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In previous blogs, we have discussed what happens to frozen embryos when a couple breaks up and how to address the possibility of children born after your death through assisted reproduction technologies. But how will your stored reproductive material be dealt with after your death? Will the material be disposed of, or does the material form part of your estate to be passed on to a selected beneficiary?

While reproductive material may be considered property that forms part of your estate, the use of reproductive material in Canada is strictly governed by the Assisted Human Reproduction Act, S.C. 2004, c. 2 (“AHRA”). The AHRA is a consent-based regime; any reproductive material cannot be used without the donor’s consent, as prescribed by the Consent for Use of Human Reproductive Material and In Vitro Embryos Regulations, SOR/2007-137 (the “Regulations”).

The AHRA addresses three types of reproductive material: reproductive material used to create an embryo, reproductive material posthumously retrieved from a donor, and in vitro embryos, each governed by sections 8(1)-(3), respectively. In each case, the reproductive material cannot be used without the donor’s written and informed consent.

Consent under the AHRA The Regulations set out how consent to use someone’s reproductive material must be given (and withdrawn) and the purposes for which consent can be given.

The Regulations emphasize that consent must be both informed and in writing. When providing consent, donors must sign a document confirming that they were informed in writing of the permitted purposes for the reproductive material, how consent may be withdrawn, that in vitro embryos may be created in excess of his reproductive needs, and how excess embryos can be dealt with.[1] The consent provided by the donor must also indicate the specific purpose for which the reproductive material can be used.[2]

Additionally, consent must be given by someone who is legally competent, not under duress or upon the promise of a reward, and over the age of eighteen.

The Regulations limit the permissible purposes to one or more of the following:

the donor’s own reproductive use;
the reproductive use of a third party;
improving assisted reproduction procedures;
providing instruction in assisted reproduction procedures; or
if the reproductive material is an embryo, for a specific research project.

If the reproductive material is removed from the donor posthumously, the material can only be used by the donor’s spouse or common law partner, for improving assisted reproduction procedures, or providing instruction in assisted reproduction procedures.

If the reproductive material is an embryo and the donors were a couple, then the consent may be withdrawn by either spouse or partner. Spouses or common law partners will continue to be considered donors of an embryo even after the breakdown of their relationship and if neither spouse or partner contributed reproductive material to the embryo.[3] The only way that an individual’s “donor status” can be removed is if one spouse or partner contributed genetic material to the embryo and one did not; in that case, upon the breakdown of the relationship, the spouse or partner who contributed genetic material to the embryo is considered the sole donor.[4]

What if I Don’t Provide my Consent?Broadly speaking, the AHRA does not permit a donor’s reproductive material to be used without written consent. In Ontario, courts have strictly followed the consent-based regime.

In SH v. DH,[5] the Court of Appeal denied a woman’s request to use the embryo created during her marriage to her ex-husband when her ex-husband withdrew his consent. Even though neither spouse’s reproductive material was used to create the embryo and the couple had divorced, they were both considered “donors” under the AHRA; as such, consent was required from both parties.

Likewise, in Singh v. Mount Sinai Fertility Centre,[6]** the court denied the applicants’ request to use the frozen sperm of their late son to create an embryo. Although their son had signed a form consenting for his sperm to be used in the future or after his death, and their son had verbally expressed his wishes that it be used by his parents to create a child after his death, the consent did not provide for reproductive use by a third party after his death.

There may be an exception if the court finds that there was implied consent. In KLW v. Genesis Fertility Centre,[7] the British Columbia Superior Court granted a widow’s application to use her late husband’s frozen sperm to have a child, even though he did not provide written consent pursuant to the AHRA. The court concluded that the sperm was property, formed part of his estate, and was passed to his wife upon his death. Notably, the court also emphasized that the couple had planned to use the sperm for this purpose and were unaware of the requirements for written consent; as such, the late husband’s consent could be implied in the circumstances.

Drafting a Will to Include Reproductive Material As this blog shows, it is not enough for you to simply state your preferences regarding reproductive material in your Will; if you want your partner or another third party to be able to use the material after your death, there are specific legal requirements that must be met. Namely, you must provide explicit written consent for the intended use of your reproductive material, and the purpose must be one that is allowable under the AHRA. You should also consider the following:

Estate Trustee: Ensure that the estate trustee named in your Will knows your wishes regarding your stored reproductive material and has instructions on how to access or retrieve it after your death.
Posthumous Conception: If you have a plan to have your reproductive material used after your death, you should consider the possible impact of posthumously-born children. Under the Succession Law Reform Act, S.O. 1990, c. S.26, a child conceived and born alive after your death may have a claim to your estate under the rules of intestacy and have standing to make a dependant support claim against your estate. When preparing your Will, also consider whether you want to include any children conceived and born after your death.

If you have any questions about how to address stored reproductive material in your estate planning, please contact Esther Abecassis at 416-446-3310 or esther.abecassis@devrylaw.ca, or another lawyer in our Wills and Estate Group.

This blog was co-authored by Articling Student, Leslie Haddock.

This article is intended to inform. Its content does not constitute legal advice and should not be relied on as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.

[1] Consent for Use of Human Reproductive Material and In Vitro Embryos Regulations, SOR/2007-137, enacted pursuant to the Assisted Human Reproduction Act, S.C. 2004, c. 2, ss 3, 7, and 12 [Regulations].

[2] Ibid, ss 4, 8, and 13.

[3] SH v DH, 2019 ONCA 454 at paras 43-46 [SH].

[4] Ibid at para 46; Regulations, supra, s 10(3).

[5] SH, supra.

[6] 2024 ONSC 2853.

[7] 2016 BCSC 1621.

The post Can I Include My Frozen Eggs in my Will?: Reproductive Material in Estate Planning first appeared on Devry Smith Frank LLP.

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Earlier this year, the Superior Court of Ontario released its decision in Zapata, et al. v. Reid, et al., dismissing the plaintiffs’ personal injury claim on a summary judgment motion from the defendants.[1] This case addresses the burden of proof and standard of care in negligence claims involving the inevitable accident principle and highlights the utility of summary judgment motions.

Background In July 2017, the defendant driver suffered a seizure and lost control of his vehicle while driving home from work. He struck two other vehicles before colliding with the vehicle carrying the plaintiffs.

The defendant was undergoing treatment for brain cancer at the time. His license had been suspended by the Ministry of Transportation of Ontario in 2016 due to an earlier seizure; however, his license was reinstated later that year upon his doctor’s recommendation that he was fit to drive. At the time of the accident, he was taking anti-seizure medication per his doctor’s recommendations, and had been seizure free for eighteen months.

Five months after the accident, the defendant died of brain cancer.

The plaintiffs brought a personal injury action for damages arising from the accident and the defendant’s alleged negligence in continuing to drive with his history of seizures. The defendant’s estate brought a summary judgment motion to dismiss the claim, claiming that no trial is needed to prove the circumstances of the accident or the defendant’s efforts to prevent the seizure. As the defendant took reasonable care in the circumstances, he was not negligent and the claim should be dismissed. The plaintiffs opposed the motion and argued that, as the accident was an “inevitable accident,” the burden to disprove negligence rests on the estate, and that a trial court could find that the defendant ought to have eliminated the risk of a seizure by not driving.

Summary Judgment Pursuant to Rule 20.04(2) of the Rules of Civil Procedures, the court must grant summary judgment if there is no genuine issue requiring a trial based on the evidence available. If necessary, the judge may also utilize the three fact-finding powers in Rule 20.04(2.1): weighing the evidence, evaluating the credibility of a deponent, and drawing any reasonable inference from the evidence.

The Court determined that this was an appropriate case for summary judgment. The disposition of the action depended on the interpretation of the applicable law; the only live factual dispute was whether the defendant’s doctors ought to have taken steps to prevent the accident in giving the defendant different advice about driving and not reinstating his suspended license.

The Court identified three possible outcomes for the motion:[2]

If the governing law is general negligence, as the defendants suggested, the motion could dismiss the action without using the additional fact-finding powers under r. 20.04(2.1). Both parties’ experts agreed that it was reasonable for the defendant to have followed medical advice and continued to drive while taking seizure medication.
If the inevitable accident principle requires a departure from ordinary negligence law and requires the defendant to bear the burden to disprove negligence:
1. The Court could dismiss the motion and consider whether to resume the hearing with the additional fact-finding powers under r. 20.04(2.1) or send the matter to trial to determine whether the defendant should have stopped driving to eliminate the risk of a seizure. However, the only live factual dispute was whether the defendant’s doctors should have given him different advice regarding driving, which would not impact the outcome of the trial.
2. The Court could grant summary judgment for the plaintiffs, if it determined that that the law required the defendant to abstain from driving entirely while on medication for seizures.

The “Inevitable Accident” Principle The case turned on the proper application of the “inevitable accident” principle.

The plaintiffs suggested that establishing an “inevitable accident” places an affirmative defence obligation on the defendant, requiring him to establish that he had done the utmost to prevent the accident. This heightened standard of care required the defendant to stop driving if some risk of a seizure remained.[3]

In contrast, the estate interpreted the Supreme Court decision of Rintoul v. X-Ray and Radium Industries Ltd.[4] as concluding that, where a prima facie case of negligence is established, the defendant can discharge their burden of proving that the accident was not caused by their negligence by showing that the accident was inevitable. In other words, that the accident could not have been prevented despite the defendant exercising reasonable care.[5]

The Court confirmed that Rintoul was the leading authority on the inevitable accident principle; however, the inevitable accident principle was not an affirmative defence or a requirement to disprove negligence, but simply a denial of negligence.[6]

The estate’s plea of inevitable accident, based on the approach in Rintoul, raised three subsidiary issues: the defendant’s burden of proof, the applicable standard of care, and the application of the burden of proof and standard of care.

Defendant’s Burden of Proof

The Court noted that Rintoul should not be interpreted as transferring the legal burden of proving negligence from the plaintiff to the defendant when inevitable accident is plead. The burden of proof in negligence does not shift to the defendant absent statutory provisions or legal presumptions. For instance, in rear-end collisions, the burden of proof shifts to the defendant to disprove negligence from the presumption that the driver followed too closely and from a positive obligation to not follow other cars too closely under s. 158(1) of the Highway Traffic Act.[7]** In this case, there is no legal ground to reverse the burden of proof to the defendant; the onus remains on the plaintiff to show that the defendant was negligent.

The Court also emphasized that the “inevitable accident” principle is not a legal defence, but a defence to an inference that the court is free to draw from the plaintiffs’ case. If the inference of negligence is strong (i.e. in cases involving rear-end collisions) or if the risk was serious (i.e. the sudden incapacitation of a driver), the defendant has an evidentiary burden to rebut the court’s inference that they were negligent in the circumstances.[8]

Applicable Standard of Care

The standard of care in negligence is the exercise of reasonable care. As negligence law does not require a defendant to eliminate all potential risk, a defendant will not be liable simply because more could have been done than what was objectively reasonable. An “inevitable accident” is not a special category of negligence with an elevated standard of care; the defendant’s driving is subject to the same reasonable care standard.[9] Specifically, the Court held that a driver losing consciousness and control of their vehicle due to an involuntary medical event does not have a higher standard of care than those whose conscious decisions and risk-taking cause accidents.[10]

Application of the Burden of Proof and Standard of Care

In this case, the plaintiffs were unable to prove that the defendant failed to exercise reasonable care and that his decision to drive, despite the risk of seizures, was unreasonable:

The defendant’s license had been reinstated;
He was able to work full-time in construction and live independently;
He was 18 months seizure-free at the time of the accident;
His doctors were aware that he drove and did not advise him against it;
His neurologist assessed him as seizure-free while on medication ten days prior to the accident;
He was fully compliant with all medical recommendations, and did not drive when his license was suspended in 2016; and
None of his medications increased his risks of seizures or counter-acted his seizure medication.[11]

The medical evidence indicates that the defendant’s seizure occurred, despite reasonable precautions being taken. The fact that a reasonable person knows or ought to know that medications can stop working does not make it unreasonable to drive with that risk; to impose liability on such drivers would effectively impose a strict liability regime. There was nothing the defendant could have reasonably done to prevent the accident, short of refraining from driving. As the evidence clearly shows that the defendant was not negligent, there is no defence evidentiary burden and the defendants do not have to disprove the defendant’s negligence.[12]

Conclusions This case brought some much needed clarity with respect to the “inevitable accident” principle in negligence claims. Despite conflicting case law, an inevitable accident does not reverse the burden of disproving negligence to the defendant; the law of regular negligence applies and the burden remains with the plaintiff to show that the defendant failed to exercise reasonable care.

This decision also highlights the utility of summary judgment motions, particularly when matters in dispute are of a legal and not factual nature.

For more information regarding litigation, please contact one of our litigation lawyers or call us at 416-449-1400 for your available options or to book a consultation.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

This blog was co-authored by Gabriella Schneider and Articling Student, Leslie Haddock.

[1] 2025 ONSC 594 [Zapata].

[2] Ibid at paras 44-47.

[3] Ibid at para 5.

[4] 1956 CanLII 16 (SCC).

[5] Zapata, supra at para 50.

[6] Ibid at para 51, citing Graham v. Hodgkinson, 1983 CanLII 1775 (ON CA) at p. 703.

[7] Ibid at para 60, citing Martin-Vandenhende v Myslik, 2012 ONCA 53 at paras 25-31.

[8] Ibid at para 62.

[9] Ibid at para 89.

[10] Ibid at para 102.

[11] Ibid at para 105.

[12] Ibid at para 107.

The post The Limits of the “Inevitable Accident” Argument: Case Comment on Zapata, et al. v. Reid, et al. first appeared on Devry Smith Frank LLP.

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Given the significant weight of buying and selling a home, there are myriad of requirements that parties to a residential real estate transaction must meet in order for the deal to be legally binding. One of the most notable and self-evident requirements is that agreements to buy and/or sell land must be in writing.

In Ontario, the cornerstone of any real estate transaction is the Agreement of Purchase and Sale (“APS”). The APS is a standard form issued by the Ontario Real Estate Association (“OREA”) that codifies in writing all conditions of a particular real estate transaction, such as the purchase price, the specifics of the land and its boundaries, and assurances that all portions of the property are in good working order.

But what happens if the buyer and seller only agree verbally, with absolutely nothing in writing?

The Statute of FraudsOntario’s Statute of Frauds, R.S.O. 1990, c. S.19 (the “Act”) is an adoption of a 17th-century English law by the same name. This Act, and those similar to it in Canadian and international jurisdictions, requires certain kinds of contracts to be in writing. The goal of the Act is to prevent fraud from arising out of contracts not in writing.

Section 4 of the Act provides as follows:

Writing required for certain contractsS. 4 No action shall be brought to charge any executor or administrator upon any special promise to answer damages out of the executor’s or administrator’s own estate, or to charge any person upon any special promise to answer for the debt, default or miscarriage of any other person, or to charge any person upon any contract or sale of lands, tenements or hereditaments, or any interest in or concerning them, unless the agreement upon which the action is brought, or some memorandum or note thereof is in writing and signed by the party to be charged therewith or some person thereunto lawfully authorized by the party.

In other words, s. 4 states that agreements to sell land, pieces of land, or interests in land are only enforceable if they are written and signed. This means that if one party breaches the agreement or otherwise does not follow through on it, the other party is without legal recourse.

Exceptions to the Act: Part PerformanceWhile the goal of the Act is to prevent fraud, the courts realized that the Act, particularly s.4, could be and, in fact, was being used as an instrument of fraud itself, as it enabled the party in breach to legally default on their contractual obligations and avoid punishment. So, the courts carved out an exception to the general rule that contracts to buy/sell land must be in writing: the doctrine of part performance.[1]

Part performance is an equitable doctrine that is somewhat self-explanatory. Essentially, where one party under an oral agreement partially perform their obligations pursuant to the oral agreement, the steps they took in such performance can assist that party in enforcing the contract, which would otherwise be unenforceable as it is not in writing. The key is that the party who took those steps under the contract did so to their detriment, such that they only acted in this way because they were relying on the other party to hold up their end of the deal. If the other party backs out of the agreement, the party who had performed under the agreement will have grounds to enforce it vis-à-vis the doctrine of part performance.

The recent appellate decision in 2730453 Ontario Inc. v. 2380673 Ontario Inc., 2025 ONCA 112, offers an excellent illustration of how the doctrine of part performance works to enforce an oral agreement to sell land. Below is an analysis of this case.

Case Analysis: 2730453 Ontario Inc. v. 2380673 Ontario Inc., 2025 ONCA 112In this case, 2730453 Ontario Inc. was the buyer (the “Respondent”) and 2380673 Ontario Inc. was the seller (the “Appellant”). In September 2019, the parties orally agreed that the Appellant would sell a 32-acre lot to the Respondent for $4.1 million cash and that, if the deal closed on or before January 8, 2020, the Respondent would have to pay commission of $200,000 to the brokers (the “Agreement”).[2] The parties did not sign an APS or any other written contract at the time the Agreement was made because it was the Appellant’s preference that this be done at the time of closing.[3]

After the Agreement was made, both parties retained counsel and left it to them to finalize and close the deal. Counsel continued to exchange draft documentation and work out the final details throughout the fall of 2019.[4] On January 3, 2020, the Respondent’s lawyer sent the Appellant’s lawyer the signed sale agreement and requested that the Appellant sign the written agreement and deliver all other necessary documents by January 8, 2020. The Appellant’s lawyer did not respond. The closing date arrived, and the Appellant refused to close.[5]

The Respondent then sued the Appellant for refusing to close the deal. At trial, the Appellant argued that the Act is “a complete bar to recognizing this purported sale.”[6] The trial judge disagreed and found that the doctrine of part performance applied; therefore, the Agreement is enforceable.[7] The trial judge ordered that the sale proceed in accordance with the terms previously agreed to by the parties.[8]

The Appellant then appealed to the ONCA and lost again. In unanimously dismissing the Appellant’s appeal, the ONCA explained that to successfully demonstrate part performance of an oral agreement, the party seeking its enforcement must meet the following two requirements:

Evidentiary aspect – the party seeking enforcement engaged in conduct that is “integrally connected to what is required to close the transaction”[9]; and
Detrimental reliance – in engaging in the above conduct, that party acted to its detriment by performing its obligations under the unenforceable contract.

The coincidence of these two aspects creates part performance. Where one party partly performed under an oral agreement to sell land, it would be inequitable for the other party to rely on s. 4 of the Act to escape performing its own obligations pursuant to that oral agreement. This is why part performance is an exception to the general rule against enforcing oral agreements to sell land.

In this case, the ONCA agreed with the trial judge that the Respondent had partly performed under the Agreement. Specifically, the trial judge found that, among other things, the following actions were “unequivocally referable to the land in dispute” (i.e., integrally connected to the transaction):

Obtaining an environmental assessment of the property;
Conducting due diligence related to the property;
Retaining legal counsel to close the Agreement;
Delivering the documents required on closing; and
Obtaining, delivering, and tendering the certified cheque for the $4.1 million purchase price.[10]

Further, the Respondent detrimentally relied on the Appellant in carrying out these acts. The Respondent was doing what it ought to have done according to the Agreement, and would not have done so but for the existence of the Agreement. The Respondent, while performing its obligations under the Agreement, was relying on the Appellant to do the same.[11] The Appellant did not follow through under the Agreement, and the Agreement failed. This was inequitable toward the Respondent and, therefore, the ONCA concluded that this case was in line with the exception to the general rule against enforcing oral agreements to sell land. The Agreement was thus upheld and enforced.

ConclusionIn general, oral agreements to sell land are not enforceable. If you orally agree to sell your home to someone, it is generally not going to be upheld by the courts in Ontario. However, if one or both parties to an oral agreement partly perform under that agreement to the extent that one party detrimentally relied on the other party to do the same, then the Ontario courts may enforce the contract as an exception to the general rule.

It is always best to have an agreement clearly written out and signed, to guarantee that it is enforceable. If you need assistance with drafting, understanding, or executing a contract, reach out to litigation lawyer Graeme Oddy by calling 416-446-5810 or by emailing graeme.oddy@devrylaw.ca.

This article was co-authored by Articling Student, Rachel Weitz.

If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.

[1] 2730453 Ontario Inc. v. 2380673 Ontario Inc., 2025 ONCA 112 at para 2 [Appeal].

[2] Ibid at para 11.

[3] Ibid at para 12.

[4] Ibid at paras 13-7.

[5] Ibid at paras 18-21.

[6] 2730453 Ont. Inc. v. 2380673 Ont. Inc., 2022 ONSC 6660 at para 48 [Trial].

[7] Ibid at paras 122-4.

[8] Ibid at para 153.

[9] Appeal, supra note 1 at para 36.

[10] Ibid at para 24.

[11] Ibid at paras 49-52.

The post I Verbally Agreed to Sell My House – Can the Buyer Enforce the Deal Without a Written Contract? first appeared on Devry Smith Frank LLP.

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Cryptocurrency (or crypto) has become increasingly popular in recent years, with more Canadians investing in digital currencies like Bitcoin, Ethereum, and others. Nevertheless, with this popularity comes a range of complex legal and tax-related questions. One of the most common questions that crypto investors and traders in Canada face is whether the profits from their crypto transactions should be reported as capital gains or business income.

How Does the Canada Revenue Agency Define Cryptocurrency? First and foremost, in any legal or tax-related question, it is advisable to search and understand the definition of the term as defined by the appropriate authority. This way, when reading an income tax folio or an interpretation bulletin from the Canada Revenue Agency (“CRA”), all specific terms are defined and locating the appropriate rules and explanations is more accurately achieved.

Notably, however, for the term “cryptocurrency”, the CRA merely provided reference information for the public to simply understand the term, rather than assigning a specific definition to be strictly followed. Also importantly, crypto-assets such as cryptocurrencies are not necessarily securities for income tax purposes. What this means is that there is much open to interpretation, and an accounting or legal expert may be best suited to interpret a client’s tax filing needs and concerns.

The CRA understands cryptocurrencies to be “crypto-assets that are designed to function as a medium of exchange. They can be used to buy products or services, traded for other currencies, or acquired for speculative purposes. Unlike traditional currencies, cryptocurrencies are not controlled by centralized entities such as central banks.”

Crypto-asset “can generally be described as a digital representation of value that relies on a cryptographically secured distributed ledger, or a similar technology, to validate and secure transactions. Common examples of crypto-assets include, but are not limited to:

cryptocurrencies (payment/exchange tokens);
utility tokens;
security tokens; and
non-fungible tokens (NFTs).”

Understanding Capital Gains vs. Business Income Before diving into the specifics of cryptocurrency transactions, it is important to understand the basic difference between capital gains and business income.

Capital Gains: These are profits you earn when you sell an asset, such as property or stocks, for more than what you paid for it. In Canada, you only pay tax on 50% of your capital gains. This is typically applicable to investments you buy and hold with the intention of selling them for profit later.
Business Income: This refers to profits earned from an active business activity. In the context of crypto, if you are regularly buying and selling cryptocurrency as part of a business operation, then the profits from these activities are considered business income, and you may be taxed differently than on capital gains.

So, What Is the Difference in the Context of Crypto in Canada? For crypto in Canada, the difference between capital gains and business income often comes down to your intention and your course of conduct, such as how frequently you are buying and selling cryptocurrencies.

Capital Gains: If you buy cryptocurrency as an investment and hold onto it for a long time before selling, you are likely dealing with capital gains. This situation is similar to someone buying stocks or real estate with the goal of holding onto it for future appreciation. The CRA tends to view this as an investment activity, and any profits from these sales would likely be considered capital gains.
Business Income: If you are frequently buying and selling cryptocurrencies, or if you are using crypto for more active purposes (like mining or trading as part of your business), then the CRA might consider this to be business activity. In this case, any profits would be considered business income, and you would be subject to regular income tax rates, which could be higher than capital gains tax rates (i.e. 100% of business income is taxable).

How Does the CRA Decide? The CRA does not have a one-size-fits-all answer, and determining whether your crypto activity falls under capital gains or business income depends on the facts and circumstances of your case. The CRA looks at factors such as:

Frequency of Transactions: If you are buying and selling crypto often, it is more likely to be considered business income. For example, if you are trading crypto daily or weekly, the CRA may view this as a business activity.
Intention and Period of Ownership: Did you buy the cryptocurrency with the intent to hold it as an investment, or were you planning to sell it quickly for a profit? If your primary goal is long-term investment, it may lean toward capital gains. But if you are buying and selling for quick profits, it may be considered business income.
Expertise and time spent: If you have specialized knowledge or skills related to cryptocurrency, such as being a professional crypto trader and/or much of your time is spent studying the market and investigating potential purchases, it could be more likely considered business income.
Regularity and Organization: If you are carrying out your crypto transactions in a structured and organized way, similar to how a business operates, this could also indicate that your activity is more business-oriented.
Advertising: If you advertised or otherwise made it known that you are willing to purchase cryptocurrencies, then your course of conduct could be considered business income as well.

The above list is not exhaustive, and the CRA could factor in other things as well, such as financing for the crypto transaction(s) and more.

What Should You Do? As a crypto investor in Canada, it is crucial to properly report your crypto activities on your taxes. The CRA expects you to keep records of all transactions, including dates, amounts, and the value of crypto in Canadian dollars at the time of the transaction.

If You Are a Casual Investor: If you are buying and holding crypto as a long-term investment, it is likely you will report your profits as capital gains. Remember, you only pay tax on 50% of the capital gains, which can be a more tax-friendly approach than reporting business income.

If You Are an Active Trader or Miner: If you are actively trading or mining crypto, then it is more likely that you will need to report your earnings as business income. This means you will be subject to regular income tax rates.

Consult a Tax Professional: Since the CRA looks at each situation individually, it is always a good idea to consult a tax professional who can help you determine whether your crypto transactions should be classified as capital gains or business income.

Conclusion The key takeaway here is that whether your crypto profits are considered capital gains or business income depends largely on how you engage with crypto. If you are holding your cryptocurrency as an investment for the long term, capital gains likely apply. If you are buying and selling frequently or treating your crypto activity as a business, then business income may be the appropriate classification.

Remember, the CRA has specific guidelines for different types of transactions, so make sure you report your earnings correctly to avoid any issues down the line. Again, with cryptocurrencies, the CRA guidelines are not as clear-cut, and every person’s dealing with cryptocurrencies may vary.

If you are unsure about how to handle your taxes, it is always best to consult with a tax expert familiar with cryptocurrency laws. Call our tax lawyer, Graeme Odd,y at 416-446-5810 or email at graeme.oddy@devrylaw.ca.

This article was co-authored by Articling Student, Sanaz Sakhapour.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.

The post Crypto Transactions: Capital Gains or Business Income? What You Need to Know first appeared on Devry Smith Frank LLP.

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Meeting the eligibility requirements for Canadian citizenship is a major milestone on your immigration journey. One of the most important criteria in this process is meeting the residency (physical presence) requirement. Understanding exactly how this works can help you plan ahead and avoid delays in your application.

In this blog, we will walk you through the details of the residency requirement and how to calculate your days, so you know exactly when you are eligible to apply for a Canadian Citizenship Grant.

What Is the Physical Presence Requirement? To be eligible for Canadian citizenship, a permanent resident must have been physically present in Canada for at least 1,095 days (3 full years) out of the 5 years immediately before applying.

This does not mean three calendar years. The time is counted in actual days spent inside Canada, and only within the five-year window prior to the application date.

How to Calculate Your Days in Canada Here is how the days are counted:

Time After Becoming a Permanent Resident: * Each day you spend physically in Canada as a permanent resident counts as one full day. * When calculating an absence, the day you leave Canada and the day you return is not considered an absence. Both are counted as days of physical presence because you were physically in Canada for a part of the day of departure or arrival. + For example, if you leave Canada on May 1, 2025, and return on May 2, 2025, this counts as 0 days of absence. + As another example, if you leave Canada on May 1, 2025, and return on May 15, 2025, that only counts as 13 days of absence. * An absence on February 29 (leap day) is counted as an absence or is credited as a presence. * You cannot count any day more than once, and you must be physically present in Canada (not just holding status).

Time Before Becoming a Permanent Resident: * Days spent in Canada as a temporary resident (visitor, student, worker, or protected person) before becoming a permanent resident can count as half-days, up to a maximum of 365 days. + For example, if you were in Canada for 400 days before becoming a Permanent Resident, only 200 of those days count toward the 1,095-day requirement.

Days That Do Not Count: * Time spent outside Canada (vacation, work travel, etc.); * Time in Canada before the five-year window; * Days spent in prison, on parole, or probation (in some cases); and * Days as an unauthorized resident (overstaying a visa, etc.).

If you are in the Canadian Armed Forces: Those who are in the Canadian Armed Forces (“CAF”) or who are foreign military members on exchange with the CAF can apply for citizenship by way of the fast-track process.

To be eligible, members must:

meet all of the standard conditions to apply for citizenship (except for the residency requirement);
have completed three years (1,095 days) of service in or with the CAF in the six years (2,190 days) right before the date of their application; and
have met their personal income tax filing obligations in three taxation years that are fully or partially within the six years right before the date of application.

Tips for Meeting the Residency Requirement * Use the Physical Presence Calculator: The Government of Canada offers an official tool to help you track your eligible days. You can find it here. * Keep Records: Maintain a record of all travel outside of Canada, including dates, destinations, and reasons for travel. You will need to report these absences in your application. * Be Accurate: Misreporting or overestimating your time in Canada can lead to a refusal or delays. Always be honest and precise.

Other Key Citizenship Eligibility Criteria Alongside the residency requirement, you must also meet the following:

Permanent Resident Status: You must hold valid PR status and not be under review for immigration violations or facing a removal order.
Income Tax Filing: You must have filed taxes in Canada for at least three years within the five-year period.
Language Proficiency: If you are between 18 and 54 years old, you need to demonstrate proficiency in English or French.
- Specifically, this requires that you show proof of Canadian Language Benchmarks (“CLB”) of Level 4 or higher in English or French. To get this proof, you would need to schedule and pay for a test administered by a third-party agency that is approved by the Immigration, Refugees and Citizenship Canada (“IRCC”). See here for third-party language tests approved by the IRCC.
- You can also submit proof of your language proficiency of CLB Level 4 or higher.
  - For instance, if you completed a secondary or post-secondary program in English or French—whether in Canada or abroad—you can use your diploma, transcript, or certificate as proof.
Knowledge of Canada: You will need to pass a citizenship test about Canada’s history, values, laws, and institutions.

Circumstances That May Prevent You from Becoming a Canadian Citizen There are specific legal and criminal circumstances under the Citizenship Act that can prevent you from being granted Canadian citizenship. The following are some examples.

You are currently in Canada and:
- serving a prison sentence,
- on parole, or
- on probation.
You are serving a sentence outside of Canada.
You are currently:
- charged with,
- on trial for, or
- appealing a conviction related to an offence under the Citizenship Act, or for an indictable offence in Canada or an equivalent offence committed outside of Canada.
You are subject to a removal order, meaning Canadian authorities have instructed you to leave the country.
You are under investigation for, charged with, on trial for, appealing, or have been convicted of:
- a war crime, or
- a crime against humanity.
Your previous citizenship application was denied due to misrepresentation within the last five years.
Your Canadian citizenship was revoked for fraud within the past 10 years.
You were convicted of:
- an indictable offence in Canada, or
- a Citizenship Act offence, and
  - your application was submitted after June 11, 2015, and
  - the conviction occurred within four years before applying.
You were convicted, within the last four years before applying, of a crime outside of Canada that would be considered an indictable offence in Canada. This applies even if you received a pardon or amnesty, regardless of when your application is submitted.
While a permanent resident, you:
- were convicted of terrorism, high treason, treason, or espionage, or
- served in the armed forces of a country, territory, or group that engaged in armed conflict against Canada.

If you are uncertain whether these conditions apply to you, it is best to consult a lawyer or the relevant police authority.

If any of these situations apply:

Delay your application until the issue no longer applies.
- Note: If your citizenship was revoked for fraud within the past 10 years, you are permanently barred from regaining it.
Disclose the situation in your application.
Each application is reviewed individually, based on its unique circumstances.

Final Thoughts Meeting the residency requirement is one of the most critical parts of your citizenship application but it is also one of the most straightforward if you track your time carefully. Plan ahead, use the available tools, and keep good records of your travel and immigration history.

Once you have reached the 1,095-day threshold and meet all other criteria, you are well on your way to becoming a Canadian citizen.

Looking for an Immigration Lawyer? Immigration lawyer Benjamin Grubner specializes in Canadian and U.S. immigration matters. His dual jurisdiction insight allows him to offer clients holistic solutions that consider the legal processes of both locations. Benjamin can be reached at 416-446-3328 or by email at benjamin.grubner@devrylaw.ca.

This article was co-authored by Articling Student, Sanaz Sakhapour.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.

The post Meeting the Residency Requirement for Canadian Citizenship: What Permanent Residents Need to Know first appeared on Devry Smith Frank LLP.

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The processing of an application for Permanent Residence (PR) in Canada can often take several months, sometimes even longer. If you are currently working in Canada and your work permit is about to expire, you might be wondering: Can I extend my work permit while I wait for PR? The answer is yes, and in many cases, you may be eligible for a Bridging Open Work Permit (BOWP).

Here is what you need to know to stay legally employed and maintain your status in Canada while your permanent residence application is in progress.

What Is a Bridging Open Work Permit (BOWP)? A Bridging Open Work Permit allows you to continue working in Canada while your permanent residence application is being processed. Unlike employer-specific permits, a BOWP lets you work for almost any employer in Canada, giving you flexibility and peace of mind.

Who Is Eligible for a BOWP? You may be eligible for a BOWP if:

You are currently in Canada;
You have valid temporary resident status as a worker OR you have an expired work permit but maintained your status as a worker; and
You have submitted a complete permanent residence application, and you have received an Acknowledgement of Receipt (AOR) confirming your PR application is in process under one of the following streams:
- Federal Skilled Worker Program (FSWP);
- Canadian Experience Class (CEC);
- Federal Skilled Trades Program (FSTP);
- Provincial Nominee Program (Express Entry streams only);
- Agri-Food Pilot; or
- Quebec Skilled Worker Program (in limited cases).

Can I Keep Working While I Wait? Yes, if you apply for a new work permit before your current work permit expires, you may be eligible to continue working with “maintained status” (previously called implied status). This means you can legally continue working in Canada under the same conditions as your previous work permit until a decision on your new application is made.

What If I am Not Eligible for a BOWP? If you do not meet the requirements for a BOWP, for example, if you have not received an AOR yet or applied under a non-Express Entry program, you may still have options to remain or work in Canada, such as:

Extending your current work permit through an LMIA or employer-supported route.
Switching to a visitor record if you want to remain in Canada without working.
Apply for a study permit if you are planning to pursue further education.

Each option comes with its own eligibility requirements, so it is important to plan ahead and seek advice if needed.

Final Thoughts The Bridging Open Work Permit (BOWP) is a valuable option for maintaining your ability to work in Canada while awaiting a decision on your permanent residence application. It can help support your financial stability while allowing you to stay connected to your community and career during this important transitional period.

If you are unsure about your eligibility or how to maintain your legal status, it is always a good idea to consult with a licensed immigration consultant or lawyer.

This article was co-authored by Articling Student, Sanaz Sakhapour.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.

The post How to Extend Your Work Permit While Waiting for Permanent Residence in Canada first appeared on Devry Smith Frank LLP.

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Canada’s tech industry is booming, but one of the biggest challenges for companies is attracting and retaining top-skilled talent. With global competition for skilled workers intensifying, Canadian tech firms must leverage various immigration pathways to ensure they have the workforce needed to drive innovation and growth. Here are the key immigration programs available to help tech companies secure the best global talent.

1. Global Talent Stream The Global Talent Stream (GTS) is a fast-track work permit program designed to help Canadian employers bring in highly skilled foreign workers in as little as two weeks. The GTS is ideal for tech companies looking to hire talent in specialized fields such as artificial intelligence, software development, and cybersecurity.

There are two categories of the GTS:

Category A: Tech companies in this category must be referred to Service Canada by a designated referral partner and must hire unique and specialized temporary foreign workers to help their business grow.
Category B: Tech companies may be eligible under this category if they are looking to hire highly skilled temporary foreign workers to fill positions for in-demand occupations included on the global talent occupations list. This is the more common pathway, and a referral is not required.

In-demand occupations under Category B include:

computer and information systems managers;
civil engineers;
electrical and electronics engineers;
mining engineers;
aerospace engineers;
computer engineers (except software engineers and designers);
mathematicians and statisticians;
information system analysts and consultants;
database analysists and data administrators;
software engineers and designers;
computer programmers and interactive media developers;
web designers and developers;
electrical and electronics engineering technologists and technicians;
computer network technicians;
information systems testing technicians;
producer, technical, creative, and artistic directors and project managers for visual effects and video games; and
digital media designers.

Tech companies seeking foreign workers under the GTS pathway may also require a Labour Market Benefits Plan (LMBP) to identify and track your job creation, skills and training investments, and other activities that will benefit the Canadian economy and labour market. Employee wages must be, at minimum, the median wage published by Employment and Social Development Canada on the Job Bank site for the NOC code of the position and location of work.

Key Benefits:* Processing time as fast as two weeks. * Access to top talent in fields with skill shortages in Canada. * Avoid minimum recruitment requirements typically involved in the LMIA process.

2. Express Entry SystemThe Express Entry system is a points-based immigration program that allows skilled foreign workers to apply for permanent residence. It is a great option for companies looking to hire long-term employees who are eager to settle in Canada.

Key Benefits:* Permanent residency for skilled workers under the Federal Skilled Worker Program and Canadian Experience Class. * Candidates can receive job offers through the Labour Market Impact Assessment (LMIA) * Tech employers can benefit from provincial nominations to increase a candidate’s chances of selection.

3. Provincial Nominee Programs (PNPs) – Tech StreamsMany provinces have specialized immigration streams tailored to the tech sector under their Provincial Nominee Programs (PNPs). These programs help skilled workers settle in specific provinces where tech demand is high.

For example, Ontario has the “Tech Draws” under the Ontario Immigrant Nominee Program. Tech Draws are new opportunities under the Human Capital Priorities Stream, which are intended to identify people with in-demand technological skills and experience in the Express Entry pool. Candidates cannot actively apply to this program and must wait to receive an invitation. Candidates only need an eligible Express Entry profile, not a job offer.

Other provinces also have technology-focused PNPs, such as the British Columbia PNP Technology, the Quebec Pilot Program for Workers in the Artificial Intelligence, Information Technologies and Visual Effect Sectors, and the Saskatchewan Tech Talent Pathway.

4. Startup Visa ProgramFor tech companies looking to bring in entrepreneurial talent, the Startup Visa Program is an excellent option. This program allows innovative entrepreneurs with scalable business ideas to move to Canada and gain permanent residency.

Key Benefits:* Entrepreneurs and their families may obtain direct permanent residency. * Access to venture capital, angel investors, and business incubators in Canada. * Supports the growth of innovative tech startups in Canada.

5. Intra-Company Transfers (ICTs)For multinational tech companies with operations in Canada, the through IRCC’s International Mobility Program allows companies to relocate key employees from international offices to their Canadian branches without needing an LMIA. See our previous blog for a more detailed overview of the ICT Program and the recent changes to the program.

Key Benefits:* No LMIA is required. * Work permits can be issued within a few weeks. * Allows senior executives, specialists, and managers to work in Canada and transition to permanent residency.

6. Post-Graduation Work Permit (PGWP) & Employer-Sponsored Permanent Residency Although we have seen some significant changes to the Post Graduate Work Permit (PGWP) in recent months, Canadian tech companies can still tap into the vast pool of international students graduating from Canadian universities and colleges by offering them jobs and helping them transition to permanent residency.

The PGWP allows students who have graduated from eligible post-secondary programs to gain work experience in Canada without employer sponsorship for up to three years.
Employers may also hire international students to support their transition to permanent residency via the Express Entry system or PNPs.

These processes allow graduates who are already familiar with Canadian work culture to easily integrate into the workforce.

Final ThoughtsTo remain competitive in the global market, Canadian tech companies must leverage these immigration pathways to attract and retain top talent. By using programs like the Global Talent Stream, Express Entry, and Provincial Nominee Programs, companies can ensure they have the highly skilled workforce needed to thrive in an increasingly digital world.

If your company is looking to hire international talent, consulting with immigration professionals and staying informed about evolving immigration policies can help streamline the process and maximize success.

To learn more information and find out which of these pathways would work best for you, please contact experienced immigration lawyer, Benjamin Grubner, at benjamin.grubner@devrylaw.ca or 416-446-3328.

This blog was co-authored by Articling Student, Leslie Haddock.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

The post Pathways for Canadian Tech Companies to Attract and Retain Skilled Talent in Canada first appeared on Devry Smith Frank LLP.

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The immigration process can be overwhelming, particularly when it involves sponsoring a spouse. One of the most common routes for couples to reunite in Canada is through the Spousal Sponsorship Program, which allows Canadian citizens and permanent residents to sponsor their foreign spouses or common-law partners for permanent residency in Canada. This process can seem complicated, but with the right information, it becomes much more manageable.

