Date:
20090722
Docket:
T-394-09
Citation:
2009 FC 741
Ottawa, Ontario, July 22, 2009
PRESENT: The
Honourable Madam Justice Tremblay-Lamer
BETWEEN:
COUNCILLOR YVONNE BASIL, COUNCILLOR MARY JUNE COUTLEE,
COUNCILLOR STUART
JACKSON,
FORMER COUNCILLOR
SHANNON KILROY,
FORMER COUNCILLOR
LORNE SAHARA,
COUNCILLOR AARON
SAM, and COUNCILLOR CLYDE SAM
Applicants
and
CHIEF
DONALD CYRIL MOSES,
THE
ELDERS’ INVESTIGATIVE COMMITTEE
PURPORTEDLY
OF THE LOWER NICOLA INDIAN BAND, and
THE
COUNCIL OF THE LOWER NICOLA INDIAN BAND
Respondents
REASONS FOR JUDGMENT AND JUDGMENT
[1]
This is an application for the judicial review
of the following decisions, brought pursuant to s. 18.1 of the Federal
Courts Act, R.S.C. 1985, c. F-7 (the Federal Courts Act), as amended
on April 15, 2009:
T-394-09
(1) A
decision by Chief Donald Cyril Moses (Chief Moses) that
after November 28, 2008, Lower Nicola Indian Band (LNIB) administration would
pay the expenses of the Elders Investigation Committee (EIC), believed to be
about $60,000, out of LNIB funds, without the expense being approved by Lower
Nicola Indian Band Council (the Council); and
(2) A
decision by Chief Moses dated February 27, 2009 whereby Chief Moses determined Councillors
Mary June Coutlee, Stuart Jackson, and Clyde Sam were impeached, accepted
resignations from each, and expressed an intention to call a by-election as a
result.
T-601-09
(1) A
LNIB Band Council Resolution dated March 16, 2009 addressing the
holding of a by-election to fill three vacancies on Council given the February
27, 2009 EIC report impeaching Councillors Sam, Coutlee, and Jackson, all three
sitting on Council at the time of the EIC report;
(2) A LNIB Band Council Resolution dated March 16,
2009 stripping impeached Councillors Sam, Coutlee, and
Jackson, all three sitting on Council at the time of the EIC report, of their
honoraria and other privileges; and
(3) A LNIB Band Council Resolution dated March 16,
2009 authorizing the of spending $10,000 in legal fees to the
law firm of Blake, Cassels & Graydon LLP of Vancouver to, among other
things, enforce the EIC’s February 27, 2009 decision to impeach Councillors
Sam, Coutlee, and Jackson, all three sitting on Council at the time of the EIC
report.
T-602-09
(1) A
decision of the EIC dated February 27, 2009 to impeach Councillors Sam, Coutlee, and Jackson, and others, to declare them ineligible
for future election, and to direct that a by-election be held.
[2]
Previously, on March 10, 2009, the Applicants filed a motion for an
interim injunction seeking their reinstatement as Councillors until a final
determination could be made. The result of this motion was a consent order
entered into by all parties, whereby the impeached Councillors were reinstated
and allowed to function as Councillors, subject to a number of provisions,
including, inter alia, that the Applicants not use their position as LNIB
Councillors to interfere with the EIC process or the matters before the Court.
[3]
Federal Court files T-394-09, T-601-09, and T-602-09 are separate Federal
Court matters; however, by consent order dated May 6, 2009, my colleague
Justice Eleanor Dawson, the case management judge in this matter, ordered that
the three files be heard over the same period. The files have not been
consolidated into one matter; however, given the interrelated nature of the
facts pertaining to the three files, Justice Dawson, by direction dated June 1,
2009, allowed for each party to submit one motion record covering all three files.
BACKGROUND
FACTS
[4]
The LNIB is made of about 1,050 members, and is
governed by a chief and seven elected Councillors, with elections taking place
every three years.
[5]
From October 2004 to October 2007, the chief was
Chief Arthur Dick, and the Councillors were Mary June Coutlee, Stuart Jackson,
Harold Joe, Shannon Kilroy, Lorne Sahara, Clyde Sam, and Robert Sterling.
[6]
From October 2007 to October 2010, following a
January 2008 by-election, the Chief is Chief Moses (who has held the position
of Chief or Councillor for about 24 of the last 35 years), and the Councillors
are Yvonne Basil, Mary June Coutlee, Stuart Jackson, Connie Joe, Harold Joe,
Aaron Sam, and Clyde Sam. No challenge was made to the four re-elections of
Mary June Coutlee, Stuart Jackson, Harold Joe, and Clyde Sam.
[7]
The LNIB is a custom or non-section 74 band,
meaning s. 74 of the Indian Act, R.S., 1985, c. I-5 (Indian Act) does not apply, and it uses its own Custom
Election Rules to select its Chief and Council.
[8]
During the September 2007 election campaign, on
September 24, 2007, the LNIB held a general band meeting at which the LNIB’s
financial statements for the fiscal year ending March 31, 2007 were presented
to the community. At the meeting, LNIB’s auditor raised monetary concerns, to the
effect that the then Chief and several Councillors had received during the
term, from LNIB, payments in excess of their honoraria. The auditor, according
to the minutes of the meeting, described this “other remuneration for the Chief
and Council” in excess of honoraria as “this could be a wage or money that has
been earned by means of a contract.”
[9]
Councillors receive honoraria of about $15,600
annually. Councillors are, pursuant to the Custom Election Rules, prohibited
from serving concurrently as employees of the LNIB and are, pursuant to the Lower
Nicola Indian Band Chief and Council Policy and Guidelines (LNIB Chief and Council
Policy and Guidelines), barred from entering into professional service
contracts with the LNIB of over two months or over $5,000, unless the LNIB
membership approves the contract at a band general meeting.
[10]
At the meeting, it was asked whether there is
information supporting the amounts received by the Chief and Council, to which
the auditor, as reported in the minutes, replied there is, and it “can be found
in the accounting department because every time a cheque is made to a person
then a record is made of payments received and from which department is paying
for that service.”
[11]
The minutes of the September 24, 2007 meeting
state that “it is pointed out that the new Council should look at and to [sic]
decide on what they are going to do about this breach of the election by laws.”
The orator of this statement is unknown. Chief Moses on cross-examination
stated he did not recall who said this, and specifically could not recall
whether he had said this. Those present at the meeting and therefore the
possible orators were Chief Moses and four elders, Madeline Lanaro, Maggie
Shuter, Gloria Moses, and George Coutlee. There were no motions made or passed
at this meeting concerning the breach of election by-laws.
[12]
Subsequent to this meeting, Chief Moses
initiated a process for reviewing the receipt of funds by Chief Arthur Dick and
the seven Councillors serving the October 2004 to October 2007 term in
question.
[13]
Chief Moses formed the EIC by extending an
invitation to all elders, meaning community members aged 60 and over, to
participate in the EIC, after which time the elders themselves selected EIC
members. Elders are recognized under the Custom Election Rules as those who
hear and determine appeals from band elections. Elders also play an important
role in the customary governance structure of the LNIB by providing counsel and
advice to Chiefs and Councillors.
[14]
Eighteen of the 115 elders invited responded,
and of those, five were selected to form the EIC. Chief Moses provided the EIC
with a mandate and Terms of Reference at the EIC’s first meeting.
[15]
Four of the five elders selected were present at
the September 24, 2007 meeting at which the LNIB’s auditor raised the
monetary concerns.
[16]
Chief Moses did not place a motion to form and
fund the EIC before the Council or general LNIB membership. Councillor Basil
believes the cost of the EIC to be $60,000.
