BC Business Law Blog

Meldon Ellis interviewed by CBC News

2010-04-21T15:59:00.001-07:00

Excerpt from "Your Boss Knows What You Do Online" Full article found here: http://bit.ly/cEaKOy 7

April 21, 2010 12:54 PM

It's one thing if the information is true. But what happens if the information found online is completely false?

That's what happened to Meldon Ellis, now a lawyer. He was working for a tech company a number of years ago when a client launched a vicious online attack. The posts with the lies were always the first to come up in a Google search. They made it appear as though Ellis was involved in fraud. He had to answer questions about those posts for years in business meetings and job interviews.

Ellis eventually won a defamation suit and had a court order forcing Google to remove the questionable links. But the best thing he says he did was take charge of his online reputation.

"Jealously guard and protect your web profile and consider that as an asset and not allow it to
get into the hands of someone who can wreak havoc on your reputation." Meldon Ellis Ellis built his own website and updated it regularly. He approved stories about him online, moving those further up the Google search list. Over time the defamatory stories were moved down and were lower on search rankings.

He had to do this a few years ago on his own. Now there are companies who will do it for you for about 15 hundred dollars.

Most people think they're not interesting enough to have an online attack or anything harmful come up on a search. Most people are right. But for anyone applying for work, looking for a promotion, or even looking to join and/or lead a volunteer organization, check what your online reputation is, and make efforts to change it if need be.

On a personal note, journalists are used to comments and complaints made about them, or their work. It's part of our job. But not part of the job for those who don't put themselves in front of the public.

Meldon Ellis Comments to Vancouver Sun on "Hotel hikes room rates on Olympic tourists"

2009-10-26T12:21:00.006-07:00

Hotel hikes room rates on Olympic tourists

Guaranteed price not being honoured by former Quality Inn Vancouver Airport Hotel

The former Quality Inn Vancouver Airport Hotel has been stripped of its Quality Inn franchise, leaving hundreds of customers who made guaranteed bookings for the 2010 Olympic Games facing stiff price increases to retain their rooms. Read full article here.

BY RANDY SHORE, CANWEST NEWS SERVICE OCTOBER 26, 2009

Ellis Business Lawyers - Successfully Resolves Major Commercial Disputes

2009-10-13T14:38:00.002-07:00

Ellis Business Lawyers have successfully resolved a number of major commercial disputes, including:

Representing a BC and Alberta, Canada wine distributor who was terminated, as the distributor, of the most successful wine brand in North America. There were four law firms on the other side, three in Australia and one here in British Columbia. Resolved within 6 months of opening the file, through mediation, in October, 2008;

Representing an Ontario-based licensor of specialized fire fighting products in a trademark infringement and unpaid royalty. Resolved by litigation and negotiation in April 2009; and,

Representing shareholders in an ownership dispute. Resolved through a combination of a court hearing and negotiation in July 2009.

Meldon Ellis (Ellis Business Lawyers) Organizes Corporate Structure & Negotiation

2009-09-17T15:37:00.002-07:00

(Vancouver, British Columbia) Thursday, September 17, 2009. Ellis Business Lawyers (EBL) Principal Meldon Ellis, successfully organized the Corporate structure and negotiated a long term lease on behalf of a restaurant/entertainment company based in Vancouver, BC.

Harvey Meller - Closes the Sale of Promotions & Marketing Company

2009-09-04T14:25:00.004-07:00

(Vancouver, British Columbia) Tuesday, September 01, 2009 Ellis Business Lawyers (EBL) Associate, Harvey Meller, successfully advised and closed the sale of a business on behalf of a Denver, Colorado based promotions and marketing company to a BC based Buyer.

EBL - Advises on Purchase of Business

2009-09-02T14:13:00.008-07:00

(Vancouver, British Columbia) Tuesday, September 01, 2009 Ellis Business Lawyers (EBL) Associate, Harvey Meller, successfully advised two BC based entrepreneurs on a variety of issues associated with the purchase of businesses in the hospitality and entertainment industry.

Ellis Business Lawyers - Successfully establishes new Corporation on behalf of a Toronto, Ontario based Technology Company.

2009-09-01T14:12:00.005-07:00

(Vancouver, British Columbia) Tuesday, September 01, 2009 Ellis Business Lawyers (EBL) Associate, Harvey Meller, successfully established a new Corporation on behalf of a Toronto, Ontario based Technology company. The client was advised on leveraging higher deposit insurance with Credit Unions.

