Member Disciplinary Proceedings: What Do the Courts Consider to be “Fair”?

Bains v. Khalsa Diwan Society of Abbotsford, 2021 BCCA 159 is a recent case from the BC Court of Appeal (“BCCA”) that addresses various issues that may arise in member disciplinary proceedings and provides helpful guidance for non-profit boards conducting, and making decisions in, member disciplinary proceedings.

Background

The Khalsa Diwan Society of Abbotsford (the “Society”) is a religious organization that has nearly 8500 voting members. The Society’s bylaws provide for “general members” and “voting members”. In this case, a voting member is someone who has accepted the bylaws, has paid a membership fee and is eligible to vote and participate in the Society’s annual or special general meetings.

The Society held its AGM in April 2018 and there was an altercation between members in which security personnel stepped in and the AGM was forced to be cancelled. The Executive of the Society shortly thereafter, decided by special resolution to initiate expulsion proceedings against 12 members of the Society pursuant to their bylaws. Following written communications between the Executive and the 18 members, the Society decided to suspend 1 member and expel 11 members from the Society. They also later decided to ban 7 members from the Society’s premises.\

Decision

In the BC Supreme Court (“BCSC”) decision, the chambers judge found that the Society failed in providing procedural fairness to the members that were suspended and expelled and concluded that the Society’s decision included a reasonable apprehension of bias. The chambers judge ordered that the expulsions, suspensions and/or bans be set aside and that those members suspended and expelled be reinstated.

The BCCA partially overturned the BCSC decision and found that the Society satisfied the procedural fairness required of them for the suspension and expulsion of the respondents as voting members, but confirmed that the Society did not satisfy the procedural fairness requirements in their decision to ban 7 members from the Society’s premises as they remained general members and retained the right to attend the premises following their expulsion as voting members.

Takeaways

In their decision, the BCCA highlighted the relevant principles of procedural fairness for societies. The BCCA noted that the proceedings in this case were not civil or criminal in nature, were not proceedings before a statutory body, were not regulatory proceedings and were not proceedings that engaged the interests of property or the livelihood of the respondents. As a result, the procedural fairness requirements in these proceedings were of a lesser degree.

The following points were highlighted by the BCCA regarding procedural fairness and suspension or
expulsion proceedings:

1) The BCCA confirmed the requirements for adequate notice for discipline and expulsion as required under the Societies Act and the principles of natural justice, which include:

a. Timely notice of the meeting or hearing where a member’s conduct is to be discussed. In this case, several weeks was found to be sufficient.
b. The notice must identify that the member’s expulsion is at issue. In this case, the notice made it clear that the hearings would consider expulsion or suspension of the member receiving the notice.
c. The notice should contain some description of the factual basis pertaining to the behavior or conduct in question. In the context of proceedings of a society, a lower degree of particularity may be appropriate. In this case, the notice was found to contain sufficient detail to allow the respondents to understand the concerns about their conduct.

2) The BCCA overturned the trial judge’s finding that there was bias on the part of the Executive of the Society, and noted that there are often practical realities that constrain the issue of bias in societies, particularly:

a. The decision maker has often had contact with the issue in question;
b. The decision maker often has a degree of interest in the outcome of the issue; and
c. Bylaws or rules of associated often identify decision makers without any alternative procedure.

As a result, the BCCA reiterated the following principles for a finding of bias:

a. A personal interest will disqualify an individual from adjudicating disciplinary proceedings if they are motivated by a personal interest and are themselves the driving force advocating for discipline.
b. The bylaws of a society may authorize some degree of bias through prescribing overlapping roles of individuals in the society. If an individual simply acts pursuant to their overlapping roles prescribed in the bylaws, this does not automatically result in a finding of bias.

3) While the BCCA found that the Society properly followed the requirements of procedural fairness in the respondent’s expulsion as voting members, the Society did not follow the requirements of procedural fairness in their bylaws to expel them as general members.

Particularly, the Society failed to do the following:

a. The Society did not make clear that the expulsion of the respondents included their expulsion as general members of the Society.
b. The Society did not provide the respondents with notice or an opportunity to respond prior to advising those members that they were banned from the premises.

As a result, since the respondents continued to be general members of the Society and the Society did not follow the requirements of procedural fairness for their ban from the premises, they were found by the BCCA to be entitled to continue attending the premises.

Conclusion

Overall, this case is a helpful reminder of the following for societies in relation to member disciplinary
proceedings:

1) The importance of reviewing the bylaws for conducting disciplinary proceedings to ensure that the procedure in the bylaws is properly followed and that the appropriate adjudicator(s) are assessing the case.
2) The importance of affording any member subject to disciplinary proceedings notice of the reasons for expulsion and an opportunity to be heard, as required by the principles of natural justice.
3) The importance of a society being aware of the issue of bias and ensuring that none of the adjudicators in a member disciplinary proceeding are motivated by a personal interest beyond their interest as a director and/or member of the society.
4) The importance of a society understanding the different levels of membership in their bylaws and the rights and privileges they afford. For example, if there are two tiers of membership (as in this case) to ensure that disciplinary proceeding cover the intended levels of membership.

If you have any questions or would like further information on this topic, please contact one of our lawyers.

Disclaimer: The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

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