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Thread: A Vote of No Confidence for the CFC President

  1. #31
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    Quote Originally Posted by Fred McKim View Post
    I don't think it's your opinion Vlad is referring to, but perhaps your ability to do and not do things behind the scenes on this Forum. [Not my own opinion]
    Well, I'm not sure how relevant anything like that is, considering I haven't run an election in around a decade for the OCA, for the CFC more like 14 years (and in-person!), and other than approving registrations I have nothing to do with elections now.

    This is exactly what he said: "One thing that has become clear to me is that while I have full confidence in Lyle Craver, to run a fair election, I do not have confidence in you Christopher Mallon."

    Everything done behind the scenes on the forums is logged. So even if I did something behind the scenes, Lyle would be able to see it.

    He also said: "You are clearly running interference for those attempting this coup."

    So that implies that something I've DONE is interfering somehow - to the benefit of those who he apparently believes are planning an illegal military takeover of the CFC.

    Given that I've done nothing other than state my opinion on the matter, you can surely see why I reach the conclusion that stating my opinion is somehow considered interference?
    Christopher Mallon
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  2. #32
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    Quote Originally Posted by Vladimir Drkulec View Post
    It was not a unanimous decision of the board since I voted against it. The decision was that I do something which I and the board could be sued for. There was nothing that prevented someone else from making the same request. I am an unpaid volunteer, and am not required to do things that put the CFC or myself at financial risk and in fact it is my duty to refuse such demands. The will to take this action collapsed after it was established that it was against Les's advice.

    For better or worse you are going to be lumped in with the company you keep.

    Good luck defending your position.
    I never refuse to argue my position. And although this does not directly relate to the stated in our Motion reason for your removal from office, I think, that Voting Members would be interested to compare my and your positions before deciding how to vote. So, in order:

    1. At the CFC Board of Directors, a vote was taken on the intention to ask CFC Publicity Officer Vadim Tsypin to resign due to his unworthy behaviour and an attempt to bribe. Note: the vote was not for the dismissal of the Officer, but just for asking him to resign himself. Hal Bond was saying that the vote for asking the Officer to resign originally was unanimous, but later you changed your vote after receiving legal advice. From your post it sounds like you voted against from the beginning. I’ll give you the benefit of the doubt here. Let’s assume that the Board of Directors voted for asking Officer to resign not unanimously, but by a majority. This also corresponds with Fred McKim’s statement made on this Forum:
    “While the majority of the Executive voted for an action, President Vlad Drkulec declined to move forward after seeking legal advice from Les Bunning, our long time lawyer.”

    2. Your explanation above is that you voted against because “The decision was that I do something which I and the board could be sued for.” So, you are telling us that if the board would ask Vadim Tsypin to resign, he could sue the board. Hypothetically, of course, anyone can sue anyone, and for anything. However, in this particular situation, it sounds like nonsense to me. First, it was not in Vadim’s interests to make this story public - and if suing, it would become public immediately; second, if employees are suing organizations for wrongful dismissal – this is always about financial compensation - while in our case CFC Publicity Officer is a volunteer position; and third, even if Vadim sued, his chances of winning would be close to zero, because the bribe attempt was alluded to in the letter to CFC. Furthermore, CFC bylaw clearly states that: “In the absence of a written agreement to the contrary, the board may remove, whether for cause or without cause, any officer of the Corporation”. Accordingly, in my view, the board could safely not only ask Vadim to resign, but could simply fire him without any problem.

    3. Now my main point. Suppose the advice you received from lawyer was really weighing you down – I’ll continue to give you the benefit of the doubt – and you genuinely feared being sued. Then, you should have raised your concern to the board, and should have tried to convince them to change their decision. Apparently, you did just that, and even managed to convince one of the Directors to vote with you. We can learn this from the following Fred McKim’s post on this Forum: “As one of the original movers, I subsequently conferred with Les and then agreed that it was not in the best interests of the CFC to move forward. There is nothing else to be said at this point”. Thus, your attempt to persuade the Board of Directors failed (there were 7 Directors in CFC at that time), and the majority decision to ask Vadim Tsypin to resign remained in force. In such a situation, you could only act in two legal ways:

    a) to obey the majority decision
    OR
    b) to resign yourself due to disagreement with this decision; by the way – this is exactly what Hal Bond did in a similar situation – when he disagreed with the majority decision to endorse Diana Tsypina’s application.

    This is how democracy works; this is what NFP Act provides; and this is what CFC bylaw strictly stipulates: “At all meetings of the board, every question shall be decided by a majority of the votes cast on the question”.

    Lawyers don’t make decisions for organizations. Boards of directors do.

    A SUMMARY OF MY POSITION ON THIS EPISODE

    You did not have the right (under any circumstances) to unilaterally cancel the decision of the CFC Board of Directors. By doing this you violated your Fiduciary Duty to CFC. And that’s what Hal Bond and other Directors could really (and not hypothetically) sue you for – if they chose it – with a high chance of succeeding. I’ll end this post with a Hal Bond’s quote on this Forum: “If we can’t even object to a bribe without being sued by the person who offered it, we should close our doors. We are not an organization, we are a hostage.”


