Chapter1: Risk Management and Sources of Law
Risk management: process of identifying, evaluating, and responding to the possibility of
You need to identify, evaluate, and respond to the legal risks involved
Identify: Think about the liability, who is held responsible, possibility of being sued
Evaluation: What could happen from these situations
Response: options of what to do
Risk avoidance: Do not deal with situation at all
Risk reduction: Still be in the situation, but make it less risky. Ex. Give mortgage instead of loan
Risk shifting: shift to another person through
Differences between making an employee do something or an indep contractor.
Company isnt vicariously liable for an independent contractor
Company is vicariously liable for an employee
Risk acceptance: Accept it and deal with it
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: benefit if the purchaser is held liable for doing something
wrong. If not, its risk shifting
Property insurance: benefit if the purchasers property is damaged, lost, or
destroyed. If not, its risk shifting.
Exclusion and limitation clauses: contractual terms change the usual rules of liability of the
signer agreed to the contract
Incorporation: Some businesses are limited liability, meaning only the company can get sued.
But doesnt protect from all risks. You can be held personally liable for the torts A Map of the Law
Law: a rule that can be enforced by the courts
Civil vs. common law
Civil law: systems trace their history to ancient Rome. Only Quebec, only civil jurisdiction
Jurisdiction: geographical area that uses the same set of laws
Common law: systems trace their history back to England
Public law: concerned with governments and the ways in which they deal with the citizens
constitutional law, administrative law, criminal law, tax law
Constitutional Law: provides the basic rules of our political and legal systems
Determines who is entitled to create and enforce laws, and establishes the
fundamental rights and freedoms
Administrative law: concerned with the creation and operation of administrative agencies and
Example: Human rights tribunal decides that a company discriminates
against woman in Wages. Therefore, compensation
Criminal Law: deals with offences against the state
White collar criminal: committed by people in suits
Corporate crime: company does crime
Tax law: concerned with the rules that are use dot collect money for the purposes of public
spending Private Law
Private law: concerned with the rules that apply in private matters
Law of torts, contracts, and property
Tort: a private wrong, an offence against a particular person
Intentional torts, such as assault and false imprisonment
Business torts, such as deceit and conspiracy
Negligence: carelessly hurts another
Law of contracts: concerned with the creation and enforcement of agreements
a) Sale of goods, such as cows and computers
b) Negotiable instruments, such as cheques
c) Real estate transactions, such as the purpose of land
d) The operation of corporations
e) The employment relationships that exists between business and workers
Law of property: concerned with the acquisition, use, and disposition of property
a) Real property, land and things that are attached to land
b) Personal property, things that can be moved around
c) Intellectual property, original ideas, patents, copyright
Law of succession: deals with the distribution of a person`s property after death
Law of trusts: situation in which one person holds a property on behalf of
Sources of Law
1) CONSTITUTION: document that creates the basic rules for Canadian society, including its
political and legal systems
Every law has to be compatible with it. Can only be changed through the amending formula.
Charter is in the Constitution
2 levels of government: federal, and provincial&territorial
A) Federal: Parliament of Canada, in Ottawa, governs country as a whole.
-House of Commons: consists of members of Parliament (MPs), elected form each province.
-Senate: consist of senators, appointed to their jobs.
Queen runs state
Country is run by the political party with the most MPS. The leader of the party is the Prime
B) Provincial and Territorial:
Not only are MPs represent you, but you can elect politicians from your province. The person
you elect, or legislature, is called the Legislative Assembly. Each of the 13 legislatures is
similar to Parliament. Always face the 2 sets of laws
Divisions of power: states the areas in which each level of government can create laws
Residual power: gives the federal government authority over everything that is not
Ultra vires: beyond the power. When a governments tries to create a law. Its inadmissible
Sometimes problem when both levels of government conflict
Intra vires: act within your scope of power
Doctrine of federal paramountcy: how despite is decided. Determines which law is pre-
eminent based on the Constitution`s divisions of powers
Charter of Rights and Freedoms:
In the constitution. Page15.
Property rights: rights to enjoy property
Economics rights: rights to carry on economic activities
Businesses not included for the charter
`Unconstrained right to transact business whenever one wishes`
a) Government action: only for individuals and if they`re complaining about the government
The Charter dos not directly apply to disputes involving private parties
b) Corporations: The Charter generally does not apply against private corporations.
Corporation is a type of person, not an individual.
c) Reasonable limits: Section1 states that is rights and freedoms are subject to `such
reasonable limits prescribed by law as can be demonstrably justified in a free and
democratic society`. It is acceptable to sometimes be violated
d) Notwithstanding clause: Section 33 allows parliament or a legislature to create and
enforce a law `notwithstanding` the fact that it violates the Charter
What happens when Charter is violated?
a) Declaration: Court declares it`s been violated
b) Injunction: court addresses problem. Decision lies with the judge, not legislature
c) Striking down: Court may eliminate a statute that violates the Charter.
d) Severance, reading down, and reading in: Severedored by being edited. If statute written
too broadly, may be read down so it`s more specific. If too specific, read in so it`s more
e) Damages: plaintiff gets damages for suffering
Parliamentary Supremacy: means that while judges are required to interpret constitutional and
statutory documents, they must also obey them