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Artistic director Ken Gass poses for a photo on the set of the play, The Rez Sisters, in Toronto, Ont. on Nov. 8, 2011.Michelle Siu

In a move that has shocked Toronto's theatre community, Factory Theatre artistic director Ken Gass has been dismissed by the board of directors of the company he founded in 1970.

Gass, who has been back at the helm of the downtown theatre devoted to Canadian playwrights for the past 15 years, had his contract terminated Wednesday as a long-simmering dispute with the board over planned theatre renovations came to a head.

"We've had creative differences over the future of the theatre," said Gass, who announced the "surprise and unexpected" news ahead of the board .

Ron Struys, the chair of Factory's board of directors, said that there were no financial difficulties at the theatre, nor any concerns with Gass's artistic choices. "We wanted to move to a new phase of growth and development at the theatre," he said. "Believe me, as a board, the decision we make we do not make lightly."

Many theatre artists, however, expressed outrage that Gass – who returned to save the company from folding in 1996 – would be summarily fired. The theatre's flagship playwright George F. Walker told The Globe and Mail he was going to call his agent and pull his new play, Dead Metaphor, from the upcoming season in protest.

"I just urge everyone else who's scheduled to have a play done there to do the same thing," Walker said. "It's so repulsive."

The termination stems from a disagreement between Gass and the board over how to improve accessibility at the theatre's heritage building in Toronto.

In recent years, Gass has been touting an ambitious renovation that would bring the theatre's run-down facilities up to the standards of similarly sized theatres in Montreal and Chicago.

The board, however, wants to go ahead with a smaller, more affordable renovation.

Struys, who announced a national search for a new artistic director, said the board respected Gass's contributions to Factory and Canadian theatre and had asked him to stay on as emeritus artistic director. Gass, however, rejected what he called "a ludicrous token position."