Solution Manual For Business Law in Canada, 11th Canadian Edition

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RESOURCEMANUALRichard A. YatesSimon Fraser UniversityRichard Yip-ChuckBUSINESS LAW INCANADAEleventh EditionRichard A. Yates, Teresa Bereznicki-Korol, Trevor Clarke

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iiContentsPrefacePart 1: Introduction1Managing Your Legal Affairs12Introduction to the Legal System63The Resolution of Disputes: The Courts and Alternatives to Litigation14Part 2: Torts4Intentional Torts and Torts Impacting Business245Negligence, Professional Liability, and Insurance31Part 3: Contracts6The Elements of a Contract: Consensus and Consideration397The Elements of a Contract: Capacity, Legality, and Intention498Factors Affecting the Contractual Relationship579The End of the Contractual Relationship63Part 4: Methods of Carrying On Business10 Agency and Partnership6911 Corporations7912 Employment89Part 5: Property and Information Technology13 Intellectual Property9814 Real and Personal Property and Protection of the Environment105Part 6: Commercial Transactions15 Priority of Creditors11316 Sales and Consumer Protection125AppendicesIntroductory Comments1331Recommendations for Teaching Business Law in Canada1342The Yates Cases1583Comments with Respect to the Yates Cases177A Note on the AppendicesThe first appendix to this manual consists of a research paper by Richard A. Yates onteaching business law. It summarizes trends and focuses on a teaching approach that ismodeled on the case study method of the Harvard School of Business. This researchprovided the impetus for the creation of the “Yates Cases,” which are included in thesecond appendix. The third appendix provides commentary on how they might be used ina business law course.

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1Chapter 1Managing Your Legal AffairsLearning ObjectivesExplain the meaning of “sophisticated client”Describe the role of the lawyerIdentify when to hire a lawyer and when to represent yourselfExplain how to find a good lawyerReview how lawyers bill their clientsDescribe legal aidOutline the procedure to follow to complain about your lawyerDiscuss the ethics of lawyers and of clientsDiscussionEXPLAIN THEMEANING OF“SOPHISTI-CATED CLIENT”A “sophisticated client” understands the role of the lawyer, and their own roleas client. This involves knowing when and how to hire a lawyer, the costsinvolved and what can be done if the lawyer is not meeting your expectations.Good business decisions can only be made with consideration of appropriatelaws, whether the client is able to access that information for themselves, orthrough the services of a lawyer. A sophisticated client also understands theimportance of evidence, and may change their procedures and those of thebusiness in order to make sure the evidence is there in the event of a dispute.DESCRIBE THEROLE OF THELAWYERThe client is the ultimate decision maker, but makes those decisions with theadvice of a number of experts, of which the lawyer is one. If the businessperson deems other business factors to be of greater importance, he or she maychoose to accept some legal risk, but it is an informed decision. Lawyers mustfollow the instructions of their clients unless they are illegal or unprofessional(although a lawyer may always resign).IDENTIFYWHEN TO HIREA LAWYERAND WHEN TOREPRESENTYOURSELFThe decision as to when to hire a lawyer starts when decisions need to be madeas to how the business will be organized, whether it is to create to a newbusiness or buy an existing one. It allows business owners to minimize theirrisks and make sure they are in compliance with all laws. This would also applytodecisionsaboutthepremises,financing,existingornewcontracts,intellectual property and, finally, selling the business. For less significantdecisions, the client may choose to inform themselves, through the internet andtheresourceslistedthroughoutthistextbookandinMyBusLawLab.A sophisticated client will know when to do research themselves and, if unableto obtain the information or understand the information found, to seek legaladvice. Small claims court trials are often conducted by clients, due to the lowmonetary limits, unless the legal issues are too complex for the client to handlethemselves. Criminal matters should nearly always be handled by legal counsel.EXPLAIN HOWFinding an appropriate lawyer is difficult. Referrals from trusted friends or

