no limit is imposed, opening
the way to charging fees equivalent to the fair market value of the right or privilege
conferred. 10817
4. Fees imposed by contract
In J. E. Verrault v A. G. Quebec, 10918 Pigeon J. cited the rule according to which Her
Majesty, like any physical person, can enter into a contract. As a consequence of this
rule, fees may be levied by contract, either by Her Majesty or by Ministers contracting on
Her Majesty's behalf. This power is not excluded by the Financial Administration Act,
since the wording of sections 19 and 19.1 is basically intended to provide for the power to
make regulations or orders to prescribe user fees without excluding any other ways of
levying such fees. u°19
The appeal of this option has primarily to do with the fact that the regulatory process does
not come into play. However, it is important to recall the comments of the Auditor
General 11120 concerning the issues of parliamentary control and equity in setting user
fees when these are established by contract, to say nothing of the consultation and
publication requirements inherent in the regulatory process.
In a recent decision currently under appeal, it was held that the obligation to pay fees to a
third party for the monitoring of fishing quotas, set out as a condition for a fishing
licence, had been established unlawfully. 11221
The levying of fees by contract is probably valid when there are few users or when the
terms and conditions are complex. 11322 The abolition of entrance fees in the national
parks was justified on the grounds that there were more appropriate means to set fees in a
market-responsive manner for non-monopoly recreational facilities and services. 11423
Legally, there appears to be no restriction limiting the use of this approach. However,
when under the terms of the law, services or facilities are provided or rights or privileges
are conferred on a mandatory basis, the answer is not obvious, given the absence of a free
and voluntary consideration on the part of Her Majesty in exchange for the fees paid. 11524
5. Cost recovery and the power of taxation
Subsection 19(2) provides that the fees to be charged for a service or the use of a facility
are limited to the costs of providing it.
While this provision applies only to fees levied under the Financial Administration Act,
the Treasury Board policy establishes an identical rule for charges levied for government
services and the use of public facilities, except in the case of a sale, lease, licence or loan.
11625
According to case law, 11726 the levying of fees in excess of the total cost incurred to
provide the services could be tantamount to a tax imposed unlawfully, since only
Parliament would have the authority required for such a levy. For example, in Thome's
Hardware Ltd v R, 11827 the Court indicated that in order to prove that fees are actually
taxes, it would be necessary to first establish that the revenues from these fees are
significantly greater than the cost of providing the services.
However, that legal precedent would seem not to be conclusive, since in Thome's
Hardware this issue was examined indirectly, and the facts of the case were not such that
it could be alleged that the fees levied were greater than the cost. 11928
In the case of fees for rights or privileges, a New Zealand decision states that these may
correspond to the value of the right or privilege thus conferred. 12029
Some legislative provisions provide for fees for permits and it is not clear from the
wording whether the legislator intended to limit the fees to the amount required in order
to recover the cost of issuing the permit, without taking account of its value. In that case,
if it can be established that the permit confers a right or privilege that has a certain value,
it is recommended that in addition to the specific legislative provision, section 19.1 be
used to impose fees in excess of the costs incurred. 12130
It would appear that the courts would continue to make a distinction between fees and
taxes, even when dealing with a legislative provision explicitly calling for recovery in
excess of the costs incurred in providing the services. 12231
However, it should be noted that in the matter of Aerlinte 12332 (which concerned fees for
services provided at airports), in the absence of any reference in the applicable legislative
provisions to the concept of cost recovery as an objective for prescribing fees, the Federal
Court of Appeal held that the provision was a "pricing provision" concerned with the
setting of fees rather than cost recovery. However, the facts of the case had not shown
that the fees had exceeded the total cost to the government.
Lastly, it is once again worth noting Thome's Hardware, 12433 in which the Supreme
Court affirmed that the statute in question authorized the imposition of fees regardless of
whether the user had received services, the only condition being in this case that the
vessel had to enter the port.
6. Refunding of fees
User fees collected on behalf of the government are public money within the meaning of
the Financial Administration Act. In accordance with section 17 of that Act, public
money is deposited to the credit of the Receiver General, that is, it is deposited in the
Consolidated Revenue Fund and may be removed from it only by law.
Subsection 20(2) provides that money paid with respect to a purpose that has not been
fulfilled may, pursuant to the regulations of the Treasury Board, 12534 be returned or
repaid, less the sum attributable to any service rendered. This provision applies provided
that at the time of the payment of the fees, the services were not yet rendered, in whole or
in part.
However, a case has arisen in which the refunding of fees paid for a licence had to be
done by way of a remission order 12635 on the recommendation of the Standing Joint
Committee on Scrutiny of Regulations, because in the regulations prescribing the fees
12736 there was no provision stipulating that lesser fees were payable in the event of a
reduction of the period for which the licence was issued. 12837
The regulations in question, instead of providing for a fixed fee to be paid in advance for
the year, should have provided for a fee payable on the basis of the number of months for
which the licence was required by the applicant. The regulations should be amended so
as to take this adjustment into account and eliminate the need for a remission order.
7. Authorization to spend revenues from fees paid
Under section 17 and the definition of "public money" in the Financial Administration
Act, revenues from fees paid are deposited in the Consolidated Revenue Fund. However,
under section 29.1, a department could use its revenues to cover the expenses relating to
the operations for which the fees are levied, if the department has, under an
Appropriations Act, either a net voting 12938 ~ that is, an authorization to offset its
expenses through its revenues during a fiscal year — or a revolving fund that authorizes it,
over a number of fiscal years, to use its revenues to pay its expenses according to the
conditions applicable to the fund. But even in this case, that portion of the fee-generated
revenues which exceeds the total cost incurred for the applicable operating expenses (in
the case of licence fees, for example) must be put into the Consolidated Revenue Fund.
The Treasury Board has, however, undertaken to return to the departments, through the
Supplementary Estimates, an annual appropriation derived from the granting of licences
on the intellectual property under their control. 13039
8. Total cost and factors of adjustment
Under subsection 19(2), fees are intended to recover costs incurred by the government.
According to the policy, the total or full cost 13140 corresponds to the sum of all direct and
indirect costs, including the capital cost, salaries, fringe benefits (20% of base salary) and
rent, even if these are paid by other departments. 13241
Under paragraph 19.2(1), rules for adjustment may be used in prescribing fees payable.
However, the factors of adjustment used must be appropriate in terms of their importance
in the calculation of the total cost. For example, the Consumer Price Index is not a valid
factor when the cost of a service is based entirely on salaries. 13342
9. Sale of public property
Sections 19 to 19.3 do not apply to the sale of public property. 13443 The provisions of the
Financial Administration Act that apply to the sale of public property are, firstly,
subsection 61(1) in the case of a federal building, and secondly, subsection 61(2) in the
case of other property.
Other legislative provisions providing for the charging of user fees may include the power
to set a price for the sale of public property. 13544 Unlike sections 19 and 19.1, these
provisions generally do not impose the regulatory process. Thus it is up to the Minister to
stipulate how fees or charges are to be levied,13645 in conformity, however, with the
policy of the Treasury Board.
Concerning the sale of publications, section 15 of the Department of Supply and Services
Act 13746 assigns responsibility for this to the Queen's Printer. It should be noted that
under section 7 of the same Act, the Minister is authorized to delegate this function to
other Ministers. 13847
In general, the selling price of public property is justified by its market
value.
10. Intellectual property
The granting of intellectual property under the control of a department is generally done
by means of a licence granted by the Minister by virtue of his or her contracting authority.
I3948
In some cases, the provisions of the Financial Administration Act may apply, as for
example where the compilation of data is characterized as providing a service. 14049
Concerning royalties from the granting of licences on intellectual property, the Treasury
Board has adopted an incentive measure designed to increase departments' interest in
marketing their intellectual property by providing for an increase in their appropriation
based on their revenues from this source. 14150
In setting the licence fees, it would be justifiable to use the market
value of the intellectual property or its use. 14251
] 1. Terms of payment, interest and administrative charges
While it is recommended that it be required that fees be paid before services are provided,
14352 this should not be imposed in the form of a deposit, even though there are arguments
in favour of the latter practice, 14453 but rather in the form of a partial payment
(instalment) or a full payment to be made at a specific time.
Section 155.1 provides for the payment of administrative charges (to be established in
accordance with regulations) and interest on fees payable, whether such fees result from
regulations or from a contract. However, these provisions will not apply until the
regulations come into force.
12. Pricing structure and fees prescribed for users individually or as a class
Even though sections 19 and 19.1 explicitly provide for prescribing fees or charges
payable by users individually or as a class, the power to prescribe fees was recognized as
implicitly authorizing the establishment of classes of users for this purpose. 14554
According to subsection 19(2), the costs of providing a service to a class of users must be
supported solely by the fees paid by the users in that class. In other words, the fees paid
by one class of users may not be used to subsidize the services provided to other users or
other classes of users. 14655 For example, if it is decided not to recover all costs for a
particular class, the difference must be made up by the department alone. However, the
fees paid by a user may exceed the value of the services actually received by that user.
14756 In the final analysis, theoretically it is necessary to "ensure that there is reasonable
homogeneity within a class and that there are no wide disparities in the actual costs of
providing the service to the various users in the class." 14857
The Treasury Board policy, moreover, provides for the reduction of charges in peak
periods in light of the cheaper cost of servicing, and for volume discounts where the cost
per item is less. 14958
13. Consequences where fees are invalid or errors are made in charging
According to the quantum meruit rule - that is, if it can be established that in
consideration for the fees paid the user received an equivalent value - there would be a
valid argument for refusing to refund fee payments despite the invalidity of the
regulations under which the fees were charged. 15059
In a split decision,13160 the Supreme Court recently affirmed that the defence of estoppel
could be relied on in refusing to pay a claim based on quantum meruit presented by a
public utility in order to recover amounts not collected between 1979 and 1986 because
of a billing error:
"The law of restitution would normally force the Co-op to
return the value of the benefit to Kenora Hydro unless that
value was no longer in the Co-op's possession because of a
change of position. In this case, the Co-op successfully proved
that it acted to its detriment in reliance on the billing
statements for its own billing and budgetary purposes and that
therefore the value of the electricity no longer existed for the
purposes of restitutionary relief. Kenora Hydro conceded that
this was in fact the case in the Court of Appeal and confirmed
it before this Court. The defence of estoppel is thus an
expression of what the common law has considered to be
sufficient justification to release a defendant from liability in
the pursuit of fairness..." 15261
14. Collection of fees by a contractor
The fees levied by a contractor or any other agent of Her Majesty become public money
within the meaning of the Financial Administration Act and as such must be paid into the
Consolidated Revenue Fund. 15362 Consequently, agents cannot retain, from the fees that
they collect, a portion to cover the cost of their service. 15463 The department must
therefore pay the contractor's collection costs out of its appropriations or pursuant to some
other statutory authority, such as subsection 17.1(2).
15. Organizations covered by the expression "Her Majesty" or "on behalf of Her
Majesty"
Even though an organization is listed in the schedules to the Financial Administration Act
as a department, this is not in itself an indication that in providing services or conferring
rights, it does so in the capacity of Her Majesty or on Her Majesty's behalf. This instead
depends on whether the organization is an agent of the Crown, on the basis of the extent
and degree of control exerted on the organization by the Cabinet or its Ministers.15564
Section 20: Return of Deposits
s. 20(1) Where money is received by a public officer from any person

as a deposit to ensure the doing of any act or thing, the public
officer shall hold or dispose of the money in accordance with
regulations of the Treasury Board.
(2) Where money is paid by any person to a public officer for any
purpose that is not fulfilled, the money may, in accordance
with regulations of the Treasury Board, be returned or repaid
to that person, less such sum as in the opinion of the Board is
properly attributable to any service rendered.
(3) Money paid to the credit of the Receiver General and not being
public money may be returned or repaid in accordance with
regulations of the Treasury Board.
Comment
Subsection 20(1) requires that money received by a public officer as a deposit or, in
effect, as security, for the doing of any act or thing to be held or disposed of in
accordance with regulations made by the Treasury Board.
Subsections 20(2) and (3) provide authority for money to be repaid to the payer where the
purpose for which it was paid has not been fulfilled or where the money is determined not
(by Geoffrey S. Lester)
Introduction
Public servants owe a duty of loyalty and fidelity to the Crown in the discharge of their
duties. They are in a position of trust. In the nature of things, they handle money and
other property which is not theirs, but belongs to the Crown. These must be accounted
for. A public servant's relationship with those who make decisions as to the expenditure
of public monies and with those who stand to benefit from those decisions being made in
a certain way, obviously gives opportunity for corrupt practices to develop. Such
wrongdoing can result in civil and criminal liability. Thus by s. 122 of the Criminal Code
6171 every official who, in connection with the duties of his office, commits fraud or a
breach of trust is guilty of an indictable offence and liable to imprisonment for a term not
exceeding five years, whether or not the fraud or breach of trust would be an offence if it
were committed in relation to a private person. 6182
The courts view a public servant's position of trust very seriously 6193. The requirement
that public servants be able to be trusted in the handling of public monies and to
discharge their duties honestly is at the heart of Part IX of the Financial Administration
Act. The relevant provisions of the Act are reproduced below for ease of reference.
Part IX of the Act basically does four things:
(1) It establishes a simple procedure for recovery of funds not properly applied
or accounted for;
(2) It facilitates proof of the Crown's case for recovery of money in court;
(3) It allows the Crown to sue a public servant under certain circumstances for
the recovery of money lost to the Crown even where that public servant
did not actually receive that money as a matter of fact; and
(4) It establishes offences, independent of those set out in the Criminal Code,
for which a public servant may be prosecuted in relation to the improper
acts of "every officer or person acting in any office or employment
connected with the collection, management or disbursement" of public
monies.
The Distinction between a Crime and a Civil Wrong
Before an act is to be denounced as criminal, there must be a guilty state of mind, or mens
rea, that is, an evil intention, or a knowledge of the wrongfulness of an act; coupled with
a wrongful act, or actus reus. A crime may be described as an act, default or conduct
prejudicial to the community, the commission of which by law renders the person
responsible liable to punishment by fine or imprisonment in special proceedings,
normally instituted by officers in the service of the Crown. 6204
Civil liability, on the other hand, is concerned less with punishing wrongdoing than with
the enforcement of some right claimed by the plaintiff against the defendant. He who
proceeds civilly is a claimant, demanding the enforcement of some right vested in
himself; he who proceeds criminally is an accuser, demanding nothing for himself, but
merely the punishment of the defendant for a wrong committed by him. 6215
An act or omission can be both a crime and a tort; e.g. you can be prosecuted for assault,
and sued by the victim for any injury done. Similarly, fraud is a criminal offence as well
as a civil wrong. The essence of fraud is dishonesty.
The Standard of Proof
In a criminal case, the prosecution must prove its case "beyond a reasonable doubt",
whereas in a civil case the standard of proof is lower, being on "a balance of
probabilities". Proof of an act in a civil case that is also criminal, such as fraud, must also
reach a balance of probability, but the trier of fact could consider the cogency of the
evidence and it is entitled to scrutinize the evidence with greater care if there are serious
allegations to be established. It does not adopt so high a degree as a criminal court, even
when it is considering a charge of a criminal nature, but still it does require a degree of
probability which is commensurate with the occasion.6226
The Mode of Proof
Ordinarily, in both criminal prosecutions and civil actions, evidence is given orally by a
witness on oath or affirmation, and that witness is liable to be cross-examined on that
evidence; and by proving and admitting into evidence documents (provided they are
otherwise admissible). A document is ordinarily proved by calling as a witness the maker
of the document, or a person who is familiar with the maker's handwriting or signature.
The witness identifies the handwriting or signature, so that the document is proved to be
what it purports to be; e.g., a memorandum from A, a receipt issued by B, a letter written
by C, etc.
As a general rule, the original of a document must be produced before it can be admitted
into evidence. This rule is subject to a number of exceptions allowing for the
admissibility of copies at common law, and special rules for admitting copies into
evidence and proving them now also exist under statute. Generally, the documents must
answer the particular description in the statute, and that fact must be proved by the oath or
affirmation of a person having knowledge of it. 62j7
There is a traditional rule at common law against admitting into evidence material that is
"hearsay". Hearsay can be defined broadly as a statement, either oral or in writing, made
by a person out of court, and who is not called as a witness. "What the soldier said is not
evidence." Hearsay evidence is considered to be unreliable because the statement is
(usually) not made under oath or affirmation, and the statement cannot be cross-examined
on. Whilst the rule is subject to a number of exceptions at common law 624§, the Supreme
Court of Canada has made major inroads into the rule, such that it might be doubted that
the rule itself now exists. 6259 Suffice to say that hearsay evidence now appears to be
admissible provided it is proved to be reliable, and it is necessary for the purposes of
proving one's case.
Documentary evidence always presents a potential hearsay problem, simply because the
document can only "tell" the court what the maker has told the document. If tendered to
prove that the statement made in the document was in fact made (e.g. that A wrote to B
alleging that C was a liar and a thief) the document is not hearsay, but proof of the fact in
issue. Thus in an action for libel by C against A, C need merely prove the letter and
tender it in evidence. It is inadmissible as hearsay to prove the truth of the contents of the
document (e.g. that C is in fact a liar and a thief).
There are also statutory exceptions to the rule against hearsay, and so books or records of
the Government of Canada, banker's records, and business records are admissible in
evidence under certain circumstances as proof of the truth of their contents. 62610
Section 76: Notice to persons failing to pay over public money
76.(1) When the appropriate Minister or Receiver General believes

on reasonable grounds that any person
(a) has received money for Her Majesty and has not duly
paid it over,
(b) has received money for which the person is accountable
to Her Majesty and has not duly accounted for it, or
(c) has received any public money applicable to any
purpose and has not duly applied it,
the appropriate Minister or Receiver General, as the case may
be, may cause a notice to be served on that person, or on that
person's representative in case of the person's death, requiring
the person, within such time after the service of the notice as
may be named therein, duly to pay over, account for or apply
that money, as the case may be, and to transmit to the
appropriate Minister or the Receiver General, as the notice
provides, proper vouchers that the person has done so.
(2) Where a person does not comply with a notice served under
subsection (1), the appropriate Minister or the Receiver
General, as the case may be, shall state an account between
that person and Her Majesty showing the amount of money not
duly paid over, accounted for or applied, as the case may be,
and may charge interest on the whole or any part of that
amount from such date as the appropriate Minister or the
Receiver General may determine and at such rate as may be
prescribed pursuant to subsection 155.1(6).
(3) In any proceedings for the recovery of money referred to in
subsection (2), a copy of the account stated and certified by the
appropriate Minister or the Receiver General is evidence that
the amount stated in the account, together with interest, is due
and payable to Her Majesty, without proof of the signature of
the appropriate Minister or the Receiver General or the official
character of the office.
(4) Any amount of money referred to in subsection (1) and the
interest on that amount may be recovered as a debt due Her
Majesty.
1. Introduction
Generally, where one person owes money to another person, that is the result of an
agreement between the parties. For instance, a creditor lends money to his debtor, on a
promise to repay; a bailiff collects rents for his landlord, on a promise to account. The
party owed money can sue on that agreement.
Section 76 of the Act reaches the same result, but it does so by allowing the Crown
unilaterally to establish liability to repay. This is done by allowing the Crown to take two
distinct steps.
(1) once certain grounds are believed to exist, by calling in writing on the
person to pay over and account for or apply the monies properly; and
(2) by establishing the amount due and deeming it to be a debt for which the
Crown can sue.
2. Notice to Persons Failing to pay over Public Money; Section 76(1)
76.(1) When the appropriate Minister or Receiver General believes

on reasonable grounds that any person
(a) has received money for Her Majesty and has not duly
paid it over,
(b) has received money for which the person is accountable
to Her Majesty and has not duly accounted for it, or
(c) has received any public money applicable to any
purpose and has not duly applied it,
the appropriate Minister or Receiver General, as the case may
be, may cause a notice to be served on that person, or on that
person's representative in case of the person's death, requiring
the person, within such time after the service of the notice as
may be named therein, duly to pay over, account for or apply
that money, as the case may be, and to transmit to the
appropriate Minister or the Receiver General, as the notice
provides, proper vouchers that the person has done so.
Comment
This subsection allows the Minister or the Receiver General to demand a person to repay,
account for or apply to its proper purpose money that the person has received but has not
paid over, not accounted for or has not properly applied.
By section 2 of the Act, "money" includes negotiable instruments; and "negotiable
instrument" includes any cheque, draft, traveller's cheque, bill of exchange, postal note,
money order, postal remittance and any other similar instrument.
The subsection can be invoked only where:
(1) there are reasonable grounds for believing that the person actually received
money (as defined);
(2) the person has received money, not other chattels such as books, papers,
motor vehicles, etc.; and
(3) the money was received for Her Majesty; and
(4) the appropriate Minister or the Receiver General must believe on

reasonable grounds that the facts exist supporting the demand.
This section operates very widely, and is not restricted to public servants who are
employed in the collection or management of public monies.
The notice should contain a statement of the exact amount or amounts due.
The Notice should contain a brief statement of the grounds relied upon to support the
claim made in the Notice, and a time limit within which the demand can be satisfactorily
answered.
For a precedent, see Appendix, Form 1.
The person can satisfactorily answer the demand by providing "proper vouchers" or by
paying over the money.
In those cases where monies due Her Majesty have not been duly accounted for as a result
of mere inadvertence or lack of appropriate diligence on the part of the person required to
account, service of the notice, followed by payment of the amount required to satisfy the
debt, will generally bring an end to the matter. If the conduct was criminal, then a
prosecution might follow.
3. An Account may be stated where Notice not Complied with: Sections
76(2) and 76(4)
(2) Where a person does not comply with a notice served under
subsection (1), the appropriate Minister or the Receiver
General, as the case may be, shall state an account between
that person and Her Majesty showing the amount of money not
duly paid over, accounted for or applied, as the case may be,
and may charge interest on the whole or any part of that
amount from such date as the appropriate Minister or the
Receiver General may determine and at such rate as may be
prescribed pursuant to subsection 155.1(6).
(3)
(4) Any amount of money referred to in subsection (1) and the
interest on that amount may be recovered as a debt due to Her
Majesty.
Comment
In those cases where proper vouchers have not been provided or payment is not
forthcoming within the period of time stipulated in the Notice served pursuant to
section 76(1), section 76(2) allows and requires the appropriate Minister or the Receiver
General to take steps towards establishing the amount in issue with a view to initiating
civil proceedings necessary to recover the amounts owing. He does this by the technique
known as an "account stated". 6271 1
The amount owing and any interest thereon is deemed by section 76(4) to be a debt due to
Her Majesty.
Generally speaking an account stated is an admission of a sum of money being due from
the defendant to the plaintiff. Such sum of money can be recovered by action. The action
lies upon an absolute acknowledgement made by the defendant to the plaintiff of a debt
due from him to the plaintiff and payable at the time of action brought. 62812 At common
law, the basic notion is that the defendant admits or acknowledges the existence of a debt.
Section 76(2), coupled with section 76(4), has the same practical effect as enabling the
Crown to sue for a debt that has arisen under the circumstances contemplated under
section 76(1). But the essential notion here is that the Crown can establish the existence
and the amount of the debt unilaterally, that is, without an admission or
acknowledgement by the person allegedly owing the amount due.
The subsection also allows the person to be charged with interest in the terms mentioned.
For a precedent, see Appendix, Form 2.
4. Proof of the Amount Due and Owing: Section 76(3)
(3) In any proceedings for the recovery of money referred to in
subsection (2), a copy of the account stated and certified by the
appropriate Minister or the Receiver General is evidence that
the amount stated in the account, together with interest, is due
and payable to Her Majesty, without proof of the signature of
the appropriate Minister or the Receiver General or the official
character of the office.
Comment
This subsection simplifies proof of the Crown's claim by dispensing with the need to call
a witness to prove that the amount claimed together with interest is the proper amount;
62913 and to prove the signature of the Minister or the Receiver General.
Thus the Crown's claim can be proved simply by tendering in evidence the account stated,
certified by the appropriate Minister or Receiver General.
It is important to recognize that under the procedure set up by this scheme, the Crown
need not allege or prove any actual wrongdoing (either criminal or negligent).
A person who is served with legal process claiming the amount due 63014 as a debt may of
course dispute the amount claimed or in effect deny liability by showing no debt is due.
However, if he or she wants to establish a defence or reduce the amount, he or she will
probably be driven into the witness box to give evidence to contradict the case established
by tendering the certificate of the appropriate Minister or Receiver General certifying the
copy of the account stated.
If the evidence in the account stated is left uncontradicted, or the defendant's evidence is
considered insufficient to displace the Crown's case, Her Majesty will be entitled to an
order for the specified amount. Once judgment is obtained, it can be executed against the
defendant's assets in the ordinary course.
It should also be noted that by section 38(2) of the Act any accountable advance or any
portion thereof that is not repaid, accounted for or recovered in accordance with the
regulations may be recovered out of any moneys payable by Her Majesty to the person to
whom the advance was made or, where the person is deceased, out of the moneys payable
by her Majesty to the estate of that person.
5. Summary
Section 76 accordingly lays down an efficient mechanism to establish a claim by the
Crown for monies received but not paid over, received but not accounted for, or not
applied to its proper purpose by any person. It thus allows the Crown:
(1) to fix the amount owing, together with any interest;
(2) to state an account; and
(3) to prove its case in a civil proceeding by tendering a copy of the account
stated appropriately certified.
Section 77: Facilitating proof in certain cases
77. Where it appears by the books or accounts kept by or in the

office of any person employed in the collection or management
of the revenue, in any accounting by that person or by his
written acknowledgment or confession, that that person has,
by virtue of his office or employment, received money
belonging to Her Majesty and refused or neglected to pay over
that money to the proper persons at the proper times, an
affidavit deposing to those facts, taken by any person having
knowledge thereof, shall, in any proceedings for the recover of
that money, be admitted in evidence and is, in the absence of
any evidence to the contrary, proof of the facts stated therein.
Comment
This section does not create any liability but merely facilitates proof of the facts contained
in the affidavit. An affidavit is a written statement of fact that is sworn or affirmed to be
true by the deponent. Thus a witness need not be called to give oral evidence. 63115 The
Crown can prove its case by tendering the affidavit. The deponent must have personal
knowledge of the facts sworn or affirmed to; knowledge derived second-hand is not good
enough.
An affidavit is admissible under this section only where the following facts can be
established by the books or accounts kept by or in the office of any person employed in
the collection or management of the revenue, in any accounting by that person, or by his
own admission that:
(1) the defendant is a person employed in the collection or management of the
revenue;
(2) the defendant received money belonging to Her Majesty; and
(3) the defendant has refused or neglected to pay over that money to the
proper persons at the proper times.
An affidavit can be tendered under this section only in a case involving a person who is
employed in the activity of collecting or managing the revenue, for example, an accounts
clerk or a customs officer. But a secretary in an accounting office, who merely typed
letters, but was not employed in the collection or management of the revenue, would not
be caught by this section. It would thus be a complete answer to a case based on an
affidavit tendered under this section that the defendant was not a person who came within
the section.
Unless the defendant adduces evidence to contradict or modify the facts in the affidavit
(for instance, through cross-examination of the deponent), then they can be taken as
proved and acted on by the court.
In practice, it would be rare to rely upon this section. It would usually be resorted to
where, for example, the defendant did not appear or was not expected to give evidence.
Section 78: Liability for loss caused by Malfeasance or

Negligence
78. Where, by reason of any malfeasance or negligence by any

person employed in collecting or receiving any public money,
any sum of money is lost to Her Majesty, that person is
accountable for the sum as if that person had collected and
received it and it may be recovered from that person as if that
person had collected and received it. 63216
Comment
"Malfeasance" in this context means criminal wrongdoing, and so requires proof of mens
rea, and includes civil fraud. "Negligence" essentially means carelessness, or conduct
that while not intentional is nonetheless morally blameworthy.
This section does two things. First, it makes a public servant 63317 employed in collecting
or receiving any public money liable where as a result of malfeasance or negligence the
Crown suffers loss of any public money. Second, it prevents the public servant from
saying that he or she never actually collected or received the money, for the public servant
is made accountable for the sum as if that person had collected and received it. That sum
can therefore be recovered by action brought by the Crown.
Where the amount of loss can be established before the action is brought, and can be
reduced to a sum certain or a liquidated demand, 63418 the Crown can sue on what is
known as one of the "common counts", being an action for money had and received. It is
a good defence to such an action to prove that the defendant did not receive the money.
That defence is foreclosed by this section.
Where, on the other hand, the amount of loss cannot be established beforehand, the
Crown can only sue for an unliquidated demand. 635^
In contrast to the scheme set up by section 76 where liability is established by tendering
the account stated as certified but without other evidence, in order to establish liability
under section 78, the Crown must prove that money:
(1) has been lost to Her Majesty;
(2) that such loss has been caused by reasons of malfeasance or negligence;
and
(3) that such malfeasance or negligence was done by a person employed in
collecting or receiving public money.
This section applies in narrower circumstances than under section 76: the public servant
must be employed in the collection or receiving public money; money must be lost, and
the public servant must have been guilty of malfeasance or negligence.
These allegations would ordinarily be proved by calling witnesses to the facts in issue;
however, under appropriate circumstances it would be possible to rely upon an affidavit
framed in light of section 77.
This section does not allow the Crown to recover money from an alleged delinquent third
party who has received money from the Crown pursuant to an agreement but has
misappropriated it. The Crown's remedy, if any, is for breach of contract,63620
The current standard of liability allows for an action to recover the funds from the
individual responsible for the loss in those situations where that individual ought to have
known that his act or omission would result in the loss, (eg. the careless act of leaving
funds in an unlocked desk drawer overnight), or as a result of deliberate acts such as
fraud.
Where the acts of a public servant involve criminal wrongdoing (e.g., theft or fraud) thus
allowing the Crown to recover the money lost by reason of the liability imposed by
section 78, the public servant may be prosecuted pursuant to section 122 of the Criminal
Code. There is machinery in the Criminal Code that enables the court to order restitution
as part of a probation order, compensation or to pay satisfaction or compensation.63721
Where the circumstances of the offence warrant an application under this machinery,
arrangements must be made to have a person with knowledge appear before the
sentencing court for the purpose of making the request. If relying on the Criminal Code
provisions results in the money being restored to the Crown, then there will be no need to
take civil proceedings. (However, in practice, the court will not make orders under these
sections against an accused who is impecunious.)
Where criminal proceedings have been taken, but the accused has been acquitted, the
Crown is not prevented from taking proceedings to recover under the machinery provided
by section 76(1), 63822 or any other civil action to enforce any right arising under section
78.
Section 79: Regulations in respect of losses of money and

Public Property
with the collection, management or disbursement of
public money, with intent
(i) to influence the decision or action of that officer
or person on any question or matter that is then
pending, or may, by law, be brought before him
in his official capacity, or
(ii) to influence that officer or person to commit, or
aid or abet in committing any fraud on the
revenue, or to connive at, collude in, or allow or
permit any opportunity for the commission of
any such fraud, or
(b) accepts or receives any such bribe,
is guilty of an indictable offence and liable on conviction to a
fine not exceeding three times the amount so offered or
accepted and to imprisonment for any term not exceeding five
years.
Comment
In addition to those offences set out in section 80 specific penalties are also available for
those who offer, and those who accept, bribes in relation to dealings with public monies.
The penalty provision for this offence, and the others set out in section 80, are essentially
the same as those available under the Criminal Code for the crimes of fraud upon the
government 64428 and breach of trust by a public officer. 64529
As mentioned earlier the bulk of those offences enumerated in sections 80 and 81 of the
Act involve conduct which could also be prosecuted under related Criminal Code. While
the Act's provisions may be designed to cast a broader net of culpability it should be
noted that where the facts would warrant prosecution, investigative agencies will likely
resort to charges under the Code. Reference should be made to Part XIII of the Criminal
Code regarding liability of those associated with criminal acts as parties, through attempts
or by way of criminal conspiracy.
It should also be noted that by section 126(1) of the Criminal Code, every one who,
without lawful excuse, contravenes an Act of Parliament by wilfully doing anything that
it forbids or by wilfully omitting to do anything that it requires to be done is, unless a
punishment is expressly provided by law, guilty of an indictable offence and liable to
imprisonment for a term not exceeding two years. 64630
Section 82: Books, papers, etc. deemed to be Chattels and

Money or Valuable Securities deemed to belong to
the Crown
82. All books, papers, accounts and documents kept or used by, or
received or taken into the possession of, any officer or person
who is or has been employed in the collection or management
of the revenue or in accounting for the revenue, by virtue of
that employment, shall be deemed to be chattels belonging to
Her Majesty, and all money or valuable securities received or
taken into the possession of that officer or person by virtue of
his employment shall be deemed to be money and valuable
securities belonging to Her Majesty.
Comment
Section 82 provides that all books, papers, accounts and documents kept, used or received
in the course of employment by a person employed in the collection management or
accounting of revenue are property of Her Majesty. Further, all money or securities
received or taken into possession by such a person are deemed to belong to Her Majesty.
The practical effect of this section is to take the money or valuable securities in question
out of the officer's personal estate so that they are not available to be distributed to his
creditors in the event of his bankruptcy. Without this section, the Crown would be an
ordinary unsecured creditor, and have to prove the debt and then claim priority under the
prerogative.
Appendix
The following draft Notice and Statement of Account were developed by Lloyd R. Spiro
of the Department of Justice in the context of the Post Office, before the Post Office
became a Crown Corporation. They may however, be easily adopted for any situation
contemplated under section 76.
FORM 1
NOTICE
Pursuant to Section 76 of the Financial

Administration Act R.S. c. F-ll
as amended
TO: Mr. John Doe

Main Street
Blank, Ontario
This Notice is served on you pursuant to Section 76(1) of the Financial Administration
Act.
WHEREAS the Minister of [insert Department] (or the Receiver
General) has reason to believe that you have received money for which you are
accountable to Her Majesty and have not duly accounted for it, the particulars of
which are:
1. In , 19 , while an employee of the Post Office in Blank,
23'' See Part XI, page 13.
2412 See Part XI.
2513 See Part III.
2614 See Part IV.
2715 See Part II.
2816 See Part IV.
2917 See Callie v. Canada (1991) 2 F.C. 379, 397 when it was noted in respect of paragraph (d) that:
"The term "public money" has been enlarged to include sums of money which might not otherwise
come within the ordinary or everyday meaning of that term": see also generally Department of Justice
file #292759.
3018 See department of Justice file #278285.
3119 See Part IV.
321 This should read paragraph l(a.l).
332 This should read paragraph l(a.l).
343 The reference to paragraph 1(a) is presumably an error in drafting.
354 The reference in subsection 3(4) to paragraph 1(a), as opposed to paragraph (l)(a.l), is
presumably an error in drafting.
361 R.S.C. 1985, c. F-ll, s.5.

the Access to Information Act, which provides for an application fee not exceeding $25.
104^ See note 11 above.
10514 £Qst recovefy imc(er section 13 of the Financial Administration Act, seminar of the Department of
Justice in June 1987, H. Molot and M. Aitken, Justice 1987; Justice file (TB) 3866-59 opinion dated
December 5, 1991; Justice file (TB) 3866-28 opinion of January 18, 1993.
l061^ AAL-10.22.197, opinion of November 25, 1991.
1 0 7 S e eAppendix Bo fthe policy forexampleso frights and privileges.
10817 Mount Cook National Park Board v Mount Cook Motels Limited [1972] NZLR 481 and Webster v
Auckland Harbour Board [1987] 2 NZLR 129; PCO(J) 0/93-142 and TB 7980-2, opinion of
December 23, 1993; 316366 opinion of December 22, 1993; note that paragraph 6.3.2 of the policy
guidelines does not take account of section 19.1.
10918 [1977] 1 SCR41.
1 ' ° ^ J u s t i c e f i l e 2 9 2 0 0 0 5 9 - A A L - 0 7 1 o p i n i o n o f O c t o b e r 2 5 , 1 9 8 8 ; c o n c e r n i n g t h e Statistics Act and the

factors to be considered, Justice file 29200059-AAL-8.35 opinion of August 31, 1989; concerning the
Customs Act, Justice file 302679-AAL-8.176, opinion of October 19, 1989. Section 10 of the FAA and
independent authority to contract, by H.L. Molot, Justice Commercial and Property Law Seminary,
January 1989.
Report of the Auditor General, 1993, chapter 25.

112^ Cheticamp Fisheries Co-operative Ltd v Canada [1994] NSJ No 356, August 3, 1994, on appeal.
113^2 Guide to User Fees, Treasury Board Secretariat, page 12; note that this is not a Treasury Board
policy, but rather an informational document.
114^ See the Regulatory Impact Analysis Statement that follows SOR/94-512, Canada Gazette, Part II,
1994, p 2869.
115^ Justice file 319170 opinion of August 16, 1994.
116^ Second requirement of the policy, note 2 above.
1,72<^ Thome's Hardware Ltd v The Queen [1983] 1 SCR 106; Compagnie de Publication La Presse
Limitee v A G Canada, 63 DTC 1335 (C of E); also see Records of Proceedings, Third
Commonwealth Conference on Delegated Legislation, Westminster, 1989 and Eurig Estate (1994) 20
O.R. (3d) 385.
1l8^ idem, note 26, pp 122 and 123.
119^ The distinction between taxation and other statutory charges. T. Friesen, Administrative Law
Seminar, Justice, April 1994.
12°29 See note 17 above.
12 ^ See note 17 above.

12231 See note 24 above.
12332 Aerlinte Eireann Teoranta v Canada 68 DLR 4(th) 220.
12433 See note 26 above.
12534 Repayment of Receipts Regulations, SOR/81-920.
126j5 £ost Recovery pees Remission Order, Atomic Energy Control Board, SI/94-39.
127j6 AECB Cost Recovery Fees Regulations, 1993, SOR/93-163.
12837 Justice file (TB) 3866-20 opinion of February 28, 1994.
1 9Q~* 8
As an example of a net voting authority, see vote 1(f) of the Department of the Environment, S.C.
1994, c 33.
13QOQ
Memorandum of July 19, 1993 of the Treasury Board Secretariat on Retention of royalties and fees
from the licensing of Crown-owned intellectual property.
13140 Appendix B: see note 2 above. Also see the Report of the Auditor General, 1991, Chapter 9,
Financial Management and Control of Non-tax Revenue, paragraphs 9.57 to 9.73.
13241 Also see Guide to the Costing of Outputs in the Government of Canada, Office of the Comptroller
General, February 1989.
13342 Treasury Board information bulletin 4616-03-01 of November 19, 1993 on the prescribing of user
fees and charges under the FAA.
13443 However, the policy on charges does apply; see note 2 above.
13544 pQr exampie> see section 5 of the Resources and Technical Surveys Act, R.S.C. (1985), c R-7,
which authorizes the Minister to sell publications and maps and other documents issued by the
department; also see the following bills tabled in 1994: C-46 on the Department of Industry, s 18; C-52
on the Department of Public Works and Government Services, s 17; and C-53 on the Department of
Canadian Heritage, s 8; the provision, basically identical in the various bills, reads as follows: "8. The
Minister may, subject to any regulations that the Treasury Board may make for the purposes of this
section, fix fees and charges that the Minister considers appropriate in respect of products, services,
rights, privileges, regulatory processes or approvals and the use of facilities provided by the Minister,
the Department or any board or agency of the Government of Canada for which the Minister has
responsibility."
13645 Justice file 319173\9.7.30, opinion of October 15, 1993; Report of the Auditor General, 1993,
paragraphs 25.25 ff.
13746 r $ £ (1985), c S-25, under revision, Bill C-25 tabled in 1994.
13847 See also the Treasury Board Manual volume on Communications, Appendix C, and volume on
Materiel, Risk and Common Services, Part 3.
1394^ Justice file 6500-489, Reg Evans' opinion of March 28, 1991.
14049 Note 2 above, paragraph 5.1.13 of the guidelines.
l41^ See note 39 above.
See .the recommendations of the interdepartmental task force on assessing the value of intellectual
property, to appear in December 1994.
14352 See note 2 above, paragraph 5.1.19 of the guidelines; Justice file (TB) 3866-59 opinion of
February 4, 1992.
14453 Justice file 316375 1.21.196 opinion of March 17, 1993.
14554 Aerlinte, note 32 above, at page 228.
14655 Note 2 above, chapter two of the guidelines, and note 42.
1475^ Aerlinte, note 32 above, at page 225.
14857 See note 42 above, at page 4.
14958
Note 2 above, paragraph 2.3 of the guidelines.
1:>059 Air Canada v British Columbia [1989] 1 SCR 1161: in this decision, dealing with an application
for reimbursement of taxes by reason of the invalidity of the enactment, La Forest J. of the Supreme
Court stated that the law of restitution is not intended to provide windfalls to plaintiffs who have
suffered no loss since the burden of the tax was borne by their customers (pages 1202 and 1203). This
decision also examines the rule against the recovery of unconstitutional and ultra vires levies, stressing
that it is an exceptional rule that should not apply where a tax is extracted from a taxpayer through a
misapplication of the law, without distinguishing between errors of fact and of law (pages 1207 and
1208).
15160 Kenora (Town) Hydro Electric Commission v Vacationland Dairy Co-operative Ltd [1994] 1 SCR
80.
15261
idem, p 111.
15j>62 g 17, Financial Administration Act.
Justice file (TB) 3866-59 opinion of December 5, 1991.
155^4 Justice file 312575 12.23,227 opinion of March 2, 1992. The opinion refers to the following
publications: R. Flannigan, Crown Agent Status (1988) 67 CBR 229; P.W.Hogg, Liability of the
Crown. 2nd ed (Carswell, 1989), pp 247-264 (Crown Agents); P. Garant, Droit administratif. 3rd ed,
Yvon Blais, 1991, Vol 1, pp 133-153 (La qualite d'agent de la Couronne ou de mandataire du
gouvernement).
15665 C.R.C. c. 729, as amended by SORs/81-920 and 93-258.
15766 C.R.C. c. 730, as amended by SORs/83-829 and 93-258.
15867 ibid.
61320 (1974) F.C. 415.
61421 Johnson Enterprises Ltd. v. R. IV. Landmark Construction Ltd. (1993), 12 C.L.R. (2d) 107
(B.C.S.C.).
6I522 Citadel General Assurance Co. & Johns-Manville Canada Inc. (1983), 1 C.L.R. 169(S.C.C.).
61623 Elance Steel v. Falk Bros. (1990), 35 C.L.R. 225 (S.C.C.).
617lR.S.C. 1985, chap. C-46
6182 For example, A, an accountant in the office of the Paymaster-General, fraudulently omits to make
certain entries in his accounts, whereby he enables the cashier to retain large sums of money in his own
possession, and to appropriate the interest on such sums to himself after the time when they ought to
have been paid to the Crown. A commits a misdemeanour at common law: R. v. Bembridge (1783) 3
Doug 327; 22 St. Tr. 1-160, and an offence against section 122. A, a commissary general of stores,
makes contracts with B to supply stores, on the condition that B should divide the profits with A. A
commits a misdemeanour at common law: R. v. Valentine Jones (1809) 31 St. Tr. 251, and an offence
against section 122. See generally: Stephen, A Digest of the Criminal Law (Crimes and Punishments),
6th ed. (1904), pp. 90-91.
6l9^For example, in Regina v. Rogers (1972) the accused was a public servant charged with fraud
committed upon Prince Edward Island and Canada. On conviction, Rogers was sentenced to pay a fine
of $5,000.00. However, on appeal the court substituted a 4-year prison sentence. Chief Justice Trainor
said 2 Nfld. and P.E.I.R. 371 at p. 381: "The crime of the respondent was a breach of trust and one
which of its very nature struck at the basis of business life. Governments and business cannot function
unless their employees in positions of trust can be relied upon at all times. Doors can be locked against
intruders and money and valuable articles can be placed out of the reach of thieves. But unless trusted
employees live up to their responsibilities, business cannot survive."
62°4Osbore A Concise Law Dictionary, 5th ed. (1964), p. 97.
621^Salmond, Law of Torts, 9th ed. (1936), p. 8.
622^Bater v. Bater [1950] 2 All E.R. 458 at p. 459; Continental Insurance Co. v. Dalton Cartage Co.
[1982] 1 S.C.R 164. See generally: Sopinka, Lederman and Bryant, The Law of Evidence in Canada
(1992), pp. 143-146.
6237see, for example, Canada Evidence Act, R.S.C. c. C-5, section 25 (books), section 26(1) (books kept in
offices under Government of Canada), section 29(1) (records of financial institutions), section 30(1)
(business records). Further to this, see Ewart, Documentary Evidence in Canada (1984). This is the
best work on the subject.
624^These exceptions are united by two general principles: (1) there is some special necessity for the
admission of such evidence, and (2) there is some special guarantee of its credibility, to take the place
of those incidental to direct evidence, viz., the oath and cross-examination. Probably the main examples
are statements made by deceased persons, generally called "declarations". The instances of admissible
hearsay evidence may be stated as follows:- (1) admissions; (2) confessions; (3) declarations in course
of duties; (4) declarations against interest; (5) declarations as to pedigree; (6) declarations as to public
. and general rights; (7) declarations as to cause of death; (8) declarations as to contents of wills; (9)
evidence given in former proceedings; (10) statements in public documents; and, arguably, (11)
statements in ancient documents.
6259R v. Kahn [1990] 2 S.C.R 531; R. v. Smith [1992] 2 S.C.R. 915. See also Ethier v. Canada (R.C.M.P.
Commissioner) 11993] 2 F.C. 658 (C.A.)
62610 Canada Evidence Act, section 26(1) (are books kept in offices under Government of Canada),
section 29(1) (records of financial institutions), and section 30(1) (business records). These sections
have been considered by the courts, and the decisions should be consulted.
' The provision does not make the account stated a "settled account", which compromises the claim
between the parties. Such an account is binding on the parties, it cannot be re-opened, and the previous
causes of action are merged in it. In a case where the stating and agreeing of an account does not
amount to a compromise but only to an admission or to a new promise without new consideration,
while it enables a plaintiff to avoid technical objections to his original cause of action, it does not
enable a plaintiff to recover more than his just debt. Accordingly, if a defendant can show an error in an
account stated of the latter kind, he can re-open it: Bullen and Leake and Jacobs, Precedents of
Pleadings. 12th ed. (1975), pp. 187-188.
6281 ^ Bullen and Leake, Precedents of Pleadings. 3rd ed. (1868), p. 52 n.
62913 gy allowing a copy of the accounts stated and certified by the appropriate Minister or the Receiver
General to be evidence that the amount stated in the account together with interest is due and payable,
the subsection also overcomes the rule against admitting into evidence material that is hearsay. This
also follows from section 25(1) of the Interpretation Act, RS. c. 1-21, which provides that where an
enactment provides that a document is evidence of a fact without anything in the context to indicate that
the document is conclusive evidence, then, in any judicial proceedings, the document is admissible in
evidence and the fact is deemed to be established in the absence of any evidence to the contrary.
630)4 See the comments in note 11, supra.
63115 A deponent can be cross-examined on the contents ofthe affidavit in accordance with the ordinary
Rules of Court.
63216 Section 78 was formerly section 91 of the Financial Administration Act, S.C. 1980-81-82-83, c.
170. The 1983 amendments substantially amended section 91 ofthe Financial Administration Act,
R.S.C. 1970 cap. F-10. Before 1983, civil liability depended upon "wilful neglect of duty or gross
negligence". The 1983 amendment (now found in section 78) substantially lowered the threshold
of liability. Wilful neglect of duty or gross negligence could only be established in those cases
where it could be shown that the individual knew what the result of his conduct would be and
was recklessly and wantonly indifferent as to whether the result occurred.
6 3 3 A l t h o u g h section 7 8 is not in terms restricted to public servants, this is its practical effect; see
Friends of Oak Hammock Marsh Inc. v. Canada (Minister of Western Economic Diversification)
(1993) 67 F.T.R. 185 at p. 187.
6341
8 In some provinces, there are differences in court procedure if the claim is liquidated or
unliquidated.
63?19 jn some provinces, there are differences in court procedure if the claim is liquidated or
unliquidated.
63620 Friends of Oak Hammock Marsh v. Canada, supra, note 17. Section 76 would not apply to the
circumstances of that case, because Ducks Unlimited received money not for Her Majesty but for its
own account (to be applied in accordance with the terms of the agreement).
63721 gy section 737(2)(e), the sentencing court has a discretion to prescribe as a condition in a
probation order that the accused make restitution or reparation to any person aggrieved or injured by
the commission of the offence for the actual loss or damage sustained by that person as a result thereof.
This option is often of limited utility as the enforcement provision (section 740) requires proof beyond
reasonable doubt that the accused has wilfully failed or refused to comply with the order.
The preferable procedure is set out in section 725(1) ofthe Criminal Code, which provides that a court
that convicts or discharges under section 736 an accused of an offence may, on the application of a
Editor’s Note: Corrigendum released on January 25, 2012. Original judgment has
been corrected with text of corrigendum appended.
IN THE SUPREME COURT OF BRITISH COLUMBIA
2012 BCSC 67 (CanLII)

Citation: R. v. Porisky & Gould,
2012 BCSC 67
Date: 20120118
Docket: 25339-8
Registry: Vancouver
Regina
v.
Russell Anthony Porisky

Elaine Gould
Before: The Honourable Mr. Justice Myers
Corrected Judgment: The judgment was corrected at

paragraph 80 on January 25, 2012
Reasons for Judgment
Counsel for the Crown: Bruce Harper

Nils Preshaw
Russell Porisky: Appearing in person
Elaine Gould: Appearing in person
Place and Date of Trial: Vancouver, B.C.

