Law Times

July 27, 2015

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Page 2 July 27, 2015 • Law Times www.lawtimesnews.com such rights and preventing their violation." Although the provisions of Bill C-51 that deal with free speech seem to have attracted the most attention, challenging them will likely prove more difficult given previous rulings in similar mat- ters, Agarwal suggests. "The Supreme Court of Can- ada did not have much time for the constitutional challenge on free speech grounds to the Anti- terrorism Act in [R. v.] Khawaja. I think a constitutional challenge here is difficult as the object of the bill seems to be to capture threats of violence, which are not consti- tutionally protected." In 2012, the top court dis- missed appeals by Mohammad Momin Khawaja and two other men accused of terrorist activity who had argued that sections of the Criminal Code defining ter- rorist activity were too broad and threatened freedom of expression. The notice of application con- tends that Bill C-51's amendments to the Criminal Code will "have a chilling effect on freedom of expression and association, even if no prosecution is ever brought. Persons will prefer to remain si- lent rather than risk the perils of prosecution, especially since the offence can reach even those who do not have a terrorist purpose and there is no statutory defence." Part 3 of the new Ant-terror- ism Act includes an amendment to the Criminal Code that states that anyone is guilty of an of- fence who, "by communicating statements, knowingly advocates or promotes the commission of terrorism offences in general . . . while knowing that any of those offences will be committed or being reckless as to whether any of those offences may be com- mitted." The phrase "terrorism offences in general," the notice of application states, is "unconsti- tutionally vague and imprecise. . . . As such, the prohibited speech and conduct are neither fixed nor knowable by citizens in advance." Judges, however, may not ac- cept that argument, says Agarwal. "I think the bill will create a chill- ing effect on radical, aggressive speech but I think the judicial an- swer will be to read the provisions narrowly based on the particular facts of any charge," he says. Elliott Willschick, a crimi- nal lawyer with a background in constitutional law, disagrees. That section of the legislation, he says, could potentially crimi- nalize statements such as those made by some people after the Sept. 11, 2001, terrorist attacks that terrorism is a tool of the poor because they don't have organized armies to carry out what a state could undertake. Courts will find the wording "far too vague," he says. "I think that's where the courts are highly likely to overturn that part of the legislation or ask the government to make it more spe- cific," says Willschick. Faisal Bhabha, a professor of constitutional law at Osgoode Hall Law School, says one strong point made in the challenge is its argument against amendments to the Immigration and Refu- gee Protection Act. Part 5 of the new Anti-terrorism Act amends the immigration law to allow the minister of public safety and emergency preparedness to deny non-Canadian citizens detained on immigration grounds access to information about the govern- ment's case against them. "The Supreme Court of Canada has already ruled and has already made it pretty clear that this sort of system does not pass constitutional muster and ordered the government to go redesign the system. And now through this law, they've reintro- duced essentially the same sys- tem that was previously declared to be unconstitutional. So there's a no-brainer," says Bhabha. "That doesn't mean it's going to be an easy case," he adds. "Courts tend to be reluc- tant to strike down legislation. But at the same time, we have a powerful Charter of Rights and Freedoms in this country. . . . My prediction always is that courts will do what they can to find some sort of balance." Especially in politically controversial cases, the current Supreme Court has "done everything it can to split the difference or try to reach some sort of accommodation between government interests and concerns around potential Charter breaches," according to Bhabha. When it comes to Supreme Court of Canada findings that legislation is unconstitutional, "what they've typically done is throw it back to the government as a remedy to fix it," he says. While a long and drawn-out case is certainly possible, predic- tions about it are difficult since the law's fate hinges to a great ex- tent on the results of the upcom- ing fall election, Bhabha notes. LT Canadian residency requirements for boards of directors. If the government adopts that proposal, more multina- tional corporations will likely set up Canadian subsidiaries in Ontario rather than formally incorporating in places such as New Brunswick and British Co- lumbia that don't have that re- quirement, says Graham Erion of DLA Piper (Canada) LLP. Another proposal would allow the incorporation of unlimited- liability corporations in Ontario, something that would be "re- ally helpful from a tax-structuring perspective for foreign companies who want to establish a business presence here or at least have some assets here," says Erion. Another potential "game- changer," says Erion, is a pro- posal to expand the availability of limited-liability partnerships beyond professionals such as lawyers and accountants. Engineers, architects, and den- tists, for example, may find the limited-liability partnership model attractive. The proposed changes aren't likely to affect the organization of law firms specifically, says Er- ion, although allowing new types of corporations is likely to mean more work for lawyers. "I think there's going to be a lot of business opportunities there for lawyers as some of these structures — the ULC structure, the LLP structure — become more widely available," he says. "This is going to be good for the legal profession as a whole." In general, he says, the reduced complexity that should result from the proposals should make life better for businesses and their lawyers. "A lot of this legislation nobody really looks at," he says. "So I just think it's timely, I think it's exciting, and I think it's going to provide a lot of clarity for busi- nesses and for counsel once this stuff gets cleaned up a little bit." Something that's particularly overdue, according to lawyers, is a proposal to repeal the Bulk Sales Act, a piece of legislation dating back to 1917 aimed at protecting creditors from com- panies selling all or most of their assets quickly without paying them back. "I think we're the only jurisdiction in North America left with such legislation," says Roth- berg. "It's archaic." Another proposal suggests lift- ing a provision that directors must provide their formal consent in advance for participants to attend a meeting by phone or other elec- tronic means, something Erion calls a "ridiculous" requirement. It's lamentable, says Rothberg, that the mandate of the panel wasn't wider since the change Ontario business really needs re- quires a collaborative effort across ministries. "It's being done in a vacuum so that it doesn't really talk about big-picture issues," he says, referring to Ontario's corpo- rate and small-business tax rates. "Nobody has even consid- ered that within this mandate and we're certainly not the most competitive province. Our small- business rate is at the high end of the country," he says. Laws around the province's mining industry also need an up- date, says Rothberg. Bill Northcote, chairman of Shibley Righton LLP's business law practice group, agrees the gov- ernment should be going further than simply trying to keep pace with other jurisdictions. "Ontario is in a catch-up stage of its legisla- tion rather than leading change," he says. "I would have liked to have seen the government be a little bit more innovative than they are." For example, he says, British Columbia and many U.S. states now allow benefit corporations intended to achieve a public pur- pose, such as alleviating poverty or protecting the environment. Clothing manufacturer Patago- nia Inc. is one such corporation, he says. Ontario legislation, how- ever, doesn't include them. The ministry will be accepting feedback on the report until Oct. 6. Meanwhile, the OBA is plan- ning to host a business law reform summit on Oct. 8 aimed at getting opinions from lawyers, business leaders, and the government. 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