Tim Wilbur is a senior editor and licensed lawyer with over ten years of experience in the legal media. He is responsible for the editorial of Canadian Lawyer and Findlaw.ca.
|Gregory Wylie says the budget is 'best described as fairly light on tax measures.'|
“Subject to transitional provisions,” Adrienne Oliver, a tax lawyer at Norton Rose Fulbright Canada in Toronto, explains, “for taxation years beginning on or after Mar. 22, 2017, the budget proposes to eliminate the ability of such designated professionals to elect to use billed-basis accounting. This will affect law firms that do not use the full accrual method of determining their income.”
Gregory Wylie, a tax lawyer at Osler Hoskin & Harcourt LLP in Toronto, also highlights the elimination of bill-based tax accounting for purposes of computing income, but says “the Budget is best described as fairly light on tax measures. There are no major policy announcements or changes.”
“The government continues to modestly pursue its agenda announced in the 2016 budget to focus on perceived fairness issues,” says Wylie, “including closing so-called loopholes, and targeting perceived inefficient or ineffective tax measures. In this regard, it is notable that Budget 2017 announces the government will in the next few months release a paper on tax planning using private corporations to reduce personal taxes. We may see future changes announced with the pending October 2017 federal government economic statement.”
Oliver describes this as a “a wait and see budget, reflective of the government’s concern about U.S. tax reform and the potential border adjustment tax, as well as its limited spending capacity.”
Other changes to the tax system include measures to:
• prevent the avoidance or deferral of income tax through the use of offsetting derivative positions in straddle transactions;
• extend to Registered Education Savings Plans and Registered Disability Savings Plans anti-avoidance rules similar to the ones applicable in connection with Tax-Free Savings Accounts and Registered Retirement Savings Plans,
• clarify the intended meaning of "factual control" under the Income Tax Act for the purpose of determining who has control of a corporation in order to prevent inappropriate access to supports such as the small business tax rate and the enhanced refundable 35-per-cent Scientific Research and Experimental Development Tax Credit for small businesses.
• prevent the avoidance of tax on income from the insurance of Canadian risks by extending the foreign-affiliate base erosion rules to foreign branches of Canadian life insurers.
• replace the Caregiver Credit, Infirm Dependant Credit and Family Caregiver Tax Credit with a single new credit — the Canada Caregiver Credit — non-refundable credit
• modify the tax treatment of successful oil and gas exploratory drilling to maintain their effectiveness.
• Increase excise duty rates on alcohol products by two per cent effective the day after Budget Day, 2017.
• amend the definition of a taxi business under the Excise Tax Act to level the playing field and ensure that ride-sharing businesses are subject to the same GST/HST rules as taxis.
For more information go to Taxnet Pro’s summary of the budget with analysis from tax lawyers from McCarthy Tétrault LLP.
Are law firms really innovating or is it all talk? That is a common debate in the profession these days and Blake Cassels & Graydon LLP has just launched a new challenge to move beyond the noise to what they hope will be real measurable innovation.
|Carla Swansburg’s team at Blakes is working with Law Made to develop a new product that they hope can be used by Blakes, clients and possibly other law firms.|
“There is a lot of … talk about how law firms aren’t really doing anything,” says Carla Swansburg, who is the director of practice innovation, pricing & knowledge at Blakes. “I think this is a really good example [of how] some law firms are actually … taking the steps to do stuff that is a little bit different, and a little innovative, but haven’t necessarily historically talked about it a lot.”
Swansburg’s team at Blakes is working with Law Made, a legal incubator in Toronto, to develop a new product that they hope can be used by Blakes, clients, and possibly licensed to other law firms.
Blakes went through an extensive internal discussion about what kind of end product they wanted to see with the challenge, to avoid the endless brainstorming with no tangible results that can occur in “hackathons” and other initiatives meant to spur innovation.
“We are kind of bypassing that route and saying we are going to go out there, we are going to frame the problem, invite solutions and then actually, hands on, roll up our sleeves, and work with the people who are building the tool, to create something that is not necessarily marketable but really gives us a tangible solution that we have helped design,” says Swansburg.
Blakes provides applicants with business requirements to ensure they know what is expected. Swansburg says the solution needs to be “…taking a pre-defined set of legislative provisions, so on a topic for example like consumer credit, and finding a way to automate the creation of reports around changes.”
The reports would need to track relationships between regulations and keep up to date by using a technology solution like machine learning, artificial intelligence or natural language processing to collect this information and provide clear, structured and actionable reporting on regulatory changes.
Blakes and Law Made will provide the winning entry with free legal advice from Blakes, mentoring from Law Made and a paid internship that includes work space and a stipend for up to six months.
Swansburg says she expects entries to come from the startup community, and that some initial applications have already come from Canada and the U.K., with some expressions of interest from the U.S., including a law school centre for law and technology.
There will be a two-step process, with the first round of applicants whittled down to around two to five finalists by a jury from Blakes, Law Made and client and industry participants.
Once the finalists are selected, they will make their pitch to a different jury and this will likely involve a beta test of the interface and an evaluation of the user experience.
