Society Membership Criteria: A Reminder From The BC Court Of Appeal On The Importance Of Clear Bylaws

• Published date: 26 November 2020
• Subject Matter: Corporate/Commercial Law, Litigation, Mediation & Arbitration, Charities & Non-Profits , Directors and Officers, Trials & Appeals & Compensation
• Law Firm: Clark Wilson LLP
• Author: Ms Raman Johal, Areet Kaila and Julia Tikhonova

The recent decision of Farrish v Delta Hospice Society, 2020 BCCA 312 ['Farrish'] confirms the significance of properly adhering to bylaws for societies under the Societies Act [the 'Act'], as well as the consequences of failing to do so.

Farrish involved an appeal of a decision under the Act that 310 membership applicants had been improperly rejected by Delta Hospice Society ['DHS'], a non-profit society that provides palliative care and support to persons in the last stages of living. Following a change in its Board of Directors in 2019, DHS suspended offering medical assistance in dying ['MAiD'] on its premises. DHS subsequently set an annual extraordinary meeting for the purpose of changing its constitution and bylaws to represent the Board's anti-MAiD views and the religious principles of DHS. Prior to this meeting, DHS granted membership to applicants who held anti-MAiD views, but simultaneously rejected 310 applications from those seen as pro-MAiD or potentially pro-MAiD. The chambers judge held that the Board had acted contrary to the 'open' membership contemplated by DHS's bylaws, which gave no discretion to screen applicants. Furthermore, the directors' actions were improper and lacked good faith.

The Court of Appeal evaluated the applicable bylaw of DHS, which states that 'a person may apply to the directors for membership ' and on acceptance by the directors is a member.' This bylaw neither gives discretion to screen and reject applicants for membership based on their views toward MAiD, nor does it set out acts or omissions of members that might constitute a 'failure to uphold the Society's purpose.' In the words of Madam Justice Newbury:

[88] ' In the absence of clear and specific provisions in the Constitution and Bylaws, it was not for the Directors to apply their own private criteria to keep out others who think differently than they. Like all societies under the Act, the Society is governed by majoritarian principles and is not frozen in time. '

[89] Of course the Society is a private body in the sense that it is not an agency of government, and membership is voluntary in the sense that it is not required by law. But this does not signify that the Directors are, under...