Ontario Civil


Business Associations

Specific matters of corporate organization

Shareholders

Oppression remedy not designed to relieve from limited liquidity attached to shares

Siblings W, BD, and GD, through holding company shareholders, owned shares of family business S Ltd.. When W experienced financial hardship and wished to sell her interest in S Ltd., parties engaged in reorganization that resulted in W and her holding company selling only part of their interest. W and her holding company again wished to sell their interest in S Ltd., but BD and GD refused to purchase this interest. W and her holding company brought action against BD, GD, their holding companies, and S Ltd. for relief from oppression. Action dismissed. W and her holding company failed to establish any basis for relief sought under s. 248 of Business Corporations Act. W did not have reasonable expectation of liquidity for her shares in S Ltd.. W’s interest was received as gift at time when her father wanted business to remain in family for long term and wanted to provide disincentive for siblings to sell to third party. While shareholders agreement provided for right of first offer, agreement did not contain shotgun buy-sell clause or put right requiring shares to be purchased. Oppression remedy in s. 248 of Act was not designed to relieve minority shareholder from limited liquidity attached to his or her shares or to provide means of exiting corporation in absence of any oppressive or unfair conduct. W’s current financial circumstances were not in any way attributable to actions taken by any other parties. W’s interests were not being unfairly disregarded by dividend arrangements.

Wilfred v. Dare (2017), 2017 CarswellOnt 4111, 2017 ONSC 1633, Conway J. (Ont. S.C.J. [Commercial List]).

 


cover image

DIGITAL EDITION

Subscribers get early and easy access to Law Times.

Professional Development


Law Times Poll


A Law Times column argues it’s time for provincial laws dedicated to stopping defamatory publications on the Internet. Do you think that new legislation will help counter defamatory statements online?
RESULTS ❯