Chriss – Federal Court of Appeal finds that a written resignation must be signed and delivered to the corporation to start the two-year s. 227.1(4) period running

The husband of a director had instructed their law firm to prepare a written resignation for her, which they did, but the resignation form was never provided to her. In reversing a finding of Boyle J that this was sufficient to amount to a written resignation that started the two-year limitation period in s. 227.1(4) running, Rennie JA stated:

…In the absence of the communication of a written resignation to the corporation, a resignation is not effective. …

… Reliance on the subjective intention or say-so of a director alone would allow a director to plant the seeds of retroactive resignation, only to rely on it at some later date should a director-linked liability emerge. …[T]he dangers associated with allowing anything less than delivery of an executed and dated written resignation are unacceptable.

Given these strong words, he unsurprisingly went on to find that it was not a sufficient due diligence defence for the director to think that she had resigned.

Neal Armstrong. Summaries of The Queen v. Chriss, 2016 FCA 236 under s. 227.1(4) and s. 227.1(3).