Keith David Lawson - Poriskyite Tax Evader

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Re: Another Canadian Sovereign (Keith David Lawson)

Postby grixit » Fri May 06, 2016 6:40 pm

Solvang started as a real danish colony. For a couple of generations it remained a majority danish speaking area. The local grammar school had an english department which taught bookkeeping; the idea being that the only people who'd need English would be those looking for office jobs outside the community. The worship of Hans Christian Andersen started early on, the tourist part developed naturally as the population of California grew and the highways were put in.

However. There've been two big changes lately.

1. California has gotten very heavily into wine. There are vineyards everywhere now and a lot of other businesses are converting over. And in that area, Solvang/Buellton/Santa Ynez, that includes places that used to raise sheep for the danish textile crafts. Also, cafes and coffee houses are being replaced by wine bars or even wine tasting rooms, which bring a different cultural feel a sort of neo-yuppieness.

2. The local casino, and its owners, the Chumash indians, are really booming. Chumash are buying up land for expansion and at least tacitly supporting the wine industry, and eclipsing the danish flavor with their advertising. Yup, natives encroaching on europeans, who saw that coming?


btw: i myself don't drink alcohol, but i'd be happy to watch you down a pint while i had a dr pepper.
I voted for Hillary, and i didn't even get a stupid tshirt!

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Re: Another Canadian Sovereign (Keith David Lawson)

Postby Burnaby49 » Fri May 06, 2016 6:47 pm

notorial dissent wrote:I was under the impression that the Amargosa had closed.


As a bonus they're even planning to open a restaurant. At the moment Death Valley junction is a ghost town. Apart from the hotel and Opera House there is nothing. No gas station, bar, restaurant, nothing. The hotel has a large dining room but it's probably been decades since they served food there. The hotel is working on re-opening a nearby restaurant that closed years ago but hadn't finished by the time we arrived. So we had to leave California and drive all the way to Nevada (seven miles) to get dinner at a small casino right on the state border. After we'd shared a burger Mrs. Burnaby49 started playing penny slots (they actually had penny slots) and won $103 almost immediately.
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Re: Another Canadian Sovereign (Keith David Lawson)

Postby Burnaby49 » Fri May 06, 2016 6:52 pm

Focus, I have to focus. I still have two days of Keith's saga to post. It all concludes with the judge removing almost all of the publication bans relating to Keith and me saying a few totally pointless words in court. And the convictions of course but, being useless at building up narrative tension, I've already given the ending away. Well we still have the sentencing.
"Yes Burnaby49, I do in fact believe all process servers are peace officers. I've good reason to believe so." Robert Menard in his May 28, 2015 video "Process Servers".

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Re: Another Canadian Sovereign (Keith David Lawson)

Postby notorial dissent » Sat May 07, 2016 7:40 am

Lawson is, at the very least, just addled, to put it kindly. His judge had to have had incredible patience. Aside from the fact I think he is flat out delusional. Although maybe he he does qualify since he has quite obviously drunk deep of the koolaid, and that one leaves a very long lasting hangover.
The fact that you sincerely and wholeheartedly believe that the “Law of Gravity” is unconstitutional and a violation of your sovereign rights, does not absolve you of adherence to it.

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Re: Another Canadian Sovereign (Keith David Lawson)

Postby Burnaby49 » Sat May 07, 2016 8:19 am

Tuesday May 03, 2016

The big day. Lawson's closing arguments. However, before trial started, yet another issue right out of left field. Crown counsel said that she and her co-counsel were just accosted on the street right outside the courthouse by an individual who said to the two of them "You're done and he's saying crazy things." (not me, honest!) Problem was that Crown counsel recognized one of our jurors nearby who might have overheard this so Crown was concerned about possible prejudice to Lawson. So judge went into explaining process. Did the juror hear anything? If so what did she hear? Did juror think that what was overheard biased her against Lawson? Crown of course didn't know juror's name but she could point out chair she was sitting in the jury box. This was matched to the jury chart, juror identified, and brought into court. Judge explained situation vaguely. This is nothing to do with you personally. You may have inadvertently just heard something said on corner outside of courthouse. Did you hear anything said to crown counsel? No. I saw something but heard nothing. Juror sent back then entire jury let in and it was time for Lawson's closing submissions.

First a note. I'll try and refrain from making personal comments on what he says as I go through except for one point where I felt impelled to respond to one of his statements. You'll be reading it in two minutes. Apart from that I'll just try to record what I heard apart from expanding at some points to explain what he was referring to. Particularly in respect to the Stewart case that he seemed to think was some kind of holy grail.

Good afternoon. This is the first time that I've done this. My submission does not have a lot to do with the exhibits. If you can't hear me please raise your hands. I for one couldn't hear him properly. I was sitting near the open door at the back of the court and there seemed to be a party going on outside. In addition Lawson was to my right talking to the jurors further to my right. So I abandoned my seat and moved over to the far end of the seating where I could see and hear him clearly.

I'd like you to remember that what you heard here yesterday is only the Crown's theory and interpretation of evidence. Crown said that the only alternatives for defining work are employee or self-employed. This conflicts with human rights. He mentioned the Magna Carta and his common law rights. Crown implies that everyone is born into bondage. This is incompatible with freedom, privacy, and property rights.

He suggested a "common sense" alternative to Crown's theory. He'd spent several years of work with concerned citizens trying to figure out his human rights. This case is not about money but about fundamental rights. There is uncertainty in the definitions in the Act (Income Tax Act). The Act does mot make common sense, it is too complex. You will have difficulty determining income in the Act but you must determine this to find if I had income under the Act.

I tried to understand about liberty and privacy. I found evidence in favour of my being a natural person. The Bill of Rights applies to natural persons. My research indicated that natural persons are not defined in "person" in the Income Tax Act so I considered alternatives.

In 2002 I realized that the Income Tax Act was constitutional. There was a way that I could be subject to it through my SIN (Social Insurance) number or accepting benefits such as social security or EI (Employment Insurance) so he said he chose not to accept these government benefits.

This is where I have to comment. He was very careful in stating what specific government benefits he chose not to accept. But there was a glaring omission. He didn't mention the elephant in the room, the biggest benefit of all, our free medical system. At least free in the sense that users are not charged but we taxpayers pay a huge amount to fund it. It covers the majority of medical costs. It doesn't cover dental work, prescription drugs, wacky stuff like naturopaths (at least I think it doesn't), routine eye tests or glasses. But it does cover doctor's visits, specialists, surgery, including eye surgery, hospital stays, cancer or other disease treatment, the huge costs that can bankrupt you. A few years back I stumbled down some stairs and ended up incapacitated in intensive care in Burnaby General for over a week with five broken ribs. I got excellent care and it was all "free". Lawson somehow neglected to explain how his principled stand against the government's unwarranted power to tax him also allowed him to make copious use of the free medical benefits he's been enjoying. Just in this trial alone his whole family has been admitted to hospital or been treated in emergency. His son was at Children's Hospital, a specialized and expensive facility. When testifying about his medical problem he went though a whole range of procedures he'd been through, including surgery, all paid for through taxes that he's been found to have criminally evaded.

Now let's talk about the benefits that he virtuously noted that he had voluntarily chosen not to accept. Social Security? That's the government's pension plan that he's not yet qualified to claim because he is too young. Noble of him to turn that down when he can't get it anyhow but let's wait twenty years or so and see if his position changes. What about EI? This is a quick description from Wikipedia;

In Canada, the system now known as Employment Insurance was formerly called Unemployment Insurance. The name was changed in 1996, in order to alleviate perceived negative connotations. In 2015, Canadian workers pay premiums of 1.88%[4] of insured earnings in return for benefits if they lose their jobs. Employers contribute 1.4 times the amount of employee premiums. Since 1990, there is no government contribution to this fund. The amount a person receives and how long they can stay on EI varies with their previous salary, how long they were working, and the unemployment rate in their area. The EI system is managed by Service Canada, a service delivery network reporting to the Minister of Employment and Social Development Canada.


https://en.wikipedia.org/wiki/Employment_insurance#Canada

The problem with EI, for income tax evaders, is that you have to be an employee to be qualified to claim any benefit from it. But employees in Canada have taxes deducted from their income at source by their employer and remitted directly to the CRA on their behalf. Additionally the employer sends the CRA an annual statement (the T4 slip) stating exactly what each employee has earned. So the Paradigm tax evasion scheme won't work if you are an employee. That's why Carl Gustafson quit as an employee of his own company and instead worked for it as a sub-contractor. Sub-contractors aren't issued T4 slips and don't have income deducted at source.

No doubt Lawson has a well reasoned and principled explanation of why he can demand that he be given full use of our free medical system while severing himself from any responsibility for paying to help support it. However he did not give this explanation in court. Perhaps he forgot in the stress of the moment. I'd noted immediately after he made his comment about not accepting benefits that he'd left medical out of the very short list of benefits he said that he'd declined to accept. I'd bet all of the jury members noticed it too.

OK, hissy-fit over. Back to his statement. A supreme Court of Canada case taught him that legislation had to use clear and direct language. I had a reasonable doubt because the Act was not clear and direct. Then on to Blacks legal dictionary. Then Section 92 of the British North America Act. Subsections 13 and 16 which indicate that property rights are provincial, not federal. Section 2 of the Bill of Rights allows interpretation to be adapted to not adversely affect human rights and fundamental freedoms.

These are the cited sections;

92. In each Province the Legislature may exclusively make Laws in relation to Matters coming within the Classes of Subjects next hereinafter enumerated, that is to say,

13. Property and Civil Rights in the Province.

16. Generally all Matters of a merely local or private Nature in the Province.


Construction of law

2 Every law of Canada shall, unless it is expressly declared by an Act of the Parliament of Canada that it shall operate notwithstanding the Canadian Bill of Rights, be so construed and applied as not to abrogate, abridge or infringe or to authorize the abrogation, abridgment or infringement of any of the rights or freedoms herein recognized and declared, and in particular, no law of Canada shall be construed or applied so as to

(a) authorize or effect the arbitrary detention, imprisonment or exile of any person;

(b) impose or authorize the imposition of cruel and unusual treatment or punishment;

(c) deprive a person who has been arrested or detained
(i) of the right to be informed promptly of the reason for his arrest or detention,
(ii) of the right to retain and instruct counsel without delay, or
(iii) of the remedy by way of habeas corpus for the determination of the validity of his detention and for his release if the detention is not lawful;

(d) authorize a court, tribunal, commission, board or other authority to compel a person to give evidence if he is denied counsel, protection against self crimination or other constitutional safeguards;

(e) deprive a person of the right to a fair hearing in accordance with the principles of fundamental justice for the determination of his rights and obligations;

(f) deprive a person charged with a criminal offence of the right to be presumed innocent until proved guilty according to law in a fair and public hearing by an independent and impartial tribunal, or of the right to reasonable bail without just cause; or

(g) deprive a person of the right to the assistance of an interpreter in any proceedings in which he is involved or in which he is a party or a witness, before a court, commission, board or other tribunal, if he does not understand or speak the language in which such proceedings are conducted.


The testimony you have heard does not show I was attempting to commit fraud but to find human rights and fundamental freedoms. I wanted to understand the true purpose and intent of the law.

Then on to Carl Gustafson. Carl testified that I told him certain things. He seemed to imply that I was the basis of his actions but on cross he and Allen (Curle) and Bruce (Johnson) did their own research on the law. I did not seek them out. Carl testified that he spent a lot of time trying top find flaws in the theory but could not. The more detailed explanation he gave differed from original. There were definite inconsistencies between direct and cross-examination. Carl testified that he spent a lot of his own time researching this and found no conflict with what I told him. Carl testified that I didn't push him or promote things. He relied voluntarily on his own understanding. You, ladies and gentlemen, are judges of the benefit. Carl testified that I'd provided court decisions for his research.

Note - At this point I just couldn't keep up so I had to paraphrase for a bit.

Lawson's agreement was that Carl did everything he did freely and voluntarily after doing his own research and convincing himself.

The Paradigm agreement between me and Carl was between two natural persons which led us to believe this was expressing our private rights which added to my doubts that the tax act applied to me. The fact that I helped Carl after he stopped paying me showed that what I did was a hobby not a business. This gives you reasonable doubt that I had a business.

