Matre et al. v. Crew Gold Corp., 2012 YKCA 9

JudgeSaunders, Low and D. Smith, JJ.A.
CourtCourt of Appeal (Yukon Territory)
Case DateSeptember 07, 2012
JurisdictionYukon
Citations2012 YKCA 9;(2012), 328 B.C.A.C. 193 (YukCA)

Matre v. Crew Gold Corp. (2012), 328 B.C.A.C. 193 (YukCA);

    558 W.A.C. 193

MLB headnote and full text

Temp. Cite: [2012] B.C.A.C. TBEd. OC.013

Certain Shareholders of Crew Gold Corporation, namely Jostein Matre, Rolf Matre, Bjorn Bremnes, Bjorn Rygge, Cahe Finans As, Dag Vidar Lorgen, Davilo Nuf, Frank Holmen, Geir Atle Leirvik, Gunnar H. Eide, Hans Petter Trondsen, Harald Lindahl, Marius Husby, Otto Bragge, Rune Sagebakken, Simon Brendhagen Jensen, Sky High Risk As, Stiftelsen P22 and Thure Trykk As (respondents/petitioners) v. Crew Gold Corporation (appellant/respondent)

(YU687; 2012 YKCA 9)

Indexed As: Matre et al. v. Crew Gold Corp.

Yukon Court of Appeal

Saunders, Low and D. Smith, JJ.A.

October 12, 2012.

Summary:

The Yukon Supreme Court, in a decision reported at [2011] Yukon Cases Uned. 75, granted the respondents, 19 beneficial and minority shareholders of Crew Gold Corporation, dissent rights under s. 193 of the Yukon Business Corporations Act when they had failed to register their shares. The chambers judge concluded that the shareholders' circumstances, wherein they failed to register their shares despite their intention to do so, were "exceptional" and fell within "the very limited category of cases" where beneficial shareholders should be relieved from compliance with the registration requirement. Crew appealed.

The Yukon Court of Appeal allowed the appeal.

Company Law - Topic 7017.2

Fundamental changes and shareholders' rights - Rights of minority or dissenting shareholders - Right to valuation of shares by court - Nonregistered beneficial shareholders - The Yukon Court of Appeal stated that "as a matter of law only registered shareholders are entitled to exercise dissent rights. This is not a 'technicality' but a legislative requirement to the exercise of a right of dissent [s. 193 of the Yukon Business Corporations Act]. The burden lies with the shareholder who seeks to exercise the right of dissent to ensure this requirement is met. Shareholders have been judicially relieved from this requirement only in exceptional circumstances where the conduct of a corporation has misled or amounted to a form of estoppel. The stated rationales for this rule are to: (i) prevent uncertainty; and (ii) avoid the undue burden that would be placed on corporations if they were unable to rely on their share register to determine who is entitled to exercise dissent rights." - See paragraph 35.

Company Law - Topic 7017.2

Fundamental changes and shareholders' rights - Rights of minority or dissenting shareholders - Right to valuation of shares by court - Nonregistered beneficial shareholders - The Yukon Court of Appeal discussed the legislative requirement to the exercise of a right of dissent - "Section 193 of the YBCA [Yukon Business Corporations Act] is clear in its intent: shareholders bear the responsibility for the registration of their shares. Absent conduct on the part of the corporation that may amount to a misrepresentation or estoppel, and provided the corporation has discharged any duty to clearly and accurately inform shareholders of their dissent rights, the corporation does not have a duty to provide shareholders with specific advice on how to register his or her shares. In each instance, that advice may be different depending on the nature and form in which the shareholdings are held. Advice that might extend beyond referring shareholders to information already disseminated to them or to their legal advisor and/or intermediary(ies), who are expressly tasked with the responsibility of advising the beneficial shareholders on this issue, in my view, would result in the imposition of a positive or affirmative duty on a corporation that could give rise to potential liability for inaccurate advice and would undermine the clear intention of the legislation that this burden lies with the shareholder." - See paragraph 42.

