Articles & Cases

Use of Exact Corporate Name

April 08, 2004

In Ontario the name of a for-profit corporation is set out in the Articles of Incorporation. From the date of incorporation we would point out that you should use the exact corporate name of the Corporation. Subsection 10(5) of the Business Corporation Act (Ontario) requires a corporation to set out its name in all contracts, invoices, negotiable instruments and orders for goods or services issued or made by or on behalf of the corporation. The use of either the word "Limited", "Limitée", "Incorporated", "Incorporée" or "Corporation" or the corresponding abbreviations "Ltd.", "Ltée", "Inc." or "Corp." indicates to a third party that the Corporation has limited liability. Accordingly, the exact full name of the corporation should appear on all such documents as well as on any website, fax cover pages, cheques, bank accounts, telephone listings, e-mail addresses, e-mail signature files, forms, marketing brochures, packaging, signage, business cards, letterheads, government forms, licences, etc..

FAILURE TO USE THE EXACT CORPORATE NAME OF THE CORPORATION CAN RESULT IN THE LOSS OF THE LIMITED LIABILITY STATUS OF THE CORPORATION WHICH CAN RESULT IN THE DIRECTORS, OFFICERS, EMPLOYEES OF THE CORPORATION BEING HELD PERSONALLY LIABLE FOR DEBTS AND OBLIGATIONS OF THE CORPORATION.

If the third party is not made abundantly clear that they are dealing with a incorporated entity then the third party can argue that they were not aware that there was a incorporated entity and that they thought they were negotiating, contracting, binding yourself personally and that you should not be entitled to use the corporation as a shield and enjoy limited liability protection. Always use proper signing lines indicating that you are signing on behalf of the Corporation as an authorized signing officer.