The Law Blog http://www.tdslaw.com/blogs Legal Blogs by Thompson Dorfman Sweatman LLP Mon, 14 May 2012 23:45:38 +0000 en hourly 1 http://wordpress.org/?v=3.0 Guide to Financial Assistance Programs For Manitoba Businesses http://www.tdslaw.com/blogs/jan-lederman/uncategorized/guide-to-financial-assistance-programs-for-manitoba-businesses/ http://www.tdslaw.com/blogs/jan-lederman/uncategorized/guide-to-financial-assistance-programs-for-manitoba-businesses/#comments Mon, 14 May 2012 23:45:38 +0000 Jan Lederman http://www.tdslaw.com/blogs/jan-lederman/?p=338 An updated version of the Guide to Financial Assistance Programs for Manitoba Businesses has now been posted. In addition to updating funding programs like Manitoba’s Commercialization Support for Business (CSB) program, the new version of the Guide also includes NSERC Industry Partnersip Programs. You can find the Guide  at http://www.tdslaw.com/media/files/financialservicesguide.pdf.

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New Legislation to Protect Cell Phone Users http://www.tdslaw.com/blogs/business/new-legislation-to-protect-cell-phone-users/ http://www.tdslaw.com/blogs/business/new-legislation-to-protect-cell-phone-users/#comments Thu, 10 May 2012 13:17:57 +0000 Peter Sim http://www.tdslaw.com/blogs/?p=178 Amendments to The Consumer Protection Act of Manitoba which require full disclosure of all fees and charges and place limits on cancellation fees and other charges will come into effect on September 15, 2012.

The Act applies to all cell phone contracts entered into by individuals primarily for personal, family or household use. It covers all contracts entered into after the effective date as well as extensions or renewals of existing contracts after the effective date.  Prepaid contracts are excluded.

All cell phone contracts and all advertisements for cell phone contracts must clearly state the minimum monthly cost of the contract.  The minimum monthly cost is defined as the minimum amount the customer will be required to pay under the contract, except for taxes, regardless of the customer’s usage of services.  Temporary discounts are not to be deducted when calculating the minimum monthly cost.

All cellphone contracts must be in writing and must include the information specified in the Act and regulations. This information includes a list of items included in the minimum monthly cost, the services covered by the minimum monthly costs, the rates of additional services and the procedure for cancelling the contract.

Customers have the right to cancel a cell phone contract at any time on notice to the supplier.  The Act sets the maximum cancellation fee which a supplier may charge. If the contract is for an indeterminate term, and the supplier did not provide a cell phone free or at a reduced cost, the supplier may not charge any cancellation fee.

Unilateral amendments to material terms of the contract, which include the minimum charge and services provided, are prohibited.  Suppliers may make unilateral amendments to non-material terms of the contract on notice to the customer, but the customer will then have the right to cancel the contract without penalty

Provisions of contracts which violate the Act are unenforceable and the Consumer Protection Office may issue penalties of non-compliance of up to $1,000 for the first offence, $3,000 for the second offence and $5,000 for all subsequent offences.

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Effective Use of Letters of Intent http://www.tdslaw.com/blogs/business/effective-use-of-letters-of-intent/ http://www.tdslaw.com/blogs/business/effective-use-of-letters-of-intent/#comments Fri, 27 Apr 2012 14:49:27 +0000 Elmer Gomes http://www.tdslaw.com/blogs/?p=175 A Letter of Intent (“LOI”) is quite often the first document between business people to record their understanding of the main commercial terms for a potential transaction. One of the benefits of an LOI is that it minimizes the chances of a transaction not proceeding because of a failure or misunderstanding to have a meeting of the minds on some of the basic commercial terms.  This avoids wasting time, wasting resources and the costs associated with both before the parties get too far along.

Very often, a LOI is established with the expectation that the terms, or at least some of them, will be “non-binding”. However, caution should be had when entering into any type of LOI and make it explicit which terms are and are not binding and proceed in the manner that does not give rise to the impression that both parties believe an agreement to have been consummated. A few years ago, the Ontario Court of Appeal found that parties to a prospective transaction were bound by the terms of their initial document despite not having signed a formal commercial agreement (in this case a share purchase agreement). The Court found that the language in the “LOI” contained terms that suggested a meeting of the minds and the conduct of the parties  to signing the “LOI” was sufficient to conclude that the parties had an intention to be bound by an agreement they had not yet signed.

As a result, in preparing a LOI, it is very important to ensure that the “non-binding” and the “binding” provisions are clearly specified. While items such as the structure, price, and necessity to enter into more definitive agreements are typically ones which you would expect would be “non-binding”, one can expect that such matters such as confidentiality, exclusivity during the period of inspection, access to due diligence materials will be requested to be “binding”.  In addition, caution should be had to the use of terms which suggest an agreement which is not intended (for example, terms like  “agreed”, “agreement”, and “upon acceptance”)

It’s important to also manage the conduct of how certain parties behave throughout the process once a LOI is signed and in the course of negotiating more definitive agreements. For example, in connection with a purchase of a business, what type of disclosure has there been made to learn and operate the business? Has there been any communication with the employees of the business and if so, what message has been sent.