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Instructor’s Manual forBusiness Law in Canada, 11thEdition2TO FIND AGOODLAWYERassociates with the same type of legal problems are good. Some provincial lawsocieties or branches of the Canadian Bar Association also have lawyer referralservices that provide names of lawyers who practice in specific areas of law.You may have an initial consultation for little or no cost, and then decide ifyou wish to pursue the matter and hire one of them. If not going through one ofthose services, initial consultation costs will vary and should be confirmedwith the lawyer in advance. The lawyer you choose should be someone whoyou think may be suitable to establish an ongoing relationship with yourbusiness.REVIEWHOWLAWYERSBILL THEIRCLIENTSLawyers bill their clients for services either by a fixed fee, an hourly rate or bya contingency fee based on a percentage of the money recovered on behalf ofthe client. Clients are also responsible for paying disbursements, the lawyer’sout-of-pocket expenses incurred, such as filing fees, long-distance telephonecharges, etc. Sometimes a lawyer will require a financial retainer to start a file,which operates as a deposit against legal work performed.DESCRIBELEGAL AIDLegal aid may be available for people with low income, but the eligibility variesfrom province to province, so it’s best to check with the administrators of theprogram in your province. What types of legal services are covered also varies,and it is generally not available for business issues. Duty counsel is oftenavailableatnochargeincriminalcourttoprovideadvice,butnotrepresentation.OUTLINE THEPROCEDURETO FOLLOWTO COMPLAINABOUT YOURLAWYERLaw is a self-governing profession, with provincial law societies that serve thisfunction. Fee complaints are dealt with differently from province to province.Complaints about a lawyer’s conduct are dealt with through the law society,which will have a resolution process that could include mediation, investigationand formal hearings, with penalties for wrongdoing. Claims for compensationare subject to limitation periods, as is any other action.DISCUSS THEETHICS OFLAWYERSProfessionalandethicalobligationsoflawyersaresetoutinrulesofprofessional conduct established by each province’s law society. The vastmajority of lawyers meet these standards, but as with any profession, there are afew that do not. If this occurs, the client needs to take appropriate action on atimely basis.DESCRIBE ACODE OFBUSINESSCONDUCTThere is no code of conduct for business people, and there have recently beena number of well publicized examples of breaches of ethical conduct by highprofile business people. This affects the public’s perception of the integrity ofenterprises in our country and the advisability of doing business here. Eachbusiness should make a commitment to ethical behaviour by preparing a codeof conduct for their employees. It needs to include issues such as conflictsof interest, use of corporate assets and opportunities, confidentiality, fairdealing, compliance with laws and reporting of unethical or illegal behaviourwithin the business. It needs to reflect the business’ core ethical values andprinciples, in order to encourage ethical behaviour on the part of all thoseassociated with the business. This, in turn, can enhance the long term successof the business.Answers to Questions

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Chapter 1: Managing Your Legal Affairs31.Explain the meaning of “sophisticated client”.Sophisticated clients are confident, knowledgeable, up-to-date and understand the role of alawyer. As well, they know when to represent themselves and when to hire a lawyer, and thecosts involved when a lawyer is hired.2.Why should the owner of a small business have a lawyer on “the team”?A lawyer is an expert, providing relevant advice to the client, which allows the client to makean informed decision.3.Distinguish the role of the client from the role of the lawyer.The client is the decision maker, who consults a number of experts, including lawyers, inorder to make decisions. Lawyers are experts in their field who provide advice, and who mustfollow the instructions of the client.4.“The elimination of ‘solicitor–client privilege’ would significantly undermine theintegrity of the Canadian legal system.” True or false? Explain your answer.True. Solicitor-client privilege ensures full and frank disclosure between clients and theirlawyers. The value of the lawyer’s advice will be greatly reduced if it is based on incompleteinformation.5.What are some examples of decisions that owners of small businesses make? What rolecan a lawyer play with respect to the making of these decisions?The legal form of the business, whether to buy an existing business or create a new one, whatare the relevant laws and regulations affecting the business and what constitutes compliance,issues with regard to purchase or lease of business premises, funding of the business,contracts with employees, suppliers and customers, intellectual property and, finally, sale ofthe business.6.What role has the computer played with respect to the solicitor-client relationship?Computers allow clients to research easily accessible legal information online, rather thanhaving to consult a lawyer for every decision.7.“It is a good idea to hire a lawyer when you have been charged with a crime.” True orfalse? Explain your answer.True. The stakes are high. If convicted, you will be punished and have a criminal record.8.When you are trying to find a lawyer to help you, what are some sources of lawyer’snames?Sources include referrals from friends or relatives, provincial law societies, lawyer referralservices, provincial branches of the Canadian Bar Association, advertisements and theYellow pages.