In this blog post, we’ll break down the essentials of a spousal sponsorship application, focusing on two key terms you will encounter: Sponsor and Principal Applicant.

What is the Spousal Sponsorship Program? The spousal sponsorship program is part of Canada’s family reunification policy, designed to allow Canadian citizens and permanent residents to bring their spouses or common-law partners to live with them in Canada. This program allows your partner to become a permanent resident of Canada, granting them the same rights as any other resident, such as access to healthcare, the ability to work, and the opportunity to live in Canada indefinitely.

Who Can Be a Sponsor? A Sponsor is the Canadian citizen or permanent resident who agrees to support their spouse or common-law partner during their immigration process. To be eligible to sponsor someone, you must meet several requirements:

Be a Canadian citizen or permanent resident: The sponsor must be living in Canada (unless they are a Canadian citizen living abroad, in which case there are still options to sponsor their spouse).
Be at least 18 years old: You need to be of legal age to sponsor someone.
Prove your financial stability: Though there are exceptions to this requirement, the sponsor must demonstrate that they have the financial means to support their spouse or partner. This is particularly important to ensure that the sponsored person does not rely on social assistance.
Not be in default of previous sponsorship agreements: If you have previously sponsored someone and did not meet the financial requirements or the sponsorship obligations, you may not be eligible to sponsor again.
Agree to support the sponsored individual: The sponsor must sign an agreement committing to support the principal applicant financially for a specific period (usually 3 years) after the person arrives in Canada.

Who is the Principal Applicant? The Principal Applicant is the person being sponsored—typically the spouse or common-law partner of the sponsor. This person is the one applying for permanent residency in Canada. They will be the primary subject of the application, and their eligibility and background will be carefully examined by Canadian immigration officials.

The principal applicant needs to meet the following requirements:

Be the spouse or common-law partner: The relationship between the applicant and the sponsor must be genuine, and the couple must provide evidence to show that they are indeed in a committed, long-term relationship.
Complete medical and criminal background checks: The principal applicant must be medically and criminally admissible to Canada. This includes passing a medical examination to ensure they do not have any health conditions that could pose a risk to public health or place an undue burden on Canada’s healthcare system. A criminal background check is also required to confirm that the applicant does not have a criminal record.
Provide documentation to prove the relationship: As part of the application process, the principal applicant must provide evidence of their relationship with the sponsor. This can include photos, communication records, and affidavits from people who can attest to the relationship’s authenticity.

The Application Process The spousal sponsorship application process generally involves these key steps:

Gather Documents: Both the sponsor and the principal applicant need to gather the necessary documents to submit their application. These may include proof of identity, proof of relationship, medical records, and police certificates.
Submit the Application: After the documents are ready, the sponsor and the principal applicant will need to submit the application package to Immigration, Refugees, and Citizenship Canada (IRCC).
Processing Time: The processing time for a spousal sponsorship application can vary depending on several factors, including the country of origin of the principal applicant. Typically, it can take anywhere from 10 months to over 18 months.
Decision: After reviewing the application, IRCC will make a decision. If approved, the principal applicant will receive permanent resident status in Canada.

Financial Responsibility and Sponsorship Agreement One of the most important aspects of the spousal sponsorship process is the financial commitment from the sponsor. This is formalized through the sponsorship agreement, which the sponsor and the principal applicant must sign. This agreement outlines the sponsor’s responsibility to financially support the principal applicant for a period of three years after their arrival in Canada. If the sponsored individual requires social assistance during this time, the sponsor may be required to repay the amount to the Canadian government.

In Conclusion The spousal sponsorship process in Canada provides a path for couples to build a life together in the country. Understanding the roles of the sponsor and the principal applicant is crucial for navigating the application process successfully. The sponsor is the Canadian citizen or permanent resident who takes on the responsibility of financially supporting their spouse or partner, while the principal applicant is the individual being sponsored, seeking to gain permanent residency in Canada.

While the process can seem complicated, ensuring that you meet all the eligibility requirements and submitting a complete, well-documented application will increase your chances of success. If you’re unsure about any part of the application, it might be beneficial to seek the advice of an immigration lawyer to guide you through the process.

Need Help? Immigration lawyer Benjamin Grubner specializes in Canadian and U.S. immigration matters. His dual-jurisdiction insight allows him to offer clients holistic solutions that consider the legal processes of both locations. If you need help navigating the Spousal Sponsorship process for permanent residence in Canada, Benjamin can be reached at 416-446-3328 or email benjamin.grubner@devrylaw.ca.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please speak to a qualified professional. Each case is unique, and a lawyer with proper training and sound judgment can provide you with advice tailored to your specific situation and needs.

The post How to Sponsor Your Spouse for Canadian Permanent Residency first appeared on Devry Smith Frank LLP.

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Your Step-by-Step Guide to Successfully Handling a Procedural Fairness Letter from Immigration Canada When applying for a work permit, study permit, or any other immigration application through Immigration, Refugees and Citizenship Canada (“IRCC”), receiving a Procedural Fairness Letter (“PFL”) can be an unsettling experience. However, understanding what this letter means and how to properly address it can make a significant difference in the outcome of your application.

What is a Procedural Fairness Letter? A PFL is a formal communication sent by IRCC to applicants when they believe there may be concerns or issues with their application that need to be addressed before a final decision is made. Essentially, it provides applicants with an opportunity to respond to any potential issues or negative findings related to their application.

These letters are issued when the IRCC believes that, based on the information provided or the way the application has been processed, there are factors that could affect the decision-making process, such as:

Incomplete or misleading information
Inconsistencies or discrepancies in the application
Failure to meet eligibility requirements
Potential concerns about the applicant’s credibility
A perceived failure to meet legal or procedural criteria

The purpose of the PFL is to allow applicants to correct any errors, provide clarification, or offer new evidence that could change the outcome of their application. Effectively, the IRCC is offering the applicant a chance to explain or rectify the situation before making a final decision.

Why Did I Receive a Procedural Fairness Letter? Receiving a PFL does not necessarily mean your application will be denied or that there is a major problem. It is simply an opportunity to clear up any uncertainties that the IRCC officer has encountered during the review process.

Common reasons applicants might receive a PFL include:

Inconsistent or Missing Information: If some parts of your application do not align with your previous applications, documents, or statements, IRCC may request clarification.
Misrepresentation or Incomplete Documents: If IRCC believes that some aspects of your application are misleading or missing key documents, they may ask for an explanation.
Admissibility Issues: Sometimes, questions arise about your eligibility to enter or remain in Canada, such as concerns about criminality or health.
Questions About Your Intentions: IRCC may have doubts about your intent to comply with the terms of the visa or permit you are applying for, such as a visitor visa or work permit.
Failure to Demonstrate Sufficient Ties to Your Home Country: This is common with temporary resident visas, where the applicant must prove they have strong ties to their home country to ensure they will return after their visit to Canada.
1. 1.

How to Address a Procedural Fairness Letter Addressing a PFL can be daunting, but if you approach it carefully and systematically, you can maximize your chances of a successful outcome. Here is a step-by-step guide on how to handle it:

Read the Letter Carefully

First, read the letter thoroughly. The PFL will typically explain the concerns the IRCC officer has raised, and it will outline how you can respond. Pay attention to any deadlines – often, applicants have 30 days to respond to a PFL, so it is important to act quickly.

Understand the Specific Issue

Next, pinpoint the issue that IRCC has raised. Are they questioning your previous travel history? Do they doubt your financial stability or the legitimacy of your job offer? Understanding the specific concern will allow you to focus your response on addressing it effectively.

Gather Supporting Evidence

If the letter asks for clarification, additional documentation, or corrections, gather the necessary evidence to support your case. This could include:

Updated documents (e.g., financial statements, job offers, invitations)
Explanations for any inconsistencies (e.g., a detailed statement explaining why a particular fact was overlooked)
Proof of ties to your home country (e.g., family, property ownership, employment)

Make sure all the documents you submit are clear, accurate, and relevant.

Provide a Clear and Concise Response

Write a formal response addressing the specific concerns raised by IRCC. Be professional and straightforward in your explanation, and avoid providing irrelevant information. If your application has mistakes or omissions, acknowledge them and explain why they occurred. If applicable, include how you rectified the situation.

Seek Professional Advice (If Necessary)

If you are unsure about how to address the concerns raised or how to structure your response, consider seeking advice from a licensed immigration consultant or lawyer. They can help you formulate an effective response and ensure that all necessary documentation is included.

Submit Your Response on Time

Ensure that you submit your response and any supporting documentation within the timeline specified in the letter. Missing the deadline could result in your application being denied or further delayed.

What Happens After You Respond? Once you submit your response to the PFL, IRCC will review the information you provided and decide whether to approve or refuse your application. They may either:

Approve your application if your response satisfactorily addresses their concerns.
Request further clarification or documentation.
Deny your application if they still have unresolved concerns or if you failed to address the issues raised.

Key Takeaways Receiving a Procedural Fairness Letter from IRCC can be a stressful situation, but it is also an opportunity to clarify any issues and strengthen your application. Here is a summary of how to handle a PFL:

Read the letter carefully, identify important deadlines and issues.
Gather supporting evidence to address the concerns.
Respond clearly, concisely, and professionally.
Submit your response within the specified time frame.
Consider seeking professional help if needed.

By responding thoroughly and promptly, you will give yourself the best chance of a positive outcome. While it may seem like a setback, a Procedural Fairness Letter is simply a step in the process, and with careful attention, you can turn it into a chance to strengthen your case.

This article was co-authored by Articling Student, Sanaz Sakhapour.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.

The post How Do I Respond to a Procedural Fairness Letter from IRCC? first appeared on Devry Smith Frank LLP.

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As Canadians increasingly flock to the United States (“U.S.”) for extended stays—whether for vacations, work, or retirement—new regulations have been introduced that could significantly impact snowbirds, travelers, and businesspeople alike. Specifically, the U.S. has implemented new alien registration requirements for foreign nationals, including Canadians, who plan to stay in the U.S. for more than 30 days. This move comes as part of the country’s newly issued Protecting the American People Against Invasion executive order as part of ongoing efforts to streamline border security and enhance the management of foreign nationals and long-term visitors.

If you are a Canadian planning a visit to the U.S., particularly for an extended stay, here is everything you need to know about the new U.S. registration process.

Why the Change?Historically, Canadians traveling to the U.S. for fewer than 180 days were not required to undergo the same visa application process as travelers from other countries. They could simply show up at the border, and with a few exceptions, be granted entry for a period of up to six months.

Recent changes to U.S. immigration policy have shifted the status quo, particularly for Canadians who plan to stay for more than 30 days. This shift is part of the U.S. government’s broader initiative to improve border security, track visitors more effectively, and ensure that visitors comply with their allowed stay periods.

What Does the New Registration Process Involve?Canadians and other foreign nationals who are not already registered and who wish to stay in the U.S. for more than 30 days must create a U.S. Citizenship and Immigration Services (“USCIS”) online account and complete and submit the electronic Form G-325R. This form must be filed online—it cannot be filed by mail or in person.

Once the above form is filed, USCIS will determine whether a biometric services appointment is required to collect fingerprints. If the registrant requires biometric collection, USCIS will schedule an appointment at a U.S. Application Support Center (“ASCs”). Biometric collection is not required for Canadian visitors and foreign nationals under 14 years of age.

Once registered and all biometrics are provided (if necessary), USCIS will post a notice in the registrant’s online account where they can print a PDF version for their records.

There is no filing fee for Form G-325R, nor is there a fee associated with the biometric services.

Who Must Register?The following people must create an online USCIS account and register using Form G-325R:

All aliens 14 years of age or older who were not registered and fingerprinted (if required) when applying for a visa to enter the United States and who remain in the United States for 30 days or longer. They must apply before the expiration of those 30 days;
The parents or legal guardians of aliens less than 14 years of age: Parents or legal guardians must apply for the registration of aliens less than 14 years of age who have not been registered and remain in the United States for 30 days or longer, before the expiration of those 30 days;
Any alien, whether previously registered or not, who turns 14 years old in the United States, within 30 days after their 14th birthday;
Aliens present in the United States without inspection and admission or inspection and parole who have not otherwise registered (that is, aliens who crossed the border illegally);
Canadian visitors who entered the United States at land ports of entry and were not issued evidence of registration; and
Aliens who submitted one or more benefit requests to [the U.S. Citizenship and Immigration Services] not listed in 8 CFR 264.1(a), including applications for deferred action or Temporary Protected Status who were not issued evidence of registration listed in 8 CFR 264.1(b).

Who Does Not Need to Register? Lawful permanent residents of the USA; * Aliens paroled into the United States under INA 212(d)(5), even if the period of parole has expired; * Aliens admitted to the United States as nonimmigrants who were issued Form I-94 or I-94W (paper or electronic), even if the period of admission has expired; * All aliens present in the United States who were issued immigrant or nonimmigrant visas before their last date of arrival; * Aliens whom [the Department of Homeland Security] has placed into removal proceedings; * Aliens issued an employment authorization document; * Aliens who have applied for lawful permanent residence using Forms I-485, I-687, I-691, I-698, I-700, and provided fingerprints (unless waived), even if the applications were denied; and * Aliens issued Border Crossing Cards.*

Who Should Be Particularly Cautious?The new registration rules affect any Canadian who plans to stay in the U.S. for more than 30 days and who is not already registered in the USCIS system. The following key groups should be especially mindful of the new laws:

Snowbirds: Canadians who head south to warmer climates during the winter months are a primary focus of this new regulation. If you plan to spend more than a month in places like Florida, Arizona, or California, you will need to follow the registration process.
Retirees: Many Canadians retire in the U.S., often spending several months at a time. If you fall into this category and intend to stay beyond 30 days, registering beforehand is a requirement.
Business Travelers: Canadians travelling for work, attending conferences, or managing business affairs in the U.S. for more than 30 days must also comply with these new rules.
Family Visitors: If you are visiting family in the U.S. for an extended period, make sure you are aware of these registration requirements to avoid any disruptions to your stay.

What Happens if You Do Not Register?Failure to comply with the new registration requirements could result in complications at the border, including denial of entry or being given a shorter stay period than originally planned. For snowbirds, this could mean holidays or vacations that are cut short, and it may even impact your ability to enter the U.S. in the future.

Additionally, an overstay without proper registration or not abiding by the terms of your visa could lead to severe penalties. This includes imprisonment, fines and potentially being barred from reentering the U.S. for a certain amount of time.

Tips for Smooth Registration and Travel Plan Ahead: Make sure to complete your registration well in advance of your planned departure date, and at minimum, within 30 days of your arrival to the U.S. Advanced planning can save you time and prevent unnecessary stress at the border. * Keep Documents Handy: Be sure to have your registration notice, travel itinerary, proof of accommodation, return flight, and any other required documentation on hand when you arrive at the border. * Consult a Legal Professional*: If you are unsure about your specific circumstances—whether due to previous visits, or if you plan to stay for an extended period—consider consulting with an immigration lawyer or travel expert to ensure you meet all the requirements.

Conclusion: A New Era for Canadian VisitorsThe new U.S. registration requirements for Canadians staying longer than 30 days mark a significant change in the way cross-border travel is managed. While this might seem like a hassle, the goal is to enhance security and streamline the experience for long-term visitors. By understanding the process and taking the necessary steps to register ahead of time, you can continue to enjoy your time in the U.S. without unexpected surprises or disruptions.

As always, stay informed about the latest immigration policies and be proactive in meeting the requirements to ensure smooth and hassle-free travel!

Bon Voyage!

This article was co-authored by Articling Student, Sanaz Sakhapour.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.

The post New U.S. Registration Requirements for Canadians, Including Snowbirds: What You Need to Know first appeared on Devry Smith Frank LLP.

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Proper estate planning requires effectively communicating the intentions of the deceased. In doing so, even simple words can create significant interpretation issues in the administration of an estate and lead to long and costly court battles. One very common issue faced in Estates Law is the definition of a “child” in a will or under the Succession Law Reform Act (SLRA).[1]

While general definitions are outlined in most will templates to provide guidance for executors and solicitors, a definition as simple as “child” or “issue” has caused significant confusion over the years.

Children Conceived and Born After Parent’s Death The SLRA was amended in 2017 to expand the definition of a child to include a child that was conceived and born after a parent’s death:

1(1) In this Act,

“child” includes,

(a) a child conceived before and born alive after the parent’s death, and

(b) a child conceived and born alive after the parent’s death, if the conditions in subsection 1.1 (1) are met;

Section 1.1(1) outlines the conditions that must be met for a child conceived and born alive after a person’s death to be considered a “child” under the Act:

1.1 (1) The following conditions respecting a child conceived and born alive after a person’s death apply for the purposes of this Act:

The person who, at the time of the death of the deceased person, was his or her spouse, must give written notice to the Estate Registrar for Ontario that the person may use reproductive material or an embryo to attempt to conceive, through assisted reproduction and with or without a surrogate, a child in relation to which the deceased person intended to be a parent.
The notice under paragraph 1 must be in the form provided by the Ministry of the Attorney General and given no later than six months after the deceased person’s death.
The posthumously-conceived child must be born no later than the third anniversary of the deceased person’s death, or such later time as may be specified by the Superior Court of Justice under subsection (3).
A court has made a declaration under section 12 of the Children’s Law Reform Act establishing the deceased person’s parentage of the posthumously-conceived child.

In essence:

The child’s parent must have been the married spouse of the deceased, as the SLRA does not recognize common law spouses;
The spouse must give notice of their intention to use the reproductive material of the deceased to the Estate Registrar for Ontario no later than six months after the deceased’s death;
The child must be born within three years of the deceased’s death, unless the court orders otherwise; and
The spouse must obtain a declaration from the court under Section 12 of the Children’s Law Reform Act (CLRA) that the deceased is a parent of the child.

Special RelationshipIn Ksianzyna Estate v. Pastuszok [2], Justice Brown was tasked with analyzing whether the court should expand the definition of “child” in subsection 1(1) of the SLRA to minors who enjoy a “special relationship” with a testator. While Part V of the SLRA, which governs dependant support claims, expands the definition of “child” to include those who the deceased “has demonstrated a settled intention to treat as a child of his or her family,”[3] this broader definition does not apply to the rest of the Act. Justice Brown declined to expand the general definition of “child” under the SLRA, as “the power to expand the scope of familial terms or social concepts beyond their plain and ordinary meaning is one that rests with the legislatures, not with the courts.”[4] As such, someone who enjoyed a “special relationship” with a testator or deceased will not be considered a “child” under the SLRA for testate or intestate succession but may be considered a child for the purposes of dependant support.

Foster Children The Ontario Superior Court of Justice recently re-examined the definition of a child under the SLRA in Estate of Sydney Monteith v Monteith et al.[5] In this case, the applicant was a foster child seeking to receive a share of her foster father’s estate under the rules of intestate succession after he died without a will. However, the court affirmed the decision in Ksianzyna and found that:

…the harsh, but inescapable, reality is that she does not qualify because she is a foster child who has never been adopted. This is a matter of statute, the plain language of which I find to be very clear, and which is binding and determinative. I am not disposed to ignore the statutory provisions discussed above in the guise of “doing justice”.[6]

Accordingly, like children who enjoy a “special relationship” with the testator, a foster child is not considered a “child” for the purposes of testate or intestate succession under the SLRA but may be able to make a dependant support claim if they fall within the expanded definition of “child” under Part V of the Act.

“Settled Intention” of the Deceased As noted above, while the definition of a child is strictly interpreted under subsection 1(1) of the SLRA, there is a broader definition of “child” under Part V of the Act which addresses the support of dependants. An application for support under Part V of the Act is distinct from a claim of inheritance under a Will or on intestacy. Under subsection 57(1) a “child” includes “a person whom the deceased has demonstrated a settled intention to treat as a child of his or her family.” In that same section, a “dependant” is defined as the spouse, parent, child, or sibling of the deceased “to whom the deceased was providing support or was under a legal obligation to provide support immediately before his or her death.”[7] As such, if the deceased was providing support to a person who was not their biological or adopted child, but to whom they had demonstrated an intention to treat as their child, then that person could make a dependant support claim against their estate.

The term “settled intention” has been the topic of much debate in the courts. In Pigott Estate v Pigott, the court held that at least one of the following factors must be present to establish a settled intention between the deceased and the applicant:

Cohabitation with the child;
Treatment of the child on equal footing with their own child(ren);
Decision-making power with respect to the child’s name, schooling, discipline, and so on;
Continued access or visitation with the child; or
Financial contributions to the daily needs of the child. [8]

While one of these factors must be present for the courts to find that the deceased had a “settled intention” to treat a person as their child, the existence of one of these factors will not be determinative in showing that a settled intention exists. For instance, in Stajduhar v Wolfe, Justice Dunphy concluded that the deceased had no settled intention to treat his girlfriend’s daughter as his child, even though he provided her with financial support while at university.[9] In reaching this conclusion, Justice Dunphy also considered that the deceased never introduced the applicant to any of his family, including his two children; never characterized applicant as his daughter to his friends or family; did not provide for the applicant in his will, even though he specifically provided for his own two children; and that none of the deceased’s writings indicated that he intended to treat the applicant as his child.[10]

Impact on Estate PlanningUnder the general definitions section of the SLRA, a “child” is limited to biological or adopted children of the deceased. Foster children, stepchildren, and others who the deceased intended to treat as their child do not fall within this definition; as such, they have limited recourse in the courts, unless they are applying for dependant support.

If you are planning your estate, it is important to be aware of these definitions and consider their implications. If your child is not your adopted or biological child but you still want them to benefit from your estate, then you must plan your estate accordingly, given that they will have no rights on if you pass away without a Will. Moreover, it is important to ensure that the definition of “child” in your Will is broad enough to include anyone that you consider to be your child, or that you specifically refer to your child by name in your bequests.

If you would like more information regarding estate planning, please contact experienced Wills and Estates Lawyer, Jillian Bowman, of Devry Smith Frank LLP at (249) 888-4639 or at jillian.bowman@devrylaw.ca

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.

This blog was co-authored by Summer Law Student, Jason Corry, and Articling Student, Leslie Haddock.

[1] RSO c S 26 [SLRA].

[2] 2008 CanLII 59321 (ON SC) [Ksianzyna].

[3] SLRA, supra note 1, s 57(1).

[4] Ksianzyna, supra note 3 at para 12.

[5] 2023 ONSC 7246 [Monteith].

[6] Ibid at para 24.

[7] SLRA, supra note 1, s 57(1).

[8] Pigott Estate v Pigott, 1998 CarswellOnt 2875 at para 14.

[9] Stajduhar v Wolfe, 2017 ONSC 4954 at para 154, aff’d Kerzner Estate, 2018 ONCA 258, refused leave to appeal to the Supreme Court of Canada [Stajduhar].

[10] Ibid at para 153.

The post What’s In a Name? The Evolution of a “Child” Under the Succession Law Reform Act first appeared on Devry Smith Frank LLP.

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In a recent Ontario Superior Court of Justice decision, Graham v. McNally Estate and Blais,[1] Justice Corthorn considers whether an evidentiary burden threshold has been met to successfully challenge the validity of an executed will.

FactsSheila Mary McNally (“Sheila”), passed away in October 2021. In her will, Sheila named her friend of 14 years, Katherine Blais (“Katherine”), the respondent in this action, as the primary estate trustee, attorney for property, attorney for personal care, and beneficiary along with Katherine’s spouse.

Patricia Graham (“Patricia”), sister of the late Sheila, and the applicant in this proceeding, challenged the validity of the will. To support her claim, Patricia relied on three main arguments; Sheila’s lack of testamentary capacity, the presence of undue influence, and suspicious circumstances surrounding the execution of the will.

In response, Katherine brought a motion for an order to dismiss the application claiming that Patricia had not met the evidentiary burden threshold that is required for the court to allow the proceeding to continue.

Lack of Testamentary Capacity In November 2020 Sheila decided to update her will that was previously prepared in 2001. Patricia alleged that Sheila’s updated will was invalid because she lacked testamentary capacity due to mental illness, difficulty calculating numbers, and confusion.[2]

The court found that the evidence Patricia relied upon is nothing more than mere speculation and is not substantiated by any objective evidence, such as medical records.[3] Therefore, the evidence did not meet the applicable threshold to support Patricia’s claim that Sheila lacked testamentary capacity when she executed her will.

Undue Influence and Suspicious Circumstances Patricia also claimed that Katherine unduly influenced Sheila and pointed to suspicious circumstances surrounding the will’s execution.

In order for a claim of undue influence to be successful, there must be coercion and the influence imposed on the testator must be “so overpowering that the document reflects the will of the influencer and not that of the deceased”.[4] The Superior Court of Justice concluded that Patricia was unsuccessful in meeting this threshold because she was unable to adduce and point to any evidence illustrating Katherine attempted to influence Sheila in any way with regard to the execution of her 2020 will.[5]

Patrica also asked the court to find the will invalid based on suspicious circumstances at the time of the execution of the will. However, Patricia was also unable to provide any evidence that would rebut the presumption that Sheila had knowledge of and approved the contents of the will. Sheila executed the will with legal assistance and there were no irregularities or any indication of suspicious circumstances surrounding the execution.[6]

Decision The court concluded that Patricia did not meet the minimal evidentiary threshold required to challenge the will. The court deemed suspicions alone are insufficient to invalidate the will, and her objections were based on speculation rather than substantive evidence.[7] Therefore the court decided to grant the motion and dismiss the application in its entirety.[8]

TakeawayJustice Corthorn’s decision and reasoning in Graham v. McNally Estate and Blais demonstrates the importance of providing a true evidentiary basis that is based on substantive, anecdotal proof, as opposed to mere speculation and opinion when attempting to contest the validity of a will.

If you have questions about challenging a will, please contact Esther Abecassis, wills and estates lawyer at Devry Smith Frank LLP at 416-446-3310 or esther.abecassis@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

This blog was co-written by summer law student Adriana Piccolo.

[1] 2024 ONSC 4006 (CanLII).

[2] Ibid at para 49.

[3] Ibid at para 58.

[4] Young v. Prychitko et al, 2022 ONSC 1502 (CanLII) at paras 20-21.

[5] Supra note 1 at para 75.

[6] Ibid at para 14.

[7] Ibid at para 32.

[8] Ibid at para 96.

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On May 6, 2024, the Ontario Government introduced Bill 190: Working for Workers Five Act, 2024.[1] The proposed Bill seeks to provide greater protection for employees by amending the Employment Standards Act, 2000 (ESA) and the Occupational Health and Safety Act (OHSA). Most notably, the proposed amendments seek to increase the fines that individuals might face if convicted of an offence under the ESA. This blog addresses the potential impact of the proposed legislative changes on employers.

The Current Statutory Scheme Under the OHSA OHSA establishes minimum health and safety standards and practices that all parties in the workplace must follow. The Minister of Labour is responsible for the administration of the Act and appointing inspectors who assess an employer’s compliance with the OHSA.[2] Pursuant to section 66 of OHSA, any person who contravenes or fails to comply with the Act “is guilty of an offence and on conviction is liable to a fine of not more than $500,000 or to imprisonment for a term of not more than twelve months, or to both.”[3] A corporation convicted of an offence is liable to a fine of up to $2 million.[4]

Under the ESAThe ESA governs the relationship between most employees and employers in Ontario. The ESA sets out minimum entitlements of employees. It is not permissible for an employee and employee to contract out of the ESA.

As with the OHSA, the Ministry of Labour is responsible for the administration of the Act. The Minister can appoint employment standards officers, who have broad powers to investigate possible contraventions of the Act and perform inspections to ensure that the Act is being complied with.[5] Following an investigation, employers may be convicted of contravening the ESA. thereby leaving them vulnerable to fines and even imprisonment.

Section 132 of the ESA imposes penalties on any person, including a corporation or a trade union, who violates a provision of the Act, such as failing to provide overtime pay or refusing to reinstate an employee after a protected leave. Pursuant to this section:

If the person is an individual, they may be liable to a fine of not more than $50,000 or to imprisonment of not more than twelve months, or both;
If the person is a corporation, it may be liable to a fine of not more than $100,000;
If the person is a corporation that has previously been convicted of an offence under this Act:
- if the person has one previous conviction, to a fine of not more than $250,000; or
- If the person has more than one previous conviction, to a fine of not more than $500,000.[6]

Proposed AmendmentsThe proposed amendments to the OHSA include:

Constructors and employers have new duties regarding the maintenance of washroom facilities in the workplace, including ensuring that they remain clean and sanitary and keeping records of such cleaning;
The definitions of “workplace harassment” and “workplace sexual harassment” are expanded to include acts of virtual harassment enacted through the use of information and communications technology;
The application of the Act is expanded to include telework performed in or about a private residence; and
Information can be “posted”, pursuant to requirements under the Act by making them available in an electronic format if (a) employers provide workers with instructions on how to access the information and (b) if the information can be readily accessed by workers in the workplace.

Takeaways for Employers: These proposed amendments largely address the new reality of virtual work environments. An employer’s duty to ensure a safe work environment does not change when the workplace is largely virtual. Employers can also use virtual spaces to fulfill some of their obligations under the OHSA.

The proposed amendments to the ESA include:

New obligations are imposed on employers who publicly advertise job postings, including disclosing whether the posting is for a currently vacant position and other information to be prescribed, within a set time frame of the applicant’s interview;
Employers may require evidence reasonable in the circumstances that an employee is entitled to sick leave, but cannot require a certificate from a qualified health practitioner;
The maximum fine that could be imposed on a person for contravening the Act is increased from $50,000 to $100,000.
- Similarly, ESA Reg. 289/01 is to be amended to increase the fine for offenders of a third or subsequent contravention affecting multiple employees in a three-year period from $1,000 to $5,000, multiplied by the number of affected employees.

Takeaways for Employers: The proposed amendments represent a strong deterrent for potential non-compliant employers. Employers who have been sanctioned for non-compliance in the past should be especially careful to avoid repeat offences, given the heightened cost consequences associated with them. Employers should also be aware of their disclosure obligations if they use publicly advertised job postings and keep up to date with the information which must be provided. Employers may also be required to alter their policies on sick leave, given that employers are no longer permitted to require employees to produce sick notes. It is yet to be seen what will constitute “evidence reasonable in the circumstances” in the absence of documentation from a medical professional.

If you would like more information about these amendments or would like legal advice to ensure your place of work follows these new requirements, please contact experienced employment lawyer, Marty Rabinovitch, of Devry Smith Frank LLP at 416-446-5826 or marty.rabinovitch@devrylaw.ca.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs

This blog was co-authored by Summer Law Student, Jason Corry and Articling Student, Leslie Haddock.

[1] Hon. David Piccini, “Bill 190, Working for Workers Five Act, 2024,” Legislative Assembly of Ontario, online:

www.ola.org/en/legislative-business/bills/parliament-43/session-1/bill-190.

[2] Occupational Health and Safety Act, RSO 1990, c O.1, s 6(1) [OHSA].

[3] Ibid, s 66(1).

[4] Ibid, s 66(2).

[5] Employment Standards Act, 2000, SO 2000, c 41, s 91 [ESA].

[6] Ibid, s 132.

The post What Will the Working for Workers Five Act Mean for Employers? first appeared on Devry Smith Frank LLP.

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One of the unfortunate circumstances of defaulting on mortgage obligations is the possibility of foreclosure or power of sale. These terms are often, but incorrectly, used interchangeably. Both foreclosure and power of sale result in repossession and sale of the home, but the manner in which the repossession occurs differs depending on which process is used.

Power of SaleA power of sale is the most common forced sale process. A power of sale occurs when the mortgagee (the lender), obtains the legal right to evict the occupants of a property due to a default in their mortgage payment. The mortgagee then sells the property to recover any funds owing.

The power of sale process begins with the issuance of a Notice of Sale by the mortgagee. Once that is granted, there is a 35-day redemption period in which the mortgagor (the borrower), can bring mortgage arrears current.

If the mortgagor is unable to pay the arrears, the mortgagee will receive an issuance of judgment by the court. At that point, the mortgagee can obtain a Writ of Possession and proceed to sell the home.

ForeclosureIn a foreclosure, the mortgagee takes the legal title to the property. In other words, the mortgagee has complete ownership and control over the property and can sell the property as they see fit. Foreclosures may be preferable to lenders when the real estate market is down, and the value of the property is not currently high enough to repay the mortgage debt.

To commence an action for foreclosure, the mortgagee files a Notice of Intention to Redeem. Upon receiving a final order of foreclosure, the mortgagee is free to deal with the property however they want.

This process is lengthier and typically does not begin until several months of missed payments.

A court of equity is willing to hear a meritorious application for relief and set aside a final order of foreclosure. Banbury v Tahir outlined five requirements that must be satisfied:

reasonable promptness on the part of the applicant;
reasonable prospect of payment at once or in a short period of time;
activity on the part of the applicant to raise the money necessary to redeem on time;
the applicant must have a substantial interest in the property; and
where the property has been sold after foreclosure, the rights of the purchase will not be unduly prejudiced.

Below is a list of key differences between the two terms.

This blog was co-authored by summer law student, Barbara Attia.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

The post Foreclosure vs. Power of Sale – What are the Differences? first appeared on Devry Smith Frank LLP.

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Devry Smith Frank LLP is proud to announce that we have been recognized by Best Lawyers in Canada for their 2025 Edition with 10 of our lawyers ranked across various practice areas. The lawyers being recognized are listed below:

David Lavkulik – Personal Injury Litigation – Recognized since 2022
Diana L. Solomon – Family Law – Recognized since 2022
George O. Frank – Personal Injury Litigation – Recognized since 2022
Jennifer K. Howard – Family Law – Recognized since 2022
Marc G. Spivak – Personal Injury Litigation – Recognized since 2022
Marty Rabinovitch – Labour and Employment Law – Recognized since 2024
Todd E. Slonim – Family Law – Recognized since 2022
Dejan Ristic – Personal Injury Litigation – Recognized for the first time in the 2025 edition of Best Lawyers
James M. Satin – Insolvency and Financial Restructuring Law – Recognized for the first time in the 2025 edition of Best Lawyers
Kelli Preston – Real Estate Law – Recognized for the first time in the 2025 edition of Best Lawyers

Best Lawyers is the oldest peer-reviewed publication and a prominent online platform that has evaluated and ranked lawyers and law firms for over 40 years. Through a peer-review process, Best Lawyers selects exceptional legal professionals across more than 100 practice areas based on outstanding feedback, serving as a valuable resource for clients seeking highly regarded lawyers.

We are grateful for this recognition and will continue to provide the best service for our clients.

To learn more about this recognition, please visit www.bestlawyers.com/canada.

The post DSF is Recognized in Best Lawyers 2025 Edition first appeared on Devry Smith Frank LLP.

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In a 2022 Ontario Superior Court of Justice decision Ahluwalia v. Ahluwalia,[1] Justice Mandhane created a new tort of family violence.

FactsThe parties married in November 1999 and separated in July 2016. This marriage was anything but typical. Rather, it was characterized by abuse and sixteen years of coercion and control from the father. During the course of their marriage the parties had two children together. However, since separation, the children refused to see their father aside from a few visits.

Trial Decision Justice Mandhane awarded the mother damages in the amount of $150,000 for compensatory, aggregated, and punitive damages as a result of emotional, physical and financial control.

The trial judge also recognized a new tort of family violence. Justice Mandhane believes that this new tort would effectively address the reality of prolonged family violence which is not captured from existing torts.

Further, this new tort remedy would provide survivors of domestic abuse an avenue to pursue accountability and provide financial independence by attending a single proceeding rather than multiple, which is often required with other tort actions. This could potentially make it more realistic for women to leave violent relationships. [2]

Justice Mandhane set out a three part test to establish the defendant’s liability where their conduct is:

is violent or threatening, or
constitutes a pattern of coercive and controlling behaviour, or
causes the plaintiff to fear for their own safety or that of another person.[3]

The trial judge acknowledges that these three steps overlap with existing torts, however, notes that the existing torts “do not fully capture the cumulative harm associated with the pattern of coercion and control that lays at the heart of family violence cases”.[4] The tort of family violence would allow consideration of, and compensation for, the pattern of violence,[5] not just the individual incidents as seen with alternate tort actions.

Ontario Court of AppealShortly after, the Ontario Superior Court of Justice’s decision was appealed to the Ontario Court of Appeal.[6] Here, Justice Benotto rejected the creation of the new tort of family violence on multiple grounds.

First, Justice Benotto notes that common law change is slow and incremental rather than quick and dramatic.[7] Thus, suggesting that this change would be significant and best left to the legislature as opposed to the court system.

Second, Justice Benotto suggests that existing tort remedies effectively address family violence and the creation of a new tort is therefore unnecessary. In the present case, Justice Benotto notes that the father’s abusive conduct satisfies the requirements for the tort of battery, assault, and intentional infliction of emotional distress.[8] Justice Benotto states that these tort actions adequately address the potential issues that would arise under the novel tort remedy.

National ImportanceThe Court of Appeal’s decision has now been appealed to the Supreme Court of Canada. This decision has yet to be heard.

The rejection of the tort of family violence from the Ontario Court of Appeal can be disappointing to survivors of family violence, but a positive decision may come about from the Supreme Court of Canada.

Multiple not for profit foundations such as Barbra Schlifer Commemorative Clinic and Luke’s Place have intervened to provide a more nuanced and intersectional perspective to the court about the prevalence and nature of family violence and the experience of survivors of patterns of abuse. These foundations argue that the tort of family violence is an important and necessary step for the evolution of common law. They note that existing torts do not properly capture and compensate the true nature of family violence that is a pattern of coercive and controlling behaviour.

Statistics Canada further exemplifies the magnitude of domestic violence in Canada and illustrate the need for the new tort of family violence. In 2022 alone, there were 129,876 victims of police-reported family violence and 117,093 victims of intimate partner violence.

Domestic Abuse Services Oxford demonstrates that family violence can lead to extreme circumstances, such as homicides. They note that spousal homicides account for 15% of all homicides in Canada. Women are at greatest risk and are nine times more likely to be murdered by an intimate partner than by a stranger.

Given the magnitude of the issue at hand, it is hoped that the Supreme Court of Canada decision will provide clarity on this legal issue, and also adequately compensate and support victims of family violence.

This blog was co-authored by Summer Law Student, Adriana Piccolo

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

[1] 2022 ONSC 1303 [Ahluwalia].

[2] Ahluwalia v. Ahluwalia, 2023 ONCA 476.

[3] Ahluwalia, supra note 1 at para 52.

[4] Ibid at para 54.

[5] Ibid at para 23.

[6] Ahluwalia, supra note 2.

[7] Ibid at para 50.

[8] Ibid at para 52.

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In Canada, individuals married in India can apply for a divorce if one spouse has resided in a Canadian province for over a year. This process is recognized by both Canada and India, though the legalities and implications differ significantly between the two countries. Understanding these differences is crucial for couples going through the process of international divorce.

Legal Jurisdiction and Criteria for Filing for Divorce in CanadaThe Divorce Act governs divorce proceedings across Canada, although provincial regulations may also apply. To initiate a divorce, one spouse must reside in the province where the application is filed. Couples must meet certain conditions to file for divorce in Canada. The most common ground is a one-year separation, during which the couple has lived apart (whether in the same home or separately) and ceased acting as a married couple. Exceptions to the one-year separation include cases of adultery or cruelty, which require substantial proof. There are three types of divorces in Canada: joint, uncontested, and contested, each with its own procedural nuances. Consulting a family lawyer is advisable to navigate the specific legal requirements and ensure a smooth process.

Impact of International Marriages on Divorce ProceedingsIndian couples in Canada face unique challenges when seeking a divorce due to differences in legal frameworks. In India, divorces can be either mutual or contested. A mutual divorce involves a six-month waiting period, while contested divorces require prolonged court proceedings. In Canada, joint divorces allow couples to file a notice of family claim together, potentially avoiding court if uncontested. Contested divorces, however, can be lengthy and complex, necessitating court involvement. For a marriage from India to be recognized in Canada, it must comply with Canadian legal standards. This often involves validating the marriage through documentation and ensuring it adheres to both Indian and Canadian laws.

Divorce can also affect immigration status. Permanent residents generally remain unaffected unless the marriage is proven fraudulent. Divorce might impact citizenship applications, potentially delaying or affecting the outcome. Engaging a family lawyer and immigration lawyer knowledgeable in international marriages is beneficial to avoid legal complications during divorce proceedings.

Recognizing Foreign Marriages under Canadian LawMarriages conducted legally in another country are typically recognized in Canada. This means that for couples married in India, their marriage is considered valid, allowing them to seek a divorce in Canada without first divorcing in India. One spouse must have lived in a Canadian province for at least a year to apply for divorce under Canadian jurisdiction.

Procedure to File for Divorce in CanadaInitiating a divorce in Canada involves several steps including filing a divorce application, serving the application to the other spouse, waiting for their response, attending court hearings if necessary, and obtaining the divorce order. Proper documentation is essential, including the divorce application, a Notice of Family Claim, and potentially financial statements or affidavits. Consulting a family lawyer ensures all necessary documents are correctly prepared and submitted.

