A Board Resolution He Barely Remembered Signing Came Back

The situation

The letter came by courier on a Tuesday, addressed to Fatmir personally rather than to the company, and it opened by quoting a paragraph from a document he had not looked at in nearly three years. It referenced a board resolution he had signed when he joined the board of a small nursery and landscape supply company as a favour to an old acquaintance, back before his own landscaping business was anything more than weekend work. The letter's message was blunt: the resolution he had signed restricted him from competing with that company's services, the restriction was still in force, and his current company's bid on a large commercial maintenance contract needed to be withdrawn. It was signed by Sunita, who had taken over as the nursery company's board chair not long after Fatmir stepped down, and whom Fatmir barely knew beyond a handful of shared meetings years earlier.

Fatmir worked full time as a call-centre representative and had built the landscaping business on evenings and weekends with Besnik, who worked as a landscaper by trade, and two other partners who had come in as the work grew. What started as mowing and seasonal cleanup for a handful of residential clients had become a real company with close to a hundred thousand dollars in annual revenue, four shareholders on paper, and, for the first time, a shot at a maintenance contract large enough to change the business's trajectory.

The nursery company was a separate business entirely, run by different people day to day, and Fatmir's role on its board had always been minor. He attended a handful of meetings a year and had stepped down from that board himself several months earlier, once the nursery company began adding installation and maintenance services that started to look like direct competition with his own growing company. He had thought resigning ended his connection to it, and had never so much as spoken with Sunita, who joined the nursery company's board only after his own decision to leave, about what the years-old resolution might still mean for him.

He had not read the resolution he was being held to closely when he signed it. It had been presented at a routine board meeting years earlier, bundled with several other approvals, and he had signed the page along with the rest of the board without asking what it actually committed him to individually, as opposed to the company generally. Now that document was the only thing standing between his landscaping company and a contract worth more than the business had ever taken on before.

What the documents showed

The first step was getting an actual copy of the resolution, not the paraphrased quote in the demand letter. What it showed was more specific, and in some ways narrower, than the letter suggested. The resolution had been drafted as a conflict-of-interest waiver for the board generally, addressing a different matter entirely from years earlier, and buried within it was a clause stating that directors would not, during their time on the board and for a period after leaving it, solicit or bid on contracts the nursery company was actively pursuing at the time of a director's departure.

Two things mattered immediately. First, the clause was tied to contracts the nursery company was actively pursuing at the time Fatmir resigned, not to its business generally, and the large commercial contract now in dispute had not existed at all when he stepped down; it had gone to tender only afterward. Second, restrictive covenants like this one are only enforceable in Ontario to the extent they are reasonable in scope, geography and duration, and a clause drafted for a conflict-of-interest situation years earlier, applied retroactively to a contract that did not yet exist when the director left, sat on genuinely weak ground.

That did not mean the nursery company had no argument at all. The resolution was validly signed, Fatmir had been a director in good standing when he agreed to it, and its language about post-departure restrictions was broad enough that a court asked to interpret it might not read it as narrowly as we did on a first pass. The nursery company's demand letter was an opening position, not a settled legal conclusion, and treating it as bulletproof would have meant giving up a major contract over a document whose reach was genuinely contestable.

What the documents also showed, reading between the two companies' histories, was why the letter had landed now. The nursery company had lost out on a smaller bid to Fatmir's company months earlier and had grown uneasy about direct competition from someone who had so recently sat on its own board. The resolution gave it a plausible-sounding hook to raise; whether that hook actually held was a separate question from whether raising it was a fair fight to pick.

Sunita's own position mattered here too. She had not been on the board when the resolution was drafted or when Fatmir signed it, and had inherited both the document and the company's frustration over the lost bid rather than having lived through the original conflict-of-interest situation the resolution was meant to address. That did not make the letter any less serious to respond to, but it did suggest the demand was being driven more by present competitive pressure than by a considered legal position built from first principles.

