Question 1

Helena is president and the sole director of a small garment-making company in Markham,Ontario,that specializes in preliminary assembly of garments such as underwear,blouses,jackets,and suits.To cut costs,one way in which many clothing companies are putting together clothes these days is "fusion," a process that involves the use of glue.Helena's company uses fusion techniques and therefore stores a considerable amount of glue on site.Helena wonders what her duties as president and director are with respect to the glue and its storage and use.Her lawyer should advise her that under Ontario law

Accepted Answer

As a president and director, Helena has a duty to take all reasonable care to ensure that her company complies with the law. The standard of what is reasonable will depend on her position and responsibilities within the company. Therefore, she needs to ensure that her company is complying with the law regarding the storage and use of glue, as it may cause harm to employees or the environment. Ignorance or avoiding knowledge of any violations of the law will not absolve her of liability.

Question 2

The Constitution's "trade and commerce" clause

Accepted Answer

The "trade and commerce" clause in the Constitution (specifically section 91(2)) allows the federal government to legislate on matters that have to do with trade and commerce throughout Canada, such as setting national standards for products and services. This power is balanced by provincial powers over property and civil rights, so while the federal government can set national standards, it cannot interfere with how provinces regulate businesses locally.

Question 3

Low-Valu Inc owns and operates a number of discount mega-stores.Because of increasing competition,it has engaged in a number of improper business practices.It was recently accused of a "bait and switch" practice in one of its stores.Which of the following statements is TRUE?

Accepted Answer

Choice E correctly defines the "bait and switch" practice, which involves advertising a product at a low price and then directing customers to a higher priced alternative. The other options are incorrect. Choice A describes a different practice known as "phantom pricing," while Choice B is not entirely accurate as "bait and switch" is not explicitly prohibited under the Sale of Goods Act. Choice C is a historical reference that is not relevant to the current situation, and Choice D is not necessarily true as the alleged practice may not always be considered a criminal matter under the Competition Act.

Question 4

Joe Fortino wants to open a large nightclub on the waterfront in Windsor,Ontario,which he calls The Evil Eye.It is supposed to have a large terraced area for drinks,beach volleyball in the summer,a skating rink in winter,and an indoor stage that will feature the hottest bands around.The club opens and is immediately successful,but two weeks later Joe learns that Windsor City Council has recently passed a by-law prohibiting the operation of clubs on the waterfront.The Council is allegedly concerned about noise,but Joe suspects that some other club owners are jealous of his success and "leaned" on Council to close The Evil Eye down.Joe comes to you,his lawyer,claiming that the by-law is a deprivation of private property under the Canadian Charter of Rights and Freedoms and that its operation impinges on his and the club's "freedom of association." Will Joe prevail?

Accepted Answer

The answer of Joe Fortino wants to open a large...

Question 5

Excise taxes are taxes on

Accepted Answer

Excise taxes are taxes on specific goods or services that are considered non-essential or luxury items, such as cigarettes, alcohol, and gasoline. They are often used to discourage consumption of these items or to raise revenue for the government. Taxing essential goods, such as food, is usually seen as unfair and regressive.

Question 6

One of the key elements of consumer protection under provincial laws is mandatory disclosure of contractual terms.Describe the main features of provincial laws requiring disclosure to consumers.

Accepted Answer

The answer of One of the key elements of consumer...

Question 7

Alpha Corp and Beta Inc recently merged.Prior to the merger,both companies manufactured tools.The merged company continued to do so after the merger.Technically speaking,the parties were involved in a

Accepted Answer

The merged companies continued to manufacture the same products, which indicates a horizontal merger where two firms from the same industry merge to expand their market share or increase efficiency.

Question 8

A business may NOT be able to challenge an action by a regulatory body that adversely affects the business on the basis that

Accepted Answer

A business cannot challenge a regulatory action simply because it is unpopular; challenges must be based on legal grounds such as jurisdiction, due process, or constitutional violations.

Question 9

In some provinces,due diligence is

Accepted Answer

In some provinces, due diligence is both a defence and a duty. This means that corporations have a responsibility to exercise due diligence in order to prevent harm, but if harm still occurs, they may be able to use due diligence as a defence in court.

Question 10

The Ether Store Inc is trying to break into the potentially lucrative world of online retailing.Given the competitive nature of the field,it believes that the key to success is advertising and promotion.It therefore has asked you to review and assess several proposals that it has developed.Which of the following statements is TRUE?

Accepted Answer

Deceptive telemarketing is indeed an offence under the Competition Act. Option A is incorrect because misleading advertising can also be treated as a criminal offence, not just a civilly reviewable matter. Option B is incorrect because the Competition Act prohibits misleading advertising even if no customer is actually misled. Option C is incorrect because the Competition Act does regulate telemarketing, and there are specific rules around it. Option E is incorrect because a due diligence defence can be available in some cases of advertising offences if the company can show that it took reasonable steps to prevent the offence from happening.

