Litigation

Limitation Periods applicable to the Environmental Management Act

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Limitation Periods applicable to the Environmental Management Act 1 Velletta Lawyers Victoria BC

British Columbia’s Environmental Management Act sets out a comprehensive scheme with respect to the remediation of contaminated sites.  Central to that scheme is section 47 of the Act, which permits a party who has incurred the cost of remediating a site to bring a court action to recover the costs of remediation.  In a typical Environmental Management Act action, the party who has incurred the cost will seek contribution from the property’s previous owners and operators.  Even though the mechanisms in the Act are designed around the principle of “polluter pays”, the provisions of the Act make it difficult for parties who have owned or operated a site to escape liability, as the burden of proof is on those parties to show that they fall within one of the Act’s limited exceptions found in section 46 of the Act.  As a result, actions under the Act can often involve parties that have had no involvement with the property for decades.  As a result, a frequent question asked by parties finding themselves in such a dispute is whether or not the BC Limitation Act applies, or whether there are any time limits associated with bringing such a claim.

Although the Act does apply retroactively in the sense that all previous owners and operators the property can be found liable for the cleanup, a plaintiff does not have an indefinite time in which to bring their action.  In First National Properties Ltd. v. Northland Road Services Ltd., 2008 BCSC 569, the court confirmed that the BC Limitation Act does apply to remediation claims pursuant to the Environmental Management Act.  In that case, the court found that the limitation clock started running once the Plaintiff was aware of the cost to remediate.  In J.I. Properties Inc. v. PPG Architectural Coatings Canada Inc., 2014 BCSC 1619, the court confirmed that the six year limitation pursuant to the 1996 Limitation Act was applicable.

Prior to the passage of the 2012 Limitation Act, it appeared that an amendment would be made to the Environmental Management Act to the effect that an action could be brought at any time. However, when that legislation was passed, no consequential amendments were made to the Environmental Management Act, so it remains at this time that the Limitation Act applies.  Thus, a plaintiff who incurs remediation costs ought to bring their cost recovery action swiftly, as the Act’s two year limit will likely come into play.  Further, it remains to be considered in a future case what effect, if any, the discoverability provisions of the new Limitation Act have in respect of a cost recovery claim.

About the Author:

Limitation Periods applicable to the Environmental Management Act 2 Velletta Lawyers Victoria BC

W. Eric Pedersen is a lawyer practicing in the civil litigation department at Velletta & Company. Mr. Pedersen has worked with the civil litigation department to achieve successful outcomes for individuals and businesses, appearing in Provincial Court, Supreme Court, and the British Columbia Court of Appeal.  Find out more about Eric by clicking HERE.

The Do’s and Do Not’s for Examinations for Discovery

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An examination for discovery is a critical part of any personal injury or civil litigation case in British Columbia’s Supreme Court. Generally, in a civil or personal injury case, each side has an opportunity to examine the opposing party. If the opposing party is a corporation, partnership, or other non-human entity, that party’s representative will be examined on their behalf. Examinations take place in a boardroom at the offices of specialized reporting companies that provide the space for the examination and a trained court reporter who produces a written transcript of everything said during the examination.

 

Examinations for discovery are very important because they allow each side to ask questions, gather information, and pin down the story of the other side. You can explore contradictions in the other side’s version of the facts. You can also find out about any records, correspondence, or other documents in the possession of the other side, and request that they disclose these documents if they are relevant. You will likely have a better idea of the strength and weaknesses of your case after both sides have conducted examinations for discovery. This helps you prepare for trial, and can even help the parties reach a settlement because they are better able to predict the outcome of the trial and more likely to compromise if they can foresee a low likelihood of success at trial.

 

What happens at an examination for Discovery?

 

Many people are understandably nervous about attending an examination for discovery, and it helps to know what to expect. The examinations take place in a boardroom around a big table. The court reporter usually sits at the head of the table between the two sides, and takes notes and marks exhibits throughout the examination. The party who is being examined will sit across from the opposing party’s lawyer who is examining them. Anyone who is a party to the litigation is permitted to attend the examinations, and usually, the party whose lawyer is conducting the examination will be there, sitting next to their lawyer. This is helpful because that party can take notes while their lawyer is conducting the examination, and can even discuss the examination with their lawyer during a break if they think of other questions that need to be asked or contradictions that should be explored.

 

If you are being examined and have a lawyer, your lawyer will attend with you to represent you and object to any questions that are irrelevant, or otherwise improper. While you are under examination, you cannot discuss the case with your lawyer, even during the lunch break.

 

The lawyer examining you will ask you questions about the events and facts that form the subject matter of the case. The examining lawyer may also ask you to look at specific documents and ask you questions about the documents. Generally, the questions are specific and leading questions, but you are not limited to a yes or no answer. You can give complete answers, although you should try to avoid rambling. The questions asked of you are designed to elicit specific information or admissions. The opposing lawyer may ask you to agree with them about how specific events happened. The lawyer examining you is representing the opposing party and is undoubtedly trying to undermine your case, but even with this adversarial situation, examinations are usually polite. On some occasions examinations become tense, but if you have a lawyer representing you at the examination you can rest assured that they will interject if things become inappropriate or the other side is being too aggressive – which is rare.

 

The length of an examination varies depending upon the complexity of the case. More complex cases take more time, and generally examinations last between 1 hour up to an entire day. There is usually a lengthy lunch break of at least one hour, because examinations are often taxing for everyone involved. The Supreme Court Civil Rules limit the length of examinations. In fast track actions they are limited to 2 hours and in regular Supreme Court Actions discoveries are limited to seven hours. The exception to the time limits is that a party can be examined for longer if they consent or unless the court extends the time limit by a court order.

 

Dos and Don’ts of Examinations

If you are the party being examined for discovery, your lawyer will meet with you before the examination to help you prepare and understand what will be expected of you. It is important that you are well prepared because once you are sworn under oath you will not be able to discuss your case or your testimony with your lawyer. Your lawyer’s advice and preparation for the discovery will vary depending on the nature of your case, but your lawyer’s advice will probably include:

 

  • Always tell the truth – You are under oath and have the same liability for perjury as if you were in court in front of a judge. You should take your obligation, to tell the truth extremely seriously.
  • Dress well, sit up straight, and look the examiner in the eye – the opposing lawyer is not just interested in your answers, but also in how you answer. You want to present yourself as a strong witness who will be calm and credible in court before a judge or jury.
  • Listen to the entire question and understand it before you answer -If you don’t understand the question, you shouldn’t answer until you do. You can ask for clarification.
  • Don’t interrupt – the court reporter will be taking a transcript of the examination, and it is important that the transcript is clear and easy to read, without people talking over one another.
  • Be polite in your answers, don’t raise your voice or become angry with the examining lawyer – you want to make it clear that you will not be goaded or become angry to the advantage of the other side.
  • If your lawyer makes an objection or interjects, stop talking immediately -wait until the lawyers have dealt with the objection and you are either allowed to continue or advised

 

Being examined for discovery in a personal injury or civil case is undoubtedly an intimidating experience, but with strong representation and good preparation, you have the opportunity to gather important information about the other side’s case, and to show them what a confident witness you will be at trial. Examinations for discovery are a vital fact-finding tool in almost every personal injury or civil case, and one which may help you win at trial or achieve a fair settlement.

 

About the Author 

CThe Do's and Do Not's for Examinations for Discovery 3 Velletta Lawyers Victoria BCadeyrn Christie is a civil litigation lawyer and business lawyer with Velletta & Company. A former tradesperson, business owner, and high-performance athlete, Cadeyrn focuses his practice on providing dynamic representation to individuals and businesses.

