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Business Associations > Bus Ass Cases > Flashcards

Bus Ass Cases Flashcards

Case ratios

1
Q

ratio

Backman v Canada [2002] SCC (property flip)

A

3 elements: 1) carrying on a business 2) in common 3) with a view to profit (which may be ancillary).

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2
Q

ratio

Spire Freezers Ltd v Canada [2001] SCC (property flip)

A

the intention to profit cannot only be judged subjectiely. It must also be based on the objective evidence

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3
Q

ratio

Haughton Graphics Ltd v Zivot (1986) Ont HC

A

individuals may form a limited partnership as limited partners within a corporation as the general partner even though they are directors of it, so long as the actions carried out by the individuals in the name of the limited partnership do not assume such control that they fall under the exception in section 17

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4
Q

ratio

Nordile Holdings Ltd v Breckenridge (1992) BCCA

A

express specification of the capacity of the limited partners can override the statute

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5
Q

ratio

Central Mortgage & Housing Corp v Graham (1973)

A

There must be: a contribution by the parties of money, property, effort, knowledge, skill or other asset to a common undertaking; a joint propoerty interest in the subject matter of the venture, a right of mutual control or management of the enterprise, expectation of profit, or the presence of adventure, a right to participate in the profits, and usually a limitation of the objective to a single undertaking (CIMPL)

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6
Q

ratio

Bramalea Ltd v 620923 Ontario Inc (1992) OR

A

each case must be determined on its facts; where there is no intention to unite resources, and no shared control, there is no joint venture

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7
Q

ratio

Blue Line Hockey Acquisition Co Inc. v Orca Bay Hockey Ltd. Partnership (2008) BCSC

A

a fiduciary duty between joint venturers is not presumptive, the elements of a fiduciary relationship are: 1) the fiduciary has scope for the exercise of some discretion or power, 2) the fiduciary can unilaterally exercise that poer or discretion so as to affect the beneficiary’s legal or practical interests 3) the beneficiary is peculiarly vulnerable or at the mercy of the fiduciary holding the discretion or power

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8
Q

ratio

Saloman v Saloman & Co (1896) HL

A

where one person incorporates and is the sole shareholder, there is still a corporation and that person still enjoys limited liability. The corporation is a separate legal entity.

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9
Q

ratio

Lee v Lee’s Air Farming Ltd (1960) New Zealand

A

a person can act in dual roles in a company, as a sole governing director and an ameployee. Look for a contract of service vs a contract for services

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10
Q

ratio

R v Marquand (1972) BCCA

A

the distinction between a sole governing director and a company as a separate legal entity means that a sole governing director can still be guilty of theft from his own company

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11
Q

ratio

R v CIP Inc (1992) SCC

A

whether or not a corporate entity can invoke a Charter right will dpend on whether it can establish that it has an interest falling within the scope of the gurantee and one which accords with the purpose of that provision. A corporation as a legit interest in being tried within a reasonable time.

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12
Q

ratio

De Salaberry Realties v MNR (1974) Fed CA

A

it may be appropriate for a court to pierce the corporate veil in certain cases of fraud, contravention of law or public wrong, if it is found that the company is indistinguishable from its affiliates. For evidentiary purposes

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13
Q

ratio

Covert v Minister of Finance NS (1980) SCC

A

where the parent and subsidiary companies are in such a relationship that they are indistinguishable and one is a ere conduit, the corporate veil may be lifted to rectify tax evasion

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14
Q

ratio

DHN Food Distributors Ltd v Tower Hamlets London Borough Council (1976) CA

A

the treatment of companies as a group can also be beneficial when it comes to compensation for loss of land owned by the subsidiary but used by the parent

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15
Q

ratio

Adams v Cape Industries (1991) CA

A

a group of incorporated companies is allowed to so structure itself so that the liability for certain acitvities falls upon a subsidiary

