Importance of the Press

On March 26, 2020, the Government of Saskatchewan further limited the businesses that can continue to operate in the province as a result of COVID-19.  Among the “critical services” that are to be maintained are local and national media.

Journalists across our province are continuing to provide up-to-date and important information to citizens. They continue to attend press conferences, ask our leaders important questions, try to digest and disseminate important health-related information and disabuse individuals of potentially dangerous misinformation.

Having reliable and professional information broadcast to a wide audience (through newspapers, television and social media) is incredibly important for our public officials to provide updates on this crisis. Dr. Theresa Tam, Canada’s Chief Public Health Officer, and Dr. Saqib Shahab, Saskatchewan’s Chief Medical Health Officer, have, through the media, imparted daily updates on the medical risks and transmission of the virus. Our political leaders have warned residents through daily press briefings on the importance of social distancing to attempt to flatten the curve.

In addition to providing important health information, the media has provided messages of hope and resilience. Media organizations have covered:

  1. The outpouring of support for marginalized youth in Saskatoon: https://thestarphoenix.com/news/local-news/the-helpers-in-saskatoon-an-outpouring-of-support-for-youth/
  2. Families working out together at home while practicing social distancing: https://saskatoon.ctvnews.ca/more-saskatoon-families-working-out-together-at-home-during-isolation-physical-distancing-1.4870362 and
  3. Veterinarians assisting pets from outside of their clinics: https://www.cbc.ca/news/canada/saskatchewan/sask-curbside-veterinary-medicine-animal-health-covid-19-1.5511951.

In recent years, the media has been vilified in some corners.  However, it is at times like these, that the importance of the press is highlighted.  We see journalists, every day, digesting quickly changing information, trying to weed out “fake news” and doing so at potential personal peril as they attend briefings and track down stories.  The media has proven itself to be a “critical service” to the public.

For more information, please contact:

 

Sean M. Sinclair

306.933.1367

Email: s.sinclair

Corporate Governance during the COVID-19 Pandemic

Local authorities continue to encourage people to refrain from gathering in large groups and to practice social distancing. In this landscape, corporations should consider alternative means of holding director and annual shareholder meetings in the coming months.

This article addresses the legislation applicable to corporations incorporated under The Business Corporations Act (Saskatchewan) (the “Act”). While corporations incorporated under federal or other provincial statutes are subject to similar rules, the specific incorporating statute should be carefully reviewed in each case. In addition, directors should bear in mind that there is no one-size-fits-all approach, and it is recommended that directors consult with legal counsel to determine the best approach for their corporation to ensure the safety of all parties. 

Shareholder/Member meetings

Typically, annual general meetings of the shareholders (“AGM”) often involve a number of shareholders meeting in a physical location within Saskatchewan. Given that meetings over a certain number of attendees is now prohibited in Saskatchewan and leaving one’s home is generally discouraged, holding an AGM in person is no longer feasible in many circumstances. It is also important to remember that unless the required number of shareholders are present at a meeting, there will be no quorum reached and decisions cannot be made.

Given the current environment, what options are available to corporations?

1. Postpone the AGM

Under the Act, the directors of Saskatchewan corporations are required to call an AGM not later than 18 months after the corporation comes into existence and subsequently not later than 15 months after holding the last preceding AGM. Depending on the timing of incorporation and/or the last AGM, it may be possible to postpone the AGM to a later date. While it is uncertain how long the prohibitions on public gatherings may last, postponing the AGM by a few months may be worth considering.

2. Virtual AGM

A virtual AGM would take place over a virtual platform which would allow people to attend via telephone or videoconference. The Act allows shareholders of a corporation to attend a meeting of shareholders by means of telephone or other communication facilities as long as all participants are able to communicate adequately together. Directors contemplating holding a virtual AGM should consider the following:

 

  1. 1a. Corporate articles, by-laws, and unanimous shareholders’ agreements (“USA”): directors will need to review the corporate articles, by-laws, and USAs to determine whether these documents prohibit a virtual meeting. Directors should also consider any procedural matters contemplated within the by-laws or USA, including notice requirements, taking votes, and quorum requirements.

