Woloshyn v. Association of United Ukrainian Canadians, 2013 ABQB 262

Court of Queen ’ s Bench of Alberta Citation: Woloshyn v. Association of United Ukrainian Canadians, 2013 ABQB 262 Date: 20130502 Docket: 1201 10297 Registry: Calgary Between: Tony Russel Woloshyn Applicant - and - Association of United Ukrainian Canadians Respondent _______________________________________________________ Reasons for Judgment of the Honourable Madam Justice C.A.

Kent _______________________________________________________ [ 1 ] The Association of United Ukrainian Canadians (the association), founded almost 100 years ago, is an association that provides cultural, educational, recreational and social communion to its members. There are branches of the association across Canada. The association has real estate holdings across Canada, including a camp at Sylvan Lake, Alberta (the camp). Membership of the association has dwindled and a large portion of its membership is over 60.

In January, 2012, the National Committee of the association decided to list the camp for sale and it is on the market now for $3 million. A group of members from Calgary opposes the committee ’ s decision to sell the camp before the National Convention to be held in October, 2013. Mr. Woloshyn is one of those members. Mr. Woloshyn brings this application for judicial review of the National Committee ’ s decision to sell the camp at this time. He applies either to have the decision declared a nullity or for an injunction against the sale of the property until the National Convention.

[2] The association has been considering its future through the Report of the Future Committee. That report was issued afterthe decision was made to sell the camp. The National Committee has decided that at the National Convention, the membership willconsider the report, including a proposal to liquidate its assets and wind up the association. [3] The association is incorporated federally as a corporation without share capital. Several of the provisions of the governingbylaws are relevant to this application. The association is governed by a National Committee and the National Executive Committee.

The members of National Executive Committee are elected at the National Convention. The National Committee is comprised of theNational Executive Committee members and additional members determined by the National Convention. [4]

Article 10 of the bylaws provides that all property of the association is held in common for the common benefit of theassociation as a whole. Control of the assets is vested in the National Committee which, "...at any meeting summoned to deal with suchquestions, shall have the full authority to sell or dispose of any asset of the Association...for such price or upon such terms as the NationalCommittee, from time to time, may decided. (Article 10(2)).

Article 10(3) provides that before liquidating an asset valued at more than$10,000, the National Committee "...shall notify any affected branches, committees, and other interested parties and invite them to makewritten submissions regarding the proposed disposal to the National Committee. A motion to dispose of such assets shall be tabled for aminimum of 30 calendar days and until the next meeting of the National Committee to allow consideration of any submissions receivedprior to the vote on the motions. [5]

Article 11 provides that any member of a committee or the executive shall not be a part of discussions or decisions on anymatter in which they have a material interest; material interest being defined as matters of employment, salary and benefits of individuals,business contracts, honoraria and grants or disciplinary matters. [6]

Article 9 sets out an appeal process. Article 9(1) to (11) deals with appeals of decisions from bodies in the association otherthan the National Executive Committee, the National Committee or the National Convention.

Article 9(12) provides that a "...decisionof the National Executive Committee may be appealed to the National Committee in the same manner as an appeal to the NationalExecutive Committee as prescribed in Article 9(1) to (9)" and Article 9(13) provides that a decision of the National Committee may beappealed to a National Convention in the same manner as an appeal to the National Executive Committee as prescribed in Articles 9(1)to (6). [7] The National Committee tabled a motion to sell the camp on May 14, 2012. The committee sent letters as required byArticle 10 advising of the intention to sell the camp.

On June 18, 2012, counsel for Mr. Woloshyn provided the National Committeewith written submissions and evidence with respect to the proposed sale. The National Committee received other submissions, somesupporting and some opposing the sale. On June 23, 2012 the National Committee approved the motion to sell the camp. On June 29,2012, counsel for Mr. Woloshyn and 49 other members informed the National Committee and the National Executive Committee oftheir intention to appeal the decision. [8] The camp is a 6 acre parcel of land on the shore of Sylvan Lake.

Over the years, the camp has been used for dance classes, asummer camp for children and various other activities. There are several trailer pads that are rented out each summer. About 36 peopleincluding Mr. Woloshyn use the camping facilities at the camp. [9] There are three questions I must answer. First, is the decision of the National Committee subject to judicial review? If it is,then did the National Committee violate its constitution. If there was a violation, what is the remedy? Is the decision to sell the camp subject to judicial review? [10] Mr.

Woloshyn argues that this case fits squarely within those cases that the courts have found are amenable tojudicial review. In Lakeside Colony of Hutterian Bretren v. Hofer, (SCC), [1992] 3 SCR 165, members of an Hutteritecolony had been ordered by the colony to vacate the property.

