Keith David Lawson - Poriskyite Tax Evader

[notorial dissent]

That is what I had wondered. It sounded like they had gotten the whole bunch of them, but tax scams here have a way of being reborn or tre-titled and coming back from the grave. It doesn't sound like this one will, since it is the "private person" argument they were hinging on and the Canadian courts do seem to have really and publicly stomped on that one. I'm sure as you say that there are others still wending their way through the courts considering the numbers we're talking about, and I'm sure a few will drag out for as long as they can that just being the nature of tax cases.

[The Observer]

The other shoe to drop though is some other two-bit scammer picking up the Porisky Doctrine, altering it a bit, and then peddling it to another generations of greedy marks.

[Burnaby49]

And he's out on bail. Granted October 31st. I checked his new appeal file online. He's case number CA44027 and he filed an appeal Oct, 31, no hearing yet scheduled. He is currently unrepresented.

In addition both Russell Porisky and Elaine Gould filed appeals on August 25th. It will be interesting to see what grounds they, and Lawson, state for their appeals.

[grixit]

I don't think his health is that much of an issue. He's going to white collar prison. They can send a specialist once a week to deliver fresh catheters and antibiotics and collect a urine sample. They can have his cell disinfected every day while he's at lunch. If things get worse he can get a weekly escort to the hospital for dialysis. There are plenty of prisoners all over the world who'd gladly trade.

[Burnaby49]

Yesterday morning I went to the British Columbia Court of Appeal registry in downtown Vancouver and got copies of Keith Lawson's and Russell Porisky's Notice of Appeal or Leave to Appeal. These give the basic information required to get an appeal of a court decision in motion and, critically, they give the appellant's grounds for appeal.

I've posted the basis of Russ Porisky's grounds for appeal here;

viewtopic.php?f=50&t=10485&start=40#p236184

This is Keith's last chance to save himself from jail time and he's gone off the rails in a doomed double-or-nothing suicide run. He's discarded all of his baggage from the past. He's abandoned capitalization, jurisdiction, even his beloved natural man, and is gambling everything on one last throw. He's going to convince the British Columbia Court of Appeal that the Supreme Court of Canada has told him that he could exempt himself from paying income tax by declaring his Paradigm income to be derived from a tax-free hobby.

So he hasn't evaded tax or counseled tax evasion because he never owed any income tax in the first place and the people he counseled were just hobbyists like himself. He was just diligently following the law which only he, with his genius for legal analysis, is able to comprehend. Hopefully the judges at his appeals court hearing are intelligent and learned enough to finally understand how the law really works after he explains it all to them.

He's relying on his totally deluded interpretation of the Stewart decision. I've already discussed Stewart in detail in this discussion and explained why Lawson is entirely wrong in his interpretation of it but, since it is apparently the hill that he's chosen to die on, I'll go through it one more time.

This is the Stewart decision;

Stewart v. Canada, [2002] 2 SCR 645, 2002 SCC 46
http://canlii.ca/t/51sg

This is what I said in my posting on May 3, 2016;

This was a Supreme Court of Canada case about REOP (Reasonable Expectation of Profit). Up until Stewart the CRA could reassess someone on claimed business losses if the CRA auditor thought that the business did not have a reasonable expectation of profit. A purely subjective conclusion on the part of the Auditor. In Stewart a real estate investor lost money year after year on some rental apartments he owned because they were very highly levered and interest expenses exceeded the rent. He claimed losses and was reassessed on the basis he had no expectation of profit.

This is how the Supreme Court explained the decision

The appellant, an experienced real estate investor, acquired four condominium units from which he earned rental income. The properties were part of a syndicated real estate development, and were sold on the basis that the purchaser would be provided with a turnkey operation, that management would be provided, and that a rental pooling agreement would be entered into. All units were highly leveraged with the appellant paying only $1,000 cash for each unit. The appellant was provided with projections of rental income and expenses in respect of each of the properties. The projections contemplated negative cash flow and income tax deductions for a ten year period. However, the actual rental experience ended up being worse than what had been set out in the projections. For the taxation years 1990 to 1992, the appellant claimed losses, mainly as a result of significant interest expenses on money borrowed to acquire the units. These losses were disallowed by the Minister of National Revenue on the basis that the taxpayer had no reasonable expectation of profit and therefore no source of income for the purposes of s. 9 of the Income Tax Act, and that the interest expenses were not deductible pursuant to s. 20(1)(c)(i) of the Act. Both the Tax Court of Canada and the Federal Court of Appeal upheld the decision.

Held: The appeal should be allowed.

The “reasonable expectation of profit” test should not be accepted as the test to determine whether a taxpayer’s activities constitute a source of income for the purposes of s. 9 of the Income Tax Act. In recent years, this test has become a broad based tool used by both the Minister and courts independently of provisions of the Act to second guess bona fide commercial decisions of the taxpayer and therefore runs afoul of the principle that courts should avoid judicial rule-making in tax law. The test is problematic owing to its vagueness and uncertainty of application; this results in unfair and arbitrary treatment of taxpayers.

The following two-stage approach should be employed to determine whether a taxpayer’s activities constitute a source of business or property income: (i) Is the taxpayer’s activity undertaken in pursuit of profit, or is it a personal endeavour? (ii) If it is not a personal endeavour, is the source of the income a business or property? The first stage of the test is only relevant when there is some personal or hobby element to the activity. Where the nature of an activity is clearly commercial, the taxpayer’s pursuit of profit is established. There is no need to take the inquiry any further by analysing the taxpayer’s business decisions. However, where the nature of a taxpayer’s venture contains elements which suggest that it could be considered a hobby or other personal pursuit, the venture will be considered a source of income only if it is undertaken in a sufficiently commercial manner. In order for an activity to be classified as commercial in nature, the taxpayer must have the subjective intention to profit and there must be evidence of businesslike behaviour which supports that intention. Reasonable expectation of profit is no more than a single factor, among others, to be considered at this stage.

The deductibility of expenses, which presupposes the existence of a source of income, should not be confused with the preliminary source inquiry. Once it has been determined that an activity has a sufficient degree of commerciality to be considered a source of income, the deductibility inquiry is undertaken according to whether the expense in question falls within the words of the relevant deduction provision(s) of the Act. To deny the deduction of losses on the simple ground that the losses signify that no business (or property) source exists is contrary to the words and scheme of the Act. Whether or not a business exists is a separate question from the deductibility of expenses. To disallow deductions based on a reasonable expectation of profit analysis would amount to a case law stop-loss rule which would be contrary to established principles of interpretation which are applicable to the Act. As well, unlike many statutory stop-loss rules, once deductions are disallowed under the “reasonable expectation of profit” test, the taxpayer cannot carry forward such losses to apply to future income in the event the activity becomes profitable.

In sum, whether a taxpayer has a source of income from a particular activity is determined by considering whether the taxpayer intends to carry on the activity for profit, and whether there is evidence to support that intention. In this case, the taxpayer purchased four rental properties which he rented to arm’s length parties in order to obtain rental income. A property rental activity which, as here, lacks any element of personal use or benefit to the taxpayer is clearly a commercial activity. As a result, the appellant satisfies the test for source of income and is entitled to deduct his rental losses. Section 20(1)(c)(i) of the Income Tax Act, which permits the deduction of interest on borrowed money for the purpose of earning income from a business or property, is not a tax avoidance mechanism and, in light of the specific anti-avoidance provisions in the Act, courts should not be quick to embellish provisions of the Act in response to tax avoidance concerns. In addition, since a tax motivation does not affect the validity of transactions for tax purposes, the appellant’s hope of realizing an eventual capital gain and expectation of deducting interest expenses do not detract from the commercial nature of his rental operation or its characterization as a source of income.

I'm guessing that Lawson wanted to use this as some kind of proof that, even if he made money from promoting Paradigm, he wasn't in business, it was a hobby and therefore not taxable. I'm assuming that he planned to rely on this sentence;

In order for an activity to be classified as commercial in nature, the taxpayer must have the subjective intention to profit and there must be evidence of businesslike behaviour which supports that intention.

To try and persuade the jury that he didn't have the subjective intention to profit, he was just helping his fellow truth-seekers and therefore he didn't have a business.

However Lawson has it backwards. The point of the Stewart decision wasn't that profits can be made non-taxable based on your claimed subjective intent but to allow business losses when you conducted yourself in a business-like manner. Mr. Stewart lost money on his apartment rentals which he applied against other income to reduce his taxable income from other sources. The CRA disallowed those losses on the basis he had no hope of making an operating profit from his apartments (as opposed to long-term capital gains) and the Supreme Court allowed him to have them on the basis that he ran a business-like operation, acted in a prudent business-like manner, and that it wasn't up to the CRA to decide whether or not he had a business.

However you can't flip this around when you are doing something that makes a profit, say by flogging Paradigm materials, and rely on Stewart to make the profits non-taxable by just claiming that you didn't intend to profit and you are actually just doing it as a hobby. The fact that you are acting in at least a basic business-like manner by selling a course of instructions and the accompanying materials at an amount in excess of your cost, contracting to perform duties for a client, invoicing for materials sold and services and making a profit from this is proof you have an actual business regardless of whatever you chose to call it.

I'm also guessing, from my seat in the stalls, that claiming that although he made a pile of money over the years it wasn't taxable just because he chose to call his endeavors a hobby didn't go down well with the jurors. A tactical mistake.

So let's go through Lawson's grounds for appeal. The first one is really, really stupid and we haven't even come to Stewart yet. I plan to paraphrase much of Lawson's grounds with the actual document put up on media Fire later but this deserves a full quote;

1. The Honourable Trial judge erred in entering a plea of guilty in the presence of stated position of the Appellant that he did not understand the charges and did not fail or refuse to enter a plea. The Trial Judge further erred in failing to explain the charges to the appellant at all, or alternatively, sufficient to permit the Appellant to understand them.

In other words if I claim that I'm too dense to understand the charges I can't be tried. Lawson was articulate and focused throughout his trial. He demonstrated a grasp of difficult concepts and argued the convoluted interpretations of law that formed his defense. But when faced with the task of understanding the charges against him he claims to have suddenly devolved into the village idiot. Any readers having unusual difficulty understanding the basics of these;

Count 1
Keith David LAWSON, at or near the City of Burnaby in the Province of British Columbia and elsewhere, between April 15, 2002 and August 26, 2010, did counsel various persons to commit the indictable offence of fraud in excess of five thousand dollars, contrary to section 380 of the Criminal Code and did thereby commit an offence contrary to section 464(a) of the Criminal Code.

Count 2
Keith David LAWSON, of the City of Burnaby, Province of British Columbia, between December 31, 2003 and May 1, 2009, did wilfully evade or attempt to evade payment of taxes imposed by the Income Tax Act in the amount of $46,176.20 for failing to report his taxable income in the amount of $213,213.13 for the 2004, 2005, 2006, 2008, and 2008 taxation years and did thereby commit an offence contrary to section 239(1)(d) of the said Act.

Keep in mind that Lawson had, literally, years between the charges being laid and his trial. Yet he purports to have arrived in court in a fog with no understanding of why he was being tried.

On to his second ground for appeal. This is a compound section based on errors by the judge in instructing the jury;

A - The Judge informed jury to use the ordinary meaning of income instead of it's legal definition.

This is his first venture into Stewart. Just a preliminary dipping of his toe in the waters.

B - Improperly instructing the jury to apply Section 9 of the income Tax Act against Lawson. This is Section 9;

9 (1) Subject to this Part, a taxpayer’s income for a taxation year from a business or property is the taxpayer’s profit from that business or property for the year.

(2) Subject to section 31, a taxpayer’s loss for a taxation year from a business or property is the amount of the taxpayer’s loss, if any, for the taxation year from that source computed by applying the provisions of this Act respecting computation of income from that source with such modifications as the circumstances require.

(3) In this Act, “income from a property” does not include any capital gain from the disposition of that property and “loss from a property” does not include any capital loss from the disposition of that property.

This argument relates to his interpretation of Stewart. As Lawson will flesh out later he didn't have "income" because he had money from a hobby which wasn't taxable under the Act. All approved by the Supreme court of Canada.

C - The judge did not instruct the jury that the legal definition of income was a question of law set out in Stewart.

D - More of this income bullshit and hints of how Stewart will save his ass by showing that he had no taxable income.

Ground 3 is a touch vague.

3. The jury's findings are unreasonable and unsupported by the required evidence. The jury was misled by the Court and the Crown.

Keith, some advice. That bald unsupported comment will count for nothing at your appeal hearing. You need to cite specific examples not just empty accusations. Give chapter and verse at your appeal hearing. I'll probably be there to record it for Quatloos.

His fourth ground is a favorite of mine. Since he was unrepresented it was the judge's job, and one she failed at dismally, to step in and act as his lawyer!

4. The Honourable Trial Judge failed to assist the Appellant to bring forth any or all of his defenses with full force.

This one is a perennial. When this appeal goes down in total defeat Keith can include, as part of his Leave to Appeal application to the Supreme Court of Canada, an argument how the appeals court judges also failed him by not acting as his lawyers either.

Then, in Count 5, we at last arrive at full-frontal Stewart. Number 5 while purportedly covering different issues in respect to the law was really one long complaint that he'd declared his income as coming from a non-taxable hobby but everybody ignored this. The opening says it all;

5. The Honourable Trial judge failed to properly apply the principles of law set out in Stewart v Canada, 2002 by;

Then a laundry list of the things the judge was too dense to understand. This was a personal endeavor, failing to consider his subjective intent, failing to tell the jury that the Crown had to prove that he knew he actually had a business when he actually made all of his money from his hobby.

And then this statement, breathtaking in both it's bone-headed wrongness and its arrogance in proclaiming and demanding new and absolute rights for himself. Rights which other Canadians don't realize they have because, apart from Lawson, we are all just too stupid to understand what the Supreme Court of Canada was telling us in Stewart.

c. failing to consider and apply the principles and findings by the Supreme Court of Canada that the determination of whether the activities of the Appellant are to constitute a personal endeavor and thus non-taxable or a business or other source of income which is taxable, is to be legally made by the Appellant, not the CRA, nor the Crown, nor the Court. Neither the CRA, nor the Crown, nor the Court has the power to override the Appellant's decision and intentions on this matter;

So we're down to magical incantations. If I declare my pensions to be derived from a hobby they are no longer taxable! Do I need an eye of newt and some henbane? I think I'll just hold back until after Keith's appeal hearing before I try it.

Keith, one nitpicking point about your opening statement in ground 5. If you are going for broke with Stewart you should really give the correct citation for it.

Stewart v. Canada, [2002] 2 S.C.R. 645, 2002 SCC 46

These little things matter when your case is being reviewed by the British Columbia Court of Appeal. It demonstrates at least a basic level of competence.

Number 6 is that the judge screwed up by saying he made income and profit. We're still on Stewart. Same with 7 where he claims that the judge erred in her interpretation of s. 464 of the Criminal Code, his counseling charge;

Counselling offence that is not committed

464 Except where otherwise expressly provided by law, the following provisions apply in respect of persons who counsel other persons to commit offences, namely,

· (a) every one who counsels another person to commit an indictable offence is, if the offence is not committed, guilty of an indictable offence and liable to the same punishment to which a person who attempts to commit that offence is liable; and
·
· (b) every one who counsels another person to commit an offence punishable on summary conviction is, if the offence is not committed, guilty of an offence punishable on summary conviction.

Because s. 464 only applies to commercial activities and he was involved in a hobby.

Number 8 is a querulous complaint about how the judge mistreated him and favoured the Crown. Continuous interruptions! Denial of evidence he wanted entered! Restricting his testimony "based on rules he didn't understand and which the judge did not fully explain and/or improperly applied". Keith, a point you should work on before your hearing. If you didn't understand the rules that the judge used against you how can you claim she applied them improperly? It's one or the other. The appeals court is going to want to know.

As a result of all of the endless, relentless interruptions he was prevented from fully presenting evidence and submissions in his defense. He lost focus and was extremely frustrated!

Part d was how the judge allowed the Crown to give incorrect, impermissible, and/or improper instructions to the jury. I must have missed something because I was there for jury instructions and I didn't see the Crown give any instructions to the jury, improper, impermissable or otherwise. Only the judge gave instructions. Since Keith also included the judge as a party misrepresenting things to the jury he can just switch his complaints about the Crown in this part to the real culprit, Justice Watchuk.

