Midterm

Question 1

What is the difference between guaranty and warranty?

Answer 1

Warranty limits your legal rights, while guaranty does not limit your legal rights.

Question 2

How does a warranty affect your legal rights as a consumer?

Answer 2

When you sign a warranty card, you may sign away your legal obligation to return the product to the place of purchase for a full refund or replacement. Warranty protects the seller against the consumer.

Question 3

What does the Sale of Goods Act imply regarding warranties and guarantees?

Answer 3

The Sale of Goods Act implies a guaranty (implied) where you have not contracted yourself out. This means you could potentially get your money back.

Question 4

What does a guaranty provide as a legal right?

Answer 4

A guaranty provides the legal right to return the object to the place of purchase and get a refund or exchange the product.

Question 5

What does the Consumer Protection Act protect you from?

Answer 5

The Consumer Protection Act protects you from unfair acts when buying a product or service from an individual or business.

Question 6

What are the three parts typically found in every legal case?

Answer 6

In every legal case, you have the facts, the decision, and the reason for the decision, often referred to as the “Ratio Decidendi”

Question 7

What is law?

Answer 7

Law is a set of rules and regulations that govern the behavior and interactions of individuals and entities within a society.

Question 8

What is law, and how does it change over time?

Answer 8

Law is a set of rules and regulations created by the people to govern society. It has the ability to change to accommodate evolving lifestyles and societal needs. It regulates change and adapts as society changes.

Question 9

Where does the concept of law originate from?

Answer 9

Law has its origins in religion, philosophy, customs, and government. In the present, it comes from Statute (government law, act, code, legislation bylaw) and Common Law (judge-made law, precedent, previous court decisions).

Question 10

What is jurisprudence?

Answer 10

Jurisprudence refers to the theory or philosophy of law, examining the fundamental principles and concepts underlying the legal system.

Question 11

What were the grounds for divorce prior to 1969 under the Divorce Act?

Answer 11

Up until 1969, divorces could only be granted on grounds such as adultery, sodomy or bestiality, rape, or homosexual acts.

Question 12

What changes were made to the Divorce Act regarding grounds for divorce?

Answer 12

The Divorce Act was amended to include physical/mental cruelty towards one another without consent as a ground for divorce.

Question 13

What constitutes marital breakdown in current years for divorce purposes?

Answer 13

Marital breakdown in current years can be established by intentional separation for at least one year, physical/mental cruelty, or adultery.

Question 14

What are the key parties involved in Civil Law cases?

Answer 14

In Civil Law cases, you have the Plaintiff (or Respondent) and the Defendant (or Appellant).

Question 15

Who are the main parties in Criminal Law cases?

Answer 15

Criminal Law cases involve the Crown (or Appellant) and the Accused (or Respondent). These roles can sometimes be reversed depending on the stage of the legal process.

Question 16

What is the First Principle of Law?

Answer 16

The First Principle of Law states that everyone is presumed to know the law, and ignorance of the law is not considered a valid excuse.

Question 17

Why is it important to know your legal position before making life decisions?

Answer 17

it is crucial to understand your legal position before actions like driving, marriage, or accepting partnerships, as your legal status can have significant implications.

Question 18

What is the difference between warranties and guarantees when purchasing items like vehicles or appliances?

Answer 18

warranties provide protection but limit your legal rights, while guarantees (implied by law) are stronger and may allow you to get your money back even without a warranty.

Question 19

What is the First Principle of Law?

Answer 19

The First Principle of Law states that ignorance of the law is no excuse, meaning that everyone is presumed to know the law.

Question 20

What are the two main sources of law?

Answer 20

The two primary sources of law are Statute (legislation, codes, bylaws) and Common Law (judge-made law, precedent from previous court decisions).

Question 21

What does “in control” mean in the context of law?

Answer 21

“In control” implies having the intention and ability to set a course of action into motion, which is essential in various legal contexts.

Question 22

What are the different types of law courts in Canada?

Answer 22

Canada has different types of courts, including federal courts (e.g., Ottawa Supreme Court, tax court, federal court), judicial tribunals (e.g., Court of Appeal, kings bench, provincial, justice and peace), and administrative tribunals (e.g., Human Rights Commission, Highway Traffic Board).

Question 23

What are the main methods for settling disputes in business contracts?

Answer 23

In business contracts, alternative dispute resolution (A.D.R.) methods include arbitration and mediation, which are private, non-binding, and can be less adversarial than going to court.

Question 24

What are the advantages of A.D.R. (Alternative Dispute Resolution)?

Answer 24

Advantages of A.D.R. include speed, cost-effectiveness, the ability to choose an adjudicator, confidentiality, and the potential for preserving ongoing relationships.

Question 25

In labor law, who often serves as members of arbitration boards?

Answer 25

In labor law, retired judges and lawyers are often part of arbitration boards, especially in cases where there is no arbitration agreement.

Question 26

How do international disputes get resolved through arbitration?

Answer 26

International disputes are often resolved through organizations like the Court of International Arbitration in London, which specializes in international arbitration.

Question 27

What is a common requirement before setting a matter down for trial in legal cases?

Answer 27

In many legal cases, you are required to attempt mediation before proceeding to trial, and pre-trial conferences are applicable to all civil cases, including family law cases.

Question 28

What is the primary purpose of a warranty?

Answer 28

Warranties primarily protect the seller, not the buyer. They typically provide coverage for a limited time or specific conditions.

Question 29

How does entering into a warranty contract affect your legal rights?

Answer 29

When you enter into a warranty contract, it limits your civil rights to what the seller is obligated to do for a predetermined period. You usually can’t get your money back under a warranty.

Question 30

What is the advantage of making a purchase without a warranty?

Answer 30

when you buy a product without a warranty, you are not limited by a specific time frame for protection. Your legal rights may extend beyond the warranty period.

Question 31

What caution should you exercise when offered an extended warranty?

Answer 31

When offered an extended warranty, be careful and inquire about who is providing the warranty. It’s not always the same entity that sold you the product. Extended warranties are often a significant source of profit for appliances and other products.

Question 32

What was the state of divorce laws in 1969, and what was the primary requirement for divorce at that time?

Answer 32

In 1969, divorce laws in Canada required specific grounds for divorce, such as adultery.

Question 33

How has the divorce law evolved in 2023, and what is now required for divorce?

Answer 33

In 2023, divorce laws in Canada typically require proof of a marriage breakdown, which can be established through reasons such as adultery, intentional separation for one year, or being treated with mental or physical cruelty.

Question 34

What is the role of jurisprudence in the legal system, and how does it relate to statutes and common law?

Answer 34

Jurisprudence is the field of study that focuses on how courts interpret and give meaning to the words of the legislature, i.e., Parliament. Statutes can be considered the skeleton of the law, while common law provides the clothes, or the application of the law.

Question 35

What are some examples of federal courts in Canada?

Answer 35

Federal courts in Canada include the Ottawa Supreme Court and the Tax Court, which handle federal legal matters.

Question 36

What are judicial tribunals, and what are some examples of them?

Answer 36

Judicial tribunals are legal bodies responsible for resolving specific types of cases. Examples include the Court of Appeal, King’s Bench, provincial courts, and justice and peace courts.

Question 37

What distinguishes administrative tribunals from regular courts, and what types of cases do they handle?

Answer 37

Administrative tribunals, while they may look like courts, are distinct and handle specialized cases. Those from King’s Bench handle civil matters over $30,000, criminal cases, estates/wills, and family law. Provincial tribunals often deal with 97% criminal law cases. Justice and peace tribunals handle preliminary hearings, small claims up to $30,000, and quasi-criminal cases (e.g., speeding tickets, city laws, fishing licenses).

Question 38

What is the focus of civil law, and who are the main parties involved in civil cases?

Answer 38

Civil law pertains to disputes between individuals. In civil cases, one party is the plaintiff (the one suing), while the other party is the defendant. If a decision is appealed, the defendant may become the appellant, and the plaintiff would be the respondent.

Question 39

What characterizes criminal law, and who are the primary parties in criminal cases?

Answer 39

Criminal law addresses offenses against the state or society. The Crown (representing the state) prosecutes the accused. If an appeal occurs, the Crown becomes the appellant, and the accused is the respondent.

Question 40

What are administered tribunals, and what role do they serve in the legal system?

Answer 40

Administered tribunals are legal bodies created by specific statutes to carry out the objectives outlined in those statutes. They regulate and oversee specific areas of law, such as human rights, traffic violations, labor relations, or professional ethics.

Question 41

What is jurisdiction in the legal context, and how does it relate to administrative tribunals?

Answer 41

Jurisdiction refers to the official power to make legal decisions and judgments. Administrative tribunals have limited jurisdiction, as they are created by statutes for specific purposes and do not have the comprehensive authority of regular courts.

Question 42

What are some alternative methods for settling disputes in business contracts?

Answer 42

Alternative methods for settling disputes in business contracts include ADR (Alternative Dispute Resolution), such as arbitration and mediation, as alternatives to going to court.

Question 43

How do courts differ from arbitration and mediation in terms of their characteristics and processes?

Answer 43

Courts are public, involve adjudication, have binding decisions, set precedents, are appealable, and their judgments are court-enforced. In contrast, arbitration and mediation are private, non-binding (in the case of mediation), have no precedents, have limited appeals (arbitration), and are enforced through contracts, not court decisions. Arbitration uses adjudication, mediation is facilitated negotiation

Question 44

What is the typical approach when a dispute arises between two contracting parties who want to avoid going to court?

Answer 44

In situations where parties want to avoid court, they may opt for arbitration or mediation. Mediation aims to facilitate negotiation and reach a settlement. If mediation is unsuccessful, parties may resort to arbitration, where both parties agree that the decision will be binding.

Question 45

What is the role of precedent in the legal system, and how does it differ between courts and alternative dispute resolution methods?

Answer 45

Precedent means that courts must follow the decisions of equal or higher courts in similar cases. Arbitration and mediation typically do not establish binding precedents.

Question 46

How does the appeal process differ between court decisions and those made in arbitration or mediation?

Answer 46

Court decisions are typically appealable up to the Supreme Court, while decisions in arbitration are generally considered final. In mediation, there is no intent to establish an appeal process.

Question 47

How is the enforceability of judgments different between courts and arbitration or mediation?

Answer 47

Courts enforce their judgments through legal processes. In arbitration or mediation, enforceability typically occurs through contracts established by the parties.

Question 48

What are some advantages of ADR (Alternative Dispute Resolution)?

Answer 48

Advantages of ADR include speed, cost-effectiveness, the ability to choose the adjudicator or panel, confidentiality, and the potential for preserving ongoing relationships.

Question 49

How does labor law handle disputes, and who often serves on arbitration boards in labor cases?

Answer 49

Labor law disputes may be resolved through arbitration if there’s no arbitration agreement. Arbitration boards often include retired judges, lawyers, or other professionals experienced in labor-related matters.

Question 50

How are international disputes commonly resolved, and what’s an example of an institution for international arbitration?

Answer 50

International disputes are often resolved through international arbitration. The Court of International Arbitration in London is an example of an institution that handles international arbitration cases.

Question 51

What is the typical requirement before setting a matter down for trial in legal cases, including family law?

Answer 51

In many legal cases, including family law, parties are often required to attempt mediation before proceeding to trial. Pre-trial conferences may apply to all civil cases.

Question 52

What is the Supreme Court of Canada’s role in the legal system?

Answer 52

The Supreme Court of Canada is part of the Appellate Court system, primarily serving as a review court. It doesn’t listen to witnesses but reviews cases from lower courts. The court can sustain, set aside, order a new trial, or modify sentences.
o Court decides to:
▪ Sustain – no change
▪ Set aside – quash – to overrule, if evidence was not sufficient, etc.
▪ Order a new trial
▪ Bury a sentence (redo the sentence upward or downward)
▪ 7 Judges (either 3, 5, or 7. Most often 3) always odd, Sup.of Can = 9 judges
▪ From court of appeals goes to supreme court of Can

Question 53

What is the jurisdiction and purpose of the King’s Bench and Justice of the Peace courts?

Answer 53

These courts, often referred to as “people’s courts,” handle various cases, including wills/estates, civil claims up to $30,000, family law, and certain criminal cases. They do not deal with summary convictions.
* Trial Court – 9 judges (3, 5, 7, or 9)
o Always an odd number of judges so there is a decision
o Judge hears evidence and applies laws decide guilty not guilty
o Judge + Jury; judges judge of law only, Jury is judge of facts (evidence)- decides if guilty or innocent
▪ civil law= 6 jurors, criminal law= 12 jurors (reasonable people)

Question 54

What characterizes trial courts in terms of judges and jury members?

Answer 54

Trial courts typically consist of 3, 5, 7, or 9 judges to ensure an odd number for decision-making. Judges hear evidence and apply laws to decide guilt or innocence. In some cases, a judge and jury are involved, with the jury responsible for determining facts (evidence).

Question 55

What types of cases does the Federal Court handle?

Answer 55

The Federal Court handles suits against the federal government and matters related to tax appeals, such as tax assessment disputes.

Question 56

What are the primary functions and responsibilities of the Provincial Court?

Answer 56

The Provincial Court deals with over 95% of all criminal cases, including preliminary hearings, and some quasi-criminal matters. It also handles some civil cases and serves as a small claims court for cases involving up to $30,000. The court is often used to set examples or place individuals in rehabilitation programs. * Every civil charge starts here

Question 57

What is the role of a Justice of the Peace (JP), and in which types of cases are they typically involved?

Answer 57

JPs typically handle minor criminal matters, especially traffic and speeding tickets, as well as quasi-criminal matters. They have the authority to release individuals who have been arrested for minor offenses on bail. JPs are often elderly, well-respected individuals who are not formally trained in law.

Question 58

What are judicial tribunals, and how does their jurisdiction vary?

Answer 58

Judicial tribunals are legal bodies responsible for resolving specific types of cases. Their jurisdiction increases with their position in the court hierarchy, meaning higher-level courts have broader jurisdiction.

Question 59

What characterizes administrative tribunals, and what is their role?

Answer 59

Administrative tribunals, often referred to as quasi-judicial bodies, are created by specific statutes to carry out the objectives outlined in those statutes. They regulate various professions and areas, such as the Highway Traffic Board, Labor Relations Board, Liquor and Gaming Commission, Parole Board, Human Rights Commission, school boards, and many others.

Question 60

What is the primary distinction between criminal law and civil law, and how does this relate to the standard of proof?

Answer 60

Criminal law involves the relationship between the state and the individual, while civil law deals with disputes between individuals. In criminal law, the standard of proof is “beyond all reasonable doubt,” whereas in civil law, it is “a balance of probabilities.”

Question 61

What are the two categories of criminal law offenses in Canada?

Answer 61

There are two categories of criminal law offenses in Canada: Summary Conviction (less serious offenses) and Indictable Offenses (more serious offenses).

Question 62

What characterizes Summary Conviction offenses, and what are some examples of such offenses?

