News

New first time home buyer incentive

Earlier this year, Trudeau’s federal budget for 2019 outlined a new incentive to help first time homebuyers buy their first home that he called a “shared equity mortgage”. It’s effectively an interest free loan from the federal government for eligible homebuyers.

More details have since been released, and it’s looking like it’ll be an exciting end of the year for first time homebuyers.

The program will be ready to receive applications on September 2, 2019, with the first closing taking place on or after November 1, 2019.

The definition of “first time homebuyer” is quite broad, and in fact includes buyers who have actually owned a home before:

  • you have never purchased a home before;
  • you have gone through a breakdown of a marriage or common-law partnership; or
  • in the last 4 years, you did not occupy a home that you or your current spouse or common-law partner owned.

If you’re looking to buy a new home soon, remember to ask your mortgage lender or broker about this incentive!

Police can search smartphone without a warrant on arrest

Smartphones today hold our entire digital lives. Not only do they hold our intimate emails and text messages, but much more importantly our smartphones also contains apps such as Dropbox and OneDrive which are already logged in and allows access to a treasure trove of our most personal files in the cloud. What happens when the police get a hold of our smartphone?

The good news is that the courts realize our smartphones are used to do more than just make phone calls, and recognize that a search of a smartphone is much more intrusive than, for example, a simple search of a bag. In R. v. Fearon, 2014 SCC 77, the Supreme Court wrote at at para 51:

[…] the search of cell phones, like the search of computers, implicates important privacy interests which are different in both nature and extent from the search of other “places” […]. It is unrealistic to equate a cell phone with a briefcase or document found in someone’s possession at the time of arrest. As outlined in Vu, computers — and I would add cell phones — may have immense storage capacity, may generate information about intimate details of the user’s interests, habits and identity without the knowledge or intent of the user, may retain information even after the user thinks that it has been destroyed, and may provide access to information that is in no meaningful sense “at” the location of the search […]

Moreover, the Supreme Court at para 53 recognizes that the law should not treat a smartphone differently whether it is password protected or not:

An individual’s decision not to password protect his or her cell phone does not indicate any sort of abandonment of the significant privacy interests one generally will have in the contents of the phone.

But the good news ends there. In a ruling released today, the Supreme Court held in R. v. Fearon, 2014 SCC 77 at para 64 & 83 that the police can search a smartphone without a warrant when arresting a suspect, and that this does not infringe on our constitutional rights against unreasonable search and seizure (which is what s. 8 of the Charter is all about):

I therefore reject the idea that s. 8 of the Charter categorically precludes any search of a cell phone seized incidental to a lawful arrest.

[…]

To summarize, police officers will not be justified in searching a cell phone or similar device incidental to every arrest. Rather, such a search will comply with s. 8 where:

(1) The arrest was lawful;

(2) The search is truly incidental to the arrest in that the police have a reason based on a valid law enforcement purpose to conduct the search, and that reason is objectively reasonable. The valid law enforcement purposes in this context are:

(a) Protecting the police, the accused, or the public;

(b) Preserving evidence; or

(c) Discovering evidence, including locating additional suspects, in situations in which the investigation will be stymied or significantly hampered absent the ability to promptly search the cell phone incident to arrest;

(3) The nature and the extent of the search are tailored to the purpose of the search; and

(4) The police take detailed notes of what they have examined on the device and how it was searched.

This is in contrast to a series of rulings by the Supreme Court recently in R. v. Spencer, 2014 SCC 43, R. v. Vu, 2013 SCC 60, and R. v. Telus, 2013 SCC 16, where the court concluded that searches of a computer in a residence required a separate warrant for computer data, and searches of records at a telecommunications provider also required a warrant.

Fearon was a narrow 4-3 decision with a strong dissent, and in time it may be overturned. However,  given the state of the law at the moment, it would be prudent to lock your phone with a strong password (instead of a biometric feature like a fingerprint or a weak 4 digit passcode), and to enable strong data protection/encryption.  Finally, keep in mind that if questioned by the police, you are under no obligation to answer any questions, incriminate yourself, or to disclose your password to the authorities.

Don’t sign a new cell phone contract until Dec 2, 2013

In a consumer-friendly move, the Canadian Radio-television and Telecommunications Commission (CRTC) released some new rules today governing new cell phone contracts.

The new rules will apply to new cell phone contracts that start on December 2, 2013.

