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Does a Heter Iska Increase the Risk of Litigation?

Would an Ontario court enforce a Heter Iska? When a religious Jew lends another Jew money they often enter into an agreement called a Heter Iska. Faced with the biblical prohibition against charging interest on loans and the reality that lenders are more likely to lend people money when interest can be charged, the Rabbis created a halachic mechanism to still allow a lender to profit from the loan and not charge interest. This halachic document is called the Heter Iska. The Heter Iska characterizes the lender as an investor who provides capital for a business venture. The Heter Iska provides that the investor transfers ½ of the money as an interest-free loan, is to be repaid even in the case of total loss; the other ½ of the money is the investor’s share of the business venture, which entitles the investor to receive profit that not coincidentally is equivalent to the interest a lender would charge. Thus, at the end, the investor’s money would be returned, and any profits (or losses) would be shared. This halachic mechanism serves to ensure that Jews will not have a financial disincentive to loan one another money.
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Does A Constructive Trust Trump the Bankruptcy and Insolvency Act?

In the words of the Court of Appeal at paragraph 34, "those funds should be the subject of a constructive trust in favour of DSLC Capital Corp. in order to prevent the unjust enrichment of Credifinance Securities Limited." But, this is the end of the story. Let’s start at the beginning. DSLC Capital Corp. (DSLC) sought to invest in Credifinance Securities Limited (Credifinance) thinking that it was a member in good standing with the Investment Industry Regulatory Organization of Canada (IIROC). DSLC’s plan was to become a part owner of Credifinance so that DSLC could sell securities and other investments to its existing network of investors. Based on representations of the principal of Credifinance, DSLC loaned Credifinance $400,000 and, by share subscription agreement, proceeded to purchase a minority ownership interest in Credifinance.
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When Does The Limitation Period Clock Start Ticking?

In 2006 Ferrara clearly knew someone thought his lawyer, Stephen A. Schwartz, was negligent. Arguably Ferrara would have to sue Schwartz by 2008 or his action would be statute barred. The Ontario Court of Appeal concluded that the limitation period was not triggered until 2009 which meant that Ferrara had until 2011 to start the law suit. In making that decision there was a divergence from a group of cases that suggested that the limitation period would have been triggered in 2006. But, that’s the end of the story. Let’s start at the beginning and review the implications on the issue of discoverability.
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Cross-border issues: Israel and Canada

Ontario lawyers are increasingly establishing strategic alliances with Israeli attorneys to better serve their clients. Why? There are lots of reasons. Enforcement of Israeli court orders in Ontario, increased trade between the countries requiring cooperation between corporate and tax counsel, and families with members in both jurisdictions requiring cooperation in…

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Being Sued in Ontario

Americans sued in Ontario are at risk. Sometimes these defendants ignore Ontario law suits because they have no assets in Canada. That may be unwise. Ontario courts, under certain circumstances, will assume jurisdiction and grant judgments against American defendants.
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Enforcing Canadian Judgments in Israel

This article addresses the risks to Israelis being sued in Ontario, Canada. Sometimes there is a tendency for Israeli defendants to ignore Ontario lawsuits. Perhaps they feel judgment proof because they have no assets in Canada. That may be unwise.
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Who keeps engagement ring?

Marsha met Marc only 3 months ago. When she agreed to marry him she thought he was a wealthy entrepreneur. Instead, she found out that Marc only owned a small store and was barely making ends meet. When Marsha discovered her mistake she immediately started to date other men. After Marsha agreed to marry him, Marc gave her a $20,000 diamond engagement ring. Soon after Marc caught Marsha on a date with another man. He demanded that she give back the engagement ring. She refused. In her mind the engagement ring was a gift. Marc sued. Who do you think should get the ring? Let's see what the courts say.
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But I Incorporated…

Why do people incorporate companies? One of the main reasons is that generally, if a company does business, no employee or officer of the corporation is personally liable for any act within the scope of their duties on behalf of the corporation. Now, there are some exceptions to that general rule that could result in personal liability, even if the business is incorporated.
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