IN THE SUPREME COURT OF BRITISH COLUMBIA

Citation:

Simon Fraser Student Society v. Gregory,

 

2006 BCSC 1873

Date: 20061204
Docket: S067253
Registry: Vancouver

Between:

Simon Fraser Student Society, Margo Dunnet, Erica Halpern, Shawn Hunsdale, Vanessa Kelly, Glyn Lewis, Wei Li, and Marion Pollock

Petitioners

And:

Titus Gregory, Janis Gunn, and Bryan Jones

Respondents

Before: The Honourable Mr. Justice Ehrcke

Oral Reasons for Judgment

In Chambers
December 4, 2006

Counsel for Petitioners

D.G. Crane

Counsel for Gunn, Ball, Li, Blok, Hilne, So, Sandau, Homan, Rubuliah and Lein

S.M. Coristine

 

Counsel for Jones, Gregory and Letourneau

U.K. Ottho

Place of Trial/Hearing:

Vancouver, B.C.

 

[1]                THE COURT:  This petition is brought by the Simon Fraser Student Society (the "Society") and seven directors of that society who were impeached at a special general meeting held on October 25, 2006.  That special general meeting was held pursuant to a resolution passed at a meeting of the Forum of the Society held September 27, 2006.  As a result of the impeachment, a by‑election is scheduled for December 18, 2006.  Nominations close today. 

[2]                The relief requested by the petitioners is a declaration that the Forum meeting was not lawful and that the resolutions passed at that meeting, including the resolution to hold the special general meeting, are of no force and effect.  They also apply for an order setting aside the resolutions passed at the special general meeting.

[3]                The petitioners rely on s. 85 of the Society Act, R.S.B.C. 1996 c. 433, which provides:

85  (1)  Despite anything in this Act, if an omission, defect, error or irregularity occurs in the conduct of the affairs of a society by which

(a)        a breach of this Act occurs,

(b)        there is default in compliance with the constitution or bylaws of the society, or

(c)        proceedings at, or in connection with, a general meeting, a meeting of the directors of the society or an assembly purporting to be such a meeting are rendered ineffective,

the court may

(d)        either of its own motion or on the application of an interested person, make an order

(i)         to rectify or cause to be rectified or to negate or modify or cause to be modified the consequences in law of the omission, defect, error or irregularity, or

(ii)        to validate an act, matter or thing rendered or alleged to have been rendered invalid by or as a result of the omission, defect, error or irregularity, and

(e)        give the ancillary or consequential directions it considers necessary.

(2)        The court must, before making an order, consider the effect of it on the society and its directors, officers, members and creditors.

(3)        An order made under subsection (1) does not prejudice the rights of a third party who has acquired those rights for valuable consideration without notice of the omission, defect, error or irregularity cured by the order.

[4]                Under that section I must first decide whether there has been a breach of the Act or a default in compliance with the constitution or Bylaws of the Society that would render the Forum meeting or the special general meeting ineffective.  If I find that there has been such default, I must then go on to decide whether it should be rectified and the resolutions of the meetings validated.  That decision would have to be based on a consideration of the effect on the Society and its members, directors and officers.  There is no suggestion that any creditors would be affected.

[5]                The petitioners submit that the September meeting was not a valid Forum meeting because of a lack of proper notice and because the required quorum was not present.  They submit that if either of those arguments succeed, then the resolution calling for the special general meeting was invalid and any resolutions passed at that meeting, including the impeachments, should be set aside.  They submit that I should not exercise my discretion under s. 85 to validate those meetings and resolutions because the process which led to them was undemocratic and unfair.  They say that the Forum meeting and the special general meeting were not representative of the will of the membership as a whole, but rather reflected only the interests of a small dissatisfied faction led by a group called the Students for a Democratic University.  As the petitioners put it in their written argument, "the respondents and their supporters usurped the cancelled meeting."

[6]                The respondents submit that the meetings and resolutions should be affirmed.  They say that there was no default or irregularity, that the meetings were properly convened and a quorum was present.  If there was an irregularity, they submit it should be rectified under s. 85, as the petitioning directors have not been acting in good faith and in the best interests of the Society.

Facts

[7]                The Society represents over 24,000 students.  It is governed by a Board of 16 directors who are elected annually.  Bylaw 16(2) of the Society provides that a director may be removed from office by a special resolution, which is defined by s. 1 of the Society Act as including a resolution passed at a general meeting by a majority of not less than 75 percent of the votes of those members who, being entitled to do so, vote in person.

