Alberta Soccer Association v. Charpentier, 2011 ABQB 3

Court of Queen ’ s Bench of Alberta Citation: Alberta Soccer Association v.

Charpentier, 2011 ABQB 3 Date: 20110106 Docket: 1003 11662, 1003 11792 Registry: Edmonton Between: Docket: 1003 11662 Alberta Soccer Association, Chris Billings, Shauna Aab, Danny Bowie, Les Hodges, and Mike Troke Plaintiffs (Respondents) - and - Mario Charpentier, Christine Chater, Jeff Du Berger, Robert Hayne, Colin Innes, Chris Jossy, and Fred Kern Defendants (Applicants) - and - Between: Docket: 1003 11792 Sunny South District Soccer Association, Edmonton District Soccer Association and Central Alberta Soccer Association Applicants - and - Alberta Soccer Association and Alberta Soccer Association as represented by the purported Board of Directors, Mario Charpentier, Jeff Du Berger, Fred Kern, Colin Innes, Robert Hayne, Christine Chater, and Chris Jossy ( “ Board No. 1 ” ) - and - Alberta Soccer Association as represented by the purported Board of Directors, Chris Billings, Danny Bowie, Mike Troke, Les Hodges and Shauna Aab ( “ Board No. 2 ” ) Respondents

_______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice W.A. Tilleman _______________________________________________________ Introduction [ 1 ] The dispute between the Alberta Soccer Association (“ASA”) first came before me in the summer of 2010. Alberta Soccer Association v. Charpentier , 2010 ABQB 715 .

I characterized that dispute by saying this at para. 1: This case involves an unfortunate fracturing of a provincial sports society, resulting not only in the paralysis of the governing Board but also the consequence of uncertainty in the games and activities of some 80,000 members who joined for the joy and happiness of participation in amateur sport.

For a variety of reasons, the leadership of the Alberta Soccer Association has been unable to get along in 2010, grinding the Association and the happiness of the soccer players to a halt. [ 2 ] I concluded my reasons for judgment at para. 65 which sets out my remaining jurisdiction: Under the ASA bylaws, an Annual General Meeting must be convened before the end of January, 2011. At that time, the membership of the ASA will have an opportunity to elect a Board and put this unfortunate period of uncertainty behind them.

In view of the brief period of time between the date of this judgment and the next Annual General Meeting, I would hope and indeed expect that the Board will conduct itself judiciously, mindful of the fractured state of the Association and sensitive to the antipathies that these proceedings have provoked amongst its 80,000 members that deserve better.

In the event that difficulties arise out of the calling of the next Annual General Meeting, or the conduct of the ASA in this interim period, or should the January 10, 2010 Board wish me to rule on the ASA being wound-up immediately, the parties are directed to bring the matter back to me. [ 3 ] The matter came back in front of me on December 15 th , 2010, by way of an application filed by the Defendants in the 1003- 11662 action. That application was to request, inter alia , the following: [1] An Order that: ... (

b) The Alberta Soccer Association (the "ASA") Annual General Meeting be rescheduled to be held not later than the last day of June 2011; (

c) In the alternative, waiving the necessity of the presentation of the ASA's budget or its audited financial statements at the January 2011 Annual General Meeting; ... (

g) Providing advice and directions regarding the Special General Meeting being the subject matter of the petition attached as Exhibit 2 to the Affidavit of Colin Innes, dated December 13 th , 2010; (

h) Providing advice respecting the winding up of the ASA [ 4 ] The grounds for making the application were, inter alia , that difficulties arose at the time of my Order in November. The alleged difficulties included that the ASA auditors could not complete their work until the New Year.

[5] Among other things, the new application was precipitated by the inability of the current Board to function, as well as for advice on winding up and issues relating to a petition of the members of the ASA for a Special General Meeting (“SGM”).[2] [6] Three main requests were put to me by the Defendants in the 1003-1162 action and the “Board No. 1" Respondents in the1003-11792 action (collectively the “Marshall Clients”).