November 14-18; 21-23; 28; 30;
December 1-2; 5-6; and 9, 2011
Place and Date of Judgment: Vancouver, B.C.
January 18, 2012
R. v. Porisky & Gould Page 4
I. THE CHARGES
[1] The Crown alleges that Mr. Porisky and Ms. Gould conducted business under
the name The Paradigm Education Group, which gave seminars and sold materials

urging others to structure their affairs as a “natural person, working in his own
capacity, under a private contract, for his own benefit”. Paradigm taught that money
earned under this arrangement was exempt from income tax.
[2] Between December 31, 2003 and December 4, 2008, the business is alleged
to have earned a net income of $ in respect of which no income tax was
paid by either of the accused. Mr. Porisky and Ms. Gould each stand charged with
evading both their own income taxes and those of the other, contrary to s. 239(1)(d)
of the Income Tax Act, R.S.C., 1985, c. 1 (5th Supp.). The income tax evasion
counts read as follows:
Count 1
Russell Porisky and Elaine Gould, being of the City of Chilliwack, Province of
British Columbia, between December 31, 2003 and December 4, 2008, did
wilfully evade or attempt to evade the payment of taxes imposed by the
Income Tax Act, by failing to report taxable income of Russell Porisky in the
amount of $ , and did thereby evade the payment of $
in income tax, contrary to section 239(1)(d) of the Income Tax Act.
Count 2
Russell Porisky and Elaine Gould, being of the City of Chilliwack, Province of
British Columbia, between December 31, 2003 and December 4, 2008, did
wilfully evade or attempt to evade the payment of taxes imposed by the
Income Tax Act, by failing to report taxable income of Elaine Gould in the
amount of $ , and did thereby evade the payment of $
in income tax, contrary to section 239(1)(d) of the Income Tax Act.
[3] Mr. Porisky and Ms. Gould have lived together since March 1998.
[4] The charges apportion the income of Paradigm equally between Mr. Porisky
and Ms. Gould. In particulars, the Crown further explained these counts as follows:
In Count 1, Porisky is charged as a principal (the taxes evaded were on his

income). Gould is charged as a party to that offence, both by not filing her
own tax returns (which would alert the Canada Revenue Agency to the
existence of Porisky’s income) and by other means.
Similarly, in Count 1 (sic), Gould is charged as a principal (the taxes evaded

were on her income) and Porisky is charged as a party to that offence, both
by not filing his own tax returns and by other means.
Although the second paragraph refers to Count 1, I take it to actually refer to

Count 2.

[5] Ms. Gould and Mr. Porisky are also charged under s. 327(1)(c) of the Excise
Tax Act, R.S.C., 1985, c. E-15, for failing to collect and remit Goods and Services
Tax on sales for the same period. The amount of GST that the Crown says should
have been remitted is $ .
[6] Finally, Mr. Porisky (alone) is charged under s. 464(a) of the Criminal Code
with counselling others to commit fraud by evading the payment of income tax. The
period encompassed in the charge is between December 31, 2000 and December 4,
2008.
[7] The charges were laid in December 2009 after a search of the accuseds’
residence on December 3, 2008. Up until June 2, 2011 Mr. Porisky was represented
sequentially by two counsel, with a short gap between them. Ms. Gould was
represented by counsel up until October 12, 2011. Mr. Porisky and Ms. Gould
represented themselves at the trial.
[8] Mr. Porisky testified on his own behalf. He acknowledged that Paradigm was
his alter-ego (his “representative”, to use his own word), so that is not in issue.
Ms. Gould did not testify or call any other evidence.
II. COUNT 1 – TAX EVASION BY MR. PORISKY RE: HIS OWN INCOME
[9] Section 239.(1)(d) of the Income Tax Act states:
239.(1) Every person who has…

(d) wilfully, in any manner, evaded or attempted to evade
compliance with this Act or payment of taxes imposed by this
Act…
is guilty of an offence…
cross-examination may be available:” (Wigmore 4th ed. Vol. IV

at p. 535).
[25] The accused were provided with Mr. Brunke’s spreadsheets ahead of his
testimony. The alternative to admitting the summary evidence in this case would

have had Mr. Brunke referring line by line to each bank statement and doing the
arithmetic “real-time” on the witness stand. That would have taken a good many
days and would have been almost impossible to absorb.
[26] Mr. Brunke first reviewed the bank statements and determined that a total of
$ was deposited into Mr. Porisky’s and Ms. Gould’s bank accounts from
December 31, 2003 to December 31, 2008. He then deducted from this:
a. all cash deposits, other than those that could be matched to a seized
Paradigm document that confirmed that the deposit was income;
b. all deposits for which no cheque was available; and
c. payments from the accuseds’ family.
Mr. Brunke treated the balance of $ as Paradigm’s gross revenue for

2004-2008.
[27] Included in the above revenue were deposits by cheque made out to
Mr. Porisky which did not contain any reference to Paradigm material or services
and could not be cross-referenced to a seized document, from payees who were not
known to be Paradigm educators or students. Mr. Brunke included this because
there was no indication that Mr. Porisky and Ms. Gould had any other source of
income other than Paradigm. He estimated that less than 5% of the cheques fell
into this category.
[28] Mr. Brunke then deducted the expenses of Paradigm which are summarised
as follows:
Category of Expense 2004-2008 total

Meals & Entertainment (50%) $ .29
Business Use of Home (20%) $ .87
Motor Vehicle (100%) $ .89

Office Supplies - General $ .55
Office Supplies - Minuteman Press $ .09
Professional Fees - Legal $ .00
Subcontract - Sherri Adams $ .44
Unaccounted Credit Card Payments $ .71
Hotel / Conference $ .66
Travel $ .73
Bank Fees $ .23
Interest $ .17
Total Allowed Expenses $ .63
Expenses which were obviously personal, such as fitness memberships and

groceries, were not included.
[29] None of the above evidence was challenged by Mr. Porisky in cross-
examination or in his own evidence.
[30] Neither Ms. Gould nor Mr. Porisky was paid a salary from Paradigm. Rather,
all of the money received from the operation of Paradigm was deposited into two
bank accounts in the joint names of both the accused, and two accounts in
Mr. Porisky’s name.
[31] The above resulted in a net business income of $ for the 2004 to
2008 taxation years.
[32] Mr. Brunke allocated the net income evenly between the accused and then
reduced the amount to factor in Canada Pension Plan contributions. This resulted in
the following net taxable income for each of the accused:
2004 2005 2006 2007 2008 Total

Taxable $ .76 $ .00 $ .72 $ .79 $ .32 $ .58
Victoria Paradigm educator sentenced for tax evasion and fraud 26/1/2016, 9:27 AM

Home  Newsroom  Convictions  Victoria Paradigm educator sentenced for tax evasion and fraud
Victoria Paradigm educator sentenced for tax

evasion and fraud
Vancouver, British Columbia, November 26, 2015... The Canada Revenue Agency (CRA) announced today that
Richard Cory Stanchfield, of Victoria, British Columbia, was sentenced on November 23, 2015, in Robson Square
Provincial Court, after being found guilty on one count of income tax evasion and one count of counselling others to
commit fraud. He was ordered to serve a 14-month conditional sentence, including nine months house arrest and 80
hours of community service. In addition, he was fined $31,012, representing 100% of the federal income tax evaded.
A CRA investigation determined that Mr. Stanchfield, an “educator” for the Paradigm Education Group (Paradigm),
failed to report $224,048 in taxable income for the 2003 to 2008 tax years, evading $31,012 in federal income tax.
During this period, Mr. Stanchfield taught students to follow the Paradigm scheme, counseling them on how to
restructure their affairs to avoid paying income tax. He was compensated with a percentage of each student’s gross
income in exchange for his teachings.
The preceding information was obtained from the court records.
The Canada Revenue Agency warns all Canadians to beware of individuals that try to convince you that Canadians do
not have to pay tax on the income they earn. These individuals, also known as tax protesters, not only fail to report
their own earnings, but they also conspire, counsel, and promote these tax schemes. Canadian courts have repeatedly
and consistently rejected all arguments made in these tax protester schemes. For those involved in tax protester
schemes, the CRA will reassess income tax and interest, and charge penalties. Individuals who plan to use the tactics
of tax protesters should know that this could have significant personal and financial consequences, including fines,
imprisonment, or seizure of goods. More information on tax protester schemes is available at www.cra.gc.ca/alert
under Tax Protesters.
Taxpayers who claim false expenses, credits or rebates from the government are subject to serious consequences.
They are liable not only for corrections to their tax returns and payment of the full amount of tax owing, but also to
penalties and interest. In addition, if convicted of tax evasion, the court may fine them up to 200% of the tax evaded
and sentence them for up to a five-year jail term.
If you have ever made a tax mistake or omission, the CRA is offering you a second chance to make things right
through its Voluntary Disclosures Program (VDP). If you make a valid disclosure before you become aware that the
CRA is taking action against you, you may only have to pay the taxes owing plus interest. More information on the
VDP can be found on the CRA's website at www.cra.gc.ca/voluntarydisclosures.
Further information on convictions can also be found in the Media Room on the CRA website at
www.cra.gc.ca/convictions.
-30-
For media information

Heidi Hofstad
Communications Manager
(604) 666-9389
Date modified:
2015-11-26
http://www.cra-arc.gc.ca/nwsrm/cnvctns/bc/bc151126-eng.html Page 1 of 1
IN THE SUPREME COURT OF BRITISH COLUMBIA
Citation: Sandra June Gibbs v. Regina,

2006 BCSC 481
Date: 20060323

Docket: 22544
Registry: Vancouver
Between:
Sandra June Gibbs
Appellant
And:
Regina
Respondent
Before: The Honourable Madam Justice Koenigsberg
Reasons for Judgment
The Appellant Appearing on her own behalf
Counsel for the Crown Dan Meneley
Date and Place of Hearing: January 25-27, 2006

Vancouver, B.C.
Sandra June Gibbs v. Regina Page 2
OVERVIEW
[1] The appellant, Sandra Gibbs, who is a tax preparer, was tried and convicted
of four offences pursuant to section 238(1) of the Income Tax Act R.S.C. 1985, c.1

(the “Act”) for failing to comply with a notice of requirement that had been served on
her. She faced four counts, two in relation to a failure to comply with requirements
that she file her 1996 and 1997 personal income tax returns, and two counts in
relation to a failure to comply with requirements that she file corporate returns for
Count On Us Bookkeeping Services Inc. (the “Company”), of which she was a
director.
[2] Section 238(1) of the Act reads:
Every person who has failed to make a return as and when required by
or under this Act or a regulation or who has failed to comply with
subsection 116(3), 127(3.1) or (3.2), 147.1(7) or 153(1), any of
sections 230 to 232 or a regulation made under subsection 147.1(18)
or with an order made under subsection (2) is guilty of an offence and,
in addition to any penalty otherwise provided, is liable on summary
conviction to
(a) a fine of not less than $1,000 and not more than $25,000;
or
(b) both the fine described in paragraph (a) and imprisonment for a
term not exceeding 12 months.
FACTS
[3] Since the late 1980s, the appellant and Sharon Enman were business
partners. In 1992, they incorporated the entity known as Count on Us Book Keeping
Services Inc.
[4] A similar set of charges were laid against Ms. Enman as were laid against the
appellant. Originally, the trials of both women were to be heard at the same time.
[42] There is therefore no basis upon which I could find s. 244 of the Act
unconstitutional.
[43] The appellant also argues that the form provided to the public by CCRA, upon

which tax returns are to be recorded does not comply with specific statutory
requirements found in the Act. Pursuant to s. 150(1) of the Act, an individual must
file a return of income that is in a prescribed form with the Minister. This section
provides:
Subject to subsection (1.1), a return of income that is in prescribed

form and that contains prescribed information shall be filed with the
Minister, without notice or demand for the return, for each taxation year
of a taxpayer.
[44] Section 244(16) of the Act provides:
Every form purporting to be a form prescribed or authorized by the

Minister shall be deemed to be a form authorized under this Act by the
Minister unless called in question by the Minister or by a person acting
for the Minister or Her Majesty.
[45] The appellant submits that there is no such prescribed form under the Act
and that for this reason she is not able to comply with the legal requirement that she
file her return of income on such a form. She argues that the T-1 form, upon which
all taxpayers file their income tax returns, is not a prescribed form.
[46] This issue was considered by Silverman J. in R v. Watson 2005 BCSC 1225.
The appellant in that case made the same argument in relation to the absence of a
prescribed form. The Crown conceded that there was no regulation prescribing the
T-1 form and that there was no documentation whereby the Minister expressly
authorized the form. However, after considering the definition of ”prescribed” found
in s. 244(16) of the Act, and after considering the decision of the British Columbia
Court of Appeal in R v. Point (1957), 119 C.C.C. 117, Silverman J. concluded that
the T-1 form is a prescribed form within the meaning of s. 244(16).

[47] The facts of this case are not distinguishable from the facts before Silverman
J. in Watson. For this reason, I must conclude that a T-1 form is a prescribed form
and that the appellant would have been in compliance with the Act had she filed the
required income tax returns on this form.
Fairness of the trial
[48] The appellant also raises a number of issues which arose from the conduct of
the trial and a number of rulings made by the trial judge. These challenges attack
the fairness of the trial and fall into several categories. I will deal with them by
category.
Did the trial judge err in not permitting the appellant to audiotape or videotape
the proceedings and in not ordering that transcripts be provided to the
appellant at the expense of the Crown during the trial?
[49] The appellant was self represented during the entirety of the pre-trial and trial
process. The trial lasted 13 or 14 days. There were numerous motions brought by
the appellant necessitating rulings. The trial began on October 9, 2001 and
completed on June 6, 2003. The essence of the Crown’s case came in through one
witness whose evidence in chief came in on one of those days. The cross-
examination of this witness occurred over three sitting days. There were delays to
accommodate motions for disclosure during his evidence.

Russell’s Book of Authorities - Tab 10 Page 1
Her Majesty The Queen (Appellant) v. Redpath Industries Ltd. and

Dominion Sugar Company Ltd. (Respondents).
84 DTC 6349
Quebec Superior Court (Criminal Division)
June 18, 1984
Offences -- Wilful evasion -- Incorporation of off-shore company to carry on activities of respond-

ent companies -- Off-shore company's profits declared as dividends -- Crown alleging that profits of
off-shore company really those of respondent companies -- No evidence of scheme to evade pay-
ment of taxes -- Income Tax Act, S.C. 1970-71-72, c. 63, ss. 239(1)(d) and 244(4).
During the period from October, 1966 to April 1, 1972, the respondent, taxpayer companies R and
D were engaged in the business of purchasing, refining and trading in sugar. Company D was a ful-
ly owned subsidiary of company R. A British company, which controlled company R, desired to
utilize surplus funds that were available to the taxpayer companies. An offshore company, company
A, was incorporated in Bermuda to carry on the activities of the taxpayer companies and pass the
tax savings on to the parent company in England. Company A had a Board of Directors but no em-
ployees or physical installation. Sugar contracts were negotiated by the purchasing department of
company R on behalf of company A, the official purchaser. Profits earned by company A were de-
clared as exempt dividends from an offshore company by company R in its tax returns. The taxpay-
er companies were charged with wilfully evading the payment of tax on the profits earned by com-
pany A. The Quebec Court of Sessions of the Peace (83 DTC 5117) acquitted the taxpayer corpora-
tions on the basis that the Crown failed to prove the existence of a sham or scheme to evade taxes.
The Crown appealed to the Quebec Superior Court (Criminal Division).
Held: The Crown's appeal was dismissed. The Court held that there must be prima facie evidence
that tax was undisputably payable before it could decide if tax had been evaded. The Court was un-
able to find that company A was a sham. The paid up capital of company A was not insignificant.
Transactions between the taxpayer companies and company A were substantiated by documentation
and occurred at an independently determined fair market value. The corporate realities of parent
companies controlling subsidiaries and interlocking boards of directors did not necessarily point to a
sham. The Court also noted that the experts in taxation and government committees were aware of
the possibility of offshore companies being used to minimize tax but did not change the law until
after the taxation years under consideration. The Court classified the taxability of the taxpayers' off-
shore dividends as very debatable and therefore declined to find any tax evasion. The Crown's ap-
peal was accordingly dismissed.
Page 2
Counsel: B. Pateras, Q.C., for the appellant; Philip Vineberg, Q.C. Colin Irving, Q.C. and Morris
Fish for the respondents.
Before: Bergeron, J.
BERGERON, J.: This Court is seized with an appeal by the Crown, under Part XXIV of the
Criminal Code, from a judgment rendered on December 14, 1982, by the Court of the Sessions of
the Peace of Montreal, acquitting Respondents of a summary conviction charge reading (as later
amended during the trial); as follows:
REDPATH INDUSTRIES LIMITED, LES INDUSTRIES REDPATH LIMI-

TEE (formerly Canada and Dominion Sugar Company Limited) of One, West-
mount Square, Suite 1212, Montreal,
[ DTC Printed Version Reference: YEAR = 84 PAGE = 6350 ]
Quebec, and DOMINION SUGAR COMPANY LIMITED. of 285 Merritt Ave-

nue, Chatham, Ontario, between October 1, 1966 and April 1, 1972, at Montreal.
District of Montreal, in the Province of Quebec, and elsewhere in Canada, wilful-
ly evaded the payment of taxes imposed by the Income Tax Act, R.S.C. 1952,
Chapter 148 and its amendments, for taxation years 1967 to 1971, both inclusive.
to wit, by omitting to declare in their income tax returns taxable income of
$7,404,635.97, thereby evading payment of $3,036.857.91 in income tax, com-
mitting thereby an offence contrary to Section 239(1)(d) of the said Act.
(The underlining of the word 'taxable' is mine as representing the amendments brought by its ad-
dition in the course of the presentation of the defence.)
Introduction
For the sake of abbreviation, I shall refer to various parties involved as 'Redpath' for Redpath In-
dustries Ltd., to 'Dominion' for Dominion Sugar Limited, a wholly owned subsidiary of Redpath; to
'T & L' for Tate and Lyle Limited, of London, England (holding company) as the parent company
of Redpath -- I shall also refer to Redpath's affiliated company, incorporated in Bermuda, Albion
Company Limited, as 'Albion'.
As already noted and underlined, the original charge of 'omitting to declare income' was later
amended, at the request of the Crown and at the defence stage, by judgment of the trial Court, over
the objections of the defence, by adding the word 'taxable' to the word 'income'.
For what it would have been worth, for the sake of clarity and to reflect the true nature of the
charge, if such a charge exists in law, and in view of the tax returns filed and their manner of filing
and the evidence adduced, it might have been more factual to couch the information and state in the
charge 'by omitting to declare income as taxable income'.
Page 3
In fact, and as it was duly demonstrated, Respondents did declare income of some $7,400,000,
indicating its source, nature and origin, e.g. in the form of dividends received from a non-Canadian,
non-resident corporation, Albion, of Bermuda, indicating that such a company was affiliated to Re-
spondents in a non-arm's length capacity, and Respondents claiming, in their annual returns, a tax
exemption under Section 28(1)(d) of the I.T.A., as it then existed, for the period of five years, 1967
to 1971 inclusively.
Before entering into the merit of the case and because there exists here no discussion as to the
fact that total income, exact almost to a penny, was duly declared as to its source and nature and an
exemption claimed, it does call for a quick examination of the general concept of fiscal legislation
regarding income, the duties and rights it imposes and confers on both parties, the taxpayer and the
National Revenue, and the basic principles normally applied and followed in matters of taxation.
The main thrust of the Act is to compel the taxpayer to declare his income, no matter what the
source may be, and the taxpayer has no choice but to declare it as faithfully as his activities engen-
dered. In doing so, he is entitled to take into account whatever exemptions are recognized by the
Act and he may claim the benefit of such exemptions in his tax return.
The Revenue, upon such disclosure, may not agree with the taxpayer's exemptions claim and may
move to reject such claim by notice of assessment, opening the door to legal civil proceedings to be
decided on the merit of the respective contentions of the parties, by the Appeal Board and the Ex-
chequer Court (for the years involved), later on by the Tax Appeal Board (now the Tax Court of
Canada) and the Federal Court.
These authorities constitute the forum where adverse contentions are debated as to taxability or
not.
The obligation to declare his revenue on the part of the taxpayer is unquestionable and wilfull
failure to do so may entail the commission of an offence of evading compliance with the Act, which
is not to be confused with an avoidance of tax.
The case law is replete with prosecution for failure to declare, but it is worth noting that in regard
to a charge of tax evasion, not a single reported case could be found based on wilfull omission to
declare income such as in the present case where the total income is declared, and declared as non-
taxable by virtue of exemption simultaneously claimed in tax returns.
This mutism in the case law seems to me to stem from logic in that, once a total income is duly
declared, whatever qualifications are attached to it, the taxpayer has
satisfied his main and principal obligation. He may wrongly claim an exemption, possibly opening
the way to other recourses if the exemption claim is tainted with fraud, etc., but the necessary ele-
ment for an offence of omission to declare is not present to support a charge of that nature.
We have to deal here with a specific charge of 'failure to declare' and not with the manner in
which an exemption was claimed in tax returns, since it is clear from the record that a true and exact
income was admittedly reported.
A criminal court is not the forum to determine income taxability and to make determinations as to
rights to tax assessment or absence of rights of assessment involved. In a tax evasion charge, it must
appear prima facie from the evidence that the taxability is clear-cut, obvious, indisputable, unques-
Page 4
tionable from lack of reporting, before entering the examination of the other facts of the charge, e.g.
whether the undisputable taxability, based on income gained proven and undeclared, leads to a con-
clusion beyond a reasonable doubt that it was wilfully omitted by a taxpayer in his tax returns.
If such basis is not present and there exists an obligation to enter into the examination of the mer-
it of a possible assessment in respect of a declared income in order to weigh whether a taxpayer is
susceptible to taxation or not, may or may not take advantage of claimed exemptions a criminal
court usurps its function and appropriates itself of a jurisdiction which it does not possess.
We are faced in this instance, with a strict problem of taxability, originating from the creation of
an affiliated company, a foreign offshore corporation, a device widely used over more than the last
half century by numerous large and multinational corporations, to conduct some of their interna-
tional commercial operations and as a means of recuperating tax-free dividends, due to a certain
elasticity, if not to say laxity, in the Canadian legislation as it then existed.
The case law abounds with instances where, in taxation matters, the Revenue Department has
constantly frowned upon the practice and, not seeing eye to eye with the taxpayer's exemption
claims, has on multiple occasions set the civil machinery in motion to contest the validity of the ex-
emption claim pursuant to a declaration so qualified by the taxpayer; in all such cases, always intro-
duced in civil jurisdictions, the Revenue has often relied on the theory of 'sham', an artifice to cam-
ouflage the true nature of a taxpayer's operations through a corporate dummy or puppet.
But never, as well as I could ascertain, has a criminal prosecution been instigated, based on a to-
tally declared income couched in returns duly filed as required by law but qualified by direct and
unequivocal indications of the source and nature of the income, and the dispositions of the law on
which the taxpayer relies to claim tax exemption.
If the true income has been declared, what opposite views the parties may adopt as to their re-
spective merit, should not be the concern of a criminal court, but that of civil tribunals, and the mat-
ter could end right there as far as an information for 'failure to disclose' is concerned.
However, it would not be fair and just to the parties and counsels, who not only went through an
original lengthy criminal trial, scrutinized some nine volumes of transcript evidence, hundreds of
documentary exhibits, filed voluminous arguments, notes, submissions of considerable jurispruden-
tial authorities and further verbally argued before this Court for a period of more than two and a half
weeks, if I did not summarize the facts and the principles of law involved so as to determine wheth-
er in some criminal fashion and as per the information charged, a mandatory or prohibitive disposi-
tion of the I.T.A. ha's been infringed.
Facts
Redpath is and has always been a sugar refiner, buying at large throughout the world, raw sugar,
96% pure, for the purpose of refining and eventual sale for Canadian consumption. It is not a sugar
trader per se, e.g. to simply buy and sell sugar in its original form.
Dominion is a wholly owned subsidiary of Redpath, a paper corporation with a capitalization of
$500.00, kept on the shelf and totally inactive until the incorporation of Albion; its sole activity
thereafter was
to become a sometime assignee of dividends received by Redpath from Albion.

Tab G
Russell’s
Book of Documents
for
Notice of Objection

NOTE
Most of the documents supporting Russell’s Notice of Appeal are in

Apu’s Theory, Part 1 (see page 13 of Tab C). Again, you can print
and/or download the PDF file of Part 1 from SSRN (Social Sciences
Research Network). SSRN is the world’s largest on-line research
paper repository:
https://ssrn.com/abstract=2800623
or
http://dx.doi.org/10.2139/ssrn.2800623

Other documents are available from various Government of Canada

websites, or by searching the Internet.
Tab H
Department of
Justice’s
Intro Letter

Department of Justice Ministere de la Justice
Canada Canada
B.C. Regional Office Phone:(604) 666-0555

900 - 840 Howe Street Fax:(604) 666-2214
Vancouver, British Columbia
V6Z 2S9
February 10, 2016
BY REGULAR MAIL
William Russell
Avenue
Surrey, British Columbia
V4A
Dear Sir:
Re: William Russell v. Her Majesty The Queen

Tax Court of Canada Appeal No. 2015-5542(IT)G
Our File No. 8399757
I write further to our telephone conversation this afternoon.
During our conversation, I explained that the Respondent intends to bring a motion to
strike your notice of appeal on the grounds that it fails to disclose reasonable grounds for
the appeal and to allow the appeal to continue would be an abuse of the court's process.
In your notice of appeal, you allege that the revenue you received from Dr. William
Russell Naturopathic Inc. is exempt from taxation because the work you performed for
the company was under a private contract and you specifically did not consent to
converting your revenue from private property to profit from an office. In our view, this
is a variation of a tax protestor argument that has been resoundingly rejected by the Tax
Court.
During our conversation, I made reference to previous Tax Court decisions where the
court allowed motions to strike notices of appeal that contain similar arguments. I
enclose for your review copies of three cases: Hovey Ventures Inc. v. Her Majesty the
Queen 2007 TCC 139; Cassa v. Her Majesty the Queen 20ljTCC 43; and Rive v. Her
Majesty the Queen 20 lit TCC 243.
In Cassa, the Tax Court considered a notice of appeal that engaged in the "so-called 'de-
taxer' language."1 The court allowed the motion to strike and wrote:
I consider those types of arguments an abuse of the Court's processes. Such

"song and dance" routines hinder and limit the availability of Court
resources for those self-represented litigants who are making an honest
' Cassa, 2014 TCC 43, at para. 9.

- 2 -
attempt to advance their appeals through the Court system in a timely

manner.2
The arguments advanced in Cassa and the other cases referred to above are not materially
different than the arguments raised in your notice of appeal.
Accordingly, we intend to bring a motion to strike your notice of appeal. However,

before we do so, I would like to provide you with the opportunity to consider amending
your notice of appeal to address any other arguments you may wish to rely on. To that
end, you may wish to seek independent legal advice.
Finally, as we discussed, the Tax Court has advised that the following dates are available
for a motion: April 4, 5, 6, and April 12-15. We will be in touch during the week of
February 22, 2016 to confirm a motion date, if necessary.
Yours truly,
Max Matas
Counsel
Tax Law Services
c. CRA
2 Supra, at para. 14.

Tab I
Russell’s Reply to
the Department of
Justice:
Not an
“OPCA Litigant”

February, 16, 2016

BY NOVEX COURIER

Max Mates
Department of Justice Canada
B.C. Regional Office
900-840 Howe Street
Vancouver, BC V6Z 2S9

Dear Mr. Mates

Re: William Russell v. Her Majesty The Queen
Tax Court of Canada Appeal No. 2015-5542(IT)G
Our File No. 8399757

I have received your letter dated February 10, 2016 as a follow up to our
conversation the afternoon of February, 10, 2016.

You indicated that the Respondent intends to bring a motion to strike my notice of
appeal on the grounds that it fails to disclose reasonable grounds for appeal and that
to allow the appeal to continue would be an abuse of the court’s process.

In our conversation you said that my appeal was similar to other “natural persons
arguments” and that the appeal would be an abuse of the court’s process. You
included three Tax Court decisions where the court allowed motions to strike
notices of appeal that you state contain similar arguments. I would like to point out
that these three cases are not similar to my position.

Hovey Ventures Inc. v. Her Majesty the Queen 2007 TCC 139, argues that “a “natural
person” is not subject to pay tax under the Act.”. Nowhere in my pleadings have I
stated that I am a “natural person” or that I am not subject to the Income Tax Act.

In Cassa v. Her Majesty the Queen 2013 TCC 43, paragraph #9 states that the Appeal
contains disjointed and meaningless statements and assertions such as:

“His documents and submissions engaged in the so-called “de-taxer” language”. Those
include:

- “ the Appellant, Adrian Cassa, acted as an agent for an undisclosed Principal”
- “ Principal is a living-soul, flesh-and-blood man”
- “Principal is commonly called Adrian of the Cassa family”,
- “Principle earned wages in exchange for labour”,
- “the wages were collected by Appellant:,
- “Appellant incurred labour expenses”,
- “Appellant did not use or benefit from any Expenses”.

And continuing on, the Appellant claims:

- “an individual is not defined as being a man under the ITA”
- “ in Section 248(1) of the ITA a business is an “undertaking of any kind
whatever”,
- “acting as an agent is a business”,
- “without Principal, Appellant could not continue acting as an agent”,
- “ without Appellant, Principal could not continue to labour”.

None of this language was used in my Notice of Appeal pleadings or in my 109-page
Notice of Objection dated April 27, 2015. I have no idea what Cassa is saying.

In paragraph #10 it states that “endless statutory provisions” were used with no
indication of how they were intended. In contrast, my pleadings have precise
provisions in which I intend to rely on.

Paragraph #13 states, “Among other such groups, the Meads decision identifies
specifically the so-called ‘de-taxers’ or those attempting to avoid income tax
obligations as well as the “freeman on the land” notion and the double or split person
concept.” I am not attempting to avoid income tax obligations; I do not know what a
“freeman on the land” is, or what a double or split person concept is. I have not
mentioned any of these concepts in my Notice of Appeal pleadings.

In Rive v. Her Majesty the Queen 2014, TCC 243, paragraph 2, the issues are whether
the Act has jurisdiction over an individual. In contrast to Rive I agree the Act has
jurisdiction over me. My pleadings do not indicate that I believe in involuntary
servitude or involuntary contracts as stated in paragraph 2(17) in Rive. In
paragraph #3, “the Crown submits that this notice of appeal has the same fatal defects
that the court considered in Cassa v. The Queen, 2013 TCC 43 ABQB 571”; I have
already addressed this above.

In your letter February 10, 2016, paragraph 2, you stated that “you allege that the
revenue you received from DR. WILLIAM RUSSELL NATUROPATHIC INC. is exempt
from taxation because the work you performed for the company was under a private
contract and you specifically did not consent to converting your revenue from private
property to profit from an office.” To clarify, I believe I am subject to the ITA, but my
income earned under my private contract is “exempt income” as defined by the ITA,
and that I did not consent to convert my private property into “public money”
within the meaning of s. 2 of the Financial Administrative Act (“FAA”). I cannot find
any case so far that has put forward such a position and which also relies on the
FAA.

Finally, my position agrees with all ten positions made by CRA’s web site on “tax
protestors”. This was discussed point-by-point in my 109-page filing of my exempt
income received under my private contract, under Chapter 45, “Compare to CRA
Alert on Tax Protestors: Theory Validated?” at pages 62 to 65.

In summary, the three cases you have quoted do not support your view that my
appeal uses “de-taxer language” but in fact supports my position that my pleadings
do not fall into a so-called “de-tax” or “tax protestor” arguments.

As per our discussion, I have submitted a slightly amended Notice of Appeal.

Yours Truly,

William Russell

As ITA “legal representative “ with Social Insurance Number

Tab J
Department of
Justice
Written
Representations
to Strike

BY HAND / PAR PORTEUR
2015-5542(IT)G
AA \ A C ' ' : ; \ V J I )
, COUri CANAL; _ !_ 1 ] QT
TAX COURT OF CANADA VANCOUVER. C. ! i AD/
BETWEEN:
WILLIAM RUSSELL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
RESPONDENT'S WRITTEN REPRESENTATIONS
Overview
1. The Amended Notice of Appeal is scandalous, frivolous or vexations, or is

otherwise an abuse of process and should be struck. Further, the Amended Notice
of Appeal has failed to disclose reasonable grounds for appeal. The Amended
Notice of Appeal alleges that income the Appellant received from his related
corporation in exchange for services rendered was paid under a private contract
that is exempt from taxation under the Income Tax Act. The Appellant's legal
argument is a variation of the concepts employed by so-called "de-taxers". This
argument has been resoundingly discredited by this court as without merit and an
abuse of the court's process.
- 2 -
Submissions
Facts
2. In the Amended Notice of Appeal, the Appellant admits:
(a) he was a director and shareholder of Dr. William Russell Naturopathic

Inc. (the "Company");1
(b) at all material times, he performed duties as manager of the Company

under a contract;2
(c) throughout the taxation years under appeal, he invoiced the Company for
work he performed under the contract;3
(d) the Company paid the following amounts to him under the contract:4
2010-$1 000;
2011-$ 000; and
2012-$ 000;
(collectively, the "Contract Income")
(e) he reported business income from the Energetic Matrix Church of

Consciousness and employment income paid for work as a director of the
Company on his T1 returns for the taxation years under appeal;5 and
(f) he did not report the Contract Income on his T1 returns for the taxation
years under appeal.6
1 Amended Notice of Appeal, at para. 1.

3 Amended Notice of Appeal, at para. 10 and Appendix G.
5 Amended Notice of Appeal, at paras. 4, 5 and 7.
6 Amended Notice of Appeal, at paras. 12, 13, 155 and 180 and Appendix D.
-3 -
3. The Minister reassessed the Appellant's 2010, 2011 and 2012 taxation years to
include the Contract Income.7
4. In the Amended Notice of Appeal, the Appellant argues that it was legally
impossible for him to report the Contract Income on a T1 Return, as the T1
Return makes reference to a '"social insurance number' styled all in lower case
letters."8 Further, the Contract Income was "private property" which he did
consent to be converted into "profit from an office."9 Further, as he did not claim
any expenses and his income from the Company did not include any dividends,
the Contract Income was "exempt income" under subsection 248(1) of the Income
Tax Act}0
5. The Appellant attached a copy of the "Private Contract" between himself and the
Company as Appendix B to the Amended Notice of Appeal. The contract
provides that the Appellant:
.. .consents to being engaged for his services in his capacity as a natural

person and does not consent to accepting or performing the duties of an
'office or employment' in the capacity of an 'officer', or any other entity
defined in the Income Tax Act of Canada for provincial or federal income
tax purposes [emphasis added].11
6. The contract between the Appellant and the Company was developed by the
Paradigm Education Group.12
Motion to Strike
7. The Amended Notice of Appeal ought to be struck pursuant to Rules 53(l)(b), (c)
and (d) for failing to disclose reasonable grounds for appeal, for being scandalous,
frivolous or vexations, or for otherwise being an abuse of process. The Appellant
argues that he is not liable to pay tax on income received from his related

8Amended Notice of Appeal, at para. 13.
9 Amended Notice of Appeal, at paras. 22 and 136.
10 Amended Notice of Appeal, at para. 135-136.
11 Amended Notice of Appeal, Appendix B, p. 22, at para. B. 3.
-4-
corporation in exchange for services rendered because it was paid under a

"Private Contract" and is therefore exempt from taxation. This argument, or close
variations, has been rejected by this court as an abuse of process.13 Further, it is
plain and obvious that the Amended Notice of Appeal has no hope of success as
this court has found similar arguments to be without merit.14
8. An order to strike a Notice of Appeal in its entirety under Rule 53 is an

extraordinary remedy. The following rules apply:15
(a) The facts alleged in the impugned pleading must be taken as true.
(b) To strike out a pleading or part of a pleading under Rule 53, it must be
plain and obvious that the position has no hope of succeeding. The test is a
stringent one and the power to strike out a pleading must be exercised with
great care.
(c) A motions judge should avoid usurping the function of the trial judge in
making determinations of fact or relevancy. Such matter should be left to
the judge who hears the evidence.
9. The application of the words "scandalous, frivolous or vexatious, or abuse of the

process of the Court", as found in Rule 53, "should be reserved for the plainest
and most egregiously senseless assertions."16
10. The Appellant's Amended Notice of Appeal is premised on the plainest and most
egregiously senseless assertions, such that the entire pleading is scandalous,
frivolous or vexatious and an abuse of the process of the Court.
11. The Appellant's arguments are variations of arguments that have been
resoundingly rejected as either abusive or without merit. In Meads v. Meads,
Associate Chief Justice Rooke identified a category of "vexatious litigants" which
13 Tuckv. Her Majesty the Queen 2007 TCC 418, at para. 18; Rive v. Her Majesty the Queen 2013 TCC
243, at para. 5; Cassa v. Her Majesty the Queen 2013 TCC 43, at para. 14.
'4 Tuck, at para 10; Hovey Ventures', Cassa, at para. 13.
15 Sentinel Hill Productions (1999) Corporation v. Her Majesty the Queen 2007 TCC 742, at para. 4.
-5-
he termed Organized Pseudolegal Commercial Argument (OPCA) litigants, who

"employ a collection of techniques and arguments promoted and sold by 'gurus'
.. .to disrupt court operations and to attempt to frustrate the legal rights of
governments, corporations, and individuals."17
12. In Meads, Associate Chief Justice Rooke identified one of the gurus as Russell
Porisky of the "the Paradigm Education Group", who advanced the erroneous
concept that a taxpayer could avoid paying tax by structuring their affairs so that
they were a "natural person, working in his own capacity, under a private
contract, for his own benefit".18 The Appellant invokes the same discredited
concepts in his Amended Notice of Appeal (and appendices) in so far as it alleges
that the Contract Income is exempt from taxation because he performed work for
the Company as a natural person under a private contract (which was drafted by
the Paradigm Education Group).
13. In Meads, Associate Chief Justice Rooke also categorized various flawed OPCA
arguments, variations of which are found in the Amended Notice of Appeal. One
common OPCA argument is that legal obligations require consent of the litigant
(or taxpayer) and the absence of consent provides the taxpayer with immunity
from those legal obligations.19 This argument finds its way in the Amended
Notice of Appeal as it is argued that the Appellant did not consent to convert his
income into public money or profit from an office.20
14. A second common OPCA argument is the double or split person argument. In
Meads, Associate Chief Justice Rooke explained "A strange but common OPCA
concept is that an individual can somehow exist in two separate but related
states."21 This argument is found in the Amended Notice of Appeal as it is argued
that "Canadians also have dual individual capacity"22 and the Appellant is "two
16 SentinelHill Productions, at para. 11.

17 Meads v. Meads, 2012 ABQB 571 (Court of Queen's Bench), at para. 1.
18 Meads, at para. 88.
19 Meads, at para. 379-416.
20 Amended Notice of Appeal, at paras. 22, 105 and 136
21 Meads, at para. 417.
- 6 -
legal persons" and has a "second individual capacity as an officer."23 As

explained in Meads, "Canadian law does not provide for a person to have two
aspects."24
15. In the Tax Court, variations of the OPCA arguments have been rejected as:
(a) "a waste of time"25
(b) "without merit"26
(c) "an abuse of process of this Court"27
(d) "absurd... without merit... total and utter nonsense"28 and
(e) "absolutely no merit to any of [the appellant's] arguments."29
16. In Cassa, the Tax Court granted a motion to strike a notice of appeal that made
similar arguments and "engaged in the so-called 'de- taxer' language."30 The
Tax Court wrote:
I consider those types of arguments an abuse of the Court's processes. Such

"song and dance" routines hinder and limit the availability of Court
resources for those self-represented litigants who are making an honest
attempt to advance their appeals through the Court system in a timely
manner.31
17. The Tax Court has also struck notices of appeal that rely on variations of the same
arguments as either an abuse of process or lacking merit in Tuck, Hovey Ventures
and Rive.
23 Amended Notice of Appeal, at para. 102 and 104.

24 Meads, supra, at para. 422.
25 Tuck, at para. 17.
26 Hovey Ventures, at para. 13.
27 Rive v. Her Majesty the Queen 2013 TCC 243, at para. 5.
28 Cassa, at para. 13.
29 Bertucci v. Her Majesty the Queen 2014 TCC 230, at para. 7.
-7-
18. The Amended Notice of Appeal does not disclose a reasonable cause of action
and to allow this litigation to continue would be an abuse of the court's processes.
The Appellant has admitted the facts that support the assessments at issue: the
Appellant performed work for the Company and received remuneration from the
Company in exchange for the work performed. The issues identified at
paragraphs 27 to 33 of the Amended Notice of Appeal all rely to the Appellant's
argument that the Contract Income is not subject to taxation because it was under
a private contract and he did not consent it be converted to public money.32 This
argument has no merit.
19. For the 2012 taxation year, the Appellant has only admitted that he received
$ 000 from the Company under the contract; however, the Appellant was
assessed for unreported income of $ ,000. To the extent that his admitted
income is less than the assessed income, there may be a triable issue. However,
the Amended Notice of Appeal does not identify this discrepancy as an issue in
this appeal. Further, there is no similar discrepancy for the 2010 and 2011
taxation years.
20. Further, the Amended Notice of Appeal's defect are such that it cannot be saved
by simple amendments or by striking select passages. The Appellant's abusive
argument permeates all parts of the Amended Notice of Appeal. It is not the duty
of a judge to redraft pleadings.33
21. The Amended Notice of Appeal is equally abusive and without merit with respect
to gross negligence penalties. While the burden of establishing the facts that
support gross negligence penalties is on the Minister, and the court may decline to
strike a notice of appeal where it is not plain and obvious that the Minister will
32 Further, the Tax Court does not have jurisdiction to consider the Appellant's entitlement to the British
Columbia Climate Action Tax Credit, raised in paragraph 30 of the Notice of Appeal.
33 Sweet v. Canada [1999] F.C.J. 1539 (FCA), cited in Hovey Ventures, supra, at para 9 and Tuck, supra at
para 12.
- 8 -
meet this burden,34 in the present case, the paragraphs of the Amended Notice of
Appeal pertaining to gross negligence penalties should be struck.
22. The Appellant's arguments on gross negligence penalties, at paragraphs 164 to

173, rely on the same flawed arguments as elsewhere in the Amended Notice of
Appeal. The Appellant submits that he is not liable to pay gross negligence
penalties as he never consented to receiving income from the Company as "public
money" as if he were an "officer."35 As written above, this is a variation of a
flawed OPCA argument that has been struck by the Tax Court for being abusive.
23. The Appellant has also admitted sufficient facts in the Amended Notice of Appeal
to support gross negligence penalties. The Minister must demonstrate that the
Appellant's conduct was tantamount to intentional acting or indifference as to
whether the law was complied with or not.36 The Appellant failed to report
material amounts of income from the Company in each taxation year under
appeal. The Appellant was aware of his obligations to report taxable income,
demonstrated by the fact that he reported income from other sources. The sole
reason for his failure to report the Contract Income was his view that this income
was exempt from taxation because the work he performed for the Company was
under a private contract and he specifically did not consent to converting his
revenue from private property to profit from an office. This justification for
failing to report taxable income is nonsensical and completely without merit and
is demonstrative of the Appellant's indifference as to whether the law was
complied with or not.
24. In the alternative, all paragraphs not relevant to gross negligence penalties should
be struck. Specifically, the following paragraphs should be struck: 27, 28, 29, 30,
31, 33, 91-113, 114-163, and 174-182.
34 Brown v. The Queen, 2014 FCA 301, at para. 20.

36 Venne v. The Queen, 84 DTC 6247, at para. 37.
-9-
Conclusion
25. For these reasons, the motion to strike the Amended Notice of Appeal should be
allowed, with costs to the Respondent.
ALL OF WHICH IS RESPECTFULLY SUBMITTED
DATED at the City of Vancouver, the Province of British Columbia, this y of

March, 2016.
William F. Pentney, Q.C.

Deputy Attorney General of Canada
Solicitor for the Respondent
Per:
Max Matas
Counsel for the Respondent
B.C. Regional Office
900 - 840 Howe Street
V6Z 2S9
Telephone: (604) 666-0555

Facsimile: (604)666-2214

Tab K
Department of
Justice
Book of Authorities

2015-5542(IT)G
2015-5541(IT)G
TAX COURT OF CANADA
BETWEEN:
WILLIAM RUSSELL,
LORA RADDYSH,
Appellants,
and
Respondent.
RESPONDENT'S BOOK OF AUTHORITIES
Address for the Appellants: Address for the Respondent:
Avenue Department of Justice

Surrey, British Columbia B.C. Regional Office
V4A 900 840 Howe Street
V6Z 2S9
William Russell & Lora Raddysh Max Matas

Appellants Counsel for the Respondent
INDEX
TAB AUTHORITY
Legislation:
1- Tax Court of Canada Rules (General Procedure), SC)R/90688a, as amended:
Rule 53(1)
Case Law:
2. Sentinel Hill Productions (1999) Corporation and Robert Strother v. Her Majesty
the Queen, 2007 TCC 742
3. Meads v. Meads, 2012 ABQB 571 [excerpts]
4. Tuck v. Her Majesty the Queen, 2007 TCC 418
5. Hovey Ventures Inc. v. Her Majesty the Queen, 2007 TCC 139
6. Cassa v. Her Majesty the Queen, 2013 TCC 43
7. Rive v. Her Majesty the Queen, 2013 TCC 243
8. Bertucci v. Her Majesty the Queen, 2014 TCC 230
9. Brown v. Her Majesty the Queen, 2014 FCA 301
10. Venne v. Her Majesty the Queen, [1984] 1 C.T.C. 223

CANADA
CONSOLIDATION CODIFICATION
Tax Court of Canada Rules Regies de la Cour canadienne

(General Procedure) de Timpot (procedure generate)
SOR/9Q-688a DQRS/90-688a
Current to March 3, 2016 Ajourau 3 mars 2016
Last amended on February 7, 2014 Derniere modification le 7 fevrier 2014
Published by the Minister of Justice at the following address: Publie par le ministre de la Justice a I'adresse suivante :
http://laws-lois.justice.gc.ca http://Iois-laws.justice.gc.ca
Tax Court of Canada Rules (General Procedure) Regies de la Cour canadienne de I'impot (procedure generate)
Pleadings Actes de procedure
Rules of Pleadings — Applicable to all Pleadings Ragles applicables a tous les actes de procedure
Sections 51-53 Articles 51-53
(3) An allegation that is inconsistent with an allegation (3) Une partie ne peut faire valoir une allegation qui est
made in a party's previous pleading or that raises a new incompatible avec une allegation faite dans un acte de
ground of claim shall not be made in a subsequent plead procedure anterieur ou qui souleve un nouveau motif que
ing but by way of amendment to the previous pleading. par voie de modification de l'acte de procedure anterieur.
SOR/93-96, s. 9. DORS/93-96, art. 9.
Demand for Particulars Demande de precisions

52 (1) Where a party demands particulars of an allega 52 (1) Si une partie demande des precisions sur un fait
tion in the pleading of an opposite party, and the oppo allegue dans un acte de procedure de la partie adverse et
site party fails to supply them within thirty days, the que celleci ne les produit pas dans les trente jours, la
Court may order particulars to be delivered within a Cour peut en ordonner leur production dans un delai de
specified time. termine.
(2) The demand for particulars shall be in Form 52 and (2) La demande de precision est redigee selon la for
shall be filed and served in accordance with these rules. mule 52 et elle est deposee et signifiee en conformite avec
SOR/2014-26, s. 4. les presentes regies.
DORS/2014-26, art. 4.
Striking out a Pleading or other Radiation d'un acte de procedure ou

Document d'un autre document
53 (1) The Court may, on its own initiative or on appli 53 (1) La Cour peut, de son propre chef ou a la demande
cation by a party, strike out or expunge all or part of a d'une partie, radier un acte de procedure ou tout autre
pleading or other document with or without leave to document ou en supprimer des passages, en tout ou en
amend, on the ground that the pleading or other docu partie, avec ou sans autorisation de le modifier parce que
ment Facte ou le document:
(a) may prejudice or delay the fair hearing of the ap a) peut compromettre ou retarder l'instruction equi
peal; table de l'appel;
(b) is scandalous, frivolous or vexatious; b) est scandaleux, frivole ou vexatoire;
(c) is an abuse of the process of the Court; or c) constitue un recours abusif a la Cour;
(d) discloses no reasonable grounds for appeal or op d) ne revele aucun moyen raisonnable d'appel ou de
posing the appeal. contestation de l'appel.
(2) No evidence is admissible on an application under (2) Aucune preuve n'est admissible a l'egard d'une de
paragraph (l)(d). mande presentee en vertu de l'alinea (l)d).
(3) On application by the respondent, the Court may (3) A la demande de l'intime, la Cour peut casser un ap
quash an appeal if pel si:
(a) the Court has no jurisdiction over the subject mat a) elle n'a pas competence sur l'objet de l'appel;
ter of the appeal;
b) une condition prealable pour inteijeter appel n'a
(b) a condition precedent to instituting an appeal has pas ete satisfaite;
not been met; or
c) l'appelant n'a pas la capacite juridique d'introduire
(c) the appellant is without legal capacity to com ou de continuer Tinstance.
mence or continue the proceeding. DORS/2014-26, art. 5.
SOR/2014-26, s. 5.
Current to March 3, 2016 22 A jour au 3 mars 2016

Last amended on February 7, 2014 Derniere modification le 7 fevrier 2014
Docket: 20063455(IT)G
BETWEEN:
SENTINEL HILL PRODUCTIONS (1999) CORPORATION,

in its capacity as designated member of
SENTINEL HILL 1999 MASTER LIMITED PARTNERSHIP,
Appellant,
and

Respondent,
AND
BETWEEN:
ROBERT STROTHER,
Appellant,
and

Respondent.
Motions heard together on December 4, 2007, at Toronto, Ontario.
Before: The Honourable D.G.H. Bowman, Chief Justice
Appearances:
Counsel for the Appellant: Warren J.A. Mitchell, Q.C.

