Law 122 Chapter Notes Winter 2013
LAW122 Chapter Notes
Chapter 1 – Risk Management and Sources of Law
Risk Management - The process of identifying, evaluating and, responding to the possibility of
Risk Avoidance - Steering clear of potentially damaging situations altogether.
(i.e. Refusing to engage in an activity that carries risk/liability)
Risk Reduction - Instead of assuming entire risk, receiving collateral to ensure you cannot lose.
(i.e. Offering mortgage)
Risk Shifting - Making sure that you cannot be singled out as responsible for payment of
damages though avenues such as hiring independent contractors (vicarious
liability, having insurance (paying a fee to be covered financially in case of an
incident), having exclusion/limitation clauses (Parking lot signs that state the
owners of the lot assume no responsibility for damages to vehicles), or
operating as an Incorporation (providing limited liability status to shareholders,
CEOs and board members)
Risk Acceptance - Accepting that damage or loss might occur, and that other avenues to prevent
this would not be feasible.
(i.e. – Being aware of issues and risks and dealing with them as they arise)
Law - A rule that can be enforced by the courts.
Civil Law - Trace their history to ancient Rome. The only civil law jurisdiction in Canada
today exists in Quebec.
Common Law - Trace their history to England - exists in rest of Canada, Australia, New Zealand
and most of US.
Jurisdiction - A geographical area that uses the same set of laws.
Public Law - Concerned with Governments and how they deal with their citizens
• Constitutional Law – Basic rules of our political/legal systems; who is
entitled to create and enforce laws. Establishes fundamental rights and
• Administrative Law – Concerned with creation and operation of
administrative agencies and tribunals. “Corporate/Business law”
• Criminal Law – Deals with offences against the state (people who
• Tax Law – Concerned with the rules that are used to collect money
for public spending.
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Private Law - Concerned with the rules that apply in private matters. Usually a dispute
between two private persons, however it is possible for a private individual to
sue a public body (suing the city for failing to ensure building codes were met).
Private law is usually divided into three main parts (Tort, Contract & Property).
The Law of Torts - A private wrong, or offence against a particular person. Can be further divided
into three forms of Torts.
• Intentional torts (Assault, false imprisonment)
• Business torts (Deceit, conspiracy)
• Negligence (Careless damage/Injury to another)
The Law of Contracts - Concerned with the creation and enforcement of agreements – especially
important in business.
The Law of Property - Concerned with the acquisition, use and disposal of property which can be
divided into three main forms.
• Real Property, which involves land and things attached to land
• Personal Property, which involves things that can be moved from one
place to another (vehicles, computers, furniture)
• Intellectual Property, which involves things that consist of original
ideas (patents, trademarks, copyrights)
Three Sources of Law - Constitution, Legislation and courts.
Constitution - A document that creates the basic rules for Canadian Society, including our
political and legal systems. Every other law in the country must be compatible
with it. It cannot be changed, except through amendments.
Division of Power - Canada is a Federal country because it has two levels of government, each
having their own areas of rule where laws can be created and enforced.
• Federal – The Parliament of Canada, which governs the country as a
whole, consisting of Members of Parliament elected from each province
and territory. Composed of political parties, the majority of which run
the country, and the leader of that party is the Prime Minister
• Provincial/Territorial – Thirteen elected bodies of Legislature, similar
to Parliament, with the leader of the majority of parties being the
Premier of the province/territory.
Residual Power - Gives the federal government authority over everything that is not specifically
mentioned in the constitution, including things that did not exist when it was
written. (i.e. – Telecommunications, Air Travel, Internet laws)
Ultra Vires - When a government tries to make laws outside its area. (“Beyond the Power”)
(i.e. – Banning the production of Margarine.)
Intra Vires - When a government acts within its scope of power. (“Within the Power”)
(i.e. – Banning the importation of Margarine.)
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Three main sections of the Charter;
Fundamental - Everyone has the following freedoms
Freedoms • Freedom of conscience and religion
(Section 2) • Freedom of thought, belief, opinion and expression, incl. freedom of
the press and other media of communication
• Freedom of peaceful assembly
• Freedom of association
2- Mobility Rights - Every citizen of Canada has the right to remain in and leave Canada.
(Section 6) - Every citizen of Canada and every person who has the status of
Permanent Resident of Canada has the right…
• to move to and take up residence in any province; and
• to pursue the gaining of livelihood in any province
Equality Rights - Every individual is equal before and under the law and has the tight to the
(Section 15) equal protection and equal benefit of the law without discrimination and, in
particular, without discrimination based on race, national or ethnic origin,
colour, religion, sex, age or mental or physical disability.
