Re: Russell Anthony Porisky - Poriskyite Extraordinaire!
Posted: Thu Jan 28, 2016 12:38 pm
And undoubtedly a good deal more entertaining.
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The jury started deliberations 1:30 yesterday but went for an hour and a half lunch break first. They had another break for supper at 6:30. I was there but, as you'd expect, went pubbing after the day's session. By the time I got home, about 10PM, the jury had decided on their verdict, been dismissed, and were home too. A total of about five hours in deliberations.Court File Number: 25339-14
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
DANS LACOUR SUPREME DE LA COLOMBIE-BRITANNIQE
CANADA,
PROVINCE OF BRITISH COLUMBIA/PROVINCE de la COLOMBIE-BRITANNIQUE,
CITY OF Vancouver /VILLE DE Vancouver.
HER MAJESTY THE QUEEN I SA MAJESTE LA REINE
AGAINST I CONTRE
ELAINE GOULD and I et RUSSELL ANTHONY PORISKY
INDICTMENT / ACTE D'ACCUSATION
Elaine GOULD and / et Russell Anthony PORISKY stand charged that / sont inculpes de ce qui suit:
Count I / Chef I
Russell Porisky, being of the City of Chilliwack, Province of British Columbia, between December 31, 2003 and December 4, 2008, did wilfully evade or attempt to evade the payment of taxes imposed by the Income Tax Act, by failing to report taxable income of Russell Porisky in the amount of$893,937.19, and did thereby evade the payment of $208,681.62 in income tax, contrary to section 239(l)(d) of the Income Tax Act.
Count 2 / Chef 2
Elaine Gould, being of the City of Chilliwack, Province of British Columbia, between December 31, 2003 and December 4, 2008, did wilfully evade or attempt to evade the payment of taxes imposed by the Income Tax Act, by failing to report taxable income of Elaine Gould in the amount of $218,073.22, and did thereby evade the payment of $27,434.56 in income tax, contrary to section 239(1 )(d) of the Income Tax Act.
Count 3 / Chef 3
Russell Porisky, being of the City of Chilliwack, Province of British Columbia, between December 31, 2003 and December 4, 2008, did wilfully evade or attempt to evade compliance with the Excise Tax Act or payment or remittance of the Goods and Services Tax, by failing to collect or remit Goods and Services Tax of$66,133.45 on goods and services sold by Russell Porisky and Elaine Gould doing business as Paradigm Education Group, and did thereby commit an offence contrary to section 327(1)(c) of the Excise Tax Act.
Count 4 / Chef 4
Russell Porisky, at or near the City of Chilliwack, Province of British Columbia, or elsewhere in the Province of British Columbia or other parts of Canada, between December 31, 2000 and December 4, 2008, did counsel, procure, solicit or incite various persons to commit the indictable offence of fraud in excess of five thousand dollars, contrary to section 380(1 )(a) of the Criminal Code, and did thereby commit an offence contrary to section 464(a) of the Criminal Code.
AND AGAINST THE PEACE OF OUR LADY THE QUEEN HER CROWN AND DIGNITY.
ET CONTRE LA PAIX DE NOTRE DAME LA REINE, SA COURONNE ET SA DIGNITE
DATEDTHIS/FAIT LE /'18 day of/jourde January, 2016,at the City of Vancouver I dans la Ville de Vancouver, Province of British c()lWl;ia I Province de la Colombie-Britannique.
Agent for the Director of Public Prosecutions I
Represenrant du directeur des poursuites penales
Porisky countered this in the video by saying that nobody was smart enough, and versed enough in tax law except him to understand that Kennedy had really won notwithstanding that he lost. Russ said that he'd deconstruct the judge's comments and found that they meant the exact opposite of what everybody else had assumed they meant.[9] Under s. 2 of the Income Tax Act, the liability to pay income tax is imposed on resident or non-resident “persons”. Under s. 248(1) of the Act, a “person” is defined as follows:
“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of subsection 149(1), from tax under Part I on all or part of the entity’s taxable income and the heirs, executors, administrators or other legal representatives of such a person, according to the law of that part of Canada to which the context extends;
In his submissions, Mr. Lindsay emphasized the words “includes any corporation”. By inference, he says, Parliament intended to exclude natural persons from this statutory definition of a “person”. At least, that is what I understand to be the essence of his submission.
[10] Under s. 248(1) of the Income Tax Act, a “taxpayer” includes any “person” whether or not liable to pay tax. Therefore, in Mr. Lindsay’s submission, if someone is not a “person” as defined in the Income Tax Act, then that someone cannot be a “taxpayer” as defined by the Act.
[11] In support of this submission, Mr. Lindsay has drawn my attention to Black-stone’s Commentaries as to the Rights of Persons and to Magna Carta which, as he rightly reminded me, Lord Denning has described as the greatest constitutional document of all time. As Blackstone points out, “Persons are divided by the law into either natural persons or artificial”. He goes on to explain:
Natural persons are such as the God of nature formed us; artificial are such as are created and devised by human laws for the purposes of society and government, which are called corporations or bodies of politic.
[12] It is significant for our present purposes that Blackstone considers both artificial persons and natural persons to be persons although they may have different characteristics (see para. [20] below.