First, they want me to postpone the planned Annual General Meeting (“AGM”) “scheduled for January 21st, 2011” or alternatively to waive the necessity of presenting the financial and other budgeting documents at the AGM, The requirement for financial documentation to be provided at the AGM is stipulated in the Bylaws.[3] Second, they wantadvice and direction from the court regarding the SGM.

Third, the Marshall Clients also seek advice from the court on the winding up ofthe ASA, notwithstanding that their counsel states that winding up is premature which is curious as it was included as a remedy soughtpursuant to his amended application found in

section 1(h). [7] The application by the Marshall Clients is supported by Mr.

Innes’ Affidavit that essentially states the ASA cannot meet thestatutory deadlines not only under the Bylaws but also under sections 25 and 26(2) of the Societies Act R.S.A. 2000, c.S-14, regarding thefiling of those documents at the AGM. [8] The Marshall Clients recommend postponing the AGM as the ASA members should have the full advantage of seeing thecompleted documents at the AGM, and because of the advantages of a “cooling off period” for the Board members still locked inturmoil. [9] For legal authority to make these decisions, I am directed to the Court’s adherent jurisdiction including sections 5 and 8 ofthe Judicature Act R.S.A. 2000 c.J-2, because there is no other adequate remedy at law.

Additionally, I am referred to two cases, the firstbeing Somali Islamic Society of Canada v. Hussan, 2007 O.J. No. 5609 and Seong v. Korean Canadian Cultural Association ofMetropolitan Toronto, [2007] O.J. No. 893. The latter two cases establish at least for Ontario, the Superior Court’s jurisdiction to delay the Annual General Meetings in the hopes that outstanding issues may be resolved.[4] See also for jurisdiction, In R v. Stelco Inc., (ON CA), 2005 O.J. No. 1171 (Ont.

C/A). [10] As it relates to the petition for the SGM delivered to the Board of Directors on December 6th, 2010 the court is informed thatmuch of the business sought to be transacted is the same as that contemplated by the decision rendered last month in Alberta SoccerAssociation v. Charpentier, supra. However, all counsel informed me the proper number of signatures were on the SGM petition andthus the requirements of section 8(2) of the Bylaws had been met for it to proceed.

Further to that, it was conceded that while there was some overlap between the SGM petition and its issues caught by my decision of November 17th, the overlap was not perfect. There issome concern that if the SGM proceeds, it will end up in a disciplinary hearing or inquiry into the conduct of certain members of theBoard. [11] As it further relates to the winding up, the Marshall Clients felt it necessary to file additional materials relating to three things: - solvency of the Corporation; - the willingness of a Liquidator to assist; and - the evidence that the Society is dysfunctional.[5] Response of Mr.

Wakefield, Acting on Behalf of Sunny South District Soccer Association, Edmonton District Soccer Associationand Central Alberta Soccer Association [12] Mr. Wakefield, counsel for the Applicants in the 1003-11792 action (the “Wakefield Clients”), tells me that other soccermembers wish to retain him but were afraid of retribution by the Canadian Soccer Association. I am not seized in that particular newmatter and it will be dealt with by other Justices of this court in due course.

[ 13 ] Counsel for the Wakefield Clients wanted additional time to file Affidavits and he suggested the winding up be adjourned because the court needed to deal with the pressing issue of the AGM and the SGM. They did want the AGM to go ahead because it was already planned for January 21 st , 2011, in Calgary.

Furthermore, as for the incomplete financial statements, they informed the court that in the past the audited financial statements or budgets were not always presented at AGMs anyway, meaning there should be some flexibility. [ 14 ] In short, the Wakefield Clients felt that the AGM could go ahead as planned and that financial statements and draft budgets could be submitted as audited and drafted.

This should not hold up the AGM. [ 15 ] Regarding the SGM he, like all Counsel who appeared in front of me on December 15 th , 2010, believe the SGM and AGM could be held concurrently on January 21 st , 2011, because there is some overlap. He did not feel that pushing the AGM off until June, 2011 would solve anything because the current Board would continue to act in the face of what he referred to as a Board member revolt.

