Chapter 2 The Judicial System and Alternative Dispute

Resolution
Introduction

Courts responsibilities
o Settle disputes
o Guardians of the rights and freedoms
Determines if the legislations passed infringe on the rights and
freedoms
Interprets the constitution
The Supreme Court of Canada has the ultimate say in how the
Charter is interpreted
Courts in business
o Usually called upon to interpret contracts between individuals and
business firms in order to determine the rights and duties of each party

Development of the Law Courts

Canadian system of courts changed gradually compared to American courts

Has influence from both France and England

Early Law Reform

Changes in English courts started to emerge in Canadian courts

Prairie provinces were influenced by both English courts and other Canadian
provinces
o Ontario reorganized the Supreme Court into two parts
A High Court of Justice as a trial court
Court of Appeal to hear appeals
Canadian courts have evolved towards a...
o Streamlining judicial process
o Reduction in formal procedure
Provincial judicial system
o Small Claims or Small Debts Court
o Provincial or Magistrate Court
Hears minor criminal matters and cases concerning violations of
non-criminal provincial statues
o A Superior or Supreme Court
Criminal cases are usually heard by the Supreme Court
o A Court of Appeal
In provinces with no Court of Appeal, they go to Supreme Court
Before the Charter, courts determined the validity of provincial and federal
statutes under Sec 91 and 92
o With the new constitution, the court has the responsibility to determine
if statutes also offend the Charter

The Structure of the Judicial System

Many different courts in the judicial system

o Must have authority over the type of case (e.g. money, land... etc)
o Must have authority over at least one of the parties to compel the
parties attendance or to impose its decision on them
Two general classifications of the courts of law
o Courts of original jurisdiction
Courts where a dispute or case is heard for the first time by a
judge
Where all the facts are presented so that the judge can render a
decision
Aka Trial Court the court in which a legal action is first
brought before a judge for a decision
o Courts of appeal
Are considered superior or higher courts because their
decisions may overrule or vary the decisions of the lower
(trial) courts
Main function is the review that decisions of trial courts if one of
the parties believes the trial judge made an erroneous decision
Does not hear evidence; it hears objection to the
decision/reward/severity of penalty at the trial court
An appeal court may find that the judge at trial failed to
consider important evidence in reaching the decision send
back to the lower court for a new trial

Federal Courts

Federal Court Trial Division hears...

o Disputes between provincial governments and the federal government
o Actions against the federal government
o Admiralty, patent, trademark, copyright, and taxation matters
o Appeals from federal boards, tribunals and commissions
Some jurisdictions are exclusively federal courts
In some jurisdictions, the federal court is on equal level as the superior
provincial courts
o May chose to take the case up to the Federal Court Trial Division or the
appropriate provincial court
o An appeal in the Federal Court may be appealed to the Federal Court of
Appeal
Tax Court is part of the federal court system that hears disputes between
taxpayers and the Canada Customs and Revenue Agency
o Only limited to tax assessments
o Appeals go to the Federal Court of Appeal
Supreme Court

o
o

Hears important appeals from the appeal courts of the various

provinces
Hears appeals from the Federal Court of Appeal

Provincial Courts

Each province has the authority to establish its own system and to assign to
each court a specific jurisdiction
o No province has the same system, but they are similar

Criminal Courts
Magistrates or Provincial Court

A court of original jurisdiction that is presided over by a provincially

appointed magistrate or judge
Hears criminal matters relating to accused individuals or corporations
Some provinces gave these courts the power to hear cases involving the
violation of provincial statues and municipal by-laws where some sort of
penalty is imposed
Is the first to deal with all criminal cases
Will hold preliminary hearings of the more serious criminal cases to
determine if sufficient evidence exists to have the accused tried by a higher
court

Provincial Supreme Court

Each province has a Supreme Court or Superior Court to hear the most
serious criminal cases
Assizes sittings of the court held in different places throughout the
province
o Justices of the court periodically travel throughout the province to hear
the serious criminal cases

Youth Courts

Courts for young people (12-18) who are accused of committing criminal
offences
The young are treated like adults
Tried in the ordinary courts if accused of a criminal offence
Supervised by judges who have the powers of a justice or magistrate of a
summary conviction court

Family Courts

Deals with domestic problems

Not a criminal court in the ordinary sense

Where there is a Family Court, it is supervised by a magistrate or provincial

court judge
When there is no Family Court, all domestic issues are heard in the Superior
or Supreme Court of the province