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Instructor’s Manual forBusiness Law in Canada, 11thEdition49.What is the primary purpose of an initial consultation with a lawyer?To decide whether the lawyer is suitable for you to retain. If so, then the lawyer will decide ifit is agreeable to represent you.10. Briefly explain three ways lawyers bill their clients. Which of the three is mostcommonly used?Fixed fees – for specific tasks such as will preparation, purchasing a house or incorporation.Hourly rate – billing for time spent on the client’s file. This is the most common method ofbilling a business.Contingency fee – charging a percentage of the amount the client collects. Most appropriatefor personal injury or product liability cases. If the client does not collect, the lawyer does notget a fee. The types of cases covered and allowable percentages vary from province toprovince.11. “Legal aid is available to anybody with a legal problem.” True or false? Explain youranswer.False. There are financial limitations and limitations on the types of disputes legal aid willdeal with. This also varies from province to province.12. What can a client do if she is unhappy with the bill she received from her lawyer?Attempt to resolve the dispute directly with the lawyer. If not successful, mediation may bean option. If mediation is not available or successful, the bill could be reviewed by courtofficials. The method of review varies from province to province.13. “Should a client lose money because of the carelessness of his lawyer, he will becompensated for his losses if he makes a complaint to the law society.” True or false?Explain your answer.False. The Law Society deals with disciplinary matters only in respect of the carelessness.Compensation would have to result from settlement or, if unable to reach an agreement,through a legal suit by the client against the lawyer. The Law Society will likely require thelawyer to have errors and omissions insurance which will assist with recovery of the loss aftersettlement or judgment.14. When will a lawyer be disbarred?Lawyers who fail to follow the rules of conduct of the Law Society they belong to are subjectto disciplinary investigations and hearings. If the conduct complained of is a serious breach,such as misuse of client funds, they may be disbarred.15. “When a person acts unethically, she will also have broken the law.” True or false?Explain your answer.False. Ethics tells us what we should do; the law tells us what we must do. Generallyspeaking, every person breaking the law in Canada is acting unethically, but a breach ofethics is not necessarily breaking the law.

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Chapter 1: Managing Your Legal Affairs516. What is a code of business conduct? Should such a code be used by a small business?A code of business conduct is a statement of values and principles of ethical behaviour thatestablishes a code of conduct which all employees, officers and directors of the businesswould be expected to follow. If created when a small business is first established, it isprobably the best way to ensure the long-term adoption of these principles as the businessgrows.Solution to the Cases1. Ontario (Public Safety and Security) v. Criminal Lawyers’ Association, [2010] 1 S.C.R.815, 2010 SCC 23The Supreme Court unanimously reversed the decision of the Court of Appeal. Section 2(b)of theCharterdoes not guarantee access to all government documents. The documentsprotected by the OntarioFIPPAdealing with solicitor-client privilege were excluded frombeing disclosed. Lawyers required to register as lobbyists may have to disclose client namesand the nature of the lobbying activity. Some banking records of lawyers regarding clientnames and information may be accessible under money laundering and state securitylegislation.2.Wayne v. Wayne, 2012 ABQB 763 (CanLII)Relevant legislation does not expressly allow the court to pierce the solicitor-client privilege.The basis for this is for clients to have complete trust their counsel representing them.Counsel can only represent clients if clients are completely open and speak freely withcounsel. The privilege is for the benefit of the client. In this case, the mental state of thetrustee’s mother, the privilege does not work to her benefit. The court should grant access tothe estate file.3.University of Alberta v. Chang, 2012 ABCA 324 (CanLII)The appeals were allowed and the applications were remitted for trial. The chambers judgecopied and pasted the briefs filed by the parties and simply retyped them. He signed then asreason for judgment. Briefs are often one-sided so they so they were prepared in anadversarial context. The passages from the chambers briefs did not disclose who thechambers judge arrived at his decision. There was no evidence to suggest there wasinordinate delay.The appellate court must rebut the presumption that the lower court has reached its decisionthrough its own unbiased analysis to overturn the decision of the lower court.

