A bare-bones transition is detailed here, here, and here. If you want to transition as a member-funded society, you must have a special resolution of the members to do so. If you do not, no worries. You can bring a simple court application at a future date.

If you’re wondering why be an incorporated society, and why it’s worth not being struck from the register, read this post here.

Photograph by A. Davie under a Creative Commons license. No changes were made to this image.

On May 7, 2018, the Civil Resolution Tribunal Amendment Act passed third reading, with its changes to come into force by regulation at a future date. The Civil Resolution Tribunal (“CRT”) is effectively a new Small Claims court, where certain low-value disputes are downloaded to lawyers rather than judges, and parties must represent themselves without a lawyer, absent some exceptions. The majority of claims are to be considered by way of written submissions, with a judicial review being available to the BC Supreme Court in chambers if the tribunal member made an error of law, fact, or mixed fact and law.

The idea behind the CRT is laudable: make the process easy, fast and affordable for individuals for low-value or low-complexity claims, and get them out of the court system to free up judicial resources. The CRT to date has been used for smaller debt matters and strata claims. However, the new amendments make a number of changes, outlined in this Canadian Bar Association position paper and were developed and read without a detailed consultation period. You may have heard of these changes, particularly those which involve the Insurance Corporation of British Columbia and low-value motor vehicle claims.

One of the changes, almost as an after thought, is to send certain issues relating to member discipline, interpretation of society bylaws, and production of society records to the CRT rather than the BC Supreme Court, which previously had exclusive jurisdiction over such issues.

The concerns with this new jurisdiction are the following:

• There will be an increase in Societies Act claims. At present, Societies Act claims have to go to BC Supreme Court Chambers, meaning there are court costs (typically $1,500 or more to start) as a penalty for loss and legal fees associated with bringing such a claim as a petition (probably $2,500 to $7,500 or more depending on the lawyer and the nature of the hearing). This means most disputes are resolved early on through letter writing and negotiation, rather than heading straight to court. Now, most claims will go straight to the CRT with little or no costs consequences associated with them (whether or not the CRT has jurisdiction).
• There may be potentially incorrect precedent generated. Lawyers are not permitted, without special leave, meaning that complex societies legal issues may be left to lay-person interpretation, going before a tribunal with an incomplete legal record of Societies cases. Societies law is a mix of administrative and corporate (rather than than strata) law. I do not doubt that trained CRT members will do well with these files, however, the best way to inform a tribunal or court is to have a well drafted legal basis available. Without legal advice, parties may be left (or the tribunal member may be left) to research their own case law and may make significant errors, which are doomed to be repeated. Of course, this may also lead to ghost-written precedents by lawyers, provided to societies as backgrounders for independent claims.
• Danger of missing an issue or an incomplete record for appeal. Hearings are primarily in writing, with only a judicial review on patent unreasonableness available to the BC Supreme Court. This is not a fresh hearing before a judge. No new evidence may be introduced, and the appeal is on the record. Specific errors must be found in the decision; such errors must be determined to be “patently” unreasonable, not merely unreasonable, meaning there is potentially (though perhaps not practically) room for more error in the decision making process. This standard of review is too narrow for my liking.
• The jurisdiction is unclear. It is unclear which claims will be accepted by the tribunal. Under the proposed language, it would appear the tribunal has jurisdiction over something less than oppression and member discipline claims, but does not have jurisdiction over those explicitly. Viewing the provisions below, what does the tribunal have jurisdiction over? It would appear it has a very limited jurisdiction in relation to disputes that are not oppression (e.g. something less than unfair prejudicial or oppressive actions); small value actions by the society or against the society for debt or damages; and disputes regarding records (and likely the extent of disclosure) that do not follow the procedure for disclosure of records set out in the Societies Act. Is this then some sort of attempt to resolve disputes that would normally be dealt with internally, or where there was no court remedy available (e.g. such as where the contemplated action was not oppressive, but there was no formal process for dealing with it at the society)? We will see how the jurisprudence develops.
• Society resources will be stretched. Most voluntary organizations will not be equipped to deal with these claims, which appear to be able to be brought when even a perceived decision is brought. This is concerning, as representation (even student-at-law-representation) may be prohibited by the tribunal. I assume unbundled legal services will fill-in the gap, with claims being prepared by legal counsel in an almost cookie-cutter fashion, and then being argued by staff, as happens with insurance related claims now.