[13] I was also referred to the definitions of “person” in The Business Profits War-Tax Act, 1916, S.C., 6-7 Geo V, c.11 and in The Income War Tax Act, 1917, S.C., 7-8 Geo V., c.28, forerunners of the present Income Tax Act. These statutes contain identical definitions of “person”, in the following terms:
“person” means any individual or person and any syndicate, trust, association or other body and any body corporate, and the heirs, executors, administrators, curators and assigns or other legal representatives of such person, according to the law of that part of Canada to which the context extends;
[14] Unlike its forerunners, the definition of a “person” in the current Income Tax Act does not expressly mention “any individual or person” (see para. [9] above). I am asked by the applicant to infer from this omission, that, in enacting the current definition, Parliament intended to relieve natural persons from their previous statutory obligation to pay income taxes.
[15] Who is a “person” within the meaning of the Income Tax Act? Applying the established rules of statutory interpretation (see para. [8] above), the question may properly be restated: what is the ordinary meaning or common or popular sense of the word “person”? The Canadian Oxford Dictionary (1998), gives as the primary meaning of the word, “an individual human being”. The Nelson Canadian Dictionary of the English Language (1997) gives as the primary meaning of the word, “a living human being”. Dictionaries are a recognized aid to the courts in determining the ordinary meaning or common or popular sense of a word used in a statute in accordance with the general rules of statutory interpretation.
[16] Black’s Law Dictionary (7th Ed.) (1999) gives as the primary meaning of the word “person”, “a human being” and, as a secondary meaning, “an entity (such as a corporation) that is recognized by law as having the rights and duties of a human being”. Osborn’s Concise Law Dictionary (7th Ed.), (1983) defines a “person” as:
The object of rights and duties, that is, capable of having rights and of being liable to duties. Persons are of two kinds, natural and artificial. A natural person is a human being; an artificial person is a collection or succession of natural persons forming a corporation.
…
In the Dictionary of Canadian Law (2nd Ed.) (1995), a “person” is a “natural person” and “includes a body corporate or politic” Blackstone himself made the same distinction between natural and artificial persons and treated them all as persons in the eyes of the law (see para. [11] above).
[17] These definitions taken from dictionaries including dictionaries of legal terms are uniform and clear. A “person” in its ordinary meaning includes a human being or a natural person as well as an artificial person such as a corporation. The primary sense of the word is a natural person; the secondary sense, an artificial person such as a corporation.
[18] The Interpretation Act (Canada) is consistent with this ordinary meaning. Section 35 of that Act defines a “person”, as follows:
“person” or any word or expression, descriptive of a person includes a corporation.
The use of the verb “includes” extends the definition to include a corporation. The definition does not exclude a human being. In the French text of the Act, the meaning is even clearer:
« personne » Personne physique ou morale; Tune ou l’autre notions sont visées dans des formulations générales, impersonnelles ou comportant des pronoms ou adjectifs indéfinis.
A “personne physique” is a natural person; a “personne morale” is a corporation.
[19] I am, therefore, driven to the conclusion that in its ordinary meaning and in its common or popular sense, the word “person” in a statute includes both natural persons and corporations.
[20] I am also driven to the conclusion that there is nothing in the context of the Income Tax Act. or in the authorities to which Mr. Lindsay has referred me, that would support the interpretation that in the Income Tax Act, Parliament intended the word “person” to be used in the narrower sense of comprising only corporations or other artificial persons. The statutory definition of a “person” in section 248(1) of the Income Tax Act includes “the heirs, executors, administrators… of such a person”. Only a natural person who has died has “heirs, executors, administrators…”. A corporation or other artificial person does not. As the English jurist Lord Chancellor Thurlow (1731-1806) is quoted as saying: “Did you ever expect a corporation to have a conscience, when it has no soul to be damned, and no body to be kicked?” J. Poynder, Literary Extracts, (1844) Vol. 1, page 268.
[21] I find that a “person” as defined in s. 248(1) of the Income Tax Act includes both a natural person and an artificial person. It follows that the applicant is a “person” and a “taxpayer”. I also find that he is a person “resident” in Canada. Either a corporation or a person may be “resident” or, indeed, for other legal purposes “domiciled”, in Canada or elsewhere. As a “person”, the applicant has the same rights and obligations as any other “person” under the Income Tax Act. His obligations include the filing of annual income tax returns and the payment of any income tax owing under his returns.
This is what the first trial judge instructed the jury which resulted in the acquittal being quashed;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 defence was that he didn't pay his tax because he had a sincere heartfelt belief that he wasn't required to. He was pulling the Porisky "natural person" argument explored in the "The Infection is Heading North" thread;
viewtopic.php?f=8&t=7827
Although this is not a defence in law in Canada (we have no Cheek equivalent) 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. Klundert used the same defence again. As the appeals court said in respect to the second trial;
[11] At his second trial, despite this court’s ruling, the respondent again took the position that the Act was beyond the powers of the federal government. However, he did not argue that he failed to pay taxes that he knew were owed because he believed the Act to be unlawful and so inapplicable. Rather, he explained his failure to pay taxes as arising from his belief that he was not obligated to pay taxes. Klundert took the position that he was not obligated to pay income tax because he believed the Act does not apply to him. Klundert testified that he is neither a “person” nor a “taxpayer” as defined in the Act.
[12] The “defence” offered by the respondent at his second trial was merely a nuanced version of the defence offered at his first trial, a defence this court held was unavailable to him.
However the judge in the second trial, while stating that Klundert couldn't use this argument, allowed him to use it!