[17]
Chief Moses determined that the Council was
unable to consider the matter of forming and funding the EIC due to
conflicts of interest, given of the seven Councillors sitting during the
October 2007 to October 2010 term, four Councillors had served on the
previous term’s Council, and one, although new to Council, was the son of a Councillor
from the previous term. Two Councillors would not have had any conflicts of
interest.
[18]
Chief Moses found unilateral authority to form
and fund the EIC on the basis of first, the September 24, 2007 minutes stating
“[…] the new Council should look at and decide on what they are going to do
about this breach of the election by laws,” and second, the authority granted
via the LNIB Chief and Council Policy and Guidelines at s. 23(e) for good band
governance, which sets out the authority to “make decisions when required on
behalf of Council when such decisions are necessary for good government.” Chief
Moses indicated he has a responsibility for good band governance, collectively
the Chief and Councillors have a duty to honour and respect the Oath of Office,
and members of the previous Council are alleged to have violated their Oath of
Office, which requires action.
[19]
The Oath of Office sworn by the 2004 to 2007
Council included the following:
3. We will not allow our business or personal affairs to
influence our decision-making and we will always consider the best interests of
the Community;
4. We will uphold the laws of the Band as approved by the Band
Council and as learned from general meetings and at large from Band Members,
Elders and Youth;
5. We will strive to preserve and enhance our culture and
heritage and strive to maintain a proper place for our Band Members in society;
6. We will resign from our elected position whenever we have
been found to be in contravention of the Band’s election rules and Chief and
Council Policy & Procedures or of this oath of office.
[20]
Council, not accepting the unilateral acts of
Chief Moses, passed Motion #5 on October 14, 2008, indicating its
non-acceptance of the EIC in the following terms: “that the ‘investigation’
stop as of October 14, 2008, and that no further expenditures be made on this
exercise until it’s discussed at a special meeting of council, or at the next
band general meeting October 27, 2008.” The EIC has not been discussed at a
special Council meeting or at a general LNIB meeting, save for Motion #5.
[21]
By memorandum dated October 30, 2008, Chief
Moses advised Council that he considered the October 14, 2008 motion to be
invalid, since two Councillors who voted for it were in his opinion in a
conflict of interest, given the investigation the motion purported to halt
directly implicated them as members of the previous Council. He further stated
that this matter would be decided on using the authority he held as Chief to
make decisions related to the good government of the LNIB, since four sitting Councillors
were in a direct conflict as they were being investigated, and one was in a
personal conflict as the son of a Councillor being investigated. He advised
Council that he intended to proceed with the investigation.
[22]
At a Council meeting on November 4, 2008, the
Applicant Councillors purported to pass a motion terminating the authority of
Chief Moses under s. 23(e) of the LNIB Chief and Council Policy and Guidelines,
so as to terminate the EIC investigation. Chief Moses responded that the
November 4, 2008 motion was invalid since the Councillors passing it were in a
conflict of interest since they were the subjects of the investigation they
were trying to quash.
[23]
On November 10, 2008, five Councillors authored
a letter indicating their refusal to recognize the EIC.
[24]
On December 9, 2008, Chief Moses began an action
for judicial review in the Supreme Court of British Columbia seeking to, among
other things, have his decision to have the EIC investigated be declared intra
vires his authority as Chief. The action was adjourned for jurisdictional
reasons. Chief Moses sued in his name, and in the name of the LNIB, although no
motion to allow the action was put before Council. The Order made with respect
to costs stated “in the event that proceedings are initiated in the
Federal Court of Canada concerning the matters referred to in the Petition
herein, then to the greatest extent possible this Court refers to the Federal
Court of Canada the issue of costs in this proceeding.”
[25]
The EIC proceeded with its investigation,
issuing its report on February 27, 2009. The Councillors were invited to
appear before the EIC after it reached its preliminary conclusions, however
only one chose to do so.
[26]
The Terms of Reference created by Chief Moses
indicated the following: the EIC panel of ten members was to do a neutral
evaluation and fact finding, in order to make recommendations to the Chief and
Council; civil or criminal proceedings could follow the EIC review process; and
the EIC “may” present its findings to the LNIB generally and without
identifying anyone found to be in breach.
[27]
On February 23, 2009, the EIC sent its
preliminary findings to Chief Moses informing him that the EIC had found each
investigated Councillor to be in breach of fiduciary duties. The report was not
finalized at that time since the EIC had invited the Councillors to make
submissions before it for a period of 10 days, until February 25, 2009.
[28]
The same day, Chief Moses issued letters to Councillors
Jackman, Coutlee, and Sam, indicating each was suspended from their duties as Councillors
of the LNIB “for breach of [their] fiduciary duty to the Band and its
membership in the taking of over $1,000,000 in band funds during [their] term
of office, 2004-2007,” “until the release of the Final Report and Decisions of the
[EIC].” The same day Chief Moses issued a press release in the
name of the LNIB indicating that all members of the prior Council had been
found to have breached their fiduciary duties by illegally taking over $1
million in LNIB funds.
[29]
On February 24, 2009, Chief Moses wrote to the
RCMP indicating that the LNIB intended to lay criminal charges for criminal
breach of trust against the former Chief and Councillors. He also wrote that
the staff and he were “concerned that an attempt will be made by [Councillors
Jackman, Coutlee, and Sam] to take over and occupy the administration of the
[LNIB]” and “should they be successful in gaining control of the office, I fear
they will use that opportunity to wrongfully access the [LNIB’s] tax reserve
held in our accounts.” The same day he had the locks on the LNIB office changed
and by the next day security guards were posted at the LNIB office, thereby
preventing the entrance by LNIB employees and others.
[30]
The EIC published its final report February 27,
2009. Chief Moses and several members of the EIC attended a press conference
discussing the report, and the report was published on the LNIB’s website.
[31]
The EIC report states that the EIC is making
both recommendations and imposing penalties. The EIC impeached the former
Chief and all but one former Councillor with respect to the 2004 to 2007 term.
[32]
The EIC report concluded that each of the eight Councillors
of the prior Council had breached their fiduciary duties to the LNIB, and that
various Councillors had failed to observe LNIB by-laws, policies, procedures,
aided and abetted other Councillors in converting LNIB funds for their own uses,
and failed to make financial choices in the interest of the LNIB membership,
among other findings.
[33]
The EIC’s main complaint about the Councillors
concerns the supply of services by Councillors to the LNIB, either as employees
or contractors, and Councillors receiving payment for these services. The EIC
cites non-compliance with certain procedural requirements of LNIB’s by-laws and
policies to justify finding a breach of fiduciary duty. The EIC held that the
findings against each Councillor save for Councillor Joe warranted impeachment,
and that the impeached Councillors must not in the future be allowed to run for
political office, or serve as directors of any LNIB companies.
[34]
Councillor Jackson was found to have taken
employment as a school principal and then as an aboriginal rights and title officer,
both in contravention of the Custom Election Rules. Councillor Sterling was
found to have taken employment as LNIB’s aboriginal rights and title
co-ordinator, in contravention of the Custom Election Rules. Chief Dick was
found to have received compensation for haying services contrary to the Custom
Election Rules and the LNIB Chief and Council Policy and Guidelines. Councillor
Clyde received “other remuneration” related to contracts that his Council
colleagues awarded to him for heavy equipment work. Councillors Kilroy, Joe,
and Sahara received payment over their honoraria for reasons the EIC could not
determine.
[35]
On March 10, 2009, Chief Moses issued a letter
to LNIB Councillors Sam, Basil, Connie Joe, and Harold Joe stating that he had
cancelled Council meetings for a period of two weeks, and that decisions would
be made by memorandum.