Answer 62

Summary Conviction offenses are less serious and may result in fines up to $500 or imprisonment for up to 6 months (or 2 years less one day), unless otherwise specified. Examples of such offenses include theft, theft under $5000, causing a disturbance in a public place, soliciting for prostitution, joyriding, common assault, dangerous driving, and driving while inhibited.

Question 63

What happens if an individual with a long record commits a Summary Conviction offense?

Answer 63

If an individual with a long record commits a Summary Conviction offense, the state may choose to change it to an Indictable Offense, leading to a more severe punishment.

Question 64

Under which jurisdiction are Summary Conviction offenses typically handled in Canada?

Answer 64

Summary Conviction offenses generally fall under the jurisdiction of the provincial court.

Question 65

What characterizes Indictable Offenses, and how are penalties determined for these crimes?

Answer 65

Indictable Offenses are serious crimes, and each offense has its own specified penalty. For example, murder carries a mandatory life sentence, with distinctions between first-degree murder (premeditated) cannot apply for parole until 25 years served (sentence = life in prison),

second-degree murder (not premeditated) also mandatory life in prison, can apply for parole after 10 years
and manslaughter up to life in prison (less than murder), did not intend to kill but intended act of assault but person dies (e.g., hit someone and they fall and hit head and they die).

Other examples include armed robbery (minimum of 2 years and up to 14 years (“a mans home is his castle”) , sexual assault, fraud, breaking and entering, with penalties ranging from 2 years to life in prison.

Question 66

What is the general legal procedure when a person is charged with a criminal offense in Canada?

Answer 66

If a person is charged with a summary conviction offense, they will typically follow a procedure in the provincial court. The provincial court has absolute jurisdiction over all summary conviction matters. For indictable offenses, the person appears in the provincial court, and the charges are read. They are then given the right of election to choose where they want to be tried, either in the Queen’s Bench (alone or with a judge and jury) or in the provincial court.

Question 67

What is the purpose of a preliminary hearing in the legal process for indictable offenses in Canada?

Answer 67

If a person chooses to be tried in a higher court (such as the Queen’s Bench), a preliminary hearing is held in the provincial court. The preliminary hearing serves to determine whether there is enough evidence to proceed to a trial. If a person chooses the provincial court, no preliminary hearing is held, and a trial date will be set.

• Provincial court has absolute jurisdiction over all summary conviction (small claims court)

Question 68

What are the two main reasons for conducting a preliminary hearing in the legal process for indictable offenses in Canada?

Answer 68

The two main reasons for a preliminary hearing are:
1. To allow the provincial court judge to determine if there is sufficient evidence to send the case to trial (committal to trial) or to discharge the accused if there is no evidence against them.
2. To provide the accused person with an opportunity to hear all the Crown’s evidence against them, observe witnesses, and receive full disclosure of the case, ensuring that they are not surprised during the trial.

Question 69

Can an accused person choose to waive a preliminary hearing? What are the potential implications of doing so?

Answer 69

Yes, an accused person can choose to waive a preliminary hearing and proceed directly to trial. However, in all criminal cases, the Crown must provide full disclosure. Waiving a preliminary hearing might expedite the process, but it can also have implications for the defense, as it may not provide adequate time for preparing the case. Additionally, knowledgeable individuals may use delays to their advantage as the longer the delay, the more memories may fade. If a trial does not occur within a certain timeframe, the charges can be dropped.

Question 70

What is a preliminary hearing in the context of Canadian criminal law?

Answer 70

A preliminary hearing is a legal proceeding in the Canadian criminal justice system held in the provincial court for indictable offenses. Its primary purposes are to determine if there is sufficient evidence to proceed to trial (committal to trial) and to provide the accused person with an opportunity to hear the Crown’s evidence, observe witnesses, and receive full disclosure of the case. The accused can choose to waive a preliminary hearing to proceed directly to trial, but this decision has potential implications for the defense.

Question 71

What are the primary purposes of a preliminary hearing in Canadian criminal law, and what is the onus of proof at this stage?

Answer 71

1. A preliminary hearing serves to allow the judge to hear the evidence that the state has against the accused and decide whether to send the case for trial (committal for trial).
2. It provides the accused with an opportunity to hear the state’s evidence, observe witnesses, and question them without the stress of being found guilty or innocent.
3. In a criminal proceeding, the onus of proof does not rest upon the accused at the preliminary hearing but rather on the prosecution, which must prove guilt beyond a reasonable doubt. The accused is considered innocent until proven guilty beyond a reasonable doubt. Any doubt at the preliminary hearing is resolved in favor of the prosecution.

Question 72

preliminary hearing

Answer 72

• 99.9/100 accused is committed to trial
• In a criminal proceeding the Onus of Proof (not at preliminary) rest upon the prosecution to prove me guilty beyond all reasonable doubt.
  o Crown has to prove guilty beyond a reasonable doubt, if cant prove, let go
• Innocent until proven guilty beyond a reasonable doubt, state has
  to prove me guilty, not prove my innocence
• Defense does not need to call witnesses
• Accused persons best defense is that of delay.
• Trial in provincial and queens bench are the same –hears all the evidence and forms the facts and the judge then makes the decision and gives the reason or reasons for the decision.
• Trial before judge and jury – jury trier of the facts and the judge
  becomes the trier of the law.
• An experienced criminal will try to delay the hearing. Looks for changes in witness’s stories.
  -Onus on prosecutor: reverse onus, have to prove yourself innocent (prove didn’t know something was stolen)

Question 73

What are quasi-criminal matters in the Canadian legal system, and can you provide examples?

Answer 73

Quasi-criminal matters are offenses that are neither under the Criminal Code of Canada nor civil in nature. Examples include fishing without a license, bootlegging, speeding tickets, and jaywalking traffic tickets.

Question 74

What is the Small Claims Court, and what types of claims can be heard in this court?

Answer 74

The Small Claims Court handles claims of up to $50,000, and the proceedings take place within the provincial court. The cost to have a case heard in Small Claims Court is typically around $20 to $30.
* Deals with wills and estates
* Claims excess of 30000
* Family law division
o Divorce
o Annulment of marriage
o Maintenance
o Custody
o Access
o Adoption
o Paternity
o Division of matrimonial property

Question 75

Spousal Relationship

Answer 75

two persons regardless of sex that have cohabited together continuously for 24 months.
o Cohabitation – arrangements concerning shelter, social activity, sexual and personal behavior, domestic services, societal attitude, conduct respecting children, financial arrangements
o Continuously – temporary interruption will not void your continuous cohabitation.
□

Question 76

Who sits on the jury?

Answer 76

• 12 reasonable people
• Jury decision must be unanimous. If no consensus is made it is called a “hung jury”

Question 77

Annulment

Answer 77

• 2 persons go through a form of marriage but not legally married (1 person usually thinks legally married)
• If man marries 2 women (bigamy), the 2nd marriage is declared nullity (as if the marriage never took place, went through form of marriage but it is not legal and is annulled).
• Marriage not legal until consummated then go to court to get
  annulled (consummated then divorce, not consummated then annulment)
• No division of property
• If married then cohabitate with someone else dealt with in the order they occurred.
• Court declaration that a marriage is null + void

Question 78

Custody and access rights

Answer 78

• Tough area to practice in (highly emotional)
• Court decides who is going to be the custodial parent – court asks what is in the best interest of the child
• Usually give one parent custodial rights and the other access rights.
• Non custodial parent usually gets access rights – e.g., 2 evenings a week, alternate weekends/holidays
• Best if parents can work this out themselves, encourage shared custody
• Provincial law – Children’s Law Act

Question 79

Adoption

Answer 79

• Take place through courts or in a private adoption
• Tough to adopt child in this province

Question 80

Apprehension

Answer 80

• If children are neglected then (government) social services can go in and apprehend the children
• Return children, contemporary apprehension of children, or permanently take children

Question 81

Filiation

Answer 81

• Naming of the father to unwed mothers
• Paternity
• Under Children’s Law Act – make agreement to sign paternity and agreement of child support (maintenance), if won’t do this then she can summon him to court and have the court declare him the father (both testify) (court can ask for blood test or DNA test – if they refuses than it can be held against them, judge can assess maintenance to all 3 guys, then subject themselves to DNA test (court will give all the information that is needed for this test) and find out the true father and then the true father has to pay child support but if the child is adopted then you do not have to pay anymore child support (maintenance payments).
• Payments are not tax deductible, taxes payable
• Mother does not have to pay income tax on the maintenance paid to her.

Question 82

Family Property Act

Answer 82

• Takes everything that the husband and wife have and put them into a common pot. Everything I then given 50/50, unless you can provide proof the other party isn’t entitled to 50%

Question 83

Pre-Nuptial Agreement (pre-spousal or pre-marital)

Answer 83

• Common among elderly
• Has to be done up in a certain way
• You can exempt yourself from the Family Property Act
• The court may void the agreement if it is unsociable (“unfair”)

Question 84

Inter-spousal Agreement

Answer 84

• Takes place after a couple is already married
• An agreement made between two spouses on how to divide family property
• Encouraged for the couples who are in the process of breaking up to enter into interspousal agreements
• This would save money because then they don’t have to go to court and have less lawyer time (less legal fees)

Question 85

A contract

Answer 85

“A contract is an agreement between two or more capable people for a legal consideration to do or not to do some lawful and genuinely intended act”

• Contract is a mere exchange of promises; recognize exchange of promises contracted gives the right to and obligation to be enforced by law

Question 86

What is a contract, and what role does contract law play in legal relations and commerce?

Answer 86

-A contract is a relationship between people that gives rise to rights and obligations, enforceable by law. It is more than just an agreement. (offer + acceptance, contract is more than that)

-Businesses heavily rely on contracts, and contract law governs the promises and obligations that parties must keep or face damages if they breach the contract.

-Contract laws form the foundation of commercial relations, covering areas such as credit, property, insurance, and the sale of goods.

-It is the only area of law where individuals and businesses can establish their own rules and requirements, which the courts will enforce.

-A contract is defined as an agreement between two or more capable persons for legal consideration to do or not do some lawful and genuinely intended act.

-Contracts can be established in various ways, including verbal agreements, and they play a significant role in our society and personal lives.

• If you break a contract, the other person has the right to take you to court
• As soon as you walk into a restaurant you enter into a contract
• In someone’s home – not a contractual agreement so you have no claim
• A taxi is different from your friends car because of the contractual agreement with taxi but not with friend (do at your own risk)

Question 87

5 Essentials Elements of a Contract (the tree trunk)

Answer 87

1. Capacities of the Parties
2. Mutual Agreement
3. Genuine Intention
4. Legal Consideration
5. Lawful Subject Matter

• All five elements of a contract must be met in order to have a contractual agreement. (Legally binding if all are present)
• Looking at any circumstance and find that all 5 requirements are included for a contract to be present (if any missing = do not have a contract)
• If any one or more elements are missing, there is NO contractual relationship
• Writing is NOT required to have a contract
• Writing may be required to have an enforceable contract

Question 88

1) Capacity of the Parties
Who is legally capable to make a contract?

Answer 88

Everyone has legal capacity to enter a contract but some special classes to be looked at.

The capacity of the parties in a contract refers to their legal ability to understand the contract’s terms, make informed decisions, and enter into a binding agreement.

Capacity is crucial in contract law to ensure that both parties are on equal footing and that the contract is formed voluntarily and without undue influence or duress.

Parties lacking capacity, such as minors or individuals with mental impairments, may have limited enforceability of their contracts or the option to void them.

Contracts entered into by parties without the requisite capacity are often voidable, meaning they can be canceled by the party lacking capacity or their legal representative.

-infant, mentally incompetent, alien, bankrupt, unlicensed tradesman

Question 89

Infant

Answer 89

• A contract made by an infant is void or voidable at the option of the infant (unless it is a contract for necessaries)
  o Void: can be repudiated (denied, never entered into, not going through with it, give money back, essentially treated as if it never existed.)
  o Voidable: can be either repudiated or enforced (by the infant)
  o Any person under the age of 18 is considered an infant, according to civil law
  o 12–18 you are considered a youth, if you do an offence you will be charged under the criminal act, youth criminal justice act.
  o A child under the age of 12 cannot be charged with an criminal offence

Question 90

What are “necessaries” in the context of contracts involving infants, and how do they affect the enforceability of such contracts?

Answer 90

“Necessaries” refer to goods or services that are essential for the well-being and support of an individual. These are typically items required for the infant’s basic needs, such as food, clothing, shelter, medical care, and education.

Contracts for necessaries made by an infant are generally enforceable, even if the infant would otherwise have the right to void or repudiate other contracts.

The rationale is to ensure that infants have access to essential items and services for their well-being, and these contracts can be enforced against them.

□ By necessary, that what is befitting the infant’s station in life. I life style that an infant is accustom to.
□ adult entering into contract with infant at own risk (even if lie about age, can still void)

Question 91

Situation #1: On September/2010 a 17-year-old infant registers for 1st year of university in October/2010 is disappointed that his social life is zero; he goes to his senior colleagues and asks for help. The seniors say that he needs a set of wheels so on Monday of that week he goes to Jo’s Used Car lot and Jo and he entered into an agreement to buy the car for $4000 and that he would put $200 down on the car and come back on Friday with $3800 (suppose to go to tuition) and he does so Jo gives him the keys and he drives off. January/2011 the infants social life has not improved so goes back to his senior colleagues and says that he bought a car but his social life still is no good but they say that he bought the wrong car. So the infant goes back to Jo’s and has no complaints and is honest but the car is not suitable and there is nothing on the lot that he wants so he goes to give the keys back and wants his $4000 back. Jo says a deal is a deal. The infant (plaintiff) sues Jo (defendant).

Answer 91

□ Conclusion: rule in favor of the plaintiff because the infant has the option to void a contract unless it is for a contract for necessaries (could void even if damage) reason: on going contract so infant can void under law
□ if had paid in full he would not have been able to void but b/c contract is currently on going can void (if paid in full contract would have been fulfilled so can’t void)
□ can void within a reasonable time period

□ The infant has the right to choose to void the contract

Question 92

Situation #2: same facts but on Wednesday X comes along and sees the car and offers Jo $5000 for the car and sells him the car and X takes the car home. The infant shows up on Friday with money but doesn’t see the car. The infant gives Jo the money but Jo gives the money back and the down payment and says that he is under the age of 18 years old and doesn’t want to deal with him. The infant says that he knows that X bought the car for $5000 then sues Jo for $1000 compensation on the profit that Jo made selling his car.

Answer 92

□ Conclusion: rule in favor of the plaintiff because Jo has obligation to supply the car and the infant has the right to the car because of the down payment
□

Question 93

What period of time does an infant have to void a contract?

Answer 93

• Adult is able to influence the infant so law gives them a right to void the contract.
  o An infant has the right to void a contract until he reaches the age of the majority and therefore for a reasonable period of time (depends on the circumstances)

-if infant sold car, can recall it back (necessities; food, shelter)

Question 94

Exception

Answer 94

unless its for a contract for necessaries, meaning anything that is befitting to the infants station of life (e.g., law recognizes that each of us enjoy a certain standard of living)

The exception to an infant’s right to void a contract is when the contract pertains to “necessaries.” Necessaries include goods and services that are essential for the well-being and support of the infant, such as food, shelter, clothing, and medical care.

