No. S003443

Vancouver Registry

IN THE SUPREME COURT OF BRITISH COLUMBIA

BETWEEN:

UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, DOUGLAS J. McCARRON, JAMES E. SMITH, WAYNE COX, MICHAEL AUTZEN and DAVID WRIGHT on their own behalf as members of United Brotherhood of Carpenters and Joiners of America and on behalf of and representing all members of United Brotherhood of Carpenters and Joiners of America

PLAINTIFFS

AND:

BRITISH COLUMBIA PROVINCIAL COUNCIL OF CARPENTERS, LENNOX EMBREE, DAVID FLYNN, G.R. & S. HOLDINGS LTD. and ON THE LEVEL PUBLISHERS LTD.

DEFENDANTS

 

 

CLOSING SUBMISSIONS OF THE DEFENDANTS

 

I.            INTRODUCTION

A.            Honesty and Integrity in Leadership

1.      Early in the Defendants' Opening, I said that for the Plaintiffs, this case is about money and power; for the Defendants, it is about democracy in union governance. Your Ladyship will hear about money and power, but I wish to begin with an overview of what democracy means to some of the witnesses who gave evidence before you.

            (i)            Plaintiffs’ View of Democracy

2.      The Plaintiff Smith had this to say about the present practice of BC union members electing their business representatives:

Currently, it's a popularity contest, essentially. Shake hands with enough people and slap them on the back and call them good guys, chances are you'll get their vote in return for another three year period.

Cross Examination of Smith, October 25, 2002, p. 8 lines 3 to 10

3.      That could be said of any election at any level in any democracy.

4.      Here's McCarron's vision of democracy in the Brotherhood:

Q. Okay. Was it your intention that the people -- that the union members affected by this reorganization would be entitled to vote on the restructuring?

A. No.

Q. Why not?

A. Well, the constitution gives the general president and the general executive board the authority to make those type of changes.

Q. Fair enough that you have the authority, but did it not occur to you it might be appropriate to have the people affected vote on their future?

A. No, it didn't.

Q. Okay. And why not?

A. Well, because, I mean, that's the way the brotherhood's always been run. The general president and the executive board makes those decisions, and that's the way it's -- you know, in consultation with the local people.

Cross Examination of McCarron, October 16, 2002, p. 53 lines 15 to 39

5.      In fact, that is not how the Brotherhood has been run in BC since 1943.

6.      Wright revealed his attitude to democracy in his Marcy 1997 letter to Smith strongly recommending that all upcoming elections at the BC Locals and District Councils be postponed so that members would not be distracted from the far more important issue of restructuring.  As he put it, elections would only “block the vision”.

Exhibit 28, Letter of Wright to Smith, March 3, 1997

7.      McCarthy expressed himself on the subject in his September 4, 1997 memo to Smith (the "Strategy Memo"), where, at p. 3, he says, "Wayne Cox has been identified as a moderate and after the attempted coup in his recent Local 1598 election in Victoria he may be more cooperative." In the world the Plaintiffs inhabit, "attempted coup" presumably means a closely contested election.

Exhibit 9, Tab 227 Strategy Memo, September 4, 1997

8.      The reason why the Plaintiffs and their agents speak this way is because they are contemptuous of rank and file BC members, to say nothing of their rights. To them, the members are putty to be moulded. They're annoyed at present, because they think the members are putty in the hands of Embree and Flynn, while the Plaintiffs think they should be the ones doing the moulding. That the members might have rationally concluded that their best interests are served by their present leadership, or that they are intelligent enough to realize they receive no value from the International for the five to six hundred thousand dollars a year they currently pay as "per capita" payments, is something the Plaintiffs have never contemplated. One only has to look at Resolution M-23 in the 2002 Convention  to conclude that the Plaintiffs' contempt for the BC  members is unjustified.

Exhibit 17, 2002 Convention Proceedings, General Resolutions, p. 10

            (ii)            Plaintiffs’ Failure to Adhere to Core Principles of Trade Unionism

9.      The Constitution of the United Brotherhood requires union officials and employees “…by legal and proper means to elevate the moral, intellectual and social conditions of all our members and to improve the trade in every way possible" (s.2).  This principle reflects membership expectations, and the reasonableness of this expectation is unquestionable.