Criminal Courts of Appeal

These courts review the convictions of accused persons by the Youth Court,
Supreme Court, or Magistrates (or Provincial) Court
A panel of judges presides over the Appeal Court
o Decisions are made by votes (majority rules)
Final Court of Appeal Supreme Court of Canada
o Hears appeals from the decisions of provincial Courts of Appeal
o To bring an appeal to the Supreme Court of Canada, one must obtain
leave to appeal
However, if in the case of an indictable offence (where the
person needs to have a trial by jury) if the decision of the
provincial Court of Appeal on a question of law was not
unanimous

Civil Courts

Civil courts deal with disputes that arise between corporations and/or
individuals, or between corporations or individuals and the government
Some civil courts have limited jurisdiction
o Hear only special kinds of disputes
Some civil courts hear appeals from inferior courts
o Courts of Appeal are always non-jury courts
Most civil courts can be heard by both a judge and jury
Small Claims Courts heard by a judge alone

Small Claims Courts

Hears cases where the amount of money involved is relatively small

Informal courts that may be presided over by a superior court judge or
magistrate (in the case of the Provincial Court)
o Usually present their own cases, and costs are low
Right to appeal is restricted to judgements over a specific amount
If an appeal exists to a single judge of the Court of Appeal of the province

Provincial Supreme Court (Superior Court or Court of Queens Bench)

To hear civil disputes in matters that are beyond or outside of the jurisdiction
of the lower courts
Unlimited jurisdiction in monetary matters
Presided over at trial by a federally appointed judge
Cases can be heard by...

o Judges who travel to the various County court houses (the assizes)
o In specified cities where the court sits without a jury on a regular basis
Appeals go to the Appeal Court of the province

Surrogate or Probate Court

Where there is this court, it is established to hear and deal with wills and
administration of the estates of deceased persons
o Presiding judge is the same judge appointed as a local superior court
judge
Where it is not established, these matters are dealt with at the provincial
Supreme Court

Civil Courts of Appeal

Provincial Court of Appeal

Each province or territory has an Appeal Court

The lines of appeal are not as clear cut as in criminal matters
o Appeals in Small Claims Courts Divisional Court (part of the Superior
Court of Justice)
o Appeals in Supreme Court trial judgements Provincial Court of
Appeal, or the Appeal Division of the provincial Supreme Court
(depending on the case)

Supreme Court of Canada

The final and highest Appeal Court in Canada

Hears appeals from the provincial Appeal Courts and Federal Court
Right to appeal to the Supreme Court of Canada is restricted
o Civil case appeals requires permission before a case may be heard
by the Supreme Court of Canada
The issue or legal point must be of some national importance
The body that determines the constitutionality of statutes passed by both the
federal and provincial governments

The Judicial System in Action

Criminal Court Procedure

The Provincial Court in Ontario (or the Magistrates Court in other provinces)
deals with criminal matters of a minor nature
o May also hold preliminary hearings of a more serious criminal offence
Procedure for a minor or less serious criminal case Crown brings the case
to the court by way the summary conviction rules of procedure
Procedure for a serious case bring the case by way of indictment

Regardless of the severity of the case, the case is first heard in the Provincial
Court (Criminal Division) or in the Magistrates Court
o Minor case these courts can dispose of the case themselves
o Serious nature will conduct a preliminary hearing to determine if
there is enough evidence to warrant a full hearing of the case by a
Superior Court
Procedure of the Magistrates or Provincial Court
o Very informal

Judgement a decision of the court

Preliminary hearing
o Ends at the conclusion of the Crowns evidence
Does not need to be all the evidence, just enough to prove there
is sufficient evidence to warrant a further hearing
o If there is enough evidence case is referred to the court with
jurisdiction

Civil Court Procedure

Before a case proceeds to trial, parties exchange a number of documents

(pleadings) that set out the issues in dispute and facts surrounding the
conflict

Pleading written statements prepared by the plaintiff and defendant

that set out the facts and claims of the parties in a legal action, and
are exchange prior to the hearing of the case by the court

Claim

Plaintiff issues a writ of summons against the defendant

o Outlines the particular injury suffered
o Notifies the defendant that the plaintiff intends to hold the defendant
responsible for the injury set out in the claim
o This is usually prepared and submitted to the court by the plaintiffs
lawyer
The court issues the writ upon receiving the writ of summons
When the defendant receives the writ, the defendant fills out a document
called an appearance
o The appearance notifies the courts office that a defence will follow
The plaintiff then provides the defendant and the court with a statement of
claims
o Details of the claim and the facts that the plaintiff intends to prove
when the case comes to trial
o Upon the issuance of the statement of claims, a civil action (a lawsuit
that is not criminal) is commenced