[24] In his charge, the trial judge correctly told the jury that the respondent’s evidence that he was a tax protestor did not provide a defence to the charge of tax evasion and did not go to the issue of Klundert’s intent to evade the payment of taxes. However, when he put the position of the defence to the jury, he stated that it was the position of the defence that:
[A]ny rational person could not have intended to evade by acting in the manner of the accused. They should acquit unless they are satisfied beyond a reasonable doubt that his stated intention to solely protest was not his honest intent.
[25] In so doing the trial judge erred in law. Where as a matter of law a defence is not available to an accused, it must not be put to the jury. Where defence counsel argue such a defence before a jury, the trial judge’s obligation is to clearly and unequivocally tell the jury that defence counsel was in error and that arguments to that effect cannot be relied upon in coming to a verdict.
http://canlii.ca/t/21j7z
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. He was ordered by the Ontario Superior Court of Justice to pay a fine of $522,346.73 with respect to the taxation years 1993 through 1997 and in 2011 was ordered to pay a further $101,393.80 pursuant to a conviction for income tax evasion for the years 2000 to 2005.
The court of appeal concluded that;[26] About two and a half hours later, the jury returned with three more questions about the mental element of the crime of tax evasion. The trial judge responded:
(1) Please explain the mental elements about the evasion of taxes.
The word evade implies something of an underhanded or deceitful nature. In other words, a deliberate attempt to escape the requirement of paying tax on income that had been earned.
…
(2) Please explain the relevance of being a tax protester.
There is no relevance as long as his belief is honest. You can’t just get up and say I’m a tax protester, therefore I’m innocent. What the Crown has to prove is that his tax protest is a deceitful method of evading taxes and the Crown has to prove that beyond a reasonable doubt. You have heard Dr. Klundert. He said, I didn’t intend to evade taxes, I just intended to protest.
(3) If we find that he was honest in his beliefs, do we therefore find him innocent?
Well remember what I told you, if you believe what he said, if you believe his evidence, the Crown has not proved that he had the specific intent to evade taxes beyond a reasonable doubt. If you feel that he is honest, or if you have a reasonable doubt about it, in other words, I think he is honest, then the Crown has not proved that he had the intention to evade taxes beyond a reasonable doubt [emphasis added].
[27] After a brief discussion with counsel, the jury was recalled. The trial judge told the jury that he misspoke in his recharge when he was explaining the relevance of being a tax protestor. The trial judge corrected his previous instruction in these terms:
As to the answer to question two, please explain the relevance of being a tax protester in this case. You can be a tax protester in this case. You can be a tax protester but if the Crown proves beyond a reasonable doubt that your protest was for the purpose of evading taxes then you may find him guilty. If he is reckless about it and is honest then you would have a reasonable doubt that he did it for the purpose of evading tax. If he is dishonest about it then you may find that the Crown has proved his intent to evade tax beyond a reasonable doubt.
[28] The net effect of the trial judge’s instructions was to tell the jury that a person who refused to pay his or her taxes as a protest could not be convicted of evading the payment of taxes if that protest was made “honestly”. Applied to Dr. Klundert’s evidence the instruction became a direction that a refusal to comply with the Act based on an honest belief that the Act was beyond the powers of the federal government was a defence to a charge of wilfully evading taxes. The jury was told that Dr. Klundert should be acquitted of that charge unless the Crown could prove beyond a reasonable doubt that he did not have that honest belief.
However, notwithstanding these clear instructions, the judge at the second trial allowed the defense to put forward the mistake in law defense. This generated another trip to the appeals court, another acquittal quashed, and a third trial ordered.[59] A person’s mistaken belief that a statute is invalid or is otherwise not applicable to that person’s conduct is a mistake of law. It is, however, a mistake of law that is irrelevant to the existence of the fault requirement in s. 229(1)(d). Nor can that kind of mistake of law provide a freestanding excuse for the commission of a crime: Criminal Code, s. 19; R. v. Jones (1991), 1991 CanLII 31 (SCC), 66 C.C.C. (3d) 512 at 516-517 (S.C.C.); R. v. Watson (1999), 1999 CanLII 13906 (NL CA), 137 C.C.C. (3d) 422 at 431-33 (Nfld. C.A.).
[60] There are solid policy reasons for drawing a distinction between an accused who mistakenly believes that he or she is complying with the Act and an accused who knowingly violates the Act, but mistakenly believes that the Act is invalid. The former is trying to comply with the law. Particularly where the law is complex, a mistake concerning the applicable law can logically negate the blameworthiness of the person’s conduct. The latter is not trying to obey the law, but is instead deciding which laws should be obeyed. An acquittal based on a mistaken belief as to the validity of a law would undermine the rule of law.
[61] There can be no suggestion that a person who honestly believes that the Act is invalid has no option but to evade the payment of taxes and then defend a charge of tax evasion on the basis of a belief that the Act is invalid. As Dr. Klundert acknowledged, there were mechanisms in place whereby he could have challenged the validity of the Act without evading payment of taxes owed under the Act. He chose not to pursue any of those avenues. Indeed, even in this case, he did not defend the charge, as he clearly could have, by asking the judge to declare s. 239(1)(d) invalid.