Then a part that deserves to be quoted in full. Everything should be thrown out because the Crown believed that he was guilty and wanted to obtain a conviction!

e. The Crown was prosecuting for improper purposes such as obtaining a conviction, indicative by such comments as inter alia referring to the Appellant as "Mr. Guilty", which comment did or could reasonably could be seen to have biased the jury. Such comments could reasonably have influenced the jury;

Actually that Mr. Guilty quote is true. Crown counsel was saying something to the effect that Mr. Lawson was guilty of whatever but instead said that Mr. Guilty was guilty. No wonder Lawson feels persecuted. How can the court of appeal not toss out Keith's convictions after finding out that Crown Counsel, the person prosecuting Lawson, told the jury that she thought Lawson was guilty?

The rest of number 8 is a confused complaint about failures by Crown and the Court to separate assumed facts from issues of law.

Point 9 speaks for itself;

9. The Honourable Trial Judge failed to consider and apply the initial test for commerciality as set out in Stewart, to the Appellant's activities.

Number 10 was his complaint that the Crown didn't call some unidentified witness. This resulted in an obstruction of justice, abuse, and prevented him from giving a full defense.

Number 11 yammers on and on about prosecutorial abuse of process. Essentially the Crown and the CRA knew that there was insufficient evidence to convict Keith but went ahead and tried him anyhow. Keith, a suggestion, better give this point a bit more thought. You were convicted. That's pretty compelling proof that there was in fact enough evidence to convict. At least it will prove it to the court of appeal.

Also the Crown provided evidence at trial that the Crown knew proved he was innocent but chose to continue the trial anyhow. Keith, back to the point of my prior note. If the Crown gave evidence proving your innocence why were you convicted? It's irrelevant what the Crown thought about the evidence they entered. The Crown didn't convict you, the jury did. They heard the evidence that you feel proved your case but they obviously though it less compelling than you do.

What is really at issue here is the weight to be given to the evidence. Lawson feels that anything that he thinks proves his innocence should have been accepted by the jury while whatever rubbish and lies that the Crown used to convict him should be discarded. But Keith's problem is that the jury was the trier of fact and it was their duty to weigh the evidence. They apparently disagreed with Keith's opinion on this, as they were free to do, and an appeals court is not going to overturn the jury's judgment on the weight to be given to the evidence.

The next point requires a bit of background. During the trial Keith was constantly trying to enter evidence proving that the CRA staff who investigated him were not, at least in his opinion, properly trained. This was based both on his direct experience in dealings with them and from what he said was the training level required by the CRA's own policy manuals. Who cares, you ask? Same question the court had when it disallowed this line of questioning as being irrelevant.

His point in all this, as I understand it, was that he'd explained to the CRA during the investigation, amongst other things (natural man, capitalization, jurisprudence) that he had not made any taxable income because Stewart allowed him to exempt himself from being a taxpayer. Yet they continued their investigation and eventually charged him. He seemed to be arguing in court, and in this application, that the CRA staff working on his file were not qualified to investigate him because they were too ignorant of the law to understand the meaning of Stewart. Had they done so, and he'd tried to explain it to them, they would have realized that he was right and dropped the investigation. The only people who were qualified to investigate him were those staff members (if any) smart enough and well versed enough in law to understand and accept his interpretation of Stewart. Had those people been involved instead of the dullards he unfortunately got they would have agreed with his analysis and dropped the investigation. Still with me? Hope so because, frankly, this argument is way over my head and I've obviously explained it very badly. The way I've written up his argument makes it sound abysmally stupid. That's probably just my inability to understand complex legal analysis.

Anyhow almost done. A point about how he wasn't given the opportunity to test the Crown's case and a final point about statutory interpretation. Apparently if he interprets a statute differently than the Crown this is proof that the Crown has no basis to lay a criminal charge. To quote;

14. Where a statute is reasonably capable of two interpretations, the most favourable to the liberty of the Appellant was to be utilized. In a complex statute such as the Income Tax Act, where the legal onus is on the Appellant to voluntarily comply with the terms and provisions therein, errors of interpretation and/or application of the Act by the Appellant cannot form a basis for criminal or penal liability. These are not strict nor absolute liability offenses. The Honourable Trial Judge failed to so exercise her discretion accordingly.

Of course the critical two words in all of that verbiage are "reasonably capable".

It should be noted that this paragraph goes right to the heart of what the Crown has said all along was the entire reason that Paradigm existed. It was a cover to give justification for a defense against tax evasion charges, essentially insurance if Paradigm customers were caught not reporting their income. They had the entire Paradigm edifice to serve as their defense, masses of publications and videos with impossibly complex theories proving that they didn't have to pay income tax. If the CRA started making hurtful suggestions that they were criminals about to be charged with criminal offenses the Paradigm material was to serve as proof that they had no mens rea, no guilty mind.

They thought that, if caught, they could proclaim that they'd done their absolute best to comply with the law. But it's all so darn complicated that they just couldn't figure it out. So they quite reasonably relied on the analysis of Russell Porisky, a carpenter with no background or training in law or income tax, to instruct them how to fulfill their legal obligations under the Income Tax Act. They didn't try to evade tax. At worst they made, as Lawson put it "errors of interpretation and/or application of the Act". We know how that played out in real life. Apparently the courts have not, as yet, considered the Paradigm bullshit to be a "reasonably capable" interpretation.

But let's end on an optimistic note. Keith still has faith in the jury system! When filling out their appeals applications both Keith and Russell Porisky had to answer the question "If a new trial is ordered and you have a right to a trial by jury do you wish a trial by jury?" Porisky, soured on the whole jury experience, answered no. Keith has chosen yes!

I was playing Mozart's Symphonies by Trevor Pinnock and the English Concert while writing this. Why do I have this feeling that Wagner's Ride of the Valkyries would have been the more appropriate choice? Or Garryowen, the marching tune of Custer's seventh cavalry and the last tune played for them as they rode out from Terry's camp on their way to their appointment with Gall and Crazy Horse at the Little Bighorn. This application is doomed, dead on arrival.

And yet, and yet . . .

I looked out my kitchen window this morning and saw sunlight and blue sky. In Vancouver. In November. It's continued through the day. In a world where November 8th in Vancouver can be anything but endless rain the old rules that maintained the order of things no longer apply and even the impossible can become possible. Even (dare I say it?) Keith's appeal.

[Burnaby49]

I'm feeling a bit guilty about the way I've treated Keith. Really. Well a bit. I gave Russell Porisky the germ of an idea about one of his grounds to appeal his convictions on tax evasion and counseling tax evasion but I haven't given Keith any advice at all. So this post will rectify that omission.

Keith is appealing his convictions on tax evasion and counseling income tax evasion on the basis of his interpretation of the Supreme court of Canada's decision in the Stewart case;

http://canlii.ca/t/51sg

Stewart was released over fourteen years ago. It was a very important case for income tax practitioners. It changed how the CRA viewed the tax deductibility of claimed expenses in money-losing businesses. It has been closely scrutinized by income tax professionals both inside and outside of the CRA. I can speak first hand on this because I was a CRA auditor when Stewart was released and I remember the ruckus it caused. Whenever I went out to meet tax lawyers and accountants they'd crow about how we'd finally had our asses handed to us by the Supreme Court. Stewart has been cited in 250 cases to date.

But nobody, apart from Keith, has ever correctly understood what the Supreme Court was really saying in this decision. I won't go into details yet again on it. Sufficient to say that all we people who made our living in income tax by interpreting and applying court precedence took too shallow a look at Stewart. We just skimmed the surface and saw only the superficial meaning. This was that taxpayers could deduct expenses from a money losing business if it was run in a professional manner and there was no personal component to it. A classic and much litigated example of taxpayers claiming personal expenses is Amway members with no sales who deduct personal and household expenses against other income. In the past when a real attempt to start a business resulted in a loss the CRA would often disallow expenses on the basis of the REOP (reasonable expectation of profit) test, an arbitrary test made by the CRA auditor handling the file, a guy who'd never started a business. Stewart ended REOP.

This is all that the best minds in Canadian tax litigation could see in Stewart but Keith dug much deeper and saw the real meaning that eluded the rest of us. The Supreme court was actually telling us that we Canadians have the individual choice whether we wished to be taxed or not. This is based on a source of income test. If we want to be taxed, no problem, we just say that the source of our income is from a commercial activity, in other words business income. That makes us taxable. But if we choose not to pay tax Stewart allows this too. All we have to do is say that the source of our income is from a personal endeavour, in other words a hobby. This simple declaration exempts us from income tax regardless of the amount of the income or the actual basis on which we made it. If we make this declaration, and Keith says that he did, then the CRA, the Crown, and the courts are required to accept it as legally binding because Stewart orders them to allow complete taxpayer discretion on how the source of income test is applied. Why didn't we practitioners see this?

Keith explained this over and over, to the CRA auditors, to the Crown, to the Supreme Court of British Columbia, but nobody had the depth of understanding of tax necessary to see that he was right and so he was convicted notwithstanding Stewart. And he's going to lose at the British Columbia Court of Appeal (those guys are no better than the rest of us at understanding what Stewart was really trying to tell us).

So Keith, here is my suggestion. The Supreme Court must be very frustrated by the grossly incorrect interpretation the entire tax community has placed on Stewart. They must be burning to have this corrected after fourteen years of seeing Canadian courts applying their reasons totally incorrectly (250 citations!). But they can't do anything unless they have a case in front of them which is based on the CRA using the incorrect interpretation. So when you lose at the British Columbia Court of Appeal you should make Leave to Appeal at the Supreme Court of Canada. If you are correct they will be eager to grant Leave to Appeal and finally set the record straight on what they clearly meant all along.

And now a bit of housekeeping on my part. In my review of Keith's Notice of Appeal application I said;

Number 11 yammers on and on about prosecutorial abuse of process. Essentially the Crown and the CRA knew that there was insufficient evidence to convict Keith but went ahead and tried him anyhow. Keith, a suggestion, better give this point a bit more thought. You were convicted. That's pretty compelling proof that there was in fact enough evidence to convict. At least it will prove it to the court of appeal.

Also the Crown provided evidence at trial that the Crown knew proved he was innocent but chose to continue the trial anyhow. Keith, back to the point of my prior note. If the Crown gave evidence proving your innocence why were you convicted? It's irrelevant what the Crown thought about the evidence they entered. The Crown didn't convict you, the jury did. They heard the evidence that you feel proved your case but they obviously though it less compelling than you do.

But, on re-reading Keith's Notice of Appeal, I found that the second part is wrong. Keith actually said that the Crown had evidence that proved him innocent but did not submit it at trial. His statement in his Notice of Appeal was;

"10 - The Crown's decision not to all its sole CRA witness, is contrary to R v Boucher 1955 SCR in that it was against the Crown's duty to ensure that all relevant facts are on the record to obtain the truth of allegations and defenses, and further amounts to an obstruction of justice, abuse, prevention of relevant evidence that would or could have assisted the Appellant in providing full answer and defense."

"The CRA witness proved exculpatory evidence at the pre-trial which the Crown knew, or ought to have known, would have mitigated against a finding of guilt, and was highly beneficial to the Appellant's case. . . . "

So what was this bombshell evidence that the Crown suppressed? It was that the Crown witness, at a prior hearing, had;

"testified that she was unaware of the Supreme Court's decision in Stewart and the "source of income test" outlined therein and did not consider it in her investigation of the Appellant. The witness admitted that she'd laid the charges on the basis that because the Appellant received money, which she equated to profit and which thus immediately resulted in taxability. This is incorrect and the Crown should have, and had a legal duty to have known this, given the existence of the source of income test set out in Stewart."

In other words exactly what I've written above as being Keith's interpretation of Stewart and what I wrote in the quote below in my posting on this point in my review of his grounds for appeal,

The next point requires a bit of background. During the trial Keith was constantly trying to enter evidence proving that the CRA staff who investigated him were not, at least in his opinion, properly trained. This was based both on his direct experience in dealings with them and from what he said was the training level required by the CRA's own policy manuals. Who cares, you ask? Same question the court had when it disallowed this line of questioning as being irrelevant.

His point in all this, as I understand it, was that he'd explained to the CRA during the investigation, amongst other things (natural man, capitalization, jurisprudence) that he had not made any taxable income because Stewart allowed him to exempt himself from being a taxpayer. Yet they continued their investigation and eventually charged him. He seemed to be arguing in court, and in this application, that the CRA staff working on his file were not qualified to investigate him because they were too ignorant of the law to understand the meaning of Stewart. Had they done so, and he'd tried to explain it to them, they would have realized that he was right and dropped the investigation. The only people who were qualified to investigate him were those staff members (if any) smart enough and well versed enough in law to understand and accept his interpretation of Stewart. Had those people been involved instead of the dullards he unfortunately got they would have agreed with his analysis and dropped the investigation. Still with me? Hope so because, frankly, this argument is way over my head and I've obviously explained it very badly. The way I've written up his argument makes it sound abysmally stupid. That's probably just my inability to understand complex legal analysis.

As I've said. This is the hill that he's chosen to die on.

[The Observer]

So Keith, here is my suggestion. The Supreme Court must be very frustrated by the grossly incorrect interpretation the entire tax community has placed on Stewart. They must be burning to have this corrected after fourteen years of seeing Canadian courts applying their reasons totally incorrectly (250 citations!). But they can't do anything unless they have a case in front of them which is based on the CRA using the incorrect interpretation. So when you lose at the British Columbia Court of Appeal you should make Leave to Appeal at the Supreme Court of Canada. If you are correct they will be eager to grant Leave to Appeal and finally set the record straight on what they clearly meant all along.

Burnaby, why do you hate the Supreme Court of Canada?

[Burnaby49]

So Keith, here is my suggestion. The Supreme Court must be very frustrated by the grossly incorrect interpretation the entire tax community has placed on Stewart. They must be burning to have this corrected after fourteen years of seeing Canadian courts applying their reasons totally incorrectly (250 citations!). But they can't do anything unless they have a case in front of them which is based on the CRA using the incorrect interpretation. So when you lose at the British Columbia Court of Appeal you should make Leave to Appeal at the Supreme Court of Canada. If you are correct they will be eager to grant Leave to Appeal and finally set the record straight on what they clearly meant all along.

Burnaby, why do you hate the Supreme Court of Canada?

I first attended a Lawson court session on February 23, 2015. Since then I've spent uncounted days at the British Columbia Supreme Court listening to him and Millar yammering away about their idiotic beliefs. I still have Millar's sentencing hearings and both of their appeal hearings to get through (alcohol might help). Even the Crown counsel that had these two inflicted on them are now almost out of the picture since one quit and the other won't handle the appeals because Justice Canada has the policy of assigning new lawyers to appeals. I think that the Supreme Court should share the pain.

[notorial dissent]

From what I've seen so far, I should think LOTS of alcohol would be the only help. I would think one round as a lawyer with this bunch would be more than enough to start contemplating a career change.

[Burnaby49]

Lawson's sentencing decision has been released and I didn't notice. So, belatedly, here it is;

R. v. Lawson
2016 BCSC 2446
http://canlii.ca/t/gwp31

[Jeffrey]

Oh I wanted to run something by ya Burnaby. This case has been thrown around recently in the SovCit crowds I monitor as some sort of "proof" that the CRA can be beaten.

http://business.financialpost.com/legal ... -taxpayers

Suspicious to me because it's a year old and it's only now trickled down to the tax protesters.

[Burnaby49]

Oh I wanted to run something by ya Burnaby. This case has been thrown around recently in the SovCit crowds I monitor as some sort of "proof" that the CRA can be beaten.

http://business.financialpost.com/legal ... -taxpayers

Suspicious to me because it's a year old and it's only now trickled down to the tax protesters.

I suppose it depends on what you mean by "beaten". There are two cases mentioned in the article. You can read Leroux here;

Leroux v. Canada Revenue Agency
2014 BCSC 720 (CanLII)
http://canlii.ca/t/g6px8

And, as the write-up said;

Leroux won the war but lost the battle. Tax professionals are calling the B.C. court’s ruling a milestone for taxpayers who seek to hold the CRA accountable for its actions. But the court also found that the CRA’s actions were not the cause of Leroux’s losses. Not only did Leroux fail to receive compensation, the court ordered him to pay the CRA’s legal fees. The case settled earlier this month with Leroux paying the nominal sum of $10 to the CRA for legal costs.

