Sam the Record Man, Ethics and Higher Learning

The recent controversy over the Sam the Record Man sign, Ryerson University and the City of Toronto is interesting on a number of levels. There is the heritage aspect of the matter and there is the legal contractual element – Ryerson agreed to find a place to hang the sign, then decided that it didn’t want to do so.

Much has been written about the above.

What interests me personally, and as an adjunct professor at a law school, is the ethical element.

Ryerson is an institution of higher learning. It teaches students.

And so, call me old-fashioned, but I believe that such institutions should be held to a very high standard when it comes to honouring legal contracts.

We’ve entrusted these institutions with the minds of our youth – they are teaching the leaders of the future.

And so what do our youth see in the Sam the Record Man sign saga?

They see that institutions of higher learning, populated by really smart people, with really smart advisors can enter into contracts, then decide later that they don’t wish to be bound by them.

The take-away is that contracts are made to be broken.

That it’s OK to make deals – then break them when they no longer suit you.

Is that really the behaviour that Ryerson wants to model for its students?

Is that really the reputation that Ryerson wants at a time when it’s expanding and entering into contracts with many different entities? Are those entities now thinking about the risk of Ryerson reneging on, or renegotiating their deals?

Is this really a good reputation to have when pitching to be an LPP provider for Ontario law students which will include an ethics component?

The best clients I ever had were the straight-shooters – the ones who felt that their word was their bond. The ones who never reneged on a deal or attempted to renegotiate a deal. They lived with mistakes because reputation was more important than dollars.

Sadly, the youth of today are learning the opposite.


  1. The youth of today are learning about the doctrine of “efficient breach”, they just don’ t know it.

    After all, if it could be good enough for the SCC – see Bank of America Canada v. Mutual Trust Co., [2002] 2 SCR 601, 2002 SCC 43 at paras. 30-31, 61 – then it can be good enough for the public, right?

    On the other hand, maybe they’re learning that, as Humpty Dumpty said in a different context, the answer depends on who has power.

    On the third hand, what they’re not learning, as you’ve correctly said, is that there are times when doing what one is entitled to do just because it is legal (assuming that what Ryerson wants to do) isn’t the correct answer.

    Have a good day.

  2. Well worth saying, Ryerson’s behaviour in this has been reprehensible.

  3. David,

    One of us must be slipping up because I finally agree with you!

    Efficient breach however does not account for (possibly irreparable) reputational damage in a market where reputation drives student applications and attracts professors and research grants.

    Ryerson’s Board was asleep at the switch on this one.

  4. I’m also an Adjunct there, and I can say that I’ve seen a huge push to teach business ethics and ethical practice. It’s probably premature to say that the school deliberately broke a contract or agreement simply because it was beneficial to them.

    The Star has noted there were some health and safety concerns about the older sign which would actually necessitate that the school break any existing agreements in the interests of the students and the community. In addition to occupier’s liability there would also be pertinent obligations under the regulations to the Environmental Protection Act. I would be interested to see if an environmental assessment was held for the site, and what, if anything, was said about the safety of the sign.

  5. Depends on what one’s definition of damage is, doesn’t it? You and I agree Ryerson erred. As the article you linked to shows, others don’t.

  6. Mitch,

    There’s absolutely no reason why reputational damage cannot be quantified and included in an “efficient breach” analysis. It may be difficult, yes, but it’s not impossible. Just google quantifying reputational damage and you’ll see that there’s a wealth of material on the subject. I would agree, however, that many companies, organizations and institutions underestimate these costs for various reasons.

  7. Thanks David and LawGrad.


    If you are correct – then there has been a huge communications failure by Ryerson.

    Good board practice would have been to decide that the sign was a major health and safety concern – then craft a communications plan to ensure that everyone understood that this was not a decision based on money and that Ryerson was not reneging on the agreement – rather the decision was taken to protect the faculty and the student body.

    Did Ryerson drop the ball on communications? Or is this really about money?

    My bet is on the latter.

  8. Omar,

    You mean the Ryerson board is so incompetent that it was prepared to, and did, breach the contract without considering the consequences?

    We could be be naive and assume the board is so incompetent that it didn’t consult even a barely competent lawyer. I’m not. I’ve seen no indication here you are.

    Maybe they obtained advice that there wouldn’t be a breach if they did whatever it is they plan to do in a particular way.

    I rather doubt that advice would be be that certain, but there’s always the word “competent”.

    If we assume breach, I doubt that the board breached the contract believing the breach would damage Ryerson in whatever sense the board assigns to damage.

    It seems to me that the better assumption is that the board received legal advice on its options an that a decision was made that doing what it’s doing is best for Ryerson. That’s another way of saying: ” the school deliberately broke a contract or agreement simply because it was beneficial” to it.