Legal glossary

Resolving disputes outside court, most commonly through mediation or arbitration.

Also called: ADR, Mediation, Arbitration

The founding document filed with a government registry that legally creates a corporation.

Also called: Certificate of Incorporation, Incorporation Documents

Transferring a lease to another business, typically requiring the landlord's consent.

Failing to perform an obligation the contract requires, without a lawful excuse.

The law governing commercial electronic messages, requiring consent, identification and an unsubscribe mechanism.

Also called: CASL, Anti-Spam

A contract to occupy business premises, generally with far fewer statutory protections than a residential tenancy.

Also called: Net Lease, Triple Net Lease, Office Lease

Something of value exchanged by each side, which a contract generally needs to be enforceable.

When an employer unilaterally makes a fundamental change to a job, the law may treat it as a termination even though nobody said "you're fired".

A loan to a startup that converts into equity on a future financing rather than being repaid in cash.

Also called: Convertible Debt, SAFE

The exclusive right to reproduce and adapt an original work, arising automatically on creation.

The internal rulebook governing how a corporation is run day to day.

Also called: By-laws, Bylaw No. 1

The legal separation between a corporation and the people who own or run it.

Also called: Piercing the Corporate Veil, Limited Liability

A formal written notice setting out a claim and what is required to resolve it before litigation.

Also called: Letter Before Action, Cease and Desist

The reduction in an existing shareholder's ownership percentage when new shares are issued.

Also called: Anti-Dilution, Cap Table Dilution

A director's legal obligation to act honestly, in good faith, and with the care a reasonably prudent person would exercise.

Also called: Fiduciary Duty, Duty of Loyalty

The pre-trial stage where parties exchange relevant documents and answer questions under oath.

Also called: Examination for Discovery, Disclosure

A legal obligation to adjust workplace rules or conditions for protected grounds, up to the point of undue hardship.

Also called: Human Rights Accommodation, Undue Hardship

Provincial and federal statutes setting minimum employment entitlements that a contract cannot reduce.

Also called: ESA, Employment Standards Act, Canada Labour Code

A clause stating the written contract is the complete agreement, displacing earlier discussions and drafts.

Also called: Merger Clause, Integration Clause

Registering a corporation to carry on business in a province other than the one it was incorporated in.

The choice between incorporating under the federal CBCA or under a single province's corporations act.

A clause excusing performance when defined extraordinary events make it impossible or impractical.

A document a franchisor must give a prospective franchisee before signing or taking money, in provinces with franchise legislation.

Also called: FDD, Franchise Disclosure

Registering to collect and remit federal sales tax, mandatory once revenue passes the small-supplier threshold.

Also called: GST, HST, Sales Tax Registration

A clause choosing which jurisdiction's law applies and often where disputes must be heard.

Also called: Choice of Law, Jurisdiction Clause

A promise by one party to cover specified losses or claims suffered by the other.

A legal classification determined by the actual working relationship, not by what the contract calls it.

Also called: Misclassification, Dependent Contractor

Being unable to pay debts as they come due, or having liabilities exceeding realisable assets.

Also called: Bankruptcy, BIA, CCAA

Permission to use someone else's IP on defined terms, without transferring ownership.

Also called: Licence Agreement, IP Licence

A work permit category letting a multinational move certain staff to a related Canadian entity without an LMIA.

Also called: ICT

A federal assessment confirming that hiring a foreign worker will not negatively affect the Canadian labour market.

Also called: LMIA

The deadline for starting a lawsuit, after which the claim is generally barred no matter how strong it is.

Also called: Statute of Limitations, Limitation Date

A clause capping how much one party can be required to pay the other if things go wrong.

Also called: Liability Cap, LoL

An umbrella contract setting the standing legal terms, with individual projects added as separate statements of work.

Also called: MSA

The official record of a corporation's existence: articles, bylaws, resolutions, registers and share certificates.

Also called: Corporate Records Book

An author's personal rights to be associated with their work and to protect its integrity.

A clause restricting where and for how long a departing worker may compete with a former employer.

Also called: Restrictive Covenant, Non-Competition Agreement

A contract restricting how confidential information shared between parties may be used and disclosed.

Also called: NDA, Confidentiality Agreement

A clause preventing a departing worker from approaching a former employer's clients or staff for a period.

Canada's federal private-sector privacy law governing personal information in commercial activity.

Also called: Personal Information Protection and Electronic Documents Act, Federal Privacy Law

A time-limited exclusive right over a new, useful and non-obvious invention, granted on application.

A promise by an individual to pay a company's obligation if the company does not.

Information about an identifiable individual — broader than most people assume.

The obligation to report a security breach that creates a real risk of significant harm.

Also called: Data Breach Reporting, Real Risk of Significant Harm

An initial period during which an employer may assess suitability, sometimes with reduced notice obligations.

A separate provincial sales tax charged in provinces that have not harmonised with the federal GST.

Also called: PST, QST, RST

Quebec's modernised private-sector privacy regime, with stricter obligations than PIPEDA in several areas.

Also called: Law 25, Bill 64

The notice period a court may award on dismissal without cause, often well beyond the statutory minimum.

Also called: Common Law Notice, Pay in Lieu of Notice

The official address where a corporation receives legal documents and keeps required records.

A creditor holding a security interest in specific property, giving priority over unsecured creditors.

Also called: PPSA, Security Interest, General Security Agreement

A statutory payment owed on termination in some jurisdictions, separate from notice.

A category of shares carrying a defined set of rights — typically to vote, to receive dividends, and to share in assets on wind-up.

Also called: Common Shares, Preferred Shares

A contract among shareholders setting out how they will run the company and what happens if someone leaves.

Also called: SHA, Founders Agreement

A reduced federal corporate tax rate on a limited amount of active business income for Canadian-controlled private corporations.

Also called: SBD, CCPC Rate

The document that starts a lawsuit, setting out the facts alleged and the relief sought.

Also called: Notice of Civil Claim, Pleading

A document describing the specific deliverables, timeline and price for one engagement under a master agreement.

Also called: SOW, Scope of Work

Ending employment for reasons other than serious misconduct, which requires notice or pay in lieu.

A right to end a contract without the other side having done anything wrong, usually on notice.

Commercially valuable information kept confidential, protected by secrecy rather than registration.

A sign — a word, logo, or other mark — that distinguishes your goods or services from others.

Also called: Trade-mark, Brand Protection

A shareholder agreement signed by all shareholders that can transfer some or all of the directors' powers to the shareholders themselves.

Also called: USA

A ceiling on the valuation at which a convertible instrument converts into shares.

A schedule under which shares or options are earned over time rather than granted outright.

Also called: Cliff, Reverse Vesting

Work created by an employee within their job duties, where copyright generally belongs to the employer by default.

Authorisation for a foreign national to work in Canada, usually tied to conditions on employer, role or location.