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16
Q

ratio

Kosmopolous v Constitution Insurance Co (1987) SCC

A

the corporate veil will not be lifted simply in the name of equity for a sole shareholder who will otherwise not be deemed to have insurable interest in the assets of the company

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17
Q

ratio

Transamerica Life Insurance v Canadian Life Assurance (1996) Ont

A

just and equitable is not a test for lifting the corporate veil

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18
Q

ratio

Walkovsky v Carlton (1996) NYCA

A

the corporate veil may not be lifted if the action, had it been carried out by a sole proprieter would not have been fraudulent, because it should not become fraudulent because it is done through several small companies

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19
Q

ratio

Lynch v Segal (2006) ONCA

A

the test for lifting the corporate veil in the family law context is that the corporations in question are completely controlled by one spouse, for that spouse’s benefit and there are no third parties involved

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20
Q

ratio

R v Bata Induestries (1992) Ont

A

when determining statutory liability of directors for a company’s actions contrary to environmental law, look to the indvidual degree of authority and responsibility for health and safety issues, and evidence of their due dilligence

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21
Q

ratio

Bazley v Curry (1998) SCC

A

the fundamental qestion is whether the wrongful act is sufficiently related to the conduct authorized by the employer, and subsidiary factors may be considered

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22
Q

ratio

Sullivan v Desrosiers (1986) NBCA

A

principal shareholders can be liable for tortious actions even though it is their company committeing them, when it is clear that the individual’s actions caused the tort. May only be applicable for intentional torts.

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23
Q

ratio

Canadian Dredge & Dock Company v R (1985 SCC

A

the identification doctrine only operates where the crown demonstrates that the action taken by the directing mind was within the field of operation assigned to him, was not totally in fraud of the corporation, and was by design or result partly for the benefit of the company

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24
Q

ratio

The Rhone v The Widener (1993)

A

for identification theory, the court must identify the actions which substantiate a labeling of the directing mind, and determine whether that individual had those actions within the scope of his assigned employment

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25
Q

ratio

Muljo v Sunwest Projects Ltd (1991) BCCA

A

common shareholders receive rateable distribution upon winding up, regardless of their individual differences in paid up capital

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26
Q

ratio

McClurg v Canada (1990) SCC

A

a discretionary dividend clause is sufficient to rebut the repsumption of shareholder equality

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27
Q

ratio

Re Canada Tea Co (1959) Ont

A

arrear dividends on preferential shares don’t hold priority over common shareholders in winding up asset distribution

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28
Q

ratio

Trevor v Whitworth (1887)

A

companies can’t buy their own shares

29
Q

ratio

Bowater Canadian Ltd. V RL Crain Inc (1987)

A

rights attach to the share, not the shareholder

30
Q

ratio

Greenhaulgh v Arderne Cinemas Ltd

A

a class must be confined to those persons whose rights are not so dissimilar as to make it impossible for them to consult together with a view to their common interest

31
Q

ratio

Kelner v Baxter (1866) UK

A

where the wording of the contract so indicates, promoters contracting for yet unformed corporations can be held personally liable to the third party in the event that the corporation never become formed

32
Q

ratio

Newborne v Sensolid (1953) UK

A

Kelner has no applicability in the case of a contract being entered into by a director rather than an agent

33
Q

ratio

Black v Smallwood (1966) Australia

A

the fundamental question is what the parties intended or must fairly be understood to have intended

34
Q

ratio

Wickberg v Shatsky (1969) BCSC

A

in order to receive an award of damages against a defendant who enters into a pre-incorporation contract, the harm must flow from the breach of warranty

35
Q

ratio

Sherwood Design Services Ltd v 872935 Ontario Ltd (1998) Ont

A

example of the type of conduct that can be construed as ratification of a pre-incorporation contract. Valuable for the dissent which notes that only the corporation may make such an action

36
Q

ratio

Szecket v Huang (1998)

A

personal liability of the promoter is established by the legislation and prevails unless either contracted out of pursuant to the subsection, or displaced by the adoption of the contract by the company subsequent to its incorporation pursuant to the legislation

