3 There are, on the other hand, certain proposed changes which we oppose: Section 35, Reporting Under this proposed section the society's auditor would, be required to disclose the remuneration paid to the society's directors, and to its employees and contractors, where those payments exceed the amounts shown in the regulations. While it is difficult to measure the impact of this proposed section without knowing the contents of the proposed regulations, we are concemed that this provision will unnecessarily add to the time and expense of the annual audits. Such audits are required for all B.C. student societies as a condition for fee collection and remittance, pursuant to the applicable legislation 1 , with the result that members of student societies are already provided with detailed financial information showing the amount of payments to directors and staff. Section 66, Termination of Membership The draft Act sets out what might appear to be an innocuous provision by which a person's membership in the society terminates, "when the member resigns or dies". For convenience of reference, the draft section states: 66. (1) A Member's membership in a society is terminated when (a) (b) (c) (d) the member's term of membership, if any, expires, the membership is terminated in accordance with the bylaws, the member resigns or dies, or the member is expelled in accordance with the bylaws or under section 67(2). (2) Unless the bylaws provide otherwise, the rights of a person as a member of a society, including any rights in the money or other property of the society, cease to exist when the person's membership in the society is terminated. The explanatory text following the proposed language begins by stating that, "(t)his section is for clarity. It lists the circumstances in which a member ceases to be a member ... ". Nonetheless, our concern is that this provision may become the unintended vehicle for an attack on the principle of mandatory membership, a fundamental element in the successful operation of student societies. Currently, all students attending B.C. post-secondary institutions governed by the University Act and the College and Institute Act are ipso facto members of the applicable student society. That is because the bylaws of the student society provide that students become members upon enrolling in a course of studies at the institution, 1 The University Act s. 27.1 (4) or the Col/ege and Institute Act, s. 21 (4) FIN-2014-00299 Page 4 4 and they remain members for so long as they are students at the institution. There is typically no right for students to resign from membership in the society. Student Society fees are collected by the institution, along with tuition fees and other levies, and remitted to the student society in accordance with the legislation noted at footnote 1, above. There is no legal option for a student to "opt out" of membership in the student society. It is well established that this system of mandatory student society membership as a condition of university or college enrolment is lawful. The B.C. Court of Appeal affirmed this point in Feldhaus v. British Columbia 95 B.C.L.R. (2d) 382, decided in 1994. The current Society Act contains no provision addressing membership termination. However, it defines a "member" as being an applicant for incorporation, and "every other person who becomes and remains a member in accordance with the bylaws". The implication is that the matter of membership termination is governed entirely by the bylaws of the society. By contrast, the proposed new provision in s. 66 is open to the interpretation that there is an independent, free-standing right to resign from membership in a society, apart from whatever the bylaws may provide. In the case of student societies, it might be argued that even if the bylaws made membership mandatory, there would still be a right of resignation given by s. 66(c) of the Act. On this basis, it might be argued, a student who had resigned would have no obligation to pay student society fees, and the institution would have no right to collect such fees from the student. On every campus there are a few students who object to having to pay student society fees. While it is doubtful that a court would accede to the argument that the wording of the proposed s. 66 was intended to open the door to a challenge to mandatory membership, the provision might still be an invitation to litigation. One simple remedy would be to change the current draft subsection (b) of s. 66, so that it stated, "the membership is terminated, or the member resigns, in accordance with the bylaws". Subsection (c) would simply state, "the member dies, or... ". This would mean that the right, if any, to resign from the society would continue to be governed by the bylaws. A simple alternative would be to exempt student societies from the effect of the proposed new provision. Section 98, Complaints by Members This section would be in addition to the proposed retention of the former s. 85 of the Act, (now s. 102 in the White Paper), under which the court is given a wide power to correct errors, defects, omissions or irregularities in the conduct of a society, including contraventions of the Act or defaults in compliance with the bylaws. The White Paper's explanatory notation to section 98 acknowledges that some critics of the proposed provision have made the point that "even if there is a need for such a FIN-2014-00299 Page 5 5 remedy, it should not be available where the directors are acting in furtherance of the society's purposes". While recognizing that a society may legitimately have to prefer some interests over others, or apply the society's funds for one purpose over another, the authors of the White Paper nonetheless assert that such a qualification could "severely restrict the usefulness of the remedy". We agree with the concern expressed by the critics of the proposed provision. With the retention of the current s.85 society members will continue to have a full range of remedies for negligence and misconduct in the operation of a society, and the addition of the "oppression rernedy" would be simply an invitation to nuisance litigation. We submit that it is difficult to imagine a situation in which a society that is acting in accordance with its constitution and bylaws, and within the Society Act, could at the same time be acting oppressively. Section 99 - Complaints by public Our concern with this proposed addition to the Act is similar to our concern arising from the proposed s. 98. Under the draft s. 99, a member of the public, whom the court considers to be "an appropriate person to make an application", could apply to court for a remedy against a society, where it is shown that the society has acted in a fraudulent or unlawful manner, or was carrying on activities that were "detrimental to the public interest". Any conduct on the part of a society that amounted to acting "in a fraudulent or unlawful manner" could be remedied under the current s. 85 of the Act. Our concern is with the vagueness and generality of the term, "detrimental to the public interest". We think that such a provision would have no realistic application to student societies, and would simply be a lure for nuisance litigants. In the explanatory notes to the proposed provision, the authors acknowledge the possibility of vexatious litigation, but they state that the risk "is limited because the court effectively controls the process". This last statement is, in our view, wholly unrealistic. Experience has shown repeatedly that the courts have, in practice, very limited means to control nuisance litigants until very substantial cost and inconvenience has been inflicted on innocent parties. From time to time student societies have been required to take positions on controversial issues of concern to the public. For example, student society decisions on whether to charter anti-abortion clubs have generated administrative tribunal complaints and lawsuits against student societies from certain of their members. The same is true of the issue of mandatory membership in student societies. Our concern is that the expression "detrimental to the public interest" in the proposed s. 99 is so broadly drawn as to encourage vexatious litigation. Nowhere in the paper is the term "public interest" defined. In any event, student societies are not designed to serve the "public interest", but rather, the interests of their FIN-2014-00299 Page 6 6 members. While we note that the commentary to the draft s. 99 refers to the fact that many societies are supported through public funding, student societies are funded entirely by their members. At the least, our view is that student societies should be exempt from this provision. Such societies are already made subject to the requirements of s.27.1 of the University Act, and s.21 of the College and Institute Act, to maintain and disclose current audited financial statements and to remain in good standing as a society, as conditions for fee collection and remittance. In addition, they would remain subject to the current s.85 of the Society Act. Thank you for giving these matters your consideration. FIN-2014-00299 Page 7