Friday November 21, 2014

The not so fine line between ethics and crime


Oh, those pesky door-to-door salespeople. Direct sellers have a reputation for the hard sell, with good reason. It is a hard sell to take your product to people, who, before you showed up on their doorstep, had no idea they were in the market (and probably aren’t, not really) for the thing you’re selling. Unless it’s Girl Guide cookies, of course, everybody wants those whether they know it or not.

Last week, the City started getting calls from citizens who had been approached by someone selling security systems door-to-door and, according to the callers, had been told the City of Yorkton had “endorsed” the company.

The City took it seriously enough that officials felt it was necessary to put out a public service announcement to make Yorkton’s policy clear.

It read, in part:

“Please be aware that the City of Yorkton does not endorse any individual company or person selling any products in the city.

“The City is required to sell a business license [sic] to any company that meets the requirements of the Provincial Direct Sellers legislation, but will never endorse one licensed [sic] company over another.”

There are some interesting elements to this story, such as the fact the Province mandates municipalities to issue licences in this way, but what makes it pertinent to the Crime Diary?

There is no question such alleged tactics are unethical, but it is, in fact, a crime under the federal Competition Act to make misrepresentations such as the one described above.

According to the competition bureau:

“Section 52 of the Act is a criminal provision. It prohibits knowingly or recklessly making, or permitting the making of, a representation to the public, in any form whatever, that is false or misleading in a material respect. Under this provision, it is not necessary to demonstrate that any person was deceived or misled; that any member of the public to whom the representation was made was within Canada; or that the representation was made in a place to which the public had access. Subsection 52(4) directs that the general impression conveyed by a representation, as well as its literal meaning, be taken into account when determining whether or not the representation is false or misleading in a material respect.”

The Supreme Court of Canada underscored the importance of “general impression” test in Richard v. Time, 2012 (paraphrasing is by the legal firm Canadian Advertising & Marketing Law):

“The general impression test … must be applied from a perspective similar to that of ‘ordinary hurried purchasers’, that is, consumers who take no more than ordinary care to observe that which is staring them in the face upon their first contact with an advertisement.  The courts must not conduct their analysis from the perspective of a careful and diligent consumer. … In sum, it is clear that … the ‘general impression’ test … is the impression of a commercial representation on a credulous and inexperienced consumer. … courts view the average consumer as someone who is not particularly experienced at detecting the falsehoods or subtleties found in commercial representations.”

Clearly, there is no more “ordinary and hurried purchaser” than someone confronted with a direct seller on their doorstep. And clearly, as evidenced by the number of calls City Hall received, the “general impression” was that something was not right. And clearly, it was false in a “material respect” because the City went to great lengths to disavow the claim.

We tend to think of these unsolicited intrusions into our personal lives as a nuisance—with the exception of the aforementioned Girl Guides, whose only claim is that their cookies are delicious, which I can attest to from personal experience (except the mint ones, but only because I don’t like mint).  

Make no mistake, however, if someone comes to your door claiming the City has endorsed his company, a crime is being committed.



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