Open Courts in the Digital Era: Contextualizing the Toronto Star’s Legal Challenge to Alleged Tribunal Secrecy Recently, the Toronto Star has embarked on a legal challenge against what it describes as “blanket secrecy” within Ontario’s administrative tribunal system. At the core of their claim is today’s topic: the open court principle. The Star seeks, inter alia, a declaration that this principle applies to quasi-judicial tribunals in the same way as it does to courts, particularly with regard to tribunal records (namely, “pleadings, exhibits, legal briefs and all other documents on which adjudication is based”; see the Statement of Claim). The case raises interesting questions about the place of open courts in an era where access to information – including the very personal and very private – is more or less instantaneous and all but indifferent to geography. Open courts have long been held up as a fundamental component of not only our justice system but of the very rule of law on which our society is built. Yet when the open court principle was first articulated, its authors could not have foreseen what “openness” would mean in 2017. To the principle’s great advocates, from Jeremy Bentham to Louis Brandeis, today’s world would seem truly alien. So, do the rationales for open courts still hold up? Should we rethink the open court principle? Thinking about these questions requires a closer look at the open court principle, and it’s underlying objectives. The Principle In simple terms, the open court principle holds that court proceedings, “including the evidence and documents tendered,” must be open to the public and that juries’ verdicts and judge’s decisions must be publicly delivered or publicly available (Lukács v. Canada (Canadian Transportation Agency), FCA 2015, at para 27). The principle enjoys a strong legal foundation in Canada. The common law has long regarded the principle as integral to the rule of law. Further, as Michel Bastarache (formerly) of the Supreme Court of Canada wrote, “the open court principle gains importance from its clear association with free expression protected by s. 2(b) of the Charter” (Named Person v. Vancouver Sun, SCC 2007 at para 33). In Ontario, the Courts of Justice Act states that “all court hearings shall be open to the public”, subject to court rules, and unless “the possibility of serious harm or injustice to any person justifies a departure from [that] general principle”. Open courts also get a good press in philosophy circles. Jeremy Bentham famously wrote that, ‘In the darkness of secrecy, sinister interest and evil in every shape have full swing. Only in proportion as publicity has place can any of the checks applicable to judicial injustice operate. Where there is no publicity there is no justice.’ ‘Publicity is the very soul of justice. It is the keenest spur to exertion and the surest of all guards against improbity. It keeps the judge himself while trying under trial.’ (as quoted by the Supreme Court, here) Some, like Patricia Kosseim of the Office of the Privacy Commissioner of Canada (OPC), would argue that Bentham’s emphasis on disciplining the judiciary serves a yet more fundamental societal value: public confidence in the justice system. To Chief Justice Beverley McLachlin, in turn, this value is “a cornerstone … one of the features of all societies sharing a cultural commitment to the rule of law” (see her Honour’s 2012 speech here). Absent this public confidence, she argues, people will neither settle their disputes in courts nor obey court orders. “Practical Obscurity” and the Digital Era This rationale begs the question: what if the openness of a court or tribunal proceeding can, in fact, undermine the public’s confidence in the administration of justice? Especially in the digital era, argues Kosseim, open courts present novel privacy concerns which may discourage the public from asserting their legal rights and remedies in the first place. Consider this example: An employee is considering bringing a harassment claim before the Ontario Human Rights Tribunal. She works in a specialized field with very few potential employers. Some of the details of the incident underlying her claim might prove embarrassing if publicized and easily accessed online and might even affect her ability to secure future employment. She reasons that if pursuing the claim might make public that information, it is not worth the risk. Those advocating a rethinking of the open court principle often raise this type of scenario alongside the concept of “practical obscurity” (see, e.g., here). This concept refers to the “built-in privacy protection” that exists when trying to access court or tribunal records involves considerable effort, regardless of the fact that the records are technically open to the public. Under such circumstances, nefarious uses of one’s information will be less likely. Some view this as a practical compromise between openness and respect for privacy. Today, web-based case law databases have thrown a wrench in the cogs. While these services serve many laudable aims, “practical obscurity” cannot operate the way it used to. Notably, both pay-for-use and free databases – e.g. Westlaw and CanLII, respectively – intentionally prevent direct searches through search engines like Google. But this is a small obstacle, and some less scrupulous entrepreneurs have found