Directors and officers of a corporation are generally not liable for actions or liabilities of the corporation provided they act in good faith and in the best interests of the corporation.
The Industrial Design Act
Registered and Unregistered Trademarks
Fiduciary Duty
A fiduciary duty is the obligation of one party to act in the best interest of another party. These types of relations arise all over. They can include corporate relationships and patient-doctor relationships. In 2004, the Supreme Court of Canada released an important decision in regards to the meaning behind section 122(1)(b) of the Canada Business Corporations Act (CBCA) in regard to fiduciary duties.
Trust Basics
Important Clauses in a Letter of Intent
Letters of intent, also known as an LOI, is a document used to negotiate between a buyer and a seller in various types of transactions. LOI’s outline the specific terms of a potential deal that will occur at some point. LOI’s are typically used to discuss aspects in the contract that can still be negotiated.
Valid, Void and Voidable Contracts
Author: Sarah Nadon – Law Student
Edited By: Ryan Carson
What makes a contract voidable?
Voidable contracts have elements within the contract that are enforceable, therefore on their face, they appear to be valid. However, they also contain elements that make is possible for one or both parties to void the contract entirely. The contract is considered to be valid if the injured party opts not to take action and not render the contract void.
Reasons a contract may be voidable:
Failure of one or both parties to disclose a material fact,
Fraud,
Duress,
One party is legally incapacitated,
The contract contains unconscionable terms.
To enforce the voidable contract, one of the parties must exercise their right to render the contract void. But both parties have the right to enforce the contract. A void contract is different from a voidable contract because from the moment a void contract is created it cannot be fulfilled while a voidable contract can be performed and enforced as soon as the contractual defects are corrected.
What makes a contract void?
A void contract is a formal agreement that is illegitimate and cannot be enforced by law because it cannot be performed.
Reasons a contract may be void:
One party is contracted to do something impossible,
One party is contracted to do something illegal or against public policy,
The contract restricts an individual’s rights.
What makes a contract valid?
A valid contract creates a legal agreement between two parties. A valid contract contains an offer, acceptance and consideration as well as meeting of the minds and mental capacity, therefore parties are legally responsible for the performance of the contract. If one party breaches the contract, the other party may go to the courts in order to receive remedies. All elements of a valid contract are legal, enforceable and binding.
Elements of a valid contract:
Offer
Acceptance
Consideration
Meeting of the minds
Disclaimer
The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Carson Law, Carson IP, or their own legal counsel regarding any specific legal issues. Carson Law does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose.
What Is Trademark Confusion?
Author: Sarah Nadon – Law Student
Edited By: Ryan Carson
Trademark confusion arises when one trademark is confused with another trademark and when the use of both trademarks would likely lead to the inference that the goods and services are produced by the same company or individual. Trademark confusion can lessen the value of the original trademark because consumers could associate the original trademark with the goods and services of the second trademark, which may be subpar to the original.
In the 2006 case, Mattel U.S.A. Inc. v 3894207 Canada Inc., 2006 SCC 22, the Supreme Court of Canada, declared that trademark confusion resulted from when a customer mistakes the goods and services associated with both trademarks, are from the same brand. In the Mattel case, a Montreal based bar and grill restaurant applied to register the trademark “Barbie’s” in association with the restaurant. Mattel, a famous toy company, owns the trademark “Barbie,” which is associated with the world-famous doll. Mattel opposed the application based on confusion. The Trade-marks Opposition Board rejected Mattel’s opposition as it was not likely that “Barbie’s” bar and grill restaurant would likely be confused with Mattel’s famous Barbie doll.
The Trademarks Act, RSC 1985,c T-13 provides that trademark confusion can be decided by a set of five enumerated factors:
6(5). In determining whether trademarks or trade-names are confusing, the court or the Registrar, as the case may be, shall have regard to all the surrounding circumstances including:
(a) the inherent distinctiveness of the trademarks or trade-names and the extent to which they have become known;
(b) the length of time the trademarks or trade-names have been in use;
(c) the nature of the wares, services or business;
(d) the nature of the trade; and
(e) the degree of resemblance between the trademarks or trade-names in appearance or sound or in the ideas suggested by them.
However, it is essential when applying the test, not to stick to the five enumerated factors. Considering all surrounding factors will provide a more accurate assessment for confusion as the application of the test is fact dependent.
Disclaimer
The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Carson Law, Carson IP, or their own legal counsel regarding any specific legal issues. Carson Law does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose.
Force Majeure
Author: Sarah Nadon – Law Student Edited By: Ryan Carson
On March 11, 2020, the World Health Organization deemed the outbreak of Covid-19, or more commonly known as the coronavirus, a global pandemic. Many provinces entered into a state of emergency, office buildings closed, and many people were forced to work from home. Covid-19 began disrupting everything from travel to business operations.
Force majeure is a standard clause in contracts that allows both parties to be freed from liability or obligation when circumstances arise that are beyond the control of either party. These events can include war, pandemics, or an event described by the legal term act of God.