Contracts for necessaries are generally enforceable, and the infant cannot void them.

The exception is based on the recognition that individuals, including infants, have a certain standard of living that requires access to essential items and services.

Question 95

Example: if a rich 17 year old girl buys a $5000 bracelet and then decides that she doesn’t want it she still is bound to the contract (because it fits her standard of living). A poor girl goes into the same store and buys the same $5000 bracelet and then realizes that she cannot afford it and returns it and she is not bound to the contract (because it does not fit her standard of living).

Answer 95

depends on each case, decided on its own merits

Question 96

Are parents legally responsible for the wrongdoing of their children?

Answer 96

• No, if the parents are not in control of the child.
• Exception: Parent is responsible if child is in the direct control of the parent at the time of the incident and the parent knows that the child has the propensity (likelihood) to commit the unlawful act.
• (Throwing the rock example. If a parent knows that child likes to
  throw things, parent is liable if he/she does. If the parent doesn’t, know, they are not liable)
• BC and Manitoba, parents are legally responsible for the
  wrongdoing of the child if it can be shown that the child intentionally committed the wrongful act.

Parents must provide until 18, or if handicapped or attending post-secondary have obligation to pay
-if infant is in need of necessity (can hold parents liable to pay)

Question 97

Mentally Incompetent (Handicapped)

Answer 97

In contract law, when an individual who is mentally incompetent or challenged due to intoxication by alcohol and/or drugs enters into a contract, the legal status of the contract may vary depending on the nature of the goods or services involved (necessaries or non-necessaries).

For contracts related to non-necessaries, the individual who is mentally incompetent or intoxicated is generally not liable, and the contract may be voided.

For contracts related to necessaries, the individual may still be liable, but to establish this liability, it is necessary to prove two key elements:
1. Satisfy a court that the person was indeed mentally incompetent or challenged or demonstrate that the individual entered into the contract while under the influence of alcohol and/or drugs.
2. The other party knew that the person was mentally handicapped or influenced by alcohol or drugs.

o Every case is decided on its own merits
o E.g. mentally challenged man brought 5 suits, 6 shoes, cars, and condo. The sellers thought its strange – had to/ought to have known mentally challenged

Question 98

What is the legal status of individuals who are mentally incompetent or handicapped in the context of contracts?

Answer 98

Contracts entered into by mentally incompetent or handicapped individuals may be void or voidable, depending on the individual’s capacity to understand and consent to the contract.

The law provides protections for individuals who lack the mental capacity to make informed decisions.

Contracts may be void if the individual is determined to be completely lacking in mental capacity and cannot understand the nature and consequences of the contract.

In cases where the individual’s mental capacity is limited but not completely absent, the contract may be voidable if the person lacked the capacity to understand the contract at the time of its formation.

The law aims to strike a balance between respecting the rights of individuals with mental disabilities and protecting against exploitation.

Question 99

Alien

Answer 99

• A person who is not a citizen of Canada
  In contract law, the term “alien” typically refers to a person who is not a citizen or national of the country in which the contract is being formed
• In Canada we do not distinguish aliens in this country and contract is lawful
• Enemy Alien – person of another country that Canada is in a declared state of war with
  o Contract is both unlawful and illegal (forbidden)
  o Both of these terms can be used interchangeably
  o Unlawful – contrary to the law
  o Illegal – would be an offence, criminal offence
  o Contract is suspended

Question 100

Bankrupt

Answer 100

Bankruptcy is a legal procedure that allows an individual to seek discharge from their debts, effectively giving them a clean slate to start anew.

While in a state of bankruptcy, there are certain restrictions on entering into contracts. In most cases, individuals in bankruptcy may contract or suspend up to a limited amount, typically around $500, specifically for purchasing necessities.

Contracts for non-necessities during the bankruptcy process may be subject to restrictions or may not be allowed.

Question 101

Unlicensed Tradesman

Answer 101

When dealing with an unlicensed tradesperson, particularly in the context of a contract for services like home renovations, legal implications may arise.

If an unlicensed tradesperson enters into a contract with a homeowner, and the homeowner refuses to pay after the services are rendered, the unlicensed tradesperson may not have legal recourse to sue for payment. This is because the contract is considered unlawful due to the absence of a required license for the trade.

In cases where the homeowner is dissatisfied with the quality of work performed by an unlicensed tradesperson, they may be able to sue for damages. However, whether the homeowner can sue often depends on whether they knew the tradesperson was unlicensed at the time of entering into the contract. If they were aware of the unlicensed status, their ability to sue for damages may be limited.

Homeowners may be tempted to hire unlicensed tradespeople for cost savings, as underground trades can often offer lower prices. Regardless of the choice, it is advisable to always obtain a receipt and maintain clear records to protect the homeowner’s interests and ensure a basis for potential legal actions or claims.

Question 102

What are the three different methods for carrying out a business, and how do they differ from each other?

Answer 102

1. Sole Proprietorship: In this method, a business is owned and operated by a single individual. The owner has full control and responsibility for the business’s operations, profits, and losses. However, they are also personally liable for the business’s debts and legal obligations.
2. Partnership: A partnership involves two or more individuals or entities coming together to operate a business. Partners share the responsibilities, profits, and losses based on the terms outlined in a partnership agreement. Partnerships can take various forms, such as general partnerships, limited partnerships, or limited liability partnerships, each with differing levels of liability protection for partners.
3. Corporation: A corporation is a separate legal entity from its owners (shareholders). It can own property, enter into contracts, and be liable for its own debts. Shareholders are not typically personally liable for the corporation’s obligations. Corporations can be further categorized as C corporations or S corporations, each with unique tax and ownership structures.

Question 103

Sole Proprietorship

Answer 103

A sole proprietorship is a form of business in which a single individual owns and operates the entirety of the business. It is typically established in the individual’s personal name.
o This person may have employees, may share profits with said employees
o This person is entitled to all the profits and liable for all the losses (expenses)
o If die then business dies

Advantages:
1. Simplicity: It is the simplest form of business entity, with no need to deal with shareholders or partners.
2. Independence: The sole proprietor has complete control over business decisions and operations.
3. Low Establishment Costs: It is relatively inexpensive to establish and requires minimal licensing and paperwork.

Disadvantages:
1. Individual Responsibility: The sole proprietor is solely responsible for all aspects of the business, including its debts and obligations.
2. Personal Liability: The owner is personally liable for the business’s debts and legal liabilities. (and wrong doings- torts)
3. Limited Resources: The business’s capacity for growth and access to resources may be limited as it relies solely on the owner’s financial means and expertise.
4. Continuity Issues: If the owner dies or is unable to continue the business, the business may cease to exist.

Question 104

Partnership

Answer 104

A partnership is a business structure formed when two or more individuals carry on a business together with the intention of sharing profits.

Key Features and Liabilities:
1. Joint and Several Liability: Partners in a partnership have joint and several liability. This means that if one partner engages in wrongdoing or causes harm, all partners can be held legally responsible for that partner’s actions. They can all be sued, and their personal assets may be at risk.

2. Agent Relationship: In a partnership, each partner is considered an agent for the other partners. This means that each partner has the authority to enter into contracts on behalf of the partnership, which can legally bind all partners.
3. Partnership as a Firm: Partnerships are often referred to as “firms” and can use the names of the partners or a descriptive name (e.g., “Ace Accounting”).
4. No Separate Legal Status: Partnerships do not have a separate legal status from the individual partners. In legal matters, it is the individual partners who are involved and liable.
5. Profit Sharing: Partnerships usually have an equal right to share profits. This can be a drawback because all profits are added to individual income for tax purposes, which may result in higher tax rates.
6. Continuity Issues: If a partner dies or wishes to leave the partnership, it often leads to the dissolution of the partnership.

Partnerships offer shared ownership and shared decision-making, but they come with significant legal and financial risks due to the joint and several liability of partners.

• A partnership is a very dangerous ship to sail in

Question 105

Partnership Continued

Answer 105

E.g. if partner gambler and takes from business to settle addiction- the other partners are responsible

o Partnership = no legal status – if contracting it the
individuals who are (if sued individuals are sued)

Question 106

e.g. If partner A buys land that the company was looking at, then sells it for 2 million does partner A have 2 divvy up among the other three partners?

Answer 106

yes they have to divvy it up (because a partnership is a very revered relationship, fiduciary, so if still with partnership then has to divide because he inquired knowledge of the land through the partnership
-if not established the partnership is equal; right to share equal profits, this can be a drawback because any profit made are added to income tax which can put you up a bracket (doesn’t matter if one drew out more the income tax is the same)
-if any partner dies the partnership dies with them or if one partner wants out they can declare as over

Question 107

LLP (Limited Liability Practice)

Answer 107

this protects partners only from having to pay against the negligence of another partner (recently advocated)
* Applies only to negligence, doesn’t apply to debt, or wrong doings such as Dishonesty with a Law Trust Account

Limited Liability: One of the primary features of an LLP is that partners have limited liability, similar to shareholders in a corporation. This means that individual partners are generally not personally responsible for the debts and obligations of the LLP. Their liability is limited to their investment in the partnership.
-Not personably liable for any negligence of any other partner (assets and bank accounts of the firm can be seized but can’t go after an individual partner personally- their assets, investments, pension, etc.)

• Not responsible for any debts of the firm Prior to joining, once retire still responsible for debts that occured while you were still there

Question 108

Limited Partner

Answer 108

not involved in any part of actually running the business
* Can’t participate in the business, is only limited to investing money
* No advising in business policy, no signing authority (cheques), attending meetings, etc.
* If he does do any of these things he loses his status as a limited partner
o If they do participate in any of these things and the firm issued, they are deemed as a partner
* A person who invests in the firm but does not participate in the operation (no involvement in firm)

Question 109

Partnership ends with…

Answer 109

-Death of a partner
-One partner advices that he is leaving
-Court order

□
too If

• any one of the partners die, then the partnership is considered dead

If there is any debt then the partner’s estate is responsible for the debt

Under the act each partner is deemed equal and is responsible for tax on their part unless stated in the partnership agreement

The amount drawn out is irrelevant because you will be taxed on
what percentage (%) you should have taken out as your share

• Ex. If you take out $80,000 but your share is $100,000; you will be taxes as if you took out that $100,000 rather than just the $80,000 (taxed on an extra $20,000)
• Also works in reverse, If you took out $120,000 and your share is
  worth $100,000; you would only pay taxes on the $100,000

Question 110

Partnership Agreement

Answer 110

• Can provide if one partner causes a loss or injury, then that partner will be solely responsible for the loss
• Public person have no rights under this agreement so they can sue all four partners in the partnership but then the other three partners can then sue the partner who got them sued in the first place

A partnership agreement is a legally binding contract or document that outlines the terms, conditions, and rules governing a business partnership.

A well-drafted partnership agreement is essential for the smooth and successful operation of a business partnership, as it helps partners understand their roles, protects their interests, and provides a roadmap for the partnership’s future.

Question 111

Buy-Sell Agreement

Answer 111

• Provides for the other partners to buy out any partner that wants out of the firms or dies
• If one partner dies their spouse will get their share of assets and the partnership dies
• The deceased portion can be bought out by the other partners from the spouse and split (sold) between them
  o Formula is in the agreement and made up in advance of the breakdown of the buy-sell agreement
• Life insurance ensures the buy out money in case of death of a partner, the insurance money is a tax write off for the firm
  o The partner’s take out life insurance policies on each other, therefore if one dies, they will use that money to buy out the share of the firm from the deceased partner’s spouse
  o This way the spouse still gets all the insurance money and the remaining partners get the rest of the company back at no cost

-bankruptcy: if one partner files, partnership will end

Question 112

Corporation

Answer 112

• A corporation is an artificially created person (made up of shares)
  o A separate legal entity unto itself
  o Corpus means person in latin
  o Therefore, a corporation can live longer than its owners (live indefinitely)
• No one can own a corporation, but they can own shares in the corporation
• Can’t imprison this “person”, usually fined more heavily than other business arrangements, directors can be imprisoned
• A corporation can commit criminal offences
• A corporation’s name must end in one of these options:
  o Corporation, Company Limited, Limited, Ltd., Corp., Co. Ltd., Inc., Incorporated
  o Longest corp. in Canada is The Hudson’s Bay Company (or “The Bay”)
  □ A business main objective is to create a profit
• “An establishment for making money”

its a legal business entity that is separate and distinct from its owners (shareholders). It is formed by individuals or entities who invest money by purchasing shares in the company.

When incorporate a company, do so through legislation there are provincial statutes in each province (each province will incorporate companies within the province it exists in)

Question 113

Master and Servant; 3 areas of Law:

Answer 113

□ 1) Employer → Employee
* What to do and how to do it

□ Owner → Contractor
* What to do but not how to do it (e.g. house builder)

□ Principal → Agent
* The agent represents the principal and acts in the best interest of the principal
* Legally gives agent permission to do what principal can legally do (agent can act on behalf of principle)
* e.g. lawyer, agent for actors, real estate agent (give person right to sale of home, buy property – give agent right to step into your shoes) etc.

Question 114

Called a Fiduciary Relationship (uberrima Fidei)

Answer 114

is a relationship of trust and confidence where one party (the fiduciary) is obligated to act in the best interests of another party (the beneficiary). This relationship involves a high standard of care, loyalty, and good faith. Fiduciaries must prioritize the interests of the beneficiary over their own and disclose any potential conflicts of interest
* Full disclosure when dealing with the firm (no secret profits)
* Agent must always act in the best interest of the principal
* Relationship of trust
* A partnership is a Fiduciary relationship between 2 people
* Complete unequivocal loyalty, honesty, put firm ahead of selves, no secrets

Violations of fiduciary duties can lead to legal consequences and financial liability.

-a partnership is a ‘fiduciary’ relationship

Question 115

How to incorporate

Answer 115

Start with 1) articles of association and 2) by laws

Question 116

Articles of Association

Answer 116

1. Name the corporation (concluding with the correct ending of choices corporation, company limited, inc, ltd, corp., co., etc.)
2. Choose a registered office (regularly a chartered accountant/lawyer)
3. Designate the share capital (any arbitrary figure)- this is the amount of shares that a corporation has. (used to have to have the ‘par value’).
   * Then put out the authorized share capital (how many shares you want to sell to the public)
   o E.g. 300,000 shares for $1 per share (equity financing)
4. Designate the class of shares (common/preferred). remember- common shareholders will elect who the directors will be It is the directors who will choose among themselves who will be the directors, and the directors will nominate the president.
   -Preferred shareholders get a guaranteed dividend- so they are investors who will receive a percentage of the profits in preference to the common shares. Being paid dividends- an important tax advantage (as opposed to being paid in income- taxed at ~50% less than tax to be paid.
   * Set out directors and subscribers
5. Any restrictions on the shares (ie. you may not want shareholders to compete), or restrictions on sales of shares, or a right to buy back shares. * Then set our subscribed capital (how many shares have been
   purchased from the company)
   o Total amount of shares sold
   o This won’t come into play until after the company has been incorporated
   o The share structure – common shares (no par value) and preferred shares
6. And then, the names of the parties who are incorporating a company.
   * Where the location of the head office of the company will be and where the registered office (legal documents to be served go here) will be

Question 117

Business Corporations Act (Provincial)

Answer 117

provides for creation of this “person” (entity)
o Only carry on business within that province
o Extra provincial corporation allows to register in more than one province without reincorporating

In Saskatchewan through Saskatchewan’s Business Corporations Act -if business is brought into existence provincially It will be called a provincial corporation =only entitled to carry on the business under provincial act in province in which it is incorporated (e.g. only carry business in Sask. If want to expand register under specific province legislation under the Extra Provincial Legislation (as reciprocal rights)

Question 118

Bylaws

Answer 118

• Rules that govern the corporation
• Says the corporation has ability to contract, but may or may not limit capacity
  1. Could be considered the ‘rules of the club’
  2. Sets out rules about the BOD’s (ie. how often the board meets).
  3. Think of the by-laws as the rules of the corporation.

