Is there a high onus on good faith on a party seeking leave to bring a derivative action?
Ontario, Canada
The following excerpt is from Silver v. Imax Corporation, 2009 CanLII 72342 (ON SC):
Similarly, in Chandler v. Sun Life Financial Inc., [2006] O.J. No. 451 at paras. 25-26 (S.C.), C. Campbell J. recognized a “high onus” to establish good faith on a party seeking leave to bring a derivative action, noting that in the absence of evidence to the contrary there would be a presumption that the directors (in refusing to commence the proceedings on behalf of the company) have exercised reasonable and sound judgment and recognizing the risk of a collateral purpose on the part of the applicant shareholders.
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