Since joining Velletta & Company, Cadeyrn Christie has helped clients achieve cost-effective legal solutions in a wide variety of contentious matters, including business disputes, debt collections, personal injury litigation, real estate disputes, and construction litigation. Cadeyrn has represented clients at all levels of court in British Columbia, including conducting an appeal in the British Columbia Court of Appeal.

 

Removing a Lien by Posting Security

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Removing a Lien by Posting Security 4 Velletta Lawyers Victoria BC

Once someone has filed a builders lien and started litigation, there are only a few ways that the builders lien is going to be removed from the title of the property on which the lien is registered. If there are defects in the lien, the owner of the property can apply to have it removed. Assuming that there are no defects, then the owner could potentially be stuck with the lien on title until the litigation is resolved and any judgment obtained by the lien claimant is satisfied. Of course, this poses a potentially huge problem for the property owner, who may want to clear the title of their property to arrange for new financing or to sell the property.

 

The Builders Lien Act [SBC 1997] c. 45 (the “Act”) creates two options for the property owner or other parties interested in the property to clear the lien from title. Section 23 of the Act allows removal of a lien upon paying into court the total amount recoverable under the lien. That amount will either be the total amount of the lien claim, or, in some circumstances, the amount that is owed by the person depositing security to the person who hired the lien claimant. The latter set of circumstances arises when the lien claimant was hired by a contractor or subcontractor, and the person seeking the discharge of the lien is an owner or someone higher up the contractual chain who has no direct contractual relationship with the lien claimant. Section 23 provides an easier avenue to have the lien discharged if you can provide the required amount of security, which will then be held in court until the lien claim is dealt with or the matter settled.

 

In many cases, it is cost-prohibitive to put up the full amount of the lien claim as security. The lien might be for an amount that seems excessive, or even if the amount doesn’t seem excessive it might be too large to place the full amount in court. Section 24 gives the court a broader ability to cancel a claim of lien if an owner, contractor, subcontractor, or other interested party posts security that the court considers sufficient for payment of the claim of lien. The concept of “sufficient security” opens up a broader range of alternatives than putting up cash as security. Two common forms of alternative security are letters credit and lien bonds.

 

Letters Credit

Letters credit are issued by a bank, and are essentially the bank’s guarantee that payment will be made. In the case of a lien claim, the bank would guarantee that the lien claimant’s judgment will be paid if the court awards judgment to the lien claimant. Banks are risk averse, and are often reluctant to issue letters credit in lien claims unless they have a long-term relationship with the party seeking letters credit. Many banks require 100% cash security as between the bank and the party who requested the letter of credit, and for this reason it is often impractical to use a letter of credit as security for a lien claim.

 

Lien Bonds

The more common alternative is a lien bond issued by an approved surety company. The Registrar of the Supreme Court of British Columbia maintains a list of companies approved to act as sureties. Those companies can issue bonds promising to pay the amount of any judgment obtained by the lien claimant, and those bonds can then be filed with the court to secure the removal of the lien under section 24 of the Act. The surety companies charge a fee for issuing the bond, and also require security to ensure that they will be paid back if they are required to make good upon their bond. That security however is usually less onerous than the 100% cash security often required by banks, making lien bonds a practical alternative to putting up 100% cash security.

 

Having a lien removed from the title of the property is often imperative, particularly when it can take some time for a lien case to go to trial and be finally resolved one way or the other. Construction projects usually involve financing that makes it necessary to deal with any lien claims before the next financing draw can be issued. The Act provides two avenues for the owner or other interested party to clear title by providing security, and both of those alternatives are designed to ensure that the lien claimant is not prejudiced by the removal of their lien from title.

 

If you are looking to have a lien removed, it is always useful to contact a lawyer and utilize the guidance and knowledge they offer. Contact us today to find out how we can help.

 

About the Author

Removing a Lien by Posting Security 5 Velletta Lawyers Victoria BCCadeyrn Christie is a civil litigation lawyer and business lawyer with Velletta & Company. A former tradesperson, business owner, and high performance athlete, Cadeyrn focuses his practice on providing dynamic representation to individuals and businesses.

Since joining Velletta & Company, Cadeyrn Christie has helped clients achieve cost effective legal solutions in a wide variety of contentious matters, including business disputes, debt collections, personal injury litigation, real estate disputes, and construction litigation. Cadeyrn has represented clients at all levels of court in British Columbia, including conducting an appeal in the British Columbia Court of Appeal.

VIDEO: Changes to Scope of Work

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In any project, whether it is a large residential development or a small residential renovation, there are often changes to the scope of work that take place over the course of the project. In a large project a municipality might require changes in order to issue approval, or a problem, such as inconveniently located bedrock, might become apparent that needs to be overcome in order to continue with construction. On a smaller project, gutting some walls might reveal shoddy work from a previous renovation, or water ingress or mould that should be remedied while the wall is open. In all of these hypotheticals, if the contractor did not include this work in their original quote and scope of work, then a change to the scope of work becomes necessary.

 

When there is a change to the scope of work, it can be problematic, because the work is already underway and suddenly there is the need to deal with the uncertainty created by the change in scope. The contractor will want to ensure that they are fairly paid for the additional work required by the change in scope. The owner or client will want to ensure that the contractor does not take advantage of the situation and bill an overly large amount for the additional work. It may be a delicate situation for both parties. The homeowner might feel like they are held hostage because their house is hallway ripped apart and they don’t want to get into a dispute with their contractor and delay the completion of their home. The contractor may have invested time and money into the project and might fear that getting into a dispute over a change to the scope of work will prevent or delay payment for the work already completed.

 

In large construction contracts, there is generally an independent consultant who acts as an intermediary when changes to the scope of work are needed. When the need for a change becomes apparent, a formal written change order will be issued to the contractor, the contractor will formally quote the change, and provide the quote to the consultant, who determines whether the quote is reasonable and in theory protects the interests of both parties. There may even be provisions for arbitration if one party does not agree with the consultant’s decision on a large change order.

 

For homeowners, it is cost prohibitive to have an independent consultant, and the pace of change on a residential project can be rapid, especially if the project is a residential renovation where things might be uncovered during the initial demolition phase. While there is no independent consultant on a smaller project, the parties themselves can still help avoid problems by clearly communicating. If the homeowner wants a change, that should be clearly specified and described. If the contractor thinks they are being asked to do something that was not included in the original scope of work, then they should deal with that issue immediately instead of putting it off until the final bill. Where both parties agree that something is an addition to the scope of work, the contractor should prepare a written quote for that addition – this is fair to both parties, the contractor is entitled to be paid for the extra work, and the homeowner is entitled to know what their requested change is going to cost.

 

While ultimately homeowners and residential contractors cannot implement the extensive procedures that are used on larger jobs, the same principles apply. The scope of work has to be clearly defined at the outset, for the benefit of both parties. Changes to the scope of work need to be clearly defined, and ideally agreed upon in writing through a written change order that defines the addition to the scope of work, and the compensation payable for completing that addition. Following these strategies should help both homeowners and contractors avoid disputes regarding the scope of work on a project. If the worst happens, and such a dispute does arise, it may be time to consult with construction litigation counsel. Velletta & Company is pleased to assist clients facing a construction litigation dispute, whether they are homeowners or contractors.

 

VIDEO: Changes to Scope of Work 6 Velletta Lawyers Victoria BCCadeyrn Christie is a civil litigation lawyer and business lawyer with Velletta & Company. A former tradesperson, business owner, and high performance athlete, Cadeyrn focuses his practice on providing dynamic representation to individuals and businesses.Since joining Velletta & Company, Cadeyrn Christie has helped clients achieve cost effective legal solutions in a wide variety of contentious matters, including business disputes, debt collections, personal injury litigation, real estate disputes, and construction litigation. Contact Cadeyrn Christie

 

Builders Liens and How to Get Paid in Construction

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The construction industry is one of the places where disputes often arise over unpaid bills, the scope of work, and whether or not work is done correctly. The end result is that tradespeople are often left fighting to get paid for the work that they performed on a project. Add in the fact that many construction projects are done based on a verbal agreement and a handshake, and you have a recipe for contentious disputes. Even worse, if you are a subcontractor, the head contractor with whom you reached an agreement might go bankrupt, leaving you with a dry judgment that cannot be easily enforced.

