Newfoundland and Labrador suffered back-to-back legal setbacks in its long-running energy feud with Hydro-Québec after Quebec courts held that the provincially-owned utility was under no obligation to renegotiate a controversial 1969 agreement and that it was entitled to purchase all but a fraction of the power generated by Churchill Falls power plant. (more…)
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Hydro-Québec wins back-to-back legal skirmishes in longstanding energy dispute over Churchill Falls
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Walmart fined for pricing violations
Walmart Canada was fined more than $27,000 after it plead guilty to 11 counts of violating provincial consumer protection laws, announced the Quebec Consumer Protection Office. (more…)
Categories: QuebecTags: consumer protection -
Court certifies class action regarding misclassification of lawyers as independent contractors
In a decision that underlines the changing employment landscape, a class action against Deloitte LLP involving document reviewers has been certified by an Ontario court. -
Not a single client satisfied
The disconnect between clients and large law firms is so significant and persistent that a growing number of clients are considering bringing more legal business in-house, exploring alternative legal service providers and are contemplating doing business with smaller firms that offer greater flexibility, reveals a report.
General counsel feel that large law firms make little effort to understand their business, do not appreciate the budgetary constraints they face, and receive little help when analyzing the complex portfolio of legal work given to them. Indeed, the report points out that not a single client was satisfied with what law firms provide.
“Earlier research commissioned by LexisNexis looked at barriers that inhibit change in the industry and a theme that consistently emerged was a disconnect in how law firms listen and act on the voice of the client,” said the report which was conducted by information provider LexisNexis and Cambridge University’s Judge Business School. “That this voice is not always heard, or can become distorted during interactions is both puzzling and potentially ominous, given how critical client relationships are for law firms.”
Part of the problem is that while both law firms and clients are aware of the disconnect, their interpretations of the magnitude and underlying causes are far from the same. Echoing findings by a 2016 global research study by Deloitte, the LexisNexis study noted that clients want solutions to their problems, and large law firms are not providing them. In fact 40 per cent of clients noted that senior partners of their law firms appear to lack more than a basic knowledge of their business. Several general counsel even went so far as to describe their interactions with partners as superficial, with partners often poorly briefed.
Clients want relationships, and do not view transactions as the essence of the relationship. Rather, clients look for law firms to “connect the dots, convey the bigger picture, suggest ways in which the law firm can create value for the client’s business and not just reduce costs,” noted the report.Law firms don’t see it that way. They tend to focus on the transaction, not relationship-building, and many law firms see no need to foster relationships. Law firms provide advice, and it’s up to the clients to translate this advice to solutions, as one partner put it.
It’s also no secret that the majority of in-house counsel are under intense pressure to shave costs and run a lean team. But general counsel complain that law firms do not seem to recognize that reality, and are in fact “underwhelmed” by their response. In-house counsel assert that law firms have “little appetite” to offer alternative business models. And when law firms do offer services at fixed fees, “clients see the parameters of the service changed so frequently the fee is actually variable,” noted the report entitled “Applying the voice of the client in law firms.” Further 75 per cent of clients stated that they get little help from large law firms when “analysing complex portfolio of legal work” given to them, be it spends, trends, type of work, the life cycles of cases and impact.
Unsatisfied clients are taking matters in their own hands, and are ending relationships with law firms more frequently than ever before, added the report. Twenty per cent of clients stated that they change “membership of their panels of law firms” more often that they wish. Moreover, 25 per cent of clients are considering moving more business in-house while others have begun working with much smaller law firms who offer the flexibility, visibility and responsiveness that they do not get from large law firms.
“The pace of evolution in the legal profession is unprecedented and although many of these changes are client-driven, it seems based on this research that the client voice is still not being heard loudly enough within the firm,” said Mark Smith, market development director at LexisNexis. “It suggests that law firms need to improve their ability to work in a joined up manner, focus on identifying opportunities that create mutual value, and start working harder at putting client relationships at the heart of everything they do.”
