RECAP: Superior court hears RSU legal claim against Rye, injunction decision expected this week

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By Madi Wong, Emma Sandri and Alexandra Holyk

To read about the next steps regarding the injunction, scroll to the bottom of the article for more information

The Ryerson Students’ Union (RSU) will face “irreparable damage” if Ryerson University continues not to recognize it as the official group representing full-time undergraduate students, a Toronto Superior Court Justice heard on Friday. 

The RSU is seeking an injunction since Ryerson terminated their contractual agreement on Jan. 24. An injunction would require the university to temporarily continue to recognize the union and transfer withheld student union fees to the RSU, said Karen Benner, associate director, university communications.

If granted, the injunction will be in effect until the legal dispute between Ryerson and the RSU is resolved at a civil trial. 

After multiple rounds of discussion from both Ryerson and the RSU’s legal teams, Justice Markus Koehnen said that he will likely give a decision by next Friday—March 13.  

While the legal claim was underway, Ryerson took steps to form a new student government — with the results of the election of a government structure being announced on Friday morning.

 A new undergraduate and graduate students’ union were voted in and elections are expected to take place shortly to fulfil executive positions. 

Background

On Jan. 24, Ryerson announced the university would be terminating its 1986 Operating Agreement with the RSU effective immediately. 

The agreement allowed the university to collect fees from students and transfer them to the RSU to fund student centres and groups. It also recognized the RSU as an independent and autonomous structure from Ryerson.

The termination came after concerns from the university about the RSU including: financial mismanagement under a former RSU president’s name and recent resignations of executives from the 2019-20 slate.

Previously on Jan. 28, RSU president Vanessa Henry announced at a press conference that the students’ union filed a legal claim against the university.

In a statement published by the RSU that Tuesday evening, the union said they were seeking $2.7 million in damages for breach of contract, the release of the student fees withheld by the university, $100,000 in punitive damages and a declaration that Ryerson is in breach of its agreement with the RSU.

The statement also specified that the claim includes the RSU’s legal costs throughout the process. 

In addition, the Continuing Education Students’ Association at Ryerson (CESAR) was given intervener status for Friday’s court date. This means that the union is able to be a part of the court case, not necessarily on the side of the RSU or Ryerson but to represent the interests of its union and the Canadian Federation of Students. 

‘Inherently undemocratic’: RSU lawyer

Part of the RSU’s argument was that the university breached its contract with the RSU—not the other way around—and that the termination of the agreement was improper.

Counsel for the RSU, Alexi Wood, argued the union would face irreparable harm if the injunction was not granted. 

According to Wood, the RSU would cease to exist if the university does not treat the RSU as the official union, hand over withheld fees and cease the creation of the new student government before the legal matter is resolved. 

Wood also said that if the injunction is not granted, two out of the three parties involved in the case would be harmed—the RSU and students; with the latter losing vital services provided by the union. 

In addition, Wood said McMillen acknowledged during a previous cross-examination that students were not consulted about the decision to terminate the university’s agreement with the RSU. Instead, the university imposed the creation of a new student government on the Ryerson student body. 

“[It’s] inherently undemocratic,” said Wood. 

The university was mandated to collect fees from the students and deliver them to the RSU and there is no oversight provision within the contract to allow it to withhold fees, said Wood.  

“The university wanted an agreement with the RSU that would prohibit the RSU from criticizing the university”

The union took action to remedy the supposed breach of contract—the alleged executive misspending on union credit cards in 2018-19—by conducting a financial review, filing a police report and hiring new staff.

“These are students who did the best that they could,” said Wood. 

According to the lawyer, the RSU is an independent corporation that has policed itself and investigated issues of wrongdoing. She mentioned examples, such as the RSU’s Board of Directors impeaching executive members who were alleged to have not been putting in their full 40 hours of work.

The RSU argued that the university is attempting to “read in” rights and obligations into the contract, which was not explicitly stated. 

While Ryerson has implemented an interim agreement to support the student advocacy coordinator, SASSL and the Good Food Centre, this only accounts for $30,000 of the RSU’s budget, said Wood.

“[This] is clearly not enough to fund the rest of the RSU’s services such as the equity centres,” she said. 

Louis Century, the lawyer representing the Canadian Federation of Students (CFS) and the Continuing Education Students’ Association of Ryerson (CESAR), said he was defending the principles of student autonomy that arise in the case. 