Defence

Upon receiving the statement of claims, the defendant will prepare a

statement of defence
o Outlines the defence that the defendant has to the plaintiffs claim
o May also include facts that are used to support the defence
o This is filed with the court and sent to the plaintiff
When the plaintiff receives the statement of defence plaintiff may set out a
reply
If defendant has a claim against the plaintiff counterclaim (basically a
statement of claim)
o Roles reverse on the counterclaim
If the plaintiff receives a counter claim plaintiff files a statement of defence
to the counterclaim
At this point, pleadings are closed

Close of Pleadings

At this point, either party can sign the case up for trial by filing and serving a
notice of trial on the other party
In the event that a jury may be appropriate, a jury notice may be served
o The party signing up intends to have the case heard by a judge and
jury

Most provinces employ a mediator to seek a resolution through negotiations

before entering a trial
o If a resolution cannot be reached the case then proceeds to a discovery
and trial stage

Discovery

Examinations for discovery a pretrial oral or written examination under

oath, of a person or documents
o To clarify points in the statement of claim or statement of defence
Right to examination is conditional upon delivering an affidavit of documents
o Affidavit A list of all the documents that the party intends to rely on
at trial that relate in any manner to the issue in the action
Includes all documents
Those that the party controls and will produce
Those that are privileged and will not be produced
Those that are relevant but are no longer in possession of
the party
Opposing party may request a copy of the documents listed in
the affidavit in order to better understand and come up with
responses
Oral or written examinations for discovery are limited to matters larger than
$50,000
o Only parties to the action can be examined
o Only one representative from a corporation can be examined
o Unless granted permission from the court
Questions and answers are recorded and may be introduced as evidence at
trial

Trial

Counsel for the plaintiff begins by

o Opening with a statement that briefly sets out the issues and facts that
the plaintiff intends to prove
o Calling witnesses
o Evidence is present to prove the facts in the claim
Witnesses may be subject to cross-examination by defence counsel
Defendant may ask the judge to dismiss the plaintiffs case
If the judge does not dismiss defendant brings witnesses to stand to prove
that the plaintiffs claim is unfounded
o Again, witnesses are subject to cross-examination
Types of witnesses
o Ordinary witnesses testify as to what they saw, heard or did
o Expert witnesses experts in a particular subject and give opinion
evidence on matters that fall within their area of expertise
Evidence must be the best evidence

Cannot be hearsay, unless they are able to bring the person with the
direct knowledge to the court to testify
After evidence counsel argue relevant points of law and sum up respective
cases for the judge
Judge presents a decision
o

Appeal

If either party believes the trial judge erred may appeal to the appropriate
Appeal Court
Must be served within a relatively short time after the trial judgement is
handed down
Counsel prepares an appeal book for the Appeal Court
o Contains material concerning the appeal
The Appeal Court will review the case
o No errors dismiss appeal
o Errors reverse the decision of the Trial Court, vary the decision or
send the case back for a new trial

Court Costs

Defendants and plaintiffs can request the judge to order the other party to
pay the damages and the court costs
Party and party basis
Solicitor and client basis

Contingency Fees

Contingency fees a lawyers fee payable on the condition of winning the

case
Pros: allows for more access to justice
Cons: encourages frivolous cases to be brought to court

Class Action

Class Action an action where a single person represents the interest of a

group, who will share in any award
Require identification and legal recognition that a class of two or more people
exists
o Their issues need to overlap in order to be under the same
representative claim
Pros
o Can combine multiple claims of the same cases together
o If one person brought a complex case to court, the costs of proving the
case may amount to be larger than the award
If multiple people brought the case forward, the costs can be
shared (though the awards are too)

To remind society that a large profit from a tiny wrong done to many
people will not escape justice

Cons
o Difficult to assess the correct amount of damages
There is accommodation in order to address different degrees of
injury among claimants, uncertainty as to how many people
were affected, how many claimants actually participate, and the
different remedies for different claimants
Because it is so difficult, a settlement is often reached between
the class and the defendant
In order for the representative of the class to accept the
settlement, it requires approval by the court as being in
the interest of all the class

The Law Reports

Law reports inform the legal community of the decision of a new or different
legal case
Judicial decisions have been reported in England for hundreds of years
o Year Books
The accounts of the judicial decisions varied in nature and size
Not very organized
o English Reports
The cases became rationalized
Reproduced the older and more important cases
Canadian cases are grouped into different series based on the geographical
location
o Maritime Reports
o Quebec cases are recorded in their own series
o Ontario Reports
o Western Weekly Reports
o Dominion Law Reports
Records cases from all parts of Canada
o Supreme Court Reports
National series that reports only Supreme Court of Canada cases
There are specialized Canadian series of reports that deal with a particular
type of case or courts
o Canada Criminal Cases
o Canadian Bankruptcy Reports
o Canadian Patent Reporter