    Unfortunately, this episode was not the only one where you abused your power. To be continued.
    Last edited by Victor Itkin; 03-25-2021 at 08:19 PM.

  3. #33
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    I really don't have the time to respond to this now and then again in two weeks. This is a very busy time for me and the CFC.

    I will comment on fiduciary duty which you seem to have a horribly distorted view of. While in the case of a for profit corporation some of what you are saying might apply they do not in the case of a non-profit. There is no duty to follow the dictates of the board if the board asks me to do something inconsistent with our bylaws, our handbook, or with the NFP act or any law in Canada. There is no defence possible of such acts.

    Duties of directors and officers
    • 148 (1) Every director and officer of a corporation in exercising their powers and discharging their duties shall

      • (a) act honestly and in good faith with a view to the best interests of the corporation; and
      • (b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

    • Marginal note duty to comply

      (2) Every director and officer of a corporation shall comply with


      • (a) this Act and the regulations; and
      • (b) the articles, the by-laws and any unanimous member agreement.

    • Marginal note:Lawfulness of articles and purpose
      (3) Every director of a corporation shall verify the lawfulness of the articles and the purpose of the corporation.
    • Marginal note:No exculpation

      (4) Subject to subsection 170(5), no provision in a contract, the articles, the by-laws or a resolution relieves a director or an officer from the duty to act in accordance with this Act or the regulations or relieves them from liability for a breach of this Act or the regulations.

    Marginal noteirector — reasonable diligence

    • 149 (1) A director is not liable under section 145 or 146, and has complied with his or her duties under subsection 148(2) and (3), if the director exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances, including reliance in good faith on


      • (a) financial statements of the corporation represented to the director by an officer of the corporation or in a written report of the public accountant of the corporation fairly to reflect the financial condition of the corporation; or
      • (b) a report of a person whose profession lends credibility to a statement made by that person.

    • Marginal note director — good faith

      (2) A director has complied with his or her duties under subsection 148(1) if the director relied in good faith on

      • (a) financial statements of the corporation represented to the director by an officer of the corporation or in a written report of the public accountant of the corporation fairly to reflect the financial condition of the corporation; or
      • (b) a report of a person whose profession lends credibility to a statement made by that person.



    There is absolutely no duty for a president to follow the dictates of the board especially when those dictates are contrary to the bylaws and the law. Our Handbook which we still use for most of the day to day operations of the CFC states clearly:

    4. PRESIDENT: The President shall be the chief executive Officer of the Federation. He shall preside at all meetings of the Assembly of Governors, or of the Board of Directors, when he is personally present. He shall exercise constant active and general supervision of the Officers of the Federation, and the conduct of its affairs, with the exception of:

    a) Those matters which are reserved to the Assembly of Governors or the Board of Directors.

    b) Those matters which have already been delegated to Committees appointed by the Assembly of Governors.

    The President shall have full power to take such action in the name of the Federation, as he may in his sole discretion decide.

    In matters where an immediate decision is not necessary, the president shall confer with the other Officers of the Federation, but as a matter of general policy only, and not so as to limit in any way his authority. In any matter covered by his general authority and not coming within the duties specifically allotted to any other Officer or Officers, the decision of the President shall override that of any other Officer.

    The President shall exercise constant and active supervision over the chief employee of the Chess Federation of Canada (commonly known as the Executive Director).
    Last edited by Vladimir Drkulec; 03-26-2021 at 01:31 PM.

  4. #34
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    There is also an anomaly in Quebec defamation law which is not the case anywhere else in Canada. In Quebec, you can lose a defamation case and have to pay hundreds of thousands of dollars even if everything you say is true. This is why if you catch someone red-handed cheating at chess in Quebec you cannot widely publicize it because of the privacy aspects of the situation. The truth of what you are alleging is irrelevant.

    Two lawyers commented on the possible venue of such a case and neither was sure that the venue for the legal action would not be Quebec.

  5. #35
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    The fiduciary duty of the CFC president or any other officer is to the CFC itself and not to the other officers. You cannot help your friend Hal Bond if it puts the CFC at risk of a catastrophic loss. You have to set aside the friendship and do what is in the best interest of the CFC keeping in mind the overall mission of the corporation.

  6. #36
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    There are also charter of rights implications in the idea that the board members can compel another board member to some communication which clearly not in his best interest, the board's best interest and the CFC's best interest. There is no law that you can cite that would compel a CFC president to undertake such action and many that suggest that his duty is to do the exact thing that I did which was to refuse to take the action which was asked of me particularly given the legal advice which also supported my position.

  7. #37
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    Vlad, you can't have it both ways. You tell us at times that the old handbook is no longer in force and is presented for guidelines only, and now you quote a piece of it which basically says the President is the Dictator of the CFC.

    Even if it IS still in force (which you have stated in the past that it's NOT, which is also I believe the general public consensus), it does not overrule our actual legal documents and it does not overrule the NFP act. So on what grounds are you refusing to call the Special Meeting as requested by 5 voting members (representing more than 5% of the total votes)?

