Company and Finance News:

Debate Continues Regarding Proposed Cooperative
Capital Markets Regulatory System
On July 9, 2014, on what Finance Minister Joe Oliver called "a landmark day" for reforming Canada's capital markets regulatory regime, the federal government announced that Saskatchewan and New Brunswick had agreed to join Canada, British Columbia and Ontario in the Cooperative Capital Markets Regulatory System (CCMR). The announcement follows on the September 19, 2013 agreement-in-principle between the governments of Canada, British Columbia and Ontario to jointly establish a single operationally independent cooperative regulator to administer provincial and federal capital markets legislation. With the addition of Saskatchewan and New Brunswick, the federal government can now boast that four provinces, representing approximately three-quarters of Canadian listed companies with a market capitalization of almost 53 percent, have agreed to sign on to the initiative. At the same time, the federal government renewed its invitation to all other provinces and territories to participate.

The goal of the CCMR is to eliminate the inefficiencies that are endemic to Canada's current system of 13 separate securities agencies. The CCMR reflects the federal government's response to a 2011 Supreme Court of Canada decision, which held that the federal government's first attempt to enact federal legislation to establish a national securities regulator was unconstitutional. Read the full article by Jeremy Fraiberg, Robert M. Yalden, Noralee Bradley and Shawn Irving with the law firm Osler. 

BC Securities – Policies & Instruments
The following policies and instruments were published on the BCSC website in the month of July:

• 52-108 – CSA Notice of Repeal and Replacement of National Instrument 52-108 Auditor Oversight and Amendments to National Instrument 41-101 General Prospectus Requirements, National Instrument 51-102 Continuous Disclosure Obligations and National Instrument 71-102 Continuous Disclosure and Other Exemptions Relating to Foreign Issuers
• CSA Staff Notice 24-310 – Status Update on Proposed Local Rules 24-503 Clearing Agency Requirements and Related Companion Policies
• CSA Staff Notice 51-341 – Continuous Disclosure Review Program Activities for the fiscal year ended March 31, 2014
• BCN 2014/09 – Lead Regulators and Exempting Regulators in relation to the Memorandum of Understanding respecting the Oversight of Exchanges and Quotation and Trade Reporting Systems as of July 1, 2014
• MFDA – Notice of BCSC Non-Objection to Proposed Amendments to MFDA By-law No. 1 and Articles of Continuance

For more information visit the BC Securities website.

BC to Crack Down on Suspicious
Trading from Offshore Accounts
British Columbia's securities regulator is funnelling more resources into a crackdown on suspicious trading activity coming from offshore bank accounts in "secrecy" jurisdictions, saying the accounts often belong to locals who are hiding their identities.

Lang Evans, manager of special investigations at the British Columbia Securities Commission, is heading a small investigative team focusing on cases where money is being funnelled into BC through bank accounts in countries with banking secrecy laws, including locations in the Caribbean.

"I think many of these instances where I'm encountering suspicious trading by a dealer supposedly in the Caribbean, or a bank in Liechtenstein or Switzerland, I believe they're acting for people in North America, and I suspect in most cases they're acting for people in the 604 [Vancouver] area code," Mr. Evans said in an interview.

A BCSC hearing panel ruled this week that two men acted "contrary to the public interest" when they used a stock newsletter to make false claims to tout shares of companies trading in the U.S. over-the-counter market. Read The Globe And Mail article.

PST Bulletins
The following PST bulletins and notices were issued in the month of July:

• Bulletin PST 140, Funerals
• Bulletin PST 119, Restaurants and Liquor Sellers
• Bulletin PST 309, PST and Non Residents
• Bulletin PST 310, Goods Brought Into BC

For more information, visit the Consumer Taxes website.