The relevant sections of the amending act are below:

Claims within jurisdiction of tribunal for society claims [To be inserted into the Civil Resolution Tribunal Act]

129  (1) Except as otherwise provided in section 113 [restricted authority of tribunal] or in this Division, the tribunal has jurisdiction in a dispute over a claim, in respect of the Societies Act, concerning one or more of the following:

(a) the interpretation or application of the Societies Act or a regulation, constitution or bylaw under that Act, including a request to inspect, or to receive a copy of, a record of a society;

(b) an action or threatened action by the society or its directors in relation to a member;

(c) a decision of the society or its directors in relation to a member.

(2) For the purposes of this Act, the tribunal is to be considered to have specialized expertise in respect of claims within the jurisdiction of the tribunal under this Division.

Who may request resolution by civil resolution tribunal [To be inserted into the Societies Act]

109.2  (1) A society, or a member of a society, may make a request under section 4 [asking the tribunal to resolve a claim] of the Civil Resolution Tribunal Act asking the civil resolution tribunal to resolve a dispute concerning a society claim.

(2) A person [NB: a non-member], other than a person referred to in subsection (1), who claims

(a) to be entitled, under section 24 [inspection of records] of this Act, to inspect a record of a society,

(b) to be entitled, under section 27 [copies of records] of this Act, to receive a copy of a record of a society, or

(c) to be entitled, under section 28 [copies of financial statements] of this Act, to receive a copy of a record of a society

may make a request under section 4 of the Civil Resolution Tribunal Act asking the civil resolution tribunal to resolve a dispute concerning a society claim that relates to the person inspecting or receiving a copy of the record.

(3) A person may make a request in accordance with subsection (1) or (2) whether or not the person has applied to the registrar for an order under section 107 [registrar or court may order access or copies] of this Act.

(4) Nothing in this section or the Civil Resolution Tribunal Act limits a person’s right to apply to the registrar for an order under section 107 of this Act.

(5) A request under section 4 of the Civil Resolution Tribunal Act may not be made with respect to any matter relating to the termination of membership in a society.

Certain claims are beyond the jurisdiction of the CRT.

Claims beyond jurisdiction of tribunal for society claims [To be inserted into the Civil Resolution Tribunal Act]

130  (1) The tribunal does not have jurisdiction under this Division in relation to a claim that may be dealt with, by the Supreme Court, under any of the following provisions of the Societies Act:

(a) the following provisions of Part 5 [Management]:

(i) section 44 (3) [persons qualified to be directors];

(ii) section 58 [validity of contracts];

(iii) section 59 [directors’ liability for money or other property distributed];

(iv) section 65 (2) [indemnification or payment prohibited];

(b) section 80 [powers of court respecting general meetings];

(c) Part 8 [Remedies]

[Note: As of this writing, Part 8 [Remedies] includes ss. 102 to 106, which include the oppression remedy for disputes between members and the society; derivative actions which allow interested individuals to bring claims on behalf of the society, when it can’t do so in its own name; compliance / restraining injunctions to force compliance with bylaws; court’s power to remedy irregularities in a society’s affairs (the most common court application); and indemnification/relief in legal proceedings; as well as ss. 107 to 109, disputes regarding records];

(d) the following provisions of Part 12 [Special Societies]:

(i) section 193 [altering constitution to become member-funded society];

(ii) section 194 [other restrictions on becoming member-funded society];

(iii) section 205 [injunction].

(2) The tribunal does not have jurisdiction under this Division in relation to a claim that is in respect of any of the following matters or provisions of the Societies Act:

(a) a matter relating to the termination of membership in the society;

(b) a matter relating to the liquidation, dissolution or restoration of a society, including under Part 10 [Liquidation, Dissolution and Restoration], except section 143 (1) (b) [duties of liquidator];

(c) Part 7 [Corporate Reorganizations];

(d) Part 9 [Audit].