 

The law has evolved to recognize that disputes often come up in construction, and that there are unique factors that may make it difficult to get paid. The culmination of the legal solution to this problem is the British Columbia Builders Lien Act (the “Act”). In order to protect contractors and subcontractors, the Act establishes special remedies. In order to qualify for these remedies, you must comply strictly with the Act. If you miss a deadline or make a mistake in filing your lien, your lien will likely be invalid and may be struck if the owner of the property, or anyone else interested in the lien claim, takes you to court. If you lose in court, you may also have to pay the successful party’s legal fees.

 

The Act allows a person who supplies work or material to an improvement on a property, and has an unpaid invoice, to file a builders lien against the title of the property. The lien then goes on the title, like a mortgage or other encumbrance. People who search the title of the property, such as people who are interested in purchasing the property, will see the lien and be alerted to your claim.

 

Once you have filed your lien, the owner of the property and any head contractor may be more willing to negotiate the payment of your invoice. If filing the lien is not enough and there is still a dispute, then You may ultimately have to take your case to court and enforce your claim of lien.

 

The lien gives you security for your claim, against the title of the property that you worked upon. Even if the head contractor goes bankrupt, and you have no contract directly with the owner of the property, you can still potentially recover at least part of your unpaid invoice from the owner. This may seem unfair to owners at first, but keep in mind that the tradespeople who worked on the property improved the property and presumably increased its value.

 

Unfortunately, while the Builders Lien Act provides valuable protection to tradespeople, it also is extremely complicated, and cannot be fully explained in a short article. The Act also involves a series of holdbacks kept all the way down the chain from the owner, to the head contractor, and to the sub-contractor. Unfortunately, these holdbacks are often not dealt with properly, especially on smaller projects where the parties may be used to doing things more informally. If the holdbacks are dealt with improperly, it can further complicate matters.

 

If you are facing a builders lien issue, it likely makes sense to consult with a lawyer. There are tight timelines involved, and if you fail to file your lien within the timelines, then you may completely lose the right to file a builders lien. In some situations the deadline can be 45 days from when you finish the job. This makes it a very tight timeline indeed when you factor in that many invoices are not due and payable until 30 days after they are issued. Because of these tight timelines, you should talk to a lawyer as soon as possible If you get the suspicion that your invoice is not going to be paid on time.

 

If you are facing a builders lien situation, Velletta & Company offers a free consultation to discuss your situation and how we can help you obtain payment for your invoice.

 

Builders Liens and How to Get Paid in Construction 7 Velletta Lawyers Victoria BCCadeyrn Christie is a civil litigation lawyer and business lawyer with Velletta & Company. A former tradesperson, business owner, and high performance athlete, Cadeyrn focuses his practice on providing dynamic representation to individuals and businesses.

Settlement Conferences: Your Complete Guide

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Settlement Conferences: Your Complete Guide 8 Velletta Lawyers Victoria BC

A settlement conference is a private hearing between the parties involved in a lawsuit, and a judge. At a settlement conference the judge presides over the conference, guiding settlement discussions between the two sides. As the costs of going to trial rise, settlement conferences have become an important part of civil litigation, that often allow the parties to resolve their dispute and avoid the costs and risks of a trial. Most importantly, a settlement conference is a discussion, and very little can happen at a settlement conference without consent of both parties. This means that the risk of a settlement conference is low, and the parties can focus on resolving their dispute. Discussions at a settlement conference are without prejudice, and cannot later be brought up in court if the case goes to trial.

 

Small Claims Court:

British Columbia Small Claims Court hears civil claims up to the amount of $35,000, with some exceptions. In a Small Claims case, both sides will file documents with the court called pleadings. The Claimant will file a Notice of Claim setting out their allegations, and the Defendant will file a Reply containing their response to the Plaintiff’s allegations. Once this happens, the parties will wait to receive a notice form the court registry notifying them of the date set for a settlement conference. In Small Claims Court a settlement conference is mandatory, and if you do not attend you may lose by default.

 

Supreme Court Settlement Conferences:

Cases that involve damages over $35,000, and cases specifically excluded from Small Claims Court, must be litigated in the British Columbia Supreme Court. Although settlement conferences are not mandatory in Supreme Court, it is still possible to have a settlement conference under certain circumstances.

 

Supreme Court Civil Rule 9-2 sets out when a settlement conference happens in Supreme Court. Both parties can agree to have one by filing a form, or a judge or master of the court can order that the parties attend a settlement conference. Like in Small Claims Court, the judge or master who presides over the settlement conference will help the parties to discuss settlement of their dispute. The judge or master who presides over the settlement conference will not preside over the trial unless all the parties consent.

 

What Happens at a Settlement Conference?

Each judge or master may conduct settlement conferences slightly different, but there are some common factors that you should know. Generally the judge will have read the pleadings and will know what the case is about. The parties may have a brief opportunity to set out their case, or the judge may launch right into asking questions of one or both parties regarding their case.

 

Ultimately the judge will try to start a discussion of settlement, often by asking the defendant if they are willing to make an offer to settle the case. Some judges weigh in on what they think are the merits of the case, or problems that they foresee with the case that would make it worthwhile to settle and avoid a trial. These judges may offer their opinion on the merits of the case so that the parties can make a more informed decision about whether they want to settle or go to trial. Other judges tend to focus less on the merits of the two parties’ respective cases, and more on getting a dialogue going between the parties. Either way, the goal is to see if the parties can agree on a settlement.

 

You will never have the same judge at a trial if the case ultimately goes to trial, because the settlement conference judge has heard the without prejudice discussion of the parties.

 

One thing to be prepared for is that you will likely be asked to compromise on your position. In our experience, settlement conferences are a pragmatic affair, where parties are discouraged from making a stand based on principals. Litigation to trial is expensive, in terms of costs if you have a lawyer, or in terms of time if you represent yourself. Going to trial is almost always a risky situation, despite how strong your case may be. There is always the possibility that the other side succeeds in convincing the judge. Parties are expected to take into account these costs and risks when discussing settlement, and usually judges will expect there to be movement on both sides.

 

You are perfectly entitled to stand on principal and refuse to compromise on your position at a settlement conference, but you should be prepared to defend that position if questioned on why you will not compromise. If you take this position, it’s probably more likely that your case will go to trial, because if you’ve ended up having to file a lawsuit, the other side is unlikely to suddenly change their tune and completely accede to your position.

 

In Small Claims, if the parties cannot reach an agreement, the judge often switches over to making administrative orders about the future trial and what must happen before trial. Usually these orders will include an order that the parties exchange document disclosure a certain number of days before trial. The judge may also ask you how many witnesses you intend to have testify at the trial. The judge will determine how much time is needed for the trial, which is very important. You should be prepared for these questions in case the trial does not settle, so that you can deal with any administrative matters while you are before the judge, and get clear orders about how to prepare for trial.

 

Why are Settlement Conferences Useful?

 

A surprising number of cases settle at the settlement conference or shortly thereafter. Having both parties in the same room, before an experienced and impartial individual, is an excellent opportunity to resolve the case. Things can move much more quickly when compared with sending written settlement offers back and forth. Perhaps most importantly, a settlement conference gives you a sneak peek at how the other side will appear at trial. You may hear about their case and learn why they think they will win at trial. This can be especially helpful if the other side’s pleadings are less than clear in setting out their position.