What we did

1. Obtained the full text of the resolution rather than relying on the letter's summary, because a demand built on a quoted fragment often reads very differently once the surrounding clauses and its original context are visible in full, and we wanted to see exactly what Fatmir had agreed to rather than argue against a paraphrase someone else had chosen for him. The nursery company's counsel supplied a certified copy within days once asked directly.
2. Confirmed the timeline against the tender records for the disputed contract, establishing that it had gone to tender after Fatmir's resignation from the nursery company's board, which was the single strongest fact undercutting the claim that his bid violated a restriction tied to contracts being actively pursued at the time he left, since the contract simply did not exist yet on that date.
3. Assessed the covenant's enforceability generally, looking at how broadly it was worded, how long the restriction was meant to last, and whether it was reasonable for the conflict-of-interest situation it was originally drafted to address, since an overly broad restraint on someone's ability to earn a living is not automatically enforceable in Ontario just because a signature is on the page.
4. Advised Fatmir and his three co-shareholders on the actual exposure in plain terms, distinguishing between the nursery company having a technically arguable claim and having a claim strong enough to justify walking away from the contract, so the decision about how hard to push back was made with real information rather than fear of the letter's confident tone. All four shareholders needed to agree on the approach, since the contract's success or failure affected everyone's stake equally.
5. Responded to Sunita and the nursery company's counsel directly, laying out the timeline discrepancy and the reasonableness problem with the covenant as drafted, and proposing a negotiated release rather than an immediate standoff, since litigation over a several-year-old resolution neither side had drafted with this scenario in mind would have cost both sides more than the dispute was worth.
6. Negotiated a narrowed, written release confirming Fatmir was free to bid on and perform the disputed contract and any future work, in exchange for a mutual acknowledgment that neither company would solicit the other's existing staff for a defined period, which addressed Sunita's real underlying concern about losing people to a competitor without costing Fatmir's company the work. Getting it in writing meant the question could not resurface on the next contract without a fresh basis.
7. Reviewed the landscaping company's own governance with all four shareholders once the immediate dispute was resolved, making sure future board approvals and resolutions were read and understood individually before anyone signed, rather than bundled and approved as a group without real discussion, since the same gap that had exposed Fatmir was sitting unnoticed in their own paperwork. That review turned up two other bundled approvals none of the four had actually discussed line by line.
8. Set up a short internal conflict-of-interest policy for the landscaping company itself, covering what happens if any shareholder takes on an outside board seat or ownership stake in a related business in future, so the company would not find itself on the other side of a similar letter years from now without having thought the risk through in advance. The policy also set out who reviews new outside commitments before a shareholder accepts them, so the next board seat gets a second set of eyes before a signature goes on it.

The outcome

The contract went ahead. Sunita and the nursery company accepted the narrowed release once it was clear the timeline undercut its original position and once the company had its own concession in writing, the mutual staff non-solicitation term, to point to as something gained from the exchange rather than a total climb-down. Fatmir's landscaping company kept the bid, took on the contract, and did not have to walk away from the largest piece of work it had ever been offered.

It was not a clean vindication. The release did not establish that the original resolution was unenforceable in every circumstance, only that it did not reach this particular contract, and the staff non-solicitation term Sunita's company negotiated in return was a real constraint the landscaping company had to live with for a defined period afterward, limiting how it could recruit in a tight local labour market for seasonal landscaping work. Both sides gave up something to close the matter rather than litigate a several-year-old document neither one had drafted with this exact scenario in mind.

For Fatmir personally, the larger lesson was about what he had actually agreed to years earlier without reading it closely, and about how a relationship he considered minor, a board seat taken as a favour, could resurface with real consequences once circumstances changed. A board resolution signed on a routine meeting agenda can carry obligations that outlast the seat itself, and stepping down from a board does not automatically erase commitments made while sitting on it. The company came out of the dispute with the contract it wanted, a written release it could point to if the question ever came up again, and a clearer governance habit going forward covering all four shareholders, which mattered more, in the end, than the specific letter that started it.

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