(3) The tribunal does not have jurisdiction under this Division in relation to any of the following:

(a) a claim that is an appeal of a direction, decision, order, ruling or refusal of the registrar;

(b) a claim to which Part 5 [Resolving Disputes] or 5.1 [Administrative Penalties] of the Residential Tenancy Act applies or Part 6 [Resolving Disputes] or 6.1 [Administrative Penalties] of the Manufactured Home Park Tenancy Act applies;

(c) a claim to which all parties have agreed that the Arbitration Act will apply.

Photo by Andrew Raun. Used under a Creative Commons license. No changes were made to this image.

Masters and Judges

A “Master” is a deputy judge in Supreme Court, empowered to do the day to day hearings which judges do not have time for. In general, Masters are able to grant any relief which isn’t final, also called interlocutory relief. In Societies Act terms, this would be things like a document production motion, conversion of a petition into an action, or seeking an urgent interlocutory injunction or compliance with bylaws order.

A “Provincial Court Judge” is a statutory judge in Provincial Court, which includes Small Claims. These judges can hear claims for debt, damages, or property from $5,001 to $35,000. Anything below that typically must go to the Civil Resolution Tribunal (“CRT”). Most societies claims, other than for small debt disputes, would never go to the CRT, or even the Provincial Court.

A “Supreme Court Judge” is a judge in the British Columbia Supreme Court. Such judges are empowered by the Societies Act to grant final relief in certain matters, as well as with certain additional discretion. This is who applications to remedy irregularities (s.105), oppression actions (s.102), record correction actions, appeals from non-disclosure of financial information, appeals from decisions of the Registrar, and applications for member-funded status should be directed to.

A few cases deal with these jurisdictional issues:

• In Brienza & Others v. De Vita & Others, 2003 BCSC 1820, a request was made before a Master to strike one slate of directors and replace it with another one. After an analysis determining that a Master does have jurisdiction to hear certain claims, the Master determined that the relief sought was a form of final relief and could not be heard (at paras 10-12).
• In PG Farmers Market v. Stojkovic, 2015 BCPC 389, the PG Farmers Market filed a Small Claims action against a former secretary, seeking recovery of property. The secretary had counter-claimed in Small Claims (a separate action heard at the same time as the original action), seeking damages, not reinstatement. Reinstatement would be a s.85 Society Act/s.105 Societies Act remedy, which would rest only with the Supreme Court (at para 4 to 6). However, the Small Claims judge determined there was no jurisdiction in Small Claims to determine if a breach of the bylaws had occurred to even award damages, and this claim had to be heard in BC Supreme Court.

Jurisdiction of the Civil Resolution Tribunal

Recent changes to the jurisdiction of the Civil Resolution Tribunal may also lead to claims being heard in front of tribunal members, rather than judges. Such claims include any interpretation or application of the Societies Act, its regulations, constitution, or bylaws; requests to inspect or copy a record of a society; an action,  threatened action, or decision by the society or its directors in relation to a member (other than termination). This is expressly not oppression claims (under the new s.130(1)(c) of the Societies Act), so what the scope of disputes within the jurisdiction of the CRT is unclear. The society may also request resolution of a dispute at the CRT, though the extent of what it may request is not specifically defined in the legislation.

The CRT specifically cannot deal with claims relating to director or senior manager qualifications, liability for money or other distributed property, or indemnification; validity of contracts; powers respecting general meetings; injunctions for contravening bylaws; member-funded society issues; reorganizations, winding-up, and audit; oppression (s.102 claims); derivative actions (s.103 claims); remedying irregularities (s.105 claims, formerly s.85 Society Act claims) and strangely, claims to which the Arbitration Act applies — Which leads me to wonder: Can a society require members to submit to arbitration for their disputes to avoid the CRT and Supreme Court? It would appear so.

