Our Take on Things

There’s an interesting news item making its way around today about a lawsuit against the City of Toronto and councilor Adam Vaughan. The suit alleges, among other things (or “inter alia”, as they taught us in law school) that the City and the councilor went overboard in applying municipal bylaws as against a downtown nightclub, in an effort to force it out of business.

The suit in essence, contends that the nightclub was singled out, and as a result received repeated visits from Police and bylaw enforcement officers, to the point of harassment. However, the particulars also seem to indicate that the nightclub acknowledges that it did not have the appropriate operating licenses in place.

Our firm has represented various types of businesses in licensing and compliance matters with the City, and luckily we’ve never had to resort to this sort of litigation to try to save them. That said, licensing matters are often complex – incredibly complex when dealing with historical issues, as is often the case by the time legal counsel gets involved.

In addition to the legal complexities of the interwoven federal, provincial and municipal legislation, there are other fields entirely that must be considered. For example, we regularly retain experts on planning and zoning issues. These experts regularly deal with the data gathering process that underlies everything from the making of a City Plan to minor variance applications. Together, we work with the City to understand the context of a business, the applicable licensing environment, the community impact of the business, and usually we find that there’s a way through an impasse.

It’s hard to tell if all attempts to work within the system were exhausted in the current litigation, but it’s unfortunate that it has gotten to this point. Hopefully there are still opportunities for a negotiated settlement that will see a balance between the needs of the community and the needs of the local business.

Scott R. Young

In the past few months I have had the privilege of being consulted by many students considering a career as a lawyer. These students come from different places in their education, high school, undergraduate degree and even a couple studying outside of Canada. Many want to know the nuts and bolts process of becoming a lawyer, but at the end of the day, they all want to answer the question “should I become a lawyer”.

I have no right to pass judgment on anyone becoming a lawyer, however, that does not stop me from doing so and I will here. These are my personal opinions, do not take them as Gospel, you might be the exception to the rule.

If you need to take a course to prepare for the LSAT or need to write the LSAT more than once, you should not become a lawyer. The LSAT is meant to test your aptitude for a career in law, if you want to know if you were meant for this you should be able to get a high mark first time, with minimal preparation.

If you are going to law school because you finished an undergraduate degree and flipped a coin between Teacher’s College and Law School, do not become a lawyer. In fact, please don’t go to law school, you’re taking a seat away from someone who should be there.

If you are hoping to meet that “special someone” and live happily ever after on their lawyer income while you lounge by the pool, please do not go to law school. Once again, you’re taking a seat away from someone who wants to be there.

You should consider becoming a lawyer if you enjoy public speaking, reading and creating sound arguments.

You should consider becoming a lawyer if you enjoy reading and writing long documents with technical meanings.

You should become a lawyer if you can afford the $ 75 000.00 law school tuition. If you cannot, you’d better be sure you are going to practice in an area of law that pays well: criminal lawyers often start at $ 40 000.00 per year or less.

You should become a lawyer if you have researched what the career involves, have the ability to study law (both academically and financially) and have a passion for the field.

Never become a lawyer (or anything else) because someone is expecting you to – life is too short and this career is too demanding.

I love being a trial lawyer. I knew I wanted this career from age 16 on, but I am the minority. If you believe this may be the career for you I hope you enjoy it as much as I do.

Inga B. Andriessen JD

During the summer months, with people on vacation or otherwise disinclined to come into the office, we face a variety of questions in the area of employment law.

One issue that keeps coming up is that of smartphone use. We’ve dealt with privacy and security issues as they relate to mobile devices, but we haven’t talked about smartphone use as an overtime issue.

While there are many exemptions (such as certain categories of work and certain remuneration structures), in some cases, employees who are expected to respond to telephone messages or e-mail while away from the office, are entitled to remuneration for that working time.

While many critics argue that given the amount of time at the office spent playing Angry Birds or surfing Facebook, the trade-offs should cancel each other out – the law doesn’t see it that way.

If your employees are expected to work outside of office hours and your contracts or policies don’t cover this scenario, then you should be in contact with your legal advisor before you face a claim from an unhappy employee – or one of those fun Ministry of Labour investigations.

