Home / Summaries / The Law and Business Administration in Canada / corporation-mind-rules

Corporate Governance: External Responsibilities

4 important questions on Corporate Governance: External Responsibilities

2 types of rules that protect creditors

1. Rules that prohibit any payment by the corporation to its shareholders that renders the corporations liquid assets insufficient to pay the claims of creditors
2. Rules that restrict the return of capital to shareholders even when the corporation might still be left with sufficient liquid assets to pay its creditors

3 responsibilities of securities commissions

1. The securities industry
2. The corporations offering their shares to the public
3. The stock exchange with the provinces

Indoor management rule

The principle that a person dealing with a corporation is entitled to assume that its internal procedural rules have been followed unless it is apparent that such is not the case

Directing mind principle

Corporate mens rea exists if a guilty mind can be found in an "active director" or the "directing mind or will" at "the centre of the personality of the corporation

The question on the page originate from the summary of the following study material:

The Law and Business Administration in Canada | 9780134841298 | James Everil Smyth, et al

View summary