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PAGE 12 FOCUS January 25, 2010 • Law Times national securities regulator in this country. 'Closer than ever' to single securities regulator T BY JULIUS MELNITZER For Law Times he arrival of 2010 may just turn out to be the dawn of the age of the "Th ere has been more com- mitment from this government than at any time since the issue came up in the '60s," says Philip Anisman, a Toronto securities lawyer. "Th e Conservatives have gone beyond talking to creat- ing funding in the last budget; establishing a national securities regulator transition offi ce; and announcing their intention to refer draft legislation to the Su- preme Court of Canada." Momentum gathered with the release of a report by the Expert Panel on Securities Regulation last February. Its central theme was that Canada needed a single regulatory au- thority with a strong and de- centralized structure that would promote the benefi ts of the cur- rent system while addressing its shortcomings. It recommended the adoption of a comprehen- sive national securities statute and a national regulatory sys- tem administered by a new Ca- nadian securities commission. Th e expert panel envisaged Regulatory and Corporate Liability: From Due Diligence to Risk Management Your guide to the legal assessment, application and a complete understanding of these important yet complex concepts Gain important perspective on the liability of organizations in regulatory and criminal contexts, and find out how to limit liability and the risk of prosecution. This resource deals with issues that are relevant to many areas of the law including occupational health and safety, the environment, competition and securities. ORDER your copy today Looseleaf & binder • $205 • Releases invoiced separately (1-2/yr) P/C 0134030000 ISBN 0-88804-420-8 Find expert guidance and insightful analysis on: • the basis for regulatory and criminal liability • how regulations apply to organizations and individuals • in-depth analysis of Bill C-45 • how to deal with charges • how the principles of sentencing will impact upon a given scenario • navigating the regulatory and criminal liability systems in Canada the commission as the securities regulator for those provinces and territories that agree to par- ticipate. Other provinces would be able to opt in from time to time. Th e report also said mar- ket participants should be able to choose regulation by the na- tional body. Th e report diff ered in focus from previous studies by tak- ing an international perspective and emphasizing the need for a national securities regulator to address systemic risks in capital markets and represent Canada on the global stage. 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TitlePLUS title insurance and you, TitlePLUS title insurance and you, together we have all the tools 1-800-265-8381 $3.55 • Vol. 20, No. 13 Covering Ontario's Legal Scene April 20, 2009 BY ROBERT TODD Law Times F dicial Council's decision to call for his ouster, saying he was compelled to resign due to his pending retire- ment, despite finding aspects of the council's report "troublesome." Cosgrove tells Law Times in an interview that once the CJC issued its recommendation to the justice minister, "My options were pretty narrow." While he believes he could have appealed an earlier committee report at ormer Ontario Superior Court justice Paul Cosgrove has spo- ken out on the Canadian Ju- month after the CJC issued a final re- port stating that his actions in a late- Cosgrove 'Shock and disappointment' Cosgrove says 'life goes on' after the bench people in public office, and they were given little weight, according to the decision." Cosgrove's final criticism is the CJC's determination that the issue of public confidence was central to its decision. He suggests that it remains unclear what evidence is required to make such a determination. inquiry the Federal Court, he says a decision was un- likely before his mandatory retire- Former Superior Court justice Paul Cosgrove tells Law Times that his ment took hold in December. resigned earlier this 1990s murder trial led to the conclusion that he "failed in the execution of the duties of his judi- cial office and that public confidence in his abil- ity to discharge those duties in future has been irrevocably lost." The decision made him only the second federal judge to meet such a fate. But the former judge says parts of the CJC's the senior regional judges in Ottawa since I've been here for the last 24 years, all wrote very positive recommendations, and they also were aware of the trial," says Cosgrove. "So to say that these letters, the people had final report could have been challenged. The council did not use a set of 32 letters of pending mandatory retirement compelled him to resign from the bench rather than battle a call for his ouster. given rise for us to challenge," he says. "The problem with that is, of course I'm retired — manda- tory retirement in December of this year. And the process, for ex- ample, dealing with the constitu- tional issue, took three years." He says he did not want to "So, all of those issues may have Financial Matters 9 with 20,000 pages of evidence likely put forth. The 74-year-old former judge, who will gamble and let the matter play out before Parliament, where an un- precedented joint resolution would have been required to finalize his ouster. Doing so may have proved cumbersome, suggests Cosgrove, no knowledge of what was going on was not accurate." Cosgrove also suggests the council should support written by judges and retired judges, law- yers, and members of the public when coming to its decision, saying they were irrelevant, he notes. "Personally, I found that difficult because, for example, there were my supervising judges, have used the letters from community mem- bers when considering whether he had lost the public's confidence. "It would seem to me that it's logical to test collect an annual pension of about $170,000, says that before the decision he was reason- ably confident that the council would not call for his dismissal. Independent counsel Earl Cherniak, a partner at Lerners LLP, had previ- ously told the council such a stern punishment was not necessary. "It was shock and disappointment," Cos- what the public's demeanour is; you ask people who are knowledgeable in the public," he says. "And there were a number of letters from See Cosgrove, page 4 Focus On ADR/ Mediation Inside This Issue 3 Fight Over Fees 6 Quote of the week grove says of his reaction to the final decision. He says he has been dealing with the fall- out by responding to media inquiries, and "It is now incumbent on sports federations in selection disputes to show they had the proper criteria set up and that it was properly applied . . . The onus is now on the organiza- tion not the athlete. It wasn't quite as clear a few years ago." BY TIM NAUMETZ For Law Times OTTAWA — The