LW1230 - Business Law
Winter 2016

The Business Law Course:

In this course we will examine the fundamental principles of the Canadian legal system. We will explore the Canadian legal system, torts, contracts, business law, employment law and international business law. We will have the opportunity to apply and research various business law cases.

Topics Covered:
  1. The Law and the Canadian Legal System
  2. The Law of Torts
  3. The Law of Contracts
  4. Business Law
  5. Employment Law
  6. International Business Law and Emerging Trends


Yates, R.A., Legal Fundamentals in Canada ISBN- ISBN-10: 013291087X • ISBN-13: 9780132910873

CanLII legal website: https://www.canlii.org/en/nl/nlpc/

How you will be evaluated:

Application Assignment 1
In groups of 3 or less you will be responsible for analysing and handing in a one page case assessment that references the points of law, and precedent cases relevant to the case that supports your analysis and decision

Case 1 – Due Feb 12

A backhoe operator owned by Digger Contracting Inc. was involved in trenching for a water line along a town sidewalk. In the process of moving a bucket of loose gravel from the excavation, the backhoe driver accidentally came into contact with a power line owned by the power company. The electrified line fell to the sidewalk and struck a pedestrian who was observing the trenching. The pedestrian received severe burns and required extensive hospitalization and re-constructive surgery. Later the pedestrian brought legal proceedings against Digger Construction Inc. for injuries suffered and 6 months lost wages while hospitalized.

Outline the various steps the parties to the action would take to bring the case to trial, the trial process and the grounds that the case would be argued.
Application Assignment 2
In groups of 3 or less you will be responsible for analysing and handing in a one page case assessment that references the points of law relevant to the case that supports your analysis and decision

Case 2 – Due Feb 26

Nico owned a strip mall development along a busy suburban roadway. One of her tenants had operated a small shop selling new and used sewing machines. Over a period of six months, it became apparent to Nico that that tenant was in trouble. Originally the rent was paid in full and on time. Then the tenant paid in full, but late. Then the payment was short and late and finally in the past 2 months the rent had not been paid at all.

Nico, realizing that things had gone from bad to worse took action. She called the locksmith and had him change the locks on the store’s doors. Nico moved the inventory of twenty sewing machines into the back storage room, cleared the stock from the shelves that were visible from the front window. She placed a “For Rent” sign in the window, set the alarm and then left. When she returned the next morning, she found that the door lock had been smashed, the alarm system disarmed and the inventory was gone.

Discuss the rights, responsibilities and defences the parties may raise in this situation
Application Assignment 3
In groups of 3 or less you will be responsible for analysing and handing in a one page case assessment that references the points of law relevant to the case that supports your analysis and decision

Case 3 - Contract:
National Money Mart v. Tazmania Auto Sales
The plaintiff sued Tazmania for the amount of five cheques that were dishonoured upon presentation. It also sued Bannerman, a minor, for the amount of two of these cheques. Bannerman had endorsed the cheques and received their face value, less the fee charged. He had immediately given the funds to his mother and step-father.
Assuming that the law relating to the capacity to incur liability as an endorser of a cheque is the same as the law relating to the capacity to contract, will the plaintiff succeed in its claim against Bannerman? Be sure to discuss all the legal reasons in your answer.

Due: March 11
Application Assignment 4
In groups of 3 or less you will be responsible for analysing and handing in a one page case assessment that references the points of law relevant to the case that supports your analysis and decision

Case 4 – Factors affecting Contracts
RBC v. Gill (1988)
The younger Mr. Gill was fluent in English and a sophisticated businessman. He had worked at the Credit Union for a number of years and managed his father’s berry farm. To take advantage of a business opportunity, he arranged with the Royal Bank to borrow $87,000. During the negotiations, it became clear that he could get a more favourable rate of interest if his father guaranteed the loan. In fact the son had done a considerable amount of banking on behalf of his father, who was a customer at the same bank. The older Gill could not read, write or speak English and relied on his son to do all of his business dealings. The documents were prepared and the son brought his father to the bank to sign. At no time did he explain to his father what exactly he was signing. The evidence is clear that the father did not know he had signed a personal guarantee. The son defaulted on the loan. And the bank turned to the father for payment. Should Gill senior be liable for the loan? Discuss the precautions that the bank should have taken?