In particular, the new rules:

  • allow consumers to terminate their cell phone contracts after 2 years without cancellation fees, even if they have signed on for a longer term
  • cap extra data charges at $50/month
  • cap international data roaming charges at $100/month
  • allow consumers to have their cellphones unlocked after 90 days, or immediately if they paid for the device in full
  • allow consumers to return their cellphones, within 15 days and specific usage limits, if they are unhappy with their service
  • allow consumers to accept or decline changes to the key terms of a fixed-term contract (i.e., 2-year)

Remember, in order to take advantage of these new rules, the cell phone contract must be signed on or after December 2, 2013.

Telus records all your texts

Yesterday, the Supreme Court in R. v. Telus, 2013 SCC 16 made an interesting ruling on what types of warrants are applicable to text messages under the Criminal Code.  What’s interesting isn’t the ruling – as expected, the Court decided that text messages are “private communications” and require a more specific warrant authorizing the interception of private communications rather than a general warrant order.

What’s really interesting is this case provides a glimpse into the internal workings of Telus as it processes text messages from its mobile subscribers.

It starts off quite normally, just like any other service provider:

When Telus subscribers send a text message, the transmission of that message takes place in the following sequence.  It is first transmitted to the nearest cell tower, then to Telus’ transmission infrastructure, then to the cell tower nearest to the recipient, and finally to the recipient’s phone.  If the recipient’s phone is turned off or is out of range of a cell tower, the text message will temporarily pause in Telus’ transmission infrastructure for up to five days.  After five days, Telus stops trying to deliver the message and deletes it without notifying the sender.

But then things get interesting:

Unlike most telecommunications service providers, Telus routinely makes electronic copies of all the text messages sent or received by its subscribers and stores them on a computer database for a period of 30 days. Text messages that are sent by a Telus subscriber are copied to the computer database during the transmission process at the point in time when the text message enters Telus’ transmission infrastructure. Text messages received by a Telus subscriber are copied to the computer database when the Telus subscriber’s phone receives the message. In many instances, this system results in text messages being copied to the computer database before the recipient’s phone has received the text message and/or before the intended recipient has read the text message.

This is interesting for a few reasons:

  1. If the sender or recipient of a text message is on Telus, then the text message will be stored for at least 30 days, and
  2. In light of this SCC ruling, Telus will give up the contents of all your text messages for the last 30 days when given a specific warrant under Part VI of the Criminal Code that authorizes the interception of private communications. However, for other mobile providers which don’t routinely store text messages like Telus, even when given such a specific warrant for the interception of private communications, they will be unable to supply the police with the contents of your previous text messages because no record of it exists.

New fee to play recorded music at parties

Weddings are expensive.  Thanks to a recent decision by the Copyright Board, it’s going to become a little bit more expensive starting this summer.

The Copyright Board of Canada has recently allowed new tariffs to be collected for playing recorded music at events such as weddings, parades, karaoke bars, and fairs. The cost varies depending on how many people attend the event, the type of event, and interestingly, would double if people are dancing at the event. For example, a wedding where the DJ plays a song from a CD with less than 100 attendees and at least one attendee dancing would cost an extra $18.50 per day, and a parade where recorded music is played on at least one float must pay at least an extra $32.55 per day.

It’ll be up to the event organizers to self-report and pay the royalty on their own initiative. If you have a wedding this summer, be sure to ask your event organizer whether or not these new tariffs apply to you.

Ontario court confirms new privacy tort

Earlier this year, the Ontario Court of Appeal in Jones v. Tsige, 2012 ONCA 32 confirmed the existence of a new tort of privacy, a cause of “action for intrusion upon seclusion”:

One who intentionally intrudes, physically or otherwise, upon the seclusion of another or his private affairs or concerns, is subject to liability to the other for invasion of his privacy, if the invasion would be highly offensive to a reasonable person.

The key features of this cause of action are:

  • the defendant’s conduct must be intentional, within includes reckless conduct;
  • the defendant must have invaded, without lawful justification, the plaintiff’s private affairs or concerns;
  • a reasonable person would regard the invasion as highly offensive causing distress, humiliation or anguish.

Proof of harm to a recognized economic interest is not required. However, given the intangible nature of the interest protected, damages for intrusion upon seclusion will ordinarily be modest.

The court also emphasized that the types of intrusions covered are to be decided objectively:

Claims from individuals who are sensitive or unusually concerned about their privacy are excluded: it is only intrusions into matters such as one’s financial or health records, sexual practices and orientation, employment, diary or private correspondence that, viewed objectively on the reasonable person standard, can be described as highly offensive.

This new development in tort law is welcome as previous cases were unclear whether a tort of privacy actually exists in Ontario. Businesses which keep financial or health records should make their employees aware that such a tort of privacy exists and should take steps to further protect their customers’ information.

Setback for creation of Canada wide securities regulator

In the United States, the Securities and Exchange Commission (SEC) regulates capital markets, including the stock market throughout the entire country.