ways around. If practical obscurity ever struck a balance, it’s been skewed towards publicity. From this perspective, the Star’s goal of securing easier access to tribunal records might represent a further imbalance. On the other hand, we should be mindful that open courts are not an absolute demand for the justice system. There were always exceptions, something that would appear appropriate in the context of both courts and administrative tribunals. In fact, the legal test applicable to “all discretionary actions by a trial judge to limit freedom of expression by the press during judicial proceedings” expressly requires balancing the harm and benefit of such action (see the “Dagenais/Mentuck” test, here, as affirmed and broadened here). One might argue, then, that the open court principle should apply presumptively to tribunals as well, but subject to a similar test. This is essentially the Star’s position; that this test should be applied to any restriction on access to tribunal records. Whether this is the right approach, and how exactly it might be applied, are questions we’ll have to leave to the courts. The status quo, wherein inconsistent, ad hoc rules apply to access these records, certainly leaves room for improvement. Traditional courts and tribunals are different by design, but they occupy much the same space in Canadians’ lives, and much of the same tension, namely between openness and privacy, would appear applicable to both. How differently should they be treated? Generally speaking, the Star is on to something: there is nothing trivial about secrecy sewing itself into the fabric of our justice system, or even appearing to. If the recent jump in sales of George Orwell’s 1984 is any indication, the public remains very much alive to matters of transparency and public accountability. Whether the newspaper’s position is validated will be interesting to see. In any case, with so many basic values at stake – privacy, openness, the rule of law, freedom of expression, and many others – the courts would do well to tread carefully. An important question has been put to them, and their response will echo into the future. There is a lot to consider in just about any proceeding, and our lawyers know it. If you or someone you know is in need of legal representation, please do not hesitate to contact us at 416-449-1400 in Toronto, 705-812-2100 in Barrie, or 289-638-3171 in Whitby, or send us an email at info@devrylaw.ca. “This article is intended to inform and entertain. 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.” By Fauzan SiddiquiBlog, Criminal LawMarch 7, 2017June 18, 2020
Home Prices Continue to Rise in 2017 January has brought yet another spike in home prices as the Toronto Real Estate Board (TREB) reports in the Star that January saw a 22% year-over-year increase in the price for a home. The average selling price was up $140,552 from a year ago, with the average selling price in the region being $770,745 in January. Areas that saw more growth were low-rise, detached, semi-detached and townhomes with 26-28% increases compared to last year. Even condos increased by 14.5% from the year before. It has been confirmed, however, that there still is a relatively low number of listings in the market, half of what was available last year yet, the TREB still believes this year will see gains. Gains between 10-16% and single-family homes with the biggest demand. Is this increase due to the amount of foreign buyers in our market? A question that has been asked for some time now – we now have some data to provide an answer, for the time being. A recent article answers the above question as, no. TREB calculated that 4.9% of transactions involved offshore buyers – further proving that it is the lack of supply in the region, not foreign investors. There are, however, real estate agents that challenge the above number. Some realtors can account that 20-30% of their business comes from foreign transactions. This also causes a comparison of Toronto to Vancouver to be discussed, where they underestimated the amount of foreign ownership – which resulted in the tax that brought sales down 40% in January alone compared to a year earlier. People suspect the “Vancouver experience” is going to happen here. In addition, we now have a new President of the United States, Donald Trump. Take a look at our previous article addressing the Canadian real estate market amid a Trump takeover, where we discuss the market in 2017 and what might happen now that Donald Trump is president. The findings were that Toronto was ranked 13th on the most unaffordable cities in the world list, prices have climbed 22% in Toronto, and Americans flooded the real estate pages in Toronto looking for family homes in the city, not vacation homes. Most importantly, it is too early to tell what will happen to our market now that Trump is in office. With data showing there was minimal involvement with offshore investors, Americans looking for homes in Canadian cities now that Trump is president, and the very limited supply of homes in the city of Toronto – the fear is it will continue to increase because of the lack of supply and increase in demand. All that is occurring in Toronto’s market – the foreign investment, lack of supply, high demand, amount of money home buyers have on hand to initiate bidding wars and the seemingly never-ending rise in home prices – William Strange, a professor of business economics at U of T can only sum it all up by saying, “it’s the craziness of the market.” If you have any real estate inquiries or are in need of a real estate lawyer to handle a transaction, please contact the Real Estate Lawyers of Devry Smith Frank LLP today. “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.” By Fauzan SiddiquiBlog, Real EstateFebruary 6, 2017June 16, 2020
