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Canadian Bankruptcy Law Is Out Of Date

Friday, March 13, 2009

This commentary was first published in the Financial Post on March 10, 2009.

Every modern society needs a balanced, well-functioning insolvency law to take care of the inevitable casualties of a free-market economy. This is true even when the economy is buoyant. It becomes imperative when the economy is in recession with bankruptcies mounting.

Insolvency law has two major goals. The first is to provide an orderly procedure for the liquidation of insolvent estates and distribution of the proceeds among the debtor's creditors in a prescribed order. The second goal is to enable viable enterprises to restructure their affairs so as to save jobs and stay in business and, in the case of individuals, to enable them to compromise their debts and avoid the stigma of bankruptcy.

These goals seem simple but their implementation has become increasingly complex because of the size and variety of claims and because bankruptcy law is often called upon to solve problems that have their origins outside bankruptcy. In addition, a major transformation has occurred in the consumer insolvency area because of the phenomenal growth in consumer credit.

Class Actions: The Consumer's Best Friend?

Tuesday, February 24, 2009

This commentary was first published in the February 20, 2009 issue of The Lawyers Weekly (published by LexisNexis Canada Inc.).

The last twenty five years have not been kind to consumers in Canada. This is not because of a lack of  consumer protection laws - quite the contrary. The reason is almost entirely due to the unwillingness of the federal and provincial governments to provide the necessary resources for the enforcement of the laws that exist. As a result, much of the legislation has no bite to it and is often openly flouted in practice.

Fortunately, however, an unexpected best friend of consumers has appeared from almost nowhere to come to the consumer's aid. That best friend is class actions. A class action is an action brought on behalf of all members of a designated class of plaintiffs who claim to have been adversely affected by the defendant's wrongful conduct and who seek relief. If the action is successful, it may result in a large sum of money being paid into a fund for distribution among the members of the class or a finding that the members of the class have a valid cause of action and requiring the members to prove what damages they have suffered individually.

The Green Energy Act: Green Energy Unbounded

George Vegh
Tuesday, February 24, 2009

On February 23, 2009, the Minister of Energy and Infrastructure introduced the Green Energy and Green Economy Act, 2009 for first reading in the Ontario Legislature.  The Green Energy Act has broad policy implications for energy and environmental policy.  The attached commentary addresses the impact of the Act on public utility regulation in Ontario.  The author looks forward to feedback on this commentary and also encourages comments on other impacts of the Green Energy Act.

Download Green Energy Unbounded

 

Symposium on Lifelong Learning in Professionalism: Live Webcast on Friday Feb. 20

Thursday, February 19, 2009

On Friday February 20, 2009, the Centre for the Legal Profession at the Faculty of Law, University of Toronto, is hosting a Symposium on "Lifelong Learning in Professionalism" organized by the Chief Justice of Ontario's Advisory Committee on Professionalism. 

The Symposium is being sponsored by the Law Foundation of Ontario, with additional support from the Law Society of Upper Canada. The Symposium features panel discussions with noted academic scholars, members of the judiciary, and legal practitioners.

The day will begin with an exploration of the scope and importance of lifelong learning, and continue with an examination of what can be learned from other jurisdictions and the role of various stakeholders within the legal profession in advancing education in professionalism. The day will close with the 2009 Annual Goodman Lecture, delivered by the Honourable Justice Stephen Goudge of the Court of Appeal for Ontario.

The symposium will be webcast live on Friday Feb. 20 beginning at 9:00 am EST. The webcast will also remain available as an archive after the event.

Visit the Symposium web page and watch the webcast.

 

BCE Decision Roundtable, March 27, 2009

Friday, February 13, 2009

Faculty of Law, University Of Toronto
Flavelle House, 78 Queen's Park,
McCarthy Tétrault Classroom (FLA) 

In December 2008, the Supreme Court of Canada released its reasons in the highly publicized BCE case, affirming that Canadian corporate directors owe their fiduciary duty to the corporation and only the corporation. The decision stands to have a significant impact on merger and acquisition transactions in Canada, and is of fundamental importance to boards of directors as well as to shareholders, creditors and corporate stakeholders generally.  We look forward to an interactive roundtable discussion on the implications of the Supreme Court's decision.

Read more

 

Taking a Buy Canadian Route Would be a Legal Sell-Out

Ed Morgan
Friday, February 13, 2009

This article was first published in the Globe and Mail on February 12, 2009.