No question that he was fairly harshly treated by the CRA but he still lost. The decision set a general level of care that the CRA owed but the standard is so high that no case, at least that I'm aware of, has triggered it to the point of requiring the CRA to pay damages.

The second case noted in the article, Scheuer, was much more significant because it involved a claimed duty of care to taxpayers before they filed their tax returns, indeed before they made the transactions that the CRA disallowed. The claim in this case was that the CRA had a general duty of care to warn taxpayers away from getting involved in shady tax avoidance schemes. This is Scheuer;

Canada v. Scheuer
2016 FCA 7 (CanLII)
http://canlii.ca/t/gmzdf

To start with there was a lot of money involved. Here is the list of taxpayers in this one appeal.

Lothar Scheuer, Elizabeth Andrusiak, Michael Andrusiak, Donald Belfour, Denise Banga, Ron Billington, Caroline Bird, Wayne Boychuk, Susan Buckle, Wayne Buckle, Michael Cherwenuk, Michael Chillog, Laura Crotenko, Ronald Davidson, Dwayne Deck, Linda Deis, Barabra Dickson, William Dickson, Deborah Dowswell, Robert Dowswell, Patrick Duval, Gary Falkenstein, Colin Fong, Patrick Genoway, Barry Gervais, Cheryl Giambattista, Jordan Giambattista, Nick Giambattista, Ken Hanley, Dale Hanley, Donna Harvey, Cheryl Helmeczi, Dennis Helmeczi, Laurie Helmeczi, Linda Helmeczi, Rand, Duane Hillsendager, Garth Hilts, Carol Hipfner, Jacqueline Hoffert, Russell Holm, Frederrick Howard, Fred Huber, Garth Huber, Lori Ireland, Gordan Joyce, Gordon And Maxine Joyce, Tess Kossick, Kenneth Krawczyk, Frances Kullman, Gordan Kullman, Derrick Lamb, Bradley Lamontagne, Brad Lance, Wayne Larsen, Leslie Padwick, Nick Loffler, Ron Lyke, Shane Lyke, Sheryl Lyke, John Macdonald, Barry Malesh, Martin Marchuk, Alice Mckim, Mark Melnyk, Glen Miskolcz, Herbert Padwick, Sukhdev Parmar, Rochelle Patenaude, Kelly Perkins, Joann Piett, Justin Piett, Lorne Piett, Margaret Pioro, Bernice Predenchuk, Bill Predenchuk, Jason Pugh, Michael Pugh, Dennis Read, Gwendolyn Read, Carla Reinheimer, Jamie Reinheimer, Lance Reinheimer. Alexander Robertson, Cliff Runge, Delores Runge, Kurt Schemmer, Jamie Schneider, Larry Schneider, Michael Schneider, Ronald Schneider, Warren Schultz, Heidi Severson, David Shiplett, Lisa Shotton, Michael Snider, Janet Stanzel, Kent Stanzel, Greg Stewart, Magdaline Stieben, Daniel Szmutko, Katherine Szmutko, Rob Temsland, Anna Trower, David Trower, Margaret Trower, Merlin Trower, Norma Trower, Lyle Ulrich, Marlise Vittur, David Webster, Sheila Webster, Eleanor Welsh, Gerald Welsh, Leonard Weibe, Loretta Weibe, Walter Wilhelms, Gregory Woitas, Christine Younghusband, Jake Zapshalla and Karen Zatylny

What was the issue? A tax avoidance scheme where you purportedly could make a donation to a charity and get a tax refund much greater than the amount you actually paid out of pocket to make the donation.

[2] Lothar Scheuer and the other plaintiffs (the respondents on this appeal) are taxpayers in Canada who participated in a tax shelter donation program marketed and promoted by the Global Learning Group Inc. (GLGI). For the 2004, 2005 and 2006 taxation years, Mr. Scheuer paid, respectively, $10,000, $60,000 and $10,000 to GLGI (paragraph 20 amended statement of claim). In consequence, in those years GLGI provided Mr. Scheuer with charitable donation tax receipts issued by one or more registered Canadian charities in the amounts of $30,047.24, $420,114.91 and $60,053.44 (paragraph 20 amended statement of claim). Mr. Scheuer filed personal income tax returns for each taxation year. In those returns he claimed charitable donation tax credits based on the receipts that he received from GLGI, which credits were applied to reduce the income tax otherwise payable by Mr. Scheuer in each taxation year.

So in the lead plaintiff's case he paid $80,000 to get what was claimed to be about $510,000 in valid tax deductible donation receipts. At an assumed combined federal and provincial tax rate of 30% he would have gotten a refund (had it worked) of over $150,000 for his $80,000 investment. Canadian taxpayers swarmed into these schemes to the tune of billions of dollars of claimed deductions.

I'll give a quick review of how they were supposed to work by considering Global Learning, just one of many of these schemes. They were all, essentially the same. Taxpayers purchased some crap from a promoter, artwork, Chinese manufactured toothpaste, worthless software programs, comic books, whatever, and donated it to a compliant charity at a claimed fair market value much higher than their actual purchase price. As you can see from the above quote Scheuer paid Global Learning $80,000 for a bunch of software licenses which he donated to a compliant charity at a claimed value of $510,000.

They all lost in court because the Tax Court took the common-sense position that if you paid some arm's length individual $80,000 for something then that, at most, was what it was worth and a piece of paper saying it was actually worth $510,00 was irrelevant. Initially the court was somewhat generous with taxpayers and allowed them tax deductions on their actual cash cost but in the end the court got hard-nosed and allowed them nothing at all. I assume that's what eventually happened to Scheuer because that is how the court went on Global Learning when it was heard in Tax Court in 2015;

Mariano v. The Queen
2015 TCC 244
http://canlii.ca/t/glrs3

These were all large organized schemes where the whole sequence of events and property to donate were lined up in advanced so all that taxpayers had to do was write a cheque then claim the donations on their tax returns. They were all reassessed disallowing the donations. All appeals by the taxpayers were dismissed. Some taxpayers, like the ones in the Scheuer case, wanted to find somebody else to cover their loses and chose the CRA for not telling them to keep away from these schemes.

So this leads us back to the Scheuer Federal Court of Appeal case. It is a requirement, under the Income Tax Act, that these large organized schemes get a Tax Shelter Identification Number and that taxpayers, when claiming deductions under the scheme, include the number in their income tax return. A failure to get the number resulted in all deductions under the scheme being disallowed whether valid or not. So Global Learning got a number.

The number is strictly for the administrative convenience of the CRA to identify donations under specific schemes, it serves no other purpose.

[37] For the purpose of the alleged duty of care owed when issuing a tax shelter identification number, the relevant provision is section 237.1 of the Income Tax Act. In brief, the provision prohibits any person from selling, issuing or accepting consideration in respect of a tax shelter unless the Minister of National Revenue has issued an identification number for the tax shelter (subsection 237.1(4)). In addition, it prohibits a taxpayer from claiming a deduction or credit in respect of a tax shelter unless the taxpayer files with the Minister a prescribed form containing prescribed information, including the identification number for the tax shelter (subsection 237.1(6)).

[38] A promoter shall apply to the Minister in prescribed form for a tax shelter identification number (subsection 237.1(2)). Issuance of a tax shelter number is not discretionary. On receipt of an application under subsection 237.1(2) “together with prescribed information and an undertaking satisfactory to the Minister that books and records in respect of the tax shelter will be kept and retained at a place in Canada that is satisfactory to the Minister, the Minister shall issue an identification number for the tax shelter” [underlining added] (subsection 237.1(3), as in force at the relevant time).

[39] Pursuant to paragraph 237.1(5)(c) of the Income Tax Act, every promoter of a tax shelter must prominently display “on every written statement made after 1995 […] that refers either directly or indirectly and either expressly or impliedly to the issuance by the Canada Revenue Agency of an identification number for the tax shelter” and on the copies of the information returns sent to each investor pursuant to subsection 237.1(7.3), the following warning when the return is written wholly or partly in English:

The identification number issued for this tax shelter shall be included in any income tax return filed by the investor. Issuance of the identification number is for administrative purposes only and does not in any way confirm the entitlement of an investor to claim any tax benefits associated with the tax shelter. [emphasis added]

[40] Returning to the application of the Cooper-Anns test, at the second part of the first stage of the test, a court is to ask whether, notwithstanding the proximity between the parties, there are reasons such that tort liability should not be recognized. Had the Judge considered the legislative regime at this stage of the analysis, he would have concluded that no tort liability can, or should, be imposed upon the Minister for simply issuing a tax shelter identification number because, in so acting, the Minister exercises no discretion. Once satisfied that the prescribed information has been provided, that the undertaking to keep the books and records is satisfactory and that the books and records will be kept and retained at a satisfactory place, the Minister must issue the identification number. No duty of care can arise from the issuance of an identification number in this circumstance.

But taxpayers have claimed that issuing a number to a scheme is effectively the equivalent of the Good Housekeeping Seal of Approval and that the CRA was negligent in assigning a number to any scheme that was going to fail in Tax Court.

1 - The Canada Revenue Agency failed to properly manage the operational framework established under the Income Tax Act to protect taxpayers from promoters such as GLGI (paragraph 146);

2 - The Canada Revenue Agency failed to properly assess the scheme submitted by GLGI in order to obtain a tax shelter number (paragraph 147);

3 - The plaintiffs’ tax returns “included the specific information of the donations made based on the tax shelter numbers” issued by the Canada Revenue Agency (paragraph 150);

4 - GLGI also made annual filings to the Canada Revenue Agency reporting all information required under the Income Tax Act concerning individuals who invested in the tax shelter (paragraphs 6 and 151);

5 - The Canada Revenue Agency “was aware of potential issues surrounding the charitable donations made to GLGI as early as the year 2000” (paragraph 149);

6 - The Canada Revenue Agency took no steps to warn or inform Canadian taxpayers, and in particular the plaintiffs, of its concerns about GLGI (paragraph 149);

7 - Rather, the tax return of each taxpayer who invested in the tax shelter was assessed separate and apart from the returns of other Canadian taxpayers (paragraph 152);

8 - The Canada Revenue Agency has continued to allow GLGI to market its program to Canadian taxpayers, knowing that the Agency would not honour any of the tax credits issued (paragraph 155);

9 - Mr. Scheuer was advised that GLGI was registered as a tax shelter under the Income Tax Act, and that it had a tax shelter number (paragraph 13);

10 - Mr. Scheuer relied upon the fact that the Canada Revenue Agency had issued a tax shelter number to GLGI and this was the only reason he contributed to it (paragraph 16);

11 - Mr. Scheuer has suffered substantial health problems associated with the stress of his tax situation (paragraphs 23 and 24); and

12 - The plaintiffs seek damages from the defendants arising from the failure of the Canada Revenue Agency to properly protect them (paragraphs 148 to 159).

In other words the CRA had a duty of care to warn taxpayers not to make charitable donations based on shady tax avoidance schemes. The court did not agree and found that;

[29] I will deal first with the allegations of breach of a duty of care when issuing a tax shelter number and breach of a duty of care to warn Canadian taxpayers, including the plaintiffs, of concerns about the tax shelter.

[30] In my view, there is no category of recognized cases that supports the plaintiffs’ assertion that the Canada Revenue Agency and Canada owed a duty of care to all Canadians when issuing tax shelter numbers or a duty to warn all Canadians that participation in a given tax shelter may lead to the denial of the income tax deductions (the charitable tax credits in this case) allegedly available as a result of such participation. The performance of statutory duties generally does not, in and of themselves, give rise to private law duties of care (Reference Re Broome v. Prince Edward Island, 2010 SCC 11 (CanLII), [2010] 1 S.C.R. 360, at paragraph 13). Something more must be alleged to bring the claim within one of the above enumerated classes or an analogous one: for example, misfeasance in public office or acting in a manner inconsistent with the proper and valid exercise of the powers conferred upon the Canada Revenue Agency under the Income Tax Act.

[44] In my view, this policy consideration applies to a duty of care to warn against investment in an improvident or suspect tax shelter. The written warning tax shelter promoters are mandated by paragraph 237.1(3)(c) of the Income Tax Act to display in connection with use of a tax shelter identification number is consistent with Parliament’s intent that taxpayers should participate in a tax shelter at their own peril, not at the peril of Canadian taxpayers generally. Moreover, at paragraph 8 of the amended statement of claim, the plaintiffs acknowledge that they received independent legal opinions, opinions from accountants and valuation appraisals in respect of the tax shelter. The issuers of such opinions, who benefited financially from the provision of their professional advice, are better placed to indemnify the plaintiffs in the event of negligence in the exercise of their professional responsibilities.

[45] It follows from this analysis that I would strike out the amended statement of claim for failing to assert a cognizable cause of action.

Now I fail to see how this can give any comfort to whatever groups Jeffery monitors who are apparently getting excited by these cases. Perhaps they are really clutching at straws and grabbing hold of paragraph 46 of Scheuer.

[46] The above conclusions concerning a duty to warn reflect that the performance of statutory duties does not generally give rise to private law duties of care. However, liability may attach if public officials act in a manner inconsistent with the proper and valid exercise of their statutory duties, in bad faith or in some other improper fashion. As discussed above, the amended statement of claim suggests in a non-particularized and over-generalized fashion bad faith or delay. As liability may attach for such misconduct, the plaintiffs ought to be given leave to further amend their pleading in a manner consistent with these reasons.

In other words, business as usual as per Leroux. As you've probably noted Keith Lawson claimed that the CRA had some kind of vaguely defined duty of care to him which precluded the Crown from charging him and they violated this duty by not agreeing with him that he wasn't a tax evader.

[Burnaby49]

My posting of November 8, 2016 was my analysis of Keith Lawson's Notice of Appeal. However I did not include the actual document. I finally got around to putting it on Media Fire so here it is;

http://www.mediafire.com/file/iibxq69fv ... cation.pdf

[Burnaby49]

Keith is still batting 1000, continuing his unbroken history of failures in court. He recently went to the Court of Appeal for British Columbia Court to get them to order the appointment of government funded counsel for his appeal from his convictions on counseling fraud, income tax evasion, and GST evasion. He requested this because he claimed he did not have the financial resources to pay a lawyer to handle his appeal. And, just because he fudged a little about his actual financial situation, the court turned him down with this comment;

[33] The burden was on Mr. Lawson to establish he does not have the means to fund his appeal. He failed to meet that burden because I have no faith in the affidavit evidence he presented denying the existence of any assets he could use to fund an appeal. Accordingly, I dismissed his application.

R. v. Lawson, 2017
BCCA 288
http://canlii.ca/t/h544g

What Lawson specifically wanted was a s.684 order from the Court. This is a provision in the Canadian Criminal Code;

Legal assistance for appellant

· 684 (1) A court of appeal or a judge of that court may, at any time, assign counsel to act on behalf of an accused who is a party to an appeal or to proceedings preliminary or incidental to an appeal where, in the opinion of the court or judge, it appears desirable in the interests of justice that the accused should have legal assistance and where it appears that the accused has not sufficient means to obtain that assistance

But Keith needed a lawyer to argue his case that he was entitled to get a s.684 order. So this court hearing was to consider Keith's request for a limited s.684 order so he could get enough funds to retain a lawyer just to argue on his behalf that he was entitled to the full 684(1) funding. And he had a lawyer ready to go if somebody would pay him;

[9] Mr. Lawson’s application came on before me in chambers on June 28, 2017. He advised me he had spoken with a lawyer who is prepared to act for him in the event a limited s. 684 appointment is made.

In order to convince the court that he was entitled to a government funded lawyer Keith had to bare his financial soul to the court, to show that he truly had no means to pay for one himself. So he did, at least to a limited extent. But the Crown found out he had a somewhat selective memory;

[8] On June 21, 2017, Mr. Lawson filed an application for a limited or interim s. 684 order, i.e., for the appointment of counsel to advance a full s. 684 application on his behalf. In support of that application Mr. Lawson filed his own affidavit. He deposed that he, his spouse May Dang-Lawson, and their two children live in a rented apartment in Burnaby, British Columbia. Mr. Lawson says he is unemployed and in poor health. He states Ms. Dang-Lawson’s employment is their family’s only source of funds and that he acts as a full-time home maker and child-care provider. He further states that collectively he and Ms. Dang-Lawson do not have the financial resources to fund his appeal and he does not have any friends or family who can assist him with the appeal.

