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Over the recent times, the relationship between economic endeavors and the law has witnessed an upward mobility. According to Truman, the relationship between laws and economies is preliminarily based on the fact that laws help protect and govern the manner in which economic endeavors take place.
On the other hand, the economy provides the financial backing that is very vital in the process of creating, enacting and implementing laws that protect various individuals or organizations in the society.
As will be explicatively detailed in this paper, laws in countries are majorly divided into common laws and civil laws. Common laws, which are the central focus of this paper, are typical laws not enshrined in the law yet created to protect people beyond the confines of civil law.
There are many examples of common laws. However, in this study, we are going to locus on the law of torts with a legal case (Insurance Corp. of British Columbia v. Ben-Jaafar) being used to typify the intricacies of this law.
Essentially, the law of tort arose in this auto theft ring case where the conversion defendants (those who knowingly or unknowingly processed the stolen vehicles) and even went ahead to try to shield the court from finding the truth about the intricacies of the scheme.
So in as much as the fraudsters who stole the vehicles were mainly to blame (and were duly charged in the court); the honorable justice presiding in the case also extended the payment of damages incurred by Insurance Corporation of British Columbia to these conversion defendants. It is upon this background that the discussions presented herein will be given.
Brief Summary of the Case
According to the Canadian Legal Information Institute, the British Columbia’s Supreme Court is reported to have commanded fraudsters to repay hefty punitive damages to the Insurance Corporation of British Columbia (ICBC) for claims regarding an auto theft conspiracy by the fraudsters.
In a written statement by Justice Cullen who was presiding over the case, the fraud ring—which mainly consisted of thieves and forgers—stole vehicles the used forged Alberta Vehicle Registration Certificates (AVRC) to certify ownership of the vehicles.
In essence, using original documents of the stolen vehicles would make it easy for the vehicles to be spotted by the ICBC who had already compensated owners of these stolen vehicles. It is for this reason that the fraudsters’ cartel created new VIN numbers on the forged AVRC.
Once these documents were forged, the vehicles were then sold to new legitimate buyers in BC’s lower mainland and the money then shared amongst all the people involved in the scheme (Canadian Legal Information Institute).
Between 2002 and 2003, this cartel managed to steal several vehicles, make fake identification documents for them and sell them to their prospected buyers while making millions of shillings at the expense of innocent people and corporations.
However, the long arm of the law soon caught with the fraudsters resulting into one of the most monumental cases in Canada with the conspiracy and conversion defendants being on one of the court while the plaintiff government being on the other.
After an overstretched battle in the legal corridors and evidence given by various witnesses; the fraudsters were charged for damages to the ICBC.
In awarding the fines, the court considered factors such as the financial means of the defendants, criminal records of the defendant, cooperation of the defendants during the trials and hearings at the court, whether one was involved in a single or multiple crimes, and the nature of crime (was it planned or deliberate), among many other factors (BC Justice).
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But even more relevant to our discussion, some of the conversion defendants also found themselves being charged on the basis of the count of negligence with regards to the criminal activities of the car theft scheme. Also, those who, in one way or another, inhibited the court or the plaintiff from finding the truth regarding the fraudulent activities were duly charged by the court.
The section below gives an expansive analysis of this common law (tort), with special focus being on the Insurance Corp. of British Columbia v. Ben-Jaafar case.
Legal Research (Summary of the Law Relating to the Case)
Generally speaking, contract laws refer to the laws that are instituted to govern contracts. A majority of the contact laws are legally incepted and instituted.
However, there are also some contracts—especially in areas like social, economic, political and anthropology—where the laws used in the contracts are domestic and, therefore, have nothing to do with the well-defined national and international legal statutes.
This is what scholars commonly refer to as common law and civil law—where civil law refers to those laws that are legal laws enshrined in the statute of a country or region while the common laws refer to the laws which are typical of any society—and, in most cases, are not legally mandated like the civil laws.
As a noteworthy point, the common laws and civil laws differ from one country and region to another. It is for this reason that contracts signed between people from varying region tend to be complex and highly sophisticated.
However, it is commendable to state that the progress being made—especially due to globalization and economic progress—has greatly encouraged the formation of contracts by several multifaceted regions and countries.
A tort is a word, with a French origin, which simply means a “wrong” or civil wrong that is committed against someone else. Its main difference with other types of offences is that whereas other criminal offences are generally viewed as a breach of duty to the country; a tort is a breach of duty owed to someone else.
Examples of torts include slander, health accidents, auto accidents, conspiracies, environmental pollution among many others. In most modern countries, the standard measure of a tort is said to be negligence (Larson).
As for negligence, it generally refers to the failure to act diligently or the omission of responsible behavior when it is your primary duty to do so. Larson states the following three points as the weighing scale for negligence. Firstly, the plaintiff must prove unreasonable behavior of the defendant.