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6Chapter 2Introduction to the Legal SystemLearning ObjectivesDefine “law” and identify the types of law that exist in CanadaDistinguish between the civil law and common law legal systems found in CanadaIdentify the sources of Canadian lawIsolate the three elements of Canada’s ConstitutionExplain how legislative power is divided in the ConstitutionDetail how legislation is created in the parliamentary systemDescribe the rights and freedoms protected by theCharter of Rights and FreedomsList the areas and grounds upon which human rights legislation prohibits discriminationDiscussionDETERMINE AWORKABLEDEFINITION OF“LAW”Although creating a comprehensive definition of the law is difficult, aworkable definition for our purposes is: “Law is that body of rules which canbe enforced by the courts or by other government agencies.” An essentialaspect of rules being considered as law is that they can be enforced by thejudicial system or through administrative process.IDENTIFY THECATEGORIES OFLAW THAT EXISTINCANADASubstantive Law – rules that establish rights and place limits on individualconductProcedural Law – rules governing how the substantive law will be enforcedPublic Law – rules that govern an individual’s relationship with government(e.g. the Constitution)Private Law – rules that govern personal, social and business relationshipswhich can be enforced by one person suing anotherDISTINGUISHBETWEENCOMMON LAWAND CIVIL LAWThe two main legal systems in place in the western world are civil law andcommon law. The civil law originated with the Romans and finds its modernplace in the Napoleonic Code of France and other civil codes, including theQuebecCivilCode.TheCommonlawisusedinEnglandandotherjurisdictions where the English conquered and colonized. In a civil lawjurisdiction, the basic rules and general principles are embodied in a centralcode and the function of judges is to apply the code to the specific cases thatcome before them. In such a system prior cases or precedents are merelypersuasive and play a much less significant role than in the common lawsystem, which has as its main characteristic the principle ofstare decisisorthe application of precedent cases. In the common law system, prior cases inthe same court system with similar facts are binding on subsequent decisionmakers. Both the civil law and common law system provide predictability,which facilitates stability in a society.