[10] The Crown, in opposing the application, submitted the appeal had little hope of success, but accepted that some of the grounds are arguable, principally those directed at the charge to the jury. The Crown’s main focus was on the financial disclosure contained in Mr. Lawson’s affidavit, which the Crown said was selective, particularly in regard to Ms. Dang-Lawson. In his affidavit, Mr. Lawson deposed:

37. Neither my wife nor I own any RSP nor TFSA accounts, stocks, bonds, CDs, nor any other form of financial instrument or investment instruments of any significant worth.
He also deposed that neither he nor Ms. Dang-Lawson own any assets of significant value that could be used to raise funds.

So what's missing from the list of what they don't have? He mentioned RSPs (Registered Savings Plans, very big in Canada) and TFSA (Tax Free Savings Accounts, also very big), stocks, bonds, certicates of deposits or any other form of financial or investment instruments. But he stopped there and did not state that he did not have an interest in any other non-financial type of investment such as, say, real estate. Unfortunately for Keith it seems that the Crown wasn't inclined to take him at his word and did a province wide title search and found a real property in Merritt, a town in the British Columbia interior, registered in his wife's name that he'd somehow forgotten to mention.

[11] In light of the submissions made by both parties, I asked Crown counsel to provide me authorities dealing with: (a) whether the financial resources of an appellant’s family members is a relevant consideration under s. 684; and (b) appellate consideration of what I will call the “nature person” defence.

[12] When the hearing resumed on June 29, 2017, Crown counsel drew several decisions to my attention. I will refer to some of them later in these reasons. For his part, Mr. Lawson asked for the opportunity to provide additional information with respect to Ms. Dang-Lawson’s financial circumstances. As a result, I adjourned the matter to July 17, 2017.

[13] On July 12, 2017, Mr. Lawson filed an affidavit from Ms. Dang-Lawson. The exhibits to that affidavit include tax returns, and documents relating to a property in Merritt, British Columbia registered to Ms. Dang-Lawson. On July 14, 2017, the Crown filed an affidavit from a Canada Revenue Agency investigator. The exhibits to that affidavit include a recent title search of the Merritt property, documents concerning Ms. Dang-Lawson’s purchase of that property and the building of a house on it, and banking records relating to accounts belonging to Mr. Lawson and accounts belonging to Ms. Dang-Lawson. Some of those exhibits are copies of documents that were seized during the investigation that resulted in Mr. Lawson being charged.

[14] At the July 17, 2017 hearing, Mr. Lawson reasserted that he lacks the financial resources to fund his appeal. He further asserted that Ms. Dang-Lawson’s financial circumstances are such that she is unable to assist him. For its part, the Crown submitted that both Mr. Lawson and Ms. Dang-Lawson have been less than candid in disclosing their financial circumstances. Much of the Crown’s argument focused on the Merritt property, in particular, the sources of funds used to purchase that property and to construct a house on it. The Crown reasserted its position that although Mr. Lawson has arguable grounds, his appeal has little chance of success.

[20] In his affidavit, Mr. Lawson stated neither he nor Ms. Dang-Lawson own any assets of significant value that could be used to raise funds for his appeal. He did not mention the Merritt property. In recent years that property has been assessed for tax purposes as follows:

2015: $235,700 (Land: $190,000; Improvements: $45,700)
2016: $236,300 (Land: $179,000; Improvements: $57,300)
2017: $246,400 (Land: $170,000; Improvements: $76,400)

Whoops! Cough, cough, right. That property. So Keith tried to argue that the property was nothing to do with him. His wife bought it from her own funds, it was in her name, and he couldn't use it as an asset to fund his defense. Unfortunately, again, the Crown declined to accept his explanation and provided the court with hard evidence rather than affidavits;

[23] The picture painted by Ms. Dang-Lawson is that she purchased the Merritt property solely with her own funds and it is, therefore, not an asset Mr. Lawson can use to assist him in funding his appeal. However, the documents presented by the Crown paint a different picture.

[24] On May 8, 2007, Ms. Dang-Lawson offered to purchase the Merritt property for $187,000, with a $5,000 deposit. The vendors accepted that offer on May 18, 2007, and the transaction completed on June 15, 2007.

[25] On May 22, 2007, Ms. Dang-Lawson withdrew $5,000 from her bank account to purchase the draft used to pay the deposit. On June 8, 2007, she withdrew approximately $184,000 from her bank account to purchase a draft payable to the solicitor acting for her on the transaction. What is significant is that $85,000 of the money used to purchase the Merritt property can be traced to Mr. Lawson.

[26] From May 7 to June 4, 2007, Mr. Lawson deposited a total of $49,000 USD in cash into his US-dollar bank account (5 x $9,000, 1 x $4,000). On June 4, 2007, he converted $49,000 USD into $51,489.40 CAD, and transferred that money to his Canadian-dollar account. That same day he transferred $85,000 from his Canadian-dollar account to Ms. Dang-Lawson’s account. Mr. Lawson’s bank’s records describe that transfer as a “Private Loan”.

[27] Ms. Dang-Lawson has not provided any documents to support her statement that $60,000 of the money used to purchase the Merritt property came from her line of credit. The bank statement for the account from which she withdrew both the $5,000 deposit and the $184,000 payment covers the period May 19 to June 15, 2007. On May 19, 2007, that account had a balance of $73,452.34. There is no $60,000 deposit into that account prior to completion of the property transaction. For Ms. Dang-Lawson to have drawn $60,000 against her line of credit weeks before the transaction completed makes no sense. Accordingly, on the evidence before me, I do not accept that funds for that transaction came from her line of credit. What the evidence does show is that Mr. Lawson provided a substantial portion of the funds used to purchase the Merritt property.

[28] Cancelled cheques from Mr. Lawson’s Canadian-dollar account show he paid a construction company $20,044.98 in August 2008 and $5,521.70 in September 2008 for work done on the Merritt property. Those cheques list the account holder as “Keith David Lawson (a natural person)”. In his submissions to me, Mr. Lawson said he did not consider those payments to relate to building the house on the property because the construction company was simply “moving dirt”. The company’s invoices indicate it was involved in excavating and installing water and electrical lines, and a sewage disposal system.

Inevitably leading to this;

[32] Both Mr. Lawson and Ms. Dang-Lawson have been less than forthright with respect to Mr. Lawson’s involvement in the Merritt property. Indeed, I am of the view their failure to disclose that involvement was intentional and designed to obfuscate Mr. Lawson’s past and present financial circumstances. In other words, they sought to falsely make it appear as if he does not have an interest in any assets that could be used to pay for his appeal.

[33] The burden was on Mr. Lawson to establish he does not have the means to fund his appeal. He failed to meet that burden because I have no faith in the affidavit evidence he presented denying the existence of any assets he could use to fund an appeal. Accordingly, I dismissed his application.

[Burnaby49]

Just a housekeeping item. I just discussed Keith in a different thread in respect to his argument that the Stewart case is a winning ticket to getting his tax evasion conviction quashed on appeal. Unfortunately for Keith the Tax Court decision I reviewed involved a similar Stewart based argument. A Tax Court judge basically said that the tortured interpretation of Stewart argued by the taxpayer in his case, and identical to Lawson's argument, was so profoundly idiotic that nobody with any intelligence whatever would advance it with a good-faith belief in its correctness. So the Tax Court judge sustained the huge gross negligence penalty the CRA had imposed on the taxpayer.

As far as I'm aware Keith is still going for broke on this argument and I'm comfortable in predicting that he's guaranteed to lose his appeal (scheduled for hearing next month) if he uses it. The link to the other discussion is;

http://www.quatloos.com/Q-Forum/viewtop ... 50&t=11917

[Burnaby49]

On March 26, 2019 the British Columbia Court of Appeal heard Keith Lawson's appeal regarding his convictions for income tax evasion and counseling fraud (actually counseling tax evasion). I, of course, was there. Most of the post below was written on the 26th immediately after the hearing. However I delayed posting it because I was waiting for the decision to be released so I could incorporate it in my text. The decision was released this morning so on with my day in court! one note: because the Quatloos word limit restricts how many words (actually characters) are allowed in a single post windbag Burnaby49 had to break the report on the court hearing into two portion. I've picked the morning break as the dividing point. It was all downhill from there anyhow.


Back in the saddle again!

Finally, one of my Porisyites is getting his day at the British Columbia Court of Appeal. This morning Keith Lawson was scheduled to have his appeal on his convictions for income tax evasion and counseling fraud heard. So, after over a year's absence from the courts of British Columbia I dusted off my Office Works 3 subject Notebook and took Skytrain downtown to catch the show. And about time. Keith filed his appeal on October 32, 2016 so it's been about two and a half years since his convictions. I recently posted about the clogged-up British Columbia court system that seems to have endless time to allow defendants to ramble on through days of pointless arguments about their case. But, as you'll see, not today. The British Columbia Court of Appeal ran the hearing like clockwork with a precise, and enforced, time limit.

But first a refresher for those of you who haven't spent the last quarter decade keeping on top of Keith's trial issues. Keith was a follower of tax evader and counselor of tax evasion Russell Porisky. Russ, a carpenter with no tax background or training, promoted an idiotic tax theory that he'd thought up himself which he claimed allowed anyone who didn't want to pay tax to quite legally opt out of the tax system. Way back I posted this explanation from the Canada Revenue Agency about how Porisky's blatantly stupid scheme purportedly worked;

CRA NEWSWIRE
November 30, 2011

DON'T BUY INTO ILLEGAL TAX PROTESTER SCHEMES

The Canada Revenue Agency (CRA) 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.

Natural vs Legal Person

One of the most common false arguments tax protesters use is the natural vs. legal person argument, in which they treat themselves as two separate people for income tax purposes. They define the natural person as the individual that performs the labour required to earn income, and the legal person as the legal entity that the federal government creates through the issuance and use of the social insurance number (SIN). Tax protesters allege that the legal person has to file an income tax and benefit return, and that income received belongs to the natural person and is therefore not subject to Canadian income tax.

Canadian courts have repeatedly and consistently rejected all arguments made in these tax protester schemes.

Serious Consequences

For those involved in tax protester schemes, the CRA will reassess income tax and interest, and charge penalties. In some cases these individuals will be prosecuted for tax evasion. If convicted, they could face significant fines and possibly jail time.

For example, the courts fined an Ontario tax protester approximately $522,000, which represented 150% of the federal taxes evaded. In addition, the individual was given a one year conditional sentence, and was ordered to pay the fine imposed prior to the expiry of the conditional sentence; ordered to remain in Ontario and surrender his passport; and ordered to perform 180 hours of community service.

Correcting your tax affairs

Individuals who would like to correct their tax affairs can voluntarily come forward, and they may not be penalized or prosecuted if they make a valid disclosure before they become aware of any compliance action being taken by the CRA against them. These individuals may only have to pay the taxes owing, plus interest. More information on the Voluntary Disclosures Program can be found on the CRA Web site at http://www.cra.gc.ca/voluntarydisclosures.

The CRA reminds Canadians that, when it comes to their tax affairs, they should get independent advice from a reputable professional.

Along with these comments from me;

Apparently this brilliant loophole was thought up by Russell Porisky, a carpenter with a grade-school education. But he thought big! He started Paradigm Education Group, an outfit that gave seminar on his Natural Person/Legal Person bullshit. They advised people how to evade tax by using the Porisky method. Adherents would pay Porisky for his seminars and also a cut of whatever taxes they avoided. He expanded this by essentially allowing franchising, Individuals across Canada would give Porisky seminars under the Paradigm brand, collect fees from the suckers, and pay Porisky a cut. It was all sunshine and smiles until the Canada Revenue Agency started charging them all with criminal tax evasion.

Keep in mind that what they claimed to believe, while moronically stupid, was not, in itself, illegal. If a Porisky "Natural Person" had filed income tax returns reporting his gross income but showing a nil taxable income because the CRA had to go after the other guy, the "Legal Person", there would be no criminal offence because the income had been declared and the tax returns filed. They would have been reassessed to nail them for the taxes they should have paid and then, had they actually believed Porisky's fantasy, they could have gone to Tax Court to argue their position on its merits. This is why, in some of the cases cited above such as Christian Gerard (Another Poriskyite Loser, in French!), the individuals involved were heard in the Tax Court of Canada, a civil court, rather than facing criminal charges. They denied they owed taxes but did not actively engage in evasion.

However this alternative apparently didn't appeal to most of them so they decided to avoid the sticky question of what the CRA might think about the whole scheme by engaging in actual active tax evasion. The classic type, not filing tax returns, getting paid in cash, hiding income, not keeping books and records, what I would call standard bread and butter tax evasion. Where Porisky came in was when they were caught. Then their defense at trial wasn't that they were evading tax but that they were inquisitive searching minds just doing their best to determine their tax responsibilities to the government of Canada. At the end of their search they ran across an expert to guide them. The expert of course being Russell Porisky. The judge at Eva Sydel's evasion trial had some very pointed comments about her claim that it was reasonable to rely on a carpenter with no tax or accounting background for income tax advice. While some of these fools went to court actively fighting for this argument and other just used it to try and justify their actions they all of them lost. Judges tend to be an unsympathetic lot when people engage in criminal activity for the sole purpose of benefiting themselves. Some, like Carl Gustafson, threw themselves on the mercy of the court and got off with a conviction and a fine but no jail term. Others, particularly the promoters, ended up with jail terms.

Porisky himself was convicted of tax evasion and given a jail term (at this time he has appealed, had the conviction quashed, and is facing a re-trial). However his conviction was not for teaching the Paradigm nonsense but by evading tax on the income he got from it. He'd done well out of his scam, he grossed $1,127,185 on his scheme between 2004 and 2008.

http://www.quatloos.com/Q-Forum/viewtop ... 50&t=10250

Keith went into this full frontal both evading tax and, as a Paradigm 'Educator' counseling others how to evade tax using Porisky's system. At trial he tried mightily to convince the judge and jury that Porisky was right but he also brought up another argument, just as imbecilic as the natural man argument, that claimed that the Supreme Court of Canada had said, in the Stewart decision, that we Canadians had the right to refuse to pay income tax if we don't want to. In Lawson's fantasy world everyone, tax lawyers and accountants, the Canada Revenue Agency and the courts, had completely misinterpreted what the Supreme Court of Canada was really saying in Stewart. We dullards who just read the text of decisions thought it was about the deductibility of expenses against income. But Keith saw a deeper hidden message in the decision that he alone, of all Canadians, could parse out. It wasn't about expenses at all, it was about whether income was taxable or not. He saw through the superficial purported meaning of Stewart and saw that what the Supreme Court of Canada was really saying was that we Canadian taxpayers could quite legally chose not to pay tax if we didn't want too. This is what I wrote about Keith's Stewart interpretation over two years ago;

Keith is appealing his convictions on tax evasion and counseling income tax evasion on the basis of his interpretation of the Supreme court of Canada's decision in the Stewart case;

http://canlii.ca/t/51sg

Stewart was released over fourteen years ago. It was a very important case for income tax practitioners. It changed how the CRA viewed the tax deductibility of claimed expenses in money-losing businesses. It has been closely scrutinized by income tax professionals both inside and outside of the CRA. I can speak first hand on this because I was a CRA auditor when Stewart was released and I remember the ruckus it caused. Whenever I went out to meet tax lawyers and accountants they'd crow about how we'd finally had our asses handed to us by the Supreme Court. Stewart has been cited in 250 cases to date.

But nobody, apart from Keith, has ever correctly understood what the Supreme Court was really saying in this decision. I won't go into details yet again on it. Sufficient to say that all we people who made our living in income tax by interpreting and applying court precedence took too shallow a look at Stewart. We just skimmed the surface and saw only the superficial meaning. This was that taxpayers could deduct expenses from a money losing business if it was run in a professional manner and there was no personal component to it. A classic and much litigated example of taxpayers claiming personal expenses is Amway members with no sales who deduct personal and household expenses against other income. In the past when a real attempt to start a business resulted in a loss the CRA would often disallow expenses on the basis of the REOP (reasonable expectation of profit) test, an arbitrary test made by the CRA auditor handling the file, a guy who'd never started a business. Stewart ended REOP.