Comparing Divorce Laws: Canada vs. IndiaKey differences between divorce laws in Canada and India include types of divorce, waiting periods, and duration. Canada offers joint, uncontested, and contested divorces, while India provides mutual and contested divorces. India requires a six-month waiting period for mutual divorces, whereas Canada generally mandates a one-year separation. Contested divorces in India can take years, whereas in Canada, contested cases might be resolved more quickly, sometimes through desk order divorces. Canadian law permits divorce primarily due to marriage breakdown, evidenced by a one-year separation, adultery, or cruelty. In India, divorce grounds include adultery, cruelty, desertion, religious conversion, and mental instability. The Hindu Marriage Act and the Special Marriage Act govern these proceedings, with mutual petitions simplifying the process compared to contested cases.

ConclusionProceeding with a divorce across international boundaries requires a comprehensive understanding of applicable laws and meticulous preparation. Engaging experienced family lawyers helps both parties adhere to procedures and protect the individual rights of those involved, making the process more manageable. Whether the marriage took place in India or another country, consulting a lawyer and ensuring all documentation is in order before initiating divorce proceedings is crucial. Each situation is unique, so obtaining tailored legal advice is the best way to safeguard one’s interests during this challenging time.

If you have questions about getting a divorce in Canada if you were married in India or other family law-related topics, please contact Katelyn Bell, family lawyer at Devry Smith Frank LLP at 416-446-5837 or katelyn.bell@devrylaw.ca

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

The post Can I Get a Divorce in Canada if I Was Married in India? first appeared on Devry Smith Frank LLP.

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When two parties have dependant children, they may be required to pay special or extraordinary expenses alongside their basic monthly child support obligations. The definition of these expenses are outlined in Section 7 of the Child Support Guidelines.

Section 7 reads that in an order for the support of a child, the court may, on request of either parent or spouse provide for an amount to cover all or any portion of applicable expenses. What is qualified as a “section 7 expense” is determined based on various considerations. The court will take into account the necessity of the expense in relation to the child’s best interests, the reasonableness of the expense in relation to the means of the parents or spouses, and those of the child with respect to the family’s spending pattern before separation. Applicable expenses may include child care expenses, health-related expenses such as braces, expenses for post-secondary education (tuition, meal plans, textbooks) and extraordinary expenses for primary or secondary school education or extracurricular activities.

The Guidelines lay out what falls under applicable extraordinary expenses. Extraordinary expenses are expenses that exceed the amount that the requesting parent or spouse could reasonably cover, while taking into account the parent or spouse’s income and the amount that would be received for child support. The court also considers expenses to be extraordinary by considering various other factors including but not limited to: the nature and number of the educational programs and extracurricular activities, and any special needs and talents of the child.

Determining a Section 7 ExpenseA common question is what exactly may be considered an extraordinary section 7 expense. As discussed above, the court will consider many factors and it is not just the expense alone that is considered. For example, in the case of Craig v. Niro, 2022 ONSC 5178, the question of whether the daughter’s hockey equipment and the son’s moving expenses were an extraordinary expense were considered.

The court considered the factors outlined in the Guidelines and determined that the daughter’s hockey equipment was not an extraordinary expense but the son’s moving expenses were considered to be an expense under section 7. The parents in this case had an order in place that the mother pay 36% and the father pay 64% of section 7 expenses. The mother and daughter contributed to the daughter’s hockey equipment. Considering these contributions and the father’s income, the remaining hockey expenses were considered modest and within the amount of child support set off against the amount that the father would otherwise pay. He was not required to make additional contributions towards hockey. The son’s moving expense; however, was determined to be a post-secondary education expense and therefore a section 7. To qualify as a post-secondary education expense, the expense must be sufficiently connected to the program of study. In this case it was concluded that the expenses associated with the purchase of furniture, appliances, food, toiletries and even “shower flip flops” are properly characterized as post-secondary education expenses for a temporary residence being shared while at university. Even the hotel room and restaurant meals while a student’s belongings are being moved into a temporary residence was deemed to be covered as a section 7 expense.

In certain circumstances, an adult child will be responsible for contributing toward section 7 expenses, which is discussed further below. However, in Craig v. Niro, many of the expenses were incurred because the mother refused to assist with the physical move of the son’s items that did not fit in the father’s vehicle. As a result, it was found to be unfair that the son be required to contribute to these moving expenses. Whether or not an expense is found to be extraordinary and how section 7 is inferred is discretionary to the courts. It is helpful to consult with a family law lawyer about any questions related to section 7 expenses as every situation varies.

Children’s Contributions to Section 7 ExpensesThe case of Lewi v. Lewi, 2006 CanLII 15446 (ON CA) raised the issue of children’s contributions to post-secondary education expenses, specifically, adult children who attend post-secondary studies. Whether the parents should be solely responsible for their children’s post-secondary education when the child has a job or in the case of Lewi, had significant capital assets as a result of gifts from their grandfather, was discussed extensively. The Court of Appeal in Lewi considered that as a general rule, adult children should be required to make reasonable and meaningful contributions toward post-secondary education expenses. The amount they should contribute is dependent on the circumstances and will consider the means of both the parents and the children. In this specific case, one of the sons attended post-secondary studies out of town and at a much greater cost than his brother, which therefore required a greater contribution from him.

Ultimately, the determination of section 7 contributions and extraordinary expenses are extremely fact-dependent. Should you require more information regarding section 7 expenses and/or family law-related topics, please contact our family law department.

If you have questions about Section 7 expenses or other family law-related topics, please contact Katelyn Bell, family lawyer at Devry Smith Frank LLP at 416-446-5837 or katelyn.bell@devrylaw.ca

This blog was co-authored by Articling Student, Samantha Lawr

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

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Joint tenancy is a legal arrangement where multiple people own a property equally together. If one of the owners dies, the property that is owned jointly will pass automatically to the surviving owner(s). People have used joint tenancy as an estate planning mechanism to avoid the payment of probate fees.

In Jackson v. Rosenberg, the court examined whether Mr. Jackson’s transfer of his home’s title to himself and Ms. Rosenberg, his late partner’s great-niece, as joint tenants, was a gift or created a resulting trust in Mr. Jackson’s favour. This case illustrates the importance of determining the true intent behind property transfers, particularly in estate planning contexts.

Case Background: Jackson v. RosenbergIn the case Jackson v. Rosenberg, the question considered is whether Mr. Jackson’s transfer of title of his home from himself as a sole owner to himself and Ms. Rosenberg as joint tenants, for no consideration, created a resulting trust in Mr. Jackson’s favour, or whether the transfer was intended to be a gift for Ms. Rosenberg. Ms. Rosenberg was the great-niece of Mr. Jackson’s long-time romantic partner.

Mr. Jackson and his partner executed a will which named the other as the sole beneficiary of their respective estates and named Ms. Rosenberg as the alternate beneficiary. Mr. Jackson and his spouse owned a condominium that Mr. Jackson sold after the death of his spouse. He used the proceeds to purchase the Port Hope property. He was the sole registered owner of this property. He paid for the property and upkeep with his own funds and Ms. Rosenberg did not make any contributions to the property nor did she reside there at any point. In 2012, Mr. Jackson transferred the property from himself as the sole owner to himself and Ms. Rosenberg as joint tenants with the right of survivorship.

In 2020, Mr. Jackson instructed his lawyer to sever the joint tenancy after Ms. Rosenberg and her husband informed him that they planned to upgrade the home so they could sell it and use the proceeds to purchase a two-storey property on a golf course and would allow Mr. Jackson to reside with them. Mr. Jackson was concerned that they would take steps to force him out of his home. Mr. Jackson claimed that he did not intend to gift a portion of the home to Ms. Rosenberg but wanted to have the property with whatever equity was left in it to pass to Ms. Rosenburg without her having to pay the probate fees. Ms. Rosenburg claims that any interest in the property transferred to her was an unconditional gift by Jackson. Mr. Jackson takes the position that the transfer was not a gift but a resulting trust with the beneficial ownership being retained by Mr. Jackson.

Presumption of Resulting TrustThis case adopts the law relating to the presumption of resulting trust as set out in Pecore v. Pecore, stating that “aresulting trust arises where the property is in one party’s name, but impressed with an obligation to return the property either because the holder is a fiduciary or because the transferee gave no value for the property.”

Gratuitous TransfersThey also review the law surrounding gratuitous transfer, as summarized in Bradshaw v. Hougassian, stating that:

Where a gratuitous transfer is made, there is a rebuttable presumption that the transferor intended to create a trust rather than to make a gift, on the principle that “equity presumes bargains and not gifts”. The onus is on the person receiving the transfer to demonstrate that a gift was intended, failing which the transferee holds the property in trust for the transferor.

Conditions of a GiftIn determining the transferor’s actual intention, the courts must weigh all of the evidence to determine, on a balance of probabilities, what the transferor intended. To establish that this property was indeed a gift to Ms. Rosenberg, she was required to satisfy the following three conditions:

An intention to make a gift on the part of the donor without consideration or expectation of remuneration;
An acceptance of the gift by the donee; and,
A sufficient act of delivery or transfer of the property to complete the transaction.

The transfer of property was intended to avoid the payment of estate administrative taxes when the property was transferred to Ms. Rosenberg. The judge was satisfied that Mr. Jackson’s intention at the time of transfer was to gift the right of survivorship in the property to Ms. Rosenberg, and whatever equity remained in the property after his death should pass to Ms. Rosenberg and not to his estate.

Court’s DeterminationThe right of survivorship could not be revoked, but Mr. Jackson retained all remaining rights and interests in the Port Hope property during his lifetime. The severance of joint tenancy eliminated Ms. Rosenberg’s right of survivorship with respect to Mr. Jackson’s 50% share, but he could not revoke the right of survivorship with respect to Ms. Rosenberg’s 50% share. This means, that when Mr. Jackson dies, his 50% share will become part of his Estate and will be distributed according to his Will. However, Ms. Rosenberg’s share of whatever equity is remaining in the property will pass to her in accordance with the intention of the original 2012 transfer.

ConclusionThe court’s decision emphasized that while Mr. Jackson intended to avoid probate fees by granting Ms. Rosenberg the right of survivorship, his primary intention was not to gift her the property during his lifetime. The case of Jackson v. Rosenberg highlights the complexities of joint tenancy and the importance of clearly understanding and documenting the intentions behind property transfers.

If you have questions about joint tenancies or estate planning, please contact Esther Abecassis, wills and estates lawyer at Devry Smith Frank LLP at 416-446-3310 or esther.abecassis@devrylaw.ca.

This blog was co-authored by Articling Student, Toni Pascale.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

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Cryptocurrency utilizes technology that creates, verifies, and secures transactions using digital assets.[1] These assets are rapidly increasing in popularity as a means to capitalize on market gains.[2] The worldwide attention that cryptocurrency has been receiving over the last decade has come not only comes from legitimate investors and profits, but also from bad actors.

Cryptocurrency FraudCryptocurrency crime is growing fast as the technology evolves. Between 2018 and 2020, $12.6 million reported losses were reported as attributable to events involving cryptocurrencies that have been characterized as fraud or scams. This number significantly increased in 2021, where the Canadian Anti-Fraud Centre received reports of cryptocurrency fraud losses totalling $75 million.[3] Furthermore, the Federal Trade Commission states that between Q1 2021 and Q1 2022, 46,000 people lost more than $1 billion to crypto scams. Crypto scams reportedly account for 40% of all dollars reported lost to fraud on social media.[4]

Aiden PleterskiThe recent case of Aiden Pleterski (“Mr. Pleterski”) is a recent banner case in cryptocurrency fraud. Mr. Pleterski, resident of Ontario and self proclaimed “Crypto King,” had raised $41.5 million from investors, promising to invest in cryptocurrency and foreign markets. However, it is alleged that he only invested 1.6% of that money. With the remainder of the proceeds, Mr. Pleterski bought luxury cars, flights on private jets and lakefront mansions.

Mr. Pleterski’s schemes began to unravel in April of 2022. Many of his investors subsequently commenced lawsuits and alleged that he that he misappropriated their money. Mr. Pleterski shortly declared bankruptcy thereafter, and a bankruptcy trustee (the “Trustee”) was tasked with tracking down and recovering as much money for his creditors and other investors as possible.

Mr. Pleterski further hit the headlines in December 2022, when he was kidnapped from downtown Toronto, allegedly by “investors” who had lost money. He was released three days later but under threat to come up with money.

To further complicate the matter, it was recently discovered that Mr. Pleterski had found a new way to use digital assets (but not cryptocurrency this time) to store value. A report from the Trustee in bankruptcy revealed that that Mr. Pleterski transferred more than $500,000 worth of digital currency on video gaming platforms, by selling valuable in-game items called “Skins,” which are forms of customization – somewhat similar to a decal or wrap on a vehicle in real life. These items can be earned or purchased on the gaming platform in exchange for real money or in-game currency.

The Trustee subsequently brought legal action seeking to freeze Mr. Pleterski’s gaming account and requiring the gaming service provider (Valve Corporation) to provide account access to the Trustee.

Digital Assets, Cryptocurrency, and the LawSome suggest that Mr. Pleterski was able to successfully operate his illegal scheme because of the lack of oversight and regulatory framework regarding cryptocurrency assets.[5] With the fast-growing digital world, industry experts and regulators call for better measures to protect investors in order to safeguard against cryptocurrency fraud in the future.[6]

As it relates to the law, it is clear that the rapid development of technology, new forms of digital stores of value, and the increasing number of virtual transactions are permanently influencing and changing the profession. Among other things, litigators must be increasingly responsive and proactive in their efforts to identify assets and recover proceeds of crime. As technology evolves, so too must the law. The Pleterski case highlights a new and unexpected way for money to be hidden, and a novel kind of asset seizure – a gaming account – to accompany it.

If you have been a victim of fraud, contact Graeme Oddy, a lawyer in our commercial litigation department. Reach out by email graeme.oddy@devrylaw.ca or by phone 416-446-5810.

This blog was co-authored by summer law student Adriana Piccolo.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

[1] Canada, Financial Consumer Agency of Canada, Crypto Assets (Government of Canada: 2023) .

[2] Royal Canadian Mounted Police, Countering the rise of cryptocurrency fraud (Government of Canada: 2022) .

[3] Supra note 1.

[4] Tad Simons, “Why the crypto economy needs stricter anti-fraud protocols and other regulations”, Thomson Reuters (11 October 2022), online: .

[5] “The Scandal of Aiden Pleterski, Canada’s Crypto King”, Crypto Definance (17 May 2024), online: .

[6] Ibid.

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In the recent case of 2275518 Ontario Inc. v. The Toronto-Dominion Bank, 2024 ONCA 343, the Ontario Court of Appeal cautioned courts from delaying a creditor’s access to summary judgement motions.

TD Bank, the Respondents, appealed a motion summary judgement granted against the Appellants, 2275518 Ontario Inc, the corporate borrowers, and the Guarantors who defaulted on a loan. The Guarantors allege their lawyer, and the lawyer for TD Bank, failed to register the bank’s security in a first priority position thus making the guarantee void and TD Bank was estopped from enforcing the guarantees

Background This action began with TD Bank who brought a summary judgement motion seeking judgment from the Borrower and Guarantors. Before TD Bank’s summary judgement motion, the Appellants sought to amend their statement of defense to include the lawyer’s negligence in failing to register TD Bank’s security interest in a first priority decision and his misrepresentation regarding the security registration.

When TD Bank’s summary judgement motion came before the motion judge, the judge ordered a mini-trial based on Rule 20.04(2.2). During the mini-trial, the motion judge heard three witnesses, including the lawyer in question, over a three-day period.

The motion judge concluded the lawyer did not mispresent the bank’s security interest and did not find there was a barrier to summary judgement because of the third-party claim.

Issues and DecisionThe Appellants raised three issues at appeal in which they essentially assert errors in the motion judge’s use of the enhanced powers in r.20.04(2.2) which are as follows: the motion judge erred by ordering oral evidence from a non-party, the lawyer, in violation of Rule 20.04(2.2), and in the alternative in making findings of fact an credibility relating to the appellants’ third party claim against the lawyer thereby creating a risk of inconsistent findings of fact and effectively granting partial summary judgment and in the further by granting summary judgment in the main action prior to the determination of the third party claim, thereby prejudicing the appellant’s interests. All of which the Court of Appeal rejected.

Discussion: Court of Appeal overturns Lower Court The judge reaffirmed Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, in which the Supreme Court concluded that the exercise of powers under r.20.04(2.1) attracts deference and a determination that there is no genuine issue for trial should not be disturbed on appeal. A decision to exercise the enhanced powers under the rule is discretionary and, as such, should not be disturbed unless the motion judge misdirected themself or came to a decision that is so clearly wrong that it resulted in an injustice.[1]

Rule 20.04(2.2) states, “oral evidence can be presented by one or more parties.” Further, Rule 1.04(1) and (1.1) state the rules should be interpreted liberally and grants the court the power to make orders proportionate to the complexity of the issues involved.

The Appellants claim the motion judge should not have made findings relevant to the third-party negligence claim when the motion judge did not have all the evidence in front of him. They claim this could lead to a risk of inconsistent findings of fact. However, the Court of Appeal wrote,

“… the summary judgement process is tailor-made to enforce liquidated claims by creditors against debtors and guarantors. Unless there is a genuine issue for trial, the court should be reluctant to delay a creditor’s access to this summary procedure…”[2]

Here, the Court of Appeal is distinguishing the negligence claim from the liquidated claim. This differentiation is important when considering the consequences a prolonged claim would have on creditors. The Court of Appeal highlights the summary judgement’s role in swiftly dealing with creditor claims.

The mini-trial was an appropriate method to hear all necessary witness testimonies and examinations. The Appellants were given the opportunity to merge the third-party action into the main action but chose not to.

ConclusionIn sum, the Court of Appeal’s decision gives creditors a clear picture on how they can effectively use the summary judgement process. It also cautions courts from delaying summary judgement motions and notes the implications that can arise.

This blog was co-authored by Summer Law Student, Barbara Attia.

Sources:

2275518 Ontario Inc. v. The Toronto-Dominion Bank, 2024 ONCA 343

Rule 20.04(2.2)

Rule 1.04(1) and (1.1)

[1] 2275518 Ontario Inc. v. The Toronto-Dominion Bank, 2024 ONCA 343 (CanLII), at para 38, https://canlii.ca/t/k4ghx#par38

[2] 2275518 Ontario Inc v The Toronto-Dominion Bank, 2024 ONCA 343 at para 44.

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Canadian citizenship offers numerous advantages including healthcare, the right to vote, and increased job opportunities, to name a few. The Citizenship Act establishes the criteria for obtaining Canadian citizenship, and circumstances under which an individual’s citizenship can be revoked or lost. Under the Canadian Citizenship Act, a person born outside of Canada would only be granted citizenship through naturalization or if one of their Canadian parents was born in Canada or was naturalized as a citizen of Canada before the child was born—citizenship by descent.

This created a generation of “Lost Canadians” which imposed a first-generation limit to those born outside of Canada. In other words, citizenship by descent did not apply to second and further generations. As a result, many individuals lost their citizenship due to this restrictive legislation. Bill C-71, An Act to Amend the Canadian Citizenship Act (2024) was introduced on May 23, 2024, by the Honorable Marc Miller who said,

“The current rules generally restrict citizenship by descent to the first generation, excluding some people who have a genuine connection to Canada. This has unacceptable consequences for families and impacts life choices, such as where individuals may choose to live, work, study or even where to have children and raise a family. These changes aim to be inclusive and protect the value of Canadian citizenship, as we are committed to making the citizenship process as fair and transparent as possible.”

Substantial Connection TestWith Bill C-71, citizenship will extend beyond the first generational limit for citizenship by descent. Bill C-71 establishes a new framework for citizenship by descent, the substantial connection test. A Canadian parent born outside of Canada must have a substantial connection to Canada in order to pass citizenship to their child born abroad.

To show that a substantial connection to Canada exists, the parent who was born abroad must have been physically present in Canada for 1,095 days before the birth or adoption of their child. This remedies the issue of “Lost Canadians” who would otherwise have been granted citizenship if it were not for the first-generation limit.

What Can be Done in the Meantime?Although Bill C-71 passed the first reading on May 23, 2024, the bill has not yet been granted Royal Assent and become law. The Government of Canada recognizes the importance of this new legislation and so we expect to see the changes implemented in the foreseeable future. For individuals with an urgent need for recognition, they can apply under Subsection 5(4) of the Citizenship Act which permits the Minister to grant citizenship to alleviate cases of statelessness for individuals with special circumstances and unusual hardship.

ConclusionBill C-71 takes a significant step in rectifying the long-standing difficulties “Lost Canadians” face in obtaining citizenship. Bill C-71 would apply retroactively, meaning any child who was previously excluded from obtaining citizenship due to the first-generation limit, is now eligible to receive Canadian citizenship.

If you or your loved ones are affected by these changes, it’s crucial to act now. Our expert immigration law team is here to help you navigate the complexities of Bill C-71 and secure your Canadian citizenship. To take the first step, contact Benjamin Grubner today by emailing benjamin.grubner@devrylaw.ca or calling 416-446-3328.

This blog post was co-authored by summer law student, Barbara Attia.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

Sources:

Bill C-71: An Act to amend the Citizenship Act (2024), The Government of Canada (May 23, 2024), online: https://www.canada.ca/en/immigration-refugees-citizenship/news/2024/05/bill-c-71-an-act-to-amend-the-citizenship-act-2024.html.

Government of Canada introduces legislation for citizenship by descent, The Government of Canada (May 23, 2024), online: https://www.canada.ca/en/immigration-refugees-citizenship/news/2024/05/government-of-canada-introduces-legislation-for-citizenship-by-descent.html.

House of Commons Debates, 44-1, No 316 (23 May 2024) at 1005 (Hon Marc Miller).

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In this article, we delve into what a Shareholders’ Agreement is, its key components, and the risks it addresses.

When two or more individuals go into business they often incorporate a corporation, elect directors, issue shares, and start operations without further thought to the rules that will govern their business. But what happens if someone wants to leave the business? Or if someone takes the corporation’s idea and starts their own business? It’s best to address these questions and mitigate such risks at the outset of the business and while parties are friendly.

What Is a Shareholders’ Agreement?A Shareholders’ Agreement is a legally binding contract among the shareholders of a corporation. It serves as a roadmap for the management and operation of the company and outlines the rights, responsibilities, and obligations of the shareholders. While not a mandatory requirement under Ontario’s corporate law, having a Shareholders’ Agreement is highly recommended for any corporation with more than one shareholder.

Do I Need a Shareholders’ Agreement?Some of the key risks addressed by a Shareholders’ Agreement include:

Disputes Among Shareholders: By providing clear guidelines for resolving disputes, a Shareholders’ agreement helps prevent conflicts that could disrupt the business operations and damage shareholder relationships.
Exit Strategy: In the event of a shareholder’s desire to exit the company or in case of unforeseen circumstances such as death or incapacity, a Shareholders’ Agreement promotes a smooth transition and protects the interests of the remaining shareholders.
Protection of Minority Shareholders: Minority shareholders are particularly vulnerable to being marginalized in decision-making processes. A well-crafted Shareholders’ Agreement can include provisions to safeguard their rights and promote their fair treatment.
Preservation of Confidential Information: Confidentiality clauses protect sensitive information from being disclosed to competitors or unauthorized parties, safeguarding the corporation’s property and competitive advantage.

Contents of a Shareholders’ Agreement.The contents of a Shareholders’ Agreement vary depending on the specific needs and circumstances of the corporation and its shareholders. However, some common provisions typically found in a Shareholders’ Agreement include:

Shareholder Rights and Obligations: This section outlines the rights and obligations of each shareholder, including voting rights, dividend entitlements, and obligations to contribute additional capital.
Management and Decision-Making: The agreement specifies how the company will be managed and the important decision-making processes, such as the appointment of directors, approval of budgets, and major business transactions.
Transfer of Shares: This section addresses the circumstances under which shareholders can transfer their shares, including any restrictions on transfers and rights of first refusal. It may also create circumstances where an individual must sell their shares, such as upon leaving the employ of the corporation, and the share value of such repurchases.
Dispute Resolution: A crucial aspect of any Shareholders’ Agreement, this section outlines mechanisms for resolving disputes among shareholders, such as mediation or arbitration, or mandatory buy-sell provisions, to reduce the risk of litigation.
Confidentiality and Non-Competition: This clause protects the corporation’s sensitive information and prevents shareholders from competing with the company during and after their tenure.

A Shareholders’ Agreement is a vital legal document for corporations, providing clarity, structure, and protection for shareholders. Our corporate law team can help you draft or review a Shareholders’ Agreement so that it accurately reflects your intentions and protects you from risks.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

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A memorandum or letter of wishes is a document containing an expression of wishes to your executors and beneficiaries with information on how you would like your estate to be administered. It is not a Will.1

There are two types of memorandums: The first is a precatory memorandum and is not legally binding. It is a mere expression of your wishes with respect to the distribution of certain items. The second type of memorandum is a legally binding memorandum and must be incorporated into your will by reference.2

When writing a memorandum of wishes, a few things must be considered to ensure your wishes are honoured.

1. This is not your Will.

It is essential to clarify that this memorandum of wishes is not your Will and does not revoke any Wills. A memorandum of wishes should work alongside a Will and not contradict it. You should indicate that this memorandum reflects your wishes only.

Consider including a statement clarifying that you have executed your last Will and Testament and that you acknowledge that your Will determines how your estate will be distributed after passing. It is important to include, in clear language, that this memorandum of wishes does not revoke any Wills or change any provision of your Will.

A note in your handwriting and signed could be considered a holographic will and can actually have the unintended consequence of revoking your last will and testament. To be safe, consult your lawyer.

2. A precatory memorandum of wishes is not legally binding, so it does not have the same effect as a Will.

A memorandum of wishes is not the same as a Will. A Will is a legal document that will devise, bequeath, or dispose of all property you have at the time of death.3 When you draft a Will, you assign an executor of your estate, who is responsible for carrying out the wishes laid out within your Will. This executor can also be responsible for carrying out your wishes in a memorandum of wishes; however, if you choose to draft a precatory memorandum of wishes, the executor is not legally required to follow it.4 The benefit of a precatory memorandum is that you can change it as many times as you’d like without changing your will.

Generally, when choosing your executor, you should have faith that they will act in your best interest in following your Will while also maintaining the wishes laid out in this additional document.

3. To make a memorandum of wishes legally binding, you must incorporate it by reference into your will.

If you would like to ensure that your memorandum of wishes is legally binding, you must incorporate it by reference into your will. To do this, you must create the memorandum of wishes before the will, it must be referred to specifically in the will, and the document must be sufficiently described so that it can be identified. 5 If you would like to make revisions to the memorandum of wishes, you will have to make repeated revisions to the will.

If you are choosing to use a legally binding memorandum, it is important to date it so that there is no dispute that it was drafted prior to the will in the case that it is contested. 6

3. Ensure your executor knows the memorandum of wishes exists.

Ensure that the executor of your estate knows of the existence of your memorandum of wishes and its location so that your wishes are properly represented when administering your estate.

4. What can you include?

It is important to include items that you wish for your decision to be binding within your Will. Requests that you can include in a memorandum of wishes include7:

Specific descriptions of personal belongings that you do not believe to be disputed and are not listed within your will and the names of beneficiaries;
Social media accounts;
Organ donations; and,
Decisions regarding burial vs. cremation

This list is not exhaustive but provides an idea of the items typically dealt with in a memorandum of wishes if you choose not to include them in a Will.

Be sure to consider contingencies in a memorandum of wishes just as you would in a Will in case of the event that a beneficiary predeceases you.

4. What should you not include?

Items that you are already addressing in a Will;
Items that you are adamant about giving to a particular person – this should be included in a will to prevent issues;
Items that you believe could give rise to issues between beneficiaries;
Items of a significant monetary value;
Items of a significant sentimental value; and,
Gifts to charity.

This list is not exhaustive but conveys the difference between the items that can be included in the memorandum of wishes versus the items that should be addressed within a Will.

For more information regarding wills and estates-related topics, please contact Esther Abecassis at Devry Smith Frank LLP at (416) 446-3310 or esther.abecassis@devrylaw.ca.

This blog was co-authored by Articling Student, Toni Pascale.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

[1] James Cooper Morton & Risa M. Stone, Essential Estate Administration in Ontario (Toronto: CCH Canadian Limited, 2002) at 16.

[2] Mary-Alice Thompson & Robyn Solnik, Drafting Wills in Ontario: A Lawyer’s Practical Guide (Toronto: CCH Canadian Limited, 2003) at 77.

[3] Succession Law Reform Act, RSO 1990 c. S.26, s.2.

[4] Supra note 1.

[5]Susannah Roth & Mary-Alice Thompson, “The Annotated Will, 2017” (January 2017), online: LSO Store https://store.lsuc.on.ca/Content/pdf/2017/CLE17-00104/0%20COMBINED%20MATERIALS%20as%20of%20Jan%205.pdf.

[6] Ibid.

[7] Supra note 5.

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Throughout the COVID-19 pandemic, many businesses were struggling. The federal government implemented various programs to assist and support Canadian businesses that were suffering from economic loss as a result of the pandemic. To name a couple, the Highly Affected Sectors Credit Availability Program (HASCAP) and the Canada Emergency Business Account (CEBA) were implemented. The lending banks were responsible for authorizing and administering the loans. The loans were backstopped by the Business Development Bank of Canada.

A recent decision, 7572042 Canada Inc. v. The Bank of Nova Scotia, 2023 ONSC 3405, touches on the consequences of doing so.

Facts The plaintiffs in this case are without counsel and Mr. Barake was granted leave to represent the corporate plaintiffs. From March 2021 to November 2022, Mr. Barake applied for HASCAP loans from Scotiabank (the “Bank”) on behalf of the corporate plaintiffs in the amount of $3,861,000.00. The bank advanced additional loans to the plaintiffs under the CEBA program for $720,000.00. Both of these loans were based on the strength of the plaintiff’s representations to meet the qualifications, which included various financial statements from 2018-2020, portraying the plaintiffs (business) as operating with significant assets, revenues and expenses. The 2020 financial statement for the plaintiffs showed, in aggregate, assets over $11 million and sales revenue of over $14 million.

The plaintiffs borrowed about $4.581 million from the Bank and represented the single largest group of loans made by the Bank under these programs. The Bank therefore conducted a review of the plaintiffs and their loans, which raised serious concerns about the intentions of Mr. Barake and the other Borrowers. The Bank froze the plaintiffs’ bank accounts and the Bank’s investment arm, Scotia Capital, also froze certain investment accounts where Mr. Barake had transferred most of the funds borrowed from the Bank using the HASCAP and CEBA programs.

This claim was initiated by the plaintiffs against the Bank for unlawfully freezing their account and claiming damages of $80 million. The Bank moves for summary judgment dismissing the plaintiffs’ action and granting their counterclaim denying the plaintiffs’ allegation and suing for the amounts owed under its loans with interest and costs. The Bank also sought a Mareva injunction against the plaintiffs, which was granted. The plaintiffs therefore could not move around any assets in their control.

IssuesThe court had various issues to consider in this case. Two of the main issues at bar were the following:

Whether summary judgment should be granted allowing the Bank’s counterclaim;
Whether summary judgment should be granted dismissing the plaintiffs’ action against the Bank.

Analysis:1. The Counterclaim

To consider whether summary judgment should be granted, the court considers whether or not there is a genuine issue requiring trial under Rule 20.04 of the Rules of Civil Procedure. With respect to the Bank’s counterclaim, it was therefore considered whether the loans advanced to the plaintiffs were obtained by means of fraudulent misrepresentation. A claim for fraudulent misrepresentation requires there to be proof of four elements:

1. A false representation made by the defendant;
2. Knowledge of the falsehood of the representation (whether knowledge or recklessness);
3. The false representation caused the plaintiff to act; and
4. The plaintiff’s actions resulted in a loss

Mr. Barake on behalf of the Borrowers represented and warranted to the Bank that the borrowers met the requirements to quality for both a HASCAP loan and a CEBA loan. The four elements above were considered and the evidence was found to prove each of these four elements on a balance of probabilities. The business accounts opened at the time of the loans reveal no income, revenue or business expenses and the domain names for the Borrowers were all created immediately prior to the loan applications being made yet the plaintiffs had no business premises. As well, the Bank advanced funds in the amount of $4.581 million and the funds were misused even with the Bank’s efforts to prevent the loss. The funds were obtained based on fraudulent misrepresentations by Mr. Barake on behalf of the corporate plaintiffs.

The Plaintiff’s Claim

The court also considered whether there was a genuine issue requiring trial with respect to Mr. Barake’s Plaintiff’s Claim. Mr. Barake brought his initial claim alleging that the Bank unlawfully froze the plaintiffs’ accounts and that as a result, the plaintiffs suffered losses. The plaintiffs did not produce any evidence in support of their claims and the Borrowers had acknowledged in the banking agreements for the loans that the Bank may freeze any funds in any account at any time without notice in the event of: default, any representation being untrue, and in circumstances where the Bank has reason to suspect that the Borrowers have engaged in any improper or unlawful activity. The Bank had conducted an investigation that raised issues about the validity of the loans and the transfer of their loans to Mr. Barake’s self directed investment accounts and therefore it was not unlawful for the Bank to freeze the plaintiffs’ bank and investment accounts, nor did the plaintiffs offer any evidence in support of their claims.

ConclusionJudgment was granted for the two main issues as the court was satisfied that there was no genuine issue requiring a trial. The plaintiffs’ claim was dismissed and are ordered to pay back their loans obtained under false pretences, including interest and costs to the Bank.

This blog was co-authored by articling student Samantha Lawr.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

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Employees who are terminated without cause are entitled to either reasonable notice or payment in lieu of reasonable notice. This is the “Notice Period” an amount of time, or a level of compensation, to assist a dismissed employee find comparable work. At common law, the Notice Period is “reasonable notice,” which varies with the circumstances of any particular case. (For a history of the development of the common law, see Machtinger v HOJ Industries Ltd).[1] The Notice Period is also a statutory entitlement pursuant to the Employment Standards Act, 2000.[2]

This Notice Period entitlement is the “damages” experienced by the employee as a result of the wrongful termination. “Mitigation” is a limiting principle in damages, imported into the employment context from contract law.[3] In other words, when an employee has been terminated without cause, they have a legal duty and obligation to act reasonably by taking steps to replace their income.

Read more: Employers Must Discharge Their Onus to Prove Failure to Mitigate

When it comes to fulfilling mitigation obligations, terminated employees with incapacitations or other limitations face unique challenges. For some terminated employees with physical or mental health issues, it may seem daunting or even impossible to fulfill this duty. As a recent decision of the Ontario Court of Appeal illustrates, terminated employees with incapacitations may nonetheless fulfill their mitigation obligations — even with negligible attempts to find alternate employment.

Krmpotic v Thunder Bay Electronics Limited, 2024 ONCA 332[4]In 1974, Drago Krmpotic commenced his employment with Thunder Bay Electronics Limited and Hill Street Financial Services. Mr. Krmpotic was a loyal employee who performed a broad range of physically demanding skilled tasks. After nearly thirty (30) years of devoted service, Mr. Krmpotic was terminated without cause.

Immediately prior to his termination, Mr. Krmpotic had been on medical leave to recover from back surgery, a procedure which was necessitated as a direct result of four different back injuries he sustained at work. Nonetheless, Mr. Krmpotic was terminated by his employers only hours after he returned to work following his surgery. At the time, he was sixty-nine (69) years old.

The manner of dismissal rose above the normal distress and hurt feelings caused by a dismissal. Consequentially, Mr. Krmpotic experienced anxiety, depression, fear, poor sleep, frustration, and feelings of helplessness and defeat. He also continued to suffer such physical ailments such as back pain and knee pain as a direct result of his workplace injuries.

At trial, it was determined that Mr. Krmpotic was entitled to a notice period of twenty-four (24) months, together with aggravated damages owing to the manner of dismissal.

See related reading: Notice Periods for Employees Terminated Without Cause May Exceed Twenty Four Months if the Circumstances are ‘Exceptional’

During the notice period, Mr. Krmpotic did not mitigate his damages — he was simply unable as a result of his incapacity.

Mr. Krmpotic’s employers argued that this notice period should be reduced based on his failure to mitigate his damages. Indeed, the trial judge noted that his efforts to replace his income were “scant at best.” However, this fact was considered in context together with his age, the fact that he was recovering from back surgery related to his work, and that he was “significantly limited in his ability to perform the physical labour which his occupation demands on a daily basis.”

Notably, the latter finding that Mr. Krmpotic was substantially physically hindered was not established through any expert medical evidence, but through the evidence of Mr. Krmpotic and his immediate family members. Specifically, the trial judge accepted the evidence of Mr. Krmpotic’s wife and son that he was unable to work during the applicable notice period.

Crucially, the Court explicitly rejected the notion that physical incapacity can only be established by expert medical evidence. In fact, the Court found that the trial judge properly considered a medical report which described that while Mr. Krmpotic had some physical capacity, it was silent regarding his ability to carry on highly demanding physical labour.

On appeal, the Court did not disturb the trial judge’s finding that Mr. Krmpotic was physically incapable of performing physically demanding work during the applicable notice period. Thus Mr. Krmpotic fulfilled (or obviated) his duty to mitigate his damages due to his incapacitation. The Court also did not disturb the award of aggravated damages, despite also being in the absence of expert medical evidence.[5]

ConclusionThis case sheds light on the unique challenges faced by terminated employees with incapacitations. Despite the daunting task of seeking alternate employment, particularly for those grappling with physical or mental health issues, the Ontario Court of Appeal’s decision in Krmpotic underscores that such employees may still meet their mitigation duties.

Takeaways for employers:

When dealing with employees, be candid, reasonable, honest and forthright, and refrain from engaging in conduct that is unfair or in bad faith by being untruthful, misleading or unduly insensitive.
Acknowledge and accommodate the unique challenges faced by terminated employees, particularly those with incapacitations or other health issues.
Understand that employees with limitations may face difficulties fulfilling mitigation duties and that these factors should be considered when assessing termination outcomes.

Takeaways for employees:

Understand your entitlements regarding reasonable notice or payment in lieu of notice in case of termination without cause.
Keep records of medical reports, communications with your employer, and any evidence supporting your physical or mental limitations or incapacitations.
Communicate openly with your employer about any limitations or health issues which may affect your ability to seek alternate employment.

As employment law continues to evolve, cases such as this serve as important reminders of the importance of fairness, empathy, and equitable treatment in the workplace, especially during challenging transitions like terminations.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

[1] Machtinger v HOJ Industries Ltd, 1992 CanLII 102 (SCC).

[2] Employment Standards Act, 2000, SO 2000, c 41.

[3] Evans v Teamsters Local Union No 31, 2008 SCC 20 (CanLII) at para 97 [Evans], citing S M Waddams, The Law of Damages, loose‑leaf ed (Toronto: Canada Law Book, updated October 2004, release 13) at 15.70; see also: Darbishire v Warran, [1963] 1 WLR 1067 at para 1075, cited by Evans at para 97:

“…it is important to appreciate the true nature of the so-called ‘duty to mitigate the loss’ or ‘duty to minimise the damage.’ The plaintiff is not under any actual obligation to adopt the cheaper method: if he wishes to adopt the more expensive method, he is at liberty to do so and by doing so he commits no wrong against the defendant or anyone else. The true meaning is that the plaintiff is not entitled to charge the defendant by way of damages with any greater sum than that which he reasonably needs to expend for the purpose of making good the loss.”

[4] Krmpotic v Thunder Bay Electronics Limited, 2024 ONCA 332 (CanLII).

[5] Specifically, the Court noted at para 34:

“Mental distress is a broad concept. It includes a diagnosable psychological condition arising from the manner of dismissal but is not limited to that. There is a spectrum along which a person can suffer mental distress as a result of the manner of dismissal. At one end is the person who suffers the normal distress and hurt feelings resulting from dismissal, which are not compensable in damages. At the other end of the spectrum is the person who suffers from a diagnosable psychological condition as a result of the manner of dismissal. In between those two end points, there is a spectrum along which the manner of dismissal has caused mental distress that does not reach the level of a diagnosable psychological injury.”

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What is a Pierringer Agreement?A Pierringer agreement, named after Pierringer v. Hoger et al., 124 N.W. (2d) 106 (Wis. S.C. 1963), the Wisconsin case in which this type of agreement was first considered. Such agreements permit some parties to withdraw from the litigation, leaving the remaining defendants responsible only for the loss they actually caused, with no joint liability. As the non-settling defendants are responsible only for their proportionate share of the loss, a Pierringer agreement can properly be characterized as a “proportionate share settlement agreement” (PSSAs).

Pierringer Agreements in Canada, in contrast to the United States, included additional protections for non-settling defendant(s), such as requiring that non-settling defendant(s) be given access to the settling defendant’s evidence.