Ellis Business Lawyers - Establishes new Corporation for Silicon Valley, California based Technology Company.

2009-09-01T13:51:00.010-07:00

(Vancouver, British Columbia) Tuesday, September 01, 2009 Ellis Business Lawyers (EBL) Associate, Harvey Meller, successfully established a new Corporation on behalf of a Silicon Valley, California based Technology company, and provided the client various advise on their cross marketing border legal issues.

Darius Martinez

2009-08-05T13:08:00.005-07:00

Ellis Business Lawyers are pleased to introduce Darius Martinez. As a Collections Advisor he has extensive experience in the credit management, real estate and finance industries with a distinctive approach designed to deliver highly effective debt collection solutions. His commercial experience and business nous excels Ellis Business Lawyers in delivering significant collection results to clients. Feel free to contact Darius directly at 604.688.7374 or darius@ellislawyers.com

Harvey Meller

2009-03-10T23:21:00.005-07:00

Vancouver Sun - MOVES
March 9th, 2009

Harvey Meller has joined Ellis Business Lawyers as an associate lawyer focusing his practice on business law, business transactions and entertainment law. Click Vancouver Sun article or here for National Post article.

Billable Hours Giving Ground at Law Firms

2009-02-02T02:43:00.009-08:00

By JONATHAN D. GLATER. Published: January 30th, 2009 - New York Times.

With clients watching costs, law firms are rethinking the billable hour, with some firms adopting flat fees instead.

Clients have complained for years that the practice of billing for each hour worked can encourage law firms to prolong a client’s problem rather than solve it. But the rough economic climate is making clients more demanding, leading many law firms to rethink their business model.

“This is the time to get rid of the billable hour,” said Evan R. Chesler, presiding partner at Cravath, Swaine & Moore in New York, one of a number of large firms whose most senior lawyers bill more than $800 an hour.

“Clients are concerned about the budgets, more so than perhaps a year or two ago,” he added, with a lawyer’s gift for understatement.

Big law firms are worried about their budgets, too. Deals are drying up, and only the bankruptcy business is thriving. Two top firms, Heller Ehrman and Thelen, have collapsed in recent months. Others have laid off lawyers and staff. So cost-conscious clients may now be able to sway long reluctant partners to accept alternatives.

The evidence of a shift away from billable hours is, for now, anecdotal, as few surveys exist. But partners at a half-dozen other big bellwether firms and lawyers at corporations, who sometimes engage outside counsel, say they are more often seeing different pay arrangements.

Mr. Chesler, who is an advocate of the new billing practices, said that instead of paying for hours worked, more clients are paying Cravath flat fees for handling transactions and success fees for positive outcomes, as well as payments for meeting other benchmarks. He said that such arrangements were still a relatively small part of his firm’s total business, but declined to discuss billable rates and prices in detail.

The system of billing by the hour has been firmly in place since the 1960s; keeping track of time spent provided a rationale for the amount charged. In earlier, perhaps more trusting times, firms stated a price “for services rendered,” without explanation.

But one has only to eavesdrop on a table of law associates comparing their workloads to get a sense of how entrenched the billable hour is, creating a pecking order among lawyers, identifying the best as the busiest and the most costly.

With a sigh that is simultaneously proud and pained, lawyers will talk about charging clients for 3,000 or more hours in a year — a figure that means a lawyer spent about 12 hours a day of every weekday drafting motions or contracts and reviewing other lawyers’ motions and contracts.

“Does this make any sense?” said David B. Wilkins, professor of legal ethics and director of the program on the legal profession at Harvard. “It makes as much sense as any other kind of effort to measure your value by some kind of objective, extrinsic measure. Which is not much.”

To be sure, lawyers may be talking a good game but secretly hoping that the economy will bounce back and everything will return to normal, said Frederick J. Krebs, president of the Association of Corporate Counsel, whose members work in the legal departments of corporations and other organizations. He said that lawyers cheerfully lamented the bad incentives created by billable time for years, even as they grew rich from the practice.

“I like to paraphrase Churchill,” Mr. Krebs said. “In all these conversations, never has so little been accomplished by so many for so long. It just hasn’t happened.”

But the crashing economy may achieve what client complaints could not, Mr. Krebs added. “We may well be at a tipping point here.”

Greed may also encourage lawyers to change their payment plans. Law firms are running out of hours that they can bill in a year, said Scott F. Turow, best-selling author of legal thrillers and a partner at Sonnenschein Nath & Rosenthal in Chicago.

