On January 21, 2015, in the midst of a contentious proxy battle
commenced by dissident shareholders of Aberdeen International Inc.
("Aberdeen"), Justice Wilton-Siegel of the Ontario
Superior Court of Justice dismissed the dissidents' motion for
relief in connection with a requisitioned shareholders meeting
scheduled for February 3, 2015 (the
"Meeting").1 Cassels Brock &
Blackwell LLP represented Aberdeen and certain of its directors and
officers in this matter.
Among the relief sought by the dissidents was the appointment of
an independent chair, a declaration that management's form of
proxy was invalid and a request that the Court intervene and impose
certain additional protocols related to the conduct of the
On the issue of the appointment of an independent chair, the Court
confirmed that the dissidents are required to provide evidence of
impropriety (such as a demonstrated serious conflict of interest or
a fettering of the chair's discretion) before the Court will
replace a proposed meeting chair – speculation and
expressions of concern are not sufficient. Moreover, the
Court confirmed that "taking sides in a contested proxy fight
is not, on its own, a basis for requiring an independent
chair." On the facts before him, Justice Wilton-Siegel
concluded that there were no circumstances to justify the
appointment of an independent chair in this case.
The Court also reviewed and considered the forms of proxy
submitted by both management and the dissidents. The Court found
that management's form of proxy conformed with the resolutions
proposed for the meeting and reflected the text of the resolutions
contemplated by the dissidents' requisition. The relief sought
by the dissidents would have, in effect, asked the Court to impose
a different resolution than was contained in the requisition. The
Court found that there was no basis to interfere in such a manner.
In addition, the Court recognized the importance of allowing
individual votes in respect of the incumbent directors being
challenged by the dissidents and found that it was the
dissidents' form of proxy that may lead to confusion,
preferring management's form of proxy.
Finally, the Court declined to intervene on certain technical and
other meeting protocol issues, including whether the
dissidents' slate complied with the company's by-laws, in
advance of the meeting and left such issues to be decided by the
chair of the meeting in the context of the actual voting
This decision confirms the high standard that dissident
shareholders will have to meet before a Court will take the
extraordinary step of interfering in advance of a shareholders
meeting. This decision follows previous decisions, including
Maudore Minerals Ltd. v. Harbour Foundation, 2012 ONSC
4255, which confirm that the appropriate course of action is to
await the results of the meeting before seeking relief from the
Courts unless there is clear evidence of wrongdoing.
Following Justice Wilton-Siegel's decision, and after proxy
results demonstrated significant support for the incumbent board,
the dissidents ultimately withdrew their request for the Meeting
along with the balance of their court application (which sought
broader relief than those issues raised on the motion) and agreed
to a five-year standstill agreement. The settlement with the
dissident shareholders was negotiated by Cassels Brock &
Blackwell LLP, counsel to Aberdeen together with Bennett Jones LLP,
counsel to the chairman of the board.
1 Meson Capital Partners, LLC v. Aberdeen
International Inc. , 2015 ONSC 532.
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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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