Characteristics of a Proportionate Share Settlement Agreement (PSSAs)To the extent that a PSSA completely removes the settling defendant(s) from the legal action, it operates similarly to a conventional settlement agreement that resolves all outstanding issues between the parties involved.

PSSAs typically consist of the following elements:

The plaintiff receives a payment from the settling defendant(s) in full satisfaction of the plaintiff’s claim against them.
In return, the settling defendant(s) receive from the plaintiff a promise to discontinue proceedings, effectively removing them from the suit.
Subsequent amendments to the pleadings formally remove the settling defendant(s) from the suit.
The plaintiff then continues its suit against the non-settling defendants.

Potential Complications with PSSAsThere is, however, an added complication that a PSSA must address. As a result of third-party proceedings, settling defendant(s) are almost always subject to claims for contribution and indemnity from non-settling defendant(s) for the amount of the plaintiff’s loss alleged to be attributable to the fault of the settling defendant(s).

Before the settling defendant(s) can be released from the suit, some provision must be made to satisfy these claims.

What is “Contribution”?When one defendant settles with the plaintiff through a Pierringer agreement, the non-settling defendant(s) may still seek contribution from the settling defendant for any amounts they are required to pay to the plaintiff. Contribution allows defendant(s) who have paid more than their fair share of damages to recover a proportionate amount from other defendant(s) who are also liable.

Therefore, even though the settling defendant(s) has resolved their liability with the plaintiff, they may still be responsible for contributing to the payment of damages if the other defendant(s) are found liable.

What is “Indemnity”?Similarly, a non-settling defendant(s) may also seek indemnity from the settling defendant(s). Indemnity is a legal obligation to compensate for any losses or damages incurred. In this context, if the non-settling defendant(s) is required to pay damages to the plaintiff, they may seek full indemnification from the settling defendant(s) if there was an agreement or legal basis for such indemnification.

This obstacle is overcome by including an indemnity clause in which the plaintiff covenants to indemnify the settling defendant(s) for any portion of the damages that a court may determine to be attributable to their fault and for which the non-settling defendant(s) would otherwise be liable due to the principle of joint and several liability.

Alternatively, the plaintiff may covenant not to pursue the non-settling defendant(s) for that portion of the liability that a court may determine to be attributable to the fault of the settling defendant(s).

As for any concern that the non-settling defendant(s) will be required to pay more than their share of damages, it is inherent in Pierringer agreements that non-settling defendant(s) can only be held liable for their share of the damages and are severally, and not jointly, liable with the settling defendant(s).

Crossclaims That Go “Beyond Contribution And Indemnity”In instances where a defendant’s crossclaim expands beyond merely seeking contribution and indemnity for the plaintiff’s allegations of negligence, particularly when grounded in contractual agreements between defendants, the plaintiff’s restriction of its claim to the defendant’s individual liability does not invalidate the crossclaim. This means that even if the plaintiff narrows its focus to the defendant’s individual responsibility, the crossclaim remains relevant and must be addressed with the participation of all relevant parties during trial.

Consequently, Courts have consistently opted not to dismiss crossclaims that exceed the scope of negligence-based contribution and indemnity, as outlined in Pierringer agreements, recognizing the necessity of comprehensive participation in resolving such complex legal matters.[1]

This was the case in Laidler v. The Office of the Public Guardian and Trustee, 2015 ONSC 943, where a legal action was initiated to seek damages related to the purchase of land allegedly contaminated. The lawsuit targeted the property vendors, the involved real estate agents, and their respective brokerages. Subsequently, the real estate agents and their brokerages entered a Pierringer agreement with the plaintiffs. However, one of the non-settling defendants chose to uphold their crossclaim against a settling defendant (the vendor’s former agent and listing broker), alleging negligence and breach of contract.

Although the Court acknowledged that the vendors could not sustain crossclaims against the settling defendants solely based on contributory negligence, it determined that it remained within the trial judge’s purview to decide whether the vendors were eligible for indemnification for all or part of the damages they might be required to pay to the plaintiffs. Consequently, the Court opted not to dismiss the crossclaim.

ConclusionPierringer or proportionate share agreements remain widely recognized by the courts as valuable tools for fostering settlement in multi-party litigation. While these agreements afford a means for a settling defendant to withdraw from the litigation, non-settling defendants may still retain the right to pursue avenues for recovery, such as contribution or indemnification. However, the viability of such claims depends on various factors, including the specific circumstances of the case and any existing contractual arrangements.

In essence, while Pierringer agreements streamline dispute resolution, they do not offer blanket immunity against further legal action.

For more information, assistance, or any other questions regarding Pierringer agreements and proportionate share settlement agreements, please contact Kelli Preston at Devry Smith Frank LLP at (416) 446-3344 or at kelli.preston@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

This blog was co-authored by Articling Student, Owais Hashmi.

[1] 1511233 Ontario Inc v. Spallino, 2024 ONSC 2045 (CanLII), at para 17.

The post A PSA on PSSAs: Ramifications of a Pierringer Agreement in the Face of a Crossclaim for Contribution and Indemnity first appeared on Devry Smith Frank LLP.

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The COVID-19 pandemic severely impacted workplaces across Canada. Employers in Ontario have continued to grapple with the ongoing challenge of safeguarding their employees’ health while maintaining continuity of operations. Many employers imposed mandatory vaccination policies as a means of mitigating the spread of the virus within their organizations.

Background: Caselaw Update: Reasonableness and Enforceability of Mandatory COVID-19 Vaccination Policies in the Workplace
Further Background: Employees Must Disclose Vaccination Status where an Enforceable Vaccination Mandate Exists, but Employers are Cautioned to Protect Employee Privacy

An employment contract may be frustrated by the mandatory vaccination policy of a third-party as a recent decision of the Ontario Court of Appeal illustrates.

Frustration arises where unforeseen circumstances emerge which were not contemplated by the employment contract, causing the performance of the contract to become significantly different from what was originally agreed upon.[1] As a result, it has become impossible to perform the original contract.[2] In such a case, the employment contract is terminated on a “no fault” basis; releasing both the employer and the employee from any further obligation to perform.[3]

Croke v VuPoint System Ltd, 2024 ONCA 354[4]VuPoint System Ltd. provides installation services for residential consumer television and internet services — almost entirely for Bell Canada. In fact, at the material time, VuPoint’s contracts with Bell Canada accounted for more than 99% of its business. Alan Croke was employed as a technician for VuPoint.

In 2021, Bell implemented a mandatory vaccination policy requiring of VuPoint that all of its technicians working on Bell projects must be vaccinated against COVID-19. Thus, VuPoint instituted its own mandatory vaccination policy for its employees, including Mr. Croke.

Mr. Croke refused to disclose his vaccination status to VuPoint. Consequentially, he was terminated by way of frustration of contract. Mr. Croke brought an action for wrongful dismissal against VuPoint, but the action was dismissed on summary judgment.

On appeal, the Court upheld the motion judge’s finding that the contract was frustrated. The introduction by Bell of a mandatory vaccination policy amounted to the introduction of a new external requirement upon Mr. Croke which he did not satisfy; i.e., the new policy was the “supervening event.”

As a result of the supervening event, performance of the employment contract became something radically different than what the parties had contracted for — given that Mr. Croke was no longer qualified to undertake the work for which he was hired. That change was not foreseeable when the contract was formed between Mr. Croke and VuPoint. The supervening event was something for which VuPoint had neither control nor advance warning.

Although Mr. Croke argued that he was actually terminated for the cause of refusing to comply with the new requirement, the Court held that frustration did not turn on voluntariness. The Court specifically addressed and dismissed the notion that “a contract is not frustrated if the supervening event results from a voluntary act of one of the parties.”[5] While it is true that Mr. Croke voluntarily chose not to adhere to the mandatory vaccination policy, his decision did not constitute the supervening event itself. Instead, it was the implementation of the policy that served as the supervening event. Consequently, the contract was frustrated regardless of Mr. Croke’s subsequent actions in response to the policy.

The termination by way of frustration was valid based on the unforeseeable radical alteration of the contract, and despite being well aware of the policy, Mr. Croke failed to disclose his vaccination status to VuPoint.

ConclusionCroke v VuPoint System Ltd demonstrates that the unexpected imposition of a third party’s mandatory vaccination policy can significantly change the contractual obligations of the parties involved, justifying an employer’s termination of the employment contract due to frustration.

Although in this case, it was VuPoint’s own mandatory vaccination policy that affected Mr. Croke, this requirement was implemented in response to a direct mandate from the client, which constituted the vast majority of its business. It remains to be seen how courts will decide cases where the employer itself has full control over the vaccination policies they introduce by their own sole intention and not as a result of some outside force.

The legal landscape regarding mandatory COVID-19 vaccination policies in the workplace continues to evolve. Employers face the challenge of balancing employee health and safety with operational needs, often resorting to mandatory vaccination policies to mitigate the spread of the virus.

Further takeaways:

Employers and employees should understand the distinction between frustration of contract and termination with or without cause.
Employers must ensure that mandatory vaccination policies comply with relevant laws, regulations, and contractual obligations, while respecting employees’ rights.
Employers should communicate vaccination policies transparently, including the rationale behind them, consequences for non-compliance, and available avenues for seeking accommodations or alternatives.
Employees should actively seek clarification on vaccination policies, understand their rights and options, and consider compliance with policy requirements to mitigate potential repercussions.

By proactively addressing legal and ethical considerations, employers can foster a safe and inclusive work environment, while employees can make informed decisions to safeguard their well-being and rights in the workplace.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

[1] Naylor Group Inc v Ellis-Don Construction Ltd, 2001 SCC 58 (CanLII) at para 53, citing Peter Kiewit Sons’ Co v Eakins Construction Ltd., 1960 CanLII 37 (SCC) at 368, citing Davis Contractors Ltd v Fareham Urban District Council, [1956] AC 696 (HL), at 729.

[2] GHL Fridman, The Law of Contract in Canada, 4th ed (Scarborough: Carswell, 1999) at 677.

[3] John D McCamus, The Law of Contracts, 3rd ed (Toronto: Irwin Books, 2020) at 656.

[4] Croke v VuPoint System Ltd, 2024 ONCA 354 (CanLII).

[5] Fram Elgin Mills 90 Inc v Romandale Farms Limited, 2021 ONCA 201 (CanLII) at para 230.

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OverviewIn 2730453 Ont Inc. v 2380673 Ont Inc., 2022 ONSC 6660, the plaintiff, 2730453 Ontario Inc. (the “Purchaser”), sought specific performance to enforce an oral agreement for the purchase of land. The defendant, 2380673 Ont. Inc. (the “Vendor”), was the seller and owner of the property in question, who had initially agreed to the terms but later attempted to back out of the deal.

FactsThe Purchaser was represented by a project-specific company established specifically to acquire the disputed land. The Vendor was a corporation led by a sole individual. Over several months, negotiations were conducted through intermediaries for the sale and purchase of the Vendor’s 32-acre property, which directly adjoined land already owned by the Purchaser. The Purchaser’s objective was to consolidate land for future industrial development.

These negotiations eventually led to the Purchaser making an offer, which the Vendor seemingly accepted and provided some necessary documentation for the closing process. Notably, the Vendor had a unique preference, which the Purchaser accommodated, regarding the postponement of formalizing the deal in writing until just prior to the closing date. Consequently, beyond initial drafts and exchanged documents, there existed no finalized, signed agreement encapsulating all agreed-upon terms.

Despite this absence of a formalized contract, the Purchaser continued preparations for the transaction, affirming their readiness to proceed with funding and tendering. However, the Vendor raised unforeseen objections at the brink of the scheduled closing, conveyed via a 4 a.m. email to their agent. The email stated: “There will be no closing.”

The Vendor refused to move forward with the transaction, relying upon section 4 of the Statute of Frauds, RSO 1990, c S.19, which states that a contract for the sale of land must be in writing.

The Purchaser subsequently brought an action against the Vendor for beaching the agreement and sought specific performance for the property. Specific performance is a declaration by the court compelling a party to perform its contractual obligations. In the context of real estate, specific performance is typically granted when the prevailing party proves the property’s uniqueness, indicating that a substitute is not readily available and that monetary damages would be insufficient to remedy the harm suffered by the innocent party.

AnalysisNature of the PropertyThe Purchaser relied upon an expert report from a land use planner, which concluded that the disputed land was unique due to a number of features, such as:

it is situated within Protected Future Employment Land;
it has extensive visibility and exposure from Highway 407;
it is in very close proximity to the future 407 Transitway;
it has proximity to access to ON-403 and ON-407 Expressways Via Trafalgar Rd Interchange;
it has contiguity to the adjacent westerly property owned by 2730453 Ontario Inc.; and
it facilitates improved opportunity to master plan an employment/business Park.

In this instance, the court concluded that the contested property possessed uniqueness due to its immediate adjacency to the Purchaser’s property, with the Purchaser intending to develop both lots as part of a unified development. Given that other adjacent properties were not available for sale at the time, the contested property was deemed ‘unique’ as there was no suitable substitute available.

Part PerformanceDespite the absence of a written contract, the court found that the following acts constituted part performance of the oral agreement by the Purchaser:

obtaining an environmental assessment of the property;
obtaining survey and title searches on the property;
conducting other due diligence related to the property;
negotiating and preparing the commission agreement among the purchaser and the brokers;
retaining legal counsel to close the agreement;
drafting, revising, and negotiating the written agreement of purchase and sale for the property;
delivering the documents required on closing; and
obtaining, delivering and tendering the certified cheque for the full amount of the purchase price.

Furthermore, the court determined that the Vendor’s following actions related to the sale of the disputed property and constituted part performance of the oral contract:

retaining legal counsel to close the agreement for the purchase and sale of the property;
negotiating over the status of the easement on the property;
reviewing and revising the draft agreement of purchase and sale, including providing a revised version of Schedule A to that agreement to the purchaser and obtaining the consent of the purchaser to the revisions;
providing draft copies of the vendor’s closing certificate and statutory declaration and the owner executing those documents; and
negotiating the method by which the purchaser would deliver the agreed-upon purchase price on closing.

ConclusionThe court ultimately found that there was sufficient written evidence to prove the existence of an oral agreement, supported by numerous acts of part performance. Through correspondence, all the essential terms of the deal were agreed to, which included:

the identity of the parties;
the description of the property; and
the purchase price.

Having concluded that there was a valid oral agreement breached by the Vendor without justification, the court then turned its attention to the appropriate remedy. Given the inadequacy of damages, particularly in light of the Purchaser’s future development goals which would be challenging to quantify, the court deemed specific performance to be the more suitable recourse.

For more information, assistance, or any other questions regarding real estate litigation, or real estate transactions, please contact Kelli Preston at Devry Smith Frank LLP at (416) 446-3344 or at kelli.preston@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

This blog was co-authored by Articling Student, Owais Hashmi.

The post ONSC Enforces Oral Agreement for Purchase and Sale of Real Estate Property, Grants Specific Performance Remedy to Purchaser first appeared on Devry Smith Frank LLP.

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Insurance policies protect our various interests such as our homes, vehicles, and personal property where there is potential damage, loss, and/or liability. Insurance policies vary and are available to purchase at different prices and different levels of coverage. Insurance is often a necessary condition for acquiring a variety of things, such as owning a vehicle or obtaining a mortgage.

In the context of a condominium and pursuant to Ontario’s Condominium Act, individual unit owners are subject to the rules of their condominium’s declaration and bylaws, which together make up the governing documents.[1]

How are condominiums operated and organized? Essentially, all condominiums have a corporation number which creates the condominium corporation. The condominium corporation is a legal entity. A condominium corporation will designate a Board of Directors to make major decisions, such as what renovations should be made to common elements and managing the flow of money in and out of the condominium’s reserve fund.

A condominium corporation is created by filing, among other things, a declaration to the Land Registry Office. A unit owner must abide by the declaration, which will set out a list of rules, including rules for insurance.

Ontario’s Condominium Act requires that a condominium corporation obtain insurance on its own behalf and on behalf of the owners for damage to the units and common elements that is caused by major perils or the other perils that the declaration or the by-laws specify.[2]

Major perils covered by a condominium corporation’s insurance include fire, lightning, smoke, windstorm, hail, explosion, water escape, strikes, riots or civil commotion, impact by aircraft or vehicles, vandalism or malicious acts.[3] Oftentimes, condominium corporations will get “all risk” insurance policies that are usually more comprehensive and suitable for the purposes of the Condominium Act.

Although the province of Ontario does not require individual unit owners to purchase an insurance policy, unit owners may nevertheless be required to do so pursuant to the condominium’s governing documents to cover for things such as improvements to their units or personal property.

What is subrogation? Subrogation is a legal concept that allows one party, typically an insurance company, to step into the shoes of another party and seek reimbursement or recovery for a loss or damages they have already paid. It commonly occurs when an insurer compensates its policyholder for a covered loss and then seeks to recover the amount paid from a third party who may be responsible for causing the loss.

By exercising the right of subrogation, the insurance company essentially assumes the legal rights of its policyholder to pursue a claim against the responsible party, aiming to recoup the expenses it has incurred. This principle helps prevent the policyholder from benefiting twice for the same loss and promotes fairness and cost-sharing among parties involved in an incident or accident.

It is important to note that the insurer cannot subrogate against its own insured.

How do subrogated claims apply to condominiums? A condominium corporation would likely contain a provision in their governing documents which imposes an obligation on all unit owners to purchase their own insurance policies for their units that would exist separately from the condominium corporation’s all-risk insurance policy. This provision would contain a mandatory condition barring any claim of subrogation between its corporation, employees, agents, unit owners, and other stakeholders. This is called a waiver of subrogation.

This means that in the event a unit owner suffers from damages to its property from a source beyond itself but within the same building, and after receiving coverage for the damages, that unit owner’s own insurance company cannot make a claim of subrogation against the insured’s neighbours or the condominium corporation if there is a waiver of subrogation requirement in the condominium’s governing documents, subject to exceptions provided for in the documents.

Another way of understanding the waiver of subrogation rights is to consider it an “allocation of risk between the condominium corporation (which assumes responsibilities for insuring the building), and the owner of the unit (which is responsible for insuring the contents/equipment of the unit). The intention in allocating those risks is that there will not be subrogation between the two parties for a loss to the other’s property even if caused by the negligence of the other party.”[4]

ConclusionIn conclusion, insurance plays a crucial role in safeguarding our interests, whether it’s our homes, vehicles, or personal property, from potential risks and liabilities. In the realm of condominium living, understanding the organization and operation of condominium corporations is paramount.

In essence, the purpose of insurance and subrogation mechanisms are to mitigate risks and promote financial security in condominium living. By adhering to these principles, both condominium corporations and unit owners can navigate potential challenges with confidence.

If you have questions about property-related litigation or title insurance, please contact Graeme R. Oddy, lawyer at Devry Smith Frank LLP at 416-446-5810 or Graeme.oddy@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

This blog was co-authored by Articling Student, Toni Pascale, and Summer Law Student, Sanaz Sakhapour.

[1] Condominium Act, 1998, S.O. 1998, c. 19

[2] Ibid at s. 99.

[3] Ibid at s. 99(2).

[4] Elite Vertical Blinds, Mfg. Co. v. YRCC No. 696, 2018 ONSC 1000 (CanLII) at para 25.

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The rights of minority shareholders are frequently in conflict with those of majority shareholders and directors. One case that delves into this closely is Wilfred v Dare, 2018 which examines the concept of reasonable expectation of liquidity and its intersection with the law of oppression and corporations.

The case revolves around Carolyn Dare, a minority shareholder in Serad Holdings Limited, a family-owned business. Carolyn argued that her inability to sell her shares due to the lack of a third-party market amounted to oppression, which raised questions about the fair treatment of minority shareholders and the responsibilities of those in control of the corporation.

The court’s analysis in Wilfred v Dare provides important insights into the concept of reasonable expectation of liquidity. It considered various factors, including the capital needs of the family business and the lack of a third-party market for the shares, Carolyn’s financial difficulties – which were not caused by her brothers – and the fact that she had received her interest in Serad Holdings Limited as a gift as part of an estate freeze.

This demonstrates that the law of oppression requires courts to balance the interests of minority shareholders with the legitimate business interests of the corporation. While minority shareholders are entitled to fair treatment and protection from oppressive conduct, they must also consider the broader context of the corporation’s operations and the impact of their actions on the business as a whole.

Key Regulations In this case, the court decided that simply not being able to sell shares wasn’t enough to be considered oppression. To understand why, it’s important to look at the basic principles and how they apply in situations like this:

Reasonable Expectation of Liquidity: The court evaluated whether Carolyn could reasonably expect to sell her shares. This assessment considered factors like the company’s financial needs, her understanding at the time she acquired the shares, whether there were other ways for her to get value from her shares, and how she got her shares in the first place.

Oppression and Fair Treatment: The law of oppression aims to protect minority shareholders from unfair treatment by the majority. The court must balance the rights of minority shareholders with the company’s legitimate interests. In the Wilfred case, the court emphasized that the oppression remedy doesn’t entitle a shareholder to avoid restrictions on the liquidity of their shares unless there is clear evidence of unfair or oppressive behaviour.

Establishing Oppression: To prove oppression, a shareholder must show that they have been treated unfairly or ignored. This requires presenting evidence of a consistent pattern of behaviour or actions that unfairly disadvantage the minority shareholder.

These principles highlight the complexity of oppression claims and the need for a thorough understanding of the facts and circumstances of each case. They also emphasize the importance of balancing the rights of minority shareholders with the legitimate business interests of the corporation in applying the law of oppression.

Successor cases, such as Noble v. North Halton Golf, 2018 and Corber v. Henry, 2023 reaffirmed the findings in Wilfred v Dare. They emphasized that the oppression remedy is not designed to relieve a minority shareholder from the limited liquidity attached to their shares or to provide a means of exiting the corporation, in the absence of any oppressive or unfair conduct.

Individuals in a similar situation should be aware of these principles. Understanding the aspects of liquidity expectations, oppression, and fair treatment is crucial for protecting minority shareholder rights and ensuring fair corporate governance practices. When faced with issues related to reasonable expectations of liquidity, seeking legal advice and understanding one’s rights as a shareholder are essential steps in navigating these complex legal matters.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

The post Minority Shareholder Rights Conflicts: Insights from Wilfred v. Dare first appeared on Devry Smith Frank LLP.

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In a recent appeal before the Ontario Court of Appeal, the Court showcased once again the significance of the “time is of the essence” clause. In, 3 Gill Homes Inc. v. 5009796 Ontario Inc. (Kassar Homes), 2024 ONCA 6, the parties entered into an Agreement of Purchase and Sale (APS) with 3:00 pm being the closing time specified on the completion date. The purchasing party missed the closing time by a mere 35 minutes and despite having delivered the purchase price, the Vendor terminated the contract. The appellant, 3 Gill Homes Inc., contested the application judge’s ruling in favour of the respondent vendor, 5009796 Ontario Inc., trading as Kassar Homes (“Kassar Homes”). In rendering its decision the Ontario Court of Appeal had to balance well-established rules of contractual interpretation and strict reading of the contract negotiated and entered into by the parties.

Key Issues

Did the application judge err in finding that:
1. the payment closing time was 3:00 pm;
2. time was of the essence in relation to the payment closing time;
3. the 3:00 pm closing time was not unconscionable;
4. damages could not be fairly determined on a written record; and
Are the application judge’s reasons sufficient for appellate review?

Court’s Decision

The Court of Appeal dismissed the appeal, upholding the application judge’s ruling. Here’s the breakdown of the court’s reasoning:

Payment Deadline: The court affirmed the application judge’s determination that the payment deadline of 3:00 p.m. was clearly stipulated in the APS. This timeframe was essential, and failure to adhere to it justified the vendor’s termination of the contract.
“Time is of the Essence” Clause: The court agreed with the application judge’s interpretation of the “time is of the essence” clause. This clause made it clear that adhering to the closing date and time was crucial, empowering the innocent party to terminate the contract upon breach.
Unconscionability: The court found no basis to interfere with the application judge’s conclusion regarding the absence of unconscionability. The parties’ familiarity with real estate transactions and the terms of the APS weighed against the appellant’s claim of unfairness.
Sufficiency of Reasons: The court determined that the application judge’s reasons were adequate for appellate review. The judge’s analysis of relevant case law, the APS terms, and factual circumstances provided a clear rationale for the decision.
Damages Determination: Since the court upheld the application judge’s ruling on the merits, it deemed the issue of damages determination unnecessary for consideration.

Opinion

Many commentators would describe the Ontario Court of Appeal’s decision as harsh, given the fact that the Purchaser missed the closing payment deadline by a mere 35 minutes.

This case underscores the significance of honouring contractual agreements in real estate transactions. The court’s decision not to interfere with the contractual deadline reflects a commitment to upholding the parties’ bargained-for terms. In essence, if parties agree that funds must be provided by a specific time, irrespective of other deadlines, the court will honour that agreement.

In this instance, the vendor was within their rights to terminate the contract when the funds were not deposited into their lawyer’s trust account by 3:00 p.m., as specified in the APS. It is a common practice for such clauses to be included in pre-construction agreements. Upon entering into an APS, purchasers would do well to insert a solicitor review condition to ensure they are advised of all contractual timelines. While the transfer deed, the document in which ownership is transferred from vendor to purchaser, can occur on or prior to 5:00 pm, the parties could insert additional timelines for certain deliveries in the APS.

Conclusion

The Ontario Court of Appeal’s decision in 3 Gill Homes Inc. v. 5009796 Ontario Inc. (Kassar Homes), 2024 ONCA 6 reaffirms the importance of respecting contractual obligations in real estate transactions. By upholding the parties’ bargained-for terms, the court ensures clarity and fairness in contractual dealings. This case serves as a reminder for parties to carefully review and negotiate their agreements to avoid disputes over contractual deadlines in the future.

If you have questions about real estate transactions, please contact Louis Gasbarre, lawyer at Devry Smith Frank LLP at 416-446-5853 or louis.gasbarre@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

This blog was co-authored by Mohadeseh Bakhtiari.

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A change in 2018 that now allows a maximum penalty of 10 years imprisonment for impaired driving has impacted the eligibility of those who have been convicted of an impaired driving charge and are seeking or have permanent resident status in Canada.

In 2018, Bill C-46 became law and cracked down on drivers under the influence. This change means that an impaired driving charge may now result in 10 years imprisonment. This has had a significant impact on those seeking, and those who have obtained permanent resident status in Canada.

The Immigration and Refugee Protection Act (“IRPA”) lays out the inadmissible conduct that falls under “serious criminality”. Section 36(1) reads as follows:

36 (1) A permanent resident or a foreign national is inadmissible on grounds of serious criminality for

(a) having been convicted in Canada of an offence under an Act of Parliament punishable by a maximum term of imprisonment of at least 10 years, or of an offence under an Act of Parliament for which a term of imprisonment of more than six months has been imposed;

(b) having been convicted of an offence outside Canada that, if committed in Canada, would constitute an offence under an Act of Parliament punishable by a maximum term of imprisonment of at least 10 years; or

(c) committing an act outside Canada that is an offence in the place where it was committed and that, if committed in Canada, would constitute an offence under an Act of Parliament punishable by a maximum term of imprisonment of at least 10 years.

As laid out above, there are a number of offences under this section of IRPA that would deem an individual “inadmissible” to Canada. With the changes that came into force with Bill C-46, impaired driving is now one of them. The result is that it does not matter whether you were sentenced to the maximum penalty. If you were convicted of an act that is punishable by a maximum term of imprisonment of at least 10 years, you are inadmissible to Canada on grounds of serious criminality.

For foreign nationals seeking entry into Canada, the repercussion of being deemed inadmissible means that they would likely be refused entry into Canada even for a short visit. For permanent residents of Canada, being deemed inadmissible means that they may lose their permanent resident status and are at risk of facing deportation. Whether convicted of a DUI in Canada or another country, the risk remains the same.

After a DUI conviction, Canada Border Services Agency (“CBSA”) will notify the offender that the offence is considered a “serious criminality” offence. The offender would then have an opportunity to respond and CBSA would determine whether or not to prepare a Section 44 report to commence the deportation process and hold an admissibility hearing. The admissibility hearing is held before the Immigration Division of the Immigration and Refugee Board of Canada (IRB). This hearing is to determine whether CBSA was correct in labelling the offender as someone who meets the definition of “Serious Criminality” under the Act. If the Board determines that the offender meets the “Serious Criminality” definition, the offender is now inadmissible to Canada, and the Board will issue a removal order. It is important to note that there is no appeal option for permanent resident DUI offenders who were sentenced to 6 months or more of prison time.

It is imperative that permanent residents of Canada fully understand the immigration repercussions of a DUI conviction before entering a guilty plea to a DUI charge. Criminal lawyers will often wisely advise their client to plead guilty (often when presented with multiple charges being dropped in exchange for a guilty plea to the DUI), but without fully considering or understanding the effect this will have on their client’s permanent resident status in Canada.

If you are currently a permanent resident in Canada and have been charged with impaired driving, or are seeking permanent resident status in Canada, you may have options. If this is the case, an experienced lawyer, knowledgeable in the complex intricacies of Canadian immigration law, is essential in solving your immigration needs. If you are interested in seeking further guidance on this topic, please contact Benjamin Grubner, immigration lawyer at Devry Smith Frank LLP at 416-446-3328 or Benjamin.grubner@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

This blog was co-authored by articling student Samantha Lawr.

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In an effort to modernize estate law practice, several amendments to Ontario’s inheritance laws have recently been implemented. These changes were largely prompted by the enactment of the Accelerating Access to Justice Act, 2021, which introduced significant amendments to the Succession Law Reform Act (“SLRA”), the legislation governing inheritance matters in Ontario.

Traditionally, under intestacy rules, if a married couple lived separately and one died without a will, leaving behind only a spouse, the spouse would inherit the deceased’s property outright. However, if the deceased left a spouse and one child, the spouse’s entitlement would be half of the estate remaining after the payment of the spousal preferential share, currently set at $350,000. In cases with multiple children, the spouse would still receive their preferential share, with the remaining estate divided between the spouse and the deceased’s children.

However, on January 1, 2022, an amendment to section 43.1 of the SLRA introduced significant changes regarding separated spouses in intestacy matters. This amendment not only exempts separated spouses from intestacy rules but also provides a comprehensive definition of what constitutes a “separated” spouse. The aim is to bring clarity and fairness to estate distribution in situations where marital relationships have broken down.

Who qualifies as a “spouse” under the SLRA?Under the SLRA, “spouse” has the same meaning as in section 1 of the Family Law Act (“FLA”).

Section 1 of the FLA defines “spouse” as two persons who:

(a) are married to each other, or

(b) have together entered into a marriage that is voidable or void, in good faith on the part of a person relying on this clause to assert any right.

According to section 43.1 of the SLRA, a spouse is considered “separated” from the deceased person at the time of their death if:

(a) Before the person’s death,

i. they lived separate and apart as a result of the breakdown of their marriage for a period of three years, if the period immediately preceded the death,

ii. they entered into an agreement that is a valid separation agreement under Part IV of the Family Law Act,

iii. a court made an order with respect to their rights and obligations in the settlement of their affairs arising from the breakdown of their marriage, or

iv. a family arbitration award was made under the Arbitration Act, 1991with respect to their rights and obligations in the settlement of their affairs arising from the breakdown of their marriage; and

(b) at the time of the person’s death, they were living separate and apart as a result of the breakdown of their marriage.

It’s essential to note the difference between common-law spouses and married spouses regarding property rights. Unlike married spouses, common-law partners do not have the same legal treatment and do not automatically possess equivalent property rights.

By providing clarity on the treatment of separated spouses in intestacy cases and defining the term “separated” spouse, the amendment aims to promote fairness and equity in estate distribution practices. However, it also underscores the ongoing need for individuals to be aware of their legal rights and obligations, particularly in the realm of family law and estate planning.

The experienced legal team at Devry Smith Frank LLP is here to assist you in navigating the intricacies of Ontario’s legal landscape. For more information regarding Estates and Estates-related topics, please contact Kelli Preston at Devry Smith Frank LLP at (416) 446-3344 or kelli.preston@devrylaw.ca.

This post was co-authored by Kelli Preston and Articling Student, Owais Hashmi.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

The post Can I Inherit My Spouse’s Estate if They Died Without a Will While We Were Separated? first appeared on Devry Smith Frank LLP.

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You just moved into your new property. You go to install a new fence, and you discover that it’s not on the property line – 6 inches of your land has been on your neighbor’s side of the fence for years! Uh oh… now what?

Title insurance might save the day!

What is Title Insurance?Title insurance is a type of insurance policy that protects property owners and lenders from losses associated with title issues or other covered risks. “Title” describes your legal right of ownership to the land. Effectively, title insurance allows purchasers to insure against future potential title issues, rather than conducting additional due diligence at the outset of the transaction. Title insurance requires one-time payment, with the policy being effective for as long as you own the property.

Common Coverage Offered by Title InsuranceThe following is a non-exhaustive list of potential issues that a standard title insurance policy may cover:

Title defects
Unmarketability of title
Legal issues involving access
Encroachment issues, adverse possession, property line disputes
Easements over the property (i.e. Someone has a legal right of way over the property)
Liens or charges on title
Work orders from a municipality
Tax or utility arrears from previous owner
Certain violations of municipal regulations
Title fraud or forgery

Title insurance policies also usually contain a litigation provision in which the insurer undertakes to defend your title and other insured risks in any court case that is based on the provisions in your policy. For example, if a neighbour was to build a structure that encroached onto your land, if covered under the policy, the title insurer may assist in retaining counsel on your behalf, commencing a proceeding, and may pay for all legal fees and expenses incurred to rectify the issue.

What is Not Covered?Title insurance policies often contain numerous exemptions or restrictions that are not typically afforded under a standard policy. Some title insurers will provide additional endorsements, depending on the circumstances at hand, to meet your specific needs. If title insurance does not insure over an issue, you will need to speak with your lawyer for further direction on how to proceed. The following is a non-exhaustive list of issues that are not usually covered by a standard title insurance policy:

Physical and structural defects to the property
Certain governmental powers/intervention (i.e. expropriation, violation of by-law etc.)
Environmental risks
Risks that are created by, allowed by, known to, or agreed to by the insured

A common area of confusion lies in the distinction between title insurance and home insurance. While home insurance protects an insured from unexpected loss or damage to the physical property, title insurance protects the insured from loss or defects relating to the legal title of the property. It is imperative to note that title insurance is not an alternative to home insurance.

Is Title Insurance Mandatory?It is not mandatory to purchase title insurance when acquiring a property in Ontario. Nevertheless, a lender may refuse to provide financing if a title insurance policy is not taken out on their behalf (i.e. a lender policy).

The most common alternative to title insurance is to obtain a solicitor’s opinion on title. This alternative requires your lawyer to conduct numerous “off-title” searches that can be costly and time consuming. You would also need to provide your lawyer with, or obtain, an up-to-date survey of the property. The cost to obtain an up-to-date survey alone would likely exceed the cost of a standard title insurance policy, which is why many mortgagors opt to obtain title insurance. Furthermore, the only recourse that a purchaser may have in relation to a missed title defect would be against the lawyer who provided the opinion, which may be further limited given the circumstances and conduct of the parties. Given the potential liability for giving a solicitor’s opinion on title, many lawyers refuse to act on transactions that are not title insured.

Working with your LawyerWhile title insurance may provide coverage for certain losses, it is not an alternative to retaining a lawyer on your transaction, and there is no replacement for sound legal advice and competent representation. Title insurance and lawyers work in conjunction to provide maximum protection to homeowners. For example, if you do find yourself needing to commence litigation against a neighbor, it is often worth first checking if your issue is covered by title insurance.

If you have questions about property-related litigation or title insurance, please contact Graeme R. Oddy, lawyer at Devry Smith Frank LLP at 416-446-5810 or Graeme.oddy@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

This blog was co-authored by Articling Student Jaimin Panesar*

The post Title Insurance 101 first appeared on Devry Smith Frank LLP.

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If you find yourself in a situation where your ex-spouse has experienced a substantial increase in income since the time of your separation, you may be wondering whether you are entitled to a reassessment of spousal support.

What is Spousal Support? Spousal support is financial assistance that one spouse may be required to pay to the other spouse after a separation or divorce, ensuring the recipient’s financial stability. Spousal support is usually paid on a monthly basis; however, it can also be paid as a lump sum.

According to section 15.2 of the Divorce Act and further discussed in the Supreme Court of Canada case, Bracklow v. Bracklow, there are three reasons a spouse would be entitled to spousal support:

Compensatory spousal support, which is meant to compensate the lower-income earning spouse for sacrifices and contributions made during the marriage;
Non-compensatory spousal support, which is meant to allow the recipient spouse to enjoy a similar lifestyle as they did while married; and,
Contractual.

In determining whether to award spousal support, a judge must consider many factors, including:

The parties’ financial situations;
The length of time the spouses cohabited;
The roles of each spouse during the marriage;
The impact of the breakdown of the marriage on each party’s financial situation;
The ongoing responsibilities for the care of children; and,
Any previous arrangements made regarding spousal support.

The Spousal Support Advisory Guidelines provide parties and the Court with some guidance in determining the quantum and duration of when calculating reasonable spousal support. It is important to remember, however, that the Court retains discretion and the Guidelines are advisory only – they are not law.

Are you entitled to increased spousal support if your former partner’s income increases? If one party experiences a significant change in their income after a spousal support arrangement has been made, it may constitute grounds for seeking a variation in spousal support, and the receiving party may be eligible for a reassessment of spousal support amounts.

Whether you are entitled to an increase in spousal support if your former partner’s income increases is largely discretionary and is dependent on the circumstances and basis of the entitlement to spousal support. A spousal support order would not change automatically, and it is the responsibility of the recipient spouse to apply to vary the order.

According to section 17(4.1) of the Divorce Act, before the court varies a spousal support order, it must be satisfied that a change in the condition, means, needs, or other circumstances of either former spouse has occurred since the making of the spousal support order. For example, since non-compensatory spousal support is intended to allow the lower-income earning spouse to enjoy a similar lifestyle as they did while married, an increase in income would usually not be relevant. A recipient’s entitlement to post-separation increases in income is more likely to be found in cases of compensatory support.

Chapter 14.3 of the Spousal Support Advisory Guidelines discusses that “a rough notion” of causation is applied to post-separation income increases for the payor when determining if the income increase should impact spousal support entitlements. As such, it will depend on the length of the marriage, the roles adopted during the marriage, the time elapsed between the date of separation and the income increase, and the reason for the income increase.

The likelihood of full or substantial sharing becomes more likely with child support cases, given the fact that there is a strong compensatory nature of the claim. If there is no child support in question, the Court will consider the following:

long traditional marriages;
medium-length and longer marriages;
strong compensatory claims where there is primary responsibility for child-rearing;
strong compensatory claims in longer marriages;
prior agreements discussing future increases in income;
support/cohabitation while in school;
payor spouse continuing in the same job or area of work post-separation
claims that were impacted by an inability to pay; and,
income increases shortly post-separation.

Varying the Spousal Support OrderIf the payor spouse does not consent to vary the spousal support order, it may be necessary to commence a Motion to Change. If applying for a variation, the applicant must meet the threshold to prove that there is a material change in the circumstances. The material change must be substantial and continuing, and if known at the time of the initial order, would likely have resulted in a different order. Determining what constitutes a material change is up to the court’s discretion.

ConclusionNavigating the complexities of spousal support in the face of a significant increase in your ex-spouse’s income requires a careful understanding of the legal framework due to its highly discretionary nature.

For more information regarding spousal support and/or family law-related topics, please contact Laura Dyke at Devry Smith Frank LLP at (416) 446-3327 or laura.dyke@devrylaw.ca

This blog was co-authored by Articling Student, Toni Pascale.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

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As you embark on a new year filled with possibilities, consider prioritizing resolutions that ensure lasting financial security and peace of mind for you and your loved ones. Take these proactive steps in wealth and estate planning to safeguard your legacy and make certain that your wishes are honoured:

Make or update your WillAssets: Provide a comprehensive inventory of your assets, including real estate, investments, and personal property.

Beneficiaries: Clearly outline who will inherit your assets, specifying individuals or groups of individuals.

Guardians: For parents of minor children, appoint guardians who will provide care and support in your absence.

Executorship: Choose a reliable executor to oversee the distribution of your assets in accordance with your wishes.

Funeral Wishes: Communicate your preferences for funeral arrangements, alleviating the burden on your loved ones during a challenging time.

Charitable Donations: If philanthropy is close to your heart, include provisions for charitable donations in your will.

Powers of AttorneyPOA for Personal Care: Appoint an individual responsible for making determinations regarding your healthcare, nutrition, living arrangements, clothing, hygiene, and safety in the event you lack the capacity to make these decisions independently.

POA for Property: Appoint an individual to manage your financial affairs, covering everything from bill payments and managing debt to handling investments and property transactions in the event you lack the capacity to make these decisions independently.