Then Lawson discussed the "Stanchfield ruling". These are the two Stanchfield judgments;

Canada (National Revenue) v. Stanchfield, 2009 FC 72
http://canlii.ca/t/22bqk

Canada (National Revenue) v. Stanchfield, 2009 FC 99
http://canlii.ca/t/22g7x

Cory (Stanchfield) gave a talk discussion it. It was only at that point that we questioned the theory. Why the delay between 2002 and 2009? We sent 1,140 registered letters to MLAs (Members of Legislative Assemblies. These are provincial government elected members)and MPs (Members of Parliament, elected federal representatives). Nobody answered a simple question about how the tax act intended to infringe on rights of a natural person. The biggest word to question in the Act is income and income is not defined in the Act so Carl had reasonable doubt that he made income. Lawson said that his advice to keep paperwork accurate gives reasonable doubt. He said he told Carl to be upfront and expect to be called on paperwork. I had not told him to conceal or hide anything. This is inconsistent with Crown's theory that I was counseling fraud.

The letters to MPs open reasonable doubt. You don't invite government to investigate you. Carl had doubts about what his understanding of Income was because of the complexity of the Act. Lawson said that neither he nor Carl could honestly sign on the bottom of their tax returns that they were complete and correct.

Since the intent and purpose of our actions was to (?) private rights there is no evidence of fraud. We were trying to avoid becoming liable for tax not refusing to comply with the Act. We were trying to make our affairs outside of the Act and if we failed we could show mens rea that we tried and failed to meet our obligations. I shared the same intent as Carl that we avoid being liable for tax, not avoiding a known payment. If we were mistaken in that it was an honest mistake.

Then he discussed hobbies. Hobbies are not taxable (note - not true if you make a profit on them). He brought up the Stewart case (which he'd apparently tried to inform the jury about but was denied. I'd guess because he was trying to discuss law which is the judge's role). The Stewart case provided source of income test. The Crown is here to win not to help me and presents evidence that helps them.

Time for a bit of a digression while I bring up Stewart on Lawson's behalf because he mentioned it frequently during the trial to the point that he seemed to imply that it was the smoking gun that would exonerate him but the Crown and Court weren't allowing him to present it.

This is the case;

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

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.

Back to Keith. The Crown's evidence was mostly about money and that is most irrelevant thing in this case. What was important was, was it compensation for private property or was it income? The problem I have with the process is how can anyone define the words in the Act? What is residence? President Clinton asked what is definition of its? Some of the definitions are in evidence. Crown says the use is common sense but common sense is not applicable to words not defined.

I have to say that at this point he was losing me. And he got the President Clinton issue a bit wrong, Clinton stumbled over "is";

A much-quoted statement from Clinton's grand jury testimony showed him questioning the precise use of the word "is." Contending that his statement that "there's nothing going on between us" had been truthful because he had no ongoing relationship with Lewinsky at the time he was questioned, Clinton said, "It depends upon what the meaning of the word 'is' is. If the—if he—if 'is' means is and never has been, that is not—that is one thing. If it means there is none, that was a completely true statement".


The case is not about whether I received money but whether I received income under the Income Tax Act. I left money off of my income tax return because there was a doubt that it was income. I was concerned that people were not taking their freedoms seriously.

In this prosecution there is no victim. Carl didn't blame me. All of my students joined voluntarily. Crown suggests that I knew that what I did was illegal. These freedoms and rights are important and somebody has to find the answers. I am saying to you today to find a reasonable doubt that I was doing anything other than that. Then he went on about something to do with his mother's accountant that I was to far behind to catch.

I believe that my interpretations were well founded and I have nothing to hide. The Crown's theories are built on the flimsy assumption that the government is entitled to all the money everybody makes. This is not true. (note - next few lines to break are confusing. I may have missed something, this is a straight reciting of my notes) The submission that everybody pays all the time does not make any sense. Then on about people without social insurance numbers. I think he was saying that people without SIN numbers didn't have to pay tax. Judge cut in and said time for a break. He asked for a few more moments.

This case hinges on three words, income, business, profit. Their meanings are not common sense and are engineered in the Act so common sense is not appropriate. In coming to your determination this is a process to bring the full force of the criminal courts and jail time against people who question them.

After the jury left the Crown said that she wanted to discuss inappropriate comments made throughout. There was a comment I'd apparently missed about the propriety of the CRA and prosecutions actions in prosecuting him. Also Lawson made a lot of inappropriate submissions on the law. SIN numbers are clearly not required before you have to pay income tax. He also referred may times to information not in evidence. (I'd noted this but not recorded it because it was peripheral and I just couldn't keep up with everything. He kept commenting about books he'd read that supported him in his quest to find the truth and from cases and documents not in evidence).

Counsel said that she was concerned about the mischaracterization of the Crown's submissions. Something else he'd said was entirely inappropriate. Judge agreed with the Crown. She told Lawson that he shouldn't comment on the law. She told Lawson that there were a number of points where she thought about stopping him and from this point on she will stop him if he talks about the law. His comments about SIN numbers were clearly incorrect and she would instruct the jury on this. A SIN number is not necessary to file tax returns.

The most serious comment was about the propriety of the CRA and the prosecution and discussing jail time. It is irrelevant and inappropriate and I will instruct the jury of this. Lawson said ""I didn't know that I shouldn't say these things" then it was our break.

Then jury back and Lawson resumed by saying that he was nearly done here. I'm past my notes and this may be less organized. One thing has occurred to me regarding the Crown's position is that it is for the Crown to decide if there is a business. Common sense raises reasonable doubt in my mind. If I had intended to be a business I would have had to accept the responsibilities of a business. Everyone has the right to do private things and I did not intend to be a business. If we accept the Crown's submissions then anybody could be deemed to have a business and retrospectively audited. Not fair and common sense says it isn't that way. In light of the testimony I've given about intent to be a business I don't believe that saying that you are not a business and avoiding the obligations of being a business are criminal acts. On and on about Stewart case then stopped to hint darkly that he was forced not to talk about some things.

I wasn't trying to obtain something that wasn't mine and nobody was deprived of something. Crown implies that all money and everything else is already theirs. If so the government owns all of our labour and money.

He said there were two further items. Most taxpayers know about notices of assessment which are bills of tax money owed. But there is no evidence of tax money owing in my case because the Crown didn't send a tax assessment against me. So there is a reasonable doubt.

Another doubt in my mind and maybe yours, a Crown witness that wasn't here. The Chief Investigator in my case. He wasn't here. The person who had the most knowledge wasn't here.

To accept the Crown's case we have to assume that the Crown owns all of our money, everything, our private rights and our right to make contracts. Common sense says otherwise. Stewart say that my private income as an educator is not taxable. (note - I invite readers to go through Stewart and find the slightest scrap of support there for this statement).

We saw evidence that since" natural person" is not in the Income Tax Act it shows a specific intention? Why isn't it? It's in the Bank Act, why not the Income Tax Act? Another common sense concern I have is the Crown's submission that your private rights and private property doesn't exist. You may also share that doubt. This conflicts with freedom, democracy and justice. We waive our rights because we are afraid and my actions are about this (He evaded tax for us!). I did a lot of work to do a reasonable interpretation. I chose to seek knowledge and lawfully gain private rights. I will leave it with your sense of justice to find me not guilty of these charges.

I thought that, overall, he did very well. I was expecting some crazed rant and was severely disappointed. He actually brought up some good points and presented his statement logically and very fluently. For all of the good that it did him.

Then the jury was excused while the judge and parties conferred. Judge asked Crown if she had any other matters before we concluded. Crown said that Lawson was over the line again about making statements on the law. A notice of assessment is not required to start and investigation. He discussed yet again about natural persons which is a matter of law. Crown wanted specific references about the statements Lawson made in the judge's charges to the jury. Lawson said that he tried to steer clear of a lot of things but may have slipped.

Jury back. At Crown's request judge instructed them that "You have heard evidence from Mr. Lawson that concluded interpretation of law. You have heard submissions from him that included interpretation of law. I repeat that I am the only source of the interpretation of law in this trial." Then jury dismissed for day.

Then some housekeeping to do with the judge's understanding of the charges that I won't get into. Entirely trivial.

Then judge said that after the jury was sequestered we will deal with the ban issue. She told Lawson that once the jury started deliberations he had to stay within a ten minute radius of the court because there may be jury questions. This also applied to the judge and Crown. This was in effect during hours of deliberation which were from 9:30 to 12:30, 2:00 to 6:30, and 8:00 to 9:30. This is the procedure for as long as it takes to get a decision. Lawson had concerns about getting home at night or family emergencies. Judge said she hoped nothing came up but she'd give him a sheriff contact number if he needed it. Lawson asked if these rules were in effect on the weekends. Yes. He was being optimistic about his chances since the jury didn't even need until the end of the today's scheduled time. Then the court adjourned until 10AM tomorrow.

To celebrate the end of the trial I went over to the Moose on the way home for wings and a beer. Don't bother to tell me that the trial, or at least my part in it, doesn't end until tomorrow. Tuesdays are half-price wings day at the Moose and we pensioners cut corners where we can.
"Yes Burnaby49, I do in fact believe all process servers are peace officers. I've good reason to believe so." Robert Menard in his May 28, 2015 video "Process Servers".

https://www.youtube.com/watch?v=XeI-J2PhdGs

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Re: Another Canadian Sovereign (Keith David Lawson)

Postby Jeffrey » Sat May 07, 2016 9:43 pm

That's why Carl Gustafson quit as an employee of his own company and instead worked for it as a sub-contractor. Sub-contractors aren't issued T4 slips and don't have income deducted at source.


Weird, I'm a contractor and my boss still has to send slips in. Gubmint knows exactly how much I been paid.

he said he chose not to accept these government benefits.

This is where I have to comment. He was very careful in stating what specific government benefits he chose not to accept. But there was a glaring omission.


One more glaring omission. Having the option of using those government benefits is itself a benefit. Compare going on a hike through the desert and going through a hike through a desert with with a water fountain within easy access.

Even if you don't use it, having that safety net there is a benefit.

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Re: Another Canadian Sovereign (Keith David Lawson)

Postby Burnaby49 » Sun May 08, 2016 8:05 am

Wednesday May 04, 2016

Home stretch and about time. Lawson is wearing me out. We started a half-hour late. Something to do with technical issues with the printers. Important because the judge had to print out the jury charges. Lawson had issues with the draft the judge had given him (I think) yesterday. The judge stopped him and told him that he could comment after she'd read the charges out to the jury.

Jury came in and each member got a copy of the printed charges. Judge said she was gong to red them, probably take about two hours, and that if there were differences between the printed copy and what she said the jury was to take her oral version as being correct.

This is how I reviewed the charges at Russell Porisky's trial;
http://www.quatloos.com/Q-Forum/viewtopic.php?f=50&t=10485&start=20#p222679

I'm not even going to pretend to give readers even an elementary review of the judge's charges. Once she started reading there was no way I could keep up and so I essentially relaxed and just tried to pick those points specifically relating to Lawson out of the flow and whatever else I could get. But keep in mind the judge spoke for two hours.

The judge said that she was going to read general rules of law that applied to all trials then specific rules of law that applied to this trial Reasonable doubt, what Crown needs to prove, a summary of parties positions in closing arguments, a list of what verdicts could be made for each charge. Note - This seems self-evident, guilty or not guilty but there was a choice of two guilty decisions they could make in 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.


The jury could, if they chose, find him guilty on this charge but of counseling fraud of less than five thousand dollars.

- In this trial I am the judge of the law and you are the determiners of fact. You are required to follow the law as I give it to you. You must accept the law from me without question. Not from the Crown or elsewhere.

- You must make your decision based only on the evidence presented in this court.

- Mr. Lawson does not have a lawyer. Do not guess why he does not. It is not part of the facts you must consider.

- Do not concern yourself with punishment or sentencing. That is irrelevant and has no place in the discussion. If you find him guilty it is my job to find the appropriate sentence.

- Ignore Facebook, internet, newspapers, television. Ignore all information from outside the courtroom. Consider only the evidence you have seen in this courtroom.