[36]
Subsequently, three Band Council Resolutions
(BCRs) were prepared and passed by Chief Moses and one Councillor, his niece,
on March 16, 2009, addressing the holding of a
by-election, accepting and implementing EIC’s conclusions thereby stripping
impeached Councillors of their honoraria and other privileges, and the
authorization of spending $10,000 in legal fees to enforce the EIC’s decision.
ISSUES
1. Did the EIC have the jurisdiction to impeach
past and present members of the LNIB Council?
2. Were the Applicants afforded natural justice
and procedural fairness in the EIC process?
3. Were
the EIC’s findings reasonable?
4. Were
the three Band Council Resolutions validly passed?
5. Were
the Councillors’ resignations validly accepted?
6. Is the
Applicants’ challenge to the funding of the EIC time-barred?
STANDARD OF REVIEW
[37]
Once it is determined that
an investigation into Band Councillors is lawfully authorized, the findings of
that investigation are questions of mixed fact and law reviewable on a standard
of reasonableness; whether an investigation into Band Councillors is within the
jurisdiction of the Band, however, is reviewed on a standard of correctness (Martselos
v. Salt River Nation #195, [2008] F.C.J. No. 1053, 2008 FCA 221 (F.C.A.); Prince
v. Sucker Creek First Nation #150A, [2008] F.C.J. No. 1613, 2008 FC 1268
(F.C.)).
[38]
The EIC had to interpret
LNIB law to determine the standards Councillors should be held to, and make
complicated factual findings based on LNIB records. As such, the questions on
this application are of mixed fact and law and are reviewable on a
reasonableness standard. Breaches of procedural fairness, however, must be
reviewed on a standard of correctness (Sketchley v. Canada (Attorney General), [2005] F.C.J. No. 2056, 2005 FCA 404 (F.C.A.).
[39]
When reviewing on a standard
of reasonableness, the Court must consider, per paragraph 47 of Dunsmuir v. New Brunswick, [2008] S.C.J. No. 9, 2008 SCC 9 (S.C.C.), “whether the
decision falls within a range of possible, acceptable outcomes which are
defensible in respect of the facts and law.”
ANALYSIS
1. Did the EIC have the jurisdiction to impeach
past and present members of the LNIB Council?
[40]
The LNIB’s provisions on impeachment are set out
in s. 34 and s. 35 of the Custom Election Rules, which state the following:
34. Should a Member of Council
(a) be convicted of an
indictable offence, except those of a political nature relating to the exercise
or defense of aboriginal rights or title or be convicted of any sexual or
assault offence while in office, or
(b) should a legal
proceeding recognized by the Council find that a member of Council has misused
any Band funds or resources or has breached his fiduciary responsibilities, or
(c) fail to fulfill his
responsibilities as a member of Council for a period of more than 30 days after
having received written notice to that effect from Council, then that member of
Council may be immediately removed from office by the passing of a Band Council
Resolution to that effect and a by-election shall be called immediately
thereafter pursuant to Section 24 above.
35. For the purposes of
Section 34(b) above, the responsibilities of a member of Council shall include
but not be limited to:
(a) the swearing of an oath
of office and the signing of an agreement that he will work for the best
interests of the Band as a whole and will enforce and protect the aboriginal
rights and title of all Band members and
(b) conducting or attending
Council Meetings and special or General Band Meetings and
(c) maintaining a presence
on reserves of the Band and making himself available to address Band members’
needs and interests.
[41]
The Applicants argue that the above precursors to
impeachment have not been satisfied, and any arguments supporting impeachment
based in traditional authority must fail.
[42]
The Applicants point out that Chief Moses on
cross-examination does not say impeachment occurred pursuant to s. 34, and did
not claim unilateral authority, as a Chief, to impeach. He rather stated that
the EIC did the impeaching, and that the EIC has the authority to impeach
independent of s. 34.
[43]
The EIC report states impeachment is by reason
of violations noted “contrary to the CER [Custom Election Rules], Article 34,”
which combined with Chief Moses’ statements lead the Applicants to conclude that
impeachment is based on a hybrid of s. 34 and unwritten traditional or
customary authority. The Applicants submit there is even a conflict in the
evidence as to what the traditional authority is, as the Applicants and Chief
Moses agree Elders play the traditional role of giving advice and counsel, but
the Respondents’ Affidavits show the Elders’ inherent right to meet out
justice, with no concrete details on traditional justice.
[44]
The Respondents submit that
the EIC constitutes a “legal proceeding recognized by Council” as contemplated
by s. 34 of the Custom Election Rules. As such, it was open to Chief Moses to
rely on the EIC’s findings when impeaching the Councillors.
[45]
The term “legal proceeding”
is not defined in the Custom Election Rules but there is nothing in the rules
that disqualifies a committee made up of Elders from being considered a “legal
proceeding.”
[46]
The Respondents point to Part
I of the Custom Election Rules, which recognizes that an ad hoc
committee of Elders may play a formal investigative and decision-making role.
Sections 26 to 30 mandate the appointment of a Council of Elders to
investigate, adjudicate and issue binding decisions in respect of electoral
appeals. These sections contemplate a committee that is to be funded by LNIB
funds to independently resolve election disputes. The Respondents see this as a
codification of the Elders’ traditional and customary role within the LNIB, and
rely on the EIC’s submissions on this point.
[47]
For the Respondents, the
Elders’ important role as legal moderators within the community, and the
codification in the Custom Election Rules of the role of Elders indicates that
a council of Elders, acting as independent investigators, may be reasonably
regarded as constituting a “legal proceeding” for the purposes of considering
the impeachment of Councillors.
[48]
Further, the EIC submits it
has inherent jurisdiction, based on the customs of the LNIB, to have conducted
the investigation, imposed penalties, and made the recommendations in its
report. This jurisdiction comes from the ancient customs of the Lower Nicola
people as part of the Nlaka’pamaz Nation and the role of the Elders in the
community. If the EIC does not have the inherent jurisdiction to impeach
Councillors, the EIC submits it does have the jurisdiction to investigate
alleged Councillor misconduct, and to make recommendations to the LNIB Council
or Chief regarding that conduct.
[49]
While the Custom Election
Rules contain provisions for the “impeachment” of Councillors, these provisions
do not “cover the field” for such impeachment. There remains, particularly
within the scope of this case, a role for Elders to play in the customary governance
of the LNIB. Specifically, the EIC submits that:
a)
The Custom Elections Rules
were not intended to, nor did they, oust the customary supervisory role of
Elders in respect of Lower Nicola governance; and
b)
In the alternative, insofar
as the Custom Election Rules cover certain parts of the field regarding the
impeachment of Councillors, they do not contemplate the present unique
situation where five to eight sitting Councillors are subject to investigation
and sanction or are otherwise in a conflict of interest. In this unique
situation, the Custom Election Rules create a “gap” which is to be filled by
other customs of the Band.
[50]
The EIC highlights the
active and important role Elders play in the governance of Nlaka’pamax
communities. The customary role of Elders is said to be recognized in the Custom
Election Rules, wherein an appeal of an election result is to be referred to a
“Council of Elders.” The Council of Elders is selected by “luck of the draw”
from all LNIB members over the age of 60, and has the authority to make binding
decisions on an election appeal. The Electoral Office must implement the
decision of the Council of Elders.
[51]
The EIC notes that the Custom
Election Rules do not exhaustively set out the customs of the LNIB with regard
to their governance, as noted in the Affidavit of Victor York, but there are
explicit provisions that accept the Elders as a review body whose decisions can
have a binding effect.