Law firms still have time to do something about the disconnect, suggests the report. To begin with, law firms should consider re-engineering processes and practices. Law firms should appoint key account representatives to help ensure close co-ordination between different teams because far too often law firms are uncoordinated in how they execute a portfolio of transactions with a client. They should also take their cues from the likes of consulting firms who provide “dashboards of the status of completed and ongoing activities,” with billing and associated information.It would also be in the best interests of law firms to spend more time building relationships with their clients and partners should better coordinate these efforts.
Law firms need to rethink core client strategies, suggests Kishore Sengupta of Cambridge Judge Business School. “To succeed in the current climate, lawyers need to be more than just great lawyers. They need to understand their clients’ businesses more deeply. Lawyers now need to implement clear strategies to manage client relationships, moving beyond pragmatic engagements to providing a sense of partnership where the client feels valued and protected.”
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Class action against Bell certified
Joey Zukran is a busy man. The Montreal lawyer who spearheaded a class action over photo radar tickets following a series of decisions that have put thousands of tickets in jeopardy after the courts called into question the rules around the province’s use of the automated speed and red-light enforcement technology is at again.
This time, he has Bell Canada in his sights. Zukran has launched a class action on behalf of Montreal resident Shay Abicidan that alleges that the largest telecommunications firm in the country is misleading customers that its high-speed internet service delivers a fibre optic network to homes.
The class action, certified yesterday by Quebec Superior Court Daniel Bisson, alleges that the company has falsely advertised its Fibe television and Internet service. An Internet-based television service, Bell Fibe uses a fibre optic internet network to connect to homes. In many cases however the fibre optic wiring is sent to a neighborhood node which in turn is connected to residential homes through copper phone wires. The class alleges that Bell is misrepresenting its adverstisements, in violation of article 41 of the Quebec Consumer Protection Act.
Compensatory and punitive damages in amounts have yet to be determined.
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Federal budget will change how lawyers recognize income
It’s not only smokers and drinkers who have been targeted by the federal budget. Sin taxes are to be expected, and are par for the course.
But professionals such as lawyers, doctors and accountants have been taken aback by the proposal in the federal budget to eliminate their ability to exclude the value of work in progress in computing their income for tax years that begin or after Budget Day.
Taxpayers are generally required to include the value of work in progress in computing their income for tax purposes. But some professionals used to have the option to exclude the value of work in progress in computing their income. That allowed them to defer recognition of income (compared to full accrual) while being able to deduct the related expenses in the year they are incurred.
The budget does however provide some transitional relief, notes Lawson Lundell LLP. For the first tax year after budget day, 50 per cent of the lesser of cost and fair market value of the work in progress will be taken into account for the purposes of determining inventory for tax purposes. After that tax year, the full amount of the lower of cost and fair market value will have to be accounted for.
But as a McCarthy Tétrault bulletin points out, the federal government is concerned that this “billed-basis accounting enables these taxpayers to defer tax by permitting the costs associated with work in progress to “be expensed without the matching inclusion of the associated revenues.”
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Quebec law society leaves lawyers on their own to face disruptive technologies
The combination of market forces, increasingly stringent consumer demands and rapid technological developments means that it has never been more important for lawyers to invest and incorporate technology into their practice, asserts a report by the Quebec legal society that calls on members to shift away from hourly billing to alternative pricing arrangements.Tags: LegalTech -
Montreal AI chatbot helps people immigrate to Quebec
Days after U.S. President Donald J. Trump issued a controversial executive order that barred refugees and temporarily suspended immigration from several predominantly Muslim countries, Amir Moravej and his team decided to lend a helping hand and launched an artificial intelligence immigration chatbot months ahead of schedule.
The sweeping executive order, since rescinded by the courts, led to global chaos as it barred many passengers from flights to the United States, including one of Moravej’s team members. “He had an interview scheduled but couldn’t go to the U.S.,” explained Moravej. “And there were other students who planned to continue their studies in the U.S. but because of the policy changes had to stay here. So we decided to accelerate the launch to help students who are currently in Quebec to get their permanent residency.”
The AI-driven chatbot uses machine learning to assist people through the complicated process of putting together an immigration application. Immigration into Canada and Quebec (which has different programs in place) is a laborious three-step process. Applicants must determine if they are eligible, then must provide supporting documents, and finally fill out an application form, which in itself can be tricky.
