Ontario's Business Corporations Act does not treat dissolution as the end of a corporation's exposure — a buyer can still sue the dissolved shell, but real recovery runs against each shareholder personally, capped at what that individual actually received.
Short answer
Dissolution does not extinguish the indemnity claim, but real recovery shifts from the (now empty) corporate covenantor to its former shareholders individually, each liable only up to the amount of property that particular shareholder actually received on the distribution — not the total claim, and not joint among however many shareholders there were.
Ontario's Business Corporations Act, R.S.O. 1990, c. B.16, s.242(1), provides that despite dissolution, “a civil, criminal, administrative, investigative or other action or proceeding may be brought against the corporation as if it had not been dissolved.” Dissolution is not a defence to being sued — it changes how the defendant is served, not whether it can be one. That gets a buyer a claim against an empty shell.
The provision that actually matters is s.243(1): “each shareholder to whom any of its property has been distributed is liable to any person claiming under section 242 to the extent of the amount received by that shareholder upon the distribution, and an action to enforce such liability may be brought.” The liability is personal to each shareholder, and capped at what that individual actually received — not the total claim. Section 243(2) lets the court run the claim as a representative action against several former shareholders as a class, rather than requiring separate suits against each.
Which regime applies turns on where the indemnitor was incorporated. The federal Canada Business Corporations Act, s.226(2)(b) and (4), carries an explicit two-year window running from the dissolution date that the current Ontario Business Corporations Act text does not — an Ontario-incorporated seller leaves a buyer relying on Ontario's general limitation periods instead of a fixed statutory clock tied to the dissolution date.
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