Managing Assets outside of your Will (not included in your Estate)Life Insurance: Review and update life insurance policies to align with your current financial situation and protect your loved ones. Designate beneficiaries to ensure the life insurance proceeds can be distributed without the need for Probate.

TFSA and RRSPs: Strategically manage Tax-Free Savings Accounts (TFSAs) and Registered Retirement Savings Plans (RRSPs) to maximize tax advantages. Designate beneficiaries to ensure the life insurance proceeds can be distributed without the need for Probate.

Joint Accounts: With a joint bank account comes the right of survivorship. This means that when one of the account owners passes away, the surviving owner will take full ownership of the account. In theory, the bank account will not form part of the deceased’s estate since the surviving owner has full legal title to the account through the right of survivorship.

Joint Tenancy: A joint tenancy creates a right of survivorship, which means that if one party dies, their interest is automatically transferred to the surviving tenant(s).

Digital AssetsSocial Media Accounts: Develop a plan for the management or closure of social media accounts, preserving your digital legacy.

Financial Accounts: Safeguard access information for online financial accounts to facilitate a smooth transition for your loved ones.

Cryptocurrency: Provide clear instructions on how to access and manage cryptocurrency holdings, addressing a frequently overlooked aspect of estate planning.

Password Management: Implement secure password practices and communicate access details to trusted individuals.

Business Succession PlanningSole Proprietorships: If the business is a sole proprietorship, it ceases to operate upon the owner’s death. Develop a comprehensive plan for the seamless transfer of ownership and management responsibilities.

Partnerships: Partnerships may or may not dissolve upon the death of a partner depending on the partnership agreement. Alternatively, a deceased partner’s interest may be transferred to a designated party such as a spouse. It is important to make provisions for transfer of ownership upon the death of a partner to determine whether the business will continue to operate and if so, with whom at its helm.

Corporations and Shareholder Agreements: A Shareholders’ Agreement typically covers crucial business transition matters such as ownership of shares, the transfer or sale of shares, procedures in the event of a shareholder’s death, and the resolution of disputes among shareholders. Ownership of voting and preferred shares for a corporation can become a heavily contested matter if adequate provisions are not made.

Creditor ProtectionTransferring Assets inter-vivos: Explore strategies for transferring assets to spouses or children during your lifetime as a gift to avoid complications with Probate.

Bankruptcy Protection: Bankruptcy protections are afforded to certain assets, such as PRDSPs, RRSPs, RRIFs, and DPSPs. Contribution to these plans over an individual’s lifetime can ensure their family and dependants are guaranteed to receive some amount from their estate, especially if beneficiaries are designated from the outset.

Timing Considerations: Be mindful that contributions to the aforementioned assets (as PRDSPs, RRSPs, RRIFs, and DPSPs) and inter-vivos transfers made within 12 months of declaring bankruptcy may not receive the same level of protection.

By taking these proactive steps and deliberate measures, you can be confident that your loved ones will be well-provided for in the future.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.”

This blog was co-authored by Articling Student, Owais Hashmi.

The post Wealth and Estate Planning Resolutions for the New Year first appeared on Devry Smith Frank LLP.

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Residency Requirements to Maintain Canadian Permanent Resident StatusIf you are seeking to maintain your permanent resident status in Canada, you must meet the residency requirements set by Immigration Refugees and Citizenship Canada (IRCC). As a general rule, to keep your permanent resident status, you must have been in Canada for at least 730 days over the course of the last five (5) year period. It is important to note that these 730 days do not need to be continuous. A permanent resident is generally free to leave and enter Canada at any time with a valid permanent residence card. Most permanent resident cards expire after five years.

There are some exceptions in relation to this residency requirement, as some of the time you spend outside of Canada may count towards your permanent resident status. The following are three exceptions to the permanent residency requirement:

You are sent to work outside of Canada full-time by a Canadian employer with the expectation that you will return and resume your employment in Canada
You accompany your spouse, common-law partner or parent who is a permanent resident and who is sent to work full-time outside Canada by a Canadian employer with the expectation that they will return and resume their employment in Canada.
You live outside of Canada with your spouse, common-law partner or parent who is a Canadian citizen.

If you meet any of the above-noted exceptions, the time spent in a foreign country during these activities may be credited as time spent in Canada, towards the 730-day requirement. These exceptions only apply to maintaining your permanent resident status.

Residency Requirements to Apply for Canadian CitizenshipWhen applying for Canadian citizenship, you must meet distinct residency requirements, in addition to the other eligibility criteria as outlined by Immigration Refugees and Citizenship Canada (IRCC). To meet the residency requirements for citizenship, you must have been physically present in Canada, as a permanent resident, for at least 1095 days in the preceding five (5) years from the date you sign the application.

There are two (2) counting exceptions that may allow for time spent outside of Canada, or time spent in Canada prior to becoming a permanent resident, to be credited toward the 1095-day citizenship requirement. The following exceptions are only applicable to citizenship applications:

You are legally in Canada as a “temporary resident” or a “protected person”
You are outside of Canada as a Crown servant or are accompanying a family member who is a crown servant.

It is important to note that each day spent in Canada as a temporary resident or protected person only counts as one-half day when calculating the number of days for your citizenship application, to a maximum of 365 days. For example, if you were a student legally studying at a Canadian university for 500 days (i.e. a temporary resident), only 250 of those days would be credited as time spent in Canada for your application. Furthermore, if you studied in Canada for 800 days, you would only be credited with 365 days, as this is the maximum number of days that can be credited as a temporary resident or protected person.

Time That Does Not Count Towards Any Residency RequirementsIf you are incarcerated, under a probation order, a paroled inmate, or illegally present in Canada (i.e overstaying your visa), this time will not count towards any of the above-noted residency requirements.

Failing to Meet the Residency Requirements A failure to meet the residency requirements does not automatically result in the loss of your permanent residence status. Even if your permanent resident card expires, you do not lose your status. Permanent resident status can only be lost in certain circumstances, such as voluntarily renouncing your status or having a removal order made against you.

If you wish to maintain your permanent residence status but have not met the residency requirements in the preceding five (5) years, you have the option of waiting to apply until you meet the above-noted criteria. However, during the time that your permanent resident card is expired, it is not advisable to travel outside of Canada. If you are outside of Canada when your permanent resident card expires, you will need to apply for a “Permanent Resident Travel Document”, which may delay your return to Canada. In any event, you must be in Canada to apply for a new PR card.

Likewise, if you are seeking to become a Canadian citizen and have not met the residency requirements in the previous five (5) years, you can simply wait to apply until you have met the 1095-day requirement in the preceding five (5) years from your application date.

An experienced lawyer, knowledgeable in the complex intricacies of Canadian immigration law, is essential in solving your immigration needs. If you are looking to submit an application to Immigration Refugees and Citizenship Canada or are interested in seeking further guidance in US or Canadian immigration law, please contact Benjamin Grubner, lawyer at Devry Smith Frank LLP at 416-446-3328 or at Benjamin.grubner@devrylaw.ca

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

This blog was co-authored by Articling Student Jaimin Panesar*

The post Demystifying the Confusion – Maintaining PR Status in Canada first appeared on Devry Smith Frank LLP.

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In the recent case of Ontario Securities Commission v. Camerlengo Holdings Inc., 2023 ONCA 93, the Ontario Court of Appeal (ONCA) determined that when property is conveyed with a general intent to defraud creditors, the transfer can be contested by subsequent creditors, irrespective of their creditor status at the time of the transaction.

Background

The personal respondents, Fred and Mirella Camerlengo, are spouses who purchased a family home in 1988 as joint tenants. Fred is the sole director and shareholder of the corporate respondent, Camerlengo Holdings Inc. (“HoldCo”).

In February 1996, Fred and his business partner established Gridd Electrical Services Inc. (“Gridd”), an electrical contracting business that operated through various corporations such as HoldCo. Both Fred and his business partner transferred their family homes to their respective spouses without any consideration. The transfers were facilitated by the same lawyer, and on the same day. Following the transfer, Fred continued residing in the family home, which Mirella occasionally mortgaged to support Fred’s business endeavours.

Fred and Mirella allegedly made the transfer due to concerns about Fred’s potential exposure arising from their rapidly expanding electrical services business, which involved undertaking high-risk projects.

In 2011, financial troubles arose for Fred and to address this, Fred obtained a $200,000 loan through Bluestream International Investments Inc. (“Bluestream”).

Bluestream came under scrutiny from the Ontario Securities Commission (OSC) when its business associate was discovered to be engaging in fraudulent activities, including trading without registration, and unlawfully distributing securities in an investment scheme. In 2018, the OSC issued a disgorgement order against Bluestream on behalf of the defrauded investors, leading the OSC to initiate a lawsuit against Fred, Mirella and HoldCo to recover the loan amount.

The OSC challenged the 1996 transfer of Fred’s interest in the family home to Mirella, alleging that the transfer was made fraudulently, with the intent of avoiding future creditors.

Motion to Strike

Fred and Mirella brought a motion to strike the statement of claim on the basis that the OSC’s pleadings did not disclose a reasonable cause of action. The motion was dismissed, except with respect to the claims of fraudulent conveyance.

The motion judge considered section 2 of the Fraudulent Conveyances Act (FCA), which states:

Every conveyance of real property or personal property and every bond, suit, judgment and execution heretofore or hereafter made with intent to defeat, hinder, delay or defraud creditors or others of their just and lawful actions, suits, debts, accounts, damages, penalties or forfeitures are void as against such persons and their assigns.

The motion judge concluded that because Bluestream, and consequently OSC, were not creditors when Fred transferred his interest in the home to Mirella, they did not fall under the category of “creditors or others” per section 2 of the FCA.

Court of Appeal overturns Lower Court Decision

The Court of Appeal (ONCA) overturned the motion judge’s decision, ruling that the law against fraudulent conveyances can still apply to transfers made to avoid potential future debts. Citing IAMGOLD Ltd. v. Rosenfeld, [1998] O.J. No. 4690, the ONCA clarified that a subsequent creditor, one who was not a creditor at the time of the transfer, can challenge the transfer if it was intended to “defraud creditors generally, whether present or future.”

To support the inference of an intention to defraud creditors, the ONCA outlined various “badges of fraud,” such as the debtor’s precarious financial state at the time of the transaction, the existence of family or close relationships between parties, divestment of a substantial portion of assets, and evidence of defeating, hindering, or delaying creditors.

The OSC presented several relevant facts in their plea, which the ONCA found compelling in inferring an intention to defraud creditors:

Fred transferred the property to his wife without consideration;
The transfer occurred after 16 years of joint ownership and 4.5 months after incorporating Gridd with his business partner;
Fred and his business partner used the same lawyer to transfer their family homes to their wives simultaneously;
The transfer coincided with Fred’s concerns about personal liability from his rapidly expanding high-risk electrical contracting business; and
Despite the transfer, Fred continued treating the property as his own.

Based on the above, the ONCA found sufficient grounds to support the inference of an intention to defraud creditors, allowing the OSC’s claim to proceed.

Conclusion

The ONCA’s ruling has significant implications for cases where individuals or entities attempt to shield assets from potential liabilities by transferring them to others (such as spouses and children), and it highlights the importance of considering the broader intent behind such transfers when assessing their validity.

It is important to note that during the oral hearing, the respondents attempted to raise an argument about the statute of limitations. However, since this argument was not presented in the lower court, new arguments can only be introduced on appeal with special permission. The ONCA, in this case, declined to grant permission for the introduction of the new argument.

For more information regarding Bankruptcy, Collections, Fraud, and/or Trusts related topics, please contact Hyland Muirhead at Devry Smith Frank LLP at (416) 446-5092 or hyland.muirhead@devrylaw.ca.

This blog was co-authored by Articling Student, Owais Hashmi.

Sources: Ontario Securities Commission v. Camerlengo Holdings Inc., 2023 ONCA 93

The post Ontario Court of Appeal Rules Creditors May Challenge Fraudulent Conveyances Existing Prior to the Debtor-Creditor Relationship first appeared on Devry Smith Frank LLP.

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We all know that children suffer the most in family law proceedings. However, giving weight to a child’s preferences in the proceedings can give them a sense of autonomy and control of the situation. As a result, the provincial Children’s Law Reform Act and the federal Divorce Act both emphasize that courts must consider the [...]

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DSF is proudly recognized by Best Lawyers in Canada, with 7 standout lawyers in various fields.

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In a decision highly anticipated by family law litigants and practitioners across the Province, the Ontario Court of Appeal has rejected the newly created tort of family violence. This novel tort was created last year in the precedent setting decision of Ahluwalia v Ahluwalia,[1] decided by Brampton judge, Justice Renu Mandhane. Justice Mandhane ordered that [...]

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The Global Talent Stream (“GTS”) operates under the Temporary Foreign Worker Program (“TFWP”) as an efficient way for innovative Canadian firms to acquire the top foreign talent to fill a particular role when there is a shortage of domestic workers in that area. All those hiring through the GTS, must get a Labour Market Impact [...]

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François-Philippe Champagne, the Minister of Innovation, Science and Industry, on behalf of Sean Fraser, the Minister of Immigration, Refugees and Citizenship recently announced a new STEM round for the category-based selection in the Express Entry system which opened on July 5, 2023. As immigration accounts for nearly 100% of labour force growth in Canada, policy-makers [...]

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A Will is a legal document that sets out an individual’s wishes and instructions regarding the distribution of their assets and the management of their affairs after their death. In Islam, the wealth of any individual is divided into two parts: Fara’id and the Wasiyyah. Fara’id represents two-thirds of the deceased’s property and must be [...]

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According to the Canadian Fertility and Andrology Society, approximately one in six Canadians experience infertility. As a result, more and more Canadians have turned to various forms of assisted reproduction, such as in vitro fertilization (IVF). This is an increasingly important means of building a family especially for same-sex couples. With advancements in reproductive technology, [...]

The post Post-Separation, Who Gets the Frozen Embryos? first appeared on Devry Smith Frank LLP.

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Your claim may be “statute-barred” if it falls outside of the limitation periods within your jurisdiction. The Limitations Act, 2002 sets out two main limitation periods for claims commenced in Ontario: (1) a general 2-year limitation period, beginning when the claim was discovered and (2) an ultimate 15-year limitation period, regardless when the claim was [...]

The post My Neighbour’s Old Renovation Has Been Continually Damaging My Property – Can I Still Make a Claim or is it Statute-Barred? first appeared on Devry Smith Frank LLP.

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Peter Khill Gets 8 Years for Manslaughter After the Supreme Court Ordered a New Trial Based on New Self-Defence Guidelines To the surviving family members of Jonathan Styres, the scales of justice have finally balanced. Seven years have elapsed since Peter Khill fatally shot Styres, who was seemingly attempting to steal Khill’s pickup truck parked [...]

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Bothwell v London Health Sciences Centre Mental injuries can be as devastating as physical injuries to the people who experience them, but they are not as easily recognized as injuries by the courts. By law, individuals need to meet a high threshold to prove a compensable mental injury, which includes demonstrating impairment of cognitive functions [...]

The post Feelings of Anger and Frustration are Not Compensable Mental Injuries first appeared on Devry Smith Frank LLP.

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The Competition Bureau of Canada (the “Bureau”) is an independent federal law enforcement agency which aims to protect and promote competition for the benefit of Canadian consumers and businesses. The driving principle is that competition drives lower prices and innovation while also fueling economic growth. The Bureau is now casting a harsh light upon an [...]

The post How To Address Soaring Food Prices: Recommendations From The Competition Bureau Of Canada first appeared on Devry Smith Frank LLP.

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Under Section 192(3) of the Highway Traffic Act, when you rent a motor vehicle, you are ultimately responsible if you lend that vehicle to someone else. If the other person took it without your permission, you are not liable for that person’s negligence. But what if you did not explicitly provide permission for the other [...]

The post The Rebuttable Presumption of Implied Consent In Motor Vehicle Accidents When the Vehicle Was Taken by Someone Else first appeared on Devry Smith Frank LLP.

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Office of the Privacy Commissioner of Canada launches an investigation into ChatGPT: ChatGPT (Generative Pre-trained Transformer) is an artificial intelligence language model or deep machine learning model (also known as a “chatbot”) created by OpenAI. It is designed to understand natural language and generate human-like responses. It assists its users by answering their questions, providing [...]

The post What are the Benefits and Risks of ChatGPT for the Legal Profession? first appeared on Devry Smith Frank LLP.

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Amendments to the Construction Lien Act in 2017, now called the Construction Act (the “Act”), have left construction litigators confused as to whether they could combine breach of trust claims with construction lien actions. Recently, the appeal case of Devlan Construction Ltd. v. SRK Woodworking Inc. (“SRK Woodworking”) at the Ontario Superior Court of Justice [...]

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Are you interested in purchasing the property right next to yours? What about the empty lot bordering your cottage property that is up for sale? Property owners often consider purchasing an abutting property for a variety of reasons. An abutting parcel of land is one that shares at least one border with a landowner’s existing [...]

The post What Do I Need to Consider Before Buying the Property Right Next Door? first appeared on Devry Smith Frank LLP.

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To many of us, pets are more than just animals; they provide companionship, unconditional love and affection, and become part of the family. In 2022, 60% of Canadian households owned at least one dog or cat. This number grew following the COVID-19 pandemic; one-third of pet owners have brought a pet into their home since the beginning of the pandemic. As the number of pet owners increases, so does the number of ‘pet custody’ disputes. These disputes have extended beyond the realm of dogs to include cats, reptiles, horses, and even pigs. People have even reported staying in a relationship solely to maintain access to a shared pet.

These disputes leave many asking: who gets custody of your pets when your pets outlast your relationship? As many of us consider our pets to be as important as our children, we might assume that the answer lies in our pet’s best interests. The rightful owner should be the one with the bigger yard, who has the most time to spend with your pet, and who your pet is most attached to. Unfortunately, this is generally not the case in Ontario – however, recent decisions and legislative amendments hint that this could be changing.

The Traditional Approach to Pet Custody

The traditional approach to pet custody is that there is no pet “custody”. Animals have historically been considered chattel, or personal property, in the eyes of the law. The relevant legal test to determine ownership was who owned the animal and the adjudicator did not examine what was, or was not, in the animal’s best interests.[1] We’ve addressed this issue in two of our previous blogs on the topic of pet custody from 2017 and 2019.

Courts have explicitly discounted the possibility of joint custody orders for pets as a waste of judicial resources and a source of additional stress, heartache, and wasted time and money for parties.[2] While this approach is straightforward and relatively easy for the courts to apply, it inevitably leaves one party vindicated, one heartbroken, and the best interests of the animal wholly unconsidered.

But again, change may be coming.

A ‘Contemporary’ Approach?

Coates v Dickson, a recent Ontario Superior Court decision, adopted a ‘contemporary’ approach to dog ownership which examines the relationship between the dog and the parties claiming ownership. It states that the court must consider the following factors, including:

whether the animal was owned by one of the parties prior to the relationship;
an express or implied agreement in relation to ownership, either before or after the animal was acquired;
the nature of the relationship between the parties when the animal was acquired;
who purchased and/or raised the animal;
who exercised care and control over the animal;
who cared for the animal the majority of the time;
who paid for the animal’s basic needs;
whether the animal was a gift to one of the parties;
what happened to the animal after the relationship between the parties ended; and
any other indications of ownership or evidence of agreements relating to ownership.[3]

This ‘contemporary approach’ incorporates elements of the traditional property-based approach, including evidence of ownership and who initially paid for the animal. However, in holding that “[o]wnership of a dog is an investment that goes beyond the mere purchase price,”[4] the court included non-property based factors, including who raised the animal, exercised care and control over them, and who was their primary caregiver. In this case, the court held that the two dogs in question were jointly owned by the former spouses and gave one to each spouse.[5] While this is far from a shared parenting time agreement, unless we’re operating under the law from The Parent Trap, it is a step towards a legal conception of pets as more than chattel.

Legislative Changes in British Columbia

In March 2023, amendments were proposed to British Columbia’s Family Law Act in an attempt to clarify the law on pets following the breakdown of relationships. If accepted, these changes would require the courts to consider each person’s ability and willingness to care for the animal, the relationship any children of the relationship have with the animal, and any risk of family violence or cruelty posed to the animal. Proponents of these amendments point to changing values in society surrounding pet ownership towards considering pets as family members and not property. There are currently no similar provisions in Ontario’s Family Law Act; however, if these amendments come into force in British Columbia, similar changes to family legislation throughout Canada could follow.

In the Meantime, What Can I Do to Maintain Custody of My Pet?

Under the current legislative regime, what can you do to ensure that you maintain custody of your pet if your relationship ends? Here are several things that can help:

Keep detailed records of:
- who paid for your pet or their adoption fees;
- any unofficial agreement as to the ownership of your pet in case of a break-up;
- who pays for your pet on a daily basis, including food, veterinarian visits, grooming, and other basic needs;
- who is the primary caregiver of your pet;
- whether you brought your pet into the relationship or acquired them during the relationship with your partner; and
- whether your pet was a gift from one partner to the other.
Make sure that you are listed on official paperwork as an owner of your pet, such as veterinarian records, adoption applications, and pet insurance policies.
If you have or plan to get a cohabitation agreement or marriage contract, you can include a provision about who gets to keep your pet if the relationship ends.
Refer to our previous blog on the legal avenues you can take to pursue custody of your pet, including commencing court proceedings or participating in arbitration.

If uncertain, you can always consult with a family lawyer to discuss your options.

If you have more questions about your family law matter, please visit our website or contact Katelyn Bell from Devry Smith Frank LLP at 416-446-5837 or katelyn.bell@devrylaw.ca.

This blog was co-authored by Law Student, Leslie Haddock.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

[1] Baker v Harmina, 2018 NLCA 15 at para 12.

[2] Ibid at paras 23-26.

[3] Coates v Dickson, 2021 ONSC 992 at para 8. This approach has been adopted in subsequent Ontario decisions. For an example, see Duboff v Simpson, 2021 ONSC 4970 at paras 18-19.

[4] Ibid at para 17.

[5] Ibid at paras 19-20.

The post My Partner Took the House, the Kids, and Half of my Money – Can I At Least Keep the Dog? first appeared on Devry Smith Frank LLP.

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Marriage evokes thoughts of fairy tale romance, soulmates, and lifelong commitment and devotion to your partner. So, it can be awkward when you have to ask the love of your life to sign an agreement anticipating the end of your relationship. A marriage contract is a legal document signed by both spouses which defines how your family property will be divided and what support will be provided to you, your spouse, and your children following divorce or the death of a spouse.

Although marriage contracts are criticized as being unromantic and uncomfortable, they are far from impractical. Even when the court system was paralyzed by COVID-19 in 2020, there were over 42,000 divorces granted in Canada. As with our previous discussion about the benefits of cohabitation agreements for common-law partners, there are many benefits to having a marriage contract. Marriage contracts provide for increased certainty, flexibility, and customization within the current legislative regime; for the protection of your assets; and helps to prevent lengthy, bitter, and expensive court battles. However, there are several limitations and restrictions when it comes to enforcing these contracts. This leaves many people wondering at the end of their relationship: is my marriage contract actually enforceable? Here are five things to consider:

When Do I Have to Sign a Marriage Contract?

Although the name implies that you must be married, you do not have to wait until marriage to sign a marriage contract. Marriage contracts are available to married couples and couples who intend to marry; however, for the latter, the contract does not come into effect until the date of marriage. Likewise, you are free to sign a marriage contract even years after marriage. If you are in a common law relationship and already have a cohabitation agreement, then that agreement will be deemed to be a marriage contract if you marry your common law partner.

What are the Requirements for a Marriage Contract?

There are strict procedural guidelines that must be followed for a marriage contract to be enforceable. The document must be in writing, signed by the couple, and witnessed. This means that oral marriage contracts are not valid in Ontario.

What Can Be Included in my Marriage Contract?

Marriage contracts can include terms related to the ownership in or division of property, support obligations, the education and moral training of the your children, and any other matter related to the settlement of the yours and your partner’s affairs. However, as a previous blog of ours discussed, several matters cannot be included in a marriage contract, including:

decision-making responsibility and parenting time for children; and
provisions which limit your rights regarding possession of the matrimonial home.
Can my Marriage Contract Be Set Aside by the Courts?

In Canada, courts tend to favour the validity of marriage contracts and strive to “respect private arrangements that spouses make for the division of their property on the breakdown of their relationship.”[1] However, even if a marriage contract is in proper form and contains no prima facie invalid terms as discussed in the previous section, courts may exercise their discretion to set it aside.

Courts can set aside any provisions which they consider to not be in the best interests of any of your children or which are unreasonable in regards to the Child Support Guidelines or otherwise in relation to the support of a child.

Section 56(4) of the Family Law Act also lays out specific circumstances in which courts can set aside a marriage contract or a provision within it:

if a party to the contract failed to make full and accurate financial disclosure in regard to significant assets, or debts and other liabilities;
if a party to the contract did not understand the nature or consequences of the contract; and
if there are any other grounds present to justify setting aside a contract under general contract law, including unconscionability, duress, undue influence, fraud, or misrepresentation.

However, this section is not a “get-out-jail-free” card for people trying to invalidate their marriage contract. This section does not apply if you signed the agreement while knowing your partner’s financial disclosure was inadequate. Courts will generally also refuse to set aside contracts if you simply failed to seek legal advice and if you failed to use due diligence in seeking disclosure.

The Ontario Court of Appeal set out a two-stage test to determine whether part or all of a marriage contract can be set aside in Le Van v Le Van. The applicant must meet the following conditions:

Have any of the circumstances set out in section 56(4) of the Family Law Act (as set out above) been engaged?
Is it appropriate for the court to exercise discretion to set aside some or all of the agreement?[2]

If this test is met, then the court can intervene to declare some, or all, of your marriage contract unenforceable. As these applications come down to the discretion of the courts, it can be difficult to predict how challenges will play out. To make your marriage contract as strong as possible, it is best to avoid engaging the above circumstances altogether. For your part, you and your partner should be honest when disclosing your financial situation and seek independent legal advice before signing.

What Happens if my Marriage Contract is Unenforceable?

If you and your partner divorce or if one of you dies and you do not have a valid and enforceable marriage contract, then the default rules under the Family Law Act apply.

If you are uncertain about whether your marriage contract is enforceable or want to ensure that your marriage contract is enforceable, it is always good practice to consult with a family lawyer.

If you have more questions about your family law matter, please visit our website or contact John P. Schuman from Devry Smith Frank LLP at 416-446-5080 or john.schuman@devrylaw.ca.

This blog was co-authored by Law Student, Leslie Haddock.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

[1] Hartshorne v Hartshorne, 2004 SCC 22 at para 9.

[2] Le Van v Le Van, 2008 ONCA 338 (CanLII) at para 51.

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The Provincial Nominee Program (“PNP”) allows foreign nationals to immigrate to Canada through provincial or territorial selection in partnership with Immigration, Refugees and Citizenship Canada (IRCC).

Each province and territory mandate their own nomination streams through requirements tailored to address the province’s economic and labour needs. Quebec and Nunavut do not participate in the Provincial Nominee Program. Quebec has the authority to establish its own selection criteria for economic immigration.

Depending on the applicable stream, applicants may use Express Entry or the non-Express Entry process. Applicants will also need to complete an immigration medical examination and submit police clearance certificates among other requirements.

Under the non-Express Entry Stream, applicants who meet the eligibility requirements may apply to the province or territory for nomination.

For the Express Entry Stream, applicants may apply to the province or territory for nomination. If selected, applicants will indicate the nomination in the Express Entry profile. Alternatively, an applicant may select provinces and territories of interest in the Express Entry profile, and a province or territory may send a corresponding “notification of interest” to the applicant.

In addition to the requirements under the Provincial Nominee Program, Express Entry candidates must meet the minimum criteria for Express Entry including eligibility for the federal government’s Express Entry immigration programs.

Provincial or Territorial Nomination: Ontario

The Ontario Immigrant Nominee Program (OINP) operates nine different streams for candidates under its program. To qualify under OINP, applicants must register an expression of interest and receive an invitation to apply.

Candidates may apply if they meet the eligibility requirements under the following:

Foreign Worker Stream: Designed for applicants who are skilled foreign workers with a job offer in Ontario.
International Student Stream: Designed for applicants who are recent graduates with a job offer in Ontario.
In-Demand Skills Stream: Designed for applicants in an in-demand occupation with a job offer in Ontario.

If an applicant has a Masters or PhD degree from an Ontario university, the applicant can apply for the following streams:

Masters Graduate Stream: Designed for applicants who have obtained a masters degree from an Ontario university.
PhD Graduate Stream: Designed for applicants who have obtained a PhD degree from an Ontario university.

If an applicant has the skills and experience that an Ontario employer requires, the applicant can submit an application through the federal government’s Express Entry program:

Human Capital Priorities Stream: Designed for applicants who have the required skilled work experience, education, and language abilities.
Skilled Trades Stream: Designed for applicants with Ontario work experience in an eligible skilled trade.
French-Speaking Skilled Worker Stream: Designed for French-speaking applicants with strong English language abilities.

If an applicant is a foreign entrepreneur and wishes to establish a new business or grow an existing business in the province, the applicant may apply to the Entrepreneur Stream. To qualify, applicants must register an expression of interest and receive an invitation to apply.

The OINP is a designated referral partner under Canada’s Global Skills Strategy.

Conclusion

The PNP program allows skilled workers to establish permanent residence in Canada through the various economic pathways that Canada’s provinces and territories have to offer. While PNP programs may be suitable for skilled workers with the required skills and work experience for a particular stream, Canada also offers other programs that allow foreign nationals to immigrate to Canada based upon other considerations such as family reunification.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. For more information about immigration and your specific circumstances, please contact a lawyer in the Immigration Law Group.

This blog was co-authored by student-at-law, Abby Leung

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Last week, Public Safety Canada released a statement on a hotly contested piece of legislation that could become the strictest gun law in North America. Bill C-21, which was first introduced one year ago, proposes amendments to four federal laws: the Criminal Code, the Firearms Act, the Nuclear Safety and Control Act, and the Immigration and Refugee Protection Act.

Bill C-21 is currently at the committee stage, so it is a long way from becoming law. If it passes, though, it has major ramifications for those living in or coming to Canada.

Below is everything you need to know about this huge bill as it relates to criminal law:

Key Amendments to the Criminal Code1. Replica Firearms: the bill gives an enhanced, wider definition of replica firearms. Replica firearms are already a prohibited device, so this amendment prohibits more types of fake guns. 2. No Altering Cartridges: a brand-new offence would be added to the Criminal Code. Even if the firearm itself is not a prohibited device, altering the magazine cartridge can turn it into a prohibited device if the alteration would cause the magazine to exceed its lawful capacity. This carries a maximum sentence of five years in prison. 3. Orders on Emergency Prohibition or Emergency Limitations on Access: not only would the bill prevent more firearms from entering and/or remaining on the market, but it also calls for the empowerment of individuals to bar others from acquiring or in some ways accessing prohibited devices for public safety reasons. The individual seeking this order would apply to a provincial court judge who would hold a hearing with the applicant to determine whether public safety or the safety of the gun owner is at stake. If the applicant can satisfy the judge that this criterion is met, the order will be granted. These orders could last indefinitely. 4. Stiffer Sentences: a four-year increase (i.e., from 10 to 14 years) in the maximum prison term for certain possession offences, as well as trafficking and importing and exporting firearms.

Implications of These Amendments: What Does the Future Hold?As the government attempts to push the committee debates along, Canadians are looking to the future of firearms and their impact on our communities. The focus of Bill C-21 is really to ban assault weapons in general, as well as preventing guns from getting into the wrong hands. It is apparent that the government hopes that by limiting the kinds of firearms available, what they can be used for, and who can own and operate them, these goals will be achieved.

If you or someone you know is facing firearms-related charges, or you are concerned about how the potential amendments to the Criminal Code impact your currently legal gun ownership, contact David Schell.

This blog was co-authored by student-at-law Rachel Weitz.

The post The Future of Firearms: Bill C-21 Proposes Strongest-Ever Restrictions first appeared on Devry Smith Frank LLP.

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For those who practice impaired driving and 80 plus law, the Supreme Court of Canada (SCC) recently rendered two decisions of interest.

v. McColman, 2023 SCC 8

On March 23, 2023 they decided an appeal from the Court of Appeal for Ontario, which dealt with whether a sobriety test under section 48 of the Ontario Highway Traffic Act could be conducted on private property.

In the case of R. v. McColman, the Ontario Provincial Police had spotted the accused driving an all-terrain vehicle (ATV) out of a convenience store parking lot onto a highway. The officers followed the ATV and caught up to Mr. McColman about a minute later, when he had pulled onto the private driveway of his parents’ home. The officers approached Mr. McColman in the driveway and observed obvious signs of impairment. The officers arrested him for impaired driving and brought him to the police station, where he did two breathalyzer tests. Mr. McColman was then charged with impaired driving and operating a motor vehicle with a blood alcohol concentration above the legal limit.

Key evidence at the trial was the testimony of one of the officers that they did not see any signs of impairment before stopping Mr. McColman. The officer explained that they stopped the accused while they were exercising their authority to conduct random sobriety checks under section 48(1) of Ontario’s Highway Traffic Act (HTA). This section gives the police the authority to randomly stop a motor vehicle and check if the driver is sober. The trial Judge convicted Mr. McColman of driving with excess blood alcohol.

Mr. McColman appealed the trial decision. He argued the sobriety stop was illegal under section 48(1) of the HTA because it was conducted on private property. Mr. McColman’s appeal eventually made its way to the Supreme Court of Canada.

The SCC agreed with the argument of Mr. McColman and held that the officers did not have the authority under section 48(1) of the HTA to conduct the random sobriety stop in the private driveway. In their opinion, the HTA defined a “driver” as someone who drives or has care or control of a vehicle on a highway. A highway is defined as a “common and public highway, street, avenue that is intended for or used by the general public”. They said Mr. McColman was not a driver for the purpose of section 48(1) because he was not on a highway when the police made the stop. As such, the stop was unlawful, resulting in the arbitrary detention of Mr. McColman and the violation of his section 9 Charter rights.

The success of this appeal argument was likely of little comfort to the accused. In the end, the SCC ruled that despite the breach of Mr. McColman’s section 9 rights under the Charter, the breathalyzer results obtained from the unlawful stop were still admissible under section 24 (2) of the Charter. In determining whether to exclude the evidence, the Court felt that due to the nature and importance of the evidence, as well as the seriousness of the offence, admitting the evidence was warranted despite the Charter breach. As a result the conviction of Mr. McColman was upheld.

2. v. Breault, 2023 SCC 9

In the second case arising out of Quebec, the SCC ruled on whether a police demand to provide a sample into an Approved Screening Device (ASD) was valid when police did not have the device with them at the time of the demand.

In the Breault case the police had stopped the accused after reports that someone was driving an all-terrain vehicle while drunk. The officers wanted to take a breath sample from Mr. Breault, but they did not have an ASD on hand. They radioed nearby officers to obtain a device. While still waiting for the device, the officers demanded that Mr. Breault provide a breath sample and Mr. Breault refused three times to provide a sample. Mr. Breault was then charged with refusing to comply with a demand by police to provide a breath sample.

In their April 13, 2023 decision, the SCC determined that such a demand was invalid as it was not in compliance with the provision in the Criminal Code that such a sample be provided “forthwith”. As outlined in the case brief from the Supreme Court,

Writing for a unanimous Court, Justice Suzanne Côté ruled that the validity of a demand to provide a breath sample requires that police have immediate access to an ASD at the time the demand is made. According to Justice Côté, the word “forthwith” in section 254(2)(b) must, as a general rule, be given a strict interpretation that reflects its ordinary meaning, namely “immediately” or “without delay”. At this step of the detection procedure, a detained driver does not have a right to counsel as guaranteed by section 10(b) of the Canadian Charter of Rights and Freedoms, since the driver must provide a breath sample immediately. The limit on this right is justified because the detention is very brief. It is therefore essential to the constitutional validity of this provision that the interpretation given to the word “forthwith” be consistent with its ordinary meaning. As she noted, “[t]he more flexibly the word ‘forthwith’ is interpreted, the less the recognized justification for limiting the right to counsel holds up”.

Justice Côté stated that, exceptionally, unusual circumstances may justify a flexible interpretation of the word “forthwith” if they are related to the use of the device or the reliability of the result. However, unusual circumstances cannot arise from budgetary considerations or considerations of practical efficiency, such as the supplying of ASDs to police forces or the time needed to train officers to use them. The absence of a device at the scene at the time the demand is made is not in itself an unusual circumstance.

This SCC decision dealt with the interpretation of “forthwith” under the previous version of the Criminal Code (section 254(2)). In 2018, Parliament enacted section 320.27 of the Code which replaced that language with the term “immediately”. The intent behind this change was to adopt clearer language and not change the law.

The Court in Breault addressed the applicability of their interpretation of “forthwith” with the newer section of the Code. At paragraphs 38 to 44 of their decision, the Court analyzed and confirmed “that the guidance provided by this judgment on the interpretation of the immediacy requirement in s. 254(2)(b) Cr. C. applies to the interpretation of the word “immediately” in s. 320.27(1)(b) Cr. C.”

. . . . .

If you have been charged with an Impaired driving or a DUI related offence, please contact David Schell at Devry Smith Frank LLP to discuss any questions and your options at 416 446-5096 or david.schell@devrylaw.ca.

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On April 6, 2023, the Ontario government released the proposed Provincial Planning Statement 2023 (“PPS”) which is intended to simplify and integrate existing policies to achieve housing objectives while providing tools for municipalities to deliver on housing objectives. The PPS recognizes that the objectives for achieving housing outcomes are not universal and provides a more flexible approach for municipalities to adapt and implement policies based on the municipality’s requirements.

The following are highlights of the changes within the proposed PPS:

Building Homes, Sustaining Strong and Competitive Communities

The proposed PPS has removed the requirement that municipalities meet specific intensification and density targets to accommodate forecasted growth, with the exception of density targets for major transit station areas in large and fast-growing municipalities. Instead of this requirement, municipalities are encouraged to establish density targets that are appropriate for the municipality’s needs. The proposed PPS identified 29 municipalities that are required to identify and focus growth in strategic growth areas, including identifying an appropriate minimum density target and planning to meet minimum density targets for major transit station areas.

The proposed PPS further provides broader permissions to expand residential housing to facilitate further development, including converting existing commercial and institutional buildings for residential use, developing and introducing housing options within previously developed areas, and redeveloping areas to increase the number of residential units. In addition to increasing the number of residential units, the proposed PPS provides that planning authorities shall promote economic development and competitiveness by providing an appropriate mix of employment, institutional, and broader mixed uses to meet the long-term needs of residents, including identifying sites suitable for building infrastructure for employment purposes.

The proposed PPS permits multi-lot residential development on rural lands where appropriate sewage and water servicing can be provided and removes the test for when infrastructure is proposed to be expanded for rural development, providing greater flexibility for private servicing – municipalities must consider “locally appropriate” rural characteristics when directing development in rural settlement areas. Lastly, municipalities must engage in planning with an eye towards reducing greenhouse gas emissions and to prepare for the impacts of climate change through approaches that support and incorporate climate change considerations in developing infrastructure.

Employment

The proposed PPS further overhauls the employment protection scheme in Ontario as it actively promotes mixed-use development where the mix of uses are compatible, and protects and preserves areas that are largely industrial and manufacturing areas. The definition of employment areas prohibit institutional uses and commercial uses unless those commercial uses are associated with primary employment use which include manufacturing uses, research and development uses. As such, the change to the definition of employment areas draws a clear distinction between commercial uses, institutional uses, and retail/office uses, that are not associated with primary employment.

The proposed PPS further clarifies the test for employment conversion requests and removes the requirement for municipal comprehensive review. The new test outlines that planning authorities may remove lands from employment areas only where it is demonstrated that:

There is an identified need for the removal and the land is not required for employment area uses over the long term;
The proposed uses would not negatively impact the overall viability of the employment area by
1. avoiding, or where avoidance is not possible, minimizing and mitigating potential impacts to existing or planned employment area uses in accordance with policy 3.5; and
2. maintaining access to major good movement facilities and corridors; and
Existing or planned infrastructure and public service facilities are available to accommodate the proposed uses.

Lastly, the proposed PPS suggests selecting provincially significant employment zones or portions of provincially significant employment zones to protect employment uses.

Settlement Area Expansion

The proposed PPS removes the need for a municipal comprehensive review and allows settlement area expansion as long as policy tests are met. In addition to removing references to a municipal comprehensive review, the municipality must be able to demonstrate that:

that there is sufficient capacity in existing or planned infrastructure and public service facilities;
the applicable lands do not compromise specialty crop areas;
the new or expanded settlement area complies with the minimum distance separation formulae;
impacts on agricultural lands and operations that are close to the settlement area are avoided, or minimized and mitigated if avoidance is not possible;
the new or expanded settlement area provides for the phased progression of urban development.

