In Cheng v. Glencore plc, 2025 YKCA 8, the Yukon Court of Appeal (the Court) held that a claim for oppression can only be brought against a corporation that is currently incorporated under the territory’s Business Corporations Act, R.S.Y. 2002, c. 20 (the BCA).
The Court upheld a decision of the Supreme Court of Yukon1 (the Supreme Court), which held that it did not have subject matter jurisdiction for an oppression claim over a corporation that was discontinued under BCA and continued in another jurisdiction.2 The Court dismissed the appeal and held that section 243 of the BCA applies only to corporations as defined in the BCA, and that definition does not include a corporation that has been discontinued under the BCA. Accordingly, the Court lacked subject matter jurisdiction over the appellant’s oppression claim.3
Background
The appellant, Libei Cheng, representing the minority shareholders of a company known as Katanga Mining Limited (Katanga), brought an action against the respondents, alleging oppression by Katanga under s. 243 of the BCA.4
In June 2020, Katanga was taken private and amalgamated with a numbered Yukon corporation to form a company also called Katanga Mining Limited (New Katanga).5 Six months later, New Katanga was discontinued out of Yukon under the BCA and continued in the Isle of Man, where it is presently incorporated.6
The appellant alleged that a rights offering transaction, before the amalgamation, did not comply with the procedures required by Multilateral Instrument 61-101 and s. 195 of the BCA. The appellant argued that the arrangement allowed the respondents to acquire Katanga’s shares for a substantially lower price than it would otherwise have had to pay and argued that this amounted to oppression.7
The chambers judge considered the central question to be whether the Supreme Court had subject matter and territorial jurisdiction.8 The chambers judge held that the determination of subject matter jurisdiction turned on the interpretation of s. 243 of the BCA. “Corporation” is defined in the BCA as “a body corporate incorporated or continued under this Act and not discontinued under this Act.” Thus, under the BCA the word “corporation” refers only to companies that are currently incorporated under the legislation. As a result, s. 243 applies only to companies presently incorporated under the legislation.9
The judge held that a claim in oppression could not be brought against the respondents as none of the corporations were currently incorporated under the BCA. As a result, the Supreme Court did not have subject matter jurisdiction.10
The Appeal
On appeal, the issue was whether the Supreme Court has subject matter jurisdiction to hear an application for an oppression remedy under s. 243 of the BCA in respect of oppressive conduct committed before a corporation is subsequently discontinued under the BCA and continued in another jurisdiction.11
The appellant argued that because Katanga was incorporated under the BCA and never discontinued it remains a corporation within the meaning of the BCA and that its status as a corporation must be measured at the time the oppressive conduct occurred, not at the time the claim is brought. Further, the appellant argued that s.243 (the oppression remedy), when read together with s. 191(9)(c) (requirements to continue into another jurisdiction), preserves the exclusive jurisdiction of the Yukon courts over a claim of oppression that arises before a corporation is discontinued.12
The respondents argued that the Yukon courts lack jurisdiction under s. 243 of the BCA over companies not incorporated in Yukon. They asserted that Katanga ceased to exist as a corporation under the BCA upon amalgamation into New Katanga. They emphasized that New Katanga, now an extraterritorial body corporate, is not subject to the BCA’s oppression remedy. The respondents also argued that the appellant’s interpretation of s. 191(9)(c) is inconsistent with other provisions of the BCA, and that claims should be pursued in the new jurisdiction, not Yukon.13
The Court confirmed that the real and substantial connection between the action, the parties and the territory over which the court exercises jurisdiction is relevant to the question of territorial, not subject matter, jurisdiction.14 The Court also addressed the nature of the oppression remedy and held that it is not a statutory tort. Rather, oppression is a statutory remedy designed to correct corporate misconduct when reasonable expectations are violated.15
The Court did not accept the appellant’s argument that the Supreme Court judge’s interpretation results in a corporation avoiding liability by discontinuing under the BCA and continuing in another jurisdiction once it is already subject to a claim or a cause of action. The Court stated that no liability is avoided because the continued body corporate continues to be liable for the obligations of the corporation and any existing cause of action or claim can be pursued in the new jurisdiction.16
The effect of amalgamation is that once Katanga amalgamated with the numbered Yukon company, it continued as New Katanga. This means that the original companies are fused into the amalgamated company.17 The amalgamated corporation continues to be liable for the obligations of each amalgamating company. However, once New Katanga discontinued out of Yukon, it continued as a corporation under the laws of its new jurisdiction and was no longer a corporation within the meaning of the BCA.
The Court also emphasized the principles of statutory interpretation set out in Rizzo & Rizzo Shoes Ltd. (Re), 1998 CanLII 837 (SCC), [1998] 1 S.C.R. 27 at para. 21. In applying the principles, the Court determined that the words in s. 191, when read with the definition of “corporation” and the scheme of the BCA, establish that the BCA will no longer apply to a corporation that is approved by the registrar to continue in a foreign jurisdiction.18
Key Takeaways
- The Court confirmed that a claim for oppression can only be brought against a corporation currently incorporated under the BCA. The Court lacks jurisdiction over corporations discontinued under the BCA and continued in another jurisdiction.
- The oppression remedy under s. 243 of the BCA is not a statutory tort but an equitable remedy designed to correct corporate misconduct when reasonable expectations are violated.
- Upon amalgamation, the original companies fuse into the new entity, which inherits their obligations. However, once the new entity is discontinued under the BCA, it is no longer subject to the BCA’s provisions.
- The BCA does not apply to corporations approved to continue in a foreign jurisdiction, aligning with principles of statutory interpretation.
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1 Cheng v. Glencore plc, 2024 YKSC 27.
2 Cheng v. Glencore plc, 2025 YKCA 8 at para. 22.
3 Ibid at para. 31.
4 Ibid at para. 5.
5 Ibid.
6 Ibid.
7 Ibid at para. 7.
8 Ibid at para. 15.
9 Ibid at para. 22.
10 Ibid.
11 Ibid at para. 23.
12 Ibid at para. 24.
13 Ibid at para. 28.
14 Ibid at para. 25.
15 Ibid at para. 38.
16 Ibid at para. 42.
17 Ibid at para. 34.
18 Ibid at para. 48.