Harbour Authority Model By-law (2) - Full By-Laws

There are only two by-law provisions that are mandatory under the NFP Act. At a minimum, a corporation’s by-laws need to address the following:

  • Conditions required for membership (see explanation below)
  • Notice of meetings to members who are entitled to vote at the meeting (see explanation below)

If there are no other provisions in the by-laws, the default rules will automatically apply. If the needs of your corporation are met by the default rules and you only need the 2 mandatory provisions, you may wish to use the Harbour Authority Model By-laws (1) – Mandatory Provisions. If you need to change 1 or more of the default rules, then you should use this document – Full By-laws.

Please note that although this template includes the “full set” of by-laws, you only need to change the default rules that don’t meet the needs of your corporation, if the others apply, there is no requirement to include them in this set.

Membership Conditions (Clause 2.01)

  1. These must be the same as what you submitted to Industry Canada in the corporation’s Articles of Continuance.

  2. What to consider when considering membership conditions for your Harbour Authority:
    • How many members should have a vote?
    • Do you want to have voting and non-voting members?
    • How many classes of members are required?
    • Consider what types of groups/ representation from the community, municipality, recreational boaters, local business, etc. you would like involved in the Harbour Authority.
    • Can you provide a membership list (names and addresses) for all of your members?
    • Is your membership wide enough to include various interests in the Harbour Authority?
  3. The last clause is standard and the paragraphs mentioned above are outlined in the Act and deal with the following: 197(1) (e) – change of condition required for being a member; (h) – add, change or remove a provision respecting the transfer of membership; (l) – change the manner of giving notice to members entitled to vote at a meeting of members; and (m) – change the method of voting by members not in attendance at a meeting of members.

Notice of Members Meetings (Clause 2.03)

Notice of Members Meeting is one of the two by-law provisions that are MANDATORY under the NFP Act. Things to consider:

  • how you typically communicate with your members?
  • Mail, courier, personal delivery
  • Telephone
  • Electronically (e-mail, Facebook, website, etc.)
  • Notice boards
  • Local newspaper

If you require any additional information Industry Canada has produced a very useful “Transition Guide”.

Please consult “Step 3” of this guide for information related to By-Laws.

A by-law relating generally to the conduct of the affairs of (the "insert name of Harbour Authority")

Table of Contents

BE IT ENACTED as a by-law of the Corporation as follows:

Section 1 - General

1.01 Definitions

Suggested wording for standard recommended clause:

In this by-law and all other by-laws of the Corporation, unless the context otherwise requires:

"Act" means the Canada Not-For-Profit Corporations Act S.C. 2009, c.23 including the Regulations made pursuant to the Act, and any statute or regulations that may be substituted, as amended from time to time;

"Articles" means the original or restated articles of incorporation or articles of amendment, amalgamation, continuance, reorganization, arrangement or revival of the Corporation;

"Board" means the board of directors of the Corporation and "director" means a member of the board;

"By-law" means this by-law and any other by-law of the Corporation as amended and which are, from time to time, in force and effect;

"Meeting of members" includes an annual meeting of members or a special meeting of members; "special meeting of members" includes a meeting of any class or classes of members and a special meeting of all members entitled to vote at an annual meeting of members;

"Ordinary resolution" means a resolution passed by a majority of not less than 50% plus 1 of the votes case on that resolution;

"Proposal" means a proposal submitted by a member of the Corporation that meets the requirements of section 163 (Shareholder Proposals) of the Act;

"Regulations" means the regulations made under the Act, as amended, restated or in effect from time to time; and

"Special resolution" means a resolution passed by a majority of not less than two-thirds (2/3) of the votes cast on that resolution.

1.02 Interpretation

Suggested wording for standard recommended clause:

In the interpretation of this by-law, words in the singular include the plural and vice-versa, words in one gender include all genders, and "person" includes an individual, body corporate, partnership, trust and unincorporated organization.

Other than as specified above, words and expressions defined in the Act have the same meanings when used in these by-laws.

1.03 Corporate Seal

Suggested wording for standard recommended clause:

The Corporation may have a corporate seal in the form approved from time to time by the board. If a corporate seal is approved by the board, the secretary of the Corporation shall be the custodian of the corporate seal.

1.04 Execution of Documents

Suggested wording for standard recommended clause:

Deeds, transfers, assignments, contracts, obligations and other instruments in writing requiring execution by the Corporation may be signed by any two (2) of its officers or directors. In addition, the board may from time to time direct the manner in which and the person or persons by whom a particular document or type of document shall be executed. Any person authorized to sign any document may affix the corporate seal (if any) to the document. Any signing officer may certify a copy of any instrument, resolution, by-law or other document of the Corporation to be a true copy thereof.

