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INSTRUCTOR’S
MANUAL
Richard A. Yates Douglas Kennedy
BUSINESS LAW IN
CANADA
Twelfth Edition Richard A. Yates Teresa Bereznicki-Korol Trevor Clarke Dean A. Palmer
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Copyright © 2020 Pearson Canada Inc.1
Chapter 1 Managing Your Legal Affairs Learning Objectives Discussion A “sophisticated client” understands the role of the lawyer, and their own role as client. This involves knowing when and how to hire a lawyer, the costs involved and what can be done if the lawyer is not meeting your expectations. Good business decisions can only be made with consideration of appropriate laws, whether the client is able to access that information for themself, or through the services of a lawyer. A sophisticated client also understands the importance of evidence, and may change their procedures and those of the business in order to make sure the evidence is there in the event of a dispute.The client is the ultimate decision maker, but makes those decisions with the advice of a number of experts, of which the lawyer is one. If clients deem other business factors to be of greater importance, they may choose to accept some legal risk, but it is an informed decision. Lawyers must follow the instructions of their clients unless they are illegal or unethical (although a lawyer may always resign).The decision about when to hire a lawyer starts when decisions need to be made as to how the business will be organized, and whether to create a new business or buy an existing one. It allows business owners to minimize their risks and make sure they are in compliance with all laws. This would also apply to decisions about the premises, financing, existing or new contracts, intellectual property and, finally, selling the business. For less significant decisions, clients may choose to inform themselves, through the internet, or from the resources listed throughout this textbook and in MyBusLawLab. Sophisticated clients will know when to do research themselves and, if unable to obtain the information or understand the information found, to seek legal advice. Small claims court trials are often conducted, due to the relatively low monetary limits, unless the legal issues are too complex for the client to handle themselves. Criminal matters should nearly always be handled by legal counsel.Finding an appropriate lawyer is difficult. Referrals from trusted friends or •Explain the meaning of “sophisticated client” •Examine the role of the lawyer •Identify when to hire a lawyer and when to represent yourself •Explain how to find an appropriate lawyer •Review how lawyers bill their clients •Describe legal aid •Outline the procedure to follow to complain about your lawyer •Discuss the ethics of lawyers and of clients
EXPLAIN THE
MEANING OF
“SOPHISTI-
CATED CLIENT”
EXAMINE THE
ROLE OF THE
LAWYER
IDENTIFY
WHEN TO HIRE
A LAWYER
AND WHEN TO
REPRESENT
YOURSELF
EXPLAIN HOW 2 / 4
Instructor’s Manual for Business Law in Canada, 12 th Edition Copyright © 2020 Pearson Canada Inc.2 associates with the same type of legal problems are good. Some provincial law societies or branches of the Canadian Bar Association also have lawyer referral services that provide names of lawyers who practice in specific areas of law. You may have an initial consultation for little or no cost, and then decide if you wish to pursue the matter and hire one of them. If not going through one of those services, initial consultation costs will vary and should be confirmed with the lawyer in advance. The lawyer you choose should be someone who you think may be suitable to establish an ongoing relationship with your business.
Lawyers bill their clients for services either by a fixed fee, an hourly rate or by a contingency fee based on a percentage of the money recovered on behalf of the client. Clients are also responsible for paying disbursements, the lawyer’s out-of- pocket expenses incurred, such as filing fees, long-distance telephone charges, etc.Sometimes a lawyer will require a financial retainer to start a file, which operates as a deposit against legal work performed.Legal aid may be available for people with low income, but the eligibility varies from province to province, so it’s best to check with the administrators of the program in your province. What types of legal services are covered also varies, and it is generally not available for business issues. Duty counsel is often available at no charge in criminal court to provide advice, but not representation.Law is a self-governing profession, with provincial law societies that serve this function. Fee complaints are dealt with differently from province to province.Complaints about a lawyer’s conduct are dealt with through the law society, which will have a resolution process that could include mediation, investigation and formal hearings, with penalties for wrongdoing. Claims for compensation are subject to limitation periods, as is any other action.Professional and ethical obligations of lawyers are set out in rules of professional conduct established by each province’s law society. The vast majority of lawyers meet these standards, but as with any profession, there are a few that do not. If this occurs, the client needs to take appropriate action on a timely basis.There is no code of conduct for business people, and there have recently been a number of well publicized examples of breaches of ethical conduct by high profile business people. This affects the public’s perception of the integrity of enterprises in our country and the advisability of doing business here. Each business should make a commitment to ethical behaviour by preparing a code of conduct for their employees. It needs to include issues such as conflicts of interest, use of corporate assets and opportunities, confidentiality, fair dealing, compliance with laws and reporting of unethical or illegal behaviour within the business. It needs to reflect the business’ core ethical values and principles, in order to encourage ethical behaviour on the part of all those associated with the business. This, in turn, can enhance the long term success of the business.
TO FIND A
GOOD
LAWYER
REVIEW
HOW
LAWYERS
BILL THEIR
CLIENTS
DESCRIBE
LEGAL AID
OUTLINE THE
PROCEDURE
TO FOLLOW
TO COMPLAIN
ABOUT YOUR
LAWYER
DISCUSS THE
ETHICS OF
LAWYERS
CODE OF
BUSINESS
CONDUCT 3 / 4
Chapter 1: Managing Your Legal Affairs
Copyright © 2020 Pearson Canada Inc.3 Answers to Questions
- Explain the meaning of “sophisticated client”.
- Why should the owner of a small business have a lawyer on “the team”?
- Distinguish the role of the client from the role of the lawyer.
- “The elimination of ‘solicitor-client privilege’ would significantly undermine the integrity
- What are some examples of decisions that owners of small businesses make? What role can
- What role has the computer played with respect to the solicitor-client relationship?
- “It is a good idea to hire a lawyer when you have been charged with a crime.” True or
- When you are trying to find a lawyer to help you, what are some sources of lawyer’s
- What is the primary purpose of an initial consultation with a lawyer?
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Sophisticated clients are confident, knowledgeable, up-to-date and understand the role of a lawyer. As well, they know when to represent themselves and when to hire a lawyer, and the costs involved when a lawyer is hired.
A lawyer is an expert, providing relevant advice to the client, which allows the client to make an informed decision.
The client is the decision maker, who consults a number of experts, including lawyers, in order to make decisions. Lawyers are experts in their field who provide advice, and who must follow the instructions of the client.
of the Canadian legal system.” True or false? Explain your answer.True. Solicitor-client privilege ensures full and frank disclosure between clients and their lawyers.The value of the lawyer’s advice will be greatly reduced if it is based on incomplete information.
a lawyer play with respect to the making of these decisions?The legal form of the business, whether to buy an existing business or create a new one, what are the relevant laws and regulations affecting the business and what constitutes compliance, issues with regard to purchase or lease of business premises, funding of the business, contracts with employees, suppliers and customers, intellectual property and, finally, sale of the business.
Computers allow clients to research easily accessible legal information online, rather than having to consult a lawyer for every decision.
false? Explain your answer.True. The stakes are high. If convicted, you will be punished and have a criminal record.
names?Sources include referrals from friends or relatives, provincial law societies, lawyer referral services, provincial branches of the Canadian Bar Association, advertisements and the Yellow pages.
To decide whether the lawyer is suitable for you to retain. If so, then the lawyer will decide if it is agreeable to represent you.
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