10.    The Plaintiffs in this Action have failed to live up that principle.  Their actions reveal an international labour organization that has, in this instance, lost sight of the principles at the heart of trade unionism: democracy and fraternity.  First, the Plaintiffs have demonstrated a casual willingness to sacrifice the expressed desires of the majority of BC members.  And they have done so in order to consolidate the International’s power through a forced restructuring of the BC union. 

11.    Second, McCarthy and Smith were at times dishonest in giving their evidence.  For example, the Strategy Memo makes nonsense of McCarthy and Smith’s evidence that the sum total of the International’s strategic plan was to hold "consultations." The Court heard the embarrassingly transparent evidence of Smith and McCarthy in distancing themselves from the Strategy Memo. On re-examination, Smith attempted to distance himself from the memo by referring to his busy travel schedule and occupation with matters elsewhere.  His evidence only explained why the Strategy Memo bears a fax header (McCarthy faxed it to him and the exhibit must be Smith's copy). 

            (iii)            The Defendants Have Adhered to the International Constitution

12.    The Individual Plaintiffs claim to represent more than half a million carpenters.  In fact, they only represent themselves and their own prerogatives and ambitions.  In any meaningful sense, it is Embree and Flynn who mirror the rank and file members of the Brotherhood.  They have demonstrated honesty and integrity.  They have also showed themselves to be sincere advocates of trade union democracy and fraternity. 

13.    On the topic of union democracy, Embree and Flynn spoke passionately about the right of members to engage in free and democratic debate—debate in Board Meetings; debate in committees; and most of all, in Convention.  On the topic of fraternity, both Embree and Flynn testified that they value their affiliation with the Brotherhood and would be reluctant to leave it behind altogether.  Their goal of securing greater autonomy or independence for the Provincial Council within the International is understandable given the high-handed treatment of BC members by the International in recent years (e.g. softwood lumber, no votes on restructuring, forced mergers, denial of natural justice, this litigation).  The desire of BC carpenters to secure greater autonomy or greater independence is hardly unprecedented within the Canadian labour movement.

14.    A resolution of the overarching dispute between the International and the Provincial Council falls well outside the scope of this lawsuit.  The sole issue in this case is whether or not the Section 10B Directive is void.  Nonetheless, the determination of that narrow issue requires this Court to examine the background relationship between the International and the Provincial Council to determine the bona fides of the Directive itself and the proper interpretation of Section 10B.  The Defendants submit that they have complied in all respects with the International Constitution.  They were under no obligation, contractual or otherwise, to comply with a Directive issued in bad faith for improper purposes.

B.            Competing Views of This Case

            (i)            The Plaintiffs’ Story

15.    The Plaintiffs’ story is set out in the pleadings and in affidavits filed in support of a summary judgment application brought weeks after the Statement of Claim was filed in June 2000.  In essence, the Plaintiffs say that by virtue of Section 10B of the Constitution of the United Brotherhood, McCarron enjoys the unfettered discretion to take possession of books, papers and other records of any subordinate body within the International.  In June 2000 he invoked Section 10B in respect of the Provincial Council.  His June 9, 2000 Directive cites one reason, namely that the resolutions from the April 2000 Provincial Council Convention and the subsequent correspondence from the Constitution Review Committee dated May 26, 2000 “imply that the Provincial Council may attempt to cease functioning as a subordinate body of the United Brotherhood under the present constitutional framework.”  Although this was the only reason stated in the Section 10B Directive, his Affidavit of July 6, 2000 (Ex. 40) advances two ex post facto reasons for the Directive.  First, he deposed that the Provincial Council appears not to have kept its property in the name of Trustees as required in the Constitution of the United Brotherhood, but rather uses G.R.&S. Holdings Ltd. as a holding company.  The arrangement between G.R. & S and the Provincial Council was established in 1970.  Second, he deposed that contributions to a government lobbying campaign (the “Bill 44” or “leaky condo” campaign), which that had been authorized by the Provincial Council in 1997 (i.e. almost three years earlier), may have violated the terms of the Provincial Council’s Constitution. 

16.    The Plaintiffs say that the Provincial Council has violated the United Brotherhood Constitution by failing to comply with the Section 10B Directive.  Flynn and Embree have, for selfish reasons, opposed the Section 10B Directive without the support of the Provincial Council Executive Board and the membership.  Thus, Flynn and Embree have breached duties owed to the United Brotherhood and are personal Defendants.