A well-expressed definition of a force majeure is found in the Supreme Court of Canada decision of Atlantic Paper Stock Ltd. v St. Anne-Nackawic:
“An Act of God clause or a force majeure clause … generally operates to discharge a contracting party when supervening, sometimes supernatural, event, beyond control of either party, makes performance impossible. The common thread is that of the unexpected something beyond reasonable human foresight and skill”.1
“An Act of God clause or a force majeure clause … generally operates to discharge a contracting party when supervening, sometimes supernatural, event, beyond control of either party, makes performance impossible. The common thread is that of the unexpected something beyond reasonable human foresight and skill”.1
During the current Covid-19 pandemic, many people are unable to meet and perform their obligations. Does this automatically mean that the doctrine of force majeure excuses all obligations?
The short answer is no. In order for one’s obligations and duties to be excused by force majeure, the contract of the individual must have an applicable force majeure clause. Even if a force majeure clause is present, most are drafted broadly so that parties have to argue what events fall under the clause. Contrary, some clauses provide a long list of events that fall under force majeure. Many clauses indicate “acts of God” however, there is very little case law that supports what an act of God is.
The first question that needs to be asked is whether the force majeure event directly impacted the individual’s ability to perform their obligation and duties. A well-drafted force majeure clause should include a requirement that the party invoking the clause provide written notice of the force majeure to the other parties included in the contract. If the force majeure clause is relied upon, the party claiming force majeure will be required by the contract to give notice that the clause is being invoked as soon as they become aware that they plan to rely upon that clause. If for any reason, there is no specific notice period, they must provide notice that is reasonable.
The short answer is no. In order for one’s obligations and duties to be excused by force majeure, the contract of the individual must have an applicable force majeure clause. Even if a force majeure clause is present, most are drafted broadly so that parties have to argue what events fall under the clause. Contrary, some clauses provide a long list of events that fall under force majeure. Many clauses indicate “acts of God” however, there is very little case law that supports what an act of God is.
The first question that needs to be asked is whether the force majeure event directly impacted the individual’s ability to perform their obligation and duties. A well-drafted force majeure clause should include a requirement that the party invoking the clause provide written notice of the force majeure to the other parties included in the contract. If the force majeure clause is relied upon, the party claiming force majeure will be required by the contract to give notice that the clause is being invoked as soon as they become aware that they plan to rely upon that clause. If for any reason, there is no specific notice period, they must provide notice that is reasonable.
The careful drafting of a force majeure clause will note what type of contract it is placed in and will help minimize potential litigation. A Force Majeure clause is put in contracts to protect parties from events that do not typically occur during everyday life; therefore, when drafting a force majeure, it should address three specific questions:
• How broad should be the definition of triggering events;
• What impact must those events have on the party who invokes the clause; and
• What effect should invocation have on the contractual obligation? 2
• How broad should be the definition of triggering events;
• What impact must those events have on the party who invokes the clause; and
• What effect should invocation have on the contractual obligation? 2
Again, when drafting the clause, many lawyers opt to use broad lists while others rely on all-inclusive and descriptive events. The force majeure clause is more than a boilerplate as it helps protect parties to a contract and avoids putting parties at risk of having a court interpret a contract. Even if a contract does not have a force majeure clause, there are still circumstances where the principle of frustration may apply.
Articles written by Sarah Nadon:
Determining Which Business Venture is Right for You! Kawhi Leonard Loses Copyright Lawsuit against Nike
Disclaimer
The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Carson Law, Carson IP, or their own legal counsel regarding any specific legal issues. Carson Law does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose.
References
1 Atlantic Paper Stock Ltd v St Anne-Nackawic Pulp and Paper Co, [1976] 1 SCR 580, [1976] 1 RCS 580
2 Atcor Ltd v Continental Energy Marketing Ltd, [1996] AJ No 131, [1996] 6 WWR 274, 38 Alta LR (3d) 229, 178 AR 372, 25 BLR (2d) 1, 61 ACWS (3d) 75
Determining Which Business Venture is Right for You!
Author: Sarah Nadon – Law Student
Edited By: Ryan Carson
Partnership agreements may arise informally through the shake of a hand; however, rarely is that the best course to follow when creating a partnership. Partnerships are very much like sole proprietorships however they involve two or more people.
Most partnerships, either big or small, operate subject to an agreement among the partners that lays out specific rights and obligations of every party, as well as provisions for running the company, both day to day and in the event that someone dies, or the partnership is dissolved. This article will examine the pros and cons of joint ventures and shareholders agreements as well as common mistakes that occur when entering into a business venture.
Shareholders agreement
A shareholder’s agreement is an agreement between the shareholders of an existing corporation. The agreement is used to assure that owners’ rights are protected. Shareholders agreements are very fact specific and are tailored to the unique circumstances of the parties.1
This type of agreement typically deals with two basic areas:
• Control and management of the corporation; and
• Termination of the relationship of the shareholder, whether by transfer of the shares to third parties, a buy-out of the shares by a different shareholder or by liquidation of the corporation.2
In a shareholder’s agreement each party is responsible for the actions of the other shareholders. Shareholders share risk, costs and profits with one another.
A shareholder’s agreement is an agreement between the shareholders of an existing corporation. The agreement is used to assure that owners’ rights are protected. Shareholders agreements are very fact specific and are tailored to the unique circumstances of the parties.1
This type of agreement typically deals with two basic areas:
• Control and management of the corporation; and
• Termination of the relationship of the shareholder, whether by transfer of the shares to third parties, a buy-out of the shares by a different shareholder or by liquidation of the corporation.2
In a shareholder’s agreement each party is responsible for the actions of the other shareholders. Shareholders share risk, costs and profits with one another.
