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Lecture 1

LAW 122 Lecture 1: Week 1

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Law and Business
LAW 122
Nick Iannazzo

LAW 122 Thursday, January 19, 2017 Chapter 1 – Risk Management and Sources of Law WHY STUDY LAW?  Many factors affect the success/failure in business such as decision-making which includes location choice, product, marketing.  People study it because legal factors affect the profits and losses in a business.  Also, for every business decision, there is a legal consequence. Risk Management  Legal education plays a critical role in risk management, which is the process of identifying, evaluating, and responding to the possibility of harmful events.  The goal is NOT to eliminate risks, but to manage it using the following strategies:  Risk Avoidance – Some risks are so serious that they should be completely avoided.  i.e. Automobile regularly explodes upon impact  Risk Reduction – Some can be reduced to an acceptable level through precautions.  i.e. Bank protecting itself again loans that may not be repaid.  Risk Shifting – A risk can be shifted onto another party.  2 strategies for shifting risk are insurance and exclusion.  Risk Acceptance – Sometimes it’s appropriate to simply accept the risk.  Insurance is a contract in which one party agrees, in exchange to a price, to pay a certain amount of money if another person suffers a loss.  Liability insurance provides a benefit if the purchaser is held liable for doing something wrong.  Property insurance provides a benefit if the purchaser’s property is damaged, lost, or destroyed.  Exclusion can be seen in contacts, in which certain clauses may changes the usual rules of liability and may attempt to exclude all risk of liability. Example: Ex-Employee Case  An ex-employee wants a reference letter. She doesn’t know you have a low opinion on her b/c you think she stole money. The company she wants to join is one of your best customers. Will you write a reference letter? If so, what will it say?  You would need to identify, evaluate, and respond to the legal risks involved:  Identification – Accusing her of theft may lead to her suing you for defamation because your statement would cause someone to think less of her. If you unreasonably refuse to write one or write a brief letter, you may be held liable for reducing the person’s job prospects. You need to be concerned about liability.  Evaluation – B/c of the risk of being sued for defamation, you may decide that a candid letter also wouldn’t be legally acceptable. LAW 122 Thursday, January 19, 2017  Response – Having identified and evaluated the risk, you can refuse to write the letter, write a letter that doesn’t mention your suspicions, or one that does. The choice is yours and you are now in a position to make an informed decision. AN INTRODUCTION TO THE LEGAL SYSTEM The Nature of Law  A law is a set of principles and rules that a court will enforce.  It’s bound up in the reasoning, meaning it’s important to ask why and how. It’s not a matter of the result of a case, meaning who won. Law as. Morality Ethical Reasoning  Focuses on WHY something’s ethically right or wrong, not just if it’s right or wrong.  There are 4 types of ethical reasoning: 1. Consequences: The greatest good for the greatest number  i.e. Yuri dying for Carlos and John 2. Justice & Fairness: Give people their just desserts, pay your debts, maintain a level playing field. 3. Rights & Duties: Respect rights and perform your duties. 4. Character & Virtue: What kind of person do you want to be? If I do this, can I look at myself in the mirror? How would I feel if it was in the newspaper? A Map of the Law LAW 122 Thursday, January 19, 2017  Civil law jurisdictions (written laws) trace their history to ancient Rome.  i.e. France and most of Europe, Louisiana, and Quebec  Common law (judge-made laws) jurisdictions trace their history to England.  i.e. England, Australia, New Zealand, most of Canada  Some laws are the same across Canada, such as criminal laws and constitutional laws. Public and Private Law  Public law is concerned w/ governments and the way in which they deal with citizens.  Constitutional Law – Proves the basic rules of our political and legal systems  Administrative Law – Concerned with the creation and operation of administrative agencies, boards, commissions, and tribunals.  Criminal Law – Deal with offences against the state.  Tax Law – Concerned with rules used to collect money for public spending.  Private law is concerned with the rules that apply in private matter.  Law of torts (private wrongs), law of contacts, and law of property. SOURCES OF LAW 1. The Constitution 2. Legislation: laws created by Parliament or Legislature 3. Courts 1. CONSTITUTION  It’s the most important courts of law that provides basic rules for society, including our legal and political systems.  Every law must be compatible with it and it’s hard to change b/c it requires consent of both Parliament & Legislatures of 2/3 of all provinces w/ at least 50% of population LAW 122 Thursday, January 19, 2017 Division of Powers  Canada’s a federal country because it has 2 levels of government: 1. Federal – Parliament of Canada governs the country as a whole. Composed of 2 parts: The House of Commons, consisting of member of Parliament (MPs), whom are elected, and The Senate, consisting of Senators, whom are appointed. 2. Provincial and Territorial – Canadians elect politicians to represent them within their provinces/territories. The elected body, or legislature, is called the Legislative Assembly.  Wherever you live in Canada, you are subject to two sets of laws, federal and provincial. The Constitution establish a division of powers by identifying the areas in which each level of government can act.  Federal government is crime, bankruptcy, copyright, etc., whereas provincial government is more property, civil rights, health, school,  Residual power is when the federal government has authority over any matter that isn’t exclusively given to the provinces. Charter of Rights and Freedom  It was introduced in 1982 to protect the basic rights and freedoms, such as the following:  Freedom of religion, of express, of mobility, right to equality… Limitations On Charter Rights  Government Action – It was introduced to govern the relationship b/w the individual and the state. It doesn’t apply to disputes involving private parties.  Corporations – It generally doesn’t apply against private corporations. It may not apply in favour of them either. It depends on the circumstances.  