Medical Professional Corporations Act
CHAPTER 11 OF THE ACTS OF 1995-96
An Act to Permit Physicians
to Incorporate for the Purpose of Carrying on
the Practice of Medicine
1 This Act may be cited as the Medical Professional CorporationsAct. 1995-96, c. 11, s. 1.
2 In this Act,
(a) "Council" means the Council of the College of Physiciansand Surgeons of Nova Scotia constituted by the Medical Act;
(b) "Minister" means the Minister of Health;
(c) "permit" means a permit issued to a professional corporationpursuant to this Act;
(d) "physician" means a medical practitioner as defined by theMedical Act;
(e) "practice of medicine" means the practice of medicine,surgery, obstetrics, pathology, radiology and specialties thereof bya physician;
(f) "professional corporation" means a company incorporatedpursuant to the Companies Act for the purpose of carrying on thepractice of medicine;
(g) "Registrar" means the Registrar under the Medical Act;
(h) "spouse" means a person married to another person andincludes either of a man and woman who, not being married toeach other, live together as husband and wife and have so lived forat least one year. 1995-96, c. 11, s. 2.
3 Subject to this Act and the regulations, a professional corporationmay engage in the practice of medicine and physicians may be employedby a professional corporation for the purpose of engaging in the practiceof medicine. 1995-96, c. 11, s. 3.
Ownership of majority of shares
4 (1) A majority of the issued shares of a professional corporationshall be legally and beneficially owned by one or more physicians.
Ownership of majority of voting shares
(2) A majority of the issued voting shares of a professional corporationshall be legally and beneficially owned by one or more physicians.
Right to own shares
(3) Subject to subsections (1) and (2), any person may own,beneficially or legally, shares of a professional corporation.
Right to hold shares as trustee
(4) Notwithstanding subsections (1) and (2), a person resident inCanada may hold legal title to issued shares of a professional corporationsolely as trustee for the exclusive benefit of a physician, or the spouse orchild of a physician, or a group of such individuals pursuant to a trustsettlement governed by the laws of the Province, but no one other thana physician, or the spouse or child of a physician, shall act as such atrustee without the written consent of the Registrar. 1995-96, c. 11, s. 4.
Qualifications of directors
5 All of the directors of a professional corporation that is engaged inthe practice of medicine shall be physicians. 1995-96, c. 11, s. 5.
Restriction on right to practise
6 A professional corporation shall not engage in the practice ofmedicine unless the corporation holds a permit pursuant to this Act andthe corporation is in compliance with this Act and the regulations. 1995-96, c. 11, s. 6.
Right to practise under corporate name
7 (1) Notwithstanding any other provision of this Act, aprofessional corporation to which a permit is issued pursuant to thisSection may practise medicine in its own name.
Prohibition of registration of corporation
(2) Notwithstanding subsection (1), no professional corporation shallbe registered as a physician pursuant to the Medical Act.
(3) The Registrar shall issue a permit to any professional corporationthat
(a) files all required applications in the form prescribed by theregulations;
(b) pays all fees prescribed by the regulations;
(c) satisfies the Registrar that it is a company limited by sharesin good standing with the Registrar of Joint Stock Companiesunder the Companies Act and the Corporations Registration Actand that it is a private company as defined by the Securities Act;
(d) satisfies the Registrar that the name of the corporation is inaccordance with the regulations;
(e) satisfies the Registrar that the legal and beneficial ownershipof all of the issued shares of the corporation satisfies the requirements of Section 4;
(f) satisfies the Registrar that all of the directors of thecorporation are physicians;
(g) satisfies the Registrar that the corporation holds such liabilityinsurance as may be prescribed by the regulations; and
(h) satisfies the Registrar that the persons who will carry on thepractice of medicine for or on behalf of the corporation arephysicians.
Life of permit
(4) A permit issued pursuant to subsection (3), or any renewal thereofpursuant to subsection (5), expires on December 31st of the year forwhich it was issued or renewed.
(5) The Registrar may renew a permit upon such application andpayment of such fee as may be prescribed by the regulations where theRegistrar determines that the requirements of subsection (3) are satisfiedby the professional corporation.
