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of 155
CONTENTS
4
of
155
3 questions to answer:
i) What is Law?
1. WHAT IS LAW?
Law
is
ubiquitous,
it
is
everywhere,
and
you
bump
into
it
everywhere.
Law
is
a
subset
of
rules
and
are
differentiated
in
the
formalities
of
documentation
and
enforcement.
Sanctions
means
that
you
are
subject
to
punishment
and
they
differentiate
law
and
rules.
David
Humes
was
a
Scottish
philosopher
in
the
17th
century.
Humes
distinguished
between
physical
and
normative
laws.
Physical
laws
are
laws
of
nature
in
physics,
chemistry
and
biology.
For
example,
the
law
of
gravity
or
law
of
inertia.
Normative
laws
are
some
of
the
rules
governing
human
conduct
made
by
humans.
For
example,
the
law
of
stealing:
one
should
not
steal,
but
not
that
you
cant
physically
steal.
Rather
it
indicates
or
commends
that
you
shouldnt
steal
and
if
found
guilty
you
suffer
the
consequences.
You
may
break
the
law
and
suffer
the
consequences,
because
it
is
a
decision
of
free
will.
Therefore,
physical
laws
cannot
be
broken,
but
normative
ones
can.
Humes
also
distinguished
between
normative
rules.
Some
normative
rules
were
law
because
they
created
a
code
of
behaviour
with
formalized
sanctions
in
order
to
live
by
that
code.
Laws
are
created
by
formal
processes
of
enforcement
and
adjudication.
Formalized
sanctions
by
formalized
societal
institutions
distinguish
normative
law
from
general
rules.
How
are
sanctions
created?
There
are
2
sanctions
for
drinking
and
driving:
1)
the
criminal
code
and
2)
the
highway
and
traffic
act
(provincial).
They
are
created
by
politicians.
- License
suspension
(1
year
federally,
1
additional
year
in
MB),
car
is
impounded,
jail
/
fine,
course,
points
against
license
- legislature
of
MB
and
parliament
of
Canada
have
created
these
statues
which
describe
these
sanctions
5
of
155
Laws
are
not
value
neutral,
they
manifest
from
the
political/philosophical
values
of
the
law
maker.
Generally
they
emerge
from
the
law
makers.
There
is
a
clear
relationship
between
law
and
politics
laws
come
from
political
institutions.
Laws
are
the
methods
by
which
politicians
actualize
their
political
agendas.
Legal
philosophies
are
basically
dressed
up
political
philosophies.
The
process
that
leads
to
law
(most
significant)
is
the
legislature
(at
least
in
Canada).
For
example,
the
highway
traffic
act
is
made
by
legislature.
1) legislative assembly who are elected to position and are politicians and
3) and
lieutenant
government
(provincial).
The
monarch
approves
the
bill
by
the
legislative
assembly.
Essentially
the
laws
are
the
crystallized
product
of
the
political
process.
Law
is
not
unique,
detached
or
discrete.
Politics
govern
through
law.
Legal
philosophy
is
jurisprudence
another
word
for
legal
philosophy,
it
is
a
reflection
of
schools
of
general
philosophy.
Legal
philosophy
is
simply
schools
of
philosophy
that
look
at
law.
There
are
3
different
schools
of
jurisprudence:
a. natural law
b. legal positivism
c. legal realism
a.
Natural
law
is
made
up
of
2
subcategories
who
are
both
trying
to
ask
the
same
question:
What
should
the
law
be?
i.
Classical
Conservative
View:
old
school,
gets
its
origins
from
Thomas
Aquiness
and
Edmond
Burk
(founder
of
modern
conservatism).
This
school
states
that
the
law
should
be
based
on
eternal
fundamental
truths
inspired
by
God.
These
truths
or
moral
principles
are
perceived
in
history,
customs
and
scriptures
and
should
be
replicated
in
society.
They
are
metaphysically
created.
6
of
155
ii.
Deistic
Natural
Law:
believes
that
it
rests
NOT
on
Devine
inspiration,
but
on
the
assumption
that
rational
people,
by
applying
their
inheritabilities
of
reason
and
logic
to
their
perception
of
the
world,
will
arrive
at
basic
principles
of
justice.
It
is
mans
faculty
of
reason.
Believers
of
this
school
are
Thomas
Pane,
Thomas
Jefferson,
Pierre
Trudeau,
and
John
Lock,
Karl
Marx,
Liberal
rationalists,
etc.
b.
Legal
positivism
is
only
concerned
with
What
is
the
law?
It
is
like
a
social
science
because
it
doesnt
evaluate
the
law.
It
wants
to
be
value
neutral.
It
identifies
legal
principles.
The
founder
of
positivism
is
August
Compt
(founder
of
sociology).
Sociology
emerged
because
scholars
in
the
humanities
were
jealous
of
scientists
getting
all
the
praise
and
notoriety.
They
suggested
focusing
on
the
scientific
method
(methodology),
breaking
down
the
methods
and
isolating
one
variable
for
testing
and
applying
it
to
the
humanities.
They
applied
the
scientific
method
and
got
sociology.
Positivists
hold
that
true
knowledge
is
only
things
that
can
be
scientifically
tested:
they
felt
that
the
only
things
tested
through
this
methodology
is
considered
fact
(i.e.
Fact
value
distinction),
otherwise
it
is
merely
thoughts
and
values.
2) identify
and
interpret
the
law
as
created
by
the
sovereign
authority
under
different
methods
and
different
cases.
The
problem
is
that
it
doesnt
have
an
evaluative
function,
it
simply
tells
you
what
the
law
is
and
it
doesnt
evaluate
whether
or
not
it
is
a
good
law.
c.
Legal
realism
is
concerned
with
Why
the
law
is
what
it
is?,
why
are
decisions
made
in
the
manner
they
are
made
by
the
judges
/
courts.
They
dont
look
at
what
are
the
rules,
but
they
have
to
be
positivists
in
order
to
look
at
why
the
law
is
created.
Use
scientific
techniques
as
to
why
the
law
is
created.
Therefore,
use
positive
techniques
(scientific
method)
to
discover
this.
All
practicing
lawyers
are
essentially
legal
realists;
use
some
techniques
of
legal
positivists
and
also
assess
how
a
judge
will
likely
respond
to
a
case
prior
to
trial.
More
Complete
Positivists.
Law
has
many
purposes
in
society.
Law
provides
consistency
and
guidelines
for
individuals
to
follow.
It
essentially
regulates
society.
Purpose
of
law
in
society
is
to
have
a
code
to
regulate
behavior,
provide
a
system
of
order
for
society
to
survive
and
continue.
Essential
qualities
of
society
are
freedom
from
violent
7
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155
conflict
and
the
assurance
of
reasonably
predictable
relations
among
human
beings
are
essential
qualities
of
society.
We
want
all
of
our
relations
to
be
fair
and
orderly.
Purpose
of
law
is
to
achieve
a
fair
and
orderly
relations
in
society,
but
this
is
a
political
view
which
differs
based
on
what
peoples
vision
of
a
just
society
is.
Market
economy:
driven
by
profit
and
exchange
(trading,
buying
and
selling)
freedom
with
little
to
no
government
intervention
in
exchange.
It
is
thought
competition,
benefits
of
increased
productivity
and
efficiency
will
arise
which
will
be
passed
on
throughout
society
Private
property:
you
have
to
have
something
to
trade,
but
is
it
socially
just?
2%
of
the
population
owns
95%
of
the
property.
How
is
capitalism
just?
Maybe
because
it
is
the
best
of
the
alternatives
b. Marxism (NDP):
Formula: from each according to his ability, to each according to his need
Private property and the market mechanism are tools of economic oppression
c. Jeremy Bentham:
Principle
of
utility:
the
greatest
happiness
of
the
greatest
number
(used
to
look
at
laws
and
assess
their
net
benefit)
By
the
scientific
study
of
peoples
needs
and
expectations
and
of
prevailing
values,
more
rational
adjustments
of
the
rights
given
to
competing
interests
could
be
made
to
improve
the
laws
of
society.
8
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155
1.
Does
the
law
influence
the
development
of
society
or
is
it
the
reflection
of
changing
value
in
society?
In
the
case
of
drinking
and
driving,
it
used
to
be
substantially
less
serious,
but
through
lobbying
groups
and
other
interested
parties,
the
laws
were
made
more
serious
which
influenced
society.
In
the
case
of
smoking,
law
was
ahead
of
peoples
views
and
health
concerns
arose,
made
it
illegal
to
smoke
indoors
(people
werent
marching
down
the
street
to
ban
smoking
in
restaurants
the
law
was
ahead
of
society)
2.
Can
scientific
method
be
used
to
improve
the
quality
of
law
making
or
are
scientific
methods
neutral
instruments
to
be
used
by
social
groups?
Yes
they
have
been
used
to
improve
the
quality
of
law
making
environmental
impact
studies
used
to
improve
laws
based
on
new
scientific
evidence.
Yes,
they
are
used
by
social
groups
as
neutral
instruments,
but
they
can
also
be
abused
3.
If
scientific
methods
can
be
effective
in
exposing
societys
ills
is
there
a
danger
that
they
will
destroy
the
myths
upon
which
society
depends?
A
myth
in
our
society
is
that
similar
cases
will
be
treated
similarly
however
socioeconomic
status,
race,
ethnicity
and
appearance
come
into
play;
convictions
are
much
higher
for
minorities,
therefore
the
myth
can
be
destroyed.
Roman
goddess
of
justice
is
called
Justitia,
portrayed
as
a
blindfolded
woman
holding
a
set
of
scales
in
one
hand
and
a
sword
in
the
other.
9
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155
i) Courts
ii) Legislatures
Procedural
law:
the
process
through
which
liabilities
can
be
enforced.
The
process
by
which
a
person
can
enforce
their
right
to
do
something.
Ex.
If
someone
hurts
you
in
a
car
accident,
you
can
get
money
from
them.
Substantive
law:
the
rights
and
duties
which
person
has
in
society.
It
is
the
law
that
tells
you
what
you
can
and
cannot
do.
It
makes
up
the
bulk
of
the
law
out
there.
Ex.
You
cant
run
someone
down
with
your
car.
Public
law:
concerned
with
the
conduct
of
government
and
with
relations
with
government
on
side
and
private
persons
on
the
other.
Divided
into
criminal,
constitutional,
administrative
laws.
Private
law:
composes
the
rules
governing
the
laws
between
private
persons.
When
disputes
arise,
the
persons
involved
may
go
to
the
court
to
have
their
rights
(liabilities)
decided
by
the
rules
of
private
law.
These
rules
are
the
basis
substance
of
contract
law,
tort
law,
property
law
and
civil
law.
- In
the
common
law
system,
judges
in
courts
create
principles
of
law
that
can
be
used
in
future
cases.
- They
dominated
society
until
the
early
20th
century.
Now
legislatures
have
the
power
10
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155
1. COURTS
The
courts
are
a
mechanism
of
settlements
of
disputes
and
are
the
most
formal
method.
Judges
determine
facts
and
apply
legal
principles
(Called
adjudication).
Create
common
law
Institution of dispute resolution however there are other institutes that do this as well
There
are
four
major
types
of
alternative
dispute
resolution
(ADR).
Exist
so
that
courts
arent
involved,
or
that
they
have
minimal
involvement.
Advantages
include:
looking
at
the
shortcomings
of
the
court,
bypasses
difficulties
of
going
through
litigation
process,
cases
are
resolved
much
quicker,
have
a
cost
savings
associated
with
them,
you
get
your
choice
of
adjudicator
or
mediator
if
one
is
required
(courts
have
lottery
system
for
picking
a
judge
for
the
case,
and
sometimes
judges
are
picked
who
have
no
background
in
that
type
of
law),
confidentiality
in
the
case
(there
is
public
record
for
court
cases),
preserving
the
ongoing
relationship
(courts
tend
to
push
parties
to
the
extreme,
which
leads
to
claimants
being
enemies
afterwards).
ADRs
dont
replace
the
courts.
The
ADRs
still
look
at
laws
made
by
the
courts
and
think
about
how
the
courts
would
resolve
a
similar
case.
1. arbitrators:
have
final
decision
making
authority,
they
hold
an
informal
trial
and
then
a
decision
is
rendered.
It
is
a
more
casual
trial
that
does
not
have
the
same
strict
procedures.
The
arbitrators
are
typically
experts
of
law
in
the
field.
2. mediator:
a
neutral
third
party,
can
only
suggest
a
solution
mediators
do
not
have
final
decision
making
authority.
They
bring
parties
together
and
suggest
solutions
which
are
not
binding.
Used
often
in
family
matters.
Not
used
in
commercial
matters
at
this
point
3. conciliation:
gets
the
party
talking
but
cant
suggest
anything.
Have
even
less
final
decision
making
authority
in
that
they
just
facilitate
discussions
and
cannot
suggest
anything.
Seen
in
labour
and
human
rights
discussions.
4. settlement:
disputes
resolved
but
not
by
the
courts,
however
they
pay
attention
to
methods
resolved
by
the
courts.
The
people
just
make
a
deal.
This
is
the
best
method
because
it
is
formalized
and
others
pay
attention
to
it
11
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155
All provinces are common law except Quebec (sources based on previous cases)
All states as well except for Louisiana because it was a French settlement
There
are
case
reports
that
explain
the
judges
reasoning
for
the
verdict
as
well
as
the
facts,
discussion
of
the
laws
and
the
holding
Plaintiff
(the
one
suing)
goes
to
court
to
fix
a
wrong
by
getting
a
remedy
(money
for
damages,
etc)
In
this
the
judge
has
created
a
legal
principle
called
a
ratio
decidendi:
the
narrowest
and
necessary
legal
principle
upon
which
the
decision
was
based.
The
most
basic
element
of
the
principle
of
law.
It
is
not
specifically
said
and
you
have
to
interpret
and
identify
it.
It
is
the
key
creative
element
of
the
courts.
The
principles
are
called
common
law
"judge
made"
(expositions
of
law
as
pronounced
by
the
court
of
law.)
Interpreting
legislative
instruments
and
seeking
to
discern
the
intent
of
the
legislation
and
effect
of
law
as
formulated
by
legislation.
Based
on
the
word
of
the
statute;
courts
want
to
determine
the
nature
of
the
legislation
and
the
judge
makes
final
decision.
Judges
arent
creating
a
new
concept
or
idea,
they
are
interpreting
how
legislation
applies.
Made
to
include
conjugal
(living
as
family
what
does
that
mean?)
cohabitation
with
minimum
of
3
years.
Property
split
up
50/50.
Intestate
Succession
Act
to
die
without
a
will.
Property
is
distributed
among
the
family
members.
This
process
or
a
will
needs
to
be
probated
by
a
lawyer.
(Probate
-
to
prove
and
read
the
will
and
fulfill
it)
12
of
155
2. Judge
made/Common
law:
Courts,
rather
than
interpreting
and
applying
legislatively
created
law,
is
declaring
the
law
in
areas
untouched
by
legislation.
The
law
established
by
the
courts
in
this
matter
is
the
core
of
what
is
known
as
judge
made
or
common
law.
Here
the
courts
are
themselves
making
authoritative
pronouncements
of
the
law
without
the
existence
of
legislative
enactive
laws
whose
intent
the
courts
are
generally
bound
to
follow
subject
to
the
process
of
interpretation.
The
courts
and
judges
are
themselves
making
the
law,
by
looking
at
the
ratios
of
previous
cases.
Takes
place
in
new
areas
where
legislation
does
not
exist
at
this
point.
Judges
had
lots
of
power
to
determine
the
principles
of
the
law.
Their
views
were
biased
of
value
of
both
philosophical
and
social.
They
were
liberal-capitalists.
This
was
common
until
the
~20th
century.
In
1066
there
was
the
battle
of
the
Normans
vs.
Anglo-Saxons
(William
the
Conqueror).
The
Normans
conquered
England,
but
retains
aspects
of
the
Anglo-Saxons
system
where
the
Lord
had
control
of
all
his
subordinates
below
him.
Retained
it
for
political
control
of
property.
Judges
dispensed
law
that
was
common
to
all
people
in
England.
By
1400,
the
common
law
courts
had
become
distinct
of
the
kings
court.
The
kings
court
only
dealt
with
major
issues
and
the
common
law
courts
dealt
with
more
mundane
issues.
It
did
not
however
strip
the
king
of
all
judicial
authority,
he
retained
an
overriding
residual
authority
to
administer
law
outside
the
common
law
courts
(he
had
final
say
to
override
decisions).
It
was
however,
only
invoked
when
the
common
law
courts
were
unable
to
uphold
justice.
The
king
was
approached
for
equity.
There
were
too
many
cases
so
he
appointed
the
chancellor
to
deal
with
these
cases.
Eventually
it
was
too
much
for
the
chancellor,
so
a
new
court
emerged.
It
was
called
the
Court
of
Chancery
or
the
Court
of
Equity.
Equity
principles
overruled
common
law
principles,
because
equity
13
of
155
principles
evolved
of
lack
of
common
law
principles.
This
is
because
these
laws
are
at
a
higher
level
and
stem
from
the
Kings
ability
to
override
common
law.
Cases
could
take
up
to
60
or
70
years.
In
1865,
in
response
to
Charles
Dickens
negative
commentary
on
court
systems,
Blique
House,
they
created
the
Judicature
Act:
a
piece
of
legislature
which
combined
the
common
law
and
the
equity
law
into
one
system
of
law,
which
we
still
have
today.
Both
bodies
of
principles
remained
separate,
however,
both
are
considered
during
court
cases,
where
equity
law
still
upholds
common
law.
This
was
applied
to
Canada
and
Manitoba.
Courts
have
appointed
judges
who
need
a
law
degree,
practicing
for
about
10+
years.
This
means
they
are
chosen
from
a
narrow
group.
This
is
a
more
reactive
process,
by
means
of
waiting
for
a
case
to
occur.
2. LEGISLATURES
The legislatures produce laws known as statutes or acts. Create statute law
They
are
proactive:
unlike
the
courts,
they
do
not
need
to
wait
for
a
dispute
to
arise
in
order
to
create
a
law
/
precedence.
Legislature
can
deal
with
things
outside
the
context
of
what
the
courts
are
limited
to.
The
court
system
is
considered
reactive
Legislation
is
the
predominant
instrument
to
create
law
in
the
20th
century.
It
was
utilized
seldom
prior
to
the
20th
century
for
3
reasons:
o Courts
did
the
job
adequately,
people
were
content
with
their
small
narrow
view
and
did
not
think
about
broader
social
concepts
and
proactive
views
o The government didnt have as big a role, the church had the majority of roles
o The
process
is
difficult,
it
requires
through
knowledge
of
a
particular
situation
which
needs
to
be
remedied
and
the
ability
to
devise
a
practical
means
to
implement
it
11 legislatures in Canada.
Halsbury
defines
it
as:
a
statute
or
act
of
parliament
has
been
defined
in
the
English
law
as
a
pronouncement
by
the
sovereign
in
parliament.
That
is
to
say
made
by
the
Queen
(monarch)
by
and
with
the
advice
and
consent
of
both
Houses
of
Parliament,
or
in
certain
circumstances
the
House
of
Commons
alone,
the
effect
of
which
is
either
to
declare
law
or
change
the
law,
normally
for
14
of
155
the
future
only,
but
sometimes
with
retrospective
effect.
A
statue
is
a
new
set
of
rules
which
has
ultimately
been
passed
by
the
authority
of
the
queen,
which
creates
new
law
or
affects
the
existing
law.
A
bill
is
a
draft
of
a
statute;
it
is
not
yet
legally
operational
as
it
has
not
yet
received
the
ascent
of
parliament.
This
definition
applies
mutatis
mutandis,
which
means
with
necessary
changes
being
made,
to
statutes
of
Canadian
parliament
and
provincial
legislature.
1) In the UK:
i. Monarch Queen
ii. Upper
house
House
of
Lords:
werent
appointed,
but
is
being
changed
by
Toni
Blair.
He
is
stripping
hereditary
peers
with
appointed
life
peers
from
the
labour
force.
They
will
be
considered
designated
members
of
lords
because
they
are
not
titled.
Its
modelled
after
the
Canadian
senate.
2) In Canada
ii. Upper
house
Senate:
completely
appointed,
no
social
prestige,
no
credibility,
used
to
be
a
senator
for
life
(basically
useless,
they
will
never
turn
down
a
bill)
ii. Upper
house
doesnt
exist,
it
was
abolished
in
1873,
but
was
called
the
legislative
council
(Quebec
was
the
last
province
to
have
one)
iii. Legislative
assembly
legislative
assembly:
inhabited
by
politicians,
statutes
generally
started
in
the
elected
assembly.
15
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155
UK CDN Provincial
The
ascent
of
each
component
part
is
required
for
an
act
to
be
put
into
place
(starts
at
the
house
of
commons
and
works
its
way
up
through
the
senate
and
then
to
the
queens
representative)
American
Constitutional
Structure
is
exactly
like
the
British
Bicameral
Model
that
existed
in
1776,
but
the
king
is
now
the
President
and
is
elected
into
power.
-House of Congress
In
50s/60s
the
house
of
commons
was
a
Conservative
majority,
but
because
the
prime
minister
appoints
senate
members
when
spots
open
up,
the
senate
was
full
of
Liberal
members
from
a
former
Liberal
prime
minister.
Everything
going
through
House
of
Commons
was
conservative,
and
the
liberal
senators
blocked
everything.
Legislation
basically
stopped.
This
was
during
John
Diefenbakers
reign
as
prime
minister,
and
he
told
them
that
he
was
going
to
replace
them
all
if
they
didnt
agree
to
the
bills
passed
by
the
house
of
commons.
Reforms
were
passed
in
the
1980s
that
the
prime
minister
cannot
reform
the
senate,
and
the
senate
essentially
cannot
disagree
with
the
decisions
of
the
House
of
Commons.
3. DELEGATE BODIES
Delegate
bodies
produce
Subordinate
Legislation.
It
is
the
majority
of
what
impacts
us
on
a
day
to
day
basis.
Makes
up
the
bulk
of
the
legislation
out
there.
Defined
as:
legislation
made
by
a
person
or
body
(ex.
MPI),
other
than
the
sovereign
in
parliament
by
virtue
of
powers
conferred
either
by
statute
(delegated
legislation)
or
by
16
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155
Delegate
bodies
have
the
ability
to
create
legislation
or
laws
within
their
jurisdiction.
Ex.
MLCC,
City
of
Winnipeg,
etc.
The
influence
can
be
overestimated.
In
terms
of
volume
in
legislations
it
constitutes
by
far
the
largest
number
of
laws.
In
terms
of
effects
it
regulates,
organizes
and
directs
a
broadening
sphere
of
social
conduct
by
the
specific
implementation
of
the
general
legislative
policies
embodied
in
enabling
statues.
Very
powerful
and
dominant.
Cabinet
has
this
power
often.
There
are
thousands
of
bodies
for
example,
school
boards,
municipalities,
police
depts,
fire
depts,
crown
corps,
CRTC,
etc.
Statutes
give
them
power
and
are
very
brief,
the
regulation
is
very
in-depth.
Frequently
the
recipient
of
power
is
the
cabinet.
The
problem
with
this
is
that
the
cabinet
has
so
much
power
now,
the
legislature
has
none
left.
Executive
Dominance:
delegation
to
cabinet
of
subordinate
legislation.
Canadas
system
has
the
worst
aspect
of
the
US
and
UK
systems.
Subordinate
legislation
has
various
names:
regulation,
orders,
rules,
bylaws
or
ordinances
(created
by
delegate
bodies).
Subordinate
does
not
mean
that
they
have
any
less
power,
it
only
means
it
was
been
delegated
by
the
legislation.
They have a quasi-judicial role: they need to resolve disputes, hear grievances, produce regulations
1.
Delegate
bodies
can
only
create
legislation
within
the
jurisdiction
given
by
statutes.
Anything
else
is
ultra
vires
(beyond
the
power/jurisdiction)
is
void
(has
no
force
or
effect).
Intra
vires
means
within
the
power,
the
jurisdiction.
2.
Delegates
cant
delegate
delagatus
non
potest
delagare
cant
further
delegate
their
power.
For
example,
in
estate
law
you
appoint
an
executor,
they
cant
delegate
their
powers,
unless
legislation
allows
them,
they
have
to
attend
to
them
personally.
Until
the
20th
century,
the
most
significant
institution
creating
law
was
the
courts
(Judge(s)).
Judge
can
only
create
laws
when
a
dispute
arises.
Law
creation
by
Judges
are
reactive,
and
not
proactive.
17
of
155
In
the
early
20th
century,
the
delegate
bodies
exploded
and
the
relative
roles
of
significance
reversed.
Legislatures
act
proactively,
not
having
restricting
of
the
Courts.
1. In order for courts to make law they must wait for an appropriate dispute to arise.
o The other is proactive; they can make law, giving the advantage to the legislature.
2. Court
resolution
worked
quite
well
because
there
wasn't
an
enormous
necessity
for
it
and
there
weren't
too
many
laws
needed
at
the
time.
Suddenly
with
the
industrial
revolution
there
was
a
big
change
in
society.
The
legislature,
because
they
were
proactive,
they
could
immediately
act
to
the
problems
of
the
industrial
society,
however,
the
courts,
because
they
were
conservative,
couldnt/didnt
react
lost
their
dominant
position.
3. Society
finally
had
sufficient
wealth
to
support
an
ongoing
legislature
function.
Ironically,
it
was
the
industrial
revolution
that
fuelled
the
wealth
and
allowed
for
the
problems
to
occur.
It
required
more
legislation
and
aided
it
come
about.
The
industrial
revolution
provided
both
the
wealth
and
problems.
SYSTEMS OF LAW
The
essence
of
a
system
is
the
rationale
and/or
principle
according
to
which
various
related
matters
are
arranged.
When
we
speak
of
legal
systems
in
contradistinction
from
one
another,
we
mean
to
differentiate
that
rationale
or
principle
around
which
laws
and
legal
decisions
are
ordered.
Principles of law need to be applied by judges use to adjudicate cases not including legislation
The genesis and organization of the principles the Judges utilize to adjudicate cases.
Civil law and common law are the two systems / principles used by judges to adjudicate
i) Civil Law
1. CIVIL LAW
Europe: everywhere but England, Whales and Ireland, where they have the common law system.
Louisiana, in the US, because it was colonized by the French and Spanish.
Canada
we
have
basically
the
common
law
system
except
for
Quebec,
because
they
were
colonized
by
the
French.
Even
though
Quebec
was
conquered
by
England
in
1759
in
the
battle
of
the
planes
of
Abraham
(General
Wolf
for
the
English,
General
Montcalm
for
the
French.)
It
became
part
of
the
British
Empire
in
the
treaty
of
Paris
in
1763.
(English
had
choice
from
Guatalu)
However
in
1774
the
Quebec
act
allowed
for
the
continuation
of
the
Quebec
system
(civil
code).
Regarded
by
one
of
the
intolerable
acts
for
the
Americans.
The
British
allowed
the
civil
law
system
to
continue.
Everything is so nicely articulated, instead of trying to figure out the principles yourself.
The
essence
of
the
civil
law
system
is
the
existence
of
the
code.
19
of
155
The
modern
system
owes
it
genesis
to
the
Roman/Byzantine
Empire,
in
particular
the
empire
of
Justinian
in
the
6th
century
AD.
The
Roman
Empire
divided
into
two
empires
holy
Roman
and
byzantine.
Justinian
wanted
one
set
of
codes
to
be
used
throughout
the
empire.
According
to
Blacks
legal
dictionary
codification
means:
the
process
of
collecting
and
arranging
the
laws
of
a
country
or
state
into
a
code,
that
is
into
a
complete
system
of
positive
law;
scientifically
ordered
and
promulgated
(endorsed
/
put
forward)
by
a
legislative
authority.
It
became
known
as
Justinians
code.
The
creation
of
code,
and
the
utilization
of
the
code
for
the
adjudication
of
cases.
Formed the basis for most of Europes legal system other than England
The
process
of
codification
does
not
include
amending
law
/
changing
or
creating
new,
it
is
just
collecting
it
together
and
putting
it
into
a
form
that
is
understandable
and
usable.
It
was
replaced
in
1804,
when
Napoleon
Bonaparte
created
a
replacement
code.
Known
as
the
Napoleonic
Code
/
French
Civil
Code.
The
modern
civilian
countries
update
the
code
more
frequently.
They
have
ongoing
tribunals
that
update
the
code
on
an
ongoing
basis.
In
the
civil
law
system,
the
court
always
refers
to
a
code
to
access
a
principle
to
settle
a
dispute.
Only
if
the
code
does
not
cover
the
new
problem
is
the
court
free
to
settle
the
problem
from
the
introductory
general
principles
(in
the
front
of
the
code
book).
There
is
no
doctrine
of
precedence
in
the
civil
law
system.
Later
courts,
in
the
civilian
court,
may
decide
in
a
similar
case
that
a
just
result
is
a
reverse
to
the
original
decision.
Each
Judge
can
select
the
principles
that
they
see
fit
regarding
a
case
they
adjudicate.
This
is
regarded
as
the
critical
weakness
in
the
civil
law
system.
Its
a
deductive
system
(it
is
organized
on
the
basis
of
general
principles
applied
to
specific
situations).
WEAKNESSES:
1) There is an absence of doctrine of precedence, which removes certainty from the law.
2)
In
new
areas
of
development
where
there
arent
specific
principles;
the
application
of
the
general
principles
is
illusory.
The
rigorous
application
of
general
principles
may
prove
faulty
in
new
areas
of
law
(such
as
the
internet).
Predictability
and
certainty
are
difficult
to
achieve
in
civil
law
individual
judges
20
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155
applying
the
general
principles
may
come
to
different
results
in
the
same
specific
situation
(result
is
unpredictable
/
uncertain).
1)
There
are
frequent
revisions
to
the
code,
so
in
newly
developing
areas
of
the
law
there
are
up
to
date
principles.
These
revisions
are
usually
based
on
decided
cases.
2)
There
is
a
growing
tendency
by
the
courts
to
apply
precedence.
Lawyers
argue
them;
judges
read
them,
with
the
result
that
nevertheless
precedents
are
applied
with
upon
commitment
greater
certainty
and
predictability.
Judges
are
influenced
by
the
decisions
of
previous
judges
/
courts
but
are
not
required
to
adhere
to
previous
decisions
in
similar
situations.
2. COMMON LAW
Common
law
system:
applies
to
court
created
law,
how
they
are
applied.
It
applies
to
certain
statutory
laws
as
well.
Statutes: the pieces of legislation passed by the government that we must abide by
o Create
some
sort
of
body
that
supervises
or
makes
sure
that
the
law
is
abided
to
(delegate
bodies
like
the
CRTC
for
example)
It
originated
in
England,
Wales
and
Ireland
and
current
former
British
colonies.
The
English
in
the
middle
ages
had
to
device
a
different
system
to
solve
disputes
because
England
essentially
was
cut
off
from
Europe,
because
its
an
island.
Consequently
it
wasnt
influenced
by
the
factors
that
influence
mainland
Europe.
The
problem
was
that
the
judges
in
the
Anglo-Saxons
courts
had
to
solve
disputes,
but
where
did
the
principles
come
from?
Some
came
from
the
church,
the
king.
However
they
said
it
had
come
from
time
and
memorial
and
then
theyd
make
it
up.
There
was
an
oral
history
but
not
many
people
could
read
at
the
time.
Why
did
they
do
that?
Because
it
gave
them
a
level
of
legitimacy.
They
spoke
of
precedent
cases.
When
mercantilism
became
prominent,
it
demanded
more
certainty
and
assurance
and
the
doctrine
of
precedence
was
begun
to
be
21
of
155
recorded
(predictability,
consistency
and
certainty).
Eventually
it
was
based
on
precedence
that
was
organized
and
it
became
preferable
over
the
civil
law
system.
Eventually
built
up
a
body
of
judge-made
law.
Provided
consistency
and
predictability.
However,
if
a
judge
made
the
wrong
decision,
future
judges
would
rule
the
same
way
which
was
an
issue.
