The applicant, a not-for-profit corporation, sought declarations validating the election of its board of directors and the subsequent removal of two former directors.
The respondent former directors challenged their removal, arguing that the board's temporary retirement at the annual general meeting left the corporation without members to re-elect them, and that they were denied procedural fairness.
The court rejected the respondents' literal interpretation of the by-laws to avoid commercial absurdity, finding the board was properly elected.
The court also held that the respondents received adequate notice and were not denied natural justice.
The applicant's application was granted.