Toronto Professional Liability Lawyers for Directors and Officers

Corporate governance refers to the way in which the business and the affairs of a corporation are carried out. Corporate governance is intended to make the division of power between corporate directors, corporate officers, and shareholders clear.

Directors of corporations are responsible for the overall strategic direction of the corporation and for making decisions accordingly. Officers are responsible for the day-to-day operations of the corporation. Both directors and officers must exercise the care, diligence, and skill that a reasonably prudent person would exercise in similar circumstances.

Where a director or an officer fails to meet these standards, he or she may be subject to a claim for oppression remedy or a derivative action. Such claims attract significant liability and have serious consequences.

Fiduciary Duties 

Directors and officers have a fiduciary duty towards the corporation and must act with good faith, honesty, and loyalty. Directors and officers must, therefore, avoid conflicts of interest at all times and must always act in the best interest of the corporation. Where conflicts do arise, the directors and officers must disclose that they exist.

Directors cannot:

• Compete with the corporation
• Disclose confidential information or
• Use confidential information for their own benefit.

Directors who breach their fiduciary duty are subject to serious consequences.

Officer and Director Liability 

In many cases, the corporation is considered a separate legal entity from its directors and officers, and the so-called “corporate veil” will protect the directors and officers from liability from actions they take in the corporation’s name.

However, there are a number of actions that directors and officers can be found personally liable for. These include:

• Fraud
• Oppression claims in small corporations where the director is the sole directing mind of the corporation and personally benefits from his or her conduct
• Claims arising from conduct that was in the director or officer’s own interest rather than the interests of the corporation
• Claims for deductions and remittances that are due under various employment and tax laws, especially where a corporation becomes insolvent.

How Can Milosevic & Associates Help? 

If you are a director or an officer and have been subject to a claim, it is important to seek the advice of a knowledgeable corporate lawyer with significant experience advising corporate actors. At Milosevic & Associates, our Toronto corporate lawyers have many years of experience acting on behalf of directors and officers in claims filed against them, including:

• Allegations of negligence
• Allegations of breach of fiduciary duty
• Claims for oppression remedies
• Derivative actions.

We have developed a reputation for professionalism and integrity that benefits our clients. We are committed to the highest standards of ethics and professional courtesy towards the courts, our clients, opposing counsel, and all other relevant parties.

For a Strong Defence against Claims of Director or Officer Negligence, contact Milosevic & Associates

If you are an officer or director of a corporation and a claim has been filed against you, contact the highly knowledgeable Toronto corporate lawyers at Milosevic & Associates as soon as possible.  Our goal is to immediately protect you, your reputation, and the health of the corporation. Call us at 416-916-1387 or contact us online.