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Chapter 2: Introduction to the Legal System7IDENTIFY THESOURCES OFCANADIAN LAWAs judges created the body of laws known as the common law, theyborrowed from several sources including the traditions of communities wherecourt was conducted, including canon (Church) law, the law merchant, andthe civil law of Rome. Due to the strictures ofstare decisis, there wasextreme difficulty modifying common law precedents. As a result the courtsof equity were separately developed to provide relief from the inadequaciesof the common law system. A considerable amount of conflict developedbetween the two courts until they were eventually merged by theJudicatureActsin 1873-1875. However the two bodies of law remain distinct, and eachcan be applied by a single judge in a case.. The principle of supremacy ofParliament, developed in England and brought into Canada, means acts ofParliament or of a Provincial Legislature e will override any conflicting ruledeveloped by either the common law, rules of equity, or a prior statute. Todayin Canada, in order to determine what law should be applied to a particularsituation, we must look to common law, to equity, and to statutes.IDENTIFY THETHREE ELEMENTSOFCANADA’SCONSTITUTION1.Statutes,suchastheConstitutionAct,1867BNAACT),andtheConstitution Act, 1982, including the Charter of Rights and Freedoms,2.Conventions and traditions, which are unwritten customs and rulesdictating how the government is to operate. They include the rule oflaw, the office of Prime Minister and political parties.3.Case law on constitutional issues, such as whether the federal orprovincial government has jurisdiction to create certain statutes.DESCRIBE THECONSTITUTIONACT,1867,ANDEXPLAIN HOWLEGISLATIVEPOWER ISDIVIDED IN THECONSTITUTIONIt was often necessary to turn to the U.K. Parliament to amend or change theConstitution Act, 1867until 1982. It was then that theCanada Actwasenacted in the U.K. (called theConstitution Act, 1982in Canada). It gaveCanada the power to always amend its own constitution and contained theCharter of Rights and Freedoms. Until this time the principle of supremacyof Parliament prevailed and while a court could determine which level ofgovernment had the power to pass particular legislation, the court could notsay the legislation was beyond the power of both levels of government. WiththeCharter of Rights and Freedoms, however, that power is now given tothe court.TheConstitution Act, 1867assigned different legislative powers to thefederal and provincial governments. The powers of the federal governmentare set out primarily in section 91 of theConstitution Act, 1867, and thoseof the provincial governments in section 92. The federal government haspower over matters of broader national concern such as banking, currency,thepostalservice,criminallaw(althoughnotitsadministrationandenforcement), and the appointment of judges in the federal and higher-levelcourts of the provinces. The provinces have jurisdiction over such matters ashospitals, education, the administration of the justices, and commercialactivities carried on at the provincial level.DETAIL HOWLEGISLATION ISCREATED IN THEPARLIAMENTARYSYSTEMLegislation is created by both the federal and provincial governments. Theprocess involves the drafting and presentation of a Bill in either the federalHouseofCommonsortheprovincialLegislativeAssembly.Whenintroduced, a Bill will be given a first reading and is normally passed with

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Instructor’s Manual forBusiness Law in Canada, 11thEdition8little debate. If there is a will among the members to move the Billforward, it will then be presented to the legislature for a second reading.There it is debated by the members of the house and either approved orrejected. If the Bill is approved it will generally go to a committee ofmembers for review for possible amendment. When the Bill is in finalform, it is presented to the legislature for Third Reading which involves afinal debate and a vote. If the Bill passes all the votes, it is submitted toeither the Governor General or the Lieutenant Governor for Royal Assent.Once assent is given the new legislation will either come into effectimmediately or more commonly now, later upon further proclamationby Cabinet.DESCRIBE THERIGHTS ANDFREEDOMSPROTECTED BYTHECHARTER OFRIGHTS ANDFREEDOMSTheCanadian Bill of Rightswas a largely ineffective attempt to protectthe basic rights of citizens from interference by government. However,theCharter of Rights and Freedoms, being constitutionally entrenched, isvery effective. TheChartersets out certain basic rights, privileges andfreedoms possessed variously by Canadians, non-Canadians in Canada, andcorporations that cannot be interfered with by any level of governmentor government official without a constitutional amendment. TheCharterisapplicabletoanyrelationshipsexistingbetweenindividualsandgovernmentsorgovernmentagenciesandcoverspersonalfreedoms(freedom of speech), democratic rights (the right to vote), mobility rights,legal rights (a fair trial), equality rights (racial discrimination) and languagerights (French and English).There arethreeimportant qualifications on the operation of theCharter ofRights and Freedoms.Firstthe operation of the charter is restricted to anindividual’sdealingswithgovernmentsandgovernmentagencies.Thesecondallows the provinces or the federal government in many areas to optout of the operation of the Charter and thethirdallows exceptions where“reasonable” in a free and democratic society. The effect of theCharteris totransfer the burden of protecting our basic rights and freedoms from ourparliamentarians to our courts. These last two exceptions shift the burdenback to a degree and restore some supremacy of Parliament. TheCharterdoes not protect an individual’s rights from violation by other individuals ornon-governmentinstitutions.Suchhumanrightsdisputesbetweenindividualsarehandledbyhumanrightscommissionscreatedundercomprehensive provincial and federal human rights statutes. That is, theCharterprotects us from government, and human rights legislation protectsus from each other.LIST THE AREASAND GROUNDSUPON WHICHHUMAN RIGHTSLEGISLATIONPROHIBITSDISCRIMINATIONNotalldiscriminationisillegal.Humanrightslegislationprohibitsdiscrimination on certain grounds, such as gender, religion, ethnic origin,race, age and disabilities. The legislation only prohibits this discrimination incertain areas, such as employment, tenancies, public facilities, services, andsigns. Outside of these grounds and areas, discrimination can still legallyoccur. Sometimes positive action must be taken to avoid discrimination.That is there is a duty to accommodate different genders, the disabled andetc. when there is not undue hardship to do so.

