Unit 2 - Chapter 16

Question 1

A ____ is a legal person in the eyes of the law

Answer 1

corporation

Question 2

A corporation can be liable under primary and vicarious liability in tort law. It is _____ liable when it is the entity that directly committed the tort. It is ____ liable when an agent or employee who is not a directing mind of the corporation commits the tort

Answer 2

primarily….. vicariously

Question 3

____ law generally determines when a corporation is liable on a contract

Answer 3

Agency

Question 4

To avoid ____ liability, contracts signed should clearly indicate that the person is signing on behalf of the corporation and is not signing in a personal capacity

Answer 4

personal

Question 5

A corporation has committed a crime if the person who committed the crime was a ____ ___ or a senior officer of the corporation and if the crime was committed in the course of the duties and the actions were done for the benefit of the corporation

Answer 5

directing mind

Question 6

An offence contrary to the public interest is known as a ____ offence

Answer 6

regulatory

Question 7

Directors and Officers are _____ to the corporation

Answer 7

fiduciaries

Question 8

Making all decisions informed decisions, doing what is necessary to learn about matters affecting the company, identifying problems within the company are all ways to avoid risk of ____ liability

Answer 8

personal

Question 9

What are the three broad categories of shareholder rights?

Answer 9

1. right to vote
2. right to information
3. financial rights

Question 10

___ share is a share that generally has a right to vote, to share in dividends and to share in proceeds on dissolution

Answer 10

common

Question 11

_____ share is a share or stock that has a preference in the distribution of dividends and the proceeds on dissolution

Answer 11

preferred

Question 12

_____ shareholder may sell shares or exercise dissent and appraisal rights

Answer 12

dissatisfied

Question 13

____ action is a suit by a shareholder on behalf of a corporation to enforce a corporate cause of action

Answer 13

derivative

Question 14

_____ remedy/action is a statutory remedy available to shareholders and other stakeholders to protect their corporate interests

Answer 14

oppression

Question 15

______ agreement defines the relationship among people who have an ownership interest in a corporation

Answer 15

shareholders’

Question 16

____ ____ agreement is an agreement among all shareholders that restricts the powers of the directors to manage the corporation

Answer 16

unanimous shareholders’

• -> management of the corporation
• -> protection for the minority shareholders

Question 17

Canada Business Corporations Act forbids any corporation from paying ___ to shareholders if doing so would jeopardize its ability to pay own debts as they fall due.

Answer 17

dividends

Question 18

Corporation may be terminated by ____ __ - process of dissolving a corporation

Answer 18

winding up

Question 19

_____ is neglect to file annual report or to follow other reporting requirements
(termination of a corp.)

Answer 19

lapse

Question 20

Corporation can be terminated by ___ ___ - shareholder wrongfully treated and this is the only way to justice

Answer 20

court order

Question 21

______, another way of terminating a corporation (run out of money leading to dissolution)

Answer 21

bankruptcy

Question 22

Directors and officers also may be liable both in ____ and ___ law for actions relating to the business of the corporation

Answer 22

criminal and civil