Buyer Beware: Employment After Share Sale
April 6, 2021 By Brian Babcock Employment contracts related to commercial transactions remain employment contracts and employment law applies. You should not ignore this if you are involved in a purchase and sale transaction, or any terminations after the sale. Ontario courts continue to find in favour of employees on termination of employment issues. In […]
What is a “Quistclose Trust”?
March 30, 2021 By Brian Babcock A Quistclose trust is a trust created where funds are advanced to another person (or corporation) for a specific purpose, on the condition that they be used only for that purpose, and returned if they are not used for that purpose. The name comes from a British case where […]
Corporations, Charter Rights, and Cruelty
March 7, 2021 By Brian Babcock A corporation may be treated like a natural being for many purposes in the law, but not when it attempts to claim the protection of the prohibition against “cruel and unusual punishment” in the Canadian Charter of Rights and Freedoms. The issue was decided by the Supreme Court of […]
Unincorporated Associations and Trusts
February 21, 2021 By Brian Babcock Unincorporated associations are very common creatures. Most of us belong to them at some stage. Sports teams, clubs, and homeowners associations are just a few examples. You likely do not realize that in the eyes of the law, unincorporated associations do not exist. As Justice Eileen E. Gillese puts […]
Clarifying the Need for Honest Performance of Contracts
February 14, 2021 By B. Paul Jasiura The duty of honesty in the performance of a contract applies to all contracts and means “simply that parties must not lie or otherwise knowingly mislead each other about matters directly linked to the performance of the contract”. This quotation from the 2014 decision of the Supreme Court […]
Who Cares about the Duty of Care?
December 23, 2020 By Mark Mikulasik You should, if you operate a business. If you want protection from business financial losses caused by shoddy products, you better have a contract. That is the message that the Supreme Court of Canada is sending in 1688782 Ontario Inc. v. Maple Leaf Foods Inc. This case arises out of […]
Trusts vs Agency
October 16, 2020 By Brian Babcock Trusts and agency are both legal concepts about relationships. Perhaps because of this commonality, people often confuse the two. They are quite different and recognizing which relationship exists in a particular situation may be crucial to understanding what your legal rights and responsibilities might be. There are many differences. Some […]
Assignment of Contracts and Good Faith
August 21, 2020 By Brian Babcock Does an agreement that requires consent to its assignment carry with it an implied understanding that consent will not be unreasonably withheld? Commercial contracts often include a clause which requires the consent of one party to the assignment of the contract by the other party to an outsider. Where these […]
Undue Influence and Spousal Guarantees
August 19, 2020 By Brian Babcock There is not always undue influence when a spouse personally guarantees the corporate debt of their spouse’s business. A written certificate of independent legal advice is not always required to maintain the validity of the guarantee. Historically, courts have found undue influence makes a guarantee unenforceable in situations which typically […]
Taking Arbitration Clauses Seriously
June 19, 2015 By Brian Babcock Canadian courts are increasingly willing to enforce the terms of arbitration clauses in commercial agreements. Canadian businesses need to learn to take these clauses seriously. For many years, even decades, our clients did not take commercial arbitration clauses seriously, and for good reason. If a dispute arose, even if the […]