“Firms are approaching the limit of how hard they can ask lawyers to work,” he wrote, in an e-mail response to a reporter’s query. “Without alternative billing schemes, lawyers will not be able to maintain the rapid escalation in incomes that big firms have seen.”
e legal business — the billable hour.

By JONATHAN D. GLATER. Published: January 30, 2009

Why Dispute Resolution is Better than a Civil Case

2008-10-21T09:52:00.005-07:00

Dispute resolutions are methods of settling civil differences outside a formal court of law. They have various advantages over litigations, not the least of which is the significantly reduced cost. Dispute resolution plays a large role mostly in business and family affairs – either in the division of property when business partners separate or in the separation of husband and wife and the subsequent division of property and custody of children, most individuals prefer the relative anonymity of a dispute resolution rather than having to wash their dirty laundry in public.

There are three kinds of dispute resolution:

Mediation: involves an amicable resolution to the problem in the presence of a neutral individual whose main role is to smooth ruffled feathers and help them reach an understanding. A mediator is not someone who tries to bring a reconciliation between the two warring parties; rather, his or her role is limited to remaining an almost silent spectator as both parties try to reach an amicable settlement, stepping in only to prevent potential flare ups and physical altercations.

Neutral Evaluation: A neutral evaluation is similar to a court trial in that an expert on the law, like a judge or senior lawyer, is provided with details of both sides of the case and asked to provide his or her opinion on the ruling both parties can expect if they take their differences before a court of law. Each of the parties, or their individual lawyers, present the facts of the case either as written statements or as oral depositions, and wait for the neutral third party arbitrator to provide his or her version of the outcome.

Arbitration: involves a third party adjudicator who listens to both sides of the case and pronounces a ruling, as is done in a court of law.

Mediation and neutral evaluation are different from arbitration because:

Both parties have to agree by the decision of the arbitrator as opposed to mediation or neutral evaluation where the parties are free to seek the services of other mediators if they are not satisfied with the present advice or are unable to reach an amicable solution to their differences.

A ruling in an arbitration is similar to the ruling of a judge in a court of law. But, while it has a whole lot of similarities with a civil case, there are a number of differences:

It’s not as expensive, although you do have to pay for the services of the arbitrator for their time and expertise. Court cases are notorious for draining you of all your resources, what with having to pay for attorneys, expert witnesses and the cost of a trial. Compared to this rigmarole, arbitration is a cheap (yet legal) option.
You don’t have to wait for the court calendar to clear before your case is heard, thus saving yourself precious time in which you can recoup your losses and get on with your work and life rather than waste time in limbo waiting for your case to come to trial.
And best of all, your private affairs remain private. Dispute resolutions are not open affairs like court cases where the proceedings are transcribed by a court reporter and saved for posterity. This saves you the ignominy of losing both existing and future clients as a result of the ugliness of the dispute.

This post was contributed by Kelly Kilpatrick, who writes on the subject of the colleges for criminal justice. She invites your feedback at kellykilpatrick24@gmail.com.

FAQ'S - Business Dispute Resolution

2008-06-10T17:33:00.000-07:00

Business Dispute Resolution
Business dispute resolution can involve mediation as well as litigation, but my orientation from the outset is always going to be: how do we get into a position to resolve this dispute? I am always trying to arrive at an efficient, effective resolution of the dispute without spending unnecessary amounts of resources. I am looking at an alternative to the typical litigation process, which can often take months or years to reach a resolution. I try to find an opportunity to use mediation or negotiation at various stages, but I will always attempt to resolve the dispute from the outset by encouraging dialogue between the parties, giving them both an opportunity to explain where they are coming from and create an opportunity for resolution. This doesn’t happen in every situation, however.

Sometimes, by the time they have contacted a lawyer, the relationship between the parties has soured, and some litigation will be necessary. What we do then is start the litigation process and take as many steps in that process as are necessary.

Any lawyer who is dealing with business dispute resolution needs to be competent at litigating and using the various litigation tools that are available, as well as having skills as a problem solver. Those problem solving skills involve analytical skills to understand what is going on with the business disputes. Having a sound understanding of business helps a lot in this area too, and I think my previous experience as a business owner and the business manager of various businesses including a public company gives me that background. A knowledge of business is helpful as well as expertise and experience with alternative dispute resolution methods, primarily mediation and negotiation.