The
doctrine
of
stare
decisis
(doctrine
of
precedence
/
theory
of
presedence
translates
to
stand
by
previous
decisions)
has
been
used
for
1000
years,
but
only
in
the
19th
century
did
it
become
a
rule
of
law
that
needed
to
be
followed.
The
only
binding
principle
is
the
ratio
decidendi.
The
narrowest
and
necessary
legal
principle
upon
which
a
decision
was
based.
When
you
take
all
the
facts
in
the
case
together,
there
is
really
only
certain
bits
and
parts
that
are
pertinent
to
a
judge
making
their
decision.
It
is
the
only
part
of
a
case
which
is
legally
binding.
Obiter
Dktum,
means
by
the
way
which
refers
to
all
the
other
case
facts
outside
of
ratio
decidendi
which
are
not
pertinent
to
the
decision.
If
ever
there
is
change
required
in
the
common
law
system,
it
must
come
without
the
system
because
you
are
bound
to
abide
by
previous
decision.
A
major
failing.
2. A
system
of
publishing
precedent
cases
(law
reports),
essential
the
discussion
of
the
judges
findings
and
discussion
of
law.
3. Wide
spread
distribution
of
these
printings.
started
in
the
Tutor
period
(1485
1650)
with
Henry
VIII.
During
this
era,
the
doctrine
of
precedence
started
to
work
in
an
effective
way.
From
the
myth
came
a
fully
functioning
legal
system.
The
creator
of
the
law
is
the
precedence
where
as
in
civil
law
the
creators
are
the
courts/judges.
1. Summary of facts
2. Discussion
of
law
22
of
155
3. Resolution of case
1) Definitional or Substantial:
The
principle
of
law
is
found
in
the
precedence
called
the
ratio
decidendi:
the
narrowest
and
necessary
legal
principle
upon
which
a
legal
decision
was
based.
The
binding
aspect
of
the
case
is
the
ratio
decidendi.
It
is
up
to
the
reader
to
determine
what
the
ratio
is.
Always
therefore
subject
to
argument
and
debate
until
the
court
tells
us
what
the
ratio
is
in
another
case.
In
the
civil
law
system
is
clearly
articulates
what
the
precise
principle
is,
so
there
isnt
the
certainty
that
some
commentators
make
about
the
common
law
system.
It
also
allows
flexibility
for
some
judges
that
arent
as
well
informed
but
it
undermines
the
certainty
that
the
doctrine
of
precedence
should
contain.
Obiter
dictum:
statements
by
the
way.
2) Structural:
The
answer
was
provided
by
Rupert
Cross,
he
wrote
a
book
called
precedence
in
legal
law
and
described
the
structural
component
of
the
stare
decisis
as:
every
court
is
bound
to
follow
any
case
decided
by
a
court
above
it
in
the
hierarchy
of
courts
and
appellate
courts
are
bound
by
their
own
decisions
save
(except
the
court
of
Canada
and
the
house
of
lords).
However,
this
statement
is
too
concise;
the
only
part
of
the
case
that
is
binding
is
the
ratio
decidendi.
Order:
trial
court,
appellate
court,
appeals
court,
final
Manitoba:
trial
courts
Manitoba
court
of
appeal
supreme
court
of
Canada.
No
other
courts
outside
this
hierarchy
are
binding,
they
may
be
persuasive
however.
The
Manitoba
courts
do
not
have
to
follow
decisions
made
in
Ontario
because
its
not
in
our
jurisdiction.
We
do
not
also
have
to
follow
decisions
made
by
The
Hague
(world
courts)
in
Holland.
23
of
155
Hierarchy of Jurisdiction:
1) Provincial
courts
narrow
jurisdiction,
ex.
Family
court,
juvenile
court,
small
claims
court
(up
to
7,500),
traffic
court,
bylaw
court
,
all
appointed
by
provincial
government
4) Supreme
court
of
Canada-
the
final
appellate
court
for
all
jurisdictions
in
Canada.
It
serves
a
unifying
function.
If
something
comes
from
Quebec
then
its
heard
from
the
3
Quebec
judges,
however
those
judges
can
do
cases
from
the
common
law
system.
5) JCPC
(the
judicial
committee
of
the
Privy
Council)
ended
in
1949
and
still
can
be
binding
precedence
in
Canada.
Final
relevant
case
heard
in
1960.
Common
law:
The
progress
of
legal
history
is
the
slow
revelation
and
refinement
of
refutable
principles.
This
is
the
metaphysical
justification.
1) Historical:
classical
it
is
based
on
principles
metaphysically
inspired
that
have
the
appearance
of
change
because
they
are
being
applied
to
modern
cases.
It
is
only
the
application
of
old
principles
to
new
circumstances
that
give
the
appearance
of
change.
They
do
not
make
law
but
declare
what
it
is.
Change
comes
from
the
legislature.
2) Modern:
best
annunciate
by
Samuel
Freedmon
who
was
one
of
Manitobas
two
best
judges
(Brian
Dickson).
Freedmon
wrote
many
articles
on
the
doctrine
of
stare
decisis.
Freedmon
said,
Those
wedded
to
the
rigorous
application
of
the
doctrine
of
stare
decisis
insist
that
it
produces
the
3
Cs:
certainty,
consistency,
and
continuity.
a. Certainty: we must know what the law is. (very important in commerce / business)
b. Consistency:
equality
of
treatment
should
be
sought
with
similar
cases
being
treated
similarly
24
of
155
c. Continuity:
we
must
avoid
the
disastrous
inconvenience
of
introducing
doubt
into
the
law
through
judicial
departures
from
precedent.
Linked
to
this
is
the
reliance
principle:
that
is
the
principle
that
people
order
their
affairs
in
reliance
on
judicial
decisions
(principles
declared
by
judges)
and
therefore
their
interest
should
be
adversely
affected
if
judges
altered
principles.
People
order
their
affairs
on
the
basis
of
these
decisions
therefore
interests
would
be
adversely
affected
if
judges
departed
from
decisions.
1)
Because
you
follow
pre-existing
decisions,
if
one
of
these
courts
make
an
error
and
makes
a
bad
principle,
it
will
persist
for
a
long
time.
(However
there
are
now
mechanisms
in
place
to
prevent
this.
Judges
making
a
poor
decision
in
a
lower
level
of
court
can
be
appealed
in
a
higher
level
of
court).
2)
The
principles
or
ratios
themselves
in
the
common
law
system
arent
that
clear,
they
are
interpreted
and
interpolated.
Very
seldom
are
those
ratios
clarified,
which
creates
a
level
of
uncertainty
which
the
civil
law
system
doesnt
have.
Historically
the
doctrine
of
stare
decisis
operated
on
a
rule
of
custom.
It
was
not
till
the
19th
century
that
the
House
of
Lords
accepted
the
doctrine
of
stare
decisis
and
proclaimed
it
law.
The
reason
why
it
was
accepted
was
complex:
1) industrial revolution - requiring certainty, people dealing with commercial contracts, more wealth.
3)
commercial
printing
(printing
press)
had
become
even
more
developed
and
greater
distribution
systems
were
available.
Allowed
for
effective
case
reporting
and
distribution.
Convergence of systems:
Interestingly,
the
civil
law
system
and
common
law
systems
are
growing
in
similarity.
Youll
find
the
law
almost
the
same
within
Canada
and
Quebec
systems.
There
is
a
convergence
of
reality,
because
there
is
similar
pressure
on
the
two
systems.
Common law looks more like civil law systems and vice versa.
In
the
common
law
system
we
simultaneously
find
a
greater
use
of
codes,
for
example
the
criminal
code,
human
rights
code,
fire
code,
the
partnership
act,
the
sale
of
goods
act.
We
have
also
seen
that
the
final
appellate
courts
are
not
bound
by
their
precedent;
the
courts
have
the
ability
to
distinguish
cases
on
their
facts
gives
the
courts
more
freedom.
Courts
are
an
institution
of
dispute
resolution.
Their
unique
feature
is
that
they
make
law
simultaneously.
There
are
other
institutions
that
make
law
and
resolve
disputes:
arbitration,
mediation,
reconciliation,
settlement.
1.
Arbitrator
of
the
constitution:
Federal
parliament
and
provincial
legislatures
are
the
two
levels.
These
two
levels
were
created
in
1867
by
the
British
North
American
Act
changed
to
the
Constitution
Act
of
1867.
Federal
parliamentary
powers
are
GST,
military,
post
office,
currency,
national
defence,
weights
&
measures,
trade
&
commerce,
penitentiaries
Provincial legislatures controls health care, education, taverns, highways and liquor.
The
act
that
sets
out
the
jurisdictions
was
made
in
1867,
but
there
are
going
to
be
disputes
over
jurisdiction
over
things
that
they
didnt
have
back
then
(think:
technology).
The
courts
have
ultimately
taking
over
arbitrating
these
disputes.
They
have
assumed
it
and
both
parties
have
respected
it.
1971
case
Attorney
General
of
Manitoba
and
Attorney
General
of
Canada
vs
Air
Canada.
There
was
a
joke
that
MB
was
a
place
you
flew
over
on
your
way
to
somewhere
important.
AG
of
MB
said
that
the
liquor
tax
should
be
collected
for
all
the
drinks
sold
while
planes
were
flying
over
Manitoba.
Supreme
court
ruled
that
the
drinks
were
being
poured
in
federal
airspace.
2. Interpreter of legislation:
Often
a
dispute
that
goes
to
court
revolves
around
the
meaning
of
a
statute
or
piece
of
legislation
26
of
155
Ex.
You
get
caught
with
drugs
in
your
car
and
claim
you
didnt
know
they
were
there.
You
have
been
charged
with
possession.
The
criminal
code
does
not
define
possession
so
it
is
up
to
judges
to
determine
the
meaning
of
it.
When they are interpreting the meaning of legislation judges have 2 approaches:
2. mischief/liberal
approach
purposive,
they
look
at
the
object
of
the
statutes
in
the
context
it
was
created
judges
look
at
context
to
give
meaning
for
disputed
terms
o golden
rule
use
plain
approach
unless
it
leads
to
some
absurdity,
in
which
case
then
use
the
liberal
approach
3.
Protector
of
civil
liberties:
(traditionally
refers
to
the
freedom
of
the
individual
in
politics
and
religion.)
The
courts
assume
the
role
of
protecting
civil
liberties,
and
have
changed
over
time.
In
1960
during
Diefenbaker
government,
the
Bill
of
Rights
was
passed
in
statutory
form
by
the
government
of
Canada,
encapsulated
in
statutory
form
both
rights
and
freedoms
and
the
need
for
their
protection.
However
importantly
it
was
not
entrenched,
the
courts
didnt
have
the
final
decision
making
power.
In
1982
their
dreams
came
true
when
the
Trudeau
government
gave
the
charter
of
rights.
It
is
entrenched
which
gives
ultimately
the
supreme
court
of
Canada
final
decision
making
power
as
well
as
the
power
to
give
those
terms
meaning.
Protects
private
people
over
government
and
27
of
155
parties.
Charter
of
rights
became
operative
in
1985.
It
is
entrenched,
which
means
it
cannot
be
appealed
by
an
ordinary
act
of
parliament
or
provincial
legislatures.
Charter is being interpreted by the courts and then they apply it to see if a certain statute violates it
4.
Arbitrator
of
disputes
between
private
persons:
all
about
private
law,
people
go
to
court
to
have
their
disputes
resolved
in
a
trial.
In
common
law
this
is
how
new
precedents
are
created.
This
gave
rise
to
contract
law,
tort
law,
family
law
etc
5.
Arbitrator
of
public
law
disputes:
between
two
government
agencies
or
a
person
and
the
government.
Include
criminal
law,
constitutional
law
and
administrative
law.
ADVERSARY SYSTEM:
It
means:
In
civil
disputes
it
is
generally
up
to
the
parties,
not
the
court,
to
initiate
and
prosecute
litigation,
to
investigate
the
pertinent
facts
and
to
present
proof
and
legal
argument
to
the
decision-making
tribunal.
It
is
about
enlightened
self-interest
(selfishness)
and
fits
with
the
capitalist
approach.
The
courts
function
in
general
is
limited
to
adjudicating
the
issues
submitted
to
it
by
the
parties
or
the
proof
presented
by
them
and
to
apply
appropriate
procedural
sanctions
upon
the
motion
of
a
party.
The
basic
concept
is
that
presentation
and
prosecution
should
be
done
by
the
party
with
the
court
acting
a
passive
arbitrator.
Fight
theory:
boxing
match
is
analogous
to
the
adversary
system.
Two
fighters
and
a
referee
who
is
not
involved
in
the
fighting.
2 assumptions:
1) The
factual
truth
and
appropriate
legal
principal
is
more
likely
to
emerge
from
bilateral
investigation
and
presentation
motivated
by
self-interest
then
from
judicial
investigation
motivated
only
by
official
duty.
In
other
words,
if
you
have
something
at
stake
and
are
self-
interested,
it
will
compel
you
better
to
do
a
better
job,
investigate
better
and
work
harder.
In
some
cases,
the
prosecutor
is
the
judge
and
therefore
there
is
an
inherent
bias.
Example,
OJ
Simpson
28
of
155
case,
said
there
was
a
rush
to
judgement
that
they
didnt
investigate
other
alternatives.
There
is
an
element
in
the
adversary
system
of
individualism
much
like
capitalism.
Capitalism
is
the
use
of
self-interest
to
generate
wealth.
Most
capitalism
systems
have
adversary
system.
The
more
extreme
the
capitalism
system,
the
more
extreme
the
adversary
system
seems
to
be.
2) The
moral
force,
legitimacy,
and
acceptability
of
a
decision
will
be
greatest
when
it
is
made
by
one
who
does
not
have
and
does
not
appear
to
have
the
kind
of
psychological
commitment
to
the
result
that
is
implied
in
initiating
and
conducting
a
case.
It
is
a
more
acceptable
decision
when
there
is
party
(the
judge)
who
is
not
involved
in
the
investigation
and
adjudicates
a
decision.
There
is
also
a
belief
that
there
will
be
a
better,
fairer
decision
resulting
when
you
are
actively
involved
in
the
process.
Legitimacy
means
that
we
have
the
day
in
court
to
argue
our
case
and
even
though
the
result
isnt
what
we
want,
you
were
able
to
represent
yourself.
3)
Self-interests
can
create
abuses
of
procedures.
In
96/97
the
OJ
Simpson
case
was
thought
to
be
unfair
because
OJ
had
lots
of
money.
(However
it
was
really
that
he
had
only
8
million
dollars
and
the
LA
County
invested
60
million
dollars.)
In
every
case
there
is
an
unequal
means
issue.
Jerome
Frank:
one
hires
George
Forman
and
the
other
person
gets
Peewee
Herman.
In
Canada
we
dont
have
a
pure
adversary
system,
lawyers
are
court
officers
and
have
duties
to
the
court
not
to
lie.
For
example,
the
lawyer
wont
do
the
case
if
he
knows
the
client
did
it
and
is
going
to
lie.
Secondly
judges
will
move
the
case
along.
They
are
involved
in
the
court
process.
This
seems
to
make
up
for
the
deficiencies
in
the
adversary
system.
Court system is organized according to the Constitution Act 1867 (formerly BNA Act of 1867).
The
provinces
(provincial
legislatures)
under
section
92
have
jurisdiction
over
the
administration
of
justice
including
the
organization
and
operation
of
police
forces
and
the
system
of
courts.
29
of
155
Federal
government
under
section
96
has
the
exclusive
right
to
appoint
judges
and
pay
superior
court
judges
and
above.
1. Courts
of
1st
instance
(trial
courts)
Courts
that
hear
evidence,
where
witnesses
appear.
Divided
into:
A. Provincial
court
(ex.
traffic
court,
small
claims
court
[up
to
10,000],
youth
court,
bylaw
court,
provincial
judges
court)
established
by
provincial
legislature
(judges
appointed
by
the
province)
B. Court
of
Queens
bench
as
the
superior
court
it
has
plenary
jurisdiction
over
trial
(judged
appointed
by
feds).
The
person
that
brings
the
lawsuit
is
called
the
plaintiff
and
the
defending
person
is
the
defendant.
This
is
where
matters
are
first
heard
and
an
attempt
is
made
to
resolve
the
dispute.
If
you
are
not
happy
with
the
decision
you
have
an
automatic
appeal.
2. Court
of
appeal
-
the
individual
who
is
appealing
the
case
is
called
the
appellant
and
the
person
defending
the
appeal
is
called
the
respondent.
Anyone
can
appeal.
Here
you
dont
hear
evidence,
only
principles
of
law.
If
you
are
still
dissatisfied
you
then
must
be
granted
appeal
to
the-
3. Supreme
Court
of
Canada,
It
was
created
in
1875
pursuant
to
the
provision
in
the
constitution.
It
didnt
however
become
the
final
appellate
court
until
1949.
Until
then
the
JCPC
was
the
final
appellate
court,
could
appeal
directly.
Tribunal
in
the
UK,
all
members
were
judges,
one
report
and
could
easily
find
ratio.
It
is
a
leave
court
you
need
special
approval
and
application
to
appeal
your
case
to
this
level.
4. JCPC
used
to
exist,
you
could
skip
Supreme
Court
of
Canada
and
appeal
to
this
level.
It
was
a
tribunal,
the
members
were
judges.
They
gave
a
committee
report,
not
a
judgement.
It
was
ten
pages
long
which
allowed
you
to
find
the
ratio
decidendi
more
easily.
o Supreme Court
Generally the judges appointed will think the same way as the prime minister
In
the
1981
reference
case
this
was
most
apparent
when
the
prime
minister
voted
his
friends
in.
On
the
court
there
were
9
judges,
7
appointed
by
Trudeau
and
2
left
from
Diefenbaker.
The
result
was
a
7
to
2
split.
Canada
is
a
federal
country
so
the
prime
minister
appoints
people
to
hear
disputes
between
the
federal
legislature
and
provincial
legislatures
cases.
Another
court
structure
called
the
federal
court
created
pursuant
to
the
federal
court
act
and
replaces
the
exchequer
court,
which
means
the
tax
court,
in
1970.
However
the
jurisdiction
was
expanded
beyond
tax
to
trademarks,
patents,
copyrights,
and
.
The
problem
is
that
it
creates
a
lot
of
chaos
because
you
dont
know
what
to
sue
and
sued
in
the
wrong
court.
There
are
3
divisions:
federal
court
of
trial
division,
federal
court
of
appellate
division,
Supreme
Court
of
Canada.
Statutes
of
Limitation:
people
may
appeal
the
decisions
made
up
to
2
years
for
torts
and
6
years
for
contract
matters.
Because
of
the
effect
of
evidence
eroding,
decisions
can
change.
All
legal
persons
may
sue,
even
corporations.
If
you
are
incompetent
or
under
18
then
your
guarding
can
sue.
2) Must have standing: if you have a special interest to be vindicated (prevents frivolous claims.)
3)
Class
action:
one
individual
represents
a
group
or
class
of
individuals
with
the
same
issues
and
dispose
of
the
matters
for
all,
this
helps
stop
clogging
of
the
courts.
Now
we
have
the
Class
Proceedings
Act
which
allows
for
a
common
interest,
not
an
exactly
same
interest,
which
makes
it
easier
for
class
action
lawsuits
31
of
155
to
occur.
Ex)
Ralph
Nader
vs
the
automotive
industry.
Ex.
Defective
vehicles
instead
of
having
thousands
of
lawsuits,
one
individual
represents
the
class.
Over
90%
of
cases
that
are
started
are
settled.
Procedural
law:
how
to
engage
the
law
and
how
to
move
it
along
to
achieve
the
remedy
in
respect
to
substantive
law
(dealing
with
liability).
Purpose
of
the
court
process
is
to
discourage
a
case
from
going
to
trial
and
to
settle
it
before
the
court.
There
are
numerous
mechanisms
in
place
to
promote
settlement
and
avoid
taking
the
matter
to
court
because
it
is
an
incredibly
expensive
system.
Plaintiff
issues
a
statement
of
claims
it
is
served
to
the
defendant
to
notify
them,
describe
the
wrong-doings,
the
remedy
sought.
Has
to
be
served
within
6
months.
The
statement
of
claims
is
a
factual
rendition
of
the
lawsuit
and
the
remedy
sought.
The
facts
have
to
allege
the
lawsuit.
Includes
the
name
of
the
plaintiff
and
the
identity,
the
defendants
name
and
the
identity,
all
the
material
fact
you
rely
upon
(must
be
fact).
There
are
service
rules
contained
in
the
Queens
Bench
rules,
normally
there
is
a
bailiff
to
serve
the
document
and
sign
it.
If
person
avoids
service
you
can
get
an
order
of
substitutional
service
for
real
delivery
of
service
and
the
court
will
tell
you
what
to
do:
place
ads
in
the
newspaper
or
mail
to
the
last
address.
If the defendant does not file this within 20 days then the plaintiff automatically wins.
If
the
statement
of
claim
is
not
clear
then
they
can
ask
for
better
particulars
through
a
formal
or
informal
process.
Case
management
see
a
judge
in
chambers
and
the
judge
organizes
the
next
step
to
promote
settlement,
applies
to
all
family
matters
and
civil
matters
under
$50,000
then
the
judge
asks
if
you
want
the
case
to
be
mediated
by
the
judge,
otherwise
the
judge
will
set
up
the
next
step.
3.
Case
conference
32
of
155
A judge who will not hear the case meets with the parties in their chambers to discuss the case.
Purpose
is
to
attempt
to
achieve
a
settlement
and
offers
different
ways
for
the
parties
to
have
their
matter
solved
in
an
attempt
to
avoid
the
court
system.
The
lawyers
submit
briefs
on
the
matter
and
the
judge
then
in
advance
gives
you
an
idea
of
what
will
happen
in
order
to
try
and
achieve
settlement.
4. Documentary Discovery
Each
side
gets
to
ask
the
other
side
relevant
questions,
so
both
sides
have
the
opportunity
to
have
all
the
information
of
the
case.
You
are
also
told
who
all
the
witnesses
are
that
will
be
used.
You are more likely to achieve settlement if you know all the facts, which is the goal.
There
is
a
court
reporter
attend,
both
sides
attend
and
the
information
is
read
into
evidence.
Achieves
several
purposes,
get
a
basis
for
cross
examination,
get
to
test
the
medal
of
the
opposite
side,
see
if
they
are
credible,
and
institute
the
evidence.
Also
teaches
the
litigant
what
it
is
like
to
be
involved
in
the
law
process.
6. Pre-trial conference
A judge who will not hear the case meets with the parties in their chambers to discuss the case.
Purpose
is
to
attempt
to
achieve
a
settlement
and
offers
different
ways
for
the
parties
to
have
their
matter
solved
in
an
attempt
to
avoid
the
court
system.
The
lawyers
submit
briefs
on
the
matter
and
the
judge
then
in
advance
gives
you
an
idea
of
what
will
happen
in
order
to
try
and
achieve
settlement.
Gives
the
litigants
an
idea
of
whether
or
not
you
have
a
strong
case,
and
an
idea
of
how
the
judge
perceives
the
case.
If the pre-trial conference fails then the judge will set a trial date.
7.
Trial
33
of
155
The
plaintiff
puts
in
their
case
first
on
the
balance
of
probabilities,
then
the
defendant
puts
in
their
case
and
tries
to
establish
sufficient
doubt
and
there
is
cross
examination.
Trials
can
take
days,
weeks,
months
and
the
whole
process
can
take
years
(8
10
years
is
not
uncommon).
LAWSUIT EXPENSES
Lawsuits are expensive in many ways: financial costs and emotional costs.
The
courts
in
Canada
award
costs
to
the
winner,
because
the
winner
shouldnt
have
to
have
gone
to
court
to
settle.
It is rather a portion of the costs; they have a chart that says what each service actually costs.
Party-to-party
costs
are
a
contribution
to
their
legal
costs
out
of
pocket
(25-30%
usually)
by
the
losing
party.
If
it
is
frivolous,
the
losing
party
may
be
held
100%
responsible
for
the
costs
of
the
winning
party.
It
serves
to
dissuade
frivolous
litigation
and
promote
quick
settlement.
1. hourly
rate,
which
can
range
between
175
and
500
an
hour,
(it
doesnt
really
dictate
quality
though),
used
most
frequently
to
pay
lawyers.
2. contingency
agreement,
paying
the
lawyer
on
the
basis
of
the
percentage
of
the
money
obtained
through
the
settlement.
Normally
its
between
25%
and
40%
depending
on
what
stage
the
settlement
takes
place.
However,
you
must
pay
the
disbursements
on
a
normal
basis.
Tend
to
be
a
fairly
hefty
proportion,
because
you
are
overpaying
the
lawyer
because
there
is
a
risk
for
the
lawyer
of
not
receiving
any
money
if
they
lose.
In
Canada,
lawyers
are
known
as
barristers
(those
who
go
to
court)
and
solicitors
(those
who
do
not
go
to
court).
In
England
there
is
a
split
bar,
and
therefore
are
essentially
two
different
professions,
youre
either
one
or
another.
Barristers
go
to
court
and
solicitors
do
everything
else
including
hiring
your
clients.
Therefore
there
is
a
split
bar
in
England.
There
is
a
good
reason
for
it
because
very
few
people
can
effectively
do
both.
34
of
155
Damage
awards
are
larger
in
the
USA.
They
are
awarded
by
the
jury
in
the
US,
instead
of
judges
in
Canada.
We
have
a
low
cap
on
pain
and
suffering
awards
in
Canada,
but
the
USA
does
not.
Contingency
is
much
larger
in
the
USA
than
in
Canada
because
of
the
larger
damage
awards.
It creates the organs, institutions of the country that both create law and administer law.
1. First
provide
for
the
creation
of
the
basic
organs
and
institutions
of
public
authority.
Constitution
must
create
the
institutions
that
create
the
law
and
enforce
the
law.
2. Second,
it
must
define
the
powers
possessed
by
each
of
the
public
institutions
and
in
some
respects
define
the
relationships
between
these
various
institutions.
3. Third,
a
constitution
must
provide
for
the
processes
by
which
law
is
created,
and
at
the
same
time
provide
for
the
limitations
on
the
power
(called
Constitutionalism;
the
assumption
that
freedom
exists
unless
the
act
is
specifically
prohibited
limited
government.)
exercised
by
the
officials
of
public
institutions.
Thus
a
constitution
assigns
legal
responsibility,
defines
the
limits
of
authority,
and
establishes
the
processes
which
must
be
followed
before
this
authority
can
be
exercised.
4. Furthermore,
a
constitutional
document
must
provide
for
a
method
of
change,
both
of
political
leadership
(1)
and
of
the
basic
constitutional
framework
(2),
the
latter
by
way
of
amendment
to
the
constitution.
Laws
make
up
part
of
the
constitution
but
they
reflect
political
values
and
in
turn
define
the
political
process.
o Says
that
the
Queen
and
then
the
governor
general
have
the
executive
power
and
sometimes
the
Privy
Council
(created
to
assist
the
monarch
in
use
of
executive
authority,
but
they
have
never
met).
o However,
the
prime
minister
has
the
real
executive
power
and
yet
he
isnt
mentioned
in
the
constitutional
document.
Its
a
convention
that
the
monarch
follows
the
decisions
of
the
prime
minister.
A
constitutional
lawyer,
DesSmith
provides
a
precise
definition:
constitutions
are
primarily
about
the
political
power,
the
location,
the
conferment,
the
distribution,
exercise
and
limitation
of
power
among
the
organs
of
the
state.
the
principle
of
constitutionalism,
about
having
restraints
on
the
governors,
it
is
the
assumption
of
freedom
unless
an
act
is
specifically
prohibited.
Constitutionalism:
legitimate
actors
in
the
political
system
have
only
such
authority
as
is
vested
in
them
by
law
and
that
any
attempt
to
move
beyond
the
peripheries
of
these
authorities
is
illegal
or
ultra
vires:
beyond
the
power,
and
therefore
void.
Case of DuPlessis: no official has any authority to act unless empowered by statute.
Definitions:
i)Authoritative
sources:
create
constitutional
rules
which
are
law
because
they
are
enforceable
in
the
courts.
ii)Persuasive
sources:
create
rules
of
the
constitution
which
are
not
a
part
of
the
constitution.
Meaning,
the
courts
wont
enforce
them
because
they
are
not
law.
iii)Entrenchment:
page
71
of
Cheffins:
by
entrenchment
we
mean
there
are
certain
provisions
in
the
constitution
which
are
beyond
the
normal
control
of
either
the
federal
parliament
or
the
provincial
legislatures.
That
is
to
say,
certain
provisions
of
the
constitution
are
regarded
as
so
significant
and
so
important
that
they
can
only
be
changed
by
an
extraordinary
process.
Prior
to
1982
that
extraordinary
process
included
the
agreement
by
the
UK
parliament,
after
1982
you
must
resort
to
one
of
2
amending
formulae.
Its
a
resort
to
a
different
process.
Since
1982
nothing
has
changed,
because
it
is
so
difficult
of
a
process
that
they
cant
pass
anything.
vi)Patriated: amendment process for entrenched parts of constitution are wholly domestic.
1. BNA
Act
1867:
created
Canada
(the
statutes
united
these
colonies
into
a
country),
it
laid
out
the
framework
of
our
constitution:
courts
created,
supreme
court
created.
2. The
constitution
act
1982:
the
charter
of
rights
were
created
as
well
as
it
allowed
for
a
domestic
amending
process
(patriating).
b. Canadian parliament:
some is entrenched:
1. election act,
c. Provincial legislatures:
all
of
them
have
created
constitutional
law,
section
92(1)
of
BNA
act
1867
and
section
45
of
the
Constitution
act
1982
-
provides
the
legislature
of
each
provinces
to
make
laws
of
the
constitution
laws
of
the
province.
Each
province
has
the
ability
to
make
constitutional
law,
none
of
it
is
entrenched
except
the
office
of
the
lieutenant
governor
in
section
45
of
the
Constitution
act
1982.
38
of
155
To
change
any
offices
requires
unanimous
provincial
consent
and
the
consent
of
the
federal
parliament.
The
provinces
are
active
in
changing
their
constitutions.
Prior
to
1982
they
focused
on
the
constitution
of
the
division
of
power;
since
1982
the
main
focus
has
been
interpreting
the
charter.
Once
they
have
given
meaning
to
the
charter,
thereby
creating
law,
then
it
is
then
only
amendable
through
one
of
the
amending
formulae.
3) Royal prerogatives:
although
the
royal
prerogatives
are
defined
by
the
court,
their
authority
rests
in
the
historical
recognition
of
the
crown
and
its
prerogatives
legal
rights.
Since
the
constitution
act
of
1982
entrenches
the
monarchy
and
the
offices
of
governor
general
and
lieutenant
governor,
any
change
in
the
powers
would
need
the
use
of
the
appropriate
amending
formulae.
The
Royal
Prerogative
itself
is
the
residue
of
the
legal
power
residing
in
the
crown
and
passing
through
the
crown
to
the
crowns
representatives.
Royal
Prerogatives
are
the
contemporary
residue
of
those
ancient
powers
not
taken
away
from
statute
and
include
the
power
to:
money,
so
that
slowly
to
get
additional
funds
he
was
held
with
extortion
until
he
gave
up
more
powers
to
get
the
money.
The
limitation
of
the
monarchs
unbridled
power
to
veto
laws
has
been
removed
over
the
course
of
the
past
700
or
so
years.
Prerogative
powers
give
a
level
of
discretion;
they
are
there
to
protect
the
democracy
when
the
ministers
are
not
acting
appropriately.
Ironically
the
ancient
residue
exists
for
the
preservation
of
democracy.
Some
of
the
most
important
principles
of
the
constitution
are
referred
to
as
conventions,
which
guide
political
actors
in
how
they
function
but
are
not
enforced
by
the
court
and
are
thus
conventions
of
the
constitution.
They
are
not
contained
in
any
written
enforceable
document
but
instead
are
generally
accepted
traditions
and
principles
of
how
participants
in
the
process
should
function
at
particular
times.