Important Tax Information for Parents with Shared Custody A recent Canadian Tax Court Case has important implications for parents with shared custody and the way child support is paid and collected. The decision in Harder v. The Queen changes the way parents with shared custody must deal with child support. It is likely that most parents with shared custody will have to change their child support arrangements and the Family Responsibility Office will have to change its procedures to prevent running into tax problems. How Shared Custody, Child Support and Taxes Used to Work The Supreme Courts set the rules for child support in shared custody in it decision in Contino v. Leonelli- Contino. At paragraph 49 of that decision, the Supreme Court said that the starting point for calculating child support in shared custody, which persists unless it results in an unfair sharing of the costs of raising the children, is that the parents calculate what each of them would owe under the Child Support Guidelines Tables and set those amounts off against each other. In the majority of shared parenting situations, consistent with the Supreme Court’s decision, parents agreed to use set-off the child support amount such that the parent with the higher income made a child support payment that reflected the set off amount. Part of the basis of this set-off approach is that each parent gets some of the tax benefits associated with caring for the children in a shared custody situation. The amount of child support under the tables takes into account the tax deductions/benefits available to parents for having children. The CRA’s policy on tax credits and benefits for parents in shared custody situations states that when parents share custody of their children, they must rotate the benefits/credits for the children such that each parent gets the tax benefits for the children for six months of the year. That policy was last updated in July 2015. As a result of this policy, parents with shared parenting set off support against each other and each claimed half the tax benefits for the children for whom they had shared custody. The Significant Changes to Child Support to Avoid Tax Problems According to Justice Block in his tax court decision in Harder v. The Queen, the Courts, Family Arbitrators, Family Mediators, Family Lawyers and separated parents did not properly consider the Section 118(5) of the Income Tax Act in making the above-described child support arrangements. That section of the Income Tax Act states that a person who has to pay support for a dependent cannot claim tax deductions or benefits with respect to that dependent. Children are dependents. So, that means that, notwithstanding the Canada Revenue Agency saying that benefits must be rotated in shared custody situations, a parent paying child support may not claim those benefits. Based on the Supreme Court’s decision in Contino about setting off support in shared parenting, and the CRA’s policy that benefits be rotated in shared parenting, it seemed logical to interpret the “set-off support” paid in shared custody situation as parents notionally paying each other, but simplifying the logistics of that by having the payments flow only one way – from the higher-income parent to the lower-income parent. This is how child support orders and agreements were written and how the FRO processed support. However, in Harder v. the Queen, Justice Block stated that interpretation was wrong under tax law. Where parents set-of child support amounts, this resulted in only one parent receiving support and one parent paying support. Under the wording of section 118(5) of the Income Tax Act, the parent paying support could not claim the benefits and credits in relation to the child or children for whom that parent was paying child support. According to the decision in Harder v. the Queen, the correct thing to do is for each shared custody parent to actually pay the full table child support amount to the other parent so that the full table support is flowing both ways. The Family Responsibility Office should collect the full child support amount payable by each parent and pay it to the other parent, essentially having the support between the parents cross paths as doing a “set off” will have negative tax consequences for at least one of the parents. There are some obvious practical problems with the approach set out in Harder v. the Queen. For example, a lower-income parent may not have the funds available to make the support payment until receiving the support from the higher income parent. That would cause one of the support payments to “bounce” and one parent to “overpay” by not getting the support back to which he or she is entitled. It will also dramatically increase the cost for the Family Responsibility Office, and the support collection agencies in other provinces, to enforce child support in shared parenting arrangements. However, as Justice Block points out, this