That’s where the web-based application at Botler.ai can come into play. It automatizes much of the process. After an applicant answers questions about their qualifications and circumstances, Botler assesses if they are eligible for the immigration program. If so, the applicant can then upload the documents which the AI tool reads and reviews. If all goes well, Botler automatically fills out the application form based on the information the applicant has provided.Botler does more. If for whatever reason the applicant does not meet the immigration eligibility requirements, the AI tool can provide the applicant with “feedback and insights” and steps the candidate can take to take to become eligible, noted Moravej. And it learns and becomes “smarter” as it goes along because it uses deep learning, particularly for document reviews. The machine learns through recognized patterns based on the data it previously “saw,” explained Moravej. That is particularly useful as Botler has the potential of recognizing forged documents.
“There are two things the machine can learn,” explained the Iranian-born developer. “First of all, it learns the profile of the user such as his experience and his educational background – all these things the machine can understand. And the machine can understand the rules of immigration and can determine if you are eligible or not. All these things are basically a decision-making process, and computers are very good at making decisions because they can calculate way more possibilities than us as humans. And it will get smarter as it sees more immigration cases.”
Moravej, who developed Botler out of personal necessity, maintains that the chatbot will not replace lawyers. Indeed, Nonimo A&A Technologies, the nascent firm behind Botler, are working with Montreal law firm Campbell Cohen. Nonimo trains the machine, and the lawyers test it to ensure that Botler covers all cases and captures all of the exceptions.“Botler can augment what lawyers are doing and make their lives easier as it automates many things that lawyers are doing manually right now,” Moravej told me. “As a result, lawyers can process and can represent more clients because many of the tasks that they have to do manually can be automated using Botler. At the end of the day, a lawyer needs to represent a client before the government so Botler can in no sense replace a lawyer.”
At present, Botler can handle only a single immigration program – the Programme de l’expérience québécoise (PEQ) for foreign workers and students residing in Quebec. As of the beginning of April, 1,752 applicants used Botler to assess their eligibility, and Moravej said that 438 applicants will either be eligible or will become eligible to apply for PEQ, if they can resolve minor issues with their cases. In the near future, Moravej intends to adapt the technology to encompass other federal and provincial immigration programs.
Across the Atlantic, a Stanford University student in Oxford, England Joshua Browder has embarked on a similar venture. The London-born developer and creator of DoNotPay, a chatbot that has overturned 160,000 parking fines in England, recently turned his sights on helping refugees claim asylum. The chatbot, which uses Facebook Messenger, helps refugees fill in immigration applications in the U.S. and Canada, and it helps those in the United Kingdom apply for asylum support. Like Botler, the chatbot asks applicants a series of questions to determine which application the refugee needs to fill out and assesses whether the refugee is eligible for asylum protection under international law.
Both Moravej’s and Browder’s chatbot are the latest examples of online AI-powered tools that can expedite access to justice, an issue that has befuddled the legal profession for decades. “These tools that are now coming online are such a great opportunity to unlock access to justice, which is such a prevalent need in our society,” said Matthew Peters, national innovation leader at McCarthy Tétrault LLP in Toronto. “You have this whole huge swath of people in the middle class and all sides who quite frankly have (been the subjects of) a disservice from our profession who have not provided proper access to justice. We should be focusing on how fast can we get some of these solutions out.”
Jin Ho Verdonschot, a justice technology architect at HiiL Innovating Justice too believes that AI holds much promise at providing greater opportunities for access to justice. “Artificial intelligence is a very good example of one of the many innovations now happening in the legal services world,” Verdonschot said at a conference held in Montreal last fall. “There are so many tools that (that are) emerging and being developed that will have real value and can really empower our citizens. And I think AI will have a place in that future.”
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Crown blamed after judge stays murder case
The last time it happened a Superior Court Justice apologized.