[62] My conclusion that Dr. Klundert’s belief that the Act was invalid is irrelevant to his liability under s. 239(1)(d) is consistent with the conclusion in Cheek, supra, a case involving a tax protestor who refused to pay his income tax claiming that the Act was unconstitutional. In holding that the accused’s belief as to the validity of the Act was irrelevant on the charge of wilfully evading income tax, White J. said, at 612-613:
Claims that some of the provisions of the tax code are unconstitutional are submissions of a different order. They do not arise from innocent mistakes caused by the complexity of the Internal Revenue Code. Rather, they reveal full knowledge of the provisions at issue and a studied conclusion, however wrong, that those provisions are invalid and unenforceable. …
We do not believe that Congress contemplated that such a taxpayer, without risking criminal prosecution, could ignore the duties imposed upon him by the Internal Revenue Code and refuse to utilize the mechanisms provided by Congress to present his claims of invalidity to the courts and to abide by their decisions. …
We thus hold that in a case like this, a defendant’s views about the validity of the tax statutes are irrelevant to the issue of willfulness and need not be heard by the jury, and, if they are, an instruction to disregard them would be proper. For this purpose, it makes no difference whether the claims of invalidity are frivolous or have substance [emphasis added].
[63] Dr. Klundert’s evidence as to his beliefs concerning the validity of the Act were irrelevant to his liability under s. 239(1)(d). The jury should not have heard that evidence. Having heard it, the trial judge should have told the jury that it was irrelevant to Dr. Klundert’s culpability.
And concluded;
[65] The instructions to the jury reveal error in law. That error went to the heart of the only issue in dispute on the tax evasion charge. The acquittal cannot stand.
[66] The acquittal was entered by a court composed of a judge and jury. Having concluded that the Crown appeal must be allowed, this court’s only option is to order a new trial: Criminal Code, s. 686(4)(b)(ii).
[67] At the new trial, Dr. Klundert will not be allowed to advance the “protestor” defence as I have held it is not a defence in law to the charge. That was the only defence advanced at his first trial. On the retrial, however, Dr. Klundert can advance any defence that is legally available to him.
So only Russ up to bat at the moment. Earned income in 2004-2008 and evasion occurred by not reporting it. He is also guilty of GST (goods and services tax) fraud as shown in count 3 and, as we will show in count 4, he committed the indictable offense of fraud.Count 1 I Chef 1
Russell Porisky, being of the City of Chilliwack, Province of British Columbia, between December 31, 2003 and December 4, 2008, did wilfully evade or attempt to evade the payment of taxes imposed by the Income Tax Act, by failing to report taxable income of Russell Porisky in the amount of $893,937.19, and did thereby evade the payment of $208,681.62 in income tax, contrary to section 239(l)(d) of the Income Tax Act.
For those of you interested in what the GST is here is Wikipedia's explanation,Count 3 I Chef 3
Russell Porisky, being of the City of Chilliwack, Province of British Columbia, between December 31, 2003 and December 4, 2008, did wilfully evade or attempt to evade compliance with the Excise Tax Act or payment or remittance of the Goods and Services Tax, by failing to collect or remit Goods and Services Tax of $66,133.45 on goods and services sold by Russell Porisky and Elaine Gould doing business as Paradigm Education Group, and did thereby commit an offence contrary to section 327(1)(c) of the Excise Tax Act.
The indictment ended on a very regal note.Count 4 I Chef 4
Russell Porisky, at or near the City of Chilliwack, Province of British Columbia, or elsewhere in the Province of British Columbia or other parts of Canada, between December 31, 2000 and December 4, 2008, did counsel, procure, solicit or incite various persons to commit the indictable offence of fraud in excess of five thousand dollars, contrary to section 380(1 )(a) of the Criminal Code, and did thereby commit an offence contrary to section 464(a) of the Criminal Code.
If Gould worked for Paradigm and made a taxable income from it then she evaded tax since she did not file any tax returns during the years in the indictment.)Count 2 I Chef 2
Elaine Gould, being of the City of Chilliwack, Province of British Columbia, between December 31, 2003 and December 4, 2008, did wilfully evade or attempt to evade the payment of taxes imposed by the Income Tax Act, by failing to report taxable income of Elaine Gould in the amount of $218,073.22, and did thereby evade the payment of $27,434.56 in income tax, contrary to section 239(1 )(d) of the Income Tax Act.
Well they apparently got permission. This is an awkward topic for Russ because Eva was (I believe) the first Poriskyite to face a tax evasion trial and she lost. Badly. This is the decision where the judge demolished Porisky's fable of tax-free natural persons;There are some legal documents we seized which we want to enter, including the Sydel case, which go to mens rea but we will need your ladyship's permission to enter them.
viewtopic.php?f=50&t=7827A bit of background is necessary. Eva Sydel, dentist and Poriskyite, was the first of Russell Porisky's crew to end up in court on tax evasion charges and to say she lost badly would be like saying Custer had a bit of a setback at the Little Big Horn. She actually forced the court to impose a jail sentence on her and, after she destroyed her life and lost her dental practice, found a new career as an obsessed serial litigant. She's discussed here;
This is the 56 page rebuttal to the Sydel decision that Russ wrote up telling why Judge Meyer totally screwed it up by finding Sydel guilty.Her conviction set the stage for all the Porisky/Paradigm trials to follow, endangering Porisky's gravy train so it behooved (never used that word before!) him to show his followers why the decision was wrong and his theories were still correct. In 2006 he coughed up a 56 page detailed analysis of why the entire Sydel decision was just a judicial mockery. Given the number of Poriskyite followers who have been convicted since this magnificent piece of legal analysis was penned the only rational explanation is corruption in the courts.