Joint Venture
A joint venture involves two or more businesses or individuals combining their resources and expertise to achieve a shared goal. Joint ventures are usually undertaken by previously established businesses. Joint ventures are relatively new meaning unlike corporations, they are the least regulated. Much like partnerships, joint ventures do involve a fiduciary duty.3
Joint ventures are typically created by express agreement, which will define the rights, obligations and prospective liability of each participant in the joint venture.4 Unlike a shareholder’s agreement, each party is responsible for the debts they acquire but split the profits according to the agreement.
The main difference between a joint venture and a shareholder agreement is whether the agreement is between one company or several, as a shareholder’s agreement cannot be created with several different companies.
A joint venture involves two or more businesses or individuals combining their resources and expertise to achieve a shared goal. Joint ventures are usually undertaken by previously established businesses. Joint ventures are relatively new meaning unlike corporations, they are the least regulated. Much like partnerships, joint ventures do involve a fiduciary duty.3
Joint ventures are typically created by express agreement, which will define the rights, obligations and prospective liability of each participant in the joint venture.4 Unlike a shareholder’s agreement, each party is responsible for the debts they acquire but split the profits according to the agreement.
The main difference between a joint venture and a shareholder agreement is whether the agreement is between one company or several, as a shareholder’s agreement cannot be created with several different companies.
How to decide between a joint venture and a corporation
Corporations are another form of a business entity structure made available to the public. A corporation is when a company’s owners operate as a single business entity and is formed by filing articles of incorporation, while a joint venture is a partnership between two or more businesses that want to work together towards a common goal.5 A corporation has a separate legal entity from its shareholders meaning it has the same rights as an individual. In Canada, corporations have all the legal rights of a person therefore they are eligible for loans, can carry on business, sue or be sued. Corporations offer limited liability and is one of the most common business structures in Canada.
Since joint ventures have no statute to govern them, they are strictly governed by the contract made between the parties. Joint ventures allow flexibility for the parties and are not considered to be a taxpayer under Canadian tax legislation while corporations are taxed by both the Ontario and federal income taxes.6
When choosing a business entity, one should consider the legal liability, the tax implications, the cost of formation, the ongoing administration and the flexibility they desire. In addition, how the entity is governed may also be an important consideration.
Corporations are another form of a business entity structure made available to the public. A corporation is when a company’s owners operate as a single business entity and is formed by filing articles of incorporation, while a joint venture is a partnership between two or more businesses that want to work together towards a common goal.5 A corporation has a separate legal entity from its shareholders meaning it has the same rights as an individual. In Canada, corporations have all the legal rights of a person therefore they are eligible for loans, can carry on business, sue or be sued. Corporations offer limited liability and is one of the most common business structures in Canada.
Since joint ventures have no statute to govern them, they are strictly governed by the contract made between the parties. Joint ventures allow flexibility for the parties and are not considered to be a taxpayer under Canadian tax legislation while corporations are taxed by both the Ontario and federal income taxes.6
When choosing a business entity, one should consider the legal liability, the tax implications, the cost of formation, the ongoing administration and the flexibility they desire. In addition, how the entity is governed may also be an important consideration.
What kind of questions should be answered before talking to a lawyer?
Before speaking to a lawyer, one will want to have an idea of which type of agreement they would like drafted. Next, they should know who the parties to the agreement will be, when the agreement will end, if ever. The parties to the agreement should also know what the objective of the agreement is in order to help the lawyer draft a proper contract.
What to include in an agreement?
Shareholders agreement:
The right to remove directors
Terms to protect minority share holders
Restrictions on how and when someone can dispose of their shares
Limitations on what actions a director can take
A business plan to assure that all shareholders are on the same page
How to resolve a shareholder dispute
The right to first refusal clause
Joint Venture:
Type of joint venture
Benefits and risks
Financial contribution each party will make
Objective of the joint venture
Ownership of the intellectual property created by the joint venture
How liabilities, profits and losses are shared
Common mistakes
If in a limited partnership, limited partners are not allowed to take an active role in management of the partnership, as it exposes the limited partners to the same level of liability as the general partner
Not choosing the right business entity
Starting a venture without a business entity
Not filing the proper documentation for the business entity
Excluding important clauses from the business contract
Inadequate capitalization
Ignoring intellectual property and getting sued for infringement
Objectives of a joint venture are not 100% clear and communicated with everyone
Disclaimer
The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Carson Law, Carson IP, or their own legal counsel regarding any specific legal issues. Carson Law does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose.
