104.1 In this Division, “officer-director”, in respect of a parent Crown corporation, means the chairperson and the chief executive officer of the corporation, by whatever name called.

1991, c. 24, s. 29; 2004, c. 16, s. 7.

105. (1) Each director, other than an officer-director, of a parent Crown corporation shall be appointed by the appropriate Minister, with the approval of the Governor in Council, to hold office during pleasure for such term, not exceeding three years, as will ensure, as far as possible, the expiration in any one year of the terms of office of not more than one-half of the directors of the corporation.

(2) The majority of the directors of a parent Crown corporation are not to be officers or employees of the corporation or any of its affiliates.

(3) A director of a parent Crown corporation is eligible for re-appointment on the expiration of his term of office.

(4) Despite subsection (1), if a director of a parent Crown corporation is not appointed to take office on the expiration of the term of an incumbent director, other than an officer-director, the incumbent director continues in office until his or her successor is appointed.

(5) Each officer-director of a parent Crown corporation shall be appointed by the Governor in Council to hold office during pleasure for such term as the Governor in Council considers appropriate.

(6) Before an officer-director of a parent Crown corporation is appointed, the appropriate Minister shall consult the board of directors of the corporation with respect to the appointment.

(7) Subject to any other Act of Parliament that was in force on September 1, 1984, the board of directors of a parent Crown corporation is responsible for the appointment of officers of the corporation, other than officer-directors.

(8) Nothing in this section is to be construed as empowering the appointment or re-appointment as a director or officer-director of a parent Crown corporation, or the continuation in office as a director of a parent Crown corporation, of any person who does not meet any qualifications for the appointment, re-appointment or continuation established by any other Act of Parliament.

(9) This section does not apply to an ex officio director or officer-director of a parent Crown corporation.

(10) [Repealed, 1991, c. 24, s. 30]

R.S., 1985, c. F-11, s. 105; R.S., 1985, c. 1 (4th Supp.), s. 44(E); 1991, c. 24, s. 30; 2004, c. 16, s. 8.

106. An act of a director, chairperson, chief executive officer or other officer of a parent Crown corporation is not invalid by reason only of an irregularity in his appointment or a defect in his qualifications.

R.S., 1985, c. F-11, s. 106; 2005, c. 30, s. 133(E).

107. (1) A resignation of a director, chairperson or chief executive officer of a parent Crown corporation becomes effective at the time the corporation receives a written resignation from him or at the time specified in the resignation, whichever is later.

(2) A parent Crown corporation shall send a copy of the resignation to the Clerk of the Privy Council within fifteen days after the parent Crown corporation receives it.

R.S., 1985, c. F-11, s. 107; 1991, c. 24, s. 31; 2005, c. 30, s. 133(E).

108. (1) The rate of any remuneration paid to a director, chairperson or chief executive officer of a parent Crown corporation for his services in respect of that office and, in the case of a chairperson or chief executive officer, any other office of the corporation or an affiliate thereof shall be fixed by the Governor in Council.

(2) Any benefits, other than remuneration, provided to a director, chairperson or chief executive officer of a parent Crown corporation for his services in respect of that office and, in the case of a chairperson or chief executive officer, any other office of the corporation or an affiliate thereof shall be fixed by the board of directors of the corporation in accordance with the regulations.

(2.1) The rate of any remuneration paid to a director, chairperson or chief executive officer of a wholly-owned subsidiary who is not also an officer-director of the parent Crown corporation for the director’s, chairperson's or officer’s services in respect of that subsidiary shall be fixed by the board of directors of the parent Crown corporation.

(3) For the purposes of this section, the Governor in Council may make regulations

(a) defining the term “remuneration”; and

(b) respecting the provision and fixing of benefits, other than remuneration, to or for any director, chairperson or chief executive officer.

R.S., 1985, c. F-11, s. 108; 1991, c. 24, s. 32; 2005, c. 30, s. 133(E).

109. Subject to this Part, the board of directors of a Crown corporation is responsible for the management of the businesses, activities and other affairs of the corporation.

1984, c. 31, s. 11.

110. (1) A resolution in writing, signed by all the directors of a Crown corporation entitled to vote on that resolution at a meeting of the board of directors or a committee of directors of the corporation is as valid as if it had been passed at a meeting of the board of directors or a committee of directors, as the case may be.

(2) A copy of every resolution referred to in subsection (1) shall be kept with the minutes of the proceedings of the board of directors or committee of directors, as the case may be.

1984, c. 31, s. 11.

