Earlier this month, in Canada v Chriss, 2016 FCA 236, the Federal Court of Appeal overturned the trial judge's finding that two individuals had resigned as directors. The directors' intention to resign was not enough and there had been no "written resignation received by the corporation" within the meaning of section 121(2) of the Business Corporations Act, RSO 1990, c B.16. Rennie JA observed (at paras. 19, 23 and 24):A director’s belief that they have resigned has no correspondence or connection to the underlying purposes of subsection 121(2) ... and its emphasis on an objectively verifiable communication of a resignation to the corporation. To allow a subjective intention to suddenly spring to life, when, in the affairs of the corporation, or in the interests of the director, it is convenient to do so, would significantly undermine corporate governance. A reasonable belief that one has resigned must hew much closer to the requirements for an actual effective resignation. ... The requirement that the resignations be received by the corporation cannot be ignored ... The test applied by the judge in this case also set far too low a standard. He applied a test whereby a director who requests (orally) the executives of the corporation to arrange for counsel to prepare and draft a resignation can, by virtue of that act alone, reasonably believe that they have resigned. On this standard, a director need not ever sign a document or receive an indication to the effect that his or her resignation was delivered to the company. Directors must carry out their duties on an active basis. A director cannot raise a due diligence defence by relying on their own indifferent or casual attitude to their responsibilities. A reasonable director would insist on being satisfied that their intention to resign had been effected".
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