At the AGM on June 2nd, 2024, the Board presented the following motion for approval.
7. Motion that the resolutions, minutes, contracts, appointments, payments, acts and proceeding of the Board of Directors and Officials of the Model Aeronautics Association of Canada up to the present time, be hereby ratified and approved, and said Directors and Officials be released by all liability herein.
This is a most extraordinary piece of chicanery. The Board of a NFP Corporation already has a certain amount of protection from blame for its mistakes. The legislation protects Board members by including a clause absolving them from blame as long as they have acted in a way that a reasonable person might be expected to act. Beyond that, MAAC carries Errors & Omissions insurance to provide defence for them in the event that legal action is taken against them.
Despite all of the above, this Board feels sufficiently vulnerable that they have asked the membership to absolve them of all responsibility or accountability for their prior acts. Those who have read the many articles on MAACNews.ca are well aware of what some of those misdeeds are. This Board should feel vulnerable.
The motion was Invalid.
The motion quoted above did not appear on the proxy form that was sent out with the Notice of Meeting on May 1st, 2024, nor was it mentioned anywhere in the Notice. It did appear, however, to those who voted online, or those who voted by being present (in-person or virtually) at the meeting. This contravenes the requirements of the Canada Not-for-Profit Corporations Act (CNCA) and thus the vote on the motion was null and void. Those who voted by proxy weren’t even given the chance to vote on it at all and the others, who did have an opportunity to vote, were not provided with the required notice of the motion or the information necessary to make an informed decision – as required by the Act.
What if it is brought back for ratification?
Should a similar motion come up again, the membership should reject it. The Board has adequate protection against bona fide mistakes, it should not have any protection from deliberate, or incompetent, errors. The legislation makes it clear that, although they are only held to the standards of a reasonable person, they are not immune from the consequences of acts that are in dereliction of their fiduciary duty, are in contravention of the CNCA, are otherwise unlawful, or are not what is expected of a reasonable person. Being a ‘volunteer’ at a job – which is something that is so often brought up as if it was a significant factor – is not an excuse for not doing a job faithfully, and especially when competent advice has been ignored in the process or when a question has been raised about it and ignored. Such a motion, if properly passed, would really not provide any meaningful protection against the consequences of wrongdoing by the Board – it could, however, complicate any proceedings and thus would be unwise.