Monday, April 27, 2009

Do we have a Privacy Interest in our Garbage?

Residents of Toronto are familiar with the debate that can be generated by garbage, but not necessarily this kind of debate. In a case recently decided, the Supreme Court of Canada held that it was lawful for the police to use evidence of criminal activity taken from the contents of a person's garbage to obtain a warrant to seize the person's house and garage. As a result of the search, the police uncovered evidence that the defendant was operating an ecstasy lab in his home. He was subsequently convicted of several criminal offences.

The defendant appealed his conviction on the basis that by taking the garbage bags from his property, the police breached his right, guaranteed by section 8 of the Canadian Charter of Rights and Freedoms, to be free from unreasonable search and seizure. The Supreme Court of Canada dismissed the defendant's appeal and upheld his conviction. The Court's reasoning was as follows.

Mr. Justice Ian Binnie, writing for the majority of the Court, commented that labels are sometimes misleading. To describe something as "garbage" tends to presuppose the point in issue, namely whether the homeowner had any continuing privacy interest in what he had thrown out. The Court concluded that it is possible that the homeowner might have no further interest in physical possession of the garbage but a very strong interest in keeping private the information contained in the garbage. The question was whether he dealt with the garbage in such a way as to forfeit any reasonable expectation of keeping its contents confidential.

The Court concluded that this is an objective test to be determined considering the following factors:

1. The subject matter of the alleged search - Justice Binnie held that the subject matter is not simply garbage. He observed that residential waste includes an enormous amount of personal information about what is going on in our homes. The Court agreed with counsel for the Canadian Civil Liberties Association that a garbage bag may more accurately be described as a bag of "information" whose contents paint a fairly accurate and complete picture of a householder's activities and lifestyle. According to the Supreme Court, many of us may not wish to disclose those things to the public generally or to the police in particular. As a result, it concluded that the defendant had a continuing direct interest in the "information" that was in his garbage.

2. Concealing illegal objects - The Court held that the issue ought to be framed in terms of privacy of the area or thing being searched and the potential impact of the search on the person being searched, and not in terms of the nature or the identity of the concealed items. The seized garbage bags contained a lot of personal items other than drug making paraphernalia. Accordingly, the physical search was not confined to evidence of criminal activity, but to other activity as well.

3. Subjective expectation of privacy - The Court held that this is not a high hurdle - obviously, subjectively the defendant expected that the contents of the garbage bags would remain private.

4. Objective expectation of privacy - The Court held that the defendant had no objective expectation of privacy because the garbage was put out for collection in a customary location, it was at or near the property line, there was no manifestation of any continuing assertion of privacy or control (such as a locked receptacle) and the police took the bags to search for information as part of a continuing criminal investigation. However, it held that apart from the key issue of abandonment, the circumstances favoured the defendant.

5. The place where the search occurred - The essence of the defendant's complaint was the intrusion by the police into activities taking place inside his home rather than the fact that the police invaded the air space at the foot of his garden by reaching across the lot line for the bags. Accordingly, the Court concluded that the implication of focusing privacy protection is on people not places. But because the garbage at the property line was accessible to passers by, the Court found that the physical intrusion by the police was relatively peripheral.

6. Whether the subject matter of the search was in public view - The garbage bags were in plain view, but their contents were not.

7. Whether the subject matter of the search had been abandoned - Clearly the defendant intended to abandon his proprietary interest in the physical objects themselves. The question is whether he had a reasonable and continuing privacy interest in the information which the contents revealed to the police.

8. Whether the information was already in the hands of third parties - The Court held that it was not necessary to defer a finding of abandonment until the garbage had been picked up by garbage collectors because this step did not depend on any act of the defendant and would add little in the way of protection.

9. Was the police conduct intrusive in relation to the privacy interest - Given that the act of abandonment occurred prior to the police gathering the garbage bags there was no privacy interest in existence at the time of the police intervention which therefore did not constitute an intrusion into an existing privacy interest.

The Court found that having regard to all of these factors, that the defendant had abandoned his privacy interest in the contents of the garbage bag when he placed them at his property line for collection. The taking of the bags did not constitute a search and seizure within the scope of section 8 of the Charter and the evidence found by the police was admissible.

