Biz Law II Lectures
Lecture 1: pg. 4079
Provincial structure: Supreme Court ▯Provincial courts of appeal (1) ▯trial courts (many)
Federal structure: Supreme Court ▯One federal court of appeal ▯many trial courts
Trial: with the jury, and evidence and two lawyers discussing facts and law. If you
disagree with the way the judge dealt with the law, you have the right to appeal.
Appeal: two lawyers, one for each side, arguing a point of law before a judge and then the
court gives a decision. We have a right to appeal a court of appeal; you can only appeal
matters of law, not fact.
Supreme Court of Canada is an appeal court
The Doctrine of Precedent: the principle that similar cases should be decided in the same
manner. We do this because it creates consistency and predictability – for the lawyers
they can tell a client if they will win or not. The decision of a higher court is binding
authority on a lower court within the same province.
In other provinces, the decisions are not binding on lower courts, but the other
provinces’ decisions are very persuasive to the case.
We allow higher courts to not follow their own precedent, or the law would never
No two cases are ever identical, so you need to decide whether the facts of the
latter case are sufficiently similar to the earlier case so as to invoke the doctrine of
precedent and yield a similar result (distinguishing facts)
If the judge found the precedent case should be distinguished, you can appeal
because it was an error in law and not fact.
Ratio Descendi “the reason for the decision – why was this decided)”: Even
when a decision of a higher court is binding on a lower court, it’s not the entire
decision that’s binding. The part of the decision that’s binding on the lower court
is the ratio. It’s a combination of facts and law. What is the ratio of the precedent
case? How much is the judge bound by when it comes to this certain case
according to other cases in the past?
Obiter Dicta: everything in a decision that isn’t ratio, including immaterial facts,
hypothetical situations and other material, is “obiter”. Part of interpreting legal
decisions is figuring out what’s ratio and what’s obiter. All of a case can be
separated in to ratio and obiter.
Why did the Canadian Legal system adopt the doctrine of precedent?
Malette v. Shulman: the blood transfusion that a doctor gave a jehovah’s witness, she had
a card saying she didn’t want one if necessary. The doctor over rode the decision and
gave her a blood transfusion. She woke up and was horrified and sued for battery and
was awarded $20,000 in damages.
Fortey v. Canadian: A minor was intoxicated and wounded on the side of the road, police
officers saw him and offered to send him to the hospital, and the minor refused and
instructed them to leave. The police abided and the young man sued for negligence and
Hill v. Church of Scientology of Toronto: The lawyer of the church of scientology
defamed (libel) the lawyer of the government of Canada in a different lawsuit. So Casey
Hill sued them in a different lawsuit and won. The case shows the defendants arguments
and the response of the court.
One of their last arguments was to use the New York Times v. Sullivan “actual
malice” rule. In the U.S Supreme Court the law of defamation is this principle; if
the defendant didn’t know the statements were false and acted without malice
then they are not liable for defamation; but the supreme court of Canada in this
case, rejected that reason. They argued that whether or not they knew if was false,
they were reckless to discover if it was false or not.
Manning uses qualified privilege: which means a lawyer, when fighting for his
client, cannot be sued for defamatory comments when conducting a defense. The
court rebuts and argues that he was calculated in all of his actions and were
calculated to cause harm to Mr. Hill and therefore, there was no qualified
Damages = 1.6 million + costs (Mr. Hill’s lawyer fees were mostly paid for)
What was the Ratio (reason for the decision): That there was actual malice,
Manning got no qualified privileges.
Hodgson v. Canadian Newspapers: The Globe and Mail went to the Ontario court of
Appeal, because they didn’t want to pay punitive damages that were awarded to the other
party in the trial court. The Appeal Court reviewed Hill v. Church of scientology and
acknowledged the trial court made a mistake and took away the punitive damages.
