In Atwood v. National Police Federation, the Ontario Superior Court of Justice considered whether a voting member’s proposal to amend the articles of a federal not-for-profit corporation (NFP), National Police Federation (NPF or Corporation), could require the board of directors to treat decisions of its Nominations and Elections Committee (NEC) as final and binding. In its decision released on May 26, 2026, the court held that the proposal was contrary to the Canada Not-for-profit Corporations Act (CNCA) because it would restrict the board’s statutory authority to manage and supervise the affairs of the Corporation and interfere with the directors’ oversight responsibilities. In doing so, the court confirmed that restrictions on directors’ powers of this nature may only be implemented through a unanimous member agreement (UMA) under section 170 of the CNCA, and not through an amendment to the articles. The decision serves as an important reminder to charities and NFPs that member proposals and governance reforms cannot be used to displace the board’s supervisory role where the CNCA reserves that type of restriction to a UMA.
Mr. Atwood, a voting member of the NPF, submitted a proposal for consideration at the NPF’s annual general meeting following a dispute concerning the board’s decision to overturn an NEC determination regarding his eligibility to stand for election as a director of the Corporation. The proposal sought to amend the NPF’s articles to provide that NEC decisions would be “final and binding”. The NPF refused to include the proposal in its notice of meeting on the basis that it was contrary to the CNCA.
The court held that the proposal was properly excluded. Relying on section 124 of the CNCA, the court emphasized that directors are responsible for managing or supervising the management of the Corporation’s activities and affairs. Although the proposal was framed as a measure to protect the independence of the NEC, its practical effect would be to make committee decisions binding on the board and limit the directors’ ability to exercise their statutory oversight responsibilities.
The court further held that any restriction on the board’s powers must be implemented through a UMA under section 170 of the CNCA. Since the proposal sought to achieve that result through an amendment to the Corporation’s articles, it was inconsistent with the statutory governance framework established by the CNCA. The court found that the proposal would interfere with the directors’ ability to fulfill their core fiduciary responsibilities. The court also held that, while subsection 163(6) of the CNCA does not expressly list “illegality” as a ground for excluding a proposal, such authority is implicit in the CNCA given the board’s obligation to ensure that the Corporation’s articles are lawful.
The decision follows an earlier Ontario Superior Court decision involving the same parties, discussed in our May 2026 Charity & NFP Law Update, in which the court dismissed an oppression claim arising from the NPF election process. Together, the decisions demonstrate the court’s reluctance to interfere with internal governance decisions where an NFP acts within the framework established by its governing documents and the CNCA.
For federally incorporated charities and NFPs, the case serves as a reminder that where a proposal would make committee decisions binding on the board, restrict directors’ oversight authority, or otherwise interfere with directors’ ability to discharge their fiduciary obligations, it may be found contrary to the CNCA and properly excluded from a notice of meeting. The decision also highlights the importance of section 170 of the CNCA and the limited circumstances in which members may restrict directors’ powers through a UMA rather than through ordinary amendments to a corporation’s articles or by-laws.