Intersections

If you need a reminder about the glacial pace of Canadian litigation, look no further than the fact that a Sudbury mall recently won a case against Zellers. That's right, Zellers. The dispute was over a lease the company broke in 2004, which I've had the misfortune of realizing was before some first-year law students were born.

— Dylan Gibbs

• Judicial hallucinations?

• Drug decriminalization

• Intersectional equality

• $1.5M for a hyperlink

• Suing ChatGPT

STAYING CURRENT

1. Fixed-term contract bites a business purchaser

   FCAPEO v. Bouchard, 2026 BCCA 89

Joseph Bouchard sold his engineering firm, agreed to spend three years working for the purchaser, and signed a three-year non-compete. But the employer fired him early, and refused to pay out the entire contract. They argued Bouchard had a duty to mitigate by finding other work. But that’s not how the BC Court of Appeal saw it.

2. Good faith purchasers trump CRA’s deemed trust
   TD Canada Trust v. Canada, 2026 FCA 25

When a company doesn’t pay the taxes it’s supposed to be collecting from employees, the CRA gets a deemed trust over everything the debtor owns. But what happens if the debtor sells its property, and uses the sale proceeds to pay unsecured debts?

According to the Federal Court of Appeal, unsecured creditors who weren’t aware of the tax debt can rely on the bona fide purchaser defence and keep the money.

3. Google gets dinged over $1.5M for defamatory link
   A.B. c. Google, 2026 QCCA 157

Google refused to take down a link to a defamatory page about a Quebec businessman, citing the SCC's ruling in Crookes v. Newton that hyperlinking alone isn't "publication." But the Quebec Court of Appeal disagreed, saying that Quebec law obligates platforms to act once they know their services are being used for illicit purposes. And that meant Google's refusal to de-index after being told the content was false was an expensive misstep.

FROM OUR COMMUNITY

Mastering AI (and its implications)

The Inn Laws community has been full of AI chatter lately, which seems to be driven by two things.

First is the recent privilege ruling — where a US court said that running legal advice through tools like ChatGPT can waive privilege. Inn Laws members have been chatting about the implications in their peer groups, and sharing draft language they’re including in retainer agreements to warn clients about the risk.

Second, the tools are getting better. I try to be moderate about this stuff and shy away from the hype camp. But the improvements in AI over the past few months have marked a step change nearly as significant as ChatGPT’s debut. We’ve levelled up. And tools like Claude are now equipped with powers that feel like magic.

That’s why I’ve devoted much of my time recently to experimenting with these tools and showing Inn Laws members what’s possible for their law practices. I’m also building tools to help me run my own business — it’s win-win — but the part I’ve enjoyed the most is showing lawyers how to eliminate some of the work that drove me NUTS when I was practicing.

And their reaction has generally been surprise at how much is possible. One member, after a demo: "I'm getting stuff done, while still feeling smarter (or at least more nuanced) than the bots — for now."

Indeed. No one is replacing lawyers anytime soon. But we can sure equip them better.

If you’re looking to stay ahead of the curve and connect with other practitioners in a similar boat, our DMs are open.

SPOTLIGHT 🔦

Intersectional equality claim carries the day

Quebec v. Kanyinda, 2026 SCC 7 

What happens when a law doesn’t discriminate against an entire protected group, but effectively discriminates against a subset of that group? That’s what the SCC grappled with in its most recent decision, carving out a clear home for “intersectional” claims in the equality analysis.

A bit of context: Quebec's Reduced Contribution Regulation lists eight categories of parents eligible for subsidized daycare. Refugee claimants aren't one of them. For Bijou Kanyinda, who came to Quebec as a refugee in 2018 with three young children, that meant spending two years unable to access affordable daycare — and unable to work as a result.

Kanyinda argued the legislation violated her right to equality. The legislation applied equally to all women — and all refugees. But Kanyinda argued it was unconstitutional because of the impact on those at the intersection — women who are also refugees.