The
supreme
court
of
Canada
in
1981
defined
the
conventions
in
the
case
Reference
Re-
Amendment
of
the
Constitution
of
Canada.
In
contra
distinction
to
laws
of
the
constitution
they
are
neither
created
by
the
courts
nor
enforceable
by
the
courts.
The
Supreme
Court
suggested
however
that
some
conventions
are
more
important
then
most
constitutional
laws.
The
court
in
the
same
case
held
that
conventions
are
a
part
of
the
constitution
and
the
constitutional
conventions
plus
constitutional
law
equals
the
total
constitution
of
the
country.
40
of
155
FEDERALISM IN CANADA
1.
What
is
federalism?
In
a
federal
system:
there
is
government
of
two
levels,
each
of
which
are
independent
and
each
is
assigned
different
jurisdiction.
1) K.C.
Wheare
wrote
the
seminal
work
the
federal
government
and
he
defined
the
federal
principles:
is
the
method
of
dividing
powers
so
that
the
general
and
regional
governments
are
each
within
a
sphere
co-
ordinate
and
independent.
The
existence
of
federal
principles
in
a
country
allows
it
to
be
regarded
as
a
federal
state.
In
a
federal
country,
governmental
power
is
distributed
between
a
central
authority
sometimes
called
a
national
authority
or
federal
authority
and
several
regional
authorities
sometimes
called
provinces
or
states.
It
is
distributive
in
such
a
way
that
every
individual
is
subject
to
two
authorities.
2) In
a
federal
system,
if
we
are
truly
federal,
the
two
authorities
are
coordinate
that
means
in
essence
that
neither
is
legally
subordinate
to
the
other.
In
a
unitary
state,
government
power
is
vested
in
one
national
authority;
there
are
a
municipal
government
with
powers
over
their
localities
but
differ
because
they
are
legally
subordinate
to
the
national
authority;
can
amend,
control
or
take
away
there
power.
An
example
of
a
unitary
state
is
the
United
Kingdom,
governed
by
one
parliament.
In
a
federal
state
it
is
common
to
speak
of
different
levels
of
government.
The
notion
of
equality
of
status
does
not
necessarily
extend
beyond
the
legal
format.
(In
Manitoba,
we
are
all
immediately
subject
to
the
laws
of
the
federal
government
and
the
laws
of
the
provincial
legislature
and
we
notice
this
every
time
we
buy
something:
PST
and
GST.)
3) The
key
point:
it
is
the
legal
guarantee
of
a
legal
autonomy
(not
legally
subordinate)
to
each
of
the
regional
authorities
in
respect
of
the
areas
which
constitute
their
jurisdiction,
however
dispirit
in
size
and
wealth
those
regional
authorities
may
be,
which
justifies
their
description
as
coordinate
with
the
central
authority.
Doctrine
of
Paramouncy:
reqs
that
federal
law
prevails,
but
regional
authorities
are
not
legally
subordinate.
1. To
be
truly
federal,
a
final
arbitrator
of
constitution
is
required
which
neither
level
of
government
alone
can
control
or
appoint.
2. A
method
of
constitutional
amendment
in
areas
related
to
the
division
of
power
is
required
which
neither
level
of
government
can
control.
1. We
are
subject
to
the
laws
of
2
authorities
and
jurisdictions
assigned
to
both
in
the
BNA
act
of
1867
there
were
two
jurisdictions
created.
b. Federal legislation: military security, post office, taxes, weights and measures.
3.
The
existence
of
the
amending
formulae
that
requires
provincial
participation
and
specifically
the
division
of
rights
further
strengthens
this
argument,
because
in
1982
there
was
an
argument
that
the
federal
government
could
do
it
alone.
4. The
colonies
are
to
be
federally
united
(was
written
in
the
BNA
act
of
1867
by
the
fathers
of
confederation.)
(end October 1)
42
of
155
The
ratio:
the
provinces
are
not
delegates
of
the
federal
parliament;
the
provincial
legislatures
are
in
their
own
spheres
supreme.
(significant
because
it
allowed
provincial
legislation
to
be
supreme
within
the
province,
constraining
federal
power.)
The
existence
of
the
JCPC
made
us
more
federal
because
it
was
a
truly
an
independent
arbitrator.
Now
it
is
the
supreme
court
of
Canada
appointed
by
the
prime
minister
with
the
result
that
we
are
less
federal.
They
have
attempted
to
erode
federalism
because
in
key
economic
decisions
they
always
align
with
the
federal
government.
However
despite
these
decisions
of
the
JCPC
there
is
more
than
a
little
doubt
that
Canada
is
a
federal
country;
in
fact
the
better
view
is
that
Canada
is
not
a
federal
country
because
it
does
not
measure
up
to
the
federal
principles
and
corollaries.
Wheare:
Canadian
constitution
is
quasi
federal
in
law
and
predominantly
federal
in
practice:
meaning
that
Canada
isnt
federal,
at
best
in
law
its
quasi
federal.
Canada
acts
like
a
federal
country
Cheffins
says
on
pg.
119:
What
Wheare
is
saying
is
that
in
constitutional
theory
the
central
government
is
given
sufficient
powers
to
control
the
autonomy
of
the
provincial
governments
and
thus
the
principle
of
equal
and
coordinate
status
is
not
sustained
in
the
black
letter
law
of
Canadas
constitution.
He
goes
on
to
make
it
clear,
though,
that
the
centralizing
features
of
the
Canadian
constitution
which
undermine
the
federal
principle
have
so
fallen
into
disuse
that
in
practice
Canada
is
a
genuine
federal
state.
43
of
155
a. the
federal
government
is
given
the
power
to
disallow
any
act
passed
by
a
provincial
legislature,
which
is
essentially
a
straight
veto
power.
2. Section
58
BNA
1867
the
federal
government
is
given
the
power
to
appoint
the
lieutenant
governor
of
each
province
and
Section
92
(1)
BNA
1867
provinces
are
denied
the
ability
to
alter
the
office
of
lieutenant
governor,
who
has
a
significant
impact
on
provincial
legislature.
3. Power of reservation
a. Section
57
BNA
1867
-the
federally
appointed
lieutenant
governor
of
each
province
can,
on
instruction
from
the
federal
government,
reserve
provincial
bills
for
the
consideration
of
the
governor
in
council
in
Ottawa.
They
can
send
a
bill
straight
to
the
parliament
b. In
recent
years,
the
use
of
power
of
disallowance
and
the
power
of
reservation
have
been
frequently
disused.
c. The
power
of
disallowance
was
used
112
times
to
disallow
the
provincial
act,
but
the
last
disallowance
took
place
in
1942.
d. The power of reservation was used 70 times, the last one taking place in 1961.
e. the
federal
parliament
was
given
the
power
to
unilaterally
bring
local
works
within
exclusive
federal
legislative
jurisdiction,
simply
by
declaring
them
to
be
for
the
general
advantage
of
Canada.
The
parliament
can
take
away
the
power
of
the
province
if
it
is
in
the
best
interest
of
the
country.
g. It
has
been
used
on
numerous
occasions,
but
not
since
the
early
1960,
important
to
matters
with
railways,
grain
matter,
atomic
energy,
bridge,
cannels.
4. Remedial
legislation
by
the
federal
government
in
the
event
that
Roman
Catholics
and
Protestants
are
deprived
of
their
traditional
rights
to
religious
education.
(Section
93
BNA
act)
44
of
155
a. This
power
has
never
been
used,
but
it
still
exists.
Tupper
tried
to
use
this
and
Laurier
had
prevailed
(
a
French
Catholic
)
and
didn't
use
it.
Manitoba
wanted
to
disallow
French
Catholics
to
practice
their
religious
education.
Ont.
Hydro
(1993)
DOCTRINE
OF
DESUETUDE
Provincial
argument
said
that
even
though
the
powers
are
not
used,
they
still
exist
and
have
standing.
It
was
proved
by
the
Supreme
Court.
5. Federal
government
power
to
appoint
judges
of
the
superior
court
(and
above)
and
in
addition
Section
101
allowed
the
federal
government
to
create
the
final
appellate
court
of
Canada
and
appoint
the
judges
(Section
96).
JCPC
no
longer
exists
so
Supreme
Court
is
final
appellate
court.
a. This
is
inconsistent
because
the
arbitrators
should
not
be
controlled
by
one
level
of
government.
6. Charter of rights
b. Judges
can
compromise
a
great
deal
of
provincial
jurisdiction
and
they
are
federally
appointed.
a. The
1982
amendment
has
made
the
process
more
federal
as
the
formulae
to
amend
the
entrenched
aspects
of
constitution
are
beyond
the
control
of
either
level
of
government.
Prior
to
1982,
the
process
could
be
dominated
by
federal
parliament.
1. Constitution
1867
reflects
the
values
of
the
individuals
that
created
it
at
the
time.
We
must
understand
the
times
of
when
the
act
was
created
and
the
reasons
for
Canadian
confederation.
Some
of
the
reasons
were:
o US
had
invaded
Canada
before
in
the
war
of
1812.
They
were
looking
for
more
resources
and
they
had
the
idea
of
Manifest
Destiny
through
the
Munroe
Doctrine.
o Also
in
1776
and
1777
Benedict
Arnold
was
the
leading
American
general
and
lead
the
attack
on
Ottawa
with
Benjamin
Franklin.
o People were worried because there was a real threat and danger.
o The
civil
war
had
just
ended
(1860)
and
they
feared
that
the
Americans
would
just
move
the
war
north.
Americans
thought
one
country
would
be
stronger.
o In
1840s
the
British
dismantled
their
mercantile
system
(vertical
integrated
industry)
and
wanted
their
colonies
to
work
on
an
international
level.
Canada
did
not
have
preferred
access
to
large
markets
anymore.
o In 1864 the 10 year treated was terminated by the American because they were mad at Canada.
o With confederation we could have a larger domestic market by creating our own country.
4. Existence
of
common
history
and
traditions,
the
growth
of
nationalism
on
the
international
scale.
Assembling
of
larger
states
into
one
nation
as
a
whole.
o Canada
is
actually
older
than
Italy
and
Germany
and
Australia,
so
why
do
we
insist
on
saying
were
young,
because
it
excuses
making
mistakes.
5. Former
British
colonies
and
in
the
years
prior
to
confederation
developed
distinct
political
and
economic
existences
which
they
did
not
want
to
see
submerged
in
a
larger
union.
(especially
New
Brunswick
and
Nova
Scotia)
46
of
155
6. French,
Roman
Catholic
population
of
Quebec
(as
opposed
to
the
rest
of
the
colonies
in
North
America)
o The
French
Canadians
rightly
worried
that
a
larger
union
without
a
federal
structure,
allowing
for
region
linguistic
and
religious
control
would
result
in
their
homogenization.
o A
federal
system
would
liberate
the
French
Canadians
from
at
least,
at
the
local
level,
English
Canadian
control
which
had
existed
in
the
province
of
the
Canadas
o The
various
maritime
colonies
at
the
time
of
confederation
had
a
perception
of
remoteness
from
central
Canada
and
therefore
the
desire
to
preserve
some
local
authority
and
governmental
power.
o Ontarios
interest
has
always
sided
with
a
strong
central
government;
they
made
sure
that
the
central
government
was
provided
with
the
legal
weapons
to
ensure
its
ultimate
dominance
over
the
provinces,
since
they
knew
that
they
were
the
most
populated
province.
There
is
federalism
in
Canada,
because
John
A.
Macdonald
made
sure
the
deck
was
stacked
in
favour
of
Ontario,
they
had
sufficient
legal
weaponry
if
they
needed
to
use
it,
because
of
their
size.
This
shows
that
this
reflects
political
values.
They
would
be
able
to
control
the
provinces
legal
and
economic
interests.
RESPONSIBLE
GOVERNMENT
47
of
155
2. It
illustrates
how
important
constitutional
principles
were
inherited
from
Great
Britain
and
the
pre-
confederation
period,
and
3. ***It
is
the
mechanism
which
ensures
the
democratization
of
executive
government
in
the
country.
Linked
the
exectutive
officials
to
In
any
governmental
system
you
need
executive
authority,
which
surrounds
the
operation
of
laws
and
government,
the
executive
has
a
great
deal
of
authority.
In
our
system
it
is
vital,
because
they
can
lead
to
the
declaration
of
war,
control
of
the
budget,
elect
judges,
has
been
the
recipient
of
a
great
deal
of
delegate
power
through
statute,
they
can
generate
a
lot
of
subordinate
legislation.
In a democracy you want concentrations of power to reflect the democratic power of the people.
o US
solved
the
problem
of
executive
power;
they
have
three
levels
of
government:
president,
senate,
congress.
o George
bush
has
tremendous
power;
the
American
constitution
is
the
reflection
of
the
British
constitution
except
they
elect
their
president
and
senate
(democratized).
o We
democratize
our
executive
but
in
a
more
subtle
way.
PM
is
the
head
of
the
executive
and
the
House
of
Commons.
o PM
has
total
control
between
elections,
appoints
the
Cabinet,
is
the
sole
advisor
to
the
monarch.
1. Judiciary
This
is
the
De
jure
authority
(by
the
law)
according
to
section
9
of
the
BNA
act
of
1867.
Section
9,
the
Queen
is
in
charge.
Section
10,
Governor
General.
Section
11,
Privy
Council.
The
de
facto
executive
(means
the
real
deal,
in
fact)
is
the
cabinet
and
is
said
to
be
the
only
active
part
of
the
Privy
Council,
called
the
prime
minister
or
premier.
Responsible
government:
the
appointment
of
persons
to
the
executive
who
sit
in
the
elected
assembly
and
who
have
the
support
of
the
elected
assembly.
An
analogue
to
this
is
that
the
monarch
or
representative
in
giving
ascent
must
follow
the
advice
of
the
executive
rather
than
his
or
her
own
personal
predilection
(bias).
Responsible
government
has
been
actualized
by
two
conventions
-
(highlights
the
role
of
the
prime
minister)
(existed
in
1849
for
Nova
Scotia
and
New
Brunswick
government)
1. The
leader
of
the
political
party
with
the
largest
number
of
seats
in
the
house
of
commons
is
appointed
prime
minister
or
premier
and
is
asked
to
form
a
cabinet
by
the
monarch
or
monarchical
representative
(the
selection
of
the
PM
reflects
the
democracy
of
the
legislative
assembly).
2. The
monarch
or
representative
must
act
under
the
advice
of
the
prime
minister
in
consenting
to
legislation
or
exercising
prerogative
and
executive
powers,
with
exceptions.
They
insure
that
to
a
certain
level
those
executive
powers
are
democratized.
It
is
the
de
facto
executive
that
exhibits
the
power
and
the
prime
minister.
That
executive
power
is
at
least
somewhat
democratic.
We
dont
directly
vote
for
the
head
of
our
executive,
like
the
Americans.
1982 REVISIONS:
49
of
155
1. Provided
for
a
domestic
amending
process
for
entrenched
aspects
of
the
constitutions,
this
was
to
patriate
the
constitution.
3. Provided
an
additional
subsection
with
respect
to
the
division
of
powers.
Section
92(A)
Cheffins
pg.
5
allowed
the
province
to
tax
exports,
6. It
also
allowed
the
UK
parliament
to
promise
to
sign
off,
would
never
legislate
for
Canada
again
(signing
off
clause),
and
7. Changes
made
to
all
the
names
of
the
constitutional
statutes,
part
of
Trudeaus
desire
to
limit
the
connection
with
UK
history.
Section
92
Provincial
legislature
was
able
to
make
amendments
to
their
constitution
as
long
as
it
had
not
affect
on
the
office
of
the
lieutenant
governor.
Prior
to
1982
certain
parts
of
the
constitution
had
to
be
changed
through
the
UK
parliament
(only
the
entrenched
aspects).
Now
much
of
the
Canadian
constitution
could
be
amended
in
Canada
(the
federal
parliament
could
change
their
constitution
Section
91(1)).
The
parts
of
the
constitution
which
could
not
be
altered
were
entrenched,
pg.
71
Cheffins:
by
entrenchment
we
mean,
there
are
certain
provisions
in
the
constitution,
which
are
beyond
the
normal
control
of
either
the
federal
parliament
or
the
provincial
legislature
that
is
to
say
that
certain
provisions
of
the
constitution
are
so
significant
and
so
important
that
they
can
only
be
changed
by
an
extraordinary
process.
50
of
155
o Section 91(2) enumerates the entrenched acts of the constitution; there were very few:
Division of powers,
o There
was
a
need
to
have
an
independent
body
in
control
so
that
the
quasi
federal
government
would
not
be
destroyed
by
one
party
or
another.
o The
formal
authority
was
the
imperial
parliament;
however
the
imperial
parliament
was
tightly
ruled
by
conventions
of
the
constitution,
which
made
the
imperial
parliament
essentially
an
instrument
of
Canadian
will.
Unanimous
provincial
consent;
however
there
was
a
case
that
only
substantial
consent
was
efficient.
Though
the
constitution
had
to
be
legally
amended
by
UK,
it
was
controlled
by
Canada.
1. The
amendment
process
was
said
to
be
patriated,
it
became
whole
domestic
with
no
need
to
seek
the
formal
amendment
from
the
imperial
parliament,
Patriate:
the
amending
process
with
respect
to
entrench
aspects
of
the
constitutions
is
made
wholly
domestic.
2. The
British
statutes
with
constitutional
relevance
to
Canada
were
entrenched
in
their
totality.
All
statutes
with
British
relevance
was
entrenched,
4. Two domestic amending formulae were defined to replace the imperial parliament:
ii) Resolution
of
the
legislative
assemblies
with
at
least
2/3
of
the
provinces
with
50%
of
population
called
the
7-50
rule.
Applies
to
the
Charter
of
Rights
as
well.
b) Unanimity
Provision:
separates
out
certain
things
that
are
so
important
that
the
general
procedure
isnt
applicable,
requires
the
unanimous
approval
of
all
the
provinces
(10).
Section
41
describes
the
subject
matters
to
which
it
is
applicable
(all
are
entrecnched):
ii) assurance
that
no
province
will
have
less
members
in
the
house
of
commons
than
it
has
of
senators,
v) the
requirement
that
the
amending
formulae
cannot
be
changed
except
with
the
unanimous
agreement
of
all
11
legislatures.
Experience
with
the
amending
formulae
is
that
nothing
is
easy,
these
methods
are
so
difficult.
There
were
two
approaches
to
change
by
the
federal
government:
a. Make
change
to
make
all
changes
to
be
unanimous
only,
ironically,
failed
to
get
acceptance
unanimously
(Manitoba
and
Newfoundland).
b. Mulroney
wanted
to
get
Quebec
into
the
constitutional
family,
but
Quebec
wanted
the
ability
to
veto.
c. Brian
Mulroney
in
a
compromise
wanted
to
say
that
all
provinces
could
have
veto,
but
then
it
would
be
entirely
a
unanimity
provision
instead
of
the
7/50
rule.
d. Through
the
Charlottetown
accord,
he
decided
to
add
a
distinct
society
clause
for
Quebec,
but
it
failed,
so
nothing
has
changed.
52
of
155
e. The
irony
of
the
inflexibility
is
that
it
is
easier
for
the
province
to
leave
then
amending
the
constitution
(Clarity
Act)
Contained
in
the
constitution
of
1982
is
part
of
the
constitution
and
therefore
entrenched
(section
52
is
the
empowering
part).
o Inconsistency Clause
The
charter
is
part
of
the
supreme
law
and
if
it
doesnt
measure
up
then
it
is
of
no
importance
or
effect.
The charter is the standard to which we measure law, and the judiciary determines inconsistencies.
It
gives
the
power
to
the
judiciary
because
they
determine
if
something
measures
up
to
the
charter,
amendment
is
virtually
impossible.
o freedom of association,
o mobility rights.
The
charter
is
very
vague,
for
example
what
is
a
mobility
right?
This
gives
Judges
maximum
power
to
Application section 32
Section 24 of text
The
charter
of
rights
represents
a
massive
transfer
of
power
from
the
legislature
to
the
judges,
because
2. Judges
can
give
it
any
meaning
they
wish,
especially
at
the
supreme
level,
53
of
155
4. If
someones
rights
are
violated
the
judges
can
give
any
solution/remedy
they
feel
is
appropriate.
Judges
arent
elected,
so
once
appointed
they
can
be
there
for
30
or
40
years.
Its
virtually
impossible
to
get
rid
of
them
and
yet
they
are
making
political
and
social
decisions.
In
the
preamble:
they
are
subject
to
reasonable
limits
and
it
is
up
to
the
judiciary
to
identify
what
those
reasonable
limits
are,
also
allows
certain
parts
of
the
charter
to
be
declared
inoperative
(notwithstanding
clause).
Restalls paper: charter is somewhat revolutionary and inappropriate with 4 basic reasons ---EXAM
2. Revolutionary
because
of
its
unknown
and
radical
impact
Cheffins
pg
131
even
experience
American
constitutional
lawyers
and
judges
might
flinch.never
before
have
judges
been
handed
so
much
responsibility
with
so
little
analysis
of
the
subtleties
of
what
was
being
done,
3. The
charter
of
rights
violates
the
constitutional
and
cultural
principle
of
federalism
to
the
extent
it
is
in
Canada.
It
is
centralizing
and
homogenizing
creating
generalized
national
cultural
standards
in
areas
formerly
under
exclusive
provincial
jurisdiction,
and
4. Cultural
revolution,
because
the
charter
is
inconsistent
with
the
basic
political,
cultural
and
philosophical
nature
of
the
country.
It
is
simultaneously
a
subtle
homogenizing,
centralizing,
and
Americanizing
influence.
(talked
about
in
Restalls
paper)
54
of
155
One
binding
theme:
the
concept
of
liability
legal
liability
is
a
right
that
is
enforceable
by
the
law
for
which
a
remedy
may
be
obtained
in
court.
Liability:
a
debt
or
obligation.
A
right
that
is
recognized
by
law
that
can
be
enforced
by
a
person,
by
a
court
process,
that
can
result
in
a
court
ordered
remedy.
a) Sole Proprietorships
Is
not
a
legal
entity
separate
from
its
owner
and
consequently
limited
liability
does
not
exist.
It
is
a
consequence
of
the
separate
entity
principle.
Income is added to the income of the sole proprietor for income tax purposes.
It is the most common and simplest form of business entity, easy to set up and dissolve.
It
exists
whenever
an
individual
carries
on
business
for
his
or
her
own
account
without
either
the
medium
of
an
incorporated
company,
or
the
participation
of
other
individuals
except
as
employees.
All
benefits
flowing
from
the
business
accrue
to
the
exclusive
enjoyment
of
the
sole
proprietor.
Conversely
the
sole
proprietor
is
directly
and
personally
liable
for
all
the
business
liabilities
of
the
sole
proprietorship
contractual
or
otherwise,
therefore
all
business
and
personal
assets
of
the
sole
proprietor
can
be
seized
in
fulfillment
of
the
sole
proprietorship
business
obligations
and
liabilities.
This
is
because
the
sole
proprietor
is
not
a
legal
entity
separate
from
its
owner
unlike
a
corporation
vies
a
vies
its
shareholders.
Income is added to personal income and the aggregate is taxed at the appropriate rate.
If
you
carry
on
business
in
your
own
name
then
you
do
not
have
to
register
the
business
name.
Otherwise
you
cant
use
a
name
that
can
be
confused
with
one
that
already
exists
or
one
that
is
inappropriate
on
public
grounds.
The
key
is
that
the
sole
proprietor
has
unlimited
liability,
all
his
or
her
assets
are
at
risk
for
business
liabilities,
which
is
a
dangerous
position
to
be
in.
Unlimited
Liability:
sole
proprietor
is
liable
for
all
the
liabilities
of
the
business
and
all
non
business
assets
are
exposed
to
creditors
of
the
business.
2. Put
your
investments
in
creditor
proof
assets;
ones
that
creditors
cant
attack.
Certain
type
of
investments
that
cant
be
touched
by
creditors.
3. In
advance
of
going
into
a
business
ensure
that
you
make
a
legitimate
business
and
estate
plan
to
redistribute
your
property
and
if
it
is
desirable,
transfer
assets
to
other
individuals.
Dont
transfer
to
the
spouse
because
in
the
case
of
a
separation
the
spouse
can
take
it.
After
a
lengthy
lawsuit
you
may
be
able
to
get
50%
of
all
property.
Certain
things
arent
divisible
in
marriage;
property
acquired
prior
to
the
marriage
(only
the
incremental
amount)
or
property
acquire
through
inheritance.
Property
exempt
from
the
division
in
the
marriage
act
would
be
dangerous
to
transfer.
For
example,
if
Mulroney
had
acquired
the
property
before
the
marriage
and
then
transferred
it
to
the
spouse,
then
he
would
not
have
to
share
the
property
instead
of
getting
it
all
in
the
case
of
separation.
56
of
155
If
you
transfer
to
your
parents
and
they
pass
away
and
their
will
is
wrong
then
other
beneficiaries
can
get
your
property.
You
can
achieve
some
protection
through
a
prenuptial
agreement:
determines
the
allocation
of
property
and
support
payments
in
the
event
of
divorce.
You
want
a
prenuptial
agreement
when
you
have
more
money
and
prospects
than
the
other
spouse.
When
are
you
opposed
to
a
prenuptial
agreement?
on
a
moral
basis
or
you
are
the
one
with
less
money.
The
problem
with
a
prenuptial
with
Mulroy
is
that
it
undermines
protection
from
creditors.
You
should
probably
do
a
combination
of
all
possibilities.
b) Cooperatives
Examples: Co-op, all credit unions, Mountain Equipment co-op, Red River Co-op
They
are
designed
to
provide
their
members
with
good
or
services
at
a
cost
lower
than
the
cost
of
similar
goods
and
services
in
the
market
place.
Or
it
may
be
organized
for
the
purpose
of
selling
goods
in
such
a
way
that
will
maximize
returns
to
the
members.
It
is
essentially
about
eliminating
the
middle
men
in
the
economy.
They
try
to
sell
their
product
as
directly
to
the
consumers
as
possible.
Similarly
consumers
attempt
to
buy
as
directly
from
the
producers
as
possible,
because
the
goods
can
be
delivered
cheaper.
a. It
was
created
because
they
were
forced
to
pay
high
prices
of
the
goods
and
services
from
the
only
producers
from
Ontario.
Buying
elsewhere
meant
that
there
would
be
lots
of
tariffs.
In
our
economy,
usually
the
control
of
the
organization
is
related
to
the
quantum
of
investment
and
is
designed
for
profit
maximization.
Co-operatives
forever
have
very
contrasting
characteristics.
They
were
progressive
political
idea.
Basic principles:
1. Each
member
has
one
vote
regardless
the
number
of
shares
held
and
the
capital
contributed
57
of
155
2. There are no proxy votes; you need to be there at the meeting to vote
4. Profits
not
required
to
operate
the
co-operative
are
paid
to
the
members
in
accordance
with
the
quantity
of
goods
purchased
or
sold
through
the
organization
by
the
member.
They
are
especially
good
in
western
Canada
because
the
middle
agents
are
all
from
eastern
Canada,
geographic
situation.
c) Partnerships
What
is
a
partnership:
definition
is
found
in
the
partnership
act,
section
1
a
partnership
is
the
relation
which
subsists
between
persons
carrying
on
a
business
with
the
view
of
profit.
It
is
important
because
of
the
consequence
of
finding
the
partnership
exists.
There
are
various
liniments
(features):
a. There is the element of agreement which is implicit, the absence of the agreement isnt fatal
b. The
need
for
a
business
is
said
to
include
every
trade,
occupation
or
profession,
but
does
not
include
every
activity
carried
on
for
profit.
i. Courts
have
highlighted:
a
sharing
of
the
profits
of
a
business
though
not
sufficient
by
itself
is
highly
indicative
of
the
existence
of
a
partnership
especially
if
there
is
no
alternative
method
of
payment.
ii. Additional evidence, which is in conjunction with the sharing of profits, includes:
Its
also
possible
to
become
a
partnership
by
estoppels:
precluded
from
denying,
where
you
hold
yourself
out
to
be
a
partner
even
though
youre
not
or
if
you
allow
someone
to
say
they
are
your
partner
you
can
be
held
to
be
a
partner
if
you
do
not
protest
it.
58
of
155
The
chief
consequence
of
becoming
a
partner
is
the
partners
unlimited
liability
to
outsiders
who
have
dealt
with
the
partnerships.
As
one
author
indicates,
in
many
respects
a
partnership
might
accurately
be
described
as
a
multiple
proprietorship.
The
general
partnerships
resemble
a
sole
proprietorship
in
that
it
is
not
a
legal
entity
separate
from
its
partners.
The
negative
reality
is
further
compounded
by
the
legal
principle
that
all
partners
are
agents
of
the
partnership,
so
that
means
that
each
individual
partner
can
go
and
create
liabilities
of
the
partnership.
In
a
sole
proprietorship
you
have
control
over
the
liabilities
being
created.
The
other
issue
is
the
reality
that
all
partners
are
agents
for
the
partnership,
so
they
can
create
liabilities
for
which
you
will
be
responsible.
The
partner
has
the
right
to
seek
compensation
for
the
liability
of
the
partnership.
All
partners
are
both
principles
and
agents
of
the
partnership.
(read
CHAPTER
19)
A
partner
is
only
liable
to
the
liabilities
that
the
firm
made
during
the
time
you
were
in
the
partnership,
if
you
terminate
properly.
ii. provide
actual
notice
to
people
who
have
dealt
frequently
and
recently
with
your
firm.
Several results:
a. A partner may not sue the partnership, although there may be actions between the partners
c. The
separate
assets
of
each
partner,
whether
a
corporation
or
an
individual,
are
at
risk
to
satisfy
the
contractual
and
other
liabilities
of
the
partnership.
In
other
words
partners
do
not
enjoy
the
limited
liability
of
a
shareholder
of
a
corporation.
i. Each
partner
is
jointly
and
separately
liable
for
the
liability
of
the
business;
any
creditor
can
sue
all
or
one
of
the
partners
of
the
extent
of
the
liability.
59
of
155
ii. If
you
are
a
partner
you
should
take
on
the
prophylactic
approach
described
for
the
sole
proprietorship.
Agent:
distinguishing
feature,
he
or
she
can
create
contractual
liability
for
the
principle,
agents
usually
exist
by
contract,
but
you
can
have
them
by
estoppels.
They
do
contractual
work.
He
must
always
disclose
that
he
is
an
agent;
they
a
per
(for)
the
principal.
To
be
a. Not
real
agents:
real
estate
agent,
sports
agent,
fashion
agency;
they
are
just
representatives
i. To
be
a
true
agent
you
need
to
be
able
to
sign
contracts
on
behalf
of
the
principal
b. Agents:
stock
broker,
lawyers,
a
person
can
get
the
power
of
attorney
Principal:
enters
into
an
agency
contract
with
parameters.
The
agent
enters
into
a
deal
with
a
third
party.
If
the
agency
contract
is
functioning
properly
then
the
liability
exists
between
the
principal
and
the
third
party.
An
example
is
a
stock
broker.
Implied
terms
of
the
partnership
act:
a
term
that
does
not
exist
in
a
contract
but
nevertheless
the
courts
will
insert
it
into
the
contract
even
though
the
parties
never
agreed
to
it.
Agency
law:
the
relationship
between
the
principal
and
agent
according
to
which
the
principal
has
authorized
the
agent
to
enter
into
contract
with
third
parties
in
the
principal's
behalf.
a. They
are
created
by
getting
into
a
contract,
either
by
verbal
or
written,
and
clearly
define
the
boundaries
of
the
agency,
the
matter
to
which
the
agent
can
bind
the
principal;
what
kind
of
contracts
can
they
make
b. Remuneration
for
the
agent
1. Common
law
implied
laws
-
courts
over
time
have
completed
or
created
implied
terms,
for
example,
wrongful
dismissal
cases:
every
employee
is
entitled
to
reasonable
notice.
