Countrywide and Thomas Morrissey - Part 1
Last July, 2007, Rita Daly, a feature writer for the Toronto Star, wrote two articles about Thomas Morrissey and Countrywide Maintenance Systems.
The purpose of my short article, which is part 1 of a three part post, is to explain the legal relation between Morrissey's alleged actions and how section 52 of the Competition Act, which prevents misleading advertising might be used to assist this group of individuals to seek justice.
In her articles, Ms. Daly writes that
"Twenty-one individuals and families, tracked down by the Star, told near-identical stories of how they answered an employment ad, signed a contract with Countrywide, paid the business up to $12,000 for the promise of steady work, then lost their investment."
Only one small group has had success in suing Mr. Morrissey personally.
"Last week, Morrissey was again in court fighting a refund claim. He filed a notice of appeal after a Brampton small claims court judge this month ruled he was "personally liable" for a couple's loss of $9,630 paid with a Visa card in 2005 for cleaning jobs they never got.In his ruling, Justice Ian Latimer said Morrissey "negligently misrepresented" the way his group of companies operates, noting the husband, Premkumar Seenivasagam, has difficulty understanding English and was not told that while one Countrywide corporation was signing him up, another was getting his money and was obliged to find him cleaning work.
"The facts of this case cry out for relief as it would be unfair and unjust if Countrywide Systems and Morrissey could wash their hands of the entire affair," Latimer wrote."
But summarizing the majority of cases, Daly writes
"No law seems able to protect them. Since the bankruptcy in 2002, people have complained to Ontario's consumer protection branch, labour relations board, Industry Canada, the Better Business Bureau and Toronto and Peel Region police. The typical response: go to court."
"Gabrielle-Roy helped [...] other unsecured creditors with a view to proceeding with a class action. "Suddenly all these other cleaners came out of the closet with their stories," she said.Together they wrote to government agencies, convinced some regulatory body ought to investigate further.
"I have a long list of people we contacted: the Ontario ministry of consumer and business services (now the Ministry of Government Services), the federal Competition Bureau, the fraud unit at Peel Regional Police. We contacted them all and wrote them nice letters," Gabrielle-Roy said.
"The response was always the same: There is nothing we can do, there's nothing we're going to do, there's nothing that can be done."
Is there really nothing to be done? These individuals believe that they have been lied to as members of the public, by Thomas Morrissey, who is indirectly promoting his own business interests, about the service to be provided by the contractors.
According to the allegations in the story, which I will accept only for the purpose of this legal analysis,
a) individuals pay $10,000 or more to obtain employment services from Company A, they wish to obtain cleaning jobs.
b) Company A has a business relationship with Thomas Morrissey.
c) Morrissey directly or indirectly promotes Company A's supply of employment services to the public, in part by directly or indirectly representing that the jobs are guaranteed and the fee is refundable.
Now compare these facts to what section 52 of the Competition Act states,
52. (1) No person shall, for the purpose of promoting, directly or indirectly, the supply or use of a product or for the purpose of promoting, directly or indirectly, any business interest, by any means whatever, knowingly or recklessly make a representation to the public that is false or misleading in a material respect.Proof of deception not required
(1.1) For greater certainty, in establishing that subsection (1) was contravened, it is not necessary to prove that any person was deceived or misled.Permitted representations
(1.2) For greater certainty, a reference to the making of a representation, in this section or in section 52.1, 74.01 or 74.02, includes permitting a representation to be made.
Does the use of the term "product" limit section 52 to only those cases in which misleading claims about ordinary products as opposed to services?
We have to turn to the definition of product in the Act, which states
“product” includes an article and a service;
We have therefore made out a prima facie case that if the facts as alleged can be proven, then there is a violation of section 52, which provides for criminal penalties for making or allowing to be made misleading advertising to the public.
Tomorrow, the next post will be about how this group, or any like it, should approach the Competition Bureau. Hint: letter writing is not effective.