“I am very sorry that the system has let you down,” said Ontario Superior Court Justice Julianne Parfett last November to the mother of the deceased after she threw out a first-degree murder case against former Canadian Forces soldier Adam Picard because of excessive delays. Picard was charged for the June 2012 killing of Fouad Nayel, a 28-year old construction worker who had been missing for five months. Picard was arrested less than a month after Nayel’s badly decomposed body was found in the woods.
In a bleak and withering assessment of the criminal justice system, Justice Parfett said that the justice system also failed “this accused and the public,” and placed the blame squarely on the shoulders of Crown prosecutors for the unreasonable delays that hampered the case.
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A third of large law firms hacked
Large law firms, though commonly perceived to have stringent cybersecurity procedures in place due to large in-house Information Technology staff and devoted legal IT budgets, are in fact more vulnerable to cyber-attacks than smaller ones, with one in three the target of a cyber-attack over the past year, according to a legal benchmarking report on law firms from the United Kingdom.
The report by NatWest reveals that 24 per cent of all U.K. law firms suffered a cyber-attack over the past year, 16 per cent of whom were small firms (generating fees of less than $3.75 million), 31 per cent large ones (generating fees between $3.75 million and $8.3 million), and 28 per cent very large firms (generating over $8.3 million in fees).
“The fact that a quarter of law firms have been hit by a cyber-attack or fraud over the last 12 months is bad,” noted Steven Malone, Director of Security Management at Mimecast, an IT consultant. “But what is worse is that this is only half the story. Our research reveals that 20 per cent of UK organizations have experienced impersonation attacks (which involve hackers assuming the identity of executives) from their legal departments last year.”
These findings somewhat echo those yielded by the American Bar Association’s latest Legal Technology Survey Report. It found that 26 per cent of firms with 500 or more lawyers reported security breaches in the past year, followed by 25 per cent of law firms with 10-49 lawyers, 20 per cent of law firms with 100-499 lawyers, and 11 per cent of law firms with two-to-nine employees. Solos are the least likely to experience security breaches, with only eight per cent reporting that they have been breached.
The NatWest report does not put a dollar figure to the losses incurred by law firms following a security breach, but it suggests that some of the law firms incurred financial losses and potentially reputational damage. “There is huge pressure on firms to be ever more diligent and to ensure that they have a disaster recovery plan in place,” said the report.
The Solicitor’s Regulation Authority (SRA), which regulates solicitors in England and Wales, revealed recently that approximately $11.5 million of client’s money were siphoned last year thanks to cyber-attacks on law firms. The majority, three-quarters, of cybercrimes reported to the SRA involved some form of “Friday afternoon” fraud where criminals modified emails directly, usually by hacking into the email system of a lawyer. Criminals aim to alter bank details in order to redirect completion funds to the criminal rather than the client. Such scams usually take place on Fridays because that is the time when completions take place, and it buys the fraudster some time before the crime is detected.
Law firms, as custodians of confidential information, are also increasingly becoming targets by those looking for competitive intelligence, according to experts. The case of three men charged with insider trading based on information they hacked from prominent US law firms “should serve as a wake-up call for law firms around the world”, said Preet Bharara, the former US Attorney for the Southern District of New York. “You are and will be targets of cyber hacking because you have information valuable to would-be criminals.”
Part of the problem is that law firms are not laying the basic groundwork to prevent security breaches, according to consulting firm ALM Intelligence. There are three fundamental stages of data security – assessment, planning and testing. That involves understanding data security needs and risk-profiling data accordingly, then implementing solutions on needs and profile, and finally – and critically — testing to ensure an effective response in case of breach. While 77 per cent of law firms have conducted a formal security assessment and 66 per cent have a data breach plan in place, a scant 46 per cent have tested their cybersecurity plans.
“Many firms’ confidence in their own cyberattack preparedness seems misguided,” said Daniella Isaacson, co-author of the report. “Our research indicates that most remain surprisingly unprepared for the threat. Many, for example, never test their cybersecurity protocols. This means that on the day of a breach, those firms are using an unproven response plan.”
But pressure from clients to deal with cybersecurity is mounting. Some 70% of law firms surveyed by ALM Intelligence said they are under pressure from their clients to beef up internal data security. If law firms shrug off pressure from clients, it will be much more difficult to ignore impending changes to Canada’s privacy legislation.
