The Patriation of Canadian Corporate Law

Abstract

Canadian corporate law belongs within a broader Anglo-American legal tradition, sharing many of the features of other common law jurisdictions, most notably England and the United States. Prior to Confederation, Canadian corporate law first emerged from nineteenth-century English legislation and continued to resemble English law—at least superficially—well into the twentieth century. In the 1970s, Canadian corporate law moved closer to the United States, as major legislative reforms, including the Canada Business Corporations Act, were significantly influenced by American statutes. From a legislative perspective, Canada has clearly been influenced by developments from beyond its borders.

Legislation is only one source of corporate law, however. Just as important is the creation of legal rules through the common law adjudicatory process. Thus, examining case law raises an important empirical question distinct from, though relevant to, the issue of legislative influence—namely, what have been the major influences on Canadian judicial lawmaking? This article addresses this question through a comprehensive citation analysis of substantially all corporate law decisions by Canadian courts of appeal since 1867.

The primary findings are as follows:

(1) Over the past 150 years, Canadian corporate law—once dominated by English precedent—has become increasingly characterized by domestic Canadian precedent;

(2) Historically, the Judicial Committee of the Privy Council played an important role in maintaining English influence, such that the prominence of English precedent decreased after 1949; and

(3) Despite the increasing influence of Canadian precedent throughout the Canadian legal system, Canadian courts continue to cite English cases when addressing unsettled legal issues, preserving a channel for the continuing influence of English jurisprudence in Canada.

Surprisingly, Canadian judicial decisions rarely cite American cases, challenging the notion that Canadian courts have been significantly influenced by American law. Ultimately—and despite residual English influence—Canadian corporate law has formed its own distinct identity.

Keywords: corporate law, empirical legal research, legal history

JEL Classification: K22