In one of his more dramatic Question Period performances, the federal NDP Leader announced last week that the “United States has had a Buy American Act for 76 years,” and that “it's perfectly legal.” He then followed up: “Can the Prime Minister tell us what's wrong with a Buy Canadian policy as permitted under continental and global trade rules?”

The question was prompted by the new protectionist proviso attached to Congress's economic stimulus bill. It is, however, premised on a faulty foundation.

The legal truth is a complicated one. It involves a fine analysis of U.S. legislative history, along with Canada's treaty obligations under the North American free-trade agreement, and the World Trade Organization rules and their annexes on central and subcentral government procurement policies. The Canadian Auto Workers, with their allies the United Steelworkers, have procured a legal opinion on which Jack Layton's assertions are apparently based, although a careful reading of the opinion reveals the complexity. But if you think organized labour and its politicians can't turn a multifaceted legal question into a singular polemic about economic nationalism, then you don't know Jack.

Webcast of Roundtable on the Creation of a National Securities Regulator

Thursday, February 12, 2009

On January 30, 2009, the Faculty of Law hosted a roundtable on the creation of a national securities regulator and the report of the Expert Panel on Securities Regulation, featuring Profs. Anita Anand and Jeffrey MacIntosh, as well as experts Jeremy Fraiberg and Peter Hogg. The webcast of the event is available on the Faculty of Law website.

 

Pegged Orders: An Unfair Trade

Jeffrey MacIntosh
Thursday, January 15, 2009

This article was first published in the Financial Post on January 13, 2008.

In the old days, stock exchanges had a monopoly on trading listed stocks. Not any more. These days, electronic platforms known as “alternative trading systems” (ATSs) provide investors with a variety of trading forums. Some of these, like BlockBook, Liquidnet and MATCH Now, exist solely to cross large (mostly institutional) blocks of stock. But others, like Pure Trading, Alpha, Chi-X Canada and Omega, serve the entire investment community — trading some or all of the TSX and TSX-V listed stocks.

By introducing competition to stock trading, ATSs have already lowered the cost and increased the speed and efficiency with which stocks are traded. Nonetheless, the ATS phenomenon is still in its infancy in Canada — and so is the regulatory framework. While the regulatory apparatus mostly works very well, some recent trading practices have arisen that materially compromise the fundamental principles of price discovery and liquidity that lie at the very core of a modern trading system.

Price discovery involves the determination of a suitable trading price for a given security. Liquidity occurs when investors can easily (and at reasonable cost) find a counterparty with whom to trade.

Shooting Down Polygamy Law Not Necessarily A Slam Dunk

Lorraine Weinrib
Tuesday, January 13, 2009

The following commentary by Professor Lorraine Weinrib was published in the Toronto Star, January 13, 2009.

The attorney general of British Columbia has announced criminal prosecutions against two leaders of the Fundamentalist Church of Jesus Christ of Latter Day Saints for breach of the Criminal Code prohibition against polygamy. The decision to prosecute follows years of deliberation on the appropriate response to harms attributed to polygamy as practised within the community in Bountiful, B.C.

Examination of some of the concerns raised in the media over the past week may provide some clarity as the prosecution proceeds.

Supreme Court of Canada's Decision in Lipson

Benjamin Alarie
Thursday, January 8, 2009

Earlier today the Supreme Court of Canada released its judgment in the Lipson case (about which I blogged earlier here).  The Court was sharply divided, 4-3, in favour of dismissing the taxpayer's appeal from the decision of the Federal Court of Appeal.

The Lipsons engaged in a series of transactions over two days in 1994 in which they made use of various rules, including the spousal rollover rule (section 73), the spousal attribution rule (section 74.1), and the back-to-back loans rule (subsection 20(3)), to transform what would otherwise have been non-deductible mortgage interest under paragraph 20(1)(c) into, they argue, deductible interest under paragraph 20(1)(c).

The facts are as follows...

Earl and Jordanna Lipson were a married couple.  On April 24, 1994, they entered into an agreement of purchase and sale to purchase a personal residence for $750,000 with a $50,000 deposit.  On August 27, 1994, the Lipsons signed a letter addressed to their solicitor stating that the Bank of Montreal was lending them $562,500 on September 1, 1994 to place a mortgage on the new property.

On August 31, 1994, the following transactions occurred:

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