Reasonable Limits – It states that its right and freedoms are subject to “such reasonable limits” meaning it recognizes that it’s occasionally acceptable to violate a person’s rights.  Notwithstanding Clause - Government can override some rights and freedoms although this is rarely used. Charter Remedies  Declaration – A court may declare that the Charter has been violated. The legislature must then find some solution to the problem.  Injunction – A court may impose an injunction that requires the gov. to address the problem in a certain way. The choice lies with the judge, rather than the legislature.  Severance, reading down, reading in – Court may save a statute by re-writing part of it. If only one part of a statute is offensive, it can be severed out. If it’s written too broadly, it may be read down so it applies only where it can be justified and vice-versa for read in.  Damages – A plaintiff who wins a private lawsuit usually receives damages for the injuries or losses suffered. 2. Legislation LAW 122 Thursday, January 19, 2017  The Legislative Process – A bill is introduced into the House of Commons by an MP  If majority supports it, it passes the first reading.  It would re-appear for second reading, when it’s the subject of debate amongst the MP  If majority support it again, it’s sent to a legislative committee for detailed study  It will re-appear for third reading, when the MPs take a final vote  If it passes, it’s sent to the Senate, where the three-stage process is repeated  If it’s passed by Parliament, it must receive royal assent, which is the approval by the Queen.  It’s impossible for Parliament and legislatures to monitor all of their legislation, so statutes set up basic structure but allow others to create specific rules w/o the need to go through the legislative process. Those regulations are known as subordinate legislation. 3. The Courts  Judges must interpret & apply words that appear in the Constitution and in legislation.  Common law has 3 diff. meanings, depending upon whether it refers to a system of law, a source of law, or a type of court. Chapter 2 – Litigation andAlternative Dispute Resolution  Litigation is the system of resolving disputes in court. It’s a poor way to settle disputes b/c it’s usually expensive, often unpredictable and fatal to business relationships. THE LITIGATION PROCESS Who Can Sue and Be Sued?  All adults are free to use the Canadian courts, whether or not they are Canadian citizens.  A corporation is a type of person; therefore, it may also sue or be sued. Class Actions  It allows a single person or small group, to sue on behalf of a larger group of claimants.  This allows small individuals to take on large organizations and may save society money as it’s cheaper to deal with thousands of similar claims once.  7 provinces have legislation dealing with class actions, and the basic ideas are: LAW 122 Thursday, January 19, 2017  Common Issues – There must be common issues amongst the various members of the class. It doesn’t have to be completely identical though.  Representative Plaintiff – Plaintiff must demonstrate a workable plan for fairly representing the interests of the class members.  Notification – A representative plaintiff must have a workable plan for notifying potential class members.  Preferable Procedure – The court must be convinced that a class action is the preferable procedure for dealing with the claims.  Certification – It represents the court’s decision to allow the various claims to be joined together and to proceed as a class action. LEGAL REPRESENTATION Self-Representation  You have the right to represent yourself. You can go into court and argue your case before a judge and in some situations, it makes sense to do so. Lawyers  Hiring a layer provides you with help and may increase your likelihood of success.  People can’t act as lawyers until they graduated from law school, completed an apprentice period known as a period of articles, and passed the bar.  The Law Society regulates the profession by imposing codes of conduct and punishing members who act improperly.  They require every lawyer to hold professional liability insurance, meaning if your lawyer acts carelessly and you lose, you may sue.  If the lawyer doesn’t have enough money to pay for that loss, PLI allows you to receive compensation from the lawyer’s insurance company.  Law societies also create assurance funds, which provide compensation to people who have been hurt by dishonest lawyers. Paralegals  A paralegal is not a lawyer but provides legal advice and services. They are particularly common in small claims courts and landlord and tenant tribunals.  They are confined to certain types of work and may provide advice and draft documents in connection with those cases.  They can’t appear in other types of cases, nor can they perform services that are restricted to lawyers, such as drafting wills or handling real estate transactions. PLEADINGS  They are documents used to identify the issues and clarify the nature of a dispute.  Some are prepared by the plaintiff, while other come from the defendant.  The plaintiff is the person who’s making the complaint.  The defendant is the person whom the complaint is being made.  It’s important to start the pleadings process promptly as most claims are subject to limitation period, which is a period of time within which an action must be started. LAW 122 Thursday, January 19, 2017  Claims in contract must commence within 6 yrs., claims in tort within 2 yrs.  The relevant period may vary from days to decades outside of the general limitation provisions. i.e. Up to 20 yrs. to sue someone for occupying your land. 1. Lawsuit starts with a statement of claim, which is a document in which the plaintiff outlines the nature of the complaint. 2. Once a party is served with a statement of claim, they must react quickly b/c if the defendant does nothing within the relevant period (usually a month), the plaintiff may go to court alone and receive a default judgement. 3. If the defendant intends to deny liability, the should prepare a statement of defence, which is a document in which the defendant sets out their version of the facts.  They may also include a counterclaim, which is a claim that the defendant makes against the plaintiff. 4. The plaintiff is entitled to respond to the defendant’s pleadings and may use a reply if they want to dispute anything in the statement of defence or a statement of defence to the counterclaim, if they received a counterclaim.  A demand for particulars requires the other side to give additional info when parties may still not be entirely sure what the other side has in mind. PRE-TRIAL ACTIVITY  A case doesn’t go t
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