The attached presentation was presented by lawyer and partner Joseph Cuenca and articled student Larissa Sleva to the Richmond Chamber of Commerce lunch and learn webinar.
The attached presentation was presented by lawyer and partner Joseph Cuenca and articled student Larissa Sleva to the Richmond Chamber of Commerce lunch and learn webinar.
The most challenging aspect of litigation, from a client’s perspective, is the cost. These days, the cost of litigation is prohibitive and minimizing the cost of the case is part of our professional duty. Lawyers have a mandate not to push for litigation. Instead, we inform the client of other settlement options. There are many ways that a case can be settled, such as mediation, negotiated settlement, and arbitration. In family law, there are four-way meetings and collaborative divorce. These avenues can be more cost-effective.
The other challenging aspect of litigation is the emotional toll it can take on a client. When we deal with clients, we have to consider how much of the emotional stress they can handle and how far they’re willing to take a case. Some clients make it clear early on that they don’t want a long process and want it dealt with as quickly as possible. These cases are taken on during a stressful time in their lives. Being involved in a legal dispute occupies a large part of their mind, they can become costly, and require much of their time. Not to mention their ongoing responsibilities outside of the case. All of these are important aspects we have to keep in mind when working on a case..
In my experience, litigators have to have on-going discussions with the client about the costs, both emotional and financial. These are matters I raise with my clients as the case progresses. It’s important to make sure they’re comfortable with the direction the case is heading and are capable of proceeding.
Educating the client on their options is crucial. Once we explain to them their potential options and the costs involved, both financial and emotional, they can then make an informed decision. Additionally, taking the time to properly walk the client through their options builds trust. It shows that we truly want what’s best for them.
This article looks at divorce mediation in British Columbia, including some of its advantages and drawbacks.
Divorce mediation has a long history in British Columbia, having been first recognized and regulated by the Law Society of British Columbia in 1984. However, as the Vancouver Sun reports, it has only been in the past decade or so, and in conjunction with governmental support, that mediation has grown to become a viable and popular alternative to resolving many divorces in the province. The advantages of mediation are fairly numerous, including often being cheaper and less adversarial when compared to litigation. Mediation, however, is not a panacea that will resolve all divorces equally well and it is important for couples considering mediation to know whether the process is likely to work for their needs.
As the British Columbia Ministry of Justice points out, mediation can take a variety of forms. A mediator, for example, may be a Family Justice Counsellor, a lawyer, judge, social worker, or other professional who is qualified to carry out family dispute mediations. Likewise, while some mediations proceed with both spouses sitting at the same table along with a mediator and resolving their issues face to face, in other situations the spouses may be kept separate from one another and negotiate their settlement through a neutral mediator. What is most important to understand about mediation is that it is an alternative to litigation, meaning that outstanding issues that arise during the divorce are resolved out-of-court and by the spouses themselves (with the assistance of the mediator).
Every divorce is unique and couples choose mediation for a variety of personal reasons. Money can be a big motivating factor, since mediation typically costs just a fraction of what litigation would cost. However, couples should not choose mediation based on finances alone; rather, they have to be well-suited to a mediated settlement in order for the process to work. Couples who are still able to negotiate in a mature and respectful manner with one another and who can keep their own emotions from overwhelming their decisions are most likely to benefit from mediation. Furthermore, mediation tends to be less adversarial than litigation, which can make the process less upsetting not just for the divorcing spouses, but also for any children they may have.
While it would be great if all divorces could be resolved amicably and without the intervention of a judge, the fact is that in some cases litigation is a necessity. Mediation often fails when there is a power imbalance in a couple’s relationship or when trust has broken down during the negotiations (such as if one spouse attempts to hide assets from the other). In highly complex divorces, as well, couples may need or may prefer to rely on the court to resolve the numerous issues that can arise when dividing a large marital estate.
Deciding whether or not mediation may be the right process for a particular couple requires careful planning and consideration. A family lawyer, who has experience in divorce mediation, can inform couples about what mediation entails and whether it may be suitable to their particular circumstances.
In a case that should serve as a warning to other parents involved in highly contentious child custody battles, the B.C. Court of Appeal ruled that a woman who moved with her child to Italy is not owed back child support from the child’s father, according to the Nanaimo Daily News. The court found that by taking the child to Italy, the mother had violated previous court orders and had not placed the interests of the child first.
The case stems from an earlier British Columbia Supreme Court decision that ruled that if the mother wanted to apply for any back child support owed to her she would have to return to Canada and apply in person, according to the Toronto Star.