The court held that courts should be slow to exercise jurisdiction over thequestion of membership in a voluntary association but that "...the courts have exercised jurisdiction where a property or civil right turnson the question of membership" (para 6), where either property and contractual rights are affected, the court may intervene (para 8), andthat whether it is a property or contractual right, the question is whether it is "...of sufficient importance to deserve the intervention of the

court and whether the remedy sought is susceptible of enforcement by the court"(para 9). [11] In Schenk v. Bayshore Village Assn., 2001 CarswellOnt 3440, the Ontario Superior Court found that the owners whoboth owned a lot adjacent to a lake and were members of the association had a property interest in the docking facilities such that thecourt was prepared to review a bylaw passed by the association. The docking facilities were owned by the association, but the courtfound that it was owned on behalf of the members of the association. In Knox v.

Conservative Party of Canada, 2007 ABCA 295 thecourt found that a decision regarding the nomination of a candidate was not subject to the public law remedy of judicial review. In Lee v.Yeung, 2012 ABQB 40, members of the board of directors of the Photographic Arts Society of Alberta applied for an order setting asidean election of the board of directors. The court found that it was entitled to review the election.

In so doing, it said the following aboutLakeside at para 52: While the Hutterian Brethren case did involve individual and property rights of the aggrieved members, courts will intervene in theprivate activities of non-statutory bodies where the aggrieved parties have no other remedy available to them. In such cases, judicialintervention is not only appropriate but can be expected. [12] In Mayan v. World Professional Chuckwagon Association, 2011 ABQB 140, Mayan’s membership in theassociation was suspended because a hearing panel found him guilty of abusive behaviour. He sought judicial review of that decision.

Because the association abandoned the argument that the decision was not amenable to judicial review, the court only briefly consideredthe issue of whether it did have jurisdiction. However, that brief review summarizes of the state of the law: The courts will be slow to interfere with the decision of a voluntary, private tribunal. In general, the courts have intervened at least incases where the tribunal’s decision could detrimentally affect a member’s employment, or where the tribunal has acted withoutjurisdiction, breached natural justice or made a decision that is patently unreasonable.

The supervisory jurisdiction of the court does notextend, however, to determining whether the tribunal/s decision was right or wrong in substance. (para 25) [13] I would add to that

summary three things. First, private bodies are not amenable to the public law remedy of judicialreview, but private law remedies are available, including setting aside an invalid decision or action (Kaplan v. Canadian Institute ofActuaries, (AB KB), [1994] A.J. 868, aff’d 1997 ABCA 310 , [1997]A.J. 874, leave to appeal refused,[1997] SCCA 563. Second, if there is a property or civil right affected, it is the importance of the right at stake, rather than itscharacterization, that determines whether the court takes jurisdiction (University of Victoria Student’s Society v.

Canadian Federation ofStudents 2011 BCSC 122). Third, some cases have interpreted the scope of the court’s jurisdiction limited to issues of membership(Pestell et al. Kitchener-Waterloo Real Estate Board Inc. et al. (1982), (ON SC), 34 OR (2d) 476). [14] Mr. Woloshyn agrees that this is not a case for public law judicial review. Rather I can review the decision to determinewhether it complied with the by-laws. If it did not, then the decision is a nullity. Mr. Woloshyn does not assert a property interest, butrather a significant interest as a member of the association. [15] In arguing his case, Mr.

Woloshyn makes two submissions about the facts. First, the camp has not been a financial burden onthe association. Mr. Woloshyn and others who use the trailer pads contribute volunteer labour to do renovations. Second, Mr.Woloshyn submits that it should not matter how much the camp was being used, but whether it is well used by the members in a waythat is consistent with the objects of the association. Moreover, it is unique. There is something special about going to the same camp asyour grandfather. [16] Mr.

Woloshyn says that review of the decisions of private associations is not limited to questions of membership asis asserted by the association. It relies on the statement in the University of Victoria case that it is not the characterization of the rightthat is key, but rather the importance of the right at stake. As well, the members had an interest in the property as did the owners inSchenk. [17] The association says that the important fact is that the camp is used by 36 people on 16 trailer pads. Noone other than thepeople from Calgary use the camp.

Any other activities such as the dance training can be done elsewhere. There is nothing uniqueabout the camp. The association says that Mr. Woloshyn ’s interest here does not compare with the interests in Lakeside where thefamily was expelled from the colony or University of Victoria where the membership at issue was mandatory, not voluntary and there

was a significant amount of money at stake. It also argues that Mr. Woloshyn is really asking me to replace the association’s decision to sell with my decision. [ 18 ] Since Mr. Woloshyn agrees that there is no property interest at stake, I must look at what other interest there may be and whether the effect of the association’s decision on that interest is of sufficient importance that it merits judicial intervention. That, I think, is the proper reading of Lakeside . I do not agree that Lakeside limits judicial intervention to cases involving a property interest or membership. Here, as in all associations, Mr.

Woloshyn has become a member because he has sufficient interest in the objectives of the association and the association has accepted him into its membership. There can be a range of interests that could be created by that relationship. Some may of sufficient importance that judicial intervention is appropriate. [ 19 ] Before deciding this issue, for reasons that will become apparent, I move on to the three alleged violations of the by-laws. Two can be dealt with reasonably summarily. Mr. Woloshyn says that members of the National Committee had a conflict of interest and should not have voted.

