The New Morality in Quebec Company Law - Directors' Liability after the Civil Code of Quebec

Abstract

Legal personality, it is trite to say, is a fundamental characteristic of the corporate form, and one which underpins that other fundamental but more controversial characteristic, limited liability. The concept of the separate legal personality of that “artificial being, invisible, intangible, and existing only in the contemplation of law” gives rise however to other, persistent, conceptual difficulties associated with the relationship of the various actors in the corporate undertaking. Resolving these conceptual difficulties proves more challenging in jurisdictions which, for one reason or another, draw on different legal traditions as their sources of domestic law. Civil codes, for example, have long recognized a generalized concept of legal personality (in French, “les personnes morales”) extending beyond the business corporation and which predates the emergence of English-style companies law. This article examines how one jurisdiction, Quebec, has attempted to resolve the difficulties arising from the interaction of civil code principles and modern business law, in particular with respect to directors’ liability.