Suspension or revocation
(6) A permit issued pursuant to subsection (3), or renewed pursuant tosubsection (5), may be suspended or revoked at any time by the Registrarwhere a professional corporation fails to satisfy any of the requirementsof subsection (3).
Review of decision
(7) The Council may, in its discretion, review a decision of theRegistrar to suspend or revoke a permit pursuant to subsection (6).
Interpretation of practice of medicine
(8) For the purpose of this Act, the practice of medicine is not carriedon, and shall not be deemed to be carried on, by clerks, secretaries,nurses and other persons employed by a professional corporation toperform services that are not usually and ordinarily considered by law,custom and practice to be services that may be performed only by aphysician. 1995-96, c. 11, s. 7.
"physician owner" defined
8 (1) In this Section, "physician owner" means a physician who isthe legal and beneficial owner of issued voting shares of a professionalcorporation.
Deemed revocation of permit
(2) Where a professional corporation practises medicine only throughthe services of a physician owner and no other physician, and thatphysician owner dies, becomes incompetent or is no longer registeredpursuant to the Medical Act, or is suspended pursuant to that Act, thepermit of the corporation is deemed to be revoked and the corporationshall cease to practise medicine.
Consequences of failure to comply
(3) Where a professional corporation practises medicine through theservices of at least one physician other than the physician owner and thecorporation ceases to fulfil any requirement of subsection 7(3) by reasonof
(a) the death of the physician owner;
(b) the incompetency of the physician owner;
(c) the physician owner ceasing to be a physician as defined bythis Act; or
(d) the suspension of the physician owner pursuant to theMedical Act,
the corporation shall forthwith notify the Registrar and shall fulfil therequirements in question within one hundred and twenty days from thedate of death, incompetency, ceasing to be a physician or the suspension,as the case may be, of the physician owner, failing which the permit isrevoked and the corporation shall cease to practise medicine effectiveupon the expiration of the one hundred and twenty day period.
(4) Where a majority of the issued voting shares of a professionalcorporation are legally and beneficially owned by two or more physicianowners and the corporation ceases to fulfil any requirement referred toin subsection 7(3) by reason of
(a) the death of a physician owner;
(b) the physician owner ceasing to be a physician as defined bythis Act; or
(c) the suspension of a physician owner pursuant to the MedicalAct,
the corporation shall forthwith notify the Registrar and shall fulfil therequirements in question within one hundred and twenty days from thedate of death, ceasing to be a physician or the suspension, as the casemay be, of the physician owner, failing which the permit is revoked andthe corporation shall cease to practise medicine upon the expiration of theone hundred and twenty day period.
Application for reinstatement
(5) Where the permit of a professional corporation is revoked pursuantto this Section and thereafter the corporation is able to demonstrate thatit is in compliance with subsection 7(3), the corporation may apply to theRegistrar to have its permit reinstated and the Registrar may, in thediscretion of the Registrar, reinstate the permit subject to such conditionsas the Registrar may determine. 1995-96, c. 11, s. 8.
Notice of certain changes
9 Where the shares of a professional corporation engaged in thepractice of medicine are transferred or where there is a change in theshareholders, directors or officers of such corporation, or any change inthe location where such corporation carries on business, the corporationshall, within fifteen days, notify the Registrar of such transfer or change. 1995-96, c. 11, s. 9.
Application of Medical Act unaffected
10 The relationship of a physician to a professional corporation,whether as a shareholder, director, officer or employee, does not affect,modify or diminish the application of the Medical Act and the regulationsmade pursuant to that Act to the physician. 1995-96, c. 11, s. 10.
11 (1) All persons who carry on the practice of medicine by,through or on behalf of a professional corporation are liable in respect ofacts or omissions done or omitted to be done by them in the course of thepractice of medicine to the same extent and in the same manner as if suchpractice were carried on by them as an individual or a partnership, as thecase may be, carrying on the practice of medicine.
Restriction on voting rights
(2) No owner of voting shares of a professional corporation shallpledge, hypothecate, enter into a voting trust, proxy or any other type ofagreement vesting in any other person who is not a physician theauthority to exercise the voting rights attached to any or all of theowners shares. 1995-96, c. 11, s. 11.