- A lot of boilerplate about deliberations, forming opinions, collaboration etc. Nuts and bolts of working together to arrive at a decision. You must determine if Crown counsel has determined guilt beyond a reasonable doubt.

- Evidence includes everything the witnesses said and what is in exhibits. Some things are not evidence including what the lawyers, Mr. Lawson, or I have said. The only evidence from Mr. Lawson is whatever he said on the witness stand. CRA officers affidavits are evidence and document (CRA records and bank records) are proven. The Crown is not required to have every possible witness testify.

- Assessing testimony. It is up to you how much you accept, all, some, or none. Lawson testified on his own behalf. You may believe some, all, or none of what he said. Apply the same factors as any other witness. Mr. Lawson's interpretation of the law must be disregarded. Judge compared Carl Gustafson and Lawson. Mr. Gustafson's guilty plea has no bearing on Mr. Lawson's guilt. Mr. Gustafson may have had many reason's for pleading guilty. You may take into account Mr. Gustafson's guilty plea when evaluating his testimony. He has a criminal record comprised only of his guilty plea. It is up to you to say how much you will believe or not of Mr. Gustafson's testimony.

Generally the judge seemed to be saying that the jury should be somewhat more skeptical of Carl's unsupported testimony than less involved witnesses.

- She explained that the USB flash drives were copies of paper documents seized from Thunder Bay searches. The scans are not evidence. When in doubt about a particular document refer top the hard copies. You may infer that Mr. Lawson has knowledge of documents seized from his home, Mr. Porisky's home, and Norall's offices in Thunder Bay.

Then on to evidence, direct, hearsay, and circumstantial. Then on to what the judge called General Principles. Such things as presumption of innocence, reasonable doubt, burden of proof. The essential element the Crown must prove is that Mr. Lawson is guilty beyond a reasonable doubt.

Then the killer blow against most of Lawson's defense, mistakes in law. A mistake in understanding the law may mitigate tax evasion. However the belief that the Income Tax Act is invalid or is not applicable to an individual is not a mistake. Paradigm's beliefs are not mitigating mistakes in law.

I got a break as the judge read out the charges. There was a lot of coming and going in the spectator area, as far as I could tell almost all student groups. After charges read time for break.

When we reassembled before the jury returned Lawson, as always, had issues. He was very agitated. He wanted to talk about his perceived problems with the charges right now. Judge - "Sir there is a procedure. I discussed it with you last night and this morning. You must wait until the end." So jury in and judge continued at paragraph 103.

You must ignore Mr. Lawson's theory that since he was a natural person he was not a person under the Act. The Act does not define income so it must be based on the normal usage. Although it isn't defined in the Act it is explained in section 3 how it is to be calculated.

This is section 3 of the Income Tax Act;

DIVISION B
Computation of Income

Basic Rules

3 The income of a taxpayer for a taxation year for the purposes of this Part is the taxpayer’s income for the year determined by the following rules:

(a) determine the total of all amounts each of which is the taxpayer’s income for the year (other than a taxable capital gain from the disposition of a property) from a source inside or outside Canada, including, without restricting the generality of the foregoing, the taxpayer’s income for the year from each office, employment, business and property,

(b) determine the amount, if any, by which

(i) the total of

(A) all of the taxpayer’s taxable capital gains for the year from dispositions of property other than listed personal property, and

(B) the taxpayer’s taxable net gain for the year from dispositions of listed personal property,

exceeds

(ii) the amount, if any, by which the taxpayer’s allowable capital losses for the year from dispositions of property other than listed personal property exceed the taxpayer’s allowable business investment losses for the year,

(c) determine the amount, if any, by which the total determined under paragraph (a) plus the amount determined under paragraph (b) exceeds the total of the deductions permitted by subdivision e in computing the taxpayer’s income for the year (except to the extent that those deductions, if any, have been taken into account in determining the total referred to in paragraph (a), and

(d) determine the amount, if any, by which the amount determined under paragraph (c) exceeds the total of all amounts each of which is the taxpayer’s loss for the year from an office, employment, business or property or the taxpayer’s allowable business investment loss for the year,
and for the purposes of this Part,

(e) where an amount is determined under paragraph (d) for the year in respect of the taxpayer, the taxpayer’s income for the year is the amount so determined, and

(f) in any other case, the taxpayer shall be deemed to have income for the year in an amount equal to zero.


http://laws-lois.justice.gc.ca/eng/acts/I-3.3/

Now Burnaby49 knows why income, the most important word in the Income Tax Act, is not defined. At least this was how it was explained to me in a course I took about forty years ago. At one time income was defined in the Act. In fact this is the definition of income in our very first Income Tax Act, the Income War Tax Act of 1917. Here is the original Section 3 from that Act;

3. (1) For the purposes of this Act, "income" means the annual net profit or gain or gratuity, whether ascertained and capable of computation as being wages, salary, or other fixed amount, or unascertained as being fees or emoluments, or as being profits from a trade or commercial or financial or other business or calling, directly or indirectly received by a person from any office or employment, or from any profession or calling, or from any trade, manufacture or business, as the case may be; and shall include the interest, dividends or profits directly or indirectly received from money at interest upon any security or without security, or from stocks, or from any other investment, and, whether such gains or profits are divided or distributed or not, and also the annual profit or gain from any other source; including the income from but not the value of property acquired by gift, bequest, devise or descent; and including the income from but not the proceeds of life insurance policies paid upon the death of the person insured, or payments made or credited to the insured on life insurance endowment or annuity contracts upon the maturity of the term mentioned in the contract or upon the surrender of the contract; with the following exemptions and deductions:—


So what was wrong with that? As soon as income was defined it became a target. Every tax lawyer and accountant in the country started tearing the definition apart for loopholes where their clients could get "income" in a manner that did not fit within the definition of income in the Act. And they soon found them. So the definition was changed to encompass these. And the lawyers found yet more that were not in the revised definition. And so it went until the government realized it was a fool's game and they were never going to be able to close all the loopholes if they continued to have a definition of income. So they gave up. The result is the current situation where Section 3 doesn't define income but instead tells how income is "determined";

3 The income of a taxpayer for a taxation year for the purposes of this Part is the taxpayer’s income for the year determined by the following rules:

(a) determine the total of all amounts each of which is the taxpayer’s income for the year (other than a taxable capital gain from the disposition of a property) from a source inside or outside Canada, including, without restricting the generality of the foregoing, the taxpayer’s income for the year from each office, employment, business and property,


And employing that great fudge term "without restricting the generality of the foregoing".

Back to the judge.

Mr. Lawson does not agree that the money he made is income. The Crown has to prove beyond a reasonable doubt that Mr. Lawson has income. They have provided Banker's records and financial documents. Mr. Lawson says the amount that he received were private contracts and money he received under these contracts is not income.

You must ignore Mr. Lawson's statements that because of the way he structured his affairs he was not subject to the Excise Tax Act. Whether the Act applies or does not apply is not determined by a unilateral declaration that it does not apply. The Act's applicability is in the Act itself.

Contracts for hire and the belief in what (? No idea what I scrawled here, I think "his status as a person") is irrelevant as a defense on income tax evasion. It does not excuse. Wilful blindness is the same as having actual knowledge. Note - the judge had discussed wilful blindness earlier on.

Mr, Lawson believed that he had structured his affairs so that he had no taxes owing. Mr. Lawson said that he didn't know that he owed taxes or GST because he did not get an assessment notice. There is no requirement that an assessment be served before a criminal investigation commences.

At this point we were at our 12:30 lunch time but the judge kept going. She wanted to read it all out before lunch break.

Basically the judge said that nothing that Lawson professed to believe stood as a defense or mitigating factor for any of the charges. All that was relevant was just did he evade taxes and did he counsel others to evade taxes. His beliefs were unrelated to this. The Paradigm theory encourages and promotes evasion and is not a defense in law.

Mr. Lawson claims that there is a reasonable doubt on his four charges. His actions were not fraud or tax evasion. Then on to the general responsibilities of jurors that I did not even bother to try copying.

Then finished at 1:30. jury gone but we didn't get a break yet. Judge asked parties for list of any issues they had with charges. Asked Crown first if any questions. A few, all minor. A paragraph should have included Carl's home as being searched as well as his offices. Some small point about something else. Then on to Lawson. He had a valid point to start with. In paragraph 181 judge had said "property" rather than "possibly". He was also concerned that the way paragraph 179 is phrased (he didn't read it out) implies that judge is telling jury there is income.

He was also concerned that the copy of Section 3 of the Income Tax Act given to the jury was not complete because it left out section F. This part;

(f) in any other case, the taxpayer shall be deemed to have income for the year in an amount equal to zero.


Apparently that seems to support his position that he has no income even though the judge told him that this just means that there is no net income if losses greater than income. He wanted time to find more complaints after lunch. Judge said no, do it now. So he complained that the Income Tax Act definition of person and individuals not included in the charges.

Judge - "I said in paragraph 105 that you are a taxpayer.
Lawson - "That's not my point"
Judge - "Sir; They are not going to decide if you are a person. You are a taxpayer so whether you are a person or an individual is not important."

Then it was our lunch, back at 2:30. Before jury came in the judge gave the revised charges to the parties and asked if anything else. Crown - no. Lawson, as always, had something but he didn't seem to know what it was or where he'd written it down. He asked for time while he rummaged through a pile of papers in front of him. "I have it here somewhere." Judge was sharp with him. I had told you to be ready when we reconvened." So judge discussed something with Crown while Lawson rootled around i his notes. Then judge told Lawson she was not making changes to reflect his concerns so no definition of person.

He started going on about reasonable expectation of profit and the Stewart case and the judge cut him off. The explanation in the charges is sufficient.

Lawson - Unfair! Prejudiced!
Judge - This issue was discussed Friday and it would have been helpful if you'd brought it up then. I decline to change paragraph 155.

Lawson - I have another problem!
Judge - What paragraph?
Lawson - All of them! Profit is wrong. Then a rant that property and income are not properly defined in the charges.

Judge said that Lawson couldn't discuss concepts now that the charges were given. Lawson said that he was bringing it up now to put it on the record so that he can appeal it. That was fine by the judge but we were not going to address it at this late point.

Jury back at 2:40. Judge told jury about the changes to the charges then jury exused to deliberate at 2:50.

Judge said "To continue our long day we still have to consider the ban". However judge had to go to her chambers to retrieve some materials so we had a 15 minute break.

Back at 3:15 with Lawson and two Crown counsel to consider the ban. A discussion which would have been unnecessary except for me because nobody else, except Millar, seemed to be paying much attention to the trial or writing anything down.

Judge said to restate for the record and context because of an application early on for the ban to be extended to trial from pre-trial hearings. Judge reviewed the Lawson ban and concluded that the ban on the trial proper had no basis in statutory or common law except to limit the extent of reporting on Michael Millar and Debbie Anderson. So judge wanted to hear from parties on the ban's continuation.

The background for those of you who have forgotten the tortured trail of all these bans. Lawson had both statutory and common law (inherent jurisdiction) bans imposed on his entire trial proceedings. They covered different aspects of the trial. The statutory ban ended at 2:50 when the jury was sequestered. The judge had just said she didn't see any basis for the common law ban either except for one thing. The March 22nd and 23rd vior dire hearing in front of Justice Brown in New Westminster. This was a joint hearing with Lawson, Anderson and Millar. Justice Brown had placed a publication ban on that hearing until the last of the three trials was concluded. Lawson was now done and, entirely unknown to us, Millar would be done tomorrow when he elected to have a trial by judge rather than by jury since bans only apply to jury trials. You can read about Millar's hissy-fit and takedown here;

http://www.quatloos.com/Q-Forum/viewtopic.php?f=50&t=10834#p227241

But that still left Debbie, scheduled for trial in November.

So Crown said that the current ban covered all of Lawson's proceedings and Justice Brown's ban covered the voir dire. Since all three defendants were involved in the hearing that ban covered the evidence in the voir dire for all three jury trials. So the voir dire ban stays in place until all three trials done unless directed otherwise by the court. Judge and Crown agreed that the voir dire ban should continue but Crown said that there was no further necessity for a ban on any of Lawson's hearings apart from that so it is the Crown's position that the ban should be lifted. There is a public interest in the case.