 

At a minimum, even if the case does not resolve, you will likely walk away from the settlement conference with a better idea of the other side’s case, which will enable you to better prepare for trial. You will likely know how they articulate their case in their own words, how well they present themselves before a judge, what witnesses they intend to call, and how much time they think the trial will take. All of this information will help you avoid being surprised at the trial, and will give valuable insight into how you should plan your own case to overcome the position of the other side.

 

Strong Negotiating Skills

Settlement conferences come down to negotiation. You will have a certain amount of leverage going into a settlement conference, depending upon how strong your case is. What you do with that leverage is up to you. Generally your goal is to maximize the amount that you recover, and to do this you need to highlight the strength of your case to the judge and the other side, increasing your leverage, and hopefully getting a better settlement offer out of the opposing party. At Velletta & Company we pride ourselves on being strong litigators, who understand both the benefits of negotiating a fair resolution, and the strategic value that can be taken away from a negotiation, even if you cannot reach an agreement. If you are facing an upcoming settlement conference, please feel free to contact us for a consultation.

 

Travel Insurance 101

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Travel Insurance 101 9 Velletta Lawyers Victoria BC

Many people are careful and buy travel insurance before they leave Canada to protect themselves in case they have a medical emergency while traveling. After all, some countries, like the United States, have expensive medical systems that can cost travelers tens of thousands for even the simplest treatments. Smart travelers seek to avoid this risk through travel insurance; however, few of these travelers actually read the densely worded insurance policies that apply to this type of insurance. If they did, they might be shocked to learn how many exclusion clauses these policies contain.

 

Exclusion clauses are terms in the insurance policy that specifically exclude coverage for certain things. These clauses give the insurance company an opportunity to deny your insurance claim. You might go on vacation and end up fighting for your life in the face of a medical emergency, only to make it back to Canada and end up in another battle, this time with the insurance company. If the insurance company denies your claim and you disagree with their decision, you can try to change their mind, but ultimately you may have to take them to court and sue them for coverage under your insurance policy.

 

In a recently reported court decision, our firm successfully challenged an insurance company’s decision to deny a claim. Our client was faced with a cripplingly large medical bill for a quadruple bypass surgery in the United States. The insurance company refused to cover our client’s expenses, saying that our client had left on vacation while having a reasonable expectation that he could require medical treatment while traveling.

 

After a hard fought trial in British Columbia Supreme Court, the Court agreed with our argument that our client had taken reasonable steps in the circumstances, and did not have a reasonable expectation of needing medical care while on vacation. The Court ordered that the insurance company indemnify our client for his medical expenses, and pay legal costs.

 

This case is not unique, because many travel insurance claims are denied based on exclusion clauses. The exact structure of these exclusions varies from policy to policy depending on the wording, but the general result is that if you travel with a pre-existing medical condition, or take a trip knowing that you might require treatment, you can end up in a dispute with the insurance company if your condition deteriorates and you need medical treatment while abroad.

 

A cautious traveller, and in particular anyone with known health challenges, would be wise to take the following steps prior to travelling:

  1. Read your insurance policy and make note of exclusion clauses. What are they for? Do they seem like something that would apply to you?
  2. If in doubt, ask your insurance broker, or the insurer directly whether you are covered in your specific circumstances. Make notes of the conversation, who you spoke to, and the information they gave in case a dispute develops later.
  3. Talk to your doctor if you have specific health problems or concerns that might arise while traveling.
  4. If in doubt, consider postponing your vacation until your health improves. This is a frustrating last resort, but inevitably less frustrating than becoming involved in a costly legal battle if you need medical treatment while traveling and your claim is denied.

 

No one sets out on a trip expecting to have a medical emergency. The careful traveller buys travel insurance in case the worst happens and a trip is ruined by just such an emergency, but coverage is never absolute and if your claim is denied the financial consequences can be devastating. Being careful, reading the policy, and seeking more information if necessary, can help you avoid a situation where the insurance company denies your claim for medical expenses incurred while traveling.

 

If you take all these steps and the insurance company still denies your claim, then you may need to take the insurance company to court to get coverage for your expenses. Velletta & Company is experienced in dealing with insurance companies through both negotiation and, if necessary, litigation. We regularly deal with insurance companies including on cases involving motor vehicle accidents, life insurance, home insurance, and travel insurance. If you are facing a dispute with an insurance company, we would be happy to meet with you and discuss your unique needs.

 

Travel Insurance 101 10 Velletta Lawyers Victoria BCCadeyrn Christie is a civil litigation lawyer and business lawyer with Velletta & Company. A former tradesperson, business owner, and high performance athlete, Cadeyrn focuses his practice on providing dynamic representation to individuals and businesses.

Scope of Work in Construction Litigation

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The scope of work in a construction contract lays out what work is going to be completed by the contractor. This is a fundamental and important aspect of the agreement, that needs to be carefully set out to avoid disputes and ensure that the contractor is fairly paid, but not overpaid, for the work that they perform. Large scale construction contracts have detailed processes to clearly define the scope of work and deal with any changes that come up once work has started. Homeowners and contractors who deal with smaller projects often do not have the same level of detail regarding the scope of work, and unfortunately, this is a common area of dispute where the relationship breaks down between a contractor and homeowner. If the scope of work is not defined, the homeowner may dispute the bill thinking that they have been overcharged or the contractor has under delivered on what was required. While it is not always possible to implement the extensive procedures that are used on large projects, homeowners can benefit from knowing how large projects are conducted, and where possible applying these principles to the relationship with their contractor. Likewise, contractors can benefit from having clear quotes that precisely detail their scope of work so that the customer is less likely to dispute the contractor’s bill, and if a bill dispute develops the contractor has a better case in the event that matters go to court.

 

Setting out the Initial Scope of Work

The initial scope of work will be the basis on which the contractor makes their initial estimate or if they are offering an all-inclusive price, their quote for the job. The initial scope of work must be ascertained in order for the contractor to accurately estimate or quote the job. For large projects, the scope of work will likely be determined by a full set of plans and may include detailed specifications for the materials and construction techniques that the contractor must utilize. For homeowners, this is often not feasible; however, the more detail that can be communicated to the contractor in determining their estimate or quote, the better the chance that everyone is on the same page and the project will run smoothly, resulting in a satisfied client and a contractor who received the payment that they expected.

 

Ideally, a homeowner will have a set of plans on which the contractor is asked to offer an estimate or quote before the parties enter into a written agreement that includes details like payment terms and completion dates. If this is not possible, the homeowner may be wise to sit down with the contractor and go over the design of what they want to be built, and the materials that they want the contractor to use. For a homeowner who is not experienced with construction, the contractor may be able to offer advice and assistance in selecting materials and designing the improvement. At a minimum, both parties benefit by making sure that there is a written description of what will be constructed, the materials that will be used, and the cost.

 

Putting time and energy into defining the scope of work at the outset of the project may be difficult for the impatient, who want to get the project underway, but a clearly defined scope of work helps give both sides a better idea of the costs involved in the project and helps to avoid costly disputes. For both the homeowner and the contractor, having a clear understanding of the project is vital. The homeowner must understand exactly what they are getting, and how much they will need to pay. The contractor must understand exactly what is expected of them, and a clearly defined scope of work allows the contractor to show that they have completed the project and deserve payment.

 

Changes to the Scope of Work

In any project, whether it is a large residential development or a small residential renovation, there are often changes to the scope of work that take place over the course of the project. In a large project a municipality might require changes in order to issue approval, or a problem, such as inconveniently located bedrock, might become apparent that needs to be overcome in order to continue with construction. On a smaller project, gutting some walls might reveal shoddy work from a previous renovation, or water ingress or mould that should be remedied while the wall is open. In all of these hypotheticals, if the contractor did not include this work in their original quote and scope of work, then a change to the scope of work becomes necessary.

