International Journal of Coercion, Abuse, and Manipulation Volume 6 2023 110
2011 TCC 166 Kim v The Queen, 2017 TCC 246,
respectively).
A new unconventional argument was also deployed by
three Fiscal Arbitrators appellants: the Income Tax Act
purportedly breached the Canadian Charter of Rights
and Freedoms prohibition against discrimination
by discriminating against humans by denying them
corporate taxation status (Bradshaw v The Queen,
2017 TCC 123 Engel v Canada, 2017 FCA 122 Grier
v Canada, 2017 FCA 129). This argument was rejected
in all three instances.
The “Appeal Quashed” category are the most likely
unreported court decision candidates where taxpayers
continued pseudolaw or unconventional strategies.
That was only 0.68% (N=443) of Fiscal Arbitrators
appeals that did not result in a reported decision. That
low frequency also supports that Fiscal Arbitrators
taxpayers generally abandoned pseudolaw.
Both Watts and his wife personally filed appeals of their
CRA re-assessments. In each case these individuals’
appeals were dismissed when the Watts did not appear
at appeal hearings (Lawrence Watts -Watts v The
Queen (23 August 2016), Toronto 2014-1231(IT)G
(TCC) Miriam Watts -Watts v The Queen (27 June
2016), Toronto 2010-3180(IT)G (TCC)). A subsequent
Federal Court of Appeal challenge by Lawrence Watts
was dismissed (Watts v Canada, 2015 FCA 138).
Miriam Watts unsuccessfully deployed a pseudolaw
foisted unilateral agreement strategy in her appeal
proceeding (Watts v The Queen, 2016 TCC 148). Other
identified Fiscal Arbitrators promoters did not conduct
Tax Court of Canada proceedings in relation to their
personal income tax obligations.
Parties have an absolute right to appeal decisions of the
Tax Court of Canada to the Federal Court of Appeal.
Four (13.3%, N=30) of the unsuccessful Decision
Dataset Tax Court of Canada appeals by lawyers were
then appealed to the Federal Court of Appeal. All four
appeals were unsuccessful, and none sought a further
review at the Supreme Court of Canada. A minority of
self-represented Decision Dataset appellants (29.3%,
N=27) initiated eight Federal Court of Appeal appeals:
six dismissed, one abandoned, and one discontinued.
The different frequencies of represented versus self-
represented appellant appeals is not statistically
significant: x2(1, N=58)=2.049, p=0.153. One self-
represented taxpayer then sought and was denied
leave to appeal to the Supreme Court of Canada (Elio,
A Flesh and Blood Human Being, of the Family Dalle
Rive, Authorized Representative of Elio Dalle Rive v Her
Majesty the Queen (14 August 2014), Ottawa 35874
(SCC)). As is obvious from that style of cause, Dalle
Rive had continued to advance pseudolaw claims.
Interestingly, nearly two thirds (62.5%, N=8) of the
self-represented taxpayer appeals to the Federal Court
of Appeal were by the minority of self-represented
taxpayers who had continued to advance pseudolaw
and/or unorthodox legal claims in their Tax Court
of Canada proceedings. That fraction of the Decision
Dataset self-represented appellant pool was twice as
likely to continue their litigation after their failure at
the Tax Court of Canada, a difference that is unlikely
to be the result of random chance: x2(1, N=28)=6.318,
p=0.012.
D. Fiscal Arbitrators Taxpayer Recruitment,
Pseudolaw Belief, and Scheme Inducement
The majority of the Decision Dataset appeals provided
some narrative or explanation of how the taxpayer was
introduced to and recruited into the Fiscal Arbitrators
scheme. This information, usually the personal
testimony of the taxpayer or an agreed statement of facts,
was critical for the taxpayer to counter gross negligence
penalties imposed by the CRA, and to explain why the
taxpayer had not acted in an unreasonable manner,
or was not willfully blind, when the taxpayer signed
income tax returns that claimed very large but entirely
fictitious business loss expenses.
The Court’s evaluation of the truthfulness of these
taxpayer narratives was generally favorable. Decision
Dataset judgments only expressing any concern about
the credibility of the taxpayer in 29.1% (N=55) of cases.
A large proportion (80.3%, n=53) of the Decision
Dataset taxpayers provided an explanation of how
they were introduced to and recruited into the Fiscal
Arbitrators scheme. Table 4 summarizes the contact
mechanisms involved in that process:

ISSN: 2710-4028 DOI: doi.org/10.54208/1000/0006 111
Table 4 -Table of introduction and recruitment mechanisms reported by Fiscal Arbitrators Decision Database
taxpayers (N=53). The total number of items in this table is greater than 53 since certain taxpayers reported multiple
introduction and recruitment mechanisms. The tax preparer in both instances was Fiscal Arbitrator promoter
Carlton Branch.
A striking aspect of Table 4 is that in practically each
case, the taxpayer was introduced to Fiscal Arbitrators
via a pre-existing relationship with someone who was
not a Fiscal Arbitrators guru. Sometimes that link had
a financial, business, or professional aspect (15.1%,
N=53). A substantial fraction (20.8%, N=53) of the
Fiscal Arbitrators Decision Dataset taxpayers were
already involved in questionable income tax practices,
and simply expanded on that pre-existing activity.
However, the majority of new Fiscal Arbitrators
clientele had been essentially lawful taxpayers, until
they were introduced by friends, family members, or
coworkers to the extraordinary promised benefits of
this pseudolaw tax avoidance program.
A consistent narrative emerges in Decision Dataset
reports on how taxpayers interacted with Fiscal
Arbitrators. Fiscal Arbitrators taxpayers entirely relied
on promoters and/or contacts to prepare income
tax returns. Customers handed their tax-related
information and prior tax returns to Fiscal Arbitrators.
Fiscal Arbitrators prepared and provided the income
tax return paperwork that claimed the false Strawman
business expenses. Fiscal Arbitrators customers were
told to sign those documents, and add “per” prior
to their signature. If the CRA wrote the taxpayer,
taxpayers were told to hand over that correspondence
to their Fiscal Arbitrators contact(s).
Almost half of Fiscal Arbitrators taxpayers explained
in their testimony that they trusted Fiscal Arbitrators
promoters who they believed were income tax experts
(48.4%, n=32). However, the basis for that belief is
tenuous. Only a third (31.8%, n=21) of the taxpayers
described formal meetings or seminars where the
Fiscal Arbitrators scheme was presented and explained.
Rarely (13.6%, n=9) are the promoters described
as acting in a manner and/or dressing like financial
or legal professionals. Only 7.6% (n=5) of Fiscal
Arbitrators customers described attending an office
or other business location. This last point is one that
Tax Court of Canada justices repeatedly identified as
a potential reason to question the validity of a scheme
that promised huge tax advantages. For example, why
would a tax preparer, who possesses expert, if not secret
knowledge, be meeting customers in a Tim Hortons
(Anderson v The Queen, 2016 TCC 93), or a “Dave and
Busters” restaurant/games arcade (Sledge v The Queen,
2016 TCC 100), or a coffee shop (Mahdi v The Queen,
2018 TCC 149)?
There were rare instances where the Tax Court of
Canada did conclude the circumstances around Fiscal
Arbitrators recruitment provided a valid explanation
for a taxpayer adopting that strategy. For example, in
Lavoie v The Queen (2015 TCC 228), a taxpayer couple
who only spoke French attended Fiscal Arbitrators