It remains to be seen what claims will go before the CRT, as the amendments to the Societies Act and the Civil Resolution Tribunal Act are not yet in force (as of July 2018).

Photo by dvdmnk, used under a Creative Commons License. No changes were made to the original. 

Basra v. Shri Guru Ravidass Sabha (Vancouver), 2017 BCSC 1696 (Branch J)

Reading this case is overall a great entry point into Societies Act disputes due to its summary of many cases and multiple complaints from members. It also stands out for concisely stating the following principles:

• Directors must always act fairly, even in the absence of an express obligation in the society bylaws to do so. It is never in the best interests of the society to act unfairly (at paras 62-63);
• A duty to act fairly arises in a membership drive, including in establishment of an election committee and in analyzing membership applications (at paras 65-66);
• Where a long-term member is to be deprived of membership, either through the non-renewal of membership or through termination, a hearing must be held to provide a proper foundation for such a decision (at para 84, 91);
• The principles of contractual interpretation apply in reading bylaws, which includes that parts of the bylaws must be interpreted in the context of the intentions of the parties as evident from the bylaws as a whole (para 64, citing Bhandal v. Khalsa Diwan Society of Victoria, 2014 BCCA 291 at para 25-29);
• Member expulsion decisions and complaints should be deal with within a reasonable time. Where a Society takes no active steps with regard to offending behaviour until long afterwards (in this case, more than six months), the failure to address the issue promptly is a denial of natural justice. It may also require, depending on the importance of the membership to the individual (in this case, religious identity), some evidence advanced to show a full and proper consideration by the decision maker. This includes comprehensive reasons (at paras 83, 88, 93);
• Where a society has a specific provision for the expulsion of members, but chooses not to invoke it at the time the dispute arose, and instead chooses an alternative route to expel a member, the failure to adopt the most logical tool available to the society colours the membership renewal process and is a breach of procedural fairness (at para 83).

Bjorknas v PBC Health Benefits Society, 2017 BCSC 2464 (Mayer J.)

This case summarizes the following:

• Section 81 of the new Act allows Special Resolutions, which include those for removal of members or directors, to be placed on the agenda of a scheduled members meeting by a 5% signature requirement of the membership (at para 4);
• Though the bylaws can set a lower threshold than 5%, there is no requirement on a society with a large membership that the directors consider this point, or insert such a provision into the bylaws. It does not result in wrongdoing to rely on the language of the new Act and the court will not legislate a lower threshold (at para 10, 11, 13, 15)
• The appropriate remedy where a subset of members disagree with the bylaws as written or an action of the board is to participate in the democratic process and vote for a new executive, when this is available to them (at para 15, 16); and
• The member-funded statement in a society’s constitution does not automatically give rise to a need for directors to operate the society in the interest of only a small subset of the membership — it is a statement under the new Act and not a “purpose” (at para 6, in argument, and in statutory language).

Nisga’a Lisims Government v Nisga’a Valley Health Authority, 2017 BCSC 2363 (Burke J)

In this case, a society rendered a vote by a Robert’s Rules method called “general consent”, whereby the chair of the meeting asks if there is any opposition to a motion on the floor. If no member speaks up, the motion carries unanimously. If there is even a single voice in opposition, the motion goes to a vote. This method was used for a Special Resolution. Most votes of the society in the past were done by show of hands. After the close of the meeting, concerns were raised as to whether a vote had properly been conducted.

The actual method of voting by general consent was not called into question; instead, due to the length of the meeting, it was potentially unclear whether the membership knew what it was voting on at the time debate was closed and the Special Resolution was put to a vote. The Court reviewed the record, and determined that the method of voting was determined at the beginning of the meeting, was discussed throughout, and a reasonable period of time was given for voicing dissent to the voting method. No objection was voiced, and the Special Resolution passed unanimously. The Court exercised its power to remedy irregularities and concluded the Special Resolution was validly passed.

Image by MigelB used under a Creative Commons Share and Adapt license. No changes were made to this image.

This article provides the basics of who needs to transition, what they should be doing now, and what needs to be done on transition.