[8]                In addition to the board of directors, the Society has a representative body called Forum, which consists of all the directors as well as a number of representatives of programs and other constituencies on campus.  The Forum’s function is largely consultative, but it also has power to convene a special general meeting.  The Bylaws provide three ways for a special general meeting to be called.  Under Bylaw 10(7)(a), a special general meeting may be convened at any time by resolution of two‑thirds of the members of the Board or Forum.  Bylaw 10(7)(b) provides that the President shall convene a special general meeting within 30 calendar days of receipt of a petition signed by five percent or more of members in good standing of the society.

[9]                On September 12, 2006, a petition signed by 2,425 students, representing 9.8 percent of the members of the Society, was presented to the President, petitioner Shawn Hunsdale.  It called for a special general meeting.  He did not convene a special general meeting pursuant to Bylaw 10(17), however.  Rather, he took the position that a petition of ten percent of the members was required by reason of s. 58(2) of the Society Act.

[10]            Meanwhile, on September 8, 2006, several days prior to the presentation of the petition, petitioner Glyn Lewis, who was a director and Member Services Officer, circulated a notice to Forum members confirming that the next meeting of Forum was scheduled for September 27, 2006, at 4:30 p.m.  He asked that members who were not able to attend send their regrets.

[11]            On September 18, 2006, the respondent Bryan Jones notified the Board that he intended to move a special resolution impeaching the petitioners.

[12]            On September 24, 2006, Glyn Lewis circulated an e‑mail saying he would appreciate members confirming if they did plan to attend the Forum meeting.  He did not say that the meeting would be cancelled if enough people failed to answer his e‑mail.  There is no requirement in the Bylaws for Forum members to inform the Member Services Officer that they intend to attend Forum meetings.  Rather, pursuant to Forum Policy FP‑1, Forum members are expected either to attend or, if they cannot, then they must request an excuse in writing.

[13]            At 7:27 p.m. on September 26, 2006, Mr. Lewis, in consultation with Mr. Hunsdale, circulated an e‑mail indicating that the Forum meeting was being cancelled due to an anticipated lack of quorum.  The e‑mail scheduled the next meeting for October 26.  In his affidavit, Mr. Lewis deposes that he believed there would not be a quorum because he received only 12 responses from members saying they would be present.  He does not depose that he received responses from the remaining members saying they would not attend or saying that they wished to seek an excuse for not attending.  Notwithstanding Mr. Lewis's September 26 e‑mail, on September 27 a meeting went ahead, which purported to be a Forum meeting.  The meeting was called to order at 4:36 p.m. by Titus Gregory.  Following a roll call, Mr. Gregory announced that 15 out of 28 members of Forum were present, and he declared that there was a quorum.

[14]            The meeting proceeded, and a number of newly elected members were ratified.  The Minutes of the meeting show that it was noted that Menolly Lysne and Jackie Hiew had already resigned.  Neither of those persons was listed in the roll call of attendance.  Five further members who were present at the meeting submitted their resignations, and a motion was passed that the resignations be accepted.  Later in the meeting, a resolution was passed to convene a special general meeting for the purpose of considering whether to impeach the seven petitioners.  By that point in the meeting there were 52 members of Forum, including the newly elected members.  The motion passed with 35 votes, which was precisely the two‑thirds majority required.

[15]            Pursuant to that resolution of Forum, a special general meeting was held on October 25, 2006.  At least 750 members of the Society attended.  This was an unusually large turnout.  The Bylaws of the Society specify that a quorum for either a special general meeting or an annual general meeting is 500 members.  Historically, that number has been difficult to achieve.  In the previous ten years no general meeting had achieved that quorum.  Five of the seven petitioners attended the special general meeting and spoke against the special resolutions of impeachment.  All seven of the petitioners were impeached at that meeting by votes ranging from 86.4 percent to 99.2 percent.  Following that meeting, a by‑election was called as required by Bylaw 15(3).

Issues

[16]            The petition before me raises three issues: 

1          Was the Forum meeting on September 27 invalid because of lack of notice or because it was cancelled by the Member Services Officer?

2          Was there the required quorum at the Forum meeting? 

3          If the Forum meeting was defective for either of those reasons, should the defects be rectified pursuant to s. 85 of the Society Act?

Notice

[17]            The petitioners contend that the September 27 meeting cannot be considered a valid meeting of Forum because the Member Services Officer sent a notice cancelling the meeting on September 26.  As a result, some members who might otherwise have attended the meeting stayed away in the belief that the meeting had been cancelled.