37
Q

ratio

Freeman and Lockyer v Buckhurst Park Properties Ltd (1954) UK

A

ostensible authority arises from a representation made by a principal with actual authority that the particular agent has authority

38
Q

ratio

Canadian Laboratory Supplies Ltd. V Engelhard Industries of Canada Ltd (1979) SCC

A

ostensible authority can only arise where the representation is made by someone with actual authority

39
Q

ratio

Rockland Industries Inc. v Amerada Minerals Corporation of Canada Ltd. (1980) SCC

A

a party is not estopped from claiming ostensible authority where the agent’s authority has been revoked without notice to the contracting party.

40
Q

ratio

Automatic Self-Cleansing Filter Syndicate Co v Cuninghame (1906)

A

the powers of the directors as outlined in the articles of incorporation in a memorandum jurisdiction cannot be overriden by a mere majority at a general meeting, but by an extraordinary resolution

41
Q

ratio

Scott v Scott (1942)

A

the shareholders cannot interfere with the management of the business by the directors as it was designated in the articles

42
Q

ratio

Blair v Consolidated Enflied Corp (1995)

A

the chair of a shareholders’ meeting does not have to inquire into the minds of the beneficial owners of shares, and will be presumed to have acted in good faith unless the company proves bad faith

43
Q

ratio

Brown v Duby (1980)

A

the test is whether, taking a properly realistic view, there is a substantial likelihood that the misstatement or omission may have led a stockholder to grant a proxy to the solicitor or to withold one from the other side, whereas in the absence of this he would have taken a contrary course

44
Q

ratio

Varity Corp v Jesuit Fathers of Upper Canada (1987)

A

where the primary purpose of the proposal is against the legislation, it will be rendered improper

45
Q

ratio

Verdun v Toronto Dominion Bank (1996)

A

the beneficial share owner is not the same as a registered shareholder, and where rights are attached to a registered shareholder, they don’t automatically apply to the beneficial owner

46
Q

ratio

Hercules Management Ltd v Ernst & Young (1996)

A

1) the court must determine if there was proximity between the auditors and the complainants, the complainants must establish that the auditor ought to have foreseen the complainant would rely on the report and that such reliance was reasonable. 2) policy curtailment a) the auditor knew the identity of the plaintiff or class of plaintiff and b) the reliance losses stem from the particular transaction

47
Q

ratio

Re City Equitable Fire Insurance Company Limited (1924)

A

the common law duty of care owed by a director is the skill and diligence reasonably expected from a person of his knowledge and experience, an ordinary man in comparable circumstances

48
Q

ratio

The Equitable Life Assurance Society v Bowley et al (2003)

A

a company must reasonably look to non-executive directors for independence of judgment and supervision of executive management

49
Q

ratio

Smith v Van Gorkum (1985) Delaware

A

the directors breached the fiduciary duty to the stockholders by their failure to inform themselves of all information reasonably avaliable to them and by their failure to disclose all material information such as a reasonable stockholder would consider important in deciding whether to approve an offer. gross negligence is the standard for whether the preusmption of the business judgment rule as been rebutted.

50
Q

ratio

Peoples Diamond Stores Inc. v Wise (2004) SCC

A

Canadian adoption of the business judgment rule that the decision doesn’t need to be perfect, but one of the reaosnable alternatives. The plaintiff must prove a breach of duty of case and that the injury stemmed from the breach. Creditors are not included in section 122(1)(a) of the CBCA

51
Q

ratio

Teck Corporation Ltd et al v Millar, Price, Haramboure, Gibbeson, Canadian Exploration Ltd and Afton Mines Ltd (1973) BCSC

A

directors are allowed to consider the possibility of a takeover and act against it is they bona fide believe that it is in the best interests of the company and there are grounds for that belief

52
Q

ratio

Exco Corporation et al v Nova Scotia Savings and Loan Company et al NSSCTD

A

the directors have the onus to show that the considerations upon which the decision was based are consistent only with the best interests of the company and inconsistent with any other interests