The couple in this case had a child soon after they were married, but then decided to seek a divorce soon afterwards. According to custody orders, the mother was initially given custody of the child, but the father was granted unsupervised visits on specific dates. However, prior to one of those visits the mother moved to Italy with her child without the father’s consent.
In response to the mother’s move, the father sought to have his child support obligations cancelled by a court. The mother fought against the father’s move to cancel the child support payments, but now the Court of Appeal has ruled against her in a two to one decision.
The father owed $32,000 in back support, but the judges ruled that the mother’s conduct prevented the father from actually providing support to the child. Furthermore, the court determined that ruling in the mother’s favour would effectively endorse her violation of court orders. The court ruled that if she wants to seek child support now she will have to do so in Italy. The one dissenting judge, however, said there was insufficient evidence for the court to rule against the mother and advised that the case should be sent to the Supreme Court of Canada. The mother’s lawyer has yet to comment on the ruling.
This case highlights just how contentious child support and custody issues can be following a divorce. Furthermore, this ruling goes to show just how serious the consequences can be if either parent violates a custody order issued by a court. Any parent who is looking to establish a child support or custody plan should consult with a qualified family law lawyer. Such a lawyer can help parents come up with a custody and support plan that works for them and makes sure their children are adequately provided for.
Focusing on age and tax implications, the article looks at how retirement accounts can be split during divorce.
Deciding how to split assets is one of the most important – and often among the most complicated – aspects of many divorces. For people who are divorcing later in life, dividing marital property will be an especially central concern if they are to enjoy a comfortable retirement. In such divorces, as the Financial Post points out, it is necessary for both parties to consider their entire financial portfolio and how it lines up with their retirement goals. Splitting RRSPs and pensions, for example, will be a major topic for many divorcing couples, but how such assets are split will depend on the unique circumstances of each divorce.
For people who are planning on retiring within a few years after their divorce, it is important to keep in mind how those remaining years of work will impact the assets they receive in their divorce settlement. If, for example, an RRSP is split 50-50, that could leave one or both former spouses with only half of a significant retirement asset that they were otherwise relying on for their future plans – and with little time left to replenish it. The same, of course, holds true of pensions and other investments that a person may be counting on for his or her retirement.
As the Globe and Mail points out, people going through a divorce need to decide whether they simply want to split all of their assets 50-50 or if they want to negotiate who gets which assets in order to come to a roughly fair settlement. While the former choice may seem the simplest, the latter option may prove more beneficial in some cases. For example, splitting all assets down the middle would require that the family home be sold off and the value be divided between both parties. A popular alternative is for one spouse to keep the house in exchange for the other spouse keeping the RRSPs and pensions. Such an option needs to be carefully considered, however, since in many situations the cost of maintaining a home can make what otherwise looks like a fair settlement overly lopsided in the long term.
Among the most important concerns when deciding on who gets an RRSP are taxes. Dividing or transferring an RRSP account will not result in a tax penalty, which can prove highly beneficial to the party that ultimately ends up with the bulk of the couple’s RRSPs. However, it is just as important to keep in mind that money that is withdrawn from an RRSP is taxable. While it is important to plan for the future, making sure that a settlement leaves one with some immediate cash on hand can be just as important.
Understanding how property gets divided during a divorce and what a fair settlement actually looks like is difficult for most people. Having skilled legal advice on hand is often a key factor in ensuring one’s best interests are protected during a divorce. An experienced family lawyer can help those who are preparing for or in the middle of a divorce make sense of what is often an otherwise confusing and overwhelming situation.
Dear Clients and fellow legal professionals,
Given the measures being implemented by the government to address the rapid spread of the COVID-19 within Metro Vancouver, we are implementing the following measures in our office beginning March 18, 2020:
As part of our efforts to comply with public health orders and recommendations for social distancing, we are currently implementing a protocol to ask clients, before they come to the office, to advise if:
(a) they or a member of their household have a fever, cough or difficulty breathing, OR
(b) they or a member of their household have travelled outside, or been in contact with, someone who has travelled outside of Canada and returned on or after March 12, 2020.
If the answer to either question is YES, we would prefer to delay meeting until the health issue has passed or the British Columbia Public Health Order mandatory 14-day self isolation period has passed since the travel or contact; unless, of course, we need to act urgently.
Rest assured, we remain on top of your cases or concerns, and are constantly monitoring press releases and issuances by various government agencies to understand how they impact legal services, government filings, business transactions, court proceedings, and other legal matters.
We thank you for your kind consideration and we will update you as the situation warrants.
