Legalese Dictionary

A Brief Note on the Canadian Pension Plan (CPP) Disability Benefits

Posted in: "All, "Brief Note" Series, Administrative Law, Business Development, Legalese Dictionary by Admin | No Comments Monday, November 16, 2009

The Canadian Pension Plan provides disability pension benefits to persons with disabilities. To become eligible to the benefits, a claimant must meet the financial contribution threshold during the years prior to the claim.

The tests for the CPP disability benefits as set out under the legislation* are as follows:

a person shall be considered to be disabled only if he is determined to have a severe and prolonged mental or physical disability, where

(i) a disability is severe only if by reason thereof the person in respect of whom the determination is made is incapable regularly of pursuing any substantially gainful occupation, and

(ii) a disability is prolonged only if it is determined in prescribed manner that the disability is likely to be long continued and of indefinite duration or is likely to result in death

Most applicants to the CPP disability benefits meet the legislative requirement of having prolonged disabilities. The contention, however, mostly rests on the determination of whether the disability is severe enough to warrant the granting of benefits.

The Federal Court of Appeal ruled in the case Villani v. Canada (A.G.)^ the individual words of “regularly” and “substantially” must be given due emphasis when applying the legislative requirement.

For example, the word “regularly” means “at interval or times” and not “at all times,” while the word “substantial” encompasses “actually existing, not illusory, of real importance or value, practical” and not “completely.”

In addition to the considerations above, the Court commented as follows:#

What the statutory test for severity does require, however, is an air of reality in assessing whether an applicant is incapable regularly of pursuing any substantially gainful occupation.  Naturally, decision-makers already adopt a certain measure of practicality in their severity determinations.  As an obvious example, the scope of substantially gainful occupations suitable for a middle-aged applicant with an elementary school education and limited English or French language skills would not normally include work as an engineer or doctor.

In summary, the legislative test must not be applied in a vacuum. Rather, the particular circumstances of the applicant must be taken into account. If the applicant satisfies the decision maker that he or she cannot largely pursue gainful employment, he or she ought to be granted with the benefits.

* Canada Pension Plan, R.S>C. 1985, c. C-8, s. 42(2)

^ [2001] F.C.A. 248, [2002] 1 F.C. 130 (CanLII)

# Ibid., at para. 46

Note: Please keep in mind that this article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.

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Suing a Foreign Resident

Posted in: "All, Legalese Dictionary by Admin | No Comments Thursday, November 12, 2009

Traditionally in common law, the courts are territorial. That means that the court’s jurisdiction can only reach as far as the sovereign territorial limits. Because jurisdiction is territorial, a state’s law has no binding effect outside its jurisdiction. Consequently, the courts are reluctant to permit proceedings involving defendants residing outside the jurisdiction.

However, with the advancement of technology, international transactions now are seen as matters of routine. In a decision made by the Supreme Court of Canada, the Court held that so long as there’s a real and substantial connection to the legal forum, the court may exercise jurisdiction over the foreign defendant.*

In civil proceedings in Ontario, the court’s permission (“leave”) is still largely required for service of a defendant who resides outside Ontario. However, in many instances the required leave is no longer needed. Below is a partial list of circumstances where leave is not required when suing a foreign resident:^

  • in respect of real or personal property in Ontario
  • in respect of a tort committed in Ontario
  • in respect of damage sustained in Ontario arising from a tort, breach of contract, breach of fiduciary duty or breach of confidence, wherever committed
  • for an injunction ordering a party to do, or refrain from doing, anything in Ontario or affecting real or personal property in Ontario
  • against a person outside Ontario who is a necessary or proper party to a proceeding properly brought against another person served in Ontario
  • against a person ordinarily resident or carrying on business in Ontario

If the case doesn’t fall under one of the exemptions provided by the Rules, one may seek leave from the court to commence a proceeding against a foreign resident.

*Morguard Investment Ltd. v. De savoye, [1990] 3 S.C.R. 1077

^Rules of Civil Procedure, R.R.O. 1990, Reg. 194, R. 17

Note: Please keep in mind that this article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.

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A Brief Note on the Registered Disability Savings Plan (RDSP)

Posted in: "All, "Brief Note" Series, Administrative Law, Legalese Dictionary by Admin | No Comments Tuesday, November 10, 2009

What Is the RDSP?

The Registered Disability Savings Plan (RDSP) is the Canadian federal government’s initiative in assisting individuals with disabilities.^ To become eligible for the RDSP, you must be a Canadian resident under 60 years of age and eligible for the Disability Tax Credit.*

Once an RDSP account is open, anyone with written permission can contribute to the program. Unlike the Registered Retirement Savings Plan (RRSP), there’s no limit on the annual contribution. The annual deadline for contribution is December 31 each year.