Examples: section 27
ii. need the consent of all existing partners before you bring in a new partner,
iii. all
partners
are
liable
to
share
equally
in
contributions
to
capital,
in
losses
and
in
profits
of
the
partnership.
Section
29
-
if
there
is
no
fixed
time
period
upon
the
duration
of
the
business,
any
partner
may
terminate
the
partnership
at
any
time
on
given
notice
of
this
intention
to
do
so
to
all
other
partners.
Becomes
a
partnership
at
will.
Section 30 - if the partnership ends but still continues business, notice is required.
Implied
terms
are
ultimately
alienated
if
you
enter
into
a
partnership
agreement,
normally
20
to
30
pages
that
deals
with
provisions
of
all
the
implied
terms
and
changes
them
to
the
liking
of
all
the
partners.
Similarly
the
partnership
agreement
can
refine
those
terms
and
make
them
to
your
satisfaction,
to
suit
you.
AGENCY PRINCIPLE
Agent:
distinguishing
feature,
he
or
she
can
create
contractual
liability
for
the
principle,
agents
usually
exist
by
contract,
but
you
can
have
them
by
estoppels.
They
do
contractual
work.
He
must
always
disclose
that
he
is
an
agent;
they
a
per
(for)
the
principal.
To
be
a. Not
real
agents:
real
estate
agent,
sports
agent,
fashion
agency;
they
are
just
representatives
i. To
be
a
true
agent
you
need
to
be
able
to
sign
contracts
on
behalf
of
the
principal
61
of
155
b. Agents: stock broker, lawyers, a person can get the power of attorney
Principal:
enters
into
an
agency
contract
with
parameters.
The
agent
enters
into
a
deal
with
a
third
party.
If
the
agency
contract
is
functioning
properly
then
the
liability
exists
between
the
principal
and
the
third
party.
An
example
is
a
stock
broker.
Implied
terms
of
the
partnership
act:
a
term
that
does
not
exist
in
a
contract
but
nevertheless
the
courts
will
insert
it
into
the
contract
even
though
the
parties
never
agreed
to
it.
Agency
law:
the
relationship
between
the
principal
and
agent
according
to
which
the
principal
has
authorized
the
agent
to
enter
into
contract
with
third
parties
in
the
principal's
behalf.
a. They
are
created
by
getting
into
a
contract,
either
by
verbal
or
written,
and
clearly
define
the
boundaries
of
the
agency,
the
matter
to
which
the
agent
can
bind
the
principal;
what
kind
of
contracts
can
they
make
b. Remuneration
for
the
agent
Power
of
attorney:
happens
when
someone
is
chosen
to
do
the
bidding
of
a
person
incapable
to
carry
out
day
to
day
legal
tasks.
They
get
the
power
of
agency
which
is
general
or
limited.
They
are
determined
by
statute.
Ie.
For
elderly
or
people
out
of
town.
The
agent
should
be
acting
in
the
best
interest
of
the
donor
while
taking
care
of
issues.
Ratification:
if
an
agent
exceeds
the
authority
it
has
to
make
contracts,
then
the
principal
is
not
held
liable,
but
the
principal
can
ratify
the
contract
to
dissolve.
If
the
principal
does
not
ratify
the
contract
made,
then
the
pseudo-agent
is
held
liable
for
the
contract.
Agent
by
estoppels:
a
bar
or
barrier
which
prevents
a
person
from
denying
the
truth
of
certain
facts
when
this
person
by
words
or
conduct
has
lead
another
person
to
believe
that
certain
facts
are
true
and
to
act
and
rely
upon
these
facts.
The
agent
has
done
this,
the
i. Apparent
authority:
the
agent
has
no
real
authority
but
appears
to
have
authority
to
act
on
behalf
of
the
principal
on
account
of
the
past
matter
of
transacting
business
or
on
account
of
certain
practices
in
the
trade.
Similar
to
partnership
by
estoppel
ii. Holding
Out:
the
principal
has
used
words
or
behaved
in
a
manner
that
represented
the
other
person
as
the
other
principals
agent.
Or
the
agent
says
he
is
an
agent
and
the
principal
doesn't
do
anything
to
stop
it.
62
of
155
Agency
by
necessity:
when
the
agent
enters
into
contracts
with
a
third
party
for
the
benefit
of
the
principal
without
the
consent
of
the
principal,
and
to
limit
losses
that
the
principal
could
experience.
(exists
in
limited
cases)
To
test
the
agency
of
the
principal:
the
principal
in
such
cases
is
responsible
of
the
agent
(the
contractual
liability),
if
a
mythical
reasonable
person,
could
reasonable
assume
that
the
agent
is
acting
within
the
scope
of
actually
authority
then
the
principal
is
bound
by
the
act
of
the
agent.
o Ie,
salvaging
goods.
Termination
of
agency:
if
not
mentioned
in
the
contract,
it
is
terminable
by
notice.
Duties of the agent to the principal (can be implied to the contractual relationship):
1. Agent
must
comply
with
the
contact
establishing
the
agency
or
he
is
liable
2. Agent
must
be
diligent
in
reprising
3. Duty
of
care
implied:
whether
paid
or
not,
must
be
careful
4. Duty
of
personal
performance:
can't
sub
delegate
the
tasks
Fiduciary:
a
person
that
is
in
the
position
of
a
trustee,
they
have
a
duty
of
loyalty
to
the
principal
and
must
be
scrupulous
and
candid
to
the
loyalty
of
the
trustee.
Agents
are
the
original
fiduciary.
A
person
having
duty
created
by
his
undertaking
primarily
for
another's
benefit.
Acting
on
behalf
of
another.
Fiduciary duties:
1. Personal
performance
2. Don't
find
yourself
in
conflict
of
interest
and
take
advantage
of
the
situation
3. Cannot
take
secret
commissions
4. Complete
good
faith;
cannot
place
yourself
for
conflict
of
interest
between
agent
and
principal
5. Agent
cannot
act
on
behalf
of
third
party
and
principal
at
the
same
time
6. Agent
cannot
intercept
opportunities
of
the
principal
unless
the
principals
grants
permission
to
the
agent.
Remuneration:
an
agent
has
the
right
to
be
paid
by
the
principal.
Can
be
specified
in
contract,
if
not
then
paid
by
quantum
meruit:
you
are
entitled
to
be
paid
A LIMITED PARTNERSHIP
There
are
certain
partners
that
have
limited
liability
called
limited
partners
and
of
you
must
have
at
least
one
general
partner.
The
worrisome
thing
is
that
if
a
limited
partner
participates
in
a
management
functions,
they
are
transformed
into
a
general
partner
with
unlimited
liability.
It is not utilized as much because the tax advantages were eliminated in the early 90s.
Amendment
to
Partnership
Act
-
it
makes
provision
for
limited
liability
partnerships
and
it
received
royal
ascent
on
august
9th
2002
and
was
proclaimed
February
25th
2003.
Defn
of
LLP:
Provides
protection
for
the
personal
assets
of
an
innocent
partner
from
professional
liability
claims
arising
from
the
negligence
or
misconduct
of
another
partner,
associate,
or
employees
in
whose
work
the
innocent
partner
was
not
involved.
Texas
1991:
first
LLP
statute
following
claims
from
law
and
accounting
firms
in
late
1980s
(as
a
result
of
the
collapse
of
a
number
of
savings
and
loans
companies)
(A
partner
in
acc
or
law
firm
made
a
huge
error
resulting
in
major
law
suits
against
the
firm,
making
all
partners
liable
despite
the
error
not
being
known
to
them
and
that
they
had
no
hand
in.
This
occurred
in
a
number
of
firms
so
they
started
lobbying
for
LLP
legislation,
and
then
it
spread
rapidly
across
USA
then
up
to
Canada)
Only 3 professionals are eligible for LLPs as they have lobbied for it successfully:
o Lawyers
64
of
155
o Chartered Accountants
o Debts
o Another partner
That
arise
from
negligence,
wrongful
act
or
omission,
malpractice,
or
misconduct
(mali
fides
bad
faith)
of
another
partner
or
an
employee,
agent,
or
representative
of
a
partnership
occurring
in
the
ordinary
course
of
professional
practice.
Limitations
o If partner knew of negligence and failed to take reasonable steps to prevent its commission
This
form
of
liability
is
what
is
called
a
partial
shield
it
protects
innocent
partners
from
the
negligence,
wrongful
acts
etc.
of
others
in
the
firm
but
does
not
provide
any
protection
for
contractual
or
trade
debts.
The
LLP
model
which
extends
protection
to
contractual
or
trade
debts
is
call
the
full
shield
and
only
Saskatchewan
has
this.
Notwithstanding
the
protection
given
to
innocent
partners,
interest
in
partnership
is
still
available
to
creditors
(same
with
insurance)
but
cannot
go
after
personal
assets
d) Corporation
Not
the
most
numerous,
but
the
most
dominant
most
major
businesses
are
corporations.
65
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155
Separate
entity
principle:
a
corporation
is
a
separate
person
from
the
investors
(investor
shareholders),
because
so,
the
investors
are
not
responsible
for
the
actions
of
the
corporation,
gives
limited
liability
to
the
shareholders.
The
investors
can't
be
sued
for
the
entity
of
the
corporation.
Reason: corporations have a separate existence, are separate entities and are legal persons.
They
cant
do
much
though
by
themselves
because
they
are
artificial,
they
must
act
through
human
agents;
they
cant
do
anything
themselves.
There
is
an
importation
of
agency
law,
because
they
act
through
human
agents
and
all
the
activities
are
conducted
by
human
agents,
so
it
was
a
natural
process
to
adopt
this.
Various characteristics:
1. Limited
liability
is
the
critical
feature
of
the
corporation
and
is
the
feature
that
makes
it
so
popular
-
the
natural
consequence
of
being
a
separate
entity
Limited
liability
means
that
a
shareholder
is
only
liable
to
lose
his
or
her
investment
and
or
the
amount
of
the
shares
for
which
he
or
she
has
not
paid.
A
sound
protection
of
assets
for
the
shareholders
The
ability
to
routinely
incorporate
in
business
and
have
limited
liability
is
one
of
the
most
important
economic
achievements
of
North
American
culture,
because
it
has
emboldened
investors
(they
are
not
risking
all
their
assets)
and
because
it
has
generated
as
much
wealth
as
the
industrial
revolution.
2. Tax
Advantage:
(1)
payments
of
salary
to
spouse
and
children
is
easily
facilitated
through
the
corporation,
(2)
dividends
sprinkling:
giving
dividends
to
family
members
who
are
in
the
lower
tax
brackets
for
lower
marginal
tax
rates
(3)
Small
Business
Tax
Deduction:
eligible
for
tax
savings
for
corporate
tax
rate
(MB
11%
for
less
than
$500,000
profit)
(although
this
cant
be
spent
on
yourself,
but
it
can
be
used
as
a
tax
shelter)
(4)
preferential
tax
breaks
for
dividends
(5)
capital
gains
exemption
for
the
sale
of
shares
for
the
first
$750,000
(tax
free
capital
gain)
(6)
Estate
Freeze:
allows
you
to
pass
active
shares
to
your
heirs
without
tax
consequences.
(7)
IPP
Individual
Pension
Plan
you
can
put
more
into
this
pension
plan
than
an
RRSP
with
similar
tax
treatment,
and
it
doesnt
die
with
you,
it
stays
in
the
company)
66
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155
3. Management:
a
partnership
is
unsuitable
for
a
situation
with
a
lot
of
investors.
Shareholders
on
the
other
hand
have
no
authority
to
participate
in
management.
Their
essential
right
is
to
elect
the
board
of
directors
once
a
year.
5. Continuous
existence:
its
an
artificial
entity
that
can
live
for
every,
which
is
an
advantage.
If
someone
dies,
the
corporation
does
not
have
to
dissolve.
There
are
annual
fees
that
are
required
to
be
paid.
6. Loyalty:
partners
cannot
compete
with
the
partnership
because
of
fiduciaries
duties;
shareholders
do
not
hold
any
such
loyalty
because
they
are
not
fiduciaries.
You
can
have
shares
in
competing
corporations
as
a
shareholder.
7. Separation
of
ownership
and
management:
there
are
2
types
of
organizations:
small
companies
and
large
companies
and
depending
on
this
it
will
affect
the
type
of
ownership/management
disputes.
If
compensation
packages
are
too
big
for
managers
in
large
companies
(usually
publicly
traded),
shareholders
get
upset
because
it
lowers
the
growth
of
the
stock
as
well
as
lowers
dividends.
In
small
companies,
there
are
few
owners,
and
oppression
of
the
minority
shareholder
occurs
we
refer
to
their
position
as
being
locked
in
and
frozen
out
you
cant
sell
it
to
anyone
other
than
your
fellow
shareholders
who
will
only
buy
your
shares
at
a
highly
discounted
price,
and
they
also
use
the
BoD
powers
to
fire
you
so
you
have
no
say
in
the
company
and
you
cant
get
rid
of
your
shares
without
suffering
a
major
loss.
Generally publicly traded, but they have role specialization due to our advance technology.
Owners
do
not
have
the
specific
skills
to
operate
and
manage
the
companies,
so
there
is
a
distinction
of
managers
and
owners.
There
is
a
difference
and
rivalry
between
shareholders
and
managers.
(De
minimus
a
trifling,
ridiculous)
67
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155
The
big
topic
is
executive
compensation
because
it
affects
shareholders.
Shareholders
are
interested
in
capital
gains
and
dividends.
Managers want to have salaries, pension benefits, etc. for their benefits.
Why
are
these
two
parties
in
competition?
The
money
has
to
go
to
one
or
the
other.
If
the
compensation
is
too
generous
then
its
coming
out
of
the
shareholders
profits.
Classically are not publicly traded and are exempt from the requirement of the securities act.
Generally
there
are
owners
that
are
actively
participating
in
management
or
outright
labour
of
the
corporation.
The
shareholder/management
issues
are
quite
different.
a
minority
shareholder
is
locked
in
and
frozen
out
they
cant
sell
their
shares
except
at
a
very
discounted
price
because
nobody
wants
to
pay
to
be
a
minority
shareholder
(take
their
place),
but
are
frozen
out
because
they
have
no
influence
on
management
with
a
minority.
The
most
important
clause
is
the
shot
gun
clause:
make
an
offer
to
the
other
party
at
a
price
per
share
and
its
their
choice
of
whether
they
buy
or
whether
they
sell.
2. if
one
party
is
undercapitalized
(have
no
money)
you
cant
realistically
buy
them
out.
3. In
those
cases
the
price
per
share
will
be
determined
by
someone
else
so
that
the
undercapitalized
will
be
considered.
(19:30)
68
of
155
The
courts
are
somewhat
against
meddling
with
this
principle
historically
because
it
has
resulted
in
a
great
deal
of
prosperity
(Salomons
case
1897)
To
ignore
the
separate
entity
principle
means
to
pierce
the
corporate
veil
(ignoring
that
the
corporation
is
a
separate
company
and
holding
the
owner
responsible):
they will do it in
1. Taxation
situations
-
statutory
piercing,
must
share
the
first
$400,000.
Sole
Proprietor
Taxed
45%,
Corporation
taxed
11%
preferred
rate.
Money
must
stay
in
the
corporation,
however,
when
withdrawn;
it
is
taxed
as
personal
income.
An
associated
group
must
share
the
lower
tax
rate.
2. For
the
residence
of
the
corporation
and
the
controlling
shareholders
(not
where
it
is
formed
but
where
the
controlling
shareholders
reside).
3. Agency
principles
-
whether
they
are
an
agency
or
shareholders,
but
they
need
a
written
agreement,
and
4. In
certain
situations
of
fraud,
in
particular
the
Patton
case
-
they
wont
allow
the
separate
entity
principle
to
be
an
instrument
of
fraud.
3. What
are
the
four
basic
limitations
on
the
separate
entity
principle
in
corporate
law?
1. Taxation
a
Corporation
is
eligible
to
enjoy
a
lower
tax
rate
on
its
first
$200,000.
2. Residence
the
residence
of
the
controlling
shareholder
may
determine
the
company
residence.
3. Agency
the
agent
cannot
represent
a
shareholder
unless
a
shareholder
agreement
has
been
signed.
4. Fraud
when
fraud
has
been
committed
the
court
will
disregard
the
separate
entity
principles,
but
will
see
the
directions
have
committed
the
fraud.
1) The
royal
charter
corporation:
created
through
the
use
of
the
royal
prerogative
-
residue
of
unilateral
powers
of
the
monarch.
Historically
the
crown
used
them
to
create
companies
for
a
fee,
one
of
the
ways
through
which
the
monarchs
actually
raised
money,
it
was
a
source
of
income.
Example:
69
of
155
Hudson
Bay
Company
in
1670.
Arent
formed
anymore
because
the
royal
prerogative
has
been
terminated.
2) Special
act
Corporation
(Statutes):
for
major
public
works.
This
method
is
still
employed
in
created
crown
corporations
(CPR,
CNR,
MPI).
Special
statutes
used
to
create
corporations.
3) General
(routine)
acts:
acts
that
business
or
other
people
can
resort
to
create
a
corporation
according
to
the
procedure
laid
out.
This
is
the
typical
way
corporations
are
created.
Three
basic
types
of
general
acts:
c. Certificate
of
incorporation.
In
the
BNA
act
you
can
have
federal
companies
and
provincial
companies,
there
is
a
split
jurisdiction
and
they
have
different
acts.
The
federal
statue
is
called
the
Canada
Corporation
Act
and
the
provincial
statute
is
called
the
Corporations
Act.
The
major
difference
is
that
federal
companies
are
more
expensive
and
may
be
protected
with
your
name
across
Canada.
1) Do
a
corporate
name
search
to
ensure
the
name
is
available,
can
create
your
own
name
or
they
can
give
you
a
number.
It
costs
35$
to
search
the
name.
Very
challenging
to
find
a
unique
name.
2) You
then
also
must
create
and
submit
to
the
corporation
branch
the
articles
of
incorporation,
based
on
Section
6
of
MB
Corporations
Act,
including:
name
of
the
company,
corporate
head
office,
nature
of
business,
types
of
shares
and
their
rights,
privileges
and
other
characteristics,
the
names
of
the
first
directors,
and
the
incorporators
and
any
restrictions
for
the
company
carrying
on
business.
Like
the
entrenched
aspect
of
the
corporation
(restrictions
on
business
that
it
can
carry
on).
3) Must
submit
a
fee
of
300$,
for
an
extra
200$
they
can
give
you
preferred
service
overnight.
If
not,
after
about
a
month
you
get
the
articles
of
incorporation
back
and
it
is
stamped
and
it
is
called
the
certificate
of
incorporation.
70
of
155
Provide rules by which the participants/agents in the artificial entity must follow
1) Articles
of
incorporation
(constitution
of
a
company):
if
you
want
to
change
it
you
need
a
2/3
majority
voting
shareholders,
including
the
above
and
any
restriction
on
the
type
of
business
that
can
be
carried
out.
This
part
is
entrenched.
2) Bylaws
not
entrenched
and
instead
can
be
changed
by
a
simple
majority
of
shareholders.
Initially
the
first
directors
create
bylaws,
but
must
be
ratified
by
the
shareholders
at
the
first
meeting.
It
provides
the
regulation
for
general
governance
corporation.
Bylaw
#1:
5. Signing authority
1. Shareholders:
are
the
investors,
purchase
shares
with
money
or
capital
and
they
have
very
few
rights
in
the
corporation.
Missing
some
stuff
ii. They
must
have
the
ability
to
participate
in
the
approval
of
changes
made
to
the
corporation
including
all
of
its
undertaking
or
changing
or
amending
the
articles
of
incorporation.
iii. There
are
different
types
of
shareholders:
voting
rights,
dividend
rights,
and
redemption
value
rights
(by
back
shares
at
a
certain
price).
iv. The bulk of the articles of incorporation revolve around the classes characteristics.
1. Voting or non-voting
3. Redemptions
rights
-
gives
corporation
the
opportunity
to
buy
back
the
shares
from
shareholders
4. Retraction
rights
-
the
shareholder
can
force
the
corporation
to
buy
the
shares
from
them
5. Etc.
1. common
shares
which
generally
have
the
right
to
vote
and
no
predetermined
dividend
right
or
rate
and
rank
last,
2. preferred
shares:
dont
vote,
entitled
to
dividends
to
a
%
of
return
and
rank
ahead
of
common
shareholders
if
there
is
a
surplus
on
dissolution.
vii. Best
is
the
assign
certain
people
to
certain
class
in
order
to
discriminate
the
shareholders
but
it
will
give
members
different
level
of
dividends
based
on
income
level.
2. Directors:
are
charged
with
the
management
of
the
corporation,
they
are
the
agents
through
which
the
corporation
acts.
i. They
exercise
the
power
of
the
corporation,
they
adopt
the
initial
bylaws.
Under
section
100,
directors
need
not
be
shareholders.
3. Officers:
run
the
corporation
on
a
daily
basis,
need
not
be
directors,
are
elected
annually.
Ie.
President,
VPO,
VPF,
etc.
Directors
are
often
officers
and
shareholders
in
small
companies.
One
can
say
that
they
are
public
if
there
is
a
distribution
to
the
public
of
their
shares
and
they
are
involved
in
sales
in
the
stock
market.
72
of
155
Under
the
security
act,
a
public
company
is
required
to
do
a
filing.
Public
company
is
defined
by
not
being
what
is
defined
as
a
private
company
under
the
security
act.
To
prevent
fraud
on
potential
investors
in
public
trading
or
distribution
of
shares.
As
a
private
company
you
are
exempt
from
many
of
the
costly
actions
as
required
by
the
securities
act.
1. right
to
transfer
its
shares
is
restricted
(usual
restriction
is
that
any
transfer
of
shares
is
subject
to
approval
of
BoD,
2. the number of its shareholders is limited to not more than 50 (not including employees), and
3. any
invitation
to
the
public
to
subscribe
for
its
securities
is
prohibited
(no
advertising
beyond
family
and
friends
basically),
this
is
a
violation.
Agency
is
a
relationship
between
the
principal
and
its
agent
according
to
which
the
principal
has
hired
and
authorized
the
agent
to
enter
into
contracts
with
third
parties
in
their
name.
Insurance
and
real
estate
agents
are
not
real
agents,
lawyers,
however
are.
They
are
merely
sales
representatives.
Agency law plays a role not only in corporations but business organizations.
It
is
appropriate
in
corporate
law
because
corporations
are
artificial
entities
and
must
act
through
human
agents
Board
of
directors:
one
of
the
consequences
is
that
each
director
is
a
fiduciary
because
they
are
an
agent.
We
also
see
in
corporate
law
the
principles
of
law
called
apparent
authority
of
an
agent
creation
of
an
agency
by
estoppel
precluded
from
denying,
where
an
agent
may
acquire
apparent
authority
from
a
past
manner
of
transacting
business
by
the
principal
or
from
trade
custom.
73
of
155
o Such
circumstance
may
make
it
appear
to
third
parties
that
the
agent
has
authority
for
the
contract
at
hand,
in
fact
however
he
or
she
does
not
have
any
real
express
authority
for
the
purpose.
o Normally
in
an
agent
situation
there
is
expressed
authority,
they
know
exactly
what
they
are
supposed
to
do.
o Sometimes
it
appears
to
the
outside
world
that
there
is
authority
where
none
exists,
this
are
called
agency
by
estoppel
precluded
from
denying.
1. Apparent
authority
an
agent
may
acquire
apparent
authority
from
a
past
manner
of
transacting
business,
business
by
the
principal
or
trade
custom.
Such
circumstances
may
make
it
appear
to
third
parties
that
the
agent
has
authority
for
the
contract
at
hand.
In
fact,
however,
he
or
she
does
not
have
any
real
or
expressed
authority
for
that
purpose.
There
exists
no
understanding
between
the
putative
(alleged)
agent
and
the
principal
to
grant
this
authority.
2. Holding
Out
you
are
representing
yourself
or
allowing
someone
to
represent
you.
Two
ways:
1. If
someone
is
representing
to
the
world
that
they
are
someones
agent
and
the
person
knows
and
doesnt
say
anything
otherwise
OR
Text
book:
generally
speaking
a
corporation
is
liable
for
the
acts
of
its
agents
under
the
ordinary
rules
of
agency.
An
officer
of
a
corporation
acting
within
his
or
her
usual
authority
but
without
express
authority
may
bind
it
to
contracts
made
with
third
parties.
Corporation
may
ratify
acts
made
by
unauthorized
agents
on
its
behalf.
74
of
155
Implicit
is
the
role
of
the
law
of
agency
and
in
particular
apparent
authority.
In
an
agency
relationship,
generally,
there
are
two
parties:
principals
and
agents
who
establish
their
relationship
through
a
contract.
If
the
agent
does
their
duties
properly,
theres
no
mali
fides,
then
the
liability
will
be
with
the
principal
and
third
party.
At
one
time,
the
public
was
deemed
to
have
notice
of
the
contents
of
documents
filed
in
the
public
registry
whether
they
had
read
then
or
not.
If
the
documents
prohibited
either
the
corporation
or
one
of
its
officers
from
carrying
out
certain
acts,
a
third
party
could
not
rely
upon
what
otherwise
might
be
the
officers
apparent
authority
to
perform
those
acts.
The
public
was
presumed
to
have
notice
of
publicly
registered
documents
limiting
apparent
authority.
That
rule
could
lead
to
substantial
injustice
(as
no
one
would
ever
look
up
these
publicly
registered
documents)
and
has
now
been
abolished
by
statute.
At
times
there
are
requirements
in
a
corporations
constitution
and
governing
act
that
require
certain
acts
to
be
performed
in
a
specific
manner
if
they
are
to
be
valid.
o For
example,
under
bylaws,
all
contracts
must
be
in
writing
and
signed
by
the
entire
board
of
directors.
o If
they
are
invalid
then
that
is
a
punishment
for
the
people
who
enter
into
contracts
with
the
corporation.
The
corporation
could
do
it
on
purpose.
What
is
the
effect
upon
an
innocent
third
party
if
the
corporate
act
has
been
performed
in
an
irregular
manner?
75
of
155
o The
seminal
authority
on
this
point
is
the
well-known
case
of
Royal
British
Bank
v.
Turquand.
o The
ratio
in
this
case
was
that
in
the
absence
of
notice
of
the
irregularity
or
of
suspicious
circumstances
everything
which
appears
regular
on
its
face
may
be
relied
upon
by
an
outsider
and
will
bind
the
company.
2. Notice
of
irregularity
it
is
a
danger
to
know
too
much
about
the
internal
aspects
of
the
organization,
if
you
notice
the
irregularity
and
say
nothing
about
it
then
the
contract
can
be
invalid.
3) Pre-Incorporation Contract:
The
individual
who
purported
to
contract
on
behalf
of
the
corporation
could
not
be
held
to
the
contract
either,
since
the
intention
was
to
contract
with
the
corporation.
(occurs
when
people
dont
want
to
incorporate
until
they
know
that
the
contract
will
be
accepted
by
the
other
party
ie.
They
will
make
money
and
not
have
to
potentially
eat
the
incorporation
fees
and
then
make
no
money)
a) The
corporation
is
bound
by
the
contract
and
is
entitled
to
the
benefits
thereof
as
if
the
corporation
had
been
in
existence
at
the
date
of
the
contract
and
had
been
a
party
thereto,
and
b) A
person
who
purported
to
act
in
the
name
of
or
on
behalf
of
the
corporation
ceases
to
be
bound
by
or
entitled
to
the
benefits
of
the
contract.
DIRECTORS DUTIES
The
equity
owners
are
called
shareholders
-
only
participate
really
in
the
corporate
governance
once
a
year
in
the
election
of
the
board
of
directors.
The
directors
are
in
charge
with
the
management
of
the
corporation
and
do
not
have
to
be
shareholders.
Duties of the directors are owed to the corporation, not the shareholders.
One of the ways that directors activity is controlled is through directors duties.
The
law
generally
upholds
a
vacuum;
they
have
authority
but
no
restrictions
on
authority.
Consequently
so
long
as
the
directors
were
acting
appropriately
to
the
corporation
then
they
were
protected.
The
law
doesnt
like
this,
so
over
the
last
1000
years,
fiduciaries
have
had
duties
and
if
they
fail
to
follow
these
duties
then
they
are
liable
to
someone.
Definition
of
fiduciary
from
Blacks
law
dictionary,
the
term
is
derived
from
roman
law
and
means
(as
a
noun)
a
person
holding
a
character
of
a
trustee
or
a
character
analogous
to
a
trustee
in
respect
to
the
trust
and
confidence
involved
in
it
and
the
scrupulous
(high
level
ethics)
good
faith
and
candour
(honesty)
which
it
requires.
Secondary
definition:
a
person
having
duty
created
by
his
undertaking,
to
act
primarily
for
anothers
benefit
in
matters
connected
with
such
undertaking.
a. a
director
is
bound
to
exercise
reasonable
care
and
that
means
that
he
she
or
it
cannot
be
negligent
in
carrying
out
duties.
a. If
you
are
in
a
conflict
of
interest
you
must
act
properly.
2
types
of
bona
fides:
77
of
155
ii. Interception
of
corporate
opportunity
you
hear
about
some
great
opportunities
or
financial
schemes.
You
cant
go
out
and
steal
the
deal;
thats
an
interception
of
corporate
opportunity.
Essence
of
the
principle:
you
have
to
act
in
the
best
interest
of
the
corporation
or
client,
or
dont
take
whats
not
yours.
If
you
do
you
will
have
to
give
up
any
benefits
received
as
a
result
and
may
have
to
pay
for
damages.
However,
the
potential
liabilities
of
directors
have
been
expanded
beyond
merely
what
are
the
common
law
duties
in
this
section
(Restalls
paper).
There
is
a
new
variety
of
directors
liabilities
most
of
which
are
called
gatekeeper
liabilities
-
the
attempt
to
control
wrong
doing
of
companies
by
making
the
directors
liable
through
duties.
The
liabilities
consist
of
financial
and
penal
nature
for
directors.
This
protects
the
government's
revenue
from
the
corporations.
Some
of
these
duties
are
owed
to
a
series
of
individuals
depending
on
the
statutes:
(about
400)
its
owed
to
shareholders,
employees,
creditors
etc
Point
of
paper:
by
making
directors
liable
for
so
many
things,
prudent
people
will
not
apply
to
be
directors
and
therefore
you
will
not
get
prudent
people
and
it
will
erode
the
money
making
capabilities
of
the
corporation
The
Supreme
Court
has
indicated
that
directors
remain
liable
even
if
they
quit,
during
a
time
of
crisis.
78
of
155
From
a
societal
standpoint,
corporations
created
a
lot
of
prosperity
because
they
were
able
to
obtain
limited
liability.
As
a
result
the
people
that
will
be
members
of
board
of
directors
wont
be
the
best
because
reasonable
people
wont
take
the
job.
This
damages
the
potential
for
prosperity.
Slowly and inevitably reasonable people will not be a part of the board of directors.
Common
law
duties
created
did
not
protect
minority
shareholders,
so
the
legislatures
intervened
with
gatekeeper
liabilities.
However,
many
of
these
only
protected
government
revenues
and
employees.
Traditional
minority
shareholder
protection
is
derivative
action
a
shareholder
can
sue
the
board
of
directors
in
the
name
of
the
company
for
the
wrong
done
to
the
company,
It
is
seldom
used
because
the
courts
require
very
high
deposit
monies
(a
bond),
require
costs
being
deposited
in
advance
and
as
a
result
few
shareholders
are
willing
to
do
this.
A
more
common
method
for
minority
shareholder
protection
is
oppression
remedy
of
the
corporation
act:
appeal
to
the
court
that
they
have
been
oppressed
and
unfairly
treated
and
entitled
to
a
remedy.
The
judge
can
choose
the
remedy
and
there
is
no
limitations
to
it
given
by
the
court.
Long
process
and
the
uncertainty
of
results.
Allows
an
oppressed
shareholder
to
go
to
court
on
a
summary
basis
and
obtain
relief.
