Canada Business Corporations Act (R.S.C., 1985, c. C-44)

Act current to 2017-09-14 and last amended on 2015-02-26. Previous Versions

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.

  • R.S., 1985, c. C-44, s. 236;
  • 2001, c. 14, s. 135(E);
  • 2011, c. 21, s. 67.
Marginal note:Inquiries

 The Director may make inquiries of any person relating to compliance with this Act.

  • 1974-75-76, c. 33, s. 230;
  • 1978-79, c. 9, s. 1(F).

PART XIX.1Apportioning Award of Damages

Interpretation and Application

Marginal note:Definitions

 The definitions in this section apply in this Part.

financial interest

intérêt financier

financial interest, with respect to a corporation, includes

  • (a) a security;

  • (b) a title to or an interest in capital, assets, property, profits, earnings or royalties;

  • (c) an option or other interest in, or a subscription to, a security;

  • (d) an agreement under which the interest of the purchaser is valued for purposes of conversion or surrender by reference to the value of a proportionate interest in a specified portfolio of assets;

  • (e) an agreement providing that money received will be repaid or treated as a subscription for shares, units or interests at the option of any person or the corporation;

  • (f) a profit-sharing agreement or certificate;

  • (g) a lease, claim or royalty in oil, natural gas or mining, or an interest in the lease, claim or royalty;

  • (h) an income or annuity contract that is not issued by an insurance company governed by an Act of Parliament or a law of a province;

  • (i) an investment contract; and

  • (j) anything that is prescribed to be a financial interest. (intérêt financier)

financial loss

perte financière

financial loss means a financial loss arising out of an error, omission or misstatement in financial information concerning a corporation that is required under this Act or the regulations. (perte financière)

third party

Version anglaise seulement

third party includes any subsequent party that is joined in proceedings before a court. (Version anglaise seulement)

  • 2001, c. 14, s. 115.
Marginal note:Application of Part
  •  (1) This Part applies to the apportionment of damages awarded to a plaintiff for financial loss after a court has found more than one defendant or third party responsible for the financial loss.

  • Marginal note:Non-application of Part

    (2) This Part does not apply to an award of damages to any of the following plaintiffs:

    • (a) Her Majesty in right of Canada or of a province;

    • (b) an agent of Her Majesty in right of Canada or of a province or a federal or provincial Crown corporation or government agency, unless a substantial part of its activities involves trading, including making investments in, securities or other financial instruments;

    • (c) a charitable organization, private foundation or public foundation within the meaning of subsection 149.1(1) of the Income Tax Act; or

    • (d) an unsecured creditor in respect of goods or services that the creditor provided to a corporation.

  • 2001, c. 14, s. 115.

Apportionment of Damages

Marginal note:Degree of responsibility
  •  (1) Subject to this section and sections 237.4 to 237.6, every defendant or third party who has been found responsible for a financial loss is liable to the plaintiff only for the portion of the damages that corresponds to their degree of responsibility for the loss.

  • Marginal note:Uncollectable amounts

    (2) If any part of the damages awarded against a responsible defendant or third party is uncollectable, the court may, on the application of the plaintiff, reallocate that amount to the other responsible defendants or third parties, if the application is made within one year after the date that the judgment was made enforceable.

  • Marginal note:Reallocation

    (3) The amount that may be reallocated to each of the other responsible defendants or third parties under subsection (2) is calculated by multiplying the uncollectable amount by the percentage that corresponds to the degree of responsibility of that defendant or third party for the total financial loss.

  • Marginal note:Maximum amount

    (4) The maximum amount determined under subsection (3), in respect of any responsible defendant or third party, may not be more than fifty per cent of the amount originally awarded against that responsible defendant or third party.

  • 2001, c. 14, s. 115.
Marginal note:Exception — fraud
  •  (1) The plaintiff may recover the whole amount of the damages awarded by the court from any defendant or third party who has been held responsible for a financial loss if it was established that the defendant or third party acted fraudulently or dishonestly.

  • Marginal note:Contribution

    (2) The defendant or third party referred to in subsection (1) is entitled to claim contribution from any other defendant or third party who is held responsible for the loss.

  • 2001, c. 14, s. 115.

Joint and Several, or Solidary, Liability

Marginal note:Individual or personal body corporate
  •  (1) Defendants and third parties referred to in subsection 237.2(1) are jointly and severally, or solidarily, liable for the damages awarded to a plaintiff who is an individual or a personal body corporate and who

    • (a) had a financial interest in a corporation on the day that an error, omission or misstatement in financial information concerning the corporation occurred, or acquired a financial interest in the period between the day that the error, omission or misstatement occurred and the day, as determined by the court, that it was generally disclosed; and

    • (b) has established that the value of the plaintiff’s total financial interest in the corporation was not more than the prescribed amount at the close of business on the day that the error, omission or misstatement occurred or at the close of business on any day that the plaintiff acquired a financial interest in the period referred to in paragraph (a).

  • Marginal note:Exception

    (1.1) Subsection (1) does not apply when the plaintiff brings the action as a member of a partnership or other association or as a trustee in bankruptcy, liquidator, receiver or sequestrator of a body corporate.

  • Marginal note:Interpretation

    (2) For the purposes of this section,

    • (a) a personal body corporate is a body corporate that is not actively engaged in any financial, commercial or industrial business and that is controlled by an individual, or by a group of individuals who are connected by marriage, common-law partnership or any legal parent-child relationship or are connected indirectly by a combination of those relationships, whether or not the individuals through whom they are connected are members of the group; and

    • (b) a common-law partnership is a relationship between two persons who are cohabiting with each other in a conjugal relationship and have done so for a period of at least one year.

  • 2001, c. 14, s. 115;
  • 2005, c. 33, s. 5;
  • 2011, c. 21, s. 68(E).
Marginal note:Equitable grounds
  •  (1) If the value of the plaintiff’s total financial interest referred to in subsection 237.5(1) is greater than the prescribed amount, a court may nevertheless determine that the defendants and third parties are jointly and severally, or solidarily, liable if the court considers that it is just and reasonable to do so.

  • Marginal note:Factors

    (2) The Governor in Council may establish factors that the court shall take into account in deciding whether to hold the defendants and third parties jointly and severally, or solidarily, liable.

  • Marginal note:Statutory Instruments Act

    (3) The Statutory Instruments Act does not apply to the factors referred to in subsection (2), but the factors shall be published in Part I of the Canada Gazette.

  • 2001, c. 14, s. 115.
 
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