Land Use Compatibility

The proposed PPS provides enhanced protections for industrial and manufacturing uses as well as other major facilities from encroachment on sensitive land uses and revises the test planning authorities must consider where it is not possible to avoid adverse effects from odour, noise, and other contaminants. The proposed PPS also removes any reference to adverse effects to the proposed sensitive land use being minimized and mitigated, revealing a greater focus on protecting longer-term viability of industrial and manufacturing uses, as well as major facilities.

Agriculture

The proposed PPS would no longer require municipalities to use the provincially mapped Agricultural System in developing lands within prime agricultural areas. Municipalities will still be required to designate and protect prime agricultural areas for long-term use but it will be easier to establish more housing within prime agricultural lands. The policy would also allow principal dwellings associated with agricultural operations to be located within prime agricultural areas as an agricultural use and permit residential lot creation in these areas in accordance with provincial guidelines for “new residential lots created from a lot or parcel of land that existed on January 1, 2023”. Lastly, the proposed PPS would require an agricultural impact assessment to avoid impacts from any new or expanding non-agricultural uses on surrounding agricultural lands and operations.

Natural Heritage System/Management of Resources

The proposed PPS provides that planning authorities prioritize protecting or restoring the quality and quantity of resources including water, minerals, as well as cultural heritage and archaeological sites from land alterations. The development of new housing and site alteration should be limited to surface water features and sensitive ground water features. The proposed PPS favours balancing the use and management of natural resources with attention to appropriate housing supply and considers the mitigating effects of vegetation and green infrastructure in developing housing supply.

As noted above, the proposed PPS has the potential to change the planning regime in Ontario. To better understand the provisions within the proposed PPS, please contact one of the following municipal and development lawyers today!

Larry W. Keown-larry.keown@devrylaw.ca, 416-446-5815

Marc Kemerer–marc.kemerer@devrylaw.ca, 416-446-3329

David S. White–david.white@devrylaw.ca, 249-888-6633

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Entrepreneurs looking to start a business in Canada can turn to Canada’s Start-up Visa Program as an opportunity to obtain permanent residence in Canada through business immigration. Canada’s Start-Up Visa Program targets immigrant entrepreneurs with the skills and potential to build businesses that are innovative, create jobs for Canadians, and are competitive on a global scale.

Here is what you need to know about Canada’s Start-up Visa Program:

Eligibility

In order to be eligible for a Canadian start-up visa, applicants must meet four requirements: they must (1) have a qualifying business, (2) have a letter of support from a designated organization, (3) meet the language requirements, and (4) have sufficient settlement funds.[1] The Province of Quebec is in charge of its own business immigration program.

A qualifying business means that each applicant holds at least 10% of the voting rights attached to all outstanding shares of the company and together with the designated organization, they jointly hold more than 50% of the total voting rights attached to all outstanding shares of the company. At the time that the applicant receives permanent residence, the applicant must provide active and ongoing management of the business from within Canada, must ensure that an essential part of the operations of the business happens in Canada, and incorporate the business in Canada.[2]

A letter of support from a designated organization requires endorsement from a business group that has been approved by the federal government to invest in or support possible start-ups. A designated organization can include a venture capital fund, angel investor group, or a business incubator. A list of designated organizations can be found here.[3]

All applicants must take a language test from an approved agency and meet the minimum level of the Canadian Language Benchmark 5 in either English or French in all of these areas: speaking, reading, listening, and writing.[4]

Applicants must also demonstrate that they have enough funds to support themselves and their dependents after arriving in Canada. The amount needed to demonstrate proof of financial support is based on the size of the applicant’s family and can be found here.[5]

Benefits of the Start-Up Visa Program

The Start-up Visa Program allows Canada to attract and retain high potential entrepreneurs who have an innovative and scalable business. The economic benefits of hosting a successful start-up can lead to job creation, training and cultural advantages for Canada.

For prospective entrepreneurs, the program allows applicants a direct pathway for permanent residence in Canada and is open to all nationalities. The program does not limit the applicant on what type of business he or she can conduct in Canada and there is no net worth requirement.

Determining the potential of a start-up can be challenging. However, through approved business partners, immigrant entrepreneurs can access funding, professional contacts, and mentoring to set them on a path to success. Applicants also have the opportunity to apply for a work permit while the application is in process.

A start up visa may be suitable for entrepreneurs who are able to secure the capital and support from designated organizations to establish and grow their business in Canada.

For other migrants looking to work in Canada, there are other temporary and permanent immigration programs that provide an opportunity to participate in the Canadian labour market and gain professional experience in Canada.

This blog was co-authored by student-at-law, Abby Leung

[1] https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/eligibility.html

[2] https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/eligibility.html

[3] https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/designated-organizations.html

[4] https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/eligibility.html

[5] https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/start-visa/eligibility.html

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In our education law practice, around half of our cases are on behalf of parents against private schools because the school did not meet the parent’s expectations, told a child to leave without good reason, or did not meet their child’s needs. This post is not intended to take a stand against private schools. Half of our cases on behalf of parents are against public schools. However, it is often the private school parents, not the public school ones, who have large misconceptions about how Ontario’s Education Act, or Education Law more broadly, apply to the schools their children attend.

The reality is that Ontario Private Schools do not have the same curriculum, rules or legally imposed standards that public schools do. The Ontario Government allows a lot more choice when parents choose private education.

That is precisely the reason why parents pick Ontario Private Schools. Some parents do not want their kids taking sexual education classes, some don’t like the anti-bullying component that is mandatory in public schools, some parents what subjects taught with a religious focus, some parents want schools that use permissible corporal punishment or other types of discipline that are not available in public schools, some parents don’t want their kids being taught alongside kids that have special needs or are otherwise disadvantaged, some parents want teachers with qualifications that are different from the qualifications required by the Ontario College of Teachers or want their children to have teachers that are not confined by the standards of practice and ethics imposed by that body.

Choosing Private School is About Opting Out of Government Standards and Requirements

In choosing a private school, parents are choosing an education that is very different from that provided by public schools. This post is not about whether public or private schools are better because that largely depends on the specific school in either system. But, what many parents do not understand is that while it is NOT true that the Education Act does not apply to private schools, more than 95% of the Education Act does not apply. Further, the Ministry of Education does not regulate, license, or otherwise oversee the day-today-operation of private schools. The Ministry does not even inspect elementary schools or high schools that do not grant Ontario Secondary School Diplomas, even if those schools provide other diplomas such as the IB program.

The Ministry of Education provides a LOT of direction to public schools about how they will operate. It does this through the Education Act, Government Regulations, and Policy and Procedure Memoranda that all set out exactly how public schools must do things. In most, if not all, circumstances, those directions are rooted in the latest research into best teaching practices. In several areas, the expectations placed on public schools are considered to be the best in the world. But private schools are not required to follow them.

To be clear, private schools do NOT have to follow the direction of the Ministry of Education in areas such as:

Discipline – including suspensions, expulsions, or other forms of discipline
Removing a child from his or her school
Addressing the special needs of students
Anti-bullying programs
Specific curriculum content
Student evaluation or testing procedures
Communication with parents
Participation in school activities
Codes of conduct or dress code
Vaccination or other health requirements or
Record keeping
Teacher or principal qualifications

If your child needs or would benefit from the specific standards or procedures set by the Ministry of Education, then you may want to look at public schools and even what you have to get your child into a specific public school.

Many private schools boast of having standards that exceed the requirements expected of public schools. But, there is no legislative nor government requirement that a private school even meet the standards in public schools. The Ontario Government is not going to step in to ensure that a child is being properly educated or treated at a private school and will look at the curriculum content only if the school wants to give the student an Ontario Secondary School Diploma.

Private School Standards Are Set Privately Between Parents and the School

That does not mean there are no legal requirements placed on private schools, just that those legal requirements do not come from the government. Instead, they come from the contract that the parents sign with the school. Like with End User Licence Agreements on apps and phones, parents tend to skip over these contracts assuming they have some form of standard terms, or that they are related only to the payment of fees or other unimportant matters. But, those contracts set out what education parents can expect their children to receive and how the school will treat those children.

Private Schools Set Their Own Rules for Kicking Kids Out

Looking at specifics, one area where private school parents are often caught off guard is about private schools kicking kids out. There are a lot of rules that public schools have to follow if they want to kick a kid out and public schools cannot just tell a kid not to come to school anymore. Private schools don’t have to follow any of those rules.

Private schools can force a student to leave based on what is set out in the contract. Most of the established private schools have contracts that essentially say “We can permanently remove any student from the school at any time, for any reason and we do not have to have a hearing or listen to the parents at all and we do not have to refund any portion of the tuition.” Parents usually just sign that contract without thinking about it. Some schools set out a procedure, or say they will mirror the requirements placed on public schools by the Education Act, or that students can only be ejected for violating the code of conduct. However, most private schools do not have those sorts of terms in their contracts with parents and instead have contracts that allow them complete discretion as to when to remove students. Most private schools can even remove a student who is a victim of bullying or other acts because the victim student “does not fit in” or the aggressor students are more desirable.

Almost all private schools reserve the right not to readmit students for future academic years. That means they can literally say in June that they don’t want to see a student anymore in September, although that can be difficult if the school and parents have signed a new contract earlier in the year.

If parents do not like this possibility, they have to carefully read the contract and make sure they don’t enroll at a school where the contract will allow things to happen that they don’t like.

And to be clear, our firm has done lots of cases where parents do not believe their child would be removed from the school. This can be because they went to the school themselves, or they have other children who are at the school or were at the school, or they cannot foresee any situation where a school would not want their child, or even because they have given the school a LOT of money. We have seen lots of cases where parents are absolutely shocked to learn that their child is no longer welcome at a private school and the school is using the terms of the contract against them.

When parents come to see us, we do have some remedies under contract law or human rights law and some other strategies we can try to fix the situation. You can make an appointment by calling 416-446-5847. But, the stronger the contract, the more difficult – AND EXPENSIVE – it will be to try to fix things. So, parents should review the contract carefully – and usually the Code of Conduct that is incorporated into the contract – to make sure the contract meets their expectations and will not come back to haunt them if things go sour.

Admission Processes And Decisions Are Made By the School

We do understand that parents are often just glad that their child got accepted into a private school as it can be very competitive to get in and that it can be embarrassing when a child is not accepted into a private school, particularly when it seems their child is not “up to snuff” or may have unique needs that are keeping them out. Private schools are private businesses so they can choose who they serve and who they do not – unless the decision violates the Ontario Human Rights Code. But many private schools have complex multi-stage admission processes that allow them to deny admission for reasons that are not related to a student’s traits that would violate the Human Rights Code. The last thing that most parents want to do is start questioning the terms of the contract when the school might just turn around and offer the place to another child.

Still, we see many parents who are not happy with a private school and where that school failed to meet their expectations. Parents do need to carefully read that contract. If what it promises is different from what parents expect, they need to consider whether that school is the right one. It can be difficult to fight what a school is doing, even when kicking a student out if the school can point to their contract and say it is allowed under the contract, or our contract doesn’t require what the parents expect.

Grades and Academic Discipline

Giving out grades is one of the very few areas where the Ministry of Education does have expectations of private schools, but not in a way that really assists parents.

Private schools are required to have a policy about how they will communicate student achievement to parents. But, how private schools communicate student achievement is entirely up to the private school. They can use the Ministry of Education standard report cards, but they do not have to do so. They do not even have to use formal grades.

However, to grant a credit towards a course that will lead to an Ontario Secondary School Diploma, private schools must show that their evaluation of students is based on evidence of achievement of the provincial curriculum expectations, is conducted several times during a course and uses several methods for evaluating the student, as well as meeting other criteria.

When it comes to challenging whether an evaluation of a student was fair or accurate, there is no direct way to challenge a private school’s methodology. Many private school contracts specifically state that parents cannot, and will not, do that. Doing so will be, at best, difficult.

Similarly, there are no direct ways to challenge a school’s finding that a private school has acted with academic dishonesty, or the method used in the investigation. Where a school makes such a finding and the imposes consequences are consistent with a Code of Conduct that has been incorporated into the contract with the parents, there is little that private school parents can do. If the consequences are severe for the student, they may want to consult with a education lawyer to see if there are any unusual or creative legal solutions available.

One course of action that might be available where the school imposed a grade or discipline that did not take into account a student’s special needs, is to pursue a remedy based on human rights grounds.

Private Schools Usually Do Have To Accommodate Special Needs

Ontario public schools have a refined process for identifying and providing assistance to kids. While, in most circumstances, private schools cannot refuse to admit a student because that student has special needs, they often find other reasons to refuse admission. However, once a student is in a private school, that school has to accommodate that child’s special needs to the point where it will cause undue hardship.

For very small, usually religious based private schools, that are not-for-profits, and that charge very little for tuition and do not have much in the way of resources, the school may legitimately not be able to provide much accommodation for special needs. But larger schools can, and must, provide accommodation for student’s special needs. People cannot contract out of the Ontario Human Rights Code, so the contract is not a factor in those circumstances. If a private school student has a disability or needs some other type of special treatment or services, the private school cannot refuse to provide those accommodations if it is reasonably able to provide them. Private schools cannot refuse to continue to reach a student because that student has a special need that the school could reasonably accommodate.

While we often hear private schools say “we don’t do things that way”, or “our standards do not allow us to provide accommodation”, the law says differently. Any parent faced with that sort of attitude should get advice from an education lawyer.

Bullying – It’s Up To Private Schools What To Do, If Anything

One thing that can actually CREATE special needs in a student is repeated bullying. Bullying can cause lots of long lasting serious problems and is rarely character building for the victim. It often leads to mental health problems that negatively impact a student’s ability to learn and the benefit of attending a private school. The Education Act and the Ministry of Education place a lot of legal obligations on public schools to prevent and address bullying. Those measures are based on the latest research into bullying and its effects.

There is nothing in the legislation or from the Ministry of Education that requires private schools to do anything about bullying. Again, that is an intentional decision by government because some parents do not want their children exposed to anti-bullying programs and believe that bullying can be good for kids. They can chose to send their children to schools that allows or encourages bullying behaviour, hazing, peers teaching each other lessons, or other similar behaviour. Other private schools have very strict anti-bullying measures, some of which are modeled on what is required in public schools. Again, to a point, what a private school is legally required to do about bullying is set out in the contract with parents – to a point.

There can be legal consequences for a private school that allows bullying. When a school fails to supervise students properly, it can be liable for damages for mental or physical harm caused to a student. The law does not permit students, or the student’s parents, to consent to the student being seriously harmed. So, a school that says parents agreed to let their child be bullied will not be successful with that position in court. In addition, many types of bullying, anything that is based on disability, race, ethnic origin, family status, sexual orientation, gender or similar traits is a violation of the Ontario Human Rights Code. So, there can be penalties for institutions when bullying is also bigoted.

Since bullying can have a lot of serious negative repercussions, it can lead to mental or physical disabilities. Once a child has such disabilities, the child’s school is required to accommodate those challenges to the point of undue hardship. When those disabilities were caused by events at school, it is really difficult for a school to get away with saying that fixing a problem that it, in part, caused, will be too hard.

Private Schools Can Hire Whatever Teachers They Like, Regardless of Qualifications

Sometimes children run into trouble at private schools because one or more of their teachers or principals do not have any teaching qualifications and so do not know how to address certain educational situations or issues. Again, the Ontario Government made a policy decision to allow a broader range of qualifications than are required to teach in the public system, so there are no minimum qualifications for private school educators or administrators. In addition, private school teachers do not have to be members of the Ontario College of Teachers – in fact they can’t be if they don’t have the qualifications to get a teacher’s license. If a private school teacher is not a member of the college of teachers, there is no body to complain to about the competence of ethics of that private school teacher.

Some private schools do require their teachers to be members of the college of teachers. But, the private schools themselves are not required to use only licensed teachers unless their contract with their parents says so.

Conclusion

To summarize, it is important for parents to read the contract with a private school, which often incorporates a code of conduct and other documents or policies, before signing their child up to attend that school. Even if they feel they have no choice but to send their child to that private school, that contract tells them what they can expect, including the standards (if any) that will be applied to their child’s education. There are no mandatory government standards for how children will be educated in private schools in Ontario, or what they quality of that education will be. Parents can only hold a price school to the contract, and perhaps human rights legislation. If the school does not violate either of those, but the school does not meet the parents’ expectations, there will not be any government intervention and there may few legal options – even if a child suddenly finds him or herself without a private school to attend.

The post What Parents Need to Know About Private Schools and Education Law – Before Signing Their Kids Up first appeared on Devry Smith Frank LLP.

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BCIMC Construction Fund Corp. et al. v. 33 Yorkville Residences Inc. et al., 2023 ONCA 1 (CanLII)
The decision in BCIMC Construction Fund Corp. et al. v. 33 Yorkville Residences Inc. et al.[1], involved a number of lien claimants which had provided services and materials to the owner of a condominium development. The owner of the condominium had become insolvent and the property subject to the improvement had sold by a Receiver pursuant to a court order. At the time of sale, there were six mortgages registered against the property and two were building mortgages pursuant to Section 78(2) of the Construction Act.[2]The parties did not dispute that the lien claimants are entitled to a priority payment out of the proceeds of sale to the extent of any deficiency in the owner’s holdback under Section 22(1) of the Construction Act. The issue in dispute was the distribution priority pursuant to Section 78(2) of the Construction Act, which outlines the method in determining the amount of the deficiency to which the priority applies. The lien claimants brought a motion to determine this issue.

The lien claimants took the position that because there were two building mortgages, they were entitled to priority with respect to the deficiency in holdback over each mortgage. In other words, where the deficiency in holdback was the 10% which the owner was required to retain under the Act, the lien claimants took the position that they were entitled to a 10% priority over each building mortgage such that the total amount for which their liens had priority amounted to 20% of the price of services and materials supplied.

In interpreting Section 78(2) of the Construction Act, the Ontario Superior Court held that lien claimants are limited to priority over all combined building mortgages, rather than each mortgage separately.[3] As such, the lien claimants’ motion was dismissed. The claimants appealed to the Ontario Court of Appeal. The Ontario Court of Appeal dismissed the lien claimants’ appeal.

Background – The Construction Act
Under Section 22(1) of the Construction Act, each payor in a contract or subcontract where a lien arises must retain a 10% holdback of the price of the services or materials supplied until all liens have expired or are satisfied.[4] Section 78 of the Construction Act provides additional rules concerning priority between mortgagees and lien claimants and provides that subject to exceptions, liens from an improvement have priority over all mortgages.[5]

The exception in this case appears in Section 78(2) which deals with building mortgages. Section 78(2) provides that the lien has priority to the extent of any deficiency in the holdbacks required to be retained, regardless of when that mortgage or the mortgage taken out to repay it is registered.[6]

The lien claimants submitted that the interpretation of Section 78(2) requires that each lien claimant has priority over each building mortgage to the extent of the deficiency in the holdback. Since there were two building mortgages registered on the property, the lien claimants argued that they were entitled to priority over each building mortgage to the extent of the deficiency in the holdback totalling a 20% holdback fund. The lien claimants further argued that the context and purpose of the Construction Act was to protect lien claimants as subsequent building mortgagees expect to assume more risk than prior mortgagees and should not be insulated from additional risk by limiting a lien claimant’s priority to one 10% deficiency claim. Finally, the lien claimants submitted that the case of GM Sernas & Associates Ltd v. 846539 Ontario Ltd.[7] should be distinguished from the present case. In Sernas, the Ontario Court of Justice held that the maximum priority of a claim for lien over two mortgages is 10%, saying that there is one holdback figure and that the deficiency is the full holdback figure.[8] The lien claimants argued that the issue on whether priority is to measured against each mortgage separately was not addressed in Sernas and that as such, Sernas was not binding on the claimants.[9]

Ontario Superior Court’s Decision
The Ontario Superior Court dismissed the lien claimants’ motion as the lien claimants’ interpretation of Section 78(2) of the Construction Act limited the meaning and effect of key words in the section, reads in additional language that is not present in the section, and produces a result that is inconsistent with the scheme and purpose of the Construction Act.[10] Justice Penny held that Section 78(2) provided priority to a mortgage taken with the intention to secure the financing of an improvement “to the extent of a deficiency” in the owner’s holdback.[11] As such, there is only one holdback available for lien claimants regardless of the number of building mortgages registered on the property.

Furthermore, the Court emphasized that when read as a whole, the Construction Act does not have any underlying policy directed solely to protect lien claimants. Referencing RSG Mechanical Incorporated v. 1398796 Ontario Inc., the Court held that there was no suggestion that the interests of lien claimants should be favoured above the interests of mortgagees beyond the value of the holdbacks the legislation requires.[12]

Ontario Court of Appeal Decision
The lien claimants appealed the Ontario Superior Court’s decision and argued that as the matter is one of statutory interpretation of the Construction Act, the lien claimants argued that the motion judge’s decision and reasoning was incorrect.
In reviewing the lower court’s decision, the Court of Appeal found that the motion judge correctly identified and applied the purposive and contextual approach to statutory interpretation and determined that there was no error in the motion judge’s application of the rules of statutory interpretation.[13] As such, the appeal is dismissed.

Conclusion
This case provides greater clarity for lenders engaged in construction financing with regards to the extent of holdback priority in situations with multiple building mortgages. As the cost of construction increases, especially following the COVID-19 pandemic, it is crucial for lenders to ensure that owners are continuing to maintain the appropriate holdback amount in accordance with the Construction Act. As it stands for now, lien claimants are only entitled to one holdback fund, irrespective of the number of building mortgages registered on the property.
If you have any questions about construction law in general, please contact Christopher Statham at 416-446-5839 or christopher.statham@devrylaw.ca.

This blog was co-authored by student-at-law, Abby Leung

[1] 2023 ONCA 1 [BCIMC].
[2] R.S.O. 1990, c. C.30 [Construction Act].
[3] 2022 ONSC 2326 [2022 ONSC 2326] at para 3.
[4] Construction Act, supra note 2 at s.22(1).
[5] Ibid at s.78(1).
[6] Ibid at s. 78(2).
[7] [1999] O.J. No. 3714 (S.C.).
[8] 2022 ONSC 2326 supra note 3 at para 16.
[9] Ibid at paras 17-18.
[10] Ibid at para 20.
[11] Ibid at para 21.
[12] Ibid at para 28.
[13] BCIMC, supra note 1, at paras 13-14.

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Ambiguity in contracts can arise for a variety of reasons, including but not limited to a lack of clarity due to poorly defined terms, multiple interpretations, vagueness, changes in circumstances, and language barriers.

The courts have historically relied on the Parol Evidence Rule, a common law rule of evidence that restricts the admission of extrinsic evidence outside of the written contract. If the Courts are required to intervene to resolve the ambiguity, the rule precludes admission of evidence outside the words of the written contract that would add to, subtract from, vary, or contradict a contract that has been wholly reduced to writing.

Furthermore, there is a longstanding, traditional rule that evidence of pre-contractual negotiations is inadmissible when interpreting a contract.

The Landmark Case of Sattva

In the case of Sattva Capital Corp. v Creston Moly Corp., 2014 SCC 53 (“Sattva”), the Supreme Court of Canada clarified the principles of contract interpretation. The case arose from a dispute over the date to evaluate a share price in determining a finder’s fee to be paid by Creston Moly to Sattva Capital.

The SCC ruled that the objective of contractual interpretation is to determine the meaning of the contract, not just individual words, or phrases in isolation. It also held that the surrounding circumstances, including the background knowledge of the parties, are important factors in determining the parties’ intentions.

Specifically, the Court Stated:

“The consideration of the surrounding circumstances recognizes that ascertaining contractual intention can be difficult when looking at words on their own, because words alone do not have an immutable or absolute meaning.”

In addition, the Court found that consideration of the surrounding circumstances does not offend the Parol Evidence Rule:

“The Parol Evidence Rule does not apply to preclude evidence of the surrounding circumstances. Such evidence is consistent with the objectives of finality and certainty because it is used as an interpretive aid for determining the meaning of the written words chosen by the parties, not to change or overrule the meaning of those words. The surrounding circumstances are facts known or facts that reasonably ought to have been known to both parties at or before the date of contracting; therefore, the concern of unreliability does not arise.”

Corner Brook (City) v Bailey: Building Upon Sattva

Fast-forward to 2021, the Supreme Court in Corner Brook (City) v Bailey, 2021 SCC 29 (“Corner Brook”), was charged with the interpretation of a release that was signed by an employee who had been injured on the job.

The decision re-affirmed several principals that came about in Sattva:

•Surrounding circumstances are relevant in interpreting a contract; and
•The nature of the evidence that may be considered will vary from case to case; and
•The purpose of considering surrounding circumstances is to aid in the interpretation of the agreement – not to add to, contradict, dispute or overwhelm the words of the agreement.

The Court also referenced Justices Côté and Brown’s dissent in the case of Resolute FP Canada Inc. v Ontario (Attorney General), where they deliberated over the traditional rule that evidence of negotiations is inadmissible with the approach from Sattva which directs courts to consider the surrounding circumstances in interpreting a contract, citing difficulty in drawing a principled distinction between the circumstances surrounding contract formation and negotiations.

In regard to pre-contractual negotiations, Justice Rowe stated:

“I leave for another day the question of whether, and if so, in what circumstances, negotiations will be admissible in interpreting a contract. That issue needs to await a case where it has been fully argued and is necessary in order to decide the appeal.”

The Supreme Court “left the door open” as to the admissibility of pre-contractual negotiations in the interpretation of a contract.

OFNLP: ONCA Considers Pre-Contractual Negotiations in Decision

In Ontario First Nations (2008) Limited Partnership v Ontario Lottery and Gaming Corporation, 2021 ONCA 592 (“ONFLP”), the Court of Appeal reaffirmed the principals in Sattva and clarified Corner Brook.

The Court of Appeal considered an arbitration panel’s use of evidence of pre-contractual negotiations as an aid to interpret the financing agreement pertaining to the operation of a casino. The Defendants, Ontario and OLG, asserted that the appeal judge and majority erred in law by admitting the pre-contractual negotiations into evidence.

When determining whether the appeal judge had ignored the entire agreement clause and allowed the extrinsic evidence (including the pre-contractual negotiations) to overwhelm the words of the agreement in question, Justice Jamal stated:

“I do not agree with this submission. An entire agreement clause alone does not prevent a court from considering admissible evidence of the surrounding circumstances at the time of contract formation. As already noted, the surrounding circumstances are relevant in interpreting a contract exactly because “words alone do not have an immutable or absolute meaning”: Sattva, at para. 47.”

and

“…I see no error in how the surrounding circumstances were considered. These circumstances helped to place the Agreement in its proper setting and understand the genesis of the transaction, the background, and the context. They included the parties’ history of litigation over revenue sharing; their shared objective of locking‑in three identified revenue streams to ensure stable, predictable, long-term funds for First Nations’ communities; and Ontario’s commitment not to convert revenues received to the final account of the Province into revenues that were not. Such evidence was admissible to show the parties’ objective mutual intention and the background facts leading to the Agreement. In my view, the surrounding circumstances were not used to overwhelm the words of the agreement or to deviate from the text to create a new agreement…”

ONFLP confirms that pre-contractual negotiations can be an important factor in interpreting a contract, particularly where the contract is ambiguous or where there is uncertainty about the parties’ intentions.

Conclusion

The decisions of Corner Brook and OFNLP have built upon the principals established in Sattva and have opened the door to the use of pre-contractual negotiation as surrounding evidence to aid in the interpretation of ambiguous contracts. Regardless of the reason for ambiguity, it is important for parties to carefully review and clarify contract terms before entering into an agreement, to minimize the risk of future disputes or misunderstandings.

For more information regarding commercial litigation, contract interpretation and corporate law, please contact Kelli Preston at Devry Smith Frank LLP at (416) 446-3344 or kelli.preston@devrylaw.ca.

This blog was co-authored by Owais Hashmi*

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Recently, the Ontario Court of Appeal ordered a spouse to pay his spouse over a million dollars, but not in relation to property division nor child support, nor spousal support. The husband had to pay those amounts in addition to over a million dollars that the Court ordered him to pay to his ex-wife to cover her legal fees. Yes, courts can order one spouse to pay all the costs for the divorce and surrounding litigation. Doing the right things after separation, and in Family Court can create big savings for a separated spouse, while denying a “big win” for his or her ex.

There can be a lot of anger and other emotions in separation and divorce. Some separated spouses head to a lawyer’s office, or to Family Court, in the hope that they can force their ex to live in a box under a bridge. Some even expect that if they spend exorbitantly on legal fees for an aggressive lawyer, they can force their spouses and children into homelessness. However, if a judge believes that is a spouse’s goal, the efforts can have the opposite of the intended result.

The recent Ontario Court of Appeal decision in Lakhtakia v. Mehra is not the first time that the Court has ordered one spouse to pay the other spouse’s legal and accountant fees totalling several hundred thousand dollars, even when doing so would cause financial hardship. Ontario Judges, especially Family Court Judges, will make a spouse whom a judge believes has acted unreasonably to pay all of their ex’s expenses in relation to the divorce, child custody or support proceedings. Rule 24(4) of the Family Law Rules authorizes such Orders. The rationale for this rule is, in part, to discourage separated spouses from acting vindictively towards each other, or to reward a spouse from acting appropriately when his or her spouse is not. It is also because these types of behaviours result in more court appearances, both conferences and motions, which not only increase the party’s legal fees and delay the matter, but clog up the court system. Judges feel that parties who do so should provide compensation for wasting everyone’s time.

Spouses who want to make things difficult for their exes often believe that their strategies are innovative and undetectable by the Court. However, judges, all of whom are former lawyers, sit in court everyday, often hearing multiple matters every day, and possibly thousands of matters every year. They have seen many, many attempts to create unnecessary difficulties, and the negative consequences for all involved.

In Lakhtakia v. Mehra and Knight v. Knight, the Court of Appeal set out many of the more common tactics that Family Court Litigants try use to gain advantage over their exes, but they frequently backfire:

refusing or trying to hide necessary financial disclosure
misleading the court, especially in relation to financial matters where objective evidence may disprove the representations.
refusing to negotiate or making unreasonable offers to settle
either bringing needless motions, or forcing the other party to bring motions to get compliance with existing obligations under the Family Law Rules
withholding the children or otherwise using the children to get leverage in negotiations
refusing to pay appropriate child support immediately, even on admitted income – judges see this as an attempt to improperly get leverage by causing financial distress
otherwise running up the opposing party’s fees and expenses unnecessarily
refusing to follow court orders
trying to intimidate the other party through threats of embarrassment, financial difficulties or physical force

Judges who see a separated spouse or parent using these types of tactics will not hesitate to order them to pay all the legal fees and expenses that the other party incurred to rectify the situation.

In the March 2021 changes to the Family Law Legislation, the Federal and Ontario Governments created specific laws to stop separated parties, and especially parents, from engaging in activities that are only designed to harm a former spouse or co-parent. Under section 7.2 of the Divorce Act and section 33.1(2) of the Children’s Law Reform Act, parents have a specific legal duty to protect their children from any conflict related to the separation. Those new laws also require separated spouses and parents to try to resolve matters through negotiation or alternative dispute resolution and avoid Family Court wherever possible. Judges really do expect people to treat each other civilly and try to resolve matters on a reasonable basis after they separate. Serious consequences, including hefty orders for the payment of costs to the other party, are the result when someone choses to be vindictive, or even unreasonable.

Separated spouses and parents who want to get the best of their former partner in Family Court need to find an excellent Family Law Lawyer, and listen to that lawyer’s advice. The road to success does not involve underhanded, coercive, or dishonest tactics. Judges are likely to pick up on those and punish he guilty party. The best strategy to see an ex beaten down, if not destroyed, in Family Court, is to be seen as the reasonable, cooperative, caring party while allowing the other party to seem mean or vindictive. This does not mean rolling over and giving away everything – judges don’t think that is reasonable either. But it does mean getting some advice from a lawyer about how to appear reasonable while working towards the best possible outcome. That can be a difficult tightrope walk, especially in the winds of emotion that come after separation. The best lawyers will tell you what the realistic outcomes are, and how best to achieve them, which may involve avoiding Family Court all together, rather than going on an aggressive attack that is doomed not only to failure but to result in serious repercussions, maybe even an easily avoidable costs award of thousands, or millions of dollars, to help a former partner.

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In the recent case of Convoy Supply Ltd. v. Elite Construction (Windsor) Corp., the Plaintiff, Convoy, brought a motion for a determination that the debt owing by the Defendants, Elite Construction, and Kostas Michos, the officer, director, guarantor, and directing mind of Elite Construction, survives Kostas’ bankruptcy pursuant to section 178(1)(d) (the “Section”) of Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, (the “BIA“).

Section 178(1)(d) states:

An order of discharge does not release the bankrupt from any debt or liability arising out of fraud, embezzlement, misappropriation, or defalcation while acting in a fiduciary capacity or, in the Province of Quebec, as a Trustee or administrator of the property of others.

FactsConvoy supplied construction materials to Elite Construction for which payment was not made. On July 28, 2020, Convoy filed a claim against Kostas’s company and Kostas himself, seeking payment of $92,412.15 in damages for breach of trust, among other things. The claim was made pursuant to the Construction Lien Act (“CLA”) and the Construction Act (“CA”). The claim alleged that Kostas and his company had failed to pay for the materials and had therefore been unjustly enriched. Kostas was also accused of diverting or converting the trust funds for their own use.

On December 14, 2021, Kostas made an assignment into bankruptcy. He deposed that he chose to make an assignment into bankruptcy rather than bring a motion to set aside the judgment because he had no reason to believe the judgment would survive his bankruptcy.

Kostas submitted that he is only deemed to admit a breach of trust, and a breach of trust is insufficient to trigger the Section. Kostas argued that Convoy must additionally show that the debt arose from some element of “moral turpitude or dishonesty.” The deemed admission that the trust funds were appropriated or converted contrary to trust obligations does not necessarily imply “misappropriation and defalcation” under the Section. Kostas further argued that in the absence of moral turpitude or dishonesty, the Court cannot vary the judgment to include a declaration under the Section.

AnalysisThe Court ruled that Kostas was deemed to admit the Breach of Trust Facts, which included that he assented to and acquiesced in the diversion of trust funds established under the CA for purposes inconsistent with the trust. Similarly, directing trust funds for a purpose inconsistent with the trust is also sufficient to trigger the Section and such diversion is considered “dishonest”.

The Court found that Kostas was acting in a fiduciary capacity. As sole officer and director of Elite Construction, Kostas failed to adequately discharge his onus as a Trustee to account for the relevant trust funds pursuant to the CA. Goodman J. determined that Kostas’ deemed admissions establish the type of “wrongdoing, improper conduct or improper accounting” contemplated by the Section.

HeldThe Court granted the Plaintiff’s motion, stating that Kostas’s debt to Convoy still existed, and an order was made for Kostas to pay Convoy $92,412 for damages, $7,000 for punitive damages, and $4,790 for costs, and determined that prejudgment and post-judgement interest would survive the bankruptcy.

The Order also stated that the judgment debt would not be discharged in the event of Kostas’s bankruptcy and that Kostas was found to have used trust funds in an inconsistent way and failed to account for them as a Trustee.

For more information regarding Bankruptcy, Collections, Fraud, and/or Trusts related topics, please contact Kelli Preston at Devry Smith Frank LLP at (416) 446-3344 or kelli.preston@devrylaw.ca.

This blog was co-authored by Owais Hashmi*

Sources:

Convoy Supply Ltd. v. Elite Construction (Windsor) Corp., [2022] O.J. No. 4186, 2022 ONSC 5353

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Wills are useful legal tools for deceased individuals to unequivocally communicate their last wishes. Most commonly, such wishes include funeral arrangements, how assets of the estate should be distributed, and the names of estate trustees (those responsible to execute the Will’s instructions). It remains true that it is not necessary for a lawyer to draft the Will for it to be legally enforceable. However, a lawyer’s contribution ensures that the Will is drafted appropriately for the estate to be administered and dealt with according the wishes of the deceased, and in accordance with appliable laws. This is especially true if an individual intends to exclude certain persons from being beneficiaries or wishes to donate some of their estate to a charitable organization..

Often, individuals pass away without leaving behind a valid and unambiguous Will. This can be the situation if the individual did not create a Will before passing, or had left a Will, but one that is not valid according to given legal principles. In both examples, that individual is considered to have died “intestate” – and the distribution of the estate will be in accordance with the rules of intestacy.

There is an additional caveat worth noting; it is possible for the deceased to be deemed to have died intestate, even having left behind a valid Will. This might be the case if the individual has failed to address the distribution of all the assets of the estate, has listed a person as a beneficiary who has predeceased the individual, or has provided for a benefit to an organization that no longer exists. These examples are referred to as a ‘partial intestacy’. Accordingly, the Will governs the distribution of the deceased’s estate to the extent of the validity of the Will, and the statute (the Succession Law Reform Act (the “Act”)) governs the remaining portion.

The rules of intestacy are numerous, and they are nuanced. For this reason, this article provides a high-level discussion of only the most common circumstances – when the intestate individual was single, a common law spouse, or a married spouse. Part 2 of the Act deals with distribution on intestacy.

Single Persons and Common Law Spouses

In Ontario, only a person of the same or opposite sex who was married to the deceased is entitled to inherit from the deceased’s estate under the Act (s. 1(1)). Common law spouses have no statutory entitlement to the deceased’s property. The same holds true for married spouses who were separated at the time of the deceased’s death (s. 43.1), which came into effect January 1, 2022. In such situations, the distribution of the estate will ‘trickle down’ to the next of kin – children, grandchildren, and so on. The definition of spouse in the Act (s.57) has been expanded to include two people who are not married but have cohabitated continuously for three (3) years, have some permanence, and are parents of a child. Subsequently, common law spouses can apply to become the personal representative of the estate. A common law spouse can also bring an application for support if s/he is a dependant spouse.

Married persons
Spouse and No Issue

If the diseased has died leaving behind a married spouse, and no issue (a term used to encompass children born within the marriage, outside of marriage, and adopted children), then the surviving spouse will inherit the estate absolutely (s. 44).

Spouse and Issue

If the deceased individual has left behind issue, then the spouse is entitled to a ‘preferential share’ (s. 45) plus a portion of the residue. Currently, the preferential share amount is $350,000 in Ontario (O. Reg. 54/95). If the estate is less than this amount, then the spouse is entitled to the estate absolutely (s. 45(1)) regardless of the amount of issue. However, the application of this rule can become more caveated if the individual has died partially intestate. In this case, the spouse’s entitlement of the preferential share is reduced by the amount, if any, she/he received under the deceased’s Will. Similarly, where a spouse is entitled to less than the preferential share under the Will, the spouse will get ‘topped up’ to the preferential share amount from the portion of the estate that is intestate.

If the value of the estate is greater than the amount of the preferential share owed to the spouse, the spouse will be entitled to the full amount of the preferential share plus a distributive share of the remaining portion of the estate. The distributive share will depend on the amount of issues the deceased left behind. If the deceased only left behind one child, then the amount remaining will be divided equally between the spouse and issue (s. 45(2)). If there are two children, the amount remaining will be divided into three portions (1/3 for spouse, and 1/3 to each of the children) (s. 45(103)), and so on.

In practice, the application of these rules depends on a number of factors. An intestate individual who was pre-deceased by an issue or left behind an issue who was financially dependent on the individual for health reasons, are examples of situations that can affect the division of the estate. It is important to speak to a Wills and Estates lawyer to ensure that your estate is administered according to your desire. To schedule a consultation please contact Dayna Devonish – Montique at (705) 526 – 9325, ext 203, or by email dayna@prostlaw.com.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such, If you require legal assistance, please see a lawyer. Each case is unique and lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs”.

The post If You Do Not Make a Will, the Government Will Make One for You first appeared on Devry Smith Frank LLP.

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In its April 2021 budget the Trudeau government proposed a new tax on vacant residential properties owned by nonresidents. According to the budget document “This will help to ensure that foreign, non-resident owners, who simply use Canada as a place to passively store their wealth in housing, pay their fair share.” Finance Minister Chrystia Freeland told reporters at the time “The idea here is that homes are for Canadians to live in, they are not assets for parking offshore money.”

The Underused Housing Tax Act passed in June of 2022 and introduced an annual 1% tax on the targeted properties. The tax is retroactive to calendar years commencing January 1, 2022. The Canada Revenue Agency published technical details as well as the form of the return on January 31st, 2023.

Unfortunately, the legislation has a far greater impact than simply taxing “foreign, non-resident owners” who are “parking offshore money” in Canadian residential real estate. Every Canadian partnership, private corporation and trust which holds title to residential properties MUST file a return each year for each property held on December 31of any calendar year. The filing deadline is the same for all entities regardless of their tax year-end date – April 30 of the subsequent calendar year. Failure to file a return results in a minimum penalty of $5,000 for individuals and $10,000 for corporations for each property. The penalty applies even if the property is not subject to the 1% tax. If the property is taxable, a percentage of the tax may be added to the penalty.

In order for a corporation or partnership to file a return, it must first register for an “RU” extension to its Business Number. CRA has indicated that registration will be possible after February 6, 2023. Non-residents who are required to file a return must first obtain an Individual Tax Number from CRA.