Energy and Mines News:

New Regulations Governing LNG Facilities – July 21^st
On July 21, 2014, the provincial government enacted the long-awaited Liquefied Natural Gas Facility Regulation ("LNGFR") after consultations with the First Nations, industry, government organizations and other stakeholders. Other regulations were amended on the same day for clarity: the Pipeline and Liquefied Natural Gas Facility Regulation was amended to exclude its application to LNG facilities and was renamed the Pipeline Regulation, and the Drilling and Production Regulation ("DPR") was amended to include a definition of "facility" that excludes LNG facilities. It is the LNGFR that now governs LNG facilities while the Pipeline Regulation and DPR do not. The BC Oil and Gas Commission (OGC) has simultaneously released an 80 page guidance document specific to the regulation. It provides a plain language overview of the regulation's requirements as well as significant contextual information about how the regulation fits into existing legislation and OGC standards. For example, it describes how the OGC and Transport Canada regulatory regimes will overlap to regulate floating LNG facilities. The LNGFR itself is technical in nature and addresses the regulatory aspects associated with applying for an LNG permit, the construction and operation of an LNG facility, and the risks associated with LNG facilities. As stated by the OGC, "included in the regulation are rules around the permit application process, engineering design requirements, hazard analysis, safety and loss management programs, risk assessment, emergency planning and response, flaring limits and noise and light control". Ancillary to these rules are a series of important document retention requirements. Read the full article published on the Bull Housser website. 

Mount Polley Spill Could Affect Whole Mining Industry
BC's mining association says the Mount Polley spill could lead to changes for the industry, even as First Nations leaders predicted the disaster will affect other resource projects and vowed to push for a public inquiry if they do not get the answers they are seeking.

Millions of cubic metres of waste spewed from a tailings pond into central BC waterways on [August 4^th] at the Mount Polley copper and gold mine, which is owned by Imperial Metals Corp.

Angela Waterman, vice-president of environment and technical affairs for the Mining Association of BC, said much about the spill is unknown, but it could have consequences for other mining outfits when the results of investigations come out. Read The Globe And Mail article. 

BC First Nation Behind Landmark Land Title
Case Releases Mining Policy
A British Columbia First Nation behind a recent Supreme Court of Canada case that significantly expanded aboriginal land title rights laid out ground rules [July 31^st] for mining projects on its traditional territory, requiring resource companies to minimize the negative impacts of projects while sharing revenue.

The Tsilhqot'in National Government's mining policy also follows the group's successful fight against the New Prosperity mine, proposed by Taseko Mines Ltd. (TSX:TKO), which was rejected by the federal government earlier this year due to the potential impact on a lake considered sacred by area First Nations.

The Tsilhqot'in Nation, located near Williams Lake, BC, said it isn't opposed to mining on its territory, but resource companies need to respect the rights of aboriginals if they want their projects to proceed.

"The goal is to have proponents actually come through the door of the Tsilhqot'in Nation," Chief Russell Myers-Ross of Yunesit'in, one of the six bands that make up the Tsilhqot'in, said in an interview. "We had the example of Taseko Mines, who showed us what not to do. We need proponents and industry to begin showing a lot more respect for our people and our nation if they want to build partnerships in our territory." Read The Vancouver Sun article.

Chevron Says No Interest in Boosting Stake
in Kitimat LNG Project after Apache Exit
Chevron Corp. said it has no interest in boosting its ownership share of Kitimat LNG project planned for the BC coast beyond 50% after partner Apache Corp. said it would sell its half of the project.

"We need to get our partnership resolved," George Kirkland, Chevron's vice-chairman and executive vice-president of upstream operations, said Friday as the U.S. oil major announced second-quarter results. Apache needs to move through the issues and we need to get a new partner in. That needs to happen "That means Apache needs to move through the issues and we need to get a new partner in. That needs to happen."

Houston-based Apache said [July 31^st] it would "completely exit" the Kitimat plant, casting doubt on the future of the multi-billion-dollar export proposal as well as BC's goal of seeing three LNG projects operating by 2020. Read Financial Post article. 

Family and Children News:

CLE Practice Point: The Family Law Act and
Treatment of Property Held by Trusts
This recent paper from the CLEBC course FLA for Estates Practitioners (June 2014) considers the division of property held by trusts, particularly discretionary trusts as prescribed by the FLA. Click here to read the article by Amy L. Chapman-Fluker of Aaron Gordon Daykin Nordlinger LLP. Source: CLEBC website

Family Law Pilot Project in Vancouver
and New Westminster
Beginning September 2, 2014, the Supreme Court will implement a family law pilot project for a period of two years. Under the project, a roster of several judges in both Vancouver and New Westminster will be assigned to a fixed term rotation of family work, including trials, chambers and conferences. Generally speaking, the roster judges will be assigned to the family law rotation for a term of six months. Legal Counsel will be engaged as a resource to the project. This initiative is timely in responding to the orderly development of jurisprudence under the Family Law Act, and in serving the needs of litigants in family cases, many of whom are self-represented. Source: BC Supreme Court website 