Due: March 11
Application Assignment 5
In groups of 3 or less you will be responsible for analysing and handing in a one page case assessment that references the points of law relevant to the case that supports your analysis and decision

Case 5 - Employment:
McKee v. Reid's Heritage Homes Ltd., 2009 ONCA 916 (CanLII)
On January 8, 1997, Orin Reid, the owner and directing mind of RHH, and McKee both signed an agreement that Reid wrote by hand entitled “Sales + Advertising Agreement”. McKee signed it on behalf of her business style, Nu Home Consultant Services
The Agreement provided that RHH would supply approximately 69 homes in Guelph for McKee to advertise and sell, for which McKee would charge a fee of $2,500 for each home that she sold.
The Agreement included something of an exclusivity clause, providing that “RHH will have sole use of [Nu Home] services unless RHH agrees to allow [Nu Home] the right to sell for another company that is controlled by Orin Reid” and it then listed two other companies under Orin Reid’s control, but also added “or a company that could be formed in the future.”
Finally, McKee requested, and the Agreement included, a termination provision: “Either party can terminate this agreement for any reason with giving the other party 30 days notice.”
There was no precise, explicit evidence on how quickly McKee sold the 69 homes, but it was probably very quickly in 1987 because her reported income for 1987 was $449,300, whereas the 69 homes at $2,500 per home would have provided only $172,500. After the first 69, RHH continued to provide homes for McKee to sell, but RHH hired someone else to handle the advertising aspect and paid McKee $1,500 per home sold instead.
Around the same time, RHH also began supplying the necessary stationery and forms for selling homes to McKee and RHH gave her the title “Sales Manager”, though RHH paid her through her corporation, whose name changed to Bribet Holdings Inc. (“Bribet”) in 1988. McKee became very busy with work for RHH and over time she hired, trained, and managed her own subagents with whom she split her commissions on their sales, without intervention, direction, or interference from RHH. At all times, McKee both invoiced RHH and paid her subagents through Bribet. McKee testified that Reid “pretty well left me on my own to do what I was supposed to do.”
The working relationship continued in this way. In 2000, Reid died and his son-in-law, Tim Blevins, succeeded him, but the relationship continued. However, in 2004, Blevins hired Doug Sider as Corporate Sales Manager and decided to restructure RHH’s entire sales force – which at that time consisted of a number of different contracted real estate agents, dependent contractors, and in-house employees – so that each commissioned agent would report directly to Sider.
Blevins told McKee on January 10, 2005, that she and her subagents would have to work for RHH as “direct employees”. As part of their discussions in January toward negotiating for McKee to adjust to RHH’s new structure, McKee and Blevins discussed a 100-lot assurance to McKee for the following two years. McKee, who was 64 years old, decided that she would agree on these terms. Blevins referred McKee to Sider to work out the details, as McKee wanted to put the agreement in writing.
McKee met with Sider on February 4, 2005 to finalize a contract, but Sider repudiated McKee’s and Blevins’ understanding, refusing to agree to the 100 lots per year guarantee (having never spoken with Blevins about it). Blevins wrote a letter to McKee on February 11, offering only a standard form employee contract with a 14-day notice period and “first pick” of one phase of any project in Guelph. In this same letter, Blevins opined that McKee’s subagents performed badly and this might have something to do with “how much [McKee was] taking off the top of every deal.” McKee rejected this offer. She also rejected Blevins’ March 3 offer of a six-month engagement whereby she could sell in her choice of one of two subdivisions.
McKee testified that she rejected the time-limited offer because she felt that at her age she would do better to look for non-time-limited employment. Further, the “animosity” in the February 11 letter made her feel “uncomfortable”. However, she also testified that she would have returned to work for RHH if they had officially offered the January plan guaranteeing 100 lots in writing. McKee tried and failed to get a real estate agent licence because she found studying difficult at her age. In 2006, she sold new homes for another builder, but earned only $45,000.
McKee sued RHH for wrongful dismissal.
Due April 8
Application Assignment 6
In groups of 3 or less you will be responsible for analysing and handing in a one page case assessment that references the points of law relevant to the case that supports your analysis and decision

Case 6 – Red Burrito Ltd. v. Hussain, 2007 BCSC 1277
Red Burrito Ltd. (“Red Burrito”) operates four Mexican food restaurants in the Greater Vancouver area. On February 24, 2006, Red Burrito entered into a “Letter of Understanding” with the defendant Shahid Hussain to convert a grocery business operated by Hussain and the second defendant, Muhammad Zubair Hingora (“Papaya Market”), into a fifth Red Burrito restaurant in Vancouver. The Letter of Understanding provided the restaurant would be owned and operated by a new holding company (“Newco”), with Hussein and Red Burrito as equal shareholders. Red Burrito was to be the managing partner and fund the remodelling and start-up costs of the restaurant. Hussein was to be the on-site manager and oversee the renovations to the premises. He was also to arrange for the assignment of Papaya Market’s leasehold interest to Newco. The lease had a remaining term of four years and a five year option to renew. The incorporation of Newco and the assignment of the lease were never completed. Despite those omissions, the restaurant opened on June 29, 2006. Problems arose between the parties and on or about August 8, 2006, Hussain locked out the principals of Red Burrito. Hussein continues to operate the restaurant with the assistance of his former partner Hingora.
Red Burrito sued and sought the following relief: (i) a declaration that Red Burrito and Hussein operated the Mexican restaurant as a partnership; (ii) that the leasehold interest in the premises is an asset of the partnership; (iii) a declaration dissolving the partnership; (iv) an order that the affairs of the partnership be wound up and the partnership assets be sold; (v) an order appointing a receiver without bond or security to conduct the sale of the assets and prepare an accounting, with Red Burrito having a right of first refusal on the sale; and, (vi) an order for costs.
Due: April 8
Midterm 1
The Midterm exams will be an invigilated 2 hour exam.
Midterm 2
The Midterm exams will be an invigilated 2 hour exam.
Final Exam
The Final exam will be an invigilated 2 hour exam.

