What is the test for "good faith" in a derivative proceeding?
British Columbia, Canada
The following excerpt is from G&G Education Development Corporation v Langley Flying School, Inc., 2018 BCSC 1796 (CanLII):
The onus is on the applicant to adduce evidence to establish that the derivative proceeding is being brought in good faith. The test is stated by Mr. Justice Pearlman in Luft v. Ball, 2013 BCSC 574 at para 46: The test of good faith is whether the action is brought primarily for the purpose of pursuing the claim on the company's behalf. The factors to be considered include the applicant's belief in the merits of the proposed claim, existing disputes between the parties, and alleged ulterior motives.
"The most advanced legal research software ever built."
The above passage should not be considered legal advice. Reliable answers to complex legal questions require comprehensive research memos. To learn more visit www.alexi.com.
Other Questions
What is the test of good faith in bringing an action in good faith? (British Columbia, Canada)
Is there any case law or precedent for the issue of good faith in a commercial real estate proceeding? (British Columbia, Canada)
Does a party seeking derivative relief need to prove that it is in good faith? (British Columbia, Canada)
Can a class proceeding be the basis for a legal proceeding if the claims presented in that proceeding cannot be sustained individually? (British Columbia, Canada)
Is there a breach of good faith and fair dealing? (British Columbia, Canada)
Does a finding of bad faith on the part of the spouse in a claim for imputation of income for intentional unemployment or under employment require bad faith? (British Columbia, Canada)
What is the test for a claim for breach of good faith under a life insurance policy? (British Columbia, Canada)
What is the test for the presumption of good faith and the question of deference? (British Columbia, Canada)
What is the current state of the law on good faith decisions by a plaintiff to mitigate their loss? (British Columbia, Canada)
What is the "ordinary person" standard for determining whether a plaintiff acted in good faith and to the best of his own judgment? (British Columbia, Canada)