1.05 Financial Year End

Suggested wording for standard recommended clause:

The financial year end of the Corporation shall be <insert month and day> of each year.

1.06 Banking Arrangements

Suggested wording for standard recommended clause:

The banking business of the Corporation shall be transacted at such bank, trust company or other firm or corporation carrying on a banking business in Canada or elsewhere as the board of directors may designate, appoint or authorize from time to time by resolution. The banking business or any part of it shall be transacted by an officer or officers of the Corporation and/or other persons as the board of directors may by resolution from time to time designate, direct or authorize.

1.07 Borrowing Powers (Default Rule)

Suggested wording for default rule:

The directors of the Corporation may, without authorization of the members,

  1. borrow money on the credit of the corporation;
  2. issue, reissue, sell, pledge or hypothecate debt obligations of the corporation;
  3. give a guarantee on behalf and
  4. mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the corporation, owned or subsequently acquired, to secure any debt obligation of the corporation.

Suggested wording for alternate rule:

If authorized by a by-law which is duly adopted by the directors and confirmed by ordinary resolution of the members, the directors of the corporation may from time to time:

  1. borrow money on the credit of the corporation;
  2. issue, reissue, sell, pledge or hypothecate debt obligations of the corporation; and
  3. mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the corporation, owned or subsequently acquired, to secure any debt obligation of the corporation.

Any such by-law may provide for the delegation of such powers by the directors to such officers or directors of the corporation to such extent and in such manner as may be set out in the by-law.

1.08 Annual Financial Statements (Default Rule)

Suggested wording for default rule:

The Corporation shall send to the members a copy of the annual financial statements and other documents referred to in subsection 172(1) (Annual Financial Statements) of the Act or a copy of a publication of the Corporation reproducing the information contained in the documents. Instead of sending the documents, the Corporation may send a summary to each member along with a notice informing the member of the procedure for obtaining a copy of the documents themselves free of charge. The Corporation is not required to send the documents or a summary to a member who, in writing, declines to receive such documents.

Suggested wording for alternate rule:

The Corporation may, instead of sending copies of the annual financial statements and other documents referred to in subsection 172(1) (Annual Financial Statements) of the Act to the members, publish a notice to its members stating that the annual financial statements and documents provided in subsection 172(1) are available at the registered office of the Corporation and any member may, on request, obtain a copy free of charge at the registered office or by prepaid mail.

Section 2 - Membership - Matters Requiring Special Resolution

2.01 Membership Conditions

1. Membership Conditions

OPTION for ONE membership class composed of individuals, corporations and other entities which are all considered "persons".

Suggested wording for a Harbour Authority with one (1) class of membership made up of commercial fishers:

Subject to the articles, there shall be one class of members in the Corporation made up of <commercial fishers>. Membership in the Corporation shall be available to persons interested in furthering the Corporation's purposes and who have applied for and been accepted into membership in the Corporation by resolution of the board or in such other manner as may be determined by the board. Each member shall be entitled to receive notice of, attend and vote at all meetings of the members of the Corporation.

Pursuant to subsection 197(1) (Fundamental Change) of the Act, a special resolution of the members is required to make any amendments to this section of the by-laws if those amendments affect membership rights and/or conditions described in paragraphs 197(1)(e), (h), (l) or (m).

OPTION for two or more membership classes composed of individuals, corporations and other entities which are all considered "persons".

Suggested wording for three classes of membership:

  • Class A: commercial fishers – voting
  • Class B: recreational boaters - voting
  • Class C: Others – Non voting

You may wish to define the classes (i.e. who are commercial fishers, who are recreational boaters, etc.)

Subject to the articles, there shall be three classes of members in the Corporation, namely, Class A members, Class B and Class C members. The board of directors of the Corporation may, by resolution, approve the admission of the members of the Corporation. Members may also be admitted in such other manner as may be prescribed by the board by resolution. The following conditions of membership shall apply:

Class A Members (VOTING)
  1. Class A voting membership shall be available to persons who are < commercial fishers> and who have applied and have been accepted for Class A voting membership in the Corporation.
  2. The term of membership of a Class A voting member shall be annual, subject to renewal in accordance with the policies of the Corporation.
  3. As set out in the articles, each Class A voting member is entitled to receive notice of, attend and vote at all meetings of members and each such Class A voting member shall be entitled to X vote(s) at such meetings.
Class B Members (VOTING)
  1. Class B voting membership shall be available to persons who are <recreational boaters> and who have applied and have been accepted for Class A voting membership in the Corporation.
  2. The term of membership of a Class B voting member shall be annual, subject to renewal in accordance with the policies of the Corporation.
  3. As set out in the articles, each Class B voting member is entitled to receive notice of, attend and vote at all meetings of members and each such Class B voting member shall be entitled to X vote(s) at such meetings.
Class C Members (NON-VOTING)
  1. Class C non-voting membership shall be available to <other persons> who have applied and have been accepted for Class C non-voting membership in the Corporation.
  2. The term of membership of a Class C non-voting member shall be annual, subject to renewal in accordance with the policies of the Corporation.
  3. Subject to the Act and the articles, a Class C non-voting member shall be entitled to receive notice of, attend but NOT entitled to vote at meetings of the members of the Corporation.

