Canada Not-for-profit Corporations Act (S.C. 2009, c. 23)

Act current to 2017-11-06 and last amended on 2015-02-26. Previous Versions

Marginal note:Absolute privilege — defamation
  •  (1) Any oral or written statement or report made by an inspector or any other person in an investigation under this Part has absolute privilege.

  • Marginal note:Copy of report

    (2) An inspector shall send to the Director a copy of every report made by the inspector under this Part.

Marginal note:Solicitor-client privilege or professional secrecy

 Nothing in this Part shall be construed as affecting solicitor-client privilege or, in Quebec, the professional secrecy of advocates and notaries.

PART 16Remedies, Offences and Punishment

Marginal note:Definitions

 The following definitions apply in this Part.

action

poursuite

action means an action under this Act. (poursuite)

complainant

plaignant

complainant means

  • (a) a former or present member or debt obligation holder of a corporation or any of its affiliates;

  • (b) a present or former registered holder or beneficial owner of a share of an affiliate of a corporation;

  • (c) a former or present director or officer of a corporation or any of its affiliates;

  • (d) the Director; or

  • (e) any other person who, in the discretion of a court, is a proper person to make an application under this Part. (plaignant)

Marginal note:Derivative action
  •  (1) On the application of a complainant, a court may make an order granting the complainant leave to bring an action in the name of and on behalf of a corporation or any of its subsidiaries, or intervene in an action to which such a body corporate is a party, for the purpose of prosecuting, defending or discontinuing the action on its behalf.

  • Marginal note:Conditions precedent

    (2) The court may not make an order under subsection (1) unless the court is satisfied that

    • (a) the complainant has given notice to the directors of the corporation or its subsidiary of the complainant’s intention to apply to the court under subsection (1) within the prescribed period before bringing the application, or as otherwise ordered by the court, if the directors of the corporation or its subsidiary do not bring the action, prosecute or defend it diligently or discontinue it;

    • (b) the complainant is acting in good faith; and

    • (c) it appears to be in the interests of the corporation or its subsidiary that the action be brought, prosecuted, defended or discontinued.

  • Marginal note:Faith-based defence

    (3) The court may not make an order under subsection (1) if the court is satisfied that

    • (a) the corporation is a religious corporation;

    • (b) the decision of the directors referred to in paragraph (2)(a) is based on a tenet of faith held by the members of the corporation; and

    • (c) it was reasonable to base the decision on a tenet of faith, having regard to the activities of the corporation.

Marginal note:Powers of court

 In connection with an action brought or intervened in as a result of an application under subsection 251(1), the court may at any time make

  • (a) an order authorizing the complainant or any other person to control the conduct of the action;

  • (b) an order giving directions for the conduct of the action;

  • (c) an order directing that any amount adjudged payable by a defendant in the action shall be paid, in whole or in part, directly to former or present shareholders, members and debt obligation holders of the corporation or its subsidiary instead of to the corporation or its subsidiary;

  • (d) an order requiring the corporation or its subsidiary to pay reasonable legal costs incurred by the complainant in connection with the action; and

  • (e) any other order that it thinks fit.

Marginal note:Application to court re oppression
  •  (1) On the application of a complainant, a court may make an order if it is satisfied that, in respect of a corporation or any of its affiliates, any of the following is oppressive or unfairly prejudicial to or unfairly disregards the interests of any shareholder, creditor, director, officer or member, or causes such a result:

    • (a) any act or omission of the corporation or any of its affiliates;

    • (b) the conduct of the activities or affairs of the corporation or any of its affiliates; or

    • (c) the exercise of the powers of the directors or officers of the corporation or any of its affiliates.

  • Marginal note:Faith-based defence

    (2) The court may not make an order if the court is satisfied that

    • (a) the corporation is a religious corporation;

    • (b) the act or omission, the conduct or the exercise of powers is based on a tenet of faith held by the members of the corporation; and

    • (c) it was reasonable to base the act or omission, the conduct or the exercise of powers on the tenet of faith, having regard to the activities of the corporation.

  • Marginal note:Powers of court

    (3) The court may make any interim or final order that it thinks fit, including an order

    • (a) restraining the conduct complained of;

    • (b) appointing a receiver or receiver-manager;

    • (c) with respect to a corporation’s affairs, requiring the amendment of the articles or by-laws or the creation or amendment of a unanimous member agreement;

    • (d) directing an issue or exchange of memberships, debt obligations or securities;

    • (e) appointing directors in place of or in addition to all or any of the directors then in office;

    • (f) directing a corporation, subject to subsection (5), or any other person, to purchase the debt obligation of a debt obligation holder;

    • (g) directing a corporation, subject to subsection (5), or any other person, to pay a member all or part of the amount that the member paid for their membership;

    • (h) varying, setting aside or annulling a transaction or contract to which a corporation is a party and compensating the corporation or any other party to the transaction or contract;

    • (i) requiring a corporation, within a time specified by the court, to produce to the court or an interested person financial statements in the form required by section 172 or an accounting in any other form that the court may determine;

    • (j) compensating an aggrieved person;

    • (k) directing rectification of the registers or other records of a corporation under section 255;

    • (l) liquidating and dissolving a corporation;

    • (m) directing an investigation under Part 15 to be made; and

    • (n) requiring the trial of any issue.

  • Marginal note:Duty of directors

    (4) If an order directs amendment of the articles or by-laws of a corporation,

    • (a) the directors shall immediately comply with subsection 215(4); and

    • (b) no other amendment to the articles or by-laws shall be made without the consent of the court, until a court otherwise orders.

  • Marginal note:Limitation

    (5) A corporation shall not make a payment to a member under paragraph (3)(f) or (g) if there are reasonable grounds for believing that, after that payment,

    • (a) the corporation is or would be unable to pay its liabilities as they become due; or

    • (b) the realizable value of the corporation’s assets would be less than the aggregate of its liabilities.

  • Marginal note:Alternative order

    (6) An applicant under this section may apply in the alternative for an order under section 224.

 
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