References
1 The Editorial Staff of LexisNexis Canada in co-operation with The Institute of Chartered Secretaries and Administrators in Canada, Canadian Corporate Secretary’s Guide (LexisNexis Canada, 2003) (loose-leaf updated 2020), (QL)
2 Ibid.
3 Meinhard v. Salmon, 62 A.L.R. 1 at 4-5 (N.Y.C.A., 1928)
4 Chitel v. Bank of Montreal, [2002] O.J. No. 2170 (Ont. S.C.J.
5 Canada Business Corporations Act, RSC 1985, c C-44, Part II.
6 Neil Hazan, “Joint Ventures in Canada: Overview” Joint Ventures Law Global Guide, August 1 2017.
Kawhi Leonard Loses Copyright Lawsuit against Nike
Author: Sarah Nadon – Law Student
Edited By: Ryan Carson
When many see the “Klaw” logo, they associate it with the former Raptors all-star, Kawhi Leonard. The logo was created by Nike Corp based on a sketch drawn by Kawhi Leonard when he was in school, but just because many people associate the logo with Leonard does not mean that he is its rightful owner. According to a recent ruling by a United-States federal judge, the logo created does not belong to him; it belongs to Nike.1
Last summer, there was a widely reported feud between Nike, the largest sports apparel company and Kawhi Leonard over the ownership of the “Klaw” logo. The logo is of Leonard’s large hand, which inside contains his initials “KL” and the number 2, which he had worn on his jersey for much of his basketball career.2 Leonard was adamant that he had the idea to create a logo which incorporated his initials and the number "2" into a drawing of his hand and before entering the Nike Contract, he created the "Leonard Sketch" as a draft of that idea. Over the course of the next few years, Nike developed variations of the logo, while Leonard states that he had the final say over the logo's final appearance.
In 2018 when the endorsement deal ended, Nike and Leonard parted ways, and Leonard demanded a court to declare that he is the sole owner of the logo and that Nike fraudulently registered the logo with the United-States Copyright Office in Washington D.C.3 While Leonard was filing his lawsuit, Nike disputed Leonard’s story and sued him for copyright infringement, breach of contract and fraud.
Litigation originally began in Southern California but moved to the U.S. District Court for the District of Oregon, giving Nike a home-court advantage. Judge Michael Mosman presided over the case.4 On April 22, 2020, Mosman J. heard Nike’s Motion for Judgement. Mosman J. stated that ownership over the “Klaw” design turns on the Nike contract entered into by Leonard. Paragraph 8 of the contract states:
OWNERSHIP OF NIKE MARKS, DESIGNS & CREATIVES.
(a) [Leonard] acknowledges that NIKE exclusively owns all rights, title and interest in and to the NIKE Marks and that NIKE shall exclusively own all rights, title and interest in and to any logos, trademarks, service marks, characters, personas, copyrights, shoe or other product designs, patents, trade secrets or other forms of intellectual property created by NIKE . . . or [Leonard] in connection with this Contract;5
The judge held that the Nike contract established Nike’s ownership of the logo because the “klaw” logo was (1) a new piece of intellectual property and (2) created “in connection” with the Nike contract.
While throughout the case, Nike asserted that this was a tale of two images, Leonard consistently refers to the “Leonard Logo.”6 This is because Leonard’s theory is that no new intellectual property was created over the course of the Nike contract; instead, the “Klaw” logo is the finished result of mere modifications to the logo Leonard has created independently of Nike. The judge rejected that theory during oral arguments.
Next, the judge analyzed whether the “Klaw” design was created “in connection with” the Nike contract. If the logo was created in connection with the contract, Nike owns it. Leonard’s argument was that the contractual language “in connection with” is ambiguous and unconvincing.7 The purpose of the Nike contract was to pay Leonard for “the use of [Leonard]’s personal services and expertise in the sport of professional basketball and [Leonard]’s endorsement of the Nike brand and use of Nike products.”8 According to Leonard, at some point during the contract, Nike wanted to create a logo for the merchandise to be sold under Leonard’s Nike contract. The “Klaw” logo was created and affixed to merchandise that Leonard wore and endorsed and Nike sold.9 Not only was this activity done in connection with the Nike contract, but it also represented the entire point of the Nike contract. Since the logo was created under the Nike contract for the purpose of endorsing both Nike and Leonard, Nike owns the design and the right to register a copyright for it.
Furthermore, the judge granted in part and denied in part Nike’s counterclaims, which included a declaratory judgement of copyright ownership, copyright infringement, copyright right cancellation for fraud on the copyright office, breach of contract paragraph 8, breach of contract paragraph 13 and breach of contract paragraph 21.10 The judge granted breach of contract under paragraph 21 as the contract states that any dispute arising under the contract should be litigated in an Oregon court. Leonard filed his action in the Southern District of California.
Nike was granted copyright ownership and, in part, breach of contract but denied judgement on other counterclaims. Leonard’s lawyers are currently weighing their options on what to do next.
In 2018 when the endorsement deal ended, Nike and Leonard parted ways, and Leonard demanded a court to declare that he is the sole owner of the logo and that Nike fraudulently registered the logo with the United-States Copyright Office in Washington D.C.3 While Leonard was filing his lawsuit, Nike disputed Leonard’s story and sued him for copyright infringement, breach of contract and fraud.
Litigation originally began in Southern California but moved to the U.S. District Court for the District of Oregon, giving Nike a home-court advantage. Judge Michael Mosman presided over the case.4 On April 22, 2020, Mosman J. heard Nike’s Motion for Judgement. Mosman J. stated that ownership over the “Klaw” design turns on the Nike contract entered into by Leonard. Paragraph 8 of the contract states:
OWNERSHIP OF NIKE MARKS, DESIGNS & CREATIVES.