Pursuant to subsection 197(1) (Fundamental Change) of the Act, a special resolution of the members is required to make any amendments to this section of the by-laws if those amendments affect membership rights and/or conditions described in paragraphs 197(1)(e), (h), (l) or (m).

2.02 Membership Transferability (Default Rule)

Suggested wording for default rule:

A membership may only be transferred to the Corporation. Pursuant to Section 197(1) (Fundamental Change) of the Act, a special resolution of the members is required to make any amendment to add, change or delete this section of the by-laws.

2.03 Notice of Members Meeting

Suggested wording for a Harbour Authority who communicates by mail, courier, personal delivery, telephone or electronic means:

Notice of the time and place of a meeting of members shall be given to each member entitled to vote at the meeting by the following means:

  1. by mail, courier or personal delivery to each member entitled to vote at the meeting, during a period of 21 to 60 days before the day on which the meeting is to be held; or
  2. by telephonic, electronic or other communication facility to each member entitled to vote at the meeting, during a period of 21 to 35 days before the day on which the meeting is to be held.

Pursuant to subsection 197(1) (Fundamental Change) of the Act, a special resolution of the members is required to make any amendment to the by-laws of the Corporation to change the manner of giving notice to members entitled to vote at a meeting of members.

2.04 Members’ Meeting (Default Rule)

Suggested wording for default rule:

The board of directors shall call a special meeting of members in accordance with Section 167 of the Act, on written requisition of members carrying not less than 5% of the voting rights. If the directors do not call a meeting within twenty-one (21) days of receiving the requisition, any member who signed the requisition may call the meeting.

Section 3 - Membership Dues, Termination and Discipline

3.01 Membership Dues

Suggested wording for standard recommended clause (if applicable):

Members shall be notified in writing of the membership dues at any time payable by them and, if any are not paid within one (1) calendar month of the membership renewal date the members in default shall automatically cease to be members of the Corporation.

3.02 Absentee Voting at Members' Meetings (Default Rule)

Suggested wording for alternate rule mailed in ballot:

Pursuant to section 171(1) (Absentee Voting) of the Act, a member entitled to vote at a meeting of members may vote by mailed-in ballot if the Corporation has a system that:

  1. enables the votes to be gathered in a manner that permits their subsequent verification, and
  2. permits the tallied votes to be presented to the Corporation without it being possible for the Corporation to identify how each member voted.

Pursuant to subsection 197(1) (Fundamental Change) of the Act, a special resolution of the members is required to make any amendment to the by-laws of the Corporation to change this method of voting by members not in attendance at a meeting of members.

Suggested wording for alternate rule electronic ballot:

Pursuant to section 171(1) (Absentee Voting) of the Act, a member entitled to vote at a meeting of members may vote by means of a telephonic, electronic or other communication facility if the Corporation has a system that:

  1. enables the votes to be gathered in a manner that permits their subsequent verification, and
  2. permits the tallied votes to be presented to the Corporation without it being possible for the Corporation to identify how each member voted.

Pursuant to subsection 197(1) (Fundamental Change) of the Act, a special resolution of the members is required to make any amendment to the by-laws of the Corporation to change this method of voting by members not in attendance at a meeting of members.

Suggested wording for alternative rule mailed in or electronic ballot:

Pursuant to section 171(1) (Absentee Voting) of the Act, a member entitled to vote at a meeting of members may vote by mailed-in ballot or by means of a telephonic, electronic or other communication facility if the Corporation has a system that:

  1. enables the votes to be gathered in a manner that permits their subsequent verification, and
  2. permits the tallied votes to be presented to the Corporation without it being possible for the Corporation to identify how each member voted.
    Pursuant to subsection 197(1) (Fundamental Change) of the Act, a special resolution of the members is required to make any amendment to the by-laws of the Corporation to change this method of voting by members not in attendance at a meeting of members.

