Ch 1: Risk Management and Sources of Law
Why Study Law?
RISK MANAGEMENT- the process of identifying, evaluating, and responding to the possibility of
o Insurance- a contract in which one party agrees, in exchange for a price, to pay a
certain amount of money if another party suffers a loss
Liability Insurance- provides a benefit if the purchaser is held liable for doing
Property Insurance- provides a benefit if the purchaser’s property is damaged,
lost or destroyed
o Exclusion and limitation clauses- contractual term that changes the usual rules of
May attempt to exclude all risk of liability, or it may exclude liability for certain
types of acts or certain types of losses, or it may limit the amount of
compensation hat is available.
o Incorporation The benefit of incorporating is limited liability.
An Introduction to the Legal System
THE NATURE OF LAW
Law- a rule that can be enforced by the courts
A MAP OF THE LAW
Civil Law systems- trace their history to ancient Rome
Jurisdiction- a geographical area that uses the same set of laws
Common Law system – trace their history to England
Quebec laws are different from the rest of Canada asides of criminal and constitutional laws. Public Law
Public Law- concerned with governments and the ways in which they deal with their citizens
Constitutional Law- provides the basic rules of our political and legal systems
Administrative Law- concerned with the creation and operation of
administrative agencies and tribunals
Criminal Law- deals with offence against the state
I.e. white-collar crimes, corporate crime
Tax Law- concerned with the rules that are used to collect money for the
purposes of public spending.
Private Law- concerned with the rules that apply in private matters.
o 3 main parts:
Law of torts
Torts- a private wrong
Intentional Tortsassault, false imprisonment
Business Torts deceit, conspiracy Negligence covers most situations in which one person
carelessly hurts another.
Law of contracts- concerned with the acquisition, use, and disposition of
Sales of goods, use of negotiable instruments (cheques), real estate
transactions, operation of corporations, employment relationship
Law of property- concerned with the acquisition, use, and disposition of
3 main parts
Real property land and things attached to it
Personal property involve things that can be moved from one
place to another
Intellectual property things that consist of original ideas
(patent and copyrights)
Laws that deal with all types of properties
1. Law of succession distribution of a person’s property after
2. Law of trusts deal with a situation in which one person holds
property on behalf of another
Different area of laws could overlap.
SOURCES OF LAW
3 sources of law:
o The Constitution
o The courts
The Constitution- the document that creates the basic rules for Canadian society, including its
political and legal systems
o All other laws must be compatible with it.
o Constitution is very difficult to change.
Division of Power Federal 2 levels of gov.
o Parliament of Canada (Ottawa) 2 parts
House of Commons member of Parliament (MPs), elected from every
province and territory
Senate senators, who are appointed to those jobs
o Head of State: Queen of England
o Reality: ruler is the political party with the most MPs leader : prime minister
o Provincial and territorial:
Legislative Assembly (aka. Legislative) leader is premier
Represent within the province or territory
Sections 91 and 92 of the Constitution establish:
Division of Powers- states the areas in which each level of gov. can
Residual Power- gives the federal gov. authority over everything that is
not specifically mentioned
Doctrine of federal paramountcy- determines which law is pre-eminent based on
the Constitution’s division o f powers.
Charter of Rights and Freedoms protect basic rights and freedoms
Democratic rights (Sections 3-5)
Legal rights that usually arise in criminal cases (Sec. 8-14)
Official languages and minority language education (Sec. 16- 23) Aboriginal and multiculturalism (Sections 25-27)
3 fundamentals: for individuals and businesses
o Fundamental Freedoms:
2 Everyone has the following fundamental freedoms:
a) freedom of conscience and reli