 

When there is a change to the scope of work, it can be problematic, because the work is already underway and suddenly there is the need to deal with the uncertainty created by the change in scope. The contractor will want to ensure that they are fairly paid for the additional work required by the change in scope. The owner or client will want to ensure that the contractor does not take advantage of the situation and bill an overly large amount for the additional work. It may be a delicate situation for both parties. The homeowner might feel like they are held hostage because their house is hallway ripped apart and they don’t want to get into a dispute with their contractor and delay the completion of their home. The contractor may have invested time and money into the project and might fear that getting into a dispute over a change to the scope of work will prevent or delay payment for the work already completed.

 

In large construction contracts, there is generally an independent consultant who acts as an intermediary when changes to the scope of work are needed. When the need for a change becomes apparent, a formal written change order will be issued to the contractor, the contractor will formally quote the change, and provide the quote to the consultant, who determines whether the quote is reasonable and in theory protects the interests of both parties. There may even be provisions for arbitration if one party does not agree with the consultant’s decision on a large change order.

 

For homeowners, it is cost prohibitive to have an independent consultant, and the pace of change on a residential project can be rapid, especially if the project is a residential renovation where things might be uncovered during the initial demolition phase. While there is no independent consultant on a smaller project, the parties themselves can still help avoid problems by clearly communicating. If the homeowner wants a change, that should be clearly specified and described. If the contractor thinks they are being asked to do something that was not included in the original scope of work, then they should deal with that issue immediately instead of putting it off until the final bill. Where both parties agree that something is an addition to the scope of work, the contractor should prepare a written quote for that addition – this is fair to both parties, the contractor is entitled to be paid for the extra work, and the homeowner is entitled to know what their requested change is going to cost.

 

While ultimately homeowners and residential contractors cannot implement the extensive procedures that are used on larger jobs, the same principles apply. The scope of work has to be clearly defined at the outset, for the benefit of both parties. Changes to the scope of work need to be clearly defined, and ideally agreed upon in writing through a written change order that defines the addition to the scope of work, and the compensation payable for completing that addition. Following these strategies should help both homeowners and contractors avoid disputes regarding the scope of work on a project. If the worst happens, and such a dispute does arise, it may be time to consult with construction litigation counsel. Velletta & Company is pleased to assist clients facing a construction litigation dispute, whether they are homeowners or contractors.

 

Scope of Work in Construction Litigation 11 Velletta Lawyers Victoria BCCadeyrn Christie is a civil litigation lawyer and business lawyer with Velletta & Company. A former tradesperson, business owner, and high performance athlete, Cadeyrn focuses his practice on providing dynamic representation to individuals and businesses.Since joining Velletta & Company, Cadeyrn Christie has helped clients achieve cost effective legal solutions in a wide variety of contentious matters, including business disputes, debt collections, personal injury litigation, real estate disputes, and construction litigation. Contact Cadeyrn Christie

The New Civil Resolution Tribunal

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the-new

In British Columbia, most disputes involving less than $25,000 are resolved through Small Claims Court. Unfortunately many Small Claims litigants find this process time consuming and difficult to navigate without a lawyer, despite efforts to make it easier for parties to represent themselves and quickly settle their disputes through negotiation. Even with these efforts, Small Claims cases can take over a year to go to trial, if the case does not resolve at the mandatory settlement conference. In response to these problems, some have called for an expedited administrative process to deal with smaller disputes in a timelier manner, and without all of the formalities and rules of a traditional court proceeding. In response to these concerns British Columba enacted the Civil Resolution Tribunal Act [SBC 2012] c. 25 (the “Act”).

 

The Act

The Act establishes a Civil Resolution Tribunal (the “CRT”) that would provide an accelerated process for resolving minor strata property disputes and civil disputes up to $10,000. Initial tests of the tribunal process using a voluntary model showed low adoption, and so the process was made mandatory. The actual implementation however has been slow, and the Act is not yet fully implemented. In July 2016 the CRT began accepting strata disputes, and the current plan appears to be that in 2017 the CRT will begin accepting civil disputes up to $10,000.

 

Our firm regularly conducts Small Claims cases on behalf of our clients, and we are actively monitoring the development of the CRT so that we can advise our clients regarding this new dispute resolution process.

 

The Act contains a number of provisions that will make the CRT process very different from the traditional Small Claims Court process. Section 18 of the Act states that a tribunal proceeding is to be conducted with as little formality and technicality, and as much speed as is possible under the Act, the Rules, and with a proper consideration of the issues in the dispute.

 

The First Major Difference

Most, if not all, CRT proceeding will be conducted over the internet. Section 19 of the Act specifies that the tribunal may use electronic communication tools to conduct all or part of a proceeding. Courts have already begun to adopt online communication tools like video conferencing, but such methods are the exception rather than the rule. The CRT will change this, but it is not yet clear how the CRT intends to deal with parties who do not have internet access or who are not familiar with computers. One only has to sit through one attempted video conference that experiences technical difficulties to discover how quickly technology can malfunction, even with technologically sophisticated parties.

 

The Second Major Difference

Lawyers will only participate in CRT hearings under limited circumstances. Section 20 sets out that generally the parties are expected to represent themselves. There are exceptions that allow lawyers to act in CRT hearings when their client is a child or mentally impaired, when the rules otherwise permit, or when the tribunal deems it in the interests of justice and fairness.

The Possible Effects

Naturally lawyers are concerned about any quasi-judicial process that limits the rights of the parties to retain trained legal counsel. This is not a concern that is born out of self-interest. Disputes under $10,000 are rarely a profitable endeavor for a lawyer. The concern is that lawyers often play a vital role in negotiating matters, keeping the parties calm, and ensuring that the process runs smoothly. Lawyers also help muster the evidence and present it in an organized and compelling manner to secure the best possible result for their clients. Without lawyers involved in the process, the tribunal itself will have to accomplish these tasks, as well as adjudicating the dispute. If the tribunal fails to fill this void, the inevitable reality is that some parties will suffer from the lack of legal counsel.

 

It is too soon to tell how the CRT process will actually be implemented, but we are cautiously observing the development of this new process in order to monitor any potential impact on our clients.  If you have any questions, as always, contact us here at Velletta & Company!

 

ABOUT THE AUTHOR

_DSC0089_lowrezCadeyrn Christie is a civil litigation lawyer and business lawyer with Velletta & Company. A former tradesperson, business owner, and high performance athlete, Cadeyrn focuses his practice on providing dynamic representation to individuals and businesses.

OPCA Litigants: Their Own Worst Enemy.

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The term “OPCA litigant” (Organized Pseudolegal Commercial Argument litigant) appears to have been first coined by Mr. Justice Rooke of the Alberta Court of Queen’s Bench, in his seminal decision of Meads v. Meads, 2012 ABQB 571*.

Meads was a family law case in which one party chose to advance a number of meritless arguments in an attempt to deprive the court of jurisdiction or otherwise derail the matter. These arguments included claiming that the opposing party, the opposing party’s lawyer, and the court were attempting to “induce him into slavery”. The OPCA litigant produced reams of documents and left a court hearing half way through, apparently out of the fear that by remaining he would accept the court’s jurisdiction over him.

 

Mr. Justice Rooke took the case as an opportunity to release a massive 188 page decision that not only dealt with the issues between the parties, but went on to explore in depth the different types of OPCA litigants and explain why their arguments don’t work.

OPCA litigants have many different varieties. Some of the more common variants include the “Freemen on the land” movement, de-taxers and Sovereign Citizens; but there are many others. The main characteristic of OPCA litigants is that they purport to believe that they have some kind of special tactic that will deprive the court of jurisdiction over them, or otherwise exempt them from following the law.