WHO NEEDS TO TRANSITION

Transition applications must be filed by organizations incorporated in BC under the Society Act (the old Act) and those organizations extra-provincially registered to operate in BC, such as a society/not-for-profit incorporated in another province or a Canada Not-for-Profit Corporation.

If your organization is not extra-provincially registered to operate in BC, you do not need to transition.

Whether a “Special Act Non-share Corporation” — that is, an organization incorporated under another act (for example, a university or hospital) — needs to file a transition application is outside the scope of this post.

WHAT TO DO RIGHT NOW

Nothing other than some housekeeping. Societies have two years under the new Act to transition (i.e. November 28, 2018).

Instead of rolling around in a flop sweat, view this time as an opportunity. Perhaps appoint a small committee or workshop with members and directors to conduct a strategic review of your society’s operations. Consider your current bylaws: are they servicing your organization? What needs to change?

For example, you should consider:

• Are there senior managers in your organization, and if so, what directors’ duties should be delegated to them;
• Who are your directors? Do they meet the qualifications now set out in the Act and Regulations? Does the structure need to change?
• Are there unalterable provisions which are sticking points among members or your funding is contingent on?
• What provisions of the New Act conflict, and what are the benefits of the New Act to your organization?
• What are your procedures for election and removal of directors? What are your procedures for director, member or senior officer discipline?
• Who is your membership — do you have numerous ex officio members, and do you need different classes of membership?
• Where will society records be kept, and who should have access to them?

Doing such strategic planning with a view of the provisions of the new Act will assist your organization with the transition process.

WHAT NEEDS TO BE DONE ON TRANSITION

Transition applications will be completed online. The process for transitioning for most will include altering their constitution and bylaws to comply with the New Act. The New Act does not allow the constitution to contain anything other than the society’s purposes, and the New Act may make existing bylaw provisions unenforceable or unnecessary, depending on your organization.

Before transition:

• All annual reports must be up to date and filed with the Corporate Registry; if not, the society cannot transition; and
• the Statement of Directors and Registered Office should be the most up to date and accurate as possible.

On transition:

• Anything other than your society’s name and purposes (word for word) must be moved from the constitution into the bylaws;
• If reusing the prior bylaws, the bylaws must be a complete set (i.e. the original set of bylaws, updated to include any amendments to the original set filed with the Corporate Registry) and must be word-for-word what appears in the Registry; and
• The bylaws must identify any unalterable provision as being “previously unalterable”.

There is no need to hold a general meeting or a vote in order to perform the above changes for a transition application.

A society may choose to make changes to its bylaws on transition. This must be approved by special resolution of the members. If approved before November 28, 2016, it requires a 3/4 vote; if on or after November 28, 2016, a 2/3 vote is required. Note that new bylaws also require unalterable provisions to be marked as “previously unalterable”.

Bylaws may be amended either on transition or thereafter (for a $50 fee).

MORE INFORMATION

For more information on transition, the Registry of Companies released a free transition guide on April 15, 2016.

I have also provided a simple plan on the transition process, while the People’s Law School of Vancouver has a detailed guide available online.

I have also blogged on senior managers, unalterable provisions, member-funded societies and other issues.

Photograph by A. Davie under a Creative Commons license. No changes were made to this image.

In its FAQ of September 2016, BC Registries stated:

Q: Can a member-funded society apply for a gambling event licence?

A: Yes. A gambling event licence may be issued to a member-funded society only if the funds raised at the event will be used by the society to provide direct community benefit and/or will be given to a third party whose services provide direct community benefit within BC.  Organizations holding events that fall within the latter category must receive a letter of endorsement from the third party whose services provide direct community benefit within BC.

Those interested in obtaining more information on Gaming Branch requirements may contact the Branch at 250-387-5311, or at 1-800-663-7667, or at Gaming.Branch@gov.bc.ca.

Photo by Yohann Legrande, used under a Creative Commons License. No changes were made to this image.

