Under the Ontario Business Corporations Act (OBCA), private (non-offering) corporations can bypass formal meetings by passing ordinary written resolutions with simple majority shareholder approval. This method saves time, though a corporate lawyer may charge $300 to $800 CAD to draft the formal document correctly.
Holding an annual or special meeting of shareholders can be a time-consuming administrative burden, especially for small businesses, holding companies, and family-owned enterprises. Ontario corporate law provides a highly practical alternative. Instead of renting a boardroom, sending formal advance notices, and meticulously recording minutes, you can manage corporate decisions entirely on paper.
Whether your business operates in Toronto, London, or Hamilton, executing a shareholders’ resolution in writing without a meeting in Ontario is standard practice. 📝 For private (non-offering) corporations under the OBCA, ordinary written resolutions can be passed by a simple majority of voting shares rather than requiring unanimity, while special resolutions or specific corporate bylaws still require unanimous consent. This flexibility allows your corporation to remain fully compliant without ever disrupting your daily business operations.
Step-by-Step Process in Ontario
Using a written resolution is a streamlined way to approve annual financial statements, elect directors, or appoint the company auditors. Here is how your corporation can legally skip the formal meeting process while staying on side with the law.
Step 1: Review the Corporate Minute Book
Before drafting any paperwork, you must consult your corporation’s Articles of Incorporation, bylaws, and any existing Unanimous Shareholder Agreement (USA). 📖 You need to confirm exactly who holds the voting shares and what approval thresholds are required. While the OBCA allows private corporations to pass ordinary written resolutions by a simple majority, your articles or a USA may still mandate a higher threshold or full unanimity for specific corporate actions.
Step 2: Draft the Written Resolution
The resolution must clearly and accurately state the decisions being made. Whether it is an annual resolution acknowledging the financial statements or a special resolution changing the corporation’s registered name, the language must be legally precise. Generally, a law firm drafts this document to ensure it meets all OBCA requirements.
Step 3: Circulate to All Voting Shareholders
The document must then be sent to every shareholder entitled to vote on the specific matter. 📧 In Ontario, it is perfectly acceptable to circulate the resolution digitally via email. There is no requirement for shareholders to be in the same room, making this ideal for companies with investors scattered across Canada.
Step 4: Secure Signatures and Provide Notice
For an ordinary written resolution to be legally binding without a meeting in a private Ontario corporation, it must be signed by holders of at least a simple majority of the voting shares (unless your articles require a higher threshold). If the resolution is passed by a majority rather than 100% unanimity, the corporation must send a formal written notice with the text of the resolution and reasons for the business to all non-signing shareholders within 10 business days of its passing. Under the Electronic Commerce Act of Ontario, digital signatures are fully valid and legally binding.
Step 5: File in the Corporate Minute Book
Once all signatures are fully collected, the executed document must be placed directly into the company’s official Minute Book. 🗂️ This book is the official legal record of your corporation. If the CRA or a potential buyer ever audits your business, they will inspect the Minute Book to verify that all corporate decisions were made legally.
How Much Does it Cost in Ontario?
Bypassing a formal meeting saves significantly on logistical expenses, but drafting the legal paperwork still carries a modest professional cost. 💵 Here is a general breakdown of typical costs associated with corporate resolutions in CAD.
| Government Filing Fee | $0 (Kept internally) |
| Lawyer Fees (Standard Annual Resolution) | $300 – $600 |
| Lawyer Fees (Complex Special Resolution) | $800 – $1,500+ |
| Minute Book Updating Service | $150 – $250 annually |
How Long Does the Process Take?
The beauty of a written resolution is its speed and efficiency. The entire process typically takes 2 to 5 days. ⏳ A law firm can usually draft the document within 24 hours. The only delay depends on how quickly your shareholders review the email and apply their digital signatures.
Frequently Asked Questions (FAQ)
What happens if one shareholder refuses to sign?
For private corporations in Ontario, an ordinary written resolution only requires a simple majority of voting shares. If one shareholder refuses to sign, the resolution is still valid as long as you have signatures representing more than 50% of the voting shares. However, you must notify all non-signing shareholders within 10 business days. If you are passing a special written resolution, or if your corporate bylaws require unanimity, then every single voting shareholder must sign.
Does this rule apply to director meetings too?
Yes, directors can pass written resolutions instead of holding a meeting. However, unlike shareholders’ ordinary resolutions, a written directors’ resolution under the OBCA still strictly requires the signatures of all current directors to be valid.
Do we need to send the signed resolution to the government?
No. Corporate resolutions are internal governance documents. They simply need to be stored securely in your company’s Minute Book.
Can we use written resolutions for everything?
Almost everything. However, if a director or an auditor is resigning or being removed and wishes to submit a formal statement of reasons, holding a meeting might be strictly required by law.
Are digital signatures acceptable in Ontario?
Yes, electronic signatures are widely accepted for most standard corporate resolutions, making it very easy to manage investors who live outside the province.
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