Mediation
The benefits of mediation in business dispute resolution.
Litigation is a fairly expensive process, particularly civil litigation. The disadvantage is not only the cost of litigation but also the time involved. A typical civil case can take 18 months to two years to resolve. On the other hand, mediation can be done in a couple of days or in an afternoon, and within a few weeks of understanding the issue. Certainly a major advantage of mediation is its reduced cost and time efficiency.

Another advantage is that the mediation process is not adversarial. The litigation process in Canada is adversarial: it places two parties in opposition to each other in order to test and arrive at the truth. The adversarial process can create a lot of bitterness. A mediation setting encourages discussion between the parties and encourages both parties to have input into the resolution, and so the damage to the relationship is much less.

Mediation is also beneficial because both parties have a role in creating the resolution. They have an investment in it and they are usually happy with the outcome because they have some control versus an outcome being imposed on them by a third party, such as a judge or an arbitrator.

Mediation is a win-win proposition whereas going to litigation is a win-lose proposition. In litigation, one party usually prevails and one loses, and the cost of the litigation goes to the victor. In mediation, both parties have an opportunity to come out as a winner, as long as they go there with an open mind and with a real view to resolving the dispute.

There are some other advantages as well. In mediation, the parties can control the outcome in a way that they cannot in a litigated solution. In litigation, both parties present their best case before the judge. The judge then makes a decision and at times that outcome might be very surprising. Also, mediation aims at encouraging the parties to put their interests, as opposed to their legal position, forward. Often in mediation you will find that a party may have taken a legal position throughout the dispute. This position is based on a legal entitlement but they haven’t explained what their real interest is behind that position. A mediator tries to understand what the underlying interests are. Once those interests come to the foreground, a resolution is usually a lot easier to achieve because now there is a mutual interest in resolving the dispute, not just in saving money or in some other hidden interests. The mediation process encourages the parties to put those interests on the table. That just does not happen in a litigation procedure, which is based on more technical legal positions.

The final benefit of mediation is confidentiality. Civil cases take place in an open courtroom, which means that all of the pleadings and all of the testimony is available to the public. Mediation can take place in a confidential setting and typically a mediated settlement will be confidential unless the parties agree otherwise. There are many situations in business where confidentiality has a high value. So that’s another significant advantage of mediation.

Mediation
Overcoming the disadvantages of mediation in business dispute resolution.
One of the real problems in mediation occurs when the parties have unequal bargaining power. This means one party is a lot stronger than the other.

In a business context, fairly typical situations would be ownership disputes, shareholder disputes, or partnership disputes. One shareholder may be the majority shareholder and also the one who controls the company’s board of directors and all of the resources. This party controls the bank account and can pay for legal fees through the company. As well, he has access to all of the company records and all the financial information about the business. In this situation, it is pretty tough to go in as a minority shareholder and mediate that dispute because of the complete lack of knowledge and negotiating power. One party is holding all the cards.

Mediation is least effective when one party stands to gain a lot and the other party only stands to lose a lot. Our approach is to use litigation to level the playing field because mediation works best when both parties go into the process in the same position: being able to lose the same amount.

Reasons for consulting a lawyer in a business dispute resolution.
It would be great if you could develop a computer program and put it up on the Internet to help people conduct business resolutions themselves. But in reality, there is tremendous skill required to use all of the tools that are available through the litigation process, the court, and mediation. Even choosing the right mediator requires skill in order to match the personality of the mediator with the parties involved. There are a lot of these intangible skills that a dispute resolution lawyer brings to the table in order to help the client resolve disputes more effectively than they could themselves.

A certain number of cases are straight forward, commercial debt for instance, and if the client has a relationship with the third party, the client could probably resolve that by picking up the phone and talking to the person who owes them the money about why they have not paid. Often I recommend that strategy. If it’s a straight forward dispute, then the client can proceed by himself and save the cost of hiring a lawyer. I will even give a prospective client a few tips. We do not typically get involved unless we both believe that legal representation can add some value to the process of resolving the dispute. A lawyer offers a combination of legal experience and business experience, all of which we have gained by resolving hundreds of business disputes.

The process of preparing a client for mediation in a business dispute.
We spend time with the client at the beginning, analysing the case, determining what legal rights and legal entitlements our client has. One way to increase the effectiveness of mediation is to use litigation to ensure that both parties are on equal terms at the outset. If one of the parties conducting the litigation has control of the company’s bank account and can pay for the company lawyer to handle the dispute, that party is going to be at a significant advantage over the party who, for instance, has been squeezed out of the business, has no income because he has been cut off from working at the business and has no access to company resources. We will start the litigation in order to obtain court orders that will level the playing field somewhat. For example, the court can order the other side to disclose all of the relevant documents through the document discovery process. Without litigation, that information may not be available. The person controlling all the key documents is often reluctant to release documents that would be helpful to the other side. We develop a plan at the beginning of the process in order to take a few steps in the litigation process to put our client in a strong position to negotiate. The mediation will be much more likely to succeed if our client is going in with full disclosure.

