Canada Cooperatives Act (S.C. 1998, c. 1)

Marginal note:Liability for wages

• 102. (1) Subject to this section and any other applicable law, each director is jointly and severally, or solidarily, liable to the employees of the cooperative for all debts payable to them for services performed while the director held office.

• (2) [Repealed, 2001, c. 14, s. 167]

• Marginal note:Amount of liability

  (3) The amount of the liability under this section may not exceed six months wages in the case of each employee.

• Marginal note:Conditions precedent

  (4) A director is not liable under this section unless

  • (a) the cooperative was sued for the debt within six months after it became due and execution was returned unsatisfied in whole or in part;

  • (b) the cooperative has commenced liquidation or dissolution proceedings or was dissolved and a claim for the debt was proved no later than six months after the earlier of the date of commencement of the proceedings and the date of the dissolution; or

  • (c) the cooperative made an assignment or was made subject to a bankruptcy order under the Bankruptcy and Insolvency Act and a claim for the debt was proved no later than six months after the date of the assignment or bankruptcy order.

• Marginal note:Limitation period

  (5) A director is not liable under this section unless he or she is sued while holding office or no later than two years after ceasing to be a director.

• Marginal note:Amount due after execution

  (6) If execution referred to in paragraph (4)(a) has issued, the amount recoverable from the director is the amount remaining unsatisfied after execution.

• Marginal note:Subrogation of director

  (7) A director who pays a debt owed under this section that is proven in liquidation and dissolution or bankruptcy proceedings is subrogated to any priority that the employee would have been entitled to and, if a judgment has been obtained, the director is

  • (a) in Quebec, subrogated to the employee’s rights as declared in the judgment; and

  • (b) elsewhere in Canada, entitled to an assignment of the judgment.

• Marginal note:Contribution

  (8) A director who pays a debt owed under this section is entitled to contribution from the other directors who were liable for the debt.

Marginal note:Disclosure of interest

• 103. (1) A director or officer must, in accordance with this section, disclose to the cooperative the nature and extent of any interest that the director or officer has in a material contract or transaction, or a proposed material contract or transaction, with the cooperative, and any material change to any such interest, if the director or officer

  • (a) is a party to the contract or transaction;

  • (b) is a director or officer — or an individual acting in a similar capacity — of a party to the contract or transaction; or

  • (c) has a material interest in a party to the contract or transaction.

• Marginal note:Exemption

  (2) This section does not require the disclosure of an interest in a contract or transaction that is available to and customarily entered into between the cooperative and its members, if the contract or transaction is on the same terms as are generally available to members.

• Marginal note:Manner of disclosure

  (3) The director or officer must make the disclosure in writing to the cooperative or request to have it entered in the minutes of the meetings of directors.

• Marginal note:Time of disclosure for a director

  (4) A director must make the disclosure

  • (a) at the meeting of directors at which the proposed contract or transaction is first considered;

  • (b) if the director was not interested in the proposed contract or transaction at the time of the meeting referred to in paragraph (a), at the first meeting after the director acquires an interest in it;

  • (c) if there is a material change in the director’s interest in the contract, transaction, proposed contract or proposed transaction, at the first meeting after the change;

  • (d) if the director becomes interested in a contract or transaction after it is made, at the first meeting after the director acquires an interest in it;

  • (e) if the director had an interest in the contract or transaction before becoming a director, at the first meeting after becoming a director; or

  • (f) if the contract or transaction is one that would, in the ordinary course of business, not require the approval of the directors, as soon as the director becomes aware of the contract or transaction.

• Marginal note:Time of disclosure for an officer

  (5) An officer who is not a director must make the disclosure

  • (a) immediately after becoming aware that the contract, transaction, proposed contract or proposed transaction is to be considered or has been considered at a meeting of directors;

  • (b) if the officer acquires an interest in a contract or transaction after it is made, immediately after the officer acquires an interest in it;

  • (c) if there is a material change in the officer’s interest in the contract, transaction, proposed contract or proposed transaction, immediately after the change;

  • (d) if the officer had an interest in the contract or transaction before becoming an officer, immediately after becoming an officer; or

  • (e) if the contract or transaction is one that would, in the ordinary course of business, not require the approval of the directors, as soon as the officer becomes aware of the contract or transaction.

• Marginal note:Access

  (6) The members and shareholders may examine the portions of minutes of meetings of directors, of other documents that contain disclosures under this section and of the general notice referred to in section 105 during the usual business hours of the cooperative.

• (7) [Repealed, 2001, c. 14, s. 168]