Forest and Environment News:

Environmental Appeal Board Decisions
The following Environmental Appeal Board decisions made under the Wildlife Act were released in the month of July:

• Robert J. Cutts v. Regional Manager (Kootenay Boundary Region) [Final Decision – Appeal Dismissed]
• Vince Cocciolo v. Regional Manager (Kootenay Boundary Region) [Final Decision – Appeal Dismissed]
• Bradley Bowden v. Regional Manager, Recreational Fisheries and Wildlife Program (Cariboo Region) [Final Decision – Appeal Dismissed with Recommendation]
• Christine Franke v. Regional Manager, Recreational Fisheries and Wildlife Program (Cariboo Region) [Final Decision – Appeal Dismissed with Recommendation]
• Hans-Albert Jacobs v. Regional Manager, Recreational Fisheries and Wildlife Program (Cariboo Region) [Final Decision – Appeal Allowed in Part with Recommendation]

Province Offers Pulp Mills $100 Million
for Energy Conservation
BC's Energy Minister is throwing a lifeline to the province's pulp mills, with up to $100 million for energy conservation projects to help offset rising industrial electricity rates.

Bill Bennett [made] the announcement in Surrey [July 24^th], flanked by four mill companies that had publicly warned they could be driven to economic hardship by his ministry's 10-year plan to raise BC Hydro rates.

The companies – Canfor, Catalyst Paper, Paper Excellence and West Fraser – operate thermo-mechanical pulp mills and are among B.C.'s biggest industrial power users.

Under the new program, they will be eligible for government money using a formula that involves the horsepower of refiners at their mills. The companies can use the funding toward new machinery or mill upgrades that will reduce power consumption, as long as they also contribute 25 per cent of the capital costs.

"We're estimating that the thermo-mechanical pulp industry in BC should be able to save roughly $17.5 million annually in electricity costs," Bennett said in an interview with The Vancouver Sun. Read The Vancouver Sun article. 

Health News:

Malcolm Maclure Rehired by BC Ministry of Health
Maclure fought back against government allegations he failed to protect patient data
Nearly two years after the BC government abruptly suspended or fired seven health researchers, one of them has been rehired as a research consultant by the Ministry of Health.

Dr. Malcolm Maclure, who was a director of research and evidence development with the ministry's pharmaceutical services division, was suspended in 2012 for allegedly providing preferential treatment to certain candidates and extended family members, and for allegedly "failing to prevent unauthorized access to data by employees and/or third parties."

Maclure fought back, launching a defamation lawsuit against the government, denying the allegations and defending his record as a world-leading authority on health research. Read the CBC article. 

Families Suing Drug Maker of Blood
Thinner over Bleeding Risks
Susan Garau, 61, was down with the flu last year when she was found incoherent and bleeding from her mouth while in bed.

By the time Garau arrived at Seven Oaks General Hospital in Winnipeg, the grandmother was hemorrhaging from several parts of her body including her mouth, intestines and brain.

"They were draining blood from the stomach, she was bleeding from her mouth … and by that evening she slipped into a coma and was bleeding everywhere," recalls Garau's daughter, Brigitte Pichon.

Garau had been taking Pradaxa – a blood thinner used to treat a heart condition called atrial fibrillation.

The drug is one of a new class of oral anti-coagulants that don't require regular blood tests. Pradaxa was approved for use in Canada in 2008. Read more on the CTV News website. 

Labour and Employment News:

WorkSafeBC Review Points to Enforcement
Changes and Tougher Penalties
Following a review into WorkSafeBC's procedures for conducting investigations, the BC government has announced that it will accept all 43 recommendations of the review's final report, the WorkSafeBC Review and Action Plan, which was made public on July 15, 2014. If the government does implement these recommendations, BC employers can expect provincial Occupational Health and Safety ("OHS") regulations to become more stringent and more effectively enforced. Non-compliance will likely carry more severe penalties. BC Labour Minister Shirley Bond appointed Mr. Gordon Macatee, the BC Ferry Commissioner, as Administrator of WorkSafeBC on April 14, 2014. She gave Mr. Macatee a mandate to review WorkSafeBC's investigation procedures after the Criminal Justice Branch declined to press criminal charges in the fatal Babine and Lakeland Mill explosions, both caused by combustible dust. The Criminal Justice Branch elected to not proceed with prosecution because the evidence collected in the course of WorkSafeBC's investigation of the mill explosions was likely inadmissible in court. Read the Davis LLP article by Alex Hudson and Richard Press. 