[52]
It is not in dispute that it
is a LNIB custom that Elders have a role in providing advice to elected members
of the LNIB. The evidence establishes that Elders hold a customary adjudicative
role in Nlaka’pamax communities based on:
a)
the xiλixstm,
which is an ancient custom of the Lower Nicola people;
b)
the Custom Election Rules
which expressly recognize the Elders as a customary legal body that makes
binding decisions on election appeals; and
c)
the Affidavit evidence of
Joe, G. Sam, Shutter, York, and Toodlican.
[53]
In the present case, the Custom
Election Rules do not cover all matters relating to the impeachment of Councillors,
and the Elders’ customary authority to impose penalties on members of Council
remains part of the customs of the LNIB and continues to apply.
[54]
According to the EIC, there
is a gap in the Custom Election Rules because they provide that a member of
Council can be impeached in certain circumstances by the passing of a BCR.
However, the Custom Election Rules do not contemplate the circumstance where,
as here, Council is unable to pass a BCR because a quorum of Council cannot be convened
in order to deal with the matter. The EIC submits this gap may be resolved by
allowing for a reduced quorum of Council, by exercise of the Chief’s good
governance authority under the LNIB Chief and Council Policy and Guidelines, or
by applying LNIB customs that are not codified in the Custom Election Rules.
[55]
In the alternative, if the
Court finds that the Elders did not have the inherent authority to impeach Councillors,
the EIC argues that the Elders do at least have the authority to investigate matters
and make recommendations to Council or to the Chief regarding the conduct of Councillors.
The Custom Election Rules recognize that the Elders’ deliberation constitutes a
legal proceeding within the customary law of the LNIB. The EIC’s findings are thus
a legal proceeding within the custom of the LNIB.
[56]
The Respondents’ arguments supporting the
jurisdiction to impeach based on the EIC qualifying as a legal
proceeding for the purposes of s. 34 of
the Custom Election Rules must fail for the following reasons.
[57]
First, it is important to note that the EIC Terms of Reference
themselves indicate the EIC could not have envisaged itself as a legal
proceeding. Term of Reference 4 states the following:
4.
The panel will be expected to exercise their discretion in making
recommendations regarding civil, criminal, or other legal proceedings which
they feel should be undertaken to address any of the alleged breaches of LNIB
laws, Policies and Guidelines, and oaths of office.
The reference to “other legal
proceedings,” on a plain reading and in the context of the sentence in which it
appears, only makes sense if it is based on the assumption that the EIC is not
a legal proceeding itself. It would be illogical for the EIC to act as a legal
proceeding, yet at the same time use its discretion to make recommendations for
other legal proceedings.
[58]
Second, the Respondents rely
heavily on ss. 25 to 30 of the Custom Election Rules as codifying the Elders’ traditional
adjudicative role and customary ability to impeach. True, ss. 25 to 30 do
codify a Council of Elders, however only in the very specific context of
appeals of election results, and even more specifically, where there has
been “a corrupt election practice or a violation of these Rules […]” (s. 25). I
fail to see how the codification of a Council of Elders charged with adjudicating
appeals of election results, not the situation before us, can be taken to mean
a Council of Elders, acting as independent investigators, may be reasonably
regarded as constituting a “legal proceeding” for the purposes of considering
the impeachment of Councillors. Impeachment and elections appeals are two
distinct scenarios, and there may well be reasons for specifically implicating
a Council of Elders in one and not the other.
[59]
I therefore find that the EIC was not a “legal
proceeding” for the purposes of s. 34 of the Custom Election Rules.
[60]
I now turn to the EIC’s argument
that a gap exists in the Custom Election Rules because they provide that a
member of Council can be impeached in certain circumstances by the passing of a
BCR, and the Custom Election Rules do not contemplate the circumstance here
that Council is unable to pass a BCR because a quorum of council cannot be
convened.
[61]
The gap argument is tied entirely
to s. 34 of the Custom Election Rules, which states that should a Councillor
find him or herself in one of the situations mentioned in s. 34(a), (b),
or (c), that Councillor may be immediately removed from office by the
passing of a BCR to that effect. Specifically, in this situation it is tied to
s. 34(b) - should a legal proceeding recognized by Council find that a member
of Council has misused any LNIB funds or resources, or has breached his
fiduciary responsibilities, then a Councilor can be impeached by the passing of
a BCR.
[62]
The EIC’s gap argument becomes moot
given I have found that the EIC impeachment process was not a legal proceeding for
the purposes of s. 34 of the Custom Election Rules.
[63]
The Respondents’ arguments supporting
impeachment based in traditional authority must also fail.
[64]
While authority for custom bands to develop
their own Custom Election Rules extends to the removal of Chiefs and
Councillors and includes removal by impeachment (Lafond v. Muskey Lake Cree
Nation, [2008] F.C.J. No. 923, 2008 FC 726 (F.C.)), rules of
removal ought to be narrowly construed given the severity of removal (Bugle
v. Lameman, [1997] F.C.J. No. 560, 71 A.C.W.S. (3d) 417 (T.D.) at para. 2; Dene
Tha’ First Nation v. Didzena, [2005] F.C.J. No. 1561, 2005 FC 1292 (F.C.)
at para. 28). This Court has not accepted alternative provisions for
impeachment such as customary or traditional authority where a band’s Custom
Election Rules have been found to have “covered the field” (Prince, supra),
formed an “all-encompassing legal code” (Martselos v. Salt River First
Nation #195, [2008] F.C.J. No. 13, 2008 FC 8 (F.C.) at para. 32; Bugle,
supra at para. 2), or to have contained “explicit discipline procedures” (Lafond,
supra at para. 30).
[65]
I find the LNIB’s Custom Election Rules
provisions on impeachment are thorough and well-established, and satisfy the
case law so not as to allow for alternative provisions for impeachment founded
in customary authority. I am satisfied they cover the field adequately.
[66]
Further, there is no
evidence of a broad community consensus supporting the Elders’
impeachment powers. In Catholique v. Band Council of Lutsel K'e First Nation,
[2005] F.C.J. No. 1782, 2005 FC 1430 (F.C.), removal outside of the process
outlined in the band’s draft written rules was successful in the removal of a
Chief.
[67]
My colleague, Justice Richard Mosley, in Catholique, supra,
at paragraph 50 found that the
band’s custom included the “practice of removal of a Chief and Councillors from
office by an expression of the consensus of the community through the vote of a
special assembly.” In determining what band custom was at the time, he held at paragraphs 44 and 45 that one must look
to the “views of the community” to make the subjective determination of
“whether the practices for choices of a council are ‘generally acceptable’ or
enjoy a ‘broad consensus’ among members of the Band.” The facts showed that
this removal practice had been used previously.
[68]
In the present case, I am not satisfied that the Affidavit
evidence of Joe, G. Sam, Shutter, York, and
Toodlican supports a broad community consensus that the Elders hold impeachment
powers. While the deponents explain and it is not in
dispute that the Elders have a customary judicial role within the Nlaka’pamax communities where the Elders can consider the
wrongdoings of community members and penalize persons found responsible, none
could point to an historical precedent for impeachment of a Councillor by a
committee of Elders pursuant to traditional justice.
[69]
I therefore find that the EIC did not have the
jurisdiction to impeach past and present members of the LNIB Council.
[70]
However, accepting there
lacks a broad community consensus that the Elders have impeachment powers is not inconsistent with accepting Elders play an
active and important role in the governance of Nlaka’pamax communities.
Rightly, a five-page Custom Election Rules document likely does not exclusively
and exhaustively set out in detail all LNIB customs.