The conflict arises because the members received honoraria or expenses or both. The argument is that revenue from the sale of the camp may go to pay those amounts. First, two votes were taken, the second one excluding the two members of the committee who receive honoraria. That left only those whose expenses were paid. Expenses only reimburse for moneys paid out. There is no financial interest that would cause a conflict. [ 20 ] The second alleged violation is that the decision was made without regard to the common benefit of the association.

More specifically, the Constitution sets out 4 aims and objects which must be considered in a decision to sell the camp. It is argued that the committee decided to sell even though the camp was in use. Moreover, the committee apparently was willing to sell the property for any amount of money offered. The evidence is that until October when the National Convention occurs, there will be sufficient funds to keep the association running without requiring the use of the sale proceeds.

As well, the association did not consider alternatives such as mortgaging the property or selling a more lucrative property in Ontario. By citing these reasons, Mr. Woloshyn is asking me to do precisely what I should not do which is to substitute my judgement for the judgement of the committee. Whether it made sense to sell the camp as opposed to another property or whether selling the camp when the small number of people who used the camp were opposed are all legitimate considerations for the committee. I may agree or disagree, but that is not within the scope of this review.

As was stated in Lakeside and confirmed in Boucher v. Metis Nation of Alberta Assn. [2009]AJ No. 4 (ABCA) , I am limited to determining if there is a breach of internal rules, lack of procedural fairness or bad faith. There is nothing in the evidence for me to conclude that the committee did not consider the aims and objects of the association in its deliberations. [ 21 ] The third violation is more complex. Mr. Woloshyn says that he has a right to appeal the decision of the committee to the National Convention. That cannot occur until October.

He refers to article 9(13) which, he argues, is plain and gives a right of appeal from a decision of the National Committee to the National Convention. [ 22 ] The association says that decisions about the sale of property are excluded from Article 9(13) by virtue of the wording of Article 10(2) which gives control of the assets to the National Committee and give the Committee "...full authority to sell or dispose of any asset of the Association, pursuant to Article 10(1), for such price and upon such terms as the National Committee, from time to time, may decide". It also argues that a careful reading of

Article 9 in conjunction with other Articles shows that not all decisions may be appealed. Articles 12 and 13 begin with the words ‘a decision’, not ‘any decision’. That means that only decisions where an appeal is specifically available may be appealed. Decisions that may be appealed are a membership application decision (Article 2(13)), a decision to dissolve a branch (Article 4(17)), or an interim decision to suspend or discontinue membership (Article 12(7)). It is helpful to my decision to look at the wording of the three articles referred to.

Article 2 (13) says that people involved in the membership decision "may appeal any membership application or transfer decision by following the appeal process as set out in

Article 9". Article 4(17) says that a decision to dissolve a branch "shall not be implemented until all appeals as provided for in

Article 9 have been considered or the time limitations for requesting an appeal have expired". Article 12 (7) says "[t]he accused and the complainant shall have the right of appeal as set out in

Article 9. Finally, the association argues that if Mr. Woloshyn is correct, then a decision to sell an asset like a truck, so long as it is valued at more than $10,000, could be held in abeyance for 3 years awaiting an appeal to the National Convention. [ 23 ] There is nothing in any of the articles where the right of appeal is specifically mentioned that indicates that the right of appeal is limited to those matters nor is there anything in either Articles 9 or 10 that limits the right of appeal when the sale of property is involved. All

Article 10 does is to identify who has authority to sell property. For these reasons,

Article 9 permits an appeal to the National Convention in this case. Mr. Woloshyn is entitled to appeal to the Convention. [ 24 ] That takes me back to the issue of whether this is a reviewable decision. As indicated above, one of the tests is whether the question is of sufficient importance. The measure of importance must be objective. Otherwise all a person would need to do is say that an issue is important to him or her. On an objective scale the sale of the camp is certainly not of the same importance as employment as in

Mayan or livelihood as in Lakeside . It is on the border of those decisions which ought to be taken up by the court. That said, the denial of Mr. Woloshyn’s right of appeal falls within the category of cases where the tribunal has been unfair in denying Mr. Woloshyn an appeal. This case is reviewable. [ 25 ] As for remedy, it would not be appropriate to declare the decision a nullity. The breach committed was not waiting until the appeal to the National Convention was heard. The decision may be upheld by the Convention. That is for the delegates to decide. [ 26 ] The appropriate remedy is to grant an injunction.

There is an issue between the parties about whether an injunction would be permanent or interlocutory. In my view, the injunction is permanent in the sense that it remains in place until the appeal is heard. Not to grant the injunction which in turn risks the camp being sold would make Mr. Woloshyn’s remedy moot. [ 27 ] There will be an injunction, enjoining the association from selling the camp until the appeal is heard and decided. Heard on the 5 h day of April, 2013. Dated at the City of Calgary, Alberta this 2 nd day of May, 2013. C.A. Kent J.C.Q.B.A. Appearances: Joshua D. Fraese for Mr.

Woloshyn Clayton Cook for the Respondent