[18]            The Bylaws contain no provision granting the Member Services Officer unilateral power to cancel a Forum meeting after it has been duly scheduled.  Nevertheless, the petitioners argue that there was a past practice of such cancellations.

[19]            In my view, past practice is not determinative of this issue.  If in the past a person without authority to cancel a meeting nevertheless purported to do so, the issue of the validity of the cancellation would not arise if in fact no one attended the meeting.  In such a case, the real reason for the meeting not proceeding would be the lack of a quorum rather than any legally binding effect of the notice of cancellation.  That is presumably what happened in the past.  Because no one showed up for the purportedly cancelled meetings, the issue of the legal effect of the notice of cancellation was moot.

[20]            With respect to the September meeting, however, the issue was for the first time not moot because in fact members attended at the time and place appointed and proceeded to hold a meeting.

[21]            The petitioners submit that the meeting which was held cannot have been a true Forum meeting because the Member Services Officer had cancelled it less than 24 hours before its scheduled start.  In fact, what Mr. Lewis had done in his September 26 e‑mail was to purportedly adjourn the meeting from September 27 until October 26.  The question is whether he had the legal authority to do so.

[22]            A similar issue arose in Gill v. Bhandal (1998), 165 D.L.R. (4th) 151, [1998] B.C.J. 2263 (B.C.S.C.).  That case concerned a dispute between two factions that ran the Khalsa Diwan Society.  The executive committee had called a meeting.  Prior to the commencement of the meeting, the President, realizing that he was going to be in a minority position, purported to cancel the meeting and left with seven members.  The remaining nine members went on to pass a resolution.  The minority then petitioned the court to set aside the resolution on the basis that the meeting had been adjourned before the resolution was considered.  Koenigsberg J. concluded that the President had no authority in the circumstances to unilaterally adjourn the meeting.  She held at paras. 51 through 55:

51        I will deal first with whether the President, in the circumstances, was justified in unilaterally adjourning the meeting.

52        Both parties put before the Court Roberts Rules of Order, and several case authorities discussing what circumstances justify a unilaterally adjourned meeting. First, it is agreed that generally speaking a President may only adjourn a meeting, without an approving vote of the Majority, at the close of all business of a meeting or in an emergency. J.M. Wainberg, Q.C. and Mark I. Wainberg, Wainberg's Society Meetings Including Rules of Order, (Toronto: C.H.G. Canadian Ltd., 1992) at p. 141 state:

The Chair has no power to close the meeting without the consent of the meeting, except:

-- where discussion has degenerated and the transaction of business has become impossible,

-- where a quorum is lacking, or

-- when all the business of the meeting has been concluded.

To the same effect, see the reasons of the English Court of Appeal in Byng v. London Life Association Ltd. (1988), 42 B.L.R. 280.

53        I am satisfied that the case authorities support the following proposition. A unilateral adjournment may be justified when on the grounds of safety or practicability a vote cannot be taken.

54        Thus, on the facts as I have found them outlined above, the President was neither faced with a situation where the physical safety of the members was imperilled to such an extent a vote could not be taken, nor was there such a degeneration in the conduct of the meeting that a vote could not have been taken. On all the evidence, it was all too clear to the President that if he did not adjourn the meeting unilaterally, the meeting would not be adjourned and the majority will would prevail -- a majority with whom he was in profound disagreement.

55        The adjournment was not valid and the meeting could commence or continue with a quorum.

[23]            In my view, the same principles apply to the present case.  The Bylaws did not empower Mr. Lewis to make a unilateral decision to cancel or adjourn the September 27 Forum meeting after it had been called and proper notice given, merely on the basis that Mr. Lewis speculated there might not be a quorum.  Whether or not a quorum would be achieved could only be determined when the scheduled time for the meeting had arrived.  There were no issues of safety or practicality that would have precluded waiting until the appointed time and date to see if a quorum could be achieved.  On the contrary, the evidence suggests that the true reason for purporting to cancel or adjourn the meeting was in order to frustrate the announced intent of proceeding with steps that would ultimately lead to a vote on a resolution of impeachment at a general meeting.

[24]            The petitioners argue that the resulting meeting was unfair because some persons may have failed to attend due to confusion over whether a valid meeting was taking place.  In my view, whatever confusion ensued was caused by the petitioner Lewis' own actions in purporting to issue a cancellation notice when he had no authority to do so.  He and the other petitioners cannot now rely on Mr. Lewis's unauthorized action to support their claim for relief.  Were it otherwise, anyone who lacked de jure authority to cancel a meeting could nevertheless effectively do so de facto simply by issuing a notice to cause confusion.