- Subsection (1) does not preclude any law, program or activity that as its object
the amelioration of conditions of disadvantaged individuals or groups including
those that are disadvantaged because of race, national or ethnic origin, colour,
religion, sex, age or mental or physical disability.
Property Rights - The rights to enjoy property.
Economic Rights - The rights to carry on economic activities.
Chapter 3 - Introduction to Tort Law
Tort - Generally consists of a failure to fulfill an obligation that was imposed by law.
Tortfeasor - A person who has committed a tort.
Tort vs. Crime - Torts are against private obligations, Crimes are against public obligations.
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Tort vs. Contract Similarity:
- Both involve primary obligations (what you ought to do, and
secondary obligations (remedial actions for breaking primary
- Source of Primary: Tort Imposed by law
Obligations Contract Created by parties
- Privity: Tort Anyone can be sued, because torts are
imposed by law
Contract Only the parties in the contract can
be sued, because they agree to the terms.
- Compensation: Tort Must return Plaintiff to position
previously enjoyed at outset of the tort.
Contract Expected to put Plaintiff in
position expected at contract end.
- Risk Management: Tort Imposition by law ∴ more likely to take a
person by surprise, and may require more than
a person can give/provide to fulfill duties.
Contract Obligations are created voluntarily
∴ should never take a party by surprise, and
never require more than the parties believe
they can provide.
Types of Torts - Intentional Torts: Occur when a person intentionally acts in certain ways. Some
torts require proof that the defendant intended to do harm, other are satisfied
by proof that the defendant chose to act in a certain manner even if they didn’t
realize the plaintiff would be hurt.
- Negligence Torts: Occur when an individual acts carelessly.
- Strict Liability Torts: Occur when a person does something wrong without
intending to do so and without acting carelessly. It is enough that the defendant
was responsible for the situation that resulted in the plaintiff’s injury. (Very
specific and rare form of tort law)
General Principles - Three main concepts
of Tort Law • Liability Insurance
• Vicarious Liability
Liability Insurance - A contract in which an insurance company agrees, in exchange for a price, to
pay damages on behalf of a person who incurs liability. This also includes a duty
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Duty to Defend - A requirement of an insurance company to pay the expenses that are
associated with lawsuits brought against the insured party.
Compensationary - Aims to fully compensate people who are wrongfully injured.
Deterrence Function - Discourages people from committing torts by threatening to hold them liable
for the losses they cause.
Vicarious Liability - Occurs when an employer is held liable for a tort that was committed by an
Independent - A worker who is not as closely connected to the employer’s business as an
Contractor employee, and therefore cannot cause vicarious liability to an employer.
Remedies - There are four main types of remedies available in tort.
• Compensatory Damages • Punitive Damages
• Nominal Damages • Injunctions
Compensatory - Standard remedy for tort or contract. In tort, it is used to return the plaintiff to
Damages the position prior to the tort. In contract, it is used to put the plaintiff into the
position intended at what would have been the end of the contract.
Remoteness - Defendants are only responsible for the losses that it in fact caused. If the
connection between the tort and the loss is too remote, the court will not award
damages for them.
Mitigation - Occurs when the plaintiff takes steps to minimize the losses that result from
the defendant’s tort. Compensation will not take place if the plaintiff does not
make a reasonable attempt to mitigate their losses. (i.e. if someone fails to take
reasonable precautions before engaging in an activity, [wearing recommended
safety gear, getting vaccinated).
Punitive Damages - Damages with the sole reason of providing punishment for a tort, usually
applied in supplement of another form of compensation. Defendant must have
acted in a “harsh, vindictive, reprehensible and malicious” manner.
Nominal Damages - Compensation rewarded to the plaintiff, even if they did not suffer any loss, as
a symbolic recognition that the defendant committed a tort. They are usually
awarded in very small amounts, even as low as $10.
Injunctions - A court order requiring a defendant to refrain from doing something.
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Chapter 4 – Intentional Torts
Intentional Tort - Involve intentional as opposed to careless conduct.
Assault - Occurs when a defendant intentionally causes a plaintiff to reasonably believe
that offensive bodily contact is imminent.
• Is not based on offensive physical contact – based on the simple
reasonable belief that such contact will occur imminently.
Battery - A tort consisting of offensive bodily contact.
• Does not require physical contact – can come in the form of a weapon,
or if the defendant makes contact with the plaintiff’s clothing, or
something the plaintiff is holding.
• Cannot be in the form of normal social interaction – such as bumping
into someone in the subway, or a crowded street. However it can be
considered battery even if the contact is highly beneficial to the plaintiff
(i.e. CPR, pushing someone out of the way of a car that would hit them.)
Invasion of Privacy - Privacy is a tricky area of law, as personal rights of some and the freedom of
expression and freedom of information right of others is always in conflict.