It
is
pled
on
the
basis
of
affidavit
evidence
(no
trial)
and
if
the
judge
can
accept
that
there
is
unfair
treatment
they
can
put
forth
a
remedy
they
see
fit.
o Some
possible
remedies:
The
court
can
dissolve
the
company
and
disperse
the
capital
on
their
own
means
Court
can
order
the
forced
purchase
of
shares
o Used to be used mainly for dilution of shares but now is being used much more liberally
Shareholders
have
a
right
to
financial
statements,
documents
of
record
must
be
kept
and
shareholders
have
the
right
to
inspect
them,
documents
of
insider
trading
must
be
kept,
the
voice
of
shareholders
was
enhanced
as
they
have
the
right
to
attend
all
shareholders
meetings,
to
receive
79
of
155
notice
for
meetings,
to
vote,
and
for
certain
matters,
special
majorities
are
required
(to
change
the
articles
or
other
reasons)
and if you have 5% of shareholder you can apply to the court for an inspector,
4. Gave
shareholders
the
right
to
vote
to
make
a
change
and
only
to
do
it
by
a
special
voting
majority,
more
than
2/3.
5. Proxy
votes
were
allowed
and
made
it
permissible
for
shareholders
to
have
other
people
vote
for
them.
This
has
given
the
managers
more
control
because
they
get
the
proxies.
Fundamental
changes
was
instituted
-
changing
articles
of
corporation
etc
need
75%
majority
of
each
class
of
shares.
1. Employment opportunities
3. Capital Control
Could send a double edged offer to sell or buy at a price per share.
To
not
get
exploited
they
can
create
the
Fair
Market
Value
Provision,
which
the
share
price
is
determined
by
an
arbitrator
Criteria
for
selection
between
the
basis
forms
of
business
entities
(27:00)
seem
to
push
the
corporation
as
the
desired
form
1) Limited
liability
and
the
nature
of
the
business
if
there
are
substantial
risks
that
are
uninsurable
you
should
incorporate
4) Estate
planning
the
estate
is
the
property
you
own
upon
your
death
and
there
are
various
methods
to
minimize
the
taxes
that
are
payable
5) Number of proposed proprietors with too many partners, may need to incorporate
7) Borrowing
requirements
available
terms
and
relationship
of
proposed
lenders
sometimes
lenders
will
force
a
business
structure
on
you
to
make
it
easier
for
them
to
claim
your
companys
assets
8) Available
government
grants
(for
Canada)
sometimes
the
government
prescribes
what
type
of
organization
you
can
utilize
9) Employee
ownership
sometimes
as
an
incentive
you
would
like
to
give
them
a
share
of
the
business,
like
employee
stock
options
for
positive
re-enforcement
10) Costs
more
expensive
to
set
up
one
type
over
another
(initial
and
ongoing
costs)
81
of
155
11) Flexibility
of
structure
sometimes
it's
important
to
amend
the
structure
over
time,
effects
not
only
the
structure
but
the
agreement
(corporations
quite
inflexible)
13) Applicable
government
requirements
some
requirement
prevent
some
individuals
from
forming
different
types
of
organizations,
ex.
Only
CAs,
CGAs
and
lawyers
can
have
an
LLP.
Ex.
Chiropractors
cant
incorporate.
Liability:
a
legal
right
enforceable
by
and
against
legal
persons
by
way
of
court
process
where
court
can
apply
a
remedy.
With
liability
there
needs
to
be
a
remedy
to
be
a
liability.
2 sources of liability
1. Statutory
liability
coming
from
statutes
from
delegate
bodies
ex
mining
act,
income
tax
act,
family
poverty
act,
etc.
2. Common
law
liabilities
liabilities
established
from
the
courts
up
until
the
20th
century
the
courts
established
the
vast
preponderance
of
liabilities
In
its
simplest
form,
a
tort
is
an
act
or
omission
of
circumstances,
that
cause
an
injury
to
someone
or
their
property,
where
the
person
performing
the
act
has
no
lawful
excuse
to
do
so.
The
purpose
of
tort
law
is
to
compensate
the
injured
party
for
the
loss
suffered
by
the
tortuous
act,
rather
than
punish
the
wrong
doer.
While
many
torts
have
a
criminal
aspect
to
them,
such
as
assault
or
fraud,
tort
law,
does
not
normally
attempt
to
do
more
than
provide
compensation
for
injury.
Each
type
of
liability
can
be
broken
down
into
constituent
elements
and
it
is
naturally
up
to
the
plaintiff
by
the
way
of
proof
that
those
constituent
elements
exist;
they
must
establish
this
to
the
applicable
standard
of
proof.
In
tort
law
the
applicable
standard
of
proof
is
the
balance
of
probability.
In
civil
matters
each
element
much
be
established
in
the
balance
of
probability.
Certainty
of
50%
+
1
only
required
for
standard
of
proof.
Three
elements:
1)
causation,
2)
intention
and
3)
proscribed
harm
that
must
be
proven.
82
of
155
The
standard
of
proof
in
criminal
matters
is
beyond
the
reasonable
doubt
means
above
95%
certainty.
They
can
render
different
results,
because
even
though
the
evidence
is
basically
the
same,
there
are
different
standards
of
proof.
Example
OJ
Simpson
case.
Also
showed
that
under
the
same
context
you
can
have
civil
liability
and
criminal
liabilities,
they
are
not
mutually
exclusive.
Consider
deleting
1. Tort
3. Property
4. Restitution
(Developing
area,
based
on
the
principle
of
unjust
enrichment
probably
dont
need
to
know)
Elemental
approach
/
analysis
for
each
specific
type
of
liability,
there
are
constituent
elements
(like
water
is
made
of
hydrogen
and
oxygen)
ex.
For
any
crime,
the
prosecution
must
prove
each
specific
element,
like
intent
Modern Tort
Torts
are
the
first
category
of
liability
and
are
defined
by
the
textbook:
The
law
of
tort
is
concerned
with
the
ever
expanding
variety
of
harm
suffered
by
individual
incident
to
all
activities
necessarily
carried
on
in
our
increasingly
complex
society.
83
of
155
From
the
CMA
notes,
Restall
prefers
this
definition:
a
tort
in
its
simplest
form
is
an
act
or
omission
in
some
circumstances
that
causes
injury
to
someone
or
their
property
where
the
person
performing
the
act
has
no
lawful
excuse
to
do
so.
The
purpose
of
tort
law
is
to
compensate
the
injured
party
for
the
loss
suffered
by
the
tortuous
act
rather
than
punish
the
wrongdoer
and
while
many
torts
have
a
criminal
aspect
to
them
such
as
assault
or
fraud,
tort
law
does
not
normally
attempt
to
do
more
than
provide
compensation
for
injury.
Objective
of
tort
law,
according
to
the
definition,
is
compensation
of
the
victims
and
should
not
engage
in
punishment.
In
tort
law,
one
cant
use
insanity,
intoxication
as
defences.
All
that
is
required
is
intent
children
can
be
liable
for
tort.
Originally tort law was a strict liability there was no element of intent required
To
hold
someone
liable,
they
need
to
be
at
fault:
morally
and
mentally
blameworthy.
They
perpetrated
the
act
that
cause
the
harm
with
intent
or
they
were
negligent
(careless).
(All
but
not
abuses)
2 Categories of Torts:
INTENTIONAL TORTS
Intentional
torts
are:
an
intentional
act
proscribing
intentional
harm;
cannot
be
reflexive
or
defensive;
those
torts
which
are
caused
with
intention.
Reflexive
(like
when
the
doctor
hits
your
knee
with
the
mallet
and
you
kick
him
in
the
face)
84
of
155
Automaton: not as conscious state (ex. If you attack someone while sleep walking)
Torts
usually
follow
the
criminal
court
because
they
tort
prosecutor
will
allow
the
criminal
prosecutor
find
all
the
evidence
and
do
most
of
the
work
in
setting
up
and
then
the
torts
will
take
it
from
there.
There are various types including: the tort of battery, deceit, false imprisonment.
1. Intention
o Motive
is
described
as
the
underlying
objective.
Defendant's
mind
must
prompt
the
bodily
movement
to
create
the
harm
o Intent
is
more
direct
than
motive.
Deals
with
the
immediate
intent
to
cause
harm.
Difficult
for
the
plaintiff
to
address
this.
Intention
is
a
Presumption:
it
is
understood
by
the
court
that
the
defendant
has
the
intent
to
cause
the
harm
and
is
responsible
to
prove
otherwise
and
rebut
it.
You
do
not
have
to
prove
the
element
as
the
plaintiff,
it
is
up
to
the
defendant
to
rebut
it.
85
of
155
The
difficulty
for
the
plaintiff
is
that
it
is
awfully
difficult
to
prove
intention
on
the
part
of
the
defendant.
The
court
aids
this
by
assuming
intention
exists,
that
you
intend
the
naturally
consequences
of
your
act,
therefore
the
plaintiff
doesnt
have
to
prove
the
element
and
it
reverses
the
owness
of
proof.
The
plaintiff
is
taken
to
have
established
the
element
and
proven
it
and
it
is
up
to
the
defendant
to
enter
proof
to
reverse
the
presumption
or
conclusion.
86
of
155
2. Causation
Means
it
must
be
the
operative
cause
(close
in
time
with
no
intervening
acts),
nothing
to
do
with
motive.
The harms for which each individual tort takes its name
Examples:
o Battery (touching),
o Deceit (the false assertion of fact with knowledge of its falsity ) ex. fraud
o False Imprisonment (anyone who intentionally confines another within fixed boundaries),
o Intentional
Infliction
of
Mental
Suffering
-
Wilkinson
Vs.
Downton
Case:
Defendant
told
the
plaintiff
that
her
husband
was
injured
in
a
serious
accident.
Defendant
went
into
shock
and
was
incapacitated
for
several
weeks.
Damages
were
awarded.
If
all
elements
are
proven
then
the
plaintiff
is
entitled
to
a
remedy
to
place
victim
in
the
position
he/she
was
in
had
the
tort
not
occurred.
However
damages
will
not
be
rewarded
if
the
defendant
is
successful
in
proving
that
a
defence
exists
a
defence
is
where
there
is
an
excuse
for
the
defendant
so
that
liability
which
would
normally
result
is
excused
or
conduct
which
would
ordinarily
result
in
liability
would
be
excused
if
a
defence
exists.
- A
defense
is
Absolution:
conduct
that
would
normally
result
in
liability,
the
conduct
is
excused.
All
the
elements
are
present
but
the
defendants
conduct
is
excused,
and
is
absolved
of
any
liability
- Ex.
Of
defense:
consent
(if
you
agree
to
battery,
like
a
fight)
there
are
limits
to
consent,
like
in
a
boxing
match,
the
opposing
boxer
cant
bite
your
ear.
Another
example
of
a
defense
is
self-defense
limit
is
that
it
cannot
be
excessive.
Another
example
is
legal
authority
police
need
to
pat
you
down,
physically
touching
you
which
is
a
battery
but
it
is
excused.
87
of
155
Types of remedy:
1. Injunction:
a
court
order
to
get
the
tort
feasor
to
stop
with
the
persistent
tort
2. The
presentation
of
damages:
compensate
the
injured
party
for
the
harm
suffered
(Tort
laws
damages
objective
is
to
put
the
injured
party
in
the
same
position
they
would
have
been
in
had
the
tort
not
occurred)
There are a variety of excuses which would absolve the defendant from the liability, including:
a) Self
defence
with
extreme
limits
-
no
other
reasonable
way
of
escaping,
has
to
be
reasonable
force,
b) Consent
agree
to
enter
into
an
activity
(ex.
Boxers),
but
there
are
levels
to
consent
so
that
it
cant
be
to
excessive
force,
and,
c) Defence
of
Legal
Authority
some
individuals
are
charged
with
responsibilities
and
as
a
result
they
have
authority
to
perform
acts
that
would
otherwise
be
torts
(ex.
Police),
unless
they
exceed
the
reasonable
force
necessary.
The remedy that is available if there is tort liability is referred to as damages and it is money.
The
purpose
is
to
compensate
the
individual,
to
place
the
victim
in
the
same
position
had
the
tort
not
occurred.
1. Special
Damages
are
those
losses
that
can
be
calculated
with
accounting
accuracy
up
until
a
particular
date,
usually
the
date
of
the
trial
or
date
of
the
judgement,
example,
loss
of
wages,
loss
of
profit
from
business,
medical
expenses.
2. General
damages
losses
that
cannot
be
calculated
with
accounting
certainty;
there
is
a
level
of
conjecture
(estimation).
For
example:
future
medical
costs,
future
income
loss
(ex.
cant
work
for
the
rest
of
your
life,
what
your
wages
would
have
been),
pain
and
suffering
(most
difficult
to
measure,
somewhat
arbitrary,
there
is
no
formula
between
pain
and
money,
people
have
different
pain
thresholds/sensitivity)
look
up
precedence
from
other
cases,
because
they
cannot
be
calculated.
88
of
155
3. Punitive
(exemplary)
damages
are
ordered,
are
discretionary,
and
given
when
the
defendant
is
guilty
of
conduct
that
can
be
described
as
vindictive,
aggravated
or
penal
or
retributory.
Usually
the
defendant
is
acting
in
a
contemptuous
fashion
so
the
behaviour
is
very
bad
and
inappropriate.
They
place
the
injured
party
in
the
same
situation
that
he
or
she
would
have
been
in
had
the
tort
not
occurred.
It
needs
to
relate
to
reckless
behaviour.
Used
to
punish
the
defendant
and
act
as
a
deterrent
for
people
acting
in
this
manner.
WHY
IS
THE
REWARD
MUCH
HIGHER
IN
THE
US
THAN
IT
IS
IN
CANADA?
(EXAM
QUESTION)
I. Pain
and
suffering
rewards
in
Canada
have
been
subject
to
a
limit
by
the
Supreme
Court
in
1982
of
100,000
they
feel
for
the
victims
but
any
reward
is
arbitrary.
Since
then
it
has
been
indexed
to
inflation
and
the
current
maximum
is
roughly
400,000.
Americans
dont
have
a
cap.
II. Juries
make
tort
awards
in
the
United
States;
in
Canada
we
dont
have
a
jury
for
civil
cases,
we
just
use
a
judge.
Juries
tend
to
be
more
emotional
and
as
a
result
will
award
larger
sums,
and
III. Americans
have
jurisprudence
that
allows
for
higher
rewards
of
punitive
damages
that
can
also
be
rewarded
by
the
juries.
Higher
rewards
for
pain
and
suffering
more
frequently.
Punitive
(exemplary)
damages
are
ordered,
are
discretionary,
and
given
when
the
defendant
is
guilty
of
conduct
that
can
be
described
as
vindictive,
aggravated
or
penal
or
retributory.
Usually
the
defendant
is
acting
in
a
contemptuous
fashion
so
the
behaviour
is
very
bad
and
inappropriate.
They
place
the
injured
party
in
the
same
situation
that
he
or
she
would
have
been
in
had
the
tort
not
occurred.
It
needs
to
relate
to
reckless
behaviour.
Used
to
punish
the
defendant
and
act
as
a
deterrent
for
people
acting
in
this
manner.
When
someone
is
liable
in
negligence
they
are
liable
in
having
failed
in
living
up
to
the
required
standard
of
conduct
which
is
applicable
to
all
activities
in
society.
ex.
Not
shovelling
your
drive
way
and
someone
slips
and
gets
hurt
on
it
Negligence
applies
to
every
behavior
or
conduct
in
which
you
can
be
involved.
It
is
potentially
present
everywhere
89
of
155
As
an
employer
you
have
vicarious
liability
for
the
torts
perpetrated
by
your
employees
during
the
course
of
employment
There
are
various
approaches
to
establishing
the
tort
of
negligence,
the
best
is
contained
in
Linden,
who
indicates
there
are
6
elements
required:
1. The defendants conduct must be negligent - in breach of the standard of care set by law.
3. The damage suffered must be caused by the negligent conduct of the defendant,
5. The
conduct
of
the
defendant
must
be
a
proximate
cause
of
the
loss
or
stated
in
another
way,
the
damage
should
not
be
too
remote
a
result
of
the
defendants
conduct,
6. The
conduct
of
the
plaintiff
should
not
be
such
as
to
bar
his
or
her
recovery
-
he
or
she
must
not
be
guilty
of
contributory
negligence
and
he
or
she
must
not
voluntarily
assume
the
risk.
1. The
standard
of
care:
is
that
the
law
places
a
duty
on
every
person
to
conduct
all
activities
taking
reasonable
care
not
to
injure
others
or
their
property.
Whether
a
person
has
acted
with
reasonable
care
is
a
question
of
foresee-ability
of
harm.
If
a
reasonable
person
would
foresee
that
by
failing
to
be
careful
in
his
or
her
activity,
he
is
likely
to
injure
another,
then
he
is
under
a
duty
to
take
due
care.
If
he
or
she
does
not,
that
individual
is
liable
for
the
injury
inflicted.
The
standard
of
care
is
summed
up
as:
whether
a
reasonable
person
would
reasonably
foresee
danger
or
harm
to
another
or
their
property
and
whether
the
steps
taken,
if
any,
to
avoid
this
danger
of
harm
were
reasonably
sufficient.
The
reasonable
person
standard
has
been
increasing
and
it
is
a
very
high
standard;
it
is
not
the
average
person
(the
average
persons
standard
is
pretty
low).
Textbook
definition
of
a
reasonable
person
is
someone
who
is
anticipatory,
always
thinking
of
others,
careful.
There
is
a
clear
bias
to
find
someone
liable
because
the
standard
is
so
high.
The
irony
is
that
sometimes
you
can
anticipate
that
there
is
a
risk
of
harm
and
you
take
measures
to
prevent
it
90
of
155
and
if
those
measures
are
insufficient
you
will
still
be
liable.
Ex.
You
see
ice
on
your
driveway
and
go
put
salt
down
on
your
drive
way,
but
it
isnt
enough
and
someone
slips
and
injures
themselves,
you
are
still
liable.
F
2. There
must
be
some
damage
suffered
by
the
plaintiff
economic
harm
and
intentional
infliction
of
mental
suffering
are
both
recognized
as
types
of
harms
by
negligence
law.
3. Causation
The
accident
must
be
attributed
to
the
act
of
the
wrong
doer.
Fortunately
the
courts
have
not
been
trapped
into
endless
philosophising;
instead
they
have
adopted
a
common
sense
approach.
The
most
common
test
is
the
but
for
test,
sometimes
called
the
sine
qua
non
test.
If
the
accident
would
not
have
occurred
but
for
the
defendants
negligence
then
his
conduct
is
a
cause
of
the
injury.
You
dont
have
to
be
the
cause,
but
you
must
be
a
cause.
4. Duty
of
care:
to
whom
do
we
owe
the
standard
of
care
however
negligent
the
defendant
is,
they
will
not
be
liable
unless
they
owe
a
duty
to
the
other
person.
In
1932
there
was
the
case
of
Donoghue
v.
Stevenson
which
established
the
neighbour
principle
which
clarified
to
whom
we
owe
a
duty,
to
a
limited
extent.
Ratio:
We
owe
a
duty
to
be
careful
to
those
we
can
describe
as
a
neighbour
of
law
-
persons
who
are
so
closely
and
directly
affected
by
my
act
that
I
ought
reasonably
to
have
them
in
contemplation
when
I
am
directing
my
mind
to
the
acts
or
omissions
which
are
called
into
question.
It
has
raised
the
bar
in
terms
of
tort
law.
The
case
was
over
drinking
a
half
a
decomposed
snail
in
a
bottle
of
ginger
beer.
She
wanted
to
sue
the
manufacturer,
not
her
friend,
but
at
the
time
the
manufacturer
didnt
owe
anything
to
the
end
consumer,
only
the
retailers.
The
House
of
Lords
crafted
the
neighbour
principle
that
allowed
persons
to
sue
the
company
(the
case
of
Donahue
v.
Stevenson).
In
tort
law
the
ultimate
consumer
did
not
have
a
contract
with
the
producer
and
thus
could
not
sue
them
in
tort,
however
they
couldnt
blame
anyone
else.
You
used
to
not
owe
a
standard
of
care
to
the
world.
5. Damage
should
not
be
too
remote
a
result
of
a
defendants
conduct
-
the
damage
must
be
a
reasonably
foreseeable
consequence
of
the
act.
Thin
skull
cases
-
situations
where
for
example
an
individual
negligently
strikes
another
person
on
the
job
and
the
individual
has
a
rare
bone
disease
and
their
jaw
bone
completely
shatters.
The
defendant
said
that
they
couldnt
be
responsible,
but
that
if
the
type
of
damage
could
be
expected
then
you
have
to
take
your
victim
as
you
find
them.
Defendant
would
still
be
liable
for
everything.
6. Plaintiffs
conduct
cannot
bar
recovery:
91
of
155
a. Contributory
Negligence:
if
the
individual
contributed
to
their
own
injury
then
the
plaintiff
could
not
succeed,
even
if
they
were
1%
responsible.
Ex.
In
a
car
accident
and
not
wearing
a
seat
belt,
plaintiff
was
100%
responsible
because
they
werent
wearing
their
seat
belt).
Modern
law
has
changed
through
the
contributory
negligence
statute:
wherein
judges
can
allocate
responsibility
and
liability.
For
example,
if
you
are
in
a
car
accident
and
not
wearing
a
seat
belt,
you
are
10%
responsible
for
the
injury.
b. Volenti:
voluntarily
assume
risks
in
certain
hazardous
activities.
Ex.
Playing
hockey,
assume
the
risk
that
an
errant
puck
might
hit
you
in
the
head.
This
element
doesnt
seem
to
be
an
element,
but
actually
a
defence
for
the
tort
of
negligence.
What is a professional?
o Text
book
says:
professionals
are
people
whose
skills
are
described
as
having
a
significant
intellectual
content
and
draw
on
an
underlying
developing
body
of
theory
affecting
the
practice
of
their
profession.
Members
of
each
profession
are
usually
certified
to
offer
their
services
to
the
public
under
a
system
of
licensing
administered
by
one
or
more
governing
bodies
of
the
profession.
Accordingly,
clients
view
professionals
as
having
specialized
knowledge
and
skills
that
they
are
prepared
to
pay
for
and
rely
on.
They
were
created
historically
to
protect
the
consumer,
because
you
want
certain
standards
created
so
that
the
client
knows
they
are
dealing
with
a
credible
person.
As
professionals
there
is
potential
liability.
There
is
a
delegate
body
established
by
statute
in
respect
of
an
occupation
and
members
of
that
delegate
body
are
elected
by
members
of
the
occupation
and
that
delegate
body
creates
subordinate
legislation
relative
to
the
following:
92
of
155
FIVE
BASIS
OF
LIABILITY
(SOME
OF
WHICH
RELATE
PURELY
TO
THE
STATUTES
THAT
CREATE
THE
GOVERNING
ORGANIZATION)
(19;00)
1. Criminal
liability
can
be
held
criminally
for
ones
acts
ex.
Theft.
The
courts
would
deal
with
the
member
and
then
separately
the
delegate
body
would
do
the
take
it
to
their
own
court.
as
well.
2. Professional
liability
in
breach
of
the
code
of
conduct
(delegate
legislation
of
your
professional
body)
and
can
be
disciplined,
which
is
really
violating
regulations,
3. Contractual
liability
whether
explicit
or
implicit
there
is
an
implied
promise
that
the
service
of
the
professional
will
render
their
services
with
due
care
up
to
a
reasonable
standard,
and
any
breach
of
contract
can
be
rewarded
with
damages.
a. Sometimes
you
must
sue
in
contract
because
statute
determines
the
time
that
you
must
issue
a
lawsuit
within
a
period
of
time,
tort
law
2
years
and
contract
law
6
years.
So
this
is
used
usually
as
a
backup
to
the
tort
claims,
because
they
would
have
missed
the
tort
deadline
in
time
for
the
tort
in
court.
b. What
jurisdiction
laws
should
you
follow
if
you
are
dealing
with
multiple
provinces?
Conflicts
of
law
-
in
tort
law
it
is
usually
the
site
of
the
tort,
where
it
occurred;
in
contract
law
it
looks
at
the
proper
law
of
contract.
However,
the
safest
way
is
to
put
it
into
the
contract
which
law
will
govern
the
contract.
DIDNT
TALK
ABOUT
IT
4. Fiduciary
(role
of
a
trustee)
liability
someone
in
a
position
of
trust.
They
have
ascribed
to
them
certain
duties:
b. bona
fides
(good
faith)
ex.
If
they
tell
you
about
a
great
opportunity
they
have,
you
couldnt
snatch
up
that
opportunity
Tort
law
has
been
the
engine
of
liability.
The
usual
basis
of
tort
liability
for
professionals
is
negligence,
not
intentional.
There
is
more
negligence
than
ever
before
because:
b. There
is
a
tendency
now
because
of
economic
pressure
for
professionals
to
take
on
more
clients
and
files
(greater
competition
for
the
same
income),
so
there
is
a
greater
chance
of
error,
and
then
theres
a
greater
chance
that
the
client
will
sue,
d. With the advent of contingency fees, it is much easier to retain a lawyer to sue professionals.
e. The
culture
has
changed,
professionals
were
revered
and
now
they
are
seen
as
normal
people
who
make
errors.
(HE
SAID
THESE)
f. Clients
are
more
sophisticated,
not
willing
to
accept
the
word
of
the
professionals,
and
tend
to
be
more
litigious;
they
are
more
demanding
and
aggressive
towards
professionals,
g. Professionals
now
are
insured
and
theres
a
tendency
for
court
remedies
to
become
inflated
therefore
encouraging
more
litigation.
The
legal
reason
for
the
expansion
of
professional
liability
relates
to
the
application
of
more
liberal
tort
principles
to
professionals.
The
result
is
that
more
professional
will
find
themselves
at
fault
and
held
liable
for
their
errors
in
court.
h. Normal
rules
of
negligence
law
are
now
being
applied
to
professionals
(previously
they
had
exceptions).
solicitor
wrongly
filed
a
will
and
forgot
to
include
a
beneficiary,
and
said
he
was
only
liable
to
the
dead
person,
but
the
prosecution
applied
Donahue
&
Stevenson
iii. Byrne
v.
Heller
-
pure
economic
loss
was
deemed
sufficient
to
ground
a
claim
in
negligence
against
a
professional.
The
only
harm
recognized
previously
was
if
it
was
physical
Historically,
the
basic
rule
with
respect
to
the
standard
of
care:
a
professional
must
exercise
the
same
degree
of
skill
and
possess
the
same
level
of
knowledge
as
is
generally
expected
as
a
members
of
that
profession,
i.e.
he/she
must
live
up
to
the
reasonable
standards
of
that
profession.
People
used
to
be
able
to
say
that
they
screwed
up
in
their
job
trying
to
do
something
above
their
specialties,
and
falling
back
on
saying
that
others
would
do
the
same
with
the
same
skills.
Professionals
would
give
it
the
old
college
try
and
just
try
their
best
and
then
be
able
to
claim
that
it
was
above
their
specialties
and
not
their
fault.
How
do
you
determine
what
a
reasonable
standard
as
a
profession
is?
Based
on
Hodgins
v.
Hydro-electric
Commission
in
the
township
of
Napean
-
there
it
was
stated
by
chief
justice
Glassin
that
sometimes
a
professional
undertakes
a
task
that
is
beyond
the
usually
skills
of
his
professional
practice.
He
cannot
then
fall
back
upon
the
normal
professional
standard.
The
degree
of
skill
and
knowledge
must
be
commensurate
with
the
task
undertaken.
Courts
retain
ownership
over
the
Standard
of
Care.
Contracts
are
the
legal
mechanisms
which
regulate
exchanges.
They
are
the
crucible
of
business
activity.
Contracts
are
entered
into
voluntarily
(but
limited,
practical
definition
of
voluntary
ie.
Cannot
voluntary
do
something
under
duress)
Contracts
create
liability
and
are
the
crucible
of
capitalism
by
reflecting
laissez-faire
philosophy.
Contract
is
an
agreement
enforceable
at
law.
Blacks
law
dictionary
says
that
a
contract
is:
a
promissory
agreement
between
two
or
more
persons
that
creates,
modifies,
or
destroys
a
legal
relation.
A
better
definition
is
from
the
CMA
lesson
notes:
a
contract
is
an
agreement
that
requires
the
mutual
ascent
of
at
least
two
parties
to
do
something
or
conversely,
to
refrain
from
doing
something.
The
parties
then
by
their
mutual
ascent
or
agreement
create
certain
rights
and
duties
that
did
not
exist
in
their
particular
relationship
before
that
point
in
time.
If
these
rights
and
duties
can
be
enforced
by
the
courts
of
law,
the
parties
have
as
between
themselves
created
certain
rules
of
conduct
which
they
are
obliged
to
observe
in
their
actions.
They
have
in
effect
voluntarily
created
legal
obligations
or
laws
governing
their
relationship
for
their
own
purposes.
The
legal
rules
the
parties
must
follow
to
establish
their
own
rights
and
duties
are
called
the
laws
of
contract.
o It indicates that:
2. There are at least two parties or more, there cant be an agreement with yourself,
3. Contracts
must
be
mutually
agreed
upon,
and
the
court
will
enforce
that
contract.
there
is
an
implication
that
there
is
an
exchange,
but
the
exchange
can
almost
be
negative
exchange
with
respect
to
behaviour,
and
4. Idea
that
through
contracts,
as
between
the
parties,
you
can
make
your
own
law.
There
is
a
freedom
to
contract,
you
have
that
freedom
to
create
new
dynamics
in
terms
of
your
relationship,
so
long
as
you
are
not
violating
any
law
or
public
policy
An
exchange
is
considered
a
contract.
In
order
to
create
a
contract
you
need
to
establish
six
elements,
other
agreements
exist
that
arent
contracts
if
the
elements
do
not
all
exist.
These
elements
ultimately,
if
the
contract
is
broken,
have
to
be
established
to
the
balance
of
probability.
96
of
155
Contracts
define
the
dynamics
of
the
relationship
between
the
parties.
They
elevate
the
relationship
to
law.
Certainty:
important
part
of
contract
law
as
we
are
dealing
with
money.
It
is
the
most
important
precept
in
contract
law.
It
often
trumps
justice
and
fairness
as
we
will
see
later
in
notes:
1. Offer
2. Acceptance
3. Consideration
4. Capacity
5. Intention
to
Create
Legal
Relations
6. Legality
of
the
Contract
1. THE OFFER
Textbook
defn:
An
offer
is
a
tentative
promise
made
by
one
party,
the
offeror,
subject
to
a
condition
or
containing
a
request
to
the
other
party,
the
offeree.
When
the
offeree
accepts
to
offer
by
agreeing
to
the
condition
or
request,
the
offer
is
transformed
into
a
contract.
The
promise
is
no
longer
tentative:
the
offeror
is
bound
to
carry
out
his
promise
while
the
offeree
is
bound
to
carry
out
the
condition
or
request.
Silly
definition,
but
some
things
can
be
taken
from
it:
o The person who makes the offer is the offeror, the recipient is the offeree
The contract metamorphoses from the offer; when the offer is accepted you have a contract.
The
offer
is
the
contract
in
draft.
If
there
is
an
acceptance
you
are
bound,
so
must
think
about
it
carefully.
There
is
not
much
that
can
be
done
to
get
out
of
the
contract
once
the
offer
has
been
accepted.
97
of
155
The
distinction
between
an
offer
and
the
invitation
to
do
business
(i.e.
the
invitation
to
elicit
an
offer)
1. Through
advertisements;
stores
are
making
invitations
to
elicit
an
offer
from
you
at
that
price
which
they
then
will
accept.
(EXAM
Question)
(51:00)
The
case
of
Pharmaceutical
Society
of
Great
Britain
v.
Boots
Cash
Chemist
stands
in
the
propositions
regarding
displays
in
stores
and
advertisements
in
the
newspaper.
They
came
to
the
conclusion
for
policy
reasons
rather
than
logic.
There
would
be
too
many
cases
otherwise
and
would
clog
the
courts.
