LAW FOR PROFESSIONAL PRACTICE

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DEFINITIONS

Civil Law

A type of law based on the Napoleonic Code of France. Currently used in Quebec and does not rely on case precedent. 

Common Law

A legal system that judges develop through past case precedents and similar tribunals.  It is used in many countries with ties to the British Legal System, such as Canada (except Quebec), the USA (except Louisiana), New Zealand, and India.

Fundamental breach

A failure of contract duty so fundamental that it allows the distressed party to:

1. a) continue to perform and sue for damages; or
2. b) terminate the contract and sue for damages.

Consequential damages

Losses, such as lost business revenue, usually occur due to something else going wrong. For example, if a contractor doesn't make a contractual arrangement with the municipality to have the power turned on for a building, the owner would lose revenue from its operations. 

Repudiation

When one party to the contract informs the other that it has no intention of performing its contractual obligations. 

Mutual Mistake

A mistake made by both parties.

Duty to warn

The professional's obligation (in contract or tort) to warn the client or others of impending damage to persons or property. This warning could be from not following the professional's advice or as simple as a hazard identified on a job site. 

Tort & Tort liability criteria

A private or civil wrong or injury, one that involves negligence and may arrive independently of contract. 

Must satisfy all four: 

1. The defendant owed the plaintiff a duty of care; 
2. The defendant breached the duty by his/her conduct; 
3. The defendant's conduct caused the injury to the plaintiff; and
4. The breach was the proximate cause of the plaintiff's loss. 

Employee's 3 Occupational Health and Safety rights

1. Right to know (of hazards and how to work machinery);
2. Right to refuse dangerous work; 
3. Right to participate (in a safer workplace by joining health and safety committees). 

Holdback

A technique imposed by the Provincial Lien Acts ensures that those working for the general contractor, such as a subcontractor, are paid by the general. 

How it works: the owner holds back a certain percentage (e.g. 10%) from each of the contractor's invoices. After the project, the subcontractor can file a lien if they have not been paid.  If a lien is not filed after a certain time frame, the owner can pay the general contractor the holdback amount. If there is a lien filed, the owner must wait until the lien is resolved.

Occupational Health and Safety responsibilities for employees

Take responsibility for personal health and safety, comply with the Act and regulations and report any known hazard or violations of the Act to the employer. If a satisfactory response is not imminent, escalate to regulatory authorities. 

Specific Performance

To resolve a contract dispute, a judge may order a party to perform a particular part of the contract. This action is the specific performance that the judge/court feels would remedy the dispute (e.g. sale of land). Note: The court will not order specific performance for an action that it needs to supervise or verify (e.g. installation of machinery, engineering services).

Waiver

Giving up contract rights either verbally or by one's action.

Estoppel

A legal term that describes an action that the courts can use to prevent a party from enforcing the strict wording of the contract when that party has waived its rights, putting the other party at a disadvantage.

Vicarious liability

The employer is liable for the negligence of an employee that causes injury or damages. The purpose is to compensate the injured party, and the employer is presumed to be in a better financial position than the employee to pay.

Employment rights under Provincial/Territorial 'Human Rights Code' (list 5)

Race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, age, sex, sexual orientation, marital status, family status, record of offences, or handicap. 

Contract amendment

A change or alteration to the contract. It is considered a mini-contract that should always be in writing and signed off by contracting parties before the new work is performed. It needs to have the same elements of a contract (such as consideration, lawful purpose, etc). 

PIPEDA

Stands for Personal Information Protection and Electronic Documents Act and it governs how private sector organizations collect, use and disclose personal information. 

Supreme Court of Canada

The highest court in Canada. It is the ultimate level of appeal in the Canadian justice system.

Expert Witness

Someone with the skills, training and experience to comment on court case details. Their opinions are admissible and may clarify complex matters for the judge/jury to formulate a judgment.

Quantum Meruit

When services have been requested and performed without a payment agreement in place. In such a situation, the courts will award an amount based on a quantum meruit - "as much as is reasonably deserved" for the time spent and materials supplied.

