Article content continued

It’s literally a betrayal and I feel we can’t just sit idly by

The women allege the deal violates the Charter of Rights and Freedoms because it exposes them to potential U.S. criminal penalties without a hearing, it allows their financial information to be seized without a warrant, and because it discriminates between those defined as “U.S. persons” and everyone else.

“This is an infringement on Canadians of U.S. origin by our Canadian government. It’s literally a betrayal and I feel we can’t just sit idly by and let it happen,” Ms. Deegan said in an interview.

The women are represented by Vancouver law firm Farris, Vaughan, Wills & Murphy LLP and Joe Arvay, one of Canada’s top constitutional lawyers. Mr. Arvay’s previous cases have included civil rights challenges in many areas, among them assisted suicide and gay marriage.

U.S. tax law says that all “U.S. persons” are liable for U.S. tax, regardless of where they live in the world. FATCA compels financial institutions from outside the U.S. to collect the financial information of those deemed to be U.S. persons and submit it to U.S. authorities. The law penalizes banks who fail to supply the information.

In addition to the alleged Charter violations, Ms. Deegan and Ms. Hillis claim the Canada-U.S. deal violates the division of federal and provincial powers because the Constitution Act, 1867, states that provinces have exclusive control over matters involving privacy and property rights.

Ms. Deegan, who was born in Washington State in 1962 to a Canadian and a U.S. citizen, moved to Canada in 1967. She has neither worked nor resided in the U.S. since she was five years old and she has never had a U.S. passport.