David R. Davies
Counsel for the Respondent: Robert Carvalho

Michael Taylor
Page: 2
ORDER
Upon motions made by counsel for the respondent for an order under Rule 53
of the Tax Court of Canada Rules (General Procedure) to strike out 22 full
paragraphs and a part of one other paragraph of the further amended notice of appeal
of Sentinel Hill Productions (1999) Corporation, in its capacity as designated
member of Sentinel Hill 1999 Master Limited Partnership;
And to strike 18 paragraphs of the further amended notice of appeal of

Robert Strother;
The motions are dismissed with costs payable by the Crown to the appellants
in any event of the cause.
The appellants have 30 days from the date of this order in which to file replies.
Signed at Ottawa, Canada, this 19th day of December 2007.
"D.G.H. Bowman"
Bowman, C.J.
Citation: 2007TCC742
Date: 20071219
BETWEEN:
SENTINEL HILL PRODUCTIONS (1999) CORPORATION,

in its capacity as designated member of
SENTINEL HILL 1999 MASTER LIMITED PARTNERSHIP,
Appellant,
and

Respondent,
AND
BETWEEN:
ROBERT STROTHER,
Appellant,
and

Respondent.
REASONS FOR ORDER
Bowman. C.J.
[1] In these motions the respondent seeks an order under Rule 53 of the Tax
Court of Canada Rules (General Procedure) to strike out 22 full paragraphs and a
part of one other paragraph of the further amended notices of appeal of Sentinel
Hill Productions (1999) Corporation ("Sentinel Hill") and 18 paragraphs of the
further amended notice of appeal of Robert Strother.
[2] Rule 53 reads as follows:
Page: 2
Striking out a Pleading or other Document Radiation d'un acte de procedure ou d'un autre
document
53. The Court may strike out or expunge all 53. La Cour peut radier un acte de procedure
or part of a pleading or other document, with or ou un autre document ou en supprimer des
without leave to amend, on the ground that the passages, en tout ou en partie, avec ou sans
pleading or other document, autorisation de le modifier parce que l'acte ou
le document:
(a) may prejudice or delay the fair a) peut compromettre ou retarder

hearing of the action, l'instruction equitable de l'appel;
(b) is scandalous, frivolous or b) est scandaleux, frivole ou vexatoire;

vexatious, or
(c) is an abuse of the process of the c) constitue un recours abusif a la Cour.

Court.
[3] Essentially the impugned paragraphs contain assertions that the appellants
entered into certain transactions involving Canadianbased production services in
respect of fulllength motion picture films and television productions and that in
doing so they relied upon a number of advance income tax rulings issued by the
Canada Revenue Agency ("CRA") in respect of the investment in limited
partnerships. For the purposes of the motions I shall assume that the limited
partnerships were tax shelters as defined in section 237.1 of the Income Tax Act.
[4] I shall begin by outlining what I believe are the principles to be applied on a
motion to strike under Rule 53. There are many cases in which the matter has been
considered both in this court and the Federal Court of Appeal. It is not necessary to
quote from them all as the principles are well established.1
(a) The facts as alleged in the impugned pleading must be taken as true
subject to the limitations stated in Operation Dismantle Inc. v.
Canada, [1985] 1 S.C.R. 441 at 455. It is not open to a party attacking
a pleading under Rule 53 to challenge assertions of fact.
(b) To strike out a pleading or part of a pleading under Rule 53 it must be

plain and obvious that the position has no hope of succeeding. The
1 Among the cases referred to by counsel are The Queen v. Enterac Property Corporation, 98 DTC 6202;
Niagara Helicopters Ltd. v. The Queen, 2003 DTC 513 at 514; Gauthier v. The Queen, 2006 DTC 3050.
Page: 3
test is a stringent one and the power to strike out a pleading must be
exercised with great care.
(c) A motions judge should avoid usurping the function of the trial judge
in making determinations of fact or relevancy. Such matters should be
left to the judge who hears the evidence.
(d) Rule 53 and not Rule 58, is the appropriate rule on a motion to strike.
[5] We have here a number of paragraphs that allege that advance rulings were
obtained and that the transactions in issue conformed to the advance rulings.
Counsel for the respondent seeks, in these motions, to dispute those allegations of
fact. Among the paragraphs in the Sentinel Hill's further amended notice of appeal
that the respondent seeks to strike are the following:
4.A. SHEC also owns all the shares of Sentinel Hill Productions Cornoration
and Sentinel Hill Productions II Cornoration. Sentinel Hill Productions
Corporation is the sole general partner of the Sentinel Hill 1998 Master
Limited Partnership. Sentinel Hill Productions 11 Corporation is the sole
general partner of the Sentinel Hill 19982 Master Limited Partnership.
36. On October 6, 1998 (the "October 1998 Ruling") and December 18, 1998
(the "December 1998 Ruling") the Rulings Division of the CRA issued
binding advance income tax rulings to SHEC in respect of transactions
that were the same, in all material respects, as those concluded by SHEC
with respect to the Appellant and the Partnership.
36.A. The October 6. 1998 Ruling was in respect of transactions undertaken bv

SHEC. its subsidiary Sentinel Hill Productions Corporation, and the
Sentinel Hill 1998 Master Limited Partnership, among others.
36.B. The December 18. 1998 Ruling was in respect of transactions undertaken
bv SHEC. its subsidiary Sentinel Hill Productions II Corporation, and the
Sentinel Hill 19982 Master Limited Partnership, among others.
36.C. The rulings issued to SHEC were in resnect of. among the other things, the
existence of a partnership, the computation of atrisk amounts, and the
nonapplicabilitv of the matchable expenditure rules.
36.D. The CRA Rulings Division's widelvknown and accepted practice in

issuing rulings to promoters of multiple partnerships was to issue a single
ruling which was valid in resnect of all transactions implemented bv that
Page: 4
promoter that were the same, in all material respects, as those outlined in
the ruling.
36.E. SHEC paid a fee to the CRA in respect of each ruling.
37. In December 1999, counsel for SHEC. the Appellant, the Partnership and
the PLPs began discussions and corresponded with representatives of the
Rulings Division of CRA to refresh the October 1998 Ruling and the
December 1998 Ruling. Those discussions culminated in the Rulings
Division of CRA issuing another binding advance income tax ruling on
February 21, 2000.
38. SHEC. the Appellant, the Partnership, the PLPs, and the Limited Partners
relied on the October 1998 Ruling, the December 1998 Ruling and the
preliminary discussions and correspondence for the February 2000 Ruling
in investing in the partnerships and in undertaking the Productions.
39. The Minister intended that, and knew or ought to have known that, SHEC.
the Appellant, the Partnership, the PLPs, and the Limited Partners would
rely on the October 1998 Ruling, the December 1998 Ruling and the
preliminary discussions and correspondence for the February 2000 Ruling
in investing in the partnerships and in undertaking the Productions.
39.A. The Minister based his assumptions in reassessing on a comparison of the

facts set forth in the rulings with the facts as he found them in the
transactions here in issue.
50.A. The 1999 PLP Determinations and the 1999 Determinations were issued
notwithstanding that the transactions accorded with the advance income
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paragraphs 36 to 39A hereof, on which the Appellant and the Limited

Partners relied.
58.A. The 2000 PLP Determinations and the 2000 Determination were issued
notwithstanding that the transaction accorded with the advance income tax
rulings, practice, correspondence and discussions described in
paragraphs 36 to 39A hereof, on which the Appellant and the Limited
Partners relied.
59. The issues to be decided in this appeal in respect of the 1999

Determination are:
Page: 5
(a) whether the Minister is estopped from raising all or any part of the 1999
Determination due to the Minister's practice of issuing binding advance
income tax rulings to the Sentinel Hill group and others, in particular by
the issuance of the October 1998 Ruling, the December 1998 Ruling and
the February 2000 Ruling;
(a.D whether the October 6. 1998 Ruling, the December 18. 1998 Ruling, the
CRA's practice in issuing such rulings and the related correspondence and
discussions constitute an agreement binding on the Minister to assess the
Partnership and the Limited Partners in accordance therewith and, if so.
whether the Minister in fact assessed in accordance with the agreement
thereby established:
60. The issues to be decided in this appeal in respect of the 2000

Determination are:
(a) whether the Minister is estopped from raising all or any part of the 2000
Determination due to the Minister's practice of issuing binding advance
income tax rulings to the Sentinel Hill group and others, in particular by
the issuance of the October 1998 Ruling, the December 1998 Ruling and
the February 2000 Ruling, and in light of the recommended revisions to
the structure made by the CRA Rulings Division in 1998;
fa.D whether the October 6. 1998 Ruling, the December 18. 1998 Ruling, the
CRA's practice in issuing such rulings and the related correspondence and
discussions constitute an agreement binding on the Minister to assess the
Partnership and the Limited Partners in accordance therewith and, if so.
whether the Minister in fact assessed in accordance with the agreement
thereby established:
60.A. Whether solicitor and client or other special costs should be awarded to
the Appellant because of the issuance of the Determinations and
Confirmations thereof and the prosecution of this appeal by the
Respondent notwithstanding the advance income tax rulings, discussions
and correspondence described in paragraphs 36 to 39.A hereof and relied
on by the Appellant and the Limited Partners.
62. The Appellant, its related entities and the limited partners of the
Partnership relied on the advance income tax rulings issued by the Rulings
Division of the CRA, and the Minister knew of that reliance. Accordingly,
Page: 6
the Minister is estopped from issuing the 1999 Determination and the
2000 Determination in contravention of the rulings.
62.A. The rulings, practice, correspondence and discussions described in

paragraphs 36 to 39.A hereof constituted an agreement binding on the
Minister to assess in accordance therewith, which the Minister has
breached in issuing the 1999 Determination and the 2000 Determination.
The 1999 Determination and 2000 Determination, to the extent thev are
inconsistent with that agreement, should be vacated.
72. The Appellant says that in issuing the Determination in issue and
prosecuting this appeal notwithstanding the advance income tax rulings,
correspondence and discussions referred to in paragraphs 36 to 39A
hereof, the Respondent has acted in an improper and vexatious manner for
which solicitor and client or other special costs should be awarded to the
Appellant.
[6] The paragraphs which the respondent seeks to strike from the Strother notice
of appeal are similar. Most of the paragraphs attacked by the respondent contain
allegations of fact which must be taken as true for the purposes of this motion. If
the respondent wishes to challenge the facts alleged, a section 53 motion is not the
place in which to do so. It is at trial where a judge hearing the evidence can
determine the correctness, relevancy and weight to be assigned to the evidence
adduced in support of the allegations.
[7] The respondent seeks to strike out the paragraphs on the basis that they
contain references to the doctrine of estoppel. It is clear that estoppel cannot
prevail against the law. Mr. Mitchell, counsel for the appellants, agrees with this
and so do I.
[8] Mr. Mitchell quotes from a decision I rendered a number of years ago in
Goldstein v. The Queen, 96 DTC 1029 at 1033:
There is much authority relating to the question of estoppel in tax matters and no
useful purpose would be served by yet another review of the cases. I shall
endeavour however to set out the principles as I understand them, at least to the
extent that they are relevant. Estoppels come in various forms — estoppel in pais,
estoppel by record and estoppel by deed. In some cases reference is made to a
concept of "equitable estoppel", a phrase which may or may not be accurate. It is
sufficient to say that the only type of estoppel with which we are concerned here
is estoppel in pais. In Canadian Superior Oil Ltd. v. Paddon-Hughes Development
Page: 7
Co. Ltd. [1970] S.C.R. 932 at 939940 Martland, J. set out the factors giving rise
to an estoppel as follows:
The essential factors giving rise to an estoppel are I think:
(1) A representation or conduct amounting to a representation

intended to induce a course of conduct on the part of the person to
whom the representation is made.
(2) An act or omission resulting from the representation, whether

actual or by conduct, by the person to whom the representation is
made.
(3) Detriment to such person as a consequence of the act or

omission.
Estoppel is no longer merely a rule of evidence. It is a rule of substantive law.

Lord Denning calls it "a principle of justice and of equity."
It is sometimes said that estoppel does not lie against the Crown. The statement is
not accurate and seems to stem from a misapplication of the term estoppel. The
principle of estoppel binds the Crown, as do other principles of law. Estoppel in
pais, as it applies to the Crown, involves representations of fact made by officials
of the Crown and relied and acted on by the subject to his or her detriment. The
doctrine has no application where a particular interpretation of a statute has been
communicated to a subject by an official of the government, relied upon by that
subject to his or her detriment and then withdrawn or changed by the government.
In such a case a taxpayer sometimes seeks to invoke the doctrine of estoppel. It is
inappropriate to do so not because such representations give rise to an estoppel
that does not bind the Crown, but rather, because no estoppel can arise where such
representations are not in accordance with the law. Although estoppel is now a
principle of substantive law it had its origins in the law of evidence and as such
relates to representations of fact. It has no role to play where questions of
interpretation of the law are involved, because estoppels cannot override the law.
Lastly, in a footnote near the end of the judgment (at p. 1034):
I leave aside entirely the question of advance rulings which form so important and
necessary a part of the administration of the Income Tax Act. These rulings are
treated by the Department of National Revenue as binding. So far as I am aware
no advance ruling that has been given to a taxpayer and acted upon has ever been
repudiated as against the taxpayer to whom it was given. The system would fall
apart if he ever did so.
Page: 8
[9] Whether the factual components giving rise to an estoppel exist is a matter
for the trial judge.
[10] So far as the words scandalous, frivolous or vexatious are concerned, the
most frequently quoted (and authoritative) passages are the following:
An excellent statement of the test for striking out a claim under such provisions is
that set out by Wilson J. in Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959
(S.C.C.), at p. 980:
... assuming that the facts as stated in the statement of claim can be
proved, is it "plain and obvious" that the plaintiffs statement of claim
discloses no reasonable cause of action? As in England, if there is a
chance that the plaintiff might succeed, then the plaintiff should not be
"driven from the judgment seat". Neither the length and complexity of
the issues, the novelty of the cause of action, nor the potential for the
defendant to present a strong defence should prevent the plaintiff from
proceeding with his or her case. Only if the action is certain to fail
because it contains a radical defect. . . should the relevant portions of a
plaintiffs statement o f claim b e struck o u t . . . .
The test is a stringent one. The facts are to be taken as pleaded. When so taken,
the question that must then be determined is whether there it is "plain and
obvious" that the action must fail. It is only if the statement of claim is
certain to fail because it contains a "radical defect" that the plaintiff should
be driven from the judgment seat.... [emphasis added]
Odhavji Estate v. Woodhouse, [2003] 2 S.C.R. 263, 2003 SCC 69.
[11] I do not see how, in light of the jurisprudence on Rule 53, it can be said that
it is plain and obvious that the arguments and facts advanced in the further
amended notices of appeal fall within any of the provisions of Rule 53. Whether I
agree that the factual components of estoppel exist or whether the advance rulings
constitute agreements is not germane to the disposition of these motions. The
appellants should be entitled to advance such arguments at trial on the basis of all
the evidence. However much jurisprudence may surround the words "scandalous,
frivolous or vexatious, or abuse of the process of the Court", they are nonetheless
strong, emotionally charged and derogatory expressions denoting pleading that is
patently and flagrantly without merit. Their application should be reserved for the
plainest and most egregiously senseless assertions as for example in
William Shawn Davitt v. The Queen, 2001 DTC 702. Where senior and
experienced counsel advances a proposition of fact or law in a pleading that merits
serious consideration by a trial judge, it is at least presumptuous and at most
insulting and offensive to force counsel to face the argument that the position is so
Page: 9
lacking in merit that it does not even deserve to be considered by a trial judge. It is
a deplorable tactic for the Crown, as soon as it sees a legal argument that it does
not like, to move to strike. As I said in Sackman v. The Queen, 2007 TCC 455, it is
this sort of skirmishing that is putting tax litigation out of the reach of ordinary
people. I do not wish to see this court turned into a forum for procedural
manoeuvring. I repeat what was said in Satin Finish Hardwood Flooring (Ontario)
Limited v. The Queen, 96 DTC 1402 at 1405:
There was no justification for bringing this motion. It serves no purpose within .
the context of this litigation. The time that has been spent on this exercise in
procedural oneupmanship would have been better spent, following the filing and
serving of a reply, in conducting an examination for discovery in which the
evidentiary basis of the appellant's challenge to the assessment could readily have
been ascertained. The rules of this court, which are designed to facilitate, not
impede, the expeditious determination of fiscal disputes, should not be used to carry
out unproductive procedural manoeuvring.
[12] The respondent's position is ambivalent. I asked counsel if he was saying

that advance rulings were not binding or that the appellants had not conformed to
them. His answer was "Both". If the argument is that they do not apply to the
appellants or that their terms had not been complied with, this is a factual matter
that contradicts the allegations in the notices of appeal. It cannot be raised on these
motions. It must be decided on evidence at trial. If the respondent is now seeking
to establish that advance rulings can be repudiated by the Minister after decades of
reliance by taxpayers upon them, this proposition, which would startle most
practitioners, should be tested in a full trial and not a preliminary motion. This
preliminary motion is certainly not the time or place to discuss the complex issues
arising out of the Minister's remarkable position. The rulings process, which was
created by Revenue Canada and has been enormously beneficial to taxpayers in
creating certainty in predicting the tax consequences of commercial transactions,
constitutes a fundamental cornerstone of Canadian tax administration. The idea
that a motions judge could, on the basis of a one hour argument without evidence,
demolish one of the essential underpinnings of our system is, quite frankly,
appalling.
[13] The magnitude of this question transcends the boundaries of a preliminary

motion and is indeed of a greater importance in the field of taxation than any I
have seen in many years.2
2 There is a very full discussion of the question in an article in the University of Toronto Faculty of Law
Review, Vol. 57 / number 2 / Spring 1999. Holding Revenue Canada to its word: Estoppel in Tax Law,
Page: 10
[14] The motions are dismissed with costs payable by the Crown to the appellants
in any event of the cause.
[15] The appellants have 30 days from the date of this order in which to file
replies.
Signed at Ottawa, Canada, this 19th day of December 2007.
"D.G.H. Bowman"
Bowman C.J.
Glen Loatzenheiser. A similar question in the United Kingdom is discussed in the Cambridge Law Journal
53(2), July 1994, page 273: The Revenue giveth the Revenue taketh away.
Court of Queen's Bench of Alberta
Citation: Meads v. Meads, 2012 ABQB 571
Date: 20120918
Docket: 4803 155609
Registry:
Edmonton
Between:
Crystal Lynne Meads
Appellant
and
Dennis Larry Meads
Respondent
Editorial Notice: On behalf of the Government of Alberta

personal data identifiers have been removed from this
unofficial electronic version of the judgment.
Reasons for Decision

of the
Associate Chief Justice
J.D. Rooke
[...]
Where there is no common power, there is no law, where no law, no injustice.
Force, and fraud, are in war the two cardinal virtues.
The laws are of no power to protect them, without a sword in the hands of a man, or men, to
cause those laws to be put in execution.
And law was brought into the worldfor nothing else but to limit the natural liberty of particular
men in such manner as they might not hurt, but assist one another, and join together against a
common enemy.
Thomas Hobbes, Leviathan (Forgotten Books, 2008), at pp. 87, 147, 184
L Introduction to Organized Pseudolegal Commercial Argument f"OPCA"l Litigants
[1] This Court has developed a new awareness and understanding of a category of vexatious
litigant. As we shall see, while there is often a lack of homogeneity, and some individuals or
groups have no name or special identity, they (by their own admission or by descriptions given
by others) often fall into the following descriptions: Detaxers; Freemen or FreemenontheLand;
Sovereign Men or Sovereign Citizens; Church of the Ecumenical Redemption International
(CERI); Moorish Law; and other labels there is no closed list. In the absence of a better
moniker, I have collectively labelled them as Organized Pseudolegal Commercial Argument
litigants ["OPCA litigants"], to functionally define them collectively for what they literally are.
These persons employ a collection of techniques and arguments promoted and sold by 'gurus'
(as hereafter defined) to disrupt coun operations and to aueiripi Lo frusiraie trie legal rights of
governments, corporations, and individuals.
[2] Over a decade of reported cases have proven that the individual concepts advanced by
OPCA litigants are invalid. What remains is to categorize these schemes and concepts, identify
global defects to simplify future response to variations of identified and invalid OPCA themes,
and develop court procedures and sanctions for persons who adopt and advance these vexatious
litigation strategies.
[3] One participant in this matter, the Respondent Dennis Larry Meads, appears to be a
sophisticated and educated person, but is also an OPCA litigant. One of the purposes of these
Reasons is, through this litigant, to uncover, expose, collate, and publish the tactics employed by
the OPCA community, as a part of a process to eradicate the growing abuse that these litigants
direct towards the justice and legal system we otherwise enjoy in Alberta and across Canada. I
will respond on a pointbypoint basis to the broad spectrum of OPCA schemes, concepts, and
arguments advanced in this action by Mr. Meads.
[4] OPCA litigants do not express any stereotypic beliefs other than a general rejection of
court and state authority; nor do they fall into any common social or professional association.
Arguments and claims of this nature emerge in all kinds of legal proceedings and all levels of
Courts and tribunals. This group is unified by:
1. a characteristic set of strategies (somewhat different by group) that they employ,
2. specific but irrelevant formalities and language which they appear to believe are
(or portray as) significant, and
3. the commercial sources from which their ideas and materials originate.
This category of litigant shares one other critical characteristic: they will only honour state,
regulatory, contract, family, fiduciary, equitable, and criminal obligations if they feel like it. And
typically, they don't.
[5] The Meads case illustrates many characteristic features of OPCA materials, in court
conduct, and litigation strategies. These Reasons will, therefore, explain my June 8, 2012
decision and provide analysis and reasoning that is available for reference and application to
other similar proceedings.
[6] Naturally, my conclusions are important for these parties. However, they also are
intended to assist others, who have been taken in/duped by gurus, to realize that these practices
are entirely ineffective; to empower opposing parties and their counsel to take action; and as a
warning to gurus that the Court will not tolerate their misconduct.
[I] As a preliminary note, I will throughout these Reasons refer to persons by their 'normal'
names, except to illustrate various OPCA motifs and concepts. OPCA litigants frequently adopt
unusual variations on personal names, for example adding irrelevant punctuation, or using
unusual capital and lower case character combinations. While OPCA litigants and their gurus put
special significance on these alternative nomenclature forms, these are ineffectual in law and are
meaningless paper masks. Therefore, in these Reasons, I will omit spurious name forms, titles,
punctuation and the like.
[]
III. Overview of these Reasons
[60] The remainder of these Reasons address aspects of the OPCA phenomenon, and the
courts' responses, closing with the application of these Reasons to the Meads litigation. There
are four main parts to these Reasons:
The OPCA Phenomenon
[II] This part of the Reasons is a detailed review of the OPCA community, its membership,
organization, and known history. It sets out the Court's understanding of persons who affiliate
with OPCA concepts, what traits they do and do not share, and how they organize themselves.
[62] This community has "guru" leader, and follower / customer, cohorts. Groups of persons
who have similar beliefs join together into "movements". Known gurus and movements are
identified and described.
Indicia of OPCA Litigants. Litigation, and Strategies
[63] The documentary material and incourt conduct of OPCA litigants involves very unusual
and stereotypic motifs. The second part of these Reasons identifies these 'fingerprints' that
characterize OPCA activities. The problematic character of OPCA litigation and litigants may
warrant special court procedures; some possibilities are surveyed.
Judicial Response to OPCA Concepts and Arguments
[64] This part of the Reasons surveys existing caselaw that reports and rejects OPCA
strategies and concepts. Those strategies and concepts are grouped by their shared themes and
mechanisms. The theoretical basis and operation of certain more elaborate OPCA schemes are
examined in detail.
1651 No Canadian court has accepted an OPCA concept or approach as valid. This part of the
decision identifies a common basis to reject these ideas as a category: they directly attack the
inherent jurisdiction of Canadian courts. That fact is also a basis for why OPCA schemes are
inherently vexatious, and provide evidence that may potentially lead to orders for contempt of
court. Remedies for OPCA litigation and litigation strategies are reviewed.
Summary and Direction
[66] There is no place in Canadian courts for anyone who advances OPCA concepts. The last
part of these Reasons suggests how judges, lawyers, and litigants may respond to persons who
adopt and advance th ese concepts. I also comment directly to those in the OPCA community
both gurus and their followers with the hope that these Reasons will lead them to more
productive and successful interaction with the courts, government, and their fellow citizens.
IV. The OPCA Phenomenon
[67] I will first engage in an overview of the OPCA community, its composition, and their
concepts. Certain of these observations are generalizations that flow from the more specific
examples and materials that make up the bulk of these Reasons. In other instances, this
information reflects the experiences of justices of this Court that have come to my attention as
the supervising administrative Justice of this Court.
[68] Members in the OPCA community appear surprisingly unified by their methodology and
objectives. They are otherwise diverse. OPCA litigants appearing in our Court may be anything
from educated professionals to retired senior citizens. They may be wealthy or poor. The famous
are not immune; for example the American action movie actor Wesley Snipes adopted OPCA
techniques in an attempt to defeat his income tax obligations: United State v. Wesley Trent
Snipes et al., No. 5:06cr00022WTHGRJl (U.S.D.C. M.D. Fl., February 1, 2008). Snipes
presently is serving a three year prison sentence for income tax evasion.
[69] In Canada, this category of litigation traces into the late 1990's, representing the spread
of concepts that emerged much earlier in the United States. Our Court's experience has been that
persons involved in the OPCA community often hold highly conspiratorial perspectives, but
there is no consistency in who is the alleged hidden hand. Another uniform OPCA characteristic
appears to be a belief that ordinary persons have been unfairly cheated, or deceived as to their
rights. This belief that the common man has been abused and cheated by a hidden hand seems to
form the basis for OPCA community members perceived right to break 'the system' and retaliate
against 'their oppressors'.
[70] These Reasons in many instances identify reported caselaw that comments on OPCA
litigants, OPCA gurus, and their misconduct. It should be understood that the reported caselaw is
the proverbial tip of the iceberg. The vast majority of encounters between this Court and OPCA
litigants are not reported. These litigants and their schemes have been encountered in almost all
areas of law. They appear in chambers, in criminal proceedings, initiate civil litigation based on
illusionary OPCA rights, attempt to evade court and state authority with procedural and defence
based schemes, and interfere with unrelated matters.
[71] OPCA strategies as brought before this Court have proven disruptive, inflict unnecessary
expenses on other parties, and are ultimately harmful to the persons who appear in court and
attempt to invoke these vexatious strategies. Because of the nonsense they argue, OPCA litigants
are invariably unsuccessful and their positions dismissed, typically without written reasons.
Nevertheless, their litigation abuse continues. The growing volume of this kind of vexatious
litigation is a reason why these Reasons suggest a strong response to curb this misconduct.
[72] Beyond that, these are little more than scams that abuse legal processes. As this Court
now recognizes that these schemes are intended for that purpose, a strict approach is appropriate
when the Court responds to persons who purposefully say they stand outside the rules and law,
or who intend to abuse, disrupt, and ultimately break the legal processes that govern conduct in
Canada. The persons who advance these schemes, and particularly those who market and sell
these concepts as commercial products, are parasites that must be stopped.
173 ] A critical first point is an appreciation that the concepts discussed in these Reasons are
frequently a commercial product, designed, promoted, and sold by a community of individuals,
whom I refer to as "gurus". Gurus claim that their techniques provide easy rewards one does
not have to pay tax, child and spousal support payments, or pay attention to traffic laws. There
are allegedly secret but accessible bank accounts that contain nearly unlimited funds, if you
know the trick to unlock their gates. You can transform a bill into a cheque with a stamp and
some coloured writing. You are only subject to criminal sanction if you agree to be subject to
criminal sanction. You can make yourself independent of any state obligation if you so desire,
and unilaterally force and enforce demands on other persons, institutions, and the state. All this is
a consequence of the fact gurus proclaim they know secret principles and law, hidden from the
public, but binding on the state, courts, and individuals.
And all these "secrets" can be yours, for small payment to the guru.
[II] These claims are, of course, pseudolegal nonsense. A judge who encounters and reviews
OPCA concepts will find their errors are obvious and manifest, once one strips away the layers
of peculiar language, irrelevant references, and deciphers the often bizarre documentation which
accompanies an OPCA scheme. When reduced to their conceptual core, most OPCA concepts
are contemptibly stupid. Mr. Meads, for example, has presented the Court with documents that
appear to be a contract between himself, and himself. One Mr. Meads promises to pay for any
liability of the other Mr. Meads. One owns all property, the other all debts. What is the
difference between these entities? One spells his name with upper case letters. The other adds
spurious and meaningless punctuation to his name. Mr. Meads (with punctuation) is the Mr.
Meads who appeared in court. He says the Mr. Meads (all capitals) is the one who should pay
child and spousal support.
[76] So where is that Mr. Meads (all capitals)? At one point in the June 8 hearing Mr. Meads
said that Mr. Meads (all capitals) was a "corporate entity" attached to his birth certificate. Later,
he told me that the other Mr. Meads was a "person" and that I had created him! Again, total
nonsense.
[77] The bluntly idiotic substance of Mr. Mead's argument explains the unnecessarily
complicated manner in which it was presented. OPCA arguments are never sold to their
customers as simple ideas, but instead are byzantine schemes which more closely resemble the
plot of a dark fantasy novel than anything else. Latin maxims and powerful sounding language
are often used. Documents are often ornamented with many strange marking and seals. Litigants
engage in pecuiiar, rituaiiike in couri conuuci. Aii ihese features appear necessary fur gurus iu
market OPCA schemes to their often desperate, illinformed, mentally disturbed, or legally
abusive customers. This is crucial to understand the nonsubstance of any OPCA concept or
strategy. The story and process of a OPCA scheme is not intended to impress or convince the
Courts, but rather to impress the guru's customer.
Mediaeval alchemy is a helpful analogue. Alchemists sold their services based on the
theatre of their activities, rather than demonstrated results, or any analytical or systematic
methodology. OPCA gurus are modern legal alchemists. They promise gold, but their methods
are principally intended to impress the gullible, or those who wish to use this drivel to abuse the
court system. Any lack of legal success by the OPCA litigant is, of course, portrayed as a
consequence of the customer's failure to properly understand and apply the guru's special
knowledge.
[79] Caselaw that relates to Gurus, reviewed below, explains how gurus present these ideas in
seminars, books, websites, and instructional DVDs and other recordings. They provide
preprepared documents, which sometimes are government forms, and instruct how to fill in the
necessary information that then produces the desired effects. Gurus write scripts to follow in
court. Some will attempt to act as your representative, and argue your case.
[||l] When gurus do appear in court their schemes uniformly fail, which is why most leave
court appearances to their customers. That explains why it is not unusual to find that an OPCA
litigant cannot even explain their own materials. They did not write them. They do not (fully)
understand them. OPCA litigants appear, engage in a court drama that is more akin to a magic
spell ritual than an actual legal proceeding, and wait to see if the court is entranced and
compliant. If not, the litigant returns home to scrutinize at what point the wrong incantation was
uttered, an incorrectly prepared artifact waved or submitted.
A. Characteristics of OPCA Group Members
[II] As is illustrated in the specific examples that follow, persons who adopt OPCA ideas
may come from practically any part of society. OPCA ideas appear to be developed in social
groups. For example, this Court has often observed 'supporters' attending OPCA litigation
hearings. OPCA litigants frequently say they work or study in groups. Mr. Meads mentioned he
studies the law with a number of other persons with similar interests. Internet forums are clearly
important mechanisms by which OPCA litigants and those interested in OPCA concepts discuss
and plan their activities. OPCA litigants and gurus often appear to prefer to communicate and
broadcast their ideas with video recordings made available on the "www.youtube.com" website.
[S|] This Court and the reported caselaw indicates that OPCA litigants and gurus do not have
a particular political orientation. Intriguingly, the same concepts and mechanisms are advanced
by both persons who hold perspectives that are alternatively extremely right wing (for example:
R. v. Warman, 2001 BCCA 510 (CanLfl); Warman v. Warman, 2005 CHRT 36 (CanLIl);
Warman v. Warman, 2005 CHRT 43 (CanLIl.)) or extremely left wing (for example: Jackson v.
Canada (Customs and Revenue Agency), 2001 SKQB 377 (CanLIl) at para. 21,210 Sask.R.
285). They use the same 'techniques' but each has a different backstory or context for that
methodology.
[83] Other OPCA litigants proclaim bizarre alternative histories which have no obvious or
explicit political affiliations, for example: Henry v. Starwood Hotels, 2010 ABCA 367 (CanLIl),
leave refused [2010] S.C.C.A. No. 475; Henry v. El, 2010 ABCA 312 (CanLIl), leave refused
[2011] S.C.C.A. No. 138. Some, like Mr. Meads, frame their beliefs in a religious context, for
example: Bloom v. Canada, 2011 ONSC 1308 (CanLIl); Sandri v. Canada (Attorney General),
2009 CanLIl 44282 (ON SC), 2009 CanLIl 44282, 179 A.C.W.S. (3d) 811 (Ont. Sup. Ct. J.);
Pappus v. Canada, 2006 TCC 692 (CanLIl), [2006] G.S.T.C. 161; J?, v. Lindsay, 2011 BCCA
99 (CanLIl), 302 B.C.A.C. 76, leave refused [2011] S.C.C.A. No. 265.
[84] The alternative history and conspiracy stories that cloak various different groups of
OPCA litigants may be very different, but the caselaw and this Court's experience increasingly
points to these apparently disparate groups making the exact same pseudolegal arguments. The
only ideology, such as it is, that unifies these litigants and their leaders is a belief that they
should be immune from obligations.
B. The OPCA Guru
J 85 J These Reasons will survey a number of known OPCA gurus, and their activities. In
summary, the guru class are nothing more than conmen. Gurus are the usual source of new
OPCA concepts, though more often their novel contribution is to simply create a variation on or
repackage a preexisting strategy, perhaps changing language or putting in some particular twist
to a concept. Gurus seem to borrow extensively from one another. For example, its appears that
parts of a document filed in one OPCA matter may be reproduced in another proceeding. An
excellent example of that is the 'fee schedule' attached to these Reasons. Identical language is
reproduced in materials discussed in Szoo v. Canada (Royal Canadian Mounted Police), 2011
BCSC 696 (CanLIl).
[1|] The caselaw indicates that gurus adopt a number of strategies. One is that they provide
materials, such as seminars, books, and DVDs, that explain the theoretical context of their ideas,
and demonstrate the application of those ideas for the benefit of their customers. These
commercial products may include items such as form documents, scripts, and other materials that
can be used in court, sent to government actors, or used in litigation. Some OPCA gurus hold
seminars to promote the materials they sell. Many have Internet web pages that serve the same
function.
L Russell Poriskv and the Paradigm Education Group
[87J Typically, this Court has learned about gurus and their activities from the perspective of
an outside observer. For example, in court, justices see litigants identify certain persons who
provide assistance or guidance to an OPCA litigant. Some gurus have appeared before justices
of this Court and have directed (or appear to direct) the OPCA litigant's conduct, or attempt to
represent the OPCA litigant.
[88] Recently, a more complete window into the operations of an OPCA guru and his
customer base has been provided by the trial and conviction (R. v. Porisky, 2012 BCSC 67
(CanLIl), 2012 D.T.C. 5037 [ 'Porisky Trial Decision"]) and sentencing (R. v. Porisky, 2012
BCSC 771 (CanLIl) ["Porisky Sentencing Decision"]) of Russell Porisky and Elaine Gould for
tax evasion and counseling others to commit fraud. R. v. Sydel, 2006 BCPC 346 (CanLIl) also
reports on the Porisky operation but from the perspective of one customer, a dentist. These cases
provide many details on how an OPCA scheme operates.
[891 Porisky operated a business, named "The Paradigm Education Group", that advanced a
concept that it was possible for a potential taxpayer to:
... structure their affairs so that they were a "natural person, working in his own
capacity, under a private contract, for his own benefit". Paradigm taught that
money earned under this arrangement was exempt from income tax.
(.Porisky Trial Decision, at para. 1)

[90] Porisky claimed this was in response to a banking conspiracy:
He founded what he eventually called The Paradigm Education Group to "create a

structure that everyone could work together in to save the country from a foreign
parasite". The foreign parasites were the international bankers who were, directly
or indirectly, responsible for the income tax system.
(Porisky Trial Decision, at para. 38)
191] Porisky taught that the Canada Revenue Agency had tricked persons into believing there
was an obligation to pay tax, and further that taxation is slavery, serfdom, and contrary to the
Canadian Bill of Rights: para. 111. Justice Myer helpfully isolates representative examples of the
alternative reality and rhetoric Porisky directed to his customers in the Appendix to the trial
decision. It is typical that a guru will frame his or her arguments in a conspiratorial context, and
claim that the potential customer has been cheated. The state is an enemy and oppressive. A few
sample passages illustrate Porisky's perspective on the world:
... When I was a good slave I dismissed my thoughts because I was taught that I
was incapable of understanding the superior wisdom of my elected officials. The
more I studied though, the freer my mind grew and the clearer it became. They
never had some kind of superior wisdom as I had been taught, in fact it became
painfully clear that many of them could not or would not even think for
themselves ...
As far as propaganda goes, the "National Post" article was a great textbook
example of promoting a victim mentality. It seems to stimulate sympathy for our
poor federal government, while painting everyone who doesn't submit to their
national plundering program as a criminal. Nevertheless, it was a great read, I
laughed, I cried and I'll definitely want to read it again when I feel like being
shamed into feeling that I should waive my natural rights so our government can
keep its trough full enough to ensure their fiscal mismanagement can continue
unabated.
This mental shift toward total government dependence is what will allow the
implementation of the banker's ultimate agenda, a New World Order run by a
One World Government that they control.
... The choice is yours, but consider this, ignorance may be bliss, but it costs you
plenty.
[921 I will not review the basis on why Porisky's "natural person" scheme is incorrect, as this
question is thoroughly dissected in reported cases including: R. v. Klundert, 2008 ONCA 767
(CanLIl) at para. 19, 93 O.R. (3d) 81, leave denied [2008] S.C.C.A. No. 522; R. v. Lindsay, 2011
BCCA 99 (CanLIl) at para. 27, 302 B.C.A.C. 76, leave refused [2011] S.C.C.A. No. 265; R. v.
Pinno, 2002 SKPC 118 (CanLIl) at paras. 1213, 1516, [2003] 3 C.T.C. 308; Kennedy v.
Canada (Customs and Revenue Agency), 2000 CanLIl 22837 (ON SC), [2000] 4 C.T.C. 186,
2000 D.T.C. 6524 (Ont. Sup. Ct. J.); and Porisky Trial Decision at paras. 5861.
|J|] Porisky and Paradigm advanced this scheme on a commercial basis. Porisky operated a
website, and sold instructional materials such as books and DVDs: Porisky Trial Decision, at
para. 39. Porisky also conducted seminars where he changed a fee (at para. 39), and provided
levels of training and exams (at paras. 101105). Paradigm operated as something of a pyramid
scheme; Porisky also qualified "educators" to further proselytize his approach: Porisky Trial
Decision, at paras. 39, 106. At least one of these educators is now also the subject of criminal
litigation: R. v. Lawson, 2012 BCSC 356 (CanLIl), at para. 21, as are other participants in the
Porisky tax evasion ring: R. v. McCartie, 2012 BCSC 928 (CanLIl). Many other persons who
used Porisky's techniques have already been convicted of tax evasion: Porisky Trial Decision, at
para. 63.
[94] Additionally, and in what can only be described as an exercise in pure arrogance,
Porisky demanded 7% of the next two years income from his subscribers in exchange for his or
his educator's assistance: Porisky Trial Decision, at para. 40. The tax liberator had become a tax
collector.
1951 The pseudolegal basis for Porisky's claims is very representative of how OPCA
arguments are rationalized and explained by their proponents. Statutes, caselaw (often foreign or
obsolete), legal platitudes and definitions (again often foreign or obsolete), political ideology,
and conspiracy, were strung together into a loose cloud that pointed to a desired result. Justice
Myers eloquently described this process at para. 67 of the trial decision:
lvlr. Furisky s analysis piuks aiiu uliuuscs MiippciS fiGiii VdiiOuS SiatuiCS diiu CaSCS,
and attempts to create logical links where none exist. It is, in effect, legal
numerology.
[If] It is important at this point to again stress the audience for Porisky's ideas. That was not
the courts, government actors, but his clientele. What mattered was that his customer base
believe and then pay for his services.
[97] Porisky was convicted and sentenced for having personally evaded taxes, and having
aided and abetted the evasion of income tax. Justice Myers rejected a disclaimer by Porisky that
his ideas, materials, and advice were for "educational purposes only": Porisky Trial Decision, at
para. 98. Porisky had gone so far as to prepare (unsuccessful) legal arguments for one of his
clients who had been sued for tax evasion. Porisky then analyzed that result, and told his
subscribers why the client's conviction was "ambiguous" and "... just another desperately needed
bowl of propaganda pabulum for public consumption, to keep the masses asleep and enslaved ..."
[sic]: paras. 118121.
[98] In total, Porisky's guru activities led to substantial tax evasion, which was difficult to
quantify with precision: Porisky Sentencing Decision, at paras. 3840. He had approximately
800 "students" who applied his scheme: at para. 40. A 4.5 year prison sentence was ordered:
para. 57.
[...]
B. Obligation Requires Agreement
[379] A second common OPCA litigation category is grounded in a belief that all legally
enforceable rights require that a person agree to be subject to those obligations. This strategy
takes two closely related forms:
1. every binding legal obligation emerges from a contract, and
2. consent is required before an obligation can be enforced.
[380] Persons who advance this concept extend it to interactions between state actors,
including Canada and the provinces, and individual persons. This is a kind of 'magic hat'; the
OPCA litigant says he or she has not agreed to be governed or subject to court authority, and the
OPCA litigant is therefore allegedly immune.
[381] Sometimes OPCA litigants and gurus express this global concept as that they only
engage in commerce; this seems to be an attempt to declare that any interaction between persons
and/or state actors is a contract. This may explain the curious but common manner in which I
find myself addressed in OPCA correspondence, "John Rooke, carrying out business as
Associate Chief Justice John Rooke".
1. Defeating Legislation
[382] A necessary first step in any 'everything is a contract' or 'consent is required' scheme
is that the OPCA litigant develop a mechanism that denies a unilateral obligation can arise from
legislation.
[383] Some OPCA litigants argue they have opted out of legislated obligations: Sydorenko v.
Manitoba, 2012 MBQB 42 (CanLIl) at paras. 1718. Others simply claim consent is required,
otherwise legislation is a set of optional guidelines: Waterloo (Regional Municipality) v.
Bydeley, 2010 ONCJ 740 (CanLIl) at para. 56, affirmed 2011 ONCJ 842, affirmed [2011] O.J.
No. 6282 (QL) (Ont. C.A.); Bank of Montreal v. McCance, 2012 ABQB 537 (CanLIl) at para.
29.
[384] Another OPCA approach is to argue that a court or government actor is a corporation
and therefore only has the rights of a corporation: Dempsey v. Envision Credit Union, 2006
BCSC 1324 (CanLIl) at para. 37, 60 B.C.L.R. (4th) 309. The result is a claim that legislation has
no more special meaning than any unilateral declaration. A telltale indication of this scheme is
that a litigant files corporate registry documents for Canada, a province, or a municipality. For
some reason, many OPCA litigants claim Canada is a "municipal corporation domiciled in the
District of Columbia".
[385] Others wear a 'magic hat' that they say makes them immune from legislation, and only
subject to the common law (which, as noted above, is often an aberrant definition of that
category of law). In Dempsey v. Envision Credit Union, 2006 BCSC 1324 (CanLIl) at para. 39,
60 B.C.L.R. (4th) 309 the 'magic hat' was being a "free will full liability person" under "Anglo
Saxon Common Law". FreemenontheLand take a similar approach: Harper v. Atchison, 2011
SKQB 38 (CanLIl) at paras. 6, 15, 369 Sask.R. 134, see also Szoo v. Canada (Royal Canadian
Mounted Police), 2011 BCSC 696 (CanLIl), and Jabez Financial Services Inc. (Receiver of) v.
Sponagle, 2008 NSSC 112 (CanLIl) at paras. 14, 18, 264 N.S.R. (2d) 224; Summerland
(District) v. No Strings Enterprises Ltd., 2003 BCSC 990 (CanLIl) at para. 19,124 A.C.W.S.
(3d) 39, leave denied 2004 BCCA 360 (CanLIl), 131 A.C.W.S. (3d) 994.
[386] Similarly, Detaxer gurus such as Warman and Lindsay have argued the that Magna
Carta operates in a constitutional manner and invalidates legislation: R. v. Lindsay, 2008 BCCA
30 (CanLIl) at paras. 1921, 250 B.C.A.C. 270; see also R. v. Warman, 2001 BCCA 510
(CanLIl) at paras. 910,1314.
[387] Of course, any other 'magic hat' or alleged defect that negates state authority would
have the same effect. That is a reason why OPCA litigants have often focussed on some arcane
flaw that collapses state authority, for example the alleged defect in Queen Elizabeth II's
coronation oath (R. v. Lindsay, 2011 BCCA 99 (CanLIl) at paras. 3132, 302 B.C.A.C. 76, leave
refused [2011] S.C.C.A. No. 265), or a flaw in the appointment of Governor Generals after
passage of the 1931 Statute of Westminster (R. v. Dick, 2001 BCPC 275 (CanLIl); R. v.
Lindsay, 2004 MBCA 147 (CanLIl) at para. 32, 187 Man.R. (2d) 236).
2. Everything is a Contract
[388] An OPCA litigant may argue he or she has no obligation unless the litigant has
explicitly formed a contract for that obligation. In Canada this argument has frequently been
advanced in an income tax context: R. v. Lindsay, 2011 BCCA 99 (CanLIl) at para. 31, 302
B.C.A.C. 76, leave refused [2011] S.C.C.A. No. 265; R. v. Pinno, 2002 SKPC 118 (CanLIl) at
paras. 1213, 21, [2003] 3 C.T.C. 308; Banilevic v. Canada (Customs and Revenue Agency),
2002 SKQB 371 (CanLIl) at para. 10, 117 A.C.W.S. (3d) 549; Bruno v. Canada, 2000 BCSC
190 (CanLIl) at para. 34, [2000] 2 C.T.C. 16, affirmed 2002 BCCA 47 (CanLIl), 162 B.C.A.C.
293; Turnnir v. The Queen, 2011 TCC 495 (CanLIl) at paras. 5, 8; Sandri v. Canada (Attorney
General), 2009 CanLIl 44282 (ON SC), 2009 CanLIl 44282 at paras. 6,13, 179 A.C.W.S. (3d)
811 (Ont. Sup. Ct. J.); Dempsey v. Envision Credit Union, 2006 BCSC 1324 (CanLIl) at para.
37, 60 B.C.L.R. (4th) 309.
[389] An interesting variation on this approach was made by Porisky, who at trial argued that
if he did not want any government services, then he ought not be obliged to pay income tax:
Porisky Trial Decision at para. 66. Though not expressed in quite that manner, Porisky seems to
argue that he should not be bound in the 'income tax contract' as he has not received any
consideration from the government.
[390] In yet another variation of the 'everything is a contract' concept, a person attempt to
sever all 'contractual relationships' with the state; success would presumably defeat all
government authority. R. v. Pinno, 2002 SKPC 118 (CanLIl) at paras. 22, [2003] 3 C.T.C. 308
provides an example where an OPCA litigant sent the Canada Revenue Agency a "constructive
notice" that included this statement:
... I further learned that I have been deceptively induced by Revenue Canada's
propaganda into making a supposed contract by filing an income tax return, thus
changing my status to "taxpayer" which makes me subject to the income tax by that
supposed contract....
The litigant then 'revoked and voided' the income tax contract, and demanded a refund: para.
13.
[391] R. v. Sargent, 2004 ONCJ 356 (CanLIl) at paras. 4041, [2005] 1 C.T.C. 448 and
Dempsey v. Envision Credit Union, 2006 BCSC 1324 (CanLIl) at para. 37, 60 B.C.L.R. (4th)
309 report a similar strategy. A similar scheme appears to have been advanced by a Freemanon
theLand in R. v. McCormick, 2012 NSSC 288 (CanLIl) to withdraw from a "social contract"
with the state: paras. 2832.
[392] An OPCA litigant may also attempt to use the right of contract as a shield. For
example, in Dempsey v. Envision Credit Union, 2006 BCSC 1324 (CanLIl) at para. 9, 60
B.C.L.R. (4th) 309 an OPCA litigant challenged the court's authority to refuse representation by
an OPCA guru because:
The court has no jurisdiction to interfere or make void any private agreement I may have
with other men for such is my inalienable right as a free man.
[393] The OPCA litigant in Sandri v. Canada (Attorney General), 2009 CanLIl 44282 (ON
SC), 2009 CanLIl 44282 at para. 10, 179 A.C.W.S. (3d) 811 (Ont. Sup. Ct. J.) took his defence
one step further:
I (the Plaintiff) state and the fact is that according to Contract Law there is no Queen who
has any authority over me; however, I have complete authority over the aforesaid
monarch by Contract Law. I am lord. The aforesaid monarch has authority only over
those who give her authority and in turn, all those who have done so, by default give me
authority. I am ONLY a beneficiary to the contracts that compose the Constitution Acts,
1867 to 1982. It is a TRUST and the "queen" therein stated is my lieutenant, or in other
words, my helper. By law, she is compelled to obey me.
[394] Sometimes OPCA litigants claim that their interaction with the court is a contract. For
example, the OPCA litigant in Borkovic v. Laurentian Bank of Canada, 2001 BCSC 337
(CanLIl) at paras. 412, 103 A.C.W.S. (3d) 700 argued he had 'purchased' a trial date by paying
a court filing fee. The litigant then purported to direct court procedure: paras. 1316.
[395] OPCA litigants who adopt this scheme tend to identify practically any state document,
even a driver's license or a birth certificate, as a contract. CERI members explain that is the
reason why they do not use driver's licenses or license plates. They argue, in effect, that they do
not wish to be in a contract with the state, and should be able to engage in activities, for example
operation of a motor vehicle, without being bound to the state in that manner.
[396] These persons go to great lengths to scour away all 'contractual' links, expecting that at
some point the state's authority will evaporate. The 'everything is a contract' concept may also
emerge in a court context in another way. A OPCA litigant may, for example, demand to know
whether the court is offering to enter into a contract with a litigant, or the terms of the contract
between the court and the OPCA litigant.
[...]
3. Consent is Required
[405] A second common variant of the 'obligation requires agreement' category is a belief
that a person is immune if they simply say they have not consented to be subject to the law and
the courts. Of course, this concept has not met with success: R. v. Jennings, 2007 ABCA 45
(CanLIl) at para. 6; Hajdu v. Ontario (Director, Family Reponsibility Office), 2012 ONSC 1835
(CanLIl) at paras. 25, 29; see also Jabez Financial Services Inc. (Receiver of) v. Sponagle, 2008
NSSC 112 (CanLIl) at paras. 14, 18, 264 N.S.R. (2d) 224; Szoo v. Canada (Royal Canadian
Mounted Police), 2011 BCSC 696 (CanLIl) at paras. 17, 45.
[406] Sometimes this motif emerges in documentary form. For example, this Court has
received issued court orders stamped and returned with various messages, such as:
*** ALL CONSENT DENIED ***
RETURNED FOR CAUSE
OFFER REJECTED FOR
1. THIRD PARTY INTERFERENCE

