Law Times

Page 4 OctOber 24, 2016 • Law times www.lawtimesnews.com NEWS who does not receive a majority is not elected as a matter of law and, therefore, there is no need for them to submit a resignation and the board to rule on it. Andrew MacDougall, a part- ner with Osler Hoskin & Har- court LLP, says the proposed re- quirements could cause "failed elections" in which shareholders fail to elect enough directors to act. "You could have a situation where you don't have enough directors that have been elected to satisfy quorum requirements or the residency requirements or the minimum number of independent director require- ments under corporate and se- curities laws and, therefore, the board is unable to act," he says. Under the current system, MacDougall says, the board acts as a "safety valve" against that risk. The proposed amendments say that the majority voting stan- dards will not apply in "prescribed circumstances," and Longhurst says the lingering question for the regulations will be how clearly the regulations define the "pre- scribed circumstances." "The prescribed circum- stances that are going to be in the regulations will determine the all-important outcome of whether or not this practically has a difference," she says. She adds that, with today's system, it is up to the board to determine what are "exceptional circumstances" under the TSX rules. Longhurst says the proposed legislation could create different standards and potential inequal- ities for those TSX-listed com- panies that were incorporated under different jurisdictions. The provincial government has initiated a panel to look at modernizing Ontario's Business Corporations Act, but, in the meantime, Longhurst says there could be a "potential disconnect now between federally incorpor- ated corporations versus those incorporated under any other provincial statute." Another requirement the amendments would impose would be diversity disclosures. Under the proposed amend- ments, board of directors would have to submit annual divers- ity disclosure about the back- ground of the directors as well as senior management to share- holders. Boards will be required to provide their diversity rep- resentation and policies or ex- plain why none exist. MacDougall says it is con- sistent with the current require- ments of securities laws of most Canadian jurisdictions. MacDougall says it remains to be seen whether the regula- tions will require the same level of disclosure as the existing re- quirements. In Longhurst's view, the pro- posed amendments will likely modernize the CBCA in a way that is a standard in many other jurisdictions. The amendments will bring the act up to speed "with the legal reality that I think is viewed as not just a best practice but, increasingly, what should be a baseline practice," she says. LT Continued from page 1 Diversity disclosures necessary under proposed changes During the jury trial, the Crown asked Joyes: "And did you want to clear these charges up as soon as possible?" In response to this, Joyes stat- ed, "No. I left the jurisdiction, but I came all the way across Canada and turned myself in to the Lon- don Police station on my own ac- cord," according to the decision. The Crown then asked for the jury to be excused while he received permission from the trial judge, Superior Court Jus- tice Johanne Morissette, that he be allowed to ask Joyes about his post-arrest absence. Morissette gave the Crown permission to do so, saying Joyes could have responded with: "Yes, I wanted to," and by giving the answer he did, he put the matters into issue. The Crown then cross- examined Joyes about the period of time after his arrest, which included the fact that he failed to attend a preliminary court date. In closing, the Crown brought up the fact that Joyes left the province for six months. "My friend stated, in his argument, in his closing argu- ment that Mr. Joyes is innocent, he was honest and had nothing to hide," the Crown said, accord- ing to the decision. "Well, he hid himself for six months. Robert Joyes's version of what happened simply makes no sense at all." Morissette told the jury that finding Joyes guilty based on his post-arrest conduct would be wrong, but he did not caution the jury about using that infor- mation to assess his credibility, the decision said. The Court of Appeal deter- mined that the Crown's original question "opened the door" to Joyes' response concerning his post-arrest conduct and resulted in unfairness. "Crown counsel should not have asked the question in front of the jury without first vetting the question with the trial judge and giving counsel for the de- fence an opportunity to raise the propriety of the question," the court's decision said. The court determined that the evidence generated by the Crown's question created a high risk of prejudice as the trial turned on Joyes' credibility. Joyes was convicted in 2014 and sentenced to three years in prison. In his factum, the Crown attorney on the appeal, Brock Jones, said the fact that Joyes' post-arrest conduct was brought up was no basis for an appeal as the defendant himself admitted the evidence. Anthony Moustacalis, presi- dent of the Criminal Lawyers' Association, says the Crown was not to blame, as the trial judge should not have let the question- ing go ahead. "The trial judge got it wrong," he says. "Once you get a ruling in your favour, then the argument in closing naturally f lows." The Ministry of the Attorney General did not provide com- ment. LT Continued from page 1 Risk of prejudice? Start with Practical Law Canada – Personal Injury Litigation. Practical Law Canada – Personal Injury Litigation offers you continuously maintained, up-to-date resources that contain the legal know-how that personal injury and insurance defence lawyers need to practise more efficiently, improve client service and never miss a step. 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