This is all that the best minds in Canadian tax litigation could see in Stewart but Keith dug much deeper and saw the real meaning that eluded the rest of us. The Supreme court was actually telling us that we Canadians have the individual choice whether we wished to be taxed or not. This is based on a source of income test. If we want to be taxed, no problem, we just say that the source of our income is from a commercial activity, in other words business income. That makes us taxable. But if we choose not to pay tax Stewart allows this too. All we have to do is say that the source of our income is from a personal endeavour, in other words a hobby. This simple declaration exempts us from income tax regardless of the amount of the income or the actual basis on which we made it. If we make this declaration, and Keith says that he did, then the CRA, the Crown, and the courts are required to accept it as legally binding because Stewart orders them to allow complete taxpayer discretion on how the source of income test is applied. Why didn't we practitioners see this?

Keith explained this over and over, to the CRA auditors, to the Crown, to the Supreme Court of British Columbia, but nobody had the depth of understanding of tax necessary to see that he was right and so he was convicted notwithstanding Stewart. And he's going to lose at the British Columbia Court of Appeal (those guys are no better than the rest of us at understanding what Stewart was really trying to tell us).

But his loss at trial was just a bump on the road. Today was his big chance to set things straight by getting the British Columbia Court of Appeal on his side in interpreting Stewart. So, at today's appeal hearing Keith went for broke on his Stewart interpretation but, for insurance, he added one other ground of appeal. This was also covered in his notice of appeal;

1. The Honourable Trial judge erred in entering a plea of guilty in the presence of stated position of the Appellant that he did not understand the charges and did not fail or refuse to enter a plea. The Trial Judge further erred in failing to explain the charges to the appellant at all, or alternatively, sufficient to permit the Appellant to understand them.

In other words if I claim that I'm too dense to understand the charges I can't be tried. Lawson was articulate and focused throughout his trial. He demonstrated a grasp of difficult concepts and argued the convoluted interpretations of law that formed his defense. But when faced with the task of understanding the charges against him he claims to have suddenly devolved into the village idiot. Any readers having unusual difficulty understanding the basics of these;

Count 1
Keith David LAWSON, at or near the City of Burnaby in the Province of British Columbia and elsewhere, between April 15, 2002 and August 26, 2010, did counsel various persons to commit the indictable offence of fraud in excess of five thousand dollars, contrary to section 380 of the Criminal Code and did thereby commit an offence contrary to section 464(a) of the Criminal Code.

Count 2
Keith David LAWSON, of the City of Burnaby, Province of British Columbia, between December 31, 2003 and May 1, 2009, did wilfully evade or attempt to evade payment of taxes imposed by the Income Tax Act in the amount of $46,176.20 for failing to report his taxable income in the amount of $213,213.13 for the 2004, 2005, 2006, 2008, and 2008 taxation years and did thereby commit an offence contrary to section 239(1)(d) of the said Act.

Keep in mind that Lawson had, literally, years between the charges being laid and his trial. Yet he purports to have arrived in court in a fog with no understanding of why he was being tried.

So that sets the stage. Enough background, on to the bloodbath! One big advantage that the British Columbia Court of Appeal has over the Supreme Court of British Columbia is, at least for that lazy sadsack Burnab49, that it starts at 10AM rather than 9AM. So I got to sleep in and miss rush-hour hell going downtown. Not a trivial advantage. Last week I had to be downtown at 8:30 and it was fucking awful. Way worse than when I did it every day when I worked. Two busses and Skytrain, all stuffed past capacity. I couldn't get off Skytrain at my stop because it was so packed I couldn't get to the door. Not a problem today.

I arrived at courtroom 61 to find a few old acquaintances already there, Michael Millar and Cory Stanchfield;

http://www.quatloos.com/Q-Forum/viewtop ... 50&t=10834

http://www.quatloos.com/Q-Forum/viewtop ... 50&t=10464

Millar's presence was easily explained. He also has a pending appeal regarding his conviction on exactly the same charges as Lawson. So he was there to study Lawson's devastating defense arguments and share in the joy of his inevitable victory. But Stanchfield has no skin in the game. He pled guilty to the same charges and served out his conditional sentence. He was apparently here because he's Lawson's friend. Today's hearing must have been very distressing for both of them.

But, now, finally, the moment I've been dreading. Trying to decipher the 17 pages of single-spaced notes in an 8X10 notebook that I scrawled out in just two hours of Keith's relentless torrent of semi-comprehensible gibberish.

The courtroom was large but spectator seating quite limited, a single row of 18 seats. Apart from Millar, Stanchfield, and myself the other spectators were Lawson's father, someone to my left who stayed through the hearing and seemed to be a lawyer, and three men to my right who also stayed through entire proceedings but seemed to be interested in stock investments. There were two Crown counsel, the lawyer who'd handled Keith's trial and another Crown counsel I'd not met but who'd acted for Crown in the Debbie Anderson fiasco I'd attended;

http://www.quatloos.com/Q-Forum/viewtop ... 47#p244255

Very informal before hearing started. Crown called Lawson 'Keith'. In my observation Crown has been very helpful to the Poriskyite defendants, a lot more than you'd expect given their adversarial relationship. Lawson and Millar totally ignored me, not even a nod of recognition. Hurtful after my immense sacrifice of time and effort to record their battles against the tax system.

Then Order In Court was called and the Appeals Bench came in. Two female and one male judge with a female judge in charge. (A note - When I write that the court said something or that the court asked Lawson a question or told him something it could be any one of the three judges. All three participated in the back and forth with Keith.) After counsel and Keith had introduced themselves to the bench the court asked Keith how long he'd planned for making his submissions. He said he had no idea, practiced in front of mirror, self-represented, never faced appeals court before, he's not a lawyer and couldn't afford one, legal aid might help on an appeal of his sentence but not for an appeal of his conviction, doesn't know how things work here . . . . . Helpfully the court knew exactly how long he would take. He was told the hearing was scheduled for four hours and he had the first two of them.

A point on his comment about legal aid. He has two pending appeals. This one, appealing his convictions, and a second hearing appealing his sentences. Both to be held at this court. Obviously, if he won on the conviction issue the sentencing appeal would become moot, so this hearing was first. However, while legal aid seems willing to help him it wouldn't act for him at this hearing, probably because the entire basis of his appeal was total nonsense with no basis in the real law that legal aid lawyers must use rather than the alternate law in Lawson's fantasy world. But a sentencing appeal hearing is based on real world factors so legal aid can represent Lawson there.

Overall Keith seemed surprisingly ill prepared given how important this is to him and how it's been over two years since he filed the appeal. He'd never had to concern himself with time scheduling at trial but it was critical here. He knew before he came today that he had only two hours but he didn't seem to actually comprehend what that meant. The court knew. They were constantly asking him to move on, or "is that all?" "any more points?" or telling him he was repeating himself. If he stopped for more than a few moments they asked if he was finished. He tried to read out extracts from cases he'd cited or documents he thought relevant but the court wouldn't let him, telling him they'd already read everything. Since he hadn't really structured his presentation or tried to do some serious time-management prior to the hearing he essentially floundered through the last half of it.

I think Keith was caught off balance right from the start by the strict way the hearing was run. One point he kept returning to over and over during the hearing was his grievance that the trial judge hadn't coddled him and babied him along during the trial. In Keith's very expansive understanding of his constitutional rights once he'd told the trial judge the magic phrase "I'm a self-represented defendant" the judge was required to actively participate on his behalf as his personal lawyer. She had to be proactive in his defense, pointing out possible defenses that he'd missed, guiding him through the trial process and, in general, helping him in presenting his arguments to the jury in a legally coherent manner. Sadly she'd failed abysmally at this task. But his complaint of judicial neglect got him no sympathy here. His treatment by the trial judge was like a mother's fond kisses compared to how the Court of Appeal handled him. The Court made it clear to him very early in the proceedings that the carefree halcyon days of his trial, where he could amble on forever and repeat himself endlessly, were over.

So on with the show! After clearing up that his mic was cut off after two hours the presiding judge said that they had read everything submitted. Keith mumbled something and the judge told him to speak louder, his microphone did not amplify, it was only there for recording purposes. So he spoke up. A big help to me since I was sitting behind him and initially didn't hear him either. Judge then told Keith he needed to point out everywhere the trial judge was in error. Keith wanted to talks about his bail terms but the judge said to do it later. Makes sense, if he wins this appeal then bail is irrelevant because his convictions will be quashed. If he loses then bail becomes an issue. Spoiler alert, it became an issue. Keith rambled on for a while that he didn't know what he was doing, an assertion he'd prove to us all soon enough.

The Court asked "Are you following your factum"

Another digression. This is a factum;

In Canada, a written submission or memorandum of law submitted to a court. It includes a concise statement of facts, a list of issues, arguments, the relief sought, and appendices containing case, statutory, and other citations.

https://www.irwinlaw.com/cold/factum

Basically his factum contains his whole case including what he was planning to argue at the hearing and the statutory and case authority supporting him. I have a copy of his factum and some of it is, well, astonishing. In one part he said his conviction should be reversed because the trial judge did not, as her duty required, advise the jury that they could totally ignore the law if they wanted and find him innocent even if they thought he was guilty. But this was ok because nobody knows why they decide on their verdict so they'd never get caught. Not the kind of thing that I think would impress a court of appeal. You're probably thinking Burnaby49 made that up? Here you go, right from his factum, (bolding is mine);

18. Although juries are not entitled as a matter of right to refuse to apply the law they do have the power to do so when their consciences permit of no other course. In the face of this power, it is a legal duty incumbent upon the judge to instruct the jury of the availability of this power, and its application. The judges failure to do so, could reasonably leave the jury making a finding of guilt against their consciences. Because juries are not required to give reasons for their decisions, whether this is so can never be accurately determined. The Appellant submits that the failure to instruct the jury on this point should be considered fatal to his conviction.

He's talking about jury nullification, the ability that juries have to decide against the actual law. This rarely happens but can happen in criminal matters that a jury doesn't think should actually be a crime, such as, before the law in Canada changed, personal use of marijuana. But, contrary to Lawson's statement that it was the judge's duty to tell the jury of this on the off-chance they felt that tax evasion shouldn't be a crime, it was actually the judge's duty to try and stop the jury from learning about it. Let's see what the Supreme Court of Canada has to say on the issue;

65 An accused is entitled to a fair trial, including the presumption of innocence, the duty of the Crown to prove guilt beyond a reasonable doubt, and the ability to make full answer and defence. The accused is not entitled to a trial that increases the possibility of jury nullification. If the trial of the accused has not been unfair and no miscarriage of justice has occurred, the accused cannot succeed on an argument that due to some departure from the norm by the trial judge, his chances of jury nullification are lessened. This point is treated in further detail below.

. . . . .

68 The appellant’s second argument is a broad one, that the accused person has some right to jury nullification. How could there be any such “right”? As a matter of logic and principle, the law cannot encourage jury nullification. When it occurs, it may be appropriate to acknowledge that occurrence. But, to echo the words of Morgentaler (1988), saying that jury nullification may occur is distant from deliberately allowing the defence to argue it before a jury or letting a judge raise the possibility of nullification in his or her instructions to the jury.

. . . . .

70 We reject that proposition. The appellant cannot legitimately rely on a broad right to jury nullification. In this case, the trial did not become unfair simply because the trial judge undermined the jury’s de facto power to nullify. In most if not all cases, jury nullification will not be a valid factor in analyzing trial fairness for the accused. Guarding against jury nullification is a desirable and legitimate exercise for a trial judge; in fact a judge is required to take steps to ensure that the jury will apply the law properly. See R. v. Shipley (1784), 4 Dougl. 73, 99 E.R. 774 (K.B.), at p. 824, cited with approval by Dickson C.J. in Morgentaler (1988), at p. 78. Steps taken by a trial judge to guard against jury nullification should not, on that basis alone, prejudice the accused person.

R. v. Latimer
[2001] 1 SCR 3, 2001 SCC 1
http://canlii.ca/t/523c

Latimer is a leading Canadian case on jury nullification. But, oddly, while Lawson has a respect bordering on reverence for the Supreme Court of Canada's Stewart decision he makes no reference in his factum to Latimer, another SCC decision. Maybe because Latimer shows that Lawson's jury ratification argument is exactly the opposite of the judge's actual duty when instructing the jury? Unfortunately for Keith the Court of Appeal tends to be aware of basic principles like this.

Back yet again to Keith's day in court. I have to stop these digressions. After the factum question, which I don't note him as answering, he said the main issues he wanted to bring up were fundamental issues of justice.

1 - Right to be presumed innocent. - Lawson - I don't know how much of my submission I have to refer to.
Court - Don't.

2 - Poverty - I can't afford a lawyer, I need Court's indulgence.

3 - Stevens v the Queen - Para 16-20 SCBC. Paragraph 17 says it is the duty of the judge to guide an unrepresented accused.

Court - Where does this advance your case?
Lawson - I'll get to it later.
Court - Do it now.

However instead of explaining the importance of Stevens (I can't find the case, it isn't cited in his factum) he suddenly skipped over to his source of income argument and actus reus. This is actus reus;

Actus reus is the Latin term used to describe a criminal act. Every crime must be considered in two parts-the physical act of the crime (actus reus) and the mental intent to do the crime (mens rea). To establish actus reus, a lawyer must prove that the accused party was responsible for a deed prohibited by criminal law.

I'll relate what Lawson argued about actus reus, and it played an important role in his arguments, but I never really understood what he was getting at. Reading his factum didn't enlighten me because he doesn't refer to the term, even once, in the entire 37 page document.

Somehow actus reus fits into his argument regarding source of income, at least that's what he said after suddenly mentioning it. Lawson said that the judge had refused to apply the Stewart source of income test. Stewart is fundamental. "It was a hobby I was engaged in but the judge got tired of hearing it and said I was wrong." It is a principle of duty of the judge to assist me and the judge should have assisted me in telling me where I was doing poorly. It's a common law rule that;

1 - If there is no counsel judge shall give a helping hand
2 - Accused is considered innocent until found guilty.

In the charge to the jury the judge should have said that the Crown had the responsibility to prove that Lawson had a business but during the trial no proof was given but the jury instructions didn't say that. "In the overall course of the trial I was misunderstood and actus reus was not considered. Not putting this to the jury was a serious error."

Trial fairness - The Queen's Bench of Alberta had been cited by the Crown in their submission. I wanted to submit my concerns about the principle of fairness by allowing Crown to cite (note - at his original trial) Meads v Meads. It's 144 pages on what OPCA characteristics are. It says "If they wish a fair hearing they must abandon OPCA practices".

Time for another Burnaby49 intervention. I searched Meads for that quote and didn't find it. Not surprising given that it's not in the decision. I found a link to the quote on Google. The source I found was in a presentation given at the 2012 Department of Justice Annual Conference in Calgary. The conference was titled "The Courts and Beyond: The Architecture Of Justice In Transition". The presentation was titled "Use and Occupancy: Building Codes and Maintenance Manuals in the Court of Queen’s Bench of Alberta" and the paper accompanying the presentation was written by judge Rooke, the author of Meads v Meads, You can download your own copy of the paper here;

https://ciaj-icaj.ca/wp-content/uploads ... pdf?id=859

Right at the end is a three page appendix called the "Court of Queen’s Bench of Alberta EXECUTIVE SUMMARY Subject: Meads v. Meads, 2012 ABQB 571". While this was published by Queen's bench there is nothing to indicate that Judge Rooke wrote it or that it is part of the Meads decision. Its closing statement is;

OPCA litigants have proven highly disruptive, both inside and outside the courts. Their conspiratorial beliefs have led to confrontations with police, security, prosecutorial and other authorities, in-court disobedience, criminal convictions, sanctions for contempt of court, being declared vexatious litigants and a broad range of civil remedies. OPCA litigants consistently harm themselves, other parties involved in the litigation, and the administration of justice.

Meads v. Meads surveys and reviews aspects of OPCA litigation, the persons who promote and use these ideas, and the decade of judicial responses, nationwide. This analysis includes:

1. the identity and activity of known OPCA gurus and OPCA movements;

2. the stereotypic features of OPCA documentation and in-court conduct that identify persons who have adopted OPCA concepts, including Mr. Meads;

3. the arguments and ideas that have been advanced by OPCA litigants (including Mr. Meads) and gurus, and how Canadian courts have categorically rejected OPCA schemes as incorrect; and

4. the responses that courts have taken (and need to take) to litigation that involves OPCA elements.