2. BREACH OF CONTRACT
3. BREACH OF TRUST
4. BREACH OF CRIMINAL CODES OF CANADA
5. COMMERCIAL IMPROPRIETY
6. EXTRA JURISDICTIONAL
7. DEEMED UNLAWFULLY VEXATIOUS
8. DEEMED WITH MALICE AFORETHOUGHT
Of course, that had no effect.
[407] Various 'magic hats' may allegedly provide a basis for that declaration of immunity.
Courts have encountered claims that FreemanontheLand status (Harper v. Atchison, 2011
SKQB 38 (CanLIl) at paras. 6, 15, 369 Sask.R. 134; Szoo v. Canada (Royal Canadian Mounted
Police), 2011 BCSC 696 (CanLIl)), or the Magna Carta (Harper v. Atchison, 2011 SKQB 38 at
paras. 915, 369 Sask.R. 134; R. v. Jebbett, 2003 BCCA 69 (CanLIl), 180 B.C.A.C. 21;
Winningham v. Canada) nullifies government or court authority.
[408] In R. v. McCormick, 2012 NSSC 150 (CanLIl) at para. 9 an OPCA litigant argued the
FreemanontheLand 'magic hat' immunized against criminal sanction; see also R. v.
McCormick, 2012 NSSC 288 (CanLIl) at paras. 2832. Naturally, that did not work. As Justice
Moir observed in R. v. McCormick, 2012 NSSC 288 at para. 32: "[t]his teaching is not only
wrong in the sense that it is false. It is wrongful. That is, it is full of wrong."
[409] A foisted unilateral contract can be an alleged basis for nonconsent. One this Court
has received concluded:
NULL APPEARANCE. As a private nonbelligerent without the Canada or United

States, I do not consent to a general appearance now and/or in perpetuity, and none can
be assumed without a conversion of personal liability. No grant of in rem or in personam
jurisdiction is expressed or implied. No chose in action is expressed or implied on behalf
of the Defendant/Debtor or any legal fiction, juristic personality or ens legis artificial
person. I do not intend, nor will I, argue the merits, facts or law, represent the
Defendant/Debtor, request any action that would imply a cause is properly pending, or
engage in any controversy. [Emphasis in original.]
The cryptic "without the Canada or United States" language relates to an alleged earlier deeming
provision that set the litigant outside those countries, even when he was physically inside those
countries. See also R. v. Boisjoli, 2012 ABQB 556 (CanLIl) at paras. 4448.
[410] As with the 'all relationships are contracts' variant, OPCA litigants seem to see
'consent' emerging from very mundane activities. They may, for example, refuse to advance past
the bar in a courtroom because that would 'consent' to court authority: Canada v. Galbraith,
2001 BCSC 675 (CanLIl) at paras. 2529, 54 W.C.B. (2d) 504; MercedesBenz Financial v.
Kovacevic, [2009] O.J. No. 783 at para. 8, 2009 CanLIl 9368 (ON SC), 2009 CanLIl 9368 (Ont.
Sup. Ct. J.). The same reasoning leads this category of OPCA litigant to refuse to plead guilty or
notguilty, or to disobey an instruction to sit or stand.
4. Conclusion Obligation Requires Agreement
[411] A claim that the relationship between an individual and the state is always one of
contract is clearly incorrect. Aspects of that relationship may flow from mutual contract (for
example a person or corporation may be hired by the government to perform a task such as road
maintenance), but the state has the right to engage in unilateral action, subject to the Charter, and
the allocation and delegation of government authority.
[412] Similarly, my authority over this dispute is not subject to the agreement or consent of
either party. It flows from the inherent authority of this court, as shaped by legislation.
[413] Either branch of the 'obligation requires agreement' OPCA strategy category seeks
unsuccessfully to deny court authority, and operationally is an attempt by an OPCA litigant to
restrict the scope of state and court jurisdiction.
5. Court Misconduct by 'Everything is a Contract' and 'Consent is Required'
Litigants
[414] OPCA litigants who use 'consent' and 'contract' approaches are often difficult
courtroom participants. These persons may be highly disruptive as they attempt to avoid any step
or action that they apparently fear might create a contract, or acknowledge consent. They may
refuse to comply with practically any request by a judge or court official on that basis. That is a
possible explanation for Mr. Meads' premature exit. If he had waited until I completed the
hearing, he arguably would have 'consented' to my authority. This kind of belief is not atypical
of the distorted perspective of 'obligation requires agreement' OPCA litigants.
[415] 'Nonconsent' may be indicated by a mantralike nonreply to all court comments, for
example the curious Moorish Law phrase "I accept that for value and consideration and honour"
(see Henry v. El, 2010 ABCA 312 (CanLIl) at para. 3, leave refused [2011] S.C.C.A. No. 138),
see also: MercedesBenz Financial v. Kovacevic, [2009] O.J. No. 783 at para. 51, 2009 CanLIl
9368 (ON SC), 2009 CanLIl 9368 (Ont. Sup. Ct. J.)). Mr. Meads' did not engage in a 'mantra
response', but still showed a clear apprehension that our exchange in the June 8 hearing could
result in what he appeared to believe would be a contract.
[416] There is no obvious or simple way to address persons who believe obligation may
emerge from the most trivial of conduct, other than to perhaps emphasize the inherent
jurisdiction of the courts means that the OPCA litigant is subject to court authority, no matter
what the litigant may think or say. Admittedly, that explanation will not likely be welcomed, and
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C. Double/Split Persons
[417] A strange but common OPCA concept is that an individual can somehow exist in two
separate but related states. This confusing concept is expressed in many different ways. The
'physical person' is one aspect of the duality, the other is a noncorporeal aspect that has many
names, such as a "strawman", a "corporation", a "corporate entity", a "corporate fiction", a
"dead corporation", a "dead person", an "estate", a "legal person", a "legal fiction", an "artificial
entity", a "procedural phantom", "abandoned paper work", a "slave name" or "slave person", or
a "juristic person".
[418] Many OPCA nomenclature schemes relate to this duality. For example, the 'lower
case' vs. 'upper case' name pairs indicates the 'physical person' and 'noncorporeal aspect',
respectively. When "::DennisLarry: Meads::" says he acts "on behalf of DENNIS LARRY
MEADS (juristic person)", he appears to indicate he believes he has two separate aspects, and
that the man in the courtroom ("::DennisLarry: Meads::") is representing his other half
("DENNIS LARRY MEADS (juristic person)"). Other times OPCA litigants say they are
"agents", "trustees", "owners", "representatives" or "secured party" for their other aspect: Hajdu
v. Ontario (Director, Family Reponsibility Office), 2012 ONSC 1835 (CanLIl); Canada v.
Galbraith, 2001 BCSC 675 (CanLIl) at paras. 2628, 54 W.C.B. (2d) 504; Turnnir v. The Queen,
2011 TCC 495 (CanLIl) at paras. 56; Dempsey v. Envision Credit Union, 2006 BCSC 1324
(CanLIl) at para. 37, 60 B.C.L.R. (4th) 309; Canada (Minister of National Revenue M.N.R.) v.
Stanchfield, 2009 FC 99 (CanLIl) at para. 27, 340 F.T.R. 150; Bank of Montreal v. McCance,
2012 ABQB 537 (CanLIl) at para. 9; Services de financement TD inc. c. Michaud, 2011 QCCQ
14868 (CanLIl) at para. 6; this proceeding.
[419] A particularly surreal variation on this theme is reported in Dempsey v. Envision
Credit Union, 2006 BCSC 750 (CanLIl) at para. 92, 151 A.C.W.S. (3d) 204, where the 'physical
litigants' purported to intervene in the action against their 'noncorporeal aspects'. Justice
Garson classified that attempt as "unintelligible" and struck the associated counterclaim: para.
93.
[420] The 'dash colon' and 'family/clan/house of motifs uniformly indicate the 'physical
person' half of these double/split individuals. Other times the 'physical person' is called a
"natural person" or is described as being "flesh and blood": Porisky Trial Decision; R. v.
Lindsay, 2011 BCCA 99 (CanLIl), 302 B.C.A.C. 76, leave refused [2011] S.C.C.A. No. 265;
MercedesBenz Financial v. Kovacevic, [2009] O.J. No. 783, 2009 CanLIl 9368 (ON SC), 2009
CanLIl 9368 (Ont. Sup. Ct. J.); MercedesBenz Financial v. Kovacevic, [2009] O.J. No. 783 at
para. 24, 2009 CanLIl 9368 (Ont. Sup. Ct. J.)). Mr. Meads adopts the latter kind of language, he
(the physical litigant) is "the living flesh and blood sentientman".
[421] There are different explanations for the noncorporeal similarity. Some OPCA gurus
promote the idea that this aspect is created by the state, burdened with legal obligations, then
'shackled' to the physical person. Other OPCA gurus present the noncorporeal aspect as a part
of a person that can be split away, and then burdened with obligations and debts.
[422] Of course, either approach is legally ineffectual. Canadian law does not provide for a
person to have two aspects this entire concept is yet another 'magic hat'. This fundamental
misapprehension was eloquently explained by Justice Gauthier in Canada (Minister of National
Revenue M.N.R.) v. Stanchfield, 2009 FC 99 (CanLIl) at paras. 17, 27, 340 F.T.R. 150:
... Mr. Camplin in the abovementioned case seems to have argued, in the same fashion as
the respondent, that he had two capacities, one which he characterised as being his
"private capacity as a "natural person" for my own benefit" and the other as his capacity
as "legal representative of the taxpayer". Here, the respondent characterises his purported
capacities as being (1) as a natural person, and (2) as a taxpayer. The deletion of the
words "legal representative" from the latter purported capacity does not render this case
distinguishable from the one at bar. The whole notion of their being a second capacity
distinct from the one of a natural person or human being is a pure fiction, one which is
not sanctioned by law. One can describe nothing in any terms one wishes; it still remains
nothing.
Cory Stanchfield's attempt to argue before this Court that his body comprises two
persons which act in different capacities is of one of two things: (1) an inadmissible
division of his indivisible entity, or (2) an attempted creation of a second entity in a
fashion which is not recognized by law, the result of which amounts to nothing in the
eyes of the law. It is an attempt at the impossible and the respondent cannot do the
impossible. Therefore, "Cory Stanchfield (the Respondent)" and "Cory Stanchfield, in his
capacity as a natural person (the Witness)" is but one person, with one single capacity ...
[Emphasis added.]
See also Canada (Minister of National Revenue M.N.R.) v. Camplin; M.N.R. v. Camplin, 2007
FC 183 (CanLIl) at paras. 89, [2007] 2 C.T.C. 205; R. v. Lindsay, 2006 BCCA 150 (CanLIl) at
para. 3, 265 D.L.R. (4th) 193; MercedesBenz Financial v. Kovacevic, 2009 CanLIl 9368 (ON
SC), [2009] O.J. No. 783 at paras. 40,4445,2009 CanLIl 9368 (Ont. Sup. Ct. J.); Turnnir v.
The Queen, 2011 TCC 495 (CanLIl) at paras. 6, 8; Hajdu v. Ontario (Director, Family
Reponsibility Office), 2012 ONSC 1835 (CanLIl) at paras. 2429; Ontario (Director, Family
Responsibility Office) v. Boyle, [2006] O.J. No. 2181 (QL) at paras. 35, 149 A.C.W.S. (3d) 127
(Ont. Sup. Ct. J.).
[...]
Docket: 20063135(IT)I
BETWEEN:
TRUEMAN TUCK,
Appellant,
and

Respondent.
Motion heard on March 26,2007 at Kingston, Ontario
Before: The Honourable Justice G.A. Sheridan
Appearances:
For the Appellant: The Appellant himself
Counsel for the Respondent: Pascal Tetrault
ORDER
Upon a motion by the Respondent for an order striking out the Notice of
Appeal and dismissing the Appellant's appeal;
And upon having heard the submissions of and read the materials filed by the
parties,
IT IS HEREBY ORDERED THAT:
1. The Notice of Appeal of the Appellant is struck out and the appeals from the
assessments made under the Income Tax Act for the 2002 and 2003 taxation years
are dismissed, with costs payable to the Respondent in the amount of $100.00, in
accordance with the attached Reasons for Order.
Signed at Ottawa, Canada, this 23rd day of July, 2007.
"G.A. Sheridan"
Sheridan J.
Docket: 20063136(IT)I
BETWEEN:
YVONNE B. TUCK,
Appellant,
and

Respondent.
Motion heard on March 26, 2007 at Kingston, Ontario
Before: The Honourable Justice G.A. Sheridan
Appearances:
Agent for the Appellant: Trueman Tuck
Counsel for the Respondent: Pascal Tetrault
ORDER
Upon a motion by the Respondent for an order striking out the Notice of
Appeal and dismissing the Appellant's appeal;
And upon having heard the submissions of and read the materials filed by the
parties,
IT IS HEREBY ORDERED THAT:
1. The Notice of Appeal of the Appellant is struck out and the appeal from the
assessment made under the Income Tax Act for the 2004 taxation year is
dismissed, with costs payable to the Respondent in the amount of $100.00, in
accordance with the attached Reasons for Order.
"G.A. Sheridan"
Sheridan J.
Date: 20070723
Dockets: 20063135(IT)I
20063136(IT)I
BETWEEN:
TRUEMAN TUCK
YVONNE B. TUCK,
Appellants,
and

Respondent.
REASONS FOR ORDER
Sheridan, J.
[1 ] The Respondent brings a motion for an Order:
1. striking out the Notice of Appeal in its entirety and dismissing the appeal
accordingly; or
2. in the alternative, granting an extension of time for filing a Reply to the Notice
of Appeal pursuant to subsection 18.16(1) of the Tax Court of Canada Rules
(Informal Procedure)(sic), to 30 days from the date of the Order of this
Honourable Court disposing of the present motion; and
3. such further and other relief as this Honourable Court deems just.
[2] The grounds for the Respondent's motion are:
4. that the Notice of Appeal discloses no reasonable ground for appeal;
5. that the Notice of Appeal is scandalous, frivolous and vexatious;
6. that the Notice of Appeal is an abuse of process of this Court, and;
7. such further and other grounds as counsel may submit.

Page: 2
[3] The Respondent brings a similar motion in respect of the Notice of Appeal of
Yvonne Tuck, wife of the Appellant. The motions were heard together. Ms. Tuck
was not present at the hearing but the Appellant advised the Court that he was
authorized to represent her at the hearing of the motion.
[4] The Appellant served on the Respondent and filed with the Court a "Notice of
Constitutional Question" in respect of the Respondent's motion to dismiss his Notice
of Appeal. In that document, the Appellant describes himself as "Trueman of the
Tuck family, aka Trueman, Trueman Tuck, Gerrard Trueman Tuck" and goes on to
say in paragraph (a) that he is:
... a faithbased human being that was born ... as a freeman citizen of the British
Commonwealth and believes that GOD created human beings in GOD's image, as
sons and daughters of GOD. [Emphasis appears in original.]
[5] The Appellant also filed another document entitled "Notice of Special
Appearance in Propria Persona" in which he is similarly described.
[6] In the "Notice of Constitutional Question" filed in respect of Yvonne Tuck,

Ms. Tuck is described in the style of cause as "YVONNE BARBARA TUCK, aka
YVONNE B. TUCK, YVONNE TUCK, a federally created CAPITAL
CORPORATE PERSON apparently created in the 1960's by the federal Canadian
government, and Yvonne Barbara Tuck, aka Yvonne Tuck, Yvonne B. Tuck a
human being" [Emphasis appears in original.].
[7] According to the Appellant's submissions, the basis for the challenges
contained in these documents and in ihe Notices uf Appeal is thai llic Appellants
never "contractually consented voluntarily to the current taxation schemes attempting
to be enforced by the [Respondent] against the Appellant".1 Accordingly, in the case
of Trueman Tuck, the Appellant did not file income tax returns and his tax liability
was assessed under subsection 152(7) of the Income Tax Act. Although Ms. Tuck
filed a return, she joins her husband in disputing the constitutionality of the
Minister's assessment powers. The Appellant challenges the assessments on the
further grounds that in the Notices of Assessment under the heading "account
number" are noted numbers which are their social insurance numbers. The Appellant
says they never "asked for" social insurance numbers and accordingly, their
"accounts", and therefore the assessments, are not valid. Finally, he argues that the
assessments are without legal effect because in them, his name and that of his wife
1 Notice of Constitutional Question, page 2, paragraph (e).
Page: 3
have been typed in capital letters. When challenged on the essential silliness of this
point, the Appellant had the good grace to retreat from, if not completely abandon,
that line of argument.
[8] The Notice of Appeal of the Appellant was filed on August 7, 2006. It is a
long, rambling document which, in addition to the points set out above, includes a
series of questions which the Appellant insists must be answered by the Minister or
by this Court as a condition precedent to his paying any tax. A portion of the Notice
of Appeal is also devoted to the alleged misdeeds of certain Canada Revenue Agency
officials. The Notice of Appeal of Yvonne Tuck, filed September 19, 2006, is
essentially the same as the Appellant's, though shorter and modified slightly to
reflect her specific circumstances.
[9] The Respondent takes the position that the Notices of Appeal ought to be
struck out and the appeals dismissed.
[10] In considering whether to strike a pleading, the facts alleged must be taken as
true. Further, the Court must be satisfied that it is "plain and obvious" that the
impugned claim is without merit.2 Finally, the pleadings must be considered as
drafted, without evidence to rehabilitate any shortcomings. As counsel for the
Respondent quite correctly submitted, the case law is well settled that it is within
Parliament's power to impose taxes on its citizens.3 Accordingly, those portions of
the Notice of Appeal which dispute the Minister's authority to assess tax liability are
without merit. The same applies to the allegations in respect of the behaviour of the
Minister's officials: the jurisdiction of this Court is limited to determining the
correctness of the amount assessed; it does not extend to a consideration of the
conduct of the officials in making that assessment.4 With the exception of the
paragraphs considered below, the deletion of the above paragraphs from the Notices
of Appeal leaves little more than what I would describe as the Appellant's personal
opinions on the unpalatability of paying taxes. These have no place in properly
drafted pleadings.
2 Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959.

3Frank J. Bruno v. Canada (Customs and Revenue Agency), [2000] 4 C.T.C. 57 (B.C.C.A.);
Reinhard G. Mueller v. Her Majesty the Queen, [1993] 1 C.T.C. 143.
4 Main Rehabilitation Co. Ltd. v. Her Majesty the Queen, [2005] 1 C.T.C. 212 (F.C.A.).
Page: 4
[11] Turning now to each Notice of Appeal, in the case of Ms. Tuck, although she
filed an income tax return for 2004, nowhere in the Notice of Appeal does she
specifically address the Minister's reassessment of that return. The closest she comes
is in paragraph 6 of the section entitled "Closing Remarks":
6. Should one or both of the Plaintiffs be deemed liable then the Plaintiffs will
request that this Honourable Court clarify the various legal questions contained
herein and provide a reasonable time for the Plaintiff or Plaintiffs to both file the
appropriate Court order documents with the assistance of a Chartered
Accountant.
[12] Her reference in the above paragraph to "the appropriate Court order
documents" seems to suggest that Ms. Tuck is asking to be allowed to file a proper
Notice of Appeal should the present one be rejected. This is not an appropriate
pleading. If Ms. Tuck was aware in September 2006 that her Notice of Appeal was
likely defective, then was the time to draft it properly. In any case, it is not the task of
the Court to go about redrafting defective pleadings,5 especially where a party has
clearly elected to follow a particular litigation strategy:
21 It is not the duty of a judge to redraft pleadings. It is his or her duty,

however, to closely examine a proceeding before determining that it cannot be saved
through proper amendments. To use the words of my brother Stone in Krause..., the
judge seized with a motion [to strike pleadings6] must decide whether the document
is "so defective that it cannot be cured by simple amendment". This determination
requires a balancing act which cannot be subject to any definite norms. Each
proceeding is to be assessed on its own merits, with consideration being given to,
inter alia, the personal situation of the party, the issues and arguments raised, the
manner and tone in which they are raised, the number and proportion of allegations
that are defective and the readiness of the amendments needed. Where the Court is
dealing with a selfrepresented litigant, it should resist being too easily put off by the
mere phrasing of allegations and arguments that do not fall within established legal
parameters.7 [Footnote added.]
5HMTQ v. Galbraith, [2001] B.C.J. No. 2900, 2001 BCSC 675; R. v. Dick, [2003] B.C.J.
No. 187, 2003 BCPC 13 (B.C. Prov. Ct.); R. v. Carew, [1992] B.C.J. No. 995 (BCSC);
R. v. Sullivan, [1991] 1 S.C.R. 489; PPG Industries Canada Ltd. v. Canada, [1983] B.C.J.
No. 2260 (BCSC); Kennedy v. Canada Customs & Revenue Agency, [2000] O.J. No. 3313
(Ontario Supreme Court of Justice); R. v. Lindsay, [2006] B.C.J. No. 636, 2006 BCCA 150.
6 On the grounds that the pleadings were "scandalous, frivolous and vexatious".
7 Sweet v. Canada, [1999] F.C.J. No. 1539 (F.C.A.).
Page: 5
[13] By the same token, the Appellant (who undoubtedly drafted Ms. Tuck's
Notice of Appeal), devotes only one paragraph of his lengthy Notice of Appeal to the
details of the assessment of his 2002 and 2003 taxation years:
The Plaintiff will also rely in the alternative, should the assessment be deemed valid
that the Plaintiff be allowed to immediately file the drafted income tax returns for
the 2002 and 2003 taxation years and that the determined liability be reviewed by
this Honourable Court based upon further evidence once the various critical points
of law are determined as outlined herein. These adjustments would include the
Plaintiff s gross income, the dividend tax credits, personal exemptions, business
losses, and other normal deductions which are currently missing from the
Defendants' deemed assessments for the 2002 and 2003 taxation years and need to
be credited in accordance with the normal practices.8
[14] But even so, this paragraph is directed, not at a determination of the
correctness of that assessment but rather, at his being allowed to do what he ought to
have done in the first place, to file his 2002 and 2003 income tax returns, documents
which, in paragraph 33 of his Notice of Appeal under the heading "Issues", he alleges
he had already prepared "years ago ... with professional assistance".
Notwithstanding that fact, instead of filing his returns or getting on with a properly
formulated appeal of the arbitrary assessment, the Appellant elected to spend his time
drafting the voluminous documents and materials filed in these matters, none of
which focuses on the one area within this Court's jurisdiction; namely, the
correctness of the Minister's assessment.
8 See
the ninth unnumbered paragraph of the section of the Notice of Appeal entitled "Closing
Remarks".
Page: 6
[15] Because the Appellant represented himself at the hearing of these motions, I
permitted him more time than was perhaps merited to develop his position. Among
the many points of information provided to the Court was the fact that he considered
himself a sort of "unlicensed" lawyer and that as such, he had appeared frequently in
Court and learned a lot about litigation from these experiences. He went on to inform
the Court that he was not basing his case on the socalled "natural person" theory for
avoiding paying his taxes. Despite such assurances, however, many of the paragraphs
in the Notices of Appeal bear a certain similarity to the boiler plate clauses promoted
and used by the antitax groups in furtherance of their objectives.9
[16] The Appellant insisted in his presentation that he was quite willing to file
returns and pay taxes if only he were given a legal basis for doing so. The more the
Appellant expanded on his views, however, the less convinced I was of his bona
fides. Having patiently listened to what effectively became a rant against the
Government of Canada, the Prime Minister, the Minister of National Revenue,
Canada Revenue Agency officials, politicians, judges and the general unpleasantness
of having to pay taxes, I concluded that the appeals have more to do with providing a
forum for the Appellant's antitax theories than seeking a determination of the
correctness of the assessments. Interestingly, though the Appellant fervently objects
to paying taxes himself, he has no qualms about availing himself of the various
government services paid for by the tax dollars of hardworking Canadians who
regularly fulfill their obligations under the Act.
[17] All in all, the arguments advanced and the materials filed by the Appellant lead
me to believe that the Notices of Appeal have little, if anything, to do with seeking
the relief provided under the Act and were a waste of the time of the Court and the
Respondent and of taxpayers' dollars. In such circumstances, I am mindful of the
words of the Federal Court of Appeal in Dominique Fournier v. Her Majesty the
Queen, 2005 FCA 131:
[11] The judge stated that he had no jurisdiction to impose costs on an appellant
who unnecessarily delayed an appeal process initiated within an informal
proceeding. I should point out that the Tax Court of Canada has the inherent
jurisdiction to prevent and control an abuse of its process: see Yacyshyn v. Canada,
[1999] F.C.A. No. 196 (F.C.A.).
9 See such cases as Hovey Ventures Inc. v. Her Majesty the Queen, 2007 TCC 139; R. v. Sydel,
[2006] 5 C.T.C. 88 (British Columbia Provincial Court); Kennedy v. Canada (Customs &
Revenue Agency), [2000] O.J. No. 3313 (Ontario Supreme Court of Justice); R. v. Lindsay,
[2006] B.C.J. No. 636, 2006 BCCA 150 (B.C.C.A.).
Page: 7
[12] The awarding of costs is one mechanism for preventing or remedying

abusive delays or procedures: see Blencoe v. British Columbia (Human Rights
Commission), [2000] 2 S.C.R. 307, at paragraphs 179 and 183. In Sherman v.
Canada (Minister of National Revenue - M.N.R), [2003] 4 F.C. 865, at paragraph
46, this Court addressed the issue in the following terms:
It is now generally accepted that an award of costs may perform

more than one function. Costs under modern rules may serve to
regulate, indemnify and deter. They regulate by promoting early
settlements and restraint. They deter impetuous, frivolous and
abusive behaviour and litigation. They seek to compensate, at least in
part, the successful party who has incurred, sometimes, large
expenses to vindicate its rights. [Emphasis appears in original.]
[18] The striking out of a pleading is a drastic step and one which ought not to be
taken lightly. Having carefully reviewed the pleadings and considered the
submissions of the parties, however, I am persuaded by the Respondent's argument
that the Notices of Appeal ought to be struck out in their entirety and the appeals
dismissed. Given the frivolous and abusive nature of the pleadings, I am further
satisfied that circumstances warrant the exercise of my discretion to impose costs
against the Appellants to prevent and control an abuse of the process of the Tax
Court of Canada. Accordingly, the Appellants, Trueman Tuck and Yvonne Tuck,
shall each pay costs to the Respondent in the amount of $100.
"G.A. Sheridan"
Sheridan J.
BETWEEN:
HOVEY VENTURES INC.,
Appellant,
and

Respondent.
Motion heard on February 13, 2007 at Vancouver, British Columbia
Before: The Honourable Justice G. Sheridan
Appearances:
Counsel for the Appellant: Douglas H. Christie
Counsel for the Respondent: David Everett
JUDGMENT
Upon motion by the Respondent:
(a) for an Order under paragraph 58(1)(b) of the Tax Court of Canada
Rules (General Procedure) ("Rules") striking out the Notice of Appeal
because it discloses no reasonable grounds for appeal;
(b) in the alternative, an Order under paragraph 53(b) of the Rules to strike
out the Notice of Appeal on the ground that the Notice of Appeal is
scandalous, frivolous or vexatious;
(c) in the further alternative, an Order under paragraph 53(c) of the Rules to
strike out the Notice of Appeal on the ground that the Notice of Appeal
is an abuse of process;
Page: 2
(d) in the further alternative, an Order under paragraph 44(1)(b) of the

Rules extending the time in which the Respondent may file a Reply to
the Notice of Appeal; and
(e) costs.
And having heard the submissions of counsel and read the materials filed by
the parties;
It is ordered that:
1. the Notice of Appeal be struck out pursuant to paragraph 58(1)(Z?) of the

Tax Court of Canada Rules (General Procedure); and
2. the appeal is dismissed with costs to the Respondent, in accordance with

the attached Reasons for Order.
Signed at Ottawa, Canada, this 15th day of March, 2007.
"G. Sheridan"
Sheridan, J.
Date: 20070315
BETWEEN:
HOVEY VENTURES INC,
Appellant,
and

Respondent.
REASONS FOR JUDGMENT
Sheridan. J.
[1 ] The Respondent brings a motion for an Order:
(a) under paragraph 58(1)(&) of the Tax Court of Canada Rules (General
Procedure) ("Rules") striking out the Notice of Appeal because it
discloses no reasonable grounds for appeal;
(b) in the alternative, an Order under paragraph 53(b) of the Rules to strike
out the Notice of Appeal on the ground that the Notice of Appeal is
scandalous, frivolous or vexatious;
(c) in the further alternative, an Order under paragraph 53(c) of the Rules to
strike out the Notice of Appeal on the ground that the Notice of Appeal
is an abuse of process;
(d) in the further alternative, an Order under paragraph 44(1)(b) of the

Rules extending the time in which the Respondent may file a Reply to
the Notice of Appeal; and
(e) costs.
[2] The Appellant, Hovey Ventures Inc., was assessed by the Minister of National
Revenue for its failure to comply with a Requirement to Pay issued under Section
224 of the Income Tax Act. Pursuant to the Requirement to Pay, the Appellant was
Page: 2
assessed for amounts owed to Witold Loykowski, the tax debtor named in the
Requirement to Pay.
[3] The Appellant filed a Notice of Appeal, challenging the assessment on the
basis that it was not liable for any amounts under the Requirement to Pay assessment
because, at all times relevant to the appeal, the tax debtor was acting in his capacity
as a "natural person". According to the Appellant, a "natural person" is not subject to
pay tax under the Act and therefore, the Canada Revenue Agency was without
authority to assess the Appellant for any amounts it paid to the tax debtor for his
services pursuant to their agreement. This theory has been used, without success, by
defendants facing tax evasion charges. In the recent case of R. v. Sydel\ Meyers,
P.C.J., rejected the "natural person" argument which he summarized as follows:
.. .[that] there is not proof beyond a reasonable doubt, that Parliament intended to tax
people who declare themselves to be "natural persons"; any money earned by an
individual in their capacity of a "natural person", as opposed to their capacity as a
taxpayer or legal representative of the taxpayer is not subject to the Income Tax Act
requirement to pay taxes, nor are they required by the Income Tax Act, to file T1
Individual Income Tax returns.2
[4] According to the Respondent, the "natural person" premise upon which the
Notice of Appeal is based is completely without merit. Further, the Crown argues
that even if the "natural person" argument may properly form the basis for a
challenge to the constitutionality of the Requirement to Pay provisions, such a claim
is not properly brought before the Tax Court of Canada as its jurisdiction does not
extend to the alleged inappropriateness of the actions of the Minister's officials:
[7] ... Courts have consistently held that the actions of the CCRA cannot be
taken into account in an appeal against assessments.
[8] This is because what is in issue in an appeal pursuant to section 169 is the
validity of the assessment and not the process by which it is established. ... Put
another way, the question is not whether the CCRA officials exercised their powers
properly, but whether the amounts assessed can be shown to be properly owing
under the Act (Ludco Enterprises Ltd. v. R. [1996] 3 C.T.C. 74 (F.C.A.) at p.84).3
1 [2006] 5 C.T.C. 88 (British Columbia Provincial Court).

2Supra, at paragraph 7. For a list of the cases upon which Meyers, P.C.J, relied to reject the
"natural person" defence, see paragraph 8.
3 Main Rehabilitation Co. Ltd. v. Her Majesty the Queen, 2004 FCA 403. See also
Hardtke v. Canada, [2005] T.C.J. No. 188.
Page: 3
[5] Counsel for the Respondent went on to say that, although most of the Notice
of Appeal is devoted to the "natural person" argument, what few facts there are
support the correctness of the Minister's assessment: in paragraphs 2, 4 and 5 of
Part 2: The Material Facts Relied Upon the Appellant alleges that there was a
written agreement between the Appellant and the tax debtor4 for the performances of
services, such services were performed by the tax debtor who received compensation
for them from the Appellant during the relevant period5. Furthermore, nowhere in the
Notice of Appeal is there any challenge to the amount assessed. For the purposes of
considering an application to strike, the facts in the pleadings must be taken as
proved6. Counsel for the Respondent submitted it would be improper for the Court to
allow the Appellant to use affidavit evidence to bolster pleadings which are, on their
face, defective.
[6] For these reasons, the Respondent's position is that the present case is one
where it is "plain and obvious"7 that the Appellant's case discloses no reasonable
cause of action and accordingly, it ought to be struck out under Rule 58(1){b) or
alternatively, under Rules 53(b) or (c) for being, "respectively, scandalous, frivolous
and vexatious", or "an abuse of process". Counsel for the Respondent submitted that
a Notice of Appeal which discloses no reasonable cause of action or which is beyond
the jurisdiction of the Court is, by definition, an abuse of process8.
[7] Counsel for the Appellant opposed the motion, arguing that it was by no
means "plain and obvious" that the appeal had no chance of success. In his view, the
jury was still out on the "natural person" argument, although he offered no case law
in support of that position. He did, however, advise the Court that he had been
counsel for the accused in the Sydel case, which, as of this hearing date, was being
challenged on other grounds. He argued that affidavit evidence was properly
admissible on an application to strike and urged the Court take into account the
contents of two affidavits: that of Troy Hovey, president of Hovey Ventures Inc. and
of Witold Loykowski, the tax debtor named in the Requirement to Pay.
4 Notice of Appeal, Paragraph 4.

5 Notice of Appeal, Paragraph 5.
6 Hunt v. Carey Canada Inc., [ 1990] 2 S.C.R. 959 at paragraph 31.
7 Supra, Creaghan Estate v. Canada, [1972] F.C.732 at page 736, (F.C.T.D.).
8 Telus Communications (Edmonton) Inc. v. Canada, [2005] F.C.J. No. 775.
Page: 4
[8] The Appellant had not filed an application to seek leave to amend its Notice of
Appeal. However, midway through the submissions of counsel for the Appellant, I
asked counsel whether that possibility had been considered prior to the Respondent's
motion. Counsel for the Respondent replied that he had raised the subject with
counsel for the Appellant when he [Mr. Christie] became counsel of record. The only
response he received was service of the Appellant's affidavits which were, at that
point, intended only for use in resisting the order to strike. While not responding
directly to my question, counsel for the Appellant signaled his interest in seeking
leave to amend and suggested that even if the affidavits were inadmissible for the
purposes of the Respondent's motion, they ought to be considered in respect of the
Appellant's request for leave to amend.
[9] Not surprisingly, the Respondent was opposed to the Appellant's request,
arguing that the defects of the Notice of Appeal were such that they could not be
cured by a simple rewrite and that the affidavits (even if admissible) were equally
flawed. Mindful of the consequences to the Appellant if an order to strike were
granted, however, I felt compelled to consider the Appellant's lastminute request
for leave to amend. I did so with some reluctance given the circumstances in which
such leave was sought; it seems to me that in filing affidavits to resist the
Respondent's motion, the Appellant recognized certain weaknesses in the Notice of
Appeal and yet, chose not to take the proper steps to have it amended. In any event,
turning to the Appellant's request for leave to amend, in Sweet v. Canada9 Decary,
J. considered the balancing act required in determining whether to strike out an
appeal or to permit amendments to it:
21 It is not the duty of a judge to redraft pleadings. It is his or her duty,

however, to closely examine a proceeding before determining that it cannot be saved
through proper amendments. To use the words of my brother Stone in Krause ..., the
judge seized with a motion [to strike pleadings10] must decide whether the document
is "so defective that it cannot be cured by simple amendment". This determination
requires a balancing act which cannot be subject to any definite norms. Each
proceeding is to be assessed on its own merits, with consideration being given to,
inter alia, the personal situation of the party, the issues and arguments raised, the
manner and tone in which they are raised, the number and proportion of allegations
that are defective and the readiness of the amendments needed. Where the Court is
dealing with a selfrepresented litigant, it should resist being too easily put off by the
9 [1999] F.C.J. No. 1539 (F.C.A.).

10 On the grounds that the pleadings were "scandalous, frivolous and vexatious".
Page: 5
mere phrasing of allegations and arguments that do not fall within established legal
parameters. [Footnote added.]
[10] Having considered the Notice of Appeal and supporting affidavits in light of
the Sweet factors, I agree with the Respondent's position that the Notice of Appeal is
"so defective it cannot be cured by simple amendment". The first step in Sweet is to
consider the "situation of the Appellant", including whether the Appellant is
selfrepresented. In the present case, the Notice of Appeal is signed by
"Troy Hovey", president of the Appellant. Below his signature appear the words
"Legal Counsel yet to be retained", suggesting that the Notice of Appeal was drafted
without the benefit of legal advice. By the time of the motion to strike, the Appellant
was represented by counsel; indeed, by counsel who according to his own
intervention, had considerable experience with the "natural person" argument upon
which the Notice of Appeal is based. The "natural person" argument that dominates
Part V: Reasons Relied Upon by Appellant of the Notice of Appeal employs the same
sort of language used in the "natural person" cases cited11 by the Court in Sydel. In
these circumstances, the most likely conclusion is that the Appellant intended to
frame its pleadings as it did; the defects in the Notice of Appeal are not attributable to
the Appellant's stated lack of legal counsel at the time it was drafted. As for the
"issues and arguments raised" in the Notice of Appeal, again, they are all premised
solely on the "natural person" argument and are presented in a "manner and tone"
more in keeping with the advancement of an antitax campaign than an assertion of
the incorrectness of the assessment. Probably for the same reasons, of "the number
and proportion of allegations that are defective", all but some portions of a few
paragraphs of the Notice of Appeal are dedicated to the "natural person" argument.
[11] As for the affidavits, while unlike the Notice of Appeal, they call into question
the amount assessed, the information deposed is contradictory and ambiguous; one
has only to compare paragraph 5 of Part 2 of the Notice of Appeal with paragraph 4
of the affidavit of Troy Hovey in respect of the performance of services and the
receipt of compensation. More damning, the contents of the affidavits, like the Notice
of Appeal, are skewed by the affiants' fundamental belief that, as a "natural person",
the tax debtor was not taxable.
11 HMTQ v. Galbraith [2001] B.C.J. No. 2900, 2001 BCSC 675; R. v. Dick [2003] B.C.J.
No. 187, 2003 BCPC 13 (B.C. Prov. Ct.); R. v. Carew [1992] B.C.J. No. 995 (BCSC);
R. v. Sullivan [1991] 1 S.C.R. 489; PPG Industries Canada Ltd. v. Canada [1983] B.C.J.
No. 2260 (BCSC); Kennedy v. Canada Customs & Revenue Agency [2000] O.J. No. 3313
(Ontario Supreme Court of Justice); R. v. Lindsay [2006] B.C.J. No. 636, 2006 BCCA 150.
Page: 6
[12] All in all, I agree with counsel for the Respondent that more than a simple
rewrite would be necessary to rehabilitate the Notice of Appeal; indeed, it would
require the Court to engage in the sort of judicial redrafting specifically warned
against in Sweet. Accordingly, the Appellant's request for leave to amend is denied.
[13] Returning now to the Respondent's motion, having heard the submissions of
counsel and read the materials filed, I am persuaded that the Respondent has made
its case for the striking out of the Notice of Appeal under paragraph 58(1 )(b) of the
Tax Court of Canada Rules (General Procedure) and that the Notice of Appeal must
be considered as drafted, not as further clarified in supporting affidavits12. Paragraph
58(2)(6) of the Rules provides that "no evidence is admissible on an application
[under paragraph 58(1)(&)]". However, even if I had admitted the affidavits, for the
reasons set out above in respect of the Appellant's request for leave to amend, their
contents would not have persuaded me that the Notice of Appeal disclosed a
reasonable cause of action. In my view, the "natural person" argument is without
merit; further, the Tax Court of Canada is without jurisdiction to consider the issues
raised with respect to the correctness of the actions of the CRA in assessing the
Appellant under the Requirement to Pay. To the extent that there are facts buried in
the "natural person" argument, when taken as proven, they do not set out a basis upon
which the Appellant could successfully challenge the correctness of the assessment
under the Requirement to Pay. The Notice of Appeal is struck out pursuant to
paragraph 58(1)(b) of the Tax Court of Canada Rules (General Procedure) and the
appeal is dismissed with costs to the Respondent.
Signed at Ottawa, Canada, this 15th day of March, 2007.
"G. Sheridan"
Sheridan, J.
12 Burleigh v. Canada, [2004] 2 C.T.C. 2797 at paragraph 2, (T.C.C.), Bowman, A.C.J, (as he
then was).
BETWEEN:
ADRIAN CASSA,
Appellant,
and

Respondent.
Motion heard on January 21, 2013 at Toronto, Ontario and Reasons for
Order delivered orally from the Bench on January 23, 2013
Before: The Honourable Justice Diane Campbell
Appearances:

Counsel for the Respondent: H. Annette Evans
Rishma Bhimji
ORDER
UPON Motion by the Respondent dated January 10, 2013 for:
1. An Order striking the Amended Notice of Appeal filed on

November 20, 2012;
2. In the event that this Court does not grant an Order striking out the
Amended Notice of Appeal and/or dismissing the Appeal, an Order
extending the time for the respondent to serve and file a Reply to the
Amended Notice of Appeal to 60 days after the date of the Order
disposing of the within motion;
Page: 2
3. In the alternative, in the event that the Court grants an Order allowing
the appellant leave to amend by permitting filing of a Further Amended
Notice of Appeal, an Order extending the time for the Respondent to
serve and file a Reply to the Further Amended Notice of Appeal to 60
days after the date of service ofthe Further Amended Notice of Appeal;
and
4. The costs of this motion in any event of the cause;
(Respondent's Amended Notice of Motion, pages 1 and 2, paragraphs 1 to 4)
AND WHEREAS, at the hearing of the Motion, Counsel for the Respondent
amended the relief sought to include the Appellant's Further Amended Notice of
Appeal filed January 17,2013, which was filed by the Appellant subsequent to being
served with the Respondent's Amended Notice of Motion;
AND UPON hearing submissions of the parties;
IT IS ORDERED THAT:
The Respondent's Motion to strike the Amended Notice of Appeal filed on

November 20, 2012 and the Further Amended Notice of Appeal filed on January 17,
2013 is granted;
Costs are awarded to the Respondent in the amount of $1,000, payable by the
Appellant forthwith;
All in accordance with the attached Reasons for Order.
Signed at Ottawa, Canada, this 1st day of February 2013.
"Diane Campbell"
Campbell J.
Citation: 2013TCC43
Date: 20130201
BETWEEN:
ADRIAN CASSA,
Appellant,
and

Respondent.
REASONS FOR ORDER
Campbell J.
[1] This is a Motion by the Respondent to strike the Appellant's Further Amended
Notice of Appeal filed with the Court on January 17, 2013.
[2] The Appellant made two prior attempts to the filing of his Further Amended
Notice of Appeal with a Notice of Appeal originally filed on July 20, 2012 and an
Amended Notice of Appeal filed on November 20, 2012.
[3] The content in all of the Appellant's documentation is similar to those that
were before me on Motions by the Respondent in June of last year. These appeals
form part of a large group that I have been assigned to case manage. About half are
represented by legal counsel while the remainder are selfrepresented. Because of the
thread of similarities in wording in hundreds of these appeals, it is apparent that these
Appellants have received "counsel" from a third party. Such third parties are referred
to by Associate Chief Justice Rooke of the Alberta Court of Queen's Bench in Meads
v. Meads, 2012 ABQB 571, as "gurus".
Page: 2
[4] The majority of the appeals that have come before me on these Motions have
employed the following argument in order to have their tax returns accepted as filed
and presumably avoid the proper payment of the appropriate taxes or the avoidance
of other tax obligations that the Income Tax Act (the "Act') might otherwise impose
upon them. That argument goes like this: If the Minister of National Revenue (the
"Minister") does not issue a Notice of Confirmation within the time set out in
paragraph 169(1)(6) ofthe Act, then the taxpayer's return has not been "proved to be
incorrect" and shall be accepted as filed. Therefore, it follows that this Court should
vacate the Minister's assessment.
[5] I dealt with this issue in my Reasons in similarly worded appeals that were
before me in June, 2012. At that time, I canvassed the caselaw, including a number of
Federal Court of Appeal decisions and made it clear that vacating an assessment for
the Minister's delay will not be an appropriate remedy and not one that I would grant.
In those same Reasons, I made it clear that the documentation required to commence
their appeals in this Court must comply with the Tax Court of Canada Rules
(GeneralProcedure) (the "Rules") and, particularly, Form 21A that is, the Notices
of Appeal must contain 1) the material facts upon which they rely to dispute the
assessment and 2) a statement of the issues that will be before this Court.
[6] Almost all of these appeals are commenced pursuant to the general procedure
Rules and therefore must comply with the proceduralrules that govern those types of
appeals. The first step is to file the proper Notice of Appeal one to which the
Crown can properly respond. I have attempted to give as much guidance and time as
possible to these selfrepresented individuals, being mindful that each of them have
chosen to come to this Court to representthemselves. They have every right to do so.
However, it must be remembered that I cannot provide legal advice, that they must
either retain legal counselor representthemselves and not through agents, trustees or
powers of attorney and, finally, that this is a court, not a forum for debate with the
presiding Judge.
[7] The Respondent is requesting that I strike the Appellant's Amended Notice of
Appeal and Further Amended Notice of Appeal pursuant to Rule 53 of the Rules.
[8] Rule 53 reads as follows:
53. The Court may strike out or expunge all of part of a proceeding or other
document, with or without leave to amend, on the grounds that the pleading or other
document,
Page: 3
(a) may prejudice or delay the fair hearing of the action,
(b) is scandalous, frivolous or vexatious, or
(c) is an abuse of the process of the Court.
This provision gives the Court a power which must be exercised with great care and
only in exceptional circumstances. As stated at paragraph 11 by former Chief Justice
Bowman in SentinelHill1999Master LimitedPartnership (Designated member of)
v. The Queen, 2007 TCC 742, "... their application should be reserved for the
plainest and most egregiously senseless assertions At paragraph4, he outlined
the principles that this Court should apply on a Motion to strike:
[4] I shall begin by outlining what I believe are the principles to be applied on
a motion to strike under Rule 53. There are many cases in which the matter has
been considered both in this court and the Federal Court of Appeal. It is not
necessary to quote from them all as the principles are well established.
(a) The facts as alleged in the impugned pleading must be taken as true
subject to the limitations stated in Operation Dismantle Inc. v.
Canada, [1985] 1 S.C.R. 441 at 455. It is not open to a party
attacking a pleading under Rule 53 to challenge assertions of fact.
(b) To strike out a pleading or part of a pleading under Rule 53 it must

be plain and obvious that the position has no hope of succeeding.
The test is a stringent one and the power to strike out a pleading
must be exercised with great care.
(c) A motions judge should avoid usurping the function of the trial judge
in making determinations of fact or relevancy. Such matters should
be left to the judge who hears the evidence.
(d) Rule 53 and not Rule 58, is the appropriate rule on a motion to strike.
[9] Now, when I look at the Appellant's three attempts at getting his Notice of
Appeal to comply with the Rules, he has failed to do so even in regard to the most
basic aspect of his appeal: his decision to forge ahead with his paragraph 169(1)(&)
argument despite my June 2012 Reasons and despite sitting in court listening to me
reiterate to a number of Appellants that preceded him that that argument was without
merit and could not succeed. Even if I separate that portion of the appeal document
that deals with paragraph 169(1)(Z>), the balance contains disjointed and meaningless
statements and assertions that have no hope of succeeding in this Court or any other.
While Mr. Cassa's oral submissions might have shed some light on what material
Page: 4
facts he was actually relying upon, they instead muddied the waters even further.
They amounted to nothing more than an absurd blend of the ridiculous arguments he
included in his appeal documents. His documentation and his submissions engaged in
the socalled "detaxer" language. Those included:
"the Appellant, Adrian Cassa, acted as agent for an undisclosed