Lawson said that at this point he wasn't concerned. Since Judge Brown's ban continues to avoid prejudice to other people still to have their trials I think it fair that the ban be lifted.

So the judge said that the statutory ban is automatically lifted including pre-trial matters. For any individual in court (Hi everybody!) this is a step by step process so the ban is lifted for the criminal code but the ban by Justice Brown remains in place until all three matters have concluded.

There was still another matter to be discussed. Debbie Anderson had testified at this trial and the judge was concerned that the publication of her testimony might cause prejudice to her in respect to her oncoming jury trial. So judge wanted parties to consider whether a ban should still cover Debbie's testimony. Judge asked "Is there any objection to a ban on the evidence regarding Ms. Anderson" Crown said that it was not necessary to ban Ms. Anderson's evidence. Judge asked if Lawson had any comments on Anderson's evidence. I have him down as just saying "I'm unrepresented" which doesn't seem to be to point on anything. Judge said that the overarching concern was the public's access to an open court. Judge went into a long analysis of the administration of justice and the public right to know. She came to the conclusion that the publication of the Anderson testimony is allowable and that any prejudice to Debbie could be rectified through instructions to jury at her trial. There is no evidence there that would be a serious risk to the proper administration of justice by lifting the ban on Anderson.

Judge asked if anyone in courtroom wished clarification so I put my hand up. So I went into the court and said that I had a comment. Judge said that she had no need for comments. I'd obviously worded that wrong since I had no intention of giving any opinion on the bans. I said that I had not been in court for Anderson's testimony and had no knowledge of what she said so I had no intention of publishing anything on it. The judge gave a short explanation to me about the reasons for the ban and I said that I had no issues with it. And Lawson was done.

A note - You've probably noticed how neurotically anal I am about cramming in all the details that I can into my court reporting, be they interesting, pedestrian, or entirely trivial. I think it important to show the reality of what happens inside a real courtroom as opposed to the movie or television courtrooms where it is excitement and drama every minute. I sat through both days of the voir dire and I recorded it in depth. My final write-up is 9,140 words long and once the ban is lifted I'm going to inflict it on all of you all three separate times in the Lawson, Anderson, and Millar discussions. Who knows, it may happen sooner than I currently expect. The only impediment now is Debbie Anderson and, after Lawson's disaster and Millar's change to a jury trial, she is might just be reviewing her options.

I've been grinding away at this for hours to get Lawson written up before the next deluge of Poriskyites hits me. One defendant who I've not yet mentioned on Quatloos is on trial next week and I plan to be there. Millar comes up at the end of the month. Happily Leo Fung, who was originally scheduled for this month too, has been set back to November so he will hopefully get my undivided attention.
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Re: Another Canadian Sovereign (Keith David Lawson)

Postby wserra » Sun May 08, 2016 3:03 pm

Burnaby49 wrote:I think it important to show the reality of what happens inside a real courtroom as opposed to the movie or television courtrooms where it is excitement and drama every minute.


Indeed.

Thank you, Burnaby.
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Re: Another Canadian Sovereign (Keith David Lawson)

Postby Burnaby49 » Mon May 09, 2016 2:55 am

wserra wrote:
Burnaby49 wrote:I think it important to show the reality of what happens inside a real courtroom as opposed to the movie or television courtrooms where it is excitement and drama every minute.


Indeed.

Thank you, Burnaby.


Thanks, as a practicing litigator you'd know all about the routine and boredom of a normal day in court. A career as an income tax auditor was good training too. A working life of financial statements, minutes of director's meetings, Articles of Association and Memorandum, documents and more documents. Makes even the court seem lively.

Lawson isn't done yet, just a break until sentencing and then the appeal he told us he plans to make. I've not attended an appeal yet but at least at that level publication bans aren't an issue.

One thing I'm planning to do is try to get a copy of the judge's charges to the jury. It might not be easy, I'm told I'll need the judge's permission. I'll try the court registry this week to find out the process.

I don't want them for just the issue of the charges relating specifically to Lawson. Things like the instructions about his claimed beliefs on the interpretation on the Income Tax Act and his understanding of law and jurisprudence. These are obviously of great importance. I assume that if Lawson appeals that he will do so on the basis that some of the instructions in of the charges relating specifically to him are prejudicial and unfair.

However, apart from that, I think that the charges stand as a great primer on the overall duties and responsibilities of juries under our system and how the jury system functions in any trial. The charges weren't simply something written up by the judge for this trial. Some parts were tailor-made for it but the majority was what I dismissively called "boilerplate" but what is actually a standard template developed over time by the court as a guide covering every aspect of a juror's duties and how to go about fulfilling those duties.

It covered the responsibilities placed on the jurors and the Crown by the presumption of innocence. It explained in some depth reasonable doubt and the burden of proof. Terms we all think we know but which require more precision when a criminal conviction is at issue. It went into great depth on evidence and how to evaluate it and weight it. How the jurors, as the finders of fact could accept all, some, or none of the oral evidence and how to consider the evidence, written, oral, and observed, as a whole in arriving at their decision. It covered the nitty-gritty of how to work together and to discuss and evaluate what they'd seen and heard in court. Essentially as much a philosophical discussion on the workings of the jury system itself as it was a set of instructions on how to specifically deal with Lawson's charges. It was a distillation of the court's entire experience in dealing with the jury system compiled into a document readily understandable by almost anyone qualified to be on a jury.

And you'd get the opportunity to see how accurate I am in my reporting and whether I showed any bias in what part of the charges I chose to include in my posting and what parts I excluded. So I'll see if I can convince the court to give me a copy.
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Re: Another Canadian Sovereign (Keith David Lawson)

Postby notorial dissent » Mon May 09, 2016 6:28 am

Lawson will probably lose the appeal in the clutter on his desk, never mind what will happen if he actually gets one filed. I assume he'll have to pay for a transcript, and I'm betting he'll really balk at that. The man is certifiably bonkers, but snae within the meaning of the law.
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Re: Keith David Lawson - Poriskyite Tax Evader

Postby Burnaby49 » Mon May 09, 2016 7:13 pm

Just a note on the title of this discussion. Since Lawson has now been convicted I changed it from "Another Canadian Sovereign (Keith David Lawson)" to a more accurate title. However this only changes the header on the first post, the remaining posts retain an older title. I could change this but I'd have to do it individually for all 68 unchanged posts and I can't be bothered.
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Re: Keith David Lawson - Poriskyite Tax Evader

Postby Burnaby49 » Wed May 11, 2016 1:18 am

One of Lawson's failed defenses was his claimed belief in the almost mystical power of the Stewart case to allow him to declare hundreds of thousands of dollars of income from his Paradigm business as nothing more that the tax-free incidental returns from a hobby. If anyone (unlikely but possible) is interested in the actual importance of Stewart and it's application to Canadian tax litigation take a look at this very recent case;

Anderson v. The Queen, 2016 TCC 106
http://canlii.ca/t/gr75d

Absolutely nothing unusual in the facts or analysis, the Tax Court reviews cases like this frequently. The significance of Stewart is that it sets a framework for the analysis of whether or not expenses are deductible as business expenses. I've not yet seen any case where a taxpayer attempted to use Stewart in the manner that Lawson tried to utilize it; to try and prove that a profitable, money-making endeavour was not a business based on an interpretation of the law supported by Stewart. Not that it matters. If the Crown proved that Lawson made a profit on his Paradigm business/hobby it was irrelevant how it was labeled. So even if it was a hobby the profits were taxable and he'd evaded taxes by not reporting it. His analysis of the Stewart case had no more legal weight than his analysis of the legal meaning of 'person' under the Income Tax Act.

I checked the Criminal trial registry of the Supreme Court of British Columbia today about getting a copy of the charges. Until Lawson is sentenced the court file is not available to the public. That will be at least a month or two.
"Yes Burnaby49, I do in fact believe all process servers are peace officers. I've good reason to believe so." Robert Menard in his May 28, 2015 video "Process Servers".

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Re: Keith David Lawson - Poriskyite Tax Evader

Postby Burnaby49 » Fri Jul 22, 2016 8:12 am

July 20, 2016

Today was the start of three scheduled days of a voir dire instigated by Lawson. This is how Wikipedia explains a voir dire;

In the United Kingdom (except Scotland), Cyprus, Hong Kong, Ireland, Australia, New Zealand, and Canada (and sometimes in the United States of America) it refers to a "trial within a trial". It is a hearing to determine the admissibility of evidence, or the competency of a witness or juror.[2] As the subject matter of the voir dire often relates to evidence, competence or other matters that may lead to bias on behalf of the jury, the jury may be removed from the court for the voir dire.
The term has thus been broadened in Australian jurisdictions to include any hearing during a trial where the jury is removed. The High Court of Australia has noted that the voir dire is an appropriate forum for the trial judge to reprimand counsel or for counsel to make submissions as to the running of the court to the trial judge.[3]

In Canada the case of Erven v. The Queen holds that testimony on a voir dire cannot influence the trial itself. This remains true even if the judge ruled against the accused in the voir dire. The judge is assumed to ignore what they heard during voir dire.[5] The jury is never present during a voir dire.


https://en.wikipedia.org/wiki/Voir_dire

Lawson was complaining about abuse of process and he wanted a stay of proceedings and damages against the Crown as a result of the mistreatment he'd received at the hands of CRA Investigations. Unfortunately for Keith there is no automatic right to a voir dire, the Crown may make what is called a Vukelich Application, named after this case;

R. v. Vukelich, 1996 CanLII 1005
http://canlii.ca/t/1f0d7

Which set the standard, at least in British Columbia, that a voir dire applicant has to meet before getting court approval. So the Crown was contesting Lawson's application on the grounds, I assume, that there was no merit in his application. They had made a written submission to the court and today was Lawson's opportunity to defend his position. Not to actually go into the voir dire itself but to only show that he had grounds to get his application accepted by the judge.

A warning. He spent the whole day talking. Endlessly, incessantly, obsessively. And, most significantly, repetitively. The same arguments over and over again ad infinitum. So I'll boil it down here to the salient points that I think he was making. His complaint was in respect to the preliminary inquiry that was held when the CRA entered charges against him. This is how a Preliminary Inquiry is defined in Canada;

Where the accused is charged with an indictable offence, the Crown must prove a prima facie case before a judge of a provincial court. This process must be requested by the defence or the Crown.[9] The presiding judge must determine whether there is sufficient evidence for a jury, acting reasonably and judicially, to convict the accused. The judge may neither weigh the evidence nor determine whether the evidence is admissible. If the judge determines there is sufficient evidence for a jury acting reasonably and judicially to convict the accused, the judge must commit the accused to stand trial. If not, the judge must discharge the accused and the proceedings end. However, if at a later date the Crown tenders further evidence, the Crown may recommence the proceedings. A discharge at a preliminary inquiry does not constitute double jeopardy.

There is no appeal from an order of a judge. However, either party may seek leave to review the order in the superior court.

If the accused is charged with an offence punishable by summary conviction or if the Crown elects to proceed by summary conviction if the accused is charged with a hybrid offence, the accused is not entitled to a preliminary inquiry and is immediately committed to trial.

Section 536(4) of the Criminal Code, proclaimed in force in 2004, indicates a preliminary inquiry is no longer automatic after an accused elects to be tried in a superior court. The Attorney General may also, in rare cases, bypass the preliminary inquiry and issue a direct indictment. This may occur even where the accused has requested a preliminary inquiry, or even when the accused has been discharged by a preliminary inquiry.[10]


https://en.wikipedia.org/wiki/Criminal_law_of_Canada#Preliminary_inquiry

The barrier at a Preliminary Inquiry is low. It is not to determine guilty or innocence or even weigh the evidence, those are trial responsibilities. A preliminary inquiry just decided if there is enough evidence to support a possible guilty conviction. If so a trial is ordered.

Lawson had his Preliminary Inquiry and the judge determined there was adequate information to justify a trial. His position in this application is that the Crown was guilty of abuse of process in the manner in which they gathered and presented the evidence at the inquiry. His specific complaint seemed to be in respect to the CRA investigator who was in control of his file and who gathered the evidence and testified at the inquiry. The examples of abuse of process that he cited were;

1 - The investigator wasn't trained properly.