Suggested wording for alternative rule option by proxy:

Pursuant to Section 171(1) of the Act, a member entitled to vote at a meeting of members may vote by proxy by appointing in writing a proxy holder, and one or more alternate proxy holders, who are not required to be members, to attend and act at the meeting in the manner and to the extent authorized by the proxy and with the authority conferred by it subject to the following requirements:

  1. a proxy is valid only at the meeting in respect of which it is given or at a continuation of that meeting after an adjournment;
  2. a member may revoke a proxy by depositing an instrument or act in writing executed or, in Quebec, signed by the member or by their agent or mandatory
    1. at the registered office of the corporation no later than the last business day preceding the day of the meeting, or the day of the continuation of that meeting after an adjournment of that meeting, at which the proxy is to be used, or
    2. with the chairperson of the meeting on the day of the meeting or the day of the continuation of that meeting after an adjournment of that meeting;
  3. a proxy holder or an alternate proxy holder has the same rights as the member by whom they were appointed, including the right to speak at a meeting of members in respect of any matter, to vote by way of ballot at the meeting, to demand a ballot at the meeting and, except where a proxy holder or an alternate proxy holder has conflicting instructions from more than one member, to vote at the meeting by way of a show of hands;
  4. if a form of proxy is created by a person other than the member, the form of proxy shall
    1. indicate, in bold-face type,
      1. the meeting at which it is to be used,
      2. that the member may appoint a proxy holder, other than a person designated in the form of proxy, to attend and act on their behalf at the meeting, and
      3. instructions on the manner in which the member may appoint the proxy holder,
    2. contain a designated blank space for the date of the signature,
    3. provide a means for the member to designate some other person as proxy holder, if the form of proxy designates a person as proxy holder,
    4. provide a means for the member to specify that the membership registered in their name is to be voted for or against each matter, or group of related matters, identified in the notice of meeting, other than the appointment of a public accountant and the election of directors,
    5. provide a means for the member to specify that the membership registered in their name is to be voted or withheld from voting in respect of the appointment of a public accountant or the election of directors, and
    6. state that the membership represented by the proxy is to be voted or withheld from voting, in accordance with the instructions of the member, on any ballot that may be called for and that, if the member specifies a choice under subparagraph (iv) or (v) with respect to any matter to be acted on, the membership is to be voted accordingly;
  5. a form of proxy may include a statement that, when the proxy is signed, the member confers authority with respect to matters for which a choice is not provided in accordance with subparagraph (d)(iv) only if the form of proxy states, in bold-face type, how the proxy holder is to vote the membership in respect of each matter or group of related matters;
  6. if a form of proxy is sent in electronic form, the requirements that certain information be set out in bold-face type are satisfied if the information in question is set out in some other manner so as to draw the addressee's attention to the information; and
  7. a form of proxy that, if signed, has the effect of conferring a discretionary authority in respect of amendments to matters identified in the notice of meeting or other matters that may properly come before the meeting must contain a specific statement to that effect.

Pursuant to Section 197(1) of the Act, a special resolution of the members (and if Section 199 applies, a special resolution of each class of members) is required to make any amendment to the articles or by-laws of the Corporation to change this method of voting by members not in attendance at a meeting of members.

3.03 Termination of Membership (Default Rule)

Suggested wording for default rule:

A membership in the Corporation is terminated when:

  1. the member dies or resigns;
  2. the member is expelled or their membership is otherwise terminated in accordance with the articles or by-laws;
  3. the member's term of membership expires; or
  4. the Corporation is liquidated and dissolved under the Act.

3.04 Effect of Termination of Membership (Default Rule)

Suggested wording for default rule:

Subject to the articles, upon any termination of membership, the rights of the member, including any rights in the property of the Corporation, automatically cease to exist.

3.05 Discipline of Members

Suggested wording for standard recommended clause:

The board shall have authority to suspend or expel any member from the Corporation for any one or more of the following grounds:

  1. violating any provision of the articles, by-laws, or written policies of the Corporation;
  2. carrying out any conduct which may be detrimental to the Corporation as determined by the board in its sole discretion;
  3. for any other reason that the board in its sole and absolute discretion considers to be reasonable, having regard to the purpose of the Corporation.

In the event that the board determines that a member should be expelled or suspended from membership in the Corporation, the president, or such other officer as may be designated by the board, shall provide twenty (20) days notice of suspension or expulsion to the member and shall provide reasons for the proposed suspension or expulsion. The member may make written submissions to the president, or such other officer as may be designated by the board, in response to the notice received within such twenty (20) day period. In the event that no written submissions are received by the president, the president, or such other officer as may be designated by the board, may proceed to notify the member that the member is suspended or expelled from membership in the Corporation. If written submissions are received in accordance with this section, the board will consider such submissions in arriving at a final decision and shall notify the member concerning such final decision within a further twenty (20) days from the date of receipt of the submissions. The board's decision shall be final and binding on the member, without any further right of appeal.