Principal";
"Principal is a livingsoul, fleshandblood man";
"Principal is commonly called Adrian of the Cassa family";
"Principal earned wages in exchange for labour";
"the wages were collected by Appellant";
"Appellant incurred labour expenses";
"Appellant did not use or benefit from any Expenses".
And continuing on, the Appellant claims:
"an individual is not defined as being a man under the ITA";

"in Section248(l) of the ITA a business is an "undertaking of any kind
whatever"";
"acting as an agent is a business";
"without Principal, Appellant could not continue acting as an agent";
"without Appellant, Principal could not continue to labour".
And in reference to this last statement, he contended in his submissions that the Act
contains no provision which allows government to tax labour. The Appellant also
suggested 1 was required to take judicial notice of the difference between facts and
inference, between facts and conjecture and between facts and assumptions.
[10] Included in his appeal was a list of the endless statutory provisions he intended
to reply upon. Those included "the Bills of Exchange Act, Canadian Charter of
Rights and Freedoms, Canadian Bill of Rights, Income Tax Act of Canada, Income
War Tax Act, 1917, Civil Code of Quebec, Canada Evidence Act, UNCITRAL, Vital
Statistics Act, UPU Agreements, Criminal Code and UCC" (Amended Notice of
Appeal, paragraph 37). However, he gives no indication of why or how he intended
to incorporate this divergent and largely irrelevant array of legislation into his appeal
and, more particularly, the precise provisions of each piece of legislation upon which
he intended to rely.
Page: 5
[11] The Appellant's Further Amended Notice of Appeal is fraught with

incomprehensible arguments and allegations. It fails to identify any specific material
facts and focuses almost entirely on avoiding obligations imposed under the Income
Tax Act.
[12] I referred in the beginning of these Reasons to the Meads case. The Appellant
referred to the decision as "prejudicial and premature" in an attempt to persuade me, I
assume, to ignore those Reasons. Of course, that suggestion is as absurd as many of
his other assertions. The Meads decision contains an exhaustive review and analysis
of litigants who engage in a variety of litigation techniques and arguments, promoted
by socalled gurus and designed to interfere with court operations and proceedings.
Associate Chief Justice Rooke refers to such litigants under the global name
"Organized Pseudolegal Commercial Argument Litigants" ("OPCA"), although he
acknowledges that they may be identified by any number of names and that some
such individuals and groups have no particular identity except for the types of
arguments and schemes they attempt to put before the Canadian courts.
[13] Among many other such groups, the Meads decision identifies specifically the
socalled "detaxers" or those attempting to avoid income tax obligations as well as
the "freemen on land" notion and the double or split person concept. The Cassa
appeal contains all of the foregoing elements. In the Further Amended Notice of
Appeal, the Appellant refers to the "principal" as commonly called "Adrian of the
Cassa family". In the Certificate of Service, he engages in the following similar
language: "Comes, Adrian Cassa, as agent for the free will man, commonly called
Adrian of the Cassa family, the undisclosed principal". Apparently, this is a common
strategy in which such litigants engage. As the Meads decision notes, this duality
argument is both a strange and confusing concept which uses an artificial and
fictitious division of the person in an attempt to support an otherwise absurd
argument. Whatever it is, it is without merit, it detracts from the court proceedings
and it is total and utter nonsense. My method of dealing with any attempt by the
Appellant to employ this nonsense in my Court was to simply ignore it.
[14] The majority of the Appellant's proposed appeal is peppered throughout with
many of the concepts and language referred to in Meads. It contains statements and
assertions that are unintelligible, incomprehensible, meaningless, irrelevant and
factually hopeless. I consider those types of arguments an abuse of the Court's
processes. Such "song and dance" routines hinder and limit the availability of Court
resources for those selfrepresented litigants who are making an honest attempt to
advance their appeals through the Court system in a timely manner.
Page: 6
[15] I will allow the Respondent's Motion to strike the Appellant's Further
Amended Notice of Appeal, with costs to the Respondent of $1,000 payable
forthwith. As Case Management Judge, although these Reasons have been delivered
orally, I intend to have them issued forthwith in writing. There are other such appeals
waiting in the wings and I trust that my Reasons will give some guidance on the type
of statements and assertions that cannot and will not promote the advancement of
their appeals. Those Appellants that remain unsure of the avenue they should pursue
may benefit from retaining legal counsel. As Case Management Judge, it is my aim
to move the appeals along in an orderly fashion with the end result being a fair
hearing for all those Appellants that comply with the Rules governing these
proceedings and any Reasons that I have issued or will be issuing.
Signed at Ottawa, Canada, this IstdayofFebruary2013.
"Diane Campbell"
Campbell J.
BETWEEN:
ELIO DALLE RIVE,

Appellant,
and

Respondent.
Motion heard on July 19, 2013 at Toronto, Ontario
By: The Honourable Justice Judith M. Woods
Appearances:
Counsel for the Respondent: H. Annette Evans

Rishma Bhimji
JUDGMENT
UPON motion by the respondent for an order striking out the notice of appeal
and dismissing the appeal with costs,
IT IS ORDERED THAT:
1. the motion is granted,
2. the notice of appeal filed with the Registry on February 20, 2013 is struck out
in its entirety without leave to amend,
3. the appeal is dismissed, and

Page: 2
the respondent is entitled to costs, fixed in the amount of $1,000, which shall
be paid by the appellant to the respondent no later than August 15, 2013.
Signed at Toronto, Ontario this 30th day of July 2013.
"J. M. Woods"
Woods J.
Citation: 2013 TCC 243
Date: 20130730
BETWEEN:
ELIO DALLE RTVE,

Appellant,
and

Respondent.
WoodsJ.
[1] The Crown brings a motion for an orderto strike out the notice ofappeal in its
entirety and to dismiss the appeal with costs.
[2] The notice ofappeal sets out the issues to be decided in the appeal as follows:
D. ISSUES TO BE DECIDED
16. CROWN to provide proof that the Income Tax Act, and all other Statutory
Regulations and Enactments do apply to the flesh and blood, human being
named above as Elio, child of God, an individual, of the family Dalle Rive.
17. Legal recourse against all parties continuing with unlawfully attacking and
forcing involuntary servitude, involuntary contracts and the unlawful
enforcement of any other judicial jurisdiction other than Inherent Jurisdiction
upon Elio, child of God, an individual, of the family Dalle Rive.
All parties to be accountable under their full commercial liability.
[3] The Crown submits that the notice of appeal has the same fatal defects that the
Court considered in Cassa v The Queen, 2013 TCC 43. In Cassa, Justice Campbell
referred to the decision oi Meads v Meads, 2012 ABQB 571, and comments as
Page: 2
follows:
[14] The majority of the Appellant's proposed appeal is peppered throughout with
many of the concepts and language referred to in Meads. It contains statements and
assertions that are unintelligible, incomprehensible, meaningless, irrelevant and
factually hopeless. I consider those types of arguments an abuse of the Court's
processes. Such "song and dance" routines hinder and limit the availability of Court
resources for those selfrepresented litigants who are making an honest attempt to
advance their appeals through the Court system in a timely manner.
[4] I agree with the Crown's submission. It is clear based on the language used in
the notice ofappeal, and the appellant's submissions at the hearing, that this is
vexatious litigation of the type described by Rooke A.C.J, in Meads, at para 1:
[1] [...] These persons employ a collection of techniques and arguments promoted
and sold by "gurus" (as hereafter defined) to disrupt court operations and to attempt
to frustrate the legal rights of governments, corporations, and individuals.
[5] It would be an abuse of the process ofthis Court for this litigation to proceed.
[6] I will grant the respondent's motion to strike out the notice of appeal without
leave to amend and will dismiss the appeal.
[7] I would award costs to the respondent fixed in the amount of $1,000, which
shall bepaid by the appellant to the respondent no later than August 15, 2013.
Signed cit Toronto ^"^TnK/ oni ^
"J. M. Woods"
Woods J.
BETWEEN:
FRANK JOSEPH BERTUCCI,
Appellant,
and

Respondent.
Appeal heard on July 11, 2014, at Toronto, Ontario
Before: The Honourable Justice Valerie Miller
Appearances:

Counsel for the Respondent: Christian Cheong
JUDGMENT
The appeal from the assessments made under the Income Tax Act for the
Appellant's 2001 and 2002 taxation years is dismissed.
Signed at Ottawa, Canada, this 17th day of July 2014.
"V.A. Miller"
V.A. Miller J.
Date: 20140717
BETWEEN:
FRANK JOSEPH BERTUCCI,
Appellant,
and

Respondent.
V.A. Miller J.
[1] The Appellant failed to file income tax returns for the 2001 and 2002
taxation years and the Minister of National Revenue (the "Minister") assessed him
on October 26, 2009 pursuant to subsection 152(7) of the Income Tax Act (the
"ITA").
[2] In assessing the Appellant, the Minister made the following assumptions of
fact:
2001 Taxation Year
a) in the 2001 taxation year, the appellant was engaged by Canada Post to
provide mail delivery services as an independent contractor;
b) on December 7, 2001, the appellant assigned his rights and responsibilities

with respect to the agreement between himself and Canada Post, dated
August 29, 2001, to 1483740 Ontario Ltd.;
c) 1483740 Ontario Ltd. was wholly owned by the appellant;
d) 1483740 Ontario Ltd. was incorporated November 14,2001;
e) 1483740 Ontario Ltd. reported $nil revenue and $nil income in its return
of income for the 2001 taxation year;
Page: 2
f) in the 2001 taxation year, Canada Post paid $ to the appellant as

remuneration for services he provided;
g) at all relevant times, the appellant was also engaged in the direct selling of
products from ForMorCanada Inc., to customers as an independent
agent;
h) in the 2001 taxation year, ForMor Canada Inc. paid $ in commission

income to the appellant;
i) for the 2001 taxation year, Greenock Resources also paid $ in

commission income to the appellant;
2002 Taxation Year
j) the Minister completed a trust audit exam of the payroll account for
1483740 Ontario Inc. for its 2002 taxation year;
k) in the 2002 taxation year, 1483740 Ontario Inc. paid $ to the

appellant;
1) for the 2002 taxation year, this Court [2007 TCC 258] held that the
appellant was a subcontractor of 1483740 Ontario Inc. and received
approximately $ per month as remuneration for his services;
m) for the 2002 taxation year, ForMor Canada Inc. paid $ in

commission income to the appellant; and
n) for the 2002 taxation year, Canada Post paid $ to the appellant.
[3] At the hearing, the Appellant agreed with all of the assumptions except
paragraph (i). He stated that he did receive $ in commission income in 2001
but it was from Alive International Inc. and not Greenock Resources.
[4] In May 2002, the Canada Revenue Agency ("CRA") issued a Demand that
the Appellant file his 2001 income tax return. He replied to the Demand by
questioning (i) whether the Demand was in compliance with subsections 150(1)
and (2) of the ITA and (ii) who was the person claiming to have not received the
return. He did not file his returns for 2001 or 2002.
[5] At the beginning of the hearing, the Appellant stated that he did not intend to
be adversarial; he was in court to represent the "little people" by finding ways to
minimize his taxes. It was his position that in 2001 and 2002 he was engaged as an
independent contractor and the ITA did not apply to independent contractors. He
Page: 3
also argued that the ITA is incomprehensible to the common person and it should
not apply.
[6] Although the Appellant stated that he did not belong to a particular group, he
used the concepts and terminology associated with the Organized Pseudolegal
Commercial Argument ("OPCA") litigant who was described by J.D. Rooke
A.C.J.Q.B. in Meads v Meads, 2012 ABQB 571. The Appellant relied on a
plethora of legislation (none of which was relevant except the ITA); legal maxims;
definitions from the Canadian Law Dictionary; forms and letters from the CRA;
and forms from various departments in the Ontario government. He stated that the
forms from the CRA were not clear whereas the forms from the Ontario
government were unambiguous; he questioned whether the T1 form with the
General Income Tax and Benefit Guide was "legitimate"; and, whether the CRA
represents the Minister of National Revenue. It appeared to me that the essence of
his argument was that the definition of "person" in the ITA did not clearly state that
it applied to him as a "human being, a private individual" and an independent
contractor.
[7] It is my view that the Appellant, like most litigants who use the tactics of
saying that the ITA does not apply to them, did not realty misunderstand the ITA. In
the present case, the Appellant did not misunderstand the definition of "person" in
the ITA. His actions and letters to the CRA indicated a "conscious intention to
disobey". See Meads {supra) at paragraph 561. The Appellant was not trying to
minimize his taxes but was avoiding the payment of any taxes. There was
absolutely no merit to any of his arguments.
[8J In conclusion, the Appellant was a "person" resident in Ontario, Canada in

2001 and 2002 and the income he received in those years is taxable. There was
never a dispute that he received income of $ and $ in 2001 and 2002
respectively and that he did not file his income tax returns for those years. Late
filing penalties were correctly assessed against the Appellant. The appeal is
dismissed.
Signed at Ottawa, Canada, this 17th day of July 2014.
"V.A. Miller"
V.A. Miller J.
'0-
Imxt b'uppti ftbttuh

fmmfi
Date: 20141217
Dockets: A-340-13
A-120-14
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Citation: 2014 FCA 301 C O
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STRATAS J.A. <
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BETWEEN:
IAN E. BROWN
Appellant
and
Respondent
Heard at Toronto, Ontario, on September 10, 2014.
Judgment delivered at Ottawa, Ontario, on December 17,2014.
REASONS FOR JUDGMENT BY: WEBB J.A.
CONCURRED IN BY. PELLETTER J.A.

STRATAS J.A.
m;
Date: 20141217
Dockets: A-340-13
A-120-14
sz
Citation: 2014 FCA 301 a
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BETWEEN:
IAN E. BROWN
Appellant
and
Respondent
WEBB J.A.
[1] Ian Brown filed a notice ofappeal (A12014) in relation to the order of Campbell J.
dated January 27, 2014 (Docket: 20133386 (IT) I) striking Mr. Brown's Notice of Appeal dated
September 10, 2013, Amended Notice of Appeal dated January 15, 2014 and Fresh Notice of
Appeal dated January 20, 2014, which he had filed under the Income Tax Act, R.S.C. 1985, c. 1
(5th Supp.) (the Act). Mr. Brown was attempting to appeal a reassessment of his 2010 taxation
year. Mr. Brown also filed a notice ofappeal (A34013) from the order of Boyle J. dated
Page: 2
September 25, 2013 (Docket: 20123456 (IT) G) striking his amended notice of appeal and
dismissing his appeal in relation to the assessments for the 2006, 2007, 2008 and 2009 taxation
years.
[2] Although these appeals were not consolidated, Mr. Brown raised the same issue in both
appeals in relation to the assessment of penalties under subsection 163(2) of the Act (gross
negligence penalties). In the appeal filed as A34013, Mr. Brown also raised an argument
related to the constitutional validity of the Act. At the hearing Mr. Brown addressed the
arguments for both appeals at the same time. As a result, these reasons will apply to both appeals
and a copy of these reasons will be placed in each file.
Background
[3] In filing his income tax return for 2009, Mr. Brown claimed a toss from a business of
$ . He also submitted the form to request that $ of this loss from a business from
2009 be carried back to previous taxation years as a noncapital loss as follows: $ to 2008,
to 2007 and to 2006. In filing his income tax return for 2010, he claimed a loss
from a business of $ .
[4] The Minister of National Revenue denied the losses from a business that he claimed in
2009 and 2010. Since the loss from a business for 2009 was denied, he was also denied the non
capital loss that he was attempting to carry back from 2009 to 2008, 2007 and 2006. Gross
negligence penalties were also assessed in relation to the losses from a business that he had
claimed in each of 2009 and 2010.

Page: 3
[5] Mr. Brown filed a notice of appeal under the General Procedure with the Tax Court of
Canada in relation to his 2006, 2007, 2008 and 2009 taxation years, and a notice of appeal under
the Informal Procedure with that Court in relation to his 2010 taxation year. In his notices of
appeal he included statements indicating that he was appealing the assessment of the gross
negligence penalties. The Crown brought motions to strike each notice of appeal on the basis that
Mr. Brown did not disclose any material facts. Both notices of appeal were struck by the Tax
Court.
Issues
[6] In the appeal to this Court Mr. Brown raises two issues:
(a) Whether, as a constitutional matter, the Act is null and void "due to vague and
convoluted interpretations in the [Act]"; and,
(b) Whether his appeal to the Tax Court of Canada should be allowed to continue only
in relation to the assessment of gross negligence penalties in 2009 and 2010.
Vagueness
[7] Mr. Brown's argument that the Act is void is based mainly on the definitions of
"business", "employee", "employment", "person" and "taxpayer" in subsection 248(1) of the
Act. These terms are defined in subsection 248(1) of the Act as follows:
"business" includes a profession, « entreprise » Sont compris parmi les

calling, trade, manufacture or entreprises les professions, metiers,
undertaking of any kind whatever and, commerces, industries ou activites de
except for the purposes of paragraph quelque genre que ce soit et, sauf pour
18(2)(c), section 54.2, subsection l'applieation de l'alinea 18(2)c), de
95(1) and paragraph 110.6(14)(f), an l'article 54.2, du paragraphe 95(1) et
adventure or concern in the nature of de l'alinea 110.6(14)f), les projets
trade but does not include an office or comportant un risque ou les affaires de
employment; caractere commercial, a 1'exclusion
toutefois d'une charge ou d'un emptoi.
"employee" includes officer; « employe » Sont compris parmi les

employes les cadres ou fonctionnaires.
"employment" means the position of « emploi » Poste qu'occupe un

an individual in the service of some particulier, au service d'une autre
other person (including Her Majesty personne (y compris Sa Majeste ou un
or a foreign state or sovereign) and Etat ou souverain etrangers); «
"servant" or "employee" means a prepose » ou « employe » s'entend de
person holding such a position; la personne occupant un tel poste.
"person", or any word or expression « personne » Sont comprises parmi les

descriptive of a person, includes any personnes tant les societes que les
corporation, and any entity exempt, entites exonerees de l'impot prevu a la
because of subsection 149(1), from tax partie I sur tout ou partie de leur
under Part I on all or part of the revenu imposable par l'effet du
entity's taxable income and the heirs, paragraphe 149(1), ainsi que les
executors, liquidators of a succession, heritiers, liquidate urs de succession,
administrators or other legal executeurs testamentaires,
representatives of such a person, administrate urs ou autres representants
according to the law of that part of legaux d'une personne, selon la loi de
Canada to which the context extends; la partie du Canada visee par le
contexte. La notion est visee dans des
formulations generates,
impersonnelles ou comportant des
pronoms ou adjectifs indefinis.
"taxpayer" includes any person « contribuab les » Sont comprises

whether or not liable to pay tax; parmi les contribuab les toutes les
personnes, meme si elles ne sont pas
tenues de payer l'impot.
[8] His argument is that the definitions provided for "business", "employee", "person" and
"taxpayer" are not complete definitions because the Act only provides specific references to
what is included in these terms. As a result, he submits that these expressions are vague.
Page: 5
[9] However, this is simply the choice of Parliament in determining what guidance will be
provided in the interpretation of these terms by ensuring that these terms will include what is
specifically referenced. Even if no guidance would have been provided by Parliament, each of
these terms would have a meaning that could be determined by a court for the purposes of the
Act. By providing that these terms "include" what is specifically identified in these definitions, it
does not make these provisions void, nor does it make the entire Act void.
[10] Lord Denning in Fawcett Properties Ltd. v. Buckingham County Council, [1961] A.C.
636 at 676 stated that:
My Lords, it is a bold suggestion to make that these words, taken as they are from
a statute, are void for uncertainty. Mr. Megarry was unable to point to any case
where a statute has ever been held void for uncertainty. There are a few cases
where a statute has been held void because it is meaningless but none because it is
uncertain ... But when a statute has some meaning, even though it is obscure, or
several meanings, even though there is little to choose between them, the courts
have to say what meaning the statute is to bear, rather than reject it as a nullity. As
Farwell J. put it when speaking of a statute: 'Unless the words were so absolutely
senseless that I could do nothing at all with them, I should be bound to find some
meaning, and not declare them void for uncertainty.'
[11] In R v. Nova Scotia Pharmaceutical Society, [1992] 2 S.C.R. 606, [1992] S.C J. No. 67,
Gonthier J. set out the following proposition:
71 The doctrine of vagueness can therefore be summed up in this proposition:

a law will be found unconstitutionally vague if it so lacks in precision as not to
give sufficient guidance for legal debate. This statement of the doctrine best
conforms to the dictates of the rule of law in the modern State, and it reflects the
prevailing argumentative, adversarial framework for the administration ofjustice.
[12] The provisions of the Act to which Mr. Brown refers do not satisfy this proposition.
Whether the defined terms will include, in additbn to what is specifically identified, something
Page: 6
or someone else is a matter that can be resolved by a Court based on the ordinary meaning of
these terms.
[13] For example, in this case, Mr. Brown raised the question of whether he was a person for
the purposes of the Act since the definition of person only provides that it includes corporations,
certain entities "and the heirs, executors, liquidators of a succession, administrators or other legal
representatives of such a person". Human beings or individuals are not specifically included in
the list.
[14] However, in Canada (Minister of National Revenue) v. Stanchfield, [2009] F.C.J. No.
133, 2009 FC 99, Gauthier J. (as she then was) stated:
23 When one uses simply the term "person", one necessarily includes the
notion of the human being, as it is the very essence of the reality represented by
this term. This explains why, in the Act, subsectbn 248(1) does not specifically
mention the term "human being" in its definition of the term "person". This is not
necessary given that, as explained by professors Duff, Alarie, Brooks and Philipps
in Canadian Income Tax Law\ "this definition merely expands on the ordinary
meaning of the word "person"" (emphasis added). This is entirely consistent with
the approach of the British Columbia Court of Appeal in Lindsay (see above at
para. 10). There is thus absolutely no doubt that a natural person is directly
included within the definition of the word "person" at subsection 248(1) of the
Act.
[15] Mr. Brown is a person and a taxpayer for the purposes of the Act.
Standard of Review - Motion to Strike Pleadings
[16] The second issue raised by Mr. Brown is whether the provisions of his notices ofappeal
related to the assessment of gross negligence penalties should have been struck. In Canadian
Page: 7
Imperial Bank of Commerce v. The Queen, 2013 FCA 122, [2013] 4 C.T.C. 218, this Court noted
that:
5 The decision of a judge to grant or refuse a motion to strike is

discretionary. This Court will defer to such a decision on appeal in the absence of
an error of law, a misapprehension of the facts, a failure to give appropriate
weight to all relevant factors, or an obvbus injustice: Apotex Inc. v. Canada SZ03
(Governor in Council), 2007 FCA 374, Collins v. Canada, 2011 FCA 140. o
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[17] Iacobucci, J., writing on behalf of the Supreme Court of Canada in Odhavjiv.
Woodhouse, 2003 SCC 69, [2003] 3 S.C.R. 263, set out the test for striking pleadings:
15 An excellent statement of the test for striking out a claim under such
provisions is that set out by Wilson J. in Hunt v. Carey Canada Inc., [1990] 2
S.C.R. 959, at p. 980:
... assuming that the facts as stated in the statement of claim can be
proved, is it "plain and obvious" that the plaintiffs statement of
claim discloses no reasonable cause of action? As in England, if
there is a chance that the plaintiff might succeed, then the plaintiff
should not be "driven from the judgment seat". Neither the length
and complexity of the issues, the novelty of the cause of action, nor
the potential for the defendant to present a strong defence should
4. a. — ^
pL^/VClll UIV^ piUlllllXl ULV/111 piuvyvvuuig Willi 1IUJ KJL 11VI VUJV. W IXIJ 11
the actbn is certain to fail because it contains a radical defect ...

should the relevant portions of a plaintiffs statement of claim be
struck out ...
The test is a stringent one. The facts are to be taken as pleaded. When so taken,
the question that must then be determined is whether there it is "plain and
obvbus" that the actbn must fail. It is only if the statement of claim is certain to
fail because it contains a "radical defect" that the plaintiff should be driven from
the judgment. See also Attorney General of Canada v. Inuit Tapir isat of Canada,
[1980] 2 S.C.R. 735.
Pleadings in Relation to Gross Negligence Penalties

[18] Mr. Brown confirmed during the hearing of his appeal before this Court that the only
matter that he wants to pursue before the Tax Court of Canada is the assessment of the gross
negligence penalties for 2009 and 2010. He is not pursuing his appeal in relation to the denial of
the losses from a business in 2009 or 2010 or the denial of the cany back of a noncapital loss to
2008, 2007 or 2006.
[19] Subsection 163(3) of the Act provides that:
(3) Where, in an appeal under this Act, (3) Dans tout appel interjete, en vertu
a penalty assessed by the Minister de la presente loi, au sujet d'une
under this section or section 163.2 is penalite imposee par le ministre en
in issue, the burden of establishing the vertu du present article ou de l'article
facts justifying the assessment of the 163.2, le ministre a la charge d'etablir
penalty is on the Minister. les faits qui justifient 1'imposition de
la penalite.
[20] Therefore the Minister, and not Mr. Brown, would have the burden of establishing the
facts justifying the assessment of the gross negligence penalties imposed for 2009 and 2010.
Since the only documents filed in these matters at the Tax Court of Canada were the notices of
appeal (and amended notices of appeal) filed by Mr. Brown, it is not plain and obvious that the
Minister will be successful in establishing the facts justifying the assessment of the gross
negligence penalties. Since this is the Minister's burden, there are no material facts that Mr.
Brown would need to allege (and then have the onus to prove) in his notices of appeal.
[21] The Tax Court erred in law in striking those parts of Mr. Brown's notices of appeal that
address the issue of whether gross negligence penalties should have been assessed. Striking these
parts of the notices of appeal means that he is denied a hearing in the Tax Court of Canada on a
matter for which the onus of proof rests with the Minister.
Page: 9
Conclusion
[22] As a result, I would allow Mr. Brown's appeal in relation to striking the parts of his
notices of appeal that address the assessment of gross negligence penalties for 2009 and 2010.
The parts of his notices of appeal for 2009 and 2010 that relate to the loss from a business that he
had claimed in these years would be struck and the parts of his notices of appeal for 2009 and
2010 that relate to the assessment of these penalties would not be struck. The provisions of his
notice ofappeal that relates to his appeal of the assessment of his 2006, 2007 and 2008 taxation
years would be struck, as no penalties were assessed in relation to those years. Therefore, making
the order that the Tax Court should have made, I would revise Mr. Brown's notices of appeal as
follows:
Tax Court File Number 2012-3456(TT)G (Appeal A-340-13) - Mr. Brown's Amended
Notice of Appeal dated November 26, 2012 (Appeal Book pages 35 to 38):
Paragraphs (a) ana (b) conxain personai information. These paragraphs, as wriueri by
Mr. Brown, would not be struck from this notice of appeal except that the reference to
taxation years 2006, 2007, 2008 and 2009 would be changed to a reference to only the
taxation year 2009.
Paragraphs 1) to 4) (inclusive) and paragraph 9) relate to either Mr. Brown's right to
appeal to the Tax Court of Canada or the assessment of the gross negligence penalty and
would not be struck from this notice of appeal

Page: 10
Paragraphs 30) and 31) indicate that the issue is "[w]hat constitutes a false statement"
and "[w]hether the penalty imposed by the minister is supported by any facts" and
would not be struck from this notice of appeal.
Paragraphs 33, 34, 35, 37 and 39 relate to either Mr. Brown's right to appeal to the Tax
Court of Canada or the assessment of the gross negligence penalty and would not be
struck from this notice of appeal.
The parts of the paragraph outlining the relief sought (identified as (g)) related to
vacating the assessment, "vary[ing] the account to reflect the return which was
originally filed" and granting other relief would be struck. As a result this paragraph
would be as follows:
The appellant is requesting that the court remove all penalties imposed on this
account and all accrued interest on those penalties.
All of the other paragraphs of this notice of appeal would be struck.
Tax Court File Number 2013-3386(IT)I (Appeal A-120-14) - Mr. Brown's Fresh Notice
of Appeal dated January 20, 2012 (Appeal Book pages 82 and 83):
Page: 11
This notice ofappeal, in relation to his 2010 taxation year, would be as submitted by
Mr. Brown except that the reference in paragraph 4 to his request that the court vacate
the assessment would be struck and therefore this paragraph would be as follows:
03C
4. The Appellant is requesting that the court remove all penalties imposed on this O
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[23] I would set aside the awards of costs that were made by each Tax Court Judge and I
would award Mr. Brown costs here and below.
"Wyman W. Webb"
J.A.
"I agree
J.D. Denis Pelletier J.A."
"I agree
David Stratas J.A."

Venne v. R., 1984 CarsweliNat 210, [1984] C.T.C. 223, 84 D.T.C. 6247 (Federal Court—Trial Division)
Venne v. R.
Lucien Venne, Plaintiff, and Her Majesty The Queen, Defendant
Citation: 1984 CarsweliNat 210, [1984] C.T.C. 223, 84 D.T.C. 6247

Federal Court—Trial Division
Strayer, J
Judgment: April 9,1984
Year: 1984
Docket: Court No T-815-82
Proceedings: on appeal from assessments of the Minister of National Revenue
Counsel: Lorenzo Girones for the plaintiff.

Robert McMechan for the defendant.
Subject:
Income Tax (Federal)
Strayer, J:
IThis is an action by way of an appeal under subsection 172(2) of the Income Tax Act. It is an appeal from notices of
reassessment by Revenue Canada of the plaintiffs income for the taxation years 1972, 1973, 1974, 1975, 1976, 1977, and
1978. The notices were dated September 3, 1980. Each of them reassessed income at a higher figure, and levied taxes on
such unreported income together with interest on that tax, plus a penalty under subsection 163(2) of the Income Tax Act for
"false statements" (as defined in that subsection) in the taxpayer's income tax returns for the years in question. In the notice
of reassessment for the taxation year 1972 there was also a late filing penalty of $ . That penalty is not contested herein.
Issues
2(1) Power to reassessfor more thanfour years—I shall refer to this issue first since its resolution will determine whether
some of the particular items of income in dispute will require consideration. Subsection 152(4) of the Income Tax Act
provides:
(4) The Minister may at any time assess tax, interest or penalties under this Part or notify in writing
any person by whom a return of income for a taxation year has been filed that no tax is payable for the
taxation year, and may
(a) at any time, if the taxpayer or person filing the return
(i) has made any misrepresentation that is attributable to neglect, carelessness or

wilful default or has committed any fraud in filing the return or in supplying any
information under this Act, or
(ii) has filed with the Minister a waiver in prescribed form within 4 years from the
day of mailing of a notice of an original assessment or of a notification that no tax is
payable for a taxation year, and
(b) within 4 years from the day referred to in subparagraph (a)(ii), in any other case.
reassess or make additional assessments, or assess tax, interest or penalties under this Part, as the
circumstances require.
Subparagraph (4)(a)(i) is relevant to the present case: it means that in order to reassess for more than four years counted
backwards from the date of reassessment (in this case September 3, 1980) it was necessary for the Minister to show that
there has been "misrepresentation that is attributable to neglect, carelessness or wilful default" or "fraud" by the taxpayer
in filing the return or in supplying information under the Act. It appeared to be common ground in this case that for the
notices of reassessment to be effective for taxation years 1972, 1973, 1974, and 1975, it is necessary for the Minister to prove
misrepresentation or fraud.
3(2) Exclusion of certain income from such extended reassessment—Subsection 152(5) of the Income Tax Act provides in
part:
(5) Notwithstanding subsection (4), there shall not be included in computing the income of a taxpayer, for
the purpose of any reassessment, additional assessment or assessment of tax, interest or penalties under
this Part that is made after the expiration of 4 years from the day referred to in subparagraph (4)(a)(ii),
any amount
(b) in respect of which the taxpayer establishes that the failure so to include it did not result
from any misrepresentation that is attributable to negligence, carelessness or wilful default or
from any fraud in filing a return of his income or supplying any information under this Act, and
This means that if the taxpayer can prove (and he has the burden of proof here) with respect to any year or years more than
four years prior to the reassessment where the original assessment has been reopened by virtue of subsection 152(4), that his
failure to include any particular item of income was not due to negligence, carelessness, or wilful default or fraud, then such
items should not be included in the reassessed income. While there was some discussion of this subsection during the case,
I understand the plaintiffs position to be that he is not asserting that any particular item of income during the years 1972-75
should be exempted from inclusion in the reassessment for this reason. He relies on his position, instead, that the defendant
has not met the burden of proof required by subsection 152(4) and therefore no item of income during this period can be
reassessed. I will therefore not deal further with subsection 152(5).
4(3) Amount of unreported income—After some months and years of discussion between Revenue Canada and the taxpayer's
representatives, the difference between them has been considerably narrowed with respect to the amount of income which
the taxpayer failed to report dnring the six-year period 1972—77. The defendant savs that amount is $ . The plaintiff
has admitted that $ of income was unreported. For 1978 the defendant reassessed the plaintiffs income by adding
$ which is also challenged by the plaintiff. The issue here, apart from the question of whether any reassessment
could be made in 1980 with respect to any period more than four years prior to the reassessment (see (1) above), is whether
I consider that the plaintiff has met the burden of proof placed on him to overcome the presumption that normally applies as
to the correctness of the Minister's reassessments. This will require examination of each of the items in question in relation to
the evidence.
5(4) Imposition of penalties—In 1978, subsection 163(2) of the Income Tax A ct provided:
(2) Every person who, knowingly, or under circumstances amounting to gross negligence in the carrying
out of any duty or obligation imposed by or under this Act, has made, or has participated in, assented to
or acquiesced in the making of, a statement or omission (in this section referred to as a "false statement")
in a return, certificate, statement or answer (in this section referred to as a "return") filed or made in
respect of a taxation year as required by or under this Act or a regulation, is liable to a penalty of 25% of
the amount, if any, by which
(a) the tax for the year that would be payable by him under this Act if his taxable income for
the year were computed by adding to the taxable income reported by him in his return for the
Taxnet Pro™ © 2016 Thomson Reuters Canada Limited.

year that portion of his understatement of income for the year that is reasonably attributable to
the false statement
exceeds
(b) the tax for the year that would have been payable by him under this Act had his tax payable
for the year been assessed on the basis of the information provided in his return for the year.
This subsection was amended both before and after this date, but the essential language remained the same for the purposes
of this case.
6These provisions mean that the 25 per cent penalty can only be applied if it is shown that the taxpayer "knowingly, or under
circumstances amounting to gross negligence" has made a "false statement" in a return or has somehow participated or
acquiesced in the making of that statement. By virtue of subsection 163(3) "the burden of establishing the facts justifying the
assessment of the penalty is on the Minister". It will be noted that for the penalty to be applicable there appears to be a higher
degree of culpability required, involving either actual knowledge or gross negligence, than is the case under subsection
152(4) for reopening assessments more than four years old where mere negligence seems to be sufficient. The jurisprudence
under these subsections will be examined more fully later. It may be noted at this point that, as I understand it, the parties are
in agreement that the amounts which would be subject to penalties, if subsection 163(2) is applicable, for the years 1972-78
inclusive would be $ . The particulars year by year are set out in Exhibit D-54.
7(5) Partnership—The taxpayer contends that during the years 1972-78 the income attributed to him was in fact the income
of a partnership between himself and his wife so that the income should be equally attributable to his wife.
Background
8The taxpayer, Lucien Veime was 49 years old at the time of the trial, having been born in Timmins. He grew up speaking
French at home and learned English from his friends. He went to school for eight years and completed grade 5. The school
used French as the language of instruction. He says that he can read and write both English and French and not very well in
either case. He left school at fourteen and went to work in garages. In 1962 he went into a garage business with his brother
Roger. There he says Roger looked after the business affairs and he was involved with the mechanical and service end of the
business. In 1967 he sold his share to Roger for $ .
9It is appropriate to note at this point that Lucien Venne was married in 1955. He and his wife Grace both testified that
prior to marriage they had each developed the habit of keeping their savings in cash at home. At the time of their marriage
they pooled their financial resources, some $ in cash, which they kept at home. They continued to add to it through
savings which they accumu lated at the rate of about $ a year. In 1965 Mr Venne bought a second-hand safe of sizable
proportions—some four feet high and two feet wide—in which they thereafter kept the cash they had at home. When Mr
Venne received a cheque for $ with respect to the sale of his share of the business to his brother in 1967, he cashed the
cheque and also put this money in the safe at home. There was much other evidence of the comings and goings of cash in and
out of this safe but save for one or two further incidents I need not go into these details.
lOWhen he sold his share of the garage business to his brother, Mr Venne then leased a service station from Shell Oil.
In 1968 he bought the building adjacent to the Shell station, paying $ for it. He and his wife sold their house on
Bannerman Street and moved into the upstairs apartment in that building, using the lower floors for the business. From these
modest beginnings in 1967-68 Mr Venne developed a very successful business known as the Shell Clinic and Luke's Sports
and Marine. It had substantial gross sales, reaching as high as $ in 1975. Through much of this period the Vennes
lived on the business premises and Mrs Venne often assisted in the business. In particular she balanced the cash at the end
of each day and made bank deposits. The service station was operated seven days per week. In early 1976 Mr Venne sold
this business for $ plus the value of the inventory. Thereafter he opened another business of his own which was
incorporated in 1978 as Luke Venne Enterprises Limited. It is apparently a wholesale marine and snowmobile business. This
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Venne v. R„ 1984 CarsweliNat 210, [1984] C.T.C. 223, 84 D.T.C. 6247 (Federal Court—Trial Division)
a
business was started on property on McBride Street bought by the Vermes in 1973 as a home, at which time they had moved
out of the business building on Algonquin Street and rented out the apartment there.
11During the period in question, from 1971 to at least 1977 (the period covered by the "net worth" statement prepared by the
defendant and not, in this respect, disputed by the plaintiff) the other important source of income for Mr Venne apart from
his business was mortgage interest. Starting with the remnants of a mortgage which they had taken in 1968 when they sold
their house on Bannerman Street, he had by 1977 over $ in mortgages. The largest part of this latter figure apparently
came from moneys received on the sale of the business in 1976. Failure to declare large amounts of interest from some of
these mortgages as income was one of the major factors in the reassessments by the defendant.
12Also of interest is the succession of bookkeepers or accountants whom Mr Venne employed over the years in question.
It appears that at the time of the commencement of operation of the Shell station and of the Sports and Marine business on
Algonquin Street a Mr St-Jacques was employed as a bookkeeper. He set up for Mr Venne a system of recording sales and
inventory which Mr Venne continued to employ through at least two successive bookkeepers, Mr Kelly and Mr Barnes.
Mr Kelley, who succeeded Mr St-Jacques, indicated by 1972 that to carry on with Mr Venne's bookkeeping he would have
to double his fee. At that point Mr Venne instead hired Mr Barnes, also a bookkeeper. Mr Venne insists that this was not
done to save money as he never even inquired from Mr Barnes how much he would charge. In 1978, some time after it
became known to Mr Venne that Mr Barnes was himself the object of legal proceedings with respect to income tax, Mr
Venne switched to a chartered accountant, Mr Charette, to look after his accounting. In 1979 he engaged a different chartered
accountant, Mr Dobson, whose firm of Dobson and Reid subsequently undertook extensive work to produce proper financial
statements for the years in question and to represent Mr Venne's interest vis-a-vis the Department of National Revenue which
was by this time conducting an investigation with respect to Mr Venne's income tax.
13It appears that a relatively simple method of record-keeping was used at the service station and marine business which Mr
Venne operated from 1967 to 1976. All sales, cash or charge, were punched into a cash register. There were sales receipts
covering items sold and work orders with respect to service work done at the service statement. Major bills were paid
by cheque, or in the case of payment for deliveries of gasoline supplies, through use of credits based on gasoline bought
by customers with credit cards. Some small expenses were paid in cash. At the end of each month usually Mr Venne, or
sometimes Mrs Venne, would take the copies of all receipts, work orders, cash register tapes, and cheque stubs for the
month to the bookkeeper who was, during the years in question here, Mr Barnes. At the end of the year the Vennes would
take inventory and also provide that information to Mr Barnes. According to Mr Venne, Mr Barnes would then prepare the
income tax return which Mr Venne would in due course sign.
14Central to Mr Venne's position now is the proposition that he was not personally responsible for the many errors
committed by Mr Barnes in the completion of these income tax returns. Mr Venne testified that he found it almost impossible
to understand income tax returns, that successive bookkeepers tried to explain these matters to him but he found them almost
entirely incomprehensible. He insisted that he signed the forms without verifying the information in them or indeed without
understanding its purport. He even testified that he had not noticed until the trial that, because of the wording of the income
tax form, when he signed such a form he was thereby certifying the truth of the information in the form. Counsel for the
plaintiff also sought to introduce evidence to demonstrate Mr Barnes' general incompetence although I refused to admit most
of this evidence. It was in my view essentially opinion evidence being proffered by a witness who was not, because of a
failure by the plaintiff to comply with rule 482, entitled to testify as an expert.
Conclusions
15(1) Power to reassessfor more thanfour years—I have concluded that the plaintiff here has made misrepresentations
attributable to neglect or carelessness and therefore it is open to the Minister to reassess his tax for the taxation years 1972,
1973, 1974, and 1975.
161 am satisfied that it is sufficient for the Minister, in order to invoke the power under subparagraph 152(4)(a)(i) of the
Act to show that, with respect to any one or more aspects of his income tax return for a given year, a taxpayer has been
4
Venne v. R„ 1984 CarsweliNat 210, [1984] C.T.C. 223, 84 D.T.C. 6247 (Federal Court—Trial Division)
negligent. Such negligence is established if it is shown that the taxpayer has not exercised reasonable care. This is surely
what the words "misrepresentation that is attributable to neglect" must mean, particularly when combined with other grounds
such as "carelessness" or "wilful default" which refer to a higher degree of negligence or to intentional misconduct. Unless
these words are superfluous in the section, which I am not able to assume, the term "neglect" involves a lesser standard of
deficiency akin to that used in other fields of law such as the law of tort. See Jet Metals Products Limited v Minister of
National Revenue, [1979] C.T.C. 2738, 79 D.T.C. 624 at 2755 [636-37].
17The plaintiff devoted a good deal of effort during the trial to demonstrating that his bookkeeper during these years, Mr
Barnes, was grossly negligent or incompetent or both. To be sure, there is ample evidence to suggest that Mr Barnes did not
do an adequate job of preparing the plaintiffs tax returns. In some cases this worked against the interests of the taxpayer and
cannot be assumed to have reflected his true wishes. Further, I am satisfied from the evidence that many of the subtleties of
income tax law and of accounting were beyond the understanding of the taxpayer.
18Nevertheless, there are two salient forms of evidence which have convinced me that the taxpayer did not exercise
reasonable care in the completion and filing of his income tax returns and that this negligence resulted in misrepresentations
being made in the returns.
19First, there is ample evidence that the taxpayer did not read his returns before signing them. He admitted this on several
occasions: see the examination for discovery of the plaintiff, questions 124, 420, 608, 740, and 859. There was also a specific
admission by him with respect to one of the years in question, 1973, that he had not read the return: see examination for
discovery of the plaintiff, question 420. While one cannot expect a person with the plaintiffs limited education and limited
experience with accounting matters to understand fully the details of a tax return, in my view he cannot absolve himself
from all responsibility by hiring what he now says to be a patently inadequate bookkeeper and leaving matters entirely in
the latter's hands. See for example Howell v Minister of National Revenue, [1981] C.T.C. 2241, 81 D.T.C. 230 at 2243-44
[233]. Secondly, the errors in the income tax returns should have been sufficiently obvious that a reasonable man of even
limited education and experience, especially one who was apparently a very successful businessman and investor, should
have noticed.
20This conclusion is based partly on the magnitude of the unreported income during the years 1972-1975. In 1972 the
plaintiff reported income of $ . He now admits that there was further unreported income in that year of $ (see
Exhibit D-44). The Minister estimates the amount of unreported income in 1972 to be $ , and I accept the evidence
of Mr Panella, special investigator for the Department of National Revenue, on this point (see Exhibit D-50 and transcript
pages 34-36). For the taxation year 1973 the total income reported by the taxpayer was $ . He now admits that there
was further unreported income in the amount of for that year. The Minister has estimated the unreported income
of the taxpayer that year to have been an even further $ for a total unreported income of $ .1need not decide
for this purpose whether I accept the Minister's figure. For the taxation year 1974, the total income reported by the taxpayer
was . He now admits that there was of income unreported. The Minister has assessed the unreported income
at $ which includes a sum of $ that will be referred to later (see transcript pages 39-43). In 1975, the taxpayer
reported income of $ . He now admits that there was further unreported income in the amount of $ . The Minister
essentially agrees with the latter figure although he estimates the amount as being $ more, namely $ .1 think it is
apparent from the order of magnitude of these amounts of unreported income, even (with the exception of 1974) as estimated
by the taxpayer, that a reasonable taxpayer would have suspected that there was something deficient in the income tax returns
which he was signing during this period.
21 As for 1974, there was at least one example of a flagrant oversight which would have been perceived by a moderately
competent businessman who by this time had learned of the profitability of lending money on mortgages. It appears that
during 1974 he had earned interest of $ on a mortgage he held from a Robert Fournier. The plaintiff admitted that
none of this amount was shown on his income tax return (see examination for discovery of plaintiff, question 427) although
his attention could readily have been drawn to the fact that interest was taxable by the entry in his income tax return of an
amount of "interest in investment income" of which apparently reflected amounts of interest shown on T-5 slips with
respect to other interest earnings.
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22Further, the plaintiff should have been led to question the modest income which he was reporting having regard to the
steady growth in his bank accounts. From the end of 1971 to the end of 1972, his cash in bank grew from $ to $ ,
while his total income reported for 1972 was $ At the end of 1973 his cash in bank had grown of $ , while his
reported income for 1973 was $ . By the end of 1974 his cash in bank had grown to while he reported income
that year of $ . At the end of 1975 his cash in bank had grown to $ while he reported income that year of
$ . Assuming that throughout this period he was spending several thousand dollars at least for the living expenses
of himself and his family these sizable net accretions in his bank accounts should have at least led him to question his
bookkeeper.
23It is admitted by the plaintiff (see Exhibit D-44) that there were these substantial misrepresentations of income during
the years 1972-1975 and indeed thereafter in 1976 and 1977.1 am satisfied that these misrepresentations were attributable
to neglect on the part of the plaintiff within the meaning of subparagraph 152(4)(a)(i) of the Income Tax Act because the
plaintiff did not make any effort to question and supervise aspects of his income tax returns which he was clearly able to do.
He ignored the deficiencies in those returns which would have been obvious to him had he made a serious effort to ensure
their accuracy. I therefore find that it was open to the Minister by his reassessment of September 3, 1980, to reassess the
plaintiffs income tax for the years 1972-1975.
24(2) Exclusion of certain incomefrom such extended reassessment—As noted earlier, the plaintiff did not seek to rely on
paragraph 152(5)(b) of the Income Tax Act in order to show that the failure to report any particular item of income or to
report it accurately during 1972-75 occurred without negligence, etc, and since I have found against him on that question and
no case has been made for the exclusion of any particular item of income under paragraph 152(5)(b) the Minister can assess
tax on all unreported items of income including those unreported in taxation years 1972-1975.
25(3) Amount of unreported income—Having concluded that it is open to the Minister to assess additional income tax in all
of the years in question, there remain some items of income which are in dispute.
26For the years 1972-1977 the defendant says that the unreported income totals $ . The plaintiff admits that for that
period the unreported income was $ .1 will deal with the particular items where there is disagreement.
27For 1972, the defendant assessed the unreported income at $ , $ more than admitted by the plaintiff. The plaintiff
has not demonstrated, as is his responsibility, that the defendant is in error and I therefore accept the defendant's assessment.
28With recnert to 1Q7^ the plaintiff admits to $ in unreported income whereas the defendant says the correct figure
is $ . The difference of $ is based on the assumption that deposits totalling this amount which were made to the
plaintiffs bank account in July, 1973, by Mrs Venne represented income which was not otherwise reported. Copies of the
deposit slips were entered as Exhibit D-10. The plaintiff and his wife gave various explanations about the origins of this cash
but the common thread running throughout, which I accept, was that the money came from the safe which the plaintiff had
in his home. I believe that, from the evidence of Mr and Mrs Venne and their daughter Pat, it is sufficiently established that
there was a safe and that substantial amounts of cash were kept in it. The defendant tried to link somehow all of this money
with a gap which existed in the tapes of the business for July 24, 1973, suggesting that certain business income had been
deleted from the tapes in this manner. I was satisfied with the plaintiffs explanation of the gap in the tapes as being the result
of the repair and servicing of the machine. (See transcript pages 893—97). I am also satisfied that all or most of the $
in question with respect to 1973 had its origin in savings effected by Mr and Mrs Venne since their marriage in 1955. Both
Mr and Mrs Venne testified that they had a few thousand dollars in savings at the time of their marriage and that they had
put aside something in the order of one thousand dollars per year since that time, all of this money being kept in the safe at
home. While a further approximately $ resulted from the sale by the plaintiff to his brother of his share in Venne Auto
Sales (see Exhibit D-2), a similar amount would have been paid out in 1968 when the Vennes bought property adjacent to the
Shell Station and incorporated it in their business activities. It is consistent with the evidence and quite credible that a further
in cash remained in the safe in July, 1973 when Mrs Venne deposited the money in the bank, apparently in order
to enable them to write a cheque for the purchase of the property on McBride Street to which they moved that year. I think
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the plaintiff has therefore met the burden of proof in this respect and I therefore find that the plaintiffs 1973 income should
be reassessed on the basis of his own admission that there was unreported income in the amount of $ rather than the
$ previously assessed by the defendant.
29With respect to 1974, the plaintiff admits to unreported income of whereas the defendant has assessed the
unreported income as being $ . The higher assessment of the defendant is explained by the evidence of its witness, Mr
Panella, at 40-43 of the transcript. I accept the defendant's position that there should be an addition to the income of $
based on an error in the net worth with respect to the cost of land, and the reduction of $ based on an error of the net
worth concerning mortgages receivable. This leaves the amount of $ which was deposited in the plaintiffs account
on August 15, 1974 by Mrs Venne. (See Exhibit D-l 1). The defendant assumed that this represented income otherwise
unreported by the plaintiff. The plaintiff and his wife have explained that this money also came from the safe. Further they
say that the large quantity of cash that was in the safe which, according to them, was all intermingled regardless of source,
came in part from a sum of $ or $ given to the Vennes for safekeeping in November, 1972, by Mrs Venne's
mother, Mrs Cunningham. Mr Cunningham had died in October, 1972. He had died while in his sixties, having been retired
a number of years from his employment as a miner due to ill health. The Cunninghams lived in a rented one-bedroom house
in South Porcupine. They did not own a car and spent very little money, according to Mr Venne. According to the evidence
of Mr and Mrs Venne (see transcript 935-37, 1093-1105, 1175-82), Mrs Cunningham said that she and her husband had
kept this money in a trunk and that she was nervous about having it in the house after her husband had died. Knowing that .
the Vennes had a safe, Mrs Cunningham asked them to keep the money for her. Further, the Vennes said that they never
counted the money to be sure exactly how much had been given to them for safekeeping, nor did they keep it separate and
apart in the safe. They testified in effect that the money had been mixed with their own and used for a variety of purposes
including investing in mortgages from which Mr Venne collected the interest. When Mrs Cunningham died, in January,
1980, the money simply remained with the Vennes. There was no will and no letters of administration. Both the Vennes
indicated quite clearly that they had not divided the money with other members of the family, namely Mrs Venne's two
sisters and two brothers. Nor did they advise the other members of the family of the fact that they had this amount of money
in safekeeping for Mrs Cunningham although there was some suggestion that the brothers and sisters were aware that the
Vennes were keeping some money for her. I am unable to accept this account as the source of a sufficient amount of cash to
provide the $ deposited in the bank on August 15, 1974. In my view it defies credibility. First, it is quite improbable
that the Cunninghams who lived extremely modestly would have accumulated such a sum of money or would have kept it
in such a way as to forego earning any interest on it, even simple savings account interest. There was some evidence that
an unspecified portion of the money had come from an inheritance from Mrs Cunningham's uncle, although no details were
provided. But even if the Cunninghams had such money, which is not otherwise relevant to this case, I am unable to accept
that the money was turned over to the Vennes and handled by them on the terms which they described. First, it is incredible
that no one, neither Mrs Cunningham nor either of the Vennes ever counted the money which was being turned over to
them temporarily for safekeeping. This is particularly unlikely as the money was supposedly put in the safe without any
identification and without being kept separate from the money of the Vennes. It is also difficult to believe that during the
remaining eight years of her life Mrs Cunningham neither required any of this money nor did she apparently tell her other
children of the amount involved. Nor was any question raised by any member of the family after her death. It is particularly
hard to believe that the Vennes would not feel some obligation to share this knowledge, and perhaps some of the money,
with Mrs Venne's brothers and sisters after the death of Mrs Cunningham. It is also notable that when Mr Panella, the special
investigator from Revenue Canada, questioned Mr Venne in May, 1979 about sources of cash other than business no mention
was made of this alleged, not inconsiderable, sum of $ or $ . The explanation based on Mrs Cunningham as the
source was not offered until the time of the examination for discovery of the plaintiff in October, 1982. (See transcript 41-
43). There was no corroboration of the evidence of Mr and Mrs Venne on the existence of the Cunningham money or its
amount. The only evidence offered by the plaintiff in this respect was the testimony of his daughter Patricia Hamelin who
simply testified as to the existence of the safe and that she once saw cash in it. She could not specify when this happened.
She said she had never used the safe and she never counted the cash in it nor did she estimate how much cash was in it. On
cross-examination she agreed that in 1972 she would have been about 14 years old. This evidence was in no way helpful
to corroborate the source or quantity of the alleged Cunningham money. I therefore do not accept that this money was
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the source of unexplained infusions of cash such as the deposit by Mrs Venne on August 15, 1975 of $ .1therefore
confirm the assessment by the defendant of the plaintiffs income for 1974.
30With respect to 1975, the taxpayer admits that there was unreported income in the amount of $ . The defendant
says the correct amount is . According to Mr Panella this reflects a typographical error. This was not refuted by the
plaintiff and I therefore confirm the assessment made by the defendant for 1975.
31With respect to 1976 the plaintiff admitted unreported income of whereas the defendant assessed it at only
$ . The plaintiff, has, understan dably, not demonstrated an error in the defendant's assessment and I therefore accept
the latter.
32Similarly, with respect to 1977, the plaintiff admitted unreported income of $ whereas the defendant asserted that
the amount was only .1therefore confirm the assessment of the defendant.
33With respect to 1978 there was no admission by the plaintiff as to unreported income. In its notice of reassessment of
September 3, 1980 the defendant reassessed the plaintiffs income at an amount $ higher than that reported, of
which one item was unreported interest in the amount of . It appears now that the parties agree that this particular item
should instead be . (See Exhibits D-44, D-54; transcript 51,1069-70).The plaintiff has not otherwise demonstrated
any error in the defendant's reassessment and I therefore confirm the latter subject to the agreed reduction from $ to
with respect to unreported interest.
34(4) Imposition of penalties—As noted earlier, in order for the defendant to levy penalties under subsection 163(2) of the
Income Tax Act it is necessary that the taxpayer have "knowingly, or under circumstances amounting to gross negligence ...
participated in, assented to or acquiesced in the making of' a false statement in a return, etc. The similar language of
subsection 56(2) of the former Income Tax Act was interpreted by Cattanach, J in Udell v Minister of National Revenue,
[1969] C.T.C. 704, 70 D.T.C. 6019. In that case a farmer had retained a certified public accountant to prepare his income
tax returns. The accountant made several errors in different taxation years in the process of transposing figures from the
taxpayer's account books to his working papers. In some of the years in question the accountant signed the returns on behalf
of the taxpayer before they were seen by the later and in other years the taxpayer reviewed them first and then signed them.
He apparently did not notice any errors. The Minister of National Revenue assessed penalties with respect to these errors.
In interpreting the language now found in subsection 163(2) of the present Income Tax Act, Cattanach, J said, at 713-14
[6025-25]:
Arr.nrHinoly there remains the question of whether or not section 56(2) contemplates that the gross
negligence of the appellant's agent, the professional accountant, can be attributed to the appellant.
Each of the verbs in the language "participate in, assented to or acquiesced in" connotes an element of
knowledge on the part of the principal and that there must be concurrence of the principal's will to the act
or omission of his agent, or a tacit and silent concurrence therein. The other verb used in section 56(2) is
"has made". The question, therefore, is whether the ordinary principles of agency would apply, that is,
that what one does by an agent, one does by himself, and the principal is liable for the actions of his agent
purporting to act in the scope of his authority even though no express command or privity of the principal
be proved.
In my view the use of the verb "made" in the context in which it is used also involved a deliberate and
intentional consciousness on the part of the principal to the act done which on the facts of this case was
lacking in the appellant. He was not privy to the gross negligence of his accountant. This is most certainly
a reasonable interpretation.
I take it to be a clear rule of construction that in the imposition of a tax or a duty, and still more of a
penalty if there be any fair and reasonable doubt the statute is to be construed so as to give the party
sought to be charged the benefit of the doubt.
8
In coming to this interpretation the learned judge had regard to the fact that the subsection in question is a penal provision
and it must be interpreted restrictively so that if there is a reasonable interpretation which will avoid the penalty in a
particular case that construction should be adopted. He concluded that the erroneous information in the returns was not
included with the knowledge of the taxpayer nor could the gross negligence of the accountant be attributed to him.
35It is also important to keep in mind in applying this subsection that by subsection 163(3) the burden of proof is on the
defendant in justifying the assessment of a penalty.
361 have come to the conclusion that the defendant has not sufficiently proven that the misstatements were made
knowingly by the plaintiff in his tax returns for the years in question. I should note here, as it is relevant to the whole
question of the application of penalties under subsection 163(2), that there seems to be a certain element of subjectivity
recognized in the case law with respect to assessing the knowlege or gross negligence of a taxpayer with respect to
misstatements in his return: see, eg, Howell v. MNR, {supra), at 2245 [234]; Joris v Minister of National Revenue, [1981]
C.T.C. 2596, 81 D.T.C. 470 at 2598 [472]. The taxpayer here is a man with a grade five education, working and paying taxes
in a language which is not his first language nor that in which he was educated, a man who is more at ease in a garage than
in an office. Not only do these factors militate against a finding that the misstatements in his return were made knowingly by
him, but also his entire course of conduct is not consistent with that of a person who had deliberately set out to conceal large
amounts of taxable income. He kept what appear to be quite complete records of sales in his business, then turned these over
to his bookkeeper. As far as one can judge from the evidence, all or most of the revenues from the business were deposited
in the bank where the moneys could readily be traced. He also lodged all but one or two of the mortgages on which he lent
money with banks and trust companies which kept careful records of the income earned from these "escrow mortgages". It is
unlikely that a person planning to conceal income would have handled his affairs in this manner. Further it is hard to believe
that he was consciously and effectively supervising his bookkeepers since a number of the errors made in his returns were to
his disadvantage, even though more of them were to his advantage. I am therefore not able to conclude that the misstatements
in the returns were made "knowingly" by the plaintiff.
37With respect to the possibility of gross negligence, I have with some difficulty come to the conclusion that this has not
been established either. "Gross negligence" must be taken to involve greater neglect than simply a failure to use reasonable
care. It must involve a high degree of negligence tantamount to intentional acting, an indifference as to whether the law
is complied with or not. I do not find that high degree of negligence in connection with the misstatements of business
income. To be sure, the plaintiff did not exercise the care of a reasonable man and, as I have noted earlier, should have
at least reviewed his tax returns before signing them. A reasonable man in doing so, having regard to other information
available to him, would have been led to believe that something was amiss and would have pursued the matter further with
his bookkeeper.
38With respect to business income, I can more readily recognize that effective surveillance would have been difficult for
the plaintiff and would have involved him making and reviewing numerous computations of revenues, expenditures, assets,
and liabilities. In other words the errors in business income, small in some years but very substantial in others, would not
necessarily have "sprung out" at a person of the taxpayer's background and abilities. While it may have been naive for him
to trust his bookkeeper as knowing more about such matters than he did, I do not think it was gross negligence for him to
fail to challenge the bookkeeper with respect to the business computations. However egregious the errors committed by
the bookkeeper in this respect, it is quite conceivable that theyd were not in fact noticed by the plaintiff and his neglect
in not noticing them fell short of constituting gross negligence. For other examples of such a situation see MNR v Weeks,
[1972] C.T.C. 60, 72 D.T.C. 6001; Markv Minister of National Revenue, [1978] C.T.C. 2262, 78 D.T.C. 1205; Snelgrove
v Minister of National Revenue, [1979] C.T.C. 2938, 79 D.T.C. 780; Morgan et al v Minister of National Revenue, [1973]
C.T.C. 2192, 73 D.T.C. 146.
39With respect to most of the unreported interest income, however, I have more difficulty avoiding the conclusion that the
plaintiff was grossly negligent. His position is essentially that prior to 1976 (when very little interest income was earned),
he did not know that interest was taxable. Commencing with the 1976 taxation year, he became aware that it was but he
believed that the only portion of interest which was taxable was that which was included in a T-5 form. (See transcript
Taxnet Pro™ ©2016 Thomson Reuters Canada Limited 9