[71]
Where it is not feasible for all
customs to have been codified, Justice Mosley’s analysis in Catholique,
supra to determine what is custom is helpful - the “views of the
community” are to be examined to make the subjective determination of “whether
the practices for choices of a council are ‘generally acceptable’ or enjoy a
‘broad consensus’ among members of the Band.”
[72]
The Affidavit evidence of Joe,
G. Sam, Shutter, York, and Toodlican shows a community consensus that
the Elders play a customary advisory and recommendation role in the LNIB community, essential guidance for which the
Elders are revered. The capacity to advise and make recommendations, rather
than impeachment powers, is more the tone of the Affidavit evidence.
[73]
The Elders’ customary
advisory and recommendation role necessarily
includes an investigative role and the ability to report findings to the LNIB
Chief, as the ability to advise and recommend is given its fullest meaning when
it includes the ability to investigate and report.
[74]
For the above reasons, I find that the EIC had the
jurisdiction to investigate the Councillors’ alleged wrongdoing, was entitled
to make the findings it did, and was allowed to subsequently report these
findings to the LNIB Council.
2. Were the Applicants afforded natural
justice and procedural fairness in the EIC process?
[75]
The Applicants submit that they were entitled to, and did not
receive, natural justice and procedural fairness. Also, they ought to have been
afforded the right to be heard, as supported by Prince, supra at paragraphs
39 to 42. Further, they had a legitimate expectation that the EIC would
only be making recommendations to Chief Moses and the Council.
[76]
The Respondents submit the
EIC’s proceedings were procedurally fair and in accordance with natural justice
for the following reasons: the EIC provided each member of the 2004-2007
Council with an opportunity to appear before the EIC and to make submissions;
the EIC members were elected from the LNIB membership and were free of
conflicts; the EIC obtained independent legal advice; the EIC undertook a
thorough review of all documentation; and the EIC provided written reasons. The
EIC submits the process of investigation and adjudication was fair and included
an opportunity for the Applicants to be heard, an opportunity which the
Applicants declined to take advantage of. I agree for the following reasons.
[77]
In Baker v. Canada,
[1999] 2 S.C.R. 817, 174 D.L.R. (4th) 193 (S.C.C.) the Supreme Court of Canada
stressed that the existence of a duty of fairness is flexible and variable,
and its content is to be decided in the specific context of each case. All of
the circumstances must be considered in order to determine the content of the
duty of procedural fairness. The more important the decision is to the
lives of those affected, the more stringent the procedural protections that are
required. There is no doubt that in the present case the seriousness of the
implications of an adverse finding by the EIC required that the individuals
affected be given the opportunity to present their case fully and fairly in an
impartial, fair, and open process.
[78]
I am satisfied that this
high standard was met.
[79]
First, as early as September
30, 2008, in a memorandum addressed to the LNIB Councillors, the impugned Councillors
were put on notice by Chief Moses that he was moving forward with the
investigation and that “as the results of the investigation can be quite severe
if there has been any breach of fiduciary duty or improper taking or use of
Bands funds by those under investigation, each is entitled to hire a lawyer at
their own expense to accompany their appearance before the Committee.”
[80]
Second, the evidence
demonstrates the following:
a)
The EIC advised the impugned
Councillors by letter delivered on or about February 11, 2009 of
the results of the EIC’s investigation and the EIC’s findings, provided the impugned
Councillors with a copy of the preliminary findings, and invited the impugned Councillors
to arrange an appearance before the EIC to submit evidence or make submissions
with respect to the EIC’s preliminary findings;
b)
The impugned Councillors
were warned that if they chose not to arrange an appearance before the EIC, the
EIC would issue its final report, findings, and recommended penalties without
their participation; and
c)
Despite the above, the
Applicants elected not to contact or appear before the EIC.
[81]
Despite the EIC’s invitation
and despite the caution expressed, the Applicants declined to appear before the
EIC. It is therefore difficult for the Applicants to now claim that they were
not afforded an opportunity to be heard.
[82]
As for the Applicants’ argument that
they had a legitimate expectation that the EIC would not impose penalties, the
EIC submits there is no Affidavit evidence that the Applicants expected the EIC
to confine its conclusions to recommendations, or that if the Applicants had
known impeachment was a possibility that they would have appeared before the
EIC. In fact, the only evidence from the Applicants is that they did not
acknowledge the legitimacy of the EIC, evidence adduced in the
cross-examination of Stuart Jackson. The EIC submits that Mr. Jackson had
no expectations whatsoever, and that he simply did not recognize the process. Again,
I agree with the EIC.
[83]
None of the Applicants state in their Affidavits
that if they would have known of the activities undertaken by the EIC, that
they would have appeared before the EIC. As pointed out by the EIC, the only
evidence provided by the Applicants for declining to appear is that the
Applicants did not recognize the process.
[84]
In addition, as stated above, the
Applicants were put on notice as early as September 30, 2008 of the seriousness
of the implications of a finding of breach of fiduciary duty.
[85]
More importantly, in light of the Oath
of Office sworn by each Applicant that states “we will
resign from our elected position whenever we have been found to be in
contravention of the Band’s election rules and Chief and Council Policy &
Procedures or of this oath of office,” I
cannot accept the proposition that the Applicants did not expect that the
results of the investigation could seriously impact their positions as Councillors,
and that their responses would have differed had they only known about the
possibility of impeachment.
[86]
I note the apt comment made by the
Supreme Court of Canada in Baker, supra at paragraph 26 that the doctrine of legitimate expectations, as
applied in Canada, “is based on the principle that the ‘circumstances’
affecting procedural fairness take into account the promises or regular
practices of administrative decision-makers” with respect to procedures, and
that it would be unfair for administrative decision-makers to “backtrack on
substantive promises without according significant procedural rights.” This is
clearly not the situation here.
[87]
No representations or promises were
made to the Applicants to the effect that a different process would take place,
and that there would be a subsequent opportunity for them to make
representations.
3. Were the EIC’s findings
reasonable?
[88]
The Applicants submit that the EIC’s findings
are unreasonable. They complain mainly about the process but do not challenge
the merits of the EIC decision in any detail.
[89]
For the Applicants, the non-compliance with
certain of the procedural requirements of the LNIB’s by-laws and policies has
been used to justify the finding of a breach of fiduciary duty. However, an
assessment of whether a fiduciary duty was breached must involve an examination
of substantive issues, rather than only an assessment of whether there was
compliance with procedural requirements, which the Applicants say was done by
the EIC.
[90]
Furthermore, they were entirely unaware of By-law
1987 #1 as it was not contained in their Councillor orientation book, and that
portions of By-law 1987 #1 significant to this matter, such as contracts having
to be tendered, have fallen into disuse. Also, the EIC is repeatedly concerned
that LNIB cheques had been signed by two Councillors instead of one Councillor
and one staff member, however this is of no concern since cheques are prepared
by the LNIB administration in the first place.
[91]
The Respondents submit that
the EIC was entitled to make the findings that it did, and the Applicants have
failed to fundamentally challenge the facts upon which the findings were based.
As such, the EIC’s findings fall within a range of reasonable outcomes.
[92]
According to the
Respondents, it is unclear exactly what is meant by the Applicants’ statement
that the EIC only found evidence of procedural irregularities and the
investigation did not address substantive issues, but the statement suggests a
severe misapprehension of the law concerning fiduciary obligations. The
Respondents submit a breach of procedures that results in Councillors receiving
contracts that they are not otherwise entitled to is clearly a breach of the
fiduciary duty that each of the Councillors owes to the LNIB. The overriding
concern is that election to a Councillor position should not be seen as an
opportunity for personal enrichment, as the interests of the LNIB must be
paramount.