These two sets of documents are sent to Regina with an incorporating fee- and they will send back the Certificate of Incorporation, sealed by the registrar of incorporation.

• Certificate of Incorporation – Birth certificate of the corporation
• Corporation can commit a criminal offense (no jail but a fine is levied)
• Promissory Note: I owe you, promise to pay back
• Debenture Security (floating charge): like a mortgage but stronger. Bank controls this when loans are made to insure they’re paid back.

Question 119

E.g. Ace construction Inc- has 500,000 common shares, 500,000 preferred shares. (worth nothing, despite the amount of shares- he repeats- the capital is a fiction)

There are two shareholders: A and B, each buy 1 common share (paid to the corporation). They owe the corporation nothing. But, if the two individuals want to raise $200,000 within the corporation, as equal owners?

Answer 119

Scenario 1: they both lend $100,000 and receive a ‘promissory note’. BUT, how can they guarantee their money? Promissory notes are not very protective.

Scenario 2: Have Ace Construction Inc. Provide each a ‘debenture’ security- so if anything goes wrong with the corporation- the two owners of the debentures will attach to any asset the corporation has- a debenture security acts as a priority in the case of liquidation; providing the owner to be first in line to collect on the assets in the event of business failure.

You want to build a house- and have contracted with Ace construction under ‘progress advances’, paying $100,000 based on benchmarks, equalling $600,000. You go out there after you paid the 4th $100,000, there is no workers- Ace construction is bankrupt- you go to their office- it is vacant, and there is a note on the door: ‘Ace construction inc. has ceased ops.’ You go to the land registry office- and go to search the title, and find that there are $400,000 of liens against your property from the trades people for non-payment. You go to Ace construction shareholder A, who tells you that you didn’t contract with them, you contracted with ace construction ltd., you can only sue ace construction ltd- but the debentures are paid out to the shareholders first.

Question 120

Same example with input from Chatgpt

Answer 120

Scenario 1: Promissory Notes
In this scenario, Shareholders A and B each lend $100,000 to Ace Construction Inc. and receive promissory notes.

A promissory note is essentially an acknowledgment of a debt. Ace Construction Inc. promises to repay the borrowed funds at a specified future date.

Scenario 2: Debentures
Debentures are a type of corporate debt security, typically issued by companies to raise capital. These debentures can be secured or unsecured, and in this case, they are likely secured.

Shareholders A and B receive debentures from Ace Construction Inc. These debentures provide some level of security for their investments.
If Ace Construction Inc. faces financial difficulties or goes bankrupt, the debenture holders (Shareholders A and B) have a priority claim on the company’s assets during the liquidation process. This means that they will be among the first to be repaid before other creditors, such as the tradespeople with liens against the property.

Construction Project

You’ve entered into a contract with Ace Construction Inc. to build a house, with payments based on project benchmarks.
After paying $400,000 for construction, you discover that the company has gone bankrupt, and there is a significant amount of liens against your property from the tradespeople for non-payment.

Legal Complexities

The legal intricacies in this scenario involve the distinction between “Ace Construction Inc.” and “Ace Construction Ltd.” The key issue is whether you contracted with the right legal entity.

Shareholder A suggests that you should sue “Ace Construction Ltd.” This suggests that you may have contracted with the wrong legal entity if Ace Construction Inc. and Ace Construction Ltd. are legally distinct. This could be a crucial legal point.

Shareholder A also mentioned that debentures are paid out to the shareholders first. This statement implies that in the event of liquidation, the claims of debenture holders (Shareholders A and B) would be prioritized before other creditors.

It’s important to consult with a legal professional experienced in corporate law and contract law to navigate this complex situation. They can help you determine whether you contracted with the right entity, assess your legal rights, and guide you on the best course of action to address the situation, particularly if Ace Construction Inc. and Ace Construction Ltd. are legally distinct entities. Legal counsel can provide you with personalized advice based on the specifics of your case.

Question 121

Subscribed capital

Answer 121

amount of shares the corporation sold.

Subscribed capital, also known as authorized capital or authorized shares, refers to the maximum number of shares a corporation is allowed to issue to its shareholders. It represents the total number of shares that a corporation is legally permitted to offer and sell to investors. The term “subscribed” implies that these shares are available for subscription or purchase by individuals or entities interested in becoming shareholders of the company.

Legal Limit: The concept of subscribed capital is often defined in a corporation’s articles of incorporation or articles of association. It sets a legal limit on the number of shares the company can issue, and it’s a crucial component of the company’s legal structure.

Authorized Shares: Subscribed capital is expressed in terms of the number of authorized shares or the total share capital that the company is authorized to issue. This number can vary depending on the company’s needs, legal requirements, and its future growth and expansion plans.

The shares purchased (in the above example= 2 shares)
Authorized capital: The 500,000 common shares and 500,000 preferred shares.
-This is one of the reasons why anyone getting involved with anyone in the construction industry will seek out contractors only with people who are bonded, who are ensured against losses of the company.

Question 122

Subscripted Capital Cont…

Answer 122

• Ltd. means the liability of shareholders is limited only to money they still owe for shares (meaning the investment in the corporation)
• If you hold shares in a corporation, you can sell to anyone within
  the articles and bylaws.
• In sole proprietorships and partnerships, people are personally liable; everything you own is up for grabs
• Reason why a corporation must end its name in a certain way is to forewarn the public that they are dealing with a corporation, not a person (shareholders)
• If the company is incorporated in Saskatchewan it is only licensed
  to carry business in Saskatchewan.

Limited Liability: When a company has “Ltd.” in its name, it signifies that the liability of its shareholders is limited. In other words, the personal liability of shareholders is restricted to the amount they still owe for the shares they’ve purchased. Their liability is limited to their investment in the corporation.

Transfer of Shares: Shareholders in a corporation generally have the ability to sell or transfer their shares to other parties, subject to any restrictions specified in the corporation’s articles and bylaws.

Personal Liability in Other Business Structures: In contrast to corporations, where shareholders’ personal assets are generally protected from the corporation’s liabilities, sole proprietorships and partnerships expose individuals to personal liability. In these business structures, personal assets, such as homes and savings, are at risk if the business incurs debts or legal issues.

Corporate Naming Conventions: The inclusion of “Ltd.” or other similar suffixes in a corporation’s name serves as a public notice to indicate that the entity is a corporation and not an individual or sole proprietor. It distinguishes the legal structure of the business.

Scope of Business: Corporations are typically registered and licensed to operate within specific jurisdictions or regions. If a corporation is incorporated in a particular province or state, it is generally authorized to conduct business

Question 123

Two types of Corporations:

Answer 123

Private Corporation: A private corporation is one that cannot sell its shares to the general public. Ownership is typically limited to a small group of individuals, often the founders or a select group of investors.

Public Corporation: A public corporation, on the other hand, is allowed to sell its shares to the general public. This means that its ownership is open to a broader range of investors, and shares are often traded on public stock exchanges.

Prospectus: When a corporation is going public or issuing shares to the public, it is required to prepare and provide a prospectus. A prospectus is a comprehensive document that contains the entire history and details of the public corporation. It must include important information about the company’s financial health, operations, management, and other pertinent details. Additionally, it must disclose any pending or past lawsuits or legal issues involving the corporation. The purpose of the prospectus is to provide potential investors with all the information they need to make informed investment decisions.

Question 124

Corporation’s capacity to contract

Answer 124

• A corporation has a capacity to enter into a contract, unless restricted by bylaws
• Legal, dental, and medical professions can’t incorporate
• Corporation can commit a criminal offense (no jail time, but a fine is levied)

Question 125

Relationships

Answer 125

Directors: have a fiduciary relationship to the shareholders.
Shareholders DO NOT have any fiduciary relationship to the corporation.

Question 126

There is a very important legal decision: precedent: all the way back to 1897- the case: Salomon vs Salomon

Answer 126

Still the law today: the case goes back initially to 1892- a person named Salomon, Owned a shoe manufacturing business in his own personal name: In 1892, he incorporated a company, and gave it an authorized share capital of 2007 shares. Sold 2001 shares to himself, and 1 share each to 6 members of his family (because the law then required a corporation to have 7 shareholders). Salomon then continued to operate the corp. as the sole director/employee, having sold the business to the corp. Continues to operate the shoe business under the corporate structure. The corporation didn’t have any money: Salomon lent the money to the business to buy his shoe business, loaning it as a security debenture. The business fails, (labour problems), creditors were not being paid, and the creditors turn to Salomon for payment. Salomon refuses to pay the creditors back anything, they sue him personally, claiming that the whole setup is a ‘sham’, because Salomon had first claim on all the assets- The decision of the court was: a) the corporation is a second legal entity. B) The debts are the debt of the corporation. C) Salomon was ahead of the creditors because of his security debenture.

-The case, Salomon vs. Salomon establishes 1) that the corp. is a separate legal entity. 2) limited liability of the shareholders. This decision holds to today.
-Therefore, the reason a corporation must have as part of it’s name: corporation, Company limited, co.ltd, ltd, incorporated, inc. to warn creditors/consumers that they are dealing with a corporation, and not an individual.

Question 127

Therefore: What is the capacity of the corporation to contract:

Answer 127

full capacity to contract as an individual person, unless limited or restricted by the ‘articles of association’ or it’s ‘by-laws’.

What if a corporation commits a crime? If a corporation is found guilty of a criminal offence, the fine is very large, as you can’t put a corporation in jail.
If a director is found guilty of a crime, ie, fraud- they will be tried as an individual.

Question 128

Corporation advantages

Answer 128

1) Limited liability of it’s shareholders
2) Flexibility of a corporation- shareholders can change/sell their shares. In public corporations directors rarely know who the shareholders are.
3) Does not die. The shares are just distributed in alignment with the shareholders agreement in the event of a death of a shareholder.
4) Run by many persons (BOD- who appoint the executive level)
5) Can be suitable for large numbers of investors
6) Sale of shares is simple.
7) Can be dissolved, but cannot be done as easily as a partnership.
8) While it’s true that ‘majority rules’, the minority is not ‘oppressed’, because if they feel they are being taken advantage of, they can apply to the court for relief.
9) Regarding income tax- because it’s an entity unto itself, it is taxed. There is a double tax- as the corp is taxed as a taxable entity (1st as a corporation, then by way of dividends- which are also taxed).
10) Because the corporation is essentially doubly taxes, the rate is usually low as compared to individual tax, and dividends are taxed lower.
11) Another tax advantage; if you have substantial income from a source within the corporation, you can keep it in, or take it out when you please.
12) The corporation can hire the entire family- (wife, kids etc) which can lessen the income to a number of people.
13) There is no fiduciary relationship of the shareholders

Question 129

Corporation disadvantages

Answer 129

1) Minority shareholders have a weaker position.
2) Number of shares is limited to articles of association/by-laws.
3) It’s more expensive to incorporate.

Question 130

Partnership disadvantages

Answer 130

Disadvantages
1) Joint and several personal liability
2) Personal.
3) If a partner dies, bankruptcy, or if a partner simply declares the partnership over: The partnership dies.
4) Any partner can bind the partnership into a contract.
5) Not suitable for outside investment (there is a provision for limited partners)
6) With no clear ‘buy sell’ agreement, a partner cannot just leave the partnership.
7) Regardless of the amount drawn out: you are taxed on what you are entitled to as being your share of the profits.
8) There is a strong fiduciary relationship between the partners.

Advantages:
1) Cheaper.

Answer 131

Partnership corporation
Separate legal entity No Yes
Ease of transfer of ownership:No yes
Fiduciary responsibility Yes no
Continuity of business No yes
Taxable entity No yes

Question 132

Corporation recap

Answer 132

Limited Liability: Shareholders’ liability is generally limited to the amount they invested in the corporation. Personal assets are protected from the corporation’s debts and liabilities.

Separate Legal Entity: A corporation is considered a legal person, separate from its shareholders. It can enter into contracts, own property, and sue or be sued in its own name.

Perpetual Existence: A corporation can exist indefinitely, even if shareholders change, die, or transfer their shares.

Transferability of Shares: Shares of stock can typically be bought, sold, or transferred without affecting the corporation’s existence.

Ease of Capital Raising: Corporations can raise capital by selling shares to a large number of investors. They can also issue different classes of stock with varying rights.

Centralized Management: Corporations have a centralized management structure with a board of directors, officers (e.g., CEO, CFO), and shareholders who elect directors.

Double Taxation: Corporations are subject to double taxation, where profits are taxed at the corporate level, and then dividends distributed to shareholders are taxed as personal income.

Regulatory Compliance: Corporations are subject to various regulations, reporting requirements, and governance rules that vary by jurisdiction.

Ownership Transfer: Ownership can be transferred easily through the sale of shares without affecting the company’s operations.

Question 133

The difference between private and public corporations.

Answer 133

A public corporation can sell it’s shares to the public, provided it produces a ‘prospectus’, for extreme due diligence of the corporation is studied- every aspect of the corporation must be examined, including it’s obligations, possible law suits, any liabilities, and etc. everything is put forth in the prospectus. In CDA it must also be translated to the French language.

Question 134

2) Mutual Agreement (element)

Answer 134

Must have:
1. Offer – in order for it to be binding it must be definite (for formal documents “I hereby offer…”)
2. Acceptance (4 requirements)
o Unconditional (conditional acceptance = counter offer, which destroys/voids the original offer)
o Communicated
o Manner required
o Time period required

An offer, in law, must be ‘definite’.
An acceptance, in law, must be unconditional, communicated, made in the time and manner required by the offer.
All the above elements must be present within the facts- regardless of how the facts are presented.

Question 135

How to determine if the offer is ‘definite’.

Answer 135

• Price tag on a garment is an invitation to treat (price tag is not an offer)
  o Consumer offers and store either accepts or rejects the offer
  o Ex. Store selling coat can reject or accept the right the right to sell an individual a coat
  o The consumer is always the one that makes the offer
• Only have to sell if it is a contractual agreement

a price tag is not an offer by the store, what it means is: you are invited to make an offer- ‘an invitation to treat’** When you present your $200, you are providing an offer to purchase the product. The consumer makes the offer, the seller accepts the offer.