We also spend a lot of time having the client prepare a chronology of key events. At a certain stage, we will determine what witnesses and documents will be required to prove our client’s case. Once we have that material, we are in a position to mediate, but not before.

Sometimes we turn to expert witnesses, but we use them sparingly because they are very expensive. In certain cases, expert witnesses will be helpful. In business disputes, the main expert we use is a financial expert. Often, business disputes come down to accounting, so accountants are very helpful witnesses in determining the value of a business asset or determining what a business is worth. Business evaluation experts, who are accountants with a specialized designation in business evaluation, can be helpful in cases where the business is going to be split up. They can help determine what the value of that business is. Often the resolution is the process of bridging the gaps between the competing experts: one party’s expert says his value of assets is a million dollars and the other party’s expert values them at half a million or two million dollars. A big part of the job then is to get behind those evaluations and assumptions and find ways to bridge the gap between the two positions.

We are strong proponents of mediation and dispute resolution, but we also know that we have to use the court system as a strategic resource to level the playing field. There are all kinds of other ways you can resolve disputes, other than litigation, once both parties are on an equal footing

Scenarios that require the expertise of a lawyer to resolve a business dispute.
We are often required to assist with either a shareholder or partnership dispute, which is basically an ownership dispute. This would be an internal dispute between the owners of a business sometime after the business has been established. Such disputes are often the result of the lack of considered structuring at the outset of the business venture. Partners or joint venture participants often go into a business arrangement with a lot of enthusiasm but have not really taken the time to think about the future. Quite often when businesses are started, the partners are equal going in and no one has put any thought into the question of what happens if the two equal partners disagree on the direction of the business or on a particular decision to be made. If they are 50:50 owners of the partnership or 50:50 owners of the shares to the company, there is no easy way to resolve a deadlock. A lot of disputes arise from that scenario. The participants have not agreed on a proper structure for the business from the outset and later on when one partner decides he or she wants to leave and focus on other enterprises, a dispute arises about how to deal with that.

Another kind of dispute that business owners face involves a third party. This category includes a number of situations such as contract disputes; payment disputes where a third party fails to pay for the goods and services; and intellectual property disputes, where someone is using someone else’s intellectual property.

Ownership or shareholder disputes and third party disputes are the major categories of situations that arise in business and require dispute resolution services.

May 20, 2008, Case Management Conference

2008-05-23T15:40:00.000-07:00

On Tuesday, May 20, 2008, we appeared before Madame Justice Griffen, our assigned case management judge to discuss the next steps in the class action law suit.

After listening to our summary of the case, which the other lawyers both agreed with, Madame Justice Griffen directed the following:

(1) that the defendant’s motions to strike our pleadings pursuant to Rule 19(24) be set down for a 2-day hearing (it has now been scheduled for September 4th and 5th, 2008);

(2) that the defendants be required to deliver a full written legal argument well ahead of the hearing; and that plaintiff will have an opportunity to respond with its full written legal argument; and,

(3) that the plaintiff be entitled to bring its application to add or substitute the representative plaintiff at the same time the defendant’s motions are heard.

If the plaintiff succeeds in these motions the next step will be the plaintiff’s certification motion.

604-688-7385

2008-05-16T09:15:00.006-07:00

Ellis Business Lawyers - New fax number

(604) 688-7385

Let’s talk it out - Negotiation and Mediation

2008-04-15T10:45:00.007-07:00

Published in BC Roofing Magazine - Spring 2008

Negotiation and mediation better than court to solve business disputes

As a lawyer engaged in the area of business disputes, I have experienced a shift in my practice from traditional litigation towards more flexible, cost-effective approaches to settlement, such as mediation and negotiation.

Litigation is the process of pursuing a legal contest by judicial process that is ultimately decided by a third-party adjudicator, usually a judge. Litigation is often described as a “win-lose” process, or a “zero-sum” game, with one party prevailing in the end and the other losing. As any business owner that has been faced with lawsuit knows, litigation is expensive and often everyone loses, even the victor in the court proceedings, given the high cost of legal fees and the inevitable delays involved. Other approaches to resolving disputes, such as negotiation and mediation, are often described as “win-win” processes, where both parties to the dispute have a role in creating the solution. Although these processes are often referred to as alternative dispute resolution methods, or ADR, vastly more civil cases are ultimately resolved by negotiation and mediation than by adjudicated outcome. Indeed, it is widely acknowledged that only two percent of civil lawsuits that are initiated end up in trial.