Regards,

Blair

Friday, April 3, 2009

Pension Reform in the Ontario Budget

My pension law partner, Priscilla Healy reports:

The Ontario budget promises some welcome flexibility for both pension plan members and employers, although at the expense of benefit security on retirement.
Pension plan members who have transferred their pension monies into LIFs or LRIFs will be able to immediately withdraw 50 % of their locked-in monies from these accounts, an increase from 25%., effective January 1, 2010. There will also be a temporary waiver of fees for unlocking those accounts on the grounds of financial hardship, effective for applications made on or after April 1, 2009. However, without amendments to the tax rules, once monies are withdrawn, there will be no ability to replenish those accounts on a tax deferred basis.
Employers will welcome the ability to extend solvency payments over ten years instead of the current five year requirement, starting with valuation reports on or after September 30, 2008. The new ability to consolidate existing solvency payment schedules and to defer new going concern and solvency special payments for one year will also help temporarily cash-strapped employers.
The ten year extension of solvency payments may be illusory for any but jointly governed plans, because it will not be available if more than one-third of the aggregate of plan members object. It is not clear why retirees or deferred vested plan members would not object to a reduction in the security of their pensions. Employers may have to depend upon the inertia of retirees and deferred vested plan members preventing a flood of objections, or upon the concern of retirees or those close to retirement as to the possible insolvency of the employer which could leave them with no retiree medical benefits.
On the flip side, to protect member security the budget proposes restrictions on employer contribution holidays for fiscal years ending in 2010 to 2012.
There are a number of other budget proposals arising from the November, 2008 Report of the Expert Commission on Pensions, and there is reference to the passage of Bill 133 that simplifies pension splitting on marriage breakdown. The intent is also expressed to adopt a new multi-jurisdictional agreement that will simplify the administration of registered pension plans with members in more than one jurisdiction.
This is the first time since the abortive Bill 198 in 2002 that an Ontario government has attempted significant reforms of the Pension Benefits Act.

Regards,

Blair

Bank Liability for Forged Cheques

My insolvency law partner John Varley reports:

Companies victimized by forgery routinely get no support from their bankers, unless they have reported the discrepancy within the usual 30-day "monthly statement objection" period. A recent court decision may cause banks to reassess that stance, depending on the language used in the relevant account operating agreement.

In a recent case before a judge of the Ontario Superior Court of Justice, an office manager forged $186,488 of cheques and the employer company sued to recover that amount after the bank cleared all those cheques and debited the company's account.

The Court held that the bank was strictly liable for honouring the forged cheques, and that no defence was available to it. The bank's honouring of the cheques was not a mere "error, omission or irregularity", but a violation of section 48 of the Bills of Exchange Act. If (as is the case with language used by other bank agreement forms) the account agreement in this case had been more broadly worded, or had specifically mentioned forgeries, a defence would have existed, but none was available here.

Nor did the mutual negligence (of both the bank and the company) resolve the matter. The Court held that the company owed the bank no duty (at the level of due care that would have detected the forgeries) to examine the monthly bank statements and report discrepancies within the 30-day notification period stipulated by the account operating contract. Nor did it owe the bank any duty to maintain internal accounting controls to minimize or prevent forgery losses.

Regards,

Blair

Women in Private Legal Practice

The Law Society of Upper Canada, the body that regulates lawyers and paralegals in Ontario, has introduced an initiative called "The Justicia Project" designed to support the retention and advancement of women lawyers in private practice. The initiative is the first of its kind in Canada and is a 3 year pilot project involving a group of law firms who have committed to sharing best practices and adopting programs to support women lawyers within their firms. The participants in the project have pledged to recognize the value of women lawyers in their firms and the importance of "balance, flexibility, mentorship, leadership and strong business management practices and skills".

More than half of lawyers called to the bar in Ontario are women. As a result, the law firms see the project as a practical way to structure their environments to attract and retain the best law students and lawyers.

More than 50 medium and large law firms have pledged to support The Justicia Project (including my firm Fogler, Rubinoff LLP). Each firm has committed to participate in the project for 3 years, from 2009 to 2011. All participants have signed written commitments to achieve goals in the following core areas:
- maternity and parental leave policies and flexible work arrangements;
- networking and business development;
- mentoring and leadership skills development for women; and
- monitoring progress.

More information is available about The Justicia Project and other initiatives to retain and advance women in private practice on the Law Society's website.

Regards,

Blair