Nonprofit Board Member Personal Liability in Canada

A Canadian nonprofit director is not automatically responsible for every debt or mistake of the organization. The incorporated organization is generally a separate legal person. Personal exposure can still arise from a director’s own conduct or from a statute that assigns liability for a defined obligation, such as specified unpaid wages or payroll remittances. The governing law and the elements of the particular claim matter. “Nonprofit” describes a purpose, not one uniform corporate statute. An organization may be incorporated federally under the Canada Not-for-profit Corporations Act (CNCA), under provincial nonprofit or societies legislation, or under a special statute. It may also be a registered charity under the Income Tax Act, but charitable registration does not identify its corporate law.