Directors

5  (1)  There must be appointed to the board of directors of the corporation 18 individuals resident in the region of whom

(a) 2 must be appointed by the board of the Regional District of Central Kootenay,

(b) 2 must be appointed by the board of the Fraser-Fort George Regional District,

(c) 2 must be appointed by the board of the Columbia Shuswap Regional District,

(d) 2 must be appointed by the board of the Kootenay Boundary Regional District,

(e) 2 must be appointed by the board of the East Kootenay Regional District,

(f) 2 must be appointed by the tribal council, and

(g) 6 must be appointed by the Lieutenant Governor in Council.

(2)  Subject to subsection (3), the term of office of a director is 2 years, beginning on April 1 and ending on the second March 31 to follow the beginning of the director's term, and a director may be appointed for successive terms.

(3)  One of the first 2 directors appointed under each of paragraphs (a) to (f) of subsection (1) and 3 of the first 6 directors appointed under subsection (1) (g) must be appointed for a term ending on the first March 31 to follow their appointments and the remainder of the first directors must be appointed for a term ending on the second March 31 to follow their appointments.

(4)  An act or proceeding of the directors is not invalid merely because less than the number of directors required by subsection (1) is in office.

 Appointment of directors

6  (1)  For the purposes of this section and section 5 (1) (a) to (e), an individual is appointed as a director by the board of a regional district if there is provided to the minister by the regional district corporate officer

(a) a statement confirming the director's appointment, signed by that regional district officer, and

(b) a consent to act as a director for the corporation, signed and dated by the appointee within 90 days before the date on which the consent is provided to the minister.

(2)  For the purposes of this section and section 5 (1) (f), an individual is appointed as a director by the tribal council if there is provided to the minister by the secretary of the tribal council

(a) a statement confirming the director's appointment, signed by at least 3 of the chiefs of the member bands of the tribal council, and

(b) a consent to act as a director for the corporation, signed and dated by the appointee within 90 days before the date on which the consent is provided to the minister.

(3)  A regional district board or the tribal council may adopt any process that it considers appropriate, including any process for elections, for the purpose of choosing appointees for directors under subsection (1) or (2), as the case may be.

(4)  At least 21 days before the expiry of the term of a sitting director appointed by a regional district board or the tribal council, the regional district board or tribal council that appointed that sitting director must appoint a replacement director to take office on the expiry of the sitting director's term.

(5)  If the regional district board or tribal council referred to in subsection (4) does not appoint a replacement director at least 21 days before the expiry of the term of the sitting director, the Lieutenant Governor in Council may appoint any individual the Lieutenant Governor in Council considers appropriate to fill the required position effective on the expiry of the sitting director's term and that appointee is deemed, for the purposes of this section and sections 7 and 8, to be a director appointed by the regional district board or tribal council.

 Removal of directors

7  (1)  The board of a regional district may replace a director appointed by that board by providing to the minister

(a) a statement revoking the director's appointment, signed by the regional district corporate officer, and

(b) the records required under section 6 (1) for the appointment of the replacement director by that board.

(2)  The tribal council may replace a director appointed by the tribal council by providing to the minister

(a) a statement revoking the director's appointment, signed by at least 3 of the chiefs of the member bands of the tribal council, and

(b) the records required under section 6 (2) for the appointment of the replacement director by the tribal council.

(3)  The term of office of a replacement director appointed under this section is the unexpired portion of the term of office of the director being replaced.

 Replacement of directors

8  (1)  If a director appointed by a regional district board or the tribal council ceases, for any reason, to be a director before the end of the term for which that individual was appointed,

(a) the corporation must provide notice of the vacancy to the minister and the regional district board or the tribal council that appointed that director, and

(b) subject to section 24 (3), the regional district board or tribal council must promptly appoint a replacement director for the unexpired portion of the term by providing to the minister the records required under section 6 for the appointment of a director by that regional district board or the tribal council.

(2)  If a regional district board or the tribal council referred to in subsection (1) does not make the required appointment within 60 days after receiving a notice under subsection (1) (a) or, in the case of an office declared vacant under section 24, within 60 days after the date on which an appointment may, under section 24 (3), be made to fill the office, the Lieutenant Governor in Council may appoint any individual the Lieutenant Governor in Council considers appropriate to fill the required position.