111. (1) A director of a Crown corporation who is present at a meeting of the board of directors or a committee of directors of the corporation is deemed to have consented to any resolution passed or action taken at that meeting unless the director

(a) requests that written notice of his dissent be or written notice of his dissent is entered in the minutes of the meeting;

(b) gives written notice of his dissent to the secretary of the meeting before the meeting is adjourned; or

(c) sends written notice of his dissent by registered mail or delivers it to the head office of the corporation immediately after the meeting is adjourned.

(2) A director of a Crown corporation who votes for or consents to a resolution is not entitled to dissent in respect of that resolution pursuant to subsection (1).

1984, c. 31, s. 11.

112. A director of a Crown corporation who was not present at a meeting of the board of directors or a committee of directors of the corporation at which a resolution was passed or action taken is deemed to have consented thereto unless within seven days after becoming aware of the resolution or action the director

(a) causes written notice of his dissent to be placed with the minutes of the meeting; or

(b) sends written notice of his dissent by registered mail or delivers it to the head office of the corporation.

1984, c. 31, s. 11.

113. A director of a Crown corporation may, subject to the by-laws of the corporation, participate in a meeting of the board of directors or a committee of directors of the corporation by means of such telephone or other communications facilities as permit all persons participating in the meeting to hear each other, and a director participating in such a meeting by such means is deemed for the purposes of this Part to be present at the meeting.

1984, c. 31, s. 11.

114. (1) The board of directors of a parent Crown corporation may, by resolution, make, amend or repeal any by-laws that regulate the business or affairs of the corporation, unless the charter or by-laws of the corporation otherwise provide.

(2) The board of directors of a parent Crown corporation shall, after making, amending or repealing a by-law, send a copy of that by-law to the appropriate Minister and the President of the Treasury Board.

(3) The Governor in Council may direct the board of directors of a parent Crown corporation to make, amend or repeal a by-law within such period as is specified in the direction.

(4) The Governor in Council may make regulations

(a) prescribing the form or the content of by-laws of parent Crown corporations and the time at, before or within which copies of by-laws are to be sent to the appropriate Minister and the President of the Treasury Board; and

(b) exempting a specified parent Crown corporation or a parent Crown corporation of a specified class from the application of subsection (2), either generally or in respect of any specified by-law or any by-law of a specified class.

(5) No direction shall be given pursuant to subsection (3) to the Standards Council of Canada with respect to

(a) the manner in which voluntary standardization is promoted; or

(b) the provision of financial assistance to or for the benefit of a particular person or group of persons.

(6) Section 103 of the Canada Business Corporations Act does not apply in respect of any parent Crown corporation established under that Act.

R.S., 1985, c. F-11, s. 114; 1991, c. 24, s. 33; 1994, c. 24, s. 34(F).

115. (1) Every director and every officer of a Crown corporation in exercising his powers and performing his duties shall

(a) act honestly and in good faith with a view to the best interests of the corporation; and

(b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

(2) Every director and every officer of a parent Crown corporation or of a wholly-owned subsidiary of a parent Crown corporation shall comply with this Part, the regulations, the charter and by-laws of the corporation or subsidiary and any directive given to the corporation.

(3) A director or officer is not liable for a breach of his duty under subsection (1) or (2) if he relies in good faith on

(a) financial statements of the Crown corporation represented to him by an officer of the corporation or in a written report of the auditor of the corporation as fairly reflecting the financial condition of the corporation; or

(b) a report of a lawyer, accountant, engineer, appraiser or other person whose position or profession lends credibility to a statement made by him.

1984, c. 31, s. 11.

116. (1) A director or officer of a Crown corporation who

(a) is a party to a material contract or proposed material contract with the corporation, or

(b) is a director or officer of, or has a material interest in any person who is a party to, a material contract or proposed material contract with the corporation,

shall disclose in writing to the corporation or request to have entered in the minutes of a meeting of the board of directors thereof the nature and extent of his interest.

(2) The disclosure required by subsection (1) shall be made, in the case of a director,

(a) at the meeting of the board of directors at which the proposed contract is first considered;

(b) if the director was not then interested in the proposed contract, at the first meeting of the board of directors after he becomes so interested;

(c) if the director becomes interested after the contract is made, at the first meeting of the board of directors after he becomes so interested; or

(d) if the director was interested in the contract before becoming a director, at the first meeting of the board of directors after he becomes a director.

(3) The disclosure required by subsection (1) shall be made, in the case of an officer who is not a director,

(a) forthwith after he becomes aware that the contract or proposed contract is to be considered or has been considered at a meeting of the board of directors;

(b) if the officer becomes interested after the contract is made, forthwith after he becomes so interested; or

(c) if the officer was interested in the contract before becoming an officer, forthwith after he becomes an officer.