“Many a litigation lawyer
has reached settlement
of a dispute on the courthouse steps
the day a trial is scheduled to proceed
or even in the courtroom corridor
after the case has commenced.”

What is important is the approach and attitude of the professionals involved. For example, does a lawyer actively approach a business legal dispute from the perspective of traditional litigation, or does he or she approach it from the perspective of solving a problem?

Negotiation
Negotiation can lead to a settlement at almost any stage of a legal process. Typically,
negotiations in legal disputes are informal and usually occur between the lawyers involved rather than the parties themselves. Many a litigation lawyer has reached settlement of a dispute on the courthouse steps the day a trial is scheduled to proceed or even in the courtroom corridor after the case has commenced. Yet, to achieve the real economic benefits of a negotiated settlement – reduced legal costs – it is incumbent on the parties to resolve their dispute at some earlier stage.

Mediation
Mediation is a process for facilitating settlement or agreement between two or more disputants and is facilitated by a mediator who is trained to encourage dialogue between the parties and uncover the underlying interests of the parties. In mediation, the parties themselves define the terms of their agreement rather than having a decision imposed by a third party adjudicator. Business owners are increasingly recognizing the many advantages of mediation processes versus traditional litigation paths.

Advantages of mediation:
The main advantages of mediation to small businesses are as follows:

Certainty of outcome: In mediation, the parties themselves control the terms of the settlement; nothing is imposed on them by a third party adjudicator. The mediator facilitates settlement but the parties make the final decisions. Mediation, therefore, eliminates the huge factor of uncertainty that is present in all courtroom trials, given that the final outcome in a trial is within the power of the judge and out of the control of the parties.
Focus on interests rather positions: Mediation focuses on the underlying interests of the parties and attempts to create solutions that meet those interests. Skilled mediators are adept at ferreting out hidden interests that, once dislodged, may facilitate settlement. For example, a party’s concern about the confidentiality of the terms of settlement, or concern about an ongoing business relationship with the other party may be significant factors in why a case will settle in mediation. By contrast, the court process is open and adversarial which often can damage business relationships.
More durable agreements: Mediations often result in more durable agreements because the parties themselves have negotiated the terms rather than having terms imposed on them by a third party. It is presumed that parties will have a greater investment in honoring their own terms versus those that are ordered by someone else.
Cost effective and faster: Perhaps the most important reason business owners choose mediation is that it is almost always less expensive than marching on with court proceedings. A typical civil case can take years before a final outcome at trial, and even after a successful trial outcome it can take months or even years to implement or collect on the judgment. By contrast, a mediated settlement can often be resolved in one or two sessions over a few days or weeks. And the terms of settlement can be implemented immediately. Litigation is expensive, despite constant efforts by the court system to streamline procedures. The benefits of litigation can often be outweighed by its costs.
Confidentiality: Unlike most court cases, which are matters of public record, most mediation is confidential. With the advent of the Internet, the final judgment in a court case is disseminated around the world the moment it is pronounced. The terms of a mediated settlement are confidential and do not leave the mediation room.

Click here to see article.

Meldon Ellis, BA, LLB is a business dispute resolution lawyer in Vancouver. His firm, Ellis Business Lawyers (www.ellislawyers.com) practices in the areas of commercial debt collection, and business and tax litigation.

How to survive costly disagreements.

2008-03-03T23:16:00.004-08:00

Financial Post article. Published March 03, 2008. How to survive costly disagreements. Lawsuits over contracts or leases can be crippling for SMEs. Read the article here.

Fishing for Freedom

2008-02-07T00:47:00.001-08:00

Meldon Ellis speaks at Fishing for Freedom public meeting re: Halibut Class Action Lawsuit, January 27th, Richmond Inn, Vancouver, BC and January 28th, Dorchester Hotel, Nanaimo. BC. BC Fisherman v. DFO Class Action Lawsuit blog.

DFO named in fishermen lawsuit.

2007-11-26T16:13:00.000-08:00

DFO named in fishermen lawsuit. Read the press release here.

EBL files Class Action lawsuit.