These Reasons explain and organize OPCA ideas and arguments into groups, and identify global defects that permit more direct response to litigants of this kind. The Reasons also suggest how judges, lawyers opposite, and persons targeted by these abusive schemes can more effectively respond to these problematic litigants. The Reasons explain to Mr. Meads, and other OPCA litigants, that if they wish a fair hearing and decision on the merits of their substantive issues, they will have to abandon these OPCA practices (that raise arguments unknown to and invalid under the law) and, rather, follow Canadian law.

Sloppy work Keith, sloppy work. This executive summary is not part of the Meads v Meads judgment. It is just a brief review of the highlights of the decision and has no legal weight at all. Keith had included this quote in his submission to show how the Crown's citing Meads v. Meads at his trial harmed him but, unfortunately for his argument, it wasn't actually in Meads. However, rather than forgo a good quote, he incorrectly told the appeals court that it was.

I'm never going to get through Keith's two hours at this rate. Apart from the above spurious citation he complained about how Russell Porisky was discussed in Meads and this disparaged Keith's name because the Porisky discussion, matched up to the above citation, implied that followers of Porisky wouldn't get a fair hearing and he didn't get a fair hearing. "I'm discredited by this comment". He said it "shouldn't have been used to discriminate against me".

However Keith was being too modest when he complained only that he was being indirectly smeared by Porisky being referenced in Meads. Keith is in there too and mentioned by name! At least his last name;

[93] 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. 101-105). 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, at para. 21, as are other participants in the Porisky tax evasion ring: R. v. McCartie, 2012 BCSC 928. Many other persons who used Porisky's techniques have already been convicted of tax evasion: Porisky Trial Decision, at para. 63.

I won't quote here what Meads said about Porisky. It's too lengthy and is totally irrelevant to Lawson's submission. If you want to read it you can find it in paragraphs 87 to 98 here;

Meads v. Meads
2012 ABQB 571
http://canlii.ca/t/fsvjq

Ok, back on track again. After Lawson gave his plaintive lament against Meads a judge asked him where the disparagement occurred in his case.

Lawson - Well not specific,
Court - You can't point to anything in the transcripts showing that the judge was prejudice?
Lawson - I'd have to go through them.
Court - You were there. Was there anything?
Lawson - I'll have to check the transcripts.

That was unfortunately typical of Lawson's presentation, disorganized and unsupported by facts. He made accusations against the trial judge that he claimed were serious enough to have his convictions reversed but he apparently didn't bother to find any actual examples in the transcripts to support his claim. He seemed to think the appeals court would just take accept his accusations on faith.

So on to something else, his arraignment and his refusal to plead. This idiocy really got the bench going. He said that when he was asked what he pled he said that he didn't understand the charges against him. Court cut in;

Court - You started saying that you were a private person on a special appearance acting in a private capacity without prejudice and under protest.
Lawson - Right. I didn't have the right to plead that I didn't understand the charges. I was charged with evading taxable income but taxable income is a matter of law and that hadn't been proven.

Time for another explanation. It's not in my notes because I was getting too far behind to write everything but at this point Lawson went into a long explanation that he didn't understand the charge because he didn't understand what type of income he was being charged with evading because there were so many different types of income. Income wasn't defined in the Income Tax Act and the courts were wrong to say that income, for tax purposes, was income as normally understood. This was a conclusion of law but income was actually based on fact and law, the fact being the results of the Stewart analysis he was hanging his hat on. So, before he could understand what income the Crown was referring to when they charged him the Crown was required to do a Stewart test to see if the money he earned was from a business or a personal endeavor.

What he seemed to be getting at was that under his idiotic interpretation of Stewart the Supreme Court of Canada gave him the legal right to define the nature of his income source as he wished, either as a tax-free personal endeavor (hobby) or a taxable business. This choice had to be accepted by the Canada Revenue Agency and the courts with no right to dispute it. He had chosen his income, from whatever source, to be income from a personal endeavor. As a result the Crown was required to accept his statement that he was running his Paradigm operation as a hobby regardless of how he was actually making income from it. This was his "Source Test", the CRA had to accept that the source of his income was whatever he said it was.

Had the CRA done the source test that he said they were required to do before laying charges, they would have had to accept that his income was from a hobby because he said so. And, since (in his fantasy world) the Supreme Court of Canada had said that income from a hobby was tax free this would mean that he hadn't evaded tax and he shouldn't be charged. But the Canada Revenue Agency hadn't done the required Stewart test but instead had just gone ahead and charged him. The Crown hadn't put their cards on the table and defined what the source was of the income he'd avoided tax on so he couldn't understand the case against him. As a result he couldn't plead guilty because, as he understood it, all of his income was hobby sourced and therefore tax-free, so he had no tax to evade. He was only charged because the CRA staff were incompetent buffoons who couldn't understand what Stewart was telling them. But he couldn't plead not guilty either because that would put him in the jurisdiction of the court which would side with the CRA. So he couldn't make any plea at all and should have been let go because of his inability to understand the charges.

Additionally I think this hobby bullshit is actually the basis of his actus reus argument. Actus reus is the physical act of the crime itself. But if he lawfully avoided (not evaded) paying income tax by correctly interpreting and applying Stewart then there was no crime so no actus reus. I think that this was his point but it's only a guess. One flaw in that though. Even if he somehow convinced the court that his interpretation of Stewart was correct that would, at best, only get him off the hook on his personal tax evasion convictions. His fraud conviction for counselling income evasion would still stand. He didn't instruct his 'students' that Stewart allowed them chose not to pay tax. He taught them how to evade income tax by using Porisky's natural man scheme and he was convicted of fraud on that basis. Since he didn't argue at this hearing that Porisky's scheme wasn't fraudulent the basis of his fraud conviction is still unchalllenged and his Stewart analysis, right or wrong, is of no use to him. Explanation done. I'll return to Keith's testimony by repeating his last comment;

Lawson - Right. I didn't have the right to plead that I didn't understand the charges. I was charged with evading taxable income but taxable income is a matter of law and that hadn't been proven.
Court - You are saying that the judge was wrong to plead not guilty on your behalf?
Lawson - Yes. It was a conclusion of law submitted as fact. (no, I don't understand that either)
Court - That applies to all charges. Nobody would ever have to make a plea if we accepted your argument.
Lawson - The CRA assumed that I was guilty.
Court (different judge) - You knew full well what you were charged with but you didn't like it? Lawson - Yes.
Court - Get to the next point.
Lawson - Stewart and the source of income should have been considered before charging me!

He said something else I didn't follow at all about the Attorney general of Canada allowing conclusions of law then said that he'd have understood the charges better if the Crown had explained what they meant by taxable income.

Then Keith brought up one of my cases! Anchor Pointe Energy, a tax case I was involved in way back in 2001 and 2002.

Court - What's your point?
Lawson - Paragraph 27 and 25.

This is paragraphs 25 and 27 from Anchor Pointe.

[25] I agree that legal statements or conclusions have no place in the recitation of the Minister's factual assumptions. The implication is that the taxpayer has the onus of demolishing the legal statement or conclusion and, of course, that is not correct. The legal test to be applied is not subject to proof by the parties as if it was a fact. The parties are to make their arguments as to the legal test, but it is the Court that has the ultimate obligation of ruling on questions of law.

[27] In the present case, it appears that the assumptions contained in paragraphs 10(q) and (r) are the factual components of the mixed conclusion of fact and law in paragraph 10(z). If there are other factual components assumed in the conclusion in paragraph 10(z), the Minister should have extricated them and set them out explicitly.

Canada v. Anchor Pointe Energy Ltd.
2003 FCA 294
http://canlii.ca/t/4gxm

While I had to admire Keith's diligence in digging this deep through a very obscure byway for a relevant quote I had to ask myself, and obviously the court did too, how was this in any way relevant to anything?

Court - These are pleadings in Tax Court. What do they have to do with your criminal case?
Lawson - The Tax Court was concerned with conclusions of law being misleading.
Court - The procedures at Tax Court are different.
Lawson - I wasn't told about the meaning of business.
Court - I'm lost. I thought you were talking about your unwillingness to make a plea. Have you changed points?
Lawson - No, I couldn't make a plea because I didn't understand what taxable income was.
Court - Move on to your next ground for appeal.

But he couldn't. He was too fixated on the brilliance of his income argument. He said that the judge fell into error when she had instructed the jury on the meaning of income. Disorganized as ever Keith had some document showing this but after rooting around in the pile in his table he couldn't find it.

Court -What's the point you are making here?

It seemed the point was the Crown's submission to the jury. One problem with that was that the Crown hadn't made any submissions to the jury, the judge did. Lawson was confusing the two.

Court - Where's the error?
Lawson - The judge went quite wrong. The judge said that income was not defined in the Income Tax Act so it must be given its general meaning.

He said that the Crown had brought up the REOP test (Reasonable expectation of Profit) but a newer case is Stewart. The language used in it has specific connotations. The newer test to determine income is, is there a business? The Stewart two step test must be used. What the judge told the jury is completely wrong. You don't look at income to determine income (note - that's what I heard him say). You must apply the Stewart legal test and that was never done.

Then Lawson brought up the Klundert decision. Quatloos has a discussion on Klundert;

http://www.quatloos.com/Q-Forum/viewtop ... =50&t=5876

One of Lawson's main arguments is that his trial judge was required to submit to the jury any Looney-Tunes preposterous legal interpretation he claimed to believe. He thinks that this constitutes possible grounds for a not guilty decision on the basis that if he persuaded a jury that he sincerely, really, really sincerely believed that he was lawfully following the Income Tax Act by not paying income tax (using his own legal interpretations of course) then he could not be convicted. This is the mens rea argument, that if you don't have the mental intent to break a law you're not guilty even if you break it. But, as we discussed in the Klundert thread, a sincere belief that you are following the law isn't a valid defense in Canada and Klundert was the decision that put the stake through the heart of that defense.

Jack Klundert was a dentist who also followed Porisky's Paradigm tax evasion scheme. As I wrote in that thread;

Time for an update on Mr. Klundert. It took three trials to find the guy guilty of tax evasion, not because his guilt wasn't abundantly clear but because of boneheaded jury instructions by the first two judges. In the first trial Klundert's defense was that he didn't pay his tax because he had a sincere heartfelt belief that he wasn't required to.

Although this is not a defense in law in Canada . . . . the judge actually instructed the jury that if they believed that Klundert had a sincere belief that he did not have to pay tax he was innocent of tax evasion. So the jury found him innocent.

The Crown appealed this and the appeals court slapped the judge around a bit and ordered a new trial. However the judge in the second trial, while stating that Klundert couldn't use this argument, allowed him to use it! So the appeals court ordered a third trial. This time the judge stomped all Klundert's attempts to argue that he really, really, really didn't believe he had to pay tax and the jury found him guilty of tax evasion in 2010.

Klundert is now the Crown's go-to citation when defendants try a sincere belief defense. Since Lawson wanted to use this defense he had to somehow differentiate his case from Klundert. How did he plan to achieve this magic? Let the man himself explain.

Lawson now referred to Klundert saying that the trial judge made a significant error by relying on it. The Klundert facts were different. Klundert had admitted that he had income so actus reus was not an issue. But Lawson had testified that he did not have a business and had never admitted that he had a business. He said that this was exactly what Stewart was trying to correct in paragraph 60 of the decision.

This is paragraph 60 of Stewart

60 In summary, the issue of whether or not a taxpayer has a source of income is to be determined by looking at the commerciality of the activity in question. Where the activity contains no personal element and is clearly commercial, no further inquiry is necessary. Where the activity could be classified as a personal pursuit, then it must be determined whether or not the activity is being carried on in a sufficiently commercial manner to constitute a source of income. However, to deny the deduction of losses on the simple ground that the losses signify that no business (or property) source exists is contrary to the words and scheme of the Act. Whether or not a business exists is a separate question from the deductibility of expenses. As suggested by the appellant, to disallow deductions based on a reasonable expectation of profit analysis would amount to a case law stop-loss rule which would be contrary to established principles of interpretation, mentioned above, which are applicable to the Act. As well, unlike many statutory stop-loss rules, once deductions are disallowed under the REOP test, the taxpayer cannot carry forward such losses to apply to future income in the event the activity becomes profitable. As stated by Bowman J.T.C.C. in Bélec, supra, at p. 123: “It would be ... unacceptable to permit the Minister [to say] to the taxpayer ‘The fact that you lost money ... proves that you did not have a reasonable expectation of profit, but as soon as you earn some money, it proves that you now have such an expectation.’”

As you'll note there is absolutely nothing there supporting Lawson's fever-dream about being able to say his income was from a hobby and the Supreme Court says that income from a hobby is tax-free. The issue in Stewart was solely the deductibility of expenses. If you have a business you can deduct them even if you have a loss, if you have a hobby, you can't. That's it.

Lawson, after referring to paragraph 60, started reading it to the court.

Court - Don't. We are familiar with Stewart.
Lawson - In my trial they didn't do the Stewart analysis to see if it was a hobby which I always thought it was. Had the test of whether I had a commercial activity been put to the jury the outcome would have been different. Stewart said that the source test had to be applied first. I didn't have a licensed storefront activity.

Court - What other errors are you arguing?
Lawson - Non-registered activity. We were all learning, trying to find out what income meant. We wanted to restructure our activities to legitimately not pay tax but the judge used words like evade and avoid.
Court - Was it an error for her to do that?
Lawson - Yes, judge should have instructed jury on this.
Court - what should she have said?
Lawson - Judge should have pointed out that an attempt to avoid being liable to pay tax is different than avoiding paying tax. This is a profound error.

At this point another comment about Lawson. He is, hands-down, the most articulate and composed of all of the tax evasion defendants I've watched. But while he seems to place great store on his speaking skills they were actually useless to him because he has no real understanding or knowledge of income tax law to speak about. While his arguments and answers were generally well presented they were just superficial skating over the surface of tax law and devoid of any useful content. At heart all that he was presenting as a defense was that his personal tax beliefs were right and everybody else was wrong. Unfortunately for Keith the Court of Appeal didn't care how articulate he was, they wanted to hear a defense based on real law and relevant jurisprudence and Keith couldn't give them that.

After the last quote above the court asked;

Court - Any other errors?

Which resulted in a tidal wave of articulate gibberish. The charge to the jury pointed out the essential elements of tax evasion but the judge didn't say that you had to analyze the source. There should have been special instructions on this. I never considered it a business. I knew what a business was and I didn't want to become one because that would have made me liable for income tax. Stewart says that whether an activity is a business rather than a personal endeavor is up to the individual. I knew I had a hobby not a business. I had no control over the fact that I made money, it just happened by chance. I had a tax protester mindset, I admit it, but Porisky made me realize it. I didn't like paying income tax but the Income Tax Act is legal. So I recanted my beliefs and studied tax law. Lawson said that after 2004 he realized that he didn't have to pay income tax. He was willing to pay tax on his income but since he had a hobby he didn't have any income.

Court - Next point.

Lawson hauled a 2009 Tax Court case out of his grab-bag. I didn't catch the name, something about rental income.

Court - We understand where you are coming from. Where did the trial judge err?
Lawson - The judge didn't allow me to present this to a jury.
Court - You wanted the judge to place a no-income defense to the jury?
Lawson - Yes, an error in law.
Court - No. Your interpretation of law has to have an air of reality. You are saying that the judge failed to instruct the jury that you had to be proven to have a business?
Lawson - No.
Court - You are saying that the judge was wrong in not accepting your understanding of law?
Lawson - No.
Court - But the judge did say that income is not defined in the Income Tax Act and you are saying that she was wrong? This is arguing that the judge made an error in law. You are saying that the judge didn't accept your testimony as an understanding of law. Are you saying that the judge erred in her instructions in not saying that Stewart required the jury to review your intent not to have a business?
Lawson - Yes.
Court - You claim that this is an error in law?
Lawson - Unintelligible gobbling (that's what my notes say)

Lawson, after a few moments to gather his strength after this onslaught, said that the judge went wrong in trying to establish the meaning of income. He gave a bizarre example of how he once went to the United States and, at a fast food place, was asked by a friend to get him a soda. Lawson walked around in a fog trying to figure out what the friend wanted until he saw the soda dispensing stand and realized that 'soda' in the US is what we call 'pop' or 'soft drinks' in Canada. This anecdote somehow related to his case but the connection eluded me. Something about figuring out what 'soda' meant was easy but since the Income Tax Act didn't say what 'income' was the judge had to analyze the meaning and she'd failed to do that.

