Shareholders are the owners of shares of stock in a company. Being a shareholder comes with many rights. Shareholders vote on corporate decisions, elect the company’s board of directors, are able to sell their shares, and collect dividends from the company when they are declared. The shareholders are the owners of the company. Both private and publicly traded companies have shareholders.
As a shareholder, you have expectations of how the corporation will act. If your expectations are not met (and the court considers your expectations to be reasonable), and you have been prejudiced or had your interests disregarded, you can apply to the court for an order to stop the corporation’s actions via the oppression remedy.
The oppression remedy is a very powerful remedy. The oppression remedy is set out in section 248 of the Ontario Business Corporations Act (“OBCA”), which applies to corporations that are incorporated provincially in Ontario, and section 241 of the Canada Business Corporations Act (“CBCA”), which applies to corporations that are federally-incorporated.
The oppression remedy allows for a wide range of stakeholders, including shareholders, creditors, directors and officers to make an application to the court to remedy any of the corporation’s conduct that is unfairly prejudicial or disregards their interests.
The courts can intervene in the affairs of the corporation and make a variety of orders to stop the oppressive conduct in any way it seems fit. The OBCA and the CBCA give the courts a very wide range of discretion to deal with a corporation’s oppressive conduct.