Why is arbitration often used?

It is used because it is often less costly, takes less time and is less public than litigation.

Contracts - What makes them voidable?

A mistake, misrepresentation, duress, unconscionability and frustration. 

The basic structure of the Canadian legal system

The constitution is the basis for all legal authority in Canada. It divides power between federal and provincial governments (e.g. federal would be things like defense, patent & criminal law; whereas provincial would cover topics like property rights and construction liens. It also covers the Charter of Rights and Freedoms. 

Environmental site assessments (3 phases)

Phase 1 - To determine if a site/property might be subject to contamination. 

Phase 2 - Sees to categorize contamination types and quantities relative to safety thresholds. 

Phase 3 - Detailed description of the contaminations, the process for remediation and measuring success. 

Misrepresentation (3 types of)

1. Innocent 
2. Negligent 
3. Fraudulent 

Intellectual property (IP) (list 4 types and what each one protects)

1. Patents protect new, useful and innovative inventions. 
2. Trademarks (symbols ™,®) protect a Logo, Symbol, Name, Slogan, Design or combination of these. 
3. Copyright (symbol ©) protects - written works, computer programs, works of art. 
4. Trade secrets are something of value to a business (e.g. client list, process, formula) that a company must keep a secret to maintain its worth. 

Fraudulent misrepresentation

When the party knowingly or recklessly uses an untrue statement or assertion of fact to induce another party to enter into a contract. The misled party is usually entitled to the following: rescind the contract, claim compensation for costs incurred as a result of entering into the contract, and sue for damages for deceit.

Contract

A lawful agreement between two or more voluntary parties. 

Essential elements of an enforceable contract

The 5 elements are 

1. Offer made and accepted; 
2. Mutual intent to enter into the contract; 
3. Consideration (something of value will be exchanged); 
4. Capacity of contract (e.g. not inebriated when signed the contract, can't be a minor, etc.);  
5. Lawful purpose (e.g. can't enforce an illegal drug deal)

 

QUESTIONS

What’s the difference between Civil Law and Civil Code?

The term civil law is often used to reference two main areas of law in Canada. First, civil law can refer to any type of law in Canada outside of public law. Public law, most notably criminal law, is concerned with any harm done to society. Civil law deals with private law between citizens in areas such as employment law, family law, tort law or contract law. Second, the term "Civil Law" can refer to the law used only in Quebec, which is based on the Quebec Civil Code. While all other provinces and territories in Canada use Common Law, Quebec uses Civil law to govern the relationships between private individuals. Quebec's civil code is based on the French Napoleonic code. Unlike common law, which is based on judge-made law or precedence, which are decisions in previous cases that had similar details or facts, Civil law attempts to codify all basic principles of law so that there are statutes that clearly state all laws.  In Civil law, the courts will first look to the Civil Code and then refer to any past cases that were similar to see if they were consistent. In short, Civil law can refer to any law in Canada  outside of public law, or it can refer to the law used in Quebec based on the Quebec Civil Code.

What’s the difference between litigation and arbitration?

Litigation versus Arbitration:

Litigation and arbitration are two of the four most well-known forms of dispute resolution in Canada. All four include litigation, arbitration, mediation and negotiation. Though they have some similarities, the two are actually quite different. The main differences between the two are that litigation is usually more expensive, more time-consuming and overall more formal. Further, litigation is public, whereas arbitration can remain private and confidential. Litigation is the use of the court system to solve disputes. The plaintiff's participation is voluntary, meaning they can choose to bring the issue to court, whereas the defendant's participation is involuntary, meaning they must participate. Once a dispute arises, the parties or their lawyers will present the facts of the case to a judge or jury, who will then decide the outcome of the case based on law. This decision will be legally binding, although appeals can be made. However, this can make the process longer and, again, more costly. The outcomes of litigation, as well as the details of the case, can also be made public. In contrast, arbitration can be voluntary by both parties, meaning that both parties have to agree to join arbitration. However, contracts will often mandate arbitration should an issue arise,and if this is agreed upon in the contract creation phase, then arbitration becomes involuntary, meaning the parties must participate. In this process, the parties decide upon a neutral third-party arbitrator, or the court will appoint one if none can be chosen. The arbitrator often has knowledge and experience in the area of the dispute, which can help to speed along the process. Arbitrators will hear the evidence of the dispute in a less formal setting with less formal rules. For example, in arbitration, hearsay evidence is admissible, whereas, in litigation, hearsay is inadmissible, then the arbitrator will make a decision which is enforceable. One major advantage of arbitration over litigation is that the entire process can remain private. Therefore, if there are any trade secrets or other types of proprietary information involved, the dispute, the details and the outcome will be kept confidential. This confidentiality can also help to preserve working relationships between the parties of a dispute. Therefore, though both litigation and arbitration are both types of legally binding dispute resolution they do have many differences.

