Legal Insights & Practice Trends

The Canadian Bar Association

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No hiding behind the Swiss Verein

By National July 31 2015 31 July 2015

    Recently, a U.S. International Trade Commission judge disqualified Dentons US LLP from representing Cleveland-based RevoLaze LLC, in a patent suit against Gap Inc. Gap had filed the motion to disqualify arguing that it had long been a client of Dentons Canada, which placed the firm in a conflict of interest. Citing ABA Model Rule 1.0 in his ruling, Judge Charles Bullock rejected Dentons’ argument that the Swiss Verein structure under which the global firm is organized – with no sharing of revenues or pooling of profits among legally independent member firms – essentially established an “ethical screen” between Canadian and U.S. entities. His conclusion:

    Dentons holds itself out to the public as a unified global law firm in order to attract business, and Dentons’ continued representation in the face of a direct conflict would both contradict this public image and negatively impact the law profession as a whole.

    Collette Corser calls the decision “alarming” for other Swiss Verein law firms:

    The fact that Judge Bullock relied on the marketing perception rather than the independently run legal entities of the various Dentons branches may give other verein structured law firms pause in how they continue their operations. As Dentons recently issued a statement that it has an “acute” interest in undoing this disqualification order, we can expect to see more of this issue in the near future.

    So will the popularity of Swiss Vereins be short lived?  Not necessarily, writes Mark Cohen. and they may be suitable for some firms. But it makes the burden of managing conflicts more difficult:

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    Can software be a substitute for expert opinion?

    By National July 30 2015 30 July 2015

      Commenting on a recent Alberta Court of Appeal ruling turning on a construction dispute, Shaun Fluker considers the impact of electronically generated information on the law of evidence:

      Electronically generated information is not a new concept for the law – but I do think the capacity of the internet and ever-increasing reliance on computers is stretching these issues into new territory: Consider the proliferation of Facebook or Twitter to communicate, and how email has almost replaced traditional means of information delivery. These mediums have and will continue to require some adjustments to traditional ways in the law.

      One issue the Court looks at here is the reliability of mechanically generated records. A primary objective of the law on evidence is to screen out unreliable information. The Court observes that computer-generated records are generally admissible because of an inherent reliability, even though we are unable to precisely examine how the information is generated, and the person seeking to rely on this information does not have to prove the underlying processing technology works. The disputed evidence here consisted of survey data collected by electronic means and compiled in software, and the Court concludes this information easily passes the test for reliability (at paras 17 – 19).

      Photo licensed under Creative Commons by Paul L Dineen.

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      The letter of the contract

      By Kim Covert July 30 2015 30 July 2015

        If you’re fired and then immediately rehired, are you entitled to severance pay?

        That depends on the wording in your employment contract, according to an Ontario arbitrator who awarded severance pay to the former (and current) police chief and deputy police chief in Peterborough, Ont.

        Some people in the city are hopping mad about the award – estimates differ but some say it comes to a total of about $400,000, and the mayor was quoted as saying it was closer to $500,000.

        The issue came up when the city’s police service was de-amalgamated and then reconstituted under a new board. The chief and deputy chief both had their employment terminated on Dec. 31, 2014, and were rehired as of Jan. 1, 2015, with no interruption in benefits.

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        Statistics in the legal profession

        By National July 29 2015 29 July 2015

          Statisticians are often called upon to inform the credibility of evidence introduced in court, and as Eric Posner points out, the term “statistically significant” makes its way frequently into court opinions and law journals.  The obvious problem, in his view:

          Few lawyers and hardly any judges have statistical training or more than a rudimentary understanding of statistics. This is all too evident in judicial opinions. Law schools are just beginning to catch up–by hiring people with statistical training–but haven’t figure [sic] out a way to give students usable statistical knowledge.

          Tim Hartford, in a recent column, illustrates the devastating consequences poor handling of statistical tools can have on trials, particularly in criminal matters:

          Consider the awful case of Sally Clark. After her two sons each died in infancy, she was accused of their murder. The jury was told by an expert witness that the chance of both children in the same family dying of natural causes was 73 million to one against. That number may have weighed heavily on the jury when it convicted Clark in 1999.