Question 136

Unconditional Acceptance

Answer 136

One which does not change any terms of offer

Unconditional acceptance: one which does not in any material way change any of the terms of the offer. Ex. Conditional acceptance: Offerer ‘I hereby offer you a job in my office in regina’ and the offeree: ‘I accept, but on the condition that it is in saskatoon’ = ‘COUNTER OFFER’. (rejection= no offer, no acceptance). there are no legal requirements for the offer to be accepted, a counter-offer voids any previous offer

Unconditional acceptance: Offerer: ‘I hereby offer you a job in my office in Regina’ and the Offeree says: ‘I accept’- this is an unconditional acceptance.

Unconditional acceptance will only occur once all conditions are met between the two parties.

Question 137

Conditional Acceptance

Answer 137

Any change to the terms of the offer (counter offer or counter proposal) – not acceptance
o A counter offer destroys the previous offer
o Can accept the counter offer so have become the person making the offer called the offeror
* If change mind and comes back and says will take the first offer there is no agreement or acceptance of offer because the counter offer voids the first offer
o Better to ask the person to modify the offer rather than make a counter offer, which will void the previous offer
* Acceptance has to be communicated to the person that makes the offer (if no stimulation stated about acceptance than must be in the same form the offer was made
o E.g. send a letter in confirmation

□ ** An offer can be withdrawn at any time before it is accepted. An offer once accepted cannot be withdrawn (if try to withdraw can be a breach of contract)

Communicated: Acceptance must be communicated to the person who makes the offer.

Question 138

EXAMPLE: Farmer A owns land and offers to “sell the land for
$300,000 by Feb. 1/13” (to farmer B in writing), possession would be Sept. 1/13, offer open for acceptance until April 30/13, offer irrevocable by me (this is meaningless in law)”

Answer 138

But by law it can be revoked

□ Farmer A attempts to revoke offer but Farmer B says he cannot

□ RESULT: By law Farmer A can revoke offer because it has not been accepted yet, words like irrevocable are meaningless in this situation
□ Instead he should ask Farmer A to enter into a contract called an option to purchase, in which Farmer A gives exclusive right to purchase the land in return for $5000 up front

Question 139

EXAMPLE: Jones MFG Inc. in Saskatoon (manufacturers of goods) – has $100,000 of goods – sends letter to offer goods to Brown MFG Regina (sent out June 1/05)

Answer 139

• Brown MFG receives offer June 2, 5:10pm, offer unconditional
  acceptance – arrives June 3, 10am, at Jones MFG
• Problem: on June 2 at 1pm, Brown in Winnipeg phones Jones and makes a deal to buy goods, Brown electronically transfers to Jones and Jones ships the goods out
• Jones sends a telegram out at 2:30pm to Brown MFG Regina
  arriving at 5:20pm on June 2 withdrawing the offer
• But Brown Regina put letter in mail before receiving the offer withdrawal
• Mad Brown Regina (plaintiff) sues Jones (defendant)

□ Result: Plaintiff wins because they had a contract

□ Reasons:
* An offer can be withdrawn at any time before it is accepted
* An offer once accepted cannot be withdrawn (offering standing by itself is meaningless until it is accepted)

Question 140

An illustration: Farmer A (F/A) and farmer B (F/B).

Answer 140

On May1/21- F/B offers F/B land in exchange for $2,000,000. He states: I will leave the offer open for your acceptance up until August 31, 2021- puts it in writing- states it cannot be revoked- and signs it in the presence of 2 witnesses.

June 1, 2021: F/B goes to F/A: indicates that the offer has been withdrawn. F/A- states that it’s not right, because of the agreement of an irrevocable offer- threatens to sue F/B for breach of contract. But because there was no ‘Option to purchase’- which acts as an ‘exclusive right to purchase the land’ in exchange for payment. This is a very common contractual relationship in the business world. The difference between the two scenarios is the first one did not have the agreement for the ‘exclusive right to buy the land’. Options to purchase can also be sold as ‘An assignment of an agreement for sale’ and are often used by investors to sell to contractors building high rises.

Question 141

Another illustration:

Answer 141

A Manufacturing Corporation, Saskatoon, has 1 truck load of goods available for sale, wants $100,000 for: makes an offer to Z corporation to sell the truckload of goods for $100,000 on May 1, 23- Z.Corp receives the letter at 10 am on May 2nd, 2023- Manager is very happy with the offer as the same goods they were about to buy were $125,000. They write an acceptance letter, sends it in the mail on May 2, 2023 at 5:02 pm. The letter arrives back at A Manufacturing Corporation on May 3rd, 2023. However, at 10 Am on May 2nd, 2023- W corporation contacts A Manufacturing Corporation regarding their product and agree to pay $100,000. The goods are now on their way to W Corporation. A Manufacturing Corporation emails Z Corporation in Regina at 5:10 pm entitled ‘offer withdrawn’. The email arrives at 5:10, May 2nd.

Z Corporation is now suing A Manufacturing Corporation for breach of contract. It was unconditionally accepted: BUT, was the acceptance communicated? If there was no time specified, how much time does one have to accept the offer? A ‘reasonable’ time. (in the above scenario: yes). If the manner of the response: if the offer was made by letter, the response would be made by letter. A prudent business person would call. The post office is the ‘agent of the addressee’ (the person receiving the letter). Therefore, yes, there is a communicated acceptance- as a ‘long arm of the addressee’. Therefore it doesn’t matter that the letter doesn’t get communicated in the same day, even that it gets lost, it has still been communicated. From this example: ‘The Postal Acceptance Rule’: Communication of acceptance takes place the moment a letter is posted. That is the only rule they take (you cannot withdraw the offer through the mail, the only time this works is in the event of acceptance). To prove that the acceptance was in the mail when it was is a matter of evidence.

Question 142

Postal Acceptance Rule

Answer 142

communication of acceptance takes place the moment a letter is posted.
* Revocation (withdrawal of offer) – on arrival of telegram, which arrived at 5:20pm, which was after the letter was sent (post acceptance rule) of acceptance 5:10pm
* Personal Information Privacy and Electronic Document Act – If you
designate the electronic method and I use that method and it enters the system and you are capable of retrieving and procuring it then you’re and in acceptance of the offer. If you did not designate the offer then you become aware of the offer or acceptance once you retrieve it
* Acceptance must be made in the same manner required by the offer
* If no manner is stipulated, law requires you to accept in the same manner in which the offer was made
o Manner meaning the mode of communication
* Acceptance must be made in a certain time period (set out by offeror)
o If no time period is stipulated, then you have a “reasonable” period of time in which to accept (dependent on the situation)

Question 143

3) Genuine Intentions (element)

Answer 143

The 5 items that void genuine intention (any one or more):
□ Fraud
□ Misrepresentation
□ Duress
□ Undue Influence
□ Mistake

Question 144

a. Fraud

Answer 144

• A false representation of material facts made with knowledge of its falsity. (3 criteria-need all 3 for fraud)
  o Have to find 3 criteria (to know its false, b/c false rep, of material fact, with knowledge-true representation or false)
  o Representation can be made through silence (ex. Dresdine china example- false representation b/c didn’t say anything, true representation if stayed silence and it was dresdine china)  not fraud b/c has to be material fact (material facts induces you to enter a contract)
  o Not every false representation is a material fact
  o Intention/Knowledge so IMPORTANT
• malum perse – “bad within itself”
• False representation: any representation which is not true, no matter how the representation comes about
  o This is a civil wrong that voids a contract
  o Representation can be stated or implied (by conduct of the parties)
  o Can have representation without saying anything (i.e. not answering questions or indirectly avoiding questions)
• uberrima Fidel (Utmost faith) – one is obligated to disclose everything they know about something, even if you’re told you don’t need to say anything
• Prospectus: free disclosure by a company of all its financial assets
  and obligations (this is a form of uberrima Fidel)
• Material fact: the very representation that induces one to enter into a contract (if not for that representation, you probably would not have purchased it)

Question 145

Fraud is a legal concept that typically requires the presence of three key criteria for it to be established. These criteria are as follows:

Answer 145

1. Misrepresentation: The first element of fraud involves a false representation of material facts. This means that someone, in the context of a contract or transaction, makes a statement, claim, or representation that is not accurate or is intentionally misleading.
2. Knowledge of Falsity: The second element of fraud requires that the person making the false representation has knowledge of its falsity. In other words, they are aware that the information they are presenting is untrue or misleading. This element implies that the misrepresentation is not an innocent mistake or oversight.
3. Intent to Deceive: The third and crucial element of fraud is the intent to deceive. To establish fraud, it must be proven that the person making the false representation intended to deceive or defraud the other party. In other words, there must be an intention to induce the other party to act in a certain way, typically to their detriment, based on the false information.

Meeting all three of these criteria is necessary to establish a claim of fraud in legal proceedings. If any one of these elements is not present, a claim of fraud may not succeed in a court of law.

Question 146

With knowledge

Answer 146

Most important word in criminal law
* Mens Rea (“mental thing”) – intention to commit act (guilty mind)
o Essential ingredient for criminal law (can’t have criminal law without
mens rea – exception is manslaughter)
o Knowledge, intention to deceive
o Law doesn’t look at the result, but at your conduct
o Both civil and criminal law
o Cannot commit murder, arson, steal (any wrongdoing) without Mens Rea
o Fraud is not only against civil law but criminal

Question 147

b. Misrepresentation

Answer 147

• A false representation of material fact without knowledge of its falsity (no Mens Rea)
• It is not a criminal wrong – lack of Mens Rea
  It is civil- still void contract but no criminal element
• Example: If you write a cheques and you know it will be no good but plan to pay your account your account before the check
• Post-dated cheques is a misrepresentation – not fraudulent
• Trade puffing (legal term) – the right to exaggerate about service or merchandise (bullshit)
  o Allowed because a reasonable person would know it to be untrue
  o If trade puffing over into misrepresentation or fraud then that’s what it is
  o E.g. “Best place in town”, “We won’t be undersold”, “Satisfaction guaranteed”
  o Word “cure” will never be used
• In the previous examples with the cars, the purchase from Alex to Ben is considered Fraud, but the purchase from Ben to Carl is a misrepresentation because there wasn’t knowledge of its falsity

Misrepresentation is a legal concept that involves providing false or misleading information, whether intentionally or unintentionally, during a transaction or contract formation. It can occur in various contexts, including business transactions, contracts, insurance, and more.

Question 148

Misrepresentation Example

Answer 148

• E.g. bought house that was 12,000sqft (go to do renos) – find out its only 11,000sqft can sue for misrepresentation or is fraud? –yes misrepresentation –no fraud claim b/c no material fact (too late in the game – express its material at the time of the contract- no evidence it is what it induced you to sign the contract) false rep made now civil law

-go back to when bought it, what induced you at the time to buy it (bedrooms, view, area, etc.)

• When c bought car but made clear that milage was material fact (was it inducing you to buy the car -put in writing that it is a material fact if want to claim fraud

-can have multiple material facts (whatever induces you/influences you to enter into a contract)

Question 149

c. Duress

Answer 149

• The treat of actual physical violence or threat of actual physical violence to a direct person. (e.g. holds gun to you to sign)-elimniates genuineness to sign
• The person only intended to contract because of the threat, therefore it is not genuine

Question 150

Duress Cont…

Answer 150

Duress is a legal concept that involves one party coercing or forcing another party into an agreement or contract against their will. It can render the agreement voidable, meaning the victim of duress has the option to void the contract. Duress may take various forms, including physical threats, economic pressure, or psychological coercion.

There are two primary types of duress in contract law:

Physical Duress: This occurs when one party uses physical threats or actual physical force to induce another party to enter into a contract. For example, someone might physically threaten to harm another person unless they agree to a contract.

Economic Duress: Economic duress involves the use of financial or economic pressure to compel someone to enter into a contract. This may include threats to terminate an existing contract, withhold payment, or engage in other financially harmful actions unless the victim agrees to a new contract.

To prove duress in a legal context, a person typically needs to demonstrate the following elements:

There was a threat or coercion, which may include threats of physical harm, economic harm, or other forms of coercion.
The threat was unlawful or wrongful.
The victim had no reasonable alternative but to enter into the contract.
The contract was entered into due to the threats or coercion.

Question 151

d. Undue Influence

Answer 151

• The inappropriate/improper and unconscientious use of an influence or power possessed by one person over another person due to/because of their relationship or circumstances. It is presumed to exist when alleged in the following relationships:
  o Parent – contracting with own child
  o Teacher – contracting with own student
  o Lawyer – with client
  o Doctor - with patient
  o Etc. any professions that contracts with own clients/patients/students/customer, etc. (architect, accountant)
  o In all other relationships the onus of proof rests upon he who alleges
• Client doesn’t need to prove undue influence. By claiming it, it is alleged to be true and exists. This occurs for all professional relationships. Onus is on the other to prove it doesn’t exist
• E.g. doctor suggests farmer to sell farm b/c of health, doc buys it- farmer feels he pushed this/unjust - onus befall doctor
  □

Question 152

Influence Cont…

Answer 152

Undue influence is a legal doctrine that deals with situations where one person exerts improper or unfair pressure on another person to influence their decision-making, often leading to the weaker party entering into a contract or agreement against their will or interests. This doctrine is intended to protect individuals from being taken advantage of in situations where they are vulnerable or subject to manipulation.

Undue influence typically involves one party taking advantage of a position of trust and confidence over the other party. This can manifest in various ways, including:

Confidential or Fiduciary Relationship: The stronger party may have a legal or ethical duty to protect the interests of the weaker party. For example, an attorney-client relationship, doctor-patient relationship, or a trustee’s relationship with a beneficiary.

Moral, Emotional, or Psychological Pressure: The stronger party may use emotional or psychological manipulation to influence the weaker party. This can include emotional blackmail, psychological coercion, or taking advantage of the other party’s trust or dependence.

Disparity in Power or Knowledge: When there is a significant difference in power, knowledge, or experience between the parties, the stronger party can exert undue influence over the weaker party. This can happen in business relationships or family situations.

Undue influence can render a contract or agreement voidable. To prove undue influence in a legal context, the following elements are typically considered:

The existence of a confidential or fiduciary relationship or some form of trust between the parties.
Evidence that the stronger party exerted influence over the weaker party’s decision-making.
Proof that the influence was unfair, excessive, or improper.
A showing that the weaker party was pressured or coerced into the contract or agreement.