A LOI is a valuable document when business owners are in the “honeymoon phase” at the outset of their relationship to establish as many of the key terms as possible in connection with the prospective transaction. It sets the tone of negotiation for the future and the process to be undertaken in an orderly manner; but caution should be had to ensure the provisions of the LOI are specific as to what is binding and what is not binding and the conduct of the parties subsequent to the signing of the LOI is managed to avoid any argument that the parties had an intention to be bound despite not signing formal or definitive agreement.

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Manitoba to Review Groundwater Legislation http://www.tdslaw.com/blogs/environmental-and-sustainable-development/manitoba-to-review-groundwater-legislation/ http://www.tdslaw.com/blogs/environmental-and-sustainable-development/manitoba-to-review-groundwater-legislation/#comments Mon, 16 Apr 2012 19:59:51 +0000 John Stefaniuk http://www.tdslaw.com/blogs/?p=171 In a March 22, 2012 press release, Gord Mackintosh, Manitoba’s Minister of Conservation and Water Stewardship, announced that his department is undertaking a review of Manitoba’s groundwater legislation.  A discussion paper and additional information is available at the department’s website at:   www.manitoba.ca/waterstewardship/groundwater

There are some 35,000 active water wells in Manitoba,  with 1500 new wells being drilled every year, many for geothermal heating. The current legislation, The Groundwater and Water Well Act, and accompanying regulations (enacted in 1963 and 1969, respectively) are viewed as being both outdated and inadequate in dealing with the challenges of protecting groundwater quality.  Manitoba Conservation and Water Stewardship sees a need to strengthen measures to protect aquifers and to update the regulatory structure to include geothermal, geotechnical and monitoring wells.

The five main areas identified for amendments are:

  • licensing and certification;
  • management and protection of groundwater, including aquifer management planning;
  • well drilling, construction and sealing standards;
  • groundwater and well database management; and
  • compliance and enforcement.

Licensing requirements would extend to individual well drilling technicians as well as well drilling companies, which are currently licensed.  The discussion document proposes the development and administration of  licensing and certification programs with  requirements for minimum levels of competence for well drilling professionals.

A reporting obligation is proposed to be introduced in circumstances where contamination occurs during the drilling or sealing of a well.  A classification system will be developed to allow the categorization of wells and aquifers as being contaminated or saline and therefore subject to different controls.  A permit will be required to construct or seal an injection well for disposal of saline or wastewater.  Regulations will be developed to allow for the designation of sensitive groundwater areas and require the protection of wells in designated flood areas in order to prevent contamination by surface runoff during flooding.

Current regulations do not provide for geothermal, geotechnical or monitoring wells.  Proposed legislation would enable the establishment of regulations that would apply to closed loop geothermal systems and geotechnical drilling.  The regulations would also extend to the sealing, drilling, construction and protection of those wells and the control of flows from artesian wells.  The legislation would also allow for issuing a declaration that wells are abandoned and/or contaminated.

Regulations related to the reporting of drilled water wells are proposed to  be extended to require the reporting in relation to geothermal and geotechnical wells. Regulations applicable to the sealing of wells will be improved.

Compliance and enforcement measures are proposed to permit:

  • well construction and sealing orders;
  • a process for the appeal of orders to the Minister;
  • rights of entry and inspection for the department;
  • significant increases to penalties for non-compliance; and
  • public reporting of violations.

Manitoba Conservation and Water Stewardship is accepting comments on the proposed amendments until Friday, April 20, 2012.

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The Limited Partnership Agreement http://www.tdslaw.com/blogs/business/the-limited-partnership-agreement/ http://www.tdslaw.com/blogs/business/the-limited-partnership-agreement/#comments Thu, 05 Apr 2012 19:23:33 +0000 Drew Mitchell http://www.tdslaw.com/blogs/?p=168 A limited partnership agreement is an agreement between all of the partners of a limited partnership (both the general partner and the limited partners) which, among other things, provides for the management and direction of the business of the limited partnership.  Typical provisions in a limited partnership agreement would include, but would not be limited to, the following:

  1. setting out the name and business of the limited partnership;
  2. imposing restrictions on the transfer of limited partnership units or interests;
  3. imposing restrictions on the issuance of limited partnership units or interests (including for the admission of new limited partners);
  4. setting out the types of partnership decisions that require “special” or unanimous approval of limited partners;
  5. setting the term of the limited partnership;
  6. setting out a mechanism to deal with problems between partners, including the removal and replacement of the general partner; and
  7. imposing requirements on the general partner to ensure that all required declarations and forms are filed with the Manitoba Companies Office to maintain the limited partnership and to keep the capital contribution of each limited partner up to date.

A limited partnership in Manitoba is a creature of statute.  Accordingly, even if individuals or companies have entered into a limited partnership agreement, limited partners are not entitled to limited liability protection afforded by The Partnership Act (Manitoba) until a declaration is filed in the Manitoba Companies Office pursuant to The Partnership Act (Manitoba) and The Business Names Registration Act (Manitoba) (i.e. the entering into of a limited partnership agreement is not sufficient to create a limited partnership under Manitoba law).  In addition, as set out in point 7 above, for the protection of the limited partners, it is important that the limited partnership filings are kept current, as changes to the limited partners (including changes to capital contributions) have no effect until appropriate filings are made.

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