Scott R. Young

It’s summertime and a lot of businesses (particularly smaller ones) take this time of year to slow down a little; senior staff like to take some well-deserved time off, people are generally harder to get ahold of, and this is the time that a lot of reorganization work is done. One thing in particular that we find happening a lot in summer months is office moving.

In addition to the headaches associated with the physical move (our last office move was less than 100 meters and still took months to plan), there are some legal compliance issues to keep in mind.

A Notice of Change must be filed with the Ministry of Government services within 15 days of the move. The notice must be accurate with respect to all information about the corporation, and there are significant penalties under the Corporations Information Act for getting it wrong. This needs to be prompt and perfect.

If the corporation is moving within the municipality, then a resolution of the Directors has to be passed and recorded in the corporation’s minute book. If the corporation is moving outside of the municipality, then a special resolution of the shareholders needs to be passed. Depending on the composition of your business, this could require a special meeting to be held. Failure to get this right could result in penalties under the Business Corporations Act.

Summertime – where the livin’ is easy, but the compliance requirements never sleep.

Scott R. Young

Our firm recently was successful in arguing against the appeal of a decision that granted our client Judgment against the officers & directors of a company we had obtained a previous Judgment against, as well as all the other corporations they were using to carry on their business.

For those interested in the complete text, please contact me via email for the citation.

In plain English (as opposed to lawyer speak) the case is important because it found that a debtor corporation cannot simply close its doors because someone has a Judgment against it.

This is not to say that a corporation cannot make an assignment into Bankrutpcy: that is always possible.

Many smaller companies, “Mom and Pop” companies if you will, often try to avoid the expense of a Trustee and simply close their doors, open a new company, and carry on as if nothing has changed. The case says you cannot do that if doing so would defeat the reasonable expectation of a creditor that you will continue on business to pay off the Judgment after one is obtained against you.

The case also found the officers and directors personally liable, thereby exposing their personal assets to seizure, as they were found to be the directing minds who directly benefited from the movement of assets to themselves and their other companies.

The decision is an important win for people concerned that a small company may simply open its doors under a new name if a Judgment is obtained against it. While you cannot stop someone from doing this, you can ultimately obtain a Judgment against them that may target all of their assets and encourage them to pay the Judgment.

Inga B. Andriessen JD

How the mighty has fallen – or at least received its comeuppance.

By now, you will have heard of this public relations and legal disaster, also known as the Facebook IPO.

The great gatherer of personal information and annoying games (which thankfully no longer remind me of how “friends” are succeeding on their vegetable crops) decided enough money was not being made from advertisers, so why not make more money from a share offering.

The feeding frenzy that followed reminded me of piranhas in South America devouring some poor animal that had wandered too far into the river. It also reminded me of the price once garnered for tulips in the Netherlands, where for a time they were worth more than gold. Remember cabbage patch dolls? There is a theme here – demand outweighing supply, desire outweighing common sense and instinct.

But there were warnings in advance regarding the IPO. Even the Toronto Star (not known as the first-stop for financial news) was putting out articles from financial experts who were advising against purchasing on the opening day of trading. We now discover that select investors were warned in advance of revenue issues that resulted in the stock valuation being too high, yet the IPO was not delayed and that information was not (allegedly) properly disseminated.

Should it have come as a surprise that those not in the know (or who did not do their due diligence) are now alleging fraud and that class action lawsuits are in the works? No.

This mess could have been avoided with a little common sense (and input from some good lawyers ). Which begs the question, why didn’t Facebook call on us for some advice? The response from our corporate and litigation gurus would have been simple: disclose or delay.

Paul H. Voorn, Associate
Andriessen & Associates, Prof. Corp.

Do you (without looking it up) know the percentage of your income that you would be required to pay as child support if you found yourself in a situation that you have to support a child? Neither do I and that’s a good thing, both from a personal perspective and a professional one.

Our firm is a Business Law Firm. We do not handle family, criminal, personal injury or anything that is not business related.

Business law is too complicated these days for a law firm to dabble – our clients benefit from our focused experience and the able to answer questions accurately, without a lot of research on “routine business issues” because we deal with these issues all the time.

I shudder when I hear new lawyers and frankly, even older lawyers, boast about practicing “Door Law”. What kind of law? That is the kind where, whatever problem walks through your door, you handle it.