(a) [Leonard] acknowledges that NIKE exclusively owns all rights, title and interest in and to the NIKE Marks and that NIKE shall exclusively own all rights, title and interest in and to any logos, trademarks, service marks, characters, personas, copyrights, shoe or other product designs, patents, trade secrets or other forms of intellectual property created by NIKE . . . or [Leonard] in connection with this Contract;5
The judge held that the Nike contract established Nike’s ownership of the logo because the “klaw” logo was (1) a new piece of intellectual property and (2) created “in connection” with the Nike contract.
While throughout the case, Nike asserted that this was a tale of two images, Leonard consistently refers to the “Leonard Logo.”6 This is because Leonard’s theory is that no new intellectual property was created over the course of the Nike contract; instead, the “Klaw” logo is the finished result of mere modifications to the logo Leonard has created independently of Nike. The judge rejected that theory during oral arguments.
Next, the judge analyzed whether the “Klaw” design was created “in connection with” the Nike contract. If the logo was created in connection with the contract, Nike owns it. Leonard’s argument was that the contractual language “in connection with” is ambiguous and unconvincing.7 The purpose of the Nike contract was to pay Leonard for “the use of [Leonard]’s personal services and expertise in the sport of professional basketball and [Leonard]’s endorsement of the Nike brand and use of Nike products.”8 According to Leonard, at some point during the contract, Nike wanted to create a logo for the merchandise to be sold under Leonard’s Nike contract. The “Klaw” logo was created and affixed to merchandise that Leonard wore and endorsed and Nike sold.9 Not only was this activity done in connection with the Nike contract, but it also represented the entire point of the Nike contract. Since the logo was created under the Nike contract for the purpose of endorsing both Nike and Leonard, Nike owns the design and the right to register a copyright for it.
Furthermore, the judge granted in part and denied in part Nike’s counterclaims, which included a declaratory judgement of copyright ownership, copyright infringement, copyright right cancellation for fraud on the copyright office, breach of contract paragraph 8, breach of contract paragraph 13 and breach of contract paragraph 21.10 The judge granted breach of contract under paragraph 21 as the contract states that any dispute arising under the contract should be litigated in an Oregon court. Leonard filed his action in the Southern District of California.
Nike was granted copyright ownership and, in part, breach of contract but denied judgement on other counterclaims. Leonard’s lawyers are currently weighing their options on what to do next.
Disclaimer
The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Carson Law, Carson IP, or their own legal counsel regarding any specific legal issues. Carson Law does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose.
References
1 Sports Illustrated, News Release, “Kawhi Leonard Loses Copyright Lawsuit Against Nike Over Logo (April 23, 2020) https://www.si.com/nba/2020/04/23/kawhi-leonard-loses-lawsuit-against-nike.
2 Ibid.
3Ibid.
4 Ibid.
5Nike Contract [16-1] at 7.
6Kawhi Leonard v Nike Inc., ( D. Or. 2020)
7Ibid.
8 Ibid.
9Ibid.
10Ibid.
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Should You Consider A Cohabitation Agreement?
Author: Stacey Staios - Articling Student
Edited By: Ryan Carson
A cohabitation agreement is an agreement signed by two unmarried individuals who are living together or intend to live together in the future. When a couple decides to live together, a cohabitation agreement can clearly set out the rights and obligations of each party, either in the event of a breakdown of the relationship or upon the passing of one of the partners.
There are many benefits to entering into a cohabitation agreement, regardless of whether the parties intend to marry or remain in a common law relationship. For the purpose of support obligations, common law couples are defined in Ontario as couples who have lived together continuously for no less than three years, or one year if they are in a relationship of some permanence and have a child together.1
When it comes to the division of property, there is a distinction between the rights available to common law couples and married couples. If one party in a common law relationship passes away without a will, the surviving common law partner does not have an automatic right to their spouse’s property under the Family Law Act like a married couple would, regardless of the length of their relationship or cohabitation. Rather, they must have the courts determine their share via a claim in equity under a constructive trust, which can be overwhelming, costly and time consuming.
Couples who decide to enter into a cohabitation agreement can ‘bypass’ these legal limitations and set out specifically what property they wish to leave behind to the surviving common law spouse. In the event of a breakdown of the relationship, the parties can, using a cohabitation agreement, contract out of any right or obligation that would otherwise take place without an agreement, including spousal support and the division of property.
Couples who decide to enter into a cohabitation agreement can ‘bypass’ these legal limitations and set out specifically what property they wish to leave behind to the surviving common law spouse. In the event of a breakdown of the relationship, the parties can, using a cohabitation agreement, contract out of any right or obligation that would otherwise take place without an agreement, including spousal support and the division of property.
For some, entering into a cohabitation agreement under section 53(1) of the Family Law Act may be advantageous, particularly if there is a significant disparity in the parties income, assets or debts. Such agreements can keep these assets separate and have the couple remain financially independent. In the event that the couple decides to marry at a later date, a cohabitation agreement can transition into a marriage contract under section 53(2) of the Family Law Act. 2
When it comes to rights and obligations that both parties wish to contract out of using a cohabitation agreement, section 56 of the Family Law Act is applicable. This section states that a domestic contract, relating to the custody of or access to the child may be set aside and disregarded by the court if, in the opinion of the court, the contract is not in the best interest of the child.3 Further, section 56(4) of the Act states that a domestic contract may also be set aside if (a) a party failed to disclose any significant assets, debts or liabilities, or (b) if a party did not understand the nature or consequence of the domestic contract. Therefore, contingent on the parties satisfying these requirements, their domestic contract will stand in court.
