Executive Summary: Key Legal and Evidentiary Issues

• Applicants sought to convert an oppression proceeding under s 253 of the Canada Not-for-profit Corporations Act from an application into an action, which would result in determination through a full trial rather than a summary process.

• The Proposed Statement of Claim contained substantive amendments without supporting evidence, including allegations that Mr. Blake misappropriated GTC funds, which were not particularized contrary to Rule 117.

• Quorum validity at the February 3, 2025 GTC board meeting was contested based on questions about Mr. Blake's authority before being sworn in and whether Cindy McDonald was a properly appointed director.

• Alberta jurisprudence requiring at least some evidence to support substantive pleading amendments was adopted by the Court as persuasive authority.

• The Proposed Statement of Claim did not properly plead oppression as it failed to state the Applicants' reasonable expectations and how the Respondents failed to meet those expectations, contrary to the test in BCE Inc v 1976 Debentureholders, 2008 SCC 69.

• Proposed amendments including allegations of conspiracy and breach of trust and fiduciary duty require "significant evidence" establishing a "good ground" or "exceptional circumstances," which was not provided.

The governance dispute within the Gwich'in Tribal Council

The Gwich'in Tribal Council (GTC) is an Indigenous organization that represents participants to the Gwich'in Comprehensive Land Claim Agreement. The GTC was created at the time of the Gwich'in Comprehensive Land Claim Agreement negotiations and has since continued to serve several purposes, including the protection of the rights of the Gwich'in and the development and promotion of their interests. The GTC is incorporated under the Canada Not-for-profit Corporations Act, with its main governance rules contained in By-law No. 1 Governance. The GTC Board is composed of one Grand Chief, who is elected by the GTC Participant Members, and eight additional directors, two directors appointed by each of the four Designated Gwich'in Organizations (DGOs): the Tetlit Gwich'in Council (TGC), the Gwich'ya Gwich'in Council (GGC), the Ehdiitat Gwich'in Council (EGC), and the Nihtat Gwich'in Council (NGC).

The Applicants in this case are two DGOs, the NGC and the EGC, and two directors of the GTC: Kelly McLeod, the President of the NGC, and Michael Greenland, the President of the EGC. The Respondents are Frederick Blake Jr., who was elected Grand Chief of the GTC in August 2024; Diane Koe and Richard Nerysoo, the two TGC directors appointed to sit on the GTC board; Doris Koe, a director of the GGC and of the GTC; and Cindy McDonald, who participated in a GTC board meeting on February 3, 2025 as a representative of the GGC in replacement of John Firth, who was unable to attend due to health issues.

Events following the Grand Chief election

In August 2024, Frederick Blake Jr. received more votes than the incumbent Grand Chief, Ken Kyikavichik, in an election for the office of Grand Chief of the GTC. The day after the election, Mr. Kyikavichik lodged a complaint alleging violations of the GTC election rules. The GTC Board ruled such violations occurred and called a new election. Mr. Blake challenged this decision before the Court. The Court heard an application challenging the Board's decision to call a new election on October 30, 2024. On January 14, 2025, the Court found that some of the alleged violations to the election rules did occur but that they did not justify a new election, and declared Mr. Blake elected Grand Chief of the GTC.

After this decision, the Applicants did not immediately recognize Mr. Blake as Grand Chief. The parties disagreed on the interpretation of By-law No. 1 and more specifically on what steps, if any, were required for Mr. Blake to take office. In late January 2025, Mr. Blake took the position that no further steps were required for him to exercise the powers of Grand Chief. He called a special board meeting scheduled for February 3, 2025, in Edmonton. Mr. McLeod and Mr. Greenland raised concerns about Mr. Blake's authority to call a board meeting because he had not been sworn in yet. On January 31, 2025, a swearing-in ceremony was held in Tsiigehtchic. However, this ceremony was not recognized or attended by representatives of the NGC and of the EGC.

The February 3, 2025 board meeting and subsequent proceedings

On February 3, 2025, a GTC board meeting was held in Edmonton. The Respondents attended and participated in the meeting. Twenty motions were adopted during this meeting. The NGC and the EGC Directors did not attend the meeting or seek to participate remotely. Of the twenty motions adopted, the Applicants especially take issue with Motion 1 (appointing Mr. Blake as Chairman of the GTC); Motion 5 (terminating the employment of the GTC CEO Jamie Koe); Motion 6 (directing Mr. Blake to review and manage all employee contracts at the GTC); Motion 12 (revoking previous resolutions that suspended funding for the GGC and the TGC and reinstating funding); Motion 14 (terminating the existing Directors of the Gwich'in Development Corporation (GDC) and Gwich'in Settlement Corporation (GSC) and replacing them); and Motion 19 (directing that Mr. Blake receive back pay and benefits retroactively to the date of the election).