            (ii)            Overview of the Evidence

Escalating Dispute over Restructuring and Autonomy

17.    The Section 10B Directive came four years into an escalating dispute between the International and the Provincial Council (together with its affiliated Local Unions and District Councils) over the issue of restructuring the BC Union.  Although there is consensus that some form of restructuring is required in British Columbia to respond to a changing economy and declining membership, there is and has been a fundamental disagreement between the International and the Provincial Council with respect to the process by which restructuring should be brought about, and the form it should take. 

18.    In 1996 (coinciding with the election of McCarron as General President one year earlier) the International embarked on a restructuring initiative in British Columbia.  The Plaintiff Smith, as the General Executive Board member for Canada, is responsible for implementing restructuring in BC.  He regards restructuring in BC as one of his most important objectives.  According to Wright, his co-Plaintiff Smith is committed to bringing about restructuring by any means possible.

19.    Two features of the International’s restructuring initiative quickly became lightning rods of discontent among the BC membership.  First, the International intended to impose restructuring unilaterally (later adapted to involve consultation), without allowing affected members to vote on the proposed changes.  Second, the proposed changes involved, among other things, forced mergers of Locals without a vote of affected members, the transfer of power and bargaining rights from the Provincial Council to more than one newly-established Regional Councils, the replacement of the elected officers and delegates of the Provincial Council with Regional Council founding officers and delegates appointed by the International.  The Regional Council(s) would also have the power to remove the elected BC Pension trustees, according to the "33 Model Bylaws" (Ex. 6, Tab 5, s. 19).

20.    In March 1998 -only six months after McCarthy wrote the Strategy Memo- the International conducted a Section 10B audit and commenced trusteeship proceedings against a large Lower Mainland Local (Local 1928), whose business representative happens to be the First Vice President of the Provincial Council.  The pretext for the hearing was allegations of financial impropriety, but none were substantiated.  The Provincial Council believes that the International’s actions in respect of Local 1928 were undertaken for the same reasons as cited at p. 3 of the Strategy Memo, where the International had targeted Local 1907 for trusteeship for the express purpose of acquiring trade union status (i.e. bargaining rights) for itself.  

21.    The International has also made two other significant attempts to begin implementing its model of restructuring in British Columbia by directive.  On each occasion, the International acted after some form of consultation, but affected members were not permitted to vote on the changes.  In particular: 

(a)                On August 23, 1999, the International purported to establish a Regional Council on Vancouver Island and ordered the merger of three Vancouver Island Locals which supported the Provincial Council’s stance on restructuring (Locals 2068, 513 and 1812), without a vote of the members of the Locals. 

(b)               The International refused to approve a merger agreement that had been entered into by Locals 1237 and 1998 on the basis of the wishes of their members. Instead, McCarron purported to order the transfer of members from a Local supportive of the Provincial Council (Local 1237) into the one remaining Local serviced by the Plaintiff Wright (Local 2397). 

22.    All of these actions provoked a strong reaction from the membership.  The Provincial Council has actively and vocally opposed the International’s initiatives in British Columbia.  For example:

(a)                The Provincial Council has conducted referenda on the issue of restructuring, producing results that were supportive of the Provincial Council and unhelpful to the International. 

(b)               Individual members of the Provincial Council leadership have been involved in public demonstrations against the International and the General President.  One notable example occurred in Port Alberni in 1999.  On that occasion the membership in attendance walked out after Embree asked McCarron whether members would be given the opportunity to vote on restructuring and whether members could vote on mergers of their Locals.  McCarron replied “No” to both questions.  The International believes that the Provincial Council staged the walkout.

(c)                Numerous Locals affiliated with the Provincial Council have sponsored resolutions at Annual Conventions of the Provincial Council, which denounced the International and advocated greater autonomy within the International.  Many of those resolutions were passed at Conventions.  One resolution submitted to the 1999 Convention had actually called for withdrawal from the International.  The resolution did not pass, but that is beside the point.  Given that McCarron's Section 10B Directive was ostensible prompted by inflammatory resolutions submitted to the 2000 Convention, it is astonishing that neither his co-Plaintiffs nor McCarthy had even advised McCarron of that development.

Exhibit 14, 1999 Proceedings, General Resolutions, M-23, p. 16

Cross Examination of McCarron, October 25, 2002, p. 50 lines 3 to 19

(d)               The Provincial Council has offered moral support to other Locals in North America, which have attempted to resist similar restructuring initiatives of the International.