They expect the winner to be notified in the late fall of 2017.
While Blakes will not necessarily have equity in the final product, Swansburg says that will depend on “what others come up with.”
The provincial governments in British Columbia and Alberta announced several judicial nominations this Tuesday, with the majority being women.
|Patricia Stark, a criminal defence lawyer who represents the mentally ill, was appointed as a judge at the Provincial Court of British Columbia.|
Provincial Court of British Columbia Chief Judge Thomas Crabtree announced seven new provincial court judges, including a family law lawyer, a civil litigator, three Crown counsel, a public prosecutor and a criminal defense lawyer. Four of the seven appointed judges are women.
In B.C., the provincial government appoints Provincial Court judges on the recommendation of the B.C. Judicial Council, which reviews applications, conduct interviews and approves candidates. When an opening is available, the chief judge sends the attorney general a list of approved candidates who are eligible for appointment to that region.
Patricia Stark, a criminal defence lawyer in Vancouver, will be assigned to the Fraser Region with resident chambers situated in Surrey, B.C. She joined the Ministry of Justice in 1992 and served as Crown counsel until 2002, and then became a sole practitioner. She has represented the mentally ill before the courts and the B.C. Review Board.
Cathaline Heinrichs, a family law sole practitioner in Kelowna, B.C., will be assigned to the Interior Region with resident chambers in Kelowna. Since 2000, Heinrichs has worked in adoption, child protection, advocacy for special needs children and family, and separation and divorce in both provincial and supreme courts.
Cassandra Malfair, a Crown counsel in Prince George, B.C., will be assigned to the northern region with resident chambers in Prince George. Malfair has experience in insolvency, constitutional, and regulatory cases in both securities and insurance. She held positions in two firms in private practice in Vancouver and Calgary before joining the Ministry of Justice in 2007.
Susan Mengering, a Crown counsel for the Ministry of Justice primarily in Prince George, is also assigned to the Northern Region with resident chambers in Prince George. Since 2003, Mengering has served as Crown counsel for the Ministry of Justice and initially prosecuted cases in Fort Ware/TsayKeh, Mackenzie, Valemount and McBride.
Brian Hutcheson, a litigator at Swift Datoo Law Corporation of Courtenay, B.C., will be assigned to the Vancouver Island Region with resident chambers in Courtenay. He has practised a mix of family and civil litigation, including mediation and negotiation.
Peter LaPrairie, general counsel for the Public Prosecution Service of Canada in Vancouver, will be assigned to the Fraser Region with resident chambers in Surrey, B.C.. He served as a federal prosecutor for more than 20 years.
Lynal Doerksen, administrative crown counsel in Cranbrook, B.C., will be assigned to the Interior Region with resident chambers in Cranbrook. He has practised in many areas of litigation, including family, employment, commercial, personal injury and criminal and has appeared before all levels of court in B.C. and Alberta.
Kathleen Ganley, Minister of Justice and Solicitor General in Alberta, announced the appointment of two new judges, including a family and human rights lawyer and a crown counsel, both of whom are women.
In Alberta, candidates for Provincial Court appointments are first screened by the Alberta Judicial Council and then interviewed by the Provincial Court Nominating Committee, which provides its recommendations to the minister of justice.
Julie Lloyd was appointed to Edmonton Provincial Court, Family and Youth. Lloyd practises family and human rights law, including advancing legal rights for members of Alberta’s LGBTQ community. She was legal counsel at Legal Aid Alberta’s Legal Services Centre in Edmonton, a member of the Canadian Human Rights Tribunal and an elected bencher of the Law Society of Alberta.
Michèle Collinson was appointed to Provincial Court, Edmonton Region. She worked at the Alberta Crown Prosecution Service, most recently serving as the co-ordinator of the High Risk Offenders Unit in Specialized Prosecutions. She has also served as an assistant chief crown prosecutor and lead counsel for the Criminal Justice Division of Alberta Justice and Solicitor General.
“Julie Lloyd and Michèle Collinson exemplify dedication to public service and the very best of Alberta’s legal community,” said Minister Ganley in a press release.
The Supreme Court has clarified when an appeal court should defer to the trier of fact in interpreting standard form contracts, which are commonly used in insurance policies. Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., released today, overturned an Alberta Court of Appeal decision that had found an insurance company was not required to cover the cost of replacing windows that had been scratched by cleaners on a construction site.
|Eugene Meehan represented the construction company that was denied insurance coverage.|
During construction, window cleaners had used improper tools and methods and ultimately the windows had to be replaced. The building’s owner, Station Lands, and the general contractor in charge of the construction project, Ledcor Construction, claimed the cost of replacing the windows against a builders’ risk insurance policy. The insurers denied coverage on the basis of an exclusion contained in the policy for the “cost of making good faulty workmanship.”
The disputed clause in the insurance contract excluded the “cost of making good faulty workmanship” but made an exception to that exclusion for “physical damage” that “results” from the faulty workmanship. Justice Wagner, writing for the majority, found that the exclusion clause should only cover the cost of recleaning the windows, but it did not exclude the scratched windows’ replacement cost. This restored the trial decision’s finding that the replacement was covered. The Alberta Court of Appeal had overturned the trial judge’s decision and declared that the damage to the building’s windows was excluded from coverage, as the damage was “physically or systematically connected” to the work the contractor had performed.