Question 11

Copyright includes the right to make copies of some particular form of expression,usually in the form of written work (ie a book or article),musical recording,film,or software program.In Canada,copyright is expressly protected by laws and users must pay royalties for use of a copyrighted work.Because paying for individual use of copyrighted works would in many instances be cumbersome and inefficient,copyright often is entrusted to collective-administration societies in Canada that look after the collection and payment of revenues.Thus,every time you listen to a song on the radio a small tariff is paid by the radio station,which ultimately makes its way back to the artist through the collective administration society.The federal Copyright Board,located in Ottawa,is entrusted with the task of setting the rates to be paid for the use of copyrighted work.??The Society of Composers,Authors and Music Publishers of Canada (SOCAN)is a collective rights administration society.It administers performing rights in musical works on behalf of Canadian composers,authors,and publishers as well as affiliated societies representing foreign composers,authors,and publishers.If it objects to a copyright rate set by the Copyright Board how and where can it seek to have this decision overturned?

Accepted Answer

The answer of Copyright includes the right to make copies...

Question 12

Which of the following statements is TRUE with respect to the relationship between federal and provincial jurisdiction under the Constitution?

Accepted Answer

The doctrine of paramountcy states that when there is a conflict between validly enacted federal and provincial laws, the federal law prevails.

Question 13

There are several types of offences under the Competition Act.Which of the following statements is TRUE?

Accepted Answer

It is true that some decisions of the Competition Tribunal can be appealed to the Federal Court. However, it is not true that every type of offence can lead to an award of damages (A). Reviewable matters can trigger an investigation and also result in relief (C). Dual matters involve the commission of more than one offence by multiple offenders, not necessarily a single offender (D). The Competition Act allows for private actions in certain situations, such as for damages resulting from a criminal offence (E).

Question 14

Government's role in the regulation of business in Canada is limited by key legal principles.Discuss with reference to three principles encountered in Chapter 25.

Accepted Answer

The answer of Government's role in the regulation of business...

Question 15

Nefarious Inc and Jaffar together control 90 percent of the market for artificial hearts.Nefarious and Jaffar have NOT committed an offence under the Competition Act if they

Accepted Answer

This is the only choice where Nefarious and Jaffar are collaborating in a way that does not harm competition or consumers. Collaboration on research for new products can lead to innovation and improved products, which benefits consumers. Choices A, B, C, and D involve agreements that restrict competition or raise prices, which would be violations of the Competition Act.

Question 16

A comfort or no-action letter

Accepted Answer

The answer of A comfort or no-action letter
...

Question 17

The Competition Bureau has long suspected HAL Corp of abuse of dominant position.After a recent investigation,the Bureau commenced proceedings against the company.Which of the following statements is most likely to be TRUE?

Accepted Answer

Selling products below cost to eliminate a competitor is considered an anti-competitive act, which can be used to demonstrate abuse of dominant position.

Question 18

Both the federal and provincial governments have powers over business regulation in Canada.Explain how conflicts between these powers are resolved and which level of government takes precedence.

Accepted Answer

The answer of Both the federal and provincial governments have...

Question 19

Lucinda is the sole shareholder and president of NailCo,a corporation that owns a chain of manicure and pedicure salons in the lower mainland of British Columbia.She visits most of NailCo's outlets weekly.She comes to you,her lawyer,to confess that over the past few months she has witnessed several of NailCo's employees dump nail polish down the drain on a number of occasions.Lucinda is now concerned that she and NailCo may be liable for the environmental consequences of these actions even though she personally did nothing.You would most likely advise Lucinda that

Accepted Answer

As the sole shareholder and president of NailCo, Lucinda is considered a directing mind and will of the corporation, and therefore can be held liable for the environmental damage caused by employees in the course of their duties. The corporation may also be held liable, but it could have a due diligence defence if Lucinda took reasonable steps to avoid the offence. It is important for Lucinda to comply with provincial legislation in the future and take measures to prevent any further environmental damage caused by her employees. Suing her employees or doing nothing are not viable options in this situation.

Question 20

Tesco Inc is a large British supermarket chain that is considering entering the Canadian grocery market.The industry is characterized by high-quality service,entrenched competitors,and razor-thin profit margins.Tesco knows that in order to successfully compete it will have to offer a level of service superior to that of existing grocery retailers.It will also have to differentiate its services to a considerable degree in order to distinguish the company in the Canadian consumers' mind.From previous experience in other markets Tesco knows that it will have a maximum of two years to begin making a profit.Otherwise,its investment will be lost.Tesco management notices that Sunday closing legislation is still in effect in the Maritime provinces and,by opening a flagship store in Halifax,wonders whether it can use the Canadian Charter of Rights and Freedoms to contest this measure,perhaps gain publicity,and have an extra day to make money each week.A successful challenge could be the difference between profit and loss.It plans to argue that Sunday closing is discriminatory to its non-Christian workers,many of whom would prefer to work on Sundays and have other days off for rest and worship.Discuss the chances of its success.

Accepted Answer

The answer of Tesco Inc is a large British supermarket...

Quiz 25: Government Regulation of Business