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Copyright © 2013 Pearson Canada Inc.
Chapter 1The
Canadian
Legal System
Legal Fundamentals for Canadian Business
Third Edition
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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
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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)
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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
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Copyright © 2013 Pearson Canada Inc.
Categories of Law
• Substantive law– Rules determining behaviour
• Procedural law– How the legal process works
(Continued)
Categories of Law
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• Public law– Regulates our relationship with government
• Private or Civil law– Regulates personal, social, and business
relationships
Categories of Law(Continued)
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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
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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
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• 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
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• 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)
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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)
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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
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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)
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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)
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• 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
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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
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• Plaintiff presents case– Burden of proof rests with plaintiff– Balance of probabilities– Direct examination of witnesses– Cross-examination by defense lawyer
(Continued)
Trial
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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)
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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)
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Copyright © 2013 Pearson Canada Inc.
• Damages (monetary compensation)• General – non-quantifiable losses• Special – quantifiable losses
• Punitive – to punish the wrongdoer
(Continued)
Remedies
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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)
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• 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
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• Process for resolving disputes outside of the courts
• Main methods– Negotiation– Mediation– Arbitration
(Continued)
Alternative Dispute Resolution
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• 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)
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• 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)
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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)
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• 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)
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• 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)
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• 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
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• 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)
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• 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
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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
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• 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)
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• 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)
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