A WORD OF CAUTION

This presentation was made in July 2016 in an informal setting by BC Government staff. It should not be taken as legal advice, but merely somewhat helpful guidance provided by public servants. The best source of information on transition is the Registry’s Transition Guide, available online, or through consulting a trained British Columbia lawyer who practices in societies.

That said, the presentation did provide some information on the upcoming online system to be introduced by the Registry, and it worth considering as a society prepares for transition.

NEW ONLINE SYSTEM

The new system will be used for the majority of filings. There will be a revision history, showing which BCeID changed what, and an ever-green copy of the bylaws. Payments can be made either by pre-authorized debit or credit cards. Certified copies of documents are available by logging in to the system and downloading specific PDFs.

ONBOARDING – OCTOBER NOVEMBER 28, 2016

Prior to transition, each society must “onboard” into the new electronic filing system. As part of this, they must ensure all annual reports are filed, or they cannot transition. They should also ensure their address in their Statement of Directors and Registered Office is current and up to date with the Registry.

Prior to November 28, 2016, In early October, each society will receive a letter containing a PIN which will allow them to log in to the new website and create a BCeID, an online account for using BC government services. They can then reset the PIN and distribute it to others in their organization. Each BCeID account will be tied to an individual, and individuals can be associated with multiple society PINS. The example used was an accountant could have multiple society clients. Note that the Registry has announced these letters were sent out on November 10, 2016, and should be arriving before the transition date. The Registry has also announced the on-boarding system will not be available until November 28, 2016.

TRANSITION

The online filing system appears straight-forward and relatively simple. The Registry will not be checking purposes or the bylaws — they expect applicants to comply with the new Act without their involvement. The Constitution alteration will be done on a separate screen with a fillable box to cut-and-paste or type in the constitution, minus unalterable provisions. A checkbox will exist on this screen for societies wishing to be member funded.

Bylaws will be uploaded as a .doc or other file formats (for those that do not use Word). This will be done on a separate screen.

CRA AND GAMING

Deputy Registrar of Companies, Debbie Turner, stated that the Registry had spoken to the Canada Revenue Agency and BC Gaming and the organizations had stated so long as the bylaws are transitioned without change and the unalterable provisions are marked as “this is previously unalterable” there will not be an issue with charitable status and/or gaming funding — however, she stated a FAQ would be posted to the Registries website with further information on the approach each organization would take.

Photograph by Jude Freeman. Used under a Creative Commons license. No changes were made to this image.

The FAQ on the Registry‘s website states, for those societies interested in funding:

• If a “basic” transition is made, where only the provisions from the constitution other than the name and purposes are moved to the bylaws, any previously unalterable provisions are marked as same, and the reporting societies provisions are added, a society will still be able to apply for community gaming grants;
• If a society becomes “member-funded”, it will not be eligible for community gaming grants; and
• If other amendments on transition are made, these may affect eligibility: there is no clear answer and the Ministry of Community, Sport and Cultural Development guidelines should be consulted.

The FAQ also states, for those societies receiving funding:

• So long as societies which amend bylaws on transition continue to comply with the Ministry guidelines, they will be eligible; and
• Member-funded societies are not eligible.

The FAQ provides a little clarity to an issue which directors, societies staff, and lawyers have discussed over the past several months.

Photo by dvdmnk, used under a Creative Commons License. No changes were made to the original. 

Note that if transitioning without legal advice, you should consult the Act and regulations, as well as the Registry’s transition guide, to ensure your bylaws do not conflict with the new Act.

