Tuesday May 26, 2015 – Rea v. Wildeboer, 2015 ONCA 373
Corporate Relief – How Derivative Actions and Oppression Remedies Don’t Always Go Hand in Hand
A case before the Ontario Court of Appeal dealt with the misappropriation of funds and a breach of fiduciary duties within a company, Martinrea International Inc. In order to understand the case, it’s important to know the term “derivative action”.
A derivative action allows for shareholders of a company to hold others responsible for any wrongdoing towards that company. In order to bring such a case before the court, it is important to get leave to apply.
This case specifically dealt with an oppression claim, which is related to a derivative action in that it also gives a shareholder or another applicant the ability to bring an application to the court, but in this case there is no need to apply for leave. Instead, an oppression claim alleges that wrongs have either been done to an individual by a corporation, or that the ways a corporation is being run are prejudicial or unfair. This type of claim is more common than a derivative action.
In this case, the judge did not side with the applicants; the appeals court also dismissed the appeal. The main issue was the attempt at proceeding with both a derivative action, which requires leave of the court, and an oppression claim, which does not and is largely a personal action. This case does not deal with a personal claim, but with a claim on behalf of a corporation.
Seek Legal Advice from an Experienced Civil Lawyer for Corporate Disputes
When dealing with corporate disputes, shareholders must carefully choose the right type of legal action, as not all claims can be mixed together. Given the complexities involved in corporate litigation, it is crucial to seek legal advice from a knowledgeable civil litigation lawyer. If you’re facing complicated and pressing corporate legal issues, book a legal consultation with a civil litigation lawyer at Karrass Law. An experienced lawyer can help you navigate the intricacies of corporate law, assess the strengths and weaknesses of your case, and develop a strategic approach tailored to your specific situation. Whether pursuing a derivative action, an oppression claim, or another legal remedy, professional guidance is essential to protect your interests and achieve a successful resolution.