[93]
The EIC submits its findings
fall within a range of reasonable outcomes. While the Applicants dismiss the
contraventions of the Custom Election Rules and the LNIB Chief and Council Policy
and Guidelines as non-compliance with procedural requirements, these are in
fact substantive provisions that are aimed at protecting the interests of the LNIB
membership as a whole. Accepting contracts at the expense of the LNIB was in
breach of the impugned Councillors’ fiduciary duties. Also, the Councillors
were bound to the Oath of Office they signed to uphold the laws of the LNIB,
and to resign if they were found to be in contravention of the LNIB’s election
rules and policies.
[94]
I conclude that the EIC’s findings with respect to the Councillors’ breach of their
fiduciary duties are reasonable, for the following reasons.
[95]
Band Councillors are in a
fiduciary relationship with band members, and hold a fiduciary obligation to
manage their band’s assets in the best interests of the band membership (Toney
v. Annapolis Valley First Nations Band, [2004] F.C.J. No. 2107, 2004 FC
1728 (F.C.)).
[96]
The law on fiduciary
relationships as cited in Toney, supra at paragraph 28 indicates that “the
fiduciary has a duty of utmost good faith to act in the best interests of the
beneficiary and to avoid a conflict of interest.”
[97]
The very high standard that
fiduciaries are held to is described in Canadian Aero Service Ltd. v.
O’Malley, [1973] S.C.J.
No. 97, 40 D.L.R. (3d) 371 (S.C.C.) at page 381-382 as “loyalty, good faith and
avoidance of a conflict of duty and self-interest,” and in Blueberry River
Indian Band v. Canada (Department of Indian Affairs and Northern
Development), [1995] S.C.J. No. 99, 130 D.L.R. (4th) 193 (S.C.C.) at paragraph 55 as
a “fiduciary is at very least bound to adhere to the terms of the instrument
which bestows his powers and creates the trust.”
[98]
The beneficiary of the
fiduciary duty owed by the Councillors was the LNIB membership as a whole.
[99]
In determining whether the
Councillors, in the position of fiduciaries, had fulfilled their obligations,
according to Toney, supra at paragraph 29, “the central inquiry
is not whether the fiduciary has been dishonest or acted in a fraudulent
manner, but whether he has acted in the best interests of the beneficiary and
without conflict of interest.” It is therefore sufficient to show that the
fiduciary acted inconsistently with the LNIB’s best interests. I wish to
emphasize that the EIC considered the standard set out in Toney, supra when examining the Councillors’ conduct.
[100]
The LNIB has developed rules,
regulations, and procedures to ensure that Councillors do not receive
inordinate financial benefits by virtue of their elected position. The EIC
considered these when conducting its investigation. The
rules, regulations, and procedures applicable to the complaint that the
Councillors, as employees or contractors, improperly supplied and were paid for
services by the LNIB, among others, are reproduced below.
[101]
Rule 9.1 of the LNIB By-law
1987 #1 states the following:
9. Contracts and Tenders
9.1. Except in an emergency or as predestinated by the
Band Council where the contract is expected to exceed $1,000.00, tenders shall
be invited.
[102]
Section 1 of the LNIB Chief
and Council Conflict of Interest Policy states the following:
Duties of Chiefs and Councillors
1. Every Councillor of the Band, in exercising his or her
powers and performing his or her functions, shall
(a) act honestly and in good faith and in the best interest
of the members of the Band; and
(b) exercise the care, diligence and skill of a reasonably
prudent person.
[103]
Section 20 of the LNIB Chief
and Council Policy and Guidelines states the following:
No Council member shall hold a paid administrative position
within the LNIB operations or any departments thereunder unless otherwise
consented to by a decision of council and approved by the community.
Notwithstanding this, Council members are entitled to enter into short term
professional service contracts with and as requested by Administration. Such
contracts shall not exceed two (2) months in duration or $5,000 value at any
given time.
[104]
The Oath of Office sworn by the 2004 to 2007
Council included the following:
3. We will not
allow our business or personal affairs to influence our decision making and we
will always consider the best interests of the Community;
4. We will
uphold the laws of the Band as approved by the Band Council and as learned form
general meetings and at large from Band Members, Elders and Youth;
5. We will
strive to preserve and enhance our culture and heritage and strive to maintain
a proper place for our Band Members in society;
6. We will
resign from our elected position whenever we have been found to be in
contravention of the Band’s election rules and Chief and Council Policy &
Procedures or of this oath of office.
[105]
The facts indicate that
Councillors Jackson, Coutlee, and Sam acted contrary to the above, thereby
exhibiting actions that fail to uphold their obligations as fiduciaries. Each,
by way of Affidavit evidence, has given context to their breaches, but at no
point have they provided evidence to the effect that the EIC’s findings are
unreasonable.
[106]
With respect to the awarding
of an employment contract to then sitting Councillor Robert
Sterling Jr. (not an Applicant) whom the EIC found was in breach of s. 20 of
the LNIB Chief and Council Policy and Guidelines, the
EIC found this employment contract to be one where the sitting Councillors had
breached their fiduciary duties. Councillors Jackson, Coutlee, and Sam did not
provide any evidence to support Robert Sterling Jr.’s employment not
being in breach of LNIB rules, regulations, and procedures
on restrictions on sitting Councillors’ employment.
[107]
Councillors Jackson,
Coutlee, and Sam indicated by way of Affidavit evidence that this was the only
job applicant with the required archaeology degree. However, Councillor Sam in
cross-examination on his Affidavit indicated that he did not remember whether
the job was advertised at all, and that he knew that the contract was for a
period of over two months, but the employment was never put to a vote at a general
LNIB meeting. Similarly, in cross-examination on her Affidavit, Mary June
Coutlee stated she knew Robert Sterling’s contract with the LNIB would be for
more than two months but was not approved at a general LNIB meeting.
[108]
With respect to the awarding
of an employment contract to then sitting Councillor Stuart Jackson, whom the EIC found was in breach of s. 20 of the LNIB Chief and Council Policy and Guidelines for accepting
an employment contract without community approval, the EIC found Councillors
Jackson, Coutlee, and Sam breached their fiduciary duties by approving the
employment contract of a fellow sitting Councillor. Councillors Jackson,
Coutlee, and Sam by way of Affidavit evidence, in trying to dispute the EIC’s
findings on this issue, do not explain how Councillor Jackson was awarded the contract
in issue.
[109]
The Third Supplemental
Affidavit of Chief Moses indicates that there were other LNIB members who had
more teaching experience than Councillor Jackson and who were interested in the
position. Upon cross-examination on his Affidavit, Councillor Jackson admitted
that he had never held an administrative position in a school before becoming
principal of the LNIB school, and that his teaching experience consisted solely
of an eight-week teaching practicum. Also, the affiants stated that Councillor Jackson’s
hiring as a LNIB employee was never approved by the Community at a general LNIB
meeting, despite the knowledge that it was for more than a two month term.
[110]
The Applicants submit that in this case, the
intent of the governing regulations was met since Councillor Jackson did not
participate in the Council discussion or vote to approve his contract as
interim principal. Toney, supra makes the following apt comment at
paragraph 33, reasoning which I adopt:
33
Procedural safeguards, such as the one relied on by the respondent, are
established to ensure that fiduciaries are not involved in decisions in which
they have a personal interest. The rationale is that if the fiduciary is
removed from the decision-making process, then the remaining
"unbiased" fiduciaries will be able to make a decision that accords
with the best interest of the beneficiary. The difficulty in the present case
is that all the fiduciaries (the respondent, Mr. Copage and Ms. Toney) had an
interest in the contracts. Although Mr. Copage and Ms. Toney may not have had a
direct interest in the respondent's contract, it was in their best interest to
award the respondent a favourable contract so that he would reciprocate on the
same terms. Accordingly, it made no difference whether the respondent left the
room when his contract was being discussed, since all of the Council members
were tainted by self-interest. Moreover, the respondent put himself in a direct
position of conflict when he signed the Band Council Resolution accepting and
ratifying his own employment contract.