Lawson - The judge needed to tell the jury what the test of income was. You need to look for evidence that I made income according to Stewart. Nowhere does the judge say that I had to pursue profit to have a business.
Court - The jury must have found that you had an expectation of profit.
Lawson - That test has been supplanted by Stewart. My main point is that while the judge gave the jury some of my evidence she didn't point out the significance of it.
Court - We're almost at the break. Any other points you can cover quickly?

But Keith, still reeling from the last barrage, didn't seem to know what to say. So the court called for recess saying that it would allow Lawson to collect his thoughts.

I have in my notes that my left hand, my writing hand, was almost crippled and that only the break saved me. I'm currently on page 17 of the single-spaced Word document I'm recording this on and morning break was called only an hour after court started. ONLY AN HOUR. Back in the easy-going trial days when Michael Millar would unleash an afternoon long barrage of gibberish about capitalization or jurisdiction I could relax. There was so much endless repetition that I could just casually pluck a comment here or there out of the stream every few minutes and job done. But, at 11:15 on March 26th, 2019 I was seriously wondering if I had the capability to make it through Keith's second hour. What saved me was that Keith was also flagging and his second hour was less the articulate presentation of a coherent set of legal arguments than it was the hopeless attempts of a punch-drunk old pugilist, reeling on the ropes, trying to stay on his feet until the end of the round.

[Burnaby49]

It was right back to business after court resumed.

Court - What other errors are you alleging?
Lawson - Source is a concern. I tried to bring it to the judge's attention.

Apparently during break Keith had found a few examples from the trial transcript where he'd told the judge what he wanted in the jury instructions but the judge just talked about an air of reality test and wouldn't include them. "When there are ambiguities in the law accused should be given the benefit of the doubt. The judge didn't raise this in the instructions." The judge wasn't willing to hear the his Stewart arguments. Keith said he didn't realize what the "air of reality" test was (note - I'd say that its meaning was patently obvious from its name). Judge summarized that he was wrong about Stewart and if he disagreed with her point of law he could bring it up on appeal.

Lawson said that the correct way for the judge to instruct the jury was to explain the source of income test and that he had an actus reus belief on the source of the money he made.

Note, yet again, that Lawson doesn't seem to understand what actus reus means. As explained earlier actus reus is in respect to the physical act of the crime. You can't have Keith's claimed "actus reus belief" because a physical act isn't a belief. Keith's claimed defense that he held a sincere belief in his understanding of the Stewart decision is actually mens rea a statement regarding his mental intention. Unfortunately for Keith Mens rea doesn't work for him because a sincere belief that you were correctly following the law isn't a valid defense in Canada. This point was brought up at his trial and he lost on it because the Klundert decision, which I've just discussed, precludes the use of this defense. Perhaps Lawson, by no means unintelligent, realized this and was deliberately trying to recharacterize his argument by shifting it's legal basis from mens rea to actus reus because actus rea was not covered in Klundert.

Digression over. Keith told the court that the trial judge should have instructed the jury that he considered his income to be a private endeavor and not commercial in nature and that if they agreed that he really believed this that they had to find him not guilty. But the judge just told him he was wrong in his interpretation of Stewart. The appeals court decided that it was time for a body blow;

Court - You had that defense and you argued it to the judge. If we agree here with the trial judge this ends most of the points of your appeal.

I had a momentary, fleeting impression at this point which might be entirely wrong. It seemed to me, from how the judge was speaking, that the judge was about to continue that last comment and say something equivalent to the trial judge's statement that if Keith didn't like her actus reus ruling he could appeal it. If so the judge stopped just short of saying it.

Lawson's response was to just keep beating the long dead horse. He said that the trial judge told the jury that "Mr. Lawson had income" without mentioning that he didn't have a business. The judge just accepted that actus reus was already established.

Then Lawson said that the judge had actually put in her jury instructions that "Mr. Lawson had no income" but he was still found guilty. The appeals bench wasn't putting up with that blatantly incorrect claim;

Court - That comment was the judge telling the jury your position. The judge was not saying that you didn't have any income.

It must have been very awkward for Keith that the appeals judges had actually read, and remembered, all of the material. I couldn't make much sense out of Lawson's next comment. He seemed to be suggesting that the trial judge had somehow subliminally planted suggestions in her instructions that Lawson had income although she hadn't done, or allowed the jury to do, a Stewart source test to prove this. My notes don't expand on this. But whatever he actually said was indicative of how he was acting at this point. He was totally disorganized, he seemed to have nothing new to say or any idea how to continue and was just repeating prior arguments.

He went back to his old favorite. He said it was just a presumption by the judge that he had income without requiring the Crown to do a Stewart analysis to prove it. Unless the members of the jury had a business background they had no way to know what a business was or wasn't so the judge should have done his Stewart test to instruct the jury on this point. Then some citation showing how the judge had a duty to raise and consider arguments by both parties.

Court - She did that, she considered your Stewart interpretation and rejected it. This eliminates this point of appeal.

Court then noted that Lawson had argued something about indicia of profit at trial and the judge had rejected it. The court pointed to Keith that the phrase "indicia of profit" did not appear in any evidence in front of them.

Keith tried a new tack and cited some case where a decision had been reversed on appeal because a judge had not understood defense arguments. The problem with this approach, when applied to Keith's case, was that his trial judge had understand his arguments but didn't agree with them. He seemed to be implying that his arguments were rejected because the trial judge was just to deficient in her understanding of law to understand his legal analysis. Had she done so she would have agreed with him.

He went into an analysis of mixed fact and law that lost me and perhaps the court too. He said that while judges determine facts of law a Stewart analysis requires mixed fact and law so the judge had to consider his intent and actus reus, he just loves actus reus. He seemed unable to grasp the fact that it didn't matter what he claimed that a Stewart analysis required, a question of fact, a question of law, a question of mixed fact and law, parsley, sage, rosemary and thyme, it was all irrelevant because the trial judge had rejected the entire concept of a Stewart analysis. But he kept at it saying, that the judge should have considered his claimed intent. His intent not to have a business should have been put to the jury. True enough; had the trial judge been somehow baffled enough to accept his idiotic interpretation of the Stewart case. But, absent that, whether or not he had a business was totally irrelevant to whether or not he'd committed income tax evasion.

He was starting to lose coherence. My notes read "some unstructured gabbling" about him having a right to an affirmative defense (a term he didn't define) but the judge hadn't pointed this out to him. He didn't understand what was going on at his trial so he couldn't make a "sensible submission" and the trial judge had a duty to help him with this.

Court - Had it been done differently (at his trial) what would you have done differently?
Lawson - I wouldn't have wasted court time.
Court - Wasted time is not an appealable issue. Make here the arguments you would have made there.

So it was put up or shut up time. He was invited to make to the appeal court whatever arguments he had wanted to make to the jury but had been barred from doing so by the judge. Give it your best shot! Instead he changed the topic entirely and started going on about how he'd been studying and learning tax law. Court cut him off;

Court - You brought that up in court (trial court).
Lawson - Ok but I didn't know about the Klundert case.
Court - You did know. You referred to it.
Lawson - If I made any sensible submissions it was by accident.
Court - The court couldn't do that for you.
Lawson - Yes but I did a poor job and the judge had a duty to help me on it.
Court - You made your points to the judge but she rejected them.
Lawson - I think I could have done a better job if the judge had helped.
Court - Anything further?

Lawson floundered about trying to think of something else and failed. Just some totally unstructured babbling about how individual taxpayers can have hobbies and the presumption of innocence meant that the Crown had to prove that he didn't have a hobby. His claim to have a personal endeavor should have been a "default" in his case because of the presumption of innocence.

At the risk of beating this point to death I'll explain what I think is the reason he kept on about presumption of innocence. To do this I'll totally ignore real law and roll with the fantasy law in Keith's head. In his dream world he was innocent of tax evasion if he said he had a hobby. Stewart specifically told him this although the rest of we dullards read it otherwise. The presumption of innocence meant that his claim to have made his money through a tax-free hobby had to be accepted unless the Crown could prove that he actually had a business. But in Keith's view the Crown couldn't wait until the trial to try and prove him guilty by showing that he had a business. The presumption of innocence meant, at least to Lawson, that the Crown had to somehow prove he was guilty of tax evasion before he could be charged with tax evasion because charging him meant that they thought he was guilty and he'd therefore lost the presumption of innocence. In his fantasy world the only way that the Crown could prove he was guilty was by proving that he had a business. To do this they had to use his idiotic Stewart analysis which would always guarantee that he was found innocent because, in his self-serving belief, Stewart required the Crown to accept his claimed intent. Since he'd said that he did not intend to have a business when conducting his Paradigm activities the Crown had to accept that his income wasn't from a business but was instead from a tax-free hobby. Therefore he hadn't evaded any income tax and he couldn't be charged. But he was charged and the arraignment judge made a reversible error in pleading not guilty on his behalf because, as the above analysis showed, Stewart had already proven that he wasn't guilty.

I hope that clarifies things for you readers not knowledgeable about fantasy law.

We'd left Keith bleating about his presumption of innocence. After he finished that topic he came up with a brand new argument. He claimed that the Income Tax Act said that he didn't owe tax until the Canada Revenue Agency assessed him on it. Since he was never assessed he never owed tax so he didn't evade paying taxes. Had they assessed him he could have argued personal endeavor but the CRA, by not assessing him. never gave him that chance. He was implying that everything, trial, appeal, was all the CRA's fault for not assessing him. This was the first time, in my long history of attending his court hearings, that I'd heard that argument.

There's one slight problem with that argument. It's complete bullshit. An assessment doesn't create a tax liability. Earning income creates the liability. Let's try an analogy regarding expenses, your electrical bill. You owe the power company money because you used their electricity. The power company bills you at the end of the month but you created the liability during the month heating up all those frozen pizzas in the microwave and using all those other appliances we all have. However the bill didn't create the liability, it's just a statement telling you how much you owe for all that power you've already used. An assessment notice is similar. My tax liability is created by my making income. An assessment is just a notification from the CRA of that tax liability. These are the relevant lines in the Income Tax Act;

DIVISION A
Liability for Tax

2 (1) An income tax shall be paid, as required by this Act, on the taxable income for each taxation year of every person resident in Canada at any time in the year.

(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.

Income for taxation year

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:

PART XVII
Interpretation

248 (1) In this Act,

balance-due - day of a taxpayer for a taxation year means,

. . . . . . .

(c) in any other case where the taxpayer is an individual, April 30 in the following taxation year

Anybody see anything about an assessment notice being needed to create a tax liability? Take my case. I'm scrabbling to get my 2018 income tax return finished and filed by the April 30th deadline because I'll be penalized if I don't. But I don't have an assessment notice from the CRA telling me how much I owe. I have to pay an accountant to tell me that. I accrued my tax liability over the course of the year by getting pension and other income and tax was automatically owed on it when I received it. This is why the Income Tax Act requires employers to deduct and remit taxes from their employees every pay period. They owe it when they earn it. As you'll note in the above definition April 30th isn't the date that my taxes are owing, it's the date that any remaining unpaid taxes for the year are finally required to be paid. We only file tax returns once a year because it would be administratively impossible to be constantly assessing fifteen million taxpayers, not because there is some magic about April 30th or assessments. I'll get an assessment notice after my tax return is filed and reviewed but it will just tell me the status of my filing, whether I've paid too little or too much tax or (unlikely event) I got it right first try.

In any case the CRA couldn't assess Keith because he was careful to ensure that the CRA didn't find out that he was making money from Paradigm. They can't assess income if they don't know that you've earned it and Keith wasn't going to tell them. The CRA only found out about Keith's income indirectly when they did a search and seizure at Russell Porisky's home and found information about Keith's Pardigm income on Porisky's computer.

However I have to admit that there is a pleasing circularity to Keith's argument. You aren't evading tax if the CRA hasn't assessed you on your income because you don't owe any tax until you are assessed. However the CRA can't assess you if you're successfully evading tax because it doesn't know you're making any income to assess so you don't owe any tax. As I understand Keith he's arguing that if you are successful at criminally evading your tax obligations tax you aren't an income tax evader. Keith should have been a tax lawyer.

At this point he was like a blown racehorse in the home stretch, still game but fading fast. Just comments apparently at random. Next up - He wasn't counseling evasion he was just teaching tax. He seems to have no idea about the purpose of the appeal court. That argument was part of his defense at trial but it has nothing to do with any possible reviewable error by the judge. It was just a defense that failed. The jury found him guilty on the evidence and the Court of Appeal isn't going to overturn his convictions on any arguments that failed at trial or any new ones he brings up now. He has to find legal errors committed by the trial judge. The court went after him immediately on the counseling comment;

Court - The question of counseling was left to the jury, right?
Lawson - Yes. But he didn't counsel others to cheat government of tax, he taught others to consider the source of income.

See, he just doesn't get it. There's no point telling the appeals bench that the jury got it wrong and misinterpreted what he was doing. They aren't going to overthrow a jury verdict based on assumptions of what the jury considered. The court's comment wasn't in reference to that. It was saying that the jury got the facts, including Lawson's arguments, and decided against him after a review of those facts. That's not an appealable issue he can relitigate.

Court - Did the judge read out entire the instructions regarding the law on income tax evasion?
Lawson - Judge should have told the jury it wasn't illegal to have a personal endeavor but she didn't. I did my best to interpret the law and I had a reasonable interpretation (of all the whoppers he's told today that one wins first prize). Income tax law doesn't relate to all income everywhere. The jury wasn't instructed that the money I got wasn't income because it was from a hobby. Judge gave one half of story but not about hobbies. I believed this at the time and it was the most reasonable interpretation because I respected the law and tried to use it correctly.

Court cut in - You've used your time, anything else?

Lawson brought up two cases, both post-Stewart, about how two different fact sets can have two different outcomes. Both were rental situations where the landlord was trying to deduct expenses in excess of income. The court determined that one taxpayer had a business and the other didn't. Keith started some explanation of how this made sense in his world.

Court - Make your point.

Lawson - One was income and one wasn't income. Criminal proceedings should have to prove not income (note - he must have meant "should have to prove income" but he was losing it).

And Lawson was done. His two rentals example was a pathetic ending to the fiasco. It was totally irrelevant to anything in his appeal. While I don't have the citations so I don't know the cases I know what the cases would have entailed, Tax Court cases involving claimed income losses from rental are a dime a dozen. Both would have been small rental operations, maybe some homeowners renting a basement suite room to their son, maybe somebody renting out an investment apartment. Both were losing money, the home because the owner was writing off excessive general household costs against the rent (property tax, heat, electricity, maintenance) and, if an apartment rental, because mortgage interest exceeded rent (Stewart exactly). The Tax Court judges did Stewart-based factual reviews of whether these were actual business operations or not and one won and one lost. If the Tax Court had referenced Stewart in either case the Stewart analysis (if you want to call it that) would have been in respect to deductible expenses, not the taxability of income, because that's what Stewart was all about. There have probably been hundreds of Stewart based reviews by the Tax Court of Canada in the seventeen years since the Stewart judgment was released yet Keith failed to cite a single case that supported his position that the analysis involved determining the taxable status of income. Why not? Because they don't exist. Nobody has ever gone to Tax Court with the claim that the Stewart decision allowed them to claim their income was tax free because they'd deemed it hobby-based.

As a general comment a relatively good first half and a very weak second half. In the first half he Was at least somewhat structured and he initially went through his material with little of the repetition that plagued his second half. He was focused and able to answer questions even if the answers were gibberish. But even in the first half he started flagging towards the end and began the endless repetition that seemed to annoy the court.

But He had nothing new to say in the second half and my notes show it graphically. I take notes in an 8X10 wire-bound notebook. I tend to fill the pages, always printed. Keith's first hour took 11 full pages of notes. His second hour needed only 6 pages. He just couldn't keep up the pace and concentration in the second hour. He often appeared confused and always seemed to be fumbling around for papers. The second hour was essentially just a repetition of the first. After having two years to prepare he'd managed to throw together just enough arguments to last through the first hour but he insisted on being allowed his full time, possibly hoping he'd somehow hit a point that resonated with the court. So he flailed away, just tossing out passing thoughts in the hope that something would stick. It didn't.

So a one and three quarter hour lunch break then back for part two of the appeal. This was the Crown's rebuttal and, like Keith, they had two hours. I'd hoped they wouldn't take that long, they certainly didn't need it. And my wish was granted. They didn't need any time at all. It turned out that all they had to do to win the case was show up.

