PART XVII.1 RELATED PARTY TRANSACTIONS
Contravention
437.22 (1) If an insurer enters into a transaction contrary to this Part or the regulations, the insurer shall notify the Chief Executive Officer as soon as the insurer becomes aware of the contravention.  2006, c. 33, Sched. O, s. 16; 2018, c. 8, Sched. 13, s. 22. Order to void contract or grant other relief (2) If an insurer enters into a transaction contrary to this Part or the regulations, the insurer or the Chief Executive Officer may apply to the Superior Court of Justice for an order setting aside the transaction or for any other appropriate remedy, including an order directing that the related party of the insurer involved in the transaction account to the insurer for any profit or gain realized or that any director or senior officer of the insurer who authorized the transaction compensate the insurer for any loss or damage incurred by the insurer.  2006, c. 33, Sched. O, s. 16; 2018, c. 8, Sched. 13, s. 22. Same (3) An order may be made under subsection (2) despite anything in subsections 71 (4) and (5) of the Corporations Act.  2006, c. 33, Sched. O, s. 16. Time limit (4) An application under subsection (2) in respect of a particular transaction may only be made within the period of three months following the day the notice referred to in subsection (1) in respect of the transaction is given to the Chief Executive Officer or, if no notice is given, the day the Chief Executive Officer becomes aware of the transaction.  2006, c. 33, Sched. O, s. 16; 2018, c. 8, Sched. 13, s. 22. Directors’ liability, related party transactions (5) The directors of an insurer who vote for or consent to a resolution of the directors authorizing any transaction contrary to this Part are jointly and severally liable to restore to the insurer any amounts distributed or paid in connection with the transaction that are not otherwise recovered by the insurer and any amounts in relation to any loss suffered by the insurer in connection with the transaction.  2006, c. 33, Sched. O, s. 16. Contribution (6) A director who has satisfied a judgment in relation to the liability of two or more directors under subsection (5) is entitled to contribution from the other directors who voted for or consented to the transaction on which the judgment was found.  2006, c. 33, Sched. O, s. 16. Recovery (7) A director who is liable under subsection (5) is entitled to apply to the Superior Court of Justice for an order compelling a shareholder or other person to pay to the director an amount equal to the value of the loss suffered by the insurer in connection with the transaction.  2006, c. 33, Sched. O, s. 16. Court order (8) Where an application is made to the court under subsection (7), the court, where it is satisfied that it is equitable to do so, (a)  may order a shareholder or other person to pay to the director an amount in respect of the loss referred to in subsection (7); and (b)  may make such other order as it thinks fit.  2006, c. 33, Sched. O, s. 16. Due diligence (9) A director, officer or employee of an insurer
is not liable under this section if the director, officer or employee exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances, including reliance in good faith on, (a)  financial statements of the insurer that were represented to them by an officer of the insurer or in a written report of an auditor of the insurer fairly to reflect the financial condition of the insurer; or (b)  a report of a person whose profession lends credibility to a statement made by the person.  2006, c. 33, Sched. O, s. 16. Note: On a day to be named by proclamation of the Lieutenant Governor, section 437.22 of the Act is amended by striking out “regulations” wherever it appears and substituting in each case “Authority rules”. (See: 2018, c. 8, Sched. 13, s. 19) Section Amendments with date in force (d/m/y) 2006, c. 33, Sched. O, s. 16 - 05/05/2008 2018, c. 8, Sched. 13, s. 19 - not in force; 2018, c. 8, Sched. 13, s. 22 - 08/06/2019 part xviii   unfair or deceptive acts or practices