This will impact skip tracers as this change becomes more widely known. While it is now harder for debtors to use an Ontario name change to elude creditors, it still happens.

The Bank Act (1991, c. 46) is an Act of the Government of Canada respecting banks and banking.  The Canadian banking industry includes 20 domestic banks, 24 foreign bank subsidiaries and 22 foreign bank branches operating in Canada.

Canadian Banks & Lending

Canadian Banks have the right to lend money to wholesalers, retailers, shippers and dealers in “products of agriculture, products of aquaculture, products of the forest, products of the quarry and mine, products of the sea, lakes, and rivers, of goods, wares and merchandise, manufactured or otherwise” on the security of such goods or products, and to lend money to manufacturers on their goods and inventories.

The Private Investigator (PI)

When doing a background investigation of a person, the PI will be looking for previously unknown assets, banking and financial arrangements, or corporate affiliations.  When investigating a company, the PI will be looking for previously unknown assets, banking, and financial arrangements.  In both cases, the equity held by the subject in the assets will be of interest.  Searching the Bank Act Security Registry may reveal all of the above.

Bank Act Security Registry

Under S. 427 of the Bank Act, the borrower must sign a document that provides the bank with the first preferential lien on the goods or equipment.  The Bank then registers a ‘Notice of Intention‘ to take the goods as security, to perfect its security interest.

The Bank of Canada offers a Security Registry service which may be searched for registrations.  The search will reveal whether the Bank of Canada has taken security on property that may interest you.  If the Bank does have a claim on the property, then it means that it has loaned the customer money and that it has the right to take possession of and sell the property if the loan is not paid.  This is important for you to know for two reasons.  First, it shows that the person or business is indebted to a Canadian chartered bank and may have equity in the property listed in the security agreement.  Second, it may uncover previously unknown assets, banking and financial arrangements, or corporate affiliations. You will need to provide the name of the person or business being searched.

Years ago, we only did this when we suspected the subject person or company might have an interest in an agricultural business.  Today however, we find more non-agricultural businesses in the Bank of Canada registry. We have online access to the Bank of Canada registry to search for Bank Act Security items. The search results often indicate that a business assigned its inventory to a bank as security under the Bank Act.

A manual search for Notices of Intention filed under Section 427 of the Bank Act are conducted at the agency of the Bank of Canada in the province or territory where the debtor’s place of business is located. For Bank Act searches,  “agency” means, in a province, the office of the Bank of Canada or its authorized representative but does not include its Ottawa office, and in Yukon, the Northwest Territories and Nunavut means the office of the clerk of the court of each of those territories respectively [see S. 427(5)].

Canadian government has passed legislation to address spam (though it is still awaiting proclamation).

“Known as Canada’s Anti-Spam Law, or CASL1, the new rules go much further than restricting bulk, unsolicited e-mail messages, by creating an express consent regime that applies to almost all e-mails and other electronic messages sent for a commercial purpose. And unlike the U.S. CAN-SPAM Act, which applies only to e-mail, CASL’s anti-spam provisions also apply to other forms of electronic communication, such as text messages, instant messaging and social media messaging.”

This division of power forced the Trudeau government to remove the right to private property from the Charter of Rights when the provinces protested its inclusion. The provinces saw this as limiting their ability to tax, expropriate, and exercise control over property ownership. Neither the federal nor provincial governments are under any constitutional obligation to pay fair (or any) compensation for expropriated property. The Constitution Act 1867 and the Charter of Rights do not address this issue. Legislatures are also free to legislate away your ability to use any property for any purpose. Ontario and Quebec will probably try this route to control firearms ownership once the Long Arm Registry is eliminated by the federal government.

This is starting to backfire. Landowner associations and grass-roots movements are starting to form in Ontario and Alberta.  These groups and movements to include property rights into the Charter of Rights will become a prominent feature of the political landscape in years to come.

These injunctions are widely recognised in common law jurisdictions and such orders can have world-wide effect.  Similar provisions are now available in the rest of Europe, under Article 9(2) of the European Union Directive on the enforcement of intellectual property rights, which was approved in April 2004.

The injunction is often granted ex parte and pre-trial based on affidavit evidence alone.  A Norwich order sometimes precedes the Mareva Injunction.  A Mareva Injunction is often combined with an Anton Piller order. The combination of a Mareva Injunction and an Anton Pillar order can be devastating to a business or professional person by freezing assets and revealing proprietary processes and data to competitors. However, this does prevent a foreign company from removing its assets from the country before a trial can take place. Today’s telecommunications makes moving assets almost instantaneous. The Anton Pillar order prevents the destruction of evidence before trial.

