Posts tagged Canadian Federation of Students

CFS BC branch fails to prevent opponent at Kwantlen from filling director’s seat

The Canadian Federation of Students (CFS), the national student advocacy group, was again the unsuccessful party in a court judgment earlier this month, but this time it was one of the CFS’ provincial arms, a BC society called the Canadian Federation of Students – British Columbia Component (CFS-BC), that was in the docket.

The decision of the BC Court of Appeal in Kwantlen University College Student Association v. Canadian Federation of Students – British Columbia Component (CanLII) serves as another installment in the campaign brewing from several years now on many campuses against the CFS, where students and student organization are arguing that the CFS is not justifying its existence and their memberships should cease.  See here (Aldergrove Star) for local news covering the judgment.   

The fundamental legal issue in this case involved the decision of the directors of CFS-BC to deny a seat on the board to a representative of a member student organization who participated in a campaign to have the Kwantlen University College Student Association (KSA) withdraw its membership.  The KSA brought the matter to court to force their representative to have a place at the table, winning in the BC Supreme Court and Court of Appeal. 

The arguments in the dispute, like most of those in cases dealing with student organizations, involve the laws of societies, also known as non-profit corporations, which in this province are governed by the Society Act (BC Laws).  All registered societies in British Columbia must adhere to certain requirements, among them being that the members of each society must elect or appoint the society’s directors.  Where a society has failed to conduct its affairs consistent with this statute or the society’s bylaws or constitution, members have a remedy under the following provision of the Society Act:

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

the court may

(d)        … 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.

Most societies, when confronted by a legal claim involving section 85, argue that the court should not interfere with these sorts of internal affairs, as if they are beyond the interest or purpose of the civil court system.  In this case, the court had the following response:

[32]           Section 85 of the Society Act specifically contemplates the courts making orders to ensure that the rights of society members under the society’s bylaws are not transgressed.  Where the matter brought before the court is an issue of the construction of provisions of the bylaws that define the fundamental rights of members in respect of the society’s operations, it is clear that the court has jurisdiction to intervene, and need not defer to the bylaw interpretations espoused by the society.

[33]           In this case, what is at issue is the right of the KSA to have a representative on the CFS-BC’s governing body.  It goes to the heart of the relationship between the CFS-BC and its members.  It is a question of the jurisdiction of the CFS-BC’s Executive Committee, and lies within the courts’ mandate under s. 85 of the Society Act.  Accordingly, we do not agree with the CFS-BC’s assertion that deference is due to it on the interpretation of the bylaws in issue in this case.  [Emphasis added.]

The specific portion of the CFS-BC bylaws that court was asked to interpret involved the manner in which directors are elected by members and what say, if any, the other directors have over that appointment process.  The court highlighted the following rule:

Societies may, in their bylaws, set out different schemes for the selection of directors.  Directors need not be elected in accordance with the voting rights of society members under s. 7.  Different schemes may be in place for filling the various positions on the board of directors.  Some directors may be selected by particular parts of the society’s membership, and it is not necessary that each member have a precisely equal say in the selection of directors:  Lee v. Lee’s Benevolent Assoc. of Canada, 2004 BCCA 168 (CanLII), 2004 BCCA 168, 42 B.L.R. (3d) 182.  What is essential, however, is that directors be selected in a manner set out in the society’s bylaws, which must place the selection of directors in the hands of members of the society.   [Emphasis added.]

The CFS, including its provincial arms, has been in court an awful lot over the past year, dealing with fallout from withdrawal campaigns, such as in the case of the KSA and the University of Victoria Students’ Society (CanLII), and disputes with student organizations about payment of dues, such as in the case of the Simon Fraser Student Society (CanLII).  Less than two weeks ago, the Concordia Student Union (CSU) commenced an action against the CFS regarding both a withdrawal campaign and payment of dues. 

We’ll see where things stand for the CFS when the dust settles.

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UVSS triumphs over CFS in dispute over petition to withdraw membership

The University of Victoria Students’ Society celebrated (UVSS Chairperson’s Blog) last week’s decision (CanLII) of the Supreme Court of British Columbia overturning the decision of the National Executive of Canadian Federation of Students to decline to accept the petition of a student at the University of Victoria calling for a referendum at the school about continued membership.  Leaving aside the political issues, this case is interesting because it shows that the essential legal matter related to student representation has to do with procedure and the laws of societies.

