Another significant potential area of personal liability for
directors and officers of business corporations in Ontario to
consider arises as a result of 200+ laws of all levels of
government that have provisions imposing personal liability in
prescribed situations. Speaking broadly, these laws fall into
several categories, including:
Taxation and revenue laws such as certain types of taxes
collected by a business and withholdings undertaken by employers on
behalf of government;
Employment laws such as obligations pertaining to wages and
Environmental protection and public health & safety laws
such as penalties for allowing or directing a breach of the
specific requirements of a law; and
Business and securities legislation such as duties on directors
and officers as they relate to actions of a corporation that impact
upon its shareholders and/or creditors.
Examples of ways in which personal liability may be attributed
to a director or officer under these laws include:
Making directors and/or officers personally liable for certain
financial obligations of a corporation such as collecting and
remitting taxes or relating to certain entitlements of employees
under employment laws; and
Quasi-criminal offences which may be committed when a
corporation's directors or officers are negligent or fail to
discharge their legal duties.
These are just a few of the reasons why prudent directors and
officers of corporations in Ontario should take steps to protect
against potential personal liabilities that arise by virtue of
In Ontario Securities Commission v. Tiffin, the Ontario Court of Justice clarified the limits of the definition of "securities" under s.1(1) of the Securities Act, as it relates to promissory notes. The defendant in the case was charged with trading in securities without being registered and while prohibited, and without filing a prospectus.
The OSC has issued a press release advising stakeholders that Ontario securities law may apply to any use of distributed ledger technologies, such as blockchain, as part of financial products or service offerings.
The use of electronic signatures is becoming increasingly commonplace in commercial transactions, as individuals and businesses capitalize on the administrative efficiency afforded by today’s digital world.
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