Individuals who are Canadian citizens or Permanent Residents as defined in the Immigration and Refugee Protection Act, governments, publicly listed companies, REITs, charities, co-ops, mutual funds, municipal governments, schools and some other entities are exempt from both the requirement to file a return and from the tax itself.

Every Canadian private corporation, partnership and trust holding residential property on December 31 in a year is required to file a return whether or not tax is payable. A corporation is only exempt from taxation if more than 90% of its shares are held by Canadian citizens or residents. In the case of partnerships holding residential property, the exemption is only available if all of the partners are Canadian citizens or residents. Similarly, in the case of a trust, the threshold is that all of the beneficiaries are Canadian citizens or residents. Many trusts, particularly testamentary trusts – trusts created by a will – may have non-Canadian beneficiaries.

Estate trustees must file a return if the estate assets included a residential property on December 31. There is a potential impact on testamentary trusts as the exemption from taxation only applies to the year in which the testator died and the subsequent year. Cottages or other residential property held through a family trust or cottage trust also trigger the filing requirement.

It cannot be over-emphasized that there is no exemption from the penalties for failure to file a return for each residential property so owners of private corporations, partners in partnerships, trustees, and executors need to be vigilant if any of the assets of these entities meet the definition of residential property in the Act.

Residential property is described as follows: residential property means property (other than prescribed property) that is situated in Canada and that is

(a)a detached house or similar building, containing not more than three dwelling units, together with that proportion of the appurtenances to the building and the land subjacent or immediately contiguous to the building that is reasonably necessary for its use and enjoyment as a place of residence for individuals;
(b)a part of a building that is a semi-detached house, rowhouse unit, residential condominium unit or other similar premises that is, or is intended to be, a separate parcel or other division of real or immovable property owned, or intended to be owned, apart from any other unit in the building together with that proportion of any common areas and other appurtenances to the building and the land subjacent or immediately contiguous to the building that is attributable to the house, unit or premises and that is reasonably necessary for its use and enjoyment as a place of residence for individuals; or
(c)a prescribed property

Whether or not a property is “owned” is based on whether it holds legal title or a lease, it is not based on beneficial ownership.

Whether or not the tax applies depends on a number of factors set out in the Act which determine whether the property is “underused” in the year. It should be noted however that there is no exemption from taxation for properties that meet the statutory definition of residential property and are not vacant, but are used for non-residential purposes such as offices, hotels, or vacation rentals.

If you are an executor trustee or partner or have an interest in a private corporation, partnership or trust that holds residential property you should be prepared to register and file a return, or obtain professional assistance in doing so. Remember that the UHTA is reported on a calendar year basis, so corporations will have to file by the end of April each year even if they have an off-calendar year-end. The filing deadline for this year is May 1st, 2023 as April 30 falls on a Sunday.

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An employer being defrauded by an employee is often faced with a difficult problem: how to gather information about the fraud and the location of stolen assets, including money, before the employee takes steps to destroy evidence and dissipate or hide misappropriated assets?

To address this problem, Ontario courts may compel an innocent third party to disclose otherwise confidential information about a client, including his or her assets as well as the history and use of bank accounts and credit facilities. It does so by way of a “Norwich order”, named after a British case, which permits the victim to obtain information from third parties for the purpose of proving a fraud, identifying the wrongdoer, and recovering stolen property.

An application for a Norwich order can be brought without notice, may be heard in a closed courtroom and will often be joined with confidentiality orders, including one which seals the court file for a certain period, so as to avoid tipping off the wrongdoer.

The order is, however, an extraordinary one, requiring the following:

that the applicant for it show that the fraud claim is valid, bona fide and not frivolous or vexatious;
that the third party from whom information is being sought is “involved”, even innocently, as will be the case with a bank holding, without knowing, stolen funds on deposit;
that the third party is the only practicable source for the information being sought;
that the applicant indemnify the third party for the costs associated with compliance with the order; and
that after weighing the interests of and potential injury to the parties involved, the court is satisfied that it is in the interests of justice that the order be made.

Once granted, a Norwich order can be a powerful tool. With it, an employer can gather information that will often be critical to unraveling a fraud and determining where stolen property has gone – ideally well before the wrongdoer knows that he or she has been found out. The employer can then take steps to try to freeze assets and to preserve evidence.

The post Norwich Orders: A Powerful Tool For Gathering Evidence and Locating Stolen Assets first appeared on Devry Smith Frank LLP.

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A recent headline in the Toronto Sun caught my eye: Homeowners urged to get title insurance after Etobicoke real estate fraud.[1] The related article tells the tale of unknown individuals who allegedly impersonated the owners of a home and sold it while the owners were away. The story includes a recommendation from Tim Hudak, of the Ontario Real Estate Association, to get title insurance for your home.

In addition to being the place where you live and raise your family, the home is often your largest single asset. What do you do if you find out one day that the registered owner of it is someone whom you have never heard of or that there is now a whopping $500,000 mortgage on it to which you did not agree? How do you navigate trying to undo the fraud? Reporting the matter to the police can be important, but it will not reverse the fraud.

Having title insurance which insures your property against fraud may be the answer. We often get retained by title insurers to take the legal steps necessary to fix or delete fraudulent transfers and fraudulently registered mortgages, the consequence of which could otherwise be devastating.

So, what is title insurance? In general terms, it is insurance to protect property owners and lenders against certain losses related to the property’s ownership and interests in it. It is available in Ontario from several insurers, including FCT,[2] Stewart Title Guaranty Company,[3] Chicago Title (Canada),[4] and TitlePLUS.[5]

What does it cover? The title policy in question will set out what insurance is provided. Generally speaking, however, title insurance will cover, among other things, fraudulent registrations against the property, unknown title defects which may affect ownership, some liens, encroachments and right-of-way issues, and errors in surveys and public records.

What does title insurance cost? Like other insurance, you need to pay a premium to obtain it. Unlike most other types, the premium is a one-time payment, usually a few hundred dollars, and, best of all, the insurance normally continues as long as you own the insured property.

Mr. Hudak’s recommendation constitutes good advice. Every homeowner should, at the very least, consider title insurance. A good place to start is to ask your lawyer about it, especially before you buy your home.

The post Homeowner Beware: A Reminder That You Should Consider Title Insurance For Your Home first appeared on Devry Smith Frank LLP.

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By Dayna Devonish-Montique and Abby Leung

Individuals who were convicted of a minor or serious criminal offence may be considered inadmissible to enter Canada. However, individuals can overcome this criminal inadmissibility either by applying for criminal rehabilitation or a record suspension/pardon. This blog will detail the requirements for both processes to determine eligibility to enter Canada.

Criminal Rehabilitation

Under Canada’s immigration laws, individuals who have committed or have been convicted of a minor or serious crime outside Canada may not be allowed to enter Canada and are considered “criminally inadmissible”. Depending on the crime, how long ago the crime was committed, and the individual’s behaviour since the crime was committed, individuals may still be allowed to come to Canada under this category if they are deemed rehabilitated or if an immigration officer approves an application for criminal rehabilitation.

Deemed rehabilitation under Canada’s immigration laws means that enough time has passed since the crime was committed so that the individual’s criminal history does not bar entrance to Canada. Individuals are eligible to apply for deemed rehabilitation at a port of entry if the individual only had one conviction in total or committed only one crime, at least ten years have passed since the completion of all sentences, the crime committed is not considered a serious crime in Canada, and the crime did not involve any serious property damage, physical harm to any person, or any type of weapon. If an applicant believes that they are eligible, they must provide required documents including a recent police certificate from the country they were convicted in, along with court documents for each conviction, a recent criminal record check, and a passport or birth certificate. If deemed rehabilitated, applicants will be allowed to enter Canada, provided that they meet additional requirements for entry such as visitor visa requirements. Any request for deemed rehabilitation is not guaranteed to be approved.

If an individual is not eligible to apply for deemed rehabilitation, they may apply for criminal rehabilitation if the criminal act occurred outside of Canada and if five years have elapsed since the act or since the end of the sentence imposed. An application for criminal rehabilitation for a US applicant requires submitting a state police certificate, an FBI police certificate, documents relating to the sentence imposed, and court judgments that demonstrate the charge/s, the verdict, and the sentence imposed, among other documents.

If an individual needs to travel to Canada but cannot apply for rehabilitation because five (5) years have not passed since the end of the sentence imposed or are not eligible to apply for a record suspension, they must request special permission to enter or remain in Canada. After reviewing the application, an immigration officer may advise that the applicant could apply for special permission (temporary resident’s permit) to enter Canada, or to advise that they do not recommend that the applicant travel to Canada.

Record Suspension (Pardon)

A record suspension (previously called pardon) allows people who were convicted of a criminal offence but have completed their sentence and demonstrated that they are law-abiding citizens to have their criminal record kept separate and apart from other criminal records. A record suspension has the effect of removing a person’s criminal record from the Canadian Police Information Centre (CPIC). However, a record suspension does not erase a convicted offence nor guarantees entry or visa privileges to another country. A record suspension can be revoked or cease to have effect if the applicant is convicted of a new indictable offence, is found to no longer be of good conduct, found to have made a misleading statement, or is found ineligible for a record suspension at the time the record suspension was ordered. If a record suspension is revoked or ceases to have effect, the record of offence is added back to CPIC. An applicant may apply for a record suspension if they were convicted of an offence in Canada under a federal act or regulation of Canada as an adult and/or were convicted of a crime in another country and were transferred to Canada while serving that sentence under the International Transfer of Offenders Act. An applicant does not need to apply for a record suspension if the applicant only received an absolute or conditional discharge, or were only convicted in a youth court or youth justice court.

To apply for a record suspension, an applicant must have completed all of their sentences which includes all fines, costs, restitutions, sentences of imprisonment, conditional sentences, probation orders, etc. The waiting period begins after an applicant has completed all of their sentences. The following table provides a short summary of the waiting periods:

| Date | Waiting Period | | Before June 29, 2010 | · 5 years – an offence prosecuted by indictment· 3 years – an offence punishable on summary conviction | | Between June 29, 2010 and March 12, 2012 | · 10 years – serious personal injury offence including manslaughter, an offence where an individual was sentenced to a prison term of 2 years or more, and an offence referred to in Schedule 1 that was prosecuted by indictment· 5 years – any other offence by indictment and an offence referred to in Schedule 1 that is punishable on summary conviction· 3 years – an offence other than the ones mentioned above, that is punishable on summary conviction. | | On or after March 13, 2012 | · 10 years – an offence prosecuted by indictment· 5 years – an offence that is punishable on summary conviction. |

If eligible to apply, applicants can apply directly to the Parole Board of Canada (PBC) for a Record Suspension. Applicants must provide their criminal record, court information for each of their convictions, local police record checks, and documents to support identification, among other forms.

Conclusion

While criminal rehabilitation and record suspensions appear similar on its face, an important difference is that criminal rehabilitation focuses on criminal offences committed outside Canada while record suspensions focus on criminal offences committed within Canada. When the conviction is inside Canada, rehabilitation is not an option and applicants can apply for record suspension. Conversely, when the conviction is outside Canada, record suspension is usually not an option (unless convicted of a crime in another country and were transferred to Canada while serving that sentence under the International Transfer of Offenders Act) and applicants can apply for rehabilitation. Important to note, if an individual committed offences both inside and Canada and, they require both an approval of rehabilitation and a record suspension in order to be admissible to Canada. The request for criminal rehabilitation cannot be made until a record suspension is first approved, unless the individual has only one (1) summary conviction offence in Canada.

If you have any questions related to your immigration law matter, please visit our website or contact Dayna Devonish-Montique at Devry Smith Frank LLP at 705-526-9328 ext 101 or at dayna@prostlaw.com.

This blog was co-authored by student-at-law, Abby Leung

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On January 3, 2023, Immigration Refugees and Citizenship Canada (IRCC), the federal department responsible for the processing of immigration applications, announced that Canada welcomed over 437,000 new immigrants in 2022.[1] This number is higher than the target set at 431,645 new immigrants in Canada by the end of 2022, and marks a new record for the number of Canadian permanent residence admissions in one year, breaking the previous record of over 405,000 new immigrants in 2021.[2]

In achieving this record, IRCC credits new technology, streamlined processing, and the use of online applications. IRCC processed over 4.8 million applications across all lines of business in 2022 which includes applications for permanent residence, temporary residence, and citizenship. This is double the number of applications processed in 2021.[3]

IRCC has emphasized the importance of immigration as a key part of Canada’s long-term economic growth plan. Economic migration addresses labour shortages and stimulates the Canadian economy by providing government and business with critical workers. Shortages of skilled workers in industries such as healthcare, manufacturing, building trades and STEM (Science, Technology, Engineering and Math) are acute and require a high number of skilled immigrants and workers to fill these positions. New features in Express Entry will target qualified immigrants in these sectors. Additional measures to promote economic growth include regional programs to address labour needs and in-demand skillsets for small towns and rural communities.

IRCC has also struggled to keep up with the backlog of applications resulting from the COVID-19 pandemic. As pandemic-related restrictions eased, the number of processed applications steadily increased in 2022, with the federal government moving forward with its plan to boost the number of immigrants in Canada. The immigration levels plan for 2023-2025 sets an ambitious target of welcoming approximately 500,000 new permanent residents each year by 2025, with a target of 465,000 new immigrants for 2023.[4] As IRCC continues to add more resources, streamline processing, and expand its programs, immigration will remain a priority in achieving Canada’s economic goals.

This blog was co-authored by student-at-law, Abby Leung

[1] https://twitter.com/CitImmCanada/status/1610403133355659264

[2] https://www.canada.ca/en/immigration-refugees-citizenship/news/2022/12/canada-welcomes-historic-number-of-newcomers-in-2022.html

[3] https://www.canada.ca/en/immigration-refugees-citizenship/news/2022/12/canada-marks-record-breaking-year-for-processing-immigration-applications.html

[4] https://www.canada.ca/en/immigration-refugees-citizenship/news/notices/supplementary-immigration-levels-2023-2025.html

The post Welcome to Canada: Canada Grants Unprecedented Number of Permanent Residency Permits in 2022 first appeared on Devry Smith Frank LLP.

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Wills are a powerful tool that people can use to ensure that their families and loved ones are cared for after they pass away. The purpose of a Will is to convey the Testator’s wishes regarding the distribution of their properties and assets.

Although not mandatory, Wills are often drafted by a lawyer. For a Will to be validly executed, section 4(2) of the Succession Law Reform Act, R.S.O., 1990, c. S.26 (“SLRA”) states that a Will must be signed at its end by the Testator (or some other person in the Testator’s presence by the Testator’s direction) in the presence of two or more attesting witnesses who will also subscribe the Will at the same time. More specifically, in order for the Will to be deemed valid in Ontario, the SLRA requires the two witnesses to be present when the Testator signs and dates the Will.

Due to the COVID-19 pandemic, several provinces have implemented virtual witnessing of legal documents. Effective August 1, 2020, O. Reg. 431/20 was enacted to permit remote commissioning in Ontario. In order for Wills to be witnessed remotely and in counterpart, at least one of the witnesses must be a lawyer licensed by the Law Society of Ontario. “Remote witnessing” means that the signing of Wills can be completed with audio-visual communication technology. “In counterpart” means the witnesses can sign their respective copies of the Will. Furthermore, all the signed copies must be kept together in order to finalize the Will. Wet signatures on paper documents are still required in Ontario.

Such Wills are known as a “Formal Will”. A Formal Will is the best way to convey the individual’s wishes and intentions regarding their Estate.

Requirements for Formal Wills

The Will must be created by an individual of sound mind, and over the age of majority in Ontario (age of 18);
The Will must be made by the Testator – no one else can make it on their behalf;
The Will must be signed in the “presence” of two valid witnesses;
- A witness should not be a beneficiary or the spouse or parent of any beneficiary;
The witnesses must sign the last page of the Will together with the Testator;
The Will must be signed in “wet ink” (a pen, seal, or other identifying mark) and stored as a physical copy.

The second kind of Will recognized in Ontario is known as a Holographic Will. According to section 6 of the SLRA, a Testator may make a valid Will wholly by his or her own handwriting and signature, without formality, and without the presence, attestation or signature of a witness.

Requirements for Holographic Wills

The Holographic Will must wholly be the handwriting of the Testator;
The Holographic Will must be signed by the testator at the end of the document;
The Holographic Will must contain a “deliberate or fixed and final expression of intention as to the [Testator’s] disposal of property upon death”;
Any gifts ‘below’ the signature are NOT be valid;
Holographic Wills do not require witnesses;
Holographic Wills do not require a date (although this can be very helpful).

Changes to Existing Wills

A Codicil is a legal document that is used to make minor modifications to an already existing Last Will and Testament. A Codicil has the same signing requirements as a Formal Will. In order to create a Holographic codicil, the entire amending document must be handwritten, with the date and signatory at the end of the document.

Codicils are typically used for the purposes of changing the name of an executor, guardian, or beneficiary, or adding or deleting specific bequests. It is generally not recommended to have more than one Codicil to your Will as multiple documents may lead to a misinterpretation of the Testator’s intentions.

The Case of Lacroix Estate, 2021 ONSC 2919

The Testator, Rebecca Lacroix, instructed solicitor Margaret Opatovsky to prepare her Will while she was hospitalised with late-stage cancer in 2020. Due to COVID-19 restrictions, Opatovsky was unable to visit Lacroix in the hospital to have the Will properly executed. Consequently, she delivered the typewritten Will to the hospital and advised Lacroix to create a Holographic Will incorporating the draft Will.

Accordingly, Lacroix stated in a handwritten note:

“I, Rebecca Stephanie Lacroix, declare that this holographic will shall constitute my last will and testament and I hereby incorporate into this my will the attached draft will which I have initialed on each page for identification purposes.”

She attached this note to the draft Will and initialed each page.

When the Estate Trustee named in the draft Will applied to the Court for a Certificate of Appointment, the Court denied the Application.

The Court examined sections 6 and 7 of the SLRA and found that the Holographic Will satisfied the requirements under the Act to be valid. However, the Holograph Will alone was not a valid testamentary document, as it did not independently dispose of any property.

Moreover, the Court noted that a Holographic Will cannot incorporate by reference a typewritten document, and the Holographic Will must be wholly in the deceased’s handwriting.

Recent Legislative Amendments

The Accelerating Access to Justice Act is a large omnibus Bill that amends various Ontario statutes and regulations, including the SLRA.

As of January 1, 2022, Schedule 9 amends the SLRA by adding section 21.1 to give the Superior Court of Justice authority to, on application, make an order validating and rendering fully effective a document or writing that was not properly executed or made under the SLRA if the Court is satisfied that the document or writing sets out the testamentary intentions of a deceased, or an intention of a deceased to revoke, alter or revive a Will. Electronic Wills form an exception to this provision.

Previously, Ontario adhered to a strict compliance regime such that the Court had no discretion in determining a document as constituting a valid Will if it did not fully comply with the requirements prescribed by the SLRA. Now, under section 21.1, improperly signed Wills are treated with more flexibility such that the Superior Court is authorized, on application, to determine a non-compliant Will valid.

It is important to note that one can only make an application under section 21.1 where the date of death of the Testator is on or after the effective date, being January 1, 2022.

Conclusion

Recent amendments to the SLRA show that the law governing Wills and testamentary documents in Ontario is gradually but steadily evolving. However, Ontario legislators should take a cue from other provinces, such as British Columbia, where digital signing of Wills by Testators is now legal. Courts should also work to clarify the law governing the inclusion of typewritten documents in Holographic Wills.

For more information regarding Wills, Trusts, and/or Estates related topics, please contact Kelli Preston at Devry Smith Frank LLP at (416) 446-3344 or kelli.preston@devrylaw.ca.

This blog was co-authored by Owais Hashmi*

The post The Laws Surrounding Formal Wills and Holographic Wills in Ontario first appeared on Devry Smith Frank LLP.

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O’Reilly v. ClearMRI Solutions Ltd., 2021 ONCA 385 (CanLII)

Under the common law Doctrine of Common Employer, multiple entities can be considered a single employer under particular circumstances. The O’Reilly case is crucial for clarifying the “common employer” doctrine in Ontario employment law. Specifically, it articulates the need to show intent to create an employer/employee relationship between the employee and the alleged common employer(s).

Overview

In October of 2014, William O’Reilly commenced a claim for six months’ wages and twelve months vacation pay against his employer(s) via myriad defendants: ClearMRI Solutions Ltd. (“ClearMRI Canada”), ClearMRI Solutions, Inc (“ClearMRI US”), Tornado Medical Systems Inc. (“Tornado”), as well as against individual directors of these corporations.[1]

All of the corporations were sued collectively as “common employers.” Tornado was the majority shareholder of ClearMRI Canada which itself had ClearMRI US as its own wholly owned subsidiary.[2] Although William did not have a written employment contract or position with Tornado, he alleged that Tornado—along with the other corporations—were all his common employers.[3] William obtained default judgment against the ClearMRI companies and successfully moved for summary judgment against the other defendants.[4] Tornado appealed.[5]

The Ontario Court of Appeal allowed Tornado’s appeal, stating that the motion judge erred in the articulation and application of the common employer doctrine.[6] In doing so, the Court of Appeal confirmed that the motion judge made an extricable error of law in concluding that Tornado was a common employer.[7]

The Lower Decision

William served as the CEO of ClearMRI Canada.[8] In 2012, William signed an agreement with ClearMRI US confirming the terms of his employment which named ClearMRI US as the employer.[9] William did not hold any formal position with Tornado.[10] Although ClearMRI US was named as William’s employer in the written agreement, the motion judge found that William was also employed by Tornado.[11]

The motion judge identified three factors that should be considered in determining whether there was a common employer: the employment agreement itself, where the effective control over the employee resides, and whether there was common control between the different legal entities.[12] Using these factors, the motion judge found that Tornado was a common employer of the plaintiff as Tornado exercised “a sufficient amount of control” over the plaintiff and found that there was common control between Tornado and the different legal entities.[13]

Tornado appealed.

Ontario Court of Appeal Decision

On appeal, the Court of Appeal determined that Tornado was not liable as a common employer. A corporation is not held to be a common employer simply because it is owned, controlled, or was affiliated with another corporation that had a direct employment relationship with the employee.[14] Rather, a corporation will be found to be a common employer only where it can be shown that there was an intention to create an employer/employee relationship between the individual and the related corporation.[15] Where there is a written employment agreement with an entity other than the alleged common employer, the court must assess how such an agreement bears on whether there was an intention to create an employment agreement with the alleged common employer.[16]

The Court of Appeal found that the motion judge failed to undertake the required analysis of the effect the written agreement had in determining whether there was intention that Tornado was a party to the employment agreement.[17] Further, the Court of Appeal found that none of the three factors that the motion judge relied on were enough to find that Tornado exercised control over the plaintiff as an employee. [18] Lastly, the Court of Appeal found that the motion judge failed to explain why the existence of a corporate relationship between Tornado and the ClearMRI companies provided an intention that Tornado was a party to the employment agreement with the plaintiff.[19]

In all, the Court of Appeal found that there was no intention between the plaintiff and Tornado to contract with Tornado as a common employer. In the absence of evidence that would show an intention to have Tornado as a common employer, the Court of Appeal allowed the appeal and set aside the summary judgment against Tornado.[20]

Analysis and Conclusion

The Court of Appeal makes it clear that whether an entity is considered a common employer is dependent on the intention of the parties in addition to factors such as the existence of an employment agreement, control over the plaintiff, and existence of a corporate relationship between the entities.

The courts will strictly interpret the application of the common employer doctrine to ensure that intercorporate relationships would not be conflated as evidence of a common employer relationship.

Employees who provide services for multiple entities should seek legal advice as they may be able to seek recovery from multiple parties. Conversely, employers should be careful of having employees perform services for or take direction from other entities unless the intention is to create a common employer relationship.

This blog was co-authored by student-at-law, Abby Leung

[1] 2021 ONCA 385 at para 26.

[2] Ibid at para 15.

[3] Ibid at para 6.

[4] Ibid at para 7.

[5] Ibid at para 8.

[6] Ibid at para 11.

[7] Ibid.

[8] Ibid at para 19.

[9] Ibid at para 20.

[10] Ibid at para 19.

[11] Ibid at para 35.

[12] Ibid at para 31.

[13] Ibid at para 35.

[14] Ibid at para 50.

[15] Ibid.

[16] Ibid at para 75

[17] Ibid at para 75.

[18] Ibid at para 86.

[19] Ibid at para 91.

[20] Ibid at para 92.

The post When can multiple entities be considered a single employer? first appeared on Devry Smith Frank LLP.

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Proposed in the Federal Budget of 2022, and passed in June of 2022, the Government of Canada has enacted the Prohibition on the Purchase of Residential Property by Non-Canadians Act[1] (the “Act”). As is made clear by the title, the Act prohibits the purchase of Canadian residential property by non-Canadians, directly or indirectly. ‘Indirectly’ refers to scenarios where a purchase is attempted through a trust, partnership, or an unincorporated association. Interestingly, the Act overrides section 34 of the Citizenship Act[2], which otherwise explicitly grants this right to non-Canadians. The Act will be enforced for a two-year period beginning January 1, 2023 and does not apply if a non-Canadian becomes liable or assumes liability under an agreement of purchase of sale of residential property before this date.[3]

To understand the extent of the application of the Act to potential purchasers, it is important to pay close attention to the Act’s definition of a “non-Canadian”. The definition is as follows:

an individual who is not a Canadian citizen, permanent resident of Canada or registered as an Indian under the Indian Act,[4]
a corporation that is not incorporated under the laws of Canada or a Canadian province,
a private corporation that is incorporated in Canada but that is controlled by a person referred to in paragraph (a) or (b) above.

In addition, “purchase” means to acquire or agree conditionally or unconditionally to acquire a legal or equitable interest, or an immovable real right in a residential property. There have been proposals to preclude certain situations under this term, specifically those pertaining to an acquisition resulting from divorce or separation, the rental of a residential dwelling unit, or an acquisition resulting from succession. These proposals are expected to be included in a set of Supporting Regulations (the “Supporting Regulations”) that will be released to provide additional detail regarding the application of the Act.

Exemptions

As is common to many laws and regulations, the Act provides for certain exemptions. These exemptions include:

temporary residents within the meaning of the Immigration and Refugee Protection Act[5] who satisfy prescribed conditions set out in the Supporting Regulations;
a refugee;
an individual who is a non-Canadian and who purchases residential property in Canada with their spouse or common-law partner if the spouse or common law partner is a Canadian citizen, person registered as an Indian under the Indian Act[6] permanent resident or person referred to in paragraph (a) or (b) above; or,
a person of a prescribed class of persons under supporting regulations.[7]

Penalties, Enforcement and Liability

Under section 6(1) of the Act, anyone who contravenes or counsels, induces, aides or abets a contravention of the Act, or attempts any of the above, is guilty of a summary conviction of a fine of not more than $10,000.

Additionally, if the offence is committed by a corporation, then any officer, director, or agent or other authorized individual that “directed, authorized, assented to, acquiesced in or participated in” the commission of the offence is a party and is held equally liable, regardless of whether the corporation was prosecuted.[8]

Note that a contravention of the Act will not void a contract to purchase residential property from an innocent vendor. However, if a non-Canadian is convicted of having contravened the Act, a court may order that the property be sold in a prescribed manner and under prescribed conditions. Subsection 8(2) of the Act indicates that when a court orders the sale of residential property bought by a non-Canadian in contravention of the Act, the non-Canadian cannot receive more than the purchase price paid for the property from the proceeds of sale.

Given the implications of the Act, individuals who are involved in the real estate industry, such as real estate agents, mortgage brokers and lawyers, should take extra care to ensure that they confirm the residential status of purchasing clients. Real estate professionals should independently verify their clients’ identity, document their clients’ Canadian status, and have the clients confirm their status in writing.

Real estate professionals acting for the vendor in a transaction should also be wary about contravening the Act unintentionally. Even though it may not be the direct responsibility of the selling party to verify the Canadian status of the purchaser, do not be quick to conclude liability may not extend that far. It would be good practice to include certain provisions within an Agreement of Purchase and Sale to shield the selling party from potential liability at the outset of the transaction.

If you have additional questions or concerns regarding the Prohibition on the purchase of residential property by Non-Canadians Act, please feel free to contact Jason Lane at Woitzik Polsinelli LLP at 289-220-3241 or jason@durhamlawyers.ca.

This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with legal advice tailored to your specific situation and needs.

[1] SC 2022, c. 10 s. 235

[2] RSC, 1985 c. C-29.

[3] Supra note 1, s. 4(5). [emphasis added]

[4] RSC 1985 c.I-5.

[5] SC 2001 c.27.

[6] Supra note 5.

[7] Supra note 1, s. 4(2).

[8] Ibid, s. 6(2).

The post Non-Canadians Will be Prohibited from Buying Canadian Residential Property in 2023 first appeared on Devry Smith Frank LLP.

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Automotive dealers have a supply and demand issue: they cannot secure enough supply to meet the customer demand. In the wake of supply chain issues, and in the face of these market realities, many dealerships resort to including “market adjustment fees” on top of the final bill charged to the end customer. This market adjustment fee could be added even after the parties have negotiated the price. This sticker shock to the consumer can cause surprise and dismay.

Market adjustment fees may be hundreds or even thousands of dollars over the manufacturer’s suggested retail price. These fees are becoming more commonplace in the market of low inventory and inflated prices. However, many consumers wonder if dealerships can include market adjustment fees even after an agreement is reached between the customer and the dealership. The answer will likely depend on if the agreement is a binding contract.

Binding Contract or Negotiated Price?

A binding contract includes all the terms and conditions in which the dealer and the consumer agree to, including any additional fees. In order for a purchase agreement to be binding, each purchase agreement must contain the following statement next to the purchaser’s signature:

Sales Final

Please review the entire contract, including all attached statements, before signing. This contract is final and binding once you have signed it unless the motor vehicle dealer has failed to comply with certain legal obligations.[1]**

If an agreement reached between the dealership and the customer is not a binding contract, a dealership could add market adjustment fees in the final contract.

Background: The Law and Ethics

The legal framework is articulated by statute and regulations. The Ontario Motor Vehicle Industry Council (“OMVIC”) administers the Motor Vehicle Dealers Act, 2002, SO 2002, c 30, Sched B (the “Act”) which sets out the requirements that must be fulfilled by those engaging in the business of buying and selling vehicles. The OMVIC provides that under the Act, if a motor vehicle dealer advertises a price for a new or used vehicle, the price must include all fees and charges the dealer intends to collect with the exception of HST and licensing.[2] Examples of fees that must be included in an advertised price include government levies, pre-delivery inspection or expense fees, administration fees, and OMVIC fees.[3] However, adding additional fees to vehicles that catches a customer’s eye at a dealership is permitted — provided that the fees are clearly indicated in the contract.

The legal framework is complemented by a code of ethics for the industry. The OMVIC may not have the authority to stop the practice of adding market adjustment fees, but they may have the prerogative to remind dealerships to abide by the Act’s code of ethics. Section six (6) of the Act enshrines a code of ethics which requires dealerships to act with integrity, respect, and honesty.[4] This is a requirement to maintain registration.

OMVIC encourages their dealers and salespeople to meet the high standards enshrined in the legislation. However, none of the OMVIC bulletins issued since the pandemic specifically discourage dealerships from adding market adjustment fees or other unexpected charges in final contracts.[5] In particular, OMVIC did not provide any refutation that adding market adjustment fees are unethical, or that dealerships should not change interest rates or prices after prior negotiations.

Little Recourse without a Binding Contract (For Now)

Currently, consumers in Ontario have little recourse when a negotiated price is not a binding agreement. Consumers should ensure that all promises, terms, and conditions and a statement providing that the contract is final and binding once signed unless the dealer fails to comply with certain legal obligations are written on the contract.

South of the border, the Federal Trade Commission in the United States is proposing new rules which aim to prohibit market adjustment fees and bait-and-switch advertising tactics in an effort to eliminate unwanted charges.[6] If similar rules were adopted in Ontario, it would help protect consumers by making the car-buying process more clear and competitive. It would further allow OMVIC to recover money when consumers are misled or charged without their consent. Until such rules are implemented, customers will need to take the extra step to ensure their price negotiations are binding.

This blog was co-authored by student-at-law, Abby Leung

[1] https://www.omvic.on.ca/portal/Consumers/ConsumerProtection/CancellinganAgreement.aspx

[2] https://www.omvic.on.ca/portal/Consumers/ConsumerProtection/AllInPricing.aspx

[3] Ibid.

[4] SO 2002, c. 30 Sched B, s. 6.

[5] https://www.cbc.ca/news/business/market-adjustment-fee-car-sales-1.6653676

[6] https://www.ftc.gov/news-events/news/press-releases/2022/06/ftc-proposes-rule-ban-junk-fees-bait-switch-tactics-plaguing-car-buyers

The post Sticker Shock: Market Adjustment Fees in the Automobile Industry first appeared on Devry Smith Frank LLP.

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Further to our 8 November article on this topic, the More Homes Built Faster Act (Bill 23) received Royal Assent on to 28 November 2022 and is now largely in force. It is intended to increase housing supply and affordable housing options for Ontarians by getting 1.5 million homes built over the next 10 years. It boldly does so in a number of very significant and controversial ways.

The highlights of the approved form of Bill 23 include:

Development Charges Act, 1997Bill 23 creates a number of new exemptions from development charges as follows:

the greater of 1 residential unit or 1% of existing residential units in a building containing 4+ residential units;
up to 3 residential units in a new detached house, semi-detached house or rowhouse;
non-profit housing development; and
residential affordable housing pursuant to a development approved by way of a zoning by-law

(after 28 November 2022); and

residential units intended to be affordable or attainable for a period of 25 years or more

(on a date to be proclaimed)

Under section 5 of that Act the amount of development charges are now reduced on a sliding scale from 80% to 95% from the charges imposed pursuant to a by-law passed on or after January 1, 2022 (unless the DC is payable immediately prior to 28 November 2022).

Development charges for rental housing projects are reduced by 25% for premises with three or more bedrooms, 20% for two bedroom units, and 15% for all other residential units.

Commencing on 1 January 2023 municipalities are now required to spend and/or allocate each year at least 60% of the monies in reserve funds for water supply services, including distribution and treatment of services, waste water services, and treatment and services related to highways.

A development charge by-law now expires every 10 as opposed to every 5 years.

The Planning ActThe most significant changes to the Planning Act will limit/extinguish the appeal rights of third-parties, including upper tier municipalities now characterised as upper tier municipalities without planning responsibilities (the GTA Regions of Durham, Halton, Niagara, Peel, Waterloo, York and Simcoe) and conservation authorities (date to be implemented TBD).

For minor variances and consents the Act will restrict a right of appeal to applicants, public bodies and “specified persons” (public utilities, operators of railway lines, and telecommunications providers).

This will increase the significance of local Committees of Adjustment as they may now be the only opportunity to oppose a project.

Importantly this provision has retroactive effect and will nullify appeals where a hearing on the merits has not been scheduled before October 25, 2022.

Upper Tier municipalities without planning responsibilities will cease to become approval authorities for local planning instruments.

Bill 23 contains other consequential changes including:

deleting the prohibition on making requests for official plan and zoning by-law amendments for the 2 year period following their coming into effect;
allowing the Minister of Municipal Affairs and Housing to make amendments to official plans where the Minister is off the opinion that a plan will adversely affect a matter of provincial interest;
allowing up to three residential units in a house to be permitted “as of right” (including placing restrictions on parking requirements);
reducing the section 37 community benefit further by making the prescribed percentage of value (4%) subject to a ratio recognizing the existing floor area. This ratio will be further reduced where the formula takes into account affordable/attainable units (date to be implemented TBD);
exempting from site plan control (section 41):

A. residential development of up to 10 units and a land lease community home from site plan control; and

B. exterior design as an element to be considered in site plan drawings. It will be interesting to see what effect this has on urban design guidelines;

revising section 42, parkland dedication, requirements by:

A. with respect to the dedication of land/cash-in-lieu of 5% (residential rate):

1. decreasing that requirement by the percentage of affordable/attainable units (on a date to be proclaimed); and
2. exempting up to 3 residential units and non-profit housing;

B. with respect to the alternate rate (unless a building permit has been issued):

1. changing the rate from 300 units/ha to 600 units/ha;
2. restricting the calculation further to:
  1. if 5 ha or less of land, 10% of the land or the value of the land;
  2. if more than 5 ha 15% of the land or land value;
  3. excluding from the calculation:
1. the number of existing units; and
2. affordable/attainable units from the calculation of net residential units (date to be implemented TBD);

C. permitting land owners to propose the conveyance of portions of their land, including encumbered lands, for parkland purposes as opposed to having to rely on the determination of the local municipality (date to be implemented TBD); and

D. requiring municipalities to allocate at least 60% of monies collected for parkland purposes at the beginning of each year (1 January 2023).

amending section 51 by removing the requirement for a public meeting on subdivision applications.

Conservation Authorities Act The Conservation Authorities Act is amended to greatly reduce the ability of Conservation Authorities to regulate development activity by removing their ability to comment on development applications and to require permits for projects approved under the Planning Act. Moreover the Minister will have greater powers to make exceptions for development applications. (date to be implemented TBD).

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Often when spouses separate, one spouse leaves with much greater access to money than the other. Then that spouse wants to hold on to his or her money after separation, so doesn’t want to be cooperative, knowing that his or her ex does not have the money to go very far in Family Court, and so will just have to take what is offered and give up what he or she is entitled to receive.

There are a lot of good reasons to avoid going to Family Court. The cost of going through the process is a big one. Family Court costs exponentially more than mediation, arbitration or collaborative practice. But, where one spouse has all the money, he or she may not see any reason to choose a less expensive alternative when his or her ex cannot afford to go to court. Going to Family Court to enforce your rights usually means hiring a lawyer (you have to live in poverty to get Legal Aid, and Legal Aid only covers limited legal issues) and if one spouse cannot afford that, then that spouse may not even be able to make it in front of a judge to get what is fair.

Although, often all it takes is getting in front of a judge who is concerned that only one spouse has money for the other spouse to want to negotiate, go to mediation or otherwise stay out of court. When one spouse has found the money to start court proceedings, his or her ex may worry that there is the money to continue them. Starting court proceedings involves a lot of steps, which can make it expensive. So, an uncooperative spouse may choose to be cooperative to avoid spending more on a court case that he or she may lose, and uncooperative spouses may find that they lose a lot.

Fortunately, there are some options for people with limited funds to get the legal help they need to go to court:

Ask for money from friends and family. This is the most common way people get money for their divorce or to go to Family Court. Often, this money will be a gift, or if it is a loan, then the repayment terms are very favourable.
Hire a lawyer on a limited scope retainer. There is a lot more information at the link, but essentially this means hiring a lawyer to give advice only or do one specific task, rather than dealing with every part of the file. The spouse with limited funds then can chose what he or she is going to have the lawyer do and keep control over how much it will cost.
Ask a judge for an advance on monies owed. In many cases, particularly when it comes to property division in a divorce, it will be evident right from the beginning that one spouse will owe the other some money in the end. Where the spouse who needs money is the spouse who will be receiving the money, then it is possible to ask for the spouse with the money to pay at least some of it immediately. If the spouse with the money won’t agree to do this, Judges can order the payment on a motion where it is clear that one spouse will owe money. However, this is a motion for “partial summary judgment”, which makes it a little technical, so it is best to speak to a lawyer.
Ask a judge for “interim costs and disbursements.” Rule 24(18) of the Family Law Rules says that a judge can order that a party to a Family Court case pay an amount to another party to cover some or all of the expenses for carrying on the case. Judges may do this where it is necessary to “level to playing field” or where one party’s behaviour is so unreasonable it is clear that party will end up paying costs in the end anyway.
Get a “Divorce Loan” or a Litigation Loan. These can be expensive loans, but they may be worth it to a spouse who needs to go to court to get anything from their ex.

Also, it is often possible to get support orders, especially child support orders, early on in the case. These are for temporary support and are meant to last until there is a trial or settlement. They may not get the support amount exactly right, but they can provide some necessary cash flow to help with Family Court. With the court making automatic orders for disclosure right at the start of the case, the parties are required to provide at least basic financial disclosure within 30 days of the start of the court proceeding. That allows for at least an estimate of what support will be payable. Only unreasonable Family Court litigants will not settle some or all of the support issues. Judges may punish a party for being unreasonable by having that party pay the legal fees for the other party.

All of the above options that require a court order can be a little tricky and technical. It is best to at least book a consult with a respected family law lawyer to understand what option is best for you and how to pursue it.

Still, there is no denying that court is very expensive. It is the only dispute resolution process that one separated spouse can force the other into. For that reason, and others, some judges struggled between allowing each party the full opportunity to present his or her case the way he or she sees fit, and dealing with matters quickly and potentially leaving the impression that the court was not listening or did not care. Parties with more money can ask for more opportunities to pursue more steps, bring more motions, present more arguments, and generally litigate more aggressively than parties who are trying to do their case on a tight budget. In addition, where judges believe a settlement may be possible, there may be repeated settlement conferences, which one party can use to financially exhaust the other – looking ready to settle but just really trying to multiply the number of court appearances.

