With the news cycle being faster than ever before, and serious new issues seeming to arise every few weeks, it can be hard to stay up to date, let alone digest the implications they may have on future operations and decision making. How can in-house counsel keep on top of it all?
As part of Conference 2022: Deconstructed in May 2022, the CCCA partnered with Mondaq to host a panel of leading lawyers from across Canada to look at the big challenges heading our way and the potential impacts that in-house counsel should be preparing for.
Economic Sanctions
Martha Harrison, a partner at McCarthy Tétrault LLP, began with an overview of the Canadian economic sanctions system. She explained that the system of sanctions and related measures are enacted in response to socio-political urgencies. Economic sanctions can be placed against a jurisdiction, individual or entity as a result of what Canada considers to be a gross violation of human rights or terrorist activities.
Currently, 200 entities and 1000 individuals are under sanctions in Ukraine, Russia and Belarus. Sanctions there and in other parts of the world have implications on not only companies with direct dealings but also all Canadian businesses. Harrison urged, “Even where Canadian businesses don’t have those jurisdictions that are sanctioned in immediate contractual arrangements, it’s important to understand the world of your contractual arrangements and where your service providers and your partners could touch on that part of the globe as well.”
Moving forward, Canadian companies should perform service chain and supplier audits to understand their systems and the impact on their global operations.
Anti-Money Laundering
The presentations moved from world events to Canadian events as Simon Grant, a partner at Bennett Jones LLP, discussed the Ottawa “Freedom Convoy” and its effect on the financial regulatory world, which has implications for in-house counsel that will be highlighted now and in the future.
Grant pointed out two temporary changes in particular that were made to anti-money laundering rules:
- Entities such as crowd-funders and payment processors are now considered money services businesses; and
- The concept of “designated persons” was introduced.
These amendments were brought into force with record speed. It is estimated that 1000 entities which were not previously affected are now subject to obligations such as registering with FINTRAC, maintaining compliance programs and reporting suspicious transactions.
Grant stressed, “Entities that are in the rest of the corporate universe should be very aware of the fact that financial regulation is coming much more broadly.”
Class Actions
Anne Merminod, a partner at Borden Ladner Gervais LLP, then touched on class actions coming out of the COVID-19 pandemic and the use of the Emergencies Act now and in the future.
Merminod explained that over 300 class actions have been filed in the United States since March 5, 2020, in direct connection to the pandemic, and 40 class actions have been filed in Canada as of September 3, 2022. This is double the usual number filings of class actions. Notably, half of the filings in Canada are in Quebec due to their more favourable consumer law and class action funding, among other things.
Current class actions by area of law include cancellation and refunds actions, business interruption insurance claims, long-term care home negligence, and public law.
Reports on class actions in the United States in terms of the nature of the claims are similar to what Canada is currently experiencing— cancellation and refunds actions, business interruption insurance claims, long-term care home negligence, and public law—with the addition of price gauging claims and improper screening measures claims. The latter may act as a crystal ball for what is to come in Canada.
Looking forward, new claims may be filed as more losses crystalize, limitation periods for pandemic-related claims approach and novel developments arise. Ongoing COVID-19 class actions will continue to advance towards merits determinations and businesses may face claims related to covid-19 outbreaks on their premises as new variants of the virus circulate.
Merminod urges that “if your company is a target of a class action, and if you want to avoid the costs of a class action—the defense cost or the settlement cost, which is incredibly high, and settlement approvals are long and complicated—you can always decide to launch a reimbursement program or a satisfaction program to buy past the class action."
SCC Cases
The panel wrapped up with Nadia Effendi, a partner at Borden Ladner Gervais LLP, who shared the 2022 Supreme Court of Canada (SCC) cases that in-house council should be aware of.
A notable update at the SCC is the upcoming retirement of Justice Moldaver, the court’s most experienced justice in criminal law, at the end of September. A lot of discussion has taken place around finding a replacement who accurately reflects the Canadian community—what criteria should be used?
Looking forward to the rest of 2022, Effendi highlighted national and provincial cases for which judgement is under reserve, which included those related to intellectual property and copyright, bankruptcy and insolvency, and expropriation—all topics that may impact in-house counsel work. She then shared notable cases where leave has been granted, but an appeal has not yet been heard, including those related to anti-SLAPP (Strategic Lawsuits Against Public Participation) legislation, taxation, commercial law and the duty to inform.
Although it would be useful to have an accurate crystal ball to reveal the future, this session showed how we can use what we know of the past to predict the potential impacts that in-house counsel should consider for the future.
You can watch the entire panel presentation on the conference platform until June 19. If you registered for a conference package, simply log in to the platform. If you would like to register now, visit the conference site for more information.