complicated and tedious approach to child support in shared parenting is required by section 118(5) of the Income Tax Act and it is the way things must be done until Parliament changes the law. 32 – How to Change a Support Order Justice Block’s decision in Harder v. the Queen means that most parents with shared custody will have to change what they are doing for child support. It may also mean that they have to change their child support order or separation agreement to reflect how the Income Tax Act requires child support to be paid so that both parents can get the tax benefits related to raising the children. The Ontario Family Law Podcast and this video give some general advice about how to change a support order or agreement. However, the rules for separation agreements require that separated parents and spouses consult with a family lawyer, and they will probably speak to a lawyer who understands both family law and tax law to make sure the agreement or court order does what they expect. Obviously, parents who have just separated and who are planning on sharing custody of their children will want to make sure that their child support order or separation agreement complies with the requirements to maximize the tax relief for them. Again, they should contact an excellent family lawyer to make sure that happens. To learn even more about child support, get a copy of this easy to understand book on the basics of Ontario Family Law as a paperback, or download it immediately as a $9.99 e-book for Kindle, Kobo, or iPad/iPhone/Mac. You may also want to listen to this podcast or watch this video. You can also use the search on the right to find lots more articles about marriage and divorce. Obviously, there can be a lot of money involved in child support cases and only could really help a child with his or her needs (or not). You need to get the help of a lawyer immediately to avoid financial hardship. Contact Certified Specialist in Family Law (and author of the book above), John Schuman, by emailing him or by calling 416-446-5847. We answer all inquiries promptly and we can arrange for you to come in quickly for a consultation (charged at a reduced hourly rate). By Fauzan SiddiquiBlog, Family Law, TaxJanuary 30, 2017June 16, 2020
Renting in Ontario: What Every Pet Owner Needs to Know There is a lot of confusion when it comes to renting a property in Ontario with pets. Many Ontarians believe it is illegal for landlords to discriminate against pet owners and that landlords cannot reject potential tenants for their pets. This is incorrect. Landlords have the right to reject tenants if they suspect they will move in with pets. Landlords are free to screen and investigate whether or not their prospective tenants have pets. However, once a landlord accepts a tenant, in spite of any verbal agreements or contract stipulations, landlords cannot evict tenants for pet ownership under most circumstances. As stated in section 14 of the Residential Tenancies Act “A provision in a tenancy agreement prohibiting the presence of animals in or about the residential complex is void.” This means once a tenant signs a contract with a landlord, despite any provisions that limit pet ownership or promises made to the landlord, a landlord is powerless to enforce any provisions regarding pet ownership. However, this right is limited and certain conditions exist where landlords possess the right to evict tenants with troublesome pets. If a pet is dangerous, disturbs neighbours, or causes damage to property, landlords can evict the tenant. The most common pet complaint is in regards to allergies. If another tenant suffers severe allergies and is affected by a pet, the owner must find a way to ensure that their fellow tenant is not disturbed, or face the risk of eviction. In order for a landlord to take action, the landlord first must bring the issue to the attention of the tenant and the tenant has the ability to mitigate the issue. If there is damage done to the property, the tenant can opt to repair the damage. If the animal is disturbing neighbours, the tenant might prevent the animal from being outside and limit its exposure to neighbours, if the animal is upsetting a fellow tenant’s allergies due to fur contaminating the communal laundry machine, the pet owner can do their laundry elsewhere. Finally, for an eviction to take place, the landlord must obtain an order from the Landlord and Tenants Board of Ontario. Drewlo Holdings Inc. v. Weber, 2011 ONSC 6407 has made it clear that landlords cannot use other contractual stipulations to harm or force tenants out of their properties due to their pet ownership. In this case, a landlord tried to increase rent for all of the pet owners renting his property, but not for any of the non-pet owners. The Court found that this was interfering with the right to reasonable enjoyment of the property by the tenants and detracted from their ability to lawfully use their property. What this means is that landlords must be value-neutral when it comes to pets. If pets impair the enjoyment of other tenants, then the tenant can be penalized. Similarly, if the tenant’s pet is causing damage to the property, the tenant can be sanctioned. If there is no damage, financial or otherwise, the landlord has no grounds to penalize a tenant with pets. One area where these provisions do not apply is for condominiums. Condominiums