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The relationship between employer and employee takes the form of a verbal or written
contract.
Employment contracts are considered under two broad areas of study:
Individual contract: terms of which are negotiated and agreed to between an
employee and an employer. The conditions in this agreement only apply
specifically to this relationship.
Collective agreement: contract between employer and a group of employees (a
union). Several members of the group form a negotiating team and meet with the
employers representatives to negotiate terms and conditions.
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Form:
No form is required for a contract of employment.
The law leaves it entirely to the parties to determine what form they want their
contract to take.
Employer/Employee Obligations and Rights:
Employers main obligation = allow employee to carry out the work, to pay
wage/salary and to ensure that the work can be done safely.
Employers right = insist that work is done in a particular way and having
employees follow a certain pattern of behaviour and if the employee does not
conform to these rules, the employer has the right to discipline the employee.
Disciplinary measures begin with a verbal and then a written warning. Penalties
can include suspension, transfer of position, demotion and the ultimate penalty is
to fire (terminate) the employee.
Grounds for instant dismissal (being dismissed for a cause): starting a fire,
smoking where it is dangerous, damaging employers equipment, stealing from
employer, falling asleep, fighting with other employees, staying away from work
without notification, etc.
Employees obligation = work carefully, promptly and to the best of their ability, to
be honest, loyal and not divulge confidential information (unless it is a question of
public security and safety).
Restrictive Covenants and Non-Competition Clauses:
Businesses require employees to sign a clause restricting their rights to use or
reveal confidential information, even after leaving the service of the employer.
Restrictive Covenants and Non-Competition Clauses refer to clauses that contain
restrictions such as not allowing an employee to work for another company in the
same industry or start a new company after leaving for a fixed period of time.
If an employer has fired the employee with short notice or forced them to quit, the
Civil Code prohibits the employer from invoking this clause.
Renewal and Termination:
Tacit renewal: if there is no objection from the employer and the employee
continues to work for five days after the original contract expires, it is
automatically renewed with the same conditions except it is now with an
indeterminate term. To cancel now, one party must give notice to the other.
According to the Civil Code there is no specific time period to cancel a contract, it
only states that it must be given in reasonable time.
Under the Labour Standards Act (Quebec law), there are minimum periods of
notice based on length of service.
Certificate of Employment states the length of the term of employment and the
kind of work done but no mention of information about the employees
performance. It is issued when a contract of employment is terminated.
Contractors:
Subordination: an essential element of the employer/employee relationship.
Contractor refers to someone who undertakes to do a job for someone.
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8.2 Contracts
Definition:
Contracts are the most common source of legal obligations in business.
Obligations are the consequences of the agreement or contract between two or more
parties.
A contract is a bilateral agreement since obligations operate in both directions and both
parties agree to commit themselves to certain acts.
Because the legal obligations are enforceable by the courts, a contract can be
considered as creating a law between the parties.
Classification of Contracts:
Some contracts need very little negotiation and some obligate one party without any
return from the other party.
Types of contracts:
Contracts of adhesion: the conditions are drawn up by only one of the parties and
the only choice available to the other party is to accept or reject the conditions,
enter the contract or not enter it (airline tickets, transportation contracts).
Contracts by mutual agreement: both parties discuss and agree on all of the
conditions of the contract.
Synallagmatic or bilateral contracts: both parties have agreed to perform an
obligation (A pays $10 to B and B gives A a book).
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If the offeror is in London and speaking over the phone with the offeree in
Montreal, the contract is formed in London. If the offeree sends acceptance by
fax to the offeror in London, the contract is formed in London.
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Nature of Nullity:
Contracts entered into which do not meet the conditions of formations previously
mentioned risk being nullified and deemed to have never existed.
Two degrees of nullity exist:
Absolute Nullity: a contract which puts at risk protections of the general
public interest is considered absolutely null.
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Interpretation of Contracts:
Articles in the Civil Code set out the principles of interpretation of contracts to assist
business people and the courts understand and interpret contracts.
Court should try and uncover the real intention or purpose for entering the
contract.
Examine the historical nature of the relation between the two parties involved.
Clauses in the contract must be interpreted in line with the other clauses in the
contract.
An existing clause should have an effect rather than no effect.
Words with multiple meaning used must be given a meaning.
In the case of doubt, the court will favour the party that agreed to the obligations
rather than the party that imposed them.
Incidental (non-expressed) associated obligations must be recognized by the
courts.
An external clause, cited in a contract, binds all parties except when it is a
consumer contract or contract adhesion in which the consumer or adhering party
could not have known and was not informed of its existence.
An illegible or incomprehensible clause in a consumer or adhesion contract is
null and has no effect unless adequately explained.
An abusive clause is automatically null.
