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On May 6, 2026, the Government of Canada introduced Bill C-31 which proposes amendments to the Canada Labour Code. Specifically, the proposed amendments, if passed, would prohibit the use of non-compete clauses in employment agreements and prohibits federally regulated employers from imposing non-compete clauses on employees in general.
Non-compete clauses are defined to mean a term or condition of employment, or a clause in an agreement, that prohibits an employee from engaging in any business, work, occupation or trade, profession, project or other activity that is in competition with the employer’s federal work, undertaking, or business after the employee ceases to be employed. Historically, the courts have taken a strict view of non-compete clauses and only permitted enforceability when the clause is reasonably restricted by term, geographic region, specific description of work, or limited to specific clients within a limited time frame. The proposed amendments to the Canada Labour Code go further to propose an absolute prohibition on the use of non-compete clauses by federally regulated employers.
The proposed amendments do provide for limited exceptions, which include:
Sale of business transactions, where the seller and purchaser enter into an agreement that contains a non-compete clause and the seller becomes an employee of the purchaser; and
Senior executive roles, including chief executive officer and those employees who report directly to the chief executive officer, including: chief operating officer, chief financial officer, chief human resources officer, chief information officer, chief technology officer, or chief legal officer.
The proposed amendments go further to prohibit an employer from dismissing, suspending, laying off, demoting, or disciplining an employee because the employee has refused to agree to or comply with a non-compete clause.
A transition period for the application of the proposed amendments is contemplated for existing agreements that include non-compete clauses.
The proposed amendments align with the legislation in force in Ontario. While Alberta has not moved to such legislation, federally regulated employers in Alberta are subject to the Canada Labour Code and these amendments. It will also be prudent to monitor activity in Alberta and other provinces for adoption of similar prohibitions on employers.
If adopted, federally regulated employers are advised to review existing employment agreements and terms of employment to address any non-compete clauses.Walsh LLP has expertise in assisting employers who are federally regulated and our employment law team is available to assist you with any questions you may have regarding this proposed amendment to the Canada Labour Code or any other employment law matters.
Article | Chad Erisman | May 25, 2026
Don’t Get Caught: Why and When Alberta Contractors Need a Prepaid Contracting Licence When Accepting Deposits
Are you a contractor who requires your clients to pay you a deposit before you provide work in Alberta? You May Need a Prepaid Contractor License
For many contractors, subcontractors, and trades, collecting a deposit before starting work is a prudent practice. Material costs, scheduling pressures, non-payment concerns, and cash flow realities often make upfront payments a necessity for a successful business.
The catch is accepting advance payment from certain customers may trigger licensing obligations under the Consumer Protection Act, RSA 2000, c C-26.3 (the “Act”) and under the Prepaid Contracting Business Licensing Regulation, AR 185/1999 (the “Regulation”).
Section 104(1) of the Act states that no person may engage in a “designated business” unless that person holds a license under this Act that Authorizes the person to engage in that business.
Section 102 (b) of the Act defines a “designated business” as “a trade, business, industry, employment or occupation to which this Part is made applicable by regulation under section 103.”
Section 103 of the Act, then enables the creation of regulations pursuant to the Act, including the Designation of Trades and Businesses Regulation, AR 178/1999 (the “Designation Regulation”) which, at section 5 (2) (c), defines “Prepaid Contracting” as “the activities of soliciting, negotiating or concluding in person, at any place other than the seller’s place of business, a prepaid contract.”
Fortunately, section 5(3) of the Designation Regulation, clarifies that the definition of “Prepaid Contracting” does not include contracts for the provision of services to Commercial Buildings, contracts between any two General Contractors, Subcontractors or Subtrades, contracts for the construction of a home where the contract is covered by the Alberta New Home Warranty Program or National Home Warranty Program, or contracts for the construction of a water well.
The result of the Act, the Regulation, and the Designation Regulation is that any contract for the provision of services to residential consumers which requires prepayment requires a Prepaid Contracting License from the Government of Alberta.
Applying for a Prepaid Contracting Business License
A Prepaid Contracting Business License can be obtained from the office of Service Alberta and Red Tape Reduction by completing the application form located on the Government of Alberta’s Prepaid Contracting License webpage currently located here.[1]
The Application is simple and only costs $78.00 per year, though it does require a $10,000.00 bond, which can be satisfied using a general surety bond, a cash security agreement, or an irrevocable letter of credit.
Risks of Non-Compliance
Failing to obtain a Prepaid construction license and continuing to offer Prepaid construction services to residential customers can result in contractors being subject to investigations, increased scrutiny from regulators, administrative penalties, regulatory charges, reputational damage, and potential civil liability.[2][3]
Penalties can reach several thousands of dollars with courts having the option to suspend business licenses or even impose imprisonment for serious repeat offenders.[4]
While the above consequences will generally arise where a contract between a contractor and residential home owner have gone wrong and a deposit has been paid, the Alberta Government has demonstrated a willingness to investigate and prosecute non-compliant contractors.[5]
In a widely publicized undercover sting operation[6] conducted in Calgary and Edmonton, Alberta government investigators posed as homeowners seeking renovation work. Contractors who accepted prepaid work without proper licensing were charged under provincial consumer protection legislation.
