Business Corporations – Appointment of Directors – Oppression Proceeding
Stephen Antle for bcMetals Corporation

This application for appointment of directors of American Bullion Metals (“ABM”) was one in a series of disputes between ABM's majority shareholder, bcMetals, and the minority shareholders, represented by the Petitioners. The Petitioners sought to appoint nominee directors to consider an offer made by a third party to acquire the minority stake in ABM. bcMetals made a cross-application for an order for a shareholders meeting so that directors could be elected in accordance with the B.C. Business Corporations Act (the “BCBCA”). bcMetals also sought to vacate a prior injunction enjoining ABM and bcMetals from appointing any further directors to the board of ABM without order of the court. The petition proceedings generally alleged oppressive and prejudicial conduct on the part of ABM and bcMetals against the minority and sought to annul the bankruptcy of ABM that had previously been declared in bankruptcy proceedings commenced by bcMetals. The court had already annulled the bankruptcy on a prior application.

The court was concerned that its decision on the directorship issue not predetermine the merits of the allegations of oppressive or prejudicial conduct, which had yet to be resolved. However, it noted that there had been some interest expressed by third parties to acquire an interest in ABM and a board needed to be in place in order to assess those expressions of interest. It exercised its discretion under s. 227 of the BCBCA to order a just and equitable interim solution allowing the majority to appoint two nominees to the board and the minority to appoint one, each of whom were to sit as directors at large rather than for a particular purpose. It also vacated the prior injunction.