Section 4 - Meetings of Members

4.01 Proposals Nominating Directors at Annual Members' Meetings (Default Rule)

Suggested wording for default rule:

Subject to the Regulations under the Act, any proposal may include nominations for the election of directors if the proposal is signed by not less than 5% of members entitled to vote at the meeting at which the proposal is to be presented.

4.02 Place of Members' Meeting (Default Rule)

Suggested wording for default rule:

Subject to compliance with section 159 (Place of Members' Meetings) of the Act, meetings of the members may be held at any place within Canada determined by the board or, if all of the members entitled to vote at such meeting so agree, outside Canada.

4.03 Persons Entitled to be Present at Members' Meetings

Suggested wording for MEMBERS ONLY:

The only persons entitled to be present at a meeting of members shall be those entitled to vote at the meeting, the directors and the public accountant of the Corporation and such other persons who are entitled or required under any provision of the Act, articles or by-laws of the Corporation to be present at the meeting. Any other person may be admitted only on the invitation of the chair of the meeting or by resolution of the members.

Suggested wording for OPEN TO PUBLIC:

Members, non-members, directors and the public accountant of the Corporation are entitled to be present at a meeting of members. However, only those members entitled to vote at the members' meeting according to the provisions of the Act, articles and by-laws are entitled to cast a vote at the meeting.

4.04 Chair of Members' Meetings

Suggested wording for standard recommended clause:

In the event that the chair of the board and the vice-chair of the board are absent, the members who are present and entitled to vote at the meeting shall choose one of their number to chair the meeting.

4.05 Quorum at Members' Meetings (Default Rule)

Suggested wording for default rule:

A quorum at any meeting of the members (unless a greater number of members are required to be present by the Act) shall be a majority of the members entitled to vote at the meeting. If a quorum is present at the opening of a meeting of members, the members present may proceed with the business of the meeting even if a quorum is not present throughout the meeting.

Suggested wording for alternate rule:

percentage:

A quorum at any meeting of the members (unless a greater number of members are required to be present by the Act) shall be _____ percent of the members entitled to vote at the meeting. If a quorum is present at the opening of a meeting of members, the members present may proceed with the business of the meeting even if a quorum is not present throughout the meeting.

4.06 Votes to Govern at Members' Meetings

Suggested wording for standard recommended clause:

At any meeting of members every question shall, unless otherwise provided by the articles or by-laws or by the Act, be determined by a majority of the votes cast on the questions. In case of an equality of votes either on a show of hands or on a ballot or on the results of electronic voting, the chair of the meeting in addition to an original vote shall have a second or casting vote.

4.07 Participation by Electronic Means at Members' Meetings (Default Rule)

Suggested wording for default rule:

If the Corporation chooses to make available a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during a meeting of members, any person entitled to attend such meeting may participate in the meeting by means of such telephonic, electronic or other communication facility in the manner provided by the Act. A person participating in a meeting by such means is deemed to be present at the meeting. Notwithstanding any other provision of this by-law, any person participating in a meeting of members pursuant to this section who is entitled to vote at that meeting may vote, in accordance with the Act, by means of any telephonic, electronic or other communication facility that the Corporation has made available for that purpose.

Suggested wording if the corporation wishes to prohibit electronic participation:

Participation at meetings of members may not be by telephonic, electronic or other communication facility

4.08 Members' Meeting Held Entirely by Electronic Means (Default Rule)

Suggested wording for default rule:

Meetings of members may not be held entirely by telephonic, an electronic or other communication facility.

Suggested wording for alterative rule:

If the directors or members of the Corporation call a meeting of members pursuant to the Act, those directors or members, as the case may be, may determine that the meeting shall be held, in accordance with the Act and the Regulations, entirely by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting.

Section 5 – Directors

5.01 Number of Directors

Suggested wording for standard recommended clause:

The board shall consist of the number of directors specified in the articles. If the articles provide for a minimum and maximum number of directors, the board shall be comprised of the fixed number of directors as determined from time to time by the members by ordinary resolution or, if the ordinary resolution empowers the directors to determine the number, by resolution of the board. In the case of a soliciting corporation the minimum number of directors may not be fewer than three (3), at least two of whom are not officers or employees of the Corporation or its affiliates.

5.02 Term of Office of Directors

Suggested wording for FIXED TERM:

The directors shall be elected to hold office for a term expiring not later than the close of the ________________ annual meeting of members following the election.

Suggested wording for ROLLING TERM:

At the first election of Directors following the approval of this by-law, one-third (1/3) directors shall be elected for a three-year term, one-third (1/3) directors shall be elected for a two-year term and one-third (1/3) directors shall be elected for a one-year term. Thereafter, except where an election is held to fill the unexpired portion of a term, newly elected directors shall be elected for three-year (3) terms.