    Our actual, LEGAL definition of the duties of President is this:

    President

    The president shall be the chief executive officer of the Corporation and shall be responsible for implementing the strategic plans and policies of the Corporation. The president shall, subject to the authority of the board, have general supervision of the affairs of the Corporation and will be chair of the board, and shall be a director. When present, shall preside at all meetings of the board of directors and of the members. The president shall have such other duties and powers as the board may specify.


    As you can see, the part about supervision of officers is gone, as are the following two:

    The President shall have full power to take such action in the name of the Federation, as he may in his sole discretion decide.

    In matters where an immediate decision is not necessary, the president shall confer with the other Officers of the Federation, but as a matter of general policy only, and not so as to limit in any way his authority. In any matter covered by his general authority and not coming within the duties specifically allotted to any other Officer or Officers, the decision of the President shall override that of any other Officer.

    Also, key phrase in the legal definition: "subject to the authority of the board"
    Christopher Mallon
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  8. #38
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    Quote Originally Posted by Vladimir Drkulec View Post
    I will comment on fiduciary duty which you seem to have a horribly distorted view of. While in the case of a for profit corporation some of what you are saying might apply they do not in the case of a non-profit.
    I will not argue with you on terminology. Probably, you are correct that for non-profits the definition of fiduciary duty might be different. But this in no way changes my position that by not fulfilling the majority decision of the Board to ask for Vadim's resignation, you have abused your power.

    Quote Originally Posted by Vladimir Drkulec View Post
    There is absolutely no duty for a president to follow the dictates of the board especially when those dictates are contrary to the bylaws and the law.
    Unbelievable! You’re scaring me with this kind of peremptory statement.

    Every Canadian high school student knows that the Boards of Directors are the main governing bodies of organizations (including non-profits) in the periods between members’ meetings. The decision of the Board of Directors can only be overturned by a members’ vote at a following meeting or by a court order. The President (or CEO), in turn, is fully subordinate to the Board of Directors. In organizations, where the President is not a director, the Board of Directors appoints the President and can also dismiss him at any time with or without cause. In case of the CFC, according to the CFC bylaw, the President shall be a Director. Therefore, the CFC Board of Directors cannot dismiss you. For removing the CFC President from office, a majority vote of the Voting Members is required at the meeting.

    In the periods between the meetings, all decisions are made by the Board of Directors. The NFP Act (Section 137) delegates to the bylaws the wide possibilities to determine how the Board of Directors should make its decisions in each particular organization. Here is a quote from the CFC bylaw, which clearly rules that all CFC Board of Directors’ decisions should be made by majority:

    "Votes to Govern at Meetings of the Board of Directors
    At all meetings of the board, every question shall be decided by a majority of the votes cast on the question. In case of an equality of votes, the chair of the meeting in addition to an original vote shall have a second or casting vote".

    Thus, your aforementioned statement distorts the true states of affairs exactly the opposite: not “there is no duty for a president to follow the dictates of the board”, but to the contrary – president’s duty is to obey the boards’ decisions, and in no way he may dictate to the board to overturn them. Accordingly, the essence of my position related to this episode stands: by cancelling the CFC Board of Directors’ majority decision to ask for Vadim’s resignation, you have violated the law (the CFC bylaw).

    Quote Originally Posted by Vladimir Drkulec View Post
    Our Handbook which we still use for most of the day to day operations of the CFC states clearly: ...
    Vlad, how many times have you told us that the CFC Handbook is out of date; that the NFP Act and the CFC bylaw have taken its place, and that the Handbook may be used only in those situations when it does not contradict them? Now, obviously, this is the very case when the Handbook is against the NFP Act and the CFC bylaw. Why are you quoting Handbook here? Are you making fun of us? Read your own reply to Egidijus Zeromskis, which you have previously posted on this Forum (here is the link http://www.chesscanada.info/forum/sh...t=#post36400):

    Quote Originally Posted by Egidijus Zeromskis
    At this moment, the CFC has not a (special) policy/guidelines/procedure regarding conflict of interests. (special) -- anything beyond the NFP Act.

    The "older" handbook had a clause about "chess business" persons not eligible to be executives. Is it still valid? The question was raised amongst Execs. (need to follow up)
    Quote Originally Posted by Vladimir Drkulec View Post
    The clause is superseded by the NFP act. It looks to me that you are putting forward arguments using the old handbook when it suits your aim and ignoring it when it doesn't. The handbook is our policy except where it directly contradicts the act. In this case it does contradict the act.
    Shame on you.

  9. #39
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    I guess according to you then we have no rules for the Olympiad teams or CYCC or procedure to decide who gets to go to new tournaments? Interesting...

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    Quote Originally Posted by Vladimir Drkulec View Post
    I guess according to you then we have no rules for the Olympiad teams or CYCC or procedure to decide who gets to go to new tournaments? Interesting...
    Rules for the Olympiad teams, CYCC or other chess tournaments are not regulated by the NFP Act.

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