COURT FILE AND PARTIES
COURT FILE NO.: CV-12-750-00
DATE: 2012-04-02
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Streetsville Meadowvale Football Corporation
BETWEEN: Rob Fields, Sherry Fields, Kevins Wils, Patricia Domaradzki, Lance Rampone, Kenneth Thom, Craig Morgan, John McTaggert and George Sturrock
Applicants
AND:
Claire Ann Ward
Respondent
BEFORE: Ricchetti, J.
COUNSEL: T. McLean, Counsel, for the Applicants
Claire Ann Ward, self represented
HEARD: March 30, 2012
ENDORSEMENT
[ 1 ] This is a very sad situation. Children simply want to enjoy extracurricular sports. However, parents are needed to run the organizations. Sometimes, like this case, the actions of the parents get out of hand where multiple lawsuits are brought and defended to determine which of two groups of parents will control the organization. The bottom line is that the children have not been the prime focus of the parents. Money which properly should be spent on the children’s program is now being spent on legal fees.
[ 2 ] Justice Seppi granted an injunction freezing the assets and bank account of the Streetsville Meadowvale Football Corporation (SMFC). I am not going to repeat some of the facts from a related claim, which included the same parties now before me, as they are set out in Justice Seppi’s endorsement of October 7, 2011.
The Facts
[ 3 ] At issue is control of SMFC. This is similar to the issue before Justice Seppi, namely whether Ms. Ward and Ms. Thomas had improperly taken over the SMFC and were using or dissipating its assets. It is noteworthy that SMFC was a plaintiff in the action/motion before Justice Seppi and Ms. Ward was a defendant. Ms. Ward sought to bring a cross- claim on behalf of SMFC. Justice Seppi struck out Ms. Ward’s cross-claim. Before Justice Seppi were numerous affidavits from members of the Board of Directors of SMFC which had been removed by Ms. Ward but which members claimed they had not been properly removed and remained members of the Board of Directors of SMFC.
[ 4 ] These applicants bring this application seeking to strike out certain Change Notices dated July 27, 2010 and July 28, 2010 filed by Ms. Ward and other supporters with Ministry of Government Services removing the prior Board of Directors of SMFC on file and replacing them with Ms. Ward and others sympathetic to a change in the organization. This specific issue was not before Justice Seppi.
[ 5 ] The Mississauga Football League Inc. (MFL) is a non profit organization that has provided amateur football to children throughout the City of Mississauga, in affiliation with Mississauga, for over 40 years.
[ 6 ] MFL caused SMFC to be incorporated in 2002 to take advantage of a grant that was available and to start some bingo games as fund raising. Mr. Sturrock was its first director and, as far as he is concerned, he has never been removed as director.
[ 7 ] In 2009, the MFL became aware that a club called – Streetsville Meadowvale Football Corporation was operating and working or purporting to work with the Mississauga Warriors Football Club – a for profit organization that competes with the MFL. Ms. Ward clearly had some involvement with the Mississauga Warriors Football Club.
[ 8 ] At a meeting on June 8, 2009, the minutes of SMFC reflect that Ms. Ward resigned from SMFC. However, that was not the end of Ms. Ward and her supporters involvement with SMFC.
[ 9 ] Why Ms. Ward and her supporters didn’t simply incorporate another company for their football program is an unanswered question.
[ 10 ] On November 9, 2009, Ms. Ward attended a meeting of SMFC. A member of the MFL attended to advice that MFL intended to dissolve SMFC because of the actions the executive of SMFC had taken. However, Ms. Ward attended and told the meeting that she and several of her supporters were the Board of Directors of SMFC and had dismissed the prior Board of Directors.
[ 11 ] Ms. Ward had reasserted herself into the control of SMFC because the board appointed by MFL was not “adequately managing the organization”: The following exchange took place during the examinations for discovery in the other action:
A. They were not. They did not take over the responsibility to manage the organization. They didn’t take the signing authority for the banks. They didn’t take signing authority for the bingo accounts. How do you manage the organization when you don’t take over what you should be doing?
Q. But you just said to me that you refused to allow to sign over the stuff---
A. We did not refuse to allow it. We said, “you do this. You get our names off of it” – we didn’t refuse anything. They refused us several times, Tyler, several.
Q. They refused to give you a release.
A. Apparently.
Q. So it wasn’t poorly run. It was because they refused to give you a legal release that you reasserted control; is that no correct?
A. Yes
[ 12 ] On February 10, 2010 MFL dissolved SMFC and appointed a new board (which did not include Ms. Ward), on the basis that SMFC was an area association under the jurisdiction of the MFL. Under MFL’s articles (Article VIII) MFL has the authority to take over the management of the area associations. How or what legal basis one corporation has to dissolve another corporation is an unanswered question but I am satisfied it does not need to be determined on this application.