Furthermore, damages of invasion of privacy are often hard to calculate
compensation for (i.e. embarrassment, humiliation) Privacy is instead protected
indirectly by several torts. (Trespassing, breach of confidence, etc.)
False Imprisonment - Occurs when a person is forced to be confined in a fixed area without
justification. A physical prison is not required, can be committed by locking
someone in a car, or set adrift on a boat. Does not even have to be a physically
forced detention, can be a psychologically forced act, such as intimidating
someone and telling them to stay in an area.
Malicious Prosecution - Occurs when the plaintiff improperly causes the defendant to be prosecuted.
Focus on fact that the defendant has to face criminal proceedings, rather than
Trespass to Land - Occurs when the defendant improperly interferes with the plaintiff’s land.
Interference with Chattels
Chattels - Movable forms of property. (Furniture, Vehicles, Books.) Three most important
torts in relation to chattels:
• Trespass to Chattels • Conversion •Detinue
Trespass to Chattels - Occurs when the defendant interferes with chattels which are in the plaintiff’s
possession – such as causing damage to an expensive painting, or damaging a
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Conversion - Occurs when the defendant interferes with the plaintiff’s chattels in a way that
is serious enough to justify a forced sale. Conversion can be applied in examples
such as the defendant caused so much damage to an item that they were
required to pay the plaintiff market value for the item in exchange, or if the
plaintiff’s item was vandalised or stolen. Conversion can be applied even if the
defendant is a seemingly innocent party – for example if they are caught with
property they purchased from an individual that stole it.
Detinue - Occurs when a defendant fails to return a chattel that the plaintiff is entitled to
Recaption - The right of a person to take back possession of their property.
Complete Defence - Complete defences protect the tortfeasor from all liability, there are four
• Consent • Legal Authority •Self-Defence •Necessity
Consent - Consent is a reasonable defence to all intentional torts and can be express or
implied. It exists if a person voluntarily agrees to experience an interference
with their body, land or goods. If the plaintiff knowingly agreed to the possibility
of restriction of freedom unless their requirements were fulfilled, the defendant
cannot be found guilty. (i.e. Not being allowed to remove your car from a repair
shop without paying for services, or being left at a job site until a shift ends.)
Legal Authority - Provides a person with a lawful right to act in a certain way, and therefore
cannot lead to liability in tort.
Self-Defence - Consists of the right to protect oneself from violence and the threat of
violence. There is a fine line between respecting the natural reaction to fight
back and the danger of giving people an excuse to cause harm.
Necessity - This applies if the defendant’s actions were justified by an emergency
situation, and immediate decisions to act had to be made.
Partial Defences - Allows a court to reduce damages on the basis of the plaintiff’s own
responsibility for a loss or an injury. There are two main defenses:
• Provocation •Contributory Negligence
Provocation - Consists of words or actions that would cause a reasonable person to lose self-
control. This entitles plaintiff to damages for a physical attack, but not for full
Contributory - Occurs when the plaintiff is partially responsible for the injury that the
Negligence defendant caused. Damages are awarded but reduced to reflect the plaintiff’s
contribution to the injury.
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Chapter 5 – Miscellaneous Torts affecting Business
Conspiracy - Usually occurs when two or more defendants agree to act together with the
primary purpose of causing the plaintiff to suffer a financial loss.
Intimidation - The tort of intimidation occurs when the plaintiff suffers a loss as a result of
the defendant’s threat to commit an unlawful act against the plaintiff or a third
party. In order for a tort of intimidation to be valid, the plaintiff must:
i) Prove the defendant threatened to commit an unlawful act
(crime/tort/breach of contract/etc.)
ii) Threatened party has to have given into the intimidation.
iii) As long as the other elements of the tort are established, there is no
need to prove that the defendant intended to hurt the plaintiff. For
instance, intimidation may occur even if the tortfeasor was motivated
by a desire to benefit itself, rather than injure the plaintiff.
The two forms of intimidation are:
• Two-Party Intimidation – Where the defendant directly coerces the plaintiff
into suffering a loss (i.e. “I’ll beat you up if you don’t close your business”)
• Three-Party Intimidation – occurs when the defendant coerces a third party
into acting in a way that would hurt the plaintiff (i.e. Union threatening a strike
unless you fires the plaintiff.
Direct Inducement - Occurs when the defendant directly persuades a third party to break its
to Breach of Contract contract the plaintiff. Liability requires four factors.
1 ) Defendant must know about the contract that exists between the third party
and plaintiff, but does not need to know details.
2 ) Defendant must intend to case the third party to break that contract, but
intention to hurt plaintiff not required.
3 ) The Defendant must actually cause the third party to break its contract with
the plaintiff – for example, making arrangements with the third party that
would make it impossible for the third party to fulfill obligations to plaintiff.