Question 153

e. Mistake -void genuniness
Three Types of Mistakes:

Answer 153

1. • Existence of the subject matter
     o Both parties are mistaken of the existence of the subject matter
     o Subject matter – anything that is being exchanged in the contract
     o E.g. A car is sold at a dealership (through contract), neither party knows that the car burned in the lot an hour ago. At the time of contract, both parties were unaware that the subject matter no longer existed contract is void for lack of genuie intention
2. • Identity of the subject matter
     o Consensus ad idem – “of one mind” (meeting of minds) – not of one mind – no consensus ad idem
     o E.g. A buyer thinks he is buying
3. • Identity of the contracting parties
     o E.g. Carl enters into a contract with Ben, but thinks he is getting into a contract with Alex.
     o Carl is not obligated to either Ben or Alex
     o Ben tries to sue Carl but Carl does not get sued because there is an identity of contracting partners
     o Mistake as to identify contracting parties= void

Non Est Factum it is not my doing
-if doc Infront of you and you know what’s in it – you are responsible -If contract (can’t say didn’t read or understand)
-if doc in front of you and in no way related to what you thought it was/not aware of nature its about can plead “non est factum” ‘
-e.g. small print of rental car – have one glass of wine-have voided all insurance (know your legal position before making any steps)

Question 154

4) Legal Consideration

Answer 154

That what a person receives (present) or is to receive (future) for what he does (present) or agree to do (future).
* Has to be an exchange, doesn’t include donations or gratuitous promises
* In the eyes of the law, must exchange something of value

□ In order for legal consideration to be sufficient, it must be in the present/future, no past.
* Emotional consideration is also considered insufficient because it has no value
* Valuable –>Sufficient
o A consideration must be sufficient to be legal consideration.
* Past Emotion –> Insufficient
o Not classified as a legal consideration
o Past consideration has no value

Question 155

EXAMPLE

Answer 155

• January 1/05: You agree to give the University $25,000 to do what they want with it (gratuitous promise)
• The president of the university accepts the offer (mutual agreement)
• The university then sends you a letter about the money you offered, and they accepted and if you do not pay them, they will sue you

-not getting anything in return (contract requires more than offer + acceptance)

• Conclusion: You are not legally bond because there is no contract

Question 156

Gratuitous Promise

Answer 156

• Legal consideration is insufficient (not legally enforceable by law)
• Ethically owe something but legally you don’t.
• If I donate money (promise) and get a promise to furnish a room in your name then it will bind the contract
• Exception: If you offer an institution a substantial amount of money and construction begins then it is enforceable and considered a contract. (has to be substantial amount of money and start building/doing what money intended to support comenses)
  o It must be substantial and they must act on it

□ -promise for a promise = (valuable consideration- for consideration to have value to it must be sufficient) no value = insufficient

Legal consideration, in essence, is the exchange of something of value between the parties involved in a contract. It involves what one person receives or is to receive for what they do or agree to do, and it’s a fundamental element that distinguishes a contract from a mere gratuitous promise.

Question 157

2 Types of Consideration

Answer 157

1. Sufficient Consideration – Valuable contract (promise for a promise)
   □ A consideration must be sufficient to be a legal consideration

EXAMPLE:
* October 1/04 – A farmer will sell his farm to his son for $10, the son agrees to buy on May 1/05
* May 1/05 – Farmer and son have a falling out. Son comes with $10 and the farmer says he is not going to sell his land to him
* Conclusion: The son has a contract with the father and it is legal

Father promised son farm for $10, son promised to pay $10 on may 1 (son has an enforceable contract)
-its what in the eyes of the law has value to it – promise for promise always have value, promise do something in exchange for money has value, promise of service for money (plumber) -have value
-inorder for consideration must be what will receive now/or will get in future and what doing now/in future
-consideration must be present or future –> never past

Question 158

2. Insufficient Consideration

Answer 158

Not classified as legal consideration
□ Never past consideration (emotional value = nothing)
□ Past consideration has no value

EXAMPLE (PAST CONSIDERSTION)
* Sept 1/16: You are building a house costing $400,000
* You want the house ready by Dec 1/16
* The contractor says the house will be ready
* Nov1/16: not a lot of progress is made, contractor says the house won’t be ready till Feb1/17
* You say to contractor to “do whatever you have to, to get the house ready by Dec 1/16”.
* You move into the house and pay the $400,000
* The contractor wants the $10,000.

• Conclusion: You are not obligated to pay the $10,000 because you are not getting anything extra that you were originally.

□ If entitled to something in the past, then you do not have a contract for the new money.
□ E.g. neighbor helping you out for a month with renos, promise to pay him after for all this hard work at end of month- don’t pay –its in past not legally have to pay

Question 159

Signed, Sealed and Delivered

Answer 159

□ Witness A
□ Witness B

□ In witness where of the parties have here unto set their hands and seals the dot of a seal.

• Signed – Means hand signature
• Delivered – Both parties got a copy of the document
• Sealed – A seal on legal document presumes the existence of the elements of legal considerations
  o When signing something under a seal, you are agreeing that you have had sufficient consideration.
  o Only time that the court goes behind the seal is if there is fraud.
  o A document under seal is the highest form of contract.
  o Ex. U of s example -if under seal obligated to pay $25,000

The phrase “signed, sealed, and delivered” is often used to describe the finalization or completion of a legal document or contract. Here’s what each part of the phrase typically means:

Signed: This signifies that the document has been physically signed by the parties involved, indicating their consent and agreement to the terms and conditions laid out in the document.

Sealed: Historically, a seal was a physical mark or emblem that was affixed to a document to provide a formal indication of its authenticity. In modern times, the term “sealed” may refer to the use of an official seal or stamp, or it can simply signify that the document has been executed with a higher level of formality and seriousness.

Delivered: This means that the document has been presented, handed over, or transmitted to the other party, signifying that it is now in their possession and legally binding.

When a document is “signed, sealed, and delivered,” it is typically considered a legally enforceable contract, and all parties involved are bound by its terms. This phrase is often used in the context of business contracts, legal agreements, deeds, and other important documents.

Question 160

Formal Contract

Answer 160

– In writing under seal (only type of formal contract)
□ -contract signed under seal=formal contract
□ -currently sealed with red waiver- in past sealed with wax seal- aritsocrats add stamp/embedding of fam ring

A formal contract is a legally binding agreement that is typically documented in a formal, structured manner. It is characterized by several key features:

Writing: Formal contracts are usually in writing to ensure clarity and provide a record of the agreement. This is in contrast to verbal or oral contracts, which may be more difficult to enforce because they lack a written record.

Formality: These contracts often include formal language and provisions, which may be drafted or reviewed by legal professionals. They may also be executed with specific formalities, such as the use of a seal or notarization.

Signatures: All parties involved in the contract typically sign it, indicating their consent and agreement to the terms. Signatures are essential to establish the identities of the parties and their intent to be legally bound by the contract.

Consideration: A formal contract requires something of value, known as consideration, to be exchanged between the parties. Consideration ensures that the contract is not a one-sided promise but a mutually beneficial agreement.

Legally Enforceable: Formal contracts are legally enforceable in a court of law. If one party fails to fulfill its obligations, the other party can seek legal remedies.

Specific Terms and Conditions: The terms and conditions of a formal contract are typically detailed and specific. They outline the rights and responsibilities of each party, including obligations, timeframes, payment terms, and dispute resolution mechanisms.

Examples of formal contracts include real estate deeds, wills, employment contracts, purchase agreements, and business partnership agreements. These contracts are often used in situations where the parties want a higher level of legal protection and formality.

It’s essential to consult with legal professionals when drafting or entering into formal contracts to ensure that they meet the legal requirements and serve the interests of all parties involved.

Question 161

Simple Contract

Answer 161

All other contracts
□ (Indenture = Agreement)
□ Parol (oral) contract – Spoken contract
□ Express contract – Written non-sealed contract—in writing but not under seal (exchange of letters)

Don’t let insurance company know have lung cancer, or are a smoker – with holding material facts

Fiduciary relationship with partner ship

A simple contract, also known as an informal contract, is a legally binding agreement between two or more parties. Unlike formal contracts, simple contracts are less structured and do not require the same level of formality. Here are some key characteristics of simple contracts:

Verbal or Written: Simple contracts can be either verbal or in writing. Verbal contracts are based on spoken agreements, while written contracts are documented in a written form.

Less Formal Language: Simple contracts typically use plain and everyday language. They do not require complex legal terminology or formal language.

Consideration: Like formal contracts, simple contracts require consideration. Consideration is something of value exchanged between the parties, demonstrating mutual obligation. It can be money, goods, services, or anything that holds value.

Legally Binding: Simple contracts are legally binding and enforceable in a court of law. If one party fails to fulfill its obligations as specified in the contract, the other party can seek legal remedies.

Parties’ Intent: The parties involved in a simple contract must intend to create legal relations. If it is clear that the parties did not intend to create a legally binding agreement, the contract may not be enforceable.

Specific Terms and Conditions: While simple contracts are less formal, they should still contain clear and specific terms and conditions. These terms outline the rights and responsibilities of each party, including details about the agreement’s subject matter, timeframes, payment terms, and dispute resolution.

Examples of simple contracts include agreements for the sale of personal property, lease agreements, employment contracts (especially those without complex terms), and everyday agreements, such as buying goods from a store.

It’s important to note that, while simple contracts can be either verbal or written, having a written contract is often recommended because it provides a clear record of the agreement’s terms. If a dispute arises, a written contract can serve as valuable evidence in court. However, the enforceability of verbal contracts varies by jurisdiction and the specific terms of the agreement. To avoid potential issues, it’s generally advisable to create a written record of agreements, even when the formality is low.

Question 162

5) Lawful Subject Matter

Answer 162

“He who comes into court, must come with clean hands”

“Lawful subject matter” in contract law refers to the requirement that the object or purpose of a contract must be legal. This means that the parties involved in a contract cannot create an agreement that involves actions or purposes that are illegal or contrary to public policy. Contracts that involve unlawful subject matter are generally considered void and unenforceable by a court.

Question 163

i. To commit a crime

Answer 163

• Any subject matter to commit a crime is not enforceable
  o Using criminal force as a threat is unlawful (you stole from me so you must pay everything back or I will call the police)
• Any gambling, wagering contract is illegal
• You cannot sell raffle tickets that go towards your house or car because these are “not in the public good” (gaming contacts-casino, sport games, etc.) has to go to public interest or charity
  o You may only gamble (raffling) if it is for charitable purposes
• One type of betting contract that we are all encourages to enter:
  Insurance (is a gaming contract)
  o You are basically betting that you will die within a certain time
  o They will win more than you lose
  o Insurance company is betting he will live, person buying betting they will die – protection from potential loss – need insurable interest (can show you will suffer a loss if that person should die)

Question 164

ii. To commit a civil wrong

Answer 164

• Lords Day Act – sometimes called Sunday legislation
  o Both a federal and provincial Lord’s Day Act
  o Contract for a sale of land on Sunday is illegal, also the sale of cars and homes (malum prohibitum – “bad because law says so”)
  ▪ Malum perse – “bad within itself” (e.g. murder, rape,
  etc.)

Question 165

iii. Against public policy (not in public interest to enforce the contract)

Answer 165

Contracts:
□ A. in obstruction of justice (e.g. bribery contract)
* “if you make a reduction in charge for man slaughter, I will give you $25,000”
* Offer of reward to persecutor is obstruction of justice – bribe

□ B. in obstruction of civil service
* e.g. rewards for choosing your business instead of others

-ministry of highways proposed a grid road – say you’ll company will pay extra to get contract -bribery

□ C. in promotion of litigation
* Champerty – investing in someone else’s lawsuit and in return you get part of the compensation
* Maintenance – person doesn’t want to proceed in court proceedings. You promise to pay person to keep up the proceedings

□ D. in restraint of marriage
* e.g. offer to pay groom $25k not to marry bride (not enforceable by law)
* if father says to perspective groom offers $25K make deal, breaks off – won’t pay—he can’t sue (not enforceable at law)
-wagering contracts- not in public contracts

□ E. immoral content (immoral subject matter)
* A contract whose subject matter is immoral is not enforceable (this is why prostitutes collect in advance)- unlawful (soliciting for prostitution is illegal – not prostitution itself in criminal code) e.g. story of the fee of $1
* A person who promises to pay for sex, does not have to pay after

□ F. in restraint of trade (most important for us)-important in business world
* A contract may be legal but any clause that restraints trade is not enforceable by law
* A clause in a contract in general restraint of trade is unlawful, however a clause in a contract in limit or partial restraint of trade is lawful if… IF it is reasonable to enforce it
* If you agree you won’t work anywhere= general restraint of trade
* limited restraint of trade – is it reasonable to enforce it (depends on the facts of each case) e.g. dentist example – we all have right to earn a living (on far side of city not enforced bc far enough away)
* employee contracts -won’t work within 25mile radius of city in field

G. Enemy Alien

Have set of facts –> contract (5 elements are present) –> writing and enforceability at law
OR –>no contact |stops

i) Price fixing -has been proven to reduce competition
-Gaming/gambling contracts -are unlawful
-Unlicensed contractor – contact unlawful

Question 166

Statute of frauds 1677

Answer 166

(adopted by Canada)- if fall within the statute is must be in writing

□ All contracts which are not to be or cannot be completed within ONE YEAR of its date (look to date when the contract was made)

□ “Not to be” because all contracts don’t have an end date

**Always look at the date

□ The contract falls inside the statute if it is OVER a year and it falls outside if the agreement has not been completed under a year

□ All contracts for the sale of land or an interest in land

□ All contracts with the sale of land must be in writing because it is the EVIDENCE of the contract

□ All contracts wherein an executor or administrator if an estate agrees to be personally responsible for the debts of the estate

□ All contract in promotion of marriage

□ All contracts whereas one person agrees to be responsible for the debt OR default of another

Question 167

Statute of frauds 1677

Answer 167

The Statute of Frauds typically covers the following types of contracts:

1. Contracts Involving Real Property: Any contract for the sale or transfer of an interest in real property (land, real estate) must be in writing. This includes agreements for the sale of land, leases with a duration of one year or longer, and mortgages.
2. Contracts That Cannot Be Performed Within One Year: If the terms of the contract cannot be fully performed within one year from the date the contract is made, it must be in writing. This rule applies even if the actual performance may take less than a year but is not capable of being completed within a year.
3. Contracts for the Sale of Goods: In some jurisdictions, contracts for the sale of goods valued at $500 or more typically need to be in writing to be enforceable. This is a requirement under the Uniform Commercial Code (UCC) in the United States.
4. Contracts for the Sale of Securities: Some securities transactions may need to be in writing to comply with the Statute of Frauds, especially for larger transactions.
5. Surety Agreements: Promises to pay the debt of another, such as guaranties and surety bonds, are often required to be in writing.
6. Marriage Contracts: Prenuptial agreements, which detail the division of assets and liabilities in the event of divorce or death, are often required to be in writing.
7. Executors’ Promises: Agreements made by executors or administrators of estates to use their own money to pay the debts of the deceased are generally required to be in writing.
8. Contracts Covered by Other Statutes: Various other contracts and agreements specified by other statutes may also fall under the Statute of Frauds.

To satisfy the Statute of Frauds, a written agreement typically needs to include the essential terms of the contract and be signed by the parties to be charged with the obligation. However, the specific requirements may vary by jurisdiction, so it’s essential to consult the laws applicable to the relevant jurisdiction.

It’s worth noting that the requirements of the Statute of Frauds do not mean that an oral contract is completely unenforceable in all cases. They may still be valid for certain purposes, such as a basis for reliance or other equitable remedies, but they may not be enforceable as a standard contract in a court of law. To ensure enforceability and legal protection, it’s generally advisable to put important agreements in writing when the Statute of Frauds applies.

