The general rule is that a director (of a profit or a non-profit)
must act strictly within his or her actual authority and must
be reasonable in making their decisions. If the directors act
beyond that authority, they can lose their legal protection of
personal liability. And, as mentioned, the range of liabilities
is determined by contract, statute, and tort. For example, failing
to see to it that the proper deductions are sent to Revenue Canada
can result in the directors being personally liable for the amounts
not sent. Contracting with a company in which a director has
a personal interest without disclosure might result in that director
being responsible to the company for the profit in the contract.
Deciding not to clear ice and snow from a sidewalk where it is
obvious that damage will result could lead to personal liability
for the directors.
