Question 1

A unanimous shareholder agreement is an agreement that defines the relationship among people who have an ownership interest in a corporation.

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Question 2

Identify and briefly explain the factors that a court must consider when setting fines or imposing other penalties on a corporation found to be responsible for the commission of a criminal offence.

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Question 3

In assessing a claim for oppression,a court must,among other things,determine whether the evidence supports a reasonable expectation of the stakeholder.

Accepted Answer

In assessing a claim for oppression, a court must determine whether the evidence supports a reasonable expectation of the stakeholder. This means that the claimant must have a reasonable expectation of receiving benefits from the company or entity in question, and if the evidence supports this expectation, then a claim for oppression may be successful.

Question 4

Briefly discuss statutory derivative actions,including what they permit and what is required for their commencement.

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Question 5

Identify and briefly explain the amendments enacted by Bill C-45 to the level of fines that may be imposed on a corporation under Canada's Criminal Code,as a result of a positive finding of that corporation's criminal liability.

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Question 6

The existence of the derivative action remedy means that directors are unable to treat the corporation as their own personal fiefdom with impunity.

Accepted Answer

The derivative action remedy enables shareholders to bring a legal action against directors on behalf of the corporation for breaches of duty, thereby holding them accountable for their actions and preventing them from using the corporation for their personal gain. This deters directors from treating the corporation as their own personal fiefdom and provides a mechanism for enforcing good governance practices.

Question 7

A shareholders' agreement is an agreement among all shareholders that restricts the powers of the directors to manage the corporation.

Accepted Answer

A shareholders' agreement is a document that outlines the rights and responsibilities of shareholders in a corporation. It does not restrict the powers of the directors to manage the corporation. Instead, it may address issues related to the transfer of shares, dispute resolution, shareholder voting rights, and other matters that affect the relationship between shareholders.

Question 8

In assessing a claim for oppression,a court must determine (i)whether the evidence supports the reasonable expectation of the stakeholder,and( ii)whether the reasonable expectation of the stakeholders was violated by the oppressive conduct.Identify the factors that must be considered by the court in order to answer both of these questions.

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Question 9

Briefly discuss the oppression remedy.Identify the categories of conduct a court would usually find to be oppressive in nature.

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Question 10

Identify the elements that the court has recommended be examined in order to determine whether the appropriation of a corporate opportunity by a director or officer is a breach of fiduciary duty.

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Question 11

Identify the source of and briefly discuss the present standard of care with respect to the duty of competence owed to a corporation.

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Question 12

The steps involved in winding up a corporation are relatively simple and straightforward,making it no more or less feasible than simply allowing a company to lapse.

Accepted Answer

Winding up a corporation involves multiple legal and financial steps, such as paying off creditors, filing dissolution documents with the government, and distributing remaining assets to shareholders. Allowing a company to lapse, on the other hand, simply means not renewing its registration with the government and ceasing operations, which is a much simpler process.

Question 13

Briefly explain how corporate directors are able to meet their statutory standard of care and identify the various methods that directors should employ to achieve this goal.

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Question 14

Discuss the amendments to Canada's Criminal Code pertaining to the type of individuals who may trigger an organization's criminal liability.Include an explanation of the law prior to the amendments and the subsequent effects of the amendments.

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Question 15

Identify and briefly describe the circumstances that would permit enforcement of a self-dealing contract under the Canada Business Corporations Act.

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Quiz 16: The Corporate Form: Operational Matters