Question 168

1) All contracts which are not to be or cannot be completed within 1 year of its date

Answer 168

□ Must be in writing – falls inside the statute
□ Always from the date of acceptance of the contract

EXAMPLE:
□ Feb 1/12 – Employer in Vancouver offers you a position in a firm with a salary of $5000/month, various allowances (car, holiday, etc.), starting date is May 1/12
□ Employer offers employment guarantee until April 30/13 to accept the
offer (employee is worried about leaving Saskatoon to go to a new city to work), so employee accepts the offer
□ On December 1/12 he calls into the employer office and finds out that
he is let go due to a downturn in the economy. They offer to pay you until Jan 1/13 or stay with them for 2 months until you find a new job
□ Employee says to employer that he was guaranteed employment until
April 30/13 so he wants to be paid until April 30/13
□ Do we have an enforceable contract?

□ A: No, contract falls inside the statute, so it has to be in writing. It falls inside the statute because it is longer than one year (this contract is approx. 14 months) and therefore needs to be in writing

Question 169

EXAMPLE: All the same details as above but offer is made on April 1/12 and you start on May 1/12 and work is guaranteed until March 31/13.
□ December 1/12 – get a call from the office saying you are laid off and they will pay you until Jan 1/13
□ You say you are guaranteed until March 31 and should be paid until then
□ Is there an enforceable contract here?

Answer 169

A: Yes, this contract falls outside the statute (because it is less than one year – approx. 11 months) and therefore does not have to be written. So the employee must be paid until March 31/13
□

Question 170

EXAMPLE: There are times when the end date is not in sight (i.e. not until death)
□ Husband and wife decide to separate on March 1/15. The husband says (verbal contract) that he will pay her $1000 on the first day of every month as long as he shall live
□ Payment in consideration in your agreement not to sue me or go to
court (settlement offer)
□ On October 25/15, he says he will not pay anymore
□ Does she have an enforceable contract?

Answer 170

A: Yes, because it falls outside the statute and doesn’t need to be in writing to be enforceable by law. This is because the contract can be completed in one year if he dies before the year end (no one can say for certainty that they will live longer than a year)
□ No end date (can it not end?)

Question 171

2) All contracts for the sale of land or interest of land (must be in writing- to be enforceable)

Answer 171

2 categories of Property:
□ Real Property – land or interest of land, sometimes called immovable
□ Personal Property – tangibles and intangibles, everything else which is sometimes called chattels, goods, or things – movables
□ Lease of property is personal

Question 172

Land

Answer 172

Not just the earth, but anything attached to the land – house, buildings, tree, fence, barn, also rock (came from within the land), etc. (anything that flows within/under the land- minerals, etc.) a condo is land
□ Trailer dug into the ground – Real property
□ Trailer with its wheels still on – Personal property

Question 173

Interest of land

Answer 173

anything that flows on, within, or under the land (rock, water, minerals, etc.)

Question 174

Land

Answer 174

□ Every parcel of land has a lot or block number to it (urban), this is called the legal description (legal address)
□ Rural – township, section, etc.
□ Civic Address/Postal Description – 120 Delarande Road
□ Legal Description – Lot 6 Block 67 (urban)
□

Question 175

Land Titles Office

Answer 175

includes 60 mile area of the city would have the land title in that land.
□ For a document to be valid, it must be registered
□ Anyone can go to the office of public record

A Land Titles Office is a government agency or department responsible for maintaining and recording official records related to land and real property within a specific jurisdiction. Land titles offices play a crucial role in ensuring the accuracy and security of property ownership and transaction records. Their specific functions and procedures may vary from one jurisdiction to another, but they generally include the following:

Land Title Registration: Land titles offices record and maintain records of property ownership. Each piece of land or real property is assigned a unique title or registration number, and the office keeps records of all transactions related to that property.

Transfer of Ownership: When property ownership changes due to sale, gift, inheritance, or other means, the land titles office records the transfer of ownership. This typically involves updating the ownership details on the property’s title.

Mortgage and Liens: The office records information related to mortgages, liens, and encumbrances on real property. This ensures that anyone conducting a title search is aware of any financial interests or claims on the property.

Legal Descriptions: Accurate legal descriptions of land and property boundaries are recorded to ensure clarity in property ownership. These descriptions are typically based on survey data.

Cadastral Surveys: Land titles offices often work with cadastral surveyors to establish property boundaries and legal descriptions. The results of these surveys are used to update property records.

Title Searches: Interested parties, such as potential buyers, sellers, lenders, and legal professionals, can conduct title searches at the land titles office to verify property ownership, encumbrances, and other property-related information.

Maintaining Records: Land titles offices maintain and archive historical records, ensuring a complete and accessible history of all property transactions.

Issuing Certificates of Title: A certificate of title is a legal document that confirms a person’s or entity’s ownership of a property. Land titles offices issue these certificates upon request or during property transfers.

Fraud Prevention: Land titles offices take measures to protect against fraudulent property transactions, such as forgery or unauthorized title transfers.

Customer Services: These offices often provide services to the public, including assistance with property inquiries, title searches, and the filing of various land-related documents.

Land titles offices are essential for maintaining the integrity and transparency of property ownership records, thereby supporting economic activities and legal processes related to real estate. The specific name and organization of land titles offices can vary from one jurisdiction to another, and they might be referred to as land registries, land record offices, or similar titles. The accuracy and reliability of the information held by these offices are critical for property transactions and for ensuring that property rights are upheld in a legally defensible manner.

Question 176

Land Title System

Answer 176

modern, in SK and other western Canadian provinces
□ Includes a Certificate of Title
□ This certifies that “John Brown” is the owner of an estate in fee simple
lot block plan
□ Fee Simple – in 1066 people were given “grants” of land (usage of land), they were free people, pronounced as “fief”
□ Guaranteed Title System

Question 177

Land Registry System

Answer 177

Eastern Canada, this is not a guaranteed title system
□ You have to search 40 years back to see if there is any claim on the land
□ -depository system, anyone can put claim in line- not guaranteed title (can be dangerous to rely on title)
□ Torreans – system of land registration

Question 178

Fee Simple (fief)

Answer 178

□ If you conduct a historical search of the land, it will always lead back to the Queen/the king (his majesty the kind in right of Saskatchewan)
□ No one owns the land upright
□ Expropriation Procedure Act – gives the Crown the right to take back its land
□ Going to court will only involve the amount of compensation you will receive, however, you cannot stop the government from taking your land PROVIDED it is meant to be used for public purposes

Expropriation -city is pretty generous
Infesimple
1. fee simple -highest fee of ownership
2. Life estate- like a tenet for life, cant mortgage or sell it (land has to be as was)
3. easement – right to use the land of another – person who grants easement is servient tenant, the person who uses (dominant tentent) -don’t need to know names
4. right of way- giving right to cross someone’s land (e.g. water or something)
5. restrictive covenant- limits any restaurant/drug store, anything you do not want on the land, etc. from being on the land

Question 179

Fee Simple Cont…

Answer 179

“Fee simple” is a term used in property law to describe a type of freehold estate in land. It represents the highest and most complete form of ownership one can have in real property. When someone owns property in fee simple, they have the greatest bundle of legal rights and interests in that property, including the right to possess, use, lease, sell, and will it to heirs.

Here are some key characteristics of a fee simple estate:

Absolute Ownership: Fee simple is often described as “absolute ownership” because the owner has the fullest bundle of rights and interests in the property. They can do almost anything they wish with the property, subject only to the limitations imposed by law.

Inheritance: The owner can pass the property on to their heirs through a will or, in the absence of a will, through the laws of intestate succession. This means that the property can remain in the family for generations.

No Time Limit: Fee simple ownership is typically not subject to any time limits or conditions. It is not a temporary or limited interest in the property.

No Reversion: When the fee simple owner passes away or decides to sell the property, it does not revert to anyone else. It can be transferred to a new owner without restriction.

Alienation: The owner has the right to sell, lease, or transfer the property to others without seeking permission from anyone else.

Liens and Mortgages: The owner can encumber the property with liens or mortgages, using it as collateral for loans or debts.

It’s important to note that while fee simple ownership grants significant rights and control over the property, it is still subject to some limitations, such as property taxes, zoning regulations, and eminent domain (the government’s power to take private property for public use, with compensation to the owner).

In summary, fee simple is the most extensive form of property ownership, representing full control, the ability to pass the property to heirs, and the right to enjoy and dispose of the property as the owner sees fit, within the bounds of the law.

Question 180

Co-ownership of Land

Answer 180

(two or more people own the same land)
□ Joint tenants (ownership) with right of survivorship – two or more persons own an undivided parcel of land entirety of which will go to the last survivor (common in husband/wife situations)
□ Tenants in Common – two or more persons own an undivided parcel of
land and either person can deal with their share as they see fit. If not, states are assumed to be 50/50 (can be 75/25)

□ Giving of a deposit and receiving of a receipt is not an enforceable contract, even if there is evidence of contract (must be in writing)
Guaranteed land title system computerized information services corporation (I.S.C) -give legal description (PIN- property information number)

Question 181

DOCTORINE OF PART PERFORMANCE

Answer 181

(extremely narrow exception)
□ Where (there is)in a verbal contract for the sale of land, the purchaser performs certain acts and those acts are consistent only with the performance of that contract (that very property) and no other, then he can rely (plead) on the doctrine of part performance to enforce the verbal contract for the sale of land.
□ Law recognizes that people enter verbal contracts for the purchase of
land that they relied on performance of the contract, and then the doctrine is enforced
-e.g. b/c boxes could’ve been used for other purposes other than the land (apples)- court ruled against the buyer

□ *A verbal lease is enforceable if it is under 3 years
-deposit for land doesn’t mean anything – need in writing

Question 182

3) All contracts in the promotion of marriage

Answer 182

E.g. if a father offers a prospective groom money (or land) to marry his daughter, it must be in writing to be enforceable in law

Question 183

4) All contracts where in an executor (or administrator) (assigned by will) of an estate agrees to be personal liable/responsible for the debts of the estate
□

Answer 183

ESTATE
□ The assets of the deceased person
□ Executor – person named in the will (executrix -if female) -
□ Administrator – when there is no person stated in the will
□ Everything the person owns when they die -pay bills from estate

Question 184

ADMINISTRATOR OR EXECUTOR

Answer 184

□ Carries out instructions in a will, or if no will, carries out instructions where law imposed will
□ Job is to determine all assets of the estate, gather all assets, pay debts, and then distribute estate in accordance with a will or the law
□ Does not have to pay debts out of his/her own pocket, unless agreed to do so. This agreement would have to be writing (ex. Decide to pay a parents estate so the creditors will not sue the estate, don’t want to tarnish name)
□ Ex. I will not sue the estate so I will be responsible for the debt
□ Closest blood relative when the person dies agrees to pay debts of estate
□ Gathers in all the assets of estate and determines all the debts of the estate
□ Then pays the just debts
□ Then distributes the estate according to the will
□ If not enough to pay off debt, creditors will take less
□ Doesn’t have to dig into his own pockets to pay debts unless he is personally liable (has to be in writing)

Question 185

5) All contracts wherein one person agrees to be responsible for the debt or default of another person (Contract of Guarantee)

Answer 185

□ Must be in writing to be enforceable by law (falls inside the statute)
□ There is a principal debtor and a secondary debtor
□ Contract of Indemnity where a person assumes all debt does not have to be in writing
□ A guarantee is voided if the terms of the contract are changed, unless unilaterally agreed upon by bank

□ Two types of loans for guarantors (look up in text)
□ If the bank changes the terms of repayment
□ Assume that the bank cannot unilaterally change the terms of a loan

□ Can the borrower go back and get more money?
□ The guarantee must not be liable for the borrower if he or she gets more money

-“bank” Lend him the money and IF he (principle debtor) does not pay you then I (secondary debtor =guarantor) will (guarantee) – need to be in writing cannot unilaterally make changes with the principle and not the guarantor it nullifies the gaurentee)

-“bank” Lend him the money and I will pay you (Indemnity) -does not have to be in writing to be enforces, you are assuming to be the principle debtor

Question 186

6) “All contracts for the sale of goods act (personal property) of the value of $500 or upwards shall not be enforceable by court action, unless the buyer shall accept (and receive) all of the goods sold and actually receive the same or in part payment (deposit), or unless some note or memorandum in writing of the contract is made and signed by the party to be charged or his agent in that behalf

Answer 186

Property
□ Real property (Immovable)
□ Land/interest on land
□ *Land is also everything that is on the land itself (eg. trees, house, etc.)
□ You have ownership on the land and everything in it
□ Personal property (movable)
□ Goods
□ Things
□ Chattel

Question 187

Two types of land systems

Answer 187

Land title system
□ Information Services corporation: every registrable land in SK is provided
□ PIN
□ Property info number

Registry system
□ Certificate of Title: guaranteed title system

Certificate Title
□ Estate in fee simple
□ Life estate
□ Right of way (right to cross property)
□ Leasehold interest
□ Easement

Question 188

Two types of land ownership

Answer 188

□ Expropriation: implies the highest form of ownership (no one owns the land fully/outright)
□ Life estate: form of ownership where the land is split between families (The land can’t be sold)
□ Doctrine ot part performance: exception to the rule that does not have to be written but can be a verbal. Law recognized that the verbal agreement is for the purchase of the land, which the doctrine is now enforced.

There are two primary types of land ownership:

Freehold Ownership (Fee Simple):

Freehold ownership, often referred to as fee simple ownership, represents the highest and most complete form of land ownership.
When you own land as a freeholder, you have full and absolute control over the property. You can use, manage, lease, sell, or bequeath the land as you see fit.
This type of ownership is indefinite and does not have a set time limit. It allows you to pass the land on to your heirs through inheritance or sell it to another party.
Leasehold Ownership:

Leasehold ownership is a form of land ownership where a person or entity (the lessee) holds the rights to use and occupy the land for a specified period under a lease or rental agreement.
The landowner (lessor) grants the lessee certain rights over the land for the duration of the lease agreement, which can range from a few years to several decades or more.
While the lessee has the right to use the land, they do not have the same level of control as a freeholder. The terms and conditions of land use are typically outlined in the lease agreement.
Leasehold ownership often applies to various situations, including residential leases, commercial leases, agricultural leases, and more.

