Changing Directors or Officers of a BC Company: Resolutions, Consents and Filing Deadlines

Bringing in a new director, stepping down yourself, or removing someone who is no longer involved is routine for a private company, but the steps are set by statute and by your articles. Miss one and the company's records may not match the corporate register.

This article walks through the BC Business Corporations Act rules for changing directors and officers: who can make the change, the consent a new director must give, how resignations and removals work, and the 15-day filing deadline.

Directors and officers are different roles

Directors manage the company as a board. Officers, such as a president or secretary, are appointed by the directors to carry out particular duties. In many small companies the same person holds both roles, but the steps to change them are different.

Every BC company must have at least one director, and a public company must have at least three. A company does not need any particular number of officers unless its articles say so.

Adding a new director

Under section 122 of the Business Corporations Act, directors are elected or appointed in accordance with the Act and the company's memorandum and articles. In most private companies the shareholders elect directors, but check your articles, because they set the method.

If the articles allow it, the directors can also appoint additional directors between elections. Section 122 caps this: additional directors appointed by the board generally cannot exceed one-third of the current directors who were elected or appointed in the usual way.

The new director's consent

An election or appointment is not valid unless the individual consents. Section 123 allows consent in writing given to the company before or after the appointment, or by acting as a director after knowing of the appointment. A short signed consent is the clearest evidence and belongs in the minute book.

Who can serve

Section 124 sets out who is not qualified. An individual cannot become or act as a director if they are under 18, have been found by a court to be incapable of managing their own affairs, are an undischarged bankrupt, or have certain convictions for fraud or offences connected with managing a business, subject to exceptions in the Act. A director who stops being qualified must promptly resign. Only individuals can be directors, not corporations.

When a director leaves

Section 128 lists the ways a director ceases to hold office: their term expires, they die, they resign, or they are removed.

• Resignation. A resignation takes effect when the written resignation is given to the company or its lawyer, or at a later date, time or event stated in it.
• Removal. Unless the articles provide a different method, shareholders can remove a director before their term ends by special resolution. For most companies, a special resolution requires at least two-thirds of the votes cast at a general meeting (the articles can set a higher threshold, up to three-quarters), or the written consent of all voting shareholders.

If removing a director would leave the board without enough members to act, plan the replacement at the same time. Section 131 allows a vacancy created by removal to be filled by the shareholders at the meeting where the director is removed, or afterwards by the shareholders or the remaining directors. Our article on what happens when a sole director dies or loses capacity explains the problems a company faces with no director in office.

Filing the notice of change of directors

Section 127 requires a company to file a notice of change of directors with the Registrar within 15 days after any change in its directors, or in the prescribed address of any director. Filing the notice also updates the company's notice of articles.

BC companies file this through BC Registries and Online Services, using the company's business registry dashboard. A change is filed using the date it actually happened, not the date it is submitted, so late filings still need the correct date. If a person is left on the register after leaving, section 127.1 gives them a way to apply to have their name removed, which is better avoided by filing on time.

Changing officers

Under section 141, unless the memorandum or articles provide otherwise, the directors appoint officers, set their duties and can remove them. One individual can hold more than one office, and a person who is not qualified to be a director cannot be an officer either.

An officer change is made by a directors' resolution. Section 140 allows directors to pass a resolution without a meeting if every director entitled to vote consents to it in writing, which is how most small companies handle these changes. Removing an officer does not cancel any rights they have under an employment or other contract, so check those terms before acting.

Keep the minute book in step

Section 126 requires a company to keep a register of directors showing each director's name and prescribed address, the date they became a director, the date any former director ceased to be one, and any office a director holds. Each change should leave a paper trail:

• the shareholders' or directors' resolution making the change;
• the new director's written consent;
• any written resignation;
• an updated register of directors;
• a copy of the filed notice of change of directors.

Our article on what must be in a BC company minute book covers the full list. New directors should also understand the duties and exposure that come with the role; see director personal liability in BC.

Changing your board? Have the paperwork done properly

Our business lawyers can review your articles, prepare the resolutions, consents and resignations, file the notice of change of directors and update your minute book.

Call 604-259-2844 or send us a message to arrange a consultation at our Vancouver office.