As shareholder activism increases in Canada, the mechanics of
proxy disputes are becoming increasingly refined and more
frequently tested. In the recent decision of Northern Minerals
Investment Corp. v. Mundoro Capital Inc., 2012 BCSC 1090, the
Supreme Court of British Columbia considered two of the tools used
by issuers in connection with proxy contests:
- the implementation of an "advance notice policy",
And
- the postponement of a shareholder meeting.
In sustaining both initiatives by the Mundoro board, the court
reaffirmed the authority of boards to pursue such initiatives -
providing commentary on the principles that should inform
courts' approaches to the use of such tools in proxy fights and
the key factors that may influence the courts' views going
forward - and suggesting an inclination to support advance notice
by-laws and policies as a means of enhancing informed shareholder
choice.