Section 6 - Meeting of Directors

6.01 Calling of Meetings of Board of Directors

Suggested wording for NEWLY INCORPORATED CORPORATIONS

Meetings of the board may be called by the chair of the board, the vice-chair of the board or any two (2) directors at any time; provided that for the first organization meeting following incorporation, such meeting may be called by any director or incorporator. If the Corporation has only one director, that director may call and constitute a meeting.

Suggested wording for CORPORATIONS CONTINUING INTO THE NFP ACT

Meetings of the board may be called by the chair of the board, the vice-chair of the board or any two (2) directors at any time. If the Corporation has only one director, that director may call and constitute a meeting.

6.02 Notice of Meeting of Board of Directors

Suggested wording for standard recommended clause:

Notice of the time and place for the holding of a meeting of the board shall be given in the manner provided in the section on giving notice of meeting of directors of this by-law to every director of the Corporation not less than _________ days before the time when the meeting is to be held. Notice of a meeting shall not be necessary if all of the directors are present, and none objects to the holding of the meeting, or if those absent have waived notice of or have otherwise signified their consent to the holding of such meeting. Notice of an adjourned meeting is not required if the time and place of the adjourned meeting is announced at the original meeting. Unless the by-law otherwise provides, no notice of meeting need specify the purpose or the business to be transacted at the meeting except that a notice of meeting of directors shall specify any matter referred to in subsection 138(2) (Limits on Authority) of the Act that is to be dealt with at the meeting.

6.03 Regular Meetings of the Board of Directors

Suggested wording for standard recommended clause:

The board may appoint a day or days in any month or months for regular meetings of the board at a place and hour to be named. A copy of any resolution of the board fixing the place and time of such regular meetings of the board shall be sent to each director forthwith after being passed, but no other notice shall be required for any such regular meeting except if subsection 136(3) (Notice of Meeting) of the Act requires the purpose thereof or the business to be transacted to be specified in the notice.

6.04 Votes to Govern at Meetings of the Board of Directors

Suggested wording for standard recommended clause:

At all meetings of the board, every question shall be decided by a majority of the votes cast on the question. In case of an equality of votes, the chair of the meeting in addition to an original vote shall have a second or casting vote.

6.05 Committees of the Board of Directors

Suggested wording for standard recommended clause:

The board may from time to time appoint any committee or other advisory body, as it deems necessary or appropriate for such purposes and, subject to the Act, with such powers as the board shall see fit. Any such committee may formulate its own rules of procedure, subject to such regulations or directions as the board may from time to time make. Any committee member may be removed by resolution of the board of directors.

Section 7 - Officers

7.01 Appointment of Officers (Default Rule)

Suggested wording for default rule:

The board may designate the offices of the Corporation, appoint officers on an annual or more frequent basis, specify their duties and, subject to the Act, delegate to such officers the power to manage the affairs of the Corporation. A director may be appointed to any office of the Corporation. An officer may, but need not be, a director unless these by-laws otherwise provide. Two or more offices may be held by the same person.

7.02 Description of Offices

Suggested wording for standard recommended clause:

Unless otherwise specified by the board (which may, subject to the Act modify, restrict or supplement such duties and powers), the offices of the Corporation, if designated and if officers are appointed, shall have the following duties and powers associated with their positions:

  1. Chair of the Board – The chair of the board, if one is to be appointed, shall be a director. The chair of the board, if any, shall, when present, preside at all meetings of the board of directors and of the members. The chair shall have such other duties and powers as the board may specify.
  2. Vice-Chair of the Board – The vice-chair of the board, if one is to be appointed, shall be a director. If the chair of the board is absent or is unable or refuses to act, the vice-chair of the board, if any, shall, when present, preside at all meetings of the board of directors and of the members. The vice-chair shall have such other duties and powers as the board may specify.
  3. President – If appointed, the president shall be the chief executive officer of the Corporation and shall be responsible for implementing the strategic plans and policies of the Corporation. The president shall, subject to the authority of the board, have general supervision of the affairs of the Corporation.
  4. Secretary – If appointed, the secretary shall attend and be the secretary of all meetings of the board, members and committees of the board. The secretary shall enter or cause to be entered in the Corporation's minute book, minutes of all proceedings at such meetings; the secretary shall give, or cause to be given, as and when instructed, notices to members, directors, the public accountant and members of committees; the secretary shall be the custodian of all books, papers, records, documents and other instruments belonging to the Corporation.
  5. Treasurer – If appointed, the treasurer shall have such powers and duties as the board may specify.

The powers and duties of all other officers of the Corporation shall be such as the terms of their engagement call for or the board or president requires of them. The board may from time to time and subject to the Act, vary, add to or limit the powers and duties of any officer.