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Chapter 2: Introduction to the Legal System9Answers to Questionsl.Why is it difficult to come up with a satisfactory definition of law?The main point that students should raise is that a definition of “law” varies with theperception and preferences of the person being asked the question. Someone committed to anempirical approachmight adopt the definition of the legal positivist. That is, law isdetermined by the authority of the body that passed it. A pragmatist would lean toward theAmerican legal realist’s definition. That is, law is whatever a judge is willing to enforce. Thepoint is that the student should understand that the definition of law cannot be separated fromthe philosophical stance of the person responding to the question.2.Where do we look to predict the outcome of a legal dispute?(a) In a common law system?Predictability of the law is determined by precedent-making cases.(b) In a civil law system?Predictability of the law is determined by the central civil code.3.Explainhowtheuseofpreviousdecisionsdiffersincivillawandcommonlawjurisdictions.In a civil law jurisdiction only the code is binding on the judge. Cases decided by otherjudges are merely persuasive. They can be turned to for guidance but the judge is not boundby them. However, cases in a common law jurisdiction are the binding aspect of the law and,therefore, if a particular case qualifies as a precedent the judge faced with that precedent mustfollow it.4.Describe what is meant by the statement, “Common law judges did not make the law,they found it.”When the common law was originally introduced in England it was the legal structure thatwas imposed, not the rules of law themselves. The judges merely applied the law or rules thatwere already in place with the “common people” in the local jurisdictions. From this arosethe concept that the common law was not imposed but merely found. In reality this can onlybe applied to a small portion of the common law. In fact, as the common law developed,judges borrowed from many different sources, such as civil law, canon law, the lawmerchant, etc. As well, statutes have been passed which considerably alter judge made law.5.Describe the advantages and disadvantages of the system ofstare decisis.The main advantage tostare decisis(or the process of following precedent) is the stabilityand predictability that it provides for the legal system. It is not always necessary for someoneto go to court to find out how the law will be applied in a given situation. Precedent casescan supply that information, and the parties may avoid the cost and difficulties associatedwith a court action by settling the dispute. Another advantage to the system is that wherethere is no precedent covering a particular situation before the court, the court then is free tomake such precedent. The main disadvantage of thestare decisisprocess is that, as thenumber of precedents grows, the courts are unable to change and adapt as the attitudes ofsociety alter. The courts often find themselves applying rules established centuries earlier