A Norwich order is a pre-action discovery mechanism.

In Norwich Pharmacal Co. v Customs and Excise Commissioners [1974] AC 133, the owner of a patent knew that infringing goods were entering the UK, but could not ascertain the identity of the goods. The Commissioners, in the course of performing their duties, had information that would identify the imports.  Also, they had unknowingly played a part in facilitating importation of infringing goods. The House of Lords found that where a third party had become involved in unlawful conduct, they were under a duty to assist the person suffering damage by giving them full information and disclosing the identity of wrongdoers. If the third party bears expense in assisting compliance with an order, the person seeking assistance is bound to reimburse those expenses. That expense however would be reflected in an award of damages against the ultimate tort-feasors, and this be recovered after the final hearing.

Canada and the Norwich Order

The Court in Isofoton S.A. v. Toronto Dominion Bank, outlined five elements that a court should consider before granting a Norwich order.

(i) Whether the applicant has provided evidence sufficient to raise a valid, bona fide or reasonable claim; (The standard required is that the claim
is not frivolous or vexatious.)
(ii) Whether the applicant has established a relationship with the third party from whom the information is sought such that it establishes that the third party is somehow involved in the acts complained of; (The Court confirmed that a bank in receipt of allegedly fraudulent funds will be considered an innocently-involved third party.)
(iii) Whether the third party is the only practicable source of the information available; (The victim is not required to approach the alleged wrongdoer for the information. Often, financial institutions are the only real source of the information required to prove a claim and locate fraudulently transferred assets.)
(iv) Whether the third party can be indemnified for costs to which the third party may be exposed because of the disclosure, some [authorities] refer to the associated expenses of complying with the orders, while others speak of damages; (The Court in Isofoton rejected the argument that an undertaking as to damages was required, stating that it was difficult to envision a situation in which a financial institution that is subject to a Norwich order would be subject to liability and a damages award for disclosing financial information. The Court further advised that should a concern materialize on the facts of a specific case, the financial institution has the added protection of being able to seek legal advice and return to court for further direction, if necessary.) and
(v) Whether the interests of justice favour the obtaining of disclosure. [emphasis added] (The courts are reluctant to protect the rights of wrongdoers if maintaining confidentiality in essence protects fraudulent acts.)

In Isofoton, the Court found that the alleged wrongdoer’s right to privacy did not outweigh the victim’s right to access the information required to pursue its legal remedies. The Court based its decision on the following three reasons:

• Confidentiality in bank records is not absolute, as the records are subject to disclosure by court order in a variety of circumstances.

• The use that could be made of the information ordered disclosed was restricted by the terms of the order.

• The wrongdoer, to the extent that it acted fraudulently, did not have a right to the protection of confidentiality normally afforded to bank records.

Liability & Indemnity

In the past, financial institutions have been held liable for breaching confidentiality obligations owed to their clients in assisting other financial institutions or wronged parties in instances of alleged fraud. The Norwich orders removes liability from financial institutions for responding to allegations of fraud made against a client. The financial institution may reasonably take the position that it will not disclose confidential information without a Norwich order compelling it to do so. The fraud victim must establish that a Norwich order is required and for the court to determine whether such an order ought to be granted.

Norwich orders allow financial institutions to assist fraud victims while also protecting their clients’ legitimate expectations regarding confidential information.

Usage in Canada

While a Norwich Order is normally associated with finding monies obtained through fraud, however, it may also be used to find an IP address. The Internet Service Provided may be presented with a list of IP addresses and required to deliver up the names and addresses of the individuals using those IP address at the designated times pursuant to the Norwich Pharmacal Order. This is becoming more common in cases of Internet defamation.

The Ontario Superior Court of Justice allowed the issuance of a Norwich order in York University v. Bell Canada Enterprises.  The case is based on an allegedly defamatory e-mail about the President of York University, Mamdouh Shoukri, saying he had “perpetrated an outrageous fraud.” Bell Canada Enterprises and Rogers Communications Inc. were ordered to disclose the identity of the account owners.  A previous Norwich order had been approved against Google back in May 2009, which identified the two ISPs as the holders of the information.

Both Bell and Rogers had privacy policies protecting customer data, but these could be overridden by the Norwich order pursuant to s. 7(3)(c) of PIPEDA.

