Court victory for local society

CYNTHIA RAMSAY

Members of the local Jewish community have won a victory in the B.C. Supreme Court in a years-long battle with B’nai Brith Canada (BBC). This dispute was about control of the Lions Gate B’nai B’rith Building Society, which provides affordable housing for Jewish seniors in Vancouver.

On Oct. 28, the Hon. Justice John Sigurdson delivered his Reasons for Judgment in Lions Gate B’nai B’rith Building Society v. B’nai Brith Canada et al., which was heard in the Supreme Court of British Columbia on Sept. 12-13.

Counsel for the petitioner (the society) was Ronald Josephson. David F. Sutherland was counsel for the respondents, who were B’nai Brith Canada, Sid Alperstein, Ariane Eckardt, Ziggy Eckardt, Grigori Khaskin, Jack Chivo, Nora Ayanian, Roy Grinshpan, Alex Kivritsky, Eva Derton, C. Rochelle Moss, Vera Nickel, Harvey Berenbaum, John Yohana Cerny, Constance Kivritsky, Jeff Polo, Audrey Unickow, Mel Unickow, Shelly Unickow-Polo, Gabriel Patrich and Dan Levinson.

The lawsuit that was the subject of this Supreme Court decision goes back as far as 2009, when a dispute arose over the membership in the society. There were two factions, one made up of longtime members of the society and the other made up of people recruited to join the society by B’nai Brith Canada, which became involved in the region in 2007 when B’nai B’rith International transferred its administration of the Lions Gate Lodge in the then-called Evergreen Region to B’nai Brith Canada. It was when BBC set to revitalize the local lodge, membership in which was necessary to be a member of the society, that disagreement arose.

In 2009, both sides – longtime members of the society and those recruited by BBC – set out to have annual general meetings of the society, but each had different definitions of how a person became a member of the society. One faction held a meeting that purported to amend the bylaws of the society to resolve the issue. However, in January 2010, Sigurdson ruled that that meeting was a nullity and encouraged the sides to mediate to resolve the membership issue. In the meantime, the judge appointed an interim board made up of three people from each faction. They agreed upon an independent chairman, Ron Rozen.

The mediation effort was not successful, so the parties went back to court. At the subsequent hearing in February 2011, Sigurdson directed that any dispute over who were members of the society would be resolved by Rozen, in his capacity as chair of the interim board. As it turned out, the dispute over who were the members of the society boiled down to who were the “honorary members” of the society as defined in the bylaws. In particular, the question before Sigurdson revolved around the definition of one category of “honorary member,” namely: “Those members of the B’nai Brith Senior Citizens Housing Committee from time to time residing in B’nai Brith District Grand Lodge #4.”

The importance of that definition is that a member of the B’nai Brith Senior Citizens Housing Committee residing in B’nai Brith District Grand Lodge #4 is entitled to sit as an honorary member on the board of directors of the society, if he or she has signed a written consent to act as a director.

On May 18, 2011, Anita Bromberg, the national director of legal affairs of B’nai Brith Canada, sent Rozen the names of nine people who B’nai Brith Canada claimed were “honorary members” of the society. After consulting with a lawyer, Rozen responded to Bromberg’s e-mail and advised her that it was his decision that the nine individuals did not qualify as honorary members of the society. The court found that he did so because he felt that neither the nine individuals nor B’nai Brith Canada had provided the information that he had requested that showed that any of them had been active members of the Senior Citizens Housing Committee in 2009 or 2010 or in 2011. Rozen said in an affidavit:

“In the absence of that critically important information to enable me to make the determination that some or all of the nine individuals were indeed qualified as honorary members of the society, and after consultation with ... a lawyer ... I made the determination that none of the nine individuals was in fact an honorary member of the society.”

On May 31, 2011, the annual general meeting of the society was held at the Jewish Community Centre of Greater Vancouver. In the course of the normal process at the AGM, there was the election of the directors of the society. After the election, the board of directors comprised 10 members. The seven members of the society who were duly elected to the board were local Jewish community members Leah Deslauriers, Guy Seeklus, Josh Carr, Danny Stern, Serge Haber, Brian Jacobson and Alex Zbar. In addition, there were three honorary directors of the board: Eric Bissell, Frank Dimant and Pearl Gladman, all three officers of B’nai Brith Canada who live and work in Toronto.