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          Quebec's transparency law for the extractive sector

          By National July 29 2015 29 July 2015

            Ten days after the federal Extractive Sector Transparency Act came into force, imposing transparency measures and reporting obligations on the payments made make to foreign governments (as well as aboriginal groups) by the oil & gas and mining industry, the Quebec government tabled a similar bill (Bill 55). Erik Richer La Fleche and Roger Forget offer a few reasons why the province is planning to adopt a law with “no substantive differences between the two statutes,” beyond not wanting to cede power over its lawmaking in matters dealing with natural resources:

            Bill 55’s main objective is not to fight corruption in remote locales. Rather, the main purpose of Bill 55 is to facilitate the development in Quebec of oil, gas and mining projects. A rapidly aging Quebec population content with the status quo has tended in recent years to be hostile to new extractive and industrial projects. Indeed, it might be said that Quebec has a bad case of NIMBYism. What the Quebec government is trying to do is increase the social acceptability (social license) of projects by providing objective information to its population. Experience has shown that local populations properly informed of the tangible benefits offered by projects are far more likely to support them. The Quebec wind power industry is a case in point. Quebec is currently working on a social acceptability policy and Bill 55 is an essential building block of that policy.

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            Remaking Canada's judiciary

            By National July 28 2015 28 July 2015

              Léonid Sirota reacts to Sean Fine’s weekend article on how the Harper government is remaking the judiciary in Canada:

              The one disturbing fact that Mr. Fine presents is that some sitting judges actively lobby the government for promotions. Such lobbying, it seems to me, creates a real danger that the judge will try, whether consciously or not, to ingratiate himself with the government in his or her decisions. In other words, it creates an appearance of bias if not actual bias. Judges should strive to remain above such suspicions. The possibility of promotion is a weak spot in the arrangements protecting judicial independence, and judges themselves should not be exploiting it.

              There is nothing improper, however, in a government seeking to appoint judges with whose ideological leanings it is comfortable. Of course, judicial appointments should be merit-based ― in the sense that every person appointed to the bench should deserve to be, by virtue of his or her accomplishments and character. But that’s just threshold. Ideology, in my view, can properly be taken into account in deciding whom to appoint among the candidates who can get over that threshold. (It’s worth noting that, as Mr. Fine points out, the committees that screen applicants for judgeships rate many more as “recommended” ― and used to rate more as “highly recommended” when that was an option ― than there are positions available).


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              Alberta’s Russell Brown newest Supreme Court justice

              By Kim Covert July 28 2015 28 July 2015

                Prime Minister Stephen Harper announced his latest Supreme Court appointment late on Monday afternoon – Justice Russell Brown of the Alberta Court of Appeal.

                Brown, appointed without the Parliamentary approval process Harper instituted in 2006, replaces Justice Marshall Rothstein, who was Harper’s first high court appointee. Rothstein retires as of Aug. 31.

                He is the second of the nine judges from Western Canada – the other is Chief Justice Beverley McLachlin. Seven of the nine are Harper appointees.

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                The Ashley Madison affair and our age of digital insecurity

                By Michael Motala July 24 2015 24 July 2015

                  The Ashley Madison affair is a familiar tale these days. A large global corporation crippled by a data breach, and the public relations calamity sends shockwaves through the global press. Public trust in the company evaporates. Stocks will take a hit. It's off with the heads of a poor few corporate executives. If other well-publicized breaches are anything to go by (think of the Target fiasco), this could come with a serious price tag.

                  Hackers are imposing ever-growing costs on the state and market’s bottom line. Some estimate that the price is approximately one percent of GDP. Global corporations and banks are investing billions in protecting their information assets. The cyber-security industry is flourishing as a result. But Ashley Madison’s breach is noteworthy because of the social cost it carries —assailing marital lives and the values of constitutional democracy.

                  We live in the age of information insecurity. So what are we, the public, to make of our brave new digital world? Global corporations can be brought to their knees at the click of a button. Governments are shamed and blamed whenever data is disclosed. Julian Assange and Edward Snowden command some popular respect because of the purportedly noble and democratic object of their disclosures. But Ashley Madison’s assailants are criminals and terrorists by any rational definition. And it is terrifying because this is a sign of things to come.