(3)  A director appointed by the Lieutenant Governor in Council under subsection (2) is deemed, for the purposes of sections 6 (4) and (5) and 7 and this section, to be a director appointed by the regional district board or the tribal council referred to in subsection (1).

 Directors' remuneration

11  The corporation may pay to a director

(a) an allowance for reasonable travelling and incidental expenses necessarily incurred in attending the meetings of the corporation, and

(b) if the director is not a member of the Legislative Assembly or a public servant and is not receiving remuneration from any other source for acting as a director of the corporation, remuneration at a rate that does not exceed a rate determined by the minister after considering the rates paid to directors in government corporations of a similar size or with similar duties or functions.

 Advisory committees

13  (1)  The directors must establish one or more advisory committees, each of which is to consist of not less than 7 individuals appointed in accordance with this section, to

(a) provide advice and make recommendations to the directors about the application of the regional allocation,

(b) anticipate and identify regional economic, environmental and social needs, and

(c) assist the directors to develop short and long term plans for the operations of the corporation.

(2)  Each advisory committee is to consist of individuals appointed to reflect the diverse interests and needs of the region.

(3)  An individual who is an employee, officer or director of the corporation must not be appointed to an advisory committee established under subsection (1).

(4)  The corporation may pay the members of an advisory committee a reasonable allowance for travelling and incidental expenses necessarily incurred in carrying out the business of the committee.

 Definitions

16  In this Part:

"child" includes, in relation to a director, an individual whom the director has demonstrated a settled intention to treat as a member of the director's family;

"controlling interest" means

(a) an interest, other than an interest by way of security only, that a director must disclose under section 5 (1) of the Financial Disclosure Act, or

(b) an interest, other than an interest by way of security only, in shares of a corporation carrying in the aggregate more than 10% of the votes for the election of the directors of that corporation;

"court" means the Supreme Court;

"meeting" means a meeting of the directors or of a committee of directors;

"pecuniary interest" means, with respect to a director, an interest in a matter that could monetarily affect the director and includes an indirect pecuniary interest referred to in section 17;

"senior officer" has the same meaning as in the Company Act;

"spouse" means, in relation to a director, an individual who is married to the director or an individual who is living with the director as husband and wife and has lived in that capacity for a continuous period of at least 2 years but does not include a husband or a wife who is separated and living apart from the director and who

(a) has entered into a written agreement under which the individual and the director have agreed to live apart, or

(b) is subject to a court order recognizing the separation.

 Indirect pecuniary interest

17  For the purposes of this Part, a director has an indirect pecuniary interest in any matter in which the corporation is concerned if

(a) the director or the director's nominee

(i)  is a shareholder in or a director or senior officer of a corporation that does not offer its securities to the public and that corporation has a pecuniary interest in the matter, or

(ii)  has a controlling interest in or is a director or senior officer of a corporation that offers its securities to the public and that corporation has a pecuniary interest in the matter, or

(b) the director is a partner of a person, is a member of a firm or is in the employment of a person or firm that has a pecuniary interest in the matter.

 Deemed pecuniary interest

18  For the purposes of this Part, the pecuniary interest of a spouse, parent or child of the director is, if that pecuniary interest is known to the director, also the pecuniary interest of the director.

 Duty of directors to disclose

19  (1)  If a director has any pecuniary interest in any matter and is present at a meeting at which the matter is considered, the director

(a) must disclose at the meeting the director's pecuniary interest and the general nature of the pecuniary interest,

(b) must not take part in the discussion of or vote on any question in respect of the matter, and

(c) must not attempt in any way, whether before, during or after the meeting, to influence the voting on any question in respect of the matter.

(2)  If the meeting referred to in subsection (1) is not open to the public, the director must, in addition to complying with the requirements of that subsection, immediately leave the meeting at any time during which the matter is under consideration.

(3)  If, because of a director's absence from a meeting at which a matter is considered, the pecuniary interest of the director in the matter is not disclosed as required by subsection (1), the director must disclose the pecuniary interest and otherwise comply with the requirements of subsections (1) and (2) at the first meeting of the board of directors attended by the director after the meeting referred to in subsection (1).