[25]            I am satisfied that there was proper notice to all interested parties of the time and place for the September 27 meeting.  That notice was given by Mr. Lewis in his September 8 e‑mail.  The fact that he later sent another unauthorized e‑mail purporting to adjourn the meeting less than 24 hours before it was to begin, does not demonstrate that the meeting that went ahead as originally scheduled was without proper notice.

Quorum

[26]            At the start of the September meeting, 15 members were present.  At the close of the previous Forum meeting held on July 19, 2006, there were 30 Forum members, but two of them, Menolly Lysne and Jackie Hiew, had submitted their resignations prior to September 27.  A quorum required the presence of 50 percent plus one of the Forum members.  The issue of whether there was a quorum turns on whether those two resignations were effective prior to the start of the September meeting.  If they were, then the 15 members present constituted a quorum of the 28 members.  The petitioners submit, however, that the two resignations could not take effect until they were ratified at the meeting.  In that case, there would have been a total of 30 members at the start of the meeting and 15 members would not constitute the majority required for a quorum.

[27]            The petitioners say that the formal ratification of resignations by Forum members is a matter of policy and normal practice.  They say the normal practice was for resignations to be ratified.  They submit that this position is supported by the use of the word "accepted" in Bylaw 16(1) which provides:

16(1)    Once any member of the Board or Forum ceases to be a member in good standing of the Society, his or her resignation shall be deemed to have been delivered to and accepted by the Society, and the Board or Forum Chair shall declare the position vacant forthwith.

[28]            The petitioners submit that the only reasonable interpretation of this Bylaw is that the Society has a policy of ratifying resignations after they are delivered to the Society.

[29]            The petitioners also submit that this policy is consistent with Roberts Rules of Order (10th ed.), which provides at p. 279:

The duties of a position must not be abandoned until a resignation has been accepted and becomes effective, or at least until there has been reasonable opportunity for it to be accepted.

[30]            Roberts Rules do not govern this issue, however, if the Bylaws or Policies adopted by the Society provide otherwise.  The respondents point to Forum Policy FP‑1(3), adopted January 18, 2006, which provides:

FP‑1(3)            Notices of resignation from Forum shall be directed to the Member Services Officer and reported at the subsequent meeting of Forum.  Notices of resignation shall also be sent to the representative's departmental student union, graduate caucus, or constituency group.

[31]            The respondents submit that FP‑1(3) effected a change, in that after January 18, 2006, resignations only needed to be reported, not ratified, at the subsequent meeting of Forum.

[32]            The petitioners submit that FP‑1(3) did not eliminate the ratification requirement, and they say minutes of subsequent meetings show that the practice of ratifying resignations continued.

[33]            The evidence on this point is ambiguous.  The Minutes of the February 15, 2006, Forum meeting shows that there was a motion to ratify the resignations of eight members.  The petitioners say that this supports their position.  However, the roll call for that same meeting does not list any of those eight resigned members, either in the list of members present or in the list of members absent.  This would seem to support the respondents’ position that the resignation of those eight former members took effect before the meeting began.

[34]            The Minutes of the July 19, 2006 Forum meeting states that "The chair informed Forum that Director Lennon has resigned."  The Minutes of that meeting show no resolution ratifying the resignation.

[35]            I conclude that Forum Policy FP‑1(3) has the effect that, whatever may have been the previous practice, after January 18, 2006, it was not necessary for resignations from Forum to be ratified before they became effective.  If there were to be a requirement for ratification, FP‑1(3) would have used the word "ratified" rather than "reported."  If there were a continuing requirement for ratification, then to say that there was also a requirement to report the resignations would be meaningless.

[36]            On the evidence before me, two persons who had been members of Forum at the end of the July meeting submitted their resignations prior to the September 27 meeting.  The Agenda prepared in advance of the meeting listed Jackie Hiew and Menolly Lysne as "resigned."  The Minutes of the September 27 meeting do not list them in the roll call.  I am satisfied that their resignation was effective prior to the start of the September 27 meeting.  Accordingly, the quorum necessary for the September 27 meeting was a majority of the 28 Forum members.  Fifteen of those members were present at the start of the meeting.  That number constituted a quorum.

Section 85

[37]            The petitioners' request for relief depended on the arguments that the September 27 meeting was invalid because of lack of notice and because it lacked a quorum.  I have concluded that neither of those arguments can succeed.  I find that the meeting proceeded without the alleged infringements of the Act and the Bylaws. 