OPCA litigants usually represent themselves, as all lawyers are officers of the court with a duty to refrain from vexatious or meritless litigation, and so it is extremely unlikely that a lawyer would knowingly advance the case of an OPCA litigant. Many self-represented parties do an excellent job and would never engage in OPCA tactics, but almost all OPCA litigants are self-represented. This self-representation makes OPCA litigants even more challenging, because the court has a duty to explain the process and render some limited level of assistance to self-represented litigants. In the case of OPCA litigants, the court has to walk a fine line to fulfill their duty to the self-represented party, while also minimizing the impact of the shenanigans in which OPCA litigants routinely engage. The courts across Canada are increasingly aware of this issue, and are actively working to avoid the negative impacts of OPCA litigants.

 

Don’t Buy in to the OPCA!

The various strategies of OPCA litigants are too wide-ranging to fully discuss in this article, but some of them include:

  • Claiming that they are “natural persons” and are subject only to “God’s Law” and not to the laws of man;
  • Alleging that individuals are only obliged to pay income tax if they opt-in to government provided programs, like Canada Pension Plan;
  • Relying upon centuries-old statutes from England as part of an argument that Canadian courts lack jurisdiction to decide legal matters;
  • Claiming that due to procedural irregularities in their creation, Canadian courts only have jurisdiction over admiralty law and the sea, and have no jurisdiction on dry land;
  • Flat out refusing to acknowledge the jurisdiction of the courts, on the basis that the court has no jurisdiction over the individual unless the individual accepts the jurisdiction of the court.
  • Affixing stamps, thumb prints, and Latin phrases to documents, either to deliberately confuse the reader, or out of the belief that these items have some legal significance or impact.

Most troubling is the fact that OPCA argument is often promoted by “gurus” who sell their strategies to gullible individuals. This is especially common with tax evasion schemes where a guru will convince people that a made up strategy can allow them to never pay income tax and thereby take home more money. Often these gurus end up in jail or on the losing end of civil court actions due to their own strategies, but that is little consolation to someone who bought in to the guru’s strategy and ended up facing serious regulatory or criminal penalties; such as going to jail for tax evasion.

Canadian courts have unequivocally rejected the arguments and strategies advanced by OPCA litigants, especially the OPCA claim that the courts lack jurisdiction. The courts exist to enforce the law, to provide a venue for the resolution of disputes, and to create order in our society. In order to do this, the courts need the jurisdiction to fulfill these goals. In Meads at para 370 the court succinctly explained the position of Canadian courts towards OPCA and jurisdiction:

“There is always a court, though perhaps not this one, that has jurisdiction over these litigants and their activities. They cannot opt out. All arguments that invoke ‘immunity’ and indeed any schemes that claim a person can possess or acquire a status that allows them to ignore court authority are incorrect in law.”

The Meads decision goes on to address the other strategies of OPCA litigants, including debunking the idea that centuries-old statutes like the Magna Carta protect individuals from all government legislation, and rejecting the OPCA theory that everything, including paying income tax, is a contract that you can opt out of or terminate.

The court in Meads ultimately concluded that none of the OPCA strategies were valid, and stated that courts should dispose of OPCA arguments as directly as possible to protect those targeted by OPCA litigants, avoid the waste of court time, and to send a clear message that OPCA strategies will not succeed.

The end result is that pursuing these strategies will not magically make the case against you go away, and at most will result in only a temporary delay of the proceedings, while reducing the credibility of any legitimate legal arguments that you may have.

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What to Do When Faced with an OPCA Litigant?

The recent BC Supreme Court case reported under the style of cause For the Peter of the August-Sjodin Family,: sp17uwe./:secwepemc v. Little Shuswap Lake Indian Band, 2016 BCSC 1213, illustrates the damages that a vexatious OPCA litigant can cause.

The unusual style of cause gives away the OPCA strategies of the litigant in this case, who commenced various actions against his tribal band and its officials. The plaintiff was seeking, among other things, access to facilities from which he had been banned and compensation of “$20,000 in functional fiat Canadian currency from each defendant.”

The Notice of Civil Claim contained stamps, fingerprints, numbers and random letters that the court concluded were meaningless. The legal actions started by the plaintiff did not appear to have any merit, but still had to be defended by the defendants, causing significant costs.

Ultimately the court made an order that the plaintiff would have to provide security for costs before he could proceed with his action. This meant that the plaintiff could not take any steps in his lawsuit without putting an amount in to court that was deemed sufficient to cover the defendant’s costs if the plaintiff ultimately lost the case. Unfortunately the defendants were left with no recourse against the plaintiff to cover the already substantial legal costs that they had been forced to incur, because the plaintiff had no money. It is unlikely that the plaintiff would come up with the security for costs, and so his case was effectively at an end.

OPCA litigants usually end up in disputes with the government, but in civil actions against a private defendant the OPCA litigant can cause you to incur substantial costs just to deal with the OPCA litigant’s nonsense. If the OPCA litigant has no money these costs may be impossible to recover, so dealing with an OPCA litigant as cost effectively as possible is a priority.

 

The following are some of the strategies available to limit the damage caused by OPCA litigants:

  • Make an application to strike the OPCA plaintiff’s pleadings. This involves an application to a Master of the court, or a judge, and if the application is successful then the plaintiff’s claim against you can be dismissed. More likely the court may order that the plaintiff amend their claim, which limits the benefits of this option.
  • If the OPCA litigant actually has property, then you may pursue an award of special costs against them in order to recover the legal fees that you were forced to incur due to their meritless claim. This is possible where the OPCA litigant’s conduct has risen to an outrageous level and fulfills the legal test for an award of special costs. Unfortunately, many OPCA litigants are also flat out broke so no award of costs could ever be collected.
  • Seek security for costs where the OPCA litigant’s claim, defence or application is clearly meritless. This strategy appears to be gaining popularity to deal with the fact that many OPCA litigants will never pay a costs award after the fact. Where appropriate, your counsel might apply to the court for an order that the OPCA litigant be forced to pay into court an amount to cover costs before they can proceed with their litigation. For impecunious and vexatious OPCA litigants, this might prevent them from being able to proceed with their litigation.
  • Finally, for particularly persistent OPCA litigants someone may ultimately need to make an application to have them declared a vexatious litigant. If successful, that type of application can result in an order prohibiting the OPCA litigant from starting new lawsuits without the permission of a judge.

 

Conclusion

Many people would love to write their name in capitals, reference some centuries-old statute, throw in some incorrectly used Latin phrases and a few thumb prints for good measure, and completely avoid income tax, child support, or other obligations. Fortunately this is simply not possible.

The various OPCA schemes only end one way, with the OPCA litigant on the losing end; despite any meritorious arguments that they may have had before resorting to OPCA strategies. There are techniques for dealing with OPCA litigants, should you ever have the misfortune of facing one in a civil matter.

If you do find yourself in such an unfortunate situation, it is wise to seek experienced legal counsel as soon as possible. Velletta & Company is proud to offer a full range of legal services, including civil litigation defence. We have dealt with OPCA litigants in the past, including securing special costs awards against OPCA litigants. Contact us today!

 

*To anyone who is interested in reading more about this topic, the author recommends the Meads decision above as an excellent starting point as it cites many of the important OPCA decisions in Canada.

Promissory Notes

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Promissory Notes: Ancient Origins, Modern Importance

Promissory notes are believed to have originated in ancient China, and then made their way into European history, before ultimately becoming an important part of modern business. In ancient times money was made of precious metal, and any large transfer of funds over a distance was a heavy proposition, so promissory notes evolved as a lighter alternative. Now it is common to use promissory notes in many different business transactions, and for loans between private individuals. The Canadian Bills of Exchange Act (R.S.C., 1985, c. B-4) creates a statutory definition in section 176(1) for promissory notes in Canada:

 

“an unconditional promise in writing made by one person to another person, signed by the maker, engaging to pay, on demand or at a fixed or determinable future time, a sum certain in money to, or to the order of, a specified person or to bearer.”

