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Alberta Law: A Case on Corporate Oppression

Oppression is a remedy available to stakeholders when they believe that corporate decisions have unfairly affected their interests. The Court looked at the issue of oppression in the case of Munter v. Gilchrist, 2020ABQB5959. With respect to oppression, the court said at paragraph 26:

[26] .... The first step is to examine the principles underlying the oppression remedy and to determine, in particular, the reasonable expectations of the complainant. The second is to determine whether the conduct in question amounts to oppression, unfair prejudice or unfair disregard. See also: 1216808 Alberta Ltd (Prairie Bailiff Services) v Devtex Ltd, 2014 ABCA 386 at paras 39-40.

[27] I note first of all that the reasonable expectation of stakeholders is a focal point in the oppression analysis because what is just and equitable depends on those expectations and the nature of the relationship between the parties. Although embodied in legislation, oppression remedies remain equitable by nature and therefore discretionary.

[28] In BCE, the Supreme Court of Canada listed seven factors, some or all of which may be present in a particular case for the purposes of defining a complainant’s reasonable expectations for the purposes of oppression:

• commercial practice or the normal business practices of the company;

• the nature of the corporation or the size, nature and structure of the company;

• the relationships between the corporate actors;

• past practice, including past corporate governance and operations;

• preventative steps or whether the alleged harm could have been avoided;

• representations and agreements such as shareholder agreements or representations made to stakeholders; and

• fair resolution of conflicting interests or whether the company’s best interests are advanced over competing interests.

There are a number of factors involved in an oppression claim, and it can be quite complex. If you believe you have suffered corporate oppression, please feel free to contact us.

The information contained in this article is not legal advice. No solicitor client relationship is formed through this article. The reader is encouraged to retain counsel for advice in these matters.

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