Given that there is no statutory right to the division of property among common law couples, a cohabitation agreement may be entered into by those who wish to remain unmarried and have a division of property regime. It is important to have a qualified and experienced lawyer draft an agreement of this nature, as there are many factors and variables that can affect its validity. Whether you are inquiring about a cohabitation agreement, require one to be drafted, or need it to be reviewed by a lawyer, our team is here to help. At Carson Law our lawyers have many years of experience helping families in Burlington, Ontario and its surrounding areas create these domestic contracts in a cost effective and practical way.
Disclaimer
The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Carson Law, Carson IP, or their own legal counsel regarding any specific legal issues. Carson Law does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose.
References
1 Ontario Family Law Act, s.29.
2 Ontario Family Law Act, s.53(2)
3Ontario Family Law Act, s.56
.
Trademarks, .com Domain Names, and Consumer Confusion
Over the past several years, e-commerce use has been growing exponentially, as consumers and corporations alike turn to this convenient method of exchange. As this trend increases, so too does the importance of a corporation’s domain name. Domain names (the words we see before “.com” in a given website’s URL) are consumers’ first impression of a corporation’s product or service, as their wording gives a taste of what the website will hold. Domain names are also often connected to a website’s meta tags, which are used to increase the likelihood that the website will appear as a result during search engine use.
Naturally, many corporations use their trademarked names as their domain names. This way, consumers who are familiar with the corporation’s mark can guess what the website’s URL will be, or can likely find the corporation’s website by entering the corporation’s name into a search engine.
But corporations using their trademarks as their domain names face a problem: other website creators may have domain names that are extremely similar to a corporation’s own domain name. Consumers guessing a corporation’s domain name, or typing a corporation’s name in a search engine, may mistakenly end up at another site with a similar domain name. Alternatively, consumers typing in the correct domain name of a corporation may also be automatically redirected to another site with a similar domain name.
In these cases, a corporation loses business from consumers who never arrive at the corporation’s site. These problems get worse when someone intentionally creates a site with a similar domain name to that of a site of a well-known mark; or when someone creates a site with a similar domain name to a corporation’s and also provides similar products or services to that corporation.
So, what can corporations do in these situations? There are several legal avenues that a corporation can take when their trademark or domain name is tarnished in these ways, and we will outline some of them here.
Deciding on the Best Course of Action
In these types of situations, a corporation’s choice of action will affect the remedy that it can receive. A corporation should choose its course of action based on its needs. For example, if a corporation mainly wants to stop consumers from being confused about the whereabouts and/or content of the corporation’s website, it will want to pursue a course of action whose remedy stops other sites from using domain names similar to their own. Similarly, if a corporation mainly wants to be compensated for the business lost, it will want to pursue a course of action whose remedy is damages.
For Stopping Consumer Confusion: ICANN Dispute Resolution Policy
Disputes over .com domain names are sometimes often regulated by the ICANN Uniform Domain Name Dispute Resolution Policy (UDRP). (Similar policies exist for other sorts of domain names—e.g., the CIRA process for .ca domain names—but discussing them goes beyond the scope of this article.) The remedies available to a complainant through this process are limited to the cancellation of the domain name or the transfer of the domain name registration to the complainant.
The Uniform Domain Name Dispute Resolution Policy (UDRP) applies to every registrant of a .com domain name by virtue of their obtaining it, because every accredited domain name registrar has adopted this mandatory process. Registrants must go through this dispute resolution process if another domain name user has brought a complaint against them asserting that they have done all of the following:
The domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights; AND
The domain name holder has no rights or legitimate interests in respect of the domain name; AND
The domain name has been registered and is being used in bad faith.
For Damages: Legal Action of Passing Off
In many cases, complainants find the UDRP too narrow: either the policy does not adequately cover their concern, or the remedies are insufficient for their needs. The policy does not, however, preclude complainants from also bringing a legal action in court. The legal action that best lends itself to many domain name disputes is passing off.
Passing off in the context of domain name disputes requires that the defendant’s use of a domain name imports the reputation or knowledge of the plaintiff’s service or product into the consumer’s mind when they go to the defendant’s site (British Columbia Automobile Assn v OPEIU). In this way, the plaintiff is essentially trying to stop the defendant from capitalizing on the goodwill attached to the plaintiff’s mark.
Remedies for passing off can include interim and interlocutory injunctions; compensatory damages; and, if the defendant repeats their behaviour, or if it is otherwise a marked departure from the ordinary standards of behaviour by being planned or deliberate, punitive damages (Dentec).
Note that there is a two-year limitation period on this type of action.
Passing off requires the plaintiff to prove three criteria (Ciba-Geigy Canada Ltd v Apotex Inc, 1992 CanLII 33, SCC [Ciba-Geigy]):
Goodwill for the plaintiff’s company exists in the minds of consumers. This criterion is especially important in domain name disputes if a corporation conducts a significant portion of its business through the site, because, “[by] implication, they attach their goodwill to their services supplied through their ‘get-up’, their trade name” (Airline Seat Co v 1396804 Ontario Inc, 2000 CanLII 22666, ONSC [Airline Seat Co] at para 13).