 

Benefits of Promissory Notes

The main benefit of a promissory note is that it clearly documents an obligation to pay money, and creates a strong cause of action in the event that the issuer defaults upon the note. The signed promissory note is effective from the time it is made, and is an independent obligation of the issuer. If the note is drafted properly, the holder of the note can sue upon it without having to prove much beyond the fact that the defendant issued the note, and then defaulted upon it.

 

Strategically, having a signed promissory note can be invaluable to a creditor seeking to collect upon a debt. Collections work is pragmatic, and no creditor wants to spend more money enforcing a debt than the debt is actually worth. Litigation is expensive, and it takes a significant amount of time to obtain a judgement. In order to provide a more efficient method of obtaining judgment, the British Columbia Supreme Court Civil Rules contain a process called a summary trial. A summary trial is available in cases where a judge is able to decide the issue without having to hear live testimony and weigh the credibility of the parties. A signed promissory note can help a creditor to qualify for the summary trial process, and as a result obtain a more rapid and cost effective judgment against the debtor.

 

Pitfalls of Promissory Notes

 

1: A Sum Certain in Money

In order to be a promissory note, the document must make it clear that the issuer of the note is unconditionally promising to pay a specific amount of money. This makes a promissory note distinguishable from a revolving line of credit. The note must make it clear how much is owed by the issuer of the note. If the amount is not clear, then you have no promissory note, and consequently a big problem.

 

2: Interest

If the note contains interest, it must be clear how interest is calculated. This ties in to the requirement that the note be for a sum certain in money. The interest must be capable of being objectively calculated, and this requires that the rate of interest be stated, along with the formula for how interest is calculated – e.g. simple interest, or interest compounded monthly.

 

3: Notice of Default or Demand for Payment

Notes need to make it clear when a default has occurred. Many notes with regular payments contain a provision that the holder of the note must give notice of default to the issuer of the note, and the issuer must fail to remedy the default within a certain period of time, before the issuer can accelerate the debt and collect. If you are the one signing the promissory note, you may want a provision that gives you time to remedy a default without the holder of the note taking collection actions. On the other hand, if you are the holder of the note, you need to make sure that you give notice of a default correctly, and wait the requisite amount of time before taking collection actions.

 

For promissory notes that are payable on demand, you will also likely want to include in the note the amount of time that the issuer has to pay the note, after demand has been given. Under the common law, the issuer had a reasonable amount of time to satisfy the demand, and this had to be assessed taking into consideration the amount of the note. You would be wise to include a specific amount of time in order to avoid this issue, and make it totally clear how much time the issuer has to satisfy the demand.

 

For both defaults on installment notes, or demands for repayment on demand notes, the note should specify whether the notice must be given in writing, and whether it needs to be given at a particular place. In order to give effective notice, the holder of the note will need to comply with these requirements, or else the notice may be ineffective and therefore not trigger the issuer’s obligations.

 

4: Limitation Periods

Promissory notes can be either due on demand, or else contain specific dates on which payments must be made. For both types of notes, if the issuer defaults, you must bring a civil action to enforce the note within the applicable limitation period. The Limitation Act [SBC 2012] c.13 creates a general two year limitation period to commence a civil action. This limitation period runs from the date that the claim is discovered. For a note with regular payments, a claim would usually be discovered when the issuer of the note defaults upon a payment and fails to remedy the default within any time specified in the note.

 

For demand notes however, the situation is potentially much different. A note payable on demand can be demanded by the holder of the note at any time. Under the common law, demand notes were considered to be due and payable when the note was issued, and the limitation period ran from that date. Fortunately, the Limitation Act contains section 14, which provides that for claims upon a demand obligation, the claim is discovered on the first day that there is a failure to perform the obligation after a demand for performance has been made. This protects the holder of a demand note from their claim becoming statute barred before they have even issued a demand for performance. This only protects the holders of demand notes in British Columbia, and other jurisdictions might have less forgiving limitation periods.

 

Whether your note is payable in installments, or due on demand, it is vital to commence your enforcement proceedings quickly after there is a default. Failing to do so might result in your claim expiring, and then you are left unable to collect upon the amount in court.

 

5: Acceleration on Default

When a note contains payment in installments, and a payment is missed, this traditionally only allows the holder of the note to sue for the missed payment. The holder of the note could not sue for the full amount of the note unless there is a provision allowing the holder to accelerate the debt. Acceleration is important, because if the issuer of the note starts missing payments, you want to be able to claim the whole amount owing immediately, and not have to commence a separate lawsuit for each missed payment as the payments are missed. Promissory notes are subject to the legal rule of contra proferentem, meaning that courts will strictly interpret any ambiguity in the note against the party who drafted it, resolving any doubt about the meaning of a term in favor of the other party. It is important that the provision is drafted clearly, and gives the holder of the note the unambiguous right to claim the entire outstanding amount as immediately due and owing if the issuer of the note defaults upon a single payment.

 

From a practical point of view, you might choose not to accelerate the note, but the threat of doing so is a powerful bargaining chip to keep the issuer of the note on track with their payments.

 

Why Hire a Lawyer for a Promissory Note?

Our office routinely sees promissory notes that were drafted by the parties themselves without the benefit of legal assistance. These notes can range from relatively well drafted notes that are still enforceable despite their flaws, to totally useless pieces of paper that provide nothing more than a false sense of security. Even worse, we see clients who loaned money or made an agreement verbally and did not get a signed promissory note at all, which makes it potentially much harder to collect the amount owed.

 

For a lawyer, drafting an enforceable promissory note is relatively simple, and can be done for the client affordably. The lawyer will also meet with you to review your specific circumstances, and can advise you about any particular pitfalls in your situation, or about additional steps that you can take to protect yourself. In many cases, if you are loaning money and the debtor has assets, you might also want to obtain security over those assets so that you have collateral in the event that the debtor defaults. When the small cost of having a lawyer draft the note is compared with the huge hassle you can face in the event of a default, it is clear that if you are lending any significant amount of money, you’d be wise to have a lawyer prepare a promissory note.

Always Get It in Writing

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If they ever existed, the days of doing business based on a handshake and a verbal agreement seem to be long gone. We regularly have clients come to our firm with disputes in which there is no written agreement. The failure to draft a written agreement often results in a complicated fact situation that has to be sorted out by our firm and another law firm. For example, we recently assisted a client who had become embroiled in a contentious partnership dispute over a small business. While we ultimately resolved the matter with a large degree of success, it would have been much simpler, and a dispute may have been avoided entirely, if the parties had formalized their arrangement in a written agreement.

 

The Gold Standard:

In terms of enforceability, the gold standard is usually a professionally drafted contract, signed by both parties, after having received independent legal advice. Depending upon the complexity of the agreement, such a contract might cost several thousand dollars to prepare; however, if the subject matter of the contract is valuable, this cost is money well spent to protect each party in the event of a dispute. If you’re starting a business partnership that you expect to last for many profitable years, spending some money up front will help protect that business, and will help avoid your hard work being swallowed up in lawyers’ fees after a dispute develops.

 

For simpler agreements, it can be surprisingly cost effective to have a contract drafted by a lawyer, and having the contract professionally drafted will provide the peace of mind that it includes all of the proper legal formalities to make it enforceable. Sadly, we often see contracts that are drafted by the parties themselves, and these can range from perfectly enforceable contracts, to ones that lack basic legal certainties necessary to make the agreement enforceable.

