Areas of Practice

Corporate Law

Corporations are created and governed in the Province of Alberta by the Business Corporations Act of Alberta. A corporation is a seperate legal entity, distinct from its shareholders, and has the rights, powers and privileges of a natural person.

A corporation owns the assets of the business carried on by it and is entitled to the profits generated by the business. The corporation is responsible for any debts owed by the corporation, not the shareholders of the corporation. Shareholders obtain their shares from the corporation, which allows the shareholders the right to be involved in the way the corporation is run and to share in the profits. The shareholders elect the Directors to run the day-to-day operations of the corporation. The Directors appoint officers to assist them in these duties.

The corporation has perpetual succession and survives the death of its shareholders and directors until is dissolved. The corporation is capable of owning property. The assets of the corporation belong to the corporation and not its shareholders. The creditors of the corporation can sue and be sued in its own name. The corporation can borrow money, and any funds borrowed belong to the corporation and not to it shareholders.

The advantages of incorporation are:

  1. Limited liability - except for limited circumstances, shareholders are not liable for any debts, obligations or liabilities incurred in the carrying on of business by the corporation;
  2. Tax advantages - generally a corporation pays much lower taxes than an individual would pay on the same income;
  3. Perpetual Existence;
  4. Attraction of Investment Capital.