Eugene Meehan, a lawyer at Supreme Advocacy in Ottawa who represented Ledcor Construction at the Supreme Court, says the decision is a “welcome, positive and necessary clarification to an increasingly complex yet fundamental area of insurance — the interpretation of coverage, exclusion, exception clauses.”
A key legal finding in the decision examined the application of the SCC’s 2014 Sattva decision. In that decision, the top court limited the ability of parties to appeal contractual interpretation by stating that most contractual disputes are questions of mixed fact and law. However, Justice Wagner created an exception to Sattva in today’s decision, stating, “In my view, where an appeal involves the interpretation of a standard form contract, the interpretation at issue is of precedential value, and there is no meaningful factual matrix that is specific to the parties to assist the interpretation process, this interpretation is better characterized as a question of law subject to correctness review.”
Greg Tucker of Owen Bird in Vancouver, who represented the insurance companies, says although he is disappointed with how the court applied the faulty workmanship exclusion to his client’s situation, he agrees with the top court’s creation of an exception to Sattva for standard form contracts.
“In a standard form contract, for purposes of insuring, consistency of interpretation obviously is a key factor, for the benefit of both insurers and insured. It is important that interpretation of standard form language be treated as a question of law and subject to a correctness standard. I think it is a sound decision on that point,” said Tucker.
Nina Bombier, a partner at Lenczner Slaght Royce Smith Griffin LLP in Toronto, said in an e-mail that since the decision widens the scope of which contractual disputes can be appealed, it may result in more insurance litigation in the short term.
“However, as appellate interpretation of standard form contracts will have greater precedential value, this should eventually reduce litigation and limit future contractual disputes around the standard form clauses,” said Bombier.
Borden Ladner Gervais LLP has nabbed the former general counsel at CBC as strategic adviser and counsel in its securities and capital markets group.
|Former general counsel of CBC, Maryse Bertrand, has joined BLG.|
Maryse Bertrand was general counsel and vice president, real estate services, legal services and corporate secretary at CBC/Radio-Canada from 2009 to 2015 and an M&A partner at Davies Ward Phillips & Vineberg LLP for 20 years before that.
Bertrand says that she was in discussions with a number of law firms after having just completed a Master of Science in risk management at New York University’s Leonard N. Stern School of Business this spring.
“It is all about the clientele that you have and the nature of the work that you have and BLG was the best fit,” she says.
She is looking to apply her knowledge of M&A that she acquired while in private practice in her new role, while also drawing on her experience in risk management and governance from the CBC.
“As general counsel at the CBC, I was very much in charge of risk management. I handled a fair amount of matters.” One of the high-profile matters Bertrand dealt with at the CBC was the Jian Ghomeshi scandal, as well as “a couple of less high-profile ones that were just as important for the organization.
“I enjoyed my time at the CBC, I spent almost six years there, so I really really enjoyed that. It gave me a whole lot of respect for public service. A lot of dedicated people who work very very hard for, compared to the private sector, less money, and sometimes frankly less recognition, so there are a lot of things to be done, there are a lot of challenges, and I like that.”
Bertrand left the CBC last year to complete her master’s degree, and having advised on governance while sitting on a number of company boards in her time at the CBC, she says she “decided that I would pursue that on a full-time basis as opposed to doing that part-time.”
While at the CBC, Bertrand was responsible for three business units: real estate and health, safety and environment portfolios of CBC/Radio-Canada in Canada and abroad, the legal department with offices in Montréal, Toronto and Ottawa and the Corporate Secretariat. She chaired the CBC’s national crisis committee and managed compliance with access to information and privacy laws.
In fact, managing crisis seems to be a theme throughout her career. Bertrand says the financial crisis was partly what prompted her to leave her private M&A practice in 2009 at Davies to join the CBC, as she guessed the work would not be as interesting in the short term.
“In terms of M&A work, you can only imagine that it was pretty boring [post-crisis] as compared to the previous 10, 15 years that had been absolutely amazing. My assessment at the time, which I think was probably right on, was that it would take many many years for things to actually come back to any sort of interesting level.”
With her experience at the CBC managing crisis and her masters in risk management, she anticipates advising BLG clients on governance as well as traditional M&A.
Bertrand says risk management is a new growth area.
“From a governance point of view, being a corporate director is getting professionalized, if I can put it that way. Shareholders, institutional investors, are asking more of corporate directors, quite rightfully [so]. They are asking them to be more proficient, to focus more on a number of more strategic areas, compensation being one of them, but risk is also very much at the forefront since the [financial] crisis in particular.”
“It is a pleasure to welcome Maryse to the firm,” said Sean Weir, BLG’s national managing partner and CEO, in a press release. “She has successfully advised private and public companies on a broad range of corporate issues with outstanding commitment to client service. Her impressive track record is an inspiration for senior leadership and rising stars.”
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