(e)                The Provincial Council has attempted to garner support among other unions, the BC Federation of Labour and the Canadian Labour Congress in its opposition to the International’s restructuring policy.

(f)                 The Provincial Council lobbied government for legislative changes to require international labour organizations to demonstrate “just cause” at the Labour Relations Board before imposing trusteeships on affiliated BC unions.

(g)                The Provincial Council supported Local 1928 during the trusteeship proceedings.

23.    Equally important, the Provincial Council has sponsored applications to the Labour Relations Board to block restructuring from taking place without a vote of affected members.  For example, when McCarron purported to order the transfer of members from Local 1237 into Local 2397 against the wishes of the members of Local 1237, the Provincial Council supported Local 1237’s application to the Labour Relations Board to block the merger directive.  In February 2000 (only months before the Section 10B Directive), the Labour Relations Board found McCarron's directive to be illegal, and recognized the right of members to vote on a transfer of their bargaining rights (BCLRB B77/2000, February 17, 2000; leave to reconsideration denied BCLRB B323/2000, September 7, 2000).  The Provincial Council similarly supported the application by the Vancouver Island Locals to require a vote on the mergers.  The decision of the Labour Relations Board B77/2000 eventually prompted McCarron to revoke his directive with respect to Vancouver Island. 

24.    Due in no small part to the Provincial Council’s sustained opposition at the Labour Relations Board, the International’s restructuring efforts in British Columbia are currently back to square one.  The law in British Columbia (as established in BCLRB B77/2000) requires the International to hold a membership vote on restructuring, otherwise it cannot transfer bargaining rights from Locals or the Provincial Council to the proposed Regional Councils.  The International will not hold a vote because they would not win a vote.  Smith has no doubt that a majority of BC members oppose the International's restructuring.

Cross Examination of Smith, October 25, 2002, p. 27, lines 3 to 7

25.    Not surprisingly, the International has come to regard the Provincial Council (in the words of the Plaintiff Wright) as the “single, biggest obstacle” to restructuring in BC.

Autonomy

26.    The debate on the issue of autonomy has been a central facet of the political discourse in the BC union for decades.  However, the dispute with the International over restructuring has invigorated the debate over autonomy.  There is no question that the 2000 Convention marked a new level of political dissent, characterized by strong anti-International sentiment and a more aggressive stance on the issue of autonomy.  At the 2000 Convention, the Provincial Council Executive Board was instructed by resolution to take active steps to negotiate greater autonomy within the International: the right to govern their own affairs, the right to hold assets and property in the name of the Provincial Council, and the right to amend the Provincial Council Constitution without the approval of the International. 

C.        The Section 10B Directive

27.    The International does not want to negotiate any departures from the current Constitutional arrangement.  In fact, McCarron contended in his June 9, 2000 Directive that he had invoked Section 10B in response to what transpired at the 2000 Provincial Council Convention.  It is no great leap to suggest that the Section 10B Directive and this lawsuit have had—and were intended to have—a chilling effect on that legitimate democratic debate. 

28.    On the evidence, the Section 10B Directive is the first important step by the International towards the imposition of supervision or trusteeship on the Provincial Council.  Imposing trusteeship on the Provincial Council is a viable means for the International to break the stalemate on restructuring that has existed since the February 2000 Labour Relations Board decision B77/2000.  Trusteeship avoids the necessity of holding a vote to transfer the Provincial Council’s bargaining rights to newly created Regional Councils.  Through trusteeship, the International would simply acquire the Provincial Council’s bargaining rights and assets, without having to hold a membership vote.  This is the point McCarthy is making in the Strategy Memo at pp. 2 - 3.

29.    But a trusteeship/supervision hearing requires a pretext, if only for a veil of political legitimacy; in our submission, Section 10B is being used to obtain the pretext.  Following an audit, many of the unpleaded issues raised by the Plaintiffs in this case at trial (bolstered by 17 days of examinations for discovery and countless document requests) would be used to discredit the current leadership and would become the necessary pretext for trusteeship. Supervision hearings are determined at a hearing presided over by representatives of the International.

30.    The International in fact used the first available pretext following the commencement of this lawsuit to threaten the Provincial Council with trusteeship: the complaint by Cox and Autzen to their co-Plaintiff McCarron about their treatment at the first Provincial Council Executive Board meeting following commencement of the present Action.  This resulted in the Plaintiffs' solicitors threatening the Provincial Council with a supervision hearing, notwithstanding the absurd conflicts of interest with McCarron being the judge of a complaint by his co-Plaintiffs against the Defendant Provincial Council.

