Canada: The Confidentiality Of Minutes Of Board Of Directors Meetings

You are a director of a private corporation, and one of the shareholders has asked you to provide him with the minutes of the last meeting of the board of directors. Are you legally obliged to provide this document to him?

A. The statutory provisions

First of all, the Canada Business Corporations Act¹ (the "CBCA") provides that minutes of board meetings may be examined only by the directors of the corporation. The same is true of Quebec's Business Corporations Act² (the "QBCA") which states that only the directors and the auditor of the corporation may have access to the records containing the minutes of meetings of the board and its committees and copies of the resolutions passed by the directors. In addition, the minutes of board meetings are not among the documents that may be examined by the corporation's shareholders under both the CBCA and the QBCA³. As for not-for-profit organizations governed by Part III of the Companies Act⁴, the minutes of board meetings are also not among the records that the organization's members may have access to.

B. Confidentiality of minutes

Quebec courts have already considered this issue. In its decision in Germain v. L.D.G. Inc.⁵ the Court of Appeal stated that the minutes of directors' meetings are part of the company's administrative and operational books and records. The Court specified that such documents are related to the internal administration of the company and are for the use of the directors in office. The Court was thus of the view that access to such books and records is limited to the currently serving directors.

In its decision in Roch Harnois & associés Inc.⁶, a bankruptcy matter, the Superior Court arrived at the same conclusion as the Court of Appeal: a shareholder has no right to examine the minutes of board meetings or the resolutions adopted by the directors. And as the trustee-in-bankruptcy has no more rights than the bankrupt does, the trustee is not entitled to have access to those documents.

In another Superior Court decision⁷, a member of a not-for-profit organization sought a declaratory judgment to the effect that he was entitled to have access to the minutes of the meetings of the organization's board of directors. Notwithstanding the principles enunciated by the Court of Appeal and the Superior Court in the two decisions canvassed above, the Court in this case held that in exceptional cases where an organization is being sued, a court may compel the disclosure of the minutes if they are central to the resolution of the dispute. However, the Court decided that the instant matter was not one of those exceptional cases.

It should be pointed out however that there are exceptions under both the CBCA⁸ and the QBCA⁹ with respect to corporate business in which a director has a personal interest. In such cases, a shareholder of the corporation may examine the portions of any minutes of meetings of directors or committees of directors that contain disclosures about a director's interest in a contract or transaction to which the corporation is a party, as well as any other documents containing such disclosures.

C. Admissibility of minutes at trial

While generally only the corporation's directors can examine the minutes of board meetings, this does not mean that such documents must be considered confidential¹⁰. As the Court pointed out in Payette v. Viel¹¹, in specific cases where the corporation is being sued, the Court may order the filing of board minutes into evidence. By way of example, in the matter of M.L. v. Compagnie A¹², Quebec's access to information commission ordered the company to disclose to the plaintiff portions of the minutes of meetings of its board that contained personal information concerning the plaintiff.

D. Conclusion

It is thus evident from the applicable statutory provisions and the case law that, subject to certain exceptions involving a director's personal interest, a shareholder of a corporation is generally not entitled to have access to the minutes of meetings of its board of directors. However, in certain situations, the courts may order that portions of the minutes be provided to the shareholder.

Footnotes

1 RSC 1985, c. C-44, s. 20 (4)

12 2010 QCCAI 73

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.