in Ontario, as regulated by the Condominium Act, are allowed to pass bylaws that prevent its owners from living with pets. Condominiums are given the right to create their own regulations on safety, welfare and enjoyment of property, which has given them the authority to regulate pet ownership. The regulation must be explicitly stated in the condominium’s declaration. As more and more rental apartments in Toronto are in Condominiums, renters need to be aware that if their rental property has such bylaws, their pets might be prohibited from their apartment. It is important to also note that in Ontario, landlords cannot ask that a tenant provide payment other than first and last month’s rent. If a landlord requires a security deposit in exchange for consenting to pet ownership, it is illegal and cannot be enforced. If a tenant, however, offers a landlord to pay a security deposit in exchange for allowing them to move in with pets, one cannot renege on this agreement and this provision will be upheld. Another caveat to this is that most municipalities in Ontario have their own restrictions on the number of pets that can live in any individual home. In Toronto for example, no dwelling can house more than three dogs or more than six cats. If you require assistance or would like more information regarding issues like this, please contact Devry Smith Frank LLP and we’d be happy to assist you. “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.” By Fauzan SiddiquiBlog, Real EstateJanuary 27, 2017June 16, 2020
Leaning on Liens for Payment Construction and renovation work can sometimes involve multi-layered contractual relationships between the various players in a construction project, where there are numerous complex areas of consideration. An owner or developer may hire a general contractor, who will then contract with subcontractors for various jobs such as carpentry, plumbing, and electrical work. In the same way, subcontractors may hire sub-subcontractors, those sub-subcontractors may hire sub-sub-sub contractors, and so on. This is often referred to as the “construction pyramid”. The pyramid dictates not only who works for whom, but also who pays whom: the owner pays the general contractor, who then pays its subcontractors, and who in turn pays the sub-subcontractors, all the way down to the bottom. One of the purposes of the construction lien is to ensure that the general contractor and any subcontractors down the pyramid are remunerated for the services and materials that they have supplied towards improvement, as stated in a recent discussion regarding proposed changes to the Construction Lien Act. Thus, a lien secures the payment that is due to the general contractor and subcontractors. A lien is one means of enforcement provided under the Construction Lien Act that allows a contractor the ability to potentially take steps to sell the property and gives the contractor and subcontractors priority over certain creditors who may have claims against the owner of the property. As soon as a contractor begins providing services or materials to improvement, it has a lien for the value of services or materials actually supplied to the improvement. However, that lien will expire unless certain steps are taken: (1) the lien must be “preserved”; and (2) the must then lien is “perfected”. To preserve a lien, a contractor must register it on the title to the property where the work was done. To perfect the lien requires the contractor to commence an action and register a certificate of action on the title to the property. There are strict deadlines for the preservation and perfection of liens, typically triggered by either the date of last supply or the publication of a certificate of substantial performance, although the complete framework for the timing of preservation and perfection of liens is somewhat complicated and depends on when the work was actually performed. Once a lien has been perfected, the action by which it was perfected must be set down for trial within two years of having been commenced otherwise the lien will expire (although the legal action itself may continue). For more information or any other questions regarding construction liens, please contact our construction lawyers. “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.” By Fauzan SiddiquiBlog, Real EstateJanuary 20, 2017June 16, 2020
Off-Duty Conduct: Can you be Terminated over Tweets? Toronto Arbitrator Elaine Newman says you can. On November 12, 2014, the Ontario Labour Relations Board upheld the City of Toronto’s dismissal of Matt Bowman, a firefighter with 2.5 years of service, for inappropriate use off-duty use of his Twitter account. Bowman’s Twitter account included a picture of himself posing in a Toronto Fire Services (“TFS”) uniform. Three of his tweets, published in an article by the National Post, read: “Reject a woman and she will never let it go. One of the many defects of their kind. Also weak arms.” “I’d never let a woman kick my ass. If she tried something I’d be like hey! you get your bitch ass back in the kitchen and make me some pie!” “The way to a woman’s heart is through anal.” When the employer became aware of the offensive tweets, they suspended Bowman with pay pending an investigation. Bowman produced a letter of apology for his first interview with his employer and later completed a course in sensitivity