     

  2. 2b. Method of holding meeting: the directors will need to find some kind of technology or service that will allow for adequate communication between all shareholders and other attendees of the AGM. If the parties are not able to communicate to each other, the validity of the meeting could be challenged.

     

  3. 3c. Business of the meeting: if the agenda contains contentious matters, it is often preferable to deal with such matters in-person rather than in a virtual AGM. If a virtual AGM is to be convened, directors should consider the agenda and entertain the possibility of deferring any contentious business to a later date.

     

  4. 4d. Voting: generally, voting at a meeting of shareholders is done by a show of hands. In the event that some attendees are not visible in a virtual AGM (making the counting of hands impossible) directors will have to determine how votes will be tallied in a fair and reliable manner.

     

  5. 5e. Notice: in addition to providing the information required by the Act, by-laws, and/or any USA, a notice to the shareholders should contain detailed instructions on how to attend the virtual meeting.

Director Meetings

Similar to AGMs, meetings of the board of directors of a corporation are traditionally held in-person at a location in Saskatchewan. However, the Act also allows directors to attend a meeting of directors by means of telephone or other communication facilities that allow all attendees to hear each other.

While the considerations discussed above are relevant in determining whether a director meeting should be postponed or held in a virtual forum, the directors must be sure to review the corporate articles, by-laws, and any USAs. These documents may dictate when and where meetings of directors must be held, and other related procedural aspects.

Considerations for Non-Profit Corporations and Condominium Corporations

In May, 2020, the Saskatchewan Government introduced regulations which permitted non-profit corporations (incorporated under The Non-profit Corporations Act, 1995) and condominium corporations (constituted under The Condominium Property Act, 1993) to allow such corporations to hold annual general meetings of the members/owners through telephonic, electronic or other communication facility as long as all participants to the meeting are able to adequately communicate with each other. Likewise, meetings of directors of these corporations are generally permitted to hold virtual meetings as long as all directors consent. Accordingly, the considerations discussed above are relevant to these kinds of corporations. As always, it is important to remember that these rules are subject to the bylaws of the non-profit corporation or the condo corporation.  

For more information, please contact:

 

Jon M. Ponath

306.933.1365

Email: [email protected]

Witnessing of Legal Documents

If you have ever been involved with a legal matter such as a transaction involving real property, the granting of a power of attorney, or execution of a Will, you may be aware that certain legal documents require the personal attendance of a lawyer to witness its execution. The COVID-19 pandemic presents obvious challenges for lawyers and clients to comply with the legal requirement to have a lawyer physically meet with his/her client to witness the signing of a document.

On March 26, 2020, the Government of Saskatchewan enacted emergency regulations to enable lawyers to execute and witness certain documents by video conferencing (through applications such as Skype, Facetime, or Zoom, for example) to allow lawyers to assist clients while maintaining social distancing so as not to put clients, staff or lawyers at risk. These emergency regulations apply to real estate transaction documents that must be filed with the Land Titles Registry, Powers of Attorney, and affidavits and other sworn documents. While certain strict procedural steps must be followed,  our lawyers are committed and remain available to help you in getting important documents signed and witnessed to ensure they will be legally valid in accordance with the emergency provisions that have been put in force by the government.

These emergency regulations do not apply to the signing of Wills and Health Care Directives. The Government of Saskatchewan enacted additional regulations on April 16, 2020 that address the virtual witnessing of Wills. However, these regulations impose additional procedural steps that must be carefully followed. Please contact us for further information and advice respecting getting properly executed estate planning documents in place. Our office is committed to finding practical solutions to ensuring Wills and other estate planning documents can be witnessed in a safe manner. To this end, Robertson Stromberg has commenced several initiatives relating to workplace hygiene, monitoring lawyers’ and employees’ health, and following all Health Canada, CDC, and SaskHealth recommendations to maintain the safety of its clients who are required to meet with our lawyers.

