LSO Barrister Business Law & Contracts 1

Question 1

Under the Ontario Business Corporations Act (OBCA), what is the minimum number of directors required for a private company?

Accepted Answer

One

Answer

Section 115 of the OBCA requires a corporation to have at least one director, though most private corporations have one or more for governance purposes.

Question 2

Under Canadian contract law, what are the essential elements for a valid and enforceable contract?

Accepted Answer

Offer, acceptance, consideration, and intention to create legal relations

Answer

A binding contract requires offer, acceptance, consideration (mutual exchange of value), capacity, and intention to create legal relations.

Question 3

What is the legal concept of 'privity of contract' in Ontario?

Accepted Answer

Only parties to a contract can sue or be sued under it

Answer

Privity of contract is the common law rule that only the parties to a contract have rights and obligations under it; third parties generally cannot enforce contract terms.

Question 4

Under the Ontario Partnerships Act, what is the liability of a general partner for the debts of the partnership?

Accepted Answer

Joint and several liability for all partnership debts and obligations

Answer

General partners have unlimited joint and several liability for the debts and obligations of the partnership, meaning personal assets can be seized to satisfy partnership debts.

Question 5

Under the OBCA, what is a 'unanimous shareholder agreement' (USA)?

Accepted Answer

An agreement among all shareholders that restricts or transfers directors' powers to shareholders

Answer

A USA under section 108 of the OBCA allows shareholders to restrict or assume directors' powers, giving shareholders direct control over management decisions.

Ontario Bar Barrister Practice Test

Ontario Bar Barrister Practice Test

LSO Barrister Business Law & Contracts 1