B.C. Supreme Court dismisses 'natural person' lawsuit against CRA, TD Bank

Canada Revenue Agency (CRA) national headquarters in Ottawa on Friday, June 28, 2024. (Sean Kilpatrick / The Canadian Press)

A British Columbia man who describes himself as a "natural person" who is therefore exempt from paying income taxes has lost his attempt to sue his bank and the federal government for removing the funds from his account.

Daniel Blake filed the lawsuit against TD Bank and the Canada Revenue Agency, accusing both of theft, fraud and negligence for removing more than $12,000 from his bank account to pay down some of his personal tax debt.

Writing in her decision last week, B.C. Supreme Court Justice Barbara Norell found the CRA had written to Blake in 2021 requesting that he file his outstanding tax returns for 2013 to 2019.

In response, Blake told the CRA that he had not signed any contract agreeing to pay income taxes and therefore he had no obligation to do so.

"He claims that he is a natural person, he has not agreed to pay taxes, and the government cannot impose any obligation on him to pay taxes," Norell summarized in her decision.

Blake's notice of civil claim stated that in March 2023 he discovered his chequing account was empty and his savings account was frozen.

On further investigation, he found $12,671 had been removed from his chequing account to pay the CRA, which he accused of fraud and theft.

He further argued that TD bank was negligent or complicit in the theft, saying the bank should have safeguarded his account against such unauthorized transactions.

The judge dismissed Blake's claims broadly but declined to rule on the allegation that TD Bank was negligent, finding neither party filed any evidence with respect to the negligence claim.

The judge granted TD Bank leave to bring an application to dismiss the negligence claim in the future if it chooses to do so.

The CRA describes "natural persons" as tax protesters who have fallen victim to a scheme that can bring serious consequences for participants.

A 2017 warning from the revenue agency says those who claim they are exempt from paying taxes due to personal choice can face fines and jail time.

The CRA says tax protesters from across Canada were fined $7.15 million and sentenced to a total of 936 months in jail between 2006 and 2017.