For more information, please contact:

 

Jon M. Ponath

306.933.1365

Email: [email protected]

Cash Flow Concerns: How to Collect Payment in the Midst of COVID-19

Introduction

Over the past year much of the focus of the Saskatchewan construction industry has been on the impact that new prompt payment legislation will have on the timeliness of payment on construction projects. Cash flow is never far from the mind of any prudent business owner. However, a focus and concern with cash flow is perhaps never more evident than now, given the global, and increasingly local, rescheduling and shutdown of various construction projects.

In considering your ability to collect on outstanding invoices, it is critical that the payment terms of your contract be reviewed. Although contract terms, like force majeure, may justify a suspension of work or an adjustment to schedule, they do not necessarily suspend or modify a party’s payment obligations. Rather, the exact contract language needs to be reviewed. Absent specific contractual language excusing a party’s payment obligations, payments are still required to be made.

However, what is legally required, and what will, in practice, actually happen are, of course, two different things. A contractual right to be paid, though important, may not change the fact that certain companies will either not be able to pay or will, in an act of self-preservation, simply choose not to pay. In these types of circumstances, a few different collection options should be considered:

  1. Register a lien. Although a lien may not result in immediate payment, it provides security, in the event the project fails or is not completed, for future payment. It also ensures, in the event a future progress draw is made, that enough funds are withheld to satisfy the lien claim in the future. Although it is best practice to ensure a lien is registered in Saskatchewan within 40 days of substantial completion, liens can still be registered after this date and, in many circumstances, will remain enforceable.
  2. Determine whether or not a project is secured by a labour and material bond. Labour and material bonds are secured by insurance companies. As companies cease meeting their obligations, the ability to receive payment from an insurance company under a bond may, in certain cases, represent the best option available to collect payment. As labour and material bonds have predetermined pay-out amounts, it is important to submit your claim for payment as soon as possible. All L&M bonds have cap limits, and after the insurance company has paid out the amount of the bond, additional claims cannot be processed.
  3. Determine whether or not the project is secured by a performance bond. Although a performance bond is often put in place for the benefit of the owner, in the event a general contractor defaults, the ability of an owner to rely upon insurance to complete a project may be beneficial, given the possibility of the insurer using existing subcontractors to complete the work.

  4. File a lawsuit. Although lawsuits typically do not lead to quick payment, if your claim for payment is not defended, you may have the ability to register and then enforce a judgment. As judgments, once registered, exist for 10 years, this also may give your company a long-term option to satisfy a debt.

  5. Be mindful of trust obligations in the lien legislation. Saskatchewan’s lien legislation imposes trust obligations on project financing, and on funds paid between the owner, contractor and subcontractors. During times of cash flow crisis, it may be tempting for parties to pay money out of the project chain. This may result in a breach of trust obligations under the lien legislation, and could lead to personal liability for directors and officers as well. The lien legislation provides lien claimants a right to certain information from the owner, so use these tools to find out what’s happening in the project payment chain.

Like any situation, the best approach depends on your particular circumstance. However, all options should be explored given the uncertainty that is COVID-19.

For more information, please contact:

Misty M. Alexandre

306.933.1352

Email: [email protected]

Jared Epp

306.933.1326

Email: [email protected]

Estate planning in a time of uncertainty

As the world changes in response to the coronavirus (Covid-19) outbreak, you may wonder how you can legally best protect yourself, and loved ones. The present is a good time to make certain that you have certain crucial legal documents in place.

Last Will and Testament

Every adult should have a Will in place at all times. The Will ensures your instructions are honoured after your passing. You will name a party to be your executor, and you will clearly set out the terms you wish for the distribution of your property. It is encouraged that you consult a lawyer in drafting your Will, to ensure the Will is not easily challenged, or subject to misinterpretation.

Power of Attorney

With the advent of Covid-19, many people may need to provide care to elderly parents. If your parents wish you to make such decisions, it is very important that you have the legal authority to do so.

