COURT OF APPEAL FOR ONTARIO

DATE: 20010219 DOCKET: C35754; M26917

BEFORE: CARTHY J.A. (IN CHAMBERS)

BETWEEN:

THE MONTREAL AND CANADIAN DIOCESE OF THE RUSSIAN ORTHODOX CHURCH OUTSIDE OF RUSSIA INCORPORATED

Plaintiff/Respondent

• and -

PROTECTION OF THE HOLY VIRGIN RUSSIAN ORTHODOX CHURCH (OUTSIDE OF RUSSIA) IN OTTAWA INCORPORATED and ST. VLADIMIR’S RUSSIAN RESIDENCE OF OTTAWA INC.

Defendants/Appellants

Counsel: Joseph Y. Obagi, For the appellants Anne M. Mullins, For the appellants by Notice of change of solicitors Eric Williams, For the respondent

Heard: February 9, 2001

CARTHY J.A.:

[1] The motions before me arise out of a trial judgment released on February 5, 2001 and were heard on February 9. Weather conditions prevented two counsel from attending in Toronto and I therefore proceeded with one counsel, Mr. Obagi, in attendance and the other two, Mr. Williams and Ms. Mullins participating by telephone. The issue, on the surface, is control of a church parish pending appeal from the judgment handing control to the Diocese, the plaintiff in the action. The defendants, appellants applied for a stay, matters became more complicated through the following days and in the ordinary course there would have been an adjournment. We had some discussion as to filing of material by the plaintiffs and cross-examination on filed material. I did not sense any real push for postponement except on terms that would be unacceptable to the other side, nor did I see how I would be assisted by further evidence and therefore, following the urging of Mr. Obagi, I heard full argument.

Background

[2] In the early 1920’s, shortly after the Russian revolution, the Russian Orthodox Church Outside of Russia (“ROCOR”) was organized by orthodox adherents beyond Russia’s borders. A separate Christian orthodox church, known as the Moscow Patriarchate continued to operate within Russia. In Canada there is one diocese of ROCOR, the plaintiff in these proceedings, and 20 parishes, one of them being the first named defendant, which I will call the Holy Virgin. The Holy Virgin operates a church in Ottawa, owns land and also controls a seniors’ residence incorporated as the second named defendant.

[3] In 1999 the parish priest of Holy Virgin suggested to his parishioners that, with the fall of communism in Russia, it was time to return to the Moscow Patriarchate. A meeting was held at which a resolution was passed changing the by-laws and letters patent of Holy Virgin to redirect its allegiance from ROCOR to the Moscow Patriarchate.

[4] The ruling Bishop of ROCOR took exception to this move and this litigation was commenced ending in a trial and reasons for judgment issued on February 5, 2001 declaring the resolution in question null and void and setting a procedure over the following 90 days to reconstitute the board of directors and membership in the parish. It was further provided that until the reconstitution is accomplished the ruling Bishop, Michael Donskoff, has the right to exercise all powers of the parish council as provided in the by-laws. The fundamental reason for this judgment was that the by-laws of the parish provided that they could not be amended without approval of Bishop Michael and the Synod of Bishops of ROCOR.

[5] The defendants through their counsel, Joseph Obagi, immediately appealed and sought a stay order pending the appeal. Bishop Michael, exercising his new powers instructed that a notice of change of solicitors be served, naming Rasmussen, Starr, Ruddy as solicitors for the defendants, appellants. That was followed by a notice of abandonment of the appeal. The response from Mr. Obagi was a notice of motion to strike the notice of change of solicitors and the notice of abandonment.