[111]
With respect to Councillor
Sam and the awarding of contracts to his backhoe business, while the Applicants
have provided Affidavit evidence which states that Councillor Sam was diligent
in declaring his own personal conflict concerning LNIB contracts, the evidence
also shows there existed other qualified LNIB members capable of performing the
contracts. The EIC found the contracts were awarded without following the
proper procedures. The Applicants did not submit evidence that countered the EIC’s
findings on these contracts.
[112]
In response to the
Applicants’ assertion that they were unaware of By-law 1987 #1 and that it has
fallen into disuse, the Affidavit of Chief Moses reveals that Councillor
Coutlee was a Councillor at the time this by-law was developed and that she
signed it into law. Apart from Councillor Coutlee’s participation, claiming an
unawareness of this by-law does not change the facts which support the
reasonableness of a finding that there was a contravention of the by-law,
and the fact that the by-law is still on the books shows me its purpose and
usefulness.
[113]
The Applicants have not
advanced any evidence to dispute the EIC’s findings regarding the conduct of
Lorne Sahara, Shannon Kilroy, and former Chief Arthur Dick. Consequently, all
the EIC’s findings on these three individuals are uncontested.
[114]
Based on a review on the
standard of reasonableness, I am satisfied that the EIC’s findings fall within
a range of possible and acceptable outcomes, defensible both in respect of the
facts and the law.
4. Were
the three Band Council Resolutions validly passed?
[115]
The Applicants submit that even a custom band is
subject to s. 2(3) of the Indian Act,
which states the following:
2(3) Unless the
context otherwise requires or this Act otherwise provides,
…
(b) A power
conferred on the council of a band shall be deemed not to be exercised unless
it is exercised pursuant to the consent of a majority of the Councillors of the
band present at a meeting of the council duly convened.
[116]
The Applicants highlight that the provision
indicates that powers conferred on Council require a majority vote at a duly
convened meeting, and that the three BCRs did not emanate from a duly convened
meeting. Première Nation Malecite de Viger v. Canada (Indian Affairs and
Northern Development), [2006] F.C.J. No. 245, 2006 FC 187 (F.C.) at paragraph 31 supports
the Applicants’ point that even a custom band is subject to s. 2(3) of the Indian Act.
[117]
Section 28 of the LNIB Chief and Council Policy
and Guidelines states Council quorum must be five members in good standing, and
s. 33 states Council decisions are made by consensus or a majority of quorum
after a matter has been moved and seconded.
[118]
The Applicants submit that the three BCRs
wrongly presuppose quorum had become three. Council is usually made up of one
Chief and seven Councillors, with quorum being five. Four of eight members of
the new Council had also served on the previous Council, which Chief Moses
sought to investigate. A fifth member was the son of one of the impeached. This
left, according to Chief Moses, only three eligible members of Council – Chief
Moses and two others were not in a position of conflict with respect to the
actions of the previous Council, and could therefore form quorum.
[119]
The Respondents agree that custom
band councils are still constrained by s. 2(3) of the Indian Act,
and submit that this provision was met.
[120]
The March 16, 2009 BCRs were
discussed, passed, and signed at a meeting of Chief Moses and Councillor Connie
Joe. The BCRs could not be discussed at a meeting of all Councillors because
the other Councillors other than Yvonne Basil were in conflict with the
substance of the BCRs, namely adopting the EIC Report’s recommendations. Yvonne
Basil had a conflict of interest with respect to the EIC report because she was
a named party in this application for judicial review. While Councillor Basil
was absent from the meeting, she was given an opportunity to object to the BCRs
in writing within 7 days, and there is no evidence she provided any such
objection (Conflict of Interest Policy, s. 3(3)).
[121]
The Respondents point to the
Chief’s powers under s. 23(e) of the LNIB Chief and Council Policy and Guidelines
to make decision “on behalf of Council” when those decisions are necessary for
good government, and submit the circumstances of this case justify invoking
this power to implement the sanctions recommended by the EIC.
[122]
According to the
Respondents, while the Applicants have argued that procedural requirements for
the implementation of impeachment recommendations have to be rigidly followed, the
Federal Court has held that the rationale behind a strict adherence to the
procedural requirements for the implementation of impeachment recommendations
is the protection of the Band in general, not the protection of a Chief or
Councillors. See: Qualicum First Nation v. Recalma-Clutesi, [2006]
F.C.J. No. 1097, 2006 FC 854 (F.C.) at paragraphs 36-37.
[123]
In any event, the
Respondents argue that s. 2(3) of the Indian Act contemplates that these
procedural requirements only apply “unless the context otherwise requires.” As
such, the Respondents submit that the present unique context is one in which
the procedural requirements do not strictly apply. The present situation is
said to be extraordinary since sitting Councillors have been found to have
breached LNIB laws, policies, and their fiduciary duties. However, the sitting Councillors
refuse to declare their inherent conflict in regard to the implementation of
the EIC’s findings, findings which are largely uncontested. It is impossible
for the Chief and Council to pass a BCR implementing the recommendations in
accordance with strictly construed procedural requirements, because the sitting
Councillors who were impeached form a majority. According to the Respondents,
this context justifies a reasonable departure from the strict procedural
requirements. The BCRs should be allowed, despite technical deficiencies.
[124]
I disagree with the
Respondents for the following reasons.
[125] In my opinion, the Chief’s power under s. 23(e)
of the LNIB Chief and Council Policy and Guidelines to make decisions “on
behalf of Council” when those decisions are necessary for good government was
not validly engaged here. First, each of the three BCRs was premised on valid
impeachments. I have found that the EIC had the jurisdiction to investigate and
make the findings it did, but that it did not have the jurisdiction to impeach.
Passing BCRs that are based on the acceptance of impeachments that resulted
from a flawed process does not properly engage s. 23(e). I wish however
to recognize Chief Moses’ best intentions and good faith efforts in resolving a
very serious and exceptional situation presented before him as the Chief of the
LNIB as a whole.
[126] Further, the BCRs were technically deficient. Chief
Moses, by instituting the memorandum process for passing BCRs, had in fact
created a BCR procedure separate and apart from the proper procedure of holding
a vote. He unilaterally made this change. As pointed out by the Applicants, and
I agree, it could not be said that these BCRs emanated from a duly convened
meeting. This is the result of a unique situation where Chief Moses could not
refer the BCRs to a proper quorum of Council, since obtaining the required
quorum was impossible due to the inability of the impugned Councillors to
participate in quorum, to vote on matters related to their own wrongdoings.
[127]
The three BCRs dated March
16, 2009 were therefore not validly passed.
5. Were the Councillors’
resignations validly accepted?
[128]
According to the
Respondents, the Oath of Office sworn by each Councillor on election to the
LNIB Council, which states at s. 6 that Councillors will “resign from our
elected position whenever we are found to be in contravention of the Band’s
election rules and Chief and Council Policy & Procedures or this oath of
office,” means Chief Moses could deem the Councillors to have resigned once
found in contravention of the LNIB Chief and Council Policy and Guidelines or
the Oath of Office, citing Minde v. Ermineskin Cree Nation, [2008]
F.C.J. No. 203, 2008 FCA 52 (F.C.A.) in support.
[129]
The Applicants state no
resignations were ever given.