The public was deceived due to a misrepresentation, so that they are led to believe that there is some business connection or association between the parties (i.e., so that confusion exists).
Actual or potential damage will occur to the plaintiff. In cases of passing off, potential damage is presumed when it is caused by the plaintiff losing control over its reputation through a misrepresentation (Ciba-Geigy). The defendant’s use of a domain name similar to the plaintiff’s can cause this loss of control (Law Society of British Columbia).
Again, the complainant should obtain independent proof of the above.
Other Possible Legal Actions
This article has mainly explained the ICANN dispute resolution process and the tort of passing off, but below we will describe some other causes of action that may be more appropriate to a complainant’s situation. Still, these causes of action describe situations where domain name similarity creates confusion for consumers about the location and/or content of the corporation’s website.
Trademark Infringement: A plaintiff may seek an interlocutory injunction on the use of the confusing domain name as remedy for breach of trademark. To achieve this remedy, the plaintiff must meet a three-part test: first, there must be a serious issue to be tried; second, the plaintiff must suffer irreparable harm without the injunction; and third, there is a balance of convenience.
Breach of Copyright: A breach of copyright claim may help corporations whose consumers, in trying to find the corporation’s website, find websites that have used the corporation’s website design, logo, or other artistic features. To succeed at this claim, the plaintiff must show that the defendant reproduced original artistic work belonging to the plaintiff without the plaintiff’s permission.
Defamation: A defamation claim can help corporations whose consumers, in trying to find the corporation’s website, come across websites that are intentionally trying to diminish the corporation’s reputation. To succeed at this claim, the plaintiff must show that the words in question have been published, that the words refer to the plaintiff, and that the words—in their ordinary or natural meaning, or in an extended meaning—are defamatory of the plaintiff.
Alternative Dispute Resolution during COVID-19
With the Ontario Court of Justice limiting access to courthouses to help prevent the spread of COVID-19, there are still ways to settle a dispute without going to court. This method for resolving a legal dispute outside of the courts is called an Alternative Dispute Resolution (ADR). With the current state of affairs, this may be an appealing option to help parties settle their differences, rather than to wait for the courts to open and be backlogged with cases.
Below are some of the benefits of using the most common forms of Alternative Dispute Resolution, which are: Collaborative Law, Mediation and Arbitration.
Collaborative Law
• Attorney assistance – each participant has their own lawyer 2
• Faster agreements – many cases take 4-6 months2
• Client control – clients decide the terms of their own agreements with help from their Collaborative attorneys. A final agreement will not be reached until both parties agree to it.2
• Maintains privacy – Participants of Collaborative law cases are able to decide what goes into the documents, which will become public record.2
• Preservation of relationships – Collaborative Law helps to focus on communicating with each other instead of attacking.2
Mediation
• A Mediator is an unbiased, impartial person who helps each party in their negotiations to help find mutually acceptable, practical solutions.5
• Meetings can be scheduled, depending on each parties’ availability, to occur within days.1
• Flexible formatting such as regular or on-demand follow up.1
Arbitration
• Decision of an arbitrator is legally binding, as if it were made by a judge.4
• A speedy and customized process tailored to the dispute issue.4
• Private proceeding for reputation or business confidentiality .4
• Can adhere to the current social distancing requirements.4
Alternative Dispute Resolutions are used in a way that is appropriate and best suited for both parties. There are other forms of ADR and the use of a specific method will depend on the nature of that particular dispute.3
• Attorney assistance – each participant has their own lawyer 2
• Faster agreements – many cases take 4-6 months2
• Client control – clients decide the terms of their own agreements with help from their Collaborative attorneys. A final agreement will not be reached until both parties agree to it.2
• Maintains privacy – Participants of Collaborative law cases are able to decide what goes into the documents, which will become public record.2
• Preservation of relationships – Collaborative Law helps to focus on communicating with each other instead of attacking.2
Mediation
• A Mediator is an unbiased, impartial person who helps each party in their negotiations to help find mutually acceptable, practical solutions.5
• Meetings can be scheduled, depending on each parties’ availability, to occur within days.1
• Flexible formatting such as regular or on-demand follow up.1
Arbitration
• Decision of an arbitrator is legally binding, as if it were made by a judge.4
• A speedy and customized process tailored to the dispute issue.4
• Private proceeding for reputation or business confidentiality .4
• Can adhere to the current social distancing requirements.4
Alternative Dispute Resolutions are used in a way that is appropriate and best suited for both parties. There are other forms of ADR and the use of a specific method will depend on the nature of that particular dispute.3
For more information on the benefits of Alternative Dispute Resolutions, please visit any one of the below organizations within Canada that specialize in ADR.
ADR Institute of Canada (ADRIC)
Intellectual Property Institute of Canada (IPIC)
IP Neutrals of Canada
ADR Institute of Canada (ADRIC)
Intellectual Property Institute of Canada (IPIC)
IP Neutrals of Canada
Disclaimer
The content on this web site is provided for general information purposes only and does not constitute legal or other professional advice or an opinion of any kind. Users of this web site are advised to seek specific legal advice by contacting members of Carson Law, Carson IP, or their own legal counsel regarding any specific legal issues. Carson Law does not warrant or guarantee the quality, accuracy or completeness of any information on this web site. The articles published on this web site are current as of their original date of publication, but should not be relied upon as accurate, timely or fit for any particular purpose.