Before, during and after the AGM, B’nai Brith Canada suggested that the board of directors of the society was comprised of an additional number of honorary directors (either nine or 20) who, according to Bromberg and Joe Bogoroch, past president of B’nai Brith Canada, were members of the B’nai Brith Senior Citizens Housing Committee and lived in British Columbia.

The main issue at the recent court hearing was whether that claim by B’nai Brith Canada (namely that there were additional members of the B’nai Brith Senior Citizens Housing Committee who were entitled to sit on the board of the society) was valid. In his decision, Sigurdson found that it had not been proven that these additional members, who were the respondents to the petition, were active members of the B’nai Brith Senior Citizens Housing Committee. Therefore, he held in effect that they were not eligible to be directors of the board of the society.

The following are excerpts from Sigurdson’s Reasons for Judgment, which can be found in its entirety at courts.gov.bc.ca/jdb-txt/SC/11/14/2011BCSC1450.htm.

In the introduction to his Reasons for Judgment, Sigurdson writes:

“[1] This is the latest chapter in a continuing dispute over the control of the Lions Gate B’nai B’rith Building Society. The issue to be resolved in this decision has to do with the composition of the board of directors following the society’s annual general meeting of May 31, 2011.

“[2] The bylaws provide that the board will be made up of seven members elected annually by the members at the annual general meeting, as well as certain people who are honorary members who have signed written consents to act as directors.

“[3] Under the bylaws, the president and executive vice-president of the Supreme Lodge of B’nai Brith, and the national chairman of the Senior Citizens Housing Committee residing in B’nai Brith District Grand Lodge #4, are honorary members of the society.

“[4] There is no dispute that, at the meeting on May 31, 2011, there were seven board members elected and, in addition, three members were entitled to be on the board by reason of their positions as president and executive vice-president of the Supreme Lodge and as national chairman of the Senior Citizens Housing Committee. That, however, is where the common ground ends.

“[5] The question is whether certain people are entitled to be directors because they are honorary members as defined by Clause 1(b)(iv) (of the bylaws).”

In his Reasons for Judgment, the judge lays out the position of the two sides:

“[14] The question is whether some or all of the people alleged to be members of the Senior Citizens Housing Committee are entitled to sit on the board.

“[15] Mr. Josephson’s position is that the board is comprised of the seven elected members plus the three undisputed honorary members, and that I should make a declaration to that effect. He argues that the order that any dispute over membership was to be resolved by Mr. Ron Rozen, the neutral chair, or his designate, is binding on the parties. Mr. Josephson argues that my direction was clear, that Mr. Rozen, as the neutral chair, had authority to decide this question in the case of a dispute, that there was no appeal of my decision and that, as a result, the chairman’s decision is binding and, in any event, even if not, his decision is correct.

“[16] Mr. Josephson says that, although members of the Senior Citizens Housing Committee were entitled to be on the board, Mr. Rozen’s determination that there was no satisfactory evidence that any of the alleged members were members of that housing committee was correct. Moreover, he says Mr. Rozen’s decision was reached after a fair, even-handed process under which B’nai Brith Canada was given ample opportunity to provide adequate evidence of their appointment of these people to current positions on the Senior Citizens Housing Committee.

“[17] Moreover, Mr. Josephson argues that people claiming membership on the board as honorary members because they say that they are Senior Citizens Housing Committee members, have not demonstrated that they are also residing in Grand Lodge No. 4 (whatever that might mean), and that they have not, except in a few cases, filed the requisite consents to be members of the board.

“[18] Mr. Sutherland, who represents the challenged board members, the faction supporting B’nai Brith Canada, disagrees. His position is that the constitution of the society is a contract among the members, and the issue is its proper interpretation, not a question of democratic rights. He says that the underlying theme of the constitution is that the society is an entity controlled by B’nai Brith Canada and that the appointment of people to the Senior Citizens Housing Committee (and, therefore, to the board) is a matter for B’nai Brith, and not a question for the chair. He says that Mr. Rozen went beyond his authority and assessed the quality of the evidence concerning membership in the Senior Citizens Housing Committee and, hence, the board. Mr. Rozen ought to have simply accepted, as he suggests the court should, that

B’nai Brith had (before the annual general meeting, if not much before) appointed several people to the Senior Citizens Housing Committee who were, by virtue of this appointment, entitled to be on the board.”

