



COURT OF APPEAL FOR BRITISH COLUMBIA




Citation:



McLachlan v. Trident Foreshore Lands
  Ltd.,









2010 BCCA 37




Date: 20100126

Docket:
CA036643

Between:

Ian
McLachlan

Appellant

(Petitioner)

And

Trident
Foreshore Lands Ltd., Christopher J. Barratt, Robert Bruce,

William
E. Ireland, Gordon R. Kleaman, James L. Mercier, and

Burrard
Yacht Club

Respondents

(Respondents)




Before:



The Honourable Mr. Justice Hall





(In Chambers)




On appeal from the Supreme Court of British Columbia, November 3,
2008,

(
Brown v. Trident Foreshore Lands Ltd.
, L051651)




Agent for the Appellant:



C.
  McLachlan





Counsel for the Respondent:



M.
  Pontin





Place and Date of Hearing:



Vancouver,
  British Columbia

December
  2, 2009





Place and Date of Judgment:



Vancouver,
  British Columbia

January
  26, 2010








Reasons for
Judgment of the Honourable

Mr. Justice Hall:

[1]

In this case, the applicant seeks an extension
of time to file a factum and appeal books.  Some history of the background of
this matter is set out in a judgment of this Court dated June 25, 2008 (
Struchen
v. Burrard Yacht Club
, 2008 BCCA 271, 46 B.C.L.R. (4th) 228):

[5]        Mr. McLachlan was a
long-standing member of the Yacht Club.  Historically, and while Mr. McLachlan
was a member, the Yacht Club was required to relocate from Coal Harbour to the
North Shore of Burrard Inlet.  As part of that relocation and to protect the
club from future dislocation, Trident Foreshore was incorporated.  It acquired
lands now occupied by the Yacht Club.  In order to finance the acquisition,
existing members purchased shares in the company.  New members of the Yacht
Club were required to purchase a share and an arrangement was made whereby the
shares of retiring members would be repurchased.  Thus, initially, all
shareholders of Trident Foreshore were members of the Yacht Club.

[6]        To supplement the Trident
Foreshore lands, the Yacht Club entered into a lease with a neighbour.  Today,
some docks are on the neighbours water lots and some are on Trident Foreshores
lots.  The terms of the lease with the neighbour have caused Mr. McLachlan,
as a member who experienced the earlier move, to have concerns about the
long-term security of the Yacht Clubs moorage.  This has been a factor in the
dispute which culminated in his expulsion from the Yacht Club.

[7]        In 1989, the rules as to
shareholding in Trident Foreshore were changed so that share ownership in the
company was no longer a condition of membership in the Yacht Club.  At that
time the Yacht Club began to acquire shares of the company.  Ultimately, corporate
governance issues arising from the change in ownership rules resulted in the
proceedings before the Supreme Court of British Columbia.  Reasons for
judgment, indexed as 2004 BCSC 1365 and 2006 BCSC 2036, explain some
of this dispute.  Mr. McLachlan was a party to those proceedings and
orders for costs were made against him.

[8]        It would be fair to say that the
corporate governance issues and the ensuing litigation both resulted from
acrimony and deepened that acrimony between Mr. McLachlan and certain
other members of the Yacht Club, including in particular the then Commodore, Mr. Mercier.

[9]        The dispute over the changes in
ownership of Trident Foreshore, the acrimony caused by the differing views of
the best way to secure the Yacht Clubs future, distrust and resentment
generated on both sides, and intemperate comments made during these events led
eventually to the expulsion of Mr. McLachlan from membership, bringing an
end to his long association with the Yacht Club and resulting in his loss of moorage
at the marina.  Clearly, in addition to his loss of membership, Mr. McLachlan
has lost a right (to moor his boat at the marina) that was an important element
of his social life and his family life.  As well, he was required to divest
himself of his share in Trident Foreshore because membership in the Yacht Club
was a condition of share ownership.

[10]      The process leading to Mr. McLachlans
expulsion started with a petition to the Directors signed by thirty members
asking for disciplinary procedures against members who had initiated the
Trident Foreshore lawsuit, those who signed an information circular in
respect to Trident Foreshore, and those who stood for election as Trident
Foreshore directors at an
ad hoc
Trident Foreshore takeover meeting.  The
Directors struck an investigative committee comprised of three past Yacht Club
Commodores, to decide if members who had contested the Trident Foreshore share
issues had violated the bylaws.

[11]      The investigative committee made
enquires, but did not receive input, oral or written, from any of the three
members ultimately disciplined by the Board.  The committees report detailed
findings in respect to the share dispute and concluded that Mr. McLachlan
and his two co-petitioners had conducted themselves in a manner which most
seriously and injuriously affected the well being of individual members and
threatened the very survival of the Yacht Club.