The Purpose of the Prepaid Licensing Framework
The Prepaid licensing framework exists primarily to protect homeowners from fraud, abandoned projects, and contractors taking deposits without completing work.[7]
While obtaining a Prepaid Contracting License may appear to be yet another administrative and financial burden imposed by the Alberta Government, the framework works to build trust in the construction industry by holding non-compliant operators accountable for their actions, while providing reputable contractors with another avenue to verify their reliability in the eyes of customers.
How Legal Counsel Can Help
Construction and renovation businesses often focus on completing projects and managing operations — not navigating complicated and often evolving regulatory requirements. Early legal guidance can help businesses avoid costly disputes and enforcement proceedings later.
At Walsh LLP we regularly assist contractors, subcontractors, and trades professionals with:
regulatory compliance reviews;
construction contract drafting and negotiation;
Consumer Protection Act matters;
contractor disputes;
debt recovery and collections;
litigation and regulatory defence; and
risk management strategies for residential and commercial construction businesses.
If your business accepts deposits or advance payments or wants to accept deposits or advance payments from residential customers, obtaining legal advice, before problems arise, may significantly reduce your exposure to regulatory and financial risk. To learn more about Alberta’s prepaid contracting license requirements, or to coordinate a contract review with a member of our legal team, please reach out to Chad Erisman or Locklyn Price at Walsh LLP.
Just as Bob Dylan wrote “The Times They Are A-Changin’” to capture, and transcend, the political preoccupations of his era, Canadian courts have increasingly adapted the common law to address new forms of harm arising in a digital age. Among those developments is the recognition of a civil tort of harassment in response to individuals using the internet to inflict reputational, psychological, and emotional harm.
Canadian common law has been grappling with how best to address Internet-based wrongs for some time (see Google Inc. v. Equustek Solutions Inc., Douez v. Facebook, Inc., and Uber Technologies Inc. v. Heller). These harms, including cyber-defamation and cyber-abuse, can attain international scope in a viral instant, exposing gaps in traditional legal remedies and raising novel questions about access to justice, jurisdiction, and accountability.
In 2021, Justice David Corbett of the Ontario Superior Court of Justice made a significant contribution to the evolution of civil remedies in the digital age by becoming the first judge to recognize the tort of harassment in internet communications in Caplan v Atas, 2021 ONSC 670.
The facts of the case are, in many respects, remarkable and were the subject of a lengthy New York Times article. However, the focus of this article is not the underlying factual circumstances, but rather the broader implications of the decision, and the subsequent jurisprudence recognizing the tort of harassment in Alberta.
The decision in Caplan v Atas concerned four related lawsuits brought against Ms. Atas for defamation, harassment, and other associated claims. From the outset, the decision makes clear that each action arose from an extraordinary factual matrix.
In the opening paragraphs, the Court described the defendant as having engaged in “extraordinary campaigns of malicious harassment and defamation” and, through the use of the internet, having been able to “disseminate vile messages globally, across multiple unpoliced platforms, forcing her victims to litigate in multiple jurisdictions to amass evidence to implicate her, driving their costs up and delaying the process of justice”.
Facts:
Ms. Atas was on the losing end of a mortgage enforcement proceeding. In its aftermath, she embarked on a years-long, systematic campaign designed to cause emotional and psychological harm to those against whom she bore grievances. The list of targets was extensive: adverse litigants, former employers, her family members, her own lawyers, and even a New York Times journalist.
The campaigns were both relentless and malicious. They included hate mail and online publications accusing victims of professional misconduct, pedophilia, sexual criminality, and even the abuse of a recently deceased family member. Justice Corbett described cyberstalking as Ms. Atas’ “perfect pastime,” observing that she appeared to derive satisfaction from the legal process and the unending conflict it produced, relishing the expense, delay, and emotional toll imposed upon her targets. In striking terms, the Court remarked that “her lack of empathy is sociopathic.” The internet was her weapon of choice.
Observations:
Justice Corbett characterized Ms. Atas’ conduct as occupying a “grey-zone” between civil and criminal law, conduct sufficiently harmful and persistent to resemble criminal wrongdoing, yet carried out through mechanisms that rendered conventional civil remedies ineffective.
While compensation is ordinarily the primary objective of the civil justice system, that goal had limited utility in this case given Ms. Atas’ insolvency. Instead, the Court shifted its focus toward deterrence and prevention, seeking both to address the underlying motivations for such misconduct and to create practical impediments to its continuation. The emphasis, therefore, was not merely on compensating victims, but on restraining conduct that existing remedies had proven incapable of meaningfully curbing.
Ontario Recognizing the Tort:
Justice Corbett described the prevalence of online harassment as “shocking,” noting that approximately 31% of Canadian social media users reported experiencing harassment in 2016. Further, online harassment poses a double threat: it violates the legal rights of its victims and has a significant impact on mental health.
While the need to address the phenomena was clear, Justice Corbett identified a potential obstacle: the Ontario Court of Appeal’s 2019 decision in Merrifieldv Canada (Attorney General), where the Court declined to recognize a standalone tort of harassment, finding that the tort of intentional infliction of mental suffering was sufficient.
