2 History & Constitutional Power

Question 1

What is a corporate constitution?

Answer 1

A document that sets out the interaction between the three “centres of power” and the rights, powers, and obligations of each participant.

Question 2

Three types of corporate constitutions in common-law Canada:

Answer 2

1. Letters Patent (PEI)
2. Registration (NS; to a certain extent BC; UK)
3. Statutory Division of Powers (pretty much everywhere else in common-law Canada)

Question 3

Where is the provincial jurisdiction to incorporate found?

Answer 3

S. 92(11) of the Constitution Act, 1867: jurisdiction over the “incorporation of companies with provincial objects”.

Question 4

Where is the federal jurisdiction to incorporate found?

Answer 4

The Constitution Act, 1867: limited powers to incorporate corporations operating in specific fields, such as banks, but contains no express general power of incorporation. Federal corporations have a right to carry on business in each and cannot be barred from carrying on business in a province as a result of its name being confused with one already in use in the province or for any other reason

Case law also says that the peace, order, and good governance clause gives the federal government the right to have an incorporating of its own (the CBCA).

Question 5

What are the four major principles that govern/define corporations?

Answer 5

• Corporate personality
• Managerial power
• Majority rule
• Minority protection

Question 6

Where can conflict arise within a corporation?

Answer 6

Conflict is possible where management tries to run over the corporate personality, or as minority protection causes tension with the majority rule.

These principles don’t row in the same direction.