What’s the difference between Trademarks and Trade Secrets?

Trademarks versus Trade Secrets.

Both trademarks and trade secrets are forms of intellectual property, which, similar to normal property, can be bought, sold or licensed. Though they both fall under the category of intellectual property, the main difference between the two is that they protect different types of intellectual property, and they are different in how they are protected. Trademarks typically protect things such as symbols, logos, slogans, names or designs that a company uses to identify itself or its goods in the marketplace. Trademarks are protected under Canada's trademark act, and once they are registered, they remain  protected for 10 years. This protection can be renewed for 10-year periods once the original period expires. Trade secrets which can include manufacturing processes, material compositions or recipes, are protected not by being registered but rather through secrecy and confidentiality. Trade secrets receive no protection in patent law, so companies must enforce these trade secrets by requiring their employees to sign things such as confidentiality clauses, and companies are responsible for protecting these trade secrets through contract and tort law.

What’s the difference between Environmental Assessment and Environmental Audit?

Environmental Assessment versus Environmental Audits: 

Both environmental site assessments or ESAs and environmental audits are conducted in accordance  with the Canadian Standard Association's guidelines, and though following either  guideline is not required by law, it is considered good professional practice. Since both guidelines contain legally accepted codes and standards, they usually represent a minimum practice standard that a court would hold a professional to. The main difference between an  ESA and an environmental audit is that an ESA is an assessment of an area, for example, land,  property, a site, whereas an audit is an evaluation of an organization or corporation and the environmental impact that they may have. An ESA is often required when land is being purchased, sold or if there is the potential for future development. In these scenarios, an ESA will assess a property for any potential contamination, and if contamination is found, it will recommend a remediation process. Often professional engineers and geoscientists  are part of the team that would conduct an ESA. An environmental audit, on the other hand,  is when an organization or corporation undertakes an audit for one of many reasons. For example, it may be to protect staff or others, to protect the corporation from any future liability claims or to assist in a defense should any statutory claim arise. These audits are internal evaluations that aim to verify the corporation's adherence to and compliance with legal requirements as well as the company's own policies and standards. These audits can identify compliance problems, weaknesses in systems and areas of risk.

What’s the difference between General Partnership and Limited Partnership?

General Partnership versus Limited Partnership:

General partnerships and limited partnerships are  two types of business structures in Canada. The main difference between the two is the level of  business-control and liability that each type of partner has. In a general partnership, two or more parties are the owners of a business. They are considered legal partners in one of two ways:  either the partners have signed a partnership agreement stating that they are partners, or they are automatically recognized as functioning as a partnership under the provincial Partnership Act if they jointly participate on an ongoing basis in the managing of a business. The Partnership Act assumes that each partner will gain an equal share of profits unless it is otherwise stated in the agreement.Additionally, the partners are equally responsible for the debts and the obligations of the business. In a general partnership, each partner is both jointly and severally liable for the business's debts. This means that each partner is equally liable for the business debts; however, if one partner cannot pay their share, the other is legally required to cover their share. Each partner also owes a fiduciary duty. This means that the partners must act in the best interest of their business and must not compete with or take profit from any other partner. A limited partnership exists when there is at least one general partner and one limited partner. A limited partner is only liable for their cash contribution or investment into the business. This means that they can lose their investment; however, they are not liable for any losses beyond this. Some provinces hold limited members liable to the amount of any profits that they have made from the business as well. Though they enjoy the benefit of less liability and risk, limited partners cannot actively participate in running the business or else they'll lose their limited partner status.