However, the Court of Appeal did leave an opening:
“while we do not foreclose the development of a properly conceived tort of harassment that might apply in appropriate contexts, we conclude that Merrifield has presented no compelling reason to recognize a new tort of harassment in this case.”
Justice Corbett seized that opening and, on the facts before him, found such a compelling reason.
In Alberta
The legal framework in Alberta has evolved differently. In Boychuk v Boychuk, 2017 ABQB 428 (“Boychuk”), the Court stopped short of formally recognizing an independent tort of harassment, but implicitly acknowledged the underlying right in granting injunctive relief.
After reviewing the jurisprudence addressing harassing, intimidating, threatening, and violent behaviour, Justice Viet turned specifically to the issue of harassment. At paragraph 37, Justice Viet observed:
“a superior court must stay within the ambit of the legislation and, in Alberta, that legislation is based on the existence of violence [speaking of Protection Against Family Violence Act in Alberta]. However, a superior court has inherent jurisdiction and is not limited to any statutory standard; it is entitled, and indeed expected, to administer equity, i.e. to do what is fair as between litigants. The rights of citizens include not only the right to live in safety but also the right to be free from vexatious or harassing conduct.” [clarification added]
Justice Viet answered the question, “Do citizens have the right to be free from vexatious conduct by another?”, in the affirmative. In doing so, she relied in part on A.T.C. v N.S. 2014 ABQB 132, where the Court recognized that judicial intervention cannot remain confined to traditional concerns of physical safety and property damage, but must also respond to reputational and relational harm:
“Accordingly, while I accept that the law is generally that restraining orders and EPO’s are only granted in cases of fear for personal physical safety or fear of property damage, this Court’s jurisdiction today must be more encompassing than its common law historical development, and as well it must go beyond its present statutory limits. As such, in circumstances such as the present one, it is only necessary for the Court to determine that the parties genuinely do not get along and are a threat to each other, not necessarily in terms of their personal safety or property damage, but also in terms of the damage that can be done to their reputations and lives.”
Ultimately, Justice Viet granted injunctive relief pursuant to section 8 of the Judicature Act, which empowers the Court to grant any remedy it considers just.
Together, these decisions signaled a growing judicial willingness to address harassing conduct in a more structured and principled manner. Building upon that foundation, the law in Alberta evolved incrementally and through remedial innovation before ultimately crystallizing into the formal recognition of the tort of harassment.
In Ford v Jivraj, 2023 ABKB 92, the Court dealt with a breakdown of a personal relationship that evolved into allegations of harassment and reputational harm, including online communications and the indirect dissemination of damaging material. The litigation arose in the context of competing applications for restraining orders, followed by allegations of contempt arising from breaches of those orders.
The Court upheld and enforced broad restraining provisions aimed at preventing further contact, communication, and dissemination of harmful content. Although the Court did not formally ground its analysis in an independent tort of harassment, relying instead on its equitable jurisdiction to restrain abusive conduct and enforce compliance through contempt, Justice Graesser made clear that the common law was moving in that direction:
“I feel compelled to say that I am surprised by the pushback on the development of this potential tort. I fail to see what competing interests or rights need to triumph over an individual’s privacy interests, as opposed to their being a reasonable balance.”
And later:
“In my view, it is time for the civil law to catch up to the Criminal law and recognize harassment as a tort.”
That progression culminated in Alberta Health Services v Johnston, 2023 ABKB 209, where the Court was directly confronted with whether a tort of harassment exists in Alberta. The defendant had engaged in a sustained and highly public campaign of online attacks, threats, and intimidation directed at public officials, including statements described as malicious, abusive, and conspiratorial in nature.
In addressing that issue, Justice Feasby considered the state of the law in Ontario, particularly the Court of Appeal’s decision in Merrifield v Canada (Attorney General), which declined to recognize a tort of harassment, and its uneasy coexistence with the lower court’s recognition of a tort of internet harassment in Caplan v. Atas.
Justice Feasby observed, similar to Justice Graesser in Ford v Jivraj, that these authorities are difficult to reconcile. If a general tort of harassment does not exist, it is conceptually problematic to recognize a narrower, technology-specific variant of that same tort.
Justice Feasby explained:
“The idea that there is no general tort of harassment but there is a narrower tort of internet harassment makes no sense. If there is a tort of internet harassment but not a general tort of harassment, that means that the mode of harassment – using the internet – determines whether harassment is actionable. While internet harassment is a problem, so too is old-fashioned low-tech harassment.”
Against that backdrop, Justice Feasby took the next doctrinal step. He formally recognized the tort of harassment in Alberta and, in doing so, articulated a structured framework for liability. To establish liability, a plaintiff must prove that the defendant:
engaged in repeated communications, threats, insults, stalking, or other harassing behaviour, whether in person or by other means;
knew or ought to have known that such conduct was unwelcome;
engaged in conduct that would impugn the plaintiff’s dignity, cause a reasonable person to fear for their safety or that of their loved ones, or foreseeably cause emotional distress;
and caused harm.