Secondly, the plaintiff must have evidence to show the he/she suffered some loss or damage and thirdly, there should be proof to show that someone failed to act carefully as any normal person would.
These are normally represented in four statutes normally referred to as the elements of negligence which are: duty of care, breach of duty, breach based on a proximate cause and finally, breach causing harm (Find Law).
There are fundamentally two basic forms of defense against negligence. First is comparative negligence which commonly refers to a legal defense that a plaintiff’s negligence is also viewed as a contributing factor in a case, and thus reduces the amount of damages the plaintiff recovers.
Second is the contributory negligence where a defendant is partially or fully held responsible for the damages even if the plaintiff might have contributed to the negligent act.
In the analysis of liability today, most countries tend to like the comparative negligence since it seems fairer and representative of the involvement of both parties as stated above.
However, in the discussions of this paper, the issue of comparative negligence will be avoided as it does not necessarily relate to the specific objectives of this paper and in fact did not actually apply in the Insurance Corp. of British Columbia v. Ben-Jaafar case.
As a key note, laws differ from one country to another. Therefore, in the discussions below, central focus is going to be on the nature of tort laws in Canada—especially those that specifically relate to the case at hand
In the bid to do a circumspective economic analysis of the law of torts, with regards to our current case, it is unavoidably necessary for us to begin by tracing the origins of the problem—or rather, the factors that duly contributed to the criminal endeavors of the fraudsters.
The 2008 global financial and economic crisis is one of the most devastating experiences ever witnessed in the business world (Bhushan). To most macroeconomics, the signs of this crisis were clearly written all over the world, but for some strange reason, most countries chose to hogwash these signs terming them as baseless and worthless (Truman).
As we now all know, the signs—which were repeatedly documented by many scholars in books, articles and innumerable tabloids—were, actually, true based on the impact that the crisis had, not just in Canada, but to the whole world with many economies plunging down and paving the way for the variant levels of poverty across the globe.
When we talk of the global and economic crisis, we generally refer to the slump of several economies across the globe in the final parts of 2007, the whole of 2008 and the starting parts of 2009 (Bhushan).
However, digging deep into the annals of history, we find that the even as early as the year 2000, an economic meltdown had already started taking place in various countries across the world—Canada being among them.
And since the meltdown was both financial and economic in nature, trade was greatly inhibited which, in turn, led to the downward spiral of economic output and loss of jobs. As a result, most people resorted into criminal activities so as to sustain their livelihood.
A good number of witnesses in the Insurance Corp. of British Columbia v. Ben-Jaafar case used the rather shaky economy of Canada, as of 2002 and 2003 to defend their direct or indirect engagement in fraudulent economic endeavors.
A good example of the above argument is that of buyers who said that unknowingly getting vehicles at a cheaper price from the fraudsters was considered as a huge economic gain for them since other places tended to sell similar vehicles at higher prices.
Another factor that duly contributed to the fraudulent activities was the legal and political landscape of Canada. Notably, since its inception in 1867, the Canadian constitution has undergone tremendous political changes that have transformed it from a power-centralized document to one that there is modicum separation of powers.
Primarily, the constitutional act—which was reinstated to law—gave formal authority to the Queen of Britain (Queen Victoria) and thus making Canada a sovereign, yet democratic, state. This is the main reason why Canada heavily borrows from the British system of governance (Lympany).
As of today, Canada is considered as a constitutional monarch and an independent federation that utilizes the parliamentary system of governance. In some aspects, the separation of powers in Canada has fuelled economic progress through the presence of democratic laws.
However, on the downside, some people have been affected negatively since the parliamentary systems vests a lot of control on top government officials rather than those at the grassroots—which makes it relatively easy for criminals to get away with their activities (Saunders).
This, probably, is the reason why the vehicle fraudsters unnoticeably got away with their criminal activities for over a year. It is however important to note that in order to protect the economic ventures of Canada, specifically related to the discussions of this paper; there exists 2 categories of tort laws which apply relevantly—as is exemplified below.
Firstly, Fridman says that there is the tort of civil conspiracy. Here, liability for an actionable conspiracy is covered under the Cement LaFarge where the following key elements are constituted:
- Any form of conspiracy is considered as an intentional tort. This majorly applies to parties who have mutually agreed to act in a particular way, for a particular purpose and with a particular intent (Fridman).
- An agreement to participate in a conspiracy is punishable by law. However, this agreement must have a plan to participate in “unlawful” conduct where the conspiracy has elements such as crime, tort, breach of statutes or breach of contracts (Fridman).
- There must be prove of damage for one to be considered as having engaged in a tortuous conspiracy with proofs from the plaintiff to ascertain the guilt of the defendants with regards to the damages in question (Fridman).