Cohen Buchan Edwards LLP Partners
Further to our article on the same topic posted on December 6, 2017, effective February 21, 2018 the additional property transfer tax rate is increased to 20 percent from 15 percent. In addition, the tax is expanded to the following areas:
For these newly added areas, there are transitional rules that may exempt certain transactions entered into before February 21, 2018. For instance, if the change of title occurs on or before May 18, 2018 and the property transfer is subject to a written agreement dated on or before February 20, 2018, this tax is not payable. However, if the written agreement is assigned to a foreign entity on or after February 21, 2018, the tax is payable.
There are no transitional rules for transactions for the Greater Vancouver Regional District.
Same as before, the tax only applies to residential properties and residential portion of properties, such as residential portion of farm land (eg. farmer’s home).
Also effective February 21, 2018, the rate for the regular Property Transfer Tax which applies to all real estate transactions (except exempted transactions) has increased for residential properties above $3 million. The tax is now as follows:
Eg. if the property is classified entirely as residential and has a fair market value of $4,500,000, the tax is $143,000, calculated as follows:
For more information, please visit gov.bc.ca/propertytransfertax. For enquiries on this topic, please contact one of the lawyers in our Real Estate Group.
Being the director of a corporation sounds like a cushy job, but not so fast. A director has a stringent set of rules to abide by.
The BC Business Corporations Act sets out all the duties that a director has. Particularly, a director must act honestly and in good faith with a view to the best interests of the corporation and exercise the care, diligence, and skill that a reasonably prudent individual would exercise in comparable circumstances.
Honesty
Directors must respect the trust and confidence they have been given in managing the assets of the corporation. Further, they must be truthful and open and are prohibited from realizing any secret profits or non-approved conflict of interest.
Good Faith and In the Best Interests of the Corporation
The duty of good faith can be generally referred to as the duty of loyalty or fiduciary duty. Whether a director has exercised this duty of good faith is determined on a case by case basis.
Diligence
The duty of diligence puts the onus on a director to make those inquiries that a person of ordinary care in that position or in managing his or her own affairs would make. Some examples of situations where these duties of directors come into play are as follows:
Skill
Directors must respect the trust and confidence they have been given in managing the assets of the corporation and must exercise the care, diligence, and skill that a reasonably prudent individual would exercise in comparable circumstances. Further, they must avoid using their position for their personal benefit and must avoid any conflicts of interest with the corporation. Finally, directors must maintain the confidentiality of any information they obtain by virtue of their position and they must serve the corporation selflessly, honestly and loyally.
Duties Are Owed to Corporation
The long standing principle has been that directors owe a fiduciary duty only to the Corporation and not anyone else. However, recent case law has carved out exceptions where directors may be held liable to other groups such as shareholders, creditors, employees, the government and the public, among other groups.
Conflicts of Interest
As mentioned previously, directors are to avoid conflicts of interest wherever possible. However, courts consider what a reasonable person, in considering a particular situation, would think gives rise to a real sensible possibility of conflict, not what one could imagine could arise out of a situation. Essentially, the courts are not willing to look at every possible situation which could arise out of a situation as a potential conflict.
Further, directors have an obligation to disclose to shareholders any profits or gains realized from a contract or transaction with the corporation if it is material to the corporation. The Business Corporations Act has codified this requirement, by setting out a general test which requires assessing whether
If answers to both parts of the test, are a “yes” then a director should disclose the interest to the shareholders of the corporation.
From a practical perspective, an assessment of whether a director is in a conflict of interest, whether they have addressed the conflict of interest, and whether they have made sufficient disclosure to interested parties is a fact based exercise. Directors would be prudent to remain as transparent as possible when dealing with any potential conflicts of interest.
For inquiries on this topic, please contact one of the lawyers from our Business Law Group at 604.273.6411.
An Enduring Power of Attorney is a document prepared in accordance with the Power of Attorney Act, that a capable adult (the “Adult”) (at least 19 years old) uses to appoint another person, called an Attorney, to make financial and legal decisions for them. Essentially, an Enduring Power of Attorney remains in effect (or endures) if the adult becomes incapable of managing his or her affairs (Power of Attorney Act s. 30). Those considering creating Enduring Power of Attorneys should be particularly cognizant of the age requirement for an Attorney being able to act for a capable Adult. Specifically, if an Enduring Power of Attorney names as Attorney an individual who is not an adult (at least 19 years of age), that individual may not act until becoming an adult (Power of Attorney Act s. 18).