Analysis

[6] The first issue is whether, in light of the abandonment of the appeal I have any jurisdiction. My opening observation to counsel for the plaintiff was that a trial judge could not by a judgment eliminate a power of appeal and, thus, the judgment could not be interpreted to that end. His response was that he did not seek to inhibit an appeal and would consent to an order under rule 13.01 appointing the dissident directors or the Patriarchate as parties to prosecute the appeal. His reason for resisting the appeal as presently constituted is that the appellants, through the appeal and stay order seek to use the funds of the Ottawa parish to support the appeal. He puts it that $300,000 of parish funds has been expended in legal fees to support the litigation to date and that if an appeal is pursued it should be at the expense of those individuals who are interested in that appeal.

[7] Mr. Obagi rejected the suggestion that intervenors be added as parties under r.13.01(1) which reads:

13.01 (1) A person who is not a party to a proceeding may move for leave to intervene as an added party if the person claims,

(a) an interest in the subject matter of the proceeding;

(b) that the person may be adversely affected by a judgment in the proceeding; or

(c) that there exists between the person and one or more of the parties to the proceeding a question of law or fact in common with one or more of the questions in issue in the proceeding.

He argued that this issue had arisen in December 2000 when the plaintiffs moved before the trial judge to prevent him being paid from the funds of the parish. Panet J. held that the interests of the dissidents was represented by the named defendants and that there was no basis for preventing payment of legal fees for that representation.

[8] As an aside, it became apparent to me at this point that the purpose of the motion for a stay of execution was centered upon access to legal expenses. Allegations are made of disruption of the operation of the church and seniors’ home if Bishop Michael takes control, but I see little substance to that concern. The highest it is put is that the Bishop is not familiar with the financial affairs and administration of the defendants. No one could conclude on this material that assets may dissipate or that the church and its parishioners could not return to the position they were in before judgement after a successful appeal.

[9] Returning to the issue, I questioned why the individuals who have an interest in secession were not already parties to the litigation. This led to a labyrinth of history of previous motions and changes of parties which need not be detailed here. It is sufficient to note that the plaintiff’s counsel made the same suggestion prior to trial as before me – that there was no need for the defendant institutions to be represented and that Mr. Obagi should be representing those with an interest in changing affiliation.

[10] If I was not faced with a jurisdictional issue by reason of the abandonment of the appeal, I would refuse to stay execution of the judgment pending appeal. Whatever ruling the trial judge made as to payment of fees in December, his February 5th reasons were meant to be acted on in the following 90 days, including control of the financial affairs of the defendant institutions. The rules do not stay that form of judgment and the circumstances are now entirely different. In December, the plaintiff was in the position of seeking an injunction, in fact it was characterized as a Mareva injunction. Now, the defendants are seeking an indulgence – the stay. Every judge who has dealt with this litigation, and there have been many, has sought to bring the dispute to an early end. On my observation. Panet J. has devised a carefully designed formula for doing so. As stated earlier, if the Court of Appeal holds otherwise, the process can be unwound.

[11] The appellants’ material indicates that the parish funds are needed to support the appeal. No specifics are offered as to the ability of those individuals who wish to secede to fund it, (there are said to be 80 of them) nor of the Moscow Patriarchate’s interest, if any, in the issue. Further, while the affidavit filed suggests errors by the trial judge in imposing a formula of control upon the defendants, I see nothing in the material to contest the simple fact that the by-laws required the Bishop’s and Synod’s consent, and these were lacking.

[12] In conclusion, given the consent of the plaintiffs to permit intervenors to pursue the appeal I do not consider that the notice of abandonment constitutes a denial of the right of appeal – my early concern. The time has come, probably later than it might have, for the true protagonists to stand against each other. The defendant institutions and their property are nominal parties to this struggle. The battle is between the diocese and those who wish to defect or to have them defect.

[13] I order that the notice of abandonment stand and leave it to Mr. Obagi and his clients to launch a fresh appeal, if so advised, in accordance with the consent of counsel for the plaintiffs recited herein. I would hope that a draft order under r.13.01 could be consented to and issued by mail. I assume the present defendants would then be nominal parties.

[14] Costs of these motions in the cause if there is an appeal. Otherwise no costs.

Released: Feb. 19, 01 Carthy J.A.