Commercial Law Mid-Term:
-Essay question will come from an area that he has dealt with in class. Worth 13 marks. No
Choice. Not situational; typically general area that he has covered. Essay question in a separate
booklet. No point form!
-Short answer questions (20 marks) typically range anywhere between 0.5-3.5 marks each. Will
cover materials covered in class and it will cover materials from the chapters outlined. Point
Form is good!
-Give LOTS of detail. Answers don’t need to be in order.
-E-mail him he will provide practice exams for the Final (1/3 of it would have been from Mid-
-Worth 33% (33 marks total); 1 hour (flexible if more people need time)
Law and Canada’s Legal System:
-Law is a set of rules that has been put in place by either a governmental agency or judge where
there are consequences if you get caught violating this rule.
Systems of Law:
Common Law System of Law: all provinces deal with this type of law except Quebec
-3 meanings: common law system of law, common law vs. Equity, common law vs.
-Statute law is law that is created by a legislature (provincial or federal) or
referred to as an act or legislation (criminal code is a federal statute).
-Judges can make laws in common law (also called case law)
-Common law vs. Equity is when judges make laws they either pull from
common law (awarding damanges $) or equity (must pay damages in not $ but what was
promised (i.e. land) or go to jail until it is done). Injunctions (stoppages) are involved in equity.
-Utilized almost everywhere.
-Primary feature is the Principles of Stare Decisis (Theory of Precedent): which is the
idea of judges following the decisions of judges in the past.
-“To Stand by Previous decision”
-Past judge’s decision is generally a binding precedent for courts lower in the
judicial hierarchy. Past judge’s decision is only a binding precedent in courts in the same jurisdiction (province) or judicial system (Can vs. U.S.). Non-binding decisions can be
-3 Traditional reasons for the Theory of Precedent (Stare Decisis)-3 C’s:
1) Certainty: Can be relatively certain that that is what the law is
2) Consistency: Having law apply equally to people with the same
problem. Similar fact situations should be treated similarly to try to be fair.
3) Continuity: Won’t change frequently. Law made by way of precedent.
-Not everything a judge says in deciding a case is binding on judges in later cases.
-Ratio Decidendi: is binding; Ratio refers to the part of the judge’s decision that explains
why the judge decided they way they did
-Obiter Dicta: is not binding; Obiter refers to everything other than the ratio. Extra
commentary (but can be used for persuasive purposes).
Basic Court System (3-levels):
-Trial Court: 1 Judge; sometimes juries; each party brings evidence; two main findings: findings
of fact (real facts on what the real story is) and findings of law (laws that govern fact...existing
law that applies to leading to a result)
-Court of Appeal: usually multiple judges (never even always odd); usually no witnesses,
reluctant to change the findings of fact (only rely on transcripts for those); minimum # of judges
to hear an appeal is called the quorum (3 in MB).
-Final Court of Appeal (Supreme Court of Canada): multiple judges hearing the appeal; last
Civil Law System of Law: Quebec uses and other portions of the world (France, Italy, etc.)
-2 meanings: Private Law (ex. is it a civil law case or a non criminal one?) & Civil law
system of law
-Older of two major systems in the world. Theory is judge never makes law but rather
finds the facts and applies the laws to them. If the judge finds a situation that doesn’t fit any
laws they must find the closest fitting law. Judge evaluates what actually happened, then refers
to the civil law system (like a set of statutes). -Civil code is the listing of laws (or book) naming all the laws.
-Applies in Quebec with regard to private laws.
Substantive vs. Procedural Law:
-Substantive Law (2 types): deals with the rights and duties that people have in society
(where they live) that are expected to be upheld (ex. Contract law).
-Public Law: Law that is concerned with the relations/conduct of government and
the relations between government and other parties or persons (ex. Criminal law (federal law);
constitutional law-fundamental laws of nation or state; administrative law).
-Private Law: the rules that govern relations between persons and groups of
people (ex. contract law). This is where one person would sue another. Wills and estates fall
-Procedural Law: the law that deals with protection and enforcement of your substantive
Sources of the Law:
-Courts: make case or common law
-You go to a court to decode or change a statute.
-Legislatures: make statute law (primary legislation). A valid statute overrides all judge made
laws. Courts determine the validity of the statute.
-A Statute can make a brand new law; it can knock out a judge made law (repeal case
law), it can modify the judge made law; it can codify a judge made law by putting case law into
easily accessible documents (ex. Partnerships Act).
-The more statutes there are the more trials there will be.
A constitution is the fundamental law of a nation or a state. Our constitution is called the
Constitution Act of 1867 (most important sections are 91 and 92).