BC Human Rights Tribunal Issues New
Rules of Practice and Procedure
Following on its new complaint and application forms introduced earlier this year, the British Columbia Human Rights Tribunal recently issued new Rules of Practice and Procedure (the "2014 Rules"), replacing its former Rules from January 2008. The 2014 Rules are directed at reducing the number of rules and streamlining and simplifying the complaint resolution process.

Some of the changes in the Tribunal's 2014 Rules that employers should take note of include the following:

• The Tribunal has done away with its previous "complaint stream" process;
• The Tribunal has better articulated resources under the new Rules to defer complaints or adopt alternate processes to resolve complaints. For example, Rule 16 permits the Tribunal to defer a complaint if 1) another proceeding is capable of appropriately dealing with the subject matter of the complaint; OR 2) it is fair and reasonable in all of the circumstances to do so (both of which require an application to the Tribunal, which can now be filed prior to the filing of a response to complaint). Rule 17 expands the flexibility for the Tribunal to address complaints, permitting it to use "expedited or alternate" processes or timelines to facilitate the just and timely resolution of a complaint. Rule 17 replaces former Rule 25, which required all parties to consent to an expedited hearing, and is intended to be a flexible rule that can be initiated by the parties, or the Tribunal itself;

To read the full list of changes, read the full article by Donovan Plomp with McCarthy Tétrault.

Local Government News:

Questions About Upcoming Local Government Elections?
The Local Elections Campaign Financing Act (LECFA) came into force on May 29, 2014 to increase local elections campaign financing and election advertising accountability, transparency, compliance and enforcement. Candidates for local elections must now comply with LECFA, the Local Government Act and the Vancouver Charter (for City of Vancouver office) rules. The new legislation introduces several significant changes to local elections, including:

1. A role for Elections BC: Under LECFA, Elections BC is responsible for administering, investigating and enforcing LECFA's campaign financing and election advertising rules. All candidates, elector organizations and third party sponsors must now file their disclosure statements directly with Elections BC within 90 days following general voting day (February 13, 2015). A disclosure statement may be filed up to 120 days after general voting day; however, must include a $500 late filing fee (March 16, 2015).
2. Election proceedings period: The election proceedings period runs from September 30, 2014 to November 15, 2014. Election advertising (e.g. signs, posters, internet advertising, brochures and pamphlets) transmitted during this period must include sponsorship information.
3. Third party sponsors: A third party sponsor is an individual or organization that undertakes election advertising independent from a candidate or elector organization during the election proceedings period. Third party sponsors must register with Elections BC before undertaking any advertising and they must submit a disclosure statement to Elections BC.
4. Nomination process: Local governments now use standard nomination forms which require detailed contact information for candidates and their representatives. A solemn declaration (included in the nomination package) stating that the candidate is aware of, understands, and intends to comply with LECFA is also required.

Many sources of information are available to help local elections candidates and participants understand elections rules. Read the full article posted on the UBCM website.

Real Property Assessment and Taxation Paper
From CLEBC
This paper from Real Property Assessment and Taxation (November 2013) examines the criteria that determine whether a property is exempt from property tax. It also explains the differences between exemptions that must be applied automatically and those that can be applied at the discretion of the local government. Click here to read the paper by Ludmila B. Herbst and Nav Baidwan, both of Farris, Vaughan, Wills & Murphy LLP, Vancouver and referenced on the CLEBC website.

Province Moves Forward With Building Code
New legislation to govern building regulation is currently being developed by the Province. Given the potential impact on local government operations, the Executive has authorized UBCM staff to participate in the legislative process that is underway. UBCM has received a letter from Minister Coleman stating that he intends to introduce changes to the building code and invited UBCM to participate in an advisory group developing new legislation. Furthermore, the Premier in her mandate letter to Minister Coleman, has indicated that the Province intends to "introduce a new BC Building Code in the Spring 2015". The UBCM Executive has reviewed the matter and determined that the best way to serve the members is to join the advisory group.

