Chapter 10 - Members' Remedies

Question 1

What re the main types of actions members can take against a company?

Answer 1

1. Personal actions
2. Representative actions
3. Derivative claims

Question 2

What is a derivative claim?

Answer 2

A claim brought by a member on behalf of the company for a wrong done to the company, typically against directors for breach of duty (CA 2006, ss 260 - 264)

Question 3

What is the unfair prejudice remedy?

Answer 3

A remedy under s. 994 CA 2006 where a member can petition the court if the company’s affairs are being conducted in a manner unfairly prejudicial to their interests.

Question 4

What is the remedy for unfair prejudice?

Answer 4

The court may order any remedy it sees fit, including requiring the purchase of the petitioner’s shares.

Question 5

What is a petition for winding up on just and equitable grounds?

Answer 5

A member may petition the court to wind up the company if it is just and equitable to do so (IA 1986, s 122(1)(g)).

Question 6

Quick hit
Derivative Claim

Answer 6

A claim brought by a member on behalf of the company.

Question 7

Quick hit
s. 994 CA 2006

Answer 7

Unfair prejudice remedy

Question 8

Quick hit
Just and Equitable Winding Up

Answer 8

A court-ordered dissolution of the company under IA 1986

Question 9

Quick hit
Personal Action

Answer 9

A claim by a member for personal right (e.g. voting rights)

Question 10

Quick hit
Representative Action

Answer 10

A claim brought by one member on behalf of others with the same interest.