Acts and Regulations

B-9.1 - Business Corporations Act

Section 77
Disposition versions

Full text
Disclosure of interest of director or officer in contracts
77(1)A director or officer of a corporation shall disclose in writing to the corporation, or request to have entered in the minutes of meetings of directors the nature and extent of their interest, if the director or officer
(a) is a party to a material contract, proposed material contract, material transaction or proposed material transaction with the corporation, or
(b) is a director or an officer of or has a material interest in any person who is a party to a material contract, proposed material contract, material transaction or proposed material transaction with the corporation.
77(2)The disclosure required by subsection (1) shall be made, in the case of a director, at the meeting at which a proposed contract or transaction is first considered, or if not,
(a) if the director was not at the time of the meeting interested in a proposed contract or transaction, at the first meeting after the director becomes interested,
(b) if the director becomes interested after a contract or transaction is made, at the first meeting after the director becomes interested, or
(c) if a person who is interested in a contract or transaction later becomes a director, at the first meeting after the person becomes a director.
77(3)The disclosure required by subsection (1) shall be made, in the case of an officer who is not a director,
(a) immediately after the officer becomes aware that the contract or transaction or proposed contract or transaction is to be considered or has been considered at a meeting of directors,
(b) if the officer becomes interested after a contract or transaction is made, immediately after the officer becomes interested, or
(c) if a person who is interested in a contract or transaction later becomes an officer, immediately after the person becomes an officer.
77(4)If a material contract or material transaction or proposed material contract or proposed material transaction is one that, in the ordinary course of the corporation’s business, would not require approval by the directors or shareholders, a director or officer shall disclose in writing to the corporation, or request to have entered in the minutes of meetings of directors, the nature and extent of the director’s or officer’s interest immediately after the director or officer becomes aware of the contract or transaction or proposed contract transaction.
77(5)A director referred to in subsection (1) shall not attend any part of a meeting of directors during which the contract or transaction is discussed and shall not vote on any resolution to approve the contract or transaction unless the contract or transaction is
(a) one relating primarily to their remuneration as a director of the corporation or an affiliate,
(b) one for indemnity or insurance under section 81, or
(c) one with an affiliate.
77(6)If no quorum exists for the purpose of voting on a resolution to approve a contract or transaction only because a director is not permitted to be present at the meeting by reason of subsection (5), the remaining directors shall be deemed to constitute a quorum for the purposes of voting on the resolution.
77(7)When all the directors are required to make disclosure under subsection (1), the contract or transaction may be approved only by the shareholders.
77(8)For the purposes of this section, a general notice to the directors by a director or officer disclosing that they are a director or officer of or have a material interest in a person, or that there has been a material change in the director’s or officer’s interest in the person, and that they are to be regarded as interested in any contract made or any transaction entered into with that person, is sufficient disclosure of interest in relation to the contract or transaction.
77(9)The shareholders of the corporation may examine the portions of any minutes of meetings of directors or of committees of directors that contain disclosures under this section, and any other documents that contain those disclosures, during the usual business hours of the corporation.
77(10)A director or officer referred to in subsection (1) is liable to account to the corporation and its shareholders for any profit made on the contract or transaction, unless
(a) the director or officer disclosed their interest in accordance with subsections (2), (3) and (4),
(b) after the disclosure, the contract or transaction was approved by the directors or the shareholders, and
(c) the director or officer establishes that the contract or transaction was reasonable and fair to the corporation at the time it was approved.
77(11)When a director or officer of a corporation fails to comply with this section, the Court may, on the application of the corporation or a shareholder of the corporation, set aside the contract or transaction on any terms as it thinks fit and direct that the director or officer account to the corporation and its shareholders for any profit made on the contract or transaction.
77(12)Despite anything in this section, a director or officer is not accountable to the corporation and its shareholders for any profit made on the contract or transaction
(a) if the contract or transaction is confirmed or approved by a majority of the votes cast by disinterested shareholders at a general meeting called for that purpose,
(b) if the nature and extent of the director’s or officer’s interest are declared and disclosed in reasonable detail in the notice calling the meeting, and
(c) the contract or transaction was reasonable and fair to the corporation at the time it was approved or confirmed.
77(13)This section does not apply to a director or officer of a corporation all of whose shares are owned by one person.
1983, c.15, s.13; 2000, c.9, s.7; 2023, c.2, s.56
Disclosure of interest of director or officer in contracts
77(1)A director or officer of a corporation who
(a) is a party to a material contract or proposed material contract with the corporation, or
(b) is a director or an officer of or has a material interest in any person who is a party to a material contract or proposed material contract with the corporation,
shall disclose in writing to the corporation or request to have entered in the minutes of meetings of directors the nature and extent of his interest.
77(2)The disclosure required by subsection (1) shall be made, in the case of a director,
(a) at the meeting at which a proposed contract is first considered;
(b) if the director was not then interested in a proposed contract, at the first meeting after he becomes so interested;
(c) if the director becomes interested after a contract is made, at the first meeting after he becomes so interested; or
(d) if a person who is interested in a contract later becomes a director, at the first meeting after he becomes a director.
77(3)The disclosure required by subsection (1) shall be made, in the case of an officer who is not a director,