Court resumed at 1:50. Normally the court would now begin hearing submissions from the Crown but the appeals bench chose to take a different path. As soon as the hearing resumed the three judges beat Lawson senseless with a tire iron! Not literally, although it would have made a great visual, but the result was the same. As you'll see he was literally senseless, for a few minutes totally stunned after they'd finished ripping his appeal apart.

What actually happened was that immediately after the hearing resumed a judge said "We don't have to hear from Crown". Veteran court reporter Burnaby49, who's heard that dire sentence before, knew immediately what it meant, as did the Crown counsels, but I don't think Keith had a clue that he was about to get fed through the grinder. What did the court's comment tell informed observers? The Crown had the right to two hours for arguments and there was only one reason that the court would tell them not to bother; the court had already arrived at its decision and the decision dismissed every argument in Keith's appeal. If the court thought that there was any discernible merit to any part of Lawson's appeal, no matter how trivial, or if they had any disagreement with, or questions about, the Crown's submissions, they would have given the Crown an opportunity to speak. So it was clear that Keith was about to get it with both barrels. If he didn't realize this he wasn't kept in ignorance long.

After telling Crown counsel that they weren't needed the presiding judge started reading from an already written, ready to publish decision that tore Keith to shreds. They must have written it at lunch but I don't doubt that they'd already had a very good idea what the decision would be before the hearing even started. They'd read all of Keith's submitted material and there was nothing in his factum or Notice of Appeal (I've read both) that had the slightest chance of being accepted by the court. As Keith himself had said at the beginning of the hearing, his oral statements were really just secondary to the written arguments he'd filed. So he was entitled to his two hours and he got them but he did nothing to change the court's mind.

How bad was it for Keith? This bad;

Summary:

Mr. Lawson, who was an educator with the Paradigm Educational Group, appeals from his convictions on several counts of tax-related offences, including tax evasion, on the basis that the trial judge erred in her charge to the jury. At trial, Mr. Lawson argued that he had owed no taxes under the Income Tax Act and the Excise Tax Act because his earnings were all from a self-described “personal endeavour.” The trial judge rejected Mr. Lawson’s interpretation of the relevant law and refused to put a mistake-of-law defence to the jury, reasoning that the defence had no “air of reality.” Held: Appeal dismissed. The trial judge committed no errors in her jury charge that warrant appellate intervention. The tax theory that Mr. Lawson sought to rely upon was wrong at law and rested upon the selective reading of legislation and jurisprudence. The trial judge thus did not err in declining to put this theory to the jury.

[1] STROMBERG-STEIN J.A.: On May 4, 2016, the appellant, Keith David Lawson, was convicted by a jury on four counts of tax-related offences:

(1) counselling to commit fraud, contrary to s. 464(a) of the Criminal Code, R.S.C. 1985, c. C﷓46;

(2) tax evasion, contrary to s. 239(1)(d) of the Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.) (the “ITA”);

(3) making false tax return statements, contrary to s. 239(1)(a) of the ITA; and

(4) evading compliance with the Excise Tax Act, R.S.C. 1985, c. E-15, contrary to s. 327(1)(c) of that Act.

[2] Mr. Lawson sets out a number of grounds of appeal in his factum, claiming the trial judge erred by:

1. entering pleas of “not guilty” when he says he did not understand the charges;
2. leaving the question of whether he received an “income” to the jury because:
- a. this is a question of law for the trial judge;
- b. she did not instruct the jury that not all monies received are taxable;
- c. she did not instruct the jury on the “source of income” test from Stewart v. Canada, 2002 SCC 46, to determine whether money received is taxable income; and/or
- d. she provided an incorrect, vague, or ambiguous definition of “income”;
3. leaving the jury with the question of whether he received a “profit” because this is a question of law or mixed fact and law; and
4. instructing the jury that they could not consider his intention to engage in a personal endeavour by way of private contract.

[3] I would re-state Mr. Lawson’s main grounds of appeal as follows:

1. whether the trial judge erred in entering a plea of “not guilty”;
2. whether the judge erred by leaving questions of law or questions of mixed fact and law with the jury in respect of matters related to the definitions of “income” and “profit”; and
3. whether the judge erred in not putting Mr. Lawson’s “personal endeavour” defence to the jury.

1. Did the judge err in entering a plea of not guilty?

[4] On April 7, 2016, Mr. Lawson appeared in court. He asserted that he was a private person, attending by “conditional special appearance under continuing objection for lack of jurisdiction.” The clerk read the charges and asked Mr. Lawson how he was pleading. To each count, Mr. Lawson responded that he could not plead because he did not understand the charges. He said he had objections that were not addressed and that certain charges included terms that he took issue with. The trial judge accepted Mr. Lawson’s responses as deemed not guilty pleas to each count.

[5] Section 606(2) of the Code permits a judge to enter a plea of “not guilty” where “an accused refuses to plead or does not answer directly.” Mr. Lawson admits that he pleaded neither “guilty” nor “not guilty” to the charges in question. Mr. Lawson’s responses clearly fall within the ordinary meaning of “does not answer directly”.

[6] In my view, there is no merit to this ground of appeal.

2. Did the judge err by leaving questions of law or questions of mixed fact and law with the jury in respect of matters related to the definitions of “income” and “profit”?

[7] Mr. Lawson’s submissions about the judge’s instructions on the meaning of “income”, “source of income”, and “profit” are without merit. The judge properly instructed the jury on the elements of each offence, and properly left the jury with the task of finding the facts and determining whether they were satisfied that each element had been proven and that each charge had been proven by the Crown beyond a reasonable doubt.

3. Did the judge err in not putting Mr. Lawson’s “personal endeavour” defence to the jury?

[8] Mr. Lawson was an educator with the Paradigm Educational Group (“Paradigm”). Paradigm claimed to have arrived upon a method for individuals to structure their finances so that they could, legally, not pay income taxes. The basic premise, as taught by Paradigm educators to their students, was that the ITA does not apply to money received under a contract if the receiver describes themself as a “natural person” and structures their affairs with the person or company for whom they are working in a particular way — for instance, as a contract for hire.

[9] At trial, Mr. Lawson did not rely solely on the “natural person” theory, which has been soundly rejected by the courts: see, for instance, R. v. Klundert, 2008 ONCA 767 (“Klundert #2”). He also invoked the Supreme Court of Canada decision of Stewart in support of his contention that he had received, or believed he had received, no “income” for the purposes of the ITA and the Excise Tax Act. He maintained that he had intended his activities to be a personal endeavour and not a business, for which reason these activities did not count as a source of income. Mr. Lawson said that he had private contracts with students under which they compensated him for his labour and that the amounts received under these contracts were, therefore, private property rather than income. He said he used these funds to support himself and his family.

[10] It appears that Mr. Lawson’s tax avoidance strategy developed as follows. At some point, he realized that the original Paradigm theory, according to which the ITA fails to apply to individuals qua “natural persons,” would not succeed in the courts. He accordingly devised a new theory that sought to exploit the possibility of the mistake-of-law defence contemplated by the Ontario Court of Appeal in R. v. Klundert (2004), 242 D.L.R. (4th) 644 (“Klundert #1”). Unlike the pseudo-legal arguments at issue in Klundert #1 and Klundert #2, however, Mr. Lawson’s revised theory rested on a purported mistake as to the definition of “income” rather than the jurisdictional application of the ITA — in particular, that “income” does not include moneys earned from self-described hobbies or personal endeavours. I can see no error in the trial judge’s treatment of income, which in our view is consistent with Stewart.

[11] The trial judge refused to leave with the jury the limited defence of mistake of law on the basis there was no air of reality to this defence. Relying on the reasoning in Klundert #1, the judge found that Mr. Lawson’s mistaken belief that the ITA is invalid or otherwise not applicable to his conduct was irrelevant to whether or not the fault requirement was met on the charges. Further, the trial judge found that even if the defence could apply, Mr. Lawson was aware of, possessed, and taught case law that contradicted his theory that he did not have to pay tax.

[12] In my view, the judge did not err in rejecting the defence of mistake of law. The Paradigm theory is founded on the erroneous and selective reading of legislation and jurisprudence. It has been revised over time, evolving in response to unfavourable rulings in the case law. It is a bogus, nonsensical theory. In my view, the judge committed no error in not putting Mr. Lawson’s “personal endeavour” defence to the jury. In the words of MacFarland J.A. in Klundert #2 at para. 20, “…this kind of mistake of law is irrelevant to the fault requirement of the charge of tax evasion.”

Additional Issues

[13] Mr. Lawson has raised a number of other complaints about the content and sufficiency of the jury charge. In my view, none of these complaints have any merit.

[14] As well, Mr. Lawson has argued the judge failed in her duty to him as an unrepresented litigant. While the judge has a duty to ensure that all possible defences are put to the jury, this only includes those defences that have an air of reality. There is no merit to Mr. Lawson’s complaint that he did not get a fair trial.

Conclusion

[15] In my view, the judge committed no errors in fact or law and made no errors in her jury charge warranting appellate intervention.

[16] I would dismiss the appeal.

[17] WILLCOCK J.A.: I agree.

[18] FISHER J.A.: I agree.

[Discussion with appellant and counsel re: sentence appeal]

[19] STROMBERG-STEIN J.A.: The sentence appeal will be heard on May 27, 2019, for two hours. Mr. Lawson is to file and serve his sentencing statement by May 6, 2019. The Crown will file and serve their response by May 13, 2019. Mr. Lawson will surrender himself at 9:00 a.m. on May 27, 2019. Bail is granted pending sentence appeal.

https://www.courts.gov.bc.ca/jdb-txt/ca ... CA0109.htm

As brutal and efficient an execution as I've ever witnessed. All of Lawson's years of effort to correctly understand and apply Stewart briefly dismissed in a few words;

[7] Mr. Lawson’s submissions about the judge’s instructions on the meaning of “income”, “source of income”, and “profit” are without merit. The judge properly instructed the jury on the elements of each offence, and properly left the jury with the task of finding the facts and determining whether they were satisfied that each element had been proven and that each charge had been proven by the Crown beyond a reasonable doubt.

The released written decision matched exactly what was read out in court. Thinking it over that seems like a lot of work to have cranked out in a lunch lunch. Could they have done at least a preliminary draft even before the hearing? I know, I know, an unworthy thought but consider, what could Keith possibly have added in oral arguments that would have salvaged his disastrous Grounds For Appeal and Factum?

So how did Keith react to this? He was, as you'll read below, stunned. He seemed almost unable to comprehend what had just happened. Immediately after the decision was read out the judge told Keith that he would be either put into custody "forthwith" or have his bail extended, his choice! Pretty extreme as either/or options go! This related to the second issue to be considered by the court at this hearing. Keith was entitled to appeal his conviction (just concluded) and if that failed he was entitled to make a separate appeal in respect to the sentence imposed by the trial judge. So, with the conviction appeal done the court moved on to the issue of a possible sentencing appeal. If Keith still intended to appeal his sentencing, the court would, with the Crown's concurrence, discuss extending his bail until the day of the sentencing hearing. If he wasn't appealing the sentences he would be immediately incarcerated to serve them out. So what was his decision?

And Keith was so shell-shocked, so stunned by the beating he'd just taken that he couldn't answer! He seemed unable to comprehend what was being said to him and he couldn't get composed enough to respond coherently. He just started babbling. I don't think he'd ever considered the possibility that the court would give an adverse decision, never mind right then and there, and he'd been overwhelmed by events. Crown counsel filled in a few awkward moments by informing the court that the Crown was not opposed to continuing bail. This gave Lawson enough time to pull himself together and, when the court asked the question a second time, he said that he would be appealing his sentences. Then the court gave him another body blow. He was obviously thinking that he would be given what he considered a reasonable preparation time (maybe another two years?) to put an appeal together. But the British Columbia Court of Appeal wanted this done. The Court gave Lawson and Crown a number of possible dates for the sentencing hearing and they ended up with May 27th. "Not ready, not ready!" Lawson exclaimed.

Keep in mind that he's had over two years to prepare for these appeals yet he seems to have done little, or nothing, towards his sentencing appeal. Perhaps he was just over-confident, thinking that a sentencing appeal wouldn't be needed because, at the Court of Appeal, he would finally find a group of judges sufficiently knowledgeable and intellectually capable enough to understand and agree with his interpretation of Stewart. Whatever the reason, if he's not ready, he'd better get ready. This court showed no sympathy whatever to his claims of legal inexperience, lack of familiarity with court procedures, or lack of preparation.

A judge asked Lawson what his grounds of appeal would be. He didn't know. He was told he'd better file his appeal documents promptly. Then they discussed transcripts, I think the transcripts of his sentencing hearing but I'm not sure, I was getting too far behind in my scrawling. Lawson was responsible for providing the transcripts and the court asked him if he had them or had ordered them. He didn't know. I think it unlikely. They are expensive and he doesn't seem to have put much thought into sentencing issues. It was decided that the issue would be discussed at case management where he would have to prove that he either had the necessary transcripts or had ordered them.

There was also some discussion about legal aid. As I've discussed Keith had already gone to them for help but they'd refused to represent him at the conviction hearing but a sentencing appeal is different. It's just straightforward law and a review of the judge's sentencing decision would consider mitigating and aggravating circumstances like Lawson's past record (none), culpability (probably high), and personal circumstances (significant health issues and family responsibilities). An appeal would argue that the judge gave too little weight to mitigating circumstances and too much weight to aggravating circumstances and, maybe, throw in some jurisprudence on sentences handed down in similar circumstances. Bread and butter stuff for legal services. Then we were finally done. I probably missed some important point in this discussion but by this time I was as disorganized as Lawson, but without the consequences.

I have to say I wasn't feeling the love from this court in its dealings with Keith. They gave him no help or assistance at all. Maybe he can appeal to the Supreme Court of Canada using, as a basis, the argument that the British Columbia Court of Appeal failed in its duty to him as an untutored self-represented appellant by not holding his hand and advising him how to win his appeal. But remember, Keith has another very potent argument to take to the Supreme Court of Canada. Given Keith's overwhelming confidence that only he has understood what the Supreme Court of Canada really said in the Stewart decision and everybody else, including his own trial judge and appeal bench, got it wrong, he should have no problem getting the Supreme Court to accept a leave to appeal from him to clear up the obvious misunderstanding regarding the real meaning of Stewart. As I wrote in this discussion over two years ago;

I'm feeling a bit guilty about the way I've treated Keith. Really. Well a bit. I gave Russell Porisky the germ of an idea about one of his grounds to appeal his convictions on tax evasion and counseling tax evasion but I haven't given Keith any advice at all. So this post will rectify that omission.

So Keith, here is my suggestion. The Supreme Court must be very frustrated by the grossly incorrect interpretation the entire tax community has placed on Stewart. They must be burning to have this corrected after fourteen years of seeing Canadian courts applying their reasons totally incorrectly (250 citations!). But they can't do anything unless they have a case in front of them which is based on the Canada Revenue Agency and the Crown using the incorrect interpretation. So when you lose at the British Columbia Court of Appeal you should make Leave to Appeal at the Supreme Court of Canada. If you are correct they will be eager to grant Leave to Appeal and finally set the record straight on what they clearly meant all along.

[svezg]

That was a genuinely amazing read. Thank you.

[Burnaby49]

You're welcome. Keith deserved my best effort. As a bonus the appeal hearings regarding Russell Porisky (The MAN himself in a joint hearing with Elaine Gould) and Michael Millar's convictions are coming up in April and May and Keith's sentencing hearing is at the end of May. At the moment my calendar shows that I can attend all of them. It will be a pleasure to watch Millar try to summarize anything in a two hour framework. He was at Keith's hearing so he's aware that the court isn't going to cut him any slack at all on allowed time. At least he knows now not to waste any of that precious two hours arguing Stewart.

[notorial dissent]

I have to say that I think you did Keith proud, detailing his massive fail step by step in glowing excruciating detail.

Aren't you being overly generous with Miller? He's shown absolutely no sense to date, why should he start now? They all seem to want to relitigate their losing cases in front of the appeals courts rather than appeal them, and it is a sure and certain loser when they do, and they just don't learn, even after repeated bashings about the head and shoulders. If they haven't twigged by now just how likely is it that they'll have a come to jeebus moment? Seriously.