Can third parties sue Ontario corporate directors directly without going through the corporation?

Yes, in certain circumstances. A third party — a customer, supplier, employee, or member of the public — can bring a claim directly against a director without first having to obtain judgment against the corporation. This is most common when the director personally participated in conduct that caused the third party harm.

For example, if a director personally made a fraudulent misrepresentation to a counterparty to induce them to enter a contract, that party can sue the director directly for the misrepresentation, regardless of whether the corporation also has liability. Similarly, if a director was personally negligent in a way that caused physical injury or property damage, the injured party can name the director personally.

What third parties generally cannot do is sue a director simply because they are a director and the corporation cannot pay its debts. The director is not a guarantor of the corporation's commercial obligations by virtue of the role. The claim against the director personally must be grounded in the director's own wrongful act — a misrepresentation, participation in a tort, breach of a personal duty, or a statutory liability the director owes directly. If you are a director who has been named personally in litigation by a third party, separating what conduct is attributed to you personally versus to the corporation is essential to understanding the nature and strength of the claim.