Secondly, we have the tort of conversion. Fridman says that, in this tort, the following elements are considered hugely vital:
- There must be a wrongful act by the defendant involving goods that belong to the plaintiff (Fridman).
- The wrongful act must consist of disposing, handling or destroying of the goods in question (Fridman).
- The wrongful act by the defendant must verifiably have the intention or effect of interfering with the plaintiff’s right to his/her goods.
If the court is able to prove guilt on the basis of these torts, then one is considered liable for the crime and punitive damages are administered based on the negative economic impact of the criminal activities by the defendants on the plaintiffs.
Remarkably, the liabilities and punitive damages given to the defendants in the Corp. of British Columbia v. Ben-Jaafar case were only administered once the court had exhaustively assessed their guilt on the basis of these torts and the aforementioned considerations such as nature of participation or even the defendants’ criminal records.
Below are the names of the main players in the car theft and sales ring, as well as the charges that were imposed on them—as per the reports of the Canadian Underwriter.ca.
- Vikram Atwal: Liable for an estimated amount of $113, 365 and damages amounting to $40, 000.
- Jaspal Atwal: Liable for an estimated amount of $22, 931 and damages amounting to $5, 000.
- Jasraj Bains: Liable for an estimated amount of $96, 510.04 and damages amounting to $40, 000.
- Jagjit Gill: Liable for an estimated amount of $68, 730.67 and damages amounting to $50, 000.
In total, the Canadian Underwriter.ca states that the British Columbia Supreme commanded the fraudsters to pay ICBC more than $344, 000 for damages that resulted from the auto theft ring.
Expectedly, these fines greatly helped ICBC to regain on the losses that had been incurred due to the criminal activities of the fraudsters. On the flipside, the corporations and individuals that were involved in the cartel witnessed a down-surge in their revenues based on the charges imposed to them.
Moreover, it is worth noting that the tort laws in Canada have provisions in which clients get to defend their cases.
It is for this reason that Vikram Atwal was found complicit of stealing and converting 7 vehicles while he had claims against 6 vehicles dismissed by the court; Jaspal Atwal was found complicit of stealing and converting 1 vehicle; Jasraj Bains was found complicit of stealing and converting 4 vehicles while he had claims dismissed against him in 1 vehicle; and Jagjit Gill was found complicit of stealing and converting 5 vehicles (Canadian Legal Information Institute).
It can thus be said that the law of tort not only helped in solving the economic problems for related to the case; something which went along way in encouraging economic progress.
Application of Economic Analysis to Case
As has been repeatedly detailed in the discussions above, the symbiotically mutual relationship between laws and economic endeavors is an important one that should be continually sustained rather than limited. For instance, in the Insurance Corp. of British Columbia v. Ben-Jaafar case, the tort laws greatly helped in solving the legal dispute between the plaintiffs and defendants.
On the other hand, it is extremely important that the economy is duly regulated so that the engagement into fraudulent endeavors is reduced while the prevalence of criminal activities is curbed. If such economic precautions had been taken, then the Insurance Corp. of British Columbia v. Ben-Jaafar case might have not even happened.
In conclusion, it is inherently vital to state that the Insurance Corp. of British Columbia v. Ben-Jaafar case not only helped in punishing the guilty parties while giving justice to the innocent individuals and corporations.
To this effect, it can be said that courts provide a good avenue for airing out our legal problems or even getting compensation for harms done to us.
However, if crime is to be uprooted or at least stemmed out, it is far much better that each one of us takes the short route of making a commitment to acting diligently and responsibly to avoid taking the long highway of legal justice.
The compensations given in courts merely act as a way of owning up to the mistakes but do not solve the deep-seated feelings of trauma and pain normally caused by certain crimes (whether committed negligently or knowingly).
Nonetheless, more legal provisions like tort laws should be continually developed and better to help protect our endeavors—whether social, political, cultural, environmental or even economic.
BC Justice. Insurance Corp. of British Columbia v. Ben-Jaafar. 2011. Web.
Bhushan, Aniket. Lessons from the Economic Crisis. 21 June 2011. Web.
Canadian Legal Information Institute. ICBC v. Atwal, 2010 BCSC 338 (CanLII). 2010. Web.
Canadian Underwriter.ca. BC’s Supreme Court Orders Hefty Punitive Damages in Auto Fraud Ring Case. 2011. Web.
Larson. Aaron. Negligence and Tort Law. 2003. Web.
Lympany, Dave. The Canadian Political System. 2006. Web.
Find Law. Contributory and Comparative Negligence. 2012. Web.
Fridman, Gerald Henry Louis. The Law of Torts in Canada, 2nd Ed. Toronto: Carswell, 2002. Print.
Saunders, Cheryl. Separation of Powers and the Judicial Branch. 2006. Web.
Truman, Edwin. M. The Global Financial Crisis: Lessons Learned and Challenges for Developing Countries. 2009. Web.