Insurance Companies Act (S.C. 1991, c. 47)

Marginal note:Limitation

843. An action to enforce a liability imposed by section 841 may not be commenced after two years from the date of the resolution authorizing the action complained of.

Marginal note:Directors liable for wages

• 844. (1) Subject to subsections (2) and (3), the directors of an insurance holding company are jointly and severally, or solidarily, liable to each employee of the insurance holding company for all debts not exceeding six months wages payable to the employee for services performed for the insurance holding company while they are directors.

• Marginal note:Conditions precedent

  (2) A director is not liable under subsection (1) unless

  • (a) the insurance holding company has been sued for the debt within six months after it has become due and execution has been returned unsatisfied in whole or in part;

  • (b) the insurance holding company has commenced liquidation and dissolution proceedings or has been dissolved and a claim for the debt has been proven within six months after the earlier of the date of commencement of the liquidation and dissolution proceedings and the date of dissolution; or

  • (c) the insurance holding company has made an assignment or a bankruptcy order has been made against it under the Bankruptcy and Insolvency Act and a claim for the debt has been proven within six months after the date of the assignment or bankruptcy order.

• Marginal note:Limitations

  (3) A director is not liable under subsection (1) unless the director is sued for a debt referred to in that subsection while a director or within two years after the director has ceased to be a director.

• Marginal note:Amount due after execution

  (4) Where execution referred to in paragraph (2)(a) has issued, the amount recoverable from a director is the amount remaining unsatisfied after execution.

• Marginal note:Subrogation of director

  (5) Where a director of an insurance holding company pays a debt referred to in subsection (1) that is proven in liquidation and dissolution or bankruptcy proceedings, the director is entitled to any preference that the employee would have been entitled to and, where a judgment has been obtained, the director is entitled to an assignment of the judgment.

• Marginal note:Contribution entitlement

  (6) A director of an insurance holding company who has satisfied a claim under this section is entitled to a contribution from the other directors of the insurance holding company who are liable for the claim.

Marginal note:Defence — due diligence

• 845. (1) A director, officer or employee of an insurance holding company is not liable under section 841 or 844 and has fulfilled their duty under subsection 795(2) if they exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances, including reliance in good faith on

  • (a) financial statements of the insurance holding company that were represented to them by an officer of the insurance holding company or in a written report of the auditor of the insurance holding company fairly to reflect the financial condition of the insurance holding company; or

  • (b) a report of a person whose profession lends credibility to a statement made by them.

• Marginal note:Defence — good faith

  (2) A director or officer of an insurance holding company has fulfilled their duty under subsection 795(1) if they relied in good faith on

  • (a) financial statements of the insurance holding company that were represented to them by an officer of the insurance holding company or in a written report of the auditor of the insurance holding company fairly to reflect the financial condition of the insurance holding company; or

  • (b) a report of a person whose profession lends credibility to a statement made by them.