Insurance Companies Act

Marginal note:Avoidance standards

• 214 (1) A contract or transaction for which disclosure is required under subsection 211(1) is not invalid and a director or officer is not accountable to the company or its shareholders or policyholders for any profit realized from it by reason only of the director’s or officer’s interest in the contract or transaction or the fact that the director was present or was counted to determine whether a quorum existed at the meeting of directors, or of a committee of directors, that considered it if

  • (a) the director or officer disclosed their interest in accordance with section 211 and subsection 213(1);

  • (b) the directors approved the contract or transaction; and

  • (c) the contract or transaction was reasonable and fair to the company at the time that it was approved.

• Marginal note:Confirmation by shareholders and policyholders

  (2) Even if the conditions set out in subsection (1) are not met, a director or officer acting honestly and in good faith is not accountable to the company or its shareholders or policyholders for any profit realized from a contract or transaction for which disclosure was required and the contract or transaction is not invalid by reason only of the director’s or officer’s interest in it if

  • (a) the contract or transaction is approved or confirmed by special resolution at a meeting of shareholders and policyholders;

  • (b) disclosure of the interest was made to the shareholders and to the policyholders entitled to vote in a manner sufficient to indicate its nature before the contract or transaction was approved or confirmed; and

  • (c) the contract or transaction was reasonable and fair to the company at the time that it was approved or confirmed.