Dissident shareholders holding more than 5% of a public corporation sought orders under ss. 143 and 144 of the Canada Business Corporations Act requiring the board to call a shareholders’ meeting to remove and replace directors.
The court held the first requisition invalid because it was made by a beneficial rather than registered shareholder and failed to identify proposed director nominees.
Although a second requisition was valid, the directors were entitled to rely on the statutory exception in CBCA s. 143(3)(a) because a record date had already been fixed for an upcoming annual meeting.
While shareholders may in principle call a meeting under s. 143(4) even where a board relies on s. 143(3), the court declined to permit the proposed meeting in the circumstances due to delay by the applicants, limited prejudice from waiting for the scheduled AGM, and the costs of holding two meetings in close proximity.