Case Citations

Cases are recorded methodically for order

Names of the parties year in which the cases was decided volume
name of the report page
o Ex: Wilson v. Taylor (1980), 31 O.R. (2d) 9

2d stands for second series of the Ontario Reports

If not published by volume, but by year...
o Name of Parties., [1937] 1 D.L.R. 21 first volume of the 1937
Dominion Law Reports and the case is reported on page 21
If case is recorded in various reports or appealed to higher courts...
o List all the reports in which the case is found along with the decision
that was made
o Ex: Read v. J. Lyons and Co., [1944] 2 All E.R. 98; reversed, [1945] 1 All
E.R. 106; C.A. affirmed, [1947] A.C. 156
o This case was decided in 1944 appealed to Court of Appeal, where
the decision was reversed in 1945 appealed to the House of Lords,
where the Court of Appeals decision was affirmed in 1947
Now that everything is available digitally, the citation is a little different
o Year province, court judgement number
o Ex: BRZ Holdings v. JER Envirotech International Corp., 2011 BCSC 356
BCSC British Columbia, Supreme Court

Administrative Tribunals

Tribunals are boards or commissions charged with the responsibility of

regulating certain business activities
Established under specific legislation
Statutes state their duties, responsibilities and authority over persons or
businesses that fall under the legislation
Only have power over matters that they are given authority over
Tribunals hold hearings when a partys right has been violated
o If the hearing is deemed unfair, may be appealed to courts
Ad hoc tribunals a tribunal established to deal with a particular dispute
between parties
o Are usually for arbitration purposes
o Can have three members: 2 appointed nominees representing either
party, and a neutral third party as chair (he is selected by the two
nominees)
o Often, only a single, neutral arbitrator is needed

Alternative Dispute Resolution (ADR)

Tribunals are sometimes used as an alternative to the courts in dealing with

disputes between individuals
Advantages
o Speed
o Informality and confidentiality
o Lower cost
Arbitration a process for the settlement of disputes whereby an impartial
third party or board hears the dispute then makes a decision that is binding

on the parties. Most commonly used to determine grievances arising out of a

collective agreement, or in contract disputes
o Frequently used to resolve disputes in contract matters
Mediation

An attempt to resolve the issue before entering a formal arbitration decision

A third party meets with both parties at once, then individually (moving back
and forth between parties) providing suggestions or proposals for settlement
Will come up with a resolution
If the mediator fails, then it moves to arbitration

Arbitration

Much like a court, but is less formal

Selection of (1) arbitrator or an arbitrator board (3 people)
Each party presents their side of the dispute and their evidence
Depending on the type of case, witnesses may be called to stand
The decision is binding
o In the case of an arbitration board majority rules
Parties are expected to bear the cost of the arbitration
Recently, private arbitration boards have been established to resolve civil
disputes
o Operate in a similar manner
o To avoid the slow, costly and formal court system
o Two steps
Settlement conference to resolve issue under the eye of a
mediator
If the settlement reaches no decision arbitration
A streamlined discovery, hearing and award

Advantages of Arbitration

Frequently used to resolve disputes in contracts

o Interpretation of a term in a contract
o The performance of a party
o Businesses do not want to spend money or time, nor jeopardize their
relationship will consult an arbitrator to resolve issues quickly
Confidentiality
o In order to protect private information that may be released if case was
taken to court

Commercial Arbitration

Usually used in complex contracts between international companies

o The complexity may cause issues regarding performance

International business deals dont know how other court systems

are like; which judicial system to follow?
Domestic business contracts often have an arbitration clause included
o Leasing contracts
o Franchise agreements
o Equipment leasing
o

Labour Arbitration

In most provinces, it is mandatory to include an arbitration clause between

employers and labour unions

The Legal Profession

Attorney lawyer
Solicitors a lawyer whose practice consists of the preparation of legal
documents, wills, etc., and other forms of non-litigious legal work
Barrister a lawyer who acts for clients in litigation or criminal court
proceedings

The Role of the Legal Profession

Legislation
o Limits right to practice law to people admitted to practice
o Control of the profession through provincial law society or association
o Allows the society to enforce rules of conduct
o May disbar or disciple members
Lawyers of business law
o Advise a client of the legal implications of the course of action
proposed
o Act on behalf of the client to protect his or her interests and give effect
to the action undertaken
o Assist in negotiation of collective agreements
Usually when the case is brought before an arbitrator
o Attend to the necessary legal work associated with the protection of a
name or mark, patent, trademark or copyright
o Assist in incorporating a form, merging firms, taking care of the
financing of take-overs