While I won't go into detail (read it yourself if you are interested) his overriding point seems to be that Parliament has, for more than eighty years, failed to use clear and unequivocal words to directly include "natural person" in the definition of "person" in the Income Tax Act. This clearly means, to anyone with an IQ higher than that of a turnip, that natural persons were deliberately left out of the definition because Parliament had decided that natural persons are not taxable.
Seems pretty conclusive to me. Of course a devil's advocate might bring up the alternative view that it was not included because Porisky fabricated the whole natural person scam, along with inventing an entirely imaginary new category of "person", long after the definition of person was included in the act. Also it could be concluded, as the courts have had no problem doing, that the definition of person is all-encompassing so there is no such thing as a natural person to include or exclude for tax purposes. But I suppose that's just me nit-picking.
Porisky also went into great detail to show how the lazy crown counsel just assumed, for purposes of arguing a criminal case, that the word "includes" is a term of expansion that adds to a definition instead the actual common sense understanding of the word which clearly means only those things specifically mentioned after the word "includes" in the definition.
I'll give my own example to show how absurd the crown's position was. Let's say that your granny's recipe for chocolate chip cookies says to include baking powder. The crown's ludicrous understanding of the meaning of "includes" would open the door for the recipe to have other ingredients like chocolate chips, flour, sugar, raw garlic, whatever, in it. This is so imprecise as to be meaningless, who can make sense out of it? In Porisky's legally incisive definition of "includes" granny's chocolate chip cookies recipe would contain nothing but baking powder. Now isn't that far more logical?
Porisky concluded with the sobering thought that if Sydel's guilty conviction was allowed to stand the CRA was going to go on to the next phase of their program; charging all our children with criminal tax evasion for not paying taxes on their allowances. That clearly follows.
The SCC said;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.
Stewart v. Canada, [2002] 2 SCR 645, 2002 SCC 46The “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.
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.
There's nothing on Google News about the conviction which is weird because there were plenty of articles about Porisky getting a re-trial.the jury had decided by 9:20 and found P&G guilty on all counts.
They're so familiar with Lindsay that they recognize his face and remember his name?!At break I heard Crown counsel say "I wonder what David Lindsay was doing in court today".
Sounds like it would be interesting to have heard.At this point the judge started discussing the four hallmarks of fraud but I couldn't keep up so I let that one go while I finished prior charges.
Crown counsel recognized Lindsay because he made a fuss at one of Debbie Anderson's hearings trying to get the court's permission to represent her. Same Crown counsel in Anderson and Porisky.Jeffrey wrote:There's nothing on Google News about the conviction which is weird because there were plenty of articles about Porisky getting a re-trial.the jury had decided by 9:20 and found P&G guilty on all counts.
They're so familiar with Lindsay that they recognize his face and remember his name?!At break I heard Crown counsel say "I wonder what David Lindsay was doing in court today".
Sounds like it would be interesting to have heard.At this point the judge started discussing the four hallmarks of fraud but I couldn't keep up so I let that one go while I finished prior charges.
Not today. If you check the Supreme Court of British Columbia's daily hearing list you'll find a dozen hearings scheduled for courtroom 71 at 2:00.JurisEquity wrote:Chilliwack couple convicted again in retrial of income tax evasion scheme
http://www.theprovince.com/news/chilliw ... story.html
Chilliwack couple convicted again in retrial of income tax evasion scheme
http://www.ottawacitizen.com/news/chill ... story.html
The sentencing is today.
http://www2.gov.bc.ca/gov/content/justi ... g-sentenceDeciding on a Sentence
Sentencing decisions are made by the judge based on:
The law in relation to minimum and maximum sentences in the Criminal Code of Canada and Youth Criminal Justice Act
decisions of higher courts on similar cases.
Judges are also guided by decisions of other judges at the same or lower court levels. They may also consider the victim impact statement, witness statements and victim and witnesses’ testimony when determining the sentence.
Finally, the judge can also request a pre-sentence report. A pre-sentence report is prepared by a probation officer to help the court learn more about the person to be sentenced. The probation officer will usually speak to the person about their education and family background, health concerns and prior convictions. The probation officer may also contact the offender’s family and friends or any other people suggested by the offender who may be able to help the court understand the person and their situation.
Copies of the report will be sent directly to the court, Crown counsel and defence counsel before the sentencing hearing.
Paradigm teachings were the antithesis to the rule of law. Porisky's culpability is high because his home was full of caselaw that accurately showed he was wrong but this was ignored. He has a very high moral culpability.Mens Rea. As an element of criminal responsibility, a guilty mind; a guilty or wrongful purpose; a criminal intent. Guilty knowledge and wilfulness. A fundamental principle of Criminal Law is that a crime consists of both a mental and a physical element.
The comment about him being a natural person may have come up in this transcript. I'm not going though it this late at night to check. I have to be up early for yet another court hearing. The Poriskyite trials are relentless.He actually got off of this one. Absolutely nothing to do with how he presented his case. He was charged with not filing his 1994 to 1997 income tax returns but the judge wasn't convince that the Crown had done a thorough enough search to prove he hadn't filed. The CRA had checked the records in the Vancouver and Burnaby-Fraser tax offices, the two possible offices where somebody like Russ, who lived in Chilliwack B. C., would be assumed to have filed his returns. But judge said they hadn't checked every tax office in Canada. Who knows, a local Vancouver area carpenter might have flown to Montreal or Halifax, filed there, and flown home. It's possible! So Russ was acquitted. I assume this only encouraged him.
