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.
Are you looking for a firm that appreciates a work life balance?
Cohen Buchan Edwards LLP is accepting applications from experienced litigation lawyers of 3 plus years. First hand experience with Family Law and civil litigation an asset.
CBE is located in Richmond, BC. established 40 years ago with many returning clients. CBE has an excellent support system of staff using modern software and technology to support our lawyers. Voted #1 law firm in Richmond, by the Richmond News readers.
What is CBE looking for:
What will CBE provide:
If you feel you can bring value to Cohen Buchan Edwards LLP and would like to be a part of this team, please send your resume along with a cover letter telling us why you would like to join CBE to hr@cbelaw.com .
Please note we will be unable to reply to all applicants. Only candidates on the short list will be contacted.
An executor takes care of your estate when you die, but who takes care of things if you are unable to make decisions for yourself while alive?
Signing a power of attorney gives someone you trust implicitly — like your spouse, sibling or child — signing authority over your financial and legal affairs. The person appointed, known as your attorney, can conduct banking on your behalf, buy and sell property, and even renew your mortgage.
It isn’t fun to think of situations where you might need someone to take control over your financial affairs — but it can help tremendously in a number of situations, from a debilitating accident, to a brain injury, to a diagnosis of dementia.
The most common form used by individuals is an enduring power of attorney, effective upon signing, which can be used whether or not you are incapacitated. Some people prefer to grant a springing power of attorney, which can only be used once you become incapable, although this requires proof of your incapacity, which may delay use of the power of attorney.
Both types of enduring power of attorney will allow your trusted appointee to protect your financial and legal interests when you can’t protect yourself. The alternative to an enduring power of attorney, getting a court-appointed guardian, can be both time consuming and expensive.
Granting someone power of attorney does not have to be a permanent decision. You can choose to revoke or change your power of attorney at any time.
Much like writing a will and appointing an executor, a power of attorney will ensure your interests are represented. Choosing your power of attorney is an important planning decision and requires careful thought and consideration. Talk to Cohen Buchan Edwards today and see how we can help you plan for the unexpected and protect your interests and assets.
When setting up a business, there are a variety of business structures that are available. So which is best for your needs? Below is a general overview of three basic business structures.
Sole-Proprietorship
In a Sole-Proprietorship a business has a single owner who is solely responsible for all the liabilities a company owes to third-parties (eg. financial institutions). This business structure is the simplest way of organizing your business as it only requires a business owner to
From a legal and tax standpoint, there is no distinction between the business and the individual who owns the business. As a result, there is single ownership of the assets and liabilities of the business and there are low administrative costs and few formalities associated with operating the business. The lower level of complexity of a sole-proprietorship allows business owners to use simple accounting software to track their revenue and expenses. Further, if a business owner chooses to retain an accountant for their accounting requirements, then there are likely to be lower fees associated with the work. The legal structure of a sole-proprietorship is such that no public reporting is necessary, and the sole proprietor only needs basic financial knowledge to run the company and satisfy banks, vendors, CRA etc.
From a tax standpoint, the sole proprietorship’s earnings before tax (EBT) form the taxable income of the sole proprietor. The sole proprietor’s income is taxed at the personal tax rates of the individual, hence this type of business structure is limited when it comes to deducting expenses and sheltering its income.
Finally, as mentioned, the liabilities of the sole proprietorship are also considered to be the liabilities of the individual owning the business. As a result, the business owner is fully responsible for all of the company’s dealings. This can lead to a situation where, if the business were to be sued, then the business and personal assets of the sole proprietor can be seized to settle claims.
Corporation
A Corporation is a separate legal entity that can own assets, incur debt, sue, be sued, enter into contracts, and hold property in its own name. A Corporation is formed when one or more individuals incorporate a business. It can be incorporated provincially or federally.
A Corporation is considered to have potential “immortality” in that it is an impersonal entity that can in theory exist forever. This means that despite certain changes in the Corporation’s composition (eg. An owner dying, shareholders changing etc.), the Corporation would not dissolve.