7.03 Vacancy in Office

Suggested wording for standard recommended clause:

In the absence of a written agreement to the contrary, the board may remove, whether for cause or without cause, any officer of the Corporation. Unless so removed, an officer shall hold office until the earlier of:

  1. the officer's successor being appointed,
  2. the officer's resignation,
  3. such officer ceasing to be a director (if a necessary qualification of appointment) or,
  4. such officer's death.

If the office of any officer of the Corporation shall be or become vacant, the directors may, by resolution, appoint a person to fill such vacancy.

Section 8 - Notices

8.01 Method of Giving Any Notice

Suggested wording for standard recommended clause:

Any notice (which term includes any communication or document), other than notice of a meeting of members or a meeting of the board of directors, to be given (which term includes sent, delivered or served) pursuant to the Act, the articles, the by-laws or otherwise to a member, director, officer or member of a committee of the board or to the public accountant shall be sufficiently given:

  1. if delivered personally to the person to whom it is to be given or if delivered to such person's address as shown in the records of the Corporation or in the case of notice to a director to the latest address as shown in the last notice that was sent by the Corporation in accordance with section 128 (Notice of directors) or 134 (Notice of change of directors);
  2. if mailed to such person at such person's recorded address by prepaid ordinary or air mail;
  3. if sent to such person by telephonic, electronic or other communication facility at such person's recorded address for that purpose; or
  4. if provided in the form of an electronic document in accordance with Part 17 of the Act.

A notice so delivered shall be deemed to have been given when it is delivered personally or to the recorded address as mentioned above; a notice so mailed shall be deemed to have been given when deposited in a post office or public letter box; and a notice so sent by any means of transmitted or recorded communication shall be deemed to have been given when dispatched or delivered to the appropriate communication company or agency or its representative for dispatch. The secretary may change or cause to be changed the recorded address of any member, director, officer, public accountant or member of a committee of the board in accordance with any information believed by the secretary to be reliable. The declaration by the secretary that notice has been given pursuant to this law shall be sufficient and conclusive evidence of the giving of such notice. The signature of any director or officer of the Corporation to any notice or other document to be given by the Corporation may be written, stamped, type-written or printed or partly written, stamped, type-written or printed.

8.02 Invalidity of any Provisions of this By-law

Suggested wording for standard recommended clause:

The invalidity or unenforceability of any provision of this by-law shall not affect the validity or enforceability of the remaining provisions of this by-law.

8.03 Omissions and Errors

Suggested wording for standard recommended clause:

The accidental omission to give any notice to any member, director, officer, member of a committee of the board or public accountant, or the non-receipt of any notice by any such person where the Corporation has provided notice in accordance with the by-laws or any error in any notice not affecting its substance shall not invalidate any action taken at any meeting to which the notice pertained or otherwise founded on such notice.

Section 9 - Dispute Resolution

9.01 Mediation and Arbitration

Suggested wording for standard recommended clause:

Disputes or controversies among members, directors, officers, committee members, or volunteers of the Corporation are as much as possible to be resolved in accordance with mediation and/or arbitration as provided in the section on dispute resolution mechanism of this by-law.

9.02 Dispute Resolution Mechanism

Suggested wording for standard recommended clause:

In the event that a dispute or controversy among members, directors, officers, committee members or volunteers of the Corporation arising out of or related to the articles or by-laws, or out of any aspect of the operations of the Corporation is not resolved in private meetings between the parties then without prejudice to or in any other way derogating from the rights of the members, directors, officers, committee members, employees or volunteers of the Corporation as set out in the articles, by-laws or the Act, and as an alternative to such person instituting a law suit or legal action, such dispute or controversy shall be settled by a process of dispute resolution as follows:

  • The dispute or controversy shall first be submitted to a panel of mediators whereby the one party appoints one mediator, the other party (or if applicable the board of the Corporation) appoints one mediator, and the two mediators so appointed jointly appoint a third mediator. The three mediators will then meet with the parties in question in an attempt to mediate a resolution between the parties.
  • The number of mediators may be reduced from three to one or two upon agreement of the parties.
  • If the parties are not successful in resolving the dispute through mediation, then the parties agree that the dispute shall be settled by arbitration before a single arbitrator, who shall not be any one of the mediators referred to above, in accordance with the provincial or territorial legislation governing domestic arbitrations in force in the province or territory where the registered office of the Corporation is situated or as otherwise agreed upon by the parties to the dispute. The parties agree that all proceedings relating to arbitration shall be kept confidential and there shall be no disclosure of any kind. The decision of the arbitrator shall be final and binding and shall not be subject to appeal on a question of fact, law or mixed fact and law.