 Exceptions

20  Section 19 does not apply to a pecuniary interest that a director has in any matter if

(a) the pecuniary interest is one that the director has in common with the residents of the region generally,

(b) the director has the pecuniary interest because the director is entitled to receive an indemnity, expenses or remuneration payable to one or more directors of the corporation in respect of the matter,

(c) the director has the pecuniary interest merely because the director is a member of an association incorporated or continued under the Cooperative Association Act or of a credit union as defined in the Credit Union Incorporation Act and the association or credit union has dealings or contracts in respect of the matter with the corporation, or

(d) the pecuniary interest of the director is so remote or insignificant in its nature that it cannot reasonably be regarded as likely to influence the director.

 Record of disclosure in minutes

21  (1)  If a meeting is open to the public, every disclosure at that meeting of a pecuniary interest and the general nature of it made under section 19 must be recorded in the minutes of the meeting.

(2)  If a meeting is not open to the public, the fact that a disclosure of a pecuniary interest was made under section 19, but not the general nature of that interest, must be recorded in the minutes of the next meeting that is open to the public.

 Remedy for lack of quorum

22  (1)  When the number of directors who, because of this Part, are disqualified from participating in a meeting is such that at that meeting the remaining directors are not of sufficient number to constitute a quorum, the corporation may apply to the court, without notice to any person, for an order authorizing the remaining directors to consider, discuss and vote on the matter out of which the pecuniary interest arises.

(2)  The court, on application under subsection (1) and after giving any direction as to service that the court considers appropriate, may declare that section 19 does not apply to the board of directors in respect of the matter in relation to which the application was brought, and the board of directors may then consider, discuss and vote on the matter in the same manner as though none of the directors had any pecuniary interest in the matter, subject only to any conditions and directions that the judge considers appropriate and orders.

 Application to court

23  (1)  Subject to subsection (3), a resident of the region may, within 6 weeks after the resident becomes aware that a director may have contravened section 19, apply to the court in the manner prescribed by the Rules of Court for a determination of the question of whether the director has contravened section 19.

(2)  The applicant must state the grounds for alleging a contravention of section 19 by the director.

(3)  An application must not be brought under subsection (1) after the expiration of 4 years from the time at which the contravention is alleged to have occurred.

 Remedy

24  (1)  If the court determines that an individual, while holding the office of director, has knowingly contravened section 19, the court

(a) must, subject to subsection (2), in the case of an individual currently holding office as a director, declare the office of the director vacant, and

(b) may, if the contravention has resulted in financial gain, require the individual to make restitution to the party suffering the loss or, if that party is not readily ascertainable, to the corporation.

(2)  If the court determines that an individual who is currently holding the office of director contravened section 19 and finds that the contravention was committed through inadvertence or because of a good faith error in judgment, the court need not declare that individual's office vacant under subsection (1).

(3)  An office declared vacant under subsection (1) must remain vacant if the decision to declare the office vacant is appealed and no appointment to fill the office may be made until the final determination of the matter or until the end of the director's term of office, whichever is earlier.

 Proceedings voidable

25  The failure of an individual to comply with section 19 does not of itself invalidate any proceedings of the board of directors, but the proceedings are voidable at the instance of the board within 2 years after the date of the passing of the resolution in respect of which the failure occurred, unless invalidation of the proceedings would adversely affect the rights of another person who

(a) acquired those rights under or by virtue of the proceedings, and

(b) acted in good faith and without actual notice of the failure to comply with section 19.

26  (1)  The corporation must establish and maintain an accounting system satisfactory to the Minister of Finance and Corporate Relations.

27  (1)  The corporation must appoint an auditor to audit the accounts and transactions of the corporation.

 Annual report

28  (1)  The corporation must prepare and deliver to the minister, promptly after the end of each fiscal year of the corporation,

(a) a report of the corporation on its operations for the most recently completed fiscal year, and

(b) an audited financial statement showing, in the form required by the Minister of Finance and Corporate Relations, the assets and liabilities and revenues and expenditures of the corporation at the end of the most recently completed fiscal year.

(2)  The financial statement referred to in subsection (1) (b) must be prepared in accordance with generally accepted accounting principles.

(3)  The report and financial statement referred to in subsection (1) must be laid before the Legislative Assembly as soon as practicable.