In Ontario, the Ontario Securities Commission regulates the Toronto Stock Exchange (TSX), while in BC the British Columbia Securities Commission regulates the Vancouver Stock Exchange (VSE). However, there is no single capital markets regulator covering all of Canada.

A nationwide regulator covering all of Canada would ensure that Canada’s financial markets are regulated with the same laws and enforced with the same rigor, fueling Canada’s economy and maintaining Canada’s financial stability. With that aim in mind, the federal government has been trying to create a nationwide securities regulator for Canada for some time, under its proposed Securities Act.  Unfortunately, the creation of a nationwide securities regulator was dealt a setback by the Supreme Court of Canada in the Reference re Securities Act released today.

The problem is that under the Canadian constitution, the federal government has a general power to regulate trade and commerce but each provincial government has the sole power to regulate matters over property and civil rights and matters of a local or private nature within their own province.  The Court held that as it is currently drafted, the proposed Act is not chiefly aimed at genuine federal concerns, but is principally directed at the day‑to‑day regulation of all aspects of securities and is thus unconstitutional.

The Court however recognized that there are specific aspects of the Act aimed at addressing matters of genuine national importance that is distinct from provincial concerns, including the management of systemic risk and national data collection, which the provinces, acting alone or in concert, lack the constitutional capacity to sustain a viable national scheme.

The next step for the federal government then would be to redraft the Securities Act taking into account the Supreme Court’s ruling, and hopefully reintroduce it later on in 2012.  A nationwide regulator is important for Canada as a whole, and the federal government should make it a priority in the new year.

Defamation and linking to defamatory materials

The Supreme Court today tackled the issue of whether a hyperlink linking to another web page with defamatory material is itself defamatory.  The Court concluded that the use of a hyperlink to link to another page with defamatory material is not itself defamatory.

In Crookes v. Newton, 2011 SCC 47, the defendant Newton had posted material on his website linking to other websites that contained defamatory material about the plaintiff Crookes. Crookes sued Newton on the basis that two of the links he created connected to defamatory material, and that by using those hyperlinks, Mr. Newton was publishing the defamatory information.

The Court concluded that:

 Making reference to the existence and/or location of content by hyperlink or otherwise, without more, is not publication of that content.  Only when a hyperlinker presents content from the hyperlinked material in a way that actually repeats the defamatory content, should that content be considered to be “published” by the hyperlinker.

[…]

[…] the use of a hyperlink cannot, by itself, amount to publication even if the hyperlink is followed and the defamatory content is accessed […]

As the plaintiff in a defamation suit must prove on that the defamatory words were “published”, the use of a hyperlink to defamatory material, without more, is not defamatory.

BC court confirms website terms of use enforceable as legal contracts

In Century 21 Canada Limited Partnership v. Rogers Communications Inc., 2011 BCSC 1196, the BC Court held that Rogers infringed Century 21’s copyright and terms of use by scraping Century 21’s real estate listings from its website and incorporating the listings into the real estate search engine Zoocasa.

Starting in 2008, Zoocasa copied photos, property listings, and pricing from Century 21’s website and provided hyperlinks that directed a user to specific pages of the Century 21 Website that contained the property listings.  Despite letters from Century 21, Zoocasa chose not to stop scraping until early 2010, nearly 2 and a half years after Century 21 first advised Zoocasa they did not consent to Zoocasa’s activities and advised them of the Century 21 Terms of Use and Zoocasa’s breach of these terms.

The court considered the enforceability of website terms of use as a contract, and explored various analogous software licences and contracts created over the Internet such as shrink wrap agreements, click wrap agreements, and browse wrap agreements.  The court confirms that website terms of use are enforceable as legal contracts at para 119:

The act of browsing past the initial page of the website or searching the site is conduct indicating agreement with the Terms of Use if those terms are provided with sufficient notice, are available for review prior to acceptance, and clearly state that proceeding further is acceptance of the terms.

In addition, the court confirms that liability is not avoided by automating the website scraping as the scraping program must initially be set up manually.

The drive to determine what is patentable

Last week, the U.S. Supreme Court agreed to hear an appeal of Mayo Collaborative Services v. Prometheus Laboratories, Inc., on the issue of whether or not methods of medical diagnosis are patentable in the US.

Closer to home, tomorrow is the appeal hearing for Amazon v. Canada, Federal Court File A-435-10, in which Amazon seeks to have the Court of Appeal confirm that methods of doing business (such as a method of doing “1-click” shopping online in this case) are patentable in Canada. We should see a decision from the Court within a year.

These are exciting times for the patent bar as well as for scientists worldwide, as these decisions can affect many companies’ R&D directions in the coming years.

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