[12]      The Board of Directors
received the report of the Investigative Committee on May 4, 2005, and resolved
to proceed with charges.

[2]

Mr. McLachlan and another member were
ultimately expelled from membership in May 2005.  On an appeal to the Club Membership
in June 2005, a vote of members disclosed a majority were opposed to
reinstatement of those expelled.  A petition was filed in Supreme Court by Mr. McLachlan
seeking to quash his expulsion and order his reinstatement.  A chambers judge
refused this relief but this Court reversed and made an order quashing the
expulsion and ordered reinstatement on the basis that the petitioner, Mr. McLachlan,
had not been afforded a fair hearing.  Although the petitioner was reinstated,
he apparently did not obtain the moorage position he earlier had possessed. 
Further proceedings followed including the present matter which was one of two
decided by Pitfield J.  It appears certain proceedings instituted earlier
had not proceeded to resolution until the petition about expulsion was
resolved.

[3]

Pitfield J. observed at paras. 2 and 3
of his Reasons of November 4, 2008:

[2]        The petitioners Peter Brown, Ian
McLachlan and Alfred Struchen apply for the relief set forth at paragraphs (d)
and (e) in petition L041335, namely, an order that the board of directors
elected at the special meetings of the shareholders of Trident Foreshore Lands
held on April 22, 2004 are the directors of Trident until the next annual
general meeting; and (e), in the alternative, if the board of directors elected
at the special general meeting of shareholders of April 22, 2004 are not the
duly elected board of directors of Trident, that Trident hold a meeting to
elect directors of Trident under the supervision of a court-appointed
representative in accordance with the articles of Trident as at November 6,
2003, and the parties entitled to vote being the shareholders of Trident as at
November 6, 2003.

[3]        By
way of overview, I will say that on July 18, 2006, I dismissed the prayers for
relief set forth in paragraphs (a) through (c) of the petition on the grounds
that the subject matter of those requests for relief had been dealt with by
Madam Justice Ross in a proceeding to which I will make reference in due
course.

[4]

The judgment of Ross J. was delivered on
October 25, 2004 and is indexed as 2004 BCSC 1365.  In this judgment, Ross J.
had granted orders sought by the petitioner, Trident Foreshore Lands Ltd.  I
have had an opportunity to read that judgment.  Pitfield J. concluded his
November 4 reasons as follows:

[34]      At the meeting of April 22, 2004,
as I believe I previously indicated and if not I will state, Messrs. Brown,
Struchen, McLachlan, Ellis and McMahon were elected or purportedly elected as
directors.  I conclude that that election of directors did not proceed at a
meeting which was lawfully convened in the manner contemplated by the
Business
Corporations Act
and the articles of the company.  The resolution was of no
force and effect and those individuals were not lawfully elected as directors
on April 22, 2004, or indeed at any other time.  It follows that the
application for relief in paragraph (d) of the petition is dismissed.

[35]      The next claim for relief is that
the court order the conduct of a meeting which will be directed to the election
of directors in conformity with the articles as they existed at November 6,
2003.

[36]      In my opinion, that application
cannot proceed and must be dismissed.  Events subsequent to November 6, 2003
have overtaken any deficiencies in the conduct of the vote to elect directors
at November 6, 2003.  Firstly, certain acts of the directors purportedly
elected on that date have been validated first by Madam Justice Ross who
validated the transfer of shares by Burrard Yacht Club to a number of its
members, transfers which were approved by Trident; and secondly, by a meeting
of the shareholders of Trident on November 26, 2004, which was properly
requisitioned by members pursuant to s. 167 of the
Business
Corporations

Act
, the conduct of the meeting on that date, the
adoption of the three resolutions to which I have already made reference, the
fact that McLachlan, Brown and Struchen were in attendance and have taken no
steps in any way, shape or form to challenge that which was done on November
26, 2004, properly convened meetings have lawfully elected directors in
accordance with the amended articles of the company.  No challenge has been
mounted and the resolutions remain valid and binding.

[37]      It
follows that the board now in place, by that I mean the directors other than
Brown, McLachlan, Struchen, McMahon and Ellis, has been lawfully elected by
those entitled to vote in accordance with the articles of the company as
amended, and there is no justification whatsoever for concluding that any of
Brown, McLachlan, Struchen, McMahon or Ellis is now or ever has been a lawfully
elected director of Trident Foreshore Lands Ltd.