Company Law - Topic 7017.2

Fundamental changes and shareholders' rights - Rights of minority or dissenting shareholders - Right to valuation of shares by court - Nonregistered beneficial shareholders - The appellant company ("Crew") submitted that the chambers judge erred in granting the respondents, 19 beneficial and minority shareholders of Crew, dissent rights under s. 193 of the Yukon Business Corporations Act when they had failed to register their shares - The chambers judge had found that the respondents were confused and had made an honest effort to become dissenting shareholders - The respondents argued that this was one of the "very limited category of cases" where an overly strict adherence to the legislative requirements led to an intolerably unfair result - The Yukon Court of Appeal rejected the argument - "[S]hort of misleading and inaccurate information or conduct amounting to estoppel, in my view any gap in the legislation that results in an outcome that may be perceived as unfair is more appropriately dealt with by the legislature itself" - Crew fulfilled its responsibilities to the respondents by forwarding to their intermediary (a Norwegian bank) clear and accurate materials on the need for the beneficial shareholders to register their shares, and in referring the respondent who had assumed a leadership role to the Information Circular for advice - Crew's advice was neither misleading or reprehensible in some other way, nor could it be said to have amounted to estoppel - See paragraphs 50 and 51.

Cases Noticed:

Lake & Co. et al. v. Calex Resources Ltd. (1996), 187 A.R. 128; 127 W.A.C. 128; 139 D.L.R.(4th) 35 (C.A.), refd to. [para. 1].

Lay v. Genevest Inc., [2005] A.R. Uned. 218; 49 Alta. L.R.(4th) 40; 2005 ABQB 140, refd to. [para. 1].

Manitoba Securities Commission v. Versatile Cornat Corp., [1979] 2 W.W.R. 714; 97 D.L.R.(3d) 45 (M.B.Q.B.), refd to. [para. 2].

Westmin Resources Ltd. v. Hamilton et al., [1990] B.C.T.C. Uned. E54; [1991] 3 W.W.R. 716; 52 B.C.L.R.(2d) 333 (S.C.), refd to. [para. 2].

Wahlla et al. v. Delta Sunshine Taxi (1972) Ltd. et al. (2012), 317 B.C.A.C. 200; 540 W.A.C. 200; 2012 BCCA 80, refd to. [para. 44].

Statutes Noticed:

Business Corporations Act, R.S.Y. 2002, c. 20, sect. 193(4) [para. 2].

Counsel:

B. Kaplan, Q.C., and S. Boyle, for the appellant;

K. Carteri and M. Harmer, for the respondents.

This appeal was heard on September 7, 2012, at Vancouver, British Columbia, before Saunders, Low and D. Smith, JJ.A., of the Yukon Court of Appeal. In reasons written by D. Smith, J.A., the Court delivered the following judgment, dated October 12, 2012.

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2 practice notes
  • Sturm et al. v. Sprott Resource Lending Corp. et al., 2014 BCSC 190
    • Canada
    • Supreme Court of British Columbia (Canada)
    • February 6, 2014
    ...what can be considered minimal efforts to effect the share exchange. [85] In Certain Shareholders of Crew Gold Corp. v. Crew Gold Corp. , 2012 YKCA 9, the court addressed the exercise of dissent rights by shareholders who had failed to register their shares, which was a pre-condition to the......
  • Guang et al. v. WEX Pharmaceuticals Inc., [2013] B.C.T.C. Uned. 1949 (SC)
    • Canada
    • Supreme Court of British Columbia (Canada)
    • October 28, 2013
    ...misrepresentations or fraud, only registered shareholders are entitled to exercise dissent rights: Matre v. Crew Gold Corporation , 2012 YKCA 9; (b) the role of the court is to determine the fair value of the petitioners' shares. No party bears the onus of proving fair value: Nunachiaq at p......
2 cases
  • Sturm et al. v. Sprott Resource Lending Corp. et al., 2014 BCSC 190
    • Canada
    • Supreme Court of British Columbia (Canada)
    • February 6, 2014
    ...what can be considered minimal efforts to effect the share exchange. [85] In Certain Shareholders of Crew Gold Corp. v. Crew Gold Corp. , 2012 YKCA 9, the court addressed the exercise of dissent rights by shareholders who had failed to register their shares, which was a pre-condition to the......
  • Guang et al. v. WEX Pharmaceuticals Inc., [2013] B.C.T.C. Uned. 1949 (SC)
    • Canada
    • Supreme Court of British Columbia (Canada)
    • October 28, 2013
    ...misrepresentations or fraud, only registered shareholders are entitled to exercise dissent rights: Matre v. Crew Gold Corporation , 2012 YKCA 9; (b) the role of the court is to determine the fair value of the petitioners' shares. No party bears the onus of proving fair value: Nunachiaq at p......

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