pages 955-56, 966, 980, 1002, 1003,1024, 1045). As mentioned above, most of the mortgages on which the plaintiff earned
interest were lodged with the Ontario Trust Company, the Bank of Nova Scotia, or the Canada Trust Company. In most of
the years in question these institutions issued T-5 slips to the plaintiff with respect to interest earned on his accounts in those
institutions but these slips did not include interest collected by them on his behalf on the escrow mortgages which they held
for him. At the same time however the plaintiff appears to have kept careful records at home concerning these mortgages,
recording each month the amount of principal and interest paid and the balance still owing. (See eg, Exhibits D-15, D-28
to 31). There was apparently further confusion caused in 1976 by the fact that after the sale of his business the plaintiff had
a certificate of deposit at the Bank of Nova Scotia on which over $ of interest was credited to him in 1976, but no
T-5 was issued by the bank for that. Although in that year the plaintiff declared interest and other investment income in
the amount of $ which included other sources of interest covered by T-5s in the amount of $ , it was not clear
whether the remaining $ declared by him was with respect to the interest from the certificate of deposit or to interest
from mortgages from which the plaintiff had also earned a somewhat similar amount. I can only conclude that the plaintiff
knew, or was readily able to ascertain, how much interest income he was earning year by year from mortgages and from
bank accounts, trust company accounts, certificates of deposit and like instruments. This was not a difficult concept and well
within the plaintiffs abilities which, the evidence demonstrates, easily included the addition of sums and the calculation
of interest. His explanation for not reporting all his interest income, however, is that he was not concerned about possible
discrepancies between the amount of interest he knew, or could ascertain, that he was earning, and the amount reported in
his income tax returns, because he thought the T-5 issued by the banks and trust companies was the governing instrument
indicating how much of the interest was taxable. That he might have reached such conclusion is not completely improbable
because taxpayers have long been confused by a complex system of taxation in which the taxable amount from certain
sources does not always correspond to the amount actually received.
40It is difficult to decide whether a mistake such as this is one of fact or of law. If his mistake was in thinking that the T-5s
from the banks and trust companies accurately recorded all interest income relevant to completion of his tax returns, perhaps
it could be seen as a mistake of fact. If his mistake was in thinking that interest from the "escrow mortgages" was not taxable,
this could more readily be seen as a mistake of law. I am not sure that it matters which kind of a mistake is involved. After
reviewing a number of previous decisions on subsection 163(2) or its predecessors I have been unable to find any clear
authority on whether a mistake of law is a defence to the application of penalties thereunder. I am inclined to think that it can
be, depending on the circumstances and the state of understanding of the taxpayer. One must keep in mind, as Cattanach, J
said in the Udell case, (supra), that this is a penal provision and it must be construed strictly. The subsection obviously does
not seek to impose absolute liability but instead only authorizes penalties where there is a high degree of blameworthiness
involving knowing or reckless misconduct. The section has in the past been applied subjectively to taxpayers, taking into
account their intelligence, education, experience, eic, and l beiieve mis implies iiiai. an lgnuiauuc uf ihc law wlncli ia not
unreasonable for the particular taxpayer in question and the particular circumstances may be acceptable as a defence to the
application of penalties. On this basis, and having regard to the fact that the onus is on the Minister to prove that the penalty
should be applied, I find the evidence ambiguous and therefore conclude that the penalty should not be applied even in
respect of the unreported income from interest.
411 have therefore reached the conclusion that penalties under subsection 163(2) may not be assessed on the unreported
amounts of income arising during the years 1972 to 1978 inclusively.
42(5) Partnership—In his pleadings the plaintiff claims that in the taxation years 1972 to 1978 income attributed to him was
in fact income earned by himself and his wife in partnership and thus the income was equally attributable to his wife. There is
no evidence to substantiate this allegation.
43During the years in question the plaintiff filed his income tax returns on the basis of a sole proprietorship and claimed his
wife as a dependant (see Exhibit D-45). Dealer leases and sales contracts, insurance certificates and an agreement with Shell
for business and property management, all connected with the business, were in the name of the plaintiff alone (see Exhibits
D-33 to D-41). The dissolution of the proprietorship of Luke's Sport and Marine was signed by him alone (Exhibit D-42).
The new business, Luke Venne Enterprises Limited was subsequently incorporated by him alone (see Exhibit D-44).
10
44The plaintiff stressed that the property at 181 Algonquin which was adjacent to the Shell Clinic and which was bought by
the Vennes in 1969 was registered in their joint names. He further contends that the value of the land and buildings which the
plaintiff sold in 1976 with the sale of the business represented $ of the $ sale price. Therefore interest earned
from the reinvested proceeds of the sale of the land and buildings should be attributed equally to Mr and Mrs Venne. The
evidence shows however that the building at 181 Algonquin was purchased with money received by the plaintiff from the
sale to his brother of his share of Venne Auto Sales (see transcript 1193). That partnership interest in Venne Auto Sales was
in his name alone (see Exhibit D-2). One can only assume that the premises at 181 Algonquin were put in the joint names of
husband and wife because it was to be their home as well as part of their place of business. Viewing the evidence as a whole
there is no substantial evidence of any partnership agreement between Mr and Mrs Venne. This is perhaps another example
of the plaintiffs limited understanding of business and taxation matters but, given the fact that there was never any suggestion
in the income tax returns of the existence of a partnership nor in any other documents where one might expect to see it,
I cannot find any basis on which to declare now that one half of the plaintiffs income was in fact the income of his wife.
While Mrs Venne said in her evidence that she considered herself to be a partner (see transcript 1192) it is clear from the
context that she was speaking of a partnership of husband and wife in which she contributed what she could—and it was very
considerable—to the success of the business. Rightly or wrongly, she had felt that to be her duty. She said they had never
discussed the division of profits between them. She obviously assumed that she would also benefit from whatever profits her
husband might make from the business and that she would contribute to it what she could. But there was no suggestion of any
formal division of that income.
451 therefore do not accept the plaintiffs allegation that a partnership existed in the sense that one half of the income should
now be ascribed to Mrs Venne.
46Considering that success has been divided in this case no costs will be awarded.
Kind of Docurncut o 2016 Thomson Reuters Canada Limited.
Taxnet Pro™ © 2016 Thomson Reuters Canada Limited.

Tab L
Russell’s
Motion to Strike
Speech

Motion to Strike Speech Version 3.4

Overview

1. It is agent for Crown’s Motion to Strike, and not my Appeal, that is scandalous, frivolous,
and an abuse of process. Agent for Crown claims my Amended Notice of Motion does not
disclose reasonable grounds for appeal. In this submission I will give a few concise examples
of why it does disclose reasonable grounds for appeal. My Amended Notice of Motion goes
into more detail, and my April 27, 2015 Notice of Objection representations to CRA
(Appendix E) is in even more detail, including spreadsheets analyzing over 20 CRA forms,
flowcharts unraveling the Income Tax Act (“ITA”), and internal CRA documents.
Submissions
2. Agent for Crown is focused on the phrase “natural person” in my private property contract1,
as many taxpayers have lost income tax cases used that phrase. But what I mean by “natural
person” in my situation is based on a critically different set of facts from all other seemingly
same cases. No parallel can be drawn. If it could, then by agent for Crown’s logic, Her
Majesty is also a tax evader, since Her Majesty is referred to as a natural person at paragraph
35 in the case of The Queen v. Canadian Broadcasting Corporation2 (see Book of
Authorities Tab #1):
35 …When Parliament names Her Majesty in a statute means Her Majesty, not in her
capacity as a natural person but in her capacity as a corporation sole, a persona ficta
(artificial person)
3. Agent for Crown states that I believe certain income is exempt from taxation3. That is
scandalous as I believe all my income is subject to taxation. My appeal is about how income
received not as an ITA “officer”4, as my private property, is subject to taxation, but the ITA
deems such amounts to be equal to zero when calculating my total income. This does not
prevent the ITA from taxing me as an ITA officer receiving public money for Canada, which I
did for certain activities, filed it on T1s for the relevant taxation years, and paid the income
tax.
4. Agent for Crown states that I did not report the private property income on T1 returns5. My
position is it is legally impossible to report income that I wish to stay as private property on
CRA’s T1 form. This representation will show the basic logic I used to arrive at this
conclusion.

1
Appellant’s Amended Notice of Appeal, Appendix B, Section B, para. 3.
2
The Queen v. The Canadian Broadcasting Corporation, [1957] O.J. No. 655
3
Respondent’s Written Representations, at para. 1.
4
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) the definition of “officer” is within the definition of “office”.
Respondent’s Written Representations, at para. 2(f).
5
Version 3.4 https://CanadaIncomeTaxIsLegal.is 1

5. Agent for Crown states that I failed to report taxable income6. That is false. CRA has not
charged me with tax evasion or false information on a return. First, my position does not
disagree with the ten wrong positions7 taken by what CRA labels as “tax protestors”. I
addressed all ten when I reported to CRA my private property income that I received that was
not for an ITA officer for Her Majesty’s office (Appendix E). If my position had disagreed
with even one of CRA’s ten “tax protestor” positions, I would not have appealed. Clearly,
just on this one crucial “smell test”, my appeal cannot be an abuse of process.
6. Another reason my position is not an abuse of process is I can explain why others in similar
positions (but with different facts) were charged with tax evasion and found guilty, including
Porisky8, the author of my private property contract at the centre of my Appeal. If my
situation had identical facts to these guilty verdict cases, I should have been charged with tax
evasion, but I was not. That shows the facts of my appeal are critically different from all
these seemingly similar cases, including all the case law that agent for Crown used in their
Motion. I will address each of them in detail later.
7. In addition to having a different set of facts, my position is not frivolous because I have
research that is not from any of the so-called “OPCA litigants” listed in the Meads9 divorce
case, but instead is deduced from CRA forms, the CRA website, and government books and
documents. All this was used to reverse engineer the ITA. I would not have to do this if the
ITA is easy to understand, but it is not. I know of four former CRA officers, including two in
Investigations, one in ITA interpretation, and one who wrote the former Taxation Operations
Manuals, and they all admitted that they do not understand how the ITA works. Even
Canada’s eminent tax guru, Vern Krishna said10 (see Appendix F),
Canadians must enjoy being taxed. Why else would we placidly tolerate a tax regime that is
so mind-numbingly complex, incomprehensible and expensive? Individuals who do not
have even the remotest understanding of tax law must, under threat of civil and criminal
sanctions, comply with the fiction that everyone is presumed to know the law.
The Income Tax Act is the largest and most complicated statute in Canadian law. The
sheer volume of legislation (expanded and amended annually), regulations, changing
administrative practices, new treaties and judicial decisions means that no single person can
ever expect to fully understand the entire tax law in one lifetime. In income tax law, we
are a long way from writing legislation that ordinary intelligent people can understand.

6
7
CRA Newsroom, http://www.cra-arc.gc.ca/nwsrm/lrts/2011/l111130-eng.html
8
R. v. Porisky and Gould, 2012 BCSC 657, http://canlii.ca/t/fppg9
9
Meads v. Meads, 2012 ABQB 571, Pages 15-150 and 162-185
10
Vern Krishna, “Greek Protest Over Tax Hikes Might Work”, National Post, Oct 13, 2010. From
Wikipedia: “Vern Krishna CM, QC, FRSC, is a Professor of Law at the University of Ottawa, and Of
[1]
Counsel at Tax Chambers LLP. He is the author of fourteen texts in tax, international tax, and business
law, as well as numerous articles and case comments. His writings are frequently cited by the Supreme
Court of Canada and the Tax Court of Canada. Professor Krishna has been active in both of his
professions – law and accounting. He has been a Bencher of the Law Society of Upper Canada since
[2]
1990 and served as its elected head (Treasurer) from 2001 to 2003. A Certified General Accountant, he
was elected President of the Certified General Accountants of Ontario in 1995. He was a Visiting Scholar
in International Tax at Harvard Law School from 1998 to 1999, and is a Commissioner of the Ontario
Securities Commission.

8. While my in-depth analysis that was filed with CRA used twenty CRA forms, I will give a
quick example of my position using just two: the T1 and the RC199E(13) Voluntary
Disclosure Form. My position does not disagree with what is taught in law and accounting
schools, nor does it disagree with any of CRA’s ten so-called “tax protestor” positions.
9. A T1 form and associated Schedules involves at least six laws: the Canada Pension Plan
(“CPP”), the Employment Insurance Act (“EIA”), the Excise Tax Act (“ETA”) for GST, two
ITAs (federal and provincial), and the Financial Administration Act (“FAA”), since page 4 of
the T1 says to pay the Receiver General (see Appendix G), and the FAA says, “Consolidated
Revenue Fund means the aggregate of all public moneys that are on deposit at the credit of
the Receiver General”. I will refer to them all as “the six laws”. The officer is defined in the
CPP11, EIA12, ITA13, and ETA for GST14 as the same officer15, and the dealings an individual
has as an officer is the common thread that weaves through all six laws, links them together,
and determines when one has to pay CPP or no CPP, EI or no EI, and GST or no GST.
10. To pick GST as one of these three to use as an example, if an individual is working for
someone else (ITA “employment”16 = the position of an individual as an officer; CPP
“employment”17 = includes the tenure (holding) of an office), no GST needs to be remitted as
the individual taxpayer is merely holding a position, so no goods and no service has been
created. In contrast, ITA “employed”18 (someone in his own business) is defined as
performing the duties of an office, so GST from the ETA must be charged as the officer is
performing duties and created a service.
11. My position also explains what happened when CRA confirmed their assessment on
September 25, 2015 (see Appendix H) and proposed that my income through my private
property contract is an ITA s.9(1) business source of income (ITA “employed”), so GST must
be charged as the officer is performing duties and so has created a service. As the six laws
are interlinked, the reverse is also true; accepting GST is assenting to receive income for the
CPP/ITA/ETA office. That is why in my private property contract I declined19 the ITA’s
deeming that I receive income as a CPP/ITA/ETA officer as Canada’s (or Her Majesty’s)
public money20, but as private property21. It is common knowledge that GST is Her Majesty’s
public money. Since the ETA (GST) office is the same office as the CPP/ITA office, it
follows that money received as a CPP/ITA/ETA officer, (and also source deductions for such
an office), is also Canada’s public money (Appendix E, CRA Tax Alert, Diagram 32).

11
CPP s.2(1) the definition of “officer” is within the definition of “office”.
12
EIA s.5(4)(g): insurable employment is the tenure of an office as defined in subsection 2(1) of the
Canada Pension Plan.
13
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) the definition of “officer” is within the definition of “office”.
14
Excise Tax Act, s.123(1)
15
Real Estate Council of Alberta v. M.N.R., 2011 TCC 5 (CanLII), http://canlii.ca/t/2f7p9: [21] “The
definition of “office” found in the 1948 Income Tax Act was nearly identical to the current one in the
Canada Pension Plan except it includes “the office of a lieutenant-governor”.
16
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) definition of “employment”
17
CPP, s.2(1) definition of “employment”. Note it is the same as the ITA definition of “employment”.
18
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) definition of “employed”
19
20
“Public money” is as defined by the Financial Administration Act, R.S.C., 1985, c. F-11
21
Appellant’s Amended Notice of Appeal, Appendix B, Section B, para. 6.

12. In my private property income tax filing to CRA in my Notice of Objection (Appendix E,
Chapters 18-21), I detailed how the individual’s type of dealings as an officer also acts as an
on-off switch not just for GST, but also as an on-off switch for CPP and EI. I explained it
again graphically using four sequential flowcharts (Appendix E, Diagrams 20-23). If the
odds of this officer playing a pivotal role for GST, as I have just shown, is correct, the odds
are even more so when I showed in my filing how this office and officer allows these six
laws to operate not only individually, but interlinked together, and which is why all six laws
interact together on one form, CRA’s T1. That is another reason why it is not my Appeal, but
rather agent for Crown’s Motion to Strike, is scandalous, frivolous, and an abuse of process.
13. Another simple example of the pivotal role of the CPP/ITA/ETA officer is the definition of
employee in the ITA22, “employee includes officer”. The Composition of Legislation23, as
used by the Department of Justice (see Book of Authorities Tab #2) says, “includes: to
retain the ordinary meaning of a word and add a meaning it does not normally have” or “to
settle doubt whether a word means a particular thing.” Therefore, an ITA “employee” is
either someone who works for someone else (the ordinary meaning of a word) or someone
who works as an officer (add a meaning it does not normally have). With the second
definition, an ITA “employee” only means an officer (to settle doubt whether a word means a
particular thing). The point is, whether one uses the Department of Justice’s first definition
or the second definition of “includes”, invariably one has to deal with the CPP/ITA/ETA
officer; it simply cannot be ignored.
14. Unlike similar cases, including the Stanchfield24 case used by agent for Crown in their
Motion to Strike, I have also reverse engineered how this federal officer is created, who
creates it, and how CRA identifies the office/officer on their forms. CRA has some
knowledge of how and who creates this office as they addressed it on their website as what I
call CRA Tax Protestor Position #5 (Appendix E, page 64). As no one has ever presented
this to court, my appeal is not an abuse of process.
15. I sought help from accountants and tax lawyers but I used a simple test to judge their
knowledge. I also discovered that CRA has used the acronym “SIN” since 200125 (Appendix
E, Forms 8-9) to identify two different legal capacities (as CPP/ITA/ETA officer and as ITA
“legal representative”26). The T1 uses the all-lower-case “social insurance number” to
identify the CPP/ETA/ITA office/officer, while CRA’s RC-199 E (13) form, which is for
making a voluntary disclosure, warns the taxpayer that, “the information I have disclosed to
the Canada Revenue Agency may result in enforcement action taken against me wherein an
assessment or reassessment may be issued, penalties or interest may be levied, or an
investigation and prosecution may be initiated”, uses the upper-and-lower case Social
Insurance Number (see Appendix K) to identify the individual as an ITA “legal
representative”. To be statistically certain I analyzed twenty different CRA forms; my
conclusions fit all these forms 100% (Appendix E, Spreadsheet Diagrams 12-13).

22
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) definition of “employee”
23
The Composition of Legislation, Driedger, 2nd Ed., 1976, The Department of Justice, Ottawa, page 46.
24
Canada (National Revenue) v. Stanchfield, 2009 FC 99 (CanLII), http://canlii.ca/t/22g7x
25
Compare the 2000 and 2001 T1 forms at: http://www.cra-arc.gc.ca/formspubs/t1gnrl/llyrs-eng.html
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) definition of “legal representative”
26

16. I also have an affidavit from a taxpayer who has never applied for a Social Insurance Number
(see Appendix H). Even though his officer, a corporation director, has a tax debt that is 5
years old, CRA has never initiated any collection action against him because he has never
assented to be liable. This corroborates my position that the acronym SIN represents two
legal capacities as CPP/ITA/ETA officer and as ITA “legal representative”.
17. The CRA website also has two different descriptions27 for the two SINs (both in Book of
Authorities Tab #3), so it is scandalous that one of these SINs (the all-lower-case “social
insurance number” identifying the office/officer) is not defined nor used in any of these six
laws, and that the two legal meanings for the acronym SIN is not taught in law or accounting
schools, as I have yet to find a single tax lawyer or tax accountant that knows this. I am
therefore not surprised that agent for Crown does not understand my position, and so am
fortunate to receive help with my pleadings from a former government tax lawyer who does
not think my position is without merit. This is yet another reason why the court needs to deny
agent for Crown’s Motion to Strike.
18. What is the significance of an office? Offices have long been regarded as a form of
property28, since the property belongs to the office and not to the individual while not as
that officer. The officer is normally allowed use of some office income for living expenses.
This has led to people illegally taking over, buying, or selling offices. England enacted a Sale
of Offices Act in 155129 to punish those who illegally took over offices to take all that office’s
income for themselves. The crime of simony30 is the buying or selling of a religious office.
Cardinal Rovere bought the papacy for himself in 1503 and became Pope Julius II. He is
most remembered because he was the patron of Michelangelo, and for the building of St.
Peter’s Basilica. After his death collecting money for St. Peter’s Basilica became one more
pretext for selling indulgences, but Martin Luther found out in 1517 that 50% of the money
being paid by the faithful for indulgences to rebuild St. Peter’s was going to the financial
house of Fugger because they had lent a large sum of money to Archbishop Albert of Mainz,
so that he could buy his high office from Pope Leo X. That led to Martin Luther starting the
Protestant movement31.
19. My point to all these fun historical facts is that income for any office is not my private
property but belongs to the office. The ITA deems individuals to be a CPP/ITA/ETA officer32.
The Composition of Legislation33, written for the Department of Justice (see Book of
Authorities Tab #2), defines “deem” as “Used to establish legal fictions. For a statutory
purpose it is often necessary to deem a thing to be something it is not.” Since “the office and

27
CRA, under Definitions for letter S: http://www.cra-arc.gc.ca/tx/bsnss/glssry/s-gn-eng.html and also
under http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/prsnl-nf/sin-nas/menu-eng.html
28
The Law of Restitution, Goff and Jones, 6th Ed., 2002, Chapter 29, “Usurpers of Offices”, p. 689
29
Sale of Offices Act, 1551, https://en.wikipedia.org/wiki/Sale_of_Offices_Act_1551
30
The Bible, Acts 8:18-24
31
These examples of simony are from Power and Greed: A Short History of the World, 2002, by Philippe
Gigantes, who was a history professor, university dean, assistant to Prime Minister Pierre Trudeau,
Director General of the Canadian Public Service, and a Canadian Senator for 15 years:
https://en.wikipedia.org/wiki/Philippe_Gigantès
32
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.6(3) and s.152(7)
33
The Composition of Legislation, Driedger, 2nd Ed., 1976, The Department of Justice, Ottawa

the officer are conceptually divisible but legally indivisible”34, the officer’s income belongs
to the office. The T1 says pay the Receiver General of Canada, who collects public money
for the Consolidated Revenue Fund. The point is being such an officer for the six laws also
converts35 the individual’s private property into public money that now belongs to Canada.
Such a shift in the title of the property gives Canada extremely powerful legal powers for
enforcement, collection, and recovery of Canada’s public money.
20. Corporations, which are artificial persons in law, can be either aggregate or sole. I have a
corporation aggregate, a limited company, DR. WILLIAM RUSSELL NATUROPATHIC
INC. I am an officer of my corporation as its director. As it is an artificial person, my limited
company is obviously a separate legal person from me as an individual.
21. In the Porisky tax evasion case the judge said that a corporation sole “applies to an office”36
(see Book of Authorities Tab #7). Both offices and officers37 are therefore also artificial
persons in law. As I am standing here in front of you reading this, I am obviously not an
artificial person, but the law allows me to represent artificial persons, whether as an officer
for my limited company as its director, or as an officer for the purposes of the six laws.
22. To corroborate my point, here in court the court sheriff, the agent38 for Crown, and the
judge39 are all acting in their capacity as court officers. HER MAJESTY THE QUEEN, as
Respondent, is in Canada legally only through her office of the Governor General of Canada,
since the Queen as an individual is physically in the United Kingdom. From the case of The
Queen v. Canada Broadcasting Corporation40 again (see Book of Authorities Tab #1):

35 It is important that at the outset we should understand the connotation of the words
"Her Majesty" in the Act. When Parliament names Her Majesty in a statute it means Her
Majesty, not in her capacity as a natural person but in her capacity as a corporation sole, a
persona ficta. In Salmond on Jurisprudence, 9th ed. at p. 444, the author refers to this
dual capacity as follows:--
He (the King) has a double capacity, being not only a natural person but a
body politic, that is to say, a corporation sole. The visible wearer of the
crown is merely the living representative and agent for the time being
of this invisible and underlying persona ficta, in whom by our law the
powers and prerogatives of the government of this realm are vested.

34
The Queen’s Other Realms, Peter Boyce, (2009), Canberra Federation Press, page 5. Peter Boyce,
AO, is an Emeritus Professor in political science at the Universities of Queensland and Western Australia.
35
Theft by the tort of conversion is a Criminal Code s.322(1) offence. The only one who can consent to
conversion (“consensual interference”) is the owner of the property: 373409 ALBERTA LTD. v. BANK OF
MONTREAL, 2002 SCC 81, para. [9], http://canlii.ca/t/1fwx6 ; see Appellant’s Book of Authorities
36
R. v. Porisky and Gould, 2012 BCSC 657, at [46] http://canlii.ca/t/fppg9
37
Principles of Contract, 6th Ed., Sir Frederick Pollock, p. 107: “Officer: The Roman invention, adopted
and largely developed in modern law, of constituting the official character of the holders for the time being
of the same office, … into an artificial person… of legal capacities and duties."
38
Tax Court of Canada Act, R.S.C. 1985, c. T-2, s.17.1(2) Every person who may practise as a barrister,
advocate, attorney or solicitor in any of the provinces may so practise in the Court and is an officer of
the Court.
39
Tax Court of Canada Act, s.7(1) Subject to subsection (2), a judge holds office during good behaviour
40
The Queen v. The Canadian Broadcasting Corporation, [1957] O.J. No. 655

36 It is in that capacity that the Queen as sovereign, exercises her executive powers. The
statute that regulates the conduct of persons within Canada, -- in the instant case, The
Lord's Day Act, -- could have no application to natural persons outside of Canada and
therefore would not apply to Her Majesty in her capacity as a natural person because in
that capacity she is outside of Canada. The legal fiction which recognizes this
duality of persons in Her M ajesty must also recognize that in her capacity as a
corporation sole Her Majesty at all times is in every part of her realm. In those
parts of her realm in which she is not physically present she is
represented by her constitutional agents.
23. As Canada is a constitutional monarchy, HER MAJESTY THE QUEEN is the legal
equivalent of all Canadians41, and as many in this courtroom are in another capacity as
various court officers, it follows that I also can have at least two capacities for the purposes
of the six laws: as an individual, and as an officer for the purposes of the six laws. Actually, I
have at least three capacities when dealing with these six laws: as an individual, as an officer
for the six laws, and as an ITA “legal representative”42 that is liable43 as I applied for a Social
Insurance Number many years ago. I arguably may have a fourth capacity as a trustee (which
Jurisprudence says is yet another person in law44) if I am an officer handling Canada’s public
money. To help identify all these capacities, CRA has two definitions for the SIN; I have
concluded one (the “social insurance number” styled all in lower case) identifies me as an
officer or the office, and the other (the “Social Insurance Number” styled in upper and lower
case) identifies me as a legal representative who has agreed to be liable. Obviously, if I only
had one capacity for these six laws (which is agent for Crown’s position), then there would
be no need for CRA to have two different legal meanings for their acronym “SIN”.
24. To further help identify all these multiple capacities, agent for Crown changed the style of
my name in my Appeal from “William Russell” styled in upper and lower case letters to
“WILLIAM RUSSELL” styled all in upper case letters in their Motion to Strike, just like
they also styled HER MAJESTY THE QUEEN in all upper case letters45. As we just saw
from the Canada Broadcasting Corporation case that Her Majesty can only be legally
present in Canada through her office and/or officer (which is the Governor-General of
Canada), HER MAJESTY THE QUEEN styled all in upper case letters must be Queen
Elizabeth as an officer. It appears agent for Crown changed my name in their Motion to
WILLIAM RUSSELL in all upper case letters to identify me as an officer for the six laws.
25. What are the advantages to Canada to use such a federal officer for the six laws? The
summary below seems to describe how the ITA operates, and therefore supports my position.

41
Her Majesty legally personifies all Canadians: Citizenship and Immigration Canada (2009). Discover
Canada. Ottawa: Queen's Printer for Canada. p. 2.
42
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) definition of “legal representative”
43
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.159(1): Person acting for another (person)
44 th
Jurisprudence, Sir John Salmond, 9 Ed., Parker, p. 424: “It often happens that a single human being
possesses a double personality. He is one man, but two persons. Every contract, debt, obligation, or
assignment requires two persons; but these two persons may be the same human being. This
double personality exists chiefly in the case of trusteeship. A trustee, therefore, is for many
purposes two persons in the eyes of the law.”
45
Respondent’s Written Representations, page 1

1) The officer links the six laws. For example, accepting a GST credit is also accepting
the CPP and ITA office since they are the same office as the ETA (GST) office.
2) As the officer handles Canada’s public money, it imposes fiduciary duties on that
officer to report accurately and on time Canada’s public money.
3) As the officer handles public money, books and records are Canada’s property46.
4) As the officer handles Canada’s public money, the law imposes severe penalties for
breach of fiduciary duties on the officer if he fails to report accurately and on time
Canada’s public money, including perhaps charged with fraud against the public47.
5) Theft by the tort of conversion (spending Canada’s public money without Canada’s
permission) is a Criminal Code offence where innocence is no excuse48. That means
taxpayers charged with ITA offences cannot get off by pleading that they do not
understand the ITA even if it is, as Vern Krishna said, “mind-numbingly complex”.
6) The tort of conversion is one of strict liability49. That fits with the Tax Court of
Canada not being a court of equity50.
7) As the officer handles Canada’s public money, even if the officer is charged and
found not guilty of tax offences, Her Majesty can still recover her public money
through Tax Court of Canada through disgorgement51 from the officer. There are
three ways52: a) Accounting of the profits; once the profit is determined through the
accounting, the defendant must surrender it. b) Waiver of tort and instead base the
claim on the recovery of the public money. c) Constructive trust so any third party
owing money to the offending taxpayer must pay any money destined to the
offending taxpayer instead to Canada. This fits the legal basis for a Requirement to
Pay, and corroborates my position that the officer is also a trustee.
8) Disgorgement from the officer also means Canada does not have to prove in court
that a monetary loss actually occurred53.
9) It allows the law to give (and amend at any time) privileges unique to the office, such
as the ability to deduct certain expenses per ITA s.18(1)(a).
10) It allows the law to give (and amend at any time) benefits unique to the office, such as
various child tax credits, low income tax credits, housing credits, etc.
11) An individual, much like a limited company de facto54 director, can be treated as a de
facto officer if “it may be implied from the circumstances”55 that one wishes to be an
officer, such as accepting any benefit or privilege unique to the office.

46
Financial Administration Act, R.S.C., 1985, c. F-11, s.82
47
Tax evasion (failure to report accurately and on time public money) became a predicate offence (a
crime that is a component of and results in a more serious offence) to fraud (against the public) under the
Criminal Code July 2010.
48
373409 ALBERTA LTD. v. BANK OF MONTREAL, 2002 SCC 81, para. [8]; see Appellant’s Book of
Authorities
49
373409 ALBERTA LTD. v. BANK OF MONTREAL, 2002 SCC 81, para. [8]; see Appellant’s Book of
Authorities
50
Federal Income Tax Litigation in Canada, Christina Tari, 2009, paragraph 5.14.3.
51 th
Black’s Law Dictionary, 9 Ed.: Disgorgement: The act of giving up something (such as profits illegally
obtained) on demand or by legal compulsion.
52
Disgorgements of Profits in Canada by Smith and Berryman
53
Halsbury’s Laws of England, 1913, Volume 27, para. 918
54
Canadian Law Dictionary, 7th Edition, Coughlan: “de facto”: in fact; by virtue of the deed or
accomplishment; in reality; actually. Compare de jure.

12) As the owner of the private property is the only one who can to convert his private
property into public money by consenting to be a CPP/ITA/ETA officer by “filling the
office”56, if he accepts any benefits and/or privileges of the office “it may be implied
from the circumstances” that he consents to be such an officer.
13) The officer, for the sole office, links the six laws so that public money related to the
six laws all go into and out of the Consolidated Revenue Fund. This allows any public
money owed by the taxpayer from any one of the six laws can be settled with credits
or benefits (called the right of set-off) from any one of the other six laws57.
14) As all Canadians are deemed by the ITA to be officers handling public money with
the Consolidated Revenue Fund, and most Canadians have assented to be legally
liable through obtaining a Social Insurance Number from Services Canada, CRA can
assess any individual who has agreed to be liable with failure to comply with a
Requirement to Pay on a third party.
15) The office/officer could explain taxation of worldwide income since the office is
always domiciled in Canada regardless of where in the world the officer earns the
office’s income, as “the office and the officer are conceptually divisible but legally
indivisible”.
16) As the officer is an artificial person, there are no human rights for an individual as an
officer. The Canadian Bill of Rights58 does not apply. It also gives a plausible reason
why CRA’s Taxpayer Bill of Rights59 does not have to be, and is not, statute law.
17) Taxing an officer’s income does not violate that individual’s human right to private
property (outside Quebec) since it is not his property but Canada’s public money.
18) If the income tax can be imposed directly on an individual’s private property without
violating the common law right to private property, there would be no need to have
individuals represent a federal entity such as the CPP/ITA/ETA officer.
19) A Department of Justice Commentary on the Financial Administration Act60 (see
Book of Authorities Tab #6) confirms a fee may be charged by Canada for use of
benefits and privileges, such as those attached to an office. This fee can be the income
tax61. It follows that if one declines the use of such an office, as I did, and since there
is only one income tax rate scale, the ITA must deem income earned not for such an
office to be equal to zero. That is what ITA s.2(2), s.3, s.18(1)(a) and 18(1)(c) does.

55
373409 ALBERTA LTD. v. BANK OF MONTREAL, 2002 SCC 81, para. [9], ”No action lies in
conversion to chattels for consensual interferences with goods: the nature of these torts involves
wrongful interference with goods and an interference that is ed to cannot be wrongful. Consent may be
express, as in a contract or agreement for bailment or lease, or it may be implied from the
circumstances.” see Book of Authorities
56
Institutes of the Lawes of England, Coke on Littleton, Sir Edward Coke: Co. Lit. 2a: “A corporation sole
(office) is created by a man filling an office.”
57
ITA 224.1: Where a person is indebted to Her Majesty under this Act or under an Act of a province with
which the Minister of Finance has entered into an agreement for the collection of the taxes payable to the
province under that Act, the Minister may require the retention by way of deduction or set-off of such
amount as the Minister may specify out of any amount that may be or become payable to the person by
Her Majesty in right of Canada.
58
Canadian Bill of Rights, S.C. 1960, c.44
59
Taxpayer Bill of Rights at CRA website: http://www.cra-arc.gc.ca/rights/
60
Department of Justice Financial Administration Act Commentary (Revised), Department of Legal
Services, 1994, Werner Heiss, Editor, comments on subsection 19(1) of the FAA.
61
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.117(2)

20) Income tax is an internal tax62 since it is a tax for using the privileges of the federal
CPP/ETA/ITA office that is internal to the Government of Canada.
I will now address the case law used by agent for Crown to support their Motion to Strike.
26. Tuck corroborates my position that being deemed by the ITA as an officer is not just by ITA
s.6(3); it is also by ITA s.152(7): “an assessment is not dependent on return or information
supplied by the taxpayer”. In contrast to Tuck, my position is income tax obligations are not a
contract but a deemed fiduciary obligation; I am subject to the taxation laws, and the
deeming that individuals represent a CPP/ITA/ETA officer stands if not declared otherwise
(as happened to Tuck), and I did file tax returns. Therefore, my position has zero in common
to Tuck and I agree with the Court that to hear his case would be “a waste of time.”
27. In contrast to Hovey, I am liable as I agreed to be a legal representative, and the liability
extends to third party demands such as a CRA Requirement to Pay since the income of all
such officers are pooled together into the Consolidated Revenue Fund which is not the
private property of any of the parties involved but is Canada’s public money (addressed in
#14 in the list above). I am not claiming to be “acting in his capacity as a “natural person””
per Hovey i.e. claiming not subject to pay tax under the ITA. I concur with the Court in
Hovey that, “in my view, the “natural person” argument is without merit”, as Hovey’s
meaning of “natural person” is different from my meaning of “natural person” as I used it in
my private property contract.
28. In contrast to Rive, I agree the laws of Canada, including the ITA, apply to individuals, and
are why I also filed a return for the private property income received as an individual in
addition to the T1 filed for the office income. I also believe it is not “involuntary servitude”,
as my position shows how the ITA lets individuals override the deeming in the ITA to be
working as officers. I have already addressed my belief that it is not a contract. I concur with
the Court in Rive that it is “an abuse of process of this court”.
29. In contrast to Cassa, neither the Tax Court of Canada nor Crown said that my pleadings do
not comply with the TCC Rules. As for the “so-called “de-taxer” language” listed, I have
not used any in my pleadings and concur with the Court in Cassa that this Court should
instead hear “those self-represented litigants who are making an honest attempt to advance
the appeals through the Court system in a timely manner” instead of having this Court waste
their time on the scandalous and frivolous Motion to Strike, which is a clear abuse of process.
30. In contrast to Bertucci, I have stated that the ITA applies to me as an ITA “person” – in fact,
as multiple ITA “persons”: as an individual, as a legal representative, as an officer who is a
director of my limited company, and as another officer for the purposes of the six laws, and
probably also as a trustee. I concur with the Court that there was “absolutely no merit to any
of his arguments”.