Indirect Inducement - Occurs when the defendant indirectly persuades a third party to break its
to Breach of Contract contract with the plaintiff. It requires same proof as Direct Inducement, plus
proof that the defendant’s actions themselves were unlawful.
Unlawful Interference - Occurs if the defendant commits an unlawful act for the purpose of causing
With Economic the plaintiff to suffer an economic loss.
Deceit - Occurs if the defendant makes a false statement, which it knows to be untrue,
with which it intendeds to mislead the plaintiff, and which causes the plaintiff to
suffer a loss.
Includes: • Telling Half-Truths •Failing to Update Information
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Occupiers’ Liability - Requires the occupier of a premises to protect visitors from harm.
Nuisance - Occurs when the defendant unreasonably interferes with the plaintiff’s use
and enjoyment of its own land - can involve physical or non-physical
Statutory Authority - Means that the defendant caused a nuisance while acting under legislation,
and the nuisance was an inevitable result.
Defamation - Occurs when the defendant makes a false statement that could lead a
reasonable person to have a lower opinion of the plaintiff. The tort of
defamation can be applied even if the defendant did not intend to refer the
plaintiff negatively, can be made by any sort of living person/persons (including
things such as corporations), and the defaming statement must be proven to be
referring to each defamed person personally.
Slander vs. Libel - Slander is spoken defamation while Libel is written defamation.
Publication - Defamation cannot exist without publication, which is the communication of a
defaming statement to a third party. A new tort can be accounted for each time
that a statement is repeated.
Justification - Occurs only when the statement is true.
Privilege - An immunity from liability. Come in the forms of:
1) Absolute privilege – Complete Immunity, which is
used when the law needs individuals to communicate
without fear of being sued.
2) Qualified privilege – Applies whenever the defendant
has a legal, moral, or social obligation to make a
statement and the statement is being made to someone
who had similar duty or interest in receiving it.
Public Interest - Occurs when a journalist, despite getting some facts wrong, acted in
Journalism accordance with the standards of responsible journalism in publishing a story
that the public was entitled to hear.
Fair Comment - An expression of an opinion regarding a matter of public importance, which
must be intended to protect informed opinions, and be concerning an issue of
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Injuries Falsehood - Occurs when the defendant make a false statement about the plaintiff’s
business that causes the plaintiff to suffer a loss. The statement must prove to
be false, an act of malice and caused a loss. This tort can take a variety of forms
• Slander of Title – Claiming the plaintiff does not actually own an
object it is trying to sell.
• Slander of Quality - The defendant disparages the quality of the
plaintiff’s products, causing potential customers
to take business elsewhere.
Chapter 6: Negligence
Tort of Negligence - Determines whether the defendant can be held liable for carelessly causing
injury to the plaintiff.
Duty of Care - Exists if the defendant is required to use reasonable care to avoid injuring the
plaintiff. There are a number of tests for determining the existence of duty of
• Reasonable Foreseeability – This test is objective, in that the issue is
not to see if the plaintiff personally knew, that its activities would injure
the plaintiff, it is whether a reasonable person would have known.
• Proximity – There must somehow be a close and direct connection
between the two parties, such as physical proximity, or a
Policy - Whether or not liability should be denied on grounds that the plaintiff’s
position or title implied a duty of care – very tricky grounds for courts as it a
very grey area.
Standard of Care - Tells the defendant how it should act. When this is not met, and the defendant
has acted carelessly, it has breached its duties.
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Chapter 7: The Nature and Creation of Contracts
Consensus ad idem - A share mutual agreement to enter into an enforceable transaction on a
(Meeting of the minds) particular basis.
Steps required in order to create a contract:
1) Both parties must have an intention to create legal relations.
- Arises if a reasonable person would believe that the parties
intended to create a legally enforceable agreement. This test is
more objective than subjective – a judge would look at what a
reasonable person would have thought – not the thoughts of
the actual party. Also looks at reasonable expectations – i.e. I
gave you money, and expect to receive my product, even if
secretly, you intended to keep my money and the
2) They must reach a mutual agreement through the process of offer and
- Offer must be made (by “Offeror” to the “Offeree”) which an
indication of a willingness to enter into a contract on certain
3) They must enter into a bargain by each giving consideration.
Invitation to treat - Not classified as an “offer” rather an indication of a willingness to receive an
offer. Individual who presents an offer is still offeror, and individual who
presented the invitation is offeree.
Communication - A statement is not an offer unless it is communicated and received as an offer.
of an Offer
Life of an Offer - Offers are valid until accepted or denied, or until they are revoked, a
designated time period has passed, one of the parties passes away or loses
mental capacity, or a counter offer is made.