31420-12-1 SAWRIDGE, Indian vs. ROLAND, Twinn et al

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1 that they have. And I’ll just briefly review the facts with you of that case because I think
2 they’re important and I think they’re quite distinguishable from the scenario you have
3 before you. Garden River was a situation where the Garden River Band settled a land
4 claim, and arising out of that, they declared a per capita distribution of $1 million. And
5 they passed a band council resolution to that effect in September of 1987. Subsequent to
6 that, they had a meeting and they decided that they were going to distribute these moneys
7 tothe membership in December of 1987. And at the time of the distribution, there were a
8 number of children of band members who were not yet members of the band. These
9 children were children of what I will call C-31 members. And of course these would
10 have been children of Indian women who lost their membership, and of course the
11 children themselves would not have had any membership. The requirement at that time
12 was for the first generation to become a member of a band, they had to first get their
13 status back, their Indian status back. And with respect to this particular band, they had a
14 membership code that required the children then to apply for membership, and then they
15 would become members. The problem was that there was a backlog with the federal
16 government with respect to getting the Indian status back. And as such, at the time of the
17 distribution in December, these children were not yet members even though the chief and
18 council at the time knew that ultimately they would become members. And in fact, they
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did become members subsequent to the date of the distribution.
21 The Ontario Court of Appeal there determined that in those circumstances the trustees had
22 a duty -- well, first of all, they found that the chief and council, by declaring a per capita
23 distribution, that resulted in a trust and that they were now holding these funds in trust for
24 the members of the band. The Ontario Court of Appeal then found that as trustees there
25 was an obligation on the trustees to ascertain the beneficiaries. And the court found that
26 when the band distributed the funds, they did so by choosing an arbitrary deadline. And
27 it was that decision to arbitrarily decide that these funds would be distributed in December
28 that caused the court some great concern. And ultimately, the court found that the
29 trustees did not meet their obligation and that these minor -- these children were entitled
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to their proceeds.
32 Now, the Public Trustee in this matter argues that trustees have a duty to make reasonable
33 inquiries into the existence of beneficiaries and to identify and locate these beneficiaries.
34 And in principle, we don’t take issue with the fact that a trustee has that obligation when
35 it -- when it purports to act and to distribute funds. Our concern, however, is that that
36 issue is not before this Court. There is no distribution before this Court that is being --
37 that is being addressed, unlike the case in Garden River. Garden River, there was -- there
38 was actually a distribution, and then after the fact, the parties came to court and addressed
39 whether the trustees met their obligations at that time. Here, to go back to our advice and
40 directions application, we’re coming to court simply to determine whether the definition
41 of beneficiary is contrary to public policy or not. And if so, should it be changed? It has