A clause that is nullified does not render the whole contract invalid if it is possible
for the contract to exist without this clause.
Performance of Contracts:
Failure to fulfill obligations of a contract without justification gives the creditor, under the
Civil Code, the right to:
Force performance through injunction or by having the obligation performed at
the expense of the debtor.
Have the contract annulled by resolution (both parties must restore to each other,
contract is then deemed never to have existed), or cancelled by resiliation
(contract ceases to exist for the future with no restoration of prestations).
Reduce the scope of his share of related obligations.
Refused to perform his share of the obligations.
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Hold on to the debtors property until is paid for work related to the property.
Injunction: a creditor institutes an action seeking a court order instructing a debtor to
cease doing, not do, or to perform a particular act. A permanent injunction is granted as
part of the final trial judgement.
Interlocutory Injunction: possible only after an action has been instituted. A temporary
injunction may be granted for the duration of the proceedings until a trial judgement is
rendered, if the plaintiff can demonstrate; interest and seriousness of the issue, that it is
necessary to avoid irreparable injury before final judgement, that on the balance of
convenience he will suffer significantly more than the defendant.
Provisional Injunction: in case of urgency, the plaintiff can request that an injunction be
issued before the defendant has received notice of an interlocutory hearing. This
injunction can last no more than 10 days.
Default of Contract:
Prior to taking any action against the debtor, the Civil Code requires the debtor to be
placed in default:
By the contract itself, when the debtor fails to perform an obligation by a
stipulated deadline.
By extrajudicial demand, by which the creditor sends the debtor a letter
requesting performance within a certain period of time.
By operation of law, where the debtor fails to perform an obligation within a
useful time or failed to perform immediately in case of urgency or where
performance becomes impossible due to the debtors fault.
If the creditor files a legal action against the debtor without placing him in default first,
the debtor maintains the right to perform the obligation within a reasonable time.
Damages:
Present Damages
Failure on the part of the debtor to fulfill his obligations can lead to bodily, moral
or material damages.
These damages have to be directly attributed to the fault of the debtor and
assessable in their present value.
Future Damages
Possible to seek future damages as long as they are certain to take place and
are assessable.
Example: an employee fired for unjustifiable reasons sues for breach of contract
and requests present lost wages and future wages based on how long it will take
to find another job.
Punitive Damages
Under certain circumstances, the failure to perform contractual obligations may
even open the possibility to seek punitive damages as directed by law.
Punitive damages are meant to be used as a tool to teach the debtor a lesson
and for preventative purposes. This is why the amount awarded cannot surpass
these purposes.
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Defences:
The law offers a person being sued for civil liability some possible defences which may
exonerate them partially or totally from having to compensate for damages resulting from
a personal act.
Types of defences:
o Victims Actions: it is possible that the victims damages are linked to their own
fault; they presumed the risk or they aggravated the damages suffered.
Victims damages may be partially or wholly attributed to their own fault.
Contributory negligence: the victim and the person being sued are
both partially responsible for the damages.
Victim might have accepted the risk when undertaking an activity or
action, which means that there was a foreseeable possibility of damages.
The acceptance of risk may be possible through these three
methods: signing a contractual waiver absolving the defendant of
having to compensate the victim for damages (waiver is not
enforceable), displaying a notice stating that they are responsible
for something and displaying a warning notice to be cautious.
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Victim may aggravate the damages due to their inaction in addressing the
injury (i.e. refusing medical attention).
The person being sued will only be held accountable for the
amount of damages suffered before the aggravation.
The Good Samaritan: when someone causes damages in the process of helping
others.
In the case of trying to save someones life or donating food, the person
being sued is free of any responsibility if the injury was not intentional and
could not be foreseen.
In the case of a persons disclosure of a trade secret for public health and
safety, the person must demonstrate the interest of the general public
over that of the organization.
Superior Force: damages caused are not within the control of the person being
sued. They were unforeseeable and unstoppable acts (i.e. earthquakes, floods,
lightening and ice storms).
Another Person made it Worse (Novus Actus Interveniens): a person being sued
may be found totally or partially free of liability because the fault of another
weighs heavier than their own fault.
Improper Use: defence may arise based on the fact that the object was not used
for its purpose or used in a way that it was not designed for.
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A non-parent must prove adequate surveillance or education over the child during the
delegated authority.
A person or an organization acting free of charge (i.e. grandparents) cannot be held
responsible unless they personally commit a grave fault.
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The more complex the product, the greater the need for detailed labels and safety
instructions to be included.
A safety defect can cause all of the following to be liable, they cannot escape liability by
claiming they were not aware of the defect:
o The manufacturer
o The distributor
o The wholesaler or retailer
The can only escape liability if they can prove that the victim was aware of the defect or
can claim superior force.