Exhibit 7, Tab 100, Letter of Hordo, Ross & Bennett

D.            Manner in Which the Plaintiffs Presented Evidence

            (i)            Only One of Five Plaintiffs Testified in the Plaintiffs' Case

31.    Out of the five named Plaintiffs, only McCarron testified as part of the Plaintiffs' case. 

32.    His evidence-in-chief was brief and well oiled.  It was delivered like a political speech.  Reduced to its essence, his position is: I have the power; I exercised my power; the Provincial Council ought to have governed themselves accordingly; but they defied my Directive.

33.    It was readily apparent from McCarron’s evidence that he had (literally) rubber-stamped the Section 10B Directive. Any CEO of a multi-million dollar organization like the International must delegate.  But this Court should be cognizant of the fact that his advisors were not called as part of the Plaintiffs’ case to explain why they had recommended to McCarron that he invoke Section 10B.  Their motives are highly relevant: McCarron and the International act through their agents Smith, McCarthy and Wright.

Cross-Examination of Mr. McCarron, October 16, 2002, p.44 lines 18 to 24

34.    Plaintiffs' counsel implicitly acknowledged the limits on McCarron’s ability to testify about matters in issue when he correctly pointed out that McCarron can only speak from his personal knowledge about whether the International had considered imposing trusteeship on the Provincial Council; he cannot speak to whether others within the International had that intention.  But the plain fact is that McCarron asserts his right as General President to issue the 10B Directive. Neither he nor his agents could have held an honest belief that 10B was being invoked over a genuine concern about the assets of the Provincial Council.  On the contrary, they—and that room of lawyers that McCarthy described who came from around the continent to analyze virtually every letter the Provincial Council wrote—had to know the Directive was simply a weapon to be used against the Provincial Council to gain an advantage in the struggle over restructuring.

Cross-Examination of McCarron, October 16, 2002, p.61 line 44 to p. 62 line 9  (Request for Clarification as to Personal Knowledge of Trusteeship)

D.            Explanation for Why Four Plaintiffs Did Not Testify As Part of Their Own Case

35.    The Defendants submit that, having now heard the evidence of Autzen, Cox, Smith, and Wright, as well as McCarthy, this Court should be under no illusion as to why they were not called to testify as part of their own case.  

            (i)            Plaintiff Autzen

36.    The Plaintiff Autzen provided significant support for the Defendants' case.  As a member of the Executive Board and a former Trustee of the Provincial Council, he had unrestricted access to all of the information the Plaintiffs claim to be seeking in this Action.  His evidence was, in effect, that the Provincial Council’s financial records are an open book.  He had no complaints or concerns about GR&S Holdings Ltd.—the matter first raised by his co-Plaintiff McCarron in an affidavit relied upon in a summary judgment application before Clancy J.  Autzen authorized the Bill 44 Campaign expenditures that the Plaintiffs have relied upon in this lawsuit as a basis for invoking Section 10B.  In short, he has no problems with the way that the Provincial Council conducts its business. Except for his carrot of a consolidation of floorlayers' Locals identified for him at p. 3 of the Strategy Memo, there is no reason for Autzen to be involved in this Action.

            (ii)            Plaintiff Cox

37.    The Plaintiff Cox probably told the truth at trial about his involvement with the International.  However, his actions were frequently underhanded, and at times outright unethical.   Perhaps most surprising is that Cox does not appear to comprehend why the Provincial Council has sought to exclude him from participating in its governance since this litigation began.  His laundry list of complaints to the International, whether sincere or not, have been used by the International as political leverage in its dealings with the Provincial Council.

38.    A man who would tape the November 16, 2000 meeting—after hearing Embree, the Chairman of the meeting, state that taping would be a criminal offence—would do anything. Cox was oblivious to any sense of the fiduciary duties he owed to the Provincial Council. It does not matter whether Embree's statement was correct in law, at the very least, it brought home to Cox the seriousness with which the Chairman viewed the act of surreptitious taping—a practice that even Smith condemns.

39.    Cox loyally delivered a significant amount of information to McCarthy on a regular basis, unaware that as long ago as September 1997, McCarthy had spotted him as someone who would be "cooperative" with the International.  The International is prepared to manipulate even its most loyal supporters to achieve its overall objectives.