At the end of his Reasons for Judgment, Sigurdson concludes:

“[72] Mr. Rozen decided, fairly I think, and in a reasonable time period with respect to the annual general meeting, that the submitted people were not members of the Senior Citizens Housing Committee. B’nai Brith has the right to appoint members to the Senior Citizens Housing Committee, the only question is whether, at the time, the persons submitted were members who had agreed to serve as directors.

“[73] If they had been, that would have been a relatively simple matter for Mr. Sutherland’s client to establish. Mr. Rozen’s decision was a reasonable one. It implied an interpretation that in order to be directors, the members had to be current active members of the Senior Citizens Housing Committee.

“[74] If I thought, as Mr. Sutherland suggests, that Mr. Rozen was assessing the suitability of persons nominated by B’nai Brith to be on the board as honorary members, I would not confirm his conclusion, but, in my view, he did not do that.

“[75] Accordingly, in my view, the proper declaration is that the board is made up of the slate elected from Mr. Josephson’s clients’ faction and the three honorary members.”

Sigurdson’s reasons continue:

“[77] Under the bylaws, apart from the elected directors, people are entitled to be directors if they are members of Senior Citizens Housing Committee, have filed a written consent and are residing in B’nai Brith Grand Lodge #4.

“[78] Who are ‘those members of the B’nai Brith Senior Citizens Housing Committee from time to time residing in the B’nai Brith District Grand Lodge #4’ who have filed consents?

“[79] Mr. Josephson says that there is no adequate evidence on any of the three requirements.

“[80] I start with the first point: the person must be residing in the B’nai Brith District Grand Lodge #4. Mr. Sutherland says that this is resolved by Mr. Frank Dimant’s affidavit, where he says, ‘[t]he buildings associated with the society were always identified as B’nai Brith structures within B’nai B’rith International under the jurisdiction of District 4, Evergreen Region, and now part of B’nai Brith Canada.’

“[81] It was not made clear to me whether District 4 Evergreen Region was the same as B’nai Brith District Grand Lodge #4.

“[82] The evidence in support of membership in the housing committee is sparse. I did not understand B’nai Brith to say that they had the right simply to appoint directors of the society, rather they said persons could become directors if B’nai Brith first appointed them to the committee. The bylaws, properly interpreted, mean that, in order to be directors, those persons had to be active members of the committee. The evidence falls short of showing that. Accordingly, I find that Mr. Rozen’s conclusion was correct.”

Sigurdson concludes:

“[83] I make the declaration sought by Mr. Josephson that the board of the society is made up of the seven elected directors and the three honorary members.”

Josephson, counsel for the society, was pleased with the decision. “The democratic process that lies at the heart of the governance of societies like the one in question has prevailed,” he told the Jewish Independent. “The attempt on the part of B’nai Brith Canada to have a large number of individuals (ranging from between nine and 20) appointed to the board as honorary directors would, if successful, have had the effect of disempowering the seven members of the board of directors who were elected by the members of the society. That would have been an unjust result. The decision of Mr. Justice Sigurdson has the effect of affirming the decision of the members of the society made at the annual general meeting in May 2011, which is, in my view, a good thing.

“In coming to that conclusion,” continued Josephson, “Mr. Justice Sigurdson found that it required more than simply B’nai Brith Canada saying that certain people were active members of the B’nai Brith Senior Citizens Housing Committee. It was necessary for B’nai Brith Canada to provide sufficient evidence to support that claim. Mr. Justice Sigurdson found, on all of the material before him, that B’nai Brith Canada had failed to provide that evidence.”

The Jewish Independent contacted Sutherland, counsel for the respondents, for comment but he was unable to do so before press time. B’nai Brith Canada has 30 days from when the Reasons of Judgment were issued to file an appeal against Sigurdson’s decision.

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