Crown commented on paragraph 87 of Meads which covered the Paradigm scheme and the "good slave" comment in paragraph 91. This is what Meads said about Porisky and Paradigm;[70] These Reasons in many instances identify reported caselaw that comments on OPCA litigants, OPCA gurus, and their misconduct. It should be understood that the reported caselaw is the proverbial tip of the iceberg. The vast majority of encounters between this Court and OPCA litigants are not reported. These litigants and their schemes have been encountered in almost all areas of law. They appear in chambers, in criminal proceedings, initiate civil litigation based on illusionary OPCA rights, attempt to evade court and state authority with procedural and defence-based schemes, and interfere with unrelated matters.
[71] OPCA strategies as brought before this Court have proven disruptive, inflict unnecessary expenses on other parties, and are ultimately harmful to the persons who appear in court and attempt to invoke these vexatious strategies. Because of the nonsense they argue, OPCA litigants are invariably unsuccessful and their positions dismissed, typically without written reasons. Nevertheless, their litigation abuse continues. The growing volume of this kind of vexatious litigation is a reason why these Reasons suggest a strong response to curb this misconduct.
[72] Beyond that, these are little more than scams that abuse legal processes. As this Court now recognizes that these schemes are intended for that purpose, a strict approach is appropriate when the Court responds to persons who purposefully say they stand outside the rules and law, or who intend to abuse, disrupt, and ultimately break the legal processes that govern conduct in Canada. The persons who advance these schemes, and particularly those who market and sell these concepts as commercial products, are parasites that must be stopped.
[73] A critical first point is an appreciation that the concepts discussed in these Reasons are frequently a commercial product, designed, promoted, and sold by a community of individuals, whom I refer to as “gurus”. Gurus claim that their techniques provide easy rewards – one does not have to pay tax, child and spousal support payments, or pay attention to traffic laws. There are allegedly secret but accessible bank accounts that contain nearly unlimited funds, if you know the trick to unlock their gates. You can transform a bill into a cheque with a stamp and some coloured writing. You are only subject to criminal sanction if you agree to be subject to criminal sanction. You can make yourself independent of any state obligation if you so desire, and unilaterally force and enforce demands on other persons, institutions, and the state. All this is a consequence of the fact gurus proclaim they know secret principles and law, hidden from the public, but binding on the state, courts, and individuals.
[74] And all these “secrets” can be yours, for small payment to the guru.
In Crown's submission there is no question that the intent was to draw people into an OPCA scheme. Community impact more broad than in Knox Contracting decision.1. Russell Porisky and the Paradigm Education Group
[87] Typically, this Court has learned about gurus and their activities from the perspective of an outside observer. For example, in court, justices see litigants identify certain persons who provide assistance or guidance to an OPCA litigant. Some gurus have appeared before justices of this Court and have directed (or appear to direct) the OPCA litigant’s conduct, or attempt to represent the OPCA litigant.
[88] Recently, a more complete window into the operations of an OPCA guru and his customer base has been provided by the trial and conviction (R. v. Porisky, 2012 BCSC 67 (CanLII), 2012 D.T.C. 5037 [“Porisky Trial Decision”]) and sentencing (R. v. Porisky, 2012 BCSC 771 (CanLII) [“Porisky Sentencing Decision”]) of Russell Porisky and Elaine Gould for tax evasion and counseling others to commit fraud. R. v. Sydel, 2006 BCPC 346 (CanLII) also reports on the Porisky operation but from the perspective of one customer, a dentist. These cases provide many details on how an OPCA scheme operates.
[89] Porisky operated a business, named “The Paradigm Education Group”, that advanced a concept that it was possible for a potential taxpayer to:
... structure their affairs so that they were a “natural person, working in his own capacity, under a private contract, for his own benefit”. Paradigm taught that money earned under this arrangement was exempt from income tax.
(Porisky Trial Decision, at para. 1)
[90] Porisky claimed this was in response to a banking conspiracy:
He founded what he eventually called The Paradigm Education Group to “create a structure that everyone could work together in to save the country from a foreign parasite”. The foreign parasites were the international bankers who were, directly or indirectly, responsible for the income tax system.
(Porisky Trial Decision, at para. 38)
[91] Porisky taught that the Canada Revenue Agency had tricked persons into believing there was an obligation to pay tax, and further that taxation is slavery, serfdom, and contrary to the Canadian Bill of Rights: para. 111. Justice Myers helpfully isolates representative examples of the alternative reality and rhetoric Porisky directed to his customers in the Appendix to the trial decision. It is typical that a guru will frame his or her arguments in a conspiratorial context, and claim that the potential customer has been cheated. The state is an enemy and oppressive. A few sample passages illustrate Porisky’s perspective on the world:
... When I was a good slave I dismissed my thoughts because I was taught that I was incapable of understanding the superior wisdom of my elected officials. The more I studied though, the freer my mind grew and the clearer it became. They never had some kind of superior wisdom as I had been taught, in fact it became painfully clear that many of them could not or would not even think for themselves ...