They
decided
that
the
mere
fact
that
a
customer
picks
up
a
product
from
the
shelves
in
this
case
doesnt
amount
to
an
acceptance
of
an
offer
to
sell.
It
is
an
offer
by
the
customer
to
buy,
and
there
is
no
sale
until
the
buyers
offer
to
buy
is
accepted
by
the
acceptance
of
the
price.
This
was
created
for
certainty
and
efficiency.
The
decision
is
that:
Advertisements
are
invitations
to
elicit
an
offer
(ie.
Any
item
in
the
store
with
a
price
tag
on
it).
The
consumer
is
making
the
offer
by
picking
up
an
item
with
the
price
tag
on
it.
It
is
illogical
but
the
conclusion
was
decided
on
in
order
to
ensure
certainty.
When an offer lapses, it is not accepted. It may lapse for a number of reasons:
1. The offeree fails to accept the offer within the time specified in the offer,
2. When
the
offeree
fails
to
accept
the
offer
in
a
reasonable
time
if
the
offeror
has
not
specified
any
time
limit
(NOTE:
always
time-limit
your
offer
dont
leave
it
up
to
the
judge!),
3. An offer lapses when any of the parties dies or becomes insane prior to acceptance.
Revocation
Principles:
an
offeror
may
revoke
(withdraw)
an
offer
at
any
time
before
acceptance
even
when
it
has
been
promised
to
hold
the
offer
open
for
a
specified
time.
There
are
two
ways
to
keep
an
offer
open
and
enforceable:
2. If
an
option
contract
is
created
a
contract
whereby
someone
promises
to
keep
the
option
open
for
agreement.
o If offeree rejects the offer, it is terminated. Can now only revise it.
A
volley
of
offer
or
counter
offer
usually
when
contractual
agreements
take
place
there
is
bargaining
that
takes
place;
there
is
a
volley
of
offers
going
back
and
forth.
o An
offer
by
one
side
must
be
unqualifiedly
accepted
by
the
other
side
of
all
the
terms
without
variation.
o If
you
vary
one
term
then
you
do
not
have
an
acceptance
even
if
they
say
it
is
accepted.
o All
terms
should
be
understood
when
an
offer
is
put
forward
and
the
offeree
though
interested
varies
some
features,
this
is
not
an
acceptance
but
a
counter
offer.
o Further
the
original
offer
does
not
revive
if
the
counter
offer
in
turn
is
also
rejected,
the
offeree
can
accept
the
former
offer
only
if
the
offeror
agrees
to
renew
it.
2)
An
offer
cannot
be
accepted
by
the
offeree
until
he/she
has
first
learned
of
it
(cant
be
forced
into
a
contract
by
people
who
do
work
for
us
without
our
knowledge)
In
order
for
an
offer
to
exist,
the
offer
must
be
okayed
by
the
offeree.
An
offeree
cannot
accept
an
offer
that
has
not
been
communicated
to
the
offeree.
There
also
needs
to
be
cognition
of
the
communication
by
the
offeree
A
contract
used
repeatedly
usually
for
a
repeated
provision
of
a
service
or
product
stating
limitations
of
liability
clauses
and
insurance
clauses.
The
general
public
is
presented
through
the
terms
of
the
contract
and
they
can
take
it
or
leave
it
and
there
is
no
negotiation
Courts
didnt
like
them
because
of
the
absence
of
bargaining
between
the
parties,
but
also
because
of
the
providers
of
the
service
want
to
insert
exemption
of
liability
clauses.
99
of
155
The courts created exceptions called standard form contracts to help the consumers.
The
principles
the
courts
devised,
important
especially
in
relation
to
the
exception
of
liability
clauses,
says
that
if
the
person
does
not
know
of
the
terms
of
the
contract
he/she
cannot
be
bounded
by
it
unless
reasonable
steps
were
taken
to
bring
the
contractual
terms
to
his/her
attention.
The
courts
wanted
the
public
to
be
aware
of
the
terms
of
the
contracts.
Contra
preferentum
the
courts
read
the
contract
against
the
interest
of
the
party
that
created
it,
if
two
interpretations
are
possible.
Applies
when
contracts
are
ambiguously
written.
See
fundamental
breach
re:
standard
form
contracts.
1. Rejection:
Offeree
rejects
and
terminates
the
offer.
Reject
the
offer
with
care,
as
it
may
be
the
only
offer
youll
get
as
it
is
generally
offensive
to
the
offeror.
2. Counter-offer:
A
response
to
an
offer
where
you
vary
one
or
more
terms.
Amounts
to
the
rejection
and
termination
of
the
original
offer.
Better
to
illicit
information,
and
have
the
offerer
amend
their
offer
in
your
favour.
3. Lapse:
an
offer
lapses
(is
no
longer
open
for
acceptance)
if:
a. The
offeree
fails
to
accept
within
the
time
specified
in
the
offer.
b. The
offeree
fails
to
accept
within
a
reasonable
time
if
no
time
is
specified.
c. One
of
the
parties
dies
or
goes
insane
prior
to
acceptance.
4. Revocation:
A
withdrawl
of
the
offer
by
the
offeror
which
prevents
its
acceptance.
It
must
be
communicated
to
the
offeree
in
order
for
the
revocation
to
be
effective.
The
communication
must
be
by
the
offeror
or
by
some
reliable
source.
Revocation
by
mail,
to
be
effective,
need
only
arrive
at
the
address
of
the
offeree,
unless
the
offeree,
knows
or
ought
to
know
the
revocation
will
not
reach
the
offeree
at
that
address.
The
offeree
must
communicate
acceptance
to
the
offeror.
Communication
means
perception
and
cognition.
100
of
155
Communication rules:
1) Offeror
in
general
has
full
control
over
the
mode
and
method
of
acceptance
and
therefore
can
state
the
required
methods
of
communications
of
acceptance
and
invalidate
or
prohibit
others
specifically
the
offeror
can
require
actual
receipt
by
mail
or
any
mode
requirement
or
alternatively
can
require
a
performance
of
an
act
instead
of
an
acceptance.
a. Carlyle
vs.
Karbolic?
the
smoke
ball
case:
If
you
do
the
act,
you
have
essentially
accepted
the
contract.
The
offeror
states
what
constitutes
acceptance.
Performance,
in
this
case,
was
sufficient.
b. This
puts
the
power
in
the
offeror,
in
terms
of
mode
and
method
of
acceptance.
This
is
useful
because
then
you
control
the
organization
of
your
firm
and
run
you
affairs
the
way
you
would
like.
2) An
offeror
will
not
be
bound
unless
and
until
he
or
she
receives
the
acceptance
and
before
he
or
she
revokes
.
Here
you
need
actual
knowledge,
and
prior
to
the
offer
lapsing.
a. Two exceptions:
i. The
mail
exception
when
an
offeror
chooses
the
mail
as
the
means
of
acceptance
then
the
mail
exception
applies.
The
acceptance
is
effective
when
and
where
the
mail
is
deposited
in
the
mail
box;
when
a
properly
addressed
and
stamped
letter
is
place
in
the
mail,
i.e.
the
time
of
mail,
applies
when
the
mail
is
a
reasonable
response
otherwise
it
is
the
time
of
receipt
of
the
letter,
that
should
be
actual
receipt.
If
in
the
context
the
mail
would
be
reasonable
then
it
will
be
the
method
of
acceptance;
also
if
the
offeror
states
a
preference
for
mail
service
it
again
will
be
the
method
of
choice.
You
dont
need
actual
knowledge
/
cognition
in
this
circumstance.
A
contract
and
therefore
its
preceding
offer
must
be
certain
in
its
wording,
it
cannot
be
vague
or
it
will
be
void.
Cant
have
vague
terms,
the
language
must
be
precise.
Sometimes
there
is
an
agreement
to
agree,
it
is
uncertain
and
makes
the
contract
uncertain.
You
can
have
a
formula
or
an
arbitrator
to
make
the
decision
but
not
an
agreement
to
agree.
A
quality
of
the
offer.
For
example,
in
buying
something,
the
price
cannot
be
listed
as
TBD
Courts
are
generally
inclined
to
accept
interpretations
to
contracts
because
they
want
to
fulfill
their
objective
intent.
1. The
offeror,
in
general,
has
full
control
of
the
method
of
acceptance.
Therefore,
can
state
the
method
of
acceptance
and
invalidate
or
prohibit
others.
Can
state
methods
of
acceptance
and
prohibit
others
(ex.
Reqd
actual
receipt
by
mail)
2. If
offeree
selects
mail,
mail
exception
applies.
Acceptance
is
only
effective
when
and
where
it
is
deposited
(in
Manitoba)
3. If
offeror
merely
states
a
preference
for
a
mail
or
a
postal
service
is
a
reasonable
means
of
communicating
acceptance,
because
it
was
used
or
suggested
by
the
offeror
and
acceptance
is
effective
when
and
where
it
was
deposited
in
the
mailbox.
4. If
some
other
method
other
than
post
is
stated
as
preferred
(ex.
Phone,
email,
in
person),
offeree
may
still
accept
by
post
but
offeror
is
not
bound
unless
and
until
acceptance
reaches
offeror,
and
prior
to
offers
lapse
there
must
be
actual
knowledge
of
it,
and
not
just
mailed.
a. Law
of
contract,
in
general,
is
in
place
where
offeror
learns
of
acceptance,
subject
to
other
principles.
3. CONSIDERATION (17:00)
Consideration
is
the
essence
of
the
contract
because
contracts
are
ultimately
an
exchange
or
bargain.
Each and every party to a contract, for it to be valid, must give up consideration.
Consideration
is
the
price
for
which
the
act
or
other
party
is
bought.
So
long
as
the
promisor
bargains
for
the
other
party
to
do
something
or
to
promise
to
do
something
that
they
otherwise
would
not
do,
the
promisor
will
have
received
consideration.
Consideration
is
the
price
for
which
the
promises
or
act
or
property
of
the
other
is
bought.
1. Property
a. Personal
Property
(things
that
arent
real
estate):
2
types
i. chattels
anything
tangible
and
ii. choses
in
action
intangible
a
right
to
sue.
The
usual
type
of
choses
in
action
is
a
contractual
right
1. Transfer
of
a
choses
in
action
it
is
called
an
assignment.
b. Real
property
(i.e.
land)
2. Services
ex.
Labour,
restraint
on
behavior
(ex.
non-compete
clause)
3. Money
(sort
of
property,
but
seems
to
stand
alone
now)
Most
large
transactions
usually
are
not
immediate,
its
in
the
future
and
usually
what
is
being
exchanged
is
the
promise
for
the
future
delivery
of
things.
GRATUITOUS PROMISE
A
promise
without
a
returning
consideration
is
gratuitous
and
not
enforceable
by
laws
of
contract.
There
needs
to
be
an
exchange
made
of
some
sort.
103
of
155
1) Past consideration
a. When
party
A
is
bound
by
the
existing
contractual
duty
to
party
B,
a
later
promise
by
B
to
pay
A
something
extra
to
perform
the
same
obligation,
is
not
binding.
b. This
makes
commitments
clear
and
prevents
extortion
in
respect
to
abandonment
of
the
contract.
It
gives
certainty
c. The
usual
common
law
contract
that
established
this
principle:
sailors
would
be
hired
to
make
a
transport
trip
and
then
decide
later
that
they
want
to
increase
their
pay,
the
captain
agrees,
but
later
he
only
pays
them
the
original
amount.
If
the
sailor
promises
to
do
another
duty
then
the
sailor
would
have
to
be
paid
higher.
If
the
sailor
just
wanted
to
get
paid
and
not
work
then
they
would
have
to
use
a
nominal
form
of
consideration:
small
amount
of
money,
ex.
$1,
a
peppercorn,
the
seal
(stamp).
Captains
promise
becomes
gratuitous
as
the
sailors
were
doing
no
additional
work
and
had
already
agreed
to
do
the
work
under
the
contract
they
originally
had.
Say
the
sailor
performs
additional
work
or
agrees
to
work
an
extra
ten
minutes
a
day,
then
the
contract
would
be
binding.
d. Seal: the traditional form of nominal consideration (ie. Wax sealing a letter)
i. Nominal
(token)
forms
of
consideration
are
sufficient
for
common
law.
Giving
a
dollar
or
a
seal
to
confirm
iii. The
individual
who
gives
the
seal
is
understood
to
have
given
consideration,
and
any
gratuitous
promises
signed
by
the
offeree
are
binding.
If
the
sailors
had
the
captain
sign
a
document
with
the
increase
in
pay
with
the
seal
after
their
name,
it
would
have
converted
the
gratuitious
promise
into
enforceable
agreements.
You
convert
a
gratuitous
contract
into
an
enforceable
agreement
through
one
of
these
methods.
Courts
do
not
investigate
the
consideration,
but
just
the
fact
that
it
exists.
Equity
investigates
if
the
consideration
is
substantial.
a. The
ratio
of
that
case
is
that
a
creditors
gratuitous
reduction
of
debt
for
a
payment
is
not
enforceable.
The
reason
is
no
consideration
was
exchanged.
In
Foakes
&
Beer,
Foakes
owes
Beer
$2,000
due
to
decision
on
a
previous
court
case
(essentially
a
contract),
and
parties
agree
that
if
Foakes
pays
Beer
$500
at
once
and
gives
the
remainder
of
the
principal
in
instalments,
Beer
would
forgive
the
interest
on
the
debt.
After
the
$2000
has
been
fully
repaid,
Beer
brings
suit
again
Dr.
F,
alleging
that
the
agreement
to
forgive
interest
was
entered
without
consideration,
since
the
consideration
consisted
only
in
Foakes
doing
what
he
was
already
bound
to
do
in
paying
the
principal
of
the
debt.
-
-
Debt
repayment
is
not
a
valid
consideration.
It
is
something
Beer
was
already
obligated
to
do
under
law.
The
partial
payment
of
a
debt
is
not
consideration,
therefore.
The
person
who
was
lent
the
money
must
use
some
form
of
nominal
consideration
to
cover
their
butt;
seal
the
contract,
make
the
payment
a
day
or
two
early.
Its
not
the
seal
itself
that
has
consideration
but
that
the
other
party
has
given
up
consideration.
i. The
rule
in
Foakes
and
Beer
has
been
somewhat
replaced:
If
the
creditor
takes
a
gratuitous
reduction
of
payment
(accepts
a
lesser
sum)
then
he
is
not
able
to
collect
the
remaining
balance
after.
In
order
to
have
a
contract
there
has
to
be
the
intention
on
the
part
of
both
parties
to
be
legally
enforceable
agreement.
The
law
presumes
that
it
exists.
The
plaintiff
does
not
have
to
prove
this
step;
it
is
up
to
the
defendant
to
rebut
their
existence.
The presumption is most easily refuted in family situations and close relations
o Example,
your
mother
invites
you
over
for
dinner
and
promises
to
make
the
meal,
but
you
cant
come
for
dinner
because
you
have
other
plans.
Your
mother
sues
you;
there
is
an
offer
made
by
the
mother,
there
is
acceptance,
the
consideration
on
the
mothers
part
is
a
promise
to
make
the
meal,
and
the
son
promises
to
show
up
for
dinner.
It
is
up
to
the
son
to
rebut
the
presumption
that
there
was
intention
to
create
legal
consequences.
o Instead,
the
son
needs
to
borrow
money
from
his
mother,
20
years
later
the
mother
wants
to
retire
and
needs
the
money.
The
mother
takes
him
to
court,
but
the
son
could
say
that
it
was
more
of
a
gift
because
it
was
around
the
birthday
time.
If
you
are
the
borrower
you
want
to
keep
the
situation
very
informal.
With
this
element
and
when
money
is
involved,
it
is
better
to
be
stricter
when
dealing
with
family
than
strangers,
as
the
presumption
is
more
easily
rebuttable
that
the
intent
was
to
form
a
legally
binding
contract
in
family
matters.
We
see
this
issue
come
up
in
family
businesses
or
where
family
is
employed
or
when
money
is
leant
between
family
members
5. CAPACITY
Capacity is the ability (mental competence) of the parties to bind him or herself in contract.
Each
party
to
the
contract
must
have
capacity;
mental
competency;
able
of
assessing
the
consequences
of
making
a
contractual
promise
that
will
create
enforceable
rights
and
obligations.
There
are
various
types
of
limited
capacity;
the
contract
isnt
void
but
voidable.
106
of
155
A
contract
is
voidable
against
the
minor
but
is
enforceable
against
the
other
side.
Also, a minor can sue you but you cant sue them.
Exceptions:
minors
must
only
pay
a
reasonable
price
for
necessaries
(things
necessary
for
life,
ie.
Food,
water,
shelter,
clothing),
but
they
need
not
pay
the
contract
price,
based
on
Quantum
Meriut
bases
(reasonable
price)
as
assessed
by
the
court.
Minors
also
can
go
into
beneficial
contracts
of
service,
basically
apprenticeship.
Employment
contracts
by
statutes
are
now
allowed:
to
get
work,
16
and
over
can
get
into
labour
contracts;
15
can
do
so
with
guardian
and
principal
consent.
The
insane
and
drunkards.
contracts
can
be
avoided
if,
after
they
retain
sanity
or
sobriety,
they
promptly
repudiate
the
contract.
If
they
wait,
the
contract
will
not
be
void.
The
object
of
the
contract
must
be
legal.
In
essence
the
contract
and
or
any
of
the
activities
contemplated
there
under
or
any
of
its
terms
cannot
offend
public
policy
(courts
view
of
what
is
appropriate
for
society
and
will
not
enforce
any
contracts
inappropriate
for
society)
or
violate
any
law
(statutory,
subordinate
legislation
or
common
law
principle).
There
is
a
presumption
that
is
does
not
violate
any
law
nor
offend
public
policy.
If the presumption is wrong the contract is void and illegal meaning that it was never formed at all.
o If
VOID,
court
assists
parties
to
prior
positions
(ex.
Guy
gets
his
car
back
and
other
guy
gets
his
money
back)
107
of
155
o If
VOID
&
ILLEGAL,
court
will
refuse
any
assistant
to
any
party
who
has
knowingly
agreed
to
an
illegal
purpose
They
can
be
illegal
by
common
law
or
public
policy
philosophy
by
the
court,
for
example
prostitution.
Restraint of Trade
Free
open
market,
is
the
optimal
situation
in
our
economy.
So
they
do
not
like
to
enforce
it,
because
it
diminishes
competition.
(The
Non-Competition
Clause)
Contracts
which
restrain
free
trade
are
struck
down
as
violating
public
policy
Non-employment
clauses
are
sometimes
used
in
situations
where
the
courts
wont
strike
it
down:
o however
it
is
sometime
seen
in
business
relations
such
as
employment
contracts
as
you
dont
want
employees
going
and
starting
a
competing
company
after
youve
trained
them
or
they
have
access
to
confidential
information,
o or
in
contracts
with
suppliers,
partners
or
customers
who
have
access
to
your
intellectual
property
or
other
sensitive
info
o The
non-competition
period
must
be
well
defined;
time-limited
and
geographically-limited
to
what
is
reasonable
and
necessary
Some contracts are illegal because the particular activity offends a statute
To impugn a contract (assault, impeach, attack) means you are attacking its integrity.
As
between
the
plaintiff
and
the
defendant,
the
defendant
is
the
one
who
wants
to
impugn
the
contract,
because
they
are
the
ones
needing
to
avoid
it.
o They
want
to
attack
the
contract
because
the
plaintiff
is
suing
the
defendant,
but
if
the
defendant
can
come
to
the
conclusion
that
the
contract
was
not
valid
then
they
wouldnt
be
sued.
108
of
155
There
are
various
grounds
to
impugn
the
contract.
If
the
contract
is
valid
then
the
plaintiff
will
be
successful,
however
the
defendant
will
be
successful
if
they
can
prove
that
the
contract
is
void,
voidable
or
unenforceable.
109
of
155
VOID CONTRACTS:
Text
says:
To
decide
that
a
contract
is
void
is
to
say
it
was
never
in
law
formed
at
all,
in
this
sense
calling
an
agreement
is
a
contradiction
of
terms.
If
it
is
void
there
is
no
contract.
o Once
said
to
be
a
void
contract,
there
will
be
no
transfer
of
title
or
property,
and
party
A,
the
vendor
would
receive
the
title
back.
The
consequence:
the
key
point
or
effect
is
that
a
party
to
a
void
contract
can
apply
to
the
court
for
the
return
of
any
property
transferred
under
the
agreement.
Title
or
ownership
of
the
property
at
common
law
would
not
pass
and
cannot
pass
under
a
void
contract
and
the
holder
of
the
title
would
be
in
a
position
to
recover
the
goods
even
if
they
had
been
transferred
to
a
subsequent
third
party
for
value
who
was
innocent.
o Your
typical
void
contract
is:
as
between
party
A
and
B,
no
title
is
passed
(as
the
contract
is
void)
and
A
can
always
re-obtain
the
good
from
party
B
(the
rogue:
thief).
The
issue
then
becomes,
what
happens
if
B
has
transferred
or
sold
the
car
to
an
innocent
third
party
for
value?
A
can
obtain
it
from
C
or
if
there
is
a
D,
E,
F,
or
G,
A
can
always
get
it
back.
C
can
sue
B,
but
often
B
will
have
run
away
with
the
money.
Missing an element
Uncertainty (relating to the offer and the absence of capability being accepted)
111
of
155
VOIDABLE CONTRACTS:
In
response
to
the
unfairness
of
void
contracts,
equity
law
came
in
and
created
voidable
contracts
which
would
be
supplementary
to
the
common
law,
because
they
would
not
deem
the
contract
void.
Equity
recognized
new
considerations
of
fairness.
Under
voidable
contracts,
C
will
generally
triumph.
o Party
C,
the
ISTP4V,
would
not
be
wanted
to
be
made
taken
advantage
of
and
would
end
up
with
the
property
in
the
end;
the
losses
would
stay
as
they
after
the
contract
would
be
deemed
voidable.
The
party
B
can
still
pass
title
to
other
third
parties
for
value,
when
the
contract
is
voidable,
but
A
can
stop
this
by
rescinding
the
contract.
(it
is
not
a
void
contract
until
it
is
rescinded)
o Remains
in
force
until
it
is
declared
otherwise,
title
may
pass
under
it
from
one
to
one
contracting
party
to
the
other.
The
recipient
of
the
title
may
then
transfer
this
title
to
an
innocent
third
party
for
value,
and
that
is
can
obtain
good
title
to
the
goods.
Even
though
the
requiring
title
holder
by
means
the
initial
contraction
voidable.
The
voidable
contract
in
contrast
to
the
void
contract
is
important
where
a
misapprehension
or
misrepresentation
would
render
it
unfair
if
the
contract
terms
were
enforced
against
him
or
her.
So to get a voidable contract rescinded (or made void) one needs to:
o It
is
ultimately
a
remedy,
and
it
is
declared
by
the
court
to
be
rescinded.
It
takes
some
time
to
get
it
done
because
it
goes
through
the
whole
litigation
process.
o It
can
be
done
informally
by
communicating
that
the
contract
is
rescinded
and
sending
them
a
notice
of
it.
It
is
void
then
and
there.
o But
equity
is
to
make
up
the
deficiencies
of
common
law
and
developed
other
circumstances
to
void
the
contract.
112
of
155
o The point is that the seller has a shot at getting the good back.
This
distinction
between
void
and
voidable
contract
is
specifically
important
when
an
innocent
subsequent
third
party
for
value
is
involved.
o Void
agreements:
no
title
passes
and
consequently
an
ISTP4V
cannot
obtain
a
good
title
from
a
person
that
obtained
the
goods
under
a
void
agreement.
o Voidable
contracts:
will
remain
enforced
until
it
is
declared
otherwise
(rescission).
Title
may
pass
under
it
from
one
contracting
party
to
the
other.
The
recipient
of
the
title,
may
then
transfer
the
title
to
an
innocent
third
party
and
the
innocent
third
party
may
obtain
a
good
title
to
the
goods
even
though
the
intermediate
title
holder
acquired
the
title
by
means
that
render
the
initial
transaction
voidable.
Equity
took
a
broader
view
to
fairness;
party
A
is
viewed
as
the
party
that
could
have
stopped
this
contractual
problem
of
occurring
so
they
prefer
party
C.
They
also
use
more
liberal
grounds
to
impugn
a
contract
which
helps
party
A.
Where
a
contract
concerns
the
two
original
parties
it
may
not
matter
whether
the
contract
is
void
or
voidable,
in
either
event
the
court
may
reward
the
property
back
to
the
original
party,
If
the
property
has
been
transferred
to
an
ISTP4V
the
individual
may
recover
it
only
when
the
contract
is
void.
Party
A
can
prevent
property
from
passing
if
the
voidable
contract
is
rescinded
prior
to
the
ISTP4V
obtaining
an
interest
in
it.
If
A
can
rescind
a
voidable
contract
before
C
obtains
an
interest
in
it,
then
property
will
not
pass
to
C.
Rescission
means
setting
aside
a
contract.
How
do
you
rescind
(set
aside)
a
contract?
Get
a
court
order,
the
problem
with
that
is
it
takes
a
long
time
to
obtain.
Other
option:
You
are
better
off
simply
notifying
the
second
party
that
you
are
rescinding
the
contract.
The
text
book
talks
about
title
which
means
ownership.
VOID
1) Missing one of the 6 common law elements or uncertainty relates to an offer being vague
2) Non
est
factum
is
a
narrow
ground,
which
has
to
do
with
old
medieval
grounds
and
translated
means
not
my
doing.
a. Originally
individuals
could
be
fooled
to
enter
into
written
contracts
when
they
were
not
literate
or
they
would
be
misled
to
what
is
the
nature
of
the
written
document.
There
were
attempts
to
broaden
this
to
be
a
misrepresentation,
those
efforts
failed
and
the
House
of
Lords
return
them
to
their
original
basis
for
illiterate
individuals
3) Mistakes
usually
an
error
in
judgement,
perception,
calculation
or
recall.
It
is
very
difficult
to
make
sense
of
how
the
law
deals
with
mistakes.
Very
few
mistakes
are
recognized
by
the
courts
to
render
a
contract
void.
i. Mistake
of
identity
thinking
that
you
are
selling
to
someone
else
(identity
fraud)
for
example
the
woman
sold
her
car
to
someone
she
thought
was
a
movie
star.
ii. Mistake
as
to
subject
matter
is
more
difficult
you
believe
that
you
are
selling
something
different
then
what
the
other
person
thinks
they
are
getting.
Not
really
a
mistake,
more
like
the
offer
is
uncertain.
b. Others
are
held
voidable:
mistakes
to
terms
of
the
contract
or
even
subject
matters
where
one
party
knows
but
the
other
is
unaware
of
its
existence
or
meaning.
One
party
is
aware
of
the
error
of
the
other
party.
Its
akin
to
misrepresentation.
a. The
courts
are
satisfied
that
there
was
a
complete
agreement
between
the
parties,
free
from
ambiguity
and
not
conditional
on
further
adjustments,
b. The
parties
did
not
engage
in
further
negotiations
to
amend
the
contract,
114
of
155
c. The
change
in
the
written
document
appears
to
be
an
error
in
recording
and
is
most
easily
explicable
as
such.
VOIDABLE (22:15)
1) Misrepresentation can occur both inside and outside contractual situations, for example in tort law.
Within the context of contracts there are two possible type of misrepresentation:
1. Those
manifested
inside
the
contract
(You
buy
a
car
and
say
that
it
can
only
have
travelled
100,000
miles
but
find
out
later
that
it
has
200,000
miles)
and
2. Those that are outside the contract but that induce the party to enter into the contract.
Fraudulent
for
both
these
two
you
can
be
rewarded
tort
damages.
There
is
a
trend
in
the
decision
where
courts
are
finding
that
these
misrepresentations
are
actually
terms
of
the
contract.
a) Opinion
vs.
fact:
misrepresentation
based
on
only
false
assertion
with
facts
is
voidable;
misstatements
of
opinions
are
not
voidable.
Because
you
have
to
understand
the
nature
of
the
misrepresentation,
a
misrepresentation
is
a
false
assertion
relating
to
statements
of
face
whereas
mere
statements
of
opinion
are
not
misrepresentation
and
afford
no
remedy.
I.e.
claiming
to
have
the
best
burger
in
Winnipeg
(which
is
opinion)
just
be
careful
not
to
say
its
worth
something
or
that
it
has
a
certain
value,
as
then
you
are
encroaching
on
fact
territory
a) Contained
in
the
contract
breach
of
the
contract
and
is
an
easy
law
suit,
because
they
havent
lived
up
to
the
term
of
the
contract
and
there
is
a
tendency
of
the
court
to
find
created
ways
to
make
misrepresentations
part
of
the
contract.
115
of
155
b) Not
a
term
of
the
contract
but
rather
a
representation
that
has
induced
an
individual
to
enter
into
the
contract.
It
is
determined
by
the
objective
test,
the
reasonable
person
standard.
If
the
answer
is
yes,
then
the
contract
is
voidable.
It
depends
on
the
misrepresentation,
a. If
it
is
an
innocent
misrepresentation
the
party
believed
that
the
information
was
true,
then
it
can
be
rescinded,
or
The
idea
of
CAVEAT
EMPTOR
(34:40)
(buyer
take
care)
-
a
buyer
of
goods
must
take
them
with
their
defects
unless
some
fact
about
their
quality
has
been
misrepresented.
The
purchaser
needs
to
do
the
research
and
investigate
to
find
out
more
about
the
product.
Its
not
opposed
to
misrepresentation.
Misrepresentation
is
about
a
fact,
unless
from
an
expert
opinion.
Unless
it
is
mentioned
in
the
contract,
there
can
be
no
remedy
awarded
for
apparent
misrepresentation.
Contracts
of
utmost
good
faith
(uberimma
fides):
there
is
duty
for
one
to
give
full
details
about
a
purchase
which
is
reverse
of
caveat
emptor.
Places
greater
owness
on
one
party
and
makes
failure
to
give
information
tantamount
to
a
misrepresentation.
Required
in:
1. Contract
of
insurance:
the
purchaser
needs
to
give
all
the
information
about
the
health
and
other
pertaining
info
to
the
insurer.
2. Securities
contract:
all
relevant
information
is
needed
to
be
given.
Doctrine
of
Merger:
States
that
warrants
cease
to
exist
after
closing
so
we
must
create
a
clause
to
correct
this.
1. Innocent
2. Negligent
3. Fraudulent
The
domination
of
one
part
over
the
mind
of
the
other
to
such
a
degree
as
to
deprive
the
latter
of
the
will
to
make
an
independent
decision.
The
contract
formed
as
a
result
of
undue
influence
is
voidable
at
the
option
of
the
victim.
The
victim
may
only
avoid
the
contract
if
he
or
she
acts
promptly.
If
he
or
she
acquiescence
or
delays
hoping
to
gain
some
advantage,
the
court
will
deny
assistance.
1. Prove
that
there
is
a
special
relationship
between
the
victim
and
the
dominator
based
on
special
knowledge
and
skill
causing
the
victim
to
place
confidence
or
trust
and
care
in
the
dominator.
For
example,
a
stock
broker,
family
members,
lawyer-clients,
banker-client,
accountant-client,
homecare
workers.
2. The
party
alleging
undue
influence
must
satisfy
the
court
that
the
circumstances
were
such
that
the
domination
was
probable.
If
element
1
was
proven
this
is
usually
simple
to
establish.
3. Reversal
of
the
burden
of
proof.
If
both
1
and
2
exists,
the
burden
then
shifts
to
the
dominant
party.
If
the
contract
is
to
be
salvaged
the
dominant
party
must
then
prove
that
undue
influence
was
not
exerted
by
him
or
her.
iii. Check
if
there
was
independent
legal
advice
(ex.
This
is
why
your
stock
broker
tells
you
that
you
should
get
independent
legal
advice,
to
make
sure
the
contract
is
bullet
proof)
3)
Duress:
illegitimate
pressure.