40.    Cox seems to believe that he owes higher duties to the International than to the Provincial Council. Were he correct, it would mock the law relating to fiduciaries, because a member of any Board could claim duties owed to another group in priority to those of the organization of which he is a Board member.

            (iii)            Plaintiff Wright

41.    The Plaintiff Wright is one of two employees of the International (out of only five in Canada) stationed in BC.  It is his job to collect information from people like Cox and Autzen and pass it along to either McCarthy or Smith.  A less charitable characterization of his job description is that he looks for dirt on the Provincial Council that might be useful to the International in its dispute with the Provincial Council.  He has shown himself capable of discharging this function. 

42.    On other matters, Mr. Wright’s testimony was not credible.  Specifically, he denied any knowledge of a plan for BC restructuring, notwithstanding a significant body of documentary evidence to the contrary.  Also, his explanation for Cox’s diary note (i.e. that the Local 1928 trusteeship hearing “went bad”) was weak and implausible.

            (iv)            McCarthy (International’s Representative On Discovery)

43.    McCarthy is a member of the Ontario bar.  It seems clear that he has quarterbacked much of the International’s strategy on restructuring in BC.

44.    McCarthy demonstrated his willingness to put the party line—no plan for restructuring—ahead of telling the truth under oath.  He was unmoved by the documentary evidence—some of it written by him—indicating that a plan for restructuring in BC had existed as far back as 1996.

45.    Even worse, the Plaintiff Cox’s diary indicates that McCarthy had received from Cox the substance of the Provincial Council’s legal advice.  That diary entry is supported by Cox’s evidence to this effect.  McCarthy could not recall accepting that information from Cox; however, Cox recalled the occasion clearly.  A member of the Ontario bar—practising or not—should know better than to willingly receive (or request?) the privileged communications of others. McCarthy’s conduct alone is sufficiently reprehensible to justify an award of punitive damages against the International.

            (v)            Plaintiff Smith

46.    The Plaintiff Smith played a role in drafting the Section 10B letter.  This is not surprising, since he is responsible for the International’s actions in Canada, and for the International’s five employees in this country.  Smith works closely with McCarthy, who is also stationed in Ontario.  The two of them bounce ideas off each other and develop plans and strategies.

47.    The Defendants say that Smith represents all that is wrong and corrupt with the International in Canada.  Even his employee Wright portrays him as someone who seeks to implement restructuring at any cost.  Under his direction, the International has been contemptuous of the membership’s democratic rights and the labour law of this province.

48.    Jan Noster’s testimony about his conversation with Smith also reveals Smith’s Machiavellian nature when it comes to BC union politics.  This Court should accept Mr. Noster’s evidence that Smith wants to break up the power base of the Provincial Council.

49.    Smith was not truthful in giving his evidence.  In fact, this Court heard preposterous evidence from him and McCarthy, as they attempted to distance themselves from the Strategy Memo.  Their contention that the International had and has “no plan” for restructuring beyond consulting with the membership is absurd; not only does the Strategy Memo lay it out, they have been implementing it over the last several years.  They have not implemented Smith's "consultation" plan because there is no such plan and the Plaintiffs don't care what the BC members want in any event.

50.    He half-heartedly condemned Cox for tape recording a Provincial Council meeting after being confronted by a letter in which he had gone on record as “strongly condemning” surreptitious taping (Ex. 6, Tab 43).  His explanation for failing to take any action against his co-Plaintiff since learning of the taping was that it was not the International’s normal practice to become involved.  Contrast that reaction with the International's actions when Cox and Autzen complained about their treatment at a Provincial Council Executive Board meeting. 

            (vi)            "The Smell Test"

51.    On all of the evidence, the International and the other Plaintiffs have consistently acted in an underhanded and dishonest manner.  This Court may well find that McCarron had been kept insulated from the contemptible actions of his advisors, but the actions of Smith, McCarthy and Wright are still impugned.  In our respectful submission, the Court should find that Section 10B was invoked in bad faith for a purpose other than that for which it had been intended. 

E.            Credibility of Embree and Flynn

52.    In a bizarre twist—given the evidence of the Plaintiffs’ own misconduct and the demeanour of those witnesses called as Adverse Parties by the Defendants—the Plaintiffs have endeavoured to impugn the credibility of Flynn and Embree.  The credibility of Embree and Flynn is irrelevant to the issue at bar, which is whether Section 10B was invoked in good faith and for proper purposes.