In short, he felt that there need not be a decision yet on winding up, that the AGM could go ahead as planned, and that the requirements for formal financial statements and finalized budgets could be loosened.

Response of Chris Billings, Shauna Aab, Danny Bowie, Les hodges and Mike Troke and the Alberta Soccer Association as presented by the purported Board of Directors, Chris Billing, Danny Bowie, Mike Troke, Les Hodges and Shauna Aab (“Board No. 2") [ 16 ] Counsel for the Alberta Soccer Association, Chris Billings, Shauna Aab, Danny Bowie, Les Hodges, and Mike Troke and Alberta Soccer Association, Chris Billings, Danny Bowie, Mike Troke, Les Hodges and Shauna Aab (“Board No. 2”), (collectively the “Forster Clients”) did not feel that there was enough time to get full comments on the application filed by the Defendants in the 1003- 1162 action, and thus urged me to ensure that there was a broader distribution of this application before me to final decision.

That said, counsel for the Forster Clients also pointed out, and corroborated information given to me by counsel for the Wakefield Clients that, subsequent to my decision of November 17 th , 2010, the Board that I reinstated had acted to either fire or suspend employees. I would not receive this information as evidence at the time because it was unsworn. Now it is sworn. [6] [ 17 ] Mr. Forster also agreed with Mr.

Wakefield that the winding up should be deferred. [ 18 ] All parties agreed, or at least had some sympathy, with the following three points: - that the court should streamline procedures or, if possible, limit future court proceedings; this helping all parties to limit the escalating costs of litigation; - all parties were favorable to somehow extending the SGM such that it coincided with the AGM, with a caveat that Mr.

Marshall’s clients still preferred the AGM be bumped towards next summer; and - that broader notice of the December 15 th , 2010 application should be given to all affected members of the Alberta Soccer Association. My Procedural Direction on December 15 th , 2010 [ 19 ] Following the hearing and submissions by counsel, I can conclude the ASA is getting closer to winding-up, and that issue is in front of the Court as per the recent application filed by Mr. Marshall. [ 20 ] Accordingly, on December 15 th , 2010, I ordered as follows:

1) As it relates to Mr. Wakefield’s pending applications for judicial review of the Canadian Soccer Association’s decisions regarding ASA members, I decided that I was not seized with any jurisdiction. My ongoing jurisdiction was limited by para. 65 of the November 17 th decision and had nothing to do with the matter presented for judicial review of the Canadian Soccer Association’s threats or decisions. 2) As it relates to the December 15 th application, I reserved my decision pending further submissions to be filed once notice was given to other ASA representatives. 3) That notice (of the application filed by Mr. Marshall) was to be presented to the members as defined by

section 4 of the ASA Bylaws and posted on the ASA website. 4) The deadline for comments by any party vis a vis that application was December 22 nd , 2010. 5) I promised the parties to deliver my decision on December 31 st , 2010. [ 21 ] This is that decision. Submissions Received on December 22 nd , 2010 [ 22 ] Submissions came in on December 22 nd , 2010, by several parties. They include several affidavits – some of which are lengthy – and for that reason I do not wish to set out the

summary. I will, however, reference them in my decision below and I do want counsel to know I hae read these submissions. Analysis and Decision Special General Meeting [ 23 ] While the court may have an inherent jurisdiction to change the SGM, I pointed out on December 15 th my reluctance to become involved with the SGM, or any meeting that had been properly noticed up and called pursuant to the By-Law by participants. In the case in front of me, there were two applications, in the form of petitions, for a SGM.