On February 14, 2025, the Applicants filed an Originating Notice seeking relief from oppression under s 253 of the Act. The application challenges the way the February 3 board meeting was called, how it was held, and the legality of some of the motions adopted. On the same day, the Applicants filed a motion for interlocutory injunction, which was adjourned to March 7, 2025. On February 28, 2025, Mr. Blake filed an application seeking, amongst other relief, a declaration that Mr. McLeod and Mr. Greenland were in civil contempt of the January 14, 2025 decision and an order declaring and confirming Mr. Blake as Grand Chief of the GTC.

Between February 14 and April 3, 2025, the parties filed affidavit evidence setting out their versions of events related to the GTC governance issues, including evidence related to the February 15 board meeting, when the Applicants claim they were prevented from fully participating and exercising their fiduciary duties as directors of the GTC. The Court heard the interlocutory injunction application on April 3, 2025, and delivered an oral decision on April 16, 2025. Applying the test for mandatory injunctive relief, the Court found the Applicants did not establish they had a strong prima facie case on the questions of Mr. Blake's ability to assume the office of Grand Chief, including the calling of the February 3 board meeting, the quorum at the meeting and the lawfulness of most motions adopted on that day. However, the Court concluded that the Applicants had a strong prima facie case for oppression with respect to the lawfulness of the motion replacing the GDC and GSC boards and for breach of fiduciary duty in the way the February 3 decisions were made. Nonetheless, the Court was not convinced the Applicants had met the two other branches of the injunction test: irreparable harm and the balance of convenience, and dismissed the application.

On May 2, 2025, the parties filed a consent order that recognizes Mr. Blake as Grand Chief of the GTC without the need for any further process.

The conversion application and procedural deficiencies

On August 15, 2025, the Applicants filed a Notice of Motion seeking the conversion of the proceeding initiated by way of Originating Notice into an action. The Proposed Statement of Claim appended to the motion contains many new allegations that postdate the Originating Notice. The Applicants are in essence alleging that the February 3, 2025 board meeting is the first of many events that unfolded between February 2025 and June 2025 that form part of an ongoing pattern of conduct from the Respondents to exclude the Applicants from the governance of the GTC. The Applicants also assert that the Respondents have renewed their efforts to replace the GDC and the GSC boards in ways that are not compliant with the applicable bylaws. Additionally, the Applicants allege that Mr. Blake has misappropriated GTC funds.

The Respondents opposed the application, arguing that the Applicants have not displaced the statutory presumption that an oppression claim should be brought by way of application, that the conversion application is a disguised application to amend, and that the Proposed Statement of Claim offends the rules of pleading in many respects.

The Court's analysis and ruling

The Court found that granting the conversion application would be akin to granting leave to amend the Originating Notice and that to obtain such leave, the Applicants must rely on some evidence that supports the proposed amendments. The Court adopted the Alberta line of jurisprudence requiring that substantive amendments be supported by at least some evidence. While the applicable cases set a low evidentiary threshold, the Applicants did not file any evidence to support substantive amendments.

The Court noted that the necessity to file evidence in support of amendments is of particular importance because the Proposed Statement of Claim contains new allegations of conspiracy and of breach of trust and fiduciary duty. Moreover, the Proposed Statement of Claim only contains a bald assertion that Mr. Blake misappropriated GTC funds without particularizing the allegations, contrary to Rule 117. The Court found that proposing an amended pleading that offends such a fundamental rule of pleading is a form of prejudice sufficient to deny leave to amend.

The Court agreed that the Proposed Statement of Claim does not state the Applicants' reasonable expectations and how the Respondents failed to meet those expectations, which is required when oppression is a cause of action. However, the Court rejected arguments that the Proposed Statement of Claim contained irrelevant facts, evidence, and arguments that would violate the rules of pleading.

The Court concluded that the combination of the failure to file some evidence in support of the substantive amendments and the failure to particularize the allegations of misappropriation of GTC funds justify dismissing the application for conversion. However, the Court noted that only some of the issues raised by the Originating Notice are moot (those resolved by the consent order regarding Mr. Blake's status as Grand Chief), while other important issues related to the governance of the GTC are still pending and the Applicants are entitled to pursue them.

The Court dismissed the conversion application without prejudice to the Applicants' right to renew the application when they have addressed the issues identified in the decision. The application was dismissed with costs in any event of the cause. No specific monetary amount was ordered or awarded in this ruling.