A Plaintiff’s lawsuit = claim
A Defendant’s lawsuit against the plaintiff = counterclaim (they become plaintiff
in this situation and the original plaintiff becomes the defendant)
Cross claim – names 3 party defendant
In an Appeal the people involved are the appellant (party who first initiates the
appeal) and the respondent – an appeal is dismissed or allowed, if it’s dismissed
the appellant has lost. If the appeal is allowed, the court below got it wrong. Absolute privilege: Inside the house of commons among parliamentarians are allowed to
say whatever they want in a debate in house of commons and can’t ever be sued. If they
make false statements, they are allowed to make defamatory comments.
Lecture 2 – Tort Law cont’d and Contract Law
Guardian ad Litem – means that they are a minor
Parlee (Guardian ad Litem) v. Port of Call Holdings Ltd. : This took place in the British
Columbia Supreme Court, which is a trial court but this is an appeal. We have a trial court
acting in an appellant capacity (appeal) because the case started at a small claims court,
and it’s so small that when it’s appealed it goes to a trial court and not an appeal court.
The small claims court dismissed the act and they appealed it and Parlee received
damages of $500
A minor, Parlee; was detained in a store for being thought of drinking milk and
then putting it back. The store clerk saw him and detained him. Parlee sued for
Two facets of law: 1. You have to believe the crime was committed (subjective
test). 2. Belief had to be reasonable (objective test)
But the manager admitted he wasn’t convinced he stole the milk, but he as
detaining him to investigate whether he stole the milk or not.
Judges have to act dispassionately. Judges can’t decide whether they like people
or not, judges apply the law to the facts. He found there was so lawful citizen’s
John et al. v. Flynn et al: Flynn was drunk and hit John in a car. Instead of just suing
Flynn, John sued Flynn and his employer. John loses the case because the court said there
was no duty of care owed to John by the employer. John used vicarious liability, but
Flynn made it home safe from work but left once he got home to go somewhere else and
This is obiter of the court of appeal so it’s persuasive in terms of precedent, but
it’s still not the ratio, it’s not binding on lower courts.
Arndt v. Smith: A woman goes to the doctor because she has chicken pox while being
pregnant. He failed to warn her that her chicken pox could affect her pregnancy and cause
the child to have severe birth defects. He did not warn her and she had the baby, and the
baby had severe birth defects. She sued the doctor for negligence because he owed her a
duty of care.
But there was no evidence that if she had been warned she wouldn’t have had the
baby. The court agreed there was a breach of duty but failed to prove the breach
caused her loss.
The court argued that the outcome would’ve been the same.
She couldn’t prove he caused the injuries by his behavior
Burden of proof is on the plaintiff, if you can’t prove causation you fail to prove
an important aspect of negligence. Mortimer v. Cameron: two guys who were at a party and they were play fighting. The
fight spills out off the apt on to a landing between stairs and the landing collapses. The
one guy falls hard on to the other guy and paralyzes him. The paralyzed victim sued the
friend for negligence for causing his injuries.
The question comes down to causation. The defendant owed the plaintiff a duty of
care. Did the defendant act unreasonably? Yes, but did that cause the plaintiff’s
The test for causation is, could this person foresee this injury? No because the
stairway gave away and the defendant couldn’t foresee this.
The plaintiff won some money against the city who inspected the building and the
owner of the building.
Hercules Managements Ltd. Et al. v. Ernst & Young et al.: The auditors of financial
statements messed up financial statements, which the company relied on for investments
etc. Hercules sued for negligence but the case was dismissed.
Reasonable foreseeability of harm? Yes
Are there any public policies that would argue against duty of care? Yes. Public
policy considerations mandate that there was no duty of care. If there was a
statement saying who was relying on the statements and why, there would be a
case but there wasn’t.
Poirer et al. v. Murphy et al.: Two guys are in an underground parking lot and devise
some tricks where one is hanging on the rafters and the other guy drives his car at him
and he swings out of the way. They decide to do it a second time, and instead of warning
the friend, the driver just goes and hits him. The friend sues for negligence, says he
caused his harm because you didn’t do the signal.
The defense is that the monkey guy was just as liable because they were being
They argue contributory negligence – he was himself negligent and contributed to
1/3 and 2/3’s (driver because he ignored the signal and therefore he is more
Volenti non fit injuria – to a willing person, is not done. Argued that the plaintiff
knew the real risk involved in carrying out the stunt and that, when he agreed to
do it, he impliedly exempted the defendant from liability.
