A Roman Catholic religious order renounced ownership of one of its most valuable properties in 1995, at a time when it was under immense pressure to sell its assets to pay for compensation to victims of sexual abuse at Newfoundland's Mount Cashel orphanage.
Eleven Christian Brothers from Mount Cashel have been convicted of abusing boys in their care in the 1970s. Shane Earle, the first victim to receive compensation, was awarded $400,000 in damages on Sept. 18, 1995.
Documents disclosed this week as part of a high-profile court case in British Columbia show that the Christian Brothers of Ireland in Canada, which ran the Mount Cashel orphanage, changed its position on ownership of Vancouver College in 1995.
Previously, the order maintained on several occasions that the popular kindergarten-to-Grade 12 boys school in Vancouver was run as a wholly-owned subsidiary.
But in its 1995 financial statement, the religious order took a different approach and maintained it did not own Vancouver College. Rather, the Christian Brothers stated its relationship to the college "is strictly in a management role."
Who owns Vancouver College, the Christian Brothers of Ireland in Canada or the local school community? The answer is crucial in figuring out whether the order has enough money to pay for settlements with the Mount Cashel victims that could run up to $36-million.
The Catholic order has declared that its assets amount to only $4.3-million, which would not cover the outstanding claims. However, if it owned Vancouver College and sold it, the Christian Brothers would likely have enough money.
The school, with a $5-million budget and enrolment of 945 students, is located on two blocks in Shaughnessy, the city's most expensive residental neighbourhood. The property has been estimated to be worth about $30-million.
In British Columbia Supreme Court this week, Vancouver lawyer George Macintosh, who is representing Vancouver College, said the Christian Brothers was registered as owner of the school "for the sole purpose of the school being established and continuing as a permanent educational institution."
The only issue to be decided by the court, he said, is whether the Christian Brothers is holding ownership in a trust that was created when the school was opened in 1927.
If a trust, with the specific charitable purpose of running the school, was formed, then that is the end of the dispute, Mr. Macintosh said. The Christian Brothers would be regarded as trustee and have no right of ownership.
But if a trust was not formed in 1927, then it will likely be the end of Vancouver College, and the liquidator will likely be able to seize the school and sell it, he added.
Documents submitted to court show that the Christian Brothers assumed it was the owner until the order was in the midst of dealing with the issue of compensation for Mount Cashel.
In a report dated August, 1991, on the financial and liability considerations of the Mount Cashel cases, the religious order clearly states that a corporate entity was set up to operate Vancouver College but the shares of the company were owned by the Christian Brothers of Ireland in Canada.
In corespondence dated December, 1993, the Christian Brothers instructs its solicitor to review the order's rights and the implications for it as owner of the college.
In the following month, Ron Walsh, chairman of the school's board of directors, refers -- in a confidental report to the board -- to the Christian Brothers as the owner of the school.
John Nixon, a spokesman for Vancouver College, said outside the courtroom that the Christian Brothers had misunderstood its relationship with Vancouver College.