62
Canada Revenue Agency Act, S.C. 1999, c.17, s.6(1)(d): “The powers, duties and functions of the
Minister extend to and include all matters over which Parliament has jurisdiction, not by law assigned to
any department, board or agency of the Government of Canada other than the Agency, relating to
internal taxes, including income taxes”

I will now comment on agent for Crown’s written representations.
31. Paragraph 11 refers to Meads, a divorce court case where the judge spent 160 pages out of a
180-page decision, or 89% of the decision, on an obiter (aside) about “OPCA Litigants”.
While I agree with the majority of what the judge signed off in Meads, my position is not
derived from any of these so-called “OPCA litigants” listed in Meads.
32. Paragraph 12 refers to the Porisky case (see Book of Authorities Tab #7). Porisky was
found guilty of tax evasion as he accepted63 deductions64 for the CPP/ETA/ITA office, as
summarized by spreadsheet by CRA Lead Investigator, Tony Brunke, a Certified General
Accountant (CGA). Spreadsheet summaries are permitted through the Scheel case if done by
a professional accountant65, but Brunke testified not as a CGA66, but as a so-called “fact
witness”. This would make the spreadsheet summary inadmissible, but Porisky accepted the
proposed deductions, so it was “implied from the circumstances” that he became a de facto
CPP/ETA/ITA officer and so had to pay CPP, GST and income tax for using the benefits and
privileges associated with the office. The judgment even reproduced67 the spreadsheet of the
deductions offered by CRA. Given the facts admitted by Porisky in his case, I agree that he
was guilty. However, while some facts of my case are similar to Porisky, I declined all
benefits and privileges associated with the office, so there is nothing that “may be implied
from the circumstances” that I assented to be such an officer. Agent for Crown again falsely
claims that I believe such income to be “exempt from taxation”. I have already addressed
their false statement earlier.
33. Paragraph 13 refers to Meads, which discusses other people’s beliefs that “absence of
consent provides the taxpayer with immunity from these legal obligations.” In contrast, I am
not opting out of legislative obligations as I have already stated that the law applies to me; I
am not saying that becoming an officer is a contractual obligation (the opposite – “may be
implied from the circumstances”); and the consent referenced in Meads at para 379-416 is
about being subject to the law and the courts (which I am subject to), and not about assent to
being deemed to be an CPP/ITA/ETA officer for the six laws. In fact, Meads has absolutely
zero reference to my position. In addition, 1) the ITA permits one to decline the deeming to
be such an officer68; 2) If it is compulsory, then the ITA would have used the word “shall”,
which is an imperative, and not the word “deem” over 3,600 times, which, from The
Composition of Legislation written for the Department of Justice (see Book of Authorities
Tab #2), “is used to establish legal fictions. For a statutory purpose it is often necessary to
deem a thing to be something it is not.” 3) Due to the fiduciary duties imposed on an officer
handling Canada’s public money, the law cannot compel one to be such an officer; or, as the

63
R. v. Porisky & Gould, 2012 BCSC 67, at [29]: “Mr. Brunke then deducted the expenses of Paradigm
which are summarized as follows: (chart of expenses shown). None of the above evidence was
challenged by Mr. Porisky in cross- examination or in his own evidence.” http://canlii.ca/t/fppg9
64
ITA s.18(1)(c): No deductions shall be made for an outlay or expense if for producing or gaining exempt
income
65
R. v. Porisky & Gould, 2012 BCSC 67, at [24]
66
67
68
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.6(3)

saying goes, “you cannot thrust a trust.”69 4) Crown’s position that Rive is wrong about
income tax being “involuntary servitude” also corroborates my position that it is voluntary to
be an officer for the six laws.
34. Paragraph 14 also refers to Meads stating, “Canadian law does not provide a person to have
two aspects.” This is on the Court’s conclusions in Stanchfield. I agree that this is a correct
statement based on the unique facts of that case, since Stanchfield was unable to provide the
Court with any case law, legal references, or even a plausible theory as to how this second
capacity is created, who creates it, what the characteristics of this second capacity are, and
how it is identified in writing, so the Court ruled correctly that there was no evidence before
the Court that an individual can have a second capacity for the purposes of the six laws. In
contrast, I have figured out how this second capacity, the CPP/ITA/ETA officer, is created,
who creates it, what the characteristics of this officer are, and how it is identified in writing.
This is also CRA Tax Protestor Position #3 which I addressed in my tax filing of my private
property income (Appendix E, page 63). I really think we don’t need to flog a dead horse
since, as I mentioned earlier, the court sheriff, the agent for Crown, the judge, and HER
MAJESTY THE QUEEN are all present in court in another capacity as various officers, HER
MAJESTY THE QUEEN, the legal equivalent of all Canadians, has two capacities to be
legally present in Canada, and agent for Crown admits that I am in court as an officer as a
director of my limited company. Ironically, Judge Kovatch in Meads could only make such
statements while in his capacity as a court officer.
35. Recall that CRA Lead Investigator Tony Brunke from the Porisky case can be a Certified
General Accountant or not at any time. My position is that one can also be an officer or not at
any time. For example, on April 7, 2016 Jody Wilson-Raybould spoke at a $500 a plate
dinner hosted by a Bay Street law firm. After both Canadians and the press questioned
whether there was a conflict of interest, Ms. Wilson-Raybould claimed70 that she attended the
dinner not in her capacity as Attorney General or as Minister of Justice (both Office #1), but
only as a Member of Parliament (Office #2). She attended Parliament the next day back as
Minister of Justice, Attorney General of Canada, and Member of Parliament. It follows that I
can also be an officer or not be that officer at any time.
36. Paragraph 23, agent for Crown states that, “The Appellant failed to report material amounts
of income from the Company in each taxation year under appeal.” This is false as all income
was reported: Canada’s public money on T1s and private property income by letter. I was not
charged with tax evasion or with false information on a return. As since 1991 a T1 form no
longer says it is authorized by the Minister of National Revenue71, and in the Gibbs72 case
(see Book of Authorities Tab #9), “The Crown conceded that … there was no
documentation whereby the Minister expressly authorized the form”, and the ITA does not
say a return shall be filed only on a T173, I have concluded that a T1 is a suggested form that

69 nd
The Law of Trusts, 2 Ed, Eileen Gillese, Irwin Law, p. 11.
70
http://news.nationalpost.com/full-comment/rex-murphy-liberals-play-the-race-and-misogyny-cards-to-
deflect-questions-about-its-500-per-person-fundraiser
71
Compare the 1990 T1 against the 1991 T1: http://www.cra-arc.gc.ca/formspubs/t1gnrl/llyrs-eng.html
72
Sandra June Gibbs v. Regina, 2006 BCSC 481 (CanLII), at [46] http://canlii.ca/t/1mwxt
73
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.150(1) and s.150(2)

a taxpayer can elect to use, and is for reporting only Canada’s public money received for her
office that is identified with the all-lower-case “social insurance number”. That is why I had
to report my private property income received not as such an officer by letter with the other
SIN, the Social Insurance Number, identifying me as being liable as a legal representative.
Once again, all my income was reported in prescribed form.
37. In paragraph 23 agent for Crown also says, “The Appellant was aware of his obligations to
report taxable income.” With respect, all taxable income74 was reported. I believe what agent
for Crown wants is my exempt income75, my private property, be consensually converted by
me into taxable income, as public money for their office, just like what the Court said in their
Introduction to their decision in the Redpath tax evasion case76 (see Book of Authorities
Tab #10), where those taxpayers, like me, had also declared all income:

As already noted and underlined, the original charge of 'omitting to declare income' was
later amended, at the request of the Crown and at the defence stage, by judgment of the
trial Court, over the objections of the defence, by adding the word 'taxable' to the
word 'income'.
For what it would have been worth, for the sake of clarity and to reflect the true nature of
the charge, if such a charge exists in law, and in view of the tax returns filed and their
manner of filing and the evidence adduced, it might have been more factual to couch the
information and state in the charge 'by omitting to declare income as taxable income'.
38. Stanchfield, a former Paradigm Educator, plea-bargained his tax evasion and fraud charges
down to one count each. CRA’s November 26, 2015 Press Release on the plea bargain (see
Book of Authorities Tab #8) carefully noted that Paradigm Education Group, the author of
my Private Contract, taught “how to restructure their affairs to avoid paying income tax”.
39. Agent for Crown’s assertion that all income is taxable income fundamentally violates
Canada’s common law right (outside Quebec) to private property for individuals who are not
officers. If all property belongs to Canada as her public property77 and as her public money78
then Canada has a Communist government when in fact it is building a Memorial to the
Victims of Communism in Ottawa79 near the Supreme Court of Canada. In contrast, my
position agrees that all income is subject to taxation, but that not all income is taxable
income, which gives Canada the best of both worlds - the flexibility to legally tax Canada’s
CPP/ITA/ETA office income while respecting common law right to private property. As I
have given examples of how my position makes sense, and as my position does not disagree
with any of CRA’s ten so-called Tax Protestor positions, and as the law supports my

74
Taxable income is defined by ITA s.2(2): “The taxable income of a taxpayer for a taxation year is the
taxpayer’s income for the year plus the additions and minus the deductions permitted by Division C.” I
did not accept any benefits (additions) or take any expenses as deductions in relation to my private
property contract income.
75
ITA, R.S.C. 1985, c. 1 (5th Supp.), s.248(1) definition of “exempt income”
76
HMTQ v. Redpath Industries Ltd. and Dominion Sugar Company Ltd., 84 DTC 6349
77
“Public property” is as defined by the Financial Administration Act, R.S.C., 1985, c. F-11, s.2
78
“Public money” is as defined by the Financial Administration Act, R.S.C., 1985, c. F-11, s.2
79
http://ottawacitizen.com/news/local-news/ncc-board-approves-new-site-for-memorial-to-the-victims-of-
communism

position, it is Crown’s Motion that is nonsensical, completely without merit, and is
demonstrative of Crown’s indifference as to whether Canada complies with common law and
international laws on private property rights or not.
40. It is scandalous that agent for Crown is asking for gross negligence penalties where no legal
basis exists. The Supreme Court of Canada said in Hodgkinson v. Simms80:
This was a case of material non‑disclosure in which the appellant alleged breach of fiduciary duty and breach
of contract against the respondent in the performance of a contract for investment advice and other
tax‑related financial services.
The respondent's behaviour calls for strict legal censure. The remedy of disgorgement is not sufficient to
guard against the type of abusive behaviour engaged in by the respondent. The law of fiduciary duties has
always contained within it an element of deterrence.
I make this point because an allegation of breach of fiduciary duty carries with it the stench of
dishonesty -- if not of deceit, then of constructive fraud. See Nocton v. Lord Ashburton, [1914]
A.C. 932 (H.L.).
41. As per Hodgkinson v. Simms above there could be penalties and fraud charges if there has
been a failure in fiduciary duty in reporting Canada’s public money accurately and on time,
but obviously there can be no penalties for mismanaging one’s own property. As I reported
all income, private and public, and as I never assented to convert my Private Contract’s
private property into Canada’s public money, and as I did not accept any benefits or
privileges related to the CPP/ITA/ETA office so that it could be “implied from the
circumstances” that I wished to fill such an office, no fiduciary duty is owed to the public
nor any fraud is committed against the public, so no “element of deterrence”, such as gross
negligence penalties, are applicable since my property stayed private and never became
Canada’s public money.
Motion to Dismiss
42. As I have demonstrated that it is agent for Crown’s Motion to Strike that is frivolous,
vexatious, and an abuse of process, I motion that agent for Crown’s Motion to Strike be
dismissed.
43. In addition, I motion that my Amended Notice of Appeal (amended Feb 24, 2016) not be
struck at all, but to stand as a whole.
44. As my property received under the Private Contract stayed as my private property and never
became Canada’s public money, I motion that agent for Crown’s motion for gross negligence
penalties to be dismissed.
Costs
45. For these reasons, costs should be awarded to the Appellant.

80
Hodgkinson v. Simms, 1994 CanLII 70 (SCC), [1994] 3 SCR 377 http://canlii.ca/t/1frpl

Tab M
Tax Court of
Canada’s
Order to Strike

Docket: 2015-5542(IT)G
BETWEEN:
WILLIAM RUSSELL,
Appellant,
and

Respondent.
Motion heard on common evidence with the motion in Lora Raddysh

2015-5541(IT)G on May 2, 2016 at Vancouver, British Columbia Before: The Honourable
Justice Valerie Miller
Appearances:

Counsel for the Respondent: Max Matas
ORDER
WHEREAS the Respondent has brought a motion pursuant to section 53 of the Tax Court of
Canada Rules (General Procedure) (the “Rules”) for an Order:
a) striking out the Amended Notice of Appeal under paragraph 53(1)(b) of the Rules on the ground
that the Amended Notice of Appeal is scandalous, frivolous or vexatious; or,
b) alternatively, striking out the Amended Notice of Appeal under paragraph 53(1)(c) of the Rules
on the ground that the Amended Notice of Appeal is an abuse of process; or,
c) alternatively, striking out the Amended Notice of Appeal under paragraph 53(1)(d) of the Rules
because it discloses no reasonable grounds for appeal; or,
Page: 2
d) in the further alternative, an Order under paragraphs 53(1)(b), 53(1)(c) or 53(1)(d) of the Rules
striking paragraphs 27, 28, 29, 30, 31, 33, 91-113, 114-163, and 174-182 of the Amended
Notice of Appeal; and,
e) in the further alternative, an Order under paragraph 44(1)(b) of the Rules extending the time in
which the Respondent may file a Reply to the Amended Notice of Appeal.
AND WHEREAS, the Appellant opposed the motion;
UPON hearing the representations of the parties and considering their written argument;
THIS COURT ORDERS that:
The Amended Notice of Appeal filed on February 22, 2016 is struck in its entirety without leave
to amend and the appeal is dismissed.
Counsel for the Respondent must serve and file his written representations regarding costs by June
3, 2016.
The Appellant must submit his written response regarding costs by

June 17, 2016.
Signed at Ottawa, Canada, this 18th day of May 2016.
“V.A. Miller”
V.A. Miller J.
Date: 20160518
Docket: 2015-5542(IT)G
BETWEEN:
WILLIAM RUSSELL,
Appellant,
and

Respondent.
REASONS FOR ORDER
V.A. Miller J.
[1] The Respondent has brought a motion pursuant to section 53 of the Tax Court of Canada
Rules (General Procedure) (the “Rules”) for an Order:
a) striking out the Amended Notice of Appeal under paragraph 53(1)(b) of the Rules on the ground
that the Amended Notice of Appeal is scandalous, frivolous or vexatious; or,
b) alternatively, striking out the Amended Notice of Appeal under paragraph 53(1)(c) of the Rules
on the ground that the Amended Notice of Appeal is an abuse of process; or,
c) alternatively, striking out the Amended Notice of Appeal under paragraph 53(1)(d) of the Rules
because it discloses no reasonable grounds for appeal; or,
d) in the further alternative, an Order under paragraphs 53(1)(b), 53(1)(c) or 53(1)(d) of the Rules
striking paragraphs 27, 28, 29, 30, 31, 33, 91-113, 114-163, and 174-182 of the Amended
Notice of Appeal; and,
Page: 2
e) in the further alternative, an Order under paragraph 44(1)(b) of the Rules extending the time in
which the Respondent may file a Reply to the Amended Notice of Appeal.
[2] The grounds for the motion are essentially that the Amended Notice of Appeal does not
disclose a cause of action; the pleadings are vexatious or an abuse of process; and, the Appellant
cannot obtain relief on the basis of the allegations pled in the Amended Notice of Appeal.
[3] The Respondent has brought a similar motion in respect of the Notice of Appeal filed by Lora
Raddysh who is the wife of William Russell (the “Appellant”). The issue in the Lora Raddysh
appeal is the Canada Child Tax Benefit and success in her appeal is contingent on the determination of
income in the Appellant’s appeal. In her appeal, Ms. Raddysh relied on the arguments made in the
Appellant’s appeal.
Law
[4] Section 53 of the Rules reads:
53. The Court may strike out or expunge all or part of a pleading or other
document, with or without leave to amend, on the ground that the pleading or other
document,
(a) may prejudice or delay the fair hearing of the action,
(b) is scandalous, frivolous or vexatious, or
(c) is an abuse of the process of the Court.
[5] When considering a motion under section 53 of the Rules, the facts alleged in the pleading are
assumed to be true: Operation Dismantle v Canada, [1985] 1 SCR 441 at 455. Only when it is plain
and obvious that the position taken in the pleading has no chance of success will it be struck: Hunt
v Carey Canada Inc [1990] 2 S.C.R. 959 at page 980. The test is a stringent one and the power to
strike out a pleading must be exercised with great care: Sentinel Hill Productions (1999) Corp v R,
2007 TCC 742. There is a high onus on the party seeking to strike a pleading: Robertson v R, 2006
TCC 147 at para.16-18; Hickman Motors
Page: 3
Ltd v R, 97 DTC 5363 (SCC) at page 5376. In making the decision whether to strike the Amended
Notice of Appeal or paragraphs in it, I cannot review any evidence.
The Amended Notice of Appeal
[6] A summary of the Amended Notice of Appeal follows.
[7] The years at issue are the 2010, 2011 and 2012 taxation years.
[8] The Appellant is a naturopathic doctor. He had DR. WILLIAM RUSSELL NATUROPATHIC
INC. (the “Corporation”) incorporated in 2003 under the laws of the province of British
Columbia. The Corporation carries on the business of providing health care services and the Appellant
is a shareholder and director of the Corporation.
[9] The Appellant also claimed that he is an “individual” of the Corporation.
[10] In 2010, 2011 and 2012, the Appellant received income from the Energetic Matrix Church of
Consciousness for his services as a facilitator; and, he also received fees from the Corporation for his
services as director. He reported these amounts on his income tax returns.
[11] In 2005, the Appellant, as “an individual (“Agent”)”, signed a contract with the
Corporation as “Principal”; a copy of the contract formed part of the Amended Notice of Appeal
and it was labelled Appendix B. The contract was titled “Contract for Hire – Private (Free Agent)
Agreement” but I will refer to it as the “Contract”. In the Contract, the Principal and Agent
relationship was defined for the purposes of various legislation including the Canada Pension Plan
(“CPP”), Taxes and Employment Insurance. With respect to “Taxes”, the Appellant consented
“to being engaged for his services in his capacity as a natural person”. The Contract further stated
that the Appellant did not consent to accepting or performing the duties of an “office or
employment” in the capacity of an “officer” or any other entity defined in the Income Tax Act
(“ITA”) for provincial or federal income tax purposes.
Page: 4
[12] According to the pleadings, the Appellant performed the duties as Manager for the Corporation.
He invoiced the Corporation for his services and the Corporation paid him $ 000, $ ,000 and
$ ,000 in 2010, 2011 and 2012 respectively. He wrote that he reported these amounts to the Canada
Revenue Agency (“CRA”) in a letter dated February 26, 2014. A copy of that letter formed part
of the Amended Notice of Appeal and it was labelled Appendix D. In that letter, the Appellant wrote
that these amounts which he received for his services as Manager from the Corporation were
“exempt income” because he “declined the ITA’s deeming to be a source while as Manager”. He
further wrote:
The written Agreement with the Corporation states that the Manager declined to be a
CPP/ITA “officer” with a social insurance number holding an office of profit.
While as Manager, I was not a CPP or GST “officer” either, since those are the
same as the ITA officer.
As a T1 is for filing income only from sources, there is no line on the T1 to file any
exempt income. I believe that I filed all income from all sources (ie., director’s
fees) but could not file the exempt income, which is also deemed by ITA Part I to
be equal to zero. There are no grounds for your proposed “Unreported Business
Income” or penalties, as there is no unreported income for the individual as
Manager, but instead only exempt income, which is sanctioned by the ITA and by
T1 to not be reported.
[13] The Appellant also pled that “it is legally impossible” to report the income made under the
Contract on a T1 return that uses the SIN as a “social insurance number” styled all in lower case letters.
[14] The Appellant was reassessed by the Minister of National Revenue (the “Minister”), by
notice dated May 23, 2014, to include the amounts he received from the Corporation in his income.
Gross negligence penalties were assessed pursuant to subsection 163(2) of the ITA.
[15] According to the Amended Notice of Appeal, the Appellant was also assessed under the
Canada Pension Plan (“CPP”) for contributions.
[16] In his notice of Appeal, the Appellant raised issues with respect to several federal and provincial
statutes aside from the ITA. Those issues are not relevant to this appeal because this appeal was filed
against the Notice of Reassessment
Page: 5
issued under the ITA. A summary of the issues raised by the Appellant with respect to the ITA
were:
a) Whether the income earned under the Contract was received by the Appellant in his
capacity as an “officer” within the meaning of section 248 of the ITA?
b) Whether the Appellant was entitled to receive the Goods and Services Tax Credit for the base
years 2010 and 2011?
c) Whether the Minister erred by assessing penalties under subsection 163(2) of the ITA against the
Appellant for 2010, 2011 and 2012.
d) Whether the term “Social Insurance Number”, referred to in subsection 237(1) of the ITA
and styled in both upper and lower case letters, is to be distinguished from the term “social
insurance number”, styled in lower case letters only and referred to in various CRA
forms. Specifically, whether a Social Insurance Number is assigned exclusively to an individual
who is a “legal representative” within the meaning of subsection 248(1) of the ITA, and a
“social insurance number” is assigned exclusively to an individual who is an “officer”
within the meaning of subsection 248(1) of the ITA.
[17] In the “Statutory Provisions Relied Upon” portion of the Amended Notice of Appeal,
the Appellant relied on the ITA and several other statutes which are not relevant.
[18] A brief summary of the “Reasons the Appellant Intends to Rely On” with respect to
the ITA are as follows:
a) Her Majesty is the (legal) personification of all Canadians. Her Majesty has a dual individual
capacity – as a natural person and a corporation sole. Therefore, all Canadians can also have dual
individual capacity.
b) The Appellant quoted from various decisions and various sections of the ITA; gave his
interpretation of the quotes and the sections; and, concluded that, while he performed services
under the Contract, he was not “clothed
Page: 6
with the powers of an officer” as that term is defined in section 248 of the ITA. Therefore
he was without legal capacity to convert his income from any source of income into profit.
c) The income he earned pursuant to the Contract is not income from an office, employment,
business or property because he did not claim any expenses. Therefore his income is deemed
to be zero by paragraph 3(f) of the ITA.
d) He never filled an “office” when he earned income under the Contract and he was not
charged for making omissions or false statements on a return under paragraph 239(1)(a) or with
tax evasion under paragraph 239(1)(d) of the ITA.
e) He filed all income by T1 (taxable income for the “office” as “officer”) and also by
letter (exempt income received not as “officer” under the Contract).
f) The income received by him under the Contract is exempt income and deemed to be zero
so that it prevents Her Majesty from doing theft by conversion. That is, it prevents Her
Majesty and her agents from converting his private property into “public money” within
the meaning of section 2 of the Financial Administration Act.
g) With respect to the penalties under subsection 163(2), it is the Appellant’s position that
an individual who deals with “public money” as an officer owes a fiduciary duty to the
public to report all “public money” earned from such “office”. Since a fiduciary duty
demands a high standard of performance, one cannot be forced to be such an “officer”
and he has declined to receive the income he earned under the Contract as “public
money”. He argued that the CRA agreed with him that he did not make an omission or false
statement because he was not charged under paragraph 239(1)(a) of the ITA.
Page: 7
Position of the Parties
[19] It was the Respondent’s position that the Appellant’s legal argument is a variation of the
concepts used by so called “de-taxers”. Counsel argued that this court has found that the argument
and position of de-taxers is without merit; does not disclose a reasonable ground for appeal; and, is an
abuse of the court’s process.
[20] It was the Appellant’s position that he was not using a “natural person” argument. He has
reported all of his income in 2010, 2011 and 2012. Some of that income he reported on a T1 and
some of it he reported in a letter to the CRA. He stated that all of his income was subject to tax
under the ITA. However, in 2010, 2011 and 2012, he received some of his income as an officer as
defined in the ITA and he reported this income and paid tax on it. He also received income in these
years not as an officer and this income was deemed by the ITA to be equal to zero.
Decision
[21] Although the Appellant argued that the facts in his case are substantially different from the facts
of the litigants referred to in the Meads v Meads, 2012 ABQB 571 decision, I disagree. He may not
have made a “natural person” argument in his Amended Notice of Appeal or at the hearing of this
motion, but his position was nevertheless clothed with the “natural person” concept at the time he
made the Contract between himself and his Corporation. The Appellant has used the same tactics that
J.D. Rooke A.C.J.Q.B. described in Meads as belonging to the Organized Pseudolegal
Commercial Argument litigants (“OPCA litigants”).
[22] The Appellant, like other OPCA litigants, ground his argument in a “belief” that “every
binding legal obligation emerges from a contract, and consent is required before an obligation
can be enforced”: Meads at para. 379. In this case, the Appellant argued that he has opted out of
being taxed for a large portion of the income he earned in 2010, 2011 and 2012. A taxpayer cannot elect
to contract out of the application of the Income Tax Act.
Page: 8
[23] The Appellant has also argued in his Amended Notice of Appeal that he exists in two separate
states. Those separate states for the Appellant are as an individual and an officer; and, depending on
which state he chooses, he doesn’t have to pay tax. The Appellant’s claims are “pseudolegal
nonsense” and are not supported by Canadian courts: Tuck v The Queen, 2007 TCC 418; Ian E
Brown v The Queen, 2014 FCA 301.
[24] First, I will address the amount of the reassessment for the 2012 taxation year and the fact that
gross negligence penalties were assessed against the Appellant.
[25] The Appellant has admitted that he received $ ,000, $ ,000 and
$ ,000 in 2010, 2011 and 2012 which he did not include in his income tax returns for those
years. However, according to counsel for the Respondent, the Appellant was assessed unreported income
of $ ,000 in 2012.
[26] In the Amended Notice of Appeal, the Appellant has not disputed the quantum of the
reassessments. He has not raised any potential discrepancy as an issue in this appeal. His only argument
is that he has elected not to be taxed on the amount he earned for his services as Manager for the
Corporation. Therefore, I have concluded that the Appellant did not appeal the additional amount of the
assessment for the 2012 year.
[27] The Appellant has been assessed gross negligence penalties and pursuant to subsection 163(3) of
the ITA, “the burden of establishing the facts justifying the assessment of the penalties is on the
Minister”. If this appeal proceeded to a hearing, the Respondent would have to prove (1) that the
Appellant made a false statement or omission in his 2010, 2011 and 2012 income tax returns, and (2)
that the statement or omission was either made knowingly, or under circumstances amounting to
gross negligence.
[28] It is my view that the facts necessary to prove that the penalties were properly imposed were
admitted in the Amended Notice of Appeal. The Appellant admitted in the Amended Notice of
Appeal that he failed to include income of $ 000, $ ,000 and $ ,000 in his 2010, 2011 and
2012 income tax returns. Although he gave a “pseudolegal” argument as to why he did not report
the income he earned under the Contract in his income tax returns, the
Page: 9
Appellant also admitted that he knowingly omitted this income. Unlike the case of Ian E Brown v The
Queen, 2014 FCA 301, the material facts necessary to meet the Minister’s burden were admitted
in the Amended Notice of Appeal.
[29] I have carefully considered the Amended Notice of Appeal, the oral and written submissions
made by the Appellant and counsel for the Respondent and I have concluded that the Amended Notice
of Appeal should be struck. The Appellant has not raised a cause of action. It is plain and obvious that
the position taken by the Appellant in his Amended Notice of Appeal has no chance of success
and it is an abuse of this court’s process. I order that the Amended Notice of Appeal be struck in
its entirety and the appeal is dismissed.
[30] Counsel for the Respondent requested that he be given the opportunity to address costs. He must
serve and file his written representations with respect to costs by June 3, 2016. The Appellant must
submit his written response regarding costs by June 17, 2016.
Signed at Ottawa, Canada, this 18th day of May 2016.
“V.A. Miller”
V.A. Miller J.

Tab N
Transcript
of
Order to Strike

2015-5542(IT)G; 2015-5541(IT)G
IN THE TAX COURT OF CANADA

(Before the Honourable Madam Justice Miller)
Vancouver , B.C.
May 2nd, 2016
BETWEEN:
WILLIAM RUSSELL and LORA RADDYSH,
APPELLANTS;
AND:
RESPONDENT.
PROCEEDINGS
Mr. W. Russell, Appearing on his own behalf;
Ms. L. Raddysh, Appearing on her own behalf;
Mr. M. Matas, Appearing for the Respondent.
Allwest Reporting Ltd.

th
12 Floor 1125 Howe Street
Vancouver, B.C
INDEX
PAGE
Submissions by Mr. Matas ............................ 3
Submissions by Mr. Russell ......................... 16

IN THE TAX COURT OF CANADA
2015-5542(IT)G
2015-5541(IT)G
BETWEEN:
WILLIAM RUSSELL and LORA RADDYSH,
Appellants;
- and -
Respondent.
--------------
Held before Madam Justice Miller, 6th Floor, 701 West
Georgia Street, Vancouver, B.C., on Friday, May 2nd,
2016.
--------------
APPEARANCES:
Mr. W. Russell, Appearing on his own behalf;
Ms. L. Raddysh, Appearing on her own behalf;
Mr. M. Matas, Appearing for the Respondent.

--------------
THE REGISTRAR: A. Dunn
--------------
Allwest Reporting Ltd.

12th Floor - 1125 Howe Street
Vancouver, B.C.
V6Z 2K8
Per: DARS
Allwest Reporting Ltd
Vancouver, B.C. 2
1 (PROCEEDINGS COMMENCED AT 9:32 A.M.)

2 THE REGISTRAR: This sitting of the
3 Tax Court of Canada is now open. The Honourable Madam
4 Justice Miller is presiding.
5 File 2015-5542(IT)G and 2015-5541(IT)G,
6 William Russell versus Her Majesty the Queen, and Lora
7 Raddysh versus Her Majesty the Queen. Mr. William
8 Russell appearing on his own behalf. Ms. Lora Raddysh
9 is appearing on her own behalf, and Mr. Max Matas is
10 appearing on behalf of the Crown.
11 JUSTICE: Thank you, Mr. Matas.
12 MR. MATAS: Thank you, Your Honour.
13 JUSTICE: First, before you start, I
14 tell you I’d like to hear one motion first, and then the
15 other. In other words, I’d like you to speak to the
16 motion, whichever one you choose first. Doesn’t matter
17 to me.
18 MR. MATAS: I have very brief comments
19 with respect to Ms. Raddysh’s appeal.
20 JUSTICE: Okay.
21 MR. MATAS: And I can explain that
22 upfront immediately.
23 JUSTICE: And?
24 MR. MATAS: I can explain what my
25 submissions are on Ms. Raddysh’s appeal immediately.
26 JUSTICE: Okay.
27 MR. MATAS: The issue in Ms. Raddysh’s
28 appeal is her entitlement to the Canada Child Tax
Vancouver, B.C. 3
1 benefit. Her entitlement is completely contingent on

2 the amount of income in Mister -- or sorry, Dr.
3 Russell’s 2010, 2011, and 2012 tax years. And the
4 result in Dr. Russell’s appeal will necessarily flow
5 through to Ms. Raddysh’s appeal. Ms. Raddysh’s notice
6 of appeal refers and relies on the arguments in Dr.
7 Russell’s amended -- or Dr. Russell’s pleadings and for
8 that reason, my submissions on Dr. Russell’s pleadings
9 apply to Ms. Raddysh’s appeal
10 JUSTICE: Okay. Okay.
11 SUBMISSIONS BY MR. MATAS:
12 MR. MATAS: So, I’ll move on to Dr.
13 Russell’s appeal. Our motion is to strike the pleadings
14 in their entirety on the basis that the pleadings are
15 abusive, and they have no reasonable grounds for appeal.
16 At its most basic, our position is as follows. Dr.
17 Russell received income in the years at issue, and he
18 was required to pay tax on that income.
19 In the pleadings it is admitted that he
20 received money in one year, the highest he earned was
21 $ , and these funds came from his own corporation.
22 Further, the funds were in exchange for services
23 provided. Now, as we understand his argument, it is
24 essentially that he never provided consent to have this
25 income be subject to taxation. This argument is a
26 variation of arguments that have been resoundingly
27 discredited by this court on a number of occasions. And
28 our position is that the appellant should not be
Vancouver, B.C. 4
1 permitted to bring this argument forward yet again.

2 JUSTICE: Okay.
3 MR. MATAS: I have a bit of a roadmap
4 of seven points that I will be making. The first is I
5 will set out the test for a motion to strike. Two, I
6 will address the Meads decision from Mount Werda, Court
7 of Queen’s Bench. Third I will address how the Tax
8 Court has dealt with, what I’ve called “tax protester”
9 cases. The fourth is I’d like to address some of the
10 specific facts in Dr. Russell’s amended notice of
11 appeal. The fifth point is I will be looking at the
12 meaning of “exempt income”, what's meant by that. The
13 sixth point is I have to address the 2012 tax year, as
14 there is a wrinkle in that year. And the last, number
15 seven, is the gross negligence penalties, I’d like to
16 address that specifically.
17 I have a book of authorities that I am
18 handing up that were previously provided to the
19 appellants, and within the book there is a small package
20 of additional authorities that were not ready at press
21 time.
22 JUSTICE: Okay.
23 MR. MATAS: So, my first point on what
24 is the test for a motion to strike, the rule under the
25 Tax Court Rules is Rule 53, and it is an extraordinary
26 remedy. It is not to be taken lightly, and the court
27 has set out some guidelines in the Sentinel Hill
28 decision, at paragraph 4. The citations for the case
Vancouver, B.C. 5
1 law and the specific paragraphs are in my written

2 argument.
3 JUSTICE: Yes.
4 MR. MATAS: And I won't be reading out
5 any of the quotes, but the citations are all there.
6 There are three requirements from the Sentinel Hill
7 case. First the facts alleged in the pleadings are
8 taken as true. Two, it must be plain and obvious that
9 the position in the pleadings has no hope of success.
10 Three, the motion judge should avoid usurping the
11 function of the trial judge in making determinations of
12 fact or relevancy.
13 And there is a further point that the
14 former Chief Justice Bowman explained in the Sentinel
15 Hill case, as a matter of warning, he explained that
16 these terms,
17 “Scandalous, frivolous, vexatious, or abuse
18 of the process of the court, these terms
19 should be reserved for the plainest and most
20 egregious or senseless assertions.”
21 Okay, going to my next point is the Meads
22 decision, and the point I wish to make here is that the
23 appellant’s arguments in the amended notice of appeal,
24 they are variations of these arguments that are
25 summarized and categorized by the Alberta court in the
26 Meads decision. It's a very long decision. I have
27 included an excerpt of relevant portions in our book.
28 More generally, the Associate Chief
Vancouver, B.C. 6
1 Justice Rook in Meads, identified a group of vexatious

2 litigants, who used variations of a flawed argument.
3 And he applied a term to these litigants as organized
4 pseudo-legal commercial arguments, rather as a term for
5 the arguments. And abbreviated to OPCA for short. He
6 also identified a number of “gurus”, that's his term,
7 who spread these arguments. And one identified as
8 Russell Proisky of the Paradigm Education Group.
9 Now, I bring this up because it is
10 admitted in the amended notice of appeal that the
11 contract that Dr. Russell entered into with his company
12 was provided by the Paradigm Education Group.
13 Now, there is two specific flawed
14 arguments that Justice Rook identifies that are
15 reflected in the pleadings. And the first is this idea
16 that a legal obligation requires consent of the
17 taxpayer. It is clearly evident in the pleading --
18 because there is an argument that Dr. Russell’s income
19 is exempt because he never consented to a conversion of
20 the income from some sort of private property into
21 public funds. There is a presumption in there that
22 consent is necessary for the obligations to have legal
23 effect.
24 In paragraph 411 of the Meads decision --
25 JUSTICE: Yes?
26 MR. MATAS: -- the court explained
27 that to claim this relationship requires consent or
28 contract, that claim is incorrect.
Vancouver, B.C. 7
1 The second flawed argument is the double

2 or split person argument. And the nature of this
3 argument is that for every human being there are two
4 legal entities and those legal entities may be subject
5 to different obligations depending on the circumstances.
6 At paragraph 422 Justice Rook rejected this argument.
7 He explained that,
8 “Canadian law does not provide for a person
9 to have two aspects. This entire concept is
10 yet another magic hat.”
11 This argument is clearly in the
12 pleadings, and I’ll bring our attention to one example
13 at paragraph 102 of the amended notice of appeal.
14 JUSTICE: Okay, just a moment.
15 MR. MATAS: It is argued here that the
16 appellant, Dr. Russell, is not a CRA tax protester, as
17 he believes he is two legal persons, but not two
18 separate people for income tax purposes.
19 Now, I’ll leave the Meads decision now,
20 and move on to Tax Court of Canada decisions. This is
21 point 3 on my roadmap.
22 The Tax Court has rejected variations or
23 recycled versions of these arguments, and I have in my
24 written representations, at paragraph 15, I have
25 summarized some of the comments that the courts have
26 decided. I have another copy.
27 JUSTICE: No, no, I have it. Okay, go
28 ahead.
Vancouver, B.C. 8
1 MR. MATAS: I have summarized it as

2 paragraph comments from various decisions. The
3 citations are there, but the court has called these
4 sorts of arguments a “waste of time”, “without merit”
5 certainly an “abuse of this court.” Further, “absurd
6 without merit,” “total and utter nonsense,” and finally,
7 “absolutely no merit in any of the appellant’s
8 arguments.”
9 Paragraph 16 I’ve reproduced a quote from
10 the Cassa decision, and I won't read it out, but the
11 point is here Justice Campbell described these arguments
12 as a song and dance. And what it does is it limits the
13 availability of the court’s resources for other matters
14 that have more merit to them.
15 It is worth noting that in three of the
16 cases listed here, Tuck, Olee Ventures, and Rive are all
17 motions to strike pleadings.
18 Okay, now I’d like to turn to the amended
19 notice of appeal.
20 JUSTICE: Okay.
21 MR. MATAS: There are a number of
22 facts that are admitted that support the assessments and
23 I'd like to run through those facts.
24 Number one, in paragraph one, Dr. Russell
25 was a director and a shareholder of a company called Dr.
26 William Russell Naturopathic Inc. At paragraph 8, it's
27 admitted that Dr. Russell preformed duties as a manager
28 of the company under a contract. And a copy of the
Vancouver, B.C. 9
1 contract is attached as Appendix B, which is at page 31,

2 if you're looking at the bottom right-hand corner.
3 JUSTICE: Yes.
4 MR. MATAS: And I'd like to point out
5 one, one part of the contract. On page 31, under
6 paragraph b(1), the relationship -- the agent, who is a
7 defined term as William Russell, consent to being
8 engaged in his services in his capacity as a natural
9 person. So there is a natural person element at the
10 basis of this whole arrangement.
11 The third fact, at paragraph 10 it's
12 admitted that Dr. Russell provided the company with
13 invoices for the work he performed. And a copy of one
14 of those invoices is Appendix G to the notice of appeal,
15 which is at page 39.
16 JUSTICE: Yes.
17 MR. MATAS: And then at paragraph 11,
18 it's admitted that the company paid Dr. Russell the
19 following amounts: in 2010 it was ,000, in 2011
20 , and 2012, ,000. And then over at paragraph
21 12 and 13 it's admitted that that Dr. Russell did not
22 report this income on his tax return, but it is also
23 admitted that he reported other employment income from
24 the company and from the Energetic Matrix Church of
25 Consciousness.
26 These facts are sufficient to support the
27 assessment. It's admitted that Dr. Russell received
28 income and that income was exchanged for services
Vancouver, B.C. 10
1 provided, and that is enough to support the assessment.

2 There's no further requirement of consent.
3 I would like to now address the concept
4 of exempt income under the Income Tax Act.
5 JUSTICE: Before you go any further,
6 there was somewhere in your written submissions that you
7 stated that Mr. Russell was assessed for 2012, ,000
8 and I see he's admitted ,000.
9 MR. MATAS: Yes, I'll address that now
10 rather -- that was my sixth point though, I will move it
11 around.
12 JUSTICE: Okay.
13 MR. MATAS: That is -- there's a
14 discrepancy between what's admitted there and the
15 assessment of $ 000. Now, if the quantum of this
16 estimate was the issue we would absolutely concede
17 that's a triable issue and we would not oppose the
18 notice of appeal to be amended to reflect that, that
19 issue. But as the pleadings now stand the issue is not
20 the quantum of the assessment, it is more in the nature
21 of Dr. Russell's not subject to taxation of any of this
22 money. And that argument in itself is abusive and
23 should be struck.
24 Now, I will move on to what's meant by
25 exempt income under the Act, and I will begin at the
26 beginning -- well near the beginning of the section 3 of
27 the Act. Under section 3 a taxpayer's income for the
28 year includes all amounts each of which is income from a
Vancouver, B.C. 11
1 sources including income for office, employment,

2 business and property. It's useful to read section 9
3 together. Section 9 states,
4 "…a taxpayer’s income for a taxation year
5 from a business or property is the
6 taxpayer’s profit from that business or
7 property…"
8 So there's two concepts or two words that
9 come up, "income" and "profit" and they're not defined
10 in the Act. And for that reason I provided in the
11 loose authorities some dictionary definitions.
12 I will begin with the Canadian Oxford
13 Dictionary. It should be the -- after the Income Tax
14 Act copies there's some copies from the Canadian Oxford
15 Dictionary. And the definition of income is,
16 "Money or other assets received, especially
17 periodically, in a year from one's business,
18 work, investment et cetera."
19 And then profit from the same dictionary,
20 the next page is,
21 "Financial gain, excessive returns over
22 outlays for an advantage or benefit."
23 Now Black's Law Dictionary has some
24 similar definitions.
25 "Income is the money or other form of
26 payment that one receives, usually
27 periodically from employment, business,
28 investment, royalties, gifts and the like."
Vancouver, B.C. 12
1 And profit is,

2 "The excess of revenues over expenditures in
3 a business transaction."
4 Now, applying these definitions to the
5 case, the money that Dr. Russell received from his
6 company meet these definitions of either income or
7 profit. The work he did -- or the payment he received
8 was in exchange for services, it would appear to meet
9 the definition.
10 Now, there is as concept of exempt income
11 in the Income Tax Act. I didn't provide a copy of the
12 defined term, it's in the amended notice of appeal, but
13 the definition under section 248 of the Income Tax Act
14 doesn't really explain what exempt income, other than
15 saying it's not -- it's income that's not included in
16 computing the person's income.
17 So I provided a copy of section 81 of the
18 Act and that would be the first bundle in the loose
19 authorities. And many of the categories of exempt
20 income in the Act are found here. And I won't go
21 through each of them, but I've identified a number that
22 are -- they give a sense of what's included here.
23 The very first is income that is declared
24 exempt by an enactment of parliament and the most common
25 would be income exempt under the Indian Act. There is
26 also pensions or allowances for veterans, there is
27 compensation paid as an allowance in respect of death or
28 injuries sustained in the explosion in Halifax in 1917.
Vancouver, B.C. 13
1 There is compensation for victim of the National

2 Socialist Persecution from the Federal Republic of
3 Germany. There's other damages for physical and mental
4 injury. And there's certain forms of social assistance.
5 What there isn't here is any exemption
6 for funds received under a private contract or funds
7 there under some sort of private arrangement. Now, the
8 point being that there is certain categories of exempt
9 income under the Act, but what we have in this case
10 doesn't meet any of those categories.
11 I will move on to my last point and
12 that's the penalties. The burden of establishing the
13 facts that support gross negligence penalties rest with
14 the respondent. And this complicates our motion. I've
15 included the Brown decision, and that's from the Court
16 of Appeal, and here the court found that the Tax Court
17 had erred by striking pleadings in respect of penalties.
18 At paragraph 20 of the decision the court wrote that,
19 "…it wasn't plain and obvious that the
20 Minister wwould be successful in
21 establishing the facts to justify the
22 assessment of the gross negligence
23 penalties…"
24 And so the matter was sent back to
25 proceed on penalties alone.
26 Now, we see this case as distinguishable
27 for two reasons. First, the arguments are different in
28 this case. In Brown the argument was that the Act was
Vancouver, B.C. 14
1 vague and then further at the Court of Appeal he only

2 wished to pursue the penalties. He didn't wish to
3 pursue the underlying assessment -- or that became clear
4 at the Federal Court of Appeal. Here in this case --
5 JUSTICE: No, what else -- there was
6 something else you said. You said that --
7 MR. MATAS: The argument the Act was
8 so vague.
9 JUSTICE: The what was so vague?
10 MR. MATAS: The Income Tax Act was
11 overly vague.
12 JUSTICE: Who said that, the Federal
13 Court of Appeal?
14 MR. MATAS: No, no, the appellant.
15 JUSTICE: Okay.
16 MR. MATAS: That was the argument
17 raised in the pleadings.
18 JUSTICE: Okay.
19 MR. MATAS: In this case the argument
20 is that Dr. Russell had to consent to converting his
21 money into public money before it could be subject to
22 taxation. And this argument is in itself is abusive,
23 and this is the argument that is used by Dr. Russell
24 with respect to penalties as well as everything else.
25 And that argument should not be allowed to proceed.
26 The second point is that there are
27 admitted facts in the notice of appeal that are
28 sufficient to support the imposition of penalties. Dr.
Vancouver, B.C. 15
1 Russell failed to report material amounts of money. He

2 was aware of his obligation, which is clear from the
3 fact that he reported other sources of income. His sole
4 reason for not reporting was his view that it was exempt
5 and we see it as this demonstrates his indifference as
6 to whether the law was complied with or not.
7 And I have the last loose document is the
8 Carrol Strachan decision from the Court of Appeal.
9 Here the court confirmed that,
10 "Gross negligence may be established where a
11 taxpayer is willfully blind to the relevant
12 facts in circumstances where the taxpayer
13 becomes aware of the need for some inquiry
14 but declines to make the inquiry because the
15 taxpayer does not want to know the truth…"
16 I'm referring to paragraph 4. We say
17 that it's evident from the amended notice of appeal that
18 the same could be said here. Dr. Russell did not want
19 to know the truth that he had to pay his tax on his
20 income. He was willfully blind to his obligations and
21 indifferent as to whether the law was complied with or
22 not.
23 Now, if we haven't met our onus, in the
24 alternative we've set out the paragraphs that we say
25 should be struck, leaving those paragraphs relevant to
26 penalties. And that's in the Notice of Motion and the
27 written representations.
28 So those are my submissions, thank you.
Vancouver, B.C. 16
1 I would like an opportunity to address cost following

2 judgment. Thank you.
3 JUSTICE: Thank you. Mr. Russell?
4 SUBMISSIONS BY MR. RUSSELL:
5 MR. RUSSELL: Just pass this up to the
6 Judge. And there's one for you. This is just my Book
7 of Authorities.
8 So I am William Russell and I also had
9 filed a reply to the Notice of Motion on Wednesday.
10 JUSTICE: Yes.
11 MR. RUSSELL: And in my first opening
12 sentence I did say that I am not taking the position of
13 being an natural person as used in the case lot in your
14 written representations.
15 So in overview, the Crown claims my
16 amended Notice of Appeal does not disclose reasonable
17 grounds for appeal. In this submission I will give a
18 few concise examples of why it does disclose reasonable
19 grounds for appeal.
20 My amended Notice of Appeal goes into
21 more detail, and my April 27th, 2015 Notice of Objection
22 representations to CRA, which is Appendix E, is in even
23 more detail, including spreadsheets analyzing over 20
24 CRA forms, flow charts unraveling the Income Tax Act,
25 and internal CRA documents.
26 JUSTICE: I'm just going to stop you
27 for a second.
28 MR. RUSSELL: Yes.
Vancouver, B.C. 17
1 JUSTICE: I want to make sure that I

2 have the correct document that you call your amended
3 notice of appeal.
4 MR. RUSSELL: Yes.
5 JUSTICE: I'm looking at -- it's
6 notice of appeal, amended February 22nd, 2016?
7 MR. RUSSELL: Correct.
8 JUSTICE: That's the correct document?
9 MR. RUSSELL: Yes.
10 JUSTICE: Okay, thank you.
11 MR. RUSSELL: The Crown says that I
12 believe certain of my income is exempt for taxation.
13 This is not accurate. My position is that all of my
14 income is subject to tax under the Income Tax Act.
15 During the taxation years under review --
16 JUSTICE: And I'm trying to write,
17 okay?
18 MR. RUSSELL: Sorry.
19 JUSTICE: I know you're reading, but--
20 MR. RUSSELL: Okay, sorry.
21 JUSTICE: Okay, so go again.
22 MR. RUSSELL: During the taxation
23 years under review I received some income as an officer
24 as defined in the Income Tax Act, and some income not as
25 an officer within the meaning of that Act. The income I
26 received as an officer as defined in the Income Tax Act
27 was properly taxed under that Act and I paid tax on that
28 income in each of the taxation years under review.
Vancouver, B.C. 18
1 The income I received not as an officer