In recognizing the tort of harassment, Justice Feasby emphasized that the Court was not creating indeterminate liability or opening the floodgates to routine interpersonal disputes. Rather, it was giving doctrinal structure to what Alberta courts had already been doing for years through restraining orders and equitable remedies. As Justice Feasby explained:
“Taking this step does not create indeterminate liability nor does it open floodgates; to the contrary, it defines the tort of harassment in a measured way that will guide courts in the future.”
Conclusion
Much like Bob Dylan’s observation that the times “Are A-Changin’,” the law has proven itself capable of adapting to the evolving nature of harm in a hyperconnected world.
As the internet reshapes the ways in which individuals interact, communicate, and, at times, inflict harm upon one another, the common law has demonstrated a corresponding capacity to evolve in response to new realities.
What began as a judicial response to internet-based wrongdoing, where individuals could spread lies, harass others, and inflict mental or emotional harm with apparent impunity, often beyond the reach of traditional legal remedies, exposed a gap in the existing legal framework that demanded intervention.
Courts are no longer confined to indirect, piecemeal, or purely equitable responses; they now possess a defined cause of action capable of addressing the realities of both modern and traditional forms of harassment.
Choosing an Executor of your Will – Things to Consider
Congratulations! You’re here – which means you are thinking about updating your Will, completing a Will, or you’re reading this article to affirm what you already have in place.
Gone are the old days, where being appointed Executor is viewed fondly as an honour. While an executor appointment signifies your implied trust and confidence in the person appointed, the realities are that your Executor with have certain obligations and responsibilities relating to your Estate when the time comes.
So – how do you choose the right person? Here are some factors to consider:
What will your Executor be responsible for?
An Executor is responsible for reviewing your Will, contacting beneficiaries, identifying your assets, ensuring estate liabilities (including tax returns) are paid, and reporting to beneficiaries before estate assets are distributed.
You will want to choose someone who can carry out these tasks and follow the distribution instructions in your Will.
What type of assets do you own?
Review the type of assets do you own and consider the steps that will be needed to get them to transferred to your beneficiaries.
Do you have assets that may require additional attention (such as corporate assets or assets outside of Alberta), and if so, will the person(s) you are appointing be able to handle the administration of those assets (or retain the right help to administer these assets)?
Who are your beneficiaries?
While in many situations, it can make sense for a beneficiary to be your Executor, there may be reasons why naming a beneficiary would not be advisable.
Examples include: when an Executor may be placed in a potential or perceived conflict of interest with the estate administration (such as appointing children as executors where a spousal trust or sibling trust is involved), or if the appointment of an individual (to the exclusion of others) would create discord in family dynamics.
Intentional and careful drafting can help to anticipate, minimize, and mitigate potential conflict between your Executor(s) and beneficiaries.
How long is the administration of your Estate (or the trusts in your Estate) anticipated to be?
Are there any trusts in the Will (for your spouse, children, grandchildren, or nieces/nephews)? If so, will the Executor be responsible for administering these trusts, or will you be naming someone else to be the trustee?
Where is your Executor located?
For estates in Alberta, Executors who are not residents of Alberta are subject to a bonding requirement. While the Court can waive this requirement, it may make sense to appoint someone resident in Alberta instead, if that option is available. Executors who are non-residents of Canada may also trigger additional tax reporting obligations and liabilities for the Estate, so it is important to review these considerations with an estate planning lawyer if they are relevant to your Will.
Review your choice of Executor regularly!
Review your Executor appointments regularly – a Will can be changed at any time while you are still alive and have capacity to provide instructions.
Life happens and circumstances change, for both you and the Executor who you have appointed. Reviewing your Will regularly will ensure that when the time comes, you have the right person in charge.
If you are looking to have your Will reviewed, revised, or completed for the first time – you are welcome to contact us to set up an appointment to discuss:
Ontario Court of Appeal confirms employers must prove availability of comparable employment, not merely criticizing the Plaintiff’s job search efforts.
In the recently decided case of Williamson v. Brandt Tractor Inc., 2026 ONCA 272, the Ontario Court of Appeal reinforces a critical limit on the “failure to mitigate” defence in wrongful dismissal cases: employers must do more than criticize an employee’s job search and failure to mitigate their damages; they must prove that comparable employment actually existed.
In this case, the employer argued the employee failed to mitigate by not pursuing similar sales roles. The Court rejected that argument outright. It confirmed that an employer bears a two-part burden:
the employee failed to take reasonable steps to seek comparable work; and
comparable employment was available such that the employee could likely have secured it.
On the facts, neither party provided evidence of available comparable positions that existed during the claimed notice period. That gap was fatal to this argument by the employer. The employee’s decision not to pursue sales roles did not relieve the employer of its burden.
What this Means in Practice
The duty to mitigate remains a cornerstone of wrongful dismissal law. Employees must take reasonable steps to find new, comparable employment to mitigate their damages following dismissal. However, Williamson underscores that mitigation is not judged in a vacuum:
Employees only need to pursue employment opportunities that are truly comparable.
Employers must support their own lack of mitigation argument with evidence that comparable alternative employment existed (e.g., job postings, market data).
The Court may not accept speculative claims about what “might have been available.”
