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Brian and Terry Leblanc were once a couple of average guys, spending their days washing windows and their nights drinking beer and watching sports on TV.

In the late 1980s, the brothers won about $90,000 at Toronto's Woodbine race track and decided to put that money toward more sports betting. Within a few years, the Leblancs were managing a full-time betting operation from their home in Aylmer, Que., wagering up to $300,000 a week mostly on games such as Pro-Line.

Their strategy was simple: bet huge amounts on events with incredibly long odds. Naturally, they lost most of the time, but, when they won, they won big. They pocketed $1.7-million three times -- on two bets in 1996 and one in 1999 -- and won about $5.5-million from 1996 to 1999. During that period, they wagered $52-million.

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It wasn't long before the Canada Revenue Agency took note. In 2000, the agency sent them a notice of reassessment for the years 1996 to 1999, saying their gambling was a business and subject to tax.

The CRA was convinced the men used a "system" to make bets and noted their operation included a computer program to manage wagers and as many as 15 paid helpers. The brothers denied using any system, saying they relied only on luck. And, they added, gambling winnings were not taxable.

The case ended up at the Tax Court of Canada and, last week, Mr. Justice Donald Bowman ruled in favour of the Leblancs.

"It is true, they won but to say they won because they had a system has no basis in the evidence at all," Judge Bowman said in his ruling.

"They won in spite of having no system. If one is looking for a pattern, it is that they bet massively and recklessly and in those games where they could, they bet on long shots. Certainly it meant that if they won they won big, but the converse is that if they lost, they lost big and, given the astronomical odds against winning, their chances of losing were far greater than their chances of winning."

The judge said the Leblancs were compulsive gamblers, but they were not running a business and their winnings were not taxable.

William Vanveen, an Ottawa lawyer who represented the brothers, said the ruling was an important victory for gamblers everywhere.

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"What it boiled down to was that luck is not taxable," Mr. Vanveen said yesterday.

In order to win its case, he said the CRA had to prove that the men developed a system to minimize their risk, something like a pool shark who practises by day and then takes on unsuspecting drunks by night.

"The mistake CRA made was they just looked at the volume [of betting]and said all this volume amounts to a business," Mr. Vanveen said. "These [lotteries]are advertised and are accepted to be tax free. [The brothers]have a big win, they don't work after that, so what's the problem?"

The lawyer representing CRA was unavailable for comment. The CRA could still appeal the ruling.

As Judge Bowman noted, the Leblancs led unusual lives.

They grew up in the Toronto area and had little more than high-school education when they joined their father's window-washing business in the 1980s. After winning money on the track, they decided to jump into Pro-Line, which was launched in 1992. They lost about $10,000 in their first year, but soon scored big with two $1.7-million wins in January and February of 1996. By the mid-1990s, they moved to Aylmer, near Ottawa, so they could play both Ontario and Quebec lotteries. They kept their lives simple, driving old cars and eschewing flashy jewellery.

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"They spent their time playing lottery games or watching sports on television," the judge noted. "They also played Ping Pong and golf and sat around the house drinking beer and eating pizza."

Not everything went well. Around 1996, Terry Leblanc fell in love with a stripper named Josée Dubreuil and showered her with gifts, including an $850 engagement ring, $2,000 for breast implants and $14,000 in cash, according to court records. The relationship ended after Ms. Dubreuil stole $124,000 worth of winning lottery tickets from a jar the Leblancs used to store winning bets (the theft prompted them to buy a safe). Ms. Dubreuil was later convicted and given an 18-month suspended sentence.

In 2000, they also got into a spat with dog-racing regulators in Australia who withheld nearly $200,000 the brothers won via an online bet. The Australians alleged manipulation but eventually backed down and gave the Leblancs their winnings.

Brian, now 35, and Terry, 41, were not available for comment yesterday. According to Mr. Vanveen, Terry still lives in Canada while Brian has moved to Britain.

Both are still gambling, he said. "Not like they were before."

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