Various
types
will
render
the
contract
voidable,
for
example,
threatening
physical
force
or
actual
exertion
of
physical
force
or
economic
duress
which
is
very
narrowly
defined.
Rectification
1. The
court
must
be
satisfied
agreement
between
the
parties,
free
from
ambiguity
2. The
parties
did
not
engage
in
further
negotiation
to
amend
the
contract
117
of
155
3. The change in written document appears to be error in recording and easily explicable in such.
Unenforceable contracts include other arguments that defendants can use to impugn a contract.
The
Statute
of
Frauds:
was
passed
in
1677
by
the
English
parliament
and
it
was
designed
essentially
to
ensure
that
frauds
were
not
perpetrated
through
the
lack
of
sufficient
written
evidence
of
the
contract.
It
established
that
some
types
of
contracts
have
to
be
in
writing.
The
English
parliament
developed
this
requirement
so
that
there
would
be
less
lying
and
there
would
be
less
fraud
(therefore,
greater
certainty).
Its
everywhere
else
in
Canada
except
in
Manitoba
and
BC.
However
you
should
know
this
still
in
case
you
move
or
are
dealing
with
other
jurisdictions.
Written
evidence
would
make
more
certain
that
the
liars
would
not
win
the
cases.
(EXAM
QUESTION)
THE
STATUTE
OF
FRAUD
INDICATES
THAT
CERTAIN
TYPES
OF
CONTRACT
ARE
UNENFORCEABLE
BECAUSE
THEY
ARE
NOT
IN
WRITING.
WHAT
ARE
THE
TYPES
OF
CONTRACTS
THAT
ARE
AFFECTED:
a) Promise
by
an
executor
or
administrator
of
an
estate
of
a
deceased
person
to
answer
for
damages
out
of
his
or
her
own
estate,
The
identity
of
the
parties,
the
subject
of
the
consideration,
possession
date
include,
must
be
signed
by
the
parties,
but
doesnt
have
to
be
in
one
document,
can
be
included
in
several
documents.
Only
the
party
to
be
sued
needs
to
sign
it
but
sometimes
thats
hard
to
predict
in
advance,
so
it
should
be
signed
by
both
parties.
o The
effect
of
the
statute
within
its
scope
is
that
the
contract
is
rendered
unenforceable.
You
cant
sue
for
a
contractual
remedy.
That
means
that
both
parties
are
unable
to
obtain
a
remedy
under
it;
However
it
is
not
void
and
may
still
affect
legal
relationships
between
the
parties.
That
means
for
example,
that
if
something
was
transferred,
the
transfer
is
effective
and
the
court
will
not
help
put
the
transfer
back
into
its
original
position.
o The courts have developed methods for limiting the statute of fraud:
Memorandum
had
to
only
be
written
prior
to
the
egregious
act
or
fraud
or
contract
violation
occurring.?
Doctrine
of
part
performance
enforces
contracts
concerning
land
if
the
plaintiff
can
show
that
they
initiated
performance
of
the
contract
with
reliance
on
it,
and
then
the
courts
would
accept
evidence
of
part
performance
in
lieu
of
evidence
in
memorandum.
Plaintiff must be the party performing the act (suffering the loss, hardship).
119
of
155
The
Sales
of
Goods
Act:
Served
to
defeat
fraudulent
behavior
and
increase
certainty
to
contracts.
Only
concerns
and
only
applicable
to
the
sales
of
chattels
in
Manitoba
over
$50.
With
regards
to
illegality,
the
contract
can
affect
property
relationships,
but
the
courts
will
not
get
involved.
A
receipt
is
sufficient
writing
to
prove
that
there
has
been
a
contract.
Doctrine
of
substantial
performance:
it
is
equitys
attempt
to
limit
the
unfair
potential
of
the
statute
of
frauds
passed
because
parliament
was
worried
that
liars
were
victorious
in
courts.
However
the
statute
of
fraud
can
be
an
instrument
of
fraud
when
all
parties
to
the
contract
dont
know
if
its
existence
and
can
be
an
instrument
of
unfairness,
though
it
was
designed
to
protect
bona
fides
performance.
The
doctrine
of
part
performance
was
made
to
blank
the
negative
effects
of
the
statute
of
fraud
applies
to
land
transaction
and
indicates
that
if
a
party
has
begun
performance
of
a
contract
in
reliance
on
it
then
the
court
would
accept
evidence
of
performance
as
evidence
in
lieu
of
written
memorandum.
Suddenly
when
someone
is
being
sued,
he
or
she
will
find,
even
after
years
of
abiding
to
the
contract,
that
some
of
the
contract
has
become
unclear.
The defendant is trying to find the contract uncertain so that it will be void.
The
courts
have
developed
ways
to
define
contracts
because
they
have
a
bias
to
find
a
way
to
hold
the
contract
enforceable.
The
courts
will
look
at
the
terms
of
a
contract
to
determine
what
a
reasonable
person
would
understand
the
terms
to
mean
Very
seldom
will
the
courts
deem
a
contract
between
two
parties
void
when
there
is
a
dispute.
They
will
instead
use
the
following:
1. The
literal
meaning
approach
Used
when
there
is
a
disputed
term
in
the
contract.
Restricts
interpreting
to
the
dictionary
meaning.
2. The
liberal
approach
looks
to
the
intent
of
the
parties
in
drafting
their
agreement.
It
stresses
the
circumstances
surrounding
the
contract,
negotiations
leading
up
to
the
contract
and
the
120
of
155
knowledge
of
the
parties
and
any
relevant
facts
as
due
by
the
reasonable
person.
Generally
the
courts
combine
the
two
approaches.
They
take
the
approach
that
will
render
the
contract
effective.
This,
however,
creates
uncertainty.
It
minimizes
the
importance
of
the
words
actually
used,
and
judges
have
more
ambiguity
in
interpreting
terms
by
speculating
about
what
the
parties
intents
where
when
the
terms
were
chosen.
It
allowed
judges
to
determine
relationships
as
they
see
fit.
Parol Evidence Rule: an important rule of evidence, relevant when there is no error in transcription
Designed to create certainty in contracts. Prevented later changes from being made
About
the
ability
to
enter
in
or
submit
something
to
the
fact
finder
to
consider.
Where
there
is
a
situation
of
bargaining
and
negotiation
where
the
parties
have
put
in
a
final
form
of
agreement,
the
parol
evidence
rule
states
a
term
previously
agreed
upon
by
the
parties
but
not
included
in
the
final
written
form
of
the
contract
will
not
later
be
permitted
to
add
to
or
contradict
the
contract.
The
rule
applies
both
to
an
oral
agreement
which
is
being
reduced
to
writing
and
to
a
written
agreement
which
is
being
reduced
to
a
formal
document
under
seal.
The
rule
operates
only
to
exclude
the
introduction
of
terms
not
found
in
the
written
agreement.
Its
like
the
statute
of
frauds,
but
sometimes
it
can
be
a
weapon
of
injustice
when
people
arent
aware
of
it.
1. It
doesnt
apply
if
a
party
can
show
the
written
contract
was
never
to
embody
all
of
its
terms,
Contra
Preferentum:
the
courts
read
the
contract
against
the
interest
of
the
party
that
created
it,
if
there
are
two
interpretations
are
possible.
Requires
that
the
contract
be
constructed
against
the
party
preparing
it.
The
draftsperson
has
a
certain
latitude
of
language
that
they
could
later
take
advantage
of,
therefore,
it
will
be
construed
by
the
court
to
the
disadvantage
of
the
draftsperson.
o Contract is void
Incompleteness (failures to include date in which a lease begins agreement will fail)
Implied terms in interpreting contracts (certain terms are implied into a contract)
o Two types:
1. Statutorily
implied
terms,
-
Terms
implied
by
statutes.
ex.
In
the
Partnership
Act,
each
partner
has
equal
say
in
the
management
of
the
business.
It
is
implied
in
the
contract
and
not
required
to
be
explicitly
stated
2. Common
law
implied
terms
in
certain
situations,
judges
will
imply
terms
into
the
contracts
which
the
parties
have
not
even
thought
of.
Ex.
To
fire
someone
you
must
give
them
reasonable
notice,
or
else
it
is
considered
wrongful
dismissal
an
implied
term
is
a
term
that
parties
have
not
expressly
included
in
their
agreement
but
which
in
the
opinion
of
the
court
they
would
as
reasonable
people
have
included
when
they
made
their
contract
and
they
thought
of
the
possibility
of
the
subsequent
difficulty
arising.
They
are
usually
the
result
of
long
established
customs
or
by
precedence.
EXAM:
FOR
EXAMPLE,
THE
REASONABLE
NOTICE
PROVISION,
WHICH
IS
IMPLIED
INTO
EMPLOYMENT
CONTRACTS
AND
ESSENTIALLY
THE
COURTS
HAVE
IMPLIED
THE
TERM
INTO
NON-
COLLECTIVE
BARGAINING
122
of
155
o If
an
employer
wants
to
terminate
an
employee,
then
they
must
give
the
employee
reasonable
notice.
o As
well,
employees
have
to
give
reasonable
notice
to
employers.
The
issue
is
when
there
is
no
just
cause
for
immediate
dismissal.
o What
constitutes
reasonable
notice?
Various
factors:
length
of
service,
type
of
occupation,
the
state
of
the
economy
(generally
and
in
respect
to
their
occupation),
and
age
of
employees.
o It
is
usually
between
2
and
4
weeks
notice
for
every
year
of
service,
to
a
maximum
of
2
years,
determined
in
the
UGG
v.
Wallace
case.
o It
also
indicates
that
if
an
employees
dismissal
is
handed
in
a
mali
fides
manner,
the
length
of
notice
can
be
extended.
o You
also
have
the
option
of
giving
the
equivalent
of
notice;
you
can
give
severance.
Employers
are
putting
in
their
contract
shorter
notice
periods,
or
when
they
are
terminating,
sometimes
they
will
give
you
a
choice
of
cash
up
front
for
6
months
or
you
will
get
paid
as
if
you
were
working
for
1
year.
Doctrine
of
Fundamental
Breach
allowed
exception
of
liability
clauses
in
standard
form
contracts
to
be
negated
if
there
was
a
fundamental
breach
in
contract
ie.
If
one
side
substantially
failed
in
delivering
their
end
of
the
contract.
In
the
Tarcon
Contractors
VS.
BC
Transportation
&
Highways
case,
this
doctrine
was
defeated.
3) Doctrine of Privity
A
contract
cannot
as
a
general
rule
confer
rights
or
impose
obligations
arising
under
it
on
any
person
except
parties
to
a
contract.
People have a freedom to sign into a contract if they so please. They have an option and choice.
How
do
you
become
a
party
of
the
contract?
promises
must
be
made
to
you,
as
offeree
and
offeror,
and
you
have
to
give
up
consideration
and
then
you
can
sue
for
promises
not
kept
up
to
you.
123
of
155
The
nature
of
the
doctrine
is:
a
contract
cannot
confer
any
benefits
or
liabilities
to
strangers
to
the
contract.
o Under
an
insurance
contract,
a
beneficiary
has
a
right
to
enforce
the
benefits
of
a
contract
even
though
they
are
not
a
party
to
the
contract.
Discharge of contract means to cancel the obligation, make the contract null and inoperative.
When
a
contract
is
discharge,
the
obligation
is
at
an
end,
the
consideration
has
been
exchanged,
and
the
obligations
have
been
satisfied.
1. Discharge
by
performance
everyone
follows
the
contract,
can
also
occur
over
time.
Tender
of
performance
one
party
attempts
to
perform
but
the
other
party
refuses,
this
attempt
to
perform
is
a
tender
whether
it
is
accepted
or
rejected
by
the
other
party.
Ie.
Give
$20k
to
a
guy
for
a
car,
expecting
him
to
not
even
give
you
the
car
as
promised.
One
advantage
to
tender
is
to
ensure
that
you
wont
be
viewed
as
in
breach
of
contract.
Primary
reason
for
tendering
is
for
evidence
that
you
have
fulfilled
your
end
of
the
bargain;
it
is
a
defensive
tactic.
But
it
is
dangerous
to
tender
on
your
own,
you
should
have
solicitors
(lawyers)
because
they
pretty
much
guarantee
they
will
get
you
your
money
back.
2. Discharge by agreement:
a) The
waiver
formally
discharges
both
parties,
the
parties
agree
between
themselves
that
the
contract
doesnt
have
to
be
performed,
if
one
person
has
performed
then
the
waiver
is
ineffective,
it
becomes
a
gratuitous
promise
that
they
fulfill.
124
of
155
b) Substituted
agreement
A
new
agreement;
replace
the
first
agreement
where
one
or
more
of
the
clauses
is
that
the
first
agreement
is
discharged
-
also
novation:
substituted
agreement
with
a
new
party.
a. Accord
and
Satisfaction
when
a
party
to
the
contract
does
not
want
to
perform
according
in
the
terms
of
the
contract,
they
can
make
an
offer
of
a
cash
payment
in
a
way
to
buy
out
their
contract
and
responsibility.
Ie.
Contract
buyout
b. Option
to
Terminate
8
the
ones
offering
the
contract
can
buy
the
parties
contract
and
essentially
get
rid
of
them.
It
is
a
term
in
the
contract
when
initially
signed.
c) The
contract
provides
for
its
own
dissolution
sometimes
parties
perceive
of
the
possibility
of
an
inability
or
unwillingness
to
perform
in
certain
situations
and
they
include
a
term
allowing
for
those
circumstance.
3. Discharge
by
frustration
courts
excuse
persons
for
failure
to
perform
their
contracts
in
a
wide
variety
of
circumstance
where
the
inability
to
perform
is
not
their
fault.
This
is
called
frustration.
There
are
two
basic
types
of
frustration:
o The
effects
of
frustration:
the
contract
is
discharged
and
the
parties
are
relieved
of
further
performance,
any
benefits
already
exchanged
fall
where
they
lie.
Ex.
The
down
payment
to
the
concert
hall
would
stay
with
the
concert
hall.
o Theres
a
bit
of
rough
justice
and
as
a
result
the
English
parliament
also
passed
the
Frustrated
Contracts
Act:
which
allows
for
the
reallocation
of
the
benefits
already
exchanged.
A breach occurs when one party fails to live up to provisions of the contract.
Not every breach can discharge a contract and no breach automatically discharges the contract.
1. Warranties
minor
contractual
term
which
if
breached,
only
allows
a
suit
for
damages.
Injured
party
can
only
sue
for
the
difference
in
value
(minor
term)
2. Conditions-
breach
of
essential
terms
of
the
contract
that
allows
the
innocent
party
to
an
election
where
the
party
can:
b) Elect
to
discharge
the
contract
and
sue
for
damages.
The
problem
is
that
sometimes
you
dont
know
if
the
contractual
term
is
a
condition
or
warranty.
The
safest
course
is
usually
in
the
contract
to
define
what
a
condition
is
and
what
a
warranty
is.
3. Fundamental
terms
Super
charged
condition,
when
it
is
breached,
allows
the
grieved
party,
as
if
it
is
same
options
as
the
condition,
but
they
have
an
effect
of
negative
or
negate
exception
of
liability
clauses.
126
of
155
A. Express
Repudiation
of
Liability
expressed
repudiation
of
one
party
to
another
that
they
will
not
perform
as
promised,
the
innocent
party
has
an
election.
The
party
has
a
choice.
They
can
treat
the
contract
as
at
an
end
and
sue
for
damages,
or
the
party
can
insist
on
performance
until
latest
date
contemplated
in
the
contract,
thereby
allowing
damages
to
build
up.
B. Non-Performance
One
party
makes
a
promise
but
act
in
a
way
where
they
make
the
promise
impossible
to
fulfill.
A
deliberate
act
which
makes
performance
impossible.
Ex.
Selling
a
good
to
person
but
selling
it
to
someone
else
before
the
possession
date.
C. Failure
of
Performance
where
theres
a
failure
to
perform
at
all
or
youre
tendering
actual
performance
that
is
not
equivalent
to
the
promise.
a. Types of failures:
iii. Failure
in
a
minor
particular.
The
result
is
depending
on
the
type
of
failure
and
the
term
which
has
not
been
performed.
A
warranty,
no
matter
how
you
breach
it
the
other
party
will
only
get
damages.
A
condition,
in
order
for
the
innocent
party
to
have
an
election
it
must
be
a
total
failure
or
grossly
inadequate.
Remedies:
Two
categories
127
of
155
o Equity remedies
In
tort
law
compensation
is
translated
into
the
objective
or
measurement
of
damages
to
place
the
innocent
party
in
the
same
position
they
would
have
been
in
if
the
tort
had
not
occurred.
In
common
law
it
is
to
place
the
party
in
the
condition
they
would
have
been
in
if
the
contract
had
been
fulfilled.
Expected Damages:
o How
to
measure
the
position
would
be
in
that
situation,
so
it
is
needed
to
determine
the
profit
aspect
to
see
where
they
could
have
been:
Cost of performance
Basic remedies:
o Rectification
o The
duty
to
mitigate:
a
person
who
has
sustained
a
loss
as
a
result
of
a
breach
of
contract
must
do
what
he,
she,
or
it
can
to
mitigate
(limit)
the
extent
of
the
loss.
The
damages
it
can
recover
at
law
will
not
include
what
might
have
reasonably
avoided.
It
prevents
economic
waste.
o The
principle
of
remoteness
the
issue
is
just
like
tort,
whether
the
damages
were
reasonably
foreseeable
at
the
time
of
the
contract.
It
is
best
to
communicate
the
use
of
the
product
at
the
time
of
the
contract.
Yinsuranceou
are
only
liable
for
damages
that
128
of
155
flow
naturally
from
the
breach
and
are
regarded
as
a
lightly
consequence
of
failure
that
the
parties
thought
of
it
when
the
contract
was
made.
Ex.
using
something
or
someone
for
another
obscure
purpose
they
should
be
made
aware
of
it
at
the
beginning
of
the
contract.
In
terms
of
categories
of
damages
there
are
various
categories:
same
categories
as
tort
law.
Special
damages,
punitive
damages,
general
damages.
(29:00)
o Expectation
damages:
If
a
contract
is
breached
we
are
worried
about
lost
profit,
so
general
damages
includes
these
expected
damages.
2
Approaches:
Cost
of
performance
vs.
economic
loss
(PV
house
against
the
American
coal
Company
the
PV
houses
were
dirt
farmers
in
rural
Oaklahoma
outside
of
OKC.
PV
house
farmers
were
very
poor.
It
was
discovered
that
there
was
coal
deposits
under
their
land.
They
allowed
the
American
coal
company
to
mine
their
property
but
the
family
wanted
to
move
back.
So
they
put
in
a
clause
that
the
company
must
put
the
land
back
into
its
original
position
and
spend
whatever
they
would
have
to
do
it
(cost
of
performance).
However
the
company
didnt
restore
the
property.
The
issue
was
the
ACC
said
that
if
they
spent
the
money
to
rehabilitate
the
land
it
would
cost
more
than
the
fair
value
of
the
farm.
So
they
wanted
to
write
a
check
for
the
value
of
the
farm.
The
Supreme
Court
decided
that
the
ACC
was
right.
The
Supreme
Court
used
the
economic
loss
instead
of
the
cost
of
performance
as
it
was
way
less
and
would
be
wasteful
otherwise).
There
are
other
heads
of
damages:
reliance
damages,
mental
anguish
(equivalent
of
pain
and
suffering
in
tort
law)
Nominal
damages
the
plaintiff
is
right
but
its
not
worth
any
amount
of
damages.
You
win
in
principal
but
there
is
no
cash
Equitable remedies:
Stems
from
the
court
of
Chancery,
reacting
to
shortcomings
in
the
common
law,
in
result
to
money
not
being
good
enough.
The
remedies
given
by
equity,
it
is
deemed
to
be
in
personam,
meaning
that
if
an
equitable
remedy
is
given
and
is
not
respected
by
the
other
party,
then
the
court
can
fine
or
imprison
that
party.
(In
common
law,
this
does
not
happen)
1. The plaintiff must have clean hands they cannot be guilty of unethical conduct,
2. The
plaintiff
cannot
have
acquiescence
no
long
delays,
must
act
promptly
upon
becoming
aware
of
the
misconduct/breach,
4. Requires
substantial
consideration
the
seal
is
insufficient
as
equity
does
not
recognize
the
seal.
1. Specific Performance
Where the court orders the defendant to do a specified act, usually to complete a transaction.
Specific
performance
is
available
in
respect
of
land
and
air
looms
and
unique
material
otherwise
damages
would
be
sufficient.
130
of
155
You must prove that damages are inadequate because the material is unique.
Equitable
remedies
are
good
because
theyll
get
involved
in
enforcement,
because
if
you
dont
respond
to
an
equitable
remedy
you
will
be
held
in
contempt
of
court
and
can
be
fined
or
imprisoned
2. Injunction
For
example,
in
the
sale
of
a
business
contract,
the
vendor
is
prohibited
from
competing,
non-
competition
clause.
If
they
compete
you
can
get
an
injunction.
Usually
they
are
time-limited
(3
years).
In order for it to be available you need a negative covenant that is a promise not to do something.
o (Warner
Bros
against
Nelson
Nelson
was
Betty
Davis.
Signed
an
employment
agreement
that
stated
she
couldnt
act
for
any
other
company,
but
she
went
to
England
and
worked
for
another
company.
Betty
Davis
said
that
it
wasnt
valid
because
she
couldnt
work,
but
the
court
said
that
she
could
do
anything
else
like
waitress
etc
So
Betty
Davis
lost).
It
has
to
be
a
total
prohibition.
3. Rescission
Where
the
contract
is
set
aside
and
the
court
puts
the
parties
back
in
the
original
position
(pre-
contact
position).
Sometimes
its
impossible
to
rescind,
for
example
if
the
good
doesnt
exist
anymore.
131
of
155
The
source
of
the
principles
can
either
be
statute
or
common
law
(DIDNT
TALK
ABOUT
ANY
OF
BELOW
STUFF
THAT
IS
IN
RED)
All jurisdictions in the common law have adopted this act. The Manitoba act is an exact replication.
The
concept
known
as
caveat
emptor
(let
the
buyer
beware)
this
is
the
principle
of
law
according
to
which
absent
any
terms
in
the
contract
to
the
contrary,
the
buyer
assumes
the
risk
for
the
condition
of
the
objects
purchased.
Text
book,
caveat
emptor
does
not
mean
in
law
or
in
Latin
that
the
buyer
must
take
a
chance,
rather
it
means
the
buyer
must
take
care.
He
must
be
reasonable
cautious
where
in
circumstances
where
the
buyer
can
and
does
exercise
personal
judgment.
CE
is
however
not
a
rigid
rule
but
a
flexible
general
principle
subject
to
limits
put
on
it
by
common
sense
and
customary
business
practice.
It
is
applied
when
goods
are
in
existence
and
are
specific
items
that
may
be
inspected
by
the
buyer
and
where
the
seller
has
made
a
misrepresentation
about
them.
In
these
circumstances,
CE
is
a
sensible
rule.
The
buyer
has
the
opportunity
of
exercising
his
judgment
in
examining
the
goods
and
if
he
distrusts
his
own
judgment
or
has
doubts
he/she
may
choose
to
bargain
for
an
express
term
stating
the
goods
have
a
particular
quality
requirement.
Caveat
emptor
encourages
buyers
to
take
care,
however
certain
exceptions
are
required
to
prevent
abuse
by
unscrupulous
sellers
especially
if
there
is
reliance
on
the
seller
by
the
buyer
or
an
inability
by
the
buyer
to
inspect
the
goods.
The
sale
of
goods
act
has
created
or
codified
terms
which
are
to
protect
the
buyers
and
form
exceptions
to
the
doctrine
of
caveat
emptor.
The
sale
of
goods
act
is
in
many
ways
a
limitation
on
caveat
emptor.
In
fact,
it
is
not,
the
so-
called
exceptions
are
consistent
with
the
doctrine,
because
they
refer
to
certain
situations
where
the
purchaser
cant
investigate
what
they
are
receiving
or
they
are
relying
on
the
seller
for
information.
Caveat
emptor
applies
to
the
qualities
of
goods.
Application:
it
applies
to
the
sale
of
goods
-
two
types
of
property:
real
property
(land)
and
personal
property
(chattels
-
goods
or
choses
in
action
contractual
rights).
Goods
are
considered
to
be
all
chattels
personal,
other
than
choses
in
action
and
money.
132
of
155
It
does
not
apply
to
the
sale
of
services.
If
both,
must
determine
if
it
is
a
sale
of
material
and
labour.
Another
requirement
is
that
the
contract
needs
to
be
in
writing
if
it
deals
with
goods
in
excess
of
$50
dollars,
an
invoice
is
considered
sufficient.
Implied conditions:
1. Section
13
(Sellers
Title)
caveat
emptor
does
not
apply
to
the
ownership
of
goods,
because
inspection
by
a
buyer
does
nothing
to
indicate
who
owns
the
goods.
In
offering
to
sell
goods,
the
seller
impliedly
represents
that
he
has
the
right
to
do
so;
the
implied
condition.
2. Section
14
(Description)
it
is
an
implied
condition
that
goods
sold
by
description
will
conform
to
the
description.
3. Section
15
(Suitability
and
Quality/Fitness)
there
is
an
implied
condition
that
the
goods
are
of
a
type
that
is
suitable
for
the
purpose
for
which
they
are
bought,
but
only
(1)
when
the
buyer
expressly
or
implicitly
tells
the
seller
about
the
particular
purpose
for
which
the
goods
are
to
be
used
or
(2)
makes
known
that
he
relies
on
the
sellers
skill
or
judgment
or
(3)
the
seller
normally
sells
these
goods
in
the
course
of
business.
If
the
buyer
has
examined
the
goods,
there
is
no
implied
condition
as
regards
to
defects
that
such
examination
ought
to
have
revealed.
4. Section
16
(Sale
by
Sample)
there
is
an
implied
condition
that
when
a
sample
of
the
goods
to
be
sold
has
been
provided,
the
actual
goods
supplied
will
correspond
to
that
sample
in
type
and
quality.
Goods
will
be
free
from
any
defect
rendering
them
unmerchantable
that
would
not
be
apparent
upon
reasonable
inspection
of
the
sample.
Does
not
apply
if
defect
was
in
sample!
5. Relationship between Title and Risk (common law rule). Most important relates to the Essentially:
2. Transfer of title and risk do not necessarily occur at the moment the contract is formed,
3. Possession
does
not
imply
ownership.
So
whoever
has
title
bears
the
risk.
133
of
155
1. Lien
a
right
of
a
person
in
possession
of
property
to
retain
that
property
against
the
claim
of
the
owner,
until
the
debt
is
satisfied.
a. However,
the
right
is
based
upon
possession
and
is
extinguished
when
possession
passes
in
good
faith
to
the
buyer.
Delivery
terminates
sellers
possession.
Only
exists
when:
i. Contract
does
not
state
the
buyer
is
to
have
credit
so
the
payment
may
be
required
upon
delivery.
ii. Goods
have
been
sold
on
credit
and
the
term
of
the
credit
has
expired
without
payment
being
made
and
seller
still
has
possession.
2. A
stoppage
in
transit
the
right
of
a
seller
to
order
a
carrier
not
to
deliver
to
the
buyer,
if
the
buyer
becomes
insolvent.
This
remedy
disappears
once
the
goods
are
delivered.
a. The
carrier
is
bound
to
obey
instructions.
If
not,
the
carrier
is
liable
for
damages.
Allows
the
seller
who
may
not
have
title
or
possession
to
exercise
control
of
goods
when
carrier
is
not
part
of
the
contract.
3. Resale
after
exercising
a
right
of
lien
or
stoppage
in
transit,
an
unpaid
seller
may
give
notice
to
the
buyer
and
resell
the
goods
to
a
third
party.
It
can
also
be
used
when
a
buyer
commits
a
breach
by
refusing
to
accept
goods.
If
the
seller
has
made
a
diligent
effort
to
obtain
a
good
price
on
resale
but
obtains
a
lower
price
than
that
promised
in
the
original
contract,
he
may
sue
the
original
buyer
for
the
deficiency.
134
of
155
Specific
Goods:
exist
at
time
of
formation
of
contract,
identified,
agreed
upon
as
being
subject
matter
of
contract.
Ascertained
Goods:
not
specific
goods.
Any
goods
that
satisfy
contractual
description
of
the
goods
may
be
supplied.
AGENCY LAW
Agency Law is apparent in the Partnership Act and the Corporations Act (Apparent Authority)
Agency:
relationship
in
which
one
person
known
as
the
agent
is
authorized
to
bring
another
party
for
whom
he
acts,
aka
principle
into
contractual
relations
with
third
parties,
thereby
creating
contractual
liability.
In
addition,
the
principle
will
be
liable
for
the
agents
torts.
o Core:
agent
able
to
create
contractual
liability
with
third
parties
for
which
the
agent
is
not
liable.
o Express
Agreements:
oral,
written
with
definite
understanding
between
principle
and
agent
o Agency
by
ratification:
acts
as
agent
when
they
know
they
have
no
authority
but
hope
ratification
of
contract
will
occur
in
future.
If
it
doesnt,
alleged
agent
becomes
liable.
o Agency
by
Estoppel:
when
a
person
allows
another
to
believe
a
certain
state
of
affairs
exists
with
the
results
that
others
rely
on
that
belief.
The
person
will
afterwards
be
prevented
from
stating
the
true
state
of
affairs
was
different.
(Precluded
from
denying)
Use
Reasonable
Person
Standard
to
determine
Agency
by
Estoppel.
Apparent
Authority:
agent
has
no
real
actual
authority
exists
but
acquiescing
agent
gives
impression
that
he
is
an
agent.
o Agency by Necessity
Agents Duties:
o Competence:
agent
must
use
care,
skill
diligence
otherwise
the
principle
can
retaliate
against
the
agent.
o Good
Faith:
loyalty,
trust.
Agent
must
place
interest
of
principle
above
all
else.
You
cant
take
secret
profits
by
intercepting
information.
Principles Duties
o Commission: often not negotiated Quantum Meruit: get a reasonable price for work.
Third Parties:
o Principle alone liable for contracts but agents should always describe themselves as agents!
o When
agent
is
liable
alone
(describes
himself
as
a
principle)
the
agent
alone
has
rights
and
responsibilities
to
third
parties.
Third
party
has
the
option
of
holding
A
or
P
liable
for
performance
of
contract
but
can
only
sue
one
of
them.
PROPERTY (DEC 3)
The
normal
kind
of
property
that
is
commonly
known
is
land
and
the
things
affixed
to
the
land
136
of
155
Title
is
the
highest
level.
There
are
lesser
interests
leasehold,
borrowing,
possession.
You
can
possess
something
but
not
own
it
PERSONAL PROPERTY
When
there
is
some
kind
of
relationship
with
property
and
ownership,
there
are
two
kinds
of
personal
property:
ii. Severance
the
process
to
make
a
fixture
(part
of
the
realty)
a
chattel
again;
remove
the
title
as
fixture
for
the
chattel.
General
rule
is
that
once
it
is
a
fixture,
it
cannot
be
removed
from
the
property
when
the
property
is
transferred,
unless
it
is
indicated
in
the
contract.
If
there
is
any
doubt,
SPECIFY
in
the
contract
what
is
a
fixture
and
what
is
a
chattel.
All
the
cases
around
this
are
where
people
have
not
made
provisions
in
the
contract
Peasant
meanness:
when
people
gut
fixtures
from
the
house
when
you
buy
it
from
them,
without
them
telling
you
about
it
BAILMENT
Bailment
exists
when
one
person
takes
temporary
possession
of
personal
property
that
is
owned
by
another.
The
person
giving
up
possession
is
called
the
bailor,
the
person
acquiring
possession
is
called
the
bailee.
Title
and
possession
is
being
split;
title
remains
with
the
bailor,
possession
goes
to
the
bailee.
The
agreement
will
be
for
the
bailee
to
return
the
property
to
the
bailor.
Ex.
Of
bailment
lending
someone
a
pencil
INTELLECTUAL PROPERTY
Choses
in
Action
an
intangible
right;
in
essence,
a
right
to
sue.