[130]
In Minde, supra
at paragraph 51, the Court of Appeal held
that an Elders’ Council could properly deem the office of the Chief to be
vacated when the Chief was found to have breached Band laws and his fiduciary
duties by misappropriating Band finances. The Chief had undertaken to vacate
his office upon such a finding and the Court of Appeal held that an agreement
of that nature was not purely ceremonial, and there was no basis for
disregarding his promise to resign.
[131]
In my opinion, s. 6 of the
Oath of Office is clear that should findings be made that the Councillors who
swore the Oath acted in contravention of the LNIB Custom Election Rules, the LNIB
Chief and Council Policy and Guidelines, or the Oath of Office itself, the Councillors
must be considered to have resigned. I have accepted, and found reasonable, the
findings made by the EIC that the impugned Councillors have contravened the
applicable rules, policies, and procedures.
[132]
The Chief of the LNIB has the power, under s.
23(e) of the LNIB Chief and Council Policy and Guidelines, to “make decisions
when required on behalf of Council when such decisions are necessary for good
government.” In my opinion, s. 23(e) grants Chief Moses the power to accept
the resignations called for by s. 6 of the Oath of Office. These unique
circumstances, combined with the strength of an Oath of Office that was signed
by each Councillor and witnessed by four elders, allow for Chief Moses’
acceptance of the resignations.
6. Is the Applicants’ challenge
to the funding of the EIC time-barred?
[133]
I find the Applicants’ challenge to the funding
of the EIC is time-barred, for the following reasons.
[134]
Section 18.1(2) of the Federal
Courts Act, addressing time limitations with respect to bringing
applications for judicial review, reads as follows:
Time limitation
18.1 (2) An application for judicial review in respect of a
decision or an order of a federal board, commission or other tribunal shall be
made within 30 days after the time the decision or order was first communicated
by the federal board, commission or other tribunal to the office of the Deputy
Attorney General of Canada or to the party directly affected by it, or within
any further time that a judge of the Federal Court may fix or allow before or
after the end of those 30 days.
[135] The Respondents correctly note that s. 18.1(2) of the Federal
Courts Act requires applications for judicial review to be filed 30
days after the communication of a decision, and the Notice of Application filed
by the Applicants on March 10, 2009 means only decisions made 30 days prior
could be reviewed. I add that using April 16, 2009, the filing date of the
amended Notice of Application, as the date from which to count backwards 30
days would not assist the Applicants in arguing they are not out of time.
[136] The questions therefore become do the provisions found in
the Terms of Reference cause the LNIB to fund the EIC, and when was a decision
to fund made and communicated to the Applicants?
[137] The
Applicants do, but not in the context of this issue, indicate “the particulars
of the payments to the EIC referred to in [this decision on funding under
review] have not yet been communicated to the Applicants.” The particulars of
funding, however, are separate and apart from learning of the decision to fund,
and it is the timeline of the decision to fund that is important here.
[138]
The Applicants would have at least by October 22, 2008 been made
aware that the LNIB would be providing the funding. This was the date of the
issuance of the Terms of Reference, and the Terms of Reference state the LNIB
will fund the EIC panel members’ honoraria and the solicitor who will assist
the EIC.
[139]
It was before this date, however, on October 14, 2008, that the
then Council passed Motion #5 indicting its non-acceptance of
the EIC, stating “that the ‘investigation’ stop as of October 14, 2008, and
that no further expenditures be made on this exercise until it’s discussed at a
special meeting of council […].” Passing a
motion to halt the EIC’s exercise is one aspect, but Councillors specifically
addressing funding presupposes they knew the LNIB is behind the funding. It
would not be logical for Council to have specifically addressed funding without
knowing the LNIB is the source.
[140]
Either way, it is clear that the Applicants were
by October 14, 2008 made aware of funding for the purposes of a decision being
communicated to them, and if not, by October 22, 2008, when Terms of Reference
indicated the intent to have the LNIB fund the
EIC.
[141]
The Respondents rightly point out that
the Applicants have not presented evidence to show that further decisions to
fund the EIC were made after November 28, 2008, the fluid date which the
Applicants state in framing the funding issue to be reviewed.
[142]
Since it is the communication of the
decision that the LNIB will provide the funding and not the communication of
the particulars of the monetary amounts to be provided that is key here, based
on this timeline, I agree with Respondents that the Applicants’ challenge to
the funding of the EIC is time-barred.
CONCLUSION
[143] For the above reasons, this application for judicial review is
allowed in part.
[144] While the EIC does have an advisory and investigatory function and
therefore its findings and recommendations stand, the EIC does not have an
adjudicative function with respect to impeachment proceedings, covered by the Custom
Election Rules and reflected by the EIC’s Terms of Reference. Thus, the
impeachment of the Councillors by the EIC is invalid.
[145] Further, as stated above, the three BCRs of March 16, 2009 were
premised on an invalid impeachment, and were passed based on a flawed process.
Accordingly, the three BCRs must be set aside.
[146] Having
accepted the EIC’s findings, and subsequently having decided the Councillors
are deemed to have resigned and their resignations can be validly accepted by Chief
Moses, there are issues contained in the three March 16, 2009 BCRs which remain
to be decided. I now turn to the appropriate remedy, one which can result in a
broad community consensus given this unique situation in which the parties find
themselves.
[147] Counsel
for the Applicants has suggested that a vote by the LNIB general membership,
held at a general band community meeting and resulting in the passing of
general band motions reflecting the will of the electorate, would be one way to
proceed. General band community meetings may be divisive and unpleasant.
Counsel for the EIC cautioned that sending difficult and challenging issues
like these back to the LNIB community membership as a whole for a community
meeting and public vote is not a desirable option, for reasons including some
LNIB members live off reserve and therefore could not easily participate, and
others experience intimidation in such a setting as fellow community members
witness how each votes.
[148] As
was suggested by counsel for the EIC as a possible remedy, I find that the best
resolution is for the LNIB to have a referendum on the issues remaining to be
decided. This would be preferable to a community meeting and public vote, and
would respect the wishes of the EIC.
[149] The
three March 16, 2009 BCRs are hereby declared invalid. The BCRs are returned to
Chief Moses and the LNIB community for the remaining issues contained therein
to be voted on by way of referendum.
COSTS
[150] The Applicants seek to have the matter of costs deferred to a later
hearing, following a decision in this matter. The Applicants submit that if
successful on their application, they ought to receive full indemnity for their
legal fees, given it would be unfair for the Applicants to receive only partial
indemnity when Chief Moses would receive full indemnity by having unilaterally
claimed the right to act on behalf of LNIB Council, and the EIC would claim
full indemnity due to the indemnity provision in its terms of reference.
[151] The Supreme Court of British Columbia in the related action
discontinued in that jurisdiction indicated the Federal Court is to decide on
costs with respect to the British Columbia proceeding.
[152] The Respondents support the Applicants’ request to have the
issue of costs dealt with after a determination of the application on its
merits. They anticipate they will have significant issues to raise on
costs.
[153] Thus, the issue of costs will be decided at a hearing on
the matter, to be heard on a date to be determined by the administration.
JUDGMENT
THIS COURT ADJUDGES
that:
1.
The application for judicial review is allowed
in part.
2.
The findings and recommendations of the EIC are
accepted and are found to be reasonable.
3.
The impeachment of the impugned Councillors by the EIC
is declared invalid.
4.
The resignations of the Councillors are validly
accepted by Chief Moses.
5.
The three March 16, 2009 BCRs are declared invalid.
6.
The BCRs are to be returned to Chief Moses and the LNIB community for
the remaining issues contained therein to be voted on by way of referendum.
“Danièle Tremblay-Lamer”
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