2 - The investigator didn't know what income was and had no understanding of tax law.

3 - The investigator, and others in the investigation, did not take adequate notes of their internal processes, meetings, and decisions.

4 - If they did take notes they have hidden them from the Crown counsel and the court.

5 - He sent the investigator a letter saying he was innocent of tax evasion and explained why but they did not stop the investigation.

6 - They investigated on the basis of the presumption of his guilt but did not investigate him on the presumption that he was innocent,

7 - The Supreme Court of Canada had stated in a landmark decision that Canadian taxpayers have the option of categorizing their income as being derived from either a business or a hobby. If they declare their income to be derived from a hobby they cannot be reassessed or audited by the CRA. He told Investigations that his Paradigm work was a hobby and therefore not taxable but they ignored this and charged him anyhow. He was obsessed with this point because he had the Supreme Court case which clearly backed him up.

8 - Both he and his wife were charged with tax evasion. The Crown dropped his wife's charges but didn't drop his. I think this was a point he made, he mentioned his wife's issues in fragments rather than a coherent argument and I wasn't paying a lot of attentions.

Each of these items, individually, was a breach of natural justice and an abuse of process that required that there be a stay on proceedings and damages paid to him. Although he did tell the court that he'd be willing to accept any other recompense the court decided to bestow on him.

Please note that I am stating just what I understood Lawson to argue, if it doesn't make sense to you don't blame me.

So on to my very long day. Started with the judge saying that Lawson had applied for remedy under 24(1) of the Charter. Vukelich applications usually applied to 24(2) of the Charter but the Crown had said that it applied to 24(1) also.

This is 24(1) and (2);

24. (1) Anyone whose rights or freedoms, as guaranteed by this Charter, have been infringed or denied may apply to a court of competent jurisdiction to obtain such remedy as the court considers appropriate and just in the circumstances.

(2) Where, in proceedings under subsection (1), a court concludes that evidence was obtained in a manner that infringed or denied any rights or freedoms guaranteed by this Charter, the evidence shall be excluded if it is established that, having regard to all the circumstances, the admission of it in the proceedings would bring the administration of justice into disrepute.


Pretty damn vague to me. We heard a lot about bringing the administration of justice into disrepute during the course of the day. Anyhow the judge explained to Lawson that it was his job to convince her that he had a valid reason to hold a voir dire on abuse of process and the Crown was going to argue that his application did not provide any reasonable basis for an application for abuse of process. He went to bat first.

I have to be able to show some merit for relief under the Charter. Judge cut in to say that Vukelich applications usually applied to 24(2) of the Charter but had said that it applied to 24(1) also. Lawson said that he had been unable to find any legal representation and went on how the court should help him. There was a shortage of caselaw on the issues he was going to raise but his points were hinted at in some cases. This case is unique. He talked about the nature of the "alledged" offenses. Since he had been convicted on all counts I don't think that alledged was the appropriate word. Judge said that he didn't understand what he was getting at. Nor did I. So she explained Vukelich yet again although it had apparently been explained to him in a pre-trial conference.

He went on about police abuse and said that this was the basis of his claim although he was making no claim that he was abused by police. During the Preliminary inquiry a CRA witness, the lead investigator in his case (I'll call her LI from now on) said that she did not understand the nature of the offenses that he was charged with so the investigation was flawed. She did not understand what income was or how to determine it. He'd objected to her testimony but was overruled and a judicial review found no error. His wife's charges were withdrawn for something relating to this. He implied that the Crown knew, when they charged her, that she had no knowledge of the charges against her. He seemed to hint that since his wife had been let off he should have been let off too. He was railroaded by improperly trained CRA employees. He brought up his attendance at Russell Porisky's trial (apparently on a day when I wasn't there) and said that the Crown had made some admission that somehow affected him. If this sounds impossibly vague that was how I heard it. LI was supposed to testify at his trial but didn't. Hinted at dark designs behind this. He'd planned to cross-examine her to show that she didn't know what income or tax evasion was to show the jury that she was incompetent. Judge interrupted to tell him that such evidence would not have been permitted at trial. LI had not testified because they had lost days of court time as a result of his illness. The judge said that evidence wasn't relevant. He went on about how his presumption of innocence had been violated by LI at his Preliminary Inquiry. Judge said that the presumption of innocence only applied after he was charged and he hadn't been charged at that time.

So on to his caselaw. Some case he said supported his application. But first he said that he wanted an award of damages in addition to a stay of proceedings. He also asked the court to tell him of other relief he was entitled too. He said that it was the court's job to provide a remedy for him if he'd missed anything.

He cited a case I didn't catch. Something about a rented locker with marijuana in it. Something about an absence, on the part of the police, of a sincere attempt to follow the Charter. Lax police procedures can't be condoned. He compared this to LI at the Preliminary Inquiry without actually explaining how they were analogous. He just said that LI hadn't given his Charter rights any thought.

Judge - What Charter rights? The cited case was about unreasonable search. What Charter rights wasn't LI mindful of? She wasn't mindful of due process. Judge - Where is that in the Charter? He said it wasn't a specific charter right but implied. Judge said that he'd eventually have to cite specific charter rights that he claimed were violated. He didn't seem to understand that Charter rights were specific, not just some undefined right that was triggered if he felt he wasn't fairly treated.

He said that R v Nixon mentioned a "residual" category his claim fell under. He talked about how the judge had the "residual" right to halt a trial for abuse of process. He started losing me when he tried to explain how this judicial residual right also meant that he had a residual charter right of some kind. Keep in mind that he talked fast, without any halts and he was very vague on details. I don't think he had any. It appeared to me that he'd just pulled a pile of cases out of CANLII or some other database using a word search. He hadn't bothered to analyze the cases as a whole but had just plucked sentences and paragraphs out of them he felt bolstered his position without reference to how they fit into the case cited.

Lawson went on about abuse of process but hadn't, as yet, given any specifics about any abuse he'd suffered. He said the court is condoning investigations that are not well-founded and not following proper procedures. Judge said that not following internal procedures are not an abuse of process so Lawson went back to how LI and how her purported errors were not innocent mistakes. Dark hints of conspiracy.

Judge - The prosecutorial process did not meet fundamental notions of justice under section 7 of the Charter. Is that what you are arguing? This is section 7;

7. Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice.


It's not a good thing when even the judge is confused about what you are fundamentally arguing. I essentially no longer had a clue where Lawson was going. Lawson replied yes but I don't know what I want or what I'm entitled too.

All this took less than the first hour and Lawson, as I saw it, had presented absolutely nothing except a wish that the judge would find some charter breach for him because he couldn't cite any. On to more irrelevant cases. Then he talked about damages for his unjust conviction and incarceration. Incarceration? He hasn't even been sentenced yet. On again about how the CRA investigators had some undefined duty to him. He wanted their notes to show abuse of process. Since they did not provide notes the CRA was in trouble because of their failure to document the process. That was also apparently a Charter violation.

A note at this point. What he meant, as I understood it, was that the CRA had a duty to him to take notes of anything that happened internally at the CRA in respect to his prosecution. Every meeting, every phone call, every discussion or decision. He claimed some unsubstantiated obligation that the CRA had to do this and they had failed That meant his charges should be stayed. However it has already been determined in court that the CRA has no such obligation. They have an obligation to preserve noted if they make them but no obligation whatever to make any in the first place. The only relevant issue at his Preliminary Investigation was whether there was enough evidence to proceed to trial. It was not the mandate of the presiding judge to dredge through the CRA's decision process that lead to the Preliminary Inquiry.

Lawson asked for an early morning break because he planned to go into his next submission and he expected it would take some time. At this point, after less than an hour, I had four pages of notes in an 8X11 lined notebook. I'd have many more by day's end. As far as I could tell Lawson had not yet said anything to point.

He started after break by going on again about how he is entitled to undefined residual Charter rights. Judge told him no, there are no secret undefined rights. "What you have said does not support any Charter right breach so far." "I have interrupted to ensure that we stay on track." The judge said that there was a duty of the court to unrepresented parties but, "it is not sufficient to put facts and law before the court and tell the court where to find where your Charter breaches are. You need to formulate what the breach was and specify what Charter right was violated."

If he understood what the judge was saying he didn't act on it. He cited the McCartie case which we have already discussed on Quatloos.

R. v. McCartie and McCartie, 2015 BCPC 69
http://canlii.ca/t/gh1k2

http://www.quatloos.com/Q-Forum/viewtopic.php?f=50&t=9390

Lawson's concern was about note-taking by the CRA while they were investigating him. As far as I could tell he meant internal notes and records of all meetings, discussions, decisions etc made by any CRA employee engaged in investigating his tax affairs. He was complaining that the CRA did not take sufficient notes for him to follow the internal process that led to his Preliminary Inquiry. Lawson said that the McCartie decision cited above resulted in some relief to the McCarties based on the lack of notes and records. The case showed that the CRA had a duty to keep notes. Which was entirely wrong. What the McCartie decision said was that the CRA had no duty to take notes but if they did take them they had a duty to safeguard them and produce them on request. The judge imposed sanctions against the CRA, not because they didn't keep records, but because they lost the ones they made. In this case Crown has said that all notes made in the Lawson investigation were provided to him so the McCartie decision in no way supported Lawson's contention about a requirement to note every little thing that happened in an investigation. I said in Quatloos;

There are two parts to the issue of the lost notes, the notes themselves and the claim, by the McCarties, that their charter rights were violated by notes that were not lost because they had never been taken in the first place. The McCarties claimed that the CRA staff had a duty to note everything that they did on the file and record all conversations held between each other so that the McCarties could review all the reasons for the various decisions made by the CRA.

OMISSION TO MAKE NOTES

[49] Mr. & Ms. McCartie say that the omission by Mr. Brown, Mr. Lidster, Ms. Etches and Mr. Chan to make notes of their communications is a breach of Mr. & Ms. McCartie’s rights under sections 7 and 11 of the Charter. During argument, the parties characterized this issue as raising the question whether those individuals had a duty to make notes in the circumstances pertaining. Mr. & Ms. McCartie also complained of the failure of Mr. McLachlan to make notes. However, I consider that to be of no significance because the question is CRA’s motive or intention in December, 2008, when notices were delivered to compel disclosure of the bank documents, and Mr. McLachlan had no role in the case until the spring of 2009.

[50] Mr. & Ms. McCartie say that the duty to make notes arises from two sources:

a. They say that there is a legal duty, of general application, on police officers to make notes, and the same duty should apply to CRA investigators.

b. They refer to many entries in CRA policy manuals and training materials, which instruct CRA investigators to make and retain detailed notes.

[51] In support of the first proposition, they rely on Wood vs Schaeffer 2013 SCC 71 (CanLII), [2013] 3 SCR 1053. However, I note that Wood vs Schaeffer was concerned with the application of a particular Ontario regulation, having the force of statute, which expressly imposed specific obligations on Ontario police officers to make notes in specific circumstances. I was referred to no statute which imposes a similar obligation on CRA staff. In the absence of such a statute, I think that the legal position was correctly stated in Regina vs Davidoff 2013 ABQB 244 (CanLII); i.e. note-taking is a prudent and responsible police practice, but not a legal obligation.

[52] I do consider CRA’s policies and training manuals to be of significance. I discuss that issue in paragraphs 60 - 61, below. However, they do not create legal duties: Hewko vs British Columbia 2006 BCSC 1638 (CanLII); [2006] BCJ #2877 @ paragraphs 313 – 318.

[53] I conclude that the CRA staff were under no legal obligation to make notes.


