The Court dismissed various claims against members of two past governments of the First Nation who were also directors of the trustee for a trust for its members. The plaintiffs alleged breach of fiduciary duty, breach of trust, and negligence regarding roughly $11 million of transfers made from the trust to the First Nation over a four-year period. They also sued the former Band administrator for alleged breach of contract and fiduciary duty, negligence, knowing assistance, and knowing receipt. All claims were dismissed and the evidence failed to show impropriety or dysfunction.
The Plaintiffs sue members of two past governments of the Blueberry River First Nation [“BRFN”], a band as defined in the Indian Act. Against those Defendants, the Plaintiffs allege a breach of fiduciary duty, breach of trust and negligence. The BRFN includes approximately 500 members, about half of whom live on the BRFN reserve. The reserve is located about an hour and a half by car north of Fort St. John, in northeast British Columbia.
The Blueberry Trust [“Trust”], and predecessor trusts, were established to hold and manage $76 million that the BRFN received in 1998 from its claim against Canada for damages arising out of the surrender of reserve land in 1945, and Canada’s disposition of the underlying mineral rights. The central dispute is to do with the transfer of approximately $11 million from the Trust to the First Nation and related entities, in a number of transfers over a four-year period.
The Defendants believe the claims against them in this action are politically motivated, and not based on bona fide legal grievances. There is another defendant, Mr. Laird, who was brought into this case as a defendant at the time when the operating minds of the Plaintiffs appear to have decided that the Defendants were taking money from the Trust for their own purposes. The Court believes the Plaintiffs kept Mr. Laird as a defendant on the theory that the other Defendants would have needed his help in implementing their wrongful plans. The same people who are suing Mr. Laird, however, asked him to come back in 2014, to assist the new government of the Nation for the 10 weeks Mr. Laird had available in his schedule. Mr. Laird had the misfortune to be joined in this action, along with several others against whom the Plaintiffs eventually discontinued their claims, simply because he happened to be one of those who had contracted to work with the Defendants-lead governments. Mr. Laird did excellent work for the Band throughout his employment as Band administrator. It was a difficult role for anyone at any time in the Band’s recent history, given the numerous and serious social problems the Band faces.
The current leadership of the Band points to the value of the Trust dropping substantially while the Defendants were the Chief or on Council, which in itself raised flags of suspicion about possible breaches of fiduciary duty and other wrongs. All of the members of the two Councils in the four year period testified that they considered financial issues within the BRFN as they arose, particularly when such matters were brought before them for consideration and decisions.
Documents in evidence showed during this period, the Chief and Council taking a number of steps to address the BRFN’s financial procedures and financial issues that were of concern at the time. Chief and Council did not have the skills to reform the financial department themselves. All they could do was obtain skilled advice, try to retain skilled employees, and support the reform proposals that were recommended. That is what they did. It was not an easy task, in part because it is difficult to retain skilled employees to work for the BRFN due, at least in part, to the isolation of the reserve. In the circumstances, they generally took appropriate steps, and improved the financial department’s performance while maintaining what they believed was an appropriate balance as between curbing overspending and maintaining needed social and health support programs.
Financial matters were not all that the Chief and Council had to deal with. Of significant importance were the many health and social issues that members of the BRFN faced, and in some cases, struggled with. Drug addition, domestic violence, mental health and the health and safety of the BRFN’s children were all important issues for the Chief and Council to address. The health and wellbeing of the members was a priority for the Chief and Council during this time period. In addition to supporting the health department, school, and working with the RCMP in relation to gang issues, they retained professionals to deliver workshops to the members and provide consulting services, and supported implementing an action plan to address social challenges. The Chief and Council during the four year period also took positive steps toward improving governance by retaining a former Chief, and Calgary lawyer, to prepare a Governance Manual.
The evidence elicited at trial showed a governing group that worked together, did its best to address the many issues and challenges that the BRFN faced during that time, and performed its duties satisfactorily. The claims against the Defendants, for knowing assistance, breach of fiduciary duty and negligence, as well as for breach of trust, are dismissed.