The first, which is attached to the Affidavit of Colin Innes [7] , was delivered to the Board of Directors on December 6 th , 2010, and requested the following resolutions: 1. that the SGM be chaired by an independent and professional individual; 2. to remove Mario Charpentier from the office of First Vice President for good and sufficient cause under Article 19(1)(iii) of the Bylaws; 3. to remove Jeff DuBerger from the office of Second Vice President for good and sufficient cause under Article 19(1)(iii) of the Bylaws; 4. to remove Fred Kern from the office of Past President for good and sufficient cause under Article 19(1)(iii) of the Bylaws;

5. to remove Colin Innes from the office of Director of Finance for good and sufficient cause under Article 19(1)(iii) of the Bylaws; 6. to remove Robert Hayne from the office of Director at Large for good and sufficient cause under Article 19(1)(iii) of the Bylaws; 7. to remove Christine Chater from the office of Director at Large for good and sufficient under Article 19(1)(iii) of the Bylaws; 8. to remove Chris Jossy from the office of Director at Large for good and sufficient cause under Article 19(1)(iii) of the Bylaws; 9. to amend the Bylaws of the Association to add

Article 34: 34. A Director of the Association is not permitted to be a Director or Officer of any Active member or Associate member of the ASA.

Within 30 days of a person being elected or appointed to the ASA Board) that person must resign from any director or officer position of any Active or Associate member failing which the Director will be terminated from the ASA Board. l0. to amend Rule 1 by the addition of: xvi) No incumbent Officer/Director of a District Association shall be eligible for nomination or appointment to the Association Board. [ 24 ] The SGM Application also provided grounds for the proposed resolutions #2 to #8, on the basis that each of the Directors named, either individually or collectively: · Acted to suspend the President of the Association without any authority to do so under the Bylaws; · Acted to suspend the President of the Association from all soccer related activities without complying with the Bylaws) the Regulations of the Association or the duty of fairness; · Purported to conduct the business of the Association without any authority to do so under the Bylaws; · Purported to pass resolutions of the Board without complying with the requirement in the bylaws that all members of the Board receive notice of Board meetings and be given the opportunity to attend meetings of the Board or to participate in votes of the Board; · Dismissed the Executive Director of the Association without a lawful resolution made at a properly constituted meeting of the Board of the Association; · Usurped the powers of the Members and the powers of the Association by suspending the President without engaging the members; · Attended the CSA 2010 AGM and voting against the Reform package without first determining the membership position on this issue; · Refused to attend the SGM called by the members on April 24 th , 2010; · Refused to call the SGM called by the members in the petition served by the Edmonton District Soccer Association on behalf of many members; · Wrongfully dismissed staff of the Association thereby causing unnecessary financial liabilities for the Association; · Purported to suspend Sunny South District Soccer Association, Edmonton District Soccer Association and Central Alberta Soccer Association and their associated teams ; · Purported to cancel tier IV youth provincials and withhold medals from youth players that earned a medal through competition · Conducted themselves in a manner that caused Association to be brought into disrepute; and,

· Such other matters as may be brought to the attention of the Members before the SGM and that in the opinion of the Members constitute good and sufficient cause. [ 25 ] The second petition for an SGM, was attached to the December 22 nd , 2010 affidavit of Mary Krys and requested the same resolutions as the first petition (above).

However, the second petition provided different grounds for resolutions #2 and #8, with the reasoning being as follows: Each of the Directors, either individually or collectively: - Have failed to manage the affairs of soccer in Alberta in such a way as to maintain a positive working relationship with its members.

The members no longer have confidence that the current board will be able to move Alberta Soccer out of its current morass. [ 26 ] Both petitions having been properly noticed up under section 8(2) of the Alberta Soccer Association Bylaws, means that the SGM will go ahead as planned; the court has nothing to do with that. My only restriction, and this is a matter of process only, is to direct the SGM to be held on January 21 st , 2011. It makes no sense to have two SGMs go ahead, two weeks apart.

Accordingly, the SGM will be held by the ASA on January 21 st , 2011. [ 27 ] At the December 15 th hearing all counsel present were in agreement that the SGM be chaired by someone independent of the ASA Board. That made respectable sense. I would suggest that the independent chair be picked by the counsel who were before me on December 15 th . I have confidence these counsel will find the proper name with the main criteria being independence. The Annual General Meeting [ 28 ] I have decided to exercise the court’s jurisdiction and direct that the AGM be deferred according to the following schedule: 1.