It
is
a
claim
one
person
has
against
another.
Often,
but
not
always
a
contract.
It
is
seen
most
frequently
when
dealing
with
contracts;
the
138
of
155
contractual
right
to
sue.
A
chose
in
action
as
a
contractual
right,
can
be
transferred
like
personal
property,
this
is
called
an
assignment.
Intellectual
property
is
based
on
the
right
to
sue.
It
is
essentially
a
sub-category
of
personal
property
and
a
sub-category
of
choses
in
action.
Intellectual
property
deals
with
ideas
and
creative
works.
139
of
155
All
these
area
deal
with
ideas
and
creative
work.
Must
be
contrasted
to
other
forms
of
personal
property
because
if
it
is
stolen
or
wrongly
misused
it
still
exists
as
its
original
intent
was,
but
still
be
returned
to
the
owner
but
the
value
couldve
been
significantly
diminished.
When
the
property
is
decided
in
negotiations,
there
is
a
protection
that
is
called
confidentiality
agreements.
Copyrights
The
control
of
the
right
to
copy.
It
gives
the
right
of
the
creator
of
any
such
works,
ideas,
etc.
to
control
the
reproduction
of
the
work.
It
has
a
common
law
heritage,
but
they
were
replaced
or
at
least
augmented
by
statutes.
The
power
to
make
law
concerning
copyright
has
been
given
to
the
federal
parliament
exclusively.
The
Copyright
Act
has
been
in
place
for
the
last
50
years.
o Literary
works,
germatic
works,
musical
works,
artistic,
performances
by
performers,
sound
recordings,
communication
signals
etc.
o It
covers
only
the
original
work
of
the
creator.
o The
expression
is
what
is
needed
to
be
protected
not
the
idea
itself.
o The
main
concern
is
that
the
work
is
generated
or
performed,
then
it
is
automatically
under
copyright.
o The
protection
extends
for
the
life
of
the
author
+
50
years
o If
someone
produces
original
work
under
employment,
then
the
employer
owns
the
copyright.
o Once
the
copy
right
has
been
created
the
owner
can
assign
it
or
license
it
to
someone
else.
The
court
presumes
that
the
copyright
is
held
by
the
creator
unless
there
is
evidence
to
the
contrary.
They
have
the
moral
rights
and
can
keep
the
integrity
of
the
work;
the
creators
name
is
attached
to
the
work,
and
they
have
the
right
to
demand
that
the
work
cannot
be
changed
so
as
to
degrade
it
and
bring
harm
to
the
name
of
the
creator,
and
that
the
rights
cant
be
assigned
but
only
waived.
o Infringement
a
person
tries
to
obtain
a
benefit
or
use
by
the
sale,
use,
reproduction
or
distribution,
performance,
broadcast
or
other
commercial
use
of
the
work.
Plagiarism
is
most
common
form
of
infringement
in
academics.
Remedies
for
infringement:
In
common
law
injunction
Damages
in
tort
Obtain
damages
according
to
the
tort
of
passing
off
where
by
all
profits
must
be
disgorged
(dispersed
to
copyright
holder).
Specific
penalties
under
the
act
Patents
no
common
law
history
for
it,
it
is
entirely
statute
based.
A
government
produced
monopoly
that
gives
the
inventor
the
right
to
sell,
produce
or
otherwise
profit
from
a
specific
invention.
Patent
Act
-
Invention
must
be
the
original
work
of
the
inventor
and
has
not
been
introduced
to
Canada
or
anywhere
within
the
last
year.
Patents
from
other
countries
are
not
allowed
to
be
re-patented
anywhere
else
by
other
people
other
than
the
inventor.
Granting
for
patent
lasts
for
about
20
years,
but
the
inventor
must
give
sufficient
information
as
to
how
to
create
the
invention.
Extends
to
the
idea
or
concept
expressed
in
the
innovation
therefore
others
cannot
produce
a
slight
variation
as
it
is
the
same
idea.
Patent
holder
has
a
right
to
any
of
the
remedies
for
infringement
that
copyright
holders
have.
140
of
155
Trademarks
any
term,
symbol,
design,
or
combination
of
these
that
identifies
a
specific
business,
service,
or
product
that
distinguishes
it
from
the
competition.
Registered
trademarks
are
protected
under
the
Federal
Trademarks
Act.
They
are
a
method
of
protecting
goodwill,
and
also
form
part
of
the
goodwill.
Registration
in
the
trademark
journal
allows
the
owner
of
the
trademark
to
use
it
anywhere
in
Canada
but
only
for
15
years
(but
it
is
renewable).
It
does
not
eliminate
historic
uses
of
the
trademark
(ie.
companies
already
in
business,
other
than
the
one
which
registers
the
trademark).
Remedies:
Entitled
to
accounting,
damages
under
the
tort,
an
injunction,
and
specific
terms
under
the
act.
Confidential
secrets
no
federal
statutes
for
it,
but
it
is
under
protection
from
the
provincial
courts.
The
mere
ideas
are
not
property
and
cannot
be
subject
s
theft
of
ideas.
o Cadbury
Schwipes
inc
v
FBI
food:
ideas
are
not
property.
But
it
still
is
a
choses
in
action
so
it
is
up
to
be
sued.
It
dealt
with
the
idea
how
Caramilk
was
able
to
get
the
caramel
into
the
chocolate
bar.
Confidential
information,
though
it
cannot
be
the
subject
of
theft,
but
can
often
be
very
valuable,
like
secret
recopies
o Recipes,
industry
secrets,
client
lists
are
not
subject
to
theft
but
they
can
be
sold
and
can
be
of
value
for
owner.
o Protection
of
confidential
information:
best
way
is
to
impress
on
the
other
party
the
fiduciary
status
for
that
information,
so
that
if
they
break
their
fiduciary
duties
they
can
be
sued.
You
can
also
create
contracts
which
specifically
define
the
fiduciary
duties
in
regards
to
the
information,
and
include
non-disclosure
agreements.
REAL PROPERTY
Real
Property
land
and
everything
permanently
attached
(affixed)
to
it.
At
common
law,
real
property
includes
buildings
constructed
on
the
land,
any
of
the
minerals
below
in
the
land
and
any
of
the
airspace
above
it.
It
has
been
changed
over
time
in
statutes;
they
have
diminished
over
times
ex)
Manitoba
is
the
owner
of
the
minerals
in
the
land,
with
some
exceptions.
The
origin
of
real
property
comes
from
the
remedies
that
one
can
obtain
when
property
rights
were
interfered
with.
Instead
of
getting
damages
and
no
land
back
then
it
was
changed
as
to
get
the
property
back.
Real
action,
gave
back
the
property.
Dates
back
to
the
feudal
system
Much
of
the
legislation
in
land
law
was
derived
from
feudal
England
(which
was
brought
to
England
in
1066
by
William
the
Conqueror)
Feudalism
was
essentially
a
protection
racket
and
pyramid
scheme
after
Rome
fell,
the
barbarians
were
looting
and
pillaging,
so
people
in
these
vulnerable
areas
needed
a
mechanism
to
defend
themselves;
feudalism
emerged.
Feudal
system
required
that
people
who
occupied
land
would
transfer
their
ownership
of
their
land
to
the
king
in
return
for
protection.
The
king
needed
to
raise
arms
to
protect
all
these
people
which
was
expensive,
so
he
had
various
landed
aristocrats
(prince,
viscount,
bard,
duke,
knight)
to
hold
the
land
from
him
in
return
for
military
service.
Lesser
people
below
these
individuals
would
hold
land
all
the
way
down
to
serfs.
Basic
concept
is
no
one
owns
the
land
except
the
crown.
Various
landed
aristocrats
would
hold
the
land.
The
last
Anglo-Saxon
aristocrat
was
Robin
of
Loxley.
All
the
other
nobility
were
French.
Originally
real
property
in
Manitoba
was
controlled
exclusively
by
the
common
law
(and
then
also
the
Tort
of
Nuisance).
In
the
20th
century,
by-laws
emerged
In
current
times,
the
real
property
is
under
control
of
provincial
statutes,
such
as
zoning.
141
of
155
In
time,
the
complex
feudal
land
system
was
simplified
by
the
courts
to
two
types
of
land
ownership.
Needed
to
simply
because
taxation
was
so
complicated.
Two
types
of
ownership:
estates
in
time
interest
lesser
than
estates
Estates In Time - 3 types: Freehold estates (fee simple estate and life estate) and leasehold estate
1. Fee
simple
estate:
is
the
estate
in
land
that
can
represent
the
greatest
interest
in
time
in
land
that
a
person
may
possess,
and
that
can
be
conveyed
or
passed
by
will
to
another
or
in
case
of
intestate
(to
die
without
a
will)
the
land
goes
to
the
heirs.
It
is
extremely
important
to
look
at
the
land
and
see
the
time
granted,
because
while
the
crown
still
owns
the
land
that
if
someone
has
fee
simple
land,
they
have
a
certain
amount
of
time
to
be
on
the
land
and/or
make
changes
on
it.
The
land
rarely
reverts
to
the
crown
because
the
land
can
be
freely
transferred
through
sale,
will
or
inheritance
and
only
when
the
none
of
the
methods
have
been
exhumed
and
the
owner
dies
,
does
the
land
then
revert
back
to
the
crown,
this
is
called
escheat.
This
holds
true
of
all
property
in
Canada.
2. Life
estate:
most
extensive
in
time,
which
a
person
in
possession
of
the
land
might
grant
to
someone
else,
apart
from
the
fee
simple.
It
is
a
free-hold
estate
(indeterminate
of
time)
that
may
be
held
by
a
person
other
than
the
owner
of
the
fee
simple
for
a
particular
life
time
usually
of
the
tenant
themselves.
If
one
does
the
transfer
of
the
fee
simple
in
this
manor
they
are
able
to
live
and
use
the
land
as
they
please
for
their
entire
lifetime
but
the
ownership
is
given
to
another.
Ex)
usually
the
case
with
farmer
families.
a. What
happens
after
the
life
estate
is
up
(the
tenant
dies):
i. Reversion
when
the
grantor
of
the
life
estate
reserves
the
balance
of
the
fee
simple
for
himself
and
his
heirs.
It
reverts
back
to
the
grantor
ii. Remainder
when
the
land
goes
to
a
3rd
party
after
the
life
estate
is
up
b. Problems
with
life
estate:
i. It
is
hard
to
determine
who
does
the
maintenance,
repairs,
cleaning
of
the
land.
In
common
law,
the
life
tenant
is
not
responsible
for
structural
repairs
of
the
building,
but
they
are
responsible
for
normal
upkeep
(cleanliness,
paying
taxes
and
insurance).
ii. It
is
hard
to
market
them
(hard
to
find
a
buyer)
3. Leasehold
estate:
it
is
specified
for
a
limited
time
(agreed
upon)
after
which
the
land
reverts
back
to
the
land
owner.
Short
or
long
term;
periodic
or
continual.
142
of
155
To own land concurrently (by two or more people at the same time), there are 2 methods to do so:
1. Tenants
in
common:
if
the
transmission
of
the
property
doesnt
specify
joint
tenancy,
you
are
automatically
tenants
in
common.
The
parties
each
hold
an
equal
part
of
the
property
and
split
the
income
evenly.
It
is
not
possible
for
one
to
fence
off
the
other
and
use
the
property
isolated
from
each
other
(each
tenant
is
entitled
to
use
the
whole
property)
unless
it
is
agreed
upon.
One
of
the
tenants
can
transfer
their
ownership
to
a
3rd
party
without
the
consent
of
the
other
tenant
in
common.
If
one
of
the
tenants
dies,
the
ownership
transfers
over
to
their
heir
or
beneficiary
who
continues
to
hold
their
interest
with
the
other
tenants
in
common.
2. Joint
tenancy:
Created
by
an
express
agreement
among
the
tenants.
The
feature
that
distinguishes
a
joint
tenancy
from
a
tenant
in
common
is
the
right
of
survivorship,
which
is
a
presumption,
means
that
the
interests
of
a
deceased
joint
tenant
passes
on
to
the
surviving
joint
tenant
or
tenants
instead
of
the
heirs
of
the
deceased
joint
tenant.
The
interest
doesnt
form
part
of
their
estate.
Frequently
used
with
spouses.
a. Probate:
the
process
of
carrying
out
the
will
and
the
fees
are
based
on
the
percentage
of
the
value
of
the
property.
This
is
avoided
by
having
joint
tenancy;
property
automatically
passes
to
the
other
joint
tenant
without
having
to
go
through
the
probate
process.
b. Severance:
Turning
the
joint
tenancy
into
a
tenants
in
common.
Most
common
type
is
an
agreement
between
the
parties.
Can
also
be
done
through
notification
or
by
mortgaging
your
interest.
You
cannot
sever
a
joint
tenancy
through
your
will.
Condominium:
Solution
to
the
issue
of
the
lack
of
houses
and
property
for
people
to
live,
especially
in
the
urban
center.
Condominium
Act
(MB)
permits
the
granting
of
fee
simple
estate
in
individual
units
of
a
multiple
unit
building
(which
includes
high
rises,
apartments,
duplex,
roadhouses).
Applies
to
residential
and
commercial
buildings.
o Overview
of
a
condominium:
there
are
multiple
individual
unit
owners
who
have
individual
fee
simple
titles.
The
unit
title
covers
(the
unit
owners
own)
the
unit
and
a
percentage
of
the
common
elements
(everything
but
the
unit
itself;
sidewalks,
lobby,
pool,
parking
lot,
etc.)
which
are
owned
and
operated
by
the
condominium
corporation
and
is
governed
by
the
unit
holders
who
have
the
same
percentage
vote
in
the
condominium
corporation
as
they
have
in
the
common
elements.
The
unit
holders
are
equivalent
to
the
shareholders.
143
of
155
None
of
these
rights
give
exclusive
possession
like
freehold
and
leasehold
do
Easement:
is
a
right
enjoyed
by
one
land
owner
over
the
land
of
another
for
a
special
purpose,
rather
than
the
general
use
and
occupation
of
the
land.
Typically
easements
are
attached
by
agreement.
Purchasers
of
the
land
acquire
the
easements
with
it.
This
is
enforced
by
a
contract.
In
order
to
get
an
easement
there
needs
to
be
dominant
tenement
(the
piece
of
land
that
is
to
benefit
from
the
easement)
and
a
servient
tenement
(land
subject
to
the
easement).
Once
the
easement
is
established,
it
binds
subsequent
owners
and
runs
with
the
property.
Some
easements:
o Rigth
of
way:
most
common
easement;
being
able
to
cross
over
someones
land
to
get
to
their
own
land.
Rights
and
obligations:
The
passerby
cannot
stay
on
that
part
of
the
land,
build
anything,
obstruct
others
from
using
it,
or
leave
anything
behind
No
one
can
interfere
with
the
path
for
the
passerby
and
if
done
so,
the
passerby
can
take
legal
action.
o Prescriptive
easement:
the
land
owner
acquires
an
easement
over
adjoining
land
without
a
grant
or
contract
by
the
servient
tenement,
but
rather
by
prescription.
If
an
individual
habitually
exercises
a
right
over
the
land
for
a
very
long
time
and
that
right
could
have
been
granted
an
easement,
it
is
presumed
that
he
has
that
grant
after
twenty
years.
Has
to
be
exercised
continuously
without
interruption
by
the
ownership.
o Mineral
Rights:
Originally
they
were
a
part
of
the
fee
simple.
In
Manitoba
you
can
get
a
separate
title
for
mineral
rights.
Until
1890
in
MB,
mineral
rights
and
sand
and
gravel
rights
were
granted
with
the
fee
simple
title.
After
1890,
they
were
not
granted.
1890-1930,
mineral
rights
weren`t
granted
but
sand
and
gravel
still
were.
After
1930,
no
mineral
rights
and
no
sand
and
gravel
rights
were
granted
with
the
fee
simple.
When
the
crown
owns
the
mineral
rights,
they
have
a
different
regime
for
the
exploration
and
mining
of
the
minerals.
Getting
an
exploration
lease
or
mining
lease
from
the
province
and
it
actually
costs
a
lot
in
government
fees.
If
someone
doesn`t
own
the
mineral
rights
for
their
land,
you
can
get
an
exploratory
lease
or
a
mining
lease
on
their
land
(in
rural
MB).
o Statutory
easement:
hydro
lines
have
these
kinds
of
easements
granted
for
them;
as
well
as
phone
lines.
o Restrictive
covenant:
when
there
is
a
sale
of
land
but
the
vendor
wishes
to
constrict
the
use
of
the
land
after
which
it
is
sold.
A
form
of
contract
that
the
court
would
enforce
and
it
came
144
of
155
from
equity
courts.
It
is
about
preventing
certain
use
of
land.
(Ex.
Can
build
houses
larger
than
xx
ft.,
or
build
certain
point
close
enough
to
the
property
land.)
This
created
the
early
version
of
zoning.
Subject
to
privity
because
covenant
runs
with
the
property.
The
method
to
enforce
the
covenant
is
the
injunction.
The
court
will
withhold
negative
covenants
(refrain
from
doing
something)
but
not
positive
covenants.
o Sometimes
to
string
cables
and
power
lines
across
peoples
properties
In
olden
times,
land
titles
were
a
paper
document
issued
by
the
crown
to
the
title
holder
that
was
passed
along
with
sale
to
new
title
holders.
Problem
was
if
it
was
destroyed
or
simply
deteriorated
with
time
Registry
system
emerged
in
17th
century
transfers
of
land
were
recorded
in
a
public
registry,
with
a
duplicate
given
to
the
owner.
New
purchasers
of
land
would
need
to
search
through
the
registry
for
the
prior
40
years
to
see
any
interests
that
were
held
in
the
land.
Any
interests
prior
to
that
were
not
valid
due
to
statutes?
VERIFY
Problem
with
registry
system
is
searching
documents
is
labor
intensive,
and
an
error
in
a
document
that
is
later
discovered
(ie.
someone`s
interest
changes,
but
it
is
not
noted
in
the
registry),
can
cause
problems.
In
MB
we
have
the
Torrens
System,
adopted
in
the
late
19th
century.
Most
of
the
western
provinces
have
copied
this
system.
The
distinctive
feature:
each
new
transaction
concerning
a
piece
of
land
is
submitted
for
registration
then
the
land
titles
office
carefully
examines
the
document
before
approving
it.
At
the
time
of
recording
the
land
titles
office
brings
all
outstanding
interest
in
land
up
to
date
and
certifies
them
as
being
correct.
The
government
guarantees
the
accuracy
of
the
title,
as
shown
on
the
record,
and
summarizes
it.
The
great
advantage
for
the
purchaser
is
they
don`t
have
to
search
back
40
years.
Gives
you
a
current
up
to
date
title
that
is
guaranteed.
145
of
155
Andrei Pollard: Credit rests on confidence; confidence in the people and the system
Negotiable
Instrument:
means
to
transfer
funds
between
parties
to
a
transaction
without
the
immediate
and
physical
exchange
of
cash.
It
is
of
maximum
importance
in
an
economy
of
sophistication.
2. First
utility
is
as
a
replacement
for
cash.
With
large
sums
in
business,
otherwise
we
would
have
wheelbarrows
of
cash
3. Gives greater certainty to certain types of assignments. People can better depend on NI
Cheques
6. The
rules
that
govern
negotiability
distinguish
the
NI
from
others.
The
method
that
they
can
be
transferred
from
a
creditor
to
a
third
party
with
debtor
remaining
liable
on
the
instrument.
A
NI
is
a
form
of
personal
property.
They
are
a
type
of
chose
in
action
that
has
special
importance
in
the
world
of
commerce.
It
is
a
written
document
such
as
bank
draft,
promissory
notes
or
a
cheque
that
is
evidence
of
a
right
in
some
kind
of
intangible
form
are
NIs.
It
is
a
contract
containing
a
promise
expressed
or
implied
to
pay
a
specific
sum
of
money
to
the
bearer
or
to
a
specific
person.
Thus
a
NI
can
be
used
to
transfer
ownership
of
intangible
rights
from
one
person
to
another.
NIs
are
written
documents
used
to
transfer
rights
found
in
the
document.
146
of
155
1. NIs are contracts, but they are usually part of consideration for a larger contract
2. Expressed
or
implied
promise
to
pay
specific
sum
of
money
to
the
order
of
a
specific
person
or
bearer,
thus
a
NI
can
be
used
to
transfer
ownership
of
intangible
rights
from
one
person
to
another.
3. Can
be
transferred
or
assigned
by
the
payee
to
the
third
party.
Transfer
of
contractual
rights
is
referred
to
as
an
assignment
4. The
transfer
process
with
respect
to
NIs
is
call
negotiation.
Negotiation
is
thus
a
subset
of
assignment.
Through
negotiation,
the
payee
has
assigned
their
rights
to
a
third
party.
147
of
155
2. Assignee
can
only
receive
rights
assignor
has
and
is
subject
to
the
equities
of
them
(parties
to
the
original
contract).
3. Assignee
and
assignor
must
join
to
sue
a
defaulted
promissory.
(therefore
it
reduces
certainty
as
it
doesnt
work
exactly
like
cash)
1. Holder
need
not
give
notice
to
the
promisor
that
rights
have
been
transferred.
(They
can
just
cash
the
cheque
or
assign
it
to
someone
else
without
notice)
2. The
Third
Party
can
obtain
better
title
than
the
assignor.
Not
subject
to
equities
between
original
parties.
(original
creditors
fraud
in
obtaining
an
instrument
is
ignored.
Innocent
subsequent
party
even
under
a
voidable
contract)
6. The whole instrument (complete sum) must be negotiated (not just part of it).
NOTE:
Signor
of
cheque
is
personable
liable
unless
it
is
clear
that
they
act
in
representative
capacity
(use
the
word
PER).
148
of
155
Instrument
is
not
negotiable
if
it
does
not
meet
above
criteria,
but
could
still
be
a
contract.
Must
be
endorsed
(signed
on
the
reverse
side)
and
physically
delivered
to
the
new
holder
to
transfer
it
Money
used
to
be
a
Bearer
Instrument
as
the
bearer
would
be
paid
in
gold
if
they
turn
in
the
paper
bill
149
of
155
Deals with Choses in Action (a right, obligation that can be enforced in courts)
The
assignee
can
only
receive
the
right
the
assignor
has
and
is
subject
to
equities
with
the
existing
parties
to
the
contract
The assignee and assignor must join to sue for the faulty promisor.
2. Endorsement & Delivery: payable to A to negotiate, A must endorse it and deliver it.
Can
become
a
bearer
instrument
(so
dont
sign
in
advance
cheques
made
out
to
you).
Promissory
Notes:
NI
unconditional,
in
writing,
paying
specific
sum,
paid
on
demand,
unlike
Bill
of
Exchange,
a
PN
is
prepared
by
the
maker
(debtor).
2)
Insurance:
there
are
specialized
rules
both
by
common
law
and
by
statute.
Insurance
is
a
contract
where
you
protect
yourself
from
risk
of
loss.
Types:
house
insurance,
life
insurance,
health
insurance,
car
insurance.
Definition
in
its
simplest
terms
is
a
method
of
shifting
risk
of
loss
that
is
a
method
of
purchasing
against
the
potential
of
loss.
Not
only
does
insurance
shift
the
risk
of
loss
against
the
person
purchasing
the
protection,
it
also
spreads
the
risk
among
a
number
of
parties
who
have
agreed
to
take
a
share
in
the
risk.
Advantages:
money
can
be
collected
in
advance
to
create
a
fund
available
to
pay
claims;
the
amount
collected
can
be
calculated
so
that
it
is
related
to
the
risk
assumed.
Insurance
companies
run
on
a
profit
basis
and
provide
protection.
Mutual
companies
operate
so
that
profits
are
retained
by
policy
holders.
What
separates
insurance
from
a
bet,
because
a
wager
is
not
a
legal
object
according
to
the
elements
of
a
contract?
It
seems
that
the
person
is
betting
that
they
will
die
and
the
insurance
company
is
betting
that
the
person
will
live.
The
reason
given
is
the
insurable
interest
exists
where
the
insured
derives
a
financial
benefit
in
the
continuing
existence
of
the
insured
object
or
suffers
a
financial
loss
from
the
loss
of
the
object.
Compensation
will
be
paid
by
the
insurer
to
the
individual
named
as
a
beneficiary.
(EXAM
QUESTION)
April 9, 2003
Insurance
Law
insurance
in
its
simplest
form
is
a
method
for
shifting
a
risk
of
loss;
that
is
a
method
of
purchasing
protection
against
a
possible
loss.
Not
only
does
insurance
shift
the
risk
of
loss
from
the
person
purchasing,
but
among
a
group
of
parties
who
have
agreed
to
share
the
risk.
from
a
wager
is
what
is
called
insurable
interest.
Subrogation
when
an
insurer
has
compensated
the
insured
by
paying
a
claim
for
a
loss,
the
insurer
is
entitled
to
step
into
the
shoes
of
the
insured
and
sue
the
person
liable
for
the
loss.
Contracts
of
insurance
are
contracts
of
up-most
good
faith,
in
the
fact
that
the
insured
has
a
duty
to
reveal
all
pertinent
information
to
the
insurer,
an
exception
to
caveat
emptor.
Can
be
run
on
two
bases:
for
profit
or
as
a
mutual
insurance
company.
Mutual
insurance
companies
are
organized
so
that
profits
are
returned
to
the
property
holders.
There
is
a
process
of
demutualization,
where
policy
holders
are
given
shares
of
the
corporation,
for
the
sake
of
raising
funds
and
becoming
more
efficient.
3.
Employment
law
-
contract
of
employment:
there
are
implied
terms
both
by
a)
statute
workers
compensation,
minimum
wages
and
b)
common
law
-
reasonable
notice
provision.
In
addition
there
can
be
negotiated
terms
including:
the
duration
of
the
contract,
the
consideration
you
are
being
paid,
duties
involved.
Other
important
terms:
non
competition
clause
after
you
have
been
employed
for
a
period
time
you
cant
compete
as
an
employer
of
another
business
or
your
own
business.
If
you
ask
for
too
much
as
an
employer
then
the
court
will
strike
down
and
void
the
non
competition
clause.
They
additionally
have
a
clause
that
you
have
to
keep
all
the
company
secrets.
Vicarious
liability
for
employees
the
courts
have
developed
the
principle
of
vicarious
liability
whereby
an
employer
is
liable
to
compensate
persons
for
harm
caused
by
an
employee
in
the
course
of
employment.
The
employee
remains
personally
liable
for
the
tort
but
often
the
best
chance
for
recovery
by
the
victim
lies
against
the
employer.
You
have
to
give
reasonable
notice
but
sometimes
there
can
be
dismissal
for
just
cause
that
doesnt
require
reasonable
notice:
a
type
of
serious
misconduct
or
obvious
disobedience.
However,
there
is
a
necessity
to
document
and
give
the
employee
a
bit
of
a
chance.
Chronic
illness
creates
frustration
of
the
employment
arrangement.
152
of
155
BANKRUPTCY
Bankruptcy and Insolvency act passed in 1992, the act applies to three groups:
1) Proposal:
An
agreement
between
the
debtor
and
his
or
her
creditors
to
allow
the
debtor
to
reorganize
their
affairs
so
that
bankruptcy
can
be
avoided.
The
insolvent
individual
is
trying
to
make
a
deal
with
the
debtors:
more
time,
lower
amount
of
debt,
a
lower
level
of
interest,
or
a
combination
of
the
three.
there
are
two
kinds:
Consumer
Proposals:
made
only
by
the
individual
whose
debts,
not
including
the
debts
secured
by
mortgage
on
a
principle
residence,
total
less
than
$75,000.
Usually
looking
for
more
time
to
pay
debt
or
to
lower
the
amount
owed.
Formal
acceptance
by
the
creditor
is
only
needed
under
special
circumstances,
usually
under
objection.
There
are
certain
benefits
of
consumer
proposal:
no
termination
of
leases,
acceleration
of
installment
of
payments
and
the
interruption
of
services
by
utility.
If
creditor
rejects
the
proposal,
the
individual
is
not
automatically
declared
bankrupt.
Commercial:
If
the
creditors
reject
the
proposal
the
individual
or
business
is
bankrupt.
o Thing
you
need
to
have
to
get
bankruptcy:
You
need
to
have
the
majority
of
each
class
of
secured
creditors
(2/3s)
153
of
155
o Prove
that
the
debtor
has
done
certain
things
to
avoid
paying
of
the
creditors.
o Then
distribute
the
assets
to
the
creditors
accordingly:
first
to
the
secured
creditors
who
have
priority
with
respect
to
the
asset
they
have
a
security
interest
(a
debt
that
allows
the
lender
to
seize
the
property
if
there
is
failure
to
pay.
Ex.
Mortgage),
then
to
the
trustee
to
pay
the
other
creditors,
preferred
creditors
paid
in
the
order
listed:
employees
for
back
wages
up
to
$2,000,
the
pro
rata
basis
(getting
so
many
cents
per
dollar
being
owed)
3) Petition
for
a
Receiving
Order:
A
way
by
receiving
order,
this
is
where
the
creditors
obtain
an
order
by
the
court
placing
the
insolvent
debtor
into
bankruptcy.
In
order
to
do
so
the
debtor
must
have
committed
an
act
of
bankruptcy
within
the
last
60
months
and
has
to
be
greater
than
$1,000.
Once
there
is
an
assignment
or
receiving
order
a
trustee
is
assigned
by
a
court,
they
have
control
over
all
your
affairs.
Acts
of
bankruptcy
include:
fraudulent
preferences,
fraudulent
transfers
of
assets
or
money,
absconding
of
funds,
failure
to
pay
debts
as
they
come
due.
The
trustee
will
sell
your
assets
so
that
the
creditors
can
be
paid,
they
will
seek
to
recover
property
that
the
debtor
no
longer
owns
when
there
was
a:
1) settlements
gifts
made
by
the
debtor
made
gratuitously
within
the
year
prior
to
bankruptcy,
and
in
some
cases
within
the
last
5
years
if
the
trustee
can
prove
that
at
that
time
they
were
unable
to
pay
debts
without
the
property
in
question,.
2) Fraudulent
Purchases
payment
or
transfer
of
property
to
a
creditor
by
an
insolvent
debtor
in
the
last
3
months
prior
to
bankruptcy
in
order
to
give
that
creditor
an
advantage
over
other
creditors,
where
the
creditor
was
aware
of
the
impending
bankruptcy
3) Reviewable
Transaction
occurs
12
months
prior
to
bankruptcy
where
there
isnt
an
arms
length
(relatives)
transaction
and
not
for
fair
market
value
(ie.
selling
a
house
worth
$100,000
to
a
relative
for
only
$20,000).
In
addition,
during
the
period
of
bankruptcy
they
must
pay
monthly
payments
to
the
trustees
that
are
income
dependent.
155
of
155
At
the
end
of
the
process,
the
claims
of
the
creditors
are
paid
in
order
(priority):
1)
secured
creditors
must
be
fully
paid
by
funds
available.
The
trustee
can
sell
the
assets
and
the
surplus
remains
with
the
trustee
for
payment
to
the
other
creditors.
Any
deficit
in
funds
in
such
a
situation,
creates
a
general
creditor
position
for
that
secured
creditor
2)
preferred
creditors
(defined
in
the
act,
must
be
paid
in
full
in
the
order
listed)
the
trustee,
employees.
Once
these
parties
are
completely
paid,
3)
distributions
to
unsecured
creditors
where
there
is
like
a
10
cents
on
the
dollar
return.
Once
the
creditors
are
paid,
there
is
an
application
to
the
court
for
a
discharge
and
all
your
debts
go
away,
except
if
you
fraudulently
misrepresented
things
those
may
be
continued
and
student
loans
continue,
alimony
payments
continue
as
well.
Its
easier
to
take
prophylactic
action,
you
can
go
broke
and
still
protect
some
assets;
creditor
proof
assets
like
RSPs.
You can have your home foreclosed upon but not go bankrupt.