So while it might be regrettable that the CRA didn't slavishly recorded every "good morning Harry" and "see you tomorrow George" while they worked on the file they had no duty, legally or constitutionally, to do so. However the McCarties had a win in respect to the notes actually made then claimed lost. Apparently, while the CRA had no duty to actually make notes, if notes were actually made they had a duty to retain them;

[66] The only alternative remedy suggested by Mr. McFadgen is the possibility that, when assessing the credibility of Mr. Brown, Ms. Etches and Mr. Chan, I should take into account the loss of Ms. Coles’ notes and the omission of the others to make notes. In my view, that remedy would be inadequate to address the prejudice to Mr. & Ms. McCartie. They carry the onus of proving CRA’s motive and intentions. That onus can be discharged only by affirmative evidence. An adverse inference may assist in corroborating or reinforcing affirmative evidence, but is not a substitute for affirmative evidence. For that reason, it has been held that “…an adverse inference will not be drawn where the effect of drawing such an inference is to reverse the onus of proof …”: McIlvenna vs Viebeg 2012 BCSC 218 (CanLII); [2012] BCJ #292 @ paragraph 70. At present, the only affirmative evidence of CRA’s motive and intentions consists of: (i) Mr. Brown’s notes, quoted in paragraphs 6, 10, above; and (ii) the notable circumstance that Mr. Brown proposed the second audit of Mr. & Ms. McCartie’s returns, in the course of which the bank documents were procured, within a month or so of his return to the Audit Department from the Investigations Department. Coupled with an adverse inference, that evidence might support a conclusion that the hypothesis advanced by Mr. & Ms. McCartie is correct, but it is not a strong case for the defence. By comparison, if Ms. Etches and Mr. Chan had kept notes, and if they had expressed themselves in a manner similar to Mr. Brown, the notes might have presented a compelling case for the McCartie hypothesis.

[67] However, I do not think that a judicial stay of the prosecution is necessary. The prejudice to Mr. & Ms. McCartie can be remedied by excluding from evidence all documents procured by CRA by the exercise of its statutory powers during the second audit. If the Crown can prove its case without those documents, it should do so.


http://www.quatloos.com/Q-Forum/viewtopic.php?f=50&t=9390#p172549

Our judge picked up on this too and said that the omission to make notes wasn't culpable. "They were under no obligation to make them. This case (McCartie) does not establish your argument that there was a duty to make notes. Your point is that their omission to take notes hindered their rights to a fair trial". Lawson - They are not free to do what they want. There has to be some standard. He's apparently invented a standard of conduct for the CRA in respect to note-taking even though, as McCartie showed, there is no legal obligation to take them.

He brought up another case that seemed totally irrelevant. It somehow, in his mind, bolstered his argument that CRA auditors have to follow all of the Agency's internal manuals exactly and fully or his rights are violated. Apparently he thinks they didn't in his case although he hasn't provided any evidence to prove this requirement exists or that the CRA investigators on his case didn't follow the manuals, whatever they might be. As with McCartie the cited decision went against the argument he was making but he said that it somehow supported him on principle. Then he rambled through a number of decisions giving no details at all. What little he pointed out had nothing to do with whatever arguments he was making.

Back to notes. Why were no notes taken? There should have been in principle of fairness! Judge - Are you quoting? Lawson - No, discussing my case. We were all getting confused by his intermingling of personal comments with case quotes. He said courts should be flexible to cover different possibilities. He couldn't find a case to support him to point on the notes but he said that there were enough principles in the cases to show that he was a victim of abuse of process.

Apparently the abuse was in charging him in the first place. He said that the Crown (Crown lawyers) abused the process by joining in the cover-up of the flimsy investigation that led to his charges. Apparently Investigations cooked the whole thing up to railroad him and somehow succeeded. He kept going on about implied duties that the CRA and Crown had. Dark hints about a conspiracy against him and how he needed to do a root and branch investigation of Investigations to uncover it.

Then a case about somebody burning leaves in their yard. Where does he get them? His point seemed to be that inadequate training of the police in this case was abuse of process so inadequate training of CRA staff was abuse too. Note that he hasn't demonstrated that any inadequate training of CRA staff existed, just bald statements about it. He seemed to be implying that had Investigations done a proper trained job they would have seen that he was acting within the law and not charged him. In any case the decision in the leaf-burning case was against the point he was making because police training was irrelevant to the decision.

Then some cases that even he said he couldn't explain how they supported his argument. But they might, he didn't know.

Apparently Investigations only investigated whether he was potentially guilty. They did not investigate whether he was possibly innocent. He went on and on how the investigators did not know the law (tax law) so they shouldn't have charged him. He did not say why they did not know the law, I assume because they did not agree with his legal analysis that he owed no tax.

All of his arguments relate to the Preliminary Inquiry. He and his wife had sent notes to Investigations when they knew that they were being investigated explaining why they had not done anything criminal but Investigations ignored them and laid charges. Apparently that was a Charter breach.

The judge cut into his ramblings. "You can't go on a fishing expedition on bald statements. If this is a fishing expedition to find out there is undisclosed evidence this is not permitted. A fishing expedition to find if there is undisclosed evidence is not a basis for a voir dire. "

He agreed but said that the fact that there were no Investigation notes, even if there was no duty to make them, showed that there was a conspiracy. Why were there no notes in a case this complex?

He went on about Porisky, Debbie Anderson, Operation Fable, he was making no comments to point now. He just went on in an unstoppable but measured flood, more stream of consciousness than a thought out presentation. Repetitions, diversions, more repetition. Then he said "I think I'm off the track. Where was I going?" Who knows? I assume that Crown and the judge were as lost as I was regarding what he was getting at regarding his claimed Charter breaches. He asked for a break before he finished his cases so lunch called and back at 2:00. Note that, at this point, I'm at page 9 of the Word document I'm writing this on and he's been talking less than two hours.

After lunch immediate rambling that left me behind quickly. I was losing focus. He provided an eight page Application for constitutional remedy. He focused on the failure of Investigations to have a reasonable basis to believe that he was guilty. This breached fundamental justice. If this seems familiar get used to it. Apart from his hobby claims to come the afternoon was really a repeat of the morning. Investigations did not consider a presumption of innocence. Apparently his presumption of innocence was violated by Investigations laying charges against him. Judge said that they laying of charges does not undermine the presumption of innocence. Back to the lack of understanding of law from the investigators. Then, like picking at a scab, back to LI and her lack of knowledge of tax law. Auditors have to have had at least a basic understanding of the income Tax Act if they investigated him. The community expects this and would be very concerned to find out that Investigations does not know the law. I'll make a wild guess here. He is claiming that the Investigations staff were clueless about tax law because they did not agree with the letter he sent them telling them why they were wrong in their interpretaion of law and because they didn't agree that he wasn't taxable on his Paradigm income.

He gave a handy checklist of questions he'd asked LI on the stand at his Preliminary Inquiry;

1 - How do you determine if money is taxable? You receive the profit.

2 - Investigators did not realize that his Paradigm activities were a hobby and therefore not taxable. There are categories of money received which are not taxable. He cited the Stewart case. Note - I'll get into Stewart in a minute.

3 - GST and Excise Tax Act. He'd asked LI about the basis of GST requirements. She didn't seem familiar with them. Then on about natural persons and how Investigations wouldn't recognize him as a natural person.

A long pointless argument how Investigations registered him for GST purposes without telling him. He went on and on about this until I was in a stupor. He seemed indignant that even though he'd actually gone to the CRA and told them he wasn't taxable they continued anyhow. All that money he made was just a hobby. He made 0ver $200,000 of unreported taxable (not gross) income in five years, this was his only income in that period. Why was it a hobby? Because he said so. Why aren't hobbies taxable? Because he said so. What did he have to back this up? A Supreme Court of Canada case that he claimed said that taxpayers were allowed the option of choosing to call their income as being earned from either a hobby or a business. If they chose to call it a hobby the income from it magically became tax-free. Businesses were taxable. So, like a law-abiding taxpayer, he chose the hobby option as authorized by the Supreme court of Canada.

We're now about to get into and almost endless repetition of Lawson's complaint regarding how he was abused and his rights denied by the CRA because they didn't allow him the entirely legal option to declare that his Paradigm income was all derived from a tax-free hobby. The case he was citing was Stewart v, Canada. So time for a digression to actually analyze Stewart and its predecessor Moldowan v. The Queen to see if they support his claim. Here are the cases.

Moldowan v. The Queen, [1978] 1 SCR 480, 1977 CanLII 5 (SCC)
http://canlii.ca/t/1mk9m

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

The issue in both Muldowan and Stewart was not whether certain income was taxable but whether taxpayers could claim what were personal expenses or expenses from hopeless business ventures against other income. As an example here is a very recent case where a taxpayer was claiming the costs of his food, clothes, and trips to Florida and Hawaii against his employment income at Bell Canada. I see dozens like this every year.

Pakzad v. The Queen, 2016 TCC 144
http://canlii.ca/t/gsczs

Note paragraphs 35 of that decision;

[35] The test for determining whether a taxpayer’s activities constitute a source of business or property income was set out by the Supreme Court of Canada in Stewart v. Canada, [2002] 2. S.C.R. 645; [2002] S.C.J. No (QL). 46. In Stewart, the Court held that the “reasonable expectation of profit” test (“REOP”) for determining if a taxpayer had a source of income from a business could no longer be maintained as a stand-alone independent source test. The REOP test should not be blindly accepted as the correct approach to the “source of income” determination. The Court established a new test. Justices Iacobucci and Bastarache set out the broad principle in paragraph 5:

[
5] It is undisputed that the concept of a “source of income” is fundamental to the Canadian tax system; however, any test which assesses the existence of a source must be firmly based on the words and scheme of the Act. As such, in order to determine whether a particular activity constitutes a source of income, the taxpayer must show that he or she intends to carry on that activity in pursuit of profit and support that intention with evidence. The purpose of this test is to distinguish between commercial and personal activities, and where there is no personal or hobby element to a venture undertaken with a view to profit, the activity is commercial, and the taxpayer’s pursuit of profit is established. However, where there is a suspicion that the taxpayer’s activity is a hobby or personal endeavor rather than a business, the taxpayer’s so-called reasonable expectation of profit is a factor, among others, which can be examined to ascertain whether the taxpayer has a commercial intent.


We'll get into Stewart in a moment.

Moldowan, a Supreme Court of Canada case, set the standard of review on the issue back in 1978. The court set the notorious REOP (Reasonable Expectation of Profit) test. If a venture had a reasonable expectation of profit, even if it was losing money, the expenses were deductible against other income. If there was no reasonable expectation of profit they weren't. As you can tell this is a very subjective test. How do you determine a reasonable expectation of profit and who determines it? The CRA of course! The CRA used this as carte blanche to disallow any expenses from any venture losing money that an auditor thought had no chance of profit. This standard held for over twenty years until the Supreme court decided to revisit the issue in 2002 with their Stewart decision. This is the Supreme Court's summary of Stewart;

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 analyzing 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.


Mr. Steward ran a perennially money losing operation owning and renting apartments. He knew it would lose money from the start because of the mortgage expenses but considered it would be eventually profitable. He deducted the excess expenses against his other income and the CRA disallowed them on the basis that his venture did not have a reasonable expectation of profit.

This eventually wound its way up to the Supreme Court which decided it was time to revisit Moldowan. The Supreme Court decided that REOP had to go;

47 To summarize, in recent years the Moldova REOP test has become a broad-based tool used by both the Minister and courts in any manner of situation where the view is taken that the taxpayer does not have a reasonable expectation of profiting from the activity in question. From this it is inferred that the taxpayer has no source of income, and thus no basis from which to deduct losses and expenses relating to the activity. The REOP test has been applied 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: see Ludco, supra; Royal Bank of Canada v. Sparrow Electric Corp., 1997 CanLII 377 (SCC), [1997] 1 S.C.R. 411; Canderel, supra; Shell Canada Ltd. v. Canada, 1999 CanLII 647 (SCC), [1999] 3 S.C.R. 622. As well, the REOP test is problematic owing to its vagueness and uncertainty of application; this results in unfair and arbitrary treatment of taxpayers. As a result, “reasonable expectation of profit” should not be accepted as the test to determine whether a taxpayer’s activities constitute a source of income.


But the court needed something to put in its place. Which brings Lawson's comments about hobbies into play. But note paragraphs 52 and 53. He kept away from them but the judge didn't.