The ASA AGM be rescheduled to be held not later than the last day of April, 2011. 2. The ASA shall deliver a copy of its 2011 budget and its 2010 audited financial statement to its Members as soon as those documents are prepared, and no later than the last day of March, 2011. 3. The ASA shall deliver a copy of this Order and its Annual Report under the Societies Act to the Registrar on or before the last day of February, 2011, without its 2010 audited financial statements if they are not prepared by that date. 4.

The ASA shall deliver a copy of its 2010 audited financial statement to the Registrar as soon as it is prepared, and no later than April 15th, 2011. 5. All of which is subject to further Order of this Court. The Winding Up [ 29 ] On December 15 th , 2010, the parties suggested that the winding up is premature notwithstanding the application brought by the Defendants in the 1003-1162 action in December included the request for the court’s advice regarding the winding up of the Alberta Soccer Association.

Since then, and based on the sworn evidence received last week, I do not think the winding up is necessarily premature.

[ 30 ] However, inasmuch as the SGM will be going ahead on January 21 st , 2011, and that the agenda of that SGM will include the matter of the membership of the Board of Directors (see e.g., Bowie affidavit, 12/22/10, para.16), and considering the merits in postponing significant issues found in financial statements such as litigation costs, and the new budget pending the conclusion of that SGM vote, I find that the application to wind up, if it does become necessary, is deferred and pending the SGM on January 21 st , 2011, with whatever results that important meeting may have for the Board’s new structure if there is one. [ 31 ] Whatever else the Board of Directors of the Alberta Soccer Association has done over the past year, it appears not to have taught the soccer players the principles of cooperation and respect for each other.

I agree with this evidence: The current Court proceedings are only the latest example of the disputes, many of them bitter, which have occurred within the ASA for decades. Generally speaking, the situation is as follows. When there is a dispute at the level of the ASA Board of Directors, or a dispute between the Board of Directors and one or more of the member organizations, many of the member organizations take sides in the dispute, as do many of the soccer parents. Accusations of serious wrongdoing are flung back and forth.

People make judgments based on what they have heard, when they have not heard all of the facts. All of this, besides damaging the reputation of the ASA beyond repair, provides a terrible role model for the children who play soccer. If the adults cannot follow the rules, work out their differences and get along, how can they expect the children to do so? [ 32 ] As for the winding up, if a new board of directors is elected at the SGM there is some hope with new people, the winding up will not be necessary.

Regardless, if a winding up is necessary I direct the parties to come back in front of me as early as possible in February 2011, to end the ASA as it now stands, along with the explicit admission of failure defined by such an event at the hands of those who were placed in a position to avoid it. Heard on the 15 th day of December, 2010. Dated at Calgary, Alberta this 31 st day of December, 2010. W. A. Tilleman J.C.Q.B.A. Appearances: Donald R. Cranston, Q.C. and Nigel J. Forster of Bennett Jones LLP for the Plaintiffs in 1003 11662 and “Board No. 2” Respondents in 1003 11792 J. Barrie Marshall, Q.C., James T.

Ryan and Taryn C. Burnett of Gowling Lafleur Henderson LLP for the Defendants in 1003 11662 and “Board No. 1” Respondents in 1003 11792 Kim Wakefield, Q.C. and Hendrik Kruger of Fraser Milner Casgrain LLP for the Applicants in 1003 11792

Kate L. Hurlburt and Jonathon L. Westcott of Emery Jamieson LLP for the Interested Parties, Calgary Minor Soccer Association and Edmonton Minor Soccer Association [1] Amended Application by the Defendants*** [2] Exhibit “2" to the Affidavit of Colin Innes, and brought to the attention of Mr. Marshall’s clients on December 6 th , 2010. [3] Bylaws Article 17(4) [4] See e.g.

Somali Islamic Society at para.5. [5] I point out that given the litigation and disputes of 2010, little further evidence would be needed to establish that particular point. [6] Affidavit of Danny Bowie filed on December 22, 2010 at paras. 24-25. [7] Exhibit 2 to the Affidavit of Malcolm Colin Innes filed December 13 th , 2010