Century said that when an autonomous student union is terminated by a university, that harm cannot be repaired. 

“[A] student union belongs to and is funded by students,” he said.

Century added that the impeachment of an RSU executive this year was not a failure of an accountable student government structure, but the opposite — it imposes accountability on its staff. 

‘Troubled and dysfunctional’: Ryerson lawyer 

Justice Koehnen raised concerns about the new student government structure being implemented by Ryerson. He said that it seems to him the only difference between the RSU and this new structure is that “the university wanted an agreement with the RSU that would prohibit the RSU from criticizing the university.” 

He added that this was “troubling” to him and seemed like the university was “using the cloak of [student] democracy” to change or terminate the contract. In response, Ryerson’s lawyer Geoff Hall said that “cloaking” the contract “is simply not the case.” 

Koehnen also asked Hall how Ryerson’s new government will avoid wrongdoings. He added that people in post-secondary institutions aren’t running public companies or governments and therefore do not have the relevant life experience. Being a part of an organization like the RSU allows students to develop skill sets, he said. 

Hall said that Koehnen’s point is a “double-edged sword” and that “adults need to be treated like adults.” He also stated it’s inappropriate to dismiss some of the problems as inexperienced youth and that the RSU should be held accountable for being the independent organization they want to be. 

Koehnen said that in every organization, it is only a matter of time until someone engages in wrongdoing. However, what matters is how the organization reacts–in this case, the RSU got rid of the wrongdoer, brought in an accountant and new policies. 

“There were repeated statements that a forensic audit was being done and…turned out those statements were false…that is the breach of trust”

“It’s not as if they were sitting back doing nothing,” he said. 

Hall said though it’s true that the year was filled with “spinning [tires].” He added that “this wasn’t a matter of weeks, a matter of months…this was a retractive effort to get things back on rails.” 

In addition, Koehnen later stated that the only reason this would be reputably hard is because the university has “manufactured a new student government” that is well on its way as opposed to waiting for a resolution with the current one. 

He asked Hall what the urgency was of forming a new government instead of waiting for the current one to find a resolution. 

“Things weren’t really limbo. What would have been so bad about continuing to fund not just the three programs that you chose to run but all the programs until next year?” he asked.

In response, Hall listed exam season in April and the turnover of students from summer to September as reasons why the new government was moving quickly. 

Moreover, Hall said current RSU executives and members are “perfectly free” to run for positions under Ryerson’s newly elected student government structure. He adds there has been “no effort” to stop this process and no one said, “don’t let the students vote.” 

When asked about the forensic audit by Koehnen, Hall stated that the RSU not conducting the audit was not the problem, but rather the promise made by the union to do so. He said there was no real evidence of why a review was conducted instead of an audit other than “someone thought it was expensive.”  

At the RSU’s Semi-Annual General Meeting, their “financial review” of last academic year’s expenditures revealed that $99,477 could not be verified as legitimate expenditures by the RSU’s audit committee.

Hall said the problem was the “continued misinformation or incomplete information about what was coming.”

“There were repeated statements that a forensic audit was being done and…turned out those statements were false…that is the breach of trust,” he said. “[There] was never a request from RSU to Ryerson to help fund it…so if funding was a problem, one would have thought the first thing you do was to [go to Ryerson and ask to pay for it].”

Hall added that the core issue of Friday’s hearing was for Koehnen to decide whether or not to “hand the keys” to controlling student money back to a “troubled and dysfunctional entity” and interrupt the six-week process of creating a new government, or continue to allow the new student government to be made. 

What’s to come? 

If Koehnen rules in favour of the injunction, the RSU will continue operating as the official student governing body—as they were prior to the agreement termination—until the trial expected to take place later this year. 

According to Wood, the RSU will only be able to operate on the funds they have until the end of March. Afterwards, they are required to use their operational reserves to continue supporting student services.

The decision to grant an injunction would also result in the disbandment of the two student government structures that were elected on March 6—the Ryerson Undergraduate Students’ Alliance and the Ryerson Graduate Students’ Union.

However, if the injunction is not approved, Ryerson plans to continue with the next stage of implementing two new student governments and will host elections for undergraduate and graduate students in early April.

The next court date has yet to be announced.

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