49 The Act divides a taxpayer’s income into various sources. Under the basic rules for computing income in s. 3, the Act states:

3. The income of a taxpayer for a taxation year for the purposes of this Part is his income for the year determined by the following rules:

(a) determine the aggregate of amounts each of which is the taxpayer’s income for the year ... from a source inside or outside Canada, including, without restricting the generality of the foregoing, his income for the year from each office, employment, business and property; [Emphasis added.]

With respect to business and property sources, the basic computation rule is found in s. 9:
9. (1) Subject to this Part, a taxpayer’s income for a taxation year from a business or property is his profit therefrom 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 his 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 mutatis mutandis.

50 It is clear that in order to apply s. 9, the taxpayer must first determine whether he or she has a source of either business or property income. As has been pointed out, a commercial activity which falls short of being a business, may nevertheless be a source of property income. As well, it is clear that some taxpayer endeavours are neither businesses, nor sources of property income, but are mere personal activities. As such, the following two-stage approach with respect to the source question can be employed:

(i) Is the activity of the taxpayer 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 assesses the general question of whether or not a source of income exists; the second stage categorizes the source as either business or property.

51 Equating “source of income” with an activity undertaken “in pursuit of profit” accords with the traditional common law definition of “business”, i.e., “anything which occupies the time and attention and labour of a man for the purpose of profit”: Smith, supra, at p. 258; Terminal Dock, supra. As well, business income is generally distinguished from property income on the basis that a business requires an additional level of taxpayer activity: see Krishna, supra, at p. 240. As such, it is logical to conclude that an activity undertaken in pursuit of profit, regardless of the level of taxpayer activity, will be either a business or property source of income.

52 The purpose of this first stage of the test is simply to distinguish between commercial and personal activities, and, as discussed above, it has been pointed out that this may well have been the original intention of Dickson J.’s reference to “reasonable expectation of profit” in Moldowan. Viewed in this light, the criteria listed by Dickson J. are an attempt to provide an objective list of factors for determining whether the activity in question is of a commercial or personal nature. These factors are what Bowman J.T.C.C. has referred to as “indicia of commerciality” or “badges of trade”: Nichol, supra, at p. 1218. Thus, where the nature of a taxpayer’s venture contains elements which suggest that it could be considered a hobby or other personal pursuit, but the venture is undertaken in a sufficiently commercial manner, the venture will be considered a source of income for the purposes of the Act.

53 We emphasize that this “pursuit of profit” source test will only require analysis in situations where there is some personal or hobby element to the activity in question. With respect, in our view, courts have erred in the past in applying the REOP test to activities such as law practices and restaurants where there exists no such personal element: see, for example, Landry, supra; Sirois, supra; Engler v. The Queen, 94 D.T.C. 6280 (F.C.T.D.). Where the nature of an activity is clearly commercial, there is no need to analyze the taxpayer’s business decisions. Such endeavours necessarily involve the pursuit of profit. As such, a source of income by definition exists, and there is no need to take the inquiry any further.


Lawson also forgot to cite paragraph 60;

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.’”


Lawson, as is his habit, grabbed on to a few convenient quotes from Stewart while ignoring the case as a whole. Read it for yourselves and see if it supports Lawson's interpretation. Feel free to show me the part where it says you can say that your income source is a hobby and, if you do, the income becomes totally tax free. The purpose of the case wasn't to determine if income from a hobby was taxable but to determine if expenses from what might be a personal activity were deductible. The conclusion was that if an endeavor was run in a business-like manner with no personal component then, even if it lost money the expenses were deductible. It was not up to the courts to second-guess whether an activity was a business by using REOP.

So if you have a hobby, like a travel lust that you partly finance by claiming the expenses as a business expense, tough. It has none of the hallmarks of a business and your costs are not deductible. If you are a Paradigm promoter and you give courses for a fee, give private instruction for a fee, and sell educational material for a fee and profit from it this fits into the business-like activity of paragraph 60. Call it a hobby if you want but the Crown and the court will characterize it otherwise. Lawson evaded tax on $213,213 of taxable income during a five year period. His claim that this was from a hobby is, quite frankly, preposterous, particularly since this was his sole source of income in these years.

Back to our courtroom.

After Lawson gave his discourse on how Stewart allowed him to live tax free the judge stopped him. She said that her interpretation of Stewart differed from his regarding paragraphs 52 and 53. "Your interpretation of Stewart is not in accordance with those passages. The fact that you disagreed with the investigator doesn't mean that she was wrong." He started arguing with the judge about the meaning of Stewart. Apparently the judge doesn't understand law either. No doubt we'll see that in his inevitable appeal.

Judge said that paragraph 61 of Stewart said that there was no need to seek further, Stewart supports the Crown's position. The case isn't magic. The issue is the knowledge of law not the knowledge of a case.

Lawson - These people weren't trained! It wasn't a good investigation. They didn't have a sufficient basis to bring charges. Then he asked the judge what she wanted him to talk about. He gave her a menu of topics. She told him that it was up to him. So back to his favorites. Stewart and how all of his Paradigm activities were a tax-free hobby. How poorly the auditors were trained. He was caught in a loop and seemed incapable of getting out. So we went around the block again on topics he'd already beaten to death. He wrote them a letter telling them that it was a hobby but they ignored it! LI did not investigate his potential innocence! Then the point he couldn't leave. He said that the taxpayer was the only one qualified to determine if he was engaged in a hobby or a business and the taxpayer had the option to chose which.

He cited paragraph 54 of Stewart;

54 It should also be noted that the source of income assessment is not a purely subjective inquiry. Although in order for an activity to be classified as commercial in nature, the taxpayer must have the subjective intention to profit, in addition, as stated in Moldowan, this determination should be made by looking at a variety of objective factors. Thus, in expanded form, the first stage of the above test can be restated as follows: “Does the taxpayer intend to carry on an activity for profit and is there evidence to support that intention?” This requires the taxpayer to establish that his or her predominant intention is to make a profit from the activity and that the activity has been carried out in accordance with objective standards of businesslike behaviour.


He had no intention of making a profit! He just enjoyed doing it. Stewart supported him by saying that he could call it a hobby.

Judge - It is important that you understand that paragraphs 52 and 53 are at odds with your interpretation. And paragraph 61 is too. So I will leave you with the thought that there is more to Stewart than your view of it.

He argued that there were some activities that were affected by these paragraphs but not his hobby. He'd told audit this and they didn't care. Time for break.

After break he said that he wanted to try and wrap up. He entered an exhibit into evidence. An affidavit he's made on October 24, 2011 and given to Investigations before they brought the charges. He had a similar letter from his wife. Lawson and I have different ideas about relevance. I can't see entering self-serving statements into evidence is going to help him but it's his case. Then back to argument that the CRA staff wasn't trained enough to charge him. Then back, yet again, to his hobby. Everything he did to make money was a hobby. Investigations said that he was running a business when he told them he was running a hobby. Investigations was neglectful on issue of note-taking. LI wasn't trained and she failed to take due care and attention in her work. He wouldn't have had a problem if he'd been investigated by a well trained investigator who was knowledgeable about her obligations in law.

Judge told him that this was a Vukelich application to persuade her to approve a voir dire. "Tomorrow the Crown will try to persuade me not to hold a voir dire." And so the day finally ended with the Crown at bat in the morning.

This application is doomed. Tomorrow the Crown will eviscerate him in about twenty minutes and the judge will give the post-mortem.
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Re: Keith David Lawson - Poriskyite Tax Evader

Postby notorial dissent » Fri Jul 22, 2016 1:54 pm

My that was a thrilling and fun filled day, and I feel considerably dumber now for having read through it. He obviously didn't know where he was going and thus didn't know when he didn't get there. I would imagine the Crown's case will be fairly short and succinct and hopefully to the point.
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Re: Keith David Lawson - Poriskyite Tax Evader

Postby ArthurWankspittle » Sat Jul 23, 2016 1:02 pm

So if you have a hobby, like a travel lust that you partly finance by claiming the expenses as a business expense, tough. It has none of the hallmarks of a business and your costs are not deductible.
That's you out then - no point hanging on to those beer receipts for your tax return. :lol:
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Re: Keith David Lawson - Poriskyite Tax Evader

Postby Burnaby49 » Sat Jul 23, 2016 3:40 pm

ArthurWankspittle wrote:
So if you have a hobby, like a travel lust that you partly finance by claiming the expenses as a business expense, tough. It has none of the hallmarks of a business and your costs are not deductible.
That's you out then - no point hanging on to those beer receipts for your tax return. :lol:


Didn't you understand my explanation of Stewart at all? Lawson was trying to use Stewart perversely, as a fig leaf to justify his income tax evasion. He claimed it allowed him to not report income he'd made from his 'hobby'. Obviously I haven't as yet made any money sacrificing my time and health consuming all that foul, flat, room-temperature swill in all those dank noisy pubs.

Expenses are a different matter. What personal component could there have been for me in forcing down all those noxious brews? Ask Peanut, did I seem to be getting any enjoyment out of it? Stewart clearly supports my tax claim for expense deductions for it all. It was nothing but work I tell you, research for my pending book, "Swilling ale in Britain, a Guzzler's journey".
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Re: Keith David Lawson - Poriskyite Tax Evader

Postby notorial dissent » Sat Jul 23, 2016 4:28 pm

Gee, I'd like to get me one of those kind of hobbies that net me $230,000, even Canadian, that I don't have to pay taxes on, all of mine just cost me money. Where do I go to sign up?
The fact that you sincerely and wholeheartedly believe that the “Law of Gravity” is unconstitutional and a violation of your sovereign rights, does not absolve you of adherence to it.

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Re: Keith David Lawson - Poriskyite Tax Evader

Postby Burnaby49 » Sat Jul 23, 2016 8:14 pm

July 21, 2016

Day two of the Vukelich application. Not as long as day one because the Crown had its turn and was admirably brief. Lawson still got another shot however although, as you'd expect, nothing new.

Yesterday ended with Lawson having given his reasons why he should be allowed a vior dire to go traipsing through CRA records and spend the next decade or two cross-examining CRA staff. As the judge said, a fishing expedition. Today was the Crown's turn where they argued that his voir dire application should be denied.

He said he needed to get the day's proceedings done quickly because he had to watch his kids after lunch so he needed this to end by 1:00. Crown said no problem, fine by the judge too. I was all for it. Another day like yesterday would test even my legendary capacity for boredom.

So Crown counsel got up and gave her mercifully short presentation. Counsel said that she had filed her written submission electronically on July 8th and would not go through it line by line. Eight pages twenty nine paragraphs.

This hearing is to determine if the court should allow the voir dire application. It is the Crown's position that there should be no voir dire.. There is no possibility of success. I have two points regarding Mr. Lawson's statement;

1 - Lawson's application is a collateral attack.
2 - It is a continuation of his OPEC views.

Paragraph five of the submission outlined the procedural history. This application is a repetition of prior arguments. The rules do not allow a collateral attack. Judge - In two previous decisions I reviewed (note - one was the Preliminary Inquiry) I don't see the issue of the manner in which LI conducted investigation square on. Crown - I suggest square on is accurate. The issue has been answered in several ways. Throughout these entire proceedings the course has been the same, issues on how the Crown and court interpret the Act. LI is accused of negligence because she did not interpret the Act properly is one and the same issue reworded. He's been doing this from day one. The issue has evolved and worded differently but it is still the same issue. Hobby, taxable, all are part and parcel of the Paradigm belief.

Without going into details regarding law this is not the proper time to litigate the issue of what is the proper law. That was done at the trial in the summary to the jury. Lawson has not set out any basis for an abuse of process voir dire. He has said nothing that grounds a Charter violation. His claims of negligence by Investigations and the Crown are serious accusations. The complaints are not recording violations of his rights. This is not an application about full disclosure, loss of documents, illegal searches, none of these exist.

We have been unable to find an abuse of process decision after conviction that supports Lawson's position and Lawson has provided no support of his position either. The judge said that the only similar case she knew the application was denied.

On to paragraphs 5 and 6 of the submission. It is the Crown's view that the allegation that LI was negligent is the same as his complaint that the CRA did not have grounds to charge him. At the Preliminary Inquiry judge Meyers said that there was ample ground for the Crown to proceed.