Confidentiality and ethics
12 (1) Nothing contained in this Act affects, modifies or limits anylaw applicable to the confidential or ethical relationships between aphysician and the physicians patient.
Relationship with patients unaffected
(2) The relationship between a professional corporation and a patientof the corporation is subject to all applicable law relating to theconfidential and ethical relationships between a physician and thephysicians patient.
Other rights and obligations unaffected
(3) All rights and obligations pertaining to communications made to orinformation received by a physician apply to the shareholders, directors,officers and employees of a professional corporation. 1995-96, c. 11, s. 12.
13 All shareholders, directors, officers and employees of aprofessional corporation are compellable witnesses in any proceedingspursuant to this Act or the Medical Act. 1995-96, c. 11, s. 13.
Certificate as evidence
14 A certificate purporting to be signed by the Registrar stating thata named professional corporation was or was not, on a specified day orduring a specified period, a professional corporation entitled to practisemedicine according to the records of the Registrar, shall be admitted inevidence as prima facie proof of the facts stated therein without proof ofthe Registrars appointment or signature. 1995-96, c. 11, s. 14.
Consequences of commission of offence
15 Where a professional corporation commits an offence contrary to thisAct or the regulations, every person who, at the time of the commission ofthe offence, was a director or officer of the corporation is guilty of thesame offence and subject to the same penalties unless the act or omissionconstituting the offence took place without the persons knowledge orconsent or the person exercised all due diligence to prevent thecommission of the offence. 1995-96, c. 11, s. 15.
Offence and fine
16 (1) Every person who contravenes this Act or the regulations isguilty of an offence and liable, on summary conviction, for a first offenceto a fine not exceeding five hundred dollars and for a second or anysubsequent offence to a fine not exceeding one thousand dollars.
Automatic suspension of permit
(2) Where a professional corporation is convicted of an offencecontrary to this Act or the regulations, the permit of the corporation issuspended in default of paying any fine ordered to be paid until such timeas the fine is paid.
Revocation of permit
(3) Where a professional corporation is convicted of a second orsubsequent offence, the permit of the corporation may be revoked. 1995-96, c. 11, s. 16.
17 (1) Subject to subsections (2) and (3), the Council may makeregulations
(a) prescribing the manner of proof as to matters required to beproven by applicants for permits;
(b) fixing reasonable fees payable for the issuance and renewalof permits;
(c) providing that the permit of a professional corporation issuspended without notice or investigation upon contravention ofany regulation that requires the corporation to pay a fee orassessment, file a document or do any other act by a specified orascertainable date, and providing for the reinstatement of a permitso suspended;
(d) prescribing the grounds upon which the Council may reviewa decision of the Registrar pursuant to subsection 7(7) and the procedures to be followed in reviewing any such decision;
(e) providing for the reinstatement or re-issuance of any permitsuspended or revoked pursuant to this Act and prescribing theterms and conditions upon which reinstatement or re-issuance of apermit may be granted;
(f) providing for the creation and maintenance of a register ofprofessional corporations;
(g) providing for the filing of periodic returns by professionalcorporations;
(h) providing for the annual renewal of permits and prescribingthe terms and conditions upon which renewals may be granted;
(i) prescribing the types of names and business names by which
(i) a professional corporation,
(ii) a partnership of two or more professional corporations, or
(iii) a partnership of one or more professional corporations andone or more individual physicians,
may be known;
(j) prescribing the advertising that may be undertaken by aprofessional corporation;
(k) prescribing access to the minute book records of aprofessional corporation by the Registrar;
(l) prescribing any other matters necessary for the properadministration of this Act.
Obligation to consult
(2) Prior to making any regulation pursuant to this Act, the Councilshall consult and seek the advice of the Medical Society of Nova Scotiawith respect to the proposed regulation.
Approval of Governor in Council
(3) No regulation has effect until it is approved by the Governor inCouncil.
(4) The exercise of the authority contained in subsection (1) isregulations within the meaning of the Regulations Act. 1995-96, c. 11,s. 17.
18 This Act comes into force on such day as the Governor in Councilorders by proclamation. 1995-96, c. 11, s. 18.
Proclaimed - April 16, 1996
In force - April 16, 1996