Why it matters for Alberta Employers
Although this is an Ontario Court of Appeal decision and not binding in Alberta, it is likely to be persuasive. Going forward, Alberta courts may adopt this same evidence-driven approach and employers engaged in wrongful dismissal litigation should operate cautiously by collecting and producing evidence of alternative comparable employment in case this same approach is adopted in Alberta.
It can be easy to delay estate planning, including the preparation of a Will, Personal Directive and Power of Attorney. Given the complexities of business assets, Albertans with private businesses can face greater challenges to put their estate affairs in order.
What are the key estate planning documents?
The main estate planning documents are the Will, Personal Directive and Power of Attorney, which are described in greater detail below:
Will – a testamentary document appointing a “personal representative” to pay off debts and distribute property on death. It can include the appointment of guardians for minor children and testamentary trusts for children, dependent adults, or beneficiaries.
Personal Directive – an incapacity document appointing an “agent” to make decisions about matters related to health care, living arrangements, social involvement, and end-of-life matters.
Power of Attorney – an incapacity document appointing an “attorney” to make decisions about matters related to personal and real property, including dealing with Alberta Land Titles, investment decisions, tax filings, and funding for family or personal care.
What happens if I pass with a business?
If you could die while owning a business, a number of questions should be answered when preparing your estate planning documents:
1. What is my transition plan?
Owners may or may not have a detailed transition plan for their business on death. You may wish to transition to a key employee, family member or conduct a third-party sale. Having properly drafted estate and corporate documents are a must.
If you pass with a business in your estate, your Will should address bequests of business assets, including depreciable property, inventory, real property, partnership interests or corporate shares. If you have a family member involved in the business, you may contemplate a specific distribution of assets to your successor.
If the plan involves a corporation with multiple shareholders, a properly drafted unanimous shareholder agreement (“USA”) with detailed buy-sell provisions can ensure a smooth transition between current and future owners. An “estate freeze” can also be a useful tool to bring in a key employee or family member, providing fixed value equity for existing shareholders and growth to new entrants.
Family circumstances like maintenance and support (or property) obligations to a spouse, adult interdependent partner (AIP), or dependent child should be clearly identified and fit within the broader plan.
2. Should the business be sold?
In some cases, business owners will not have a transition plan for an employee or family member. In these situations, a sale of the business to a third party can be a prudent option. Alternatively, a reorganization of the business to isolate “active” operating assets from “passive” investment assets to enhance flexibility can be useful. Proper planning is required in both contexts.
Given the complexities of a business sale or reorganization, it may be advisable to arrange a transaction(s) during the lifetime of the owner to allow the owner to maintain control over the process. If an estate sale or reorganization is contemplated, appointing an institution (trust company) or sophisticated personal representative to handle the transaction(s) can ease the administrative burden on family members.
3. What are the tax implications?
There are many tax considerations to keep in mind when Albertans pass with a business.
Firstly, all capital property (including depreciable capital property) of the taxpayer is deemed to be disposed of at death at fair market value (subject to certain exceptions).[1] In the case of Albertans owning private corporations, capital gains and dividend taxation can create the potential for double tax (see our article on this topic, here).
Other rules related to business assets include, but are not limited to:
Application of capital gains “rollovers”, including the spousal (and spousal trust) rollover and family farm rollover to defer any capital gains tax.[2]
Rollover of class 14.1 depreciable property (goodwill) to defer capital gains on business with “going concern” value.[3]
Use of “rights or things” election on certain items (which if realized or disposed of would have been included in income of the taxpayer) including declared but unpaid dividends, unpaid salary or commission, and cash basis farming inventory.[4]
If a partnership is involved, review any tax implications including potential wind-up of the partnership, allocation of income, and disposition of interests on the death of a partner.
Tax planning opportunities involving corporate USA buy-sell provisions, including the use of corporate owned life insurance to fund the buyout of the deceased partner.
Finally, certain tax exemptions or credits can be applied in an estate context. Eligibility for the lifetime capital gains exemption on qualified small business corporation shares or shares in a family farm corporation or an interest in family farm partnership should be considered.[5] Further, the use of donation tax credits can be considered to defray income and capital gains in the estate.[6]
In all cases, advice should be sought to determine tax implications and to develop a proactive contingency plan.
Conclusion
Owning a business is complex and multifaceted. When planning for your estate with business assets, proper planning should be contemplated and advice sought. You’ve spent years building your business; spending the requisite time to plan your transition and estate plan will be well worth the time.
For more information, please contact Eric Dalke at edalke@walshlaw.ca / 403-267-8454 or any member of our Walsh Tax & Estates team and we would be happy to answer your questions.
Note: This article is of a general nature only. Laws may change over time and should be interpreted only in the context of particular circumstances. These materials are not intended to be relied upon or taken as legal advice or opinion.
[1] Subsection 70(5), Income Tax Act, RSC 1985, c 1 (5th Supp) (“ITA”).
[2] Subsection 70(6); Subsection 70(9) and (9.2), ITA.
For years, ESG (Environmental, Social, and Governance) was pitched as the inevitable future of corporate governance, promising to reshape how companies operate, disclose, and allocate capital. Today, that narrative is less certain. In the United States, ESG has become overtly political. In Canada, the shift is quieter, but notable: regulators appear to be cautious, progress is incremental, and investor enthusiasm measured.