training. During the course of the employer’s investigation, further offensive tweets were discovered. The tweets were found to be overtly racist or demeaning to women, ethnic minorities, homeless persons and persons with disabilities. The employer alleged that Bowman’s tweets violated the employer’s human rights and social media policies and guidelines and harmed the reputation of TFS. TFS had recently launched a program through which is intended to increase the recruitment of female firefighters and those that represent the diversity of Toronto’s population. In her analysis, Arbitrator Newman recited the test established in Re Millhaven Fibres Ltd. v. Atomic Workers Int’l Union, that provides that in order to uphold a dismissal on the basis of just cause arising out of off-duty conduct, there is an onus on the employer to prove that: the conduct of the employee harms the employer’s reputation or product; the employee’s behaviour renders the employee unable to perform his duties satisfactorily; the employee’s behaviour leads to refusal, reluctance or inability of the other employees to work with him; the employee has been guilty of a serious breach of the Criminal Code and thus rendering his conduct injurious to the general reputation of the employer and its employees; places difficulty in the way of the employer properly carrying out its function of efficiently managing its works and efficiently directing its working forces. Arbitrator Newman confirmed that the test requires an employer to prove any one of the above-noted criteria. Newman noted that, over the past 4 decades since the Millhaven test was devised, cultural awareness and sensitivity in Canada has grown, along with the diversification of its communities and workplaces. As such, she expanded the fourth branch of the Millhaven test above to include a serious breach of human rights policies or the Human Rights Code. The question to be asked is this: Would a reasonable and fair-minded member of the public, if apprised of all the facts, consider that Bowman’s continued employment would so damage the reputation of the employer so as to render that employment untenable? Arbitrator Newman considered Bowman’s apology and candour at length. She found that he was not forthcoming, disclosed information selectively and was not fulsome in many of his responses. She also found that he was not candid or cooperative during the employer’s investigation. Arbitrator Newman also considered the severity of Bowman’s conduct: she found that Bowman’s comments violated a number of fundamental workplace policies, that he promoted forms of discrimination intentionally among his followers and recklessly made this promotion available to the general public. She noted that his conduct was not an isolated incident, but that it was a course of conduct and took place over a period of about two years. Arbitrator Newman found that actual damage to the employer’s reputation was caused by the National Post articles and their fallout and found potential damage has been caused to the employer’s ability to carry out its work, which includes implementation of its diversity initiative. In determining that dismissal was the appropriate penalty, in this case, Arbitrator Newman stated, “[Bowman] does not absolutely accept the proposition that his comments were offensive. He has said, repeatedly in his evidence, that ‘he can see how someone might consider them offensive.’ His words ring hollow. They do not reflect a real appreciation of the degree to which his comments offend.” The Arbitrator held that Bowman’s conduct harmed the reputation of his employer and impaired his ability to fulfill the complete range of responsibilities of a firefighter. She stated, “The job involves more than attending at a fire, or attending as the first responder when someone calls 911 for a medical emergency. It involves more than performing life-saving interventions that he has learned and practiced. The other part of the job, the part that I am not convinced he can perform to satisfaction, is the part that requires him to conduct himself in a way that brings honour to the uniform. I have to wonder if a deaf person, a woman in labour, a homeless person, a member of a visible minority group, apprised of his comments, would welcome this man into their home in a time of need.” Arbitrator Newman’s Award may be found here. What should employers take from this decision? the importance of implementing and maintaining human rights and social media policies in the workplace off-duty breaches of employers’ human rights policies or the Human Rights Code may be found to harm the employer’s reputation and be grounds for just cause dismissal certain types of employees, for example, firefighters, nurses and police officers may be held to a higher standard than other employees whose work is less intimate and does not involve serving the public or being in a position of trust Be careful what you tweet! Contact a member of the Employment Law group at Devry Smith Frank LLP to develop and update your workplace policies, including human rights and social media policies. “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.” By Fauzan SiddiquiBlog, Employment LawJuly 17, 2016June 16, 2020