53
Q

ratio

Maple Leaf Foods Inc. v Schneider Corp (1998) OCA

A

acting in the best interests of the company does not necessarily mean acting in the best interest of the groups protected. As long as steps were taken to avoid a conflict of interest and the decision was one of reasonable alternatives, the decision will not be improper

54
Q

ratio

BCE Inc. v 1979 Debentureholders (2008) SCC

A

whether the directors acted in the best interests of the corporation having regard to al relevant considerations, including, but not confined to, the need to treat affected stakeholders in a fair manner, commensurate with the corporation’s duties as a responsible citizen

55
Q

ratio

Transvaal Lands Company v New Belgium (1914)

A

a director of a company is precluded from dealing, on behalf of the company, with himself and from entering into engagements in which he has a personal interest conflicting, or which may possibly conflict with the interest of those whom he is bound by a fiduciary duty to protect

56
Q

ratio

Hely-Hutchinson v Brayhead Ltd (19868) QB

A

the loss of the right to avoid or seek recission rendered to contract enforceable against the company

57
Q

ratio

Guiness PLC v Ward (1990)

A

the rules of equity prohibit a trustee from putting himself in a position in which his interests and duty conflict and insist that a trustee or any other fiduciary shall not make a profit out of trust

58
Q

ratio

Cook v Deeks (1916)

A

a director may not use his position to gain benefit for himself contrary to the interests of the company

59
Q

ratio

Regal (Hastings) Ltd v Gulliver (1942) HL

A

it doesn’t matter whether there is bad faith, director are liable for profits by the mere fact of a profit being made by use of a fiduciary position

60
Q

ratio

Peso Silver Mines Ltd v Cropper (1996) BCCA

A

the director will have to account for profits if gained by reason of the fact and only by reason of the fact that they were director and in the course of execution of that office

61
Q

ratio

Peso Silver Mines Ltd v Cropper

A

when the appellant was approached, it was not in his capacity as a director

62
Q

ratio

Canadian Aero Services Ltd v O’Malley et al (1974) SCC

A

breach of fiduciary duty can occur after termination of directorshop and its not dependent upon proof that the company would have received the benefit if the director had not

63
Q

ratio

Slate Ventures Inc. v Hurley (1996)

A

where there is actual conflict and the info is aquired by the position - liable. Where there is potential conflict and the info is acquired by the position - liable. Where there is no conflict and the info is independent - not liable. Where there is potential conflict and the info is independent - not liable. where there is actual conflict and the info is independent - liable. where there is no conlifct and the info is acquired by position - liable.

64
Q

ratio

First Edmonton Place Ltd v 315888 Alberta Ltd (1989)

A

the criterion to be applied for proper peron is whether, even if the applicant did not come within the provisions, he would nevertheless be a person who could reasonably be entrusted with the responsibility of advancing the interests of the corporation by seeking a remedy to right the wrong allegedly done to the corporation

65
Q

ratio

Turner et al v Mailhot et al (1985)

A

having leave to the court is a prima facie case for indemnification, then you look at who the primary beneficiary of the action is

66
Q

ratio

Discovery Enterprises Inc. v Ebco Industries Ltd. (1998) BCJ

A

it is the board, excluding any director who is disqualified from voting on particular issues because of his interest in the lawsuit who must instruct counsel on the many questions likely to arise in the derivative action affecting the company

67
Q

ratio

Goldex Mines Ltd v Revell (1975)

A

a derivative action is one in which the wrong done is to the company and is always a class action brought in representative form thereby binding all the shareholders

68
Q

ratio

Catalyst Fund General Partner I Inc. v Hollinger Inc (2004) OSC

A

in the case of inspective relief, there must be at the very least an index of suspicion or appearance that reasonable shareholder expectations have not been met in viewing the actions or non actions of the management and directors.

Business Associations (6 decks)

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