Part 4 — Directors and Officers of Cooperatives Division 1 Number, Qualifications and Functions of Directors
78 Division 6 Liability of Directors General liability
authorizing the issue of a share in exchange for a thing or service
other than money are jointly and individually liable to the
cooperative for any amount by which the consideration received is
less in value than the money that the cooperative would have
received if the share had been issued for money on the date of the
resolution.
(2) A director is not liable under subsection (1) if the director
proves that the director did not know and could not reasonably
have known that the share was issued for consideration less in
value than the money that the cooperative would have received if
the share had been issued for money on the date of the resolution.
(3) All directors who vote for or consent to a resolution
authorizing any of the following matters are jointly and
individually liable to the cooperative for any amounts so distributed
or paid and not otherwise recovered by the cooperative:
(a) a redemption of s hares or other acquisition of investment
shares or the repayment of member loans contrary to this
Act;
(b) a commission contrary to this Act;
(c) a payment of a dividend, a patronage return or interest
contrary to this Act;
(d) financial assistance contrary to this Act;
(e) a payment of an indemn ity contrary to this Act;
(f) any other payment contrary to this Act.
(4) A director is not liable under subsection (3) if the director
proves that the director did not know and could not reasonably
have known that the amounts so distributed or paid were paid
contrary to this Act.
(5) A director who satisfies a judgment for a debt owed under this
section is entitled to contribution from the other directors who were
liable for the debt.
(6) A director who is liable under subsection (3) may apply to the
Court for an order to recover any money or property referred to in
subsection (3).
(7) The Court may, if it is satisfied that it is equitable to do so,
(a) order any person to pay or deliver to the director any money
or property referred to in subsection (3) that was paid or
distributed to that person;
(b) order a cooperative to retur n or issue shares to a person from
whom the cooperative redeemed or otherwise acquired
shares;
(c) order any person to repay t o the cooperative the amount of a
member loan that was repaid;
(d) make any further order that it thinks fit.
(8) An action to enforce a liability imposed by this section may not
be commenced more than 2 years after the date of the resolution
authorizing the action complained of.