If you call our firm seeking assistance in an area of law that is not Business Law, please do not be offended when we refer you to a lawyer who does handle that type of law. We know what we’re good at and it’s Business Law.

Inga B. Andriessen JD

The news this week has been of health care cuts and reductions in spending in that sector – there is good reason for that. The average person needs health care and it impacts on them directly.

Cuts can seep into government over time and produce a global result of utter failure which kind of “snuck up on us”. This is the situation we are now facing in Ontario in the Civil Law system.

As a reader of this blog, you should be aware that our firm is a Business Law firm.

We are in Court weekly enforcing and defending the rights of businesses in the Ontario Courts. We have noticed cuts over time that have had little initial impact, but we anticipated would ultimately have a big impact. Well, that time is now.

Here are a few real life examples from the week that was in our firm:

1. The Sheriffs in Ontario take at least 6 weeks after receiving a Court Order to repossess an item to act on it.

Why? Because the Government is not appointing new Sheriffs, so as they quit/retire there are fewer of them.

The rational solution would be to allow private, Government Licenced Bailiffs to fill that gap, however, the Government Ministry responsible for Bailiffs is actively campaigning to prevent Bailiffs from enforcing Court Orders. Judges can Order a private Bailiff to repossess an item, however, the Ministry will pull their Licence if they actually do what a Judge says they can.

Why should you care? If you are a business, this is slowing down your ability to re-take possession of items that are not being paid for and are still in possession of a debtor.

If you are “the average Jane/Joe” your costs to buy/lease/rent items will be increasing and the credit requirements will tighten further as companies that extend credit have to factor in the delays in the cost of financing.

2. Brampton Ontario will not allow anyone to file a Motion Without Notice to be spoken to ahead of time. This leaves two options:

a. Send a lawyer down on the day they want to speak to the motion to sit all day and hope they are reached on the list;

b. File the motion over the counter and wait to get it back.

Option a sounds more expensive, doesn’t it? That could be a full day for a lawyer in Court. However, we recently used option b to obtain Judgment.

We filed our Judgment materials the last week of March, 2012. A Judge signed the Order on March 30, 2012. Brampton Court Clerks only entered the Judgment in their system on May 1, 2012 – six weeks after we received Judgment, and to be clear, 2 weeks after the Appeal period of that Judgment expired.

Better still, the entered Order was put in the “to be picked up pile” on May 10, 2012, a further delay.

Why should you care? If you have a proceeding in Brampton you have the “Sophie’s Choice” of increased lawyer costs or increased delay – this is Justice?

Why is no newspaper writing about this crisis? To believe that these delays only impact companies is foolish – delays and increased costs are ultimately passed on to everyone.

We need to have a real conversation about adequately funding our Civil Justice System – because when it breaks down, we have anarchy.

I’ve seen news footage of anarchy: it isn’t pretty.

Inga B. Andriessen, JD

I was watching a documentary about Warren Buffet the other day and at one point they were reviewing the details of one of his more recent financial deals. They noted that in his purchase of some multimillion dollar business or other, he did not retain legal counsel to conduct due diligence of any kind nor to draft the purchase agreement. That raises an intesting question about the value of legal advice on a business deal.

I have read several books on Buffet and watched countless documentaries on the man; he’s a fascinating portrait of success and certainly only a fool would suggest that his business principles shouldn’t be adhered to – there are even a few MBA programs that seek to mimic his investing philosophy. The conclusion for some may be that legal advice may not be needed on a large acquisition – I’ve certainly had clients who believe that – some have even concluded their own large deals without legal assistance of any kind. I think that’s a huge mistake.

What the documentary didn’t cover in much detail was the fact that when Buffet did the particular deal in question, he’d had more than a half century of business experience at the highest levels. He had done hundreds of deals, had personally orchestrated dozens of major business purchases, had been intimately involved with the due diligence and legal negotiations on almost all of them and had spent years watching the target company in question with the eyes of a professional business analyst. Few business people, or even business lawyers, have the kind of eye for a deal that Warren Buffet has.

I think the takeway lesson should be that when you reach Warren Buffet’s level of sophistication, you can decide whether or not to involve legal counsel in a deal of any significant size. But until then, I firmly believe that only a fool would enter into any major business agreement without getting legal advice on it.

Scott R. Young