In order to distinguish an Enduring Power of Attorney from a general Power of Attorney, s. 14 of the Power of Attorney Act states that an Adult who makes an Enduring Power of Attorney must state the following in the Enduring Power of Attorney:
The key distinction between a general Power of Attorney and an Enduring Power of Attorney is that an Enduring Power of Attorney, unlike a general Power of Attorney does not cease to be in effect if the Adult becomes incapable of managing his or her affairs. However, there are enumerated grounds through which the authority of an Attorney under an Enduring Power of Attorney is suspended or ends. S. 29 of the Power of Attorney Act provides that the authority of an Attorney under an Enduring Power of Attorney is suspended or ends:
The Land Title and Survey Authority of British Columbia (the “Land Title Office”) often deals with Enduring Power of Attorneys, when an Attorney wishes to deal with the real property of the authorizing Adult. However, the Land Title Office often finds issues with Enduring Power of Attorney documents and accompanying applications which cause them to reject registrations of Enduring Power of Attorneys to deal with the real property of the authorizing Adult. In essence, if the Enduring Power of Attorney does not meet the requirements of the Land Title Office, it will be ineffective for purposes related to real property. For example, defective Enduring Power of Attorneys cannot be used to sell, purchase, mortgage or otherwise deal with real property.
Some of the common mistakes the Land Title Office sees in Enduring Power of Attorneys are as follows*:
These mistakes will result in the Enduring Power of Attorney being rejected for registration at the Land Title Office, and thus useless for land purposes.
For inquiries on this topic, please contact one of the lawyers from our Real Estate Group at 604.273.6411.
*ltsa.ca/practice-information/common-errors-leading-defects
Accidents are never pleasant, but having a car accident outside of British Columbia can add a layer of complexity. Your ICBC policy is valid in other provinces and in the United States. However, your policy may provide a limited scope of that coverage. This is especially the case if you need to pursue an “at fault” driver when the accident happens away from home. It’s helpful to understanding ICBC’s role when the accident occurs outside of your home province.
ACCIDENTS IN BC
When an accident occurs in BC, ICBC is on one hand your insurer, which is contractually bound to offer coverage for certain treatment expenses and related income loss, as part of your policy. In this role, ICBC is also required to pay for damages that may be assessed against you, arising from mistakes that you make on the road.
At the same time, ICBC is also the insurer for the other party in the accident, and in that role ultimately responsible for paying damages to you in a “tort” claim, if the other party is found liable for damages that you suffer. Compensation is paid in to you by ICBC in its capacity as the other party’s insurer.
The distinction is often muddled, as the same ICBC adjuster will often concurrently deal with you on benefits under your policy (commonly termed “no fault” or “Part VII” benefits), as well as discuss compensation being offered to you, in ICBC’s other role as the other side’s insurer.
ACCIDENTS OUT-OF-PROVINCE
When an accident occurs in another province or abroad, ICBC’s role is confined to that of your insurer only. If you are involved in an accident while traveling, your claim would be governed by the laws of that jurisdiction.
An accident in Bellingham for example, will usually be bound by the laws of Washington state, and the defence of any action brought would be handled by the US insurer for the American driver. Any Court proceedings will also likely take place in Washington state. A myriad of issues can arise given the differences in laws and limitation periods dealing with claims in a foreign jurisdiction, and you should move quickly to ensure that someone is there to assist you in navigating through the complexities of a claim being brought out-of-province.
Further, laws in many US states often mandate a much lower minimum “third party coverage” threshold (the amount of coverage available to the other side’s insurer to satisfy your claim), which means that additional steps must be taken early on, to ensure your rights are fully protected.
Specific thought also must be given to the Underinsured Motorist Protection (“UMP”) provisions of your ICBC Basic Autoplan policy, which offers you protection in the event that that at-fault driver does not have sufficient coverage. While this is a contractual benefit, specific steps must be taken to secure the protection of this coverage in the event that there is a shortfall. A lawyer should be able to assist in making the determination whether you will likely need to turn to UMP. For added protection, ICBC also offers optional “Extension UMP” coverage, which can be purchased to offer further protection.
In cases which the accidents occurred elsewhere but involving only BC drivers (who would all be insured by ICBC), the parties can agree to have the matter dealt with in BC. In those instances, the parties can agree to attorn or agree to the jurisdiction of the BC courts so as to simplify the process, though foreign laws may still apply.
Bottom line: before you drive outside of BC, it’s a good idea to contact your insurance broker to obtain the right coverage. If you do get in an accident while away from home, consider hiring a lawyer to help you navigate the aftermath.
If you have any questions regarding ICBC related matters, please contact Monica Dosanjh at monicadosanjh@cbelaw.com or 604.273.6411.