-Section 91 sets out the areas where federal parliament has the power to make laws
(sovereign). Has the power to make criminal law (ex. Criminal Code of Canada is federal
statute). Other examples: broadcasting, primary taxation power (income tax), military,
-Section 92 sets out the areas where provincial legislatures have the power to make law.
Residual (left over) power to make laws are the responsibility of the federal government (those substantive laws left out of the Constitution). Anytime a section of law (statute) is made, the
area becomes primary. Examples: education, healthcare, things purely local in nature.
-Administrative Legislation and Entities: make subordinate legislation: legislation inacted or
passed by a person, body, or tribunal that is subordinate to a sovereign legislative body. (ex.
Public Utilities Board and Workers Compensation Board or city council).
-By-Laws are subordinate legislation created by city council. Can only make law in the
scope of their powers given by the statute that created the entity.
-Allowed to have some power because delegation of tasks and specialization.
-Our Constitution does not recognize municipal rather “City of Winnipeg Council”.
-Territories are federal institutions.
-Ultra Vires: when a legislature acts beyond the scope of their power. Intra Vires is
within the scope of their powers.
Roles of the Courts:
-Arbiter of the Constitution:
-Arbiter is the encompassing term used to define a person who is used to settle a dispute
(judge, arbitrator, and mediator)
-For Example, what happens when the province makes an act that is called the
Educational TV Act. Education is their jurisdiction but broadcasting is federal, the judge need s
to determine if the act is valid or not.
-They’re supposed to make a determination of what is “pith and substance” mostly
about (based on), what are they trying to govern?. Look at this when wanting to change a
-Reference: When federal and provincial legislatures have issues, they bring them before
the Supreme Court to decided whose power is it to make that type of law?
-Until 1982, the only way you could attack validity of a statute was to challenge if
the right group made the law.
-Interpreter of Legislation:
-Hansard: discussions that take place in parliament (recorded)
-Previous versions of the legislation can be used.
-Can use dictionaries to interpret words and phrases. -Two forms of interpretation:
-Literal: literal meaning of the words used here, usually used by courts
-Liberal: rarely used when interpreting wordings in a statute. Usually used for
-Common for a judge to choose the meaning that has the smaller impact on the law.
-Unless the Golden Rule is in effect which means if the small change compared to
the bigger change makes for an absurd change then they will choose the bigger change.
-Protector of Civil Liberties (Rights):
-1982 made the Charter of Rights and Freedoms: changed the landscape of the power of
courts when it comes to government. Before this time the only way to change a statute was for it
to be admitted as a mistake when the legislature made it. Now we can argue statutes if they
violate our rights and freedoms.
-5 main points about the Charter:
-Freedom of religion, thought/expression, association/assembly, from discrimination, and
right to a fair trial.
-Charter of rights is said to be entrenched. When something is entrenched it
means it cannot be changed by a simple majority vote. Not easy to change! In order to change it
you need to have this amending formula: a resolution (majority) in favour of the change from
the House of Commons and a resolution (majority) from the Senate and you need a resolution in
favour of the change from at least 2/3 of Canada’s provincial legislatures (7) where the
legislatures represent at least 50% of Canada’s population. Plus Governor General approval.
-The General Rule: the rights given to us in the Charter cannot be violated by
ordinary legislation (statutes).
-Section 33 of the Charter of rights says that any legislature (provincial or federal)
can expressly override the rights set out in sections 2 and 7-15 (Pg. 13 of the textbook) in the
Charter of Rights and Freedoms (exception to the Golden Rule).
-Can insert a notwithstanding clause; a clause that comes to an end is
called a sunset clause if not voted on again every 5 years it will expire.
-Section 1 uses states the rights set out in the Charter are subject to reasonable
limits prescribed by laws as may be demonstrably justified in a free and democratic society.
Rights are not absolute and sometimes small violations are allowed for the greater good. -Charter does not apply to private transactions Charter of rights protects people
from government and the statutes they create.
-Arbiter of disputes between private parties:
System of Courts:
-In England-Unitary System: one sovereign level of government (control to make law)
-In Canada-Federal System: at least two sovereign legislatures that are separate (independent)
but interdependent because they need to work together. In Canada, this is Provincial and
Federal. There are three parts of the Constitution Act of 1867 that you must know:
-Section 101: gives the power to parliament to create and maintain a general court of
appeal for Canada (ex. Supreme Court of Canada). Federal parliament can also create any
additional courts for the better administration of the laws of Canada. Gave the power to federal
parliament to create its entire court system. Created the General Court of Appeal (Supreme
Court of Canada), and 3 others. They not only create these courts but they also select the judges
(Cabinet does this).
-Section 92 (14): Provincial legislatures have the power to create, maintain, and organize
courts of civil and criminal law. System of court outlined in more detail later.
