Law Times

June 27, 2016

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Page 2 June 27, 2016 • Law Times just options and that the working group will hammer out potential regulatory solutions in the future. "In respect to all of this, we don't have answers," he said. "What we have are concerns and that's why the next stage is to reach out more broadly." The working group was estab- lished after the law society heard concerns about the increase in advertising of personal injury law in particular, as well as real estate law. A lack of transparency has been central to many com- plaints about advertising and the way firms have used referral fees. Some firms support an out- right ban on advertising, such as Thomson Rogers. The firm's lawyers have argued that heavy advertising has led consumers towards personal injury firms with a large advertising presence rather than the firm with the ser- vices that are right for their needs. "The concern we have is that credentials and other conditions of competency are being lost amongst this noise that's created by this f lood of advertising," says Deanna Gilbert, a partner with Thomson Rogers. "So we support a ban and I think that will force members of the public to take a closer inves- tigative look at the lawyers that they're choosing." The report noted that ad- vertising can serve as a tool to spread awareness of spreading legal services, but Gilbert says it is not necessarily positive be- cause of the services that are be- ing advertised. "Just knowing I can get a lawyer doesn't help me in the long run," she says. "Helping me get a competent lawyer is going to help me in the long run. The mass marketing does not help in that sense." The report also addressed the issue that over the years, refer- ral fees have also risen to a point where they are sometimes more than 20 per cent. The report said that stakeholders generally agreed referral fees were an important way of making sure a client finds the legal service they need, but that there should be a cap. The Ontario Trial Lawyers Association has called for a 10-per-cent cap on all referral fees. The report also touches on second-opinion advertising — when a firm advertises in a way that targets clients who already have lawyers. Adam Wagman, the president of the OTLA, called for the law society to act quickly to bring an end to sec- ond-opinion advertisements. "There's an ad on the radio right now — you can hear it at ev- ery Blue Jays game — that specifi- cally says, 'Are you unhappy with your lawyer? If so make a trade,'" Wagman says. "How can that be interpreted in any way other than that it is intended to inf luence a person who already has a lawyer to change their lawyer?" Beyond personal injury law, real estate law was an area identi- fied where a lack of transparency in advertising is causing concern. The report identified that "all-in fees" advertised by real estate lawyers do not always dis- close all costs to the client. In a market where small price differences can determine which firm a client chooses, it is particularly important they are not misled, the report said. "There is a lot to be desired in full and transparent disclosure of real estate fees and disburse- ments that are quoted on the In- ternet," says Bob Aaron, a real es- tate lawyer with Aaron & Aaron Barristers and Solicitors. LT British Columbia is also considering changes to its own legislation. Sutin says the amendments encourage more uniformity in the way the vari- ous provinces handle franchise documents and bring Ontario more in line with how the Unit- ed States delivers such forms. "It just allows some options, particularly when a prospective franchisee may be on the other side of the country," she says. While the amendments are being hailed as a step forward, some lawyers have some linger- ing concerns. Sutin is supportive of the amendments, but she is worried about a provision in the new rules that requires franchisors to get a written receipt when they send disclosure documents electronically. "A prospective franchisee could possibly not deliver a receipt and just withhold it," she says. If franchisees do not receive franchise disclosure documents, they have up to two years to re- scind the agreement. The requirement therefore could prove problematic for franchisors, who would need to prove they sent the disclosure documents, Sutin says. While there could be other ways to prove the documents were sent electronically, the requirement itself complicates things, she added. "We don't know today how a court is going to interpret that," she says. "Is a court going to say, if you don't have a written acknowl- edgement of receipt from a pro- spective franchisee, does that mean that a disclosure docu- ment was not delivered elec- tronically or otherwise?" Peter Viitre, a franchise law- yer with Sotos LLP, says the requirement does not really change much as the onus was al- ways on franchisors to demon- strate the franchisee provided disclosure documents. "Its substance doesn't change what we already have," he says. "You're not going to do any- thing in any event until you have that receipt." Viitre says the final changes are better than the original draft legislation, which said disclo- sure documents "were not effec- tive until the franchisor receives an electronic acknowledgement of receipt from the prospective franchisee." At the time the draft legislation was being considered, the Ontario Bar Association voiced concern to the Ministry of Government and Consumer Services. LT NEWS Continued from page 1 Advertising ban supported by some firms Continued from page 1 Need for written receipt a problem Untitled-2 1 2016-06-21 9:49 AM

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