[5]

On November 3, 2008, Pitfield J. delivered
Reasons in Docket Number L051651, a petition that had been stayed pending
resolution of other proceedings.  In this proceeding, the petitioner, Mr. McLachlan,
apparently sought relief under various heads, including s. 227 of the
Business
Corporations Act
, S.B.C. 2002, c. 57.  This is sometimes termed the
oppression section of the
Act
.  Those claims for relief were dismissed
by Pitfield J. on the basis that the relief sought could not be granted
under the provisions of the statute.  Also, Mr. McLachlan had sought
relief under provisions of the
Company Act
, S.B.C. 1999, c. 27.  As
to this, Pitfield J. said:

[30]      The
next item is a prayer that the court direct an investigation to be made under
Division 3 of the
Company Act
, S.B.C. 1999, c. 27.  There is no
evidence before me which suggests in any way, shape or form that any
investigation is required.  The sole issue in dispute is a difference of
opinion and philosophy as to the manner in which the affairs of the Yacht Club
and Trident should be conducted.  As I have said in the course of Ms. McLachlans
submissions, there is no claim to be advanced under s. 227 of the
Business
Corporations

Act
, unless it appears that the board has been acting
to the detriment of Mr. McLachlan as a shareholder or member, as opposed
to acting in a manner which he may regard as non-beneficial from the point of
view of all members, unless of course there is some element of self dealing of
which there was no evidence.

[6]

In the present appeal from the dismissal of the
petition ordered by Pitfield J. in his reasons of November 3, 2008, the
appellant seeks the following relief:

136.     An investigation be made under
Division 1 of the Companies Act from 1989 to the present with special emphasis
on the details of compliance with the BC Securities Act on how the take-over
was accomplished by BYC; how the company, Trident Foreshore Lands Ltd., was
made a subsidiary of BYC, a nonprofit society, and how the assets were
transferred from TFL to BYC when BYC, being a society, cannot have a capital
divided into shares.

137.     All costs: legal, personal,
substitute moorage, damages to boat due to being without a shelter, and other
related expenses that would not have been incurred but for the prejudice and
oppression carried out to justify expelling Mr. McLachlan, Mr. Struchen
and Mr. Brown from BYC for the express purpose of ridding the petitioners
of their shares and shareholders rights.

138.     All members of BYC and shareholders
of TFL are to be advised by letter and in the Trident newsletter that the
expelled members of BYC had not committed the acts of which they were accused,
that the Court of Appeal had set aside Justice Edwards order, and Ian
McLachlans membership was reinstated with all privileges, seniority and
moorage.

139.     Damages
for pain and suffering, not just to himself, his wife, (co-owner of the Sunny
Seas), but also his beloved granddaughters, who are both Intermediate members
of BYC and need their grandfathers name to be cleared and the truth known to
all.

[7]

The respondents submit that the application for
extension of time ought not to be granted because the materials should have
been filed in the Spring of 2009 and there has been unjustifiable delay.  They
also submit that the appeal has no prospect of success and that the application
for an extension of time to file material should be dismissed.  As set forth in
Davies v. Canadian Imperial Bank of Commerce
(1987), 15 B.C.L.R. (2d)
256 (C.A.), on an application for extension of time, a judge must consider
whether the extension will prejudice a respondent and whether the appeal has
merit, that is, some possibility of success.

[8]

These factors are to be considered in deciding
whether it is in the interests of justice that an extension of time be granted
to perfect an appeal.

[9]

I may say that if I concluded that this appeal
proceeding had any possibility of success, the delay factor would not militate
against granting an extension of time.  While delay is not to be encouraged,
the delay here of some six or seven months is not what I would view as
inordinate.  As well, in my view, the appellant has in argument set out a
series of events that accounts for much of the delay in preparation of
materials.  Thus, I would not accede to the submission of the respondents that
the application for an extension of time to file necessary material to perfect
the appeal should be refused on the basis of delay on the part of the applicant.

[10]

I have had a full opportunity since the hearing
of this application to review the material and previous decisions in related
proceedings.  The factum of the applicant appellant sets out in considerable
detail a comprehensive history of disputes between the appellant and
respondents.  It is clear to me on reviewing what is sought to be filed that
there is no possibility that a division of this Court could or would grant any
of the relief sought by the appellant on this appeal from the judgment of
Pitfield J.  In such circumstances, it is my considered view that it would
not be in the interests of justice to grant an extension of time to file
material.  As Kirkpatrick J.A. observed in
Westbank Holdings Ltd. v.
Westgate Shopping Centre

Ltd.
, 2009 BCCA 370, If the appeal is
bound to fail, then that is a good reason for refusing an extension of time. 
The application for an extension of time to file material is accordingly
dismissed.

The Honourable Mr. Justice Hall