53.    One of the themes that arose during the cross-examinations of Flynn and Embree was that they are not sincere believers in the democratic principles that they preach; rather, they cloak themselves in the veil of democracy for political purposes. After days of cross-examination there is no evidence that Flynn and Embree were anything but forthright as witnesses.  Their expressed desire to advocate and defend the democratic rights of the BC members is genuine. 

54.    They have also been portrayed as imperious and non-inclusive.  This is a red herring.  First, the accusation seems to be based on the proposition that the resident officers were required to obtain prior approval of the entire Executive Board before taking any significant action.  Embree and Flynn are the only resident officers and they are expected to act between Conventions and Executive Board meetings.  They are held accountable for their actions at subsequent meetings of the Executive Board and at Conventions.  There is no evidence to suggest they were out of step with the rest of the Executive Board (other than Autzen and Cox). 

55.    Second, it is a complete answer to this point that no criticism has been directed at Embree and Flynn's actions, either from the Executive Board of the Provincial Council or from the delegates at the annual Convention.  To the contrary, they are clearly supported by those bodies, both before and after taking actions relating to the International.

56.    The lengths to which the Plaintiffs will go in smearing them was demonstrated in the cross-examination of Flynn, when, after reviewing the handling by Flynn of some complex financial matters in 1998, when suddenly he was asked these questions:

Q And were you -- was 1998 an election year?

A Yes, it was.

Q You stood for election that year?

A Yes, I did.

The answers were not followed up.  The insinuation was that Flynn, an obviously honest witness and  person, had engaged is some accounting chicanery to advance his prospects of election—a despicable insinuation that the Plaintiffs did not have the courage to put to him directly.

Cross Examination of David Flynn, October 22, 2002, p. 32 lines 38 to 41

57.    The vehemence with which the Plaintiffs have unjustly attacked Embree and Flynn in this litigation is itself evidence of bad faith.  The Defendants say that the Plaintiffs have engaged in a harsh, vindictive and reprehensible smear campaign without any genuine belief that any of the Defendants have engaged in any impropriety. 

F.         The Pursuit of Stale/Moot Issues

58.    The Defendants say that the subject matter of the cross-examination of both Flynn and Embree by Plaintiffs’ counsel during this trial demonstrates that the Provincial Council’s concerns about the International's intention to impose trusteeship are not ephemeral. 

59.    Flynn was cross-examined for approximately three quarters of a day on two issues: (1) expenditures for the Bill 44 Campaign authorized over five years ago in 1997; (2) the Provincial Council’s decision in 1994 (i.e. eight years ago) to merge two funds.  McCarron raised a third issue in his affidavit filed in the summary judgment proceedings: the Provincial Council’s use since 1970 of a holding company as an investment vehicle.  With respect to the Bill 44 Campaign and GR&S Holdings Ltd., the Provincial Council has taken steps to rectify any uncertainty that might exist. 

60.    The Plaintiffs would not have pursued these stale or moot issues had they been acting bona fide.  They have used the discovery process in this litigation to gather information about allegedly improper activities of the Provincial Council dating back many years.  The Plaintiffs have provided no indication that they intend to give up on any of these issues following this litigation; they have done nothing to suggest that their auditor will not continue the process of resurrecting old issues, should they be granted the Order they seek.  In short, this case foreshadows a future trusteeship hearing.

G.        The Overarching Labour Relations Context

61.    The Plaintiffs seek to have this case considered and decided in a vacuum, entirely divorced from the labour relations context in which the Provincial Council and the International exist.  That is not appropriate, as the Supreme Court of Canada held in Berry v. Pulley (2002) 211 D.L.R. (4^th) 651 at para. 48, infra.

62.    Labour organizations are powerful, quasi-public organizations exercising influence over the livelihood of thousands of members.  Power and discretion conferred upon officials by the constitution of a labour organization must therefore be subject to limits imposed by BC labour law, the reasonable expectation of members, natural justice and the duty of good faith.  Put another way, it is unreasonable to suppose that union members, merely by virtue of joining a union (which is frequently a prerequisite of employment) have consented to the improper exercise of authority by union officials acting arbitrarily, contrary to their reasonable expectation, in bad faith, or without an honest belief that their actions are necessary for the benefit of affected members. 

 

H.        Case Directly on Point

            (i)            Allen v. Townsend

63.