A recent decision of the Superior Court of Justice is a helpful reminder of the personal liability a corporate director may face in relation to an oppression claim brought by a creditor of that corporation. Creditors looking to pursue claims against a debtor corporation that may have insufficient assets to satisfy the claim would be […]
Category Archives: Professional Liability
Are Volunteer Directors Personally Liable for a Non-Profit’s Actions?
Volunteer directors play a critical role in the governance and success of non-profit organizations across Ontario. From charities and community associations to professional bodies and advocacy groups, these individuals often dedicate significant time and expertise without financial compensation. While the position may be unpaid, the legal responsibilities associated with it are very real. A common […]
Auditor Negligence: Insights From the FTX and Prager Metis Case
Auditors serve as critical gatekeepers in the financial ecosystem, ensuring the accuracy and reliability of financial statements. Their role is pivotal in maintaining investor confidence and the overall integrity of financial markets. However, when auditors fail to exercise due diligence, the consequences can be catastrophic, as evidenced by the recent FTX scandal in the United […]
The Impact of ESG Obligations on Director Liability in Ontario
In recent years, Environmental, Social, and Governance (ESG) considerations have taken centre stage in the corporate world, reshaping how businesses operate and are held accountable. Investors, regulators, and consumers increasingly demand that companies prioritize sustainability, ethical practices, and robust governance frameworks. In Ontario, these growing ESG expectations have significant implications for directors, who are tasked […]
When Will Investment Advisors Owe Fiduciary Obligations To Their Clients?
In some contexts, the relationship between an investment advisor and their client may be fiduciary in nature. In that case, damage suffered by a client may lead to a claim against the advisor for breach of fiduciary duty. Where a group of clients suffers damage due to such a breach, it may give rise to […]
Breach of Contract by a Company: A Potential Path to Personal Liability for Directors
When a business enters into a contract with another company, it must carry the risk that it will not be able to recoup its losses from the company in the event of its breach. This risk may be magnified when the company is small and closely held. Much of this risk originates in a legal […]
Incoming Corporate Disclosure Requirements for Those in “Significant Control”
Corporate transparency has become more of a focus for the Ontario legislature, as a means of imposing greater accountability among companies and business leaders. While anonymous actors can hide behind a corporate name or number, the ability to identify those in charge can reduce the incidence of fraud, or other financial misdeeds. To aid in […]
Financial Advisors: New Guidelines Coming to Protect Senior Clients
Seniors, those over age 65, are disproportionately the victims of fraud and financial abuse due to social isolation, potential capacity issues, and more. Particularly since the start of the pandemic, older Canadians may be spending more time alone and online, which has increased their vulnerability to financial and investment fraud, according to the North American […]
Court Finds Director of Corporation Liable for Litigation Abuses
When a corporation is a party to litigation, the risk of a finding of liability or an award of costs generally does not follow the directors or corporate principals in their personal capacity. Corporate officers are commonly shielded from personal liability in corporate actions. However, this protection is not absolute, and courts have jurisdiction to […]
Corporate Directors & Personal Liability for Unpaid Wages
A recent decision of the Ontario Court of Appeal in Abbasbayli v. Fiera Foods Company provides insight into the statutory claims that may be brought against corporate directors for unpaid wages and vacation pay in the context of wrongful dismissal. Terminated Employee Makes Claim for Unpaid Wages Against Corporation and Directors Personally The Plaintiff, Mr. […]