May et al. v. Circumpacific Energy Corp. et al., 2004 YKCA 1

• Judge: Rowles, Donald and Low, JJ.A.
• Court: Court of Appeal (Yukon Territory)
• Case Date: October 28, 2003
• Jurisdiction: Yukon
• Citations: 2004 YKCA 1;(2004), 191 B.C.A.C. 300 (YukCA)

May v. Circumpacific Energy (2004), 191 B.C.A.C. 300 (YukCA);

    314 W.A.C. 300

MLB headnote and full text

Temp. Cite: [2004] B.C.A.C. TBEd. JA.051

William May, Peter Weichler, Bert Peters, Robert Schiesser, Dan McCarthur and David Smiddy (respondents/petitioners) v. Circumpacific Energy Corporation (appellant/respondent) and Philip Francis Kelso, Charles E. Ross, Malcolm Fraser, Michael Silver and Graham Charles Reveleigh (respondents)

(YU00505; 2004 YKCA 1)

Indexed As: May et al. v. Circumpacific Energy Corp. et al.

Yukon Court of Appeal

Rowles, Donald and Low, JJ.A.

January 9, 2004.

Summary:

The petitioners held approximately two percent of the corporate respondent's stock. The petitioners brought oppression proceed­ings under s. 243 of the Business Corpora­tions Act. They sought relief, including the right to commence a derivative action. The petitioners sought the appointment of a monitor and injunctive relief.

The Yukon Supreme Court declined to grant the injunctive relief on the ground that the petitioners did not prove irreparable harm would result without such an order. The court did appoint a monitor as interim relief under s. 243(3) of the Act. The cor­poration appealed.

The Yukon Court of Appeal allowed the appeal and set aside the appointment of the monitor, without prejudice to future applica­tions for interim relief.

Company Law - Topic 2170.1

Shareholders - Shareholders' rights - Op­pressive acts - Remedies - Appoint­ment of monitor - The Yukon Court of Appeal held that the appointment of a monitor could not be made in oppression pro­ceed­ings under s. 243 of the Business Corpor­ations Act unless a finding of oppression was already made or, where an interim order was sought, a strong prima facie case of oppression was shown - The court must examine the evi­dence and find whether there was a prima facie case of oppressive conduct - The court could not order an investiga­tion merely to assist in determin­ing whether such a finding should be made - See paragraphs 26 to 51.

Company Law - Topic 7105

Fundamental changes and shareholders' rights - Appointment of receiver-manager or monitor - Circumstances when court will order appointment - [See Company Law - Topic 2170.1 ].

Company Law - Topic 9796.1

Actions against corporations and directors -Action for oppressive conduct - Interim relief - [See Company Law - Topic 2170.1 ].

Company Law - Topic 9798

Actions against corporations and directors -Action for oppressive conduct - Ap­point­ment of auditor, inspector or receiver - Appointment of monitor - [See Com­pany Law - Topic 2170.1 ]

Cases Noticed:

Ward v. Kostiew (1989), 42 B.C.L.R.(2d) 121 (C.A.), refd to. [para. 6].

Greka Energy Corp. v. Northsun Energy Ltd. (2001), 21 B.L.R.(3d) 10; 2001 YKSC 527, refd to. [para. 32].

Osborne v. Bucci et al. (1998), 75 O.T.C. 232 (Gen. Div.), consd. [para. 33].

Sileika v. Solcom Group Inc., [1993] O.J. No. 300 (Gen. Div.), consd. [para. 33].

Little et al. v. TGI-VMS Visual Based Perform­ance Systems Inc. et al., [2000] O.T.C. Uned. D04 (Sup. Ct.), consd. [para. 33].

HSBC Capital Canada Inc. v. First Mort­gage Alberta Fund (V) Inc. et al., [1999] 11 W.W.R. 281; 247 A.R. 37; 1999 ABQB 406, consd. [para. 33].

Ferguson v. Imax Systems Corp. et al. (1984), 4 O.A.C. 188; 47 O.R.(2d) 225 (Div. Ct.), agreed with [para. 50].

Statutes Noticed:

Business Corporations Act, R.S.Y. 2002, c. 20, sect. 243(2) [para. 9].

Authors and Works Noticed:

Bennett, Frank, Receiverships (2nd Ed. 1999), pp. 8, 9 [para. 31].

Counsel:

W.G. Hopkins, for the appellant;

B.G. Nemetz, Q.C., for the respondent.

This appeal was heard before Rowles, Donald and Low, JJ.A., of the Yukon Court of Appeal, at Vancouver, Brit­ish Columbia, on October 28, 2003. The deci­sion of the court was delivered on Jan­uary 9, 2004, by Rowles, J.A.