A defining feature of a Corporation is the limited liability associated with it. Under all Canadian statutes providing for the incorporation of companies, the members who form the corporation and become its shareholders are only required to contribute towards the debts of the Corporation the amount that they have agreed to pay for their shares in the Corporation. Limited liability is a substantial advantage in that if the Corporation is sued, the owners’ personal assets cannot be seized to settle the claims. Further, the ownership percentage of the owners of a Corporation is dependent on how many shares the shareholders hold.
A strong advantage for Corporations within our current taxation scheme is that they have few limits on the expenses they can deduct for taxation purposes. Corporations pay tax on earnings before tax at established rates. Net income that is distributed to owners is then taxed again at their personal rates. Further, some Corporations receive preferential income tax treatment and Corporations often provide more flexibility in deferring taxes and in allowing the division of business income.
However, incorporating and maintaining a corporation can be a relatively costly endeavour. For example, a corporation is required to file its own income taxes as well as abide by its annual filing requirements. The initial cost of incorporation and organization required to maintain related documents can also be a hurdle to consider. Further, in the multiple owner structure of a Corporation the shared decision making can increase accountability, but can also lead to slower decision making.
General Partnership
A General Partnership is a business established by two or more owners. General Partnerships are fairly simple and inexpensive to form as there are few formal legal requirements. All the General Partnership needs is a:
Typically the owners (the “Partners”) work out a partnership agreement that outlines their respective powers, ownership share and capital contribution, profit distribution, and operating procedures for the business. By default, all Partners are able to share in the management of the company, in the absence of a partnership agreement that states otherwise.
A General Partnership includes joint ownership with some formalities and moderate administration expenses. The Partners of the Company essentially pool their funds to raise capital. A disadvantage of a General Partnership is that decision making can become cumbersome, as important decisions require voting among partners. However, the partnership agreement may provide that smaller, less important decisions may be made individually as long as the other Partners are informed.
Revenues, expenses and cash flow management are typically tracked internally with additional support from outside accountants. There are no public reporting requirements for General Partnerships, but general financial information would be required to run the company and satisfy banks, vendors, CRA etc.
From a taxation perspective, each Partner is taxed individually on his or her share of the partnership income. Hence, there is no need for a tax return from the General Partnership itself. In terms of disadvantages, there are greater limits to what expenses can be deducted and the taxable income of the individual Partners is subject to their personal tax rates.
Legally, each Partner is liable for all assets and liabilities of the General Partnership. As a result, if the company is sued, then each Partner’s personal assets can be seized to settle the claims.
* Much of this general information can be found on the Business Development Bank of Canada website
If you have questions about how to best structure your business, contact Cohen Buchan Edwards LLP at 604.273.6411 to speak to one of our lawyers.
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.
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.
As of March 18, 2013, the Family Relations Act (“FRA”) was replaced with the Family Law Act (“FLA”). Sweeping changes came into effect under the new legislation affecting all aspects of family law. Amongst the many changes is the process by which parents can now move away and change the primary residence of the child.
The FRA did not specifically address child relocation and the case law in this area was often unclear.
The introduction of the FLA containing provisions dealing specifically with child relocation is intended to provide some clarity and certainty in this area. It offers this step-by-step process to resolve child relocation issues:
This more organized and systemized approach is intended to reduce the amount of cases that go to litigation on parent mobility and child relocation issues. The process is set out in the legislation for parents to follow. Parents who do not object to the relocating parent moving away with the child can simply acquiesce to the proposed relocation by not doing anything after receiving the written notice. Parents who do not object to the relocation but require certain measures to be in place to ensure that his/her relationship is preserved with the child will have an opportunity to resolve such matters with the other parent outside of court as the parents are required to use best efforts to resolve such disputes. It is only if such efforts cannot resolve the matters in dispute that either parent may bring an application to court.
Whether this new scheme will actually reduce the amount of cases that go to litigation on parent mobility issues is yet to be seen. It nonetheless can be said that these changes are significant improvements to our legal system in dealing with the new challenges that arise from the surge of globalization and the increasing demand for freedom of mobility.
For more information regarding Family Law, please contact one of our Family Lawyers or complete this form and one would be happy to contact you.