possible closure of McCarthy Tétrault LLP's high- profile office in the nation's capital is unrelated to dire economic cir- cumstances that have hit home for some Canadian law firms, a senior McCarthys partner says. Future uncertain for McCarthys' Ottawa office zation we review our business plans on an ongoing basis," Boake tells Law Times when asked of the Ot- tawa office closure possibility. She adds the firm wants to meet the needs of its clients, and that each of its offices have a practice and focus which aligns with McCarthys' over- all strategy. "So it's in that context "Yeah, I guess, like any organi- staff, remains undecided. "It's really just a question of the fact that we are in discussion with lawyers there as part of an overall strategic review," she tells Law Times. "These discussions have been decisions" because of a drop in busi- ness due to the economy, letting go less than 20 of its 650 lawyers across the country. She would not give the specific number or other details. Gowling Lafleur Henderson going on for a while and are not related to the economy," she says. "I would call it a strategic review. Our firm really focuses on integrat- The financial crisis that has hit directly New York and London, being financial centres of the world, and the financial institutions based there, has not hit to the same degree in Canada, primarily because of the strength of the financial institutions in Canada. McCarthys' Ottawa contingent is a "strategic review" based on the firm's national business plan, and the role played by all of its six loca- tions across Canada, says Barbara Boake, national leader, profession- als, at McCarthy Tétrault. Consideration of the future of that we're currently reviewing the Ottawa office, but no decision has been made to close it," she says. Boake would not divulge fur- ther details and said the fate of the office, along with the employ- ment of its seven partners, two associates, and 11 administrative ed practices; we have offices right across the country. We have a very diversified practice geographically and our overall strategy is to inte- grate those practices and develop client teams on a firm-wide basis." Boake, however, confirmed Mc- Carthys has taken "difficult staffing LLP also confirmed to Law Times the firm released staff last week. But Gowlings chairman and CEO Scott Jolliffe said the shakeup did not involve partners or associ- ates. Jolliffe says the firm is shifting toward a "pod" model where law- yers and associates share a smaller number of secretaries, but he would not say how many were affected. The move not only economizes, but also creates a team atmosphere among secretaries that is useful for mentoring and sharing workloads. Sources in the legal community See Ottawa, page 4 say McCarthy Tétrault's Ottawa re- view may be related to a management WHICH DIRECTION IS BEST FOR YOU? RainMaker Group 110 Yonge Street, Suite 1101 Toronto, Ontario M5C 1T4 www.lawtimesnews.com Tel: 416-863-9543 Fax: 416-863-9757 www.rainmakergroup.ca has engaged the public, united the business community, and attracted strong backing from investor advocates who realize that Canada has been slow in coming to grips with the fact that the regulation of capital markets occurs on an interna- tional level. "One of the principal weak- nesses of the current system of 13 regulators is the lack of na- tional accountability," says Jere- my Fraiberg of Osler Hoskin & Harcourt LLP. "But the system also suff ers from suboptimal en- forcement, compromise and de- lay in policy development, and duplicative costs." Even provincial politicians have come on board. British Co- lumbia Premier Gordon Camp- bell has agreed to co-operate, leaving Alberta and Quebec as the two principal holdouts along with a skeptical Manitoba. 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L4G 3S9 Tel: (905) 727-0077 Fax: (905) 841-4357 Mail or fax this form to Law Times www.lawtimesnews.com LT_1-4sub.indd 1 12/16/09 11:04:45 AM moved swiftly following the report's release. Th e budget implementation bill, which re- ceived Royal assent last March, allocated $33 million for a tran- sition offi ce to develop a new federal securities regime. Th e bill also authorized the minister of fi nance to make up to $150 million available to the provinces for matters relating to the establishment of a new re- gime; provided for the creation of an advisory committee of par- ticipating provinces and territo- ries; and allowed the government to enter into agreements with the provinces and territories with regard to securities regulation. Th e transition offi ce started work in the fall and is currently formulating draft legislation that the government has announced it will present to the Supreme Court. To be sure, little news has of come out the transition The current system suffers from a lack of enforcement, delays in policy development, and dupli- cation, says Jeremy Fraiberg. offi ce in the last few months. But Heather Zordel of Cassels Brock & Blackwell LLP, the only lawyer appointed to the expert panel, says that doesn't necessarily indicate a lack of progress. "Just because it's quiet doesn't mean that nothing's happening," she says. "To start with, there's no question about the viability of the transition of- fi ce, and from all appearances the development of a plan, a structure, and legislation is tak- ing place within the expected timelines." Still, caution is essential. "If we're going to transi- tion, we have to make sure that there will be no disruption to the marketplace in any sense," Zordel says. "Th at's a fairly mas- sive logistical exercise." Fraiberg is of similar mind. "Market participants need assurance about the stability of any new regime and need to understand the rules governing the relationship between partic- ipating and non-participating jurisdictions if some provinces choose not to opt in," he says. However, not all is well. At press time, Quebec had referred its own constitutional questions to its Court of Appeal, and Alberta had announced its intention to follow suit in its top court. But Anisman maintains that the very existence of two sepa- rate provincial references to go with the federal one speaks loudly to the need for a national regulator. "Th is type of fragmentation highlights the diffi culties that can arise without a single regu- lator," he says. For her part, Zordel believes the opposition of Quebec and Alberta so far represents less of a challenge to the ongoing eff orts than some might imagine. "Th e original thinking was that Alberta and Quebec wouldn't be onside initially, and in fact things are mov- ing along as expected with- out them," she says. "Th e fact remains that we're defi nitely closer than ever to a national securities regulator." LT www .lawtimesnews.com Includes a FREE digital edition! The Honourable Todd L. Archibald, Kenneth E. Jull and Kent W. Roach (Criminal Liability of Organizations) An Act to Amend the Criminal Code