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Instructor’s Manual forBusiness Law in Canada, 11thEdition10which (other than the fact that they form a precedent) may have no justification for beingapplied in a modern situation. Happily statutes have altered many laws set by precedent andwhich no longer have a modern use.6.Describe the problems with the common law system that led to the development of thelaw of equity.Because ofstare decisisamong other things the common law became rigid in its procedureand inflexible in the rules that were applied. Similarly, the remedies that were applied werelimited. The problems were not corrected internally and, therefore, the courts of chancerydeveloped to provide relief in those situations where it was warranted.7.Detail what was accomplished by theJudicature Actsof l873-75.TheJudicature Acts(1873-75) rationalized the various different court structures in place inEngland before this time into one central court system called the English High Court ofJustice. Thus the separate courts of chancery and common law ceased to exist, although theseparate bodies of law developed by them continued to exist.8.Explain what is meant by the phrase, “the supremacy of Parliament.”In the English and Canadian legal system Parliament is supreme. A statute enacted byParliament becomes the definitive law of the land overriding any other rule or law, such ascommon law, precedent, etc. This must be contrasted to the American system which has asystem of checks and balances between the executive, legislative and judicial branches ofgovernment and under various circumstances each branch of government can override whatthe other does. In Canada the supremacy of Parliament is now subject to the operation of theCharter of Rights and Freedoms.9.What effect will a properly passed statute have on inconsistent judge-made law (case law)?Because of the principle of supremacy of Parliament such a “properly passed” statute willoverride any inconsistent judge-made law.10. Outline how a parliamentary bill becomes law.A new law goes through a process of introduction in the form of a bill, debate, modification,and approval referred to as first, second and third reading and then receives royal assent fromthe Governor General or Lieutenant Governors.11. Using the principles ofstare decisis, explain how judges determine whether or not theyare bound by another judge’s decision in a similar case.Judges are bound by the precedent-making decision of other judges who are in the samejudicial system at the same or a higher rank.. Thus a Supreme Court of Canada decision isbinding on the Ontario Superior Court of Justice and an Alberta Court of Appeal decision isbinding on a Court of Queen’s Bench of Alberta judge. However an Ontario Superior Courtof Justice decision is not binding on a judge in the courts of any other province. Secondly, thejudge must determine whether the case presented as a precedent covers essentially the samefacts or whether it can be distinguished. If the facts can be distinguished or differentiatedthe case is not a binding precedent.

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Chapter 2: Introduction to the Legal System1112.What is included in Canada’s Constitution?Legislation, conventions and court decisions considering the constitution form Canada’sConstitution. The British North America Act (now Constitution Act, 1867) is part of thelegislation in the Canadian constitution. The legislation in the Canadian constitution alsocontains many subsequent important documents, such as: the Statute of Westminster (1931),theConstitutionAct(1982)includingtheCharterofRights andFreedoms,plusanyamendments that have taken place. The various statutes having constitutional standing inCanada are now listed in an appendix to the Constitution Act (1982). In addition to these, theCanadian constitution contains all of the great provisions of England’s constitution, such as:theMagnaCarta,theEnglishBillofRights,andthemanyunwrittenconstitutionalconventions, such as the principle of the rule of law. Court decisions considering theconstitution form binding precedents that become part of the Canada’s constitution.13. What is the effect of sections 91 and 92 of theConstitution Act, 1867formerly theBritishNorth America Act?Sections 91 and 92 of theConstitution Act, 1867divide powers between the federal andprovincial governments. Section 91 assigns certain areas of legislative power to the federalgovernment and Section 92 assigns other powers to the provincial governments. It is thisseparation of powers between the federal and provincial governments that is the foundation ofour federal system.14. How did theConstitution Act, 1867limit the power of the federal and provincialgovernments? How is it possible, given that division of powers, to have identicalprovisions in both federal and provincial legislation and have both be valid?TheConstitution Act, 1867originally referred to as theBritish North America Act, assignscertain areas of governmental control to either the federal or provincial governments for theirexclusive jurisdiction. Since theActdeals with types of legislation there may be overlapbetween the powers of the two levels of government. For example, the provincial governmentcan pass legislation making a particular type of activity illegal because it interferes withhealth and the federal government can make that same activity illegal because it is a crime.15. Explain what is meant by the doctrine of paramountcy. When does the doctrine apply?Since it is possible to have valid federal and valid provincial legislation dealing with the sameactivity, it is also possible to have conflict. When it is not possible for a person to obey bothlaws the doctrine of paramountcy declares that the federal legislation must be obeyed and thatthe provincial legislation is inoperative to the extent of the conflict.16. Describe the limitations on the federal or provincial governments’ power to delegatetheir authority to make laws.The federal and provincial governments cannot delegate their power to make laws. They candelegate the administration of the laws to another body, such as an administrative tribunal.17. Identify the limitations of human rights legislation. Does it address all discrimination?It only addresses the grounds for discrimination in the areas of society which are described inthe legislation. For example, in most jurisdictions a restaurant is legally able to only hire