This tension is especially visible in Canada’s energy sector, as new pipeline developments, Arctic and Northern projects under federal review, and ongoing resource expansion highlight the challenge of aligning ESG ambitions with economic realities.
I. Canada’s Incremental Approach
Canada has avoided the US-level of ideological polarization surrounding ESG, but it has also avoided fully committing to ESG as a unified legal regime.
Instead, ESG has been integrated, rather unevenly, into existing structures:
Canadian Securities Administrators have proposed climate-related disclosure requirements;
The Office of the Superintendent of Financial Institutions has introduced climate risk expectations through Guideline B-15; and
Regulators continue to align with the Task Force on Climate-related Financial Disclosures.
At the same time, the Competition Bureau has signaled increased scrutiny of environmental claims, reinforcing that ESG-related disclosures must meet traditional standards of accuracy and verifiability.
This approach reflects a preference for incrementalism over transformation. ESG is not being imposed as a distinct legal category, but rather folded into disclosure, governance, and risk oversight frameworks that already exist.
The result is pragmatic, yes, but also somewhat indeterminate. ESG in Canada lacks the coherence of a single regulatory regime, raising questions about whether it meaningfully changes legal obligations or simply reframes them.
II. The Energy Sector and Structural Tension
The Canadian energy sector provides a useful lens through which to assess ESG’s practical limits.
Canada remains economically dependent on oil and gas, even as ESG frameworks emphasize decarbonization and transition risk. This creates a persistent tension between market reality and regulatory direction.
Energy companies must now assess asset viability, disclose transition risks, and detail governance processes around climate issues. On one hand, enhanced disclosure may improve transparency and allow markets to price risk more effectively. On the other, it introduces challenges including forward-looking assumptions about regulatory and technological change, uncertainty in asset valuation, and potential constraints on capital formation in emissions-intensive sectors.
From an energy law perspective, ESG does not resolve these tensions so much as surface them more explicitly, often without offering clear guidance on how they should be reconciled.
III. The Question of Legal Novelty
One of the more underexplored aspects of ESG is how much of it is genuinely new.
Canadian corporate law has long allowed for consideration of stakeholder interests. In BCE Inc v 1976 Debentureholders, the Supreme Court of Canada confirmed that directors may consider a range of factors, including environmental considerations, when acting in the best interests of the corporation.
Many ESG-related risks are already addressed through disclosure, misrepresentation, and competition laws. For instance, the increasing attention from the Competition Bureau to potential “greenwashing” reinforces this point. The issue is not the absence of legal tools, but the application of existing ones to new forms of disclosure.
This raises a legitimate question: does ESG meaningfully expand legal obligations, or does it largely repackage established principles under a new label?
IV. Rebranding ESG as Risk
Recent developments suggest that the latter may be closer to the mark.
The terminology of ESG is gradually giving way to more familiar legal and financial concepts:
ESG strategy becomes risk management;
sustainability commitments become disclosure considerations; and
This shift may reflect a recognition that ESG, as a broad and sometimes ambiguous framework, is difficult to operationalize within legal systems that prioritize clarity and enforceability.
By contrast, concepts like risk, disclosure, and fiduciary duty are well understood. Reframing ESG in these terms does not eliminate its substance, but it does anchor it more firmly within existing doctrine.
At the same time, this rebranding arguably narrows ESG’s scope. What began as a wide-ranging framework encompassing environmental, social, and governance concerns is increasingly filtered through the lens of financial materiality and investor protection.
Conclusion
In Canada, ESG in the energy sector illustrates tensions it cannot fully resolve, between competing priorities such as competing decarbonization goals and market dependence, and between disclosure requirements and uncertainty.
ESG may ultimately prove less transformative in practice than what it hoped to achieve ideologically, but that does not render it irrelevant. Rather, it suggests that its influence will be more incremental, operating within, rather than fundamentally altering, the existing architecture of corporate and energy law.
Whether this practical reality represents a maturation of ESG or a limitation of its ambitions remains an open question.
Contact Us for Assistance
Walsh remains well positioned to assist clients in navigating this evolving landscape. As ESG considerations continue to be integrated into existing legal frameworks, we advise on climate-related disclosures, risk management, governance practices, and regulatory compliance, including in the energy sector. Our approach is practical and business-minded: helping clients meet emerging expectations while managing legal risk and maintaining operational flexibility in an increasingly complex environment.
Article | Carmelle Hunka | December 23, 2025
Alberta Extends Long Term Illness and Injury Leave
Effective January 1, 2026, employers must provide a longer period of long term illness and injury leave to their employees.
The Alberta government has made a substantial change to the Employment Standards Code, increasing the maximum period of long term illness and injury leave from 16 weeks to 27 weeks per calendar year. This change brings the length of this job- protected leave into alignment with other Canadian provinces, including British Columbia, Ontario and Saskatchewan.
To qualify for long term illness and injury leave, employees must have completed at least 90 days of employment with the same employer and must provide a medical certificate confirming the need for the leave due to illness or injury. Employers are not obligated to pay employees during this leave but are obligated to reinstate employees to their previous position or an equivalent one after the leave.
