11 Questions
What was the ruling on a shareholder's right to demand a poll at a meeting?
It was a breach of duty by the chair owed to the company, not to individual shareholders.
What was the consequence of courts allowing personal actions by shareholders against directors and officers?
It created confusion over what actions were derivative.
What was the outcome of the reports on corporate law in the UK and Canada?
They led to statutory responses.
What was the primary issue with the approach to shareholder remedies?
It was unclear and created confusion.
What was the exception to the rule in Foss v. Harbottle?
A limited set of exceptions that allowed for suits by shareholders.
What is a characteristic of a shareholder's personal right?
It can be exercised without permission from the company.
What was the result of the courts' approach to shareholder remedies?
It created confusion over what actions were derivative.
What is the term for a shareholder who begins a lawsuit on behalf of the company?
Derivative claimant.
What is an example of an exception to the rule in Foss v. Harbottle?
A personal action by a shareholder against a director.
What is the term for a lawsuit brought by a shareholder on behalf of the company?
Derivative action.
What is the term for a shareholder who is treated unfairly by the company?
Oppressed shareholder.
Study Notes
- Stakeholders in a corporation have various mechanisms to address breaches of their rights or fiduciary duty breaches by directors and officers.
- Canadian corporate statutes typically include statutory remedial provisions to address grievances.
- The statutory derivative action is a remedy that allows stakeholders to address breaches of fiduciary duties by directors and officers.
- The oppression remedy is a statutory provision that provides relief to stakeholders who have been oppressed by the conduct of directors, officers, or shareholders.
- The appraisal remedy is a statutory provision that allows shareholders to dissent from certain corporate actions and receive fair value for their shares.
- Compliance orders, rectification, and investigation are other remedies available to stakeholders under Canadian corporate statutes.
- The historical development of stakeholder remedies in Anglo-Canadian company law is complex and inconsistent.
- The statutory derivative action requires leave of the court, and the court grants leave if there is a reasonable case on the face of the facts and the action appears to be in the interests of the corporation.
- Courts have shown a willingness to disregard shareholder ratifications of conflict of interest transactions where the interested party voted as a shareholder.
- The oppression remedy was enacted to address difficulties faced by minority shareholders in challenging abuses by majority shareholders.
- The oppression remedy allows stakeholders to seek relief for conduct that is oppressive, unfairly prejudicial, or unfairly disregards their interests.
- The oppression remedy is not limited to shareholders and can be used by creditors and other stakeholders who have been negatively affected by the conduct of directors, officers, or shareholders.
This quiz covers the mechanisms by which stakeholders can address breaches of their rights and fiduciary duties by directors and officers in a corporation. Topics include statutory remedies and grievance procedures in Canadian corporate law.
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