1. Copyright © 2013 Pearson Canada Inc. Chapter 1 The Canadian Legal System Legal Fundamentals for Canadian Business Third Edition 1 - 1

2. Copyright © 2013 Pearson Canada Inc. Define what law is Identify the sources of Canadian laws and distinguish their components Describe the structure of the courts in Canada and illustrate the litigation process Outline the processes of trial and judgement (Continued) Learning Objectives 1 - 2

3. Copyright © 2013 Pearson Canada Inc. Explain the function and use of alternative methods for resolving disputes Define administrative law and explain when and how it is used Describe the aspects of criminal law that should be of concern to a business person Learning Objectives (Continued) 1 - 3

4. Copyright © 2013 Pearson Canada Inc. Law is the body of rules that can be enforced by the courts or by other government agencies Law does not define ethical behaviour Definition of Law 1 - 4

5. Copyright © 2013 Pearson Canada Inc. Categories of Law Substantive law –Rules determining behaviour Procedural law –How the legal process works (Continued) Categories of Law 1 - 5

6. Copyright © 2013 Pearson Canada Inc. Public law –Regulates our relationship with government Private or Civil law –Regulates personal, social, and business relationships Categories of Law (Continued) 1 - 6

7. Copyright © 2013 Pearson Canada Inc. Codified body of rules Originated with the Romans; later modified by Napoleon Used in most countries Quebec’s legal system is based on the French Civil Code Civil Code Legal System 1 - 7

8. Copyright © 2013 Pearson Canada Inc. Common Law Legal System Common law used in Great Britain and the Commonwealth System adopted by Canada’s English- speaking provinces and the territories Judge-made law – Developed in the courts – Based on precedent or stare decisis 1 - 8

9. Copyright © 2013 Pearson Canada Inc. Common law –Following precedent or stare decisis Bound to follow precedent case if: –Decision made by higher court –In the same jurisdiction –Based on similar facts –May distinguish cases on the facts (Continued) Common Law - Sources of Law 1 - 9

10. Copyright © 2013 Pearson Canada Inc. Law of equity – Decisions made by Courts of Chancery – Based originally on fairness – Developed to counter rigid common law – Courts later merged, but bodies of law remained separate (Continued) Common Law - Sources of Law (Continued) 1 - 10

11. Copyright © 2013 Pearson Canada Inc. Statutes – Laws created by legislative bodies –“Parliamentary supremacy” (i.e., legislation overrides common law and law of equity) –Often summarize or modify common law –Include government regulations (Continued) Common Law - Sources of Law (Continued) 1 - 11

12. Copyright © 2013 Pearson Canada Inc. Common Law - Sources of Law (Continued) 1 - 12

13. Copyright © 2013 Pearson Canada Inc. Canada created by British North America Act, 1867 Canada inherited certain conventions or traditions from Britain –Rule of law –Principles established in the Magna Carta –Parliamentary supremacy (Continued) The Law in Canada 1 - 13

14. Copyright © 2013 Pearson Canada Inc. BNA Act now called Constitution Act (1867) –Sections 91 and 92 divide powers between federal and provincial governments –Principle of paramountcy applies in cases of conflict between federal and provincial laws The Law in Canada (Continued) 1 - 14

15. Copyright © 2013 Pearson Canada Inc. Constitution Act (1982) Ended ties with British Government Listed government enactments having constitutional status Established amending formula for constitutional change Included Charter of Rights and Freedoms Constitution Act (1982) 1 - 15

16. Copyright © 2013 Pearson Canada Inc. Protects individuals from infringement on their rights by governments or their agents Includes limitations on Charter rights: – Section 1 – reasonable exceptions to Charter rights and freedoms allowed – Section 33 – legislatures can pass acts that infringe on rights “notwithstanding” the Charter – Section 32 – Charter applies only to government Charter of Rights and Freedoms 1 - 16

17. Copyright © 2013 Pearson Canada Inc. The Courts: Court Structure 1 - 17

18. Copyright © 2013 Pearson Canada Inc. Process of Civil Litigation Civil trial - action for compensation Pleadings - See chart Discovery Examination of documents Examination of witnesses Payment into court Innovations Class action lawsuits Plaintiff Defendant Writ of Summons Appearance Statement of Claim Statement of Defence Counterclaim 1 - 18

19. Copyright © 2013 Pearson Canada Inc. Plaintiff presents case –Burden of proof rests with plaintiff –Balance of probabilities –Direct examination of witnesses –Cross-examination by defense lawyer (Continued) Trial 1 - 19

20. Copyright © 2013 Pearson Canada Inc. Trial (2) Defendant presents case –Brings forward witnesses and evidence –Plaintiff’s lawyer gets to cross-examine –Tries to put enough doubt into the plaintiff’s case so plaintiff cannot prove his/her case (Continued) Trial (Continued) 1 - 20