As a result of this extension of the period of long term illness and injury leave, employers are encouraged to review their policies and procedures to ensure compliance with this new legislative requirement. The Employment Law team at Walsh LLP is ready and available to assist.
Employment Team
Carmelle Hunka and Brody Sikstrom
Article | admin | December 2, 2025
Cost Series: Settlement Practices in Alberta: Understanding the Cost Consequences (Part 5)
Settlement offers play a crucial role in civil litigation by enabling parties to resolve disputes without resorting to trial. In Alberta, settlement offers can be made under the common law via Calderbank offers or as formal offers governed by the Alberta Rules of Court, Alta. Reg. 124/2010 (“ARC”). While both avenues are designed to encourage early resolution, they diverge significantly with respect to procedural formalities, legal effect, and cost consequences.
Common Law – Calderbank Offers
Originating from the decision of the English Court of Appeal in Calderbank v. Calderbank, [1976] Fam. 93 (Eng. C.A.)[“Calderbank”], a Calderbank offer is term used to describe a settlement proposal made pursuant to the common law. While historically framed as an offer made “with prejudice as to costs,” the modern articulation of this phrase has evolved to the current formulation ,which settlement offers are tendered on a “without prejudice except as to costs” basis.
The purpose of a Calderbank offer is to promote settlement while preserving the offering party’s ability to rely on the offer in support of a subsequent costs award, should the matter proceed to trial or adjudication.
While Calderbank offers are not governed by the ARC, they remain influential in the Court’s exercise of its broad discretion regarding costs. A party who unreasonably rejects a Calderbank offer, where the offer was objectively reasonable and its rejection resulted in unnecessary litigation, may be subject to adverse cost consequences.
Calderbank offers are a well-established and effective mechanism for preserving a party’s entitlement to enhanced costs in circumstances where a Rule 4.24 Formal Offer is either impractical or procedurally inappropriate.
The salient features of Calderbank offers include the following:
Absence of Automatic Cost Consequences: Unlike formal offers under the ARC, Calderbank offers do not trigger the cost-shifting presumptions codified in Rule 4.29.
Application of Traditional Contract Principles: Counteroffers operate to extinguish the original offer, and an offer may be revoked at any time prior to acceptance unless consideration is provided to keep it open.
Flexible Form of Communication: Offers can be made through letters, emails, or informal discussions.
Strategic Utility: Time-limited offers can create pressure for settlement.
Utilizing the Alberta Rules of Court to Settle
Relying on the ARC, Formal Offers are governed by Rule 4.24 of the ARC and engage the cost consequences delineated in Rule 4.29. These rules establish a more structured framework that incentivizes early resolution by attaching specific cost implications to the rejection of reasonable offers. The essential features of formal offers under the ARC include:
Formal Requirements of Form and Service:
Offers must be made in accordance with Form 22 and properly served on the opposing party; and
The offer must remain open for acceptance for at least two months or until the commencement of the hearing, whichever occurs earlier.
Restriction on Withdrawal:
Unlike Calderbank offers, formal offers may not be withdrawn unilaterally. Court approval is required to withdraw a formal offer once it has been served.
Cost Consequences Pursuant to Rule 4.29:
Plaintiff’s Offer: Where a plaintiff’s offer is rejected, and the plaintiff subsequently obtains a judgment equal to or more favourable than the offer, the court may award the plaintiff double costs from the date of the offer onward; and
Defendant’s Offer: Where a defendant’s offer is rejected and the plaintiff obtains a judgment less favourable than the offer, the defendant may be entitled to costs from the date of the offer forward.
Strategic Advantages:
Formal offers encourage parties to engage in meaningful negotiations at an early stage, and deter unreasonable litigation conduct through the threat of adverse cost consequences; and
The court retains discretion to decline enforcement of cost penalties where the offer was not a genuine compromise or was otherwise unreasonable in the circumstances.
Court Retains Discretion
When parties exchange settlement offers, whether as formal offers pursuant to Rule 4.29 of the ARC or as Calderbank offers, the courts retain discretion to consider these offers in the assessment of costs. A formal offer to settle that is not accepted, and is ultimately more favourable than the judgment obtained, may entitle the offering party to “double costs” under Rule 4.29 of the ARC, subject to judicial discretion. Although not automatic, this rule creates a rebuttable presumption in favour of such an award, thereby encouraging litigants to make reasonable settlement proposals and to seriously consider those received.
Comparative Analysis
Feature
Calderbank Offers
Formal Offers (Rule 4.24)
Authority
Common law – contract
Alberta Rules of Court
Cost Consequences
Discretionary (via Calderbank principles)
Defined and presumptive under Rule 4.29
Withdrawal
May be revoked at any time before acceptance
Requires court permission to withdraw
Effect of Counteroffer
Terminates original offer
Does not terminate original offer
Flexibility
Highly: oral or written
Must be in writing using prescribed form
Court Consideration
Considered as part of litigation strategy
Engages presumptive costs consequences
Conclusion
Settlement offers, whether made at common law or pursuant to the formal structure under the ARC, constitute powerful instruments within the litigation process. Common law offers offer flexibility and strategic value, particularly where informality is preferred or formal compliance is impractical. By contrast, formal offers create a defined procedural regime with the potential for substantial cost consequences, thereby incentivizing parties to assess the risks of continued litigation.