All costs of the mediators appointed in accordance with this section shall be borne equally by the parties to the dispute or the controversy. All costs of the arbitrators appointed in accordance with this section shall be borne by such parties as may be determined by the arbitrators.

Section 10 - Effective Date

10.01 Effective Date

Subject to the articles, the board of directors may, by resolution, make, amend or repeal any by-laws that regulate the activities or affairs of the Corporation. Any such by-law, amendment or repeal shall be effective from the date of the resolution of directors until the next meeting of members where it may be confirmed, rejected or amended by the members by ordinary resolution. If the by-law, amendment or repeal is confirmed or confirmed as amended by the members it remains effective in the form in which it was confirmed. The by-law, amendment or repeal ceases to have effect if it is not submitted to the members at the next meeting of members or if it is rejected by the members at the meeting.

This section does not apply to a by-law that requires a special resolution of the members according to subsection 197(1) (fundamental change) of the Act because such by-law amendments or repeals are only effective when confirmed by members.

CERTIFIED to be By-Law No. 1 of the Corporation, as enacted by the directors of the Corporation by resolution on the _______ day of ________, 20____ and confirmed by the members of the Corporation by special resolution on the ______ day of ______, 20_____.

Dated as of the _________ day of __________, 20______.

_______________________________

[Indicate name of director/officer]

Annex A - Default Rules

Provision Default Rule Alternate Rule to Consider
(By-Law would be required)*
Financial Matters
Borrowing Powers Directors can borrow and grant security without authorization of members. Can restrict borrowing powers.
Providing annual financial statements to members Annual financial statements must be sent to members 21-60 days before the annual meeting. Can send notice to members that financial statements are available at the registered office.
Membership
Transferability of membership Membership can only be transferred back to the not-for-profit corporation. Can specify different rules for transferability.
Place of meeting of members The meeting of members is to be held at a place in Canada that the directors determine or a place outside Canada if all members entitled to vote at the meeting agree. Can provide otherwise.
Members call a meeting Members who hold 5% of the vote can request a meeting of members. Can set a percentage lower than 5% but not higher.
Electronic participation at meetings Participation by electronic means is permitted. Electronic participation can be prohibited or restricted.
Meeting held entirely by electronic means Not permitted Can be permitted as long as all participants can communicate adequately with each other.
Electronic participation at meetings Participation by electronic means is permitted. Electronic participation can be prohibited or restricted.
Quorum for meetings Quorum is a majority of members, and if quorum is present at the opening of a meeting, business may proceed even if quorum is not present throughout the meeting. By-laws with a different quorum must set it out as a fixed number of members, a percentage of members or a number or percentage of members that is determinable by a formula. Can provide that an opening quorum at a meeting is not sufficient where there is a loss of quorum later in the meeting.
Manner of voting by members Voting is by a show of hands or by electronic participation. A member entitled to vote at the meeting can demand a ballot. Can specify manner of voting.
Absentee voting by members Not permitted except for electronic participation. Can specify absentee voting will be allowed by proxy, mailed in ballot, or by telephone, electronic or other communication facility. Must set out procedures for collecting, counting and reporting the results of any vote.
Rights on termination of membership Rights of a member cease to exist on termination of membership. Can provide otherwise.
Directors
Remuneration of directors Directors can fix the reasonable remuneration of directors, officers and employees. Can provide otherwise.
Place of meeting of directors Directors may meet at any place. Can provide otherwise.
Appointment of directors No appointments allowed. Cannot be overridden by the by-laws.
Important note: The general rule is that directors are elected by a majority of the votes cast at a general meeting. This means that ex offcio directors are NOT allowed, that is, persons who are appointed to the board by virtue of the office they hold.
Quorum of directors A majority of the number of directors or minimum number of directors required by the articles constitutes a quorum. Can provide otherwise.
Borrowing powers Directors may borrow money and grant security on property of the corporation without member authorization. Can restrict the power in the by-laws or articles.
Appointment of officers Directors designate the offices, appoint officers and specify their duties. Can provide otherwise.
By-laws Directors make, amend or repeal by-laws except those requiring two-third vote of members. The by-law, amendment or repeal is effective until the next meeting confirm, amend or reject it. Can provide otherwise, i.e. required to present changes to members.
Other
Electronic documents Electronic documents are permitted. Can provide otherwise.

*For examples of wording for these alternatives, please consult the basic model by-law template which can be found under “Step 3” of the Industry Canada Transition Guide.

Disclaimer: Any information provided by Small Craft Harbours, Fisheries and Oceans Canada, including this by-law, is not intended to be a substitute for legal advice. Not-for-profit corporations are encouraged to seek professional advice.

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