(a) forthwith after he becomes aware that the contract or proposed contract is to be considered or has been considered at a meeting of directors;
(b) if the officer becomes interested after a contract is made, forthwith after he becomes so interested; or
(c) if a person who is interested in a contract later becomes an officer, forthwith after he becomes an officer.
77(4)If a material contract or proposed material contract is one that, in the ordinary course of the corporation’s business, would not require approval by the directors or shareholders, a director or officer shall disclose in writing to the corporation or request to have entered in the minutes of meetings of directors the nature and extent of his interest forthwith after the director or officer becomes aware of the contract or proposed contract.
77(5)A director referred to in subsection (1) shall not be counted in the quorum, shall not be present and shall not vote at any meeting on any resolution to approve the contract unless the contract is
(a) an arrangement by way of security for money lent to or obligations undertaken by him for the benefit of the corporation or an affiliate;
(b) one relating primarily to his remuneration as a director, officer, employee or agent of the corporation or an affiliate;
(c) one for indemnity or insurance under section 81; or
(d) one with an affiliate.
77(6)For the purposes of this section, a general notice to the directors by a director or officer, declaring that he is a director or officer of or has a material interest in a person and is to be regarded as interested in any contract made with that person, is a sufficient declaration of interest in relation to any contract so made.
77(7)A director or officer referred to in subsection (1) is liable to account for any profit made on the contract, unless
(a) he disclosed his interest in accordance with subsections (2), (3) and (4);
(b) after such disclosure the contract was approved by the directors or the shareholders; and
(c) he establishes that the contract was reasonable and fair to the corporation at the time it was approved.
77(8)Where a director or officer of a corporation fails to comply with this section, the Court may, upon the application of the corporation or a shareholder of the corporation, set aside the contract on such terms as it thinks fit.
77(9)Notwithstanding anything in this section, a director or officer is not accountable to the corporation or its shareholders for any profit made on the contract
(a) if the contract is confirmed or approved by a majority of the votes cast by disinterested shareholders at a general meeting duly called for that purpose; and
(b) if the nature and extent of the director’s interest are declared and disclosed in reasonable detail in the notice calling the meeting.
77(10)This section does not apply to a director or officer of a corporation all of whose shares are owned by one person.
1983, c.15, s.13; 2000, c.9, s.7
Disclosure of interest of director or officer in contracts
77(1)A director or officer of a corporation who
(a) is a party to a material contract or proposed material contract with the corporation, or
(b) is a director or an officer of or has a material interest in any person who is a party to a material contract or proposed material contract with the corporation,
shall disclose in writing to the corporation or request to have entered in the minutes of meetings of directors the nature and extent of his interest.
77(2)The disclosure required by subsection (1) shall be made, in the case of a director,
(a) at the meeting at which a proposed contract is first considered;
(b) if the director was not then interested in a proposed contract, at the first meeting after he becomes so interested;
(c) if the director becomes interested after a contract is made, at the first meeting after he becomes so interested; or
(d) if a person who is interested in a contract later becomes a director, at the first meeting after he becomes a director.
77(3)The disclosure required by subsection (1) shall be made, in the case of an officer who is not a director,
(a) forthwith after he becomes aware that the contract or proposed contract is to be considered or has been considered at a meeting of directors;
(b) if the officer becomes interested after a contract is made, forthwith after he becomes so interested; or
(c) if a person who is interested in a contract later becomes an officer, forthwith after he becomes an officer.
77(4)If a material contract or proposed material contract is one that, in the ordinary course of the corporation’s business, would not require approval by the directors or shareholders, a director or officer shall disclose in writing to the corporation or request to have entered in the minutes of meetings of directors the nature and extent of his interest forthwith after the director or officer becomes aware of the contract or proposed contract.
77(5)A director referred to in subsection (1) shall not be counted in the quorum, shall not be present and shall not vote at any meeting on any resolution to approve the contract unless the contract is
(a) an arrangement by way of security for money lent to or obligations undertaken by him for the benefit of the corporation or an affiliate;
(b) one relating primarily to his remuneration as a director, officer, employee or agent of the corporation or an affiliate;
(c) one for indemnity or insurance under section 81; or
(d) one with an affiliate.
77(6)For the purposes of this section, a general notice to the directors by a director or officer, declaring that he is a director or officer of or has a material interest in a person and is to be regarded as interested in any contract made with that person, is a sufficient declaration of interest in relation to any contract so made.
77(7)A director or officer referred to in subsection (1) is liable to account for any profit made on the contract, unless
(a) he disclosed his interest in accordance with subsections (2), (3) and (4);
(b) after such disclosure the contract was approved by the directors or the shareholders; and
(c) he establishes that the contract was reasonable and fair to the corporation at the time it was approved.
77(8)Where a director or officer of a corporation fails to comply with this section, the Court may, upon the application of the corporation or a shareholder of the corporation, set aside the contract on such terms as it thinks fit.
77(9)Notwithstanding anything in this section, a director or officer is not accountable to the corporation or its shareholders for any profit made on the contract
(a) if the contract is confirmed or approved by a majority of the votes cast by disinterested shareholders at a general meeting duly called for that purpose; and
(b) if the nature and extent of the director’s interest are declared and disclosed in reasonable detail in the notice calling the meeting.
77(10)This section does not apply to a director or officer of a corporation all of whose shares are owned by one person.
1983, c.15, s.13; 2000, c.9, s.7