In determining which approach to adopt, litigants and counsel must consider a range of factors including procedural posture, litigation strategy, risk tolerance, and the likelihood of success at trial. Above all, parties must remain cognizant of the cost implications that may arise from either making or rejecting a settlement offer, particularly where such offers are objectively reasonable and consistent with the principle of proportionality.
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Over the past several decades, successful litigants have routinely argued that Schedule C of the Alberta Rules of Court does not adequately reflect the true costs of litigation and have sought enhanced costs awards as a result.
As discussed in our prior publications on costs (see Parts 1, 2, and 3 of our Costs Series), the Court retains broad discretion in determining an appropriate costs award following a trial or application. While Schedule C provides a standardized framework for partial indemnification of legal fees and disbursements, it often fails to capture the full financial burden borne by a litigant engaged in contested proceedings.
Historically, Alberta courts applied Schedule C in a relatively rigid fashion. However, the Alberta Court of Appeal’s decision in McAllister v Calgary (City), 2021 ABCA 25 (“McAllister”), marked a significant shift from that approach.
In McAllister, the trial judge declined the plaintiff’s request for an award representing 40-50% of his actual legal fees and instead awarded costs under Column 3 of Schedule C in the amount of $70,294.70. This figure stood in sharp contrast to the plaintiff’s total legal fees of $389,711.78. On appeal, the Court of Appeal held that Schedule C is only one of several methods available for assessing costs and cautioned against its routine and uncritical application. The Court confirmed that trial judges may, in the exercise of their discretion, award 40-50% of reasonably incurred legal fees, provided that the fees were properly incurred and no aggravating or mitigating factors are present.
The rationale underlying the Court’s departure from Schedule C in McAllister was its conclusion that Schedule C did not adequately reflect the reasonable and necessary costs incurred by Mr. McAllister in the litigation. The Court reaffirmed that the central consideration in deciding whether to depart from Schedule C remains whether the costs claimed by the successful party constitute “reasonable costs, reasonably incurred.” A departure from Schedule C must therefore be justified by exceptional circumstances, such as the complexity of the matter or misconduct by one of the parties during the litigation process.
Two years later, following in the wake of McAllister, the Alberta Court of Appeal further refined this analytical framework in Barkwell v McDonald, 2023 ABCA 87 (“Barkwell”). Building upon the principles articulated in McAllister, the Court reaffirmed that judges retain broad discretion to award “reasonable and proper costs,” which may be calculated under Schedule C, as a lump sum, or as a percentage of the legal fees incurred. The decision in Barkwell provided additional clarity for litigants regarding the framework governing lump sum and percentage-based costs awards.
Importantly, the Court in Barkwell clarified that the frequently cited 40-50% guideline is not necessarily tied to the actual legal fees paid by the client. Rather, it reflects what legal costs would have been reasonably incurred in the circumstances of the case. Although the Court acknowledged that the prevailing “rule of thumb” suggests that an award of costs should typically fall within 40-50% of the legal fees incurred by the successful party, it emphasized that this benchmark must rest on an objective assessment of what fees were reasonable, rather than what amounts happened to be paid.
The Court also emphasized that proportionality remains the overarching consideration in any costs award. A party seeking a lump sum or percentage-based award must demonstrate that the costs claimed are both reasonable and proportionate, having regard to the circumstances of the case. This assessment must be guided by the factors enumerated in Rules 10.2 and 10.33 of the Alberta Rules of Court, including the importance and complexity of the issues, the nature and extent of the legal services provided, the conduct of the parties, counsel’s rates, and the manner in which the legal work was performed. The Court reiterated that success in litigation, while relevant, cannot justify an excessive or disproportionate award of costs: “success is not a justification for disproportionate litigation.”
The decision in Barkwell further reinforced the procedural expectation that a draft Bill of Costs based on Schedule C should be provided, even when a party seeks an elevated or percentage- based award. Schedule C continues to serve as a foundational reference point that enables the Court to assess whether the quantum of costs claimed is both reasonable and proportionate. In Barkwell, the trial judge erred by awarding 50% of the respondent’s legal fees without undertaking a sufficiently rigorous inquiry into the reasonableness of those fees or engaging with Schedule C. The Court of Appeal stressed that McAllister does not authorize percentage- based awards in the absence of a principled and analytical framework.
Conclusion The decisions in McAllister and Barkwell represent a meaningful evolution in the jurisprudence governing costs awards in Alberta. While Schedule C remains the starting point for assessing costs, the courts have shown a growing willingness to depart from its strict parameters where circumstances justify enhanced compensation. McAllister confirmed the availability of costs awards representing 40-50% of reasonably incurred legal fees as a general guideline, while Barkwell clarified the evidentiary and procedural foundations required to support such awards.
Going forward, counsel seeking elevated costs must ensure that their submissions rest on compelling arguments supported by a proper evidentiary foundation, as articulated by the Court of Appeal. Absent adherence to these principles, efforts to obtain enhanced costs are unlikely to succeed.
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