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Instructor’s Manual forBusiness Law in Canada, 11thEdition12attractive servers, so long as they do not discriminate against any applicants on any of theprohibited grounds such as age or physical disability..18. Explain how theConstitution Act, l982,including theCharter of Rights and Freedomsaffects the doctrine of supremacy of Parliament.The Constitution Act, 1982, including theCharter of Rights and Freedoms, places many areasbeyond the power of either the provincial or federal governments. Many important rights andfreedoms as set out in theChartercannot be changed or modified without a constitutionalamendment, so in those areas Parliament is no longer supreme. The courts now have thepower to declare legislation passed by either the provincial or federal governments asunconstitutional, not because it encroaches on the other’s jurisdiction but simply because it isinconsistent with theCharter of Rights and Freedoms.19. Explain any limitations that apply to the rights and freedoms listed in theCharter.Section 1 limits our rights when reasonable to do so in a free and democratic society. Section33 allows government to pass legislation contrary to certain sections of theCharteras long asthey state they are doing so at the time. The exemption lasts for only five years but may berenewed at the end of that period.20. Give examples of democratic rights, mobility rights, legal rights, and equality rights asprotected under theCharter. Give examples of three other types of rights protectedunder theCharter.Democratic rights - right to vote, that elections be held. Mobility rights - the right for citizensto live, work and travel freely in Canada. Legal rights - right to life, liberty, security. Equalityrights - the right not to be discriminated against on the basis of sex, religion, race, nationalorigin, etc. Personal freedoms - freedom of conscience, religion, belief, opinion, expression.Language rights - French and English are guaranteed as the official languages of Canada.21. How do human rights codes differ in their application from theCharter of Rights andFreedoms.TheCharteronly deals with our relationships with government and government institutions.The human rights codes govern our relationships with each other and non governmentalinstitutions such as corporations.Solutions to Cases1.R. v. Clough, 2001 BCCA 613 (CanLII)Clough could argue the trial judge was to take in consideration the court’s judgment forKozma to receive a conditional sentence. The trial judge was not supposed to pass his ownjudgment on the court’s ruling of Kozma. Clough could then argue that her circumstanceswere similar to Kozma and trial judge should impose the same conditional sentencing.Clough could argue on the principle ofstare decisisthat the judge of the BC court should bebound by the decision of the judge of the BC Appeals court since they are in the same judicialsystem.

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Chapter 2: Introduction to the Legal System132.R. v. Spratt, [2008] B.C.J. No. 1669 (B.C.C.A.), 2008 BCCA 340 (CanLII); applicationfor leave to appeal to S.C.C. dismissed June 18, 2009.The British Columbia Court of Appeal held that the intent of theAccess to Abortion ServicesActto allow safe access to health care services justified a limitation on the freedom ofexpression protected under Section 2 of theCharter. The court pointed out it was only smalllimitation and therefore the rights of the patients were found to be paramount.3.McKay-Panos v. Air Canada, [2006] F.C.J. No. 28; 2006 FCA 8, [2006] 4 FCR 3(CanLII).TheFederalCourtofAppealheldthattheseatisan“obstacle”undertheCanadaTransportation Act. The obese appellant was found to have a disability under theAct. Thisfinding of a “disability” would be a precedent to be argued if an accommodation is soughtunder theCanada Human Rights Act.

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