1. Create an electronic consolidated version of your society’s bylaws. In August, the Registry will be providing a certified copy of all filings for $40 — this is a great starting point for those who don’t keep track of their most recent bylaws.
2. Prior to October 2016, ensure your society’s Statement of Directors and Registered Office address is up to date. Without a recent address for a registered office, your society may miss out on important communications from the Registry.
3. In October 2016, each society will receive a PIN code, which will allow it to onboard onto the Registry’s new online system. At a presentation in July, the Registry announced this PIN will not be provided by phone or e-mail, and will only be sent in hardcopy (at present).
4. Choose one member of your society to onboard. This person will create a BCeID, an electronic account, specific to them as an individual. They will then link their personal BCeID with the PIN and be asked to change it. They may then distribute the PIN to other key society directors and manager, as well as service providers of the society (such as accountants, paralegals, or lawyers). Each person will be able to link their BCeID with multiple societies.
5. Prior to transition, ensure your society’s most recent annual report is filed with the Registry. Without a file annual report, your society cannot transition. If you society does not transition by November 28, 2018, your society will be struck from the register.
6. Once on-boarded, create a copy of your society’s constitution and remove all provisions other than your society’s purposes (and add a statement you are member funded, if this applies to you). Put all the excess from the constitution into your consolidated bylaws. I’d recommend doing this at the end of your current bylaws, for ease of reading. If a provision was previously unalterable, reproduce it in full and add “This provision was previously unalterable.”
7. In the online system, cut-and-paste or type out your now lean constitution. If you are member funded, ensure you click the appropriate box and have the appropriate statement in your constitution. You do not want to miss this important step.
8. In the online system, upload your revised bylaws. Note that any other bylaw changes must be authorized by special resolution — without that resolution, you must file only the limited modified bylaws described above.
9. Complete your electronic filing.
10. Celebrate, as your society has successfully transitioned under the new Societies Act. 

UNDERSTANDING THE TIMING OF SPECIAL RESOLUTIONS

If your organization wants to make changes to its bylaws, or wishes to change its constitution, different timing considerations apply. Please note that different considerations would apply to registered charities and those organization which received BC Gaming funds.

No bylaw changes

1. Pre-November 28 – No need for a special resolution. The new Act expressly allows removal of provisions from the constitution which offend the new Act, and addition of the member funded provisions where allowed. It also expressly permits the slight modifications to the bylaws without a special resolution.
2. November 28 / Transition – This is a simple transition, described above.
3. Post-Transition – A special resolution is required to change bylaws, including previously unalterable provisions, and to change purposes. This resolution must be passed after November 28, 2016.

Bylaw changes on transition

1. Pre-November 28 – A special resolution is needed to change the bylaws, if changes are over-and-above the house-keeping permitted by the new Act. This resolution cannot remove unalterable provisions.
2. November 28 / Transition – The modified constitution and bylaws are filed, along with the special resolution. Note that they must include the previously unalterable provisions.
3. Post-Transition – At this point, a new special resolution can be passed allowing for the removal of the unalterable provisions. This resolution must be passed after November 28, 2016.

Photograph by +Jethro+ under a Creative Commons license.

But if that deadline is missed, an application to the court is necessary. The particular phrasing of the section is unclear, as is the process for making the application.

STATUTORY LANGUAGE

Section 193(2) of the Act does not allow a society to adopt member-funded society status, “unless the court, on the application of the society, has, by order, declared that the society is not prohibited” from becoming a member-funded society.

PROCESS FOR OBTAINING STATUS

The process for obtaining status under this provision, after transition or loss of this status, is as follows:

1. The society must meet all the requirements for being member-funded;
2. The society must pass a special resolution authorizing the required constitution amendment;
3. The society must make an application to the BC Supreme Court, in the form of a petition supported by an affidavit. This affidavit it should contain enough information for the court to make a decision as to whether the society meets the member funded requirements.  Though there are no cases expressly dealing with this yet, it is likely the affidavit it will be required to contain at least:
   1. Sworn statements from a director or senior manager of the society explaining how the society meets the member funded requirements (including a history of how the organization either gained or lost its original member funded status); and
   2. Financial statements or similar which demonstrate sources of funding to the society  within the relevant time period.

Pending on how British Columbia Supreme Court interprets this provision of the Act,  this process could, instead of going to judges chambers as petitions normally do, be dealt with as some form of desk order or order in writing.

It remains to be seen at how this procedure will be handled by the BC courts. If your organization wishes to take advantage of member-funded status, it should include the appropriate statement in its constitution the time of transition.

Photo by Gullhem Vellet. Used under a Creative Commons license. No changes were made to this image.