 

Reconsider DIY Contracts:

We generally recommend that people do not attempt to draft their own contracts, or pull contracts from the internet in the hopes that they can tailor that general contract to their specific needs. We have seen client drafted contracts for Canadian clients contain errors such as references to the United States Uniform Commercial Code – something that you almost certainly do not want in a Canadian contract.

 

Clear Communication:

A further benefit of written agreement is that good communication and clear terms help stop disputes before they start. All too often parties skirt around the difficult or contentious issues in a business relationship, hoping to avoid conflict. In reality, by not dealing with these issues up front, the potential conflict is only pushed into the future, where both parties may have spent time and money in reliance upon agreement terms that they thought existed.

 

Damage Control:

As a final last resort, it can be beneficial to clearly communicate important terms of an agreement to the other party in writing, even if that written communication takes the form of text messages or emails. Text messages and emails are admissible as evidence, and we routinely utilize such documents in court to protect our clients’ rights.

 

The difficulty is that you cannot force terms upon someone merely by sending them a message. If the other party replies with their agreement to your stated terms, that would be beneficial. If the other party disputes the terms, then at least you have identified a disagreement early on, before time and money has been expended. If the other party just ignores your message containing the terms, and does not agree or disagree, then it may be possible to argue that they went forward with the agreement, knowing that you were relying upon the terms that you set out to them. The latter situation is a far from ideal, and if the other party does not acknowledge your terms, you should follow up to clarify your agreement, sooner rather than later.

 

In conclusion, beware of people who refuse to put things into writing. If someone balks at committing your verbal agreement to a written form, there is usually a reason, and it is better to find out sooner rather than later what that reason is.

 

If you are seeking a well drafted purchase and sale contract, partnership agreement, shareholders agreement, or other contract, or if you are involved in a business dispute, we offer a free half-hour consultation to discuss your situation and legal needs. Please feel free to contact us to schedule an appointment.

 

 

 

Can I Sue My Home Inspector?

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Can I Sue My Home Inspector? 12 Velletta Lawyers Victoria BC

Purchasers of residential real estate in British Columbia will typically engage the services of a home inspector prior to purchasing a home.  For most British Columbians, a home is the biggest purchase they will ever make, and a proper home inspection can provide some assurance as to the quality of the home and can reveal defects that could otherwise catch the buyer unawares after purchase.

In some cases, a buyer may seek redress against a home inspector if the inspector failed to identify defects or misrepresented the home or their findings in some way.

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Medical Malpractice In Canada – Why You Need Legal Advice

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Medical Malpractice In Canada - Why You Need Legal Advice 13 Velletta Lawyers Victoria BC

In Canada we rely on doctors and nurses, hospitals, and other health care providers including dentists, chiropractors, and the like to provide excellent medical treatment when we are sick or injured. When unintended consequences arise, they are often catastrophic. Nothing can be worse than a baby damaged through medical error, or leaving a hospital sicker than when you went in. If you or a loved one has suffered as a result of medical treatment gone wrong you may be entitled to compensation. To find out, it is essential that you speak to a lawyer about your claim.

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What Can You Expect in a Lawsuit?

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Velletta & Company, litigation lawyers

The timing of a lawsuit is difficult to predict. It depends on many things, including actions the Defendant takes, court schedules, and decisions the Plaintiff makes. In a personal injury lawsuit, the length of time recovery or medical treatment takes will change the length of time that a lawsuit takes. A lawsuit can take up to two years or longer to settle or go to trial.

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Has Someone Interfered With My Human Rights?

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Human rights lawyer Victoria, BC

Everyone has an intuitive sense of what their human rights are, but it’s often difficult to determine if one’s human rights have been interfered with in a way that would be punishable or compensable. When an incident occurs, people often do not have the information they need to determine what they can or should do. This article is intended as a general introduction to the human rights complaint process in British Columbia.

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Help! The insurance company is denying my claim!

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Insurance law, Victoria BC, Velletta & Company

For many Canadians, insurance is a fact of life. We rely on our insurance policies to provide for us in the case of the unexpected. Insurance has become such an important part of our lives that in 2011, Canadians spent over 39 billion dollars on their premiums.[1] When you make a claim on your insurance, your claim will be managed by an insurance adjuster. The adjuster’s job is to ensure that you are paid out properly under the policy – and in most cases, your insurance claims are handled smoothly and you get the compensation and peace of mind you paid for. However, in order to keep your insurance premiums low (and the insurance company’s profits high), the adjuster must always endeavor to keep payments under the policy to a minimum. As a result, disputes arise between insurance companies and their customers about their insurance coverage, and many people find themselves frustrated, and in need of assistance in resolving these disputes.

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Railways Lose Shield Against Civil Lawsuits

by

Canadian railways lost a historic privilege and Potentially billions of dollars yesterday when the Supreme Court of Canada ended a special rule shielding them from the full force of civil law suits.

The court found that while railways still bind a sprawling country from sea to sea, they no longer deserve special protection when their activities cause harm to citizens.

Yesterday’s case pitted Canadian Pacific Ltd. and Esquimalt & Nanaimo Railway Co. against Murray Ryan, a Victoria motorcyclist who was left with permanent knee, hip and back injuries after a 1987 accident.

The accident took place when M.R. was forced to steer across a notorious stretch of railway track down the centre of Victoria’s Store Street. M.R., 32, was thrown over the front of the vehicle when his front wheel became trapped in a portion of disused track.

“The special status enjoyed by railway companies’ under the law of negligence can no longer be justified in principle, and the time has come for that rule to be set aside,” the Supreme Court said yesterday.

The decision could easily end up costing the railways billions of dollars in repairs and renovations, Aaron Gordon, M.R. ‘s lawyer, said in an interview. He said witnesses for CP at the trial made reference to about 15,000 to 20,000 crossings — and many of them may now require safety modifications.

“It is an extraordinary decision” Mr. Gordon said. “They are going to have to examine every aspect of their operations and assess whether they are creating a danger or hazard for third parties.”

He said an important offshoot of the decision is that cities and railways have been given notice by the Supreme Court that in designing and creating thoroughfare, bicycles and motorcycles can no longer be blithely ignored.

In researching the case, Mr. Gordon said he was astonished and appalled to discover that numerous similar accidents involving bicycles and motorcycles had taken place on Store Street, dating back as far as 1926.

“We are talking about a long, long time people have been putting up with this nonsense,” Mr. Gordon said. “And the only reason was because the railways had immunity.”

“At the time of the accident, I had all my hopes and dreams wrapped up in one package,” M.R. said in an interview yesterday. “Then, it was all just sucked out of me. I don’t really have any future goals or anything to look forward to. I just hope I’ll be able to lead a comfortable life.”

M.R. said his ambitions to keep moving up the job ladder on oil-well rigs in Alberta ended abruptly. His fiancée left him and he was forced onto welfare. With his lawsuit now heading back to the BC Supreme Court, the remaining issue of the amount of damages will be argued and resolved.

The chief question facing the Supreme Court in the appeal was whether railways should be able to escape liability simply by complying with existing statutes. A judge or jury was barred from finding the companies negligent provided they adhered to these standards.

“It excused railway companies in most cases from the ordinary obligation of prudence which governs other members of society,” Mr. Justice Jack Major wrote for the Court.

“The roots of the special rule reach back to the turn of the century, when railways occupied a position of unparalleled economic and social importance to the development of Canada.”

Esquimalt and Nanaimo Railway co. built the Store Street tracks in 1907.They were later leased by Canadian Pacific Ltd. In maintaining the tracks, the railways used standards created for highway crossings. These standards permitted a gap that was easily wide enough to trap a motorcycle or bicycle tire.

In its decision yesterday, the Supreme Court restored the original trial judge’s finding that the railways were liable for negligence.

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