2007-11-21T14:29:00.000-08:00

Ellis Business Lawyers files Class Action lawsuit against the Federal Department of Fisheries and the Pacific Halibut Management Association. Read the Statement of Claims here.

EBL wins jugdement

2007-08-27T11:11:00.000-07:00

British Columbia Supreme Court issues decision in Livramento v. Millennium Powder Coating Ltd. EBL helps plaintiff obtain an audit and compensation for his shares in a shareholder oppression trial. * Read the full decision here.

Legal affairs

2007-08-15T15:24:00.000-07:00

EBL article published in Western Investor Magazine - June 2007
Click here to download article - or read it below.

Collecting bad debts
Whether to pursue a bad debt or not is a delicate commercial balancing act. As commercial debt grows in Western Canada, so should business owners’ awareness about bad debt preventive measures, as well as an understanding of effective collection processes.

Preventive measures
Keeping extensive, accurate documentation of transactions is a critical commercial practice. These documents not only provide clear initial notice of non-payment, but also strengthen any subsequent claims made against a debtor whether as evidence in court proceedings or just as supporting documentation to a letter of demand.

Early warnings
The following actions of the customer are often warning signs to a business that a bad debt is looming:

• Failure to return phone calls and correspondence;
• delaying tactics such as breaking promises to pay;
• disputing specifications only well after the invoice becomes due; and
• claiming financial difficulties without specifics.

Collection agencies
Once a creditor has exhausted their lines of communication with a debtor, a collection agency may be engaged on their behalf who will generally work to collect the debt on contingent fee basis for a percentage (often 50 per cent) of monies recovered. However, a large number of debtors will not respond to a collection agency.

The legal route
When a collections agency cannot persuade a debtor to pay, it may be time to consult a lawyer to analyze the pros and cons of filing a writ in Supreme Court (for claims over $25,000 in British Columbia) or a notice of claim in provincial (small claims) court (for claims under $25,000 in B.C.) excluding interest and court costs.

The small claims court system in B.C. has settlement opportunities, including mediation and a mandatory Settlement Conference before trial. These can be used to resolve claims much more quickly than Supreme Court procedures.

A creditor with a claim resting on the $25,000 threshold may want to consider waiving (or giving up) its incremental amount over $25,000 in order to file in provincial court and take advantage of the more cost-effective and efficient procedures.

Pre-judgment
In both levels of court, there are pre-judgment remedies that may leverage a debtor into paying before reaching the lengthy and costly trial procedure. These include:

Pre-judgment garnishing order: A garnishing order from the court allows a creditor to collect money owing to the debtor directly from a person (the ‘garnishee’) who owes money to the debtor.
Preservation of property: A creditor’s lawyer may apply for the detention, custody or preservation of property. Aside from securing the amount in dispute, this tactic may force a debtor into settlement discussions. The Rules of Court also allow for the appointment of a receiver to recover payment of debts from the debtor’s assets in certain circumstances.
Default and summary judgments: Once a claim is filed and served on the debtor, the debtor has a finite amount of time within which they must file a response. If there is no response by this deadline, the creditor may apply for default judgment against the debtor.
Other pre-judgment securities: If there is concern about the debtor having significant assets that may be disposed of, or taken out of the jurisdiction prior to judgment, interim orders can be obtained upon application to the court to prevent this. These options should be explored at the initial stages of deciding whether to file suit.

Going to trial
While the judgment of a court is a weapon against a debtor, it can often be a blunt weapon. There are a number of reasons that a creditor may wish to resolve its collection matter before reaching trial, including the following:

Diversion of time and resources of the creditor towards a court proceeding rather than the creditor’s daily business affairs;
lengthy delays before the matter is resolved;
no guarantee of outcome;
further delays before the debt is recovered after judgment;
delays caused by debtor relying on bankruptcy provisions to avoid payment; and
limited recoverability of the judgment debts.

Mindful of these potential difficulties, the best measures are preventive, but when collectors fail, it is time to call in legal team Lower Mainland creditor’s lawyer will assess whether going to trial is the most appropriate course of action.

The good news is that a court judgment will permit a creditor to enforce both pre- and post- judgment interest on the outstanding debt.

Getting paid
While obtaining a judgment does not guarantee payment of a debt, the advantage of receiving a court order is that the following enforcement options become available to the creditor once judgment is rendered:

Debtor examinations;
Debtor subpoenas;
Committal for contempt;
Execution against personal property;
Execution against real property; and
Post-judgment garnishment on any monies owed to the judgment debtor, e.g. wages.