-Section 96: Gives federal cabinet (Prime Minister and his Ministers) the ability to
appoint the judges in the highest trial court and the court of appeal for each province. Ex. MB
court of appeal and Court of Queen’s Bench are picked and paid federally.
Parties in Legal Action:
-Plaintiff in a civil case is the one doing the suing and in a criminal case it is the Crown
-Person being sued is the defendant in a civil case and in a criminal case it is the Accused
-In a civil case the finding is usually that the person is liable or not liable and in a criminal case
they are guilty or not guilty. (guilty and not guilty are never used in a civil case).
Standards of Proof:
The Standard of Proof is talking about how convincing the evidence has to be for the person who
brought the matter to court to win.
-Criminal-beyond a reasonable doubt: when the judge is making their decision the Crown must
have removed every single doubt that the person is innocent that a reasonable person would feel
for the person to be found guilty. (not guilty doesn’t mean innocent). -Civil-on a balance of probabilities: the plaintiff’s evidence must be more convincing (on a
balance) than the defendants evidence.
Res Judicata: literally translated into “matter adjudicated (fully judged)”. Required in every
court system (either criminal or civil action) that there is a point when something is over and
can’t be taken back to court. Can be Res Judicata in a number of ways. Most common when the
defined period of time to appeal a decision is past. Supreme Court of Canada can also decide
-In civil disputes, the parties generally initiate/start and prosecute litigation (to investigate facts,
present proof, & make legal argument to the Judge). The party who is taking it to Court needs to
push it forward to court, the system doesn’t do it for you.
-Analogy can be made to boxing – parties are the boxers and the judge is the referee by enforcing
procedure & deciding who wins.
-Two main principles of this system:
-Party presentation – parties present the facts/proof to the judge
-Party prosecution – the parties move the case forward (through the stages involved)
-Theoretically the judge is a passive arbiter.
The System of Courts in Canada Provincial System (Manitoba):
-In a superior court the judge deals with any matter unless a statute says it can’t. In an inferior
court the judge can only deal with matters that are set out in a statute.
-Provincial Court of Manitoba (Trial court-inferior court): if you appeal it will go to the
Manitoba Court of Appeal (if criminal) most often and sometimes the Court of Queen’s Bench
(if family). Only deals with stuff set out in the Provincial Court Act. Almost exclusively deals
with criminal law related matters. One aspect where this is not the case is in family division
cases as explained below.
-Two divisions of this court:
-criminal division: hears most trials just not murder or treason
-family division: deals with minors committing criminal offences and some
family law matters (ex. child custody and support, spousal support)-available for
those outside of Winnipeg and Selkirk). Can never deal with property division,
divorce, and adoption. -Never any jury trials in this level of court.
- Appointed by provincial cabinet.
-Court of Queen’s Bench of Manitoba (Trial court-superior court): if you appeal it will go to the
Manitoba Court of Appeal.
-Rules for Appeals: Set period of time to commence appeal to Manitoba Court of Appeal
(as of right) for civil matters. For criminal matters they can appeal to the Manitoba Court of
Appeal as of right if the appeal involves only a finding of law. If it is based on a finding of fact
or both fact and law you have to ask for permission leave to appeal.
-Almost never a jury in civil matters in Manitoba.
-Selected by Federal Cabinet.
-Mainly a trial court but to some degree it also hears appeals (from small claims court).
-Main division is the Family division: deals with any kind of family matter.
-If you sue someone you go to this court unless its small (small claims court). Also deals
with wills and estate law.
-Small Claims Court (Trial court-inferior court): if you appeal it goes to the Court of Queen’s
-Can only sue for up to $10,000 maximum. Judges don’t have to be lawyers.
-Very simplified rules to make it easy to do without a lawyer.
-An appeal as of right means you have the right to make the appeal. If you appeal
to the Court of Queen’s Bench you can do it de novo (fresh start). If you miss your court date
you have the right to leave to appeal (ask judge’s permission to appeal).
-The Court of Appeal: if you appeal it goes to the Supreme Court of Canada.
-All of the judges are selected by federal cabinet (Section 96). 8 judges for this level of
- For an appeal to be heard there is a quorum (minimum number that is required to do
business) which requires 3 judges minimum to hear an appeal. Chief Justice decides if there are
3, 5, or 7 judges.
-One time the trial starts here is when there is a reference (provincial government
challenging a statute). -Generally, only hear issues of findings of law. Only will hear findings of fact if leave to
appeal is granted.
-They can dismiss the appeal, allow the appeal (reversing the trial judgement), vary the
trial judgement, or they can order a new trial.
-If you lose your appeal: all civil appeals require leave to appeal from the SCC, the vast
majority are rejected. Only will grant it if it is a matter of public national importance.
Federal Court System of Courts:
Federal CourtFederal Court of AppealSupreme Court of Canada.
-In each of these courts created by f