Question 189

Co-ownership:

Answer 189

where two or more persons own the same parcel of land
□ Tenants in common
□ Two or more persons own an undivided amount of parcel
□ Joint tenants with right of ownership

Question 190

Lease:

Answer 190

has to be in writing if it is 3 years or more. Any lease under 3 years does not have to be in writing

Question 191

Sale of Goods Act:

Answer 191

a contract for the sale of goods of the value or $50 or upwards shall not be enforceable by court action unless the buyer shall receive and accept all or part of the goods still sold or give something in earnest to bind the contract or part payment or some note or memorandum in writing of the contract is made and signed by the party to be charged or his agent by his behalf

Question 192

Panel Evidence Rule:

Answer 192

cannot bring in extrinsic evidence to contradict the agreement

Question 193

A contract for the Sale of Goods

Answer 193

is one which a SELLER transfers OR agrees to transfer the ownership (title/property) in goods (personnel property) to a BUYER for a money consideration called the PRICE (always payment of money). Moment contract is made ownership is transferred (risk of loss buyer) , agreement for sale at a future time/transferred at future time (risk of loss remains with the seller)
-all property- element of ownership and element of possession
-wheels =personal property
* Seller will transfer title goods and buyer will transfer money.
* Seller transfers present (or agrees to transfer)–> buyer transfer future (agreement of sale)
* Ownership = Risk of loss
o Risk of loss is determined if it’s a sale or an agreement to sale.

• Personnel property not real property
• Exchanging goods is barter (no payment of money involved)
• Moving goods from one place to another is transit
• Bailment is a storage contract (i.e. dry cleaners)
• When does ownership pass from seller to buyer?
  o If ownership transfers at the present time it is called a sale
  ▪ In a sale, when a contract is made, buyer bears risk of loss
  o If ownership is to transfer at a later date it is called an agreement of sale
  ▪ In an agreement for sale, when a contract is made, seller bears risk of loss

Question 194

The Sales of Goods Act

Answer 194

• In order to determine when ownership passes we look at the nature of the goods sold:
  o Specific (ascertained)
  ▪ Good that are identifiable
  ▪ Can point out/put finger on
  ▪ Where there is a contract for the sale of specific goods, the title to the goods is then transferred to the buyer from the seller at the time/when the parties of the contract have intended it to be transferred. (look to the contract)
  o Unascertained (non-specific/not determined)
  ▪ Good that are not identifiable

▪ Where there is contract for the sale of unascertained goods, no title of the goods passes from the seller to the buyer, unless and until they become apportioned (set aside/in transit) to the contract. (Until the goods have been ascertained in portion to the contract)
▪ It’s an agreement for sale
▪ Risk of loss is with the seller
▪ If can’t put your finger/mind on it

Question 195

A contract for the sale of goods (personal property)

Answer 195

of the value of $50 upwards shall not be enforceable by action unless the buyer shall accept part of the goods so sold and actually receive the same or give something in earnest to bind the contract (historically handshake) or in part payment (make a deposit) or some note or memorandum in writing in the contract is made (indicates parties agree) and signed by the party to be charged or his agent in that behalf
-don’t have to be in writing if one of the or’s are present
-3 ways personal property sales can be enforced in court

-if have no accepted it don’t have to pay

-buyer has to receive the goods (or part of the goods) but if not quality don’t have to accept

Many different types of contracts dealing with personal property (e.g. barter , bailment (store goods), transport, consignment (had full legal right to sell it, give him money minus consignment fee-must be careful), leasing )—only focus is on sale of goods

Question 196

EXAMPLE: Prof. agrees to sell you 10 chairs in ESB 18
▪ Fire burns 10 chairs in the room
▪ He tells you that the 10 chairs you bought were the ones burned in the fire

Answer 196

□ Conclusion: Chairs are unascertained because they could be any of the 10 out of the 100 chairs in the room

□ TWIST: If he said “10 chairs in the front row”, it would be specific
□ *Also, example dealing with Jersey cows (specific), half the heard (unascertained) and potatoes (unascertained)

Question 197

□ EXAMPLE:
Couple buys a trailer on wheels (not real property, its personal property) and are intended to receive it on Sunday at 1. “When can move into trailer (when will have possession)”, not when title/ownership is transferred (didn’t ask) *Ownership is the important thing in law
□ Trailer burns down on Saturday night
□ Who is at a loss? The buyer or the seller?

Answer 197

Conclusion: Buyer is at a loss because the contract was silent (only talks about possession) as to when ownership would pass (it never stated when ownership would pass, only when POSSESSION would pass) -sale

Question 198

The Sales of Goods Act (In order to determine when ownership passes)
Rule 1:

Answer 198

When there is an unconditional contract for the sale of specific goods in a deliverable state (condition in which prepared to accept them), the title of these goods passes from the seller to the buyer the moment the contract is made, and it is immaterial (doesn’t matter) whether the time of payment (in full) or delivery/possession (has not taken place) or both be postponed.
* It doesn’t matter when the money is paid or when the item is
delivered possession), but rather when the contract is made.

We turn to the contract

Silent – means they haven’t agreed or stated

Sale – where there is an unconditional contract for sale of goods the moment the contract is made

Bought car, paid half Monday go to pick up on Thursday (pay rest then), got keyed on Wednesday – who owns ?
-the Buyer does b/c it was a sale

Question 199

Rule 2:

Answer 199

Where there is a contract for the sale of specific goods and the seller is bound (obligated) to do something to the goods for the purpose of putting them into a deliverable state, the title does not pass until that (thing) has been done and the buyer has noticed his mistake.
* Some form of altercation
* Any form of notification will do (phone, letter, etc.)
* Cleaning doesn’t count, has to actually change the good.
* Condition added to the contract

• E.g. trailer situation, had agreement for sale (seller would have suffered loss)- if repairs were contracted to be done Sunday morning (condition) and burned down Saturday then agreement and seller suffers
  o If fixed it Saturday morning and would have notified the buyer (anyform) then it would become a sale (buyer would suffer loss)

Question 200

Rule 3:

Answer 200

Where there is a contract for the sale of specific goods in a deliverable state, but the seller is obligated/bound to weigh, measure, test, count or do some other thing/act with reference to the goods for the purpose of ascertaining the price, the title does not pass until that act or thing (duty) has been done and the buyer has notice thereof.
□ -once count there is 10 jersey cows at $2000 a head and notify buyer they owe $20000 then it’s a sale

Question 201

Possession

Answer 201

• Possession of a good takes place – look in the contract, it will outline when possession takes place.
• When the contract is silent to when you are entitled to possession, you or not entitled to possession until the price has been paid in full.
• Where will delivery take place – look to the contract. If silent then
  the buyer has the obligation to go get goods from where they are located (seller isn’t responsible).

-when buyer entitled to possession- look to the contract, if silent =law says when you pay the price in full

-where does possession take place- look to the contract, if silent = law says at the sellers place of business (no place of business- then wherever the goods are situated)

Question 202

Security Agreement (Security contract)

Answer 202

1) Conditional Sales Contract
2) Chattel Mortgage

Question 203

1) Conditional Sales Contract

Answer 203

• Seller gives up possession but retains ownership/title, until buyer has completed full payment.
• Form of contract for sale of goods (buyer and seller) specialty type of contract
• Seller has title and ownership

Question 204

Lien agreement (possessors’ right):

Answer 204

a security agreement must clearly reserve ownership for the seller.

Otherwise title is considered to pass from seller to buyer the moment the contract is made (registered prior to it being sold to innocent buyer)- right to possess is gone if do not register until after sold to innocent buyer
o E.g. mary bought tv stand from best buy- set it up at home but still owes $1000, she in possession but best buy still owns it
o E.g. motors repossessing from I2

A possessors’ lien, also known as a possessory lien or lien agreement, is a legal right that allows an individual or entity (the “possessor”) to retain possession of certain property, goods, or assets until a specific debt or obligation is satisfied. This lien provides the possessor with a form of security, ensuring they will be compensated for the debt owed by the property’s owner. Possessors’ liens can arise in various situations, such as services provided, storage of goods, or repairs to property.

Here are the key elements and features of a possessors’ lien:

Possession of Property: The lienholder must have physical possession of the property, which may include personal property, vehicles, machinery, or other assets. This gives them control over the property as security for the debt owed.

Unsatisfied Debt or Obligation: The lienholder has a legitimate claim against the owner of the property, usually in the form of an unpaid debt, fees, or charges. The lien may also apply to outstanding expenses, such as storage fees, repair costs, or unpaid services.

Right to Retain Possession: The lienholder is granted the legal right to retain possession of the property until the debt or obligation is satisfied. They can hold the property as collateral until the owner fulfills their payment obligations.

Enforcement and Sale: If the property owner fails to fulfill their financial obligations within a specified period (as determined by local laws or the lien agreement), the lienholder may have the right to enforce the lien. This typically involves selling the property to recover the owed amount. The sale proceeds are used to satisfy the debt, and any remaining funds may be returned to the property owner.

Legal Requirements and Documentation: To establish and enforce a possessors’ lien, there are specific legal requirements that must be met. These requirements may vary by jurisdiction and are typically outlined in lien laws. Proper documentation and notifications to the property owner are essential to ensure the lien is legally enforceable.

Question 205

2) Chattel Mortgage

Answer 205

(another type of security agreement)

• Where seller gives up title to the bank as security (collateral) but keeps possession, in exchange for a loan, etc. until full repayment is made. Seller gives up ownership but keeps possession
  o Bank search I.S.C to see if you own (no claims or liens)
  o Seller Gives up title but keeps possession (so if seller tries to sell/or don’t make payments bank exercise lien right and will seize the vehicle

Question 206

Personal Property Security Act (PPSA)

Answer 206

• In order for an unpaid seller to repossess goods it has to be in the possession of the original buyer. If the buyer sold it to an innocent buyer (innocent buyer also known as a Bona Fide-buys it in good faith) (no knowledge of any defect of the sellers right to sell him the goods)
• If the unpaid seller failed to register the lien prior to it being sold to
  the first innocent buyer, or failed to register in time has no right to repossess from innocent buyer.
• To be able to repossess from an innocent buyer must register
  security (lien) agreement at the PPSA (Regina) prior to the first sale to an innocent buyer taking place
• Caveat emptor – “buyer beware” (go to I.S.C with cereal number and name of seller -find out if under conditions, who has title of it, find out any liens or claims)
• Nemo Dat Quod Non Habet – “cannot give what no have” ** important principle (I1 can’t give title to I2 b/c he does not have it)
  o Why does a seller not give title to a buyer? Because the seller may not have ownership at the time

Question 207

Limitation of Civil Rights Act

Answer 207

(not confuse with human right (right of free speech, etc.)
* Applies to both real and personnel property. Where there is a conditional sales contract the right of the unpaid seller is limited to repossession of the goods sold and can’t sue.
* Limits civil rights to sue for money owe, etc. conditional sales
o If you take out a remortgage (i.e. $250,000 back up to
$350,000), then you are not protected by the act and therefore can be sued for the entire amount ($350,000)
o This is because this money is not being used for mortgage property anymore (its being used for a new car, vacation, etc.)
o Instead take out a second mortgage if you want the extra
$100K
-ex. Mary brown not pay- most best buy can do it repossess goods and sell it, if make surplus on it must pay it to the buyer can’t sue (can loss money but can’t enrich self)
* Limits the right of the unpaid lender to the property sold and no action shall be done against the buyer (no action to lie on the covenant to pay).
o If used mortgage money to pay for house they can’t sue you (protected by limitation of civil rights act)t5
* Bank gets around this by making you sign promissory note and having a chattel mortgage
* Forclosure is court procedure for lender/creditor to take over
* Quit claim deed

• When there is a mortgage, it limits the right of the unpaid mortgagee to repossession (foreclosure) of the property sold, and no action shall lie on the personal covenant to pay.
  o Only protected if mortgage money was used to buy the mortgaged property
  o **Don’t remortgage property. Ask for a second mortgage instead
  o Also, protection is transferable from one buyer to another

-mortgage (charge against land)

-Mort ; death

-Gage ; pledge

Question 208

Consumer Protection and Businesses Practices Act **important statute

Answer 208

• Provincial statute (every province has a similar one)
• Protect you as the consumer when you buy something
• Statue applies only to personal property (sale of goods), and from a manufacturer or someone in the retail business, does not apply to the private purchase (more risk)
• Parol evidence rule; if I enter to verbal contract with you involving a sale of goods, we decide to reduce It to writing; where a contract is reduced into writing (even with one that did not need to be to enforced) this rule provides that where there is any contradiction between what was verbally agreed upon then contradicts writing (forbids outside evidence that contradicts) – writing takes precedence over what was verbally agreed upon – if contract between retailer and self (promised all sorts of things) parol evidence is over ruled (abolished by consumer protection act)
• Deals with consumers to retailers only:

Question 209

Unfair practices (p. 74, 540-541) (by retailer)

Answer 209

o Any deceit (dishonesty)
o Any representation of the goods one of a particular quantity, good or used if not
o Telling consumers about services that come with the good that really don’t
o Using exaggeration/ambiguity/misleading/deceptive (failing to disclose material)
o Undue influence/pressure
o Act distinguishes between individual and corporation
* Penalty for individual retailers: who commits unfair practice
o First offence – Fine up to $5000 and/or imprisonment of not more than 1 year
o Second offence – Fine up to $10,000 and/or imprisonment for 1 year
* Penalty for corporation:
o First offence – Fine of not more than $100,000
o Second offence – Fine of not more $500,000

Trade puffing ; “best pizza” , exaggeration (bullshit) – if over limit (misrepresentation/fraud) then protected against the retailer , take advantage of someone under 18

Question 210

Competition Act:

Answer 210

promotes competition and competition among corporations. It controls mergers. If the merger lessens competition then the merger won’t happen.
o If anybody is trying to lessen competition, could be fined $25 million, and directors might be charged with lengthy jail time.
* Identity Theft: carries a term of imprisonment of up to 10 years.

Question 211

All contracts for the sale of goods act (personal property) of the value of $500 or upwards shall not be enforceable by court action, unless the buyer shall accept (and receive) all of the goods sold and actually receive the same or in part payment (deposit), or unless some note or memorandum in writing of the contract is made and signed by the party to be charged or his agent in that behalf

Answer 211

Contracts for the Sale of Goods: This part of the statute applies to agreements in which one party is selling personal property or goods to another party. These could be items like electronics, clothing, furniture, or any other tangible, movable property.

Value of $500 or Upwards: The statute becomes relevant when the value of the goods involved in the contract is $500 or more. In other words, if the value of the goods is below $500, this specific requirement does not apply.

Shall Not Be Enforceable by Court Action: This means that a contract for the sale of goods, meeting the $500 threshold, cannot be enforced through legal action unless it complies with the statute’s requirements.

Unless the Buyer Shall Accept (and Receive) All of the Goods Sold: To enforce the contract, the buyer must physically accept and take possession of all the goods mentioned in the contract. In other words, the buyer must actually receive the items.

Or in Part Payment (Deposit): Alternatively, the contract can be enforced if the buyer makes a partial payment (typically a deposit) for the goods. This partial payment serves as evidence of the contract’s existence.

Or Unless Some Note or Memorandum in Writing of the Contract Is Made and Signed: The most common way to satisfy the Statute of Frauds is by creating a written document that outlines the terms of the contract. This document, which could be a sales agreement or purchase order, should be signed by the party being charged under the contract (usually the seller) or by their authorized agent.

So, in practical terms, if you’re involved in a contract for the sale of goods valued at $500 or more, it’s a good practice to ensure that there’s a written agreement (a contract) that outlines the terms and conditions of the sale and is signed by either the seller or their authorized agent. This way, you have a legally enforceable document to protect your rights if any disputes arise.