Then she talked about the awarding of costs. "The Crown is not aware of any case that awarded costs where the Crown was successful". She cited the Eddy case where costs were awarded to the Crown against Denise Eddy, another Poriskyite tax evader, for trying a collateral attack on a prior decision. Crown said they were not seeking costs against Lawson but there is support for it.

Denise Eddy is discussed here;

http://www.quatloos.com/Q-Forum/viewtopic.php?f=50&t=9899

This is the case Crown referred to;

R v Eddy, 2014 ABQB 391
http://canlii.ca/t/g7wj9

It was appropriate to embark on a Preliminary Inquiry. Lawson has not set up any basis that could ground an application. He has made simple bald assertions and nothing more. Lawson disagreeing with the Crown on law is not grounds for an application. Further cross-examination of CRA investigators would not be appropriate.

It is the Crown's position that Lawson did not support these bald assertions. He repeated them but did not back them up. This is not the place for relitigation. Lawson said that if he gets his voir dire he would cross-examine LI, testify himself, and call his wife to testify. His wife's proceedings are not an issue here. This evidence would not assist the court on whether there has been an abuse of process.

This is really an attempt by Lawson to appeal his conviction. These issues have been litigated three times (I missed the references). Lawson has argued that there were insufficient grounds before trial. He did it again at trial and was convicted. Crown noted Lawson's conduct during the trial. All of the issues here relate to legal issues which must be remedied in the court of Appeal.

Crown Cited Jordan, a Supreme Court of Canada case;

R. v. Jordan, 2016 SCC 27
http://canlii.ca/t/gsds3

But I was getting behind and missed the relevance. This is a very recent and very important case on undue delay but that wasn't the issue cited by the Crown. Crown also cited Jarvis v Morlog, 2016 ONSC 4476. another very recent case. I've written up Jarvis here;

http://www.quatloos.com/Q-Forum/viewtopic.php?f=48&t=11161

Crown cited paragraph 63;

[3] All litigants are entitled to treated with respect and with simple human decency before the court. The OPCA positions that they adopt are not. In my view, it is more respectful to OPCA plaintiffs to truthfully tell them that they are engaged in a despicable enterprise that cannot be tolerated than to pretend that there is some merit which deserves academic debate and response. In my view, precious judicial time should be spent on resolving real matters. Simply taking judicial time to respond seriously to OPCA claims gives the claimants a measure of success in advancing their improper purposes. Associate Chief Justice Rooke spent more than enough of his very valuable time creating a textbook of abusive OPCA practices in Meads v. Meads. In my view, not another moment of judicial resources or party expense should be invested on OPCA claims. They should be summarily nipped in the bud with reference to Meads v. Meads and no more as set out in para. 2 above.


Crown said that Lawson was just engaged in collateral attacks and OPCA arguments and the Crown encouraged the court to dismiss the application. Lawson has not provided anything to support a section 7 or section 21 Charter application.

Judge - I understand from Lawson's submission that there were two areas of negligence. I take you point on the interpretation of law. I would like a submission regarding process. Should there have been more notes? Not notes that haven't been released but notes not kept?

I found this comment very surprising since, as I've reported, yesterday the judge had agreed with the Crown that there was no requirements to take notes;

Lawson's concern was about note-taking by the CRA while they were investigating him. As far as I could tell he meant internal notes and records of all meetings, discussions, decisions etc made by any CRA employee engaged in investigating his tax affairs. He was complaining that the CRA did not take sufficient notes for him to follow the internal process that led to his Preliminary Inquiry. Lawson said that the McCartie decision cited above resulted in some relief to the McCarties based on the lack of notes and records. The case showed that the CRA had a duty to keep notes. Which was entirely wrong. What the McCartie decision said was that the CRA had no duty to take notes but if they did take them they had a duty to safeguard them and produce them on respect. The judge imposed sanctions against the CRA, not because they didn't keep records but because they lost the ones they made. In this case Crown has said that all notes made in the Lawson investigation were provided to him so the McCartie decision in no way supported Lawson's contention about a requirement to note every little thing that happened in an investigation.

Our judge picked up on this too and said that the omission to make notes wasn't culpable. "They were under no obligation to make them. This case (McCartie) does not establish your argument that there was a duty to make notes. Your point is that their omission to take notes hindered their rights to a fair trial". Lawson - They are not free to do what they want. There has to be some standard. He's apparently invented a standard of conduct for the CRA in respect to note-taking even though, as McCartie showed, there is no legal obligation to take them.


Crown - With respect to the notes and there being insufficient notes there were an abundance of notes, papers and working papers. Lawson seems to expect more notes but I don't know what he expects to find. This is just a fishing expedition. She referred to McCartie about the issue of requiring to make notes.

Judge had also made a very vague comment about policy manuals that I didn't understand. Nor, apparently, did the Crown. Crown - I'm not sure I follow your question about policy manuals. Judge - The Investigation's failure to follow the policy manuals. Mr. Lawson made reference to sections of policy manuals he felt weren't followed.

Crown responded by saying that this issue had come up in a variety of cases and that the policy manuals Lawson talked about didn't exist. They existed for audit but not used by Investigations. In any case they were simply considered guidelines. It doesn't matter if the investigators followed guidelines, what mattered was if they followed the law. The law has been decided and this is a collateral attack. To make a clear distinction between McCartie and this, there is no comment from Lawson that more notes would have changed the issue. This ended the Crown's arguments so we had a fifteen minute break before Lawson's rebuttal.

Lawson started by saying he would argue "the OPCA thing." Crown had brought up collateral attack. It is my inability to clearly express myself rather than a collateral attack. A sad story about how hard he was trying and learning from his mistakes. I agree that there is not a (specific?) relief for searches or other issues which is why I am claiming a residual relief. The public expects investigators to have been trained properly (here we go again). A stay of proceedings is drastic but it is my only recourse. (Note - not true, he could have appealed his conviction rather than try and embark on re-litigating his case). This is not an end-run around the requirements to appeal. The Preliminary Inquiry brought up a significant lack of knowledge of law. Had LI been properly trained the Preliminary Inquiry might have ended differently. I suspect that there were more meetings with notes that I haven't received. I want to cross-examine LI on her training and lack of notes. The manuals exist. In this trial two Crown witnesses said that they were familiar with manuals and were aware of their responsibilities. So manuals are relevant.

OPCA. I'm unrepresented, I have no legal advice, I'm learning. I've learned things in the past five years and wouldn't make same arguments now.

My overall concern is with Investigations and how they brought the prosecution. I don't have evidence to support my allegations. Allegations that the Crown knew that Investigations was incompetent but didn't do anything. Judge - Is that an argument you are making? He waffled. Judge - You have no issues with the Crown in this application? Yes. Rambled on how he wasn't OPCA. They were strange people. He seemed to be distressed by the unfairness of it all. He said that he had a Charter right to competently trained investigators.

To sum up my grounds I have a residual right to Charter relief. I could get evidence from witnesses to show that there should have been notes taken. If meetings were held there should have been notes. If there were no meetings there should have been notes say why. Why were notes not kept? They would have shed light on why May (his wife) was charged. I could have cross-examined LI better with notes. In other words, just as the judge had said, he wanted carte blanche to conduct a fishing expedition.

LI investigated me on the same basis as the Stewart case paragraph 60. She used the same logic to assume that I was taxable.

This is paragraph 60;

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.’”


She called my hobby a business without reference to proper legal tests so she really had no basis to lay charges against me. The court needs to send a message about the failure of reasonable expectations of competence and training of CRA staff.

Then he was done and judge asked Crown counsel if she wanted to speak. I waited with apprehension because this would allow Lawson to go at it yet again in rebuttal. Thankfully she said "Nothing further to add My Lady".

Judge ordered break so she could check her schedule to determine when she could give her decision. After break she settled on tomorrow at 11:30 and said it would take 30-40 minutes. I won't be there, I'll be having a beer on a pub patio with some old friends from the CRA but I'll find out the results.

Lawson said that he wanted the DARS disc of today's hearing. This is the recording of proceedings that has replaced court stenographers. He needs court approval to get it. Judge asked why. Two reasons. First he had no idea what he said today and needed to review it. I can believe that. Secondly if he loses on the application he'll need it for the appeal. Judge asked Crown if she had any objections. "It's of limited utility but no objections." So it was "Order In Court" and we were done."

After Lawson's shambles of a presentation yesterday it was a pleasure to listen to Crown's structured, planned, presentation that worked through issues to a conclusion. Yesterday Lawson just stopped from exhaustion as much as anything else but, had he continued, it would have just been yet more repetition of all of his grievances against incompetents who did not understand the genius of his income tax analysis. Not that we didn't get a taste of that on rebuttal today.
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Re: Keith David Lawson - Poriskyite Tax Evader

Postby Burnaby49 » Sat Jul 23, 2016 8:19 pm

July 22, 2016

The decision has been given and Lawson’s application was dismissed in its entirety. The judge read her decision orally but hasn't yet finished the final written copy but it will apparently be available in due course. Then we're on to the inevitable appeal where, no doubt, I'll hear Lawson go on for hours repeating exactly the same rambling semi-coherent irrelevancies I've reported on at this hearing.

To sum up my view on the application; I agree completely with the Crown that this whole failed attempt to get a rehearing was just Lawson's way of trying to re-litigate his belief that his Poriskyite interpretation of tax law was correct and everybody else was wrong. Let's go through the list of Lawson's issues that I posted at the first day of the hearing.

1 - The investigator wasn't trained properly.

How did he know they weren't trained properly? Because LI didn't agree with his interpretation of the law and drop the investigation. Since he was right she obviously wasn't properly trained in income tax law.


2 - The investigator didn't know what income was and had no understanding of tax law.

Why not? Because LI didn't agree with his interpretation of income and tax law and drop the investigation. So she obviously had no understanding of income tax law.


3 - The investigator, and others in the investigation, did not take adequate notes of their internal processes, meetings, and decisions.

Why didn't they? Because LI realized that his interpretation of the law was correct but she decided to hide this and prosecute him anyhow.


4 - If they did take notes they have hidden them from the Crown counsel and the court.

Why did they hide them? Because LI realized that his interpretation of the law was correct but she decided to hide this and prosecute him anyhow.


5 - He sent the investigator a letter saying he was innocent of tax evasion and explained why but they did not stop the investigation.

Why did they continue? Because even though he explained his interpretation of income tax law in the letter LI, not understanding tax law, didn't agree with him and drop the investigation.


6 - They investigated on the basis of the presumption of his guilt but did not investigate him on the presumption that he was innocent.

Why not? Because LI didn't agree with his interpretation of income tax law and drop the investigation.


7 - The Supreme Court of Canada had stated in a landmark decision that Canadian taxpayers have the option of categorizing their income as being derived from either a business or a hobby. If they declare their income to be derived from a hobby they cannot be reassessed or audited by the CRA. He told Investigations that his Paradigm work was a hobby and therefore not taxable but they ignored this and charged him anyhow. He was obsessed with this point because he had the Supreme Court case which clearly backed him up.

Why was he ignored? Because LI, not having any understanding of tax law, didn't agree with his interpretation of the Stewart case and drop the investigation.


8 - Both he and his wife were charged with tax evasion. The Crown dropped his wife's charges but didn't drop his. I think this was a point he made, he mentioned his wife's issues in fragments rather than a coherent argument and I wasn't paying a lot of attentions.

Why? Because LI didn't agree with his interpretation of the law and drop the investigation.
"Yes Burnaby49, I do in fact believe all process servers are peace officers. I've good reason to believe so." Robert Menard in his May 28, 2015 video "Process Servers".

https://www.youtube.com/watch?v=XeI-J2PhdGs

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Re: Keith David Lawson - Poriskyite Tax Evader

Postby Arthur Rubin » Sat Jul 23, 2016 10:23 pm

Burnaby49 wrote:July 21, 2016
This hearing is to determine if the court should allow the voir dire application. It is the Crown's position that there should be no voir dire.. There is no possibility of success. I have two points regarding Mr. Lawson's statement;

1 - Lawson's application is a collateral attack.
2 - It is a continuation of his OPEC views.


He is an oily character, but that doesn't seem quite correct.
Last edited by Arthur Rubin on Sat Jul 23, 2016 10:35 pm, edited 1 time in total.
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