There is, however, a lifetime limit of $200,000. Contributions to an RDSP are not tax deductible and can be made until the end of the year in which the beneficiary turns 59 years of age.

Perhaps the biggest incentives for opening an RDSP are the RDSP grants and bonds programs.#

The RDSP Grant

The Government of Canada will pay matching grants of 300, 200, or 100 percent, depending on the beneficiary’s family income and the amount contributed. An RDSP can receive a maximum of $3,500 in matching grants in one year, and up to $70,000 over the beneficiary’s lifetime. A grant can be paid into an RDSP on contributions made to the beneficiary’s RDSP by December 31 of the year the beneficiary turns 49 years old.

The RDSP bond

The government will pay income-tested bonds of up to $1,000 a year to low-income Canadians with disabilities, regardless of the amount contributed. The lifetime bond limit is $20,000. A bond can be paid into an RDSP until the year in which the beneficiary turns 49 years old.

However, there’s a catch – the grants and bonds must remain in the RDSP for 10 years. Otherwise they will have to be repaid back to the government.

read more…

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Legalese Dictionary: Trust Law 101

Posted in: "All, Business Development, Legalese Dictionary by Admin | No Comments Tuesday, November 10, 2009

What Is Trust Law?

In common law, a trust refers to an arrangement by which one person holds or deals with property for the benefit of another.

The person creating the trust is called the settlor, while the person enjoying the benefit is called the beneficiary. The person who administers the property under the trust is called the trustee.

A person may be a settlor, a trustee and a beneficiary of the same trust.*

The Three Certainties

Generally, a trust must have three certainties:

  • certainty of intention: The language of the alleged settlor must be imperative.
  • certainty of subject matter: The trust property must be certain.
  • certainty of objects: The beneficiaries must be certain or clearly identifiable.

Terminology

A bare trust (also known as a simple trust or a naked trust) refers to a trust where the trustee holds property without further duty to perform.

An inter vivo trust (also known as a living trust) is one made by deed, oral declaration, or in writing to take effect during the lifetime of the settlor.

A testamentary trust is one created under a will. Because a will can become effective only upon death, a testamentary trust is generally created at or following the date of the settlor’s death.

A spendthrift trust is one created to protect the beneficiaries from their inability to properly handle money. The funds often become payable after the beneficiaries come of age.

Statutory Trust and Deemed Trust

By the operation of law, certain funds advanced from one person to another for the specific purpose of paying a third can become impressed with a trust and may not otherwise be appropriated.

For example, under the Construction Lien Act,^ all funds received by an owner that are to be used in the financing of the improvement, constitute a trust fund for the benefit of the contractor. This is called the “owner’s trust.”

Similarly,  all funds owing to a contractor or received by a contractor or subcontractor on account of the contract price of an improvement constitute a trust fund for the benefit of the subcontractors and other persons who have supplied services or materials to the improvement. This is called the “contractor’s trust.”

*Note: This kind of “creative” trust, when used for ulterior purposes, e.g., avoiding creditors or tax authorities, is voidable.

^R.S.O. 1990, c. C30

Note: Please keep in mind that this article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.

PswLaw – Lawyer for your small business.

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A Brief Note on the Ontario Disability Support Program (ODSP) and the Henson Trust

Posted in: "All, "Brief Note" Series, Administrative Law, Legalese Dictionary by Admin | No Comments Monday, November 9, 2009

Most social assistance programs funded by the public purse have financial restrictions on eligibility. The Ontario Disability Support Program (ODSP) is no exception. To qualify for ODSP, the recipient must not have more than the prescribed assets. (For more information, read my blog “Too Much Money? ODSP’s Asset Restrictions,” posted on April 20, 2009.)

A Henson trust refers to a discretionary trust where the trustees have absolute discretion on the trust’s administration, while the beneficiaries under the trust cannot compel the trustee to pay out money. The name of the trust is derived from the Ontario Court of Appeal case Ontario v. Henson.*

In Henson, the settler of the trust mandated that the capital and income of the trust was not to vest in the beneficiary, and the only interest the beneficiary could have was the payments actually made. (In other words, there’s nothing legally the beneficiary can say or do to get more money than what’s actually paid by the trustees.) Therefore, the court ruled that the beneficiary did not have a beneficial interest in the trust.

Henson was considered a milestone in trust law in Ontario. It opened a door through which the asset restrictions of many state-funded welfare programs may be circumvented legally. The method of utilizing a discretionary trust to secure state benefits soon became widespread.

At the same time, creating a Henson trust means that the beneficiary is entirely at the trustees’ mercy. Hence, some lawyers caution their clients only to consider a Henson trust as the very last resort.