The Digital Privacy Act, which amends the Personal Information Protection and Electronic Documents Act (PIPEDA), came into force in June 2015. But regulations regarding breach reporting, notification, and record keeping have yet to come into force. They are however expected to come into force sometime this year, said Imran Ahmad, who heads the cybersecurity law practice at Miller Thomson LLP.
The impending changes will require custodians of data, including law firms, to report information security breaches where an organization “reasonably believes” that a breach of its security measures” creates a real risk of “significant harm” to an individual, said Ahmad. This assessment hinges on the sensitivity of the personal information that was compromised, the probability that the personal has been, is being or will be used as well as “any other prescribed factor,” added Ahmad.
Organizations such as law firms should therefore conduct a review of their existing protocols and policies to ensure that they have the ability to detect, respond and report data breach incidents. And they should also assess the types of information they hold, be it personal information, intellectual property or supplier data.
“Organizations should take steps to ensure compliance and make sure to document them appropriately,” said Ahmad.
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Nearly $8.8 million in monetary sanctions imposed in 2016 for Quebec securities offenses
When Judge Réna Émond of the Court of Québec imposed just before the Christmas holidays fines totaling $120,000 on Danny Gagné and ISpeedzone Inc. for illegal practice as a securities dealer, it wrapped up a good year for Quebec’s financial watchdog.Nearly $8.8 million in fines and administrative penalties were imposed on 158 individuals and firms in 2016 for various offences under laws administered by the Autorité des marchés financiers (AMF), according to the latest enforcement report by the regulator. Of the $8.8 million in total monetary sanctions, $7.6 million involved securities or derivatives laws violations, with another $1 million stemming from Quebec’s Distribution Act. The report reveals that 15 offenders did more than 11,000 hours of compensatory work, with one offender choosing to pay his fines through a prison sentence of 729 days.
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Jordan applications keep on rising
The numbers seem to be growing by the day. Ever since the Supreme Court of Canada issued its landmark Jordan ruling on July 2016, the pressure on the justice system seems to be growing. Not a day seems to go by without some horror story about some criminal being let off because of the new deadlines set by the nation’s highest court.Last July in R. v. Jordan 2016 SCC 27, the SCC criticized the country’s legal system for its “culture of complacency” and the ruling set out new rules for an accused’s right to be tried within a reasonable time frame. The Jordan decision laid down a ceiling of 30 months for matters before Superior Court cases to be completed. Provincial court trials should be completed within 18 months of charges being laid, but can be extended to 30 months if there is a preliminary inquiry.
The Quebec criminal justice is struggling to comply with the new rules, implicitly acknowledged the Quebec Minister of Justice Stéphanie Vallée when she announced the new investments last December.
Now there are hard figures to back up those concerns. The Quebec Director of criminal and penal prosecutions (DPCP) revealed recently that there are 684 Jordan applications as of March 23, 2017, a figure that has tripled in the space of three months. In November 2016, the number of Jordan applications stood at 222. A month later, just before Christmas, they numbered 368.
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Quebec Bar pleased with federal budget, disappointed by provincial budget
A week after Quebec’s legal society commended the federal government’s 2017 budget for investing new monies and resources in the justice system, the Barreau du Québec deplored the “lack of vision” shown by the provincial government in its budget. -
Transports Quebec ordered to pay $1.6 million to subcontractor
The Quebec Ministry of Transport was ordered to pay a subcontractor $1.6 million for roadwork even though it had shown signs of premature wear and tear after the Quebec Court of Appeal held that the subcontractor did not face a warranty of durability.In a ruling that provides guidance over contractual notions such as obligation of result, performance of work and warranty of durability, the Quebec appeal court reaffirms a contractor’s positive obligation to provide information to third parties, according to experts in contract and construction law.
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Quebec hires more judges and Crown prosecutors to curb delays
Arrested Under growing pressure to mitigate a growing backlog of cases in the criminal justice system, the Quebec government announced last December that it was going to pour $175.2 million over the next four years to recruit new judges, prosecutors and support staff to help curb mounting court delays.
Tags: criminal justice system