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                  Legal expense insurance: Devil’s in the details

                  By Kim Covert July 23 2015 23 July 2015

                    Legal expense insurance is either a no-brainer or a head-scratcher, depending on your expectation of needing a lawyer based on the way you live your life in general – most law-abiding citizens with uncomplicated lives don’t think they’ll need legal help; on the other hand, according to the CBA report Reaching Equal Justice, most of us don’t recognize a legal issue when we see one.

                    The CBA passed a resolution in 2012 to work with legal expense insurance providers and government to promote the insurance as a way of increasing access to justice for the Canadian middle class, and wider adoption of LEI was one of the targets of our 2013 report. Canadians spend about $11 million a year on LEI, mainly in Quebec, the report says; in contrast, 40 per cent of all Europeans have it, as do 59 per cent of people in the U.K., and it’s actually mandatory in Sweden.

                    LEI is popular in Europe and provides basic access to legal assistance for people who can afford to buy the insurance, often in conjunction with home insurance or tenant insurance policies.

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                    Personal plight lawyers and the future of law

                    By National July 23 2015 23 July 2015

                      Noel Semple draws some interest conclusions from his research into how offshoring and technology will impact the work of personal plight lawyers – whose practices focus on helping people with legal issues against others individuals or organizations, as opposed to serving corporate clients. He argues that while technology is disrupting demand for traditional legal services, personal plight lawyers will be somewhat sheltered from that reality because of the nature of the work that they perform for unsophisticated clients. Typically, argues Semple, personal plight lawyers do less document review and have to work creatively to secure the complex and shifting interests of their clients, often in emotionally charged contexts. His bottom line:

                      Personal plight practice is relatively sheltered from the long-term off‐shoring and computerization threats to developed country lawyers. Compared to the corporate-client hemisphere, and compared to personal business work involving uncontested transactions and planning, personal plight legal practice involves many tasks that off-shore lawyers and computers will have difficulty performing in the foreseeable future. It would be foolhardy to predict that this lawyer work can never be off-shored or computerized. However, it can reasonably be said that during the careers of today's law students, these fields will be better sheltered from the bracing winds of offshoring and computerization than corporate and personal business work will be.

                      Still, Semple sees an opportunity to better serve an underserved market.

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                      Waiving the social contract: expatriates and the vote, Cont’d

                      By National July 22 2015 22 July 2015

                        Léonid Sirota picks apart the Ontario Court of Appeal ruling in Frank v. Canada affirming the constitutionality of provisions denying the right to vote to Canadians who have lived abroad for more than 5 years.  He offers six reasons why he hopes the case goes to the Supreme Court.  At the top of his list:

                        First, the majority’s attempt to tie the right to vote to a “social contract” in which one participates by obeying the laws of Canada and paying taxes to Canadian authorities fails because not only the constitutional text explicitly ties it to something else ― namely, citizenship ― but our political practice does too. Permanent residents too must obey the laws and pay taxes, but they lack the right to vote, no matter how long they have lived in the country. Many permanent residents will know plenty of relevant knowledge, and be affiliate in a myriad informal ways with their communities and even Canada as a whole, in addition to obeying the laws, which the majority says are the things on which “the right to vote is premised.” [91] Yet they lack this right. That’s because, contrary to the majority’s assertion, that right is premised on something else.

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                        Waiving the social contract: expatriates and the vote

                        By Kim Covert July 21 2015 21 July 2015

                          The Ontario Court of Appeal ruled on Monday in Frank v. Canada that Canadian expatriates who have lived more than five years abroad do not have the right to vote in Canadian elections.

                          Justice George Strathy wrote in the majority decision:

                          Permitting all non-resident citizens to vote would allow them to participate in making laws that affect Canadian residents on a daily basis, but have little to no practical consequence for their own daily lives. This would erode the social contract and undermine the legitimacy of the laws. The legislation is aimed at strengthening Canada’s system of government and is demonstrably justified in a free and democratic society. While the impugned legislation violates s. 3 of the Charter, it is saved by s. 1. Denying the right to vote to non-resident citizens whose absence exceeds five years is a reasonable limit on the Charter right.

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