A recent decision of the BC Supreme Court may set a precedent that rules and other documents incorporated by bylaw may be enforced as bylaws, when certain circumstances are met. It is also one of the first reported cases to establish oppression under the new Societies Act.
Can you draft your members out of an “oppression” remedy?
Under the new Societies Act, members may bring a claim against a society for unfairly prejudicial or oppressive conduct on the part of the society, its directors, or its members. I’ve often been asked whether you can contract out of this right by having members waive it in advance or in restricting it in your bylaws, or whether an automatic termination provision can be used to expel a member who brings such legal proceedings.
“Oppression” under the new Societies Act
The oppression remedy seeks to protect members from unfair actions taken by a society, its members, or its directors. Outside a request to wind-up a society, the new Societies Act brings in a wider and more accessible oppression remedy which borrows from corporate law but does not exactly reproduce it.