It’s important to remember not all discretionary trusts are Henson trusts. For example, 10 years after Henson in Ozad v. Ontario,^ the court held that whether a trust should be considered a Henson trust  would rest on the chosen wording.

A trust will become a “liquid asset” of its beneficiary if the words creating the fund oblige the trustee to consider the needs of the beneficiary, unless there is a provision in the document removing the fund in whole or in part from the reach of the beneficiary.

For example, in Keddy v. Director, Ontario Disability Support Program,# the court has made it clear that an unsheltered trust will be included as assets. Accordingly, of the accumulated assets exceed the prescribed level, the applicant will be disqualified from the ODSP.

*[1989] 36 E.T.R. 192; aff’g [1988] O.J. No. 1121

^[1998] O.J. No. 6498

#[2002] CanLII 17592

Note: Please keep in mind that this article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.

Let PSWLaw fight for your ODSP appeal before the Social Benefits Tribunal.

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Ontario Bans Hand-Held Devices While Driving

Posted in: "All, Administrative Law, Legalese Dictionary by Admin | No Comments Monday, October 26, 2009

The new Countering Distracted Driving and Promoting Green Transportation Act came into force today. The Act amends various parts of the Highway Traffic Act^ and the Public Vehicles Act.# The supplementary regulation reflecting the amendment of the Highway Traffic Act also came into force today.

The legislative explanatory note provides a summary to the amendment of the Highway Traffic Act:

Driving a motor vehicle with the display screen of a television, computer or other device visible to the driver is prohibited. The display screens of global positioning system navigation devices, hand-held communication and similar prescribed devices, commercially-used logistical transportation tracking systems, collision avoidance systems and instruments, gauges and systems providing information regarding the status of systems of the motor vehicle are exempted from the prohibition. Drivers of ambulances, fire department vehicles and police department vehicles are also exempted. The Minister of Transportation may provide for further exemptions by regulation.

Driving while holding or using a hand-held wireless communication device or electronic entertainment device is prohibited. Use of such devices in the hands-free mode is exempted. Use of such devices while the motor vehicle is off the travelled part of the road, not in motion and not impeding traffic is exempted. Drivers of ambulances, fire department vehicles and police department vehicles are exempted from the prohibitions respecting hand-held wireless communication devices, as are any drivers using the devices to contact ambulance, police or fire department emergency services. The Minister of Transportation may prohibit holding or using other devices by regulation and may provide for further exemptions by regulation.

Keep in mind that many public servants, such as the police and firefighters are exempted from this regulation. Therefore, don’t scream “hypocrisy” when you see police officers using their two-way radios or laptops. For the rest of us, we’re allowed to do the following:

  • talking on the phone using a hands-free device
  • pressing a button to accept or decline answering a call if the device is placed securely in or mounted to the motor vehicle so that it does not move while the vehicle is in motion and the driver can see it at a quick glance and easily reach it without adjusting his or her driving position.
  • using a GPS device
  • using a collision avoidance system device that has no other function

However, the following tasks are not OK under the new law:

  • watching a DVD while driving
  • texting while driving
  • dialling numbers by hand while driving
  • using a laptop while driving

Of course, the examples are not exhaustive. If you’re unsure about what you can or cannot do while driving, please consult a properly licensed lawyer.

*S.O. 2009 c.4

^R.S.O. 1990, c. H.8

#R.S.O. 1990, c. P.54

** O. Reg. 366/09

Note: Please keep in mind that this article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.

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UK’s Brand New Supreme Court

Posted in: "All, Legalese Dictionary by Admin | No Comments Tuesday, October 6, 2009

For Canadians, the Supreme Court is known to the public as an established, well-respected institution serving as the final appellate court. Surprisingly, this hasn’t been so for the Brits until October 1 of this year.

For the previous four hundred plus years, the highest court of the United Kingdom had been the House of Lords, which is also the upper house of Parliament. Under the modern philosophy of separation of powers, it has long been an oddity, that a legislative body also serves as the judiciary at the highest level.

In a press release by the Court, the President of the Supreme Court said: “For the first time, we have a clear separation of powers between the legislature, the judiciary and the executive in the United Kingdom. … It emphasises the independence of the judiciary, clearly separating those who make the law and administer it.”

Unlike Canada’s Supreme Court, the UK’s cannot strike down statutes as unconstitutional because there is no written constitution in the UK and Parliament itself is supreme. The UK Supreme Court, however, can (and will) send back to Parliament laws that are inconsistent with the European Convention on Human Rights, incorporated into British Law in 1998.