...
As far as propaganda goes, the “National Post” article was a great textbook example of promoting a victim mentality. It seems to stimulate sympathy for our poor federal government, while painting everyone who doesn’t submit to their national plundering program as a criminal. Nevertheless, it was a great read, I laughed, I cried and I’ll definitely want to read it again when I feel like being shamed into feeling that I should waive my natural rights so our government can keep its trough full enough to ensure their fiscal mismanagement can continue unabated.
...
This mental shift toward total government dependence is what will allow the implementation of the banker’s ultimate agenda, a New World Order run by a One World Government that they control.
...
... The choice is yours, but consider this, ignorance may be bliss, but it costs you plenty.
[92] I will not review the basis on why Porisky’s “natural person” scheme is incorrect, as this question is thoroughly dissected in reported cases including: R. v. Klundert, 2008 ONCA 767 (CanLII) at para. 19, 93 O.R. (3d) 81, leave denied [2008] S.C.C.A. No. 522; R. v. Lindsay, 2011 BCCA 99 (CanLII) at para. 27, 302 B.C.A.C. 76, leave refused [2011] S.C.C.A. No. 265; R. v. Pinno, 2002 SKPC 118 (CanLII) at paras. 12-13, 15-16, [2003] 3 C.T.C. 308; Kennedy v. Canada (Customs and Revenue Agency), 2000 CanLII 22837 (ON SC), [2000] 4 C.T.C. 186, 2000 D.T.C. 6524 (Ont. Sup. Ct. J.); and Porisky Trial Decision at paras. 58-61.
[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 (CanLII), at para. 21, as are other participants in the Porisky tax evasion ring: R. v. McCartie, 2012 BCSC 928 (CanLII). Many other persons who used Porisky’s techniques have already been convicted of tax evasion: Porisky Trial Decision, at para. 63.
[94] Additionally, and in what can only be described as an exercise in pure arrogance, Porisky demanded 7% of the next two years income from his subscribers in exchange for his or his educator’s assistance: Porisky Trial Decision, at para. 40. The tax liberator had become a tax collector.
[95] The pseudolegal basis for Porisky’s claims is very representative of how OPCA arguments are rationalized and explained by their proponents. Statutes, caselaw (often foreign or obsolete), legal platitudes and definitions (again often foreign or obsolete), political ideology, and conspiracy, were strung together into a loose cloud that pointed to a desired result. Justice Myers eloquently described this process at para. 67 of the trial decision:
Mr. Porisky’s analysis picks and chooses snippets from various statutes and cases, and attempts to create logical links where none exist. It is, in effect, legal numerology.
[96] It is important at this point to again stress the audience for Porisky’s ideas. That was not the courts, government actors, but his clientele. What mattered was that his customer base believe and then pay for his services.
[97] Porisky was convicted and sentenced for having personally evaded taxes, and having aided and abetted the evasion of income tax. Justice Myers rejected a disclaimer by Porisky that his ideas, materials, and advice were for “educational purposes only”: Porisky Trial Decision, at para. 98. Porisky had gone so far as to prepare (unsuccessful) legal arguments for one of his clients who had been sued for tax evasion. Porisky then analyzed that result, and told his subscribers why the client’s conviction was “ambiguous” and “... just another desperately needed bowl of propaganda pabulum for public consumption, to keep the masses asleep and enslaved ...” [sic]: paras. 118�121.
[98] In total, Porisky’s guru activities led to substantial tax evasion, which was difficult to quantify with precision: Porisky Sentencing Decision, at paras. 38�40. He had approximately 800 “students” who applied his scheme: at para. 40. A 4.5 year prison sentence was ordered: para. 57.
This was a seminal case. Not only were taxes diverted through Porisky's scheme there was an increased need for expenditures by both the CRA and Justice.It is fitting and appropriate that the s. 239 offences be considered as criminal law. The Income Tax Act is a major source of funds for the federal government. Its provisions are applicable to most adult Canadians. The vast majority pay their income tax by way of payroll deduction with little or no opportunity for evasion or misstatement. Those who do evade the payment of income tax not only cheat the State of what is owing to it, but inevitably increase the burden placed upon the honest taxpayers. It is ironic that those who evade payment of taxes think nothing of availing themselves of the innumerable services which the State provides by means of taxes collected from others.
The entire system of levying and collecting income tax is dependent upon the integrity of the taxpayer in reporting and assessing income. If the system is to work, the returns must be honestly completed. All taxpayers have the right to know that it is a criminal violation to commit any of the offences described in s. 239. The Act imposes a public duty. A breach of that fundamentally important public duty should constitute a criminal offence.
viewtopic.php?f=50&t=11111&p=228057#p228057This time I didn't make the same boozy mistake as yesterday. I had an iconic Vancouver lunch, corned beef hash and coffee at the Ovaltine Cafe, just down the block from the courthouse. The Ovaltine is virtually unchanged, inside and out, since its opening in 1942 and is a Vancouver landmark. One of the very few classic 1930's and WWII greasy spoons left in Vancouver.
It still has its original neon sign from 1942.
I always sit at the counter just behind where the new owners are standing
If the sentences are concurrent, how is this an increase?Astute followers of Porisky's saga will note that he had been originally sentenced to a four year jail term in 2012. Today the judge increased this by eighteen months.