There is some confusion going around about Bill C-23. It was split into two parts, and because the second part, C-23B, has been the most debated, people associate C-23A, which received Royal Assent on 29 Jun 2010, with the changes proposed by C-23B, which has not yet been made law.

Bill C-23A only covers certain aspects of the full bill, while C-23B covers the bulk of the changes. Part A, which has been made law, covers the following:

1.    Lengthens pardon waiting periods from 3 years to 5 years and from 5 years to 10 years for certain crimes.

2.    Puts the onus on the applicant for proving that a pardon would bring them measurable benefit.

3.    Gives the Parole Board of Canada more discretion for granting pardon applications.

Bill C-23B will bring a few more changes, but for now, these are the basic changes that have already taken place. C-23B is scheduled for its third reading on March 24^th and will undergo clause by clause consideration in April. For more information on these changes, please visit: http://www.canadianpardons.ca/. The Pardon & Waiver Wiki and Blog pages should be very  useful if you need to understand the Pardon and Waiver process in Canada.

Since April 15, private investigators have been subject to a new basic training and testing requirement. Recent estimates at some agencies put failure rates at about 50 per cent.

Criticisms of the new system include the fact that there’s no approved curriculum for the training component; that those who design the courses don’t get to see the exam beforehand; and that the test is too broad and not necessarily relevant to the work private investigators do.

As well, people have complained that there’s no handbook to help prepare for the test. “There were questions on it that I will never come across in my area of expertise,” one commentator identifying as a private investigator recently wrote on lawtimesnews.com.

It’s obvious, then, that there are flaws. Once again, good intentions at ensuring and raising proficiency standards are having unintended consequences.

We have to ask why the Ontario government is testing for useless knowledge? The simple answer is, because they can. The more arcane the knowledge, the easier it is to include in the test. It has become like those old advertisements, ” winners must pass a skill-testing question”.

This process is so poorly conceived and executed that one has to wonder if an underlying agenda is present, perhaps one that entails the elimination of as many PI’s as possible. This process has already driven productive individuals from the industry because the testing does not even touch on what they do for a living. The Law Times article above does not mention that failing the test means the immediate loss of the person’s license, and consequently, his or her job. These people can not afford to spend thousands of dollars for courses and retesting in the hope of getting another job to replace the one they lost as a result of failing the test. This process also means the end of the part-time Investigator in Ontario. The part-time employee is not going to expend money on courses and go through the testing process to earn a few hundred dollars per month.

]]> http://www.confidentialresource.com/2010/10/20/good-intentions-gone-bad/feed/ 5 http://www.confidentialresource.com/2010/10/06/division-of-powers-criminal-law/ http://www.confidentialresource.com/2010/10/06/division-of-powers-criminal-law/#comments Wed, 06 Oct 2010 11:00:08 +0000 Richard McEachin http://www.confidentialresource.com/?p=1029 Under the division of powers, the federal government has exclusive jurisdiction over criminal law and procedure (section 91(27) of the Constition Act of 1867) the provinces have jurisdiction over the administration of justice, including criminal matters (section 92(14)) and penal matters (section 92(15)) regarding any laws made within provincial jurisdiction. Thus Canada has a single Criminal Code but many provincial laws that can result in incarceration or penalty.

Criminal and Civil Courts

This means that the Administration of Justice in the Province, including the Constitution, Maintenance, and Organization of Provincial Courts, both of Civil and of Criminal Jurisdiction, and including Procedure in Civil Matters in those Courts are matters handled by the Province. It also means that the Province handles the Imposition of Punishment by Fine, Penalty, or Imprisonment for enforcing any Law of the Province made in relation to any Matter coming within any of the Classes of Subjects enumerated in  Section 92 of the Constitution Act of 1867.

For the Investigator, this means that the majority of the criminal prosecutions occur in courts administered by the provinces and that most civil actions are issued in provincial courts.

The Canadian Federation

Canada is a federation with two distinct jurisdictions of political authority: the country-wide federal government and ten provincial governments.  Presently, the three territories are creations of the Federal Parliament and exercise delegated power and not sovereign power.

The federal nature of Canadian constitution was a reaction to the range of colonial diversities of the different regions of Canada. Federalism was also considered essential to the co-existence of the French and English Canada.

The division of powers between the federal and provincial governments was initially outlined in the British North America Act, 1867 (now the Constitution Act, 1867), which, with amendments to both, form the Constitution of Canada. The federal-provincial distribution of legislative powers (also known as the division of powers) defines the scope of the power of the federal parliament of Canada and the powers of each individual provincial legislature or assembly.