21. Copyright © 2013 Pearson Canada Inc. Trial (3) Judge determines the law and instructs the jury Jury decides on the facts If judge alone, he/she determines both facts and law Trial (Continued) 1 - 21

22. Copyright © 2013 Pearson Canada Inc. Damages (monetary compensation) General – non-quantifiable losses Special – quantifiable losses Punitive – to punish the wrongdoer (Continued) Remedies 1 - 22

23. Copyright © 2013 Pearson Canada Inc. Remedies (2) Equitable remedies where damages are not appropriate –Injunction – stop order –Specific performance – fulfill the terms of an agreement –Accounting – pay over profits Remedies (Continued) 1 - 23

24. Copyright © 2013 Pearson Canada Inc. Plaintiff must enforce judgment Post-trial hearing to identify assets Seizure of property Garnishment of wages Contempt of court (related to order of specific conduct) Enforcement 1 - 24

25. Copyright © 2013 Pearson Canada Inc. Process for resolving disputes outside of the courts Main methods –Negotiation –Mediation –Arbitration (Continued) Alternative Dispute Resolution 1 - 25

26. Copyright © 2013 Pearson Canada Inc. Negotiation Parties discuss the problem with each other in order to find a solution Process requires cooperation and compromise May be conducted through representatives Process may enhance relationship Agreement may not be legally binding (Continued) Alternative Dispute Resolution (Continued) 1 - 26

27. Copyright © 2013 Pearson Canada Inc. Mediation Neutral outsider helps parties settle the dispute Communication facilitated by mediator –Finds common ground –Encourages concessions Mediator does not make decision Sometimes required before court will hear case Court may affirm mediated resolution (Continued) Alternative Dispute Resolution (Continued) 1 - 27

28. Copyright © 2013 Pearson Canada Inc. Arbitration Parties agree on an independent third party (or panel of three) to make a decision that will be binding Often required in contract; mandated in collective bargaining Arbitrators are usually specialists in the matter under dispute Decision cannot be appealed although procedure may be reviewed by the court (Continued) Alternative Dispute Resolution (Continued) 1 - 28

29. Copyright © 2013 Pearson Canada Inc. Advantages –Parties maintain control of the solution –Disputants determine and schedule process –Lower costs associated with process –Matters remain private –Preserves good will –Can achieve a win-win resolution (Continued) Alternative Dispute Resolution (Continued) 1 - 29

30. Copyright © 2013 Pearson Canada Inc. Disadvantages –Courts have more power to extract information –Decisions do not follow precedent –Agreements may not be enforceable –Inappropriate when power imbalance exists –No public record of dispute or decision Alternative Dispute Resolution (Continued) 1 - 30

31. Copyright © 2013 Pearson Canada Inc. Regulatory bodies make decisions with respect to statutes or regulations Administrative decisions must be within jurisdiction and comply with the Constitution Act (1867), the Charter and principles of procedural fairness Court may review decision process and decision to determine if appropriate (Continued) Administrative Law 1 - 31

32. Copyright © 2013 Pearson Canada Inc. Privitive clauses may protect tribunal decisions from judicial review Advantages of tribunals (compared to courts): –More efficient –Usually involve experts in field under dispute –Faster, more cost-effective decision-making Administrative Law (Continued) 1 - 32

33. Copyright © 2013 Pearson Canada Inc. Civil law – individual sues another for compensation (or other remedy) Criminal law – state prosecutes accused to punish Only the federal government has the power to make criminal law Provincial governments have the power to create and enforce statutes (similar to criminal law in terms of penalties) Criminal Law 1 - 33

34. Copyright © 2013 Pearson Canada Inc. Burden of proof on prosecutor –Must prove beyond a reasonable doubt –Must show wrongful conduct took place –Must show intention to commit the act Strict liability offences –May only need to show offence took place –Only defence is due diligence (Continued) Criminal Process 1 - 34

35. Copyright © 2013 Pearson Canada Inc. Power to arrest held by police and private citizens Judicial officials issue search warrants, arrest warrants, and summons to appear Categories of crimes –Summary conviction - minor offence –Indictable offence - more serious offence (Continued) Criminal Process (Continued) 1 - 35

36. Copyright © 2013 Pearson Canada Inc. Judicial process –Summary – exchange of information and negotiation –Indictable offence – more involved and lengthy Plea bargaining – pleading to lesser offence When a matter proceeds to trial: –Prosecutor presents witnesses and evidence –Defense then presents witnesses and evidence –Decision made by judge or jury –Sentence – fine/imprisonment Criminal Process (Continued) 1 - 36