Calendar & Course Outline

Week of

Jan 4
Overview, Expectations and Syllabus Review

Welcome to The Canadian Legal System – 1.0 The Law and the Canadian Legal System

In this unit we will: Define law, business law, common law, statute law and administrative law, Identify and discuss the sources of law in Canada, Describe the Canadian constitution and its impact upon Canadian law, Identify and discuss the classifications of law & Explain the structure of the Canadian judicial system (courts)

Jan 11
Tort Law in Canada - 2.0 The Law of Torts

In this unit we will: Define tort and tort-feasor, Describe intentional torts, (Define intentional torts, defamation, libel, slander, deceit, Identify and discuss the various types of intentional torts (person)), Explain the tort of negligence, Define negligence, vicarious liability, negligent misrepresentation, Describe causation and the duty of care and foreseeability, Explain torts arising from the use of property (Define occupier , Distinguish between an invitee, licensee, and trespasser), Explain occupier’s liability, Describe the tort of nuisance and trespass, Identify and discuss the common tort defenses and tort remedies & Analyze tort law case applications


Jan 18
The Legal Contract - 3.0 The Law of Contracts

In this unit we will: Define contract, offer, acceptance and consideration, Identify and discuss the essential elements of a valid contract (Explain offer and acceptance, Examine the element of consideration in a contract, Review the legal capacity to contract and the requirement of legality), Explain the requirement of writing under the statute of frauds or similar statutory regulations/laws, Describe the content of a contract: Expressed and Implied terms (Explain conditional agreements, limitations of liability clauses and exemption clauses), Identify the forms of a contract (Explain parol evidence rule), Explain the concept of privity of contract, & Analyze contract law case applications

  • Read Chapter 3 Formation of Contracts


Jan 25
The Legal Contract - 3.0 The Law of Contracts cont…

In this unit we will: Explain Mistake, Misrepresentation, termination and enforcement of contract (Explain the termination of a contract by performance, agreement and frustration, Identify and discuss the remedies for breach of contract), Examine the legislation affecting contracts

Read Chapter 4 Enforcing Contractual Obligations

Feb 1

Feb 8
Exam 1 - Covering Chapters 1, 2 & 3

Feb 15
The Legal Contract - 4.0 Business Law

In this unit we will: Review legislation pertaining to: Sale of Goods, Consumer Protection, Secured Transactions & Bankruptcy

  • Read Chapter 5 Legislation in the Marketplace

NL - Sale of Goods Act

Cdn - The Competition Act
Bankruptcy and Insolvency Act

Feb 22
Employment - 5.0 Employment Law

In this unit we will: Examine the law of agency (Define agency, agent and principal), Explain how agency relationships are created (Agreement, Estoppel, Ratification), Describe the duties of the agent and principal, Distinguish between employee and independent contractor, Explain vicarious liability and negligent hiring, Describe elements of an employment contract (Explain offer and acceptance, Distinguish between expressed and implied terms, Identify the contents/terms of an employment contract), Describe the labour legislation impacting employment contracts, Examine terminating the employment relationship, Distinguish between dismissals for just cause, dismissals for notice, constructive dismissals, and wrongful dismissals, Explain the damages for wrongful dismissal & Analyze employment law case applications

March 1
The Legal Contract - 4.0 Business Law
In this unit we will: Review the law of business relationships, Distinguish between sole proprietorship, franchises, partnership and corporation, Examine the law of partnership and corporation (incorporation)
Compare and contrast the various forms of business ownership

Read Chapter 7 Methods of Carrying on Business

March 8Exam 2 - Covering Chapters 5 & 6
March 15
The Legal Contract - 4.0 Business Law cont…* Read Chapter 8 Property
March 22
March 29
6.0 International Business Law and Emerging Trends
In this unit we will: Identify and briefly discuss the laws/regulations that affect Canadians when doing business internationally, Explore international trading relationships, Examine the emerging trends in Canadian business law (topics will be dependent upon the current environmental issues but could include: privacy legislation, environmental law, technology regulations, and insider trading)
  • Read Chapter 9 Ideas and Information
  • Read Chapter 10 Electronic Commerce and International Trade

April 6

April 13

April 20
Final Exam (M/C – Multiple Choice/Short Answer Comprehensive)

Online Resources :

Powerpoint Notes