2 is deemed by the Income Tax Act to be equal to zero in
3 calculation of my total income for the taxation years
4 under review. The Crown states that I did not report
5 the private property income on T1 returns, and my
6 position is that it is legally impossible to report
7 income that I wish to stay as private property on CRA's
8 T1 form.
9 This representation will show the basic
10 logic I used to arrive at this conclusion. The Crown
11 states that I failed to report taxable income. This is
12 incorrect. CRA has not charged me with tax evasion or
13 false information on a return. First, my position does
14 not disagree with the ten wrong positions taken by what
15 CRA labels as tax protesters. I addressed all ten when
16 I reported to CRA my private property income that I
17 received, that was not for an income tax officer for Her
18 Majesty's office, in Appendix E.
19 It is my position -- if my position had
20 disagreed with even one of CRA's ten tax protester
21 positions I would not have appealed. Clearly just this
22 is one crucial smell test, my appeal cannot be an abuse
23 of process. The facts of my appeal are substantially
24 different from all the seemingly similar cases involving
25 tax evasion cited by the Crown in its motion to strike,
26 and I will address each of them in detail later.
27 In addition to having a different set of
28 facts, my position is based on research that is not from
Vancouver, B.C. 19
1 any of the so-called OPCA litigants listed in the Meads

2 divorce case, but instead is drawn from CRA forms, the
3 CRA website, and government books and documents. All
4 this was used to reverse engineer the Income Tax Act. I
5 would not have to do this if the Income Tax Act is easy
6 to understand, but it is not.
7 I know of four former CRA officers,
8 including two in investigations, one in Income Tax Act
9 interpretation, and one who wrote the former tax
10 operations manuals, and they all admit that they do not
11 understand how the Income Tax Act works. Even Canada's
12 eminent tax guru, Vern Krishna said -- and it's under
13 Appendix F:
14 "Canadians must enjoy being taxed. Why else
15 would we placidly tolerate a tax regime that
16 is so mind-numbingly complex,
17 incomprehensible and expensive? Individuals
18 who do not have even the remotest
19 understanding of tax law must, under the
20 threat of civil and criminal sanctions,
21 comply with the fiction that everyone is
22 presumed to know the law.
23 The Income Tax Act is the largest and most
24 complicated statute in Canadian law. The
25 sheer volume of legislation to regulations,
26 changing administrative practices, new
27 treaties and judicial decisions means that
28 no single person can ever expect to fully
Vancouver, B.C. 20
1 understand the entire tax law in one

2 lifetime. In income tax law, we are a long
3 way from writing legislation that ordinary
4 intelligent people can understand."
5 While my in-depth analysis that was filed
6 with CRA uses 20 CRA forms, I will give you a quick
7 example of my position using just two. The T1 and the
8 CR199 E --
9 JUSTICE: RC.
10 MR. RUSSELL: RC199 E, 2013, voluntary
11 disclosure form. My position does not disagree with
12 what is taught in law and accounting schools, nor does
13 it disagree with any of the CRA's ten so-called tax
14 protester's positions. A T1 form and associated
15 schedules involves at least 6 laws. The Canada Pension
16 Plan, the Employment Insurance Act, the Excise Tax Act
17 for GST, two Income Tax Acts, federal and provincial,
18 and the Financial Administrative Act. And since page 4
19 of the IT-1 says to pay the Receiver General, and the
20 Financial Administrative Act says, "Consolidated Revenue
21 Fund means the aggregate of all public moneys that are
22 on deposit at the credit of the Receiver General." I
23 will refer to them all as the six laws.
24 The "officer" is defined in the Canadian
25 Pension Plan, Employment Insurance Act, Income Tax Act,
26 and the Excise Tax Act for GST as the same officer. And
27 the dealings, an individual as an officer is a common
28 thread that weaves through all six laws, links them
Vancouver, B.C. 21
1 together, and determines when one has to pay CPP or no

2 CPP, EI or no EI, and GST or no GST.
3 To pick GST as one of the three to use as
4 an example, if an individual is working for someone
5 else, which is ITA employment, which equals the position
6 of an individual as an officer. CPP employment equals
7 -- includes the tenure holding other office. Therefore
8 no GST needs to be remitted as an individual taxpayer is
9 merely holding a position, so no goods and services has
10 been created. And in contrast the ITA employed someone
11 in his own business is defined as performing the duties
12 of an office. So GST from the Excise Tax Act must be
13 charged if the officer is performing duties and created
14 a service.
15 My position also explains what happened
16 when CRA confirmed their assessment on September 25th,
17 2015 and proposed that my income from my private
18 property contract is in Income Tax Act section 9(1),
19 which is a business source of income, also ITA employed.
20 So GST must be charged as the officer is performing
21 duties and so has created a service.
22 As the six laws are interlinked, the
23 reverse is also true. Accepting GST is assenting to
24 receive income for the Canada Pension Plan, Income Tax
25 Act, Excise Tax Act office. This is why in my private
26 property contract I declined the Income Tax Act's
27 deeming that I received income as a Canada Pension Plan,
28 Income Tax Act, and Excise Tax officer as Canada's or
Vancouver, B.C. 22
1 Her Majesty's public money. Instead I received that

2 income as private property.
3 It is common knowledge that GST is Her
4 Majesty's public money since the Excise Tax Act office
5 is the same office as the Canada Pension Plan and Income
6 Tax Act office, it follows that the money received as a
7 Canada Pension Plan, Income Tax Act and Excise Tax
8 officer is also Canada's public money.
9 In my notice of objection I detailed how
10 the individual's type of dealings as an officer also
11 acts as an on/off switch not just for GST but also as an
12 on/off switch for CPP and EI. I explained it again
13 graphically using four sequential flow charts. And if
14 the odds of this officer playing a pivotal role in GST,
15 as I have just shown is correct, the odds are even more
16 so when I showed it in my filings how this office and
17 officer allows these six laws to operate not only
18 individually but interlink together and which is why all
19 six laws interact together on one form, CRA's T1 form.
20 That is another reason why it is not my appeal but
21 rather Crown's motion to strike that scandalous,
22 frivolous and abuse of process.
23 Another simple example of the pivotal
24 role of the Canada Pension Plan, Income Tax Act, and
25 Excise Tax Act officer is the definition of "employee"
26 in the Income Tax Act, where "employee" includes an
27 officer. The Composition of Legislation by Driedger
28 says: "Includes to retain the ordinary meaning of a
Vancouver, B.C. 23
1 word and add a meaning it does not normally have or to

2 settle a doubt whether a word means a particular thing.
3 Therefore an ITA employee is either someone who works
4 for someone else, the ordinary meaning of the word, or
5 someone who works as an officer at a meaning it does not
6 normally have."
7 The second definition, "An Income Tax Act
8 employee only means an officer, which is to settle a
9 doubt whether a word means a particular thing, the point
10 is whether one uses the first definition or the second
11 definition of "includes" variably one has to deal with
12 these Canada Pension Plan, Income Tax Act, and Excise
13 Tax officer that simply cannot be ignored."
14 Unlike similar cases, including the
15 Stanchfield case used by Crown in its motion to strike,
16 I've also reverse engineered how this federal office is
17 created, who creates it and how CRA identifies the
18 office/officer on their forms. CRA has some knowledge
19 of how and who creates this offices as they describe on
20 their website as CRA tax protester position number 5, as
21 no one has ever presented this in the court, my appeal
22 is not an abuse of process.
23 I also discovered that CRA has used the
24 acronyms SIN, S-I-N, since 2001, to identity two
25 different legal capacities. One of these is a Canada
26 Pension Plan, Income Tax Act, and Excise Tax officer,
27 and the other is an Income Tax Act legal representative.
28 The T1 uses the all lower case social insurance number
Vancouver, B.C. 24
1 to identify the Canada Pension Plan, Income Tax Act, and

2 Excise Tax office or officer, while CRA's CR199 E 2013
3 form, which is for making a voluntary disclosure, uses
4 the upper and lower case social insurance number to
5 identify the individual as a ITA legal representative.
6 And I just have -- this was not in my
7 Appendixes, so I'd like just to submit that. That's the
8 RC199 E. CRA's RC199 form warns the taxpayer that the
9 information that I have disclosed to the Canada Revenue
10 Agency may result in enforcement action taken against
11 me, wherein an assessment or reassessment may be issued,
12 penalties or interest may be levied, or an investigation
13 or prosecution may be initiated. To be substantially
14 certain I analyzed 20 different CRA forms and my
15 conclusion fits all of these forms 100 percent, which
16 I've outlined in my Notice of Objection.
17 I also have an affidavit from a taxpayer
18 who has never applied for a social insurance number, and
19 that is at tab --
20 MR. MATAS: Your Honour --
21 JUSTICE: The respondent is standing,
22 so, yes, I'll hear from you.
23 MR. MATAS: Your Honour, the
24 respondent objects to the admissibility of the affidavit
25 that's being referred to on the grounds of relevancy.
26 MR. RUSSELL: On the grounds, sorry?
27 JUSTICE: Relevancy he says.
28 MR. RUSSELL: Okay. So that would be
Vancouver, B.C. 25
1 under Appendix I.
2 JUSTICE: Just a second. I agree with
3 the Crown, with Mr. Matas. I don’t see -- is it
4 Appendix I?
5 MR. RUSSELL: Should be Appendix I,
6 that should be Appendix I, sorry.
7 JUSTICE: Oh, it's Appendix I in your
8 notice of appeal?
9 MR. RUSSELL: The submission I did in
10 --
11 JUSTICE: It's just that I'm trying to
12 find --
13 MR. RUSSELL: It would be actually
14 under tab 5, sorry.
15 JUSTICE: Okay. Yeah, I did see the
16 affidavit, and I agree that it is not relevant, it is
17 dealing with another taxpayer.
18 MR. RUSSELL: I guess I believe that
19 what it does is it helps to corroborate my position that
20 an acronym SIN represents two legal capacities.
21 JUSTICE: You can say that if you
22 wish, but what happens with respect to the taxation of
23 one taxpayer is not relevant with respect to a second
24 taxpayer. So, as far as I am concerned, it is not
25 relevant for the matter before me.
26 MR. RUSSELL: Okay. The CR website
27 has two different descriptions for the two SINs, and
28 that's at Tab 3 in my Book of Authorities. Tab 3 and
Vancouver, B.C. 26
1 Tab 4 actually. And it is positing that one of these

2 SINs, which is the all lower case social insurance
3 number identifying the office or officer is not defined
4 nor use in any of the six laws, and that the two legal
5 meanings for the acronym SIN, S-I-N, is not taught in
6 law or accounting schools. And I have yet to find a
7 single tax lawyer or tax accountant that is aware of
8 this, and therefore not surprised that the Crown does
9 not also understand my position.
10 As -- what is the significance of an
11 office? Offices have long been regarded as a form of
12 property. Since the property belongs to the officer,
13 and not to the individual unless he is acting in his
14 capacity as an officer, the officer is normally allowed
15 use of some office income for living expenses. This has
16 led to people illegally taking over, buying or selling
17 offices. England enacted a Sales of Offices Act in 1551
18 to punish those who illegally took over offices to take
19 all of that office's income for themselves. The crime
20 was simony, is a buying or selling of a religious
21 office. Cargo Revere bought the papacy for himself in
22 1503 and became Pope Julius II. He is most remembered
23 because he was the patron of Michelangelo, and for the
24 building of the St. Peter’s Basilica.
25 After his death collecting money for St.
26 Peter’s Basilica became one more pretext for selling
27 indulgences, but Martin Luther found out in 1517 that 50
28 percent of the money being paid by the faithful for
Vancouver, B.C. 27
1 indulgences to rebuild St. Peter’s was going to

2 financial house of Futer. And because they had lent a
3 large sum of money to Archbishop Albert of Mains, so
4 that he could buy his high office from Pope Leo X, and
5 that led to Martin Luther starting the protestant
6 movement.
7 My point to all these fun historical
8 facts is that income from any office is not my private
9 property, it belongs to the office. The Income Tax Act
10 deems individuals to be a Canadian Pension Plan, Income
11 Tax Act, Excise Tax officer. The composition of the
12 legislation deems -- defines “deems” as,
13 “Used to establish legal fictions, for a
14 statutory purpose. It is often necessary to
15 deem a thing to be something it is not.”
16 Since the office and the officer are
17 conceptually divisible but legally indivisible, the
18 officer’s income belongs to the office.
19 The T1 says pay the Receive of General of
20 Canada who collects public money for the consolidated
21 revenue fund. The point is being such an officer for
22 the six laws also serves to convert the individual’s
23 private property into public money that now belongs to
24 Canada. Such a shift in the title of the property gives
25 Canada extremely powerful legal powers for enforcement,
26 collection, and recovery of Canada’s public money.
27 Corporations which are artificial persons
28 in law can either be aggregate or sole. I have a
Vancouver, B.C. 28
1 corporate corporation aggregate, a limited company, Dr.

2 William Russell, Naturopathic Inc. I am an officer of
3 my corporation as a director. As it is an artificial
4 person, my limited company is obviously a separate legal
5 person from me as an individual.
6 In the Periski case, the Asian case, the
7 judge said that a corporation sole applies to an office.
8 Both offices and officers are therefore also artificial
9 persons in law. And as I am standing here in front of
10 you reading this, I am obviously not an artificial
11 person. The law, however, allows me to represent
12 artificial persons, whether as an officer for my limited
13 company as a director, or as an officer for the purpose
14 of the six laws.
15 To corroborate my point here in court,
16 the court sheriff, Crown counsel, and the judge are all
17 acting in their capacity as court officers. Her Majesty
18 the Queen, as respondent, is in Canada legally only
19 through her office of the Governor General of Canada.
20 And since the Queen is an individual, as an individual
21 is physically in the United Kingdom, in the case of the
22 Queen v. Canada Broadcasting Corporation, at paragraph
23 35,
24 “It is important that at the onset we
25 should understand the connotation of the words ‘Her
26 Majesty’ in the Act. When parliament names Her Majesty
27 in a statute, it means Her Majesty not in her capacity
28 as a natural person, but in her capacity as a
Vancouver, B.C. 29
1 corporation sole. A persona ficta. In the Solomon on

2 Jurisprudence 9th Edition, at page 444, the author refers
3 to is dual capacity as follows.
4 He, the King, has a double capacity,
5 being not only a natural person, but a body politick.
6 That is to say a corporation sole. The variable wearer
7 of the crown is merely the living representation and
8 agent for the time being of this invisible and
9 underlying persona ficta, in whom by our law the powers
10 and prerogatives of the government of this realm are
11 invested.”
12 The paragraph 36, “It is in that capacity
13 that the Queen as sovereign exercises her executive
14 powers. The statute that regulates the conduct of
15 persons within Canada. In the instant case, the Lord's
16 Day Act, could have no application to natural persons
17 outside of Canada, and therefore it would not apply to
18 Her Majesty in a capacity as natural person because in
19 that capacity she is outside of Canada. The legal
20 fiction which recognizes this duality of persons in Her
21 Majesty must also recognize that in her capacity as a
22 corporation sole, Her Majesty at all times is in every
23 part of her realm, and in those parts of her realm in
24 which she is not merely present, she is represented by
25 her consitual agents.”
26 As Canada is a constitutional monarchy,
27 Her Majesty the Queen is the legal equivalent of all
28 Canadians. And as many in this courtroom are in their
Vancouver, B.C. 30
1 capacity as various court officers, it follows that I

2 can also have at least two capacities for the purposes
3 of the six laws. As an individual, as an officer for
4 the purpose of the six laws, and actually I have at
5 least three capacities when dealing with the six laws.
6 As an individual, as an officer of the six laws, and
7 also as an Income Tax Act legal representative that is
8 liable, as I applied for a social insurance number many
9 years ago. I arguably have a fourth capacity as a
10 trustee, which jurisprudence says is yet another
11 personal law, if I am an officer handling Canada’s
12 public money.
13 To help identify all these capacities,
14 CRA has two definitions for the SIN. I have included
15 one, the social insurance number style all in lower
16 case, identifies me as an officer, or the office, and
17 the other, the social insurance number styled in all
18 upper and lower case identifies me as a legal
19 representative who has agreed to be liable.
20 Obviously, if I only had one capacity for
21 the six laws, which is the transposition, then there
22 would be no need for CRA to have two different legal
23 meanings in their acronym for SIN, S-I-N. To help
24 further identify all these multiple capacities, when I
25 sent in my information to the Crown, Crown changed my
26 style of my name in my appeal from William Russell,
27 upper and lower case, styled in upper and lower letters
28 to William Russell all upper case. Which identifies me
Vancouver, B.C. 31
1 as an officer, or the office. Sorry. I missed my spot

2 here. Okay, yeah.
3 So, they also styled it in all upper
4 case, just like they also styled Her Majesty the Queen
5 in all upper case, indicating an officer. As we just
6 saw from the Canada Broadcasting case, Her Majesty can
7 only be legally present in Canada through her office,
8 and/or her officer, which is the Governor General of
9 Canada. Her Majesty the Queen, styled all in upper case
10 letters, must be Queen Elizabeth as an officer. It
11 appears the Crown changed my name in their motion to
12 William Russell, all upper case, and to identify me as
13 an officer for the six laws.
14 What are the advantages to Canada to use
15 such a federal officer for the six laws? The summary
16 below seems to describe how the Income Tax Act operates,
17 and therefore supports my position.
18 One, the officer links the six laws. For
19 example, accepting GST credit is also accepting the
20 Canada Pension Plan and Income Tax Act office, since
21 they are all the same offices as the Excise Tax GST
22 office.
23 Two, as the officer handles public --
24 Canada’s public money, it imposes fiduciary duties on
25 the officer to report accurately and on time Canada’s
26 public money.
27 Three, as the officer handles public
28 money, books and records are Canada’s property.
Vancouver, B.C. 32
1 Four, as the officer handles Canada’s

2 public money, the law imposes severe penalties for
3 breach of fiduciary duties on the officer if he fails to
4 report accurately and on time Canada’s public money,
5 including perhaps charged with fraud against the public.
6 Five, the theft of tort of conversion,
7 spending Canada’s public money without Canada’s
8 permission, is a Criminal Code offence where innocence
9 is no excuse. That means that taxpayers charged with
10 income tax offences cannot get off by pleading that they
11 did not -- that they did not understand the Income Tax
12 Act even if it is as Vern Khrisna said, mind-numbling
13 [sic] complex.
14 Six, the tort of conversion is one of
15 strict liability that fits with the Tax Court of Canada
16 not being a court of equity.
17 Seven, as the officer handles Canada’s
18 public money, even if the officer is charged and found
19 not guilty of tax offences, Her Majesty can still
20 recover her public money through Tax Court of Canada
21 through disgorgement from the officer.
22 There are three ways, A) accounting of
23 the profits once the profit is determined through the
24 accounting the defendant must surrender it. B) waiver
25 of tort instead based the claim on the recovery of the
26 public money. C) constructive trust, so any third party
27 owing the money to the offending taxpayer must pay any
28 money destined to the offending taxpayer instead to
Vancouver, B.C. 33
1 Canada. This fits the legal basis for a requirement to

2 pay, and corroborates my position, the officer is also a
3 trustee.
4 Eight, disgorgement from the officer also
5 means Canada does not have to prove in court that a
6 monetary loss actually occurred.
7 Nine, it allows the law to give and amend
8 at any time, privileges unique to the office, such as
9 the ability to deduct certain expenses as per Income Tax
10 Act section 18(1)(a). Canada allows the law to give and
11 amend at any time, benefits unique to the office, such
12 as various trial tax credits, low income tax credits,
13 housing credits, et cetera.
14 Eleven, the individual much like a
15 limited company de facto director can be treated as a de
16 facto officer if it may be implied from the
17 circumstances that one wishes to be an officer such as
18 accepting any benefit or privilege unique to that
19 office.
20 Twelve, as the owner of the private
21 property is the only one who can convert his private
22 property into public money by consenting to be in Canada
23 Pension Plan, Income Tax Act or an Excise Tax officer,
24 by “filling the office”, if he accepts any benefits or
25 privileges of the office, it may be implied from the
26 circumstances that he consents to being such an officer.
27 Thirteen, the officer for the sole office
28 links the six laws so that the public money related to
Vancouver, B.C. 34
1 the six laws all go in and out of the consolidated

2 revenue fund. This allows any public money owed by the
3 taxpayer from any of the six laws can be settled with
4 credits or benefits, and it was just called the right of
5 set off, from any one of the other six laws.
6 Fourteen, as all Canadians are deemed by
7 the Income Tax Act to be officers handling public money,
8 with the consolidated revenue fund, and most Canadians
9 have assented to be illegally liable through obtaining a
10 social insurance number from services Canada, CRA can
11 assess an individual who has agreed to be liable with
12 failure to comply with a requirement to pay on the third
13 party.
14 Fifteen, the office/officer could explain
15 taxation and worldwide income since the office is always
16 domiciled in Canada, regardless of where in the world
17 the officer earns the office’s income. As the office
18 and the officer are conceptually divisible but legally
19 indivisible.
20 Sixteen, as the officer is an artificial
21 person, there are no human rights for an individual as
22 an officer. The Canada Charter of Rights and Freedoms
23 does not apply. It also gives a possible reason why
24 CRA’s taxpayer's bill of rights does not have to be or
25 is not statute law.
26 Seventeen, taxing an officer’s income
27 does not violate that individual’s human right to
28 private property since it is not his property, but
Vancouver, B.C. 35
1 Canada’s public money.

2 Eighteen, if the income tax can be
3 imposed directly on an individual’s private property
4 without violating the common law right to private
5 property, there would be no need to have individuals
6 represent a federal entity such as a Canadian Pension
7 Plan, Income Tax Act or an Excise Tax Act officer.
8 Nineteen, the final Financial
9 Administrative Act confirms a fee may be charged by
10 Canada for use of benefits and privileges, such as those
11 attached to an office. This fee can be the income tax.
12 It follows that if one declines the use of such an
13 office as I did, and since there is only one income tax
14 rate scale, the Income Tax Act must deem income earned,
15 not for such an office to be equal to zero, and that is
16 what the Income Tax Act section 2.2, section 3, section
17 18(1)(a) and section 18(1)(c) does.
18 And twenty, income tax is an internal tax
19 since it is a tax for using the privileges of the
20 Federal Canada Pension Plan, Excise Tax Act and Income
21 Tax Act office that in internal to the Government of
22 Canada.
23 I will now address the case law used by
24 the Crown to support their motion to strike. Tuck
25 corroborates my position that being deemed by the Income
26 Tax Act as an officer is not just by the Income Tax Act
27 section 6(3), it is also by Income Tax Act section
28 152(7).
Vancouver, B.C. 36
1 "An assessment is not dependant on a return

2 or information supplied by the taxpayer."
3 In contrast at Tuck, my position is
4 income tax obligations are not a contract. So they're
5 not a contract but a deemed fiduciary obligation. I am
6 subject to the taxation laws and the deeming that
7 individuals represent a Canadian Pension Plan, Income
8 Tax Act and Excise Tax Act officer, stands if not
9 declared otherwise, as happened to Tuck. And I did file
10 a tax return or tax returns.
11 Therefore my position was zero on common
12 to Tuck, and I agree with the court that to hear his
13 case would be a waste of time. In contrast to Hovey, I
14 am liable as I agreed to be a legal representative and
15 the liability extends to third party demands such as a
16 CRA requirement to pay since the income of all such
17 officers are pooled together into the consolidated
18 revenue fund, which is not the private property of any
19 of the parties involved but is Canada's public money. I
20 am not claiming to be acting in his capacity as a
21 natural person, per Hovey, i.e. claiming not subject to
22 pay taxes under the Income Tax Act. I concur with the
23 court in Hovey that in my view the natural person
24 argument is without merit, as Hovey's meaning of natural
25 person is different from any meaning of natural person
26 as I used it in my private contract.
27 In contrast to Reid, I agree the laws of
28 Canada, including the Income Tax Act, apply to
Vancouver, B.C. 37
1 individuals and are why I filed a return of private

2 property income received as an individual in addition to
3 at T1 filed for the office income. I also believe it is
4 not involuntary servitude, as my position shows that the
5 Income Tax Act let's individuals override the deeming in
6 the Income Tax Act to be working as officers. I have
7 already addressed my belief that it is not a contract.
8 I concur with the court in Reid that it is an abuse of
9 process in this court.
10 In contrast to Cassa --
11 JUSTICE: Could you just wait a
12 second, there was just something that caught my eye. In
13 number 27 that you read from, you said in contrast in
14 Reid, "I agree the lost can, including the Income Tax
15 Act, apply to individuals and are why I also filed a
16 return for the private property income received as an
17 individual, in addition to the T1 filed for office
18 income."
19 DR. RUSSELL: Yes.
20 JUSTICE: So are you saying your filed
21 two returns?
22 DR. RUSSELL: I filed my officer's
23 income on the T1 and my private property I filed in a
24 letter to CRA.
25 JUSTICE: Okay, so it's not a return,
26 it's a letter that you sent to CRA?
27 DR. RUSSELL: It wasn't in a -- well,
28 yes.
Vancouver, B.C. 38
1 JUSTICE: Okay.
2 DR. RUSSELL: A letter identifying.
3 JUSTICE: Okay, I just --
4 DR. RUSSELL: In contrast to Cassa,
5 neither the Tax Court of Canada nor the Crown said that
6 my pleadings do no comply with the Tax Court Rules, TCC
7 rules.
8 As for the so-called detach language
9 listed, I have not used any in my pleadings and concur
10 with the court in Cassa that this court should instead
11 hear those self-represented litigants who are making an
12 honest attempt to advance the appeal through the court
13 system in a timely manner. Instead of having this court
14 waste their time on the scandalous and frivolous motion
15 to strike, which is a clear abuse of process.
16 In contrast to Bertucci, I have stated
17 that the Income Tax Act applies to me as an Income Tax
18 Act person. In fact as multiple Income Tax Act persons,
19 as an individual, as a legal representative, as an
20 officer who is a director of my limited company, and as
21 another officer for the purposes of the six laws, and
22 probably also as a trustee. I concur with the court
23 that there are absolutely no merit to any of his
24 arguments.
25 I will now comment on Crown's written
26 representations. Paragraph 11, refers to Meads, a
27 divorce court where the judge spent 160 pages out of 180
28 decision or 89 percent of the decision as an obiter
Vancouver, B.C. 39
1 aside about OPCA litigants. While I agree with the

2 majority of what the judge said in Meads, my position is
3 not derived from any of these so-called OPCA litigants
4 listed in Meads.
5 Paragraph 12 refers to the Bekensinski
6 case. Bekensinski was found guilt of tax evasion as he
7 accepted deductions for the Canada Pension Plan, Excise
8 Tax Act and Income Tax Act office as summarized by
9 spreadsheets by CRA lead investigator Tony Bronkey, a
10 Certified General accountant. The spreadsheet summaries
11 are permitted through the Shield case if done by a
12 professional accountant. But Bronkey testified not as
13 a CGA but as so called "fact witness". This would make
14 the spreadsheet summary inadmissible, but Bekensinski
15 accepted the proposed deductions so it was implied from
16 the circumstances that he became a de facto Canada
17 Pension Plan, Excise Tax Act and Income Tax Act officer
18 and so had to pay CPP, GST and income tax for using the
19 benefits and privileges associated with the office.
20 The judgment even reproduced the
21 spreadsheet of the deductions offered by CRA and given
22 the facts admitted by Berensinski in his case, I agree
23 that he was guilty. However, while some facts of my
24 case are similar to Berensinski, I declined all benefits
25 and privileges associated with the office. So there is
26 nothing that may be implied from the circumstances that
27 I intended to be such an officer. The Crown again
28 erroneously claims that I believe such income to be
Vancouver, B.C. 40
1 exempt from taxation. I have already addressed their

2 false statement earlier.
3 Paragraph 13 refers to Meads, which
4 discusses other peoples beliefs that absence of consent
5 provides a taxpayer with immunity from these legal
6 obligations. In contrast I am not opting out of my
7 legislative obligations as I have already stated that
8 the law applies to me. I'm not saying that becoming an
9 officer is as contractual obligation. The opposite may
10 be implied -- the opposite actually may be implied from
11 the circumstances. And the consent reference in Meads
12 at paragraphs 379 to 416, is about being subject to the
13 law and the Courts, which I am subject to. And not
14 about assent to being deemed to be a Canada Pension
15 Plan, Income Tax Act or Excise Tax Act officer for six
16 laws.
17 In fact Meads has actually zero reference
18 to my position. In addition, one, the Income Tax Act
19 permits one to decline the deeming to be such an
20 officer. Two, if it is compulsory then the Income Tax
21 Act would have used the word "shall", which is an
22 imperative, and no the word "deemed" over 3600 times.
23 This is from the composition of legislation,
24 "It is used to establish legal fictions.
25 For a statutory purpose, it is often
26 necessary to deem a thing to be something it
27 is not."
28 And three, due to the fiduciary duties
Vancouver, B.C. 41
1 imposed on an officer handling Canada's public money the

2 law cannot compel one to be such an officer, or as the
3 saying goes, you cannot thrust a trust.
4 And four the Crown's position that Rave
5 is wrong about income being -- income tax being an
6 involuntary servitude also corroborates my position that
7 it is voluntary to be an officer for the six laws.
8 Paragraph 14 also refers it to me
9 stating, "Canadian law does not provide a person to have
10 two aspects". This is on the Courts conclusion in
11 Stanchfield, I agree that this is a correct statement
12 based on the unique facts of that case. Since
13 Stanchfield was unable to provide the court with any
14 case law, legal references or even a possible theory as
15 to how his second capacity is created, or this second
16 capacity is created, who created it, what the
17 characteristics of the second capacity are and how it is
18 identified in writing. So the Court correctly -- ruled
19 correctly that there was no evidence before the Court
20 that an individual can have a second capacity for the
21 purposes of the six laws.
22 In contrast, I figured out how the second
23 capacity, the Canada Pension Plan, Income Tax Act and
24 Excise Tax Act office was created, who creates it, what
25 are the characteristics of this officer are and how it
26 is indentified in writing. This is also CRA's tax
27 protester position three, which I addressed in my notice
28 of objection.
Vancouver, B.C. 42
1 I really think we don't need to flog a

2 dead horse. As I mentioned earlier, the Court Sheriff,
3 the Crown, the Judge and Her Majesty the Queen are all
4 present in court in their capacities as various
5 officers. Her Majesty the Queen, the legal equivalent
6 of all Canadians, has two capacities to be legally
7 present in Canada. And the Crown admits that I am in
8 court as an officer, as a director of my limited
9 company.
10 Ironically Judge Cobach in Meads could
11 only make such statements while in his capacity as a
12 court officer. Recall that the CRA lead investigator
13 Tony Bronkey from the Periski case can be a certified
14 general accountant or not at any time. My position is
15 that one can be an officer or not at any time.
16 For example, on April the 7th, 2016, Jody
17 Wilson-Raybould spoke at a $500 a plate dinner hosted at
18 a Bay Street law firm. After both Canadians and the
19 press questioned whether there was a conflict of
20 interest, Ms. Wilson-Raybould claimed that she attended
21 the dinner not in her capacity as Attorney General or as
22 a Minister of Justice, both office number one, but only
23 as a member of parliament, office number 2. She
24 attended parliament the next day, back as Minister of
25 Justice, Attorney General of Canada, and Member of
26 Parliament. It follows that I can also be an officer or
27 not be that officer at any time.
28 Paragraph 23, the Crown states that the
Vancouver, B.C. 43
1 appellant failed to report material amounts of income

2 from the company in each taxation year under appeal.
3 This is false as all income was reported. Canada's
4 public money on T1s and private property income by
5 letter. I was not charged with tax evasion or with
6 false information on return. And since 1991 a T1 form
7 no longer says it is authorized by the Minister of
8 National Revenue. And in the Gibbs case at tab 9 of my
9 book of authorities, "The Crown conceded that there is
10 no documentation whereby the Minster expressly
11 authorized the form." And the Income Tax Act does not
12 say a return shall be filed only on a T1.
13 I have concluded that a T1 is the
14 suggested form that a taxpayer can elect to use and is
15 for reporting only Canada's public money received for
16 her office that is identified with the all lower case
17 social insurance number. This is why I had to report my
18 private property income received not as an officer, by
19 letter with the other SIN, the social insurance number
20 upper and lower case, identifying me as being liable as
21 a legal representative. And once again all my income
22 was reported in prescribed form.
23 At paragraph 23, the Crown also says the
24 appellant was aware of his obligation to report taxable
25 income. With all respect, all taxable income was
26 reported. I believe that what the Crown wants is my
27 exempt income, my private property, to be consensually
28 converted by me into taxable income as public money for
Vancouver, B.C. 44
1 their office, just like what the court said in their

2 introduction to their decision in the Redpath tax
3 evasion case, which is under tab 10 in my book of
4 authorities, where the taxpayer -- where those taxpayers
5 like me had also declared all income.
6 And it quotes:
7 "As already noted and underlined, the
8 original charge of omitting to declare
9 income was later amended at the request of
10 the Crown and at the defence stage by
11 judgment of the trial court over the
12 objections of the defence by adding the word
13 "taxable" to the word "income".
14 For what it would have been worth, for the
15 sake of clarity and to reflect the true
16 nature of the charge, if such a charge
17 exists in law and in my review of the tax
18 returns filed and their manner of filing in
19 the evidence adduced, it might have been
20 more factual to couch the information and
21 state in the charge by omitting to declare
22 income as taxable income."
23 Stanchfield, a former Paradigm Educator,
24 plea bargained his tax evasion and fraud charges down to
25 one count each, and CRA's November 26, 2015 press
26 release on the plea bargain carefully noted that the
27 Paradigm Education Group, the author of my private
28 contract, taught how to restructure their affairs to
Vancouver, B.C. 45
1 avoid paying income tax. The Crown's restriction that

2 all income is taxable income fundamentally violates
3 Canada's common law right to private property for
4 individuals who are not officers. If all property
5 belongs to Canada as her public property and as her
6 public money, then Canada as a communist government
7 would -- in fact is building a memorial to the victims
8 of communism in Ottawa near the Supreme Court of Canada.
9 In contrast, my position agrees that all
10 income is subject to taxation, but that not all income
11 is taxable income, which gives Canada the best of both
12 worlds. The flexibility to legally tax Canada's Canada
13 Pension Plan, Income Tax Act, and Excise Tax Act office
14 income while respecting common law rights to private
15 property.
16 As I have given examples of how my
17 position makes sense, and as my position does not
18 disagree with any of the CRA's ten so-called tax
19 protester positions, and as the law supports my position
20 it is the Crown's motion that is nonsensical, completely
21 without merit, and demonstrative of the Crown's
22 indifference as to whether Canada complies with common
23 law and international laws on private property rights or
24 not.
25 The Crown is asking for gross negligent
26 penalties where no legal basis exists. The Supreme
27 Court of Canada said in Hodgkinson and Simms, "This was
28 a case of material nondisclosure in which the appellant
Vancouver, B.C. 46
1 alleged breach of fiduciary duty and breach of contract

2 against the respondent in the performance of a contract
3 for investment advice and other tax‑related financial
4 services."
5 The respondent's behaviour calls for
6 strict legal censure. The remedy of disgorgement is not
7 sufficient to guard against the type of abusive
8 behaviour engaged in by the respondent. The law of
9 fiduciary duties has always contained within it an
10 element of deterrence. I make this point because an
11 allegation of breach of fiduciary duty carries with it
12 the stench of dishonesty. If not in deceit, then of
13 constructive fraud."
14 As per Hodgkinson and Simms, above, there
15 could be penalties and fraud charges if there was
16 failure to, in a fiduciary duty reporting Canada's
17 public money accurately and on time, but obviously there
18 can be no penalties for mismanaging one's own property.
19 As I reported all income, private and
20 public, and as I never assented to convert my private
21 contracts, private property into Canada's public money,
22 as I did not accept any benefits or privileges related
23 to the Canada Pension Plan, Income Tax Act, and Excise
24 Tax office, so it could be implied from the
25 circumstances that I wish to fill such an office, no
26 fiduciary duty is owed to the public nor any fraud is
27 committed against the public, so no element of
28 deterrence such as gross negligent penalties are
Vancouver, B.C. 47
1 applicable since my property stayed private and never

2 became Canada's public money.
3 As I have just demonstrated that it is
4 Crown's motion to strike that is frivolous, vexatious,
5 and abuse of process, I submit that the Crown's motion
6 to strike be dismissed.
7 In addition I submit that my amended
8 Notice of Appeal I made on February 27, 2016, not be
9 struck at all but to stand as whole. And my property --
10 as my property received under the private contract
11 remain as my private property and never became Canada's
12 public money. I submit that the Crown's motion for
13 gross negligence penalties be dismissed. And for these
14 reasons costs should be awarded to the appellant.
15 JUSTICE: Thank you. Did you want to
16 address, Ms. Raddysh --
17 MS. RADDYSH: Raddysh, ma'am.
18 JUSTICE: Did you want to address your
19 -- the motion to dismiss with respect to your appeal?
20 MS. RADDYSH: My appeal is directly in
21 result of my spouse.
22 JUSTICE: Okay. Thank you. I just
23 wanted to give you an opportunity to speak if you had
24 wanted.
25 MS. RADDYSH: Thank you.
26 JUSTICE: Okay. Mr. Matas, please?
27 MR. MATAS: Nothing in reply. Thank
28 you.
Vancouver, B.C. 48
1 JUSTICE: Okay. Okay, I will reserve

2 my decision and I'll issue a written decision in this
3 matter. Okay. Thank you.
4 (PROCEEDINGS ADJOURNED AT 10:49 A.M.)
5
6
7 August 25th, 2016

Tab O
Russell Letter
to CRA
re:
CRA’s Proposal to
Convert His Private
Property

William Russell
14028-23A Ave
Surrey, BC, V4A 9V3

Surrey Tax Centre
9755 King George Boulevard
Surrey, BC V3T 5E1

August 24, 2016

Dear Sir/Madame

Re: Statement of Account for social insurance number

In your Statement of Account dated August 10, 2016 with “social insurance number”
, you reinstated taxable amounts of $ ,000, $ ,000, and $ ,000
for 2010, 2011, and 2012 taxation years. I appealed these assessments to the Tax
Court of Canada. Crown motioned to strike my appeal. The Court granted Crown’s
motion (“Order”). The Order is Russell v. The Queen, 2016 TCC 122 (see attached).
However, the Order does not mean the amounts are taxable income. It means they
are not taxable income.

The amounts were received by me under a “Contract for Hire” (“CFH”)1, which states
it is my private property. Being my private property, it qualifies as “exempt
income” as defined by s. 248(1) of the Income Tax Act (“ITA”). Exempt Income is
deemed to be equal to zero by ITA s.3(f). It is then taxed with the same income scale
as taxable income. If it were otherwise, Her Majesty (or Her agents) would be
committing either theft or conversion. Both are Criminal Code offences2.

No Grounds to Appeal the Order

I could not appeal the Order because:

1) There was no error in finding of fact, as the Order stated in paragraph [5], “
the facts alleged in the pleading are assumed to be true,” and “ in making the
decision whether to strike the Amended Notice of Appeal or paragraphs in it, I
cannot review any evidence.”

1 Appendix B in my Amended Notice of Appeal
2 Criminal Code, s. 322(1) and s.279
1
2) There was no error in finding of law, since the Order is legally correct when
applied to the “facts” used (but which are opposite to my pleading’s facts.)

As I had no grounds to appeal the order, it is binding on both parties, including the
Order’s statement that “ the facts alleged in the pleadings are assumed to be true.”

My Facts Assumed to be True

In it’s Reasons for Order, the Court said:

[5] When considering a motion under section 53 of the Rules, the facts alleged
in the pleadings are assumed to be true: Operation Dismantle v. Canada,
1985 CanLII 74 (SCC), [1985] 1 SCR 441 at 455…… In making the decision
whether to strike the Amended Notice of Appeal or paragraphs in it, I
cannot review any evidence.

This is critical, since the facts I alleged in my pleadings are diametrically opposite
to the misquoted “facts” used by the Court to justify striking my appeal.

Misquoted “Facts” by Tax Court of Canada

1) In paragraph [11] the Court missed the CFH clearly stating the income
received under it is my private property.
2) In paragraph [22], the Court stated I had “a belief that every binding legal
obligation emerges from a contract, and consent is required before an
obligation is enforced.” THIS IS FALSE. I said the opposite: legal obligations
can arise from fiduciary duties, see paragraph [18](g). I pointed out in my
oral presentation to the Court (see attached) , in my pleadings (see Court
Transcript pg. 36, Line 1-3 & pg.37, Line 4-5) , and my tax filings that this is a
“tax protestor” position I do not subscribe to.
3) In paragraph [22], the Court stated I “opted out of being taxed” THIS IS
FALSE. Private property fits the ITA definition of “exempt income”. Exempt
Income is taxed at the same rate as taxable income. As I pointed out in
my oral presentation to the Court, in my pleadings, and in my tax filings this
is a “tax protestor” position that I do not subscribe to either.
4) In paragraph [23], the Court stated I argued that I “exist in two separate
states”. THIS IS FALSE. As I pointed out in my oral presentation to the Court,
in my pleadings, and in my tax filing this is a “tax protestor” position that I do
not subscribe to. Instead, I said I could exist as two separate persons in law,
just like, (as I read into Court), the judge, the court sheriff, the Crown, and
HER MAJESTY THE QUEEN. Furthermore, the judge could not have rendered
the Order unless she existed as a second person in law, as a judge (court
officer).
5) In paragraph [25] and [28], the Court said, “the Appellant has admitted the
he received $ ,00, $ ,000, and $ ,000 in 2011, 2011, and 2012 which
he did not include in his income tax returns for those years” THIS IS FALSE.
2
I reported those amounts in my income tax returns by letter, as mentioned in
the Order in paragraph [12]. Nowhere does the ITA say a return can only be
on a T1.

The True Facts in My Pleadings, Audit, and Filings

The facts I alleged in my pleadings (see attached), which the Order and the Supreme
Court of Canada says must be “assumed to be true”, are:

1) The Contract for Hire (CFH) states clearly in writing the income I received is
my private property. A copy of my CFH was submitted during the audit.
This claim was repeated in my pleadings and my oral statement in Court.
2) In my filing of private property income by letter, I compared my position
with all ten CRA “tax protestor” positions on your website. None are the
positions that I take (see Chapter 45, “Compare to CRA Alert on Tax
Protestors: Theory Validated?”)
3) In my oral statement, I also agreed with all of Crown’s “tax protestor” case
law, as my position is diametrically opposite to “tax protestor” positions,
including the so-called “natural person” concept (see Court Transcript, pg.36,
Line 17-19).
4) Since I claimed the income I received under my CHF as my private property,
that income is not Canada’s “public money” as defined3 by the Financial
Administrative Act.
5) I filed all my income received under the CFH by letter with my “Social
Insurance Number” styled in upper and lower case.
6) I also reported all the income I did not receive under my CFH on CRA’s T1,
which uses the “social insurance number” styled in all lower case.
7) I reported all individual taxpayer income: the income I received under the
CFH plus the income I received from sources other than under the CFH.

In summary, all the so-called “facts” used to grant Crown’s motion to strike are
diametrically opposite to the true facts in my pleadings. Applying these true facts,
which the Order and the Supreme Court of Canada says we must, there is no basis
left for granting Crown’s motion to strike.

Income Under CFH is Private Property

The Federal Court of Appeal has held that an income tax appeal does not initiate
legal proceedings, but rather represents the trial stage of an appeal procedure4. We
are bound by the Order, which says, “ the facts alleged in the pleadings are assumed
to be true”: income I earned under the CFH is my private property , that income is
not Canada’s “public money”, and I reported all my income . However, your August

3 “Public money” as defined by the Financial Administrative Act, s. 2.
4 Queen v. Sarraf, 94 DTC 6229 (F.C.A.), endorsing the reasons for decision of Jerome,
A.C.J. in 460354 Ontario Inc. v. The Queen, 92 DTC 6534 at 6535
3
2016 Statement of Account proposes I legally convert my private property into
public money for Canada, as you use the SIN as a “social insurance number” instead
of as a “Social Insurance Number”…. as explained in paragraphs 14 and 16 of my
submissions attached. As stated multiple times before, I have no intention of
converting my private property into public money. I once again claim my property
as private, as my CFH clearly states and I decline the deeming in the tax laws that it
is Canada’s “public money”.

No Grounds for Gross Negligence Penalties

The Order and the Supreme Court of Canada says, “ the facts alleged in the pleadings
are assumed to be true”. I also pleaded I reported all income. Therefore, when the
true facts are substituted for the incorrect “facts” in paragraph [28] of the Order, the
material facts necessary to prove gross negligence penalties are missing. There are
no grounds or evidence for gross negligence penalties.

Summary

My income received under the CFH is my private property. As I do not wish to
convert it into “public money” for Canada, CRA, by placing these amounts on the
Statement of Account with a “social insurance number”, is committing conversion.
As I pointed out in my oral presentation in Court, converting private property into
Canada’s “public money” (other than by the owner) is a Criminal Code offence.

Yours sincerely,

William Russell

Does Russell Tax Court Order Validate Apus Theory?

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Does Russell Tax Court Order Validate Apus Theory?

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Does the Russell

Tax Court Order

“Apu’s Theory, Part 4”

Apu Nahasapeemapetilon, Ph.D. (Caltech)

Background, Authorship, and Copyright Notice A

Analysis – aka “Apu’s Theory, Part 4” B

Russell - Notice of Objection to CRA1 C

CRA – Reassessment’s Notice of Confirmation D

Russell – Notice of Appeal (“Pleadings”) to TCC2 E

Russell – Notice of Appeal – Book of Authorities F

Russell – Notice of Appeal – Book of Documents G

DoJ3 – Intro Letter; Motion to Strike H

Russell – Why Appeal Not Frivolous nor Vexatious I

DoJ – Motion to Strike – Written Representations J

DoJ - Motion to Strike – Book of Authorities K

Russell – Motion to Strike – Oral Submission (1 hour) L

TCC Order Transcript N

Russell – Response to CRA Statement of Account O

Authorship and Copyright Notice

Does the Russell Order Validate Apu’s Theory?

Why the Court Shenanigans?

Russell Filed Using Apu’s Theory

Russell is an alternative health care professional5 near Vancouver, British Columbia. He

Russell Not Charged with Tax Evasion

Court Orders Are Not Decisions

#1 Bad for Canada: (if Apu’s Theory is Correct)

From Canada’s viewpoint, TCC rules17 means these possible outcomes:

1) Motion to strike the case, block it from going to trial

Why You Need the Rest of the Story

Court’s Reasons For Striking Russell’s Appeal

Crown: Russell an “OPCA Litigant”

Crown claims Russell is an Organized Pseudolegal Commercial Argument litigant

Russell: Not “OPCA Litigant”

#2 Bad for Canada: Russell Winning Would Discredit Meads

#3 Bad for Canada: PEG Taxpayers Jailed Due to Non-Disclosure

Duhaime’s defines pleadings as:

That core document(s) of a party to litigation in which he or she formally sets

Crown’s Motion to Strike

The Crown’s written representation for their motion to strike is at Tab J.

Court Hearing on Motion to Strike

But Russell’s Pleaded Facts Must be Assumed to be True

8. An order to strike a Notice of Appeal in its entirety under Rule 53 is an extraordinary

Compare Russell’s Facts to TCC’s Facts

Russell’s Pleaded Facts “Facts” TCC Used for Order

Reported all income33. Admitted to excluding income in tax returns34.

Why Unreported ‘Income’ Not on a T1 is Not Always Tax Evasion

List of Forms and Diagrams

Russell’s Notice of Objection to CRA, at Tab C, included Apu’s Theory,

However, to save paper, we have omitted attaching the rest of Apu’s

REGISTERED Our file Notre reference

Account Number - Numero cle compte

Your objection is disallowed and the assessments are confirmed.

Dated at the city of Vancouver, this £rp 2 5 20Vu

TAX COURT OF CANADA

HER MAJESTY THE QUEEN

A. Appellant's Address: Avenue

B. Assessment Under Appeal:

C. Material Facts Relied Upon

ITA "Employed" and ITA "Employment" Income(s) Reported on Tls

ITA "Employment" Source of Income from an Office

7. The amounts received were reported by the Appellant as income from an

Income Under Private Contract Reported by Letter

Income Earned Under Private Contract Reassessed as if Made by CPP/ITA Officer

23. The Minister confirmed his reassessment of the Appellant's 2010­2012

23. The Minister confirmed his reassessment of the Appellant's 20102012

i. INS3166 Request for Record of Employment the legal representative

x. T2125 income for such an office from business

Individuals present at meeting: D S director

whose mailing address is C/O

and C / a:a w /fc^Ae !( , an individual ("Agent").

whose mailing address is C/O f Zz_C.„..