Miscellaneous News:

Court Rules Consumers Not Confused
by BC Insurance Info Website
The Insurance Corporation of British Columbia has lost an appeal in which it sought to wrest control of the domain ICBCadvice.com from the owners of a website providing basic advice and marketing the services of insurance lawyers.

ICBC filed the initial suit against Stainton Ventures, which owns and operates the website in 2009, claiming the use of "ICBC" in the domain would confuse consumers and violated the official mark and trademark of the Crown corporation.

The B.C. Supreme Court ruled against ICBC in 2012, and the B.C. Court of Appeal upheld the result in a judgment released [July 22^nd].

The ruling is relevant to the B.C. insurance bar because many lawyers own domains that include "ICBC" in the name, such as icbccases.com, icbc-injury.com, and icbc-claims.com, to advertise their services.

ICBC argued consumers would be led to think the website was operated by the insurance provider. But the three-justice panel disagreed.

"I am unable to accept this argument as it fails to give the 'relevant consumer,' i.e., an Internet user, credit for even the most basic understanding of the function of a domain name," wrote Justice David Frankel for the three-judge panel.

ICBC, like other Crown corporations, the Canadian Armed Forces, and universities, can register official marks which have broader protections given to them than trademarks. Read the full article by Arshy Mann and published in the Canadian Lawyer and Law Times. 

Forfeited Drug Vehicle Gets New Life
Fighting Crime – Civil Forfeiture Act
To help officers get the message across that gang life is a dead end, the Province is providing the Kelowna RCMP with a forfeited sports car to reach local youth in an unconventional way.

A 2004 Nissan 350Z, courtesy of B.C's Civil Forfeiture Office (CFO), was unveiled today at the RCMP headquarters in Kelowna. The vehicle, which was previously involved in criminal activity, has been "wrapped" with messaging and graphics that highlight the dangers of gang life, organized crime and the drug trade. This rolling public service message will be seen driving around Kelowna for the next two years making stops at festivals, beaches, parades and events throughout the summer and all year long. Read government news release.

Motor Vehicle and Traffic News:

BC Court of Appeal Sends Strong Message to
Cyclists Who Pass Vehicles on the Right
Reasons for judgement were released [July 8^th] by the BC Court of Appeal addressing the practice of cyclists passing vehicles on the right finding, absent limited circumstances, that it is negligent to do so.

In today's case (Ormiston v. ICBC) the Plaintiff was involved in a 2009 cycling collision. As he proceeded down hill a vehicle ahead of him in his lane of travel "was almost stopped at the centre line". The Plaintiff had room on the right side of the vehicle and attempted to pass. As the Plaintiff did so the motorist veered to the right causing the Plaintiff to lose control.

The motorist left the scene and remained unidentified. The reason for the sudden veering motion remained unknown. The Plaintiff sued ICBC pursuant to section 24 of the Insurance (Vehicle) Act. ICBC admitted that the collision occurred and involved an unidentified motorist, however, ICBC argued the Plaintiff was fully responsible. Read the full article by Erik Magraken on his BC Injury Law blog. 

CVSE Notices for July
The Commercial Vehicle Safety and Enforcement (CVSE) program issued the following notices for the month of July under the Commercial Transport program:

• CVSE1013 - Restricted Routes for Wide Bunks Hauling Beetle Killed Wood
• CVSE1010 - East-West Overheight Corridors in the Lower Mainland
• CVSE1001 - Routes Pre-Approved for 5.0 m OAW

Visit the CVSE site for more information.

Property and Real Estate News:

Commercial Tenancy and Quiet Enjoyment:
The Court of Appeal Weighs In
Last year [Peter Roberts] blogged about a Nanaimo commercial tenant who defeated her landlord's claim for unpaid rent on the grounds the lease had been fundamentally breached as a result of a pervasive odour. Neither the landlord, nor the tenant could find the source of the smell though it was related to the HVAC system. The odour was adversely affecting the tenant's retail clothing business to the point she stopped paying rent. The landlord sued. At trial, the court found that the persistence of an unpleasant odour was a breach of the covenant of quiet enjoyment. The court held that the presence of "a strong and unpleasant odour" defeated the purpose of leasing the space "entirely by discouraging clientele from entering the Premises and ruining the product for sale." It was substantial enough to entitle termination of the lease on the grounds of fundamental breach.