[38]            While it is therefore unnecessary for me to apply the curative powers vested in the court in s. 85 of the Society Act, I should add that if I had found a procedural irregularity with respect to the events leading up to the special general meeting, I would have rectified those irregularities and validated the special general meeting. 

[39]            In my view, the evidence discloses that the petitioners were using every strategy they could devise in order to frustrate the attempts to have a special general meeting convened.  This is clearly shown by the facts recited in the affidavit of one of the directors, Andrea Sandau, sworn November 23, 2006.  At para. 15 she deposes:

15.       On 8 September 2006, I attended a private meeting with some of the other Board Members.  To the best of my recollection, Shawn Hunsdale, Glyn Lewis, Margo Dunnet, Marion Pollock, Wei Li, Vanessa Kelly, Caitlyn Hawkes‑Frost, and Augustine Cerani were present.  By that time we were aware that the Dissatisfied Members were circulating a Petition asking for a Special General Meeting to consider the removal of the Seven Directors.  Shawn Hunsdale, who was then the President of the Society and one of the Seven Directors, acknowledged that he would likely be receiving the Petition the following week, noted that, as President, he would be required to call a Special General Meeting, and suggested a number of ways in which the Board could prevent the Special General Meeting from succeeding.  Although I do not recall his actual words, I recall that he made the following suggestions: 

(a)        He suggested that the Board could take the position that he was not required to convene the Special General Meeting unless the petition was signed by 10% of the members as set out in the Society Act, instead of the 5% required under Bylaw 10(7)(b).

(b)        He suggested that if a Special General Meeting was convened, the Board could schedule the Annual General Meeting for the same time and date, which would probably result in fewer students attending the Special General Meeting, making it more difficult to achieve a quorum.  On 29 September 2006, two days after the Special General Meeting was called by Forum, the Board called its Annual General Meeting to be held at the same date and time as the Special General Meeting.  I was initially at the Board meeting where the date of the Annual General Meeting was approved but had to leave for work prior to the motion being discussed or passed.

(c)        He suggested that we could combine the Special General Meeting and Annual General meeting and draft the Agenda for the Annual General Meeting so that the Society would have to deal with other issues first and leave the impeachment motion to the last, in the expectation that people would leave the meeting and it would lose quorum.

(d)        He noted that any member could bring a motion at a Board meeting asking that the Board convene a Special General Meeting and suggested that we could cancel or not call Board meetings for the remainder of the semester to avoid that from happening.

(e)        He suggested that quorum for any General Meeting considering impeachment motions could be prevented by holding it in a location that was too small to hold the 500 members required for quorum, or holding it at either the Surrey or Kamloops campus of SFU, which would result in fewer members of the Society attending the meeting, and thus making it hard to achieve forum.

[40]            What is interesting about that evidence is that many of the strategies that were discussed were in fact implemented.  In particular, the board implemented the strategy of refusing to convene a special general meeting based on the petition signed by 9.8 percent of the members.  The board relied on s. 58(2) of the Society Act which provides:

58(2)    The directors of a society on the requisition of 10% or more of the voting members of the society must convene a general meeting of the society without delay.

[41]            However, Bylaw 10(7)(b) says that a general meeting must be convened on the request of only five percent of the members.  It provides:

10(7)(b)           The President shall convene a Special General Meeting within thirty calendar days of receipt of a petition signed by five percent or more of members in good standing of the Society.

[42]            There was no basis in law for the Board to ignore the requirement of Bylaw 10(7)(b).  The excuse that s. 58(2) of the Society Act called for ten percent rather than five percent was not a valid reason to ignore the requirements of the Bylaw.  There was no inconsistency between the Act and the Bylaw.  Section 58(2) of the Act does not preclude a society from enacting a Bylaw that makes it easier for members to requisition a special general meeting, and that is precisely what this Society had done.  The Board could have complied with the Bylaw without thereby violating the Act, and that shows that there was no inconsistency between the two.

[43]            Since a special general meeting should have been convened in response to the petition, I conclude that even if there had been some irregularity in the Forum meeting of September 27, it would nevertheless be appropriate to validate the special general meeting held in October pursuant to s. 85 of the Society Act.

Conclusion

[44]            The petition is accordingly dismissed.

(Submissions re costs)

[45]            THE COURT:  There will be an order for costs against the individual petitioners only, not the Society, and costs will be on scale 3.

“W.F. Ehrcke, J.”
The Honourable Mr. Justice W. F. Ehrcke