Campbell v. Sooter Studios: The landlord sends over a draft lease which increases the
rent and sets out a 3 year term, the tenant makes some changes, a one year term instead of
3 years and changes the rent. The tenant sends it over to the landlord and the landlord
doesn’t read it and signs it.
There has to be a consensus
There has to be an offer and there has to be an acceptance of that offer and now
there is consensus
The standard that applies is that of a reasonable person. They had to read it. Not reading a contract is not an excuse
The legal principle is: would a reasonable person conclude there was a meeting of
the minds? Yes there was.
Mlodzinska v. Malicki: It’s common for one side to take a break at the court and go in to
a break out room. There was an offer of settlement outstanding. The lawyers and parties
outside the courtroom have made an offer to settle. It’s out there and available to be
accepted from the group in the courtroom. The group in the courtroom decided to accept
the offer, they write we accept the offer on a piece of paper intending to hand it to the
other side. But the other side writes “we revoke the offer” intending to hand it to the other
party. The party says in the courtroom that they revoke it, and then the other party hands
them the slip to accept it
It’s a matter of timing
A motion is a request for a procedural remedy; the result of a motion is an order.
The motion in this case is to have the case dismissed.
The judge has to issue a ruling; motion granted and case dismissed.
The other side that lost that motion has appealed. Here is the appealed decision
relating to that order.
It’s a horizontal move to a different trial court. The first appeal from an order goes
across to a different judge of the same level of court. This is why we have trial
court acting in an appellant capacity.
The second trial court says the original trial judge got it wrong and argues one
must happen first.
Because the order was overturned on appeal, that meant the case wasn’t dismissed
and it now goes back to the original trial court and the trial continues.
Kanitz v. Rogers Cable Inc.: A motion by Rogers to dismiss the case; they are the
defendant because there’s an arbitration clause in the contract so they can’t sue Rogers
because you agreed that you wouldn’t. Kanitz argues that there was nothing saying
anything about arbitration clause, but Rogers put it in after that and there’s another thing
in the contract saying they can change the contract whenever they want. The motion is
The first thing that comes out of this case is that the law was changed after this
case. The Ontario government amended the consumer protection act to put in a
clause that companies dealing with consumer’s cannot have arbitration and sue for
breach of contract. After this case, companies are allowed to just send little letters
saying the terms have changed etc.
During this case, the government overruled the law and reversed the reasoning of
The principle that comes from this case that hasn’t been overruled is the idea that
you can agree to a contract that one party can amend it unilaterally.
We agree that the company can change the contract whenever they want, as long
as they send you a letter informing you. “This represents an amendment to these
terms with RBC, if you use this credit card after this you are bound by these
terms.” Kohler Canada Co. v. Porter: Porter had signed a contract with his employer, Kohler, to
say he can’t work in other industries if he quit. Porter left a year later to work in another
factory in the same industry. Kohler’s motion was dismissed.
The ratio is there is no contract because there was no consideration because
Kohler didn’t receive any benefit AKA no consideration.
Contrary to public policy – fits under legality. The courts said that they wont
enforce contracts that are illegal; we will also not enforce contracts if they are
against public policy. Depriving this guy of a livelihood goes against public
policy. We’re not going to enforce a contract, which prevents a guy from earning a
This is obiter other than the ratio of there being no contract because no
They’re discouraging an appeal
Button v. Jones: A dentist sells (jones) his practice to another dentist (Button). They go in
to business together where the dentist that sold his practice goes to work for the guy he
sold it to. The seller signs a noncompetition contract in favor of the buyer.
The buyer sues him for breach, and the court agrees because there was
consideration because the seller got a benefit when he sold the practice and got a
lot of money.
This was a motion (requested relief of an injunction, which is equitable relief and
has to be done immediately) because it resulted in an order (the injunction) and
motion was granted.
This is not a competition issue where the guy is prevented from earning a living,
no public policy issue.
An interlocutory injunction was issued against Jones because the harm will be
greater due to the loss of Button’s patients for