(4) If a material contract or proposed material contract is one that, in the ordinary course of the business or activity of the Crown corporation, would not require approval by the board of directors, a director or officer shall disclose in writing to the corporation or request to have entered in the minutes of a meeting of the board of directors the nature and extent of his interest forthwith after the director or officer becomes aware of the contract or proposed contract.

(5) A director referred to in subsection (1) shall not vote on any resolution to approve the contract unless the contract is

(a) an arrangement by way of security for money lent to or obligations undertaken by him for the benefit of the Crown corporation or a subsidiary of the Crown corporation;

(b) one relating primarily to his remuneration or benefits as a director, officer, employee or agent of the Crown corporation or a subsidiary of the Crown corporation;

(c) one for indemnity or insurance under section 119; or

(d) one with an affiliate of the Crown corporation.

(6) For the purposes of this section, a general notice to the board of directors by a director or officer, declaring that he is a director or officer of or has a material interest in a person and is to be regarded as interested in any contract made with that person, is a sufficient declaration of interest in relation to any contract so made.

(7) In this section and section 117, “board of directors” includes a committee of directors.

1984, c. 31, s. 11.

117. A material contract between a Crown corporation and one or more of its directors or officers, or between a Crown corporation and another person of which a director or an officer of the Crown corporation is a director or an officer or in which he has a material interest, is neither void nor voidable by reason only of that relationship or by reason only that a director with an interest in the contract is present at or is counted to determine the presence of a quorum at a meeting of the board of directors that authorized the contract, if the director or officer disclosed his interest in accordance with subsection 116(2), (3), (4) or (6), as the case may be, and the contract was approved by the board of directors and it was reasonable and fair to the Crown corporation at the time it was approved.

1984, c. 31, s. 11.

118. (1) Where a director or an officer of a Crown corporation fails to disclose his interest in a material contract in accordance with section 116, a court may, on application of the corporation or on behalf of the Crown, set aside the contract on such terms as it thinks fit.

(2) In this section, “court” means

(a) in the Province of Prince Edward Island or Newfoundland, the trial division of the Supreme Court of the Province;

(a.1) in the Province of Ontario, the Superior Court of Justice;

(b) in the Province of Quebec, the Superior Court of the Province;

(c) in the Province of New Brunswick, Manitoba, Saskatchewan or Alberta, the Court of Queen’s Bench for the Province;

(d) in the Provinces of Nova Scotia and British Columbia, the Supreme Court of the Province; and

(e) in Yukon or the Northwest Territories, the Supreme Court, and in Nunavut, the Nunavut Court of Justice.

R.S., 1985, c. F-11, s. 118; R.S., 1985, c. 27 (2nd Supp.), s. 10; 1990, c. 17, s. 19; 1992, c. 51, s. 49; 1998, c. 30, ss. 13(F), 15(E); 1999, c. 3, s. 63; 2002, c. 7, s. 172(E).

119. (1) The Treasury Board shall indemnify a present or former director or officer of a Crown corporation or a person who acts or acted at the request of a Minister or a Crown corporation as a director or officer of another corporation, and the director’s or officer’s heirs and legal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, that are reasonably incurred by the director or officer in respect of any civil, criminal or administrative action or proceeding to which the director or officer is a party by reason of being or having been such a director or officer, if the director or officer

(a) acted honestly and in good faith with a view to the best interests of the Crown corporation or other corporation; and

(b) in the case of any criminal or administrative action or proceeding that is enforced by a monetary penalty, believed on reasonable grounds that the director’s or officer’s conduct was lawful.

(2) Notwithstanding anything in this section, a director or officer referred to in subsection (1) is, and the heirs and legal representatives of the director or officer are, entitled to indemnity from the Treasury Board in respect of all costs, charges and expenses reasonably incurred by the director or officer in connection with the defence of any civil, criminal or administrative action or proceeding to which the director or officer was made a party by reason of being or having been such a director or officer, if the director or officer

(a) was substantially successful on the merits of the defence of the action or proceeding; and

(b) fulfils the conditions set out in paragraphs (1)(a) and (b).

(3) The Treasury Board may make regulations specifying terms and conditions governing indemnification under this section.

(4) Any amount payable in respect of indemnification under this section may be paid out of the Consolidated Revenue Fund.

R.S., 1985, c. F-11, s. 119; 1991, c. 24, s. 34; 1999, c. 31, s. 115(F).