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Final

LAW 525 Study Guide - Final Guide: Credit Bureau, Summary Offence, Health Canada


Department
Law and Business
Course Code
LAW 525
Professor
Kernaghan Webb
Study Guide
Final

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1
LAW 525 Class Notes
Chapter 1 - Introduction
Gov’t Intervenes with Legislation in MKTplace – when it regards with health & safety, to create a
sense of confidence with consumers purchasing goods/services, dealing with environmental policies,
decrease fraud, employment, etc.
Business-Consumer MKT Transaction Process:
1) Pre-Transaction Phase: Products are manufactured, sales practices, advertising campaigns & inter-
firm sales arrangements.
2) Actual Transaction Phase: Terms, conditions, warranties & guarantees are stipulated, consumer info
is collected & credit arrangements are made.
3) Post-Transaction Phase: Redress/remedies, consumer info used, consumer info exchanged with 3rd
parties & loan payments are collected.
LAW = Common Law (court made law: contract/tort law) + Statute Law (gov’t made law).
MKT Failures & Law – contract law (voluntary obligations b/w parties) & tort law (obligations
imposed by common law – courts).
- Society may conclude such framework is inadequate leading to legislation & regulations.
Gov’t is concerned with interfering in legislation due to fact that international companies will go to a
jurisdiction with lesser restrictions – bad for jobs & economy.
- Gov’t also needs to police issues, which involves money (comes from taxes).
- Legislation & regulations are created by gov’t to protect consumers from mkt failures (detract from
meaningful consumer choice).
MKT Failure:
1) Monopolistic Behaviour – dominant player(s) prevent competitors from mkt entry.
2) Negative Externalities – unknown costs are assumed by consumer (unknown hazards & risks).
3) Information Failures – info imbalance – businesses know their products (including hazards &
attributes) better than consumer.
Gov’t Response  LAWS:
- Minimum safety standards, mandatory disclosures, prohibition of certain sales practices, prohibit sale
of certain products to certain consumers (e.g. age, license), liability for defective or harmful
products/practices.

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Transaction Costs – gov’ts attempt to minimize “transaction costs” associated with protecting
themselves.
- Methods of Redress – cooling off periods (statutory period of time to cancel an obligation), small
claims court, arbitration, class proceedings & file a complaint with an ombudsman, they then do an
investigation & then recommend a non-binding solution.
Risk Management for Businesses: identify risks, evaluate risks & respond to risks.
- Risk Avoidance – withdraw dangerous product.
- Risk Reduction – modify product to reduce danger.
- Risk Shifting – insurance/exclusion clauses (shift risk to consumer – have them agree to withhold
legal consent) & Accept Risk – do nothing.
Chapter 2 – Constitutional Aspects
Hierarchy of sources of law: Constitution – 1867 (highest source), Legislation & Courts.
1) Basic rules for CDN Society including its legal & political systems – 1) Division of Powers, 2)
Charter of Rights & Freedoms & 3) Charter Remedies.
-Division of Powers: Federal Gov’t (jurisdiction for banking) & Provincial Gov’t (jurisdiction with
respect to property rights).
- S. 91 of Constitution Act sets out Federal Powers (pg. 2-1); s. 92 sets out Provincial Powers.
- Federal Gov’t holds residual powers – topics not allocated to provinces (e.g. telecommunication).
Ultra Vires – laws created outside a gov’ts authority are of no force or effect (s. 52).
Intra Vires – laws created within a gov’ts authority are of legal force & effect.
Challenge validity of law of whether it’s within jurisdiction of gov’t – if valid (intra vires), then
discussion falls upon infringement of Charter Rights & gov’t can use s. 1 as a defence.
- If law is ultra vires (beyond gov’ts constitutional jurisdiction), law violates Charter.
2) Charter’s intent was to protect basic rights & freedoms from gov’ts.
S. 1 of CDN Charter guarantees rights & freedoms set out in it subject only to such reasonable limits
prescribed by law as can be demonstrably justified in a free & democratic society – means gov’t can
infringe upon our rights.
S. 2 include fundamental freedoms for everyone on pg. 2-3.
S. 15 (1) include equality rights for every individual (excludes corporations) on pg. 2-4.
- SS. 2 allows gov’ts to help certain disadvantaged groups (reverse discrimination argument).

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S. 33 (1) – Parliament or legislature of a province may expressly declare that a law shall operate
notwithstanding a provision in s. 2 or s. 7-15 of Charter (pg. 2-5).
- Québec has limited freedom of expression by having all signs in French using s. 33 & it has to be
renewed every 5 years (ss. 3) – other countries are afraid of using this provision.
R. v. Cosman Furniture (1976 before Charter) – charged under Hazardous Products Act (Federal) –
prohibits sale of unsafe cribs & cradles (pg. 2-26).
- Cosman Furniture argued that HPA was invalid b/c it was outside jurisdiction of federal gov’t –
federal gov’t argued that it was within its “criminal law” jurisdiction – Cosman Furniture argued that
federal gov’t was infringing upon provincial “property & civil rights” jurisdiction – “criminal law”
jurisdiction includes laws having purpose of preventing harm to society & “property & civil rights”
jurisdiction includes real property, personal property, industry, advertising, contractual rights,
insurance, etc.
- Decision – although HPA does have incidental effect on “property & civil rights” essential purpose of
HPA is “criminal law” – public purpose of safeguarding health & security of infants – HPA is valid –
INTRA VIRES.
R. v. CDN Western Bank, etc. v. Alberta (pg. 2-30) – charged under Alberta Insurance Act – imposed
restrictions & obligations upon Banks – Banks argued that “banking” is a federal jurisdiction,
therefore, Alberta did not have power to impose obligations upon Banks – Alberta gov’t argued that it
was within province’s “property & civil rights” jurisdiction that includes “insurance” – decision:
Alberta Insurance Act & Federal Bank Act can co-exist – Alberta Insurance Act is within “property &
civil rights” – Federal Bank Act allows insurance to secure loans – this is ancillary to banking/not
core to banking – “Federal Paramountcy Doctrineused only in event provincial laws conflict with
federal laws.
Québec v. Irwin Toy Ltd. – charged under Québec Consumer Protection Act (QCPA) prohibits
commercial advertising (including TV) directed at persons < 13 years of age (pg. 2-33).
- Irwin Toy argued that QCPA was invalid b/c it was outside jurisdiction of provincial; “broadcasting”
is a federal jurisdiction – Québec gov’t argued that it was within its “property & civil rights
legislation – decision: although QCPA has incidental impact upon broadcasting, main purpose is to
protect children from exploitation, therefore, QCPA is valid (intra vires).
Labatt Brewing Co. v. Canada (pg. 2-21) – product contained 4% alcohol, but under Food & Drug
Regulations, a “light beer” should contain no more than 2.5% alcohol so Labatt appeals under
argument of whether this is a federal gov’t jurisdiction or provincial – decision established was that
this was not contained within federal jurisdiction & this falls under provincial jurisdiction.
3) Burden of Proof is on person challenging validity of law if law violates Charter.
- If law violates Charter, is law saved by s. 1 of Charter (burden of proof is on gov’t to prove).
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