The legal way to confer such decision making power is through a power of attorney, naming someone as the “attorney”. A grantor should only choose someone you trust implicitly – you will be giving them immediate power over your banking, money, and property.

If someone has an illness such as dementia or Alzheimer’s, and is therefore already unable to make their own decisions, they will not be able to validly name an attorney. Instead, a loved one may need to seek a court-appointed guardianship order to be able to make decisions on their behalf.

Health Care Directive

A Health Care Directive allows you to express your wishes regarding medical treatment. This document can become important if you later lose the ability to speak or communicate. The Health Care Directive will name a proxy to make medical decisions for you.

Making sure that you have signed the above legal documents to better protect yourself is a means to exert control in this time of uncertainty. And given the current impetus to stay at home, what better time to deal with estate planning? For any specific questions, readers are encouraged to consult a lawyer.

The above is for general information only. Parties should seek legal advice prior to taking action in specific situations. Robertson Stromberg LLP offers legal advice and representation in all areas of law, including experience in estate planning, and estate litigation.

COVID 19 and Co-Parenting

Introduction

COVID-19 is creating uncertainty across the world and in our homes. Amid school and daycare cancelations, altered work schedules, self-isolation and growing health concerns, parents have been especially impacted by the pandemic. Separated and divorced parents are faced with the additional challenge of parenting their children between households during this time. The following is intended to provide information and considerations for separated and divorced parents. This information is not intended as legal advice. Should you have any questions respecting family law related matters we recommend that you consult with a lawyer.

Parenting Orders and Agreements

Parenting arrangements that are set out in Agreements or Court Orders should continue despite the pandemic. While the Courts in Saskatchewan have not yet had the opportunity to address this issue, it is expected that parties to an Agreement or Court Order will abide by the terms of the Agreement or Order. In a recent ruling in the United States it was determined that Court Orders for parenting time are not impacted by COVID-19; it is expected that our courts would take the same position. It is important for children to continue to have consistency and ongoing relationships with each of their parents, especially in times such as these when children may be especially anxious. Relying on the pandemic as reason to deny parenting time is not reasonable; it is not an opportunity to “cut out” the other parent. What the Courts will want to see is parents coming together during a time of uncertainty to act in their children’s best interests.

In extraordinary cases where there may be imminent risks to the children, parenting arrangements may need to be altered. Examples of which might include, where a parent has recently travelled to a high risk area, where a child has compromised immunity, where a parent or child has been in close contact with someone diagnosed with COVID-19, or if the parent or child has COVID-19 symptoms or has been diagnosed with COVID-19. If one of these exceptions exists, it is important that you communicate with the other parent and attempt to reach a resolution that safeguards the health of all involved. If you are unable to reach a resolution, or have questions about what constitutes an extraordinary circumstance, you should contact a lawyer.

Communication

With the closure of schools and daycares, the reality is that many parents will have to alter their parenting arrangements. This is a time for co-operation and flexibility to ensure that your children’s needs are being met. Important discussions should also be had between parents. Such discussions might include how to talk to your children about the pandemic, ensuring proper hygiene and handwashing in both households, whether to self-isolate the children, whether to avoid playdates, and what the plan will be if a child exhibits symptoms of COVID-19. The implementation of consistent COVID-19 precautions in both households will not only maintain stability for the children but will ensure that their health is foremost.

Self-Isolation

In the event parents determine that children or themselves should self-isolate, there are many ways in which children can communicate with the parent whom they are not with. In addition to texting and phone calls, electronic communication such as FaceTime and Skype allow children to maintain contact with their parents. Be creative and read books over the phone, play games such as “I spy” on FaceTime, or watch shows together on Youtube.

Conclusion

Children are looking to their parents for hope, safety and security during this time. Now more than ever it is important for parents to be civil and respectful to each other. Communicating with the other parent to ensure the well-being and stability of the children is vital. If this cannot be done, it is important to communicate through a third party to work out a sensible solution.

For more information, please contact:

 

Kirsten M. Hnatuk

306.933.1351

Email: [email protected]

Area of Expertise