When should staff leave a board meeting?
By Bruce D. Woodrow
Sunday, June 02, 2002
Staff routinely attend board meetings, including confidential portions. When an eviction is considered, staff usually stay with the board while it deliberates. Responsibilities may include advice on options, timing and past decisions, as well as recording the decision and preparing and serving any eviction documents.
However, if a Co-ordinator makes a complaint against a member, should that Co-ordinator remain with the board while it considers the eviction of the member? Does it depend on whether the Co-ordinator speaks or otherwise participates in the decision-making?
An appeal court in Ontario recently answered both questions.
The eviction was based on arrears, late payments and unreasonable disturbance. In addition to complaints from 4 other residents, the board received a written complaint from the Co-ordinator about the behaviour of the Member. The Co-ordinator repeated her complaints in the presence of the Member and his lawyer, and was questioned by both a lawyer for the Co-operative and the lawyer for the Member. When the Member and his lawyer left the board meeting, the Co-ordinator remained as usual. There was no evidence that the Co-ordinator said anything or played any role while the board made its decision.
The board decided to evict the Member on all grounds, including the unreasonable disturbances, as well as the arrears and late payments. A hearing was held in October 2000, the trial judge did not feel that the presence of the Co-ordinator at the board meeting was a problem, and the eviction decision was upheld. The Member appealed. This appeal was finally heard by the Divisional Court on May 15, 2002. The Member based his appeal on 6 different issues. The Court held that there was no merit to 5 of them. However, the presence of the Co-ordinator during deliberation by the board was a problem.
The Court held that the Co-ordinator “had a personal stake in the outcome of the deliberations” and “was a person whose interests … would be affected by [the board’s] decision”. Therefore, the presence of the Co-ordinator “under these circumstances gave rise to a reasonable apprehension of bias”. The result was that this lack of procedural fairness invalidated the board decision.
It is important to note that the issue was not whether the Co-ordinator participated in the discussion. Her mere presence was enough to affect the process.
The Court did not make an order in favour of the Member. Rather, the trial decision was set aside and an order was made refusing a writ of possession, but only on the basis that the Co-operative’s application was premature, the board of directors not yet having held a valid hearing. The Court explicitly referred the matter back to the board of directors to hold another hearing or take other appropriate action.
Because the Member won on a technical argument but lost on the other substantive points, the Co-operative was not ordered to pay any of the Member’s costs.
Most boards realize that a director with a conflict of interest must not participate in an eviction decision. This principle also applies to staff. A person with a conflict of interest cannot vote and must not even be present for the discussion.