Again, these procedures do not guarantee payment, but can exert significant pressures on the judgment debtor.

Statutory limits
A creditor must be aware that it only has six years from the date of the debt in which to bring an action in court against the debtor in B.C. In determining the date of the debt, it is safest to assume that the limitation period commences from the date that the payment became due as stipulated on the creditor’s invoice.

The unfortunate reality is that rarely will the creditor recover all of the expenses they incur in collecting a debt.

Conclusion
The bottom line is that it is always preferable to manage the accounts receivable to avoid or limit bad debts rather than allowing them to accumulate.

The burden is always on the creditor to prove the agreement and the debt, so there is nothing stronger than an organized system and proper documentation.◆

Meldon Ellis, BA, LLB, is a business dispute resolution lawyer in Vancouver. His firm, Ellis Business Lawyers (www.ellislawyers.com), practises in the areas of commercial debt collection and business and tax litigation. Phone 604-688-7374.

Ellis Business Lawyers - New Address

2007-08-15T12:05:00.000-07:00

New address and contact information for Ellis Business Lawyers.

#440-319 West Pender Street,
Vancouver, BC
V6B 1T3

T (604) 688-7374 or (604) 671-7374

2007-02-20T10:41:00.000-08:00

Today's post will highlight events in a recent B.C. Supreme Court trial inwhich Meldon Ellis represented the plaintiff, one of two 50% shareholders ina B.C. company.

During the trial, Mr. Ellis argued that the conduct the defendantshareholder, who also was the company’s sole director, was “oppressive”under the B.C. Business Corporations Act and that as a result of thisoppressive conduct the company should be dissolved and all its assetsdistributed to the shareholders. The oppressive conduct alleged by theplaintiff included the company’s failure to hold an annual general meeting(AGM) and its failure to provide the plaintiff with audited financialstatements. An AGM and audited financial statements are mandatory under theBusiness Corporations Act (the Act) http://www.qp.gov.bc.ca/statreg/stat/B/02057_00.htm
unless these requirements are waived byunanimous consent of the shareholders.

Mr. Ellis argued that there are two fundamental rights of every shareholderin a B.C. company: (1) to vote his shares at an AGM to elect a Board ofDirectors; and (2) to be provided with audited financial statements of thecompany. A company’s failure to meet these requirements, Ellis argued, is“oppressive conduct” under the Act and should lead to either a court-ordereddissolution of the company or other court-imposed remedies, such as a orderrequiring one of the parties to buy the others’ shares at fair market value.

The evidence presented at trial clearly established that the plaintiff hadnot received notice of any AGM (nor was any AGM ever held), had not receivedhis original share certificate and had not received audited financialstatements. The evidence also established that the plaintiff had worked inthe business for almost two years without compensation before he wassqueezed out by the defendant shareholder in 2002. Since that time, theDefendant had been paid over $150,000 in wages from the company, had enjoyedthe exclusive use of a company vehicle purchased and maintained by thecompany and had paid the lawyer representing him in the within litigationusing company funds.

The defendant argued that the simple failure to hold AGMs or to provideaudited financials cannot be considered oppressive under the Act, as theseare merely formal requirements. The defendant conceded at trial that theplaintiff was indeed a 50% shareholder in the company but he argued that theplaintiff should get less than 50% of shares because his initial cash contribution was about $10,000 less than the defendant. The defendantsubmitted that the plaintiff should only be paid back the amount of hisinitial capital investment in the company and that he should have nointerest in the company’s assets beyond that.

The court reserved judgment.

Ellis Business Lawyers: Website Completion

2007-01-26T13:23:00.000-08:00

The Ellis Business Lawyers website has now been completed. The website includes information about the two lawyers of the firm: Meldon Ellis, and Leslie Brunanski.

It can be found here:
http://www.ellislawyers.com

Moreover, Meldon Ellis' personal site can also be accessed here:
http://www.meldonellis.com

The law firm focuses on managing your legal issues in the most effective manner possible. We approach your situation from the perspective of a business owner and put our legal skills and experience to work for you to accomplish your overall business objectives. In addition to offering alternative dispute resolution strategies and advocacy we also frequently act for BC businesses in litigation matters, including contract disputes, tax litigation and shareholder actions.

We provide a range of British Columbia collections law services for both domestic and international clients including advice and legal representation in commercial debt collection and retail and consumer debt collection matters.

If you wish to contact Meldon Ellis: meldon@ellislawyers.com
If you wish to contact Leslie Brunanski: leslie@ellislawyers.com