My mistake! I meant consecutive. I'll change it.Dr. Caligari wrote:If the sentences are concurrent, how is this an increase?Astute followers of Porisky's saga will note that he had been originally sentenced to a four year jail term in 2012. Today the judge increased this by eighteen months.
This is the section under the Excise Tax Act that they were charged under;239 (1) Every person who has
(a) made, or participated in, assented to or acquiesced in the making of, false or deceptive statements in a return, certificate, statement or answer filed or made as required by or under this Act or a regulation,
(b) to evade payment of a tax imposed by this Act, destroyed, altered, mutilated, secreted or otherwise disposed of the records or books of account of a taxpayer,
(c) made, or assented to or acquiesced in the making of, false or deceptive entries, or omitted, or assented to or acquiesced in the omission, to enter a material particular, in records or books of account of a taxpayer,
(d) wilfully, in any manner, evaded or attempted to evade compliance with this Act or payment of taxes imposed by this Act, or
(e) conspired with any person to commit an offence described in paragraphs 239(1)(a) to 239(1)(d),
is guilty of an offence and, in addition to any penalty otherwise provided, is liable on summary conviction to
(f) a fine of not less than 50%, and not more than 200%, of the amount of the tax that was sought to be evaded, or
(g) both the fine described in paragraph 239(1)(f) and imprisonment for a term not exceeding 2 years.
Prosecution on indictment
(2) Every person who is charged with an offence described in subsection 239(1) or 239(1.1) may, at the election of the Attorney General of Canada, be prosecuted on indictment and, if convicted, is, in addition to any penalty otherwise provided, liable to
(a) a fine of not less than 100% and not more than 200% of
(i) where the offence is described in subsection 239(1), the amount of the tax that was sought to be evaded, and
(ii) where the offence is described in subsection 239(1.1), the amount by which the amount of the refund or credit obtained or claimed exceeds the amount, if any, of the refund or credit to which the person or other person, as the case may be, is entitled; and
(b) imprisonment for a term not exceeding 5 years.
And this is the section of the Canadian Criminal Code covering counseling fraud. Porisky was charged under this section;327 (1) Every person who has
(a) made, or participated in, assented to or acquiesced in the making of, false or deceptive statements in a return, application, certificate, statement, document or answer filed or made as required by or under this Part or the regulations made under this Part,
(b) for the purpose of evading payment or remittance of any tax or net tax payable under this Part, or obtaining a refund or rebate to which the person is not entitled under this Part,
(i) destroyed, altered, mutilated, secreted or otherwise disposed of any documents of a person, or
(ii) made, or assented to or acquiesced in the making of, false or deceptive entries, or omitted, or assented to or acquiesced in the omission, to enter a material particular in the documents of a person,
(c) wilfully, in any manner, evaded or attempted to evade compliance with this Part or payment or remittance of tax or net tax imposed under this Part,
(d) wilfully, in any manner, obtained or attempted to obtain a rebate or refund to which the person is not entitled under this Part, or
(e) conspired with any person to commit an offence described in any of paragraphs (a) to (c),
is guilty of an offence and, in addition to any penalty otherwise provided, is liable on summary conviction to
(f) a fine of not less than 50%, and not more than 200%, of the amount of the tax or net tax that was sought to be evaded, or of the rebate or refund sought, or, where the amount that was sought to be evaded cannot be ascertained, a fine of not less than $1,000 and not more than $25,000, or
(g) both a fine referred to in paragraph (f) and imprisonment for a term not exceeding two years.
(2) Every person who is charged with an offence described in subsection (1) may, at the election of the Attorney General of Canada, be prosecuted on indictment and, if convicted, is, in addition to any penalty otherwise provided, liable to
(a) a fine of not less than 100%, and not more than 200%, of the amount of the tax or net tax that was sought to be evaded, or of the rebate or refund sought, or, where the amount that was sought to be evaded cannot be ascertained, a fine of not less than $2,000 and not more than $25,000, or
(b) both a fine referred to in paragraph (a) and imprisonment for a term not exceeding five years.
This is how Wikipedia describes indictable offenses in Canada;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.
Since Porisky and Gould were both charged with indictable offenses the maximum penalties applied.In many common law jurisdictions (e.g., England and Wales, Ireland, Canada, Hong Kong, India, Australia, New Zealand, Malaysia, Singapore), an indictable offence is an offence which can only be tried on an indictment after a preliminary hearing to determine whether there is a prima facie case to answer or by a grand jury (in contrast to a summary offence). In the United States, a crime of similar severity and rules is called a felony, which also requires an indictment.
You can read this yourselves in the transcript of the hearing on page 84;To get started here are the transcripts from his very first tax trial, back in 1999. Failing to file tax returns. He was employing his "I'm not me" dual personality defence routine even then:
.........
He actually got off of this one. Absolutely nothing to do with how he presented his case. He was charged with not filing his 1994 to 1997 income tax returns but the judge wasn't convince that the Crown had done a thorough enough search to prove he hadn't filed. The CRA had checked the records in the Vancouver and Burnaby-Fraser tax offices, the two possible offices where somebody like Russ, who lived in Chilliwack B. C., would be assumed to have filed his returns. But judge said they hadn't checked every tax office in Canada. Who knows, a local Vancouver area carpenter might have flown to Montreal or Halifax, filed there, and flown home. It's possible! So Russ was acquitted. I assume this only encouraged him.