The Future of Firearms: Bill C-21 Proposes Strongest-Ever Restrictions 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 Code 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. 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. 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. 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 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 student-at-law Rachel Weitz. By Fauzan SiddiquiBlog, Criminal LawMay 12, 2023May 25, 2023
Impaired Driving – Recent Decisions from the Supreme Court of Canada For those who practice impaired driving and 80 plus law, the Supreme Court of Canada (SCC) recently rendered two decisions of interest. R. 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. R. 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. “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.” By Fauzan SiddiquiBlog, Criminal LawMay 1, 2023July 5, 2023
Proposed Provincial Planning Statement 2023: A Summary 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 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 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 “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 student-at-law Abby Leung. By Fauzan SiddiquiBlog, Real EstateApril 19, 2023June 10, 2023
Immigrant Entrepreneurs: What to Know About Canada’s Start-up Visa Program 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 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 [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 By Fauzan SiddiquiBlog, ImmigrationApril 4, 2023August 11, 2023
What Parents Need to Know About Private Schools and Education Law – Before Signing Their Kids Up 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. “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.” By Fauzan SiddiquiBlog, Education Law, UncategorizedMarch 24, 2023July 5, 2023
Ontario Court of Appeal Affirms That Construction Liens’ Priority Under the Construction Act is Limited to Extent of the Deficiency in the Owner’s Holdback 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 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 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. By Fauzan SiddiquiBlog, Construction Law, Real EstateMarch 14, 2023June 25, 2023
Are Pre-Contractual Negotiations Admissible in the Interpretation of Ambiguous Contracts? 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.[i] 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.”[ii] 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.”[iii] 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.”[iv] 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.”[v] 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…”[vi] 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 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 Owais Hashmi* [i] Resolute FP Canada Inc. v Ontario (Attorney General), 2019 SCC 60 at para 100. [ii] Sattva Capital Corp. v Creston Moly Corp., 2014 SCC 53 at para 47. [iii] Ibid at para 60. [iv] Corner Brook (City) v Bailey, 2021 SCC 29 at para 57. [v] Ontario First Nations (2008) Limited Partnership v Ontario Lottery and Gaming Corporation, 2021 ONCA 592 at para 62. [vi] Ibid at para 64. By Fauzan SiddiquiBlog, Commercial LitigationMarch 6, 2023June 25, 2023
Big Family Court Costs Award 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. “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.” By Fauzan SiddiquiBlog, Family LawFebruary 24, 2023July 7, 2023
Fiduciary Fallout: Ontario Court Rules Debt Survives Bankruptcy Amid Trust Fund Misuse 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. Facts Convoy 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. Analysis The 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. Held The 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 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 Owais Hashmi* Sources: Convoy Supply Ltd. v. Elite Construction (Windsor) Corp., [2022] O.J. No. 4186, 2022 ONSC 5353 By Fauzan SiddiquiBlog, Commercial Litigation, UncategorizedFebruary 21, 2023June 10, 2023
If You Do Not Make a Will, the Government Will Make One for You 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 applicable 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 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”. By Fauzan SiddiquiBlog, Wills and EstatesFebruary 15, 2023July 5, 2023