At the SCC: An eight-judge majority held that the legislation was unconstitutional — but they split across three sets of reasons. Justice Karakatsanis penned the lead judgment, holding that courts need to expressly consider intersectional equality claims. A law that appears to be neutral can still create a sex-based distinction where its effects fall disproportionately on a subgroup.

Here, women refugee claimants carry the greater share of childcare responsibilities — and the lack of affordable daycare was directly linked to their inability to work. That wasn’t the case for men.

On justification: Quebec argued the government was entitled to limit its subsidy to people with strong ties to the province. But since the government chose to subsidize international students, temporary residents, and work permit holders, that argument fell apart.

A gamut of views: Chief Justice Wagner would have gone further, recognizing refugee status as a protected ground and holding that governments can’t discriminate on that basis. Justice Rowe agreed with the outcome but took issue with the majority’s approach to intersectionality. And Justice Côté dissented, saying that the daycare rules didn’t violate the Charter’s equality guarantee (and would be justified even if they did).

Big picture: The majority decision officially incorporates intersectionality into Canadian equality law. For any benefits statute that excludes a defined class, the question is no longer just whether the exclusion maps onto a protected ground — it's whether it disproportionately burdens a subgroup defined by overlapping characteristics.

BY THE NUMBERS 📊

$3.6 billion: The final settlement in the Robinson-Superior Treaty annuities case, approved by Ontario’s Superior Court. It’s a bit shy of the $10 billion paid to First Nations under the Robinson Huron Treaty settlement in 2023, thanks to population differences and the value of the land covered by the treaty.

$20,000: The costs awarded against the Waterloo Catholic District School Board for reaching an "untenable" conclusion. The board sanctioned one of its trustees after an anonymous email alleged a conflict of interest — despite the board’s own independent investigator saying there was no basis for discipline.

$10: The maximum NSF fee banks can charge starting tomorrow, down from a typical $45–$48. The new cap, introduced through amendments to the Bank Act, applies to all federally regulated financial institutions.

MAKING HEADLINES

⚖️ OpenAI is facing a lawsuit over last month’s Tumbler Ridge shooting. Family members of a young girl still hospitalized by the tragedy allege the company knew about the shooter's plans and failed to notify police. They also allege ChatGPT unlawfully served as a de facto therapist for the shooter, who was also a minor.

📱 The federal government reversed course on TikTok. The company no longer has to wind down — but it will need to comply with new data requirements, including security gateways, enhanced protections for minors, and independent third-party monitoring.

🏠 Manitoba enacted a law giving individuals the right to request disclosure of a partner's history of domestic violence from police. Manitoba joins Alberta and Saskatchewan in adopting the disclosure regime.

💰 A law firm had to return $1.7 million to a former client. The Ontario Court of Appeal agreed with the client that a $3.5-million award secured by new counsel on appeal wasn’t covered by the original firm’s contingency agreement.

⚖️ Lawyers rallied at the Alberta legislature to protest the UCP government’s recent streak of applying the notwithstanding clause — and Premier Smith’s stated desire to “direct” judges.

⚕️ The Federal Court dismissed a judicial review challenging Canada's decision to end BC's drug decriminalization exemption early. The applicants argued the rollback violated Charter rights, but the Court said the government’s decision properly balanced competing concerns and there was no legitimate expectation that the exemption would last its full term.

🍷 Conservative MP Dan Albas introduced a bill to remove restrictions on interprovincial alcohol shipments to consumers. Canada Post currently can't deliver Canadian alcohol in six of ten provinces.

THINGS NOT TO DO 😤

Don't use AI to draft a $128-million fraud ruling

At least not without double-checking the citations.

As reported by La Presse, it sure looks like we have the first case of hallucinated case citations ending up in a judicial decision. The nearly 200-page decision includes reference to an SCC decision that doesn’t exist and a family law case cited in support of piercing the corporate veil.

The judge (understandably) hasn’t made a public statement explaining what happened, but the errors are exactly the sort of AI-driven issues we’ve been seeing from lawyers and self-reps in their submissions.

If confirmed, it would be the first instance of a judicial AI hallucination.

Be safe out there. And if you need help using AI properly, drop me a line.