[ 13 ] One of the MFL’s primary concerns was that SMFC had approximately $100,000 in its bank account in 2009 and a lengthy list of assets (football equipment). The football equipment was understood by MFL to be in a storage locker and not available to either group until matters were resolved. It then became known to MFL that, despite assurances from the storage company that the football equipment would remain locked pending resolution of this dispute, Ms. Ward using her position as President of SMFC accessed the lockers, took the football equipment and emptied the storage locker.
[ 14 ] Despite MFL’s position regarding SMFC, Ms. Ward and her supporters did not back down. A meeting was called on March 24, 2010 where SMFC announced it was separating from MFL. Despite the lack of support at the meeting, Ms. Ward and her supporters proceeded onward.
[ 15 ] As expected, the legal battles began.
[ 16 ] Again, the question needs to be asked why Ms. Ward and her supporters just didn’t start a new corporation to run their own amateur football program is baffling. Instead, because of the confusion and law suits, there was a less a full season of football for SMFC – more importantly for the children.
[ 17 ] Ms. Ward and her supporters proceeded to file the Change Notices on July 27 and 28, 2010 to formally remove all of the executive of SMFC and put themselves as the current directors and executive. This appears to be nothing more than carrying out what Ms. Ward announced on November 9, 2009.
[ 18 ] There are no written resignations from the directors Ms. Ward removed on July 27, and 28. 2010. In fact, 9 of those directors filed affidavits confirming that they had not resigned and continued to be directors of SMFC.
[ 19 ] Ms. Ward states that she has been a volunteer and does not have experience with corporate filings. Whether this is true or not doesn’t assist in this case. Ms. Ward’s evidence is inconsistent. I will give a few examples:
a) On June 8, 2009, Ms. Ward resigned. However, notwithstanding that she resigned, she continued to be involved throughout. She is shown in the February 24, 2010 meeting as being the president of SMFC;
b) Ms. Ward felt she could take over SMFC simply because she didn’t like the way the new board appointed by MFL was operating. That is not a valid reason for Ms. Ward doing what she did;
c) Ms. Ward, in her counsel’s letter of November 12, 2009, agreed that her and her supporters would resign from the Board of SMFC. This never occurred and in fact, Ms. Ward subsequently tried to entrench herself and her supporters by filing the Change Notices in question;
d) Ms. Ward’s exhibit 3 to her affidavit recites that it was never the intention for SMFC to leave the MFL. However, minutes of February 24, 2010 clearly state that SMFC would have its lawyers send a letter informing MFL that SMFC was leaving the MFL; and
e) Ms. Ward obtained legal advice that the MFL’s dissolution of the executive of SMFC was not “legal”. That may be so. However, to use that to essentially re-take over the SMFC, including its money and assets, and threaten to break from MFL, the parent organization, was not the appropriate response.
[ 20 ] Some leeway must be given to these types of volunteer organizations when all of the corporate niceties have not been complied with. However, the issues became clear when both groups got legal counsel involved. It is not sufficient to now say, I didn’t know what I should have done.
[ 21 ] Given all of the issues before Ms. Ward, she did not have the authority to unilaterally change the corporate filings with the Ministry of Government Services. She made assumptions that certain persons shown on the public records were no longer directors. She should not have done so without either proper resolutions or written resignations. To assume the director resignations didn’t occur because of misspelled names is simply poor judgment. Ms. Ward also states that, at the February 24, 2010 meeting, a number of directors were removed because they were plaintiffs in a claim against Ms. Ward involving SMFC. That too is not a valid corporate reason and a poor excuse for proceeding in that manner. Ms. Ward explains some of the answers at the examination for discovery as deliberate confusion by opposing counsel. I don’t accept that.
[ 22 ] I am satisfied that the Change Notices submitted should be set aside as not being authorized by the proper corporate procedure. The court could not find a copy of SMFC’s organizational by-law or any by-laws. A properly constituted meeting should be called at which whatever incomplete corporate issues should be addressed and an executive properly appointed.
[ 23 ] The application is granted. An order shall issue in the form signed by me.
Costs
[ 24 ] The Applicants will provide written submissions within 3 weeks from the release of this decision. The submissions are limited to 3 written pages plus a bill of costs plus any authorities.
[ 25 ] Ms. Ward’s responding submissions shall be provided to me within 2 weeks thereafter. The submissions are subject to the same limits on length.
[ 26 ] There shall be no reply submissions without leave.
Ricchetti, J.
Date: April 2, 2012
COURT FILE NO.: CV-12-750-00
DATE: 2012-04-02
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Streetsville Meadowvale Football Corporation
BETWEEN: Rob Fields, Sherry Fields, Kevins Wils, Patricia Domaradzki, Lance Rampone, Kenneth Thom, Craig Morgan, John McTaggert and George Sturrock
Applicants
AND:
Claire Ann Ward
Respondent
BEFORE: Ricchetti, J.
COUNSEL: T. McLean, Counsel, for the Applicants
Claire Ann Ward, self represented
ENDORSEMENT
Ricchetti J.
DATE: April 2, 2012