As a brief background, all undergraduate students at UVIC, like the person behind the petition, are automatically members of the UVSS, a registered not-for-profit corporation or “society” under the Society Act (BCLaws).  The CFS is a national post-secondary student lobbying organization consisting of post-secondary student societies, including the UVSS.  Legally, the CFS is a registered society under the Canada Corporations Act (Department of Justice).  Since student organizations are distinct legal entities that act for social and not profit-driven purposes, they use the legal structure of a society, incorporating either under federal or provincial legislation.  This lets them own property, make contracts, have employees, and so on – just like regular corporations – but there are no shareholders (only “members”) and nothing that can be bought or sold like shares reflecting any ownership position.  Societies, either federal or provincial, are often confused with “registered charities” – that is, organizations registered with the Canada Revenue Agency and empowered to issue tax receipts for donations – but those are separate statuses.

Within the structure of the CFS, associations like the UVSS are “voting members” and the students within those associations, like the student behind the petition, are “individual members”.  Individual members pay an annual fee to their association, which passes the funds on to the CFS.  Students can’t opt out of membership in the CFS; this has to happen collectively by popular vote or referendum to end an association’s membership.

The story in this case is that while the student behind the petition was busy getting signatures, a separate group of students was preparing another petition effectively with the opposite purpose – to avoid any question about continued membership in the CFS.  This second petition played a significant role in the CFS deciding to reject the main petition.  The court, in this case, was asked to interpret the bylaws of CFS and decide whether the National Executive was able to decline to accept the main petition. 

Conventionally, courts don’t touch disputes dealing with internal affairs of private organizations. Here’s what courts generally consider when deciding whether to intervene:

  • the potential for courts to be clogged with disputes about the internal business of voluntary organizations (see Street v. B.C. School Sports [CanLII]);
  • whether the dispute deals with the substance of an organization’s activities, or with processes of an organization’s activities (the latter the court will deal with); and
  • whether the dispute is “of sufficient importance to deserve the invention of the court and whether the remedy sought is susceptible of enforcement by the court” (see Lakeside Colony of Hutterian Brethren v. Hofer [CanLII]).

In this case, the court found it was important to intervene because “the interests at stake are sufficiently important”, pointing to, among other things, the amount of money being sent from the UVSS to the CFS in membership fees.  The court relied on the following passage from North Shore Independent School Society v. B.C. School Sports Society (CanLII) when scrutinizing the conduct of the National Executive, like any other decision-making in voluntary associations:

36        The narrow scope for judicial review of the decisions of a domestic tribunal were noted by Dohm J. in Vancouver Hockey Club Ltd. v. 8 Hockey Ventures Inc. 1987 CanLII 2461 (BC S.C.), (1987), 18 B.C.L.R. (2d) 372 (B.C. S.C.) at 375:

The review by the court of orders made by an unincorporated association such as the N.H.L. through its president and chief executive officer (a domestic tribunal as it were) is limited. The power in no way includes the right in the court to substitute its decision for that of the domestic tribunal. The court is not the court of appeal. Rather, its power is narrow and it may only interfere if the order was made without jurisdiction (or against the rules) or if it was made in bad faith or contrary to the rules of natural justice. In addition, the courts will be reluctant to interfere with the decisions of a domestic tribunal where it is shown that internal remedies have not been exhausted. And there is even greater reluctance to interfere if the decision is based upon opinions regarding the standards of propriety and conduct appropriate for members of a particular association. Dawkins v. Antrobus (1881), 17 Ch. D. 615 (C.A.); Lee v. Showmen’s Guild of Great Britain, [1952] 2 Q.B. 329, [1952] 1 All E.R. 1175 (C.A.); Harelkin v. Univ. Of Regina, 1979 CanLII 18 (S.C.C.), [1979] 2 S.C.R. 561, [1979] 3 W.W.R. 676, 96 D.L.R. (3d) 14, 26 N.R. 364 (Sask.]. These well-known principles provide the foundation for the court’s review.

37        These cases show that the courts are prepared to interfere with the decision of a domestic tribunal where it can be shown that the tribunal exceeded its jurisdiction or failed to comply with the rules of natural justice or otherwise acted in bad faith. What these cases also demonstrate is the reluctance of the courts to intervene by substituting the court’s judgment for the judgment of the tribunal on a matter of substance within the tribunal’s jurisdiction.

The court found against the CFS, arguing that it had no basis for considering the second petition in deciding whether to accept the main petition.

The important lesson to draw from this one: student organizations, particularly ones with lots of student power or money, should be very cautious to follow their own procedures and any other legal requirements, particularly rules of good faith and natural justice.  Whether any student actually has the time or money to sue them is a different matter.

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