The landlord appealed. In a setback for commercial tenants, the Court of Appeal recently overturned to the trial decision. They did so essentially on two grounds. First, the lease terms outlined that the leased retail space was provided to the tenant "on an 'as is, where is' basis" with no representations as to fitness. In addition, the lease made the tenant responsible for keeping the premises in good repair, including the HVAC system. These types of terms meant that the trial judge's finding of breach of a term of implied fitness was unsustainable. Read the full article published by Peter Roberts.  

Real Property Assessment and Taxation Paper
From CLEBC
This paper from Real Property Assessment and Taxation (November 2013) examines the criteria that determine whether a property is exempt from property tax. It also explains the differences between exemptions that must be applied automatically and those that can be applied at the discretion of the local government. Click here to read the paper by Ludmila B. Herbst and Nav Baidwan, both of Farris, Vaughan, Wills & Murphy LLP, Vancouver and referenced on the CLEBC website.

Wills and Estates News:

Dispensing Power of the Court under WESA
The Wills, Estates and Succession Act ("WESA") is now in force, and we are beginning to see its application in our estate practice. One of the most interesting new provisions is the dispensing provision in section 58.

Section 58 permits the court to order that a record, document, writing, or marking on a will or document is fully effective as a will (or is a valid revocation, alteration, or revival of a will), even if the formal requirements for the execution of a will have not been met. This is a significant change to the previous regime, which required compliance with the technical requirements of the legislation in order for a will to be valid. However, this new section is consistent with WESA's overall objective of seeking to give effect to the intentions of the will–maker.

Formal Requirements
The formal requirements for the execution of a will are that it must be in writing, signed at the end by the will–maker (or the will–maker must acknowledge the signature) in the presence of two witnesses at the same time, and signed by two or more witnesses in the presence of the will–maker and each other. Before WESA became law, these requirements were absolute, and the courts were unable to waive them.

Read the full article by Gordon Behan and Amy Mortimore with Clark Wilson LLP.

Court Upholds Effective Disinheritence
The British Columbia Supreme Court recently refused to vary a mother's Will that left only a token $10,000 to an estranged son. In Brown v. Pearce Estate, the challenged Will read in part:

"I wish to leave no more than the $10,000 referred to above to my estranged son … Although I have sacrificed for him and I have supported him over the years, he has refused any contact with me, and … he has made it clear that he wants no further relationship with me."

The son asked the Court to vary the Will, claiming that the mother owed him a moral duty to provide more than the $10,000 gift. The Court considered the facts carefully, and declined to order a variation.

In his reasons for judgement, the learned Mr. Justice Kent noted that in a claim under the Wills Variation Act, an estrangement may either negate or enhance the moral obligation of a parent to provide for a child, depending on the circumstances. Read the full article by Amy Mortimore with Clark Wilson LLP.

Trustees' Duty to Diversify Investments
The British Columbia Court of Appeal removed a trustee for lending all of the trust funds in one trust to a related trust, finding that the investment was an improvident one. In reaching its decision in Miles v. Vince, 2014 BCCA 289, the Court of Appeal found that it is implicit in a trustee's duty to exercise the care, skill, diligence and judgement of a prudent investor that the trustee diversify investments held in a trust.

William Vince settled two trusts, one of which he named the William Vince Family Trust, and the other, the Vince Insurance Trust. He settled the family trust in 2006 while he was healthy, and he transferred the shares of three companies, each of which owned real estate on Main Street in Vancouver. He settled the insurance trust after he was diagnosed with cancer, and that trust received the proceeds of his life insurance policy of over $2 million following his death in June 2008.

The terms of the family trust gave the trustee the discretion to make income and capital payments to Mr. Vince's three children. The terms of the insurance trusts also gave the trustee discretion to make income and capital payments, but both his widow, Cynthia Miles, and his three children were the beneficiaries of the insurance trust. Both trusts provided that on a division date, 80 years after the creation of the trust or such earlier date as the trustee decides, the capital would be divided among the three children. Read the full article by Stan Rule on his blog Rule of Law.