What’s the difference between Voiding a Contract and Terminating a Contract?

Voiding a Contract versus Terminating a Contract: 

Voiding and terminating a contract are both ways in which the agreements and obligations under a contract come to an end. All contracts must come to an end eventually; however, this is usually done by all or both parties fulfilling their obligations and all warranty periods coming to an end. However, voiding and terminating a contract are ending these obligations before they are met. The main difference is whether anything stated in the contract is still valid and enforceable. Terminating a contract is ending the relationship between two or more parties of a contract; however, everything up until the termination date is still valid and enforceable. Breaches of contract or frustration, which is an event that makes it impossible for the parties (or party) to fulfill their obligation, may cause a contract to terminate. further parties may mutually decide to terminate a contract  before all obligations are met. Conversely avoiding a contract means that the contract was never valid at any time, and therefore the agreements and obligations never legally started. Anything that happened in regards to the contract would not be legally enforceable. Courts rarely void a contract but may do so under certain circumstances, such as mutual and significant mistake, duress, misrepresentation, unconscionability, frustration or impossibility. Usually, this would occur in the real world if the object of the agreement was illegal or against public policy if the terms of the contract are impossible to fulfill, if there was a lack of consideration or if fraud has been committed. For example, if false representations were presented and one of the parties agreed to the terms of the contract based on those false facts, this would be considered fraud. If the court voids a contract, neither party is bound to it at any time, and neither party can rely on it.

If a party to a contract discloses confidential information about the other party, is it considered a fundamental breach?

The contract in place between the two parties should be developed by someone with a law background, and the area in that document that specifies confidential information release will be found in the confidentiality clause. This clause specifies what is determined to be confidential and the restrictions regarding disclosure of that information. There will also be an exclusion clause, which defines all the information that is not considered “secret”. If one party discloses information past the scope of what is defined in this clause, it could be considered a fundamental breach of contract.

When would a judge order specific performance?

Specific performance is used to resolve a contract dispute. A judge would order specific performance when a particular part of the contract can be carried out to resolve that dispute, it’s not going to be used in cases where the performance of something needs to be supervised or verified. (eg. Used for cases like the “sale of land”, but not something like “installation of machinery”.) 

What is the difference between mediation and arbitration?

In mediation, a mediator guides the two parties to a settlement, and the process is non-binding.  In Arbitration, the parties use an arbitrator that acts like a private judge, and they come up with a ruling that is typically binding, but in some cases, arbitration can be non-binding if both parties agree. Arbitration is a little more adversarial than mediation because of the ruling. Similar to how a court is more of a win-loss scenario as opposed to mediation which can be something that is seen to benefit both parties.

How long does copyright protection last? What happens after the protection ends?  

Copyright lasts for the Author’s life plus 50 years. After that time, it enters public domain, meaning that if you want to use the copyright, you don’t have to seek permission to do so.

Could you explain the difference between performance bond and holdback?

A performance bond is a way for the owner to ensure that the construction process will be completed so it asks the contractor to submit a bond, and by doing so, the contractor has to go to a surety company to issue them the bond, where they pay them some money, and if the contractor is unable to complete the project for any reason (going bankrupt etc.), then the surety would have to step in and complete the project, and usually they would just hire another contractor to carry out the work.

Holdback is a mechanism to set aside a certain amount of every progress draw to the general contractor, typically 10 percent, and set it aside so that if the subcontractors, suppliers, vendors, or anyone else does not file a lien by a certain date, then that money will be returned to the general contractor. If they do file a lien, then that money can be put towards paying those subcontractors or other parties who have not been paid or have been underpaid.