To learn more about the UK Supreme Court, visit its website at www.supremecourt.gov.uk/index.html

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A Brief Note on Simple Divorce and Uncontested Divorce

Posted in: "All, "Brief Note" Series, Family Law, Legalese Dictionary by Admin | No Comments Monday, October 5, 2009

Many people think a “simple divorce” and an “uncontested divorce” are the same thing.

In Canada they are not.

A simple divorce refers to spouses asking the court to dissolve the marriage and not to adjudge any other issues, such as custody and access to the children, child support, spousal support, and property division. A simple divorced may be petitioned and granted in writing without the personal attendance of the spouses.

An uncontested divorce refers to one spouse petitioning for a divorce and corollary relief unopposed by the other. This often happens when the other spouse decides not to participate in the proceeding.

A divorce can be simple and uncontested at the same time. For example, if the parties have settled their affairs at separation by a separation agreement, the divorce proceeding is likely to be simple and uncontested.

Alternatively, in extremely short marriages where there are no children involved, (e.g. two near-strangers with killer hangovers wake up surprised to find that they got married the night before) the parties may wish to part their ways by a simple and uncontested divorce.

However, what started out as a simple divorce may become a full-blown proceeding before the Court. For example, one spouse’s application for a simple divorce may be contested by the other because the latter wishes to ask for spousal support.

Similarly, an application for divorce and corollary relief (e.g. spousal support, child support, etc.) can be uncontested if the other spouse simply doesn’t participate in the proceeding.

There you have it.

PSWLaw is your relentless advocate in family law.

Please Note: This article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.

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The Curse of the Unbillables

Posted in: "All, Administrative Law, Business Development, Family Law, Legalese Dictionary by Admin | No Comments Sunday, October 4, 2009

The revenues of a law firm comes from what we call “billables.” This term refers to the input of lawyers (or staff) on a matter which clients pay for. Alas, not all input is billable – services rendered but not charged to clients are thus called “unbillables.”

The unbillables can be divided in three categories: overhead, administrative and compliance, and professional competency and development.

1. Overhead

This refers to costs of operation that can’t be attributed to individual cases. Typically, overhead would include the following:

  • rent
  • telephone
  • internet
  • utilities
  • equipment
  • furniture
  • subscriptions
  • bank charges
  • credit card processing fees
  • insurance
  • professional association membership dues
  • supplies

2. Administrative tasks and statutory compliance

This refers to administrative tasks and compliance duties required to keep a law firm running smoothly. For example, the following items generally fall under this category:

  • bookkeeping tasks
  • opening and closing files
  • billing and collection
  • internal filing
  • law firm meetings or staff meetingsor partner meetings
  • staff training
  • statutory reports to the Law Society or the governing body
  • file and data storage
  • mandatory professional liability insurance
  • Law Society (or the governing body) dues

3. Professional competency and development

As lawyers, we are expected to be reasonably familiar with the law and its latest development. For example, a family law lawyer is expected to be familiar with the law on divorce, child support, spousal support, custody and access, and property division. If a lawyer needs to review the basic legislation prior to answering an inquiry, time spent on reviewing is likely unbillable. Likewise, time spent on learning new developments in the law is generally not billable.

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Landlord’s Right of Distress

Posted in: "All, Administrative Law, Business Development, Legalese Dictionary by Admin | No Comments Tuesday, September 29, 2009

The right of distress, also known as “distraint,” (verb: to distrain) is a common law doctrine where the creditor is entitled to seize the debtor’s properties to satisfy the debt owed. In the context of commercial tenancies, it refers to the landlord’s right to seize chattels (goods) on the premises owned by the tenant if the tenant defaults on the lease. Depending on the jurisdiction, the right to distress may be carried out with or without a court order.

In Ontario, a commercial landlord’s right of distress is governed by the Commercial Tenancies Act.* Under this act, the sometimes harsh common law doctrine has been somewhat softened. Various provisions of exemption and modification shelter commercial  tenants from losing-it-all. For example, in the absence of fraud, goods and chattels not on the premises when distress is carried out will not be subject to seizure.^ This means that the landlord can’t break into a tenant’s home and start carting out the tenant’s personal belongings to satisfy the rent in arrears.

It’s important to note that in the case of residential tenancies, a landlord’s right to distress has been abolished.** A landlord seeking to recover residential rent owed or to evict a tenant from his or her home for non-payment of rent has to apply before the Landlord and Tenant Board for an order before the recovery and/or eviction can take place.

*R.S.O. 1990, c. L.7

^ss. 47-50

** Residential Tenancies Act, S.O. 2006, c. 17, s. 40

Please Note: This article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. Legislation referred to may have been amended or repealed since the publication of the article.

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