Many Family Court cases are wars of economic attrition. The party that can stay in the fight the longest can take advantage of the other party’s need to “get out” to leverage a favourable settlement. Or, the party with money can force on a trial, which will be extremely expensive, knowing the other party cannot afford to have a lawyer assist and so the party with less money either has to settle for a reduced amount, or face the prospect of losing at trial because he or she does not know how to conduct a trial, or the laws and rules that apply.

Of course, none of this matters when spouses want to work toward a fair arrangement after separation. But parties who want that should not be in Family Court in the first place. When things are nasty enough to go to court, each spouse really should speak to a lawyer about the financial situation on both sides and what that means for what strategy will work best for that spouse.

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Seven months into the COVID-19 pandemic, Alexandria Gentile-Patti was working from home as a telephone customer service agent for Air Canada. At the time, many Canadians brought their workplaces home to weather the pandemic. On September 25, 2020, Mme Gentile-Patti took her lunch break and ventured downstairs. After a few steps, she lost her footing [...]

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The Court of Appeal recently upheld the decision made in the case of Dagenais v. Pellerin, 2022 ONCA 76 which calls into question the scope of vicarious liability of an employer. This article will discuss how the court came to its reasoning, as well as outline the test for finding vicarious liability and the relevant [...]

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Facts: A 73-year old employee, who worked for the employer since 1996 and who performed the roles of receptionist, bookkeeper and office administrator, went on a medical leave of absence on September 29, 2015. The employer requested a medical certificate at this time. The employee did obtain a medical note from her physician dated November [...]

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It is likely that employer policies with respect to COVID-19 will be enforceable only where reasonable in the full context of all the facts and circumstances. A policy for mandatory vaccination may be unreasonable where practical alternatives exist. Most importantly, what is reasonable under one set of circumstances may be unreasonable in another. But whether [...]

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Takeaway: Tax Court finds that interest accrues until the actual date of loss carryback request: Case Summary: Bank of Nova Scotia v The Queen, 2021 TCC 70 In this recent decision, the Tax Court of Canada was tasked with interpreting paragraph 161(7)(b) of the Income Tax Act (the Act), and the timing of loss [...]

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The Public Health Agency of Canada (the “Agency”) is a federal government agency with a mandate to prevent disease and respond to public health threats. The federal Quarantine Act (the “Act”) authorizes various activities to protect public health including measures that can be taken in respect of international travellers.[1] Under the authority of the Act, [...]

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It is a common assumption among estate trustees that in order to administer an estate, a deceased’s Last Will and Testament must always be probated; that is, submitted to the court along with an application and supporting documents in a process whereby the court examines such Will in order to determine its validity and authenticity, [...]

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This is an update to our blog originally posted on July 6, 2021. There is no federal or provincial legislation requiring eligible individuals to be vaccinated against COVID-19. However, employers may impose their own vaccination policies as part of a good faith effort to follow public health guidance, stop the spread of COVID-19 and protect [...]

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Introduction There has recently been a significant increase in commercial lease disputes between landlords and tenants as a result of the COVID-19 pandemic and the many government-mandated stay-at-home orders and business lockdowns. As a result, courts have become inundated with disputes between commercial landlords and tenants over unpaid rent. The Federal government has approved a [...]

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In the past two years, COVID-19 has wreaked international havoc and the challenges are intensified when it comes to governance of parenting issues for separated parents.

While the unvaccinated have found creative temporary solutions in the face of government restrictions by exercising at a home gym rather than attending a favourite spin class or ordering delivery instead of dining at one’s favourite restaurant, a comparable temporary option is not available for unvaccinated parents.

Unvaccinated parents without valid medical exemptions are facing restrictions on parenting time with their child including temporary suspension of all in-person parenting time until they become fully vaccinated. Some restrictions imposed by the courts include reducing the frequency and duration of in-person visits, ordering in-person visits to take place exclusively outdoors and requiring the unvaccinated parent and child to wear masks for the duration of each visit.

In the case of S.W.S v. R.S[1], the mother brought a motion to change the unvaccinated father’s in-person parenting time with their two children, ages 8 and 4, to virtual. While neither child, in this case, was immunocompromised, the court held that “the father’s choice not to vaccinate himself directly affects the physical safety of the children – a primary consideration under subsection 24 (2) of the Act.”[2]**. The mother was fully vaccinated and followed all COVID-19 protocols and subject to the father becoming fully vaccinated, the father’s parenting time was reduced from alternating weekends and every Tuesday to just 2 hours every Sunday (in-person) with all parenting time to remain outdoors.

In the case of A.G. v. M.A.[3]**, the mother brought a motion to suspend the partially vaccinated father’s in-person parenting time with the parties’ 2-year-old daughter. The father relied on a one-line medical note from his doctor claiming that he is medically exempt from taking the second dose of the COVID-19 vaccine due to a severe allergic reaction to the first dose of the vaccine.

Notwithstanding the father’s lack of full vaccination, without an acceptable medical exemption, the Court concluded that the father’s partial vaccination status warranted some in-person parenting time with restrictions.

The father’s in-person parenting time with the child was limited from 2 hours weekly to 1 hour per week (in-person) exclusively outdoors or virtual if the weather is too inclement. In reaching this decision, the following factors were considered by the Court:

the child’s medical frailties which may leave her exposed to greater risk of contracting COVID-19;
The father’s partial vaccination status exposes him to greater risk of contracting COVID-19.[4]
In the determination of best interest of the child, the court places considerable importance on the child’s “safety, security and wellbeing” as mandated by the Children’s Law Reform Act.
The father had not tendered acceptable evidence to the court to properly assess the conclusion of his doctor that he should be exempt from his second COVID-19 vaccine.

If you are partially vaccinated or unvaccinated, consider:

If possible get fully vaccinated.
If you intend to rely on a medical exemption, ensure that your medical exemption is prepared by either a physician or a registered nurse and that your medical note complies with the requirements for medical exemption letters set out in the Ontario Ministry of Health’s paper on Medical Exemptions.
Consider virtual parenting options if you need time; however virtual parenting time is not a suitable long term solution and it cannot replace in-person parenting time, especially if a child is young particularly when a child is young.

If you have any further questions on the implication of COVID-19 and your parenting rights or you would like to speak with someone about your separation terms, please contact Sanaz Golestani from Devry Smith Frank LLP at Sanaz.Golestani@devrylaw.ca or call (289) 638 3174 for assistance with this matter.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see or speak to a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

This blog was co-authored by Angela Victoria Papeo

[1] S.W.S v. R.S 2021 ONCJ 646

[2] S.W.S v. R.S 2021 ONCJ 646 at. para. 35.

[3] A.G. v. M.A., 2021 ONCJ 531

[4] Fully vaccinated, the court is referring to two doses of an approved vaccine.

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Employees who are terminated without cause are entitled to either notice or compensation from their employers. A variety of factors affect how much notice or compensation each individual may receive under their own unique set of circumstances. Some of these circumstances may be “exceptional” and warrant an amount of notice or compensation which goes above the typical maximum; e.g., the COVID-19 pandemic being possibly the most exceptional circumstance of them all.

Notice Period for Termination Without Cause

An employer is entitled to terminate an employee without cause provided that the employee is either given reasonable notice or given payment in lieu of reasonable notice. This is the “Notice Period:” an amount of time, or a level of compensation, to assist a dismissed employee find comparable work. At common law, the Notice Period is “reasonable notice,” which varies with the circumstances of any particular case. (For a history of the development of the common law, see Machtinger v HOJ Industries Ltd).[1] The Notice Period is also a statutory entitlement pursuant to the Employment Standards Act, 2000.[2] The employment contract may specify an entitlement upon termination without cause, so long as entitlement is equal to or greater than the minimum standards in the Act. In other words, one cannot contract out of the Act.

In the event that a court must determine the Notice Period, it must engage in a balancing exercise. In Minott v O’Shanter Development Co, the Ontario Court of Appeal described how “determining the period of reasonable notice is an art, not a science. In each case, trial judges must weigh and balance a catalogue of relevant factors.”[3] These factors were outlined in 1960 by the Ontario High Court in Bardal v Globe & Mail Ltd as follows:

the character of the employment,
length of service,
age, and
availability of similar employment, having regard to the employee’s experience, training and qualifications.[4]

Note: These Bardal factors are applicable only where an indefinite-term employee is dismissed without cause without an enforceable termination clause. For greater clarity, these factors are not applicable where (i) the employment is for a fixed term, (ii) the employment contract contains an enforceable termination clause, (iii) the employee is dismissed for just cause under the common law, or (iv) the employee has commenced a complaint at the Human Rights Tribunal of Ontario (HRTO) for discriminatory termination.

The Unofficial Ceiling of Twenty Four (24) Months

As a general rule, the unofficial ‘ceiling’ for a Notice Period is twenty-four (24) months. The Court of Appeal held in Lowndes v. Summit Ford Sales Ltd that while “there is no absolute upper limit or ‘cap’ on what constitutes reasonable notice, generally only exceptional circumstances will support a base notice period in excess of 24 months.”[5] It will be up to the employee to establish that their circumstances are exceptional.

Absent exceptional circumstances, the base Notice Period of twenty-four (24) months provides for a realistic maximum. Having certainty in this regard helps both employers and employees come to an agreement about the employee’s entitlement in the event of a without-cause termination.

Ultimately, certainty provides for more confidence as to the outcome of a dispute about the entitlement. This certainty keeps litigation costs down.

‘Exceptional Circumstances’ Lengthening the Notice Period

The notion of ‘exceptional circumstances’ reduces the certainty of the Notice Period, but the factors are not unpredictable. The courts often look at the Bardal factors to determine what circumstances qualify as exceptional.

In 2016, in Keenan v Canac Kitchens Ltd, the Court of Appeal declined to overturn an award of twenty-six (26) months based on the employees’ ages at the time of termination (63 and 61 years old), their length of service (32 and 25 years), and the character of their supervisory and representative positions; i.e., “for over a generation, they were [the employer]’s public face to the outside world.”[6]

In 2021, in Currie v Nylene Canada Inc, the Ontario Superior Court of Justice also granted an award of twenty-six (26) months to an employee who had worked for the same employer for her entire working life, was approaching the end of her career, and that she would face pronounced difficulty transferring her highly specialized manufacturing skills to another employer.[7]

The general case remains to be that the unofficial upper ceiling of twenty-four (24) months is appropriate for most cases, but the court does reserve the right to extend the Notice Period when exceptional circumstances call for an exception to the general rule.

The ‘Exceptional Circumstance’ of COVID-19

On March 11th, 2020, the World Health Organization declared a pandemic due to Coronavirus disease (“COVID-19”): an infectious disease caused by a newly discovered coronavirus. On March 17th, 2020, the Ontario Government declared a state of emergency due to an outbreak of COVID-19. The pandemic is an unprecedented circumstance that the court has considered when calculating Notice Periods.

In the pre-pandemic era, in Michela v St Thomas of Villanova Catholic School, the Ontario Court of Appeal held that “an employer’s financial circumstances are not relevant to the determination of reasonable notice in a particular case.”[8] In other words, the employee’s entitlement to a Notice Period is not reduced just because times are financially dire for the employer (just as the employee would not be entitled to a larger Notice Period if the employer is enjoying prosperity).

However, the court has recognized COVID-19’s negative effect on the labour market as grounds to lengthen the Notice Period. In Yee v Hudson’s Bay Company, the court noted that it “should take into account the recent COVID pandemic and resulting in significantly increased difficulty in obtaining comparable employment.”[9] For example, in Kraft v Firepower Financial Corp, the court awarded a terminated employee an award of ten (10) months after finding that the normal average award was nine (9) months; i.e., “one month more than the average for his circumstances during non-pandemic times.”[10] Further, in Pavlov v The New Zealand and Australian Lamb Company Limited, the court not only awarded the employee an above-average award but also awarded a bonus on a pro-rata basis with reference to the bonuses paid to other employees during the same time frame.[11]

The court has yet to extend a Notice Period beyond the unofficial twenty-four (24) month ceiling due to COVID-19—but it would not be unfathomable.

Conclusion

Employees terminated without cause are entitled to a reasonable Notice Period which is generally limited to twenty-four (24) months. However, the courts have not imposed this limit as an un-crossable threshold, rather it reserves flexibility for itself to extend the Notice Period for circumstances that are exceptional. The Bardal factors which help to determine the Notice Period are also helpful to determine if any exceptional circumstances are present. With respect to the factor of ‘availability of similar employment,’ the courts have recognized the impact of the COVID-19 pandemic and have, accordingly, extended Notice Periods—but not (yet) beyond twenty-four (24) months.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

[1] 1992 CanLII 102 (SCC).

[2] SO 2000, c 41.

[3] 1999 CanLII 3686 (ON CA).

[4] 1960 CanLII 294 (ON SC) at 145.

[5] 2006 CanLII 14 (ON CA) at para 11, citing Baranowski v Binks Manufacturing Co, 2000 CanLII 22614 (ON SC) at para 277, citing Veer v Dover Corp. (Canada) Ltd, 1997 CanLII 12429 (ON SC).

[6] 2016 ONCA 79 (CanLII) at paras 30-34, cited by Dawe v The Equitable Life Insurance Company of Canada, 2019 ONCA 512 (CanLII) at para 32.

[7] 2021 ONSC 1922 (CanLII) at para 84.

[8] 2015 ONCA 801 (CanLII) at para 17.

[9] 2021 ONSC 387 (CanLII) at para 20.

[10] 2021 ONSC 4962 (CanLII) at para 22 [emphasis added].

[11] 2021 ONSC 7362 (CanLII) at para 24.

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For many couples, the matrimonial home represents the largest and most significant asset. It is therefore incumbent to understand how the matrimonial home is treated upon a breakdown of the marriage and how to protect and preserve your rights if you brought the home that is your matrimonial home into the marriage.

Property Division in Ontario

Property division rights for married spouses are governed by the Ontario Family Law Act. Upon a marriage breakdown or if one spouse dies, each spouse is entitled to an equal division of the value of all of the assets that have been acquired during the marriage, subject to certain exceptions. As part of this calculation, a spouse is entitled to receive a credit for date of marriage assets brought into the marriage unless the property becomes the matrimonial home.

The Matrimonial Home

In Ontario, there are special rules with respect to the treatment of the matrimonial home once a marriage ends.

Part II of the Family Law Act deals entirely with the matrimonial home and defines what it is and sets out the unique treatment and rules regarding the matrimonial home.

Section 18(1) of the Family Law Act defines a “matrimonial home” as:

“Every property in which a person has an interest and that is or, if the spouses have separated, was at the time of separation ordinarily occupied by the person and his or her spouse as their family residence is their matrimonial home.”[1]

For the purposes of calculating an equalization payment, if a spouse brings a home into the marriage and that home becomes the family residence, then the right to deduct the value of the home as a date of marriage asset is lost by that spouse. Instead, the value of the matrimonial home will be included as a date of separation asset for the spouse who owns the home.

If you are married, you can have more than one matrimonial home, however, the Ontario Court does not have authority to grant one spouse the exclusive right to possession of the home if it is located outside of the province.

Unique Treatment of the Matrimonial Home Under the Family Law Act

Unless there is an agreement or a court order for exclusive possession of the matrimonial home granted to one spouse, under Section 19 of the Family Law Act, both spouses have an equal right to possession of the matrimonial home.[2] This means that absent an agreement or court order, neither spouse can lock the other out of the matrimonial home. The criteria that the Court will consider when determining the issue of exclusive possession is set out under section 24(3) of the Family Law Act.

Another unique characteristic of the matrimonial home is the absence of court order or consent, neither spouse can sell or encumber any interest in a matrimonial home.

Protecting your Home with a Marriage Contract

Whether you are currently married or plan to get married, you can enter into a marriage contract to protect and preserve your rights in the event of a breakdown of your marriage. To ensure your rights are protected you should enter into a marriage contract that is prepared by an experienced Ontario family lawyer.

For more information regarding divorce, property division, marriage contracts, or any other family law-related topic, contact Whitby family lawyer Sanaz Golestani at 289-638-3173 or Sanaz.Golestani@devrylaw.ca.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

[1] Ibid, s 18(1).

[2] Family Law Act, supra note 1, s 19.

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Workplace Harassment Awareness

In recent years, the #MeToo movement has helped bring attention to and spark the well-needed conversation of an important workplace issue that affects the safety and security of individuals in the workplace. As a result of these conversations, we have begun to see a shift take place in workplace culture, by adding policies and protections where victims of harassment and sexual misconduct are encouraged to come forward and speak out on these issues in an effort to hold wrongdoers accountable.

The reporting of such occurrences in major sports leagues and Hollywood has brought a heightened, but long overdue, awareness, sensitivity and attention to the issues of harassment and misconduct within the workplace. Societal, political and technological responses have led organizations to listen and be more proactive in their approach of reviewing and updating policies, procedures and responses to issues of violence and harassment in the workplace. These changes are aimed at ensuring workplaces are better positioned to prevent and address such issues from taking place. To do this, it requires workplaces to take a proactive approach, by having a plan in place with policies and procedures to implement that prevent such occurrences from taking place. 1

Beyond avoiding the obvious reputational harm, organizations have a legal obligation to provide a safe, non-toxic work environment. 2 The aim is to ensure that all workers are given an equal opportunity to participate in a safe and respectful environment. Failure to do this can attract vicarious liability, bad press and even lawsuits against employers and perpetrators. 3 In order to address these issues and manage risks in the workplace, employers need to have channels of reporting, check systems and appropriate response mechanisms in place to address problems of this nature.

TIPS FOR EMPLOYERS

Being Proactive and Having Preventative Measures In Place to Prevent Workplace Sexual Harassment

1. Leadership & Setting the Tone

Establish a strong commitment from management and from human resources in creating an open and respectful work environment and culture. This can involve ensuring informative resources and training seminars are available to educate all employees on sexual harassment and channels of reporting. Having internal policies that address sexual misconduct and promote a culture of zero tolerance helps set the tone. Providing education and training helps ensure that policies/procedures for reporting are understood by workers, which promotes more awareness and accessibility of such programs and supports.

2. Commitment and Implementation

Ensuring that policies you have in place are being used effectively is key. Ask for feedback from individuals within the investigation processes, to comment on the channels of reporting and response structure. Ensure processes and policies enable timely communication of any issues.

3. Visibility & Accessibility & Awareness

Ensure your policies and procedures are visible and accessible in the workplace. This could be in the form of visual posters, pamphlets, electronic resources or information on company website pages. Periodic check-in sessions with staff to ensure any questions or concerns are answered also helps. This information should be open, transparent and readily accessible for all workers.

4. Reviews & Checks 4
Conduct periodic reviews of the channels of reporting, systems used, and investigation processes to ensure they are effective. This is an important step to identifying and correcting any gaps or flaws.

It is in the best interests of everyone to ensure workplaces are safe, supportive and respectful spaces, where individuals are supported, respected and heard.

If you have more questions related to sexual harassment in the workplace, if you have experienced sexual harassment within the workplace or are an employer wanting to better position yourself in this regard, please visit our website or contact Timothy Gindi at Devry Smith Frank LLP to discuss any questions regarding your rights and options. This blog was co-authored by Student-At-Law Amar Gill.

“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please contact a lawyer. Each case is unique and different and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

Sources

[1] http://www.ohrc.on.ca/en/policy-preventing-sexual-and-gender-based-harassment/8-preventing-and-responding-sexual-harassment-0

[2] http://www3.ohrc.on.ca/sites/default/files/attachments/Sexual_harassment_in_employment.pdf

[3] http://www.ohrc.on.ca/en/sexual-harassment-employment-fact-sheet

[4] https://www.canada.ca/content/dam/canada/employment-social-development/services/health-safety/reports/workplace-harassment-sexual-violence-EN.pdf

The post Practices to Help Curve Sexual Harassment in the Workplace – Tips for Employers – Part 1 of 2 first appeared on Devry Smith Frank LLP.

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What is cryptocurrency?

Cryptocurrency is decentralized digital money, based on blockchain technology. It is a form of currency that can be exchanged online for goods and services. However, it is not legal tender in Canada as it operates independently of any central bank, central authority or government.

The Currency Act defines legal tender as only:

Bank notes issued by the Bank of Canada under the Bank of Canada Act
Coins issued under the Royal Canadian Mint Act

How does the CRA Approach Cryptocurrency?

The CRA’s position is that cryptocurrency should be treated as akin to a commodity for the purposes of the Income Tax Act. As a result, crypto transactions are subject to the same rules as barter transactions – transactions where one commodity is exchanged for another. Any income from transactions involving cryptocurrency can be treated as business income/losses or as a capital gain/loss, depending on the taxpayer’s circumstances.

When is cryptocurrency taxed?

Canadians typically do not pay any taxes to hold a cryptocurrency but doing any of the following can lead to tax liability:

Gifting cryptocurrency
Selling cryptocurrency
Exchanging or trading cryptocurrency, including converting between cryptocurrencies
Converting from cryptocurrency to CAD or another fiat currency
Buying goods or services with cryptocurrency

Do you need to declare your income from cryptocurrency transactions to CRA?

Yes. Income or gains from trading in digital currencies are subject to tax under the income tax rules. Gains and losses from buying and selling cryptocurrencies must be reported in a taxpayer’s income when filing a tax return. Depending on the extent of the trading activities, the transactions may be characterizable as being on account of income or capital.

Generally, if an individual is in the business of trading cryptocurrency, or is engaged in an “adventure or concern in the nature of trade” any gains or losses ought to be reported as being on account of income. If an individual is not engaged in the business of trading cryptocurrency, gains or losses can be reported as being on account of capital.

Business Income:

The case law provides guidance to CRA auditors who typically use the following factors to categorize cryptocurrency as business income:

Volume of trades – the more a taxpayer trades in a given year may indicate an “active” business
A product or service is promoted
The overall behaviour is managed in a commercially viable way
Activities are done “in a business-like manner” (such as acquiring inventory or capital assets or making a business plan)

The net income will be fully included in income and taxed at the individual’s marginal income tax rate. CRA considers cryptocurrency mining, trading, exchanges, and ATMs to all be cryptocurrency businesses.

Adventure or Concern in the Nature of Trade

The CRA may also consider transactions to be an adventure or concern in the nature of trade, which would also result in a full income inclusion for the taxpayer, even if only a single transaction is undertaken. The relevant factors to consider are:

whether the taxpayer dealt with the property in the manner consistent with how a dealer in said property would ordinarily deal with it
whether the nature of the property itself precludes the possibility that its sale was a realization of an investment or of a capital nature
whether the taxpayer’s intention as deduced is consistent with a trading intention

Of the above factors, generally, the courts have held that the taxpayer’s intention is the most important and usually is determinative. The result is the same as business income, meaning that the taxpayer will be required to include 100% of the net gain into income.

Capital Gains:

Generally, a transaction will be considered on account of capital based on some of the following factors:

The property was purchased to generate recurring income such as rent or dividends
Evidence of an intention to hold long term
There is an absence of evidence of business intention or behaviour related to the asset

When characterized as a capital gain, only 50% of the net gain will be included in the taxpayer’s income for the year and will be taxed at the individual’s marginal rate.

Reporting Ownership of Cryptocurrency to CRA

Because cryptocurrencies are treated in a similar manner to any other type of asset, Canadians who hold bitcoin or other cryptos with an aggregate cost base greater than $100,000 on exchanges or physical wallets outside of Canada will need to report their holdings on the T1135 – Foreign Income Verification Statement which must be filed each year with the income tax return if applicable. Failure to do so results in a strict liability penalty of up to $2,500 per year, and there is the potential for additional Gross-Negligence Penalties in excess of $10,000 per year to be assessed.

What if you fail to declare your (taxable) profits?

Failure to report income from cryptocurrency transactions, or failure to declare cryptocurrency held offshore is illegal in Canada and can result in prosecution for a criminal offence under the Income Tax Act, the imposition of extremely punitive Gross-Negligence Penalties and more. Depending on your circumstances, however, it may be possible to correct the deficiency with CRA by proactively filing a Voluntary Disclosure Application. Late-filing or amending can be considered but will result in penalties, so seeking specific legal advice in advance is preferred.

For all your tax-related queries please contact Nathaniel Hills via email at nathaniel.hills@devrylaw.ca or call 416-446-5841.

The post A Legal Guide to Cryptocurrency in Canada first appeared on Devry Smith Frank LLP.

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On January 1, 2022, Ontario will become a substantial compliance jurisdiction in terms of the formal requirements that must be met in order to make and modify wills. Prior to the new laws taking effect, Ontario was a strict compliance jurisdiction. Under strict compliance, wills are invalid if they do not meet all of the formal requirements of execution, and a judge does not have authority to “validate” a will which does not meet these requirements.

On April 19, 2021, Bill 245 – the Accelerating Access to Justice Act received royal assent and added a new Section 21.1(1) to the Succession Law Reform Act (the “SLRA”). The SLRA now allows the Superior Court of Justice to validate a Will that does not meet all the required formalities. However, the court must be satisfied that the document or writing “sets out the testamentary intentions of a deceased”.[1] The SLRA introduces a shift from strict compliance to substantial compliance and applies to deceased persons who died on or after January 1, 2022.

Until the substantial compliance regime is tested by the Ontario courts, it is unclear exactly how the new law will operate. Until then, we can look to other Canadian jurisdictions for some guidance. British Columbia became a substantial compliance province in 2014. In Hubschi Estate (Re), the Supreme Court of British Columbia concluded that Mr. Hubschi’s non-compliant Will was valid. Mr. Hubschi wanted to distribute his assets to his foster siblings but did not meet the requirements under the Wills, Estates and Succession Act, SBC 2009, c 13. If the Will was found valid, his assets would be distributed to his foster siblings. However, if the Will was found invalid, his assets would be distributed to his blood relatives with whom he had no relationship.

Mr. Hubschi created a Word Document before his death that said “Get a will made out at some point. A 5-way assets split for remaining brother and sisters. Greg, Annette or Trevor as executor”. The court was satisfied on a balance of probabilities that the document was an expression of Mr. Hubschi’s testamentary intentions and that the document contained Mr. Hubschi’s full, final and fixed intentions. The court looked to the following factors when inferring Mr. Hubschi’s intention:

Mr. Hubschi was hospitalized prior to his death and could not retain a lawyer to incorporate his testamentary intentions in a Will;
he had a close relationship with his foster siblings; and
he reviewed the document on the same day of his death.

As evidenced by Mr. Hubschi’s case, the new law provides flexibility and can improve access to justice. However, this change in legislation will also inevitably cause uncertainty.

In theory, it could result in voice notes, text messages, and sticky notes on an existing will, being admitted as valid testamentary documents.

[1] Accelerating Access to Justice Act, SO 2021, c 4, s 21.1(1).

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Where the physical or mental condition of a party to a proceeding is at issue, a medical examination may be granted by a court of competent jurisdiction. This examination is generally regarded as a defendant’s right in personal injury cases. However, there are a number of considerations which affect the availability of multiple examinations for any given case.

Where multiple examinations are requested, the primary consideration will be fairness, and it will be critical to establishing the necessary evidentiary basis supporting the defendant’s argument that fairness requires a second or further examination.

Notably, a recent decision of Justice Nicholson of the Ontario Superior Court[1] has highlighted the conflicting considerations applicable to this right and cautioned legal practitioners against seeking “a second kick at the can.”

General Rule: One Examination per Specialty per Defendant Typically, in a personal injury matter, an examination will be permitted for each specialty applicable to the plaintiff’s injuries. For example, an orthopaedic examination is appropriate where there are orthopaedic injuries; a psychiatric examination is appropriate where there are psychiatric complaints. Examinations by other specialists are appropriate where there are complaints within the area of expertise of those experts.

The defendant’s right to a medical examination of the plaintiff in a personal injury matter arises under section 105 (2) of the Courts of Justice Act:[2]

“where the physical or mental condition of a party … is in question, the court … may order the party to undergo a physical or mental examination by one or more health practitioners.”

“Health practitioner” is defined as a person licenced to practice medicine, dentistry, or psychology.

While the language of the statute is discretionary (i.e., “may order”), a first medical examination has been generally established by the courts as a right. Beyond the first exam, section 105 (4) of the Act permits “further physical or mental examinations.”

The procedure is set out in Rule 33 of the Rules of Civil Procedure. Specifically, the order for the examination “shall name the health practitioner or practitioners by whom the examination is to be conducted.”[3]

Similarly, Rule 33.02 (2) empowers the court to order a “second examination or further examinations.”

Where there are two or more defendants, each defendant is entitled to a separate defence medical examination of the plaintiff by their own experts.[4]

“Overlapping” Examinations A court will typically not permit multiple “overlapping” examinations to assess the same type of injury. For example, examinations by an orthopaedic specialist and by a physiatrist regarding the same orthopaedic injuries or an examination by a psychologist and a psychiatrist with respect to the same psychiatric complaints would not generally be permitted.

However, grey areas arise where there are injuries or complaints that are partially within the expertise of one specialty and partially within the expertise of another. For example, where a plaintiff claims to have suffered a traumatic brain injury (TBI) as well as psychiatric complaints following an accident, an examination by a neuropsychologist with respect to the TBI complaints might be appropriate and an examination by a psychiatrist with respect to the psychiatric complaints might also be appropriate. The court will look at the degree of overlap between the complaints and may restrict the examination to either a neuropsychologist or a psychiatrist.

In one case where examinations had been conducted by a psychiatrist and a neurologist, the court refused to order further examinations with a neuropsychologist, an orthopaedic surgeon, and a second psychiatrist.[5] In another example, an examination by a psychiatrist was refused where an examination had been conducted by a psychologist, on the basis that there was an inadequate evidentiary basis for the psychiatric examination and the examination could delay the trial.[6]

In determining whether a further or “overlapping” examination will be ordered, the court considers whether the defendant will be prejudiced if no examination is permitted, and this will be weighed against any risk of prejudice to the plaintiff.[7] A key factor in determining prejudice is any possible delay in the trial. The decision will be based upon the evidentiary record, and the defendant has the onus to provide evidence supporting the need for a second or further examination and addressing the issues of fairness and prejudice.[8]

Examinations by Accident Benefits Insurers A defendant in a tort action will be entitled to conduct defence medical examinations notwithstanding that the plaintiff may have been examined by the defendant’s Statutory Accident Benefits Schedule (SABS) insurer where the initial examination did not address all the issues and there was no abuse of process.[9]

An examination under an insurance contract is separate and distinct from a medical examination under section 105. An examination under contract prior to litigation commencing does not pre-empt the defendant’s right to an examination under section 105.[10]

The Test for Fairness (Bonello) The applicable test for further examinations was addressed by Justice Brown in Bonello v Taylor.[11] Justice Brown stated that the overriding consideration was trial fairness.

In brief, the factors are:

the assessment would be for a legitimate purpose (i.e., not to delay or cause prejudice);
the party’s medical condition has changed or there is new information;
a report by the defendant is needed to “match” the expert evidence from a specialist’s report from the plaintiff—although this is not automatic;
the proposed examination would be necessary as a diagnostic aid, if conducted by a person who is not a health practitioner (e.g., a rehabilitation expert);
there is sufficient persuasive evidence to demonstrate the need;
evidence of unfairness is also taken into account; and
whether the further examination would impose an undue burden on the plaintiff. Read a full summary of the factors in Bonello.

When Is Further Examination Denied (Mitsis ) The recent decision of Justice Nicholson in Mitsis v Holy Trinity addressed many of these factors.[12] The plaintiff was pursuing a slip and fall claim and alleged that she suffered injuries including a fractured right shoulder and arm.

Following examinations for discovery, the defendant arranged to have the plaintiff examined by a physiatrist (at that point, the plaintiff had not served any experts’ reports). Subsequently, the plaintiff served a report from an orthopaedic surgeon. In response, the defendant sought their own examination by an orthopaedic specialist. The defendant claimed that it would be prejudiced if a defence orthopaedic assessment were not permitted.

Justice Nicholson stated that there had been no material change in the plaintiff’s condition and the defendant knew that the plaintiff’s injuries were primarily orthopaedic in nature when it elected to commission a physiatry exam.

Justice Nicholson felt that there was no procedural unfairness to holding the defendant to its choice of experts, and denied the request for a defence orthopaedic examination. As an aside, Justice Nicholson commented that perhaps the defendant’s physiatry report was not as favourable as the defendant might have hoped:

“One cannot help but be suspicious that the Defendant had hoped for a report more favourable to its position in the litigation from Dr. Perera [the defence physiatrist] and is now seeking a ‘mulligan.’”

Conclusion The importance of establishing the necessary evidentiary basis for a second or further medical examination of the plaintiff cannot be overstated. An affidavit from the prospective medical expert setting out why a further examination is necessary is generally preferable to an affidavit based on information and belief from defence counsel’s clerk. The affidavit material must address the factors set out in Bonello. Establishing that fairness favours permitting the examination and that the plaintiff will suffer no undue prejudice will be key.

[1] Mitsis v Holy Trinity Greek Orthodox Community of London and Vicinity, 2021 ONSC 5719 [Mitsis].

[2] Courts of Justice Act, RSO 1990, c C.43, as amended.

[3] Rules of Civil Procedure, RRO 1990, Reg 194, as amended [emphasis added].

[4] Maniram v Jagmohan, [1988] OJ No 2877.

[5] Jones v Spencer, [2005] OJ No 1539.

[6] Clarfield v Crown Life Insurance, [2000] OJ No 960.

[7] Lawrence v Primmum Insurance Co, 77 CPC (6th) 388; see also Suwary (Litigation Guardian of) v Women’s College Hospital, 2008 CarswellOnt 887.

[8] Abergel v Hyundai Auto Canada, [2002] OJ No 4387.

[9] Jeyanthiran v Ratnam, [2009] OJ No 469.

[10] Paul Revere Life Insurance Co v Sucharov, [1983] 2 SCR 541.

[11] Bonello v Taylor, 2010 ONSC 5723.

[12] Mitsis, supra note 1.

The post “No Mulligans”- Challenges Faced By Insurers Requesting Multiple Medical Examinations In Personal Injury Cases first appeared on Devry Smith Frank LLP.

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Defining General Damages

In every motor vehicle accident, an individual may claim general damages. General damages is commonly referred to as non-pecuniary losses, non-economic damages, or quite simply damages for pain and suffering. These are damages that are not economic in nature, yet still, affect a person’s lifestyle and quality of life. They cannot be calculated or quantified like lost income or medical bills, rather they compensate for things like pain and suffering, loss of quality of life, and emotional or psychological distress.

The Threshold

In Ontario, in order for an individual to recover general damages (i.e. damages for pain and suffering, also known as non-pecuniary losses) in a motor vehicle accident lawsuit, the individual must first satisfy the “Threshold Test” 1 by proving on a balance of probabilities that their injuries are both permanent and serious:

As denoted in section 267.5(5) of the Insurance Act– the owner of an automobile, the occupants of an automobile and any person present at the incident are not liable in an action in Ontario for damages for non-pecuniary loss from bodily injury or death arising directly or indirectly from the use or operation of the automobile, UNLESS as a result of the use or operation of the automobile the injured person has died or has sustained:**

(a) permanent serious disfigurement; or

(b) permanent serious impairment of an important physical, mental or psychological function. 1996, c. 21, s. 29; 2011, c. 9, Sched. 21, s. 3 (3).2

The Deductible

In addition to satisfying the threshold test, an individual must also prove that their general damages exceed the statutory deductible in order to recover any amounts under this head of damages. The current statutory deductible for 2021 is $39,754.31 and increases each year.3 What this means is – if an individual is involved in a motor vehicle accident and their claim for pain and suffering is valued at an amount equal to or less than the current statutory deductible, they will receive nothing under this head of damages.[1]

It is important to note that this statutory deductible applies only to general damages – so if an individual has losses relating to housekeeping or income loss, for example, this deductible does not apply for those damages. The rationale for this deductible is to discourage smaller or frivolous tort claims, and operates to save insurance companies from paying out on smaller claims.

For example: An elderly and retired individual was on their way to the local grocery store, and while driving to their destination, was rear-ended by another motorist. As a result of the accident, the elderly individual sustained various injuries, and now has difficulty doing housekeeping tasks at home and can no longer enjoy the things they used to do like taking long walks, exercising or travelling with their family. The elderly individual sues the other motorist, and the two sides are unable to come to a fair settlement at mediation, so the case proceeds to trial.

At trial, after hearing the evidence and considering the facts of the case, the jury deliberates and agrees that the claim satisfies the threshold test, concluding the injuries sustained are both permanent and serious, and as a result awards damages. The jury arrives at a number for general damages which they think is fair to compensate the elderly individual for their injuries. In addition to an award of $10,000 of damages for housekeeping, the elderly person is awarded $60,000 for general damages relating to pain and suffering.

From this amount, the statutory deductible of nearly $40,000.00 is subtracted, leaving the insurance company liable to pay out a little over $20,000.00 to the elderly individual for the general damages. All in all, the elderly individual takes home $10,000 in damages for housekeeping and a little over $20,000 for general damages.

If you have more questions related to motor vehicle accident claims, please visit our website or contact Cindy Leung at Devry Smith Frank LLP and Derfel Injury Law to discuss any questions regarding your rights and options. This blog was co-authored by Student-At-Law Amar Gill.

Sources

[1] https://www.ontario.ca/laws/statute/90i08

[2] Ibid.

[2] https://www.fsrao.ca/industry/auto-insurance/regulatory-framework/guidance/2021-automobile-insurance-indexation-amounts-guidance-updated-december-18-2020

[1] As of 2021, the deductible of $39,754.31 is waived if an individual’s claim is above the monetary threshold of $132,513.28. This monetary threshold is also subject to increase each year.

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Across Canada, there continues to be a rising trend in self-represented litigants. With this comes the need for these individuals to understand the rules and procedures of the court to ensure efficient, fair and affordable access to justice.

In the recent decision of Bloomer v Workers Compensation Board (2020), Alberta’s Court of Appeal confirmed that motion judges have no authority to correct the procedural missteps of self-represented litigants, reinforcing the expectation that self-represented litigants familiarize themselves with the relevant legal practices and procedures pertaining to their individual case.1

While the Court acknowledged the disadvantages encountered by self-represented litigants, it nevertheless confirmed that the same statutory regime and rules apply regardless of whether the litigants have legal representation or not.

Self-represented litigants may be shown some flexibility in the judicial process in the manner in which they are guided and shown leniency at times. However, there are instances where Courts are limited in their flexibility, where there simply are no redo’s, such as with court filings.

Filing Mistakes Can Prove Costly

Hypothetical: Let’s say you come and notice that your child’s vehicle is damaged; it appears to have been rear-ended while parked, and you have good reason to believe it was the fault of your neighbour. (Ex: Security camera footage).

Since the vehicle is owned by your 17-year-old, you decide in an effort to save costs to bring an action in small claims court against your neighbour for the cost of the repairs. You draft up the claim under your child’s name, file it in the Court’s e-filing system and click submit. Moments later, you realize you used the wrong form and now you need to correct the form you’ve submitted. What’s the fix and will it cost you?

Unfortunately yes, and the fix is not as straightforward as hoped. Since the claim involves a minor, or as the court defines it (a person with a disability), the court clerk would not be able to accept a Form 23A “Intent to Withdraw” or “Notice of Discontinuance” due to Rule 23 of the Rules of Civil Procedure. A registrar is unable to sign off on this change due to the involvement of a minor.

RULE 23 DISCONTINUANCE AND WITHDRAWAL 2

Discontinuance by Plaintiff

23.01 (1) A plaintiff may discontinue all or part of an action against any defendant,

(a) before the close of pleadings, by serving on all parties who have been served with the statement of claim a notice of discontinuance (Form 23A) and filing the notice with proof of service;

(b) after the close of pleadings, with leave of the court; or

(2) If a party to an action is under disability, the action may be discontinued by or against the party only with the leave of a judge obtained on motion under rule 7.07.1. O. Reg. 19/03, s. 6.

To correct this mistake, it will require bringing a motion to a judge to explain what happened with respect to filing the incorrect form. When drafting this motion, the Court advises to provide notice to the other side, and if possible, to obtain their consent. If the opposing side has already filed an intention to defend, this change will likely involve cost consequences.

There are limits on the Court’s ability to relax the rules for self-represented litigants, particularly when it comes to contraventions or issues of non-compliance that affect deadlines, limitation periods and filing mistakes.

Takeaway: When going the route of self-representation, be careful when filing and familiarize yourself with the rules, procedures and protocols applicable to your case because mistakes can be costly.

Conclusion

Access to justice has become an important issue of focus in many areas of the law, particularly in family courts. It is important to rely on the help of experts and legal professionals to help navigate and guide you through the process.

This blog was co-authored by Student-At-Law Amar Gill.

Sources

[1] https://www.canlii.org/en/ab/abca/doc/2020/2020abca334/2020abca334.html?resultIndex=1

[2] https://www.ontario.ca/laws/regulation/900194

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If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.