Time of Essence Clause in Real Estate Transactions Remember that time when you made a reservation for a restaurant but later forgot about it or changed your mind right before? And then you breathed a sigh of relief knowing the restaurant will never know who you are and you will not have to pay a fine for going back on your word. Although a rather large leap, the same cannot be said for real estate transactions. Almost invariably in Canada, a contract of sale for a piece of real estate property will expressly provide that time is of the essence. So if you change your mind about purchasing the property or cannot attain suitable funding in time for the closing date, for instance, you may be liable for damages and have the contract come to an end. However, there are several important things to note: You cannot rely on the clause unless you have demonstrated that you are ready, willing, and able to complete the agreement. In other words, if both parties are not ready to close on a real estate transaction, neither party can immediately rely on the clause to bring an action for specific performance, damages, or termination of the contract. Similarly, you must proceed diligently to fulfil your obligations, and not act in bad faith by interfering with the other party’s ability to fulfil their responsibilities. Further, a clause providing for the time of essence in a contract of sale can be negated largely in three different ways: Waiver: If one party in a contract takes action that makes it clear that the strict contractual provisions will not be enforced. For instance, if both parties agree to extend the closing date by two days then there is a waiver. Election: When one party breaches the contract and for instance does not have the requisite financing completed on the closing date, the other party could agree to extend the closing date. Bad faith: As discussed earlier, if the transaction fails to close because of one party’s lack of action or bad faith, that party cannot rely on the time of essence clause. So just remember – take more care and time in entering into an agreement to purchase real estate than you would for where will you have dinner tonight. For more information or any other questions regarding real estate transactions, please contact our real estate lawyers. “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.” By Fauzan SiddiquiBlog, Real EstateJuly 16, 2015June 16, 2020
Canada Revenue Agency (CRA) Offers Advice for Settling Tax Dispute Claims, Part 1 On June 19, 2014, the Canadian Tax Foundation (“CTF”) held an event titled “Tax Dispute Resolution: an Inside Look from the Government’s Perspective.” Devry Smith Frank LLP (“DSF”)’s tax litigation team attended the event to better assist its corporate and personal clients to resolve their disputes with the Canada Revenue Agency (“CRA”). Part one of this three-part article series begins with Ms. Anne-Marie Lésvesque, Assistant Commissioner of Appeals for the CRA: CRA has a two-year backlog of ongoing donation tax credit disputes Ms. Lésvesque, speaking for the CRA, explained that the timely resolution of disputes is made more difficult by an imbalance between resources dedicated to the CRA’s appeals unit and the number of ongoing disputes. As an example, Ms. Lésvesque explained that the CRA is currently dealing with a glut of 175,000 donation tax credit disputes. In a regular year, the number is closer to 50,000 to 60,000. Ms. Lésvesque estimated that it would take one to two years to eliminate this backlog. In the meantime, tax litigation lawyers like those at DSF can work with you to protect your rights while moving your tax dispute closer to resolution with the CRA. Avoid commonly used arguments that are commonly unsuccessful Speaking from the CRA’s perspective, Ms. Lésvesque also suggested that repetitive appeals such as the “natural persons argument” have increased in popularity but are not succeeding at the appeal level or in tax court. Toronto tax lawyers like DSF’s own save their clients time and money by refusing to put forward “fad” arguments that are unlikely to be successful. Cases of legal interpretation are more likely to go to trial Ms. Lésvesque also shared that while the CRA appeals process must be viewed as impartial, it is legally bound to follow the CRA’s published interpretation of the Income Tax Act(the “Act”). Settlement in cases where the CRA’s and taxpayer’s interpretation of the Act are different are more likely to go to trial. In contrast, the CRA is far less likely to go to trial where the facts are in dispute. Ms. Lésvesque explained that where there are issues of credibility, the taxpayer should have the benefit of the doubt, at least in his or her first dispute with the CRA. Tax lawyers at DSF can help taxpayers put forward their best case when explaining why the CRA has made errors in its tax reassessments or enforcement measures. Ms. Lésvesque suggested that the CRA’s success rate at trial is currently 80%. Having a great lawyer on your side can increase the odds both for early settlement and success at trial in your tax law case. Stay tuned to the Devry Smith Frank LLP tax litigation blog for part two of this series that discusses what the Department of Justice’s former Senior Counsel had to say about settling tax dispute claims at this event. As always, for any tax law related matters in Toronto, Ontario Canada, contact Devry Smith Frank LLP at 1-416-446-1400. “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.” By Fauzan SiddiquiBlog, TaxJuly 31, 2014June 10, 2020