References
1Birnberg, G. (2020, March). The Business Case for Neutral Facilitation in the Days of the Coronavirus (COVID-19). Retrieved April 21, 2020, from https://www.mediate.com/articles/birnberg-neutral-covid.cfm 2Forest, C. (2019, February 20). Benefits of Collaborative Law: Win-Win Agreements. Retrieved April 20, 2020, from https://www.keepoutofcourt.com/benefits-of-collaborative-law/ 3Intellectual Property Office. (2018, September 25). Alternative dispute resolution. Retrieved April 21, 2020, from https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr04443.html 4Munro,, L. C. (2020, April 2). Arbitration COVID-19 Benefits: Lerners LLP London & Toronto. Retrieved April 21, 2020, from https://www.lerners.ca/lernx/arbitration-covid-19/ 5Waterous Holden Amey Hitchon LLP. (2019). Alternatives to Court – ADR. Retrieved April 21, 2020, from http://waterousholden.com/alternatives-to-court-adr/?gclid=Cj0KCQjws_r0BRCwARIsAMxfDRiTkhF4NAcKUaWz46-QOHXqMuK-N51HIuB38GVqssDdNW0hLl3BZcwaAro-EALw_wcB
It's Business As Usual ... It Just Looks A Little Different
For the signing of any legal documents, we will be moving forward with this new two step process:
We will be using a video / audio conference platform called “Zoom”, which has been approved by the Law Society of Ontario. Please visit Zoom’s Frequently Asked Questions page for information on how this web-based service works.
We will be sending the signing package and documents via courier prior to your call. The two couriers we will be using are Purolator and Zoom Service (different business from the above online platform). The package will be marked in all areas where you must sign. Please do not sign any documents prior to the Zoom call, as all signing must take place while on the Zoom video call for verification. During the Zoom call, we will review each page carefully and one at a time. Once we finish the call, we will arrange for the same courier to retrieve the documents from you and return them to our office for final processing of the file.
If you have any questions or concerns, please don’t hesitate to ask.
The Proper Use of Insurance Series - Episode 4
Ryan Carson, owner and founder of Carson Law, sits down with Senior Insurance Specialist, Matthew Stevenson of RBC Insurance, in this four episode series on discussing the use and benefits of Insurance.
To contact Matthew Stevenson, please Click here or call 365-777-2762
The Proper Use of Insurance Series - Episode 3
Ryan Carson, owner and founder of Carson Law, sits down with Senior Insurance Specialist, Matthew Stevenson of RBC Insurance, in this four episode series on discussing the use and benefits of Insurance.
To contact Matthew Stevenson, please Click here or call 365-777-2762
The Proper Use of Insurance Series - Episode 2
Ryan Carson, owner and founder of Carson Law, sits down with Senior Insurance Specialist, Matthew Stevenson of RBC Insurance, in this four episode series on discussing the use and benefits of Insurance.
To contact Matthew Stevenson, please Click here or call 365-777-2762
The Proper Use of Insurance Series - Episode 1
Ryan Carson, owner and founder of Carson Law, sits down with Senior Insurance Specialist, Matthew Stevenson of RBC Insurance, in this four episode series on discussing the use and benefits of Insurance.
To contact Matthew Stevenson, please Click here or call 365-777-2762
Copyrights 101
What is Copyright?
Copyright is the exclusive legal right to produce, reproduce, publish, or perform an original literary, artistic, dramatic, or musical work. This legal right is normally held by the creator of the original work in question.
The purpose of a copyright is to allow the owner to control how their work is used, which in turn preserves its value (monetary or otherwise). Copyright achieves this end by making it illegal for anyone other than the copyright owner to use the work without the owner’s permission.
Canadian copyright law honours this purpose in trying to protect the rights of copyright owners. However, it also tries to balance protecting owners’ rights and promoting the public interest in the creation and distribution of works. In other words, the law recognizes that it is important for Canadians to create as freely as possible, even if this sometimes means limiting copyright owners’ rights.
Do I Have Copyright Over My Work?
In Canada, almost all original works are automatically copyrighted by virtue of their creation. A copyright exists for the lifetime of the creator, plus the remainder of the calendar year in which the author dies, plus fifty years after that. Following this period, the work loses its copyright, becoming public domain. For example, if Tom wrote a book at any point in his life, and then died on October 3rd, 2000, his copyright would exist until December 31st, 2050.
There are some exceptions to this term of copyright protection, depending on who the copyright owner is, or whether the owner is known.
What is the Difference Between Having a Copyright and Having a Registered Copyright? How Can I Register My Copyright?
As mentioned earlier, almost all original works are automatically copyrighted at the time of their creation. Registering a copyright with the Canadian Intellectual Property Office provides the owner with a certificate documenting that this copyright exists. This certificate can be useful if ever a question of copyright ownership or infringement arises, because the certificate can be used in court as proof of the existence and ownership of a copyright.
Costs for the registration process are available on the CIPO website, linked here.