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CO-OPERATIVES - Membership - Expulsion

Wednesday, September 29, 2021 @ 6:06 AM  

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Appeal by Russell from a decision dismissing her appeal from a decision of the board of directors of the respondent housing co-operative terminating her membership and from the dismissal of her claim for relief from forfeiture. The appellant’s membership in the respondent was terminated for non-payment of housing charges. At the Board meeting, she explained her absence from work due to illness and proposed a plan to repay the arrears. The appellant delivered a bank draft for $1,397.50 to the respondent the next day. The appellant argued the principles of natural justice were not followed and that the respondent failed to consider multiple relevant facts, including COVID‑19 orders and required isolation. The chambers judge found that the appellant could not establish any breach of the principles of natural justice and concluded that it was not open to her to substitute her decision for that of the Board. She rejected the appellant’s claim for relief from forfeiture on the basis that the legislative framework in the Cooperative Association Act governing termination was a complete code and that termination of membership amounted to a statutory forfeiture from which equitable relief was not available.

HELD: Appeal allowed. The judge erred in concluding that she could not substitute her decision for that of the Board. She was required under s.37(3)(b)(ii) of the Act to consider whether the decision to terminate the appellant’s membership was reasonably supported by the facts. The court was given broad powers to hear new evidence, make findings of fact, and arrive at a different conclusion on the issue of the termination of membership. Reading ss.37(3) and 37(5) together, it was clear that a court could restore membership and grant an order of possession in favour of a member where the principles of natural justice were not followed, where the decision of the co-operative was not reasonably supported by the facts, or where the rules for termination adopted by the co-operative were not followed. The appellant’s claim for relief from forfeiture was properly rejected. The Act established a comprehensive scheme intended to govern appeals by a member of a housing co-operative who had their membership terminated. Relief from forfeiture was excluded by the language and scheme of the Act. The legislature signalled its intent to have the appeal procedures limited to those set out in s.37 of the Act, based on the grounds enumerated in s. 37(3)(b).

Russell v. Craigflower Housing Cooperative, [2021] B.C.J. No. 1933, British Columbia Court of Appeal, A.W. MacKenzie, B. Fisher and G.B. Butler JJ.A., September 7, 2021. Digest No. TLD-September272021005