Ontario Superior Court Reluctant to Interfere in Sikh Temple Membership Dispute 
April 2021 Charity & NFP Law Update
Published on April 29, 2021

By Ryan M. Prendergast


Ontario’s Superior Court ruled that even a technical irregularity in following its by-laws should not invalidate the decision of a religious organization to make decisions about its membership. Affirming recent jurisprudence, Dhaliwal v Singh, is an October 7, 2020 judgment that upheld a Supreme Court of Canada precedent that courts should not interfere in questions of membership in a religious organization except where there is an underlying legal dispute to decide. The applicant was a director of a non-profit organization, Nanaksar Satsang Sabha of Ontario (“Nanaksar”), that operated a Sikh temple in Brampton. After his membership was terminated and he was removed as a director due to allegations of misappropriating funds, the applicant sued for court intervention to declare his removal invalid and to have both his membership and directorship reinstated. The court dismissed the application.

Nanaksar had three directors: the applicant, Lakhvir Dhaliwal; a respondent, Gurmeet Singh; and Gurmukh Hunjan, a third director, and Nanaksar’s president — initially a respondent in this case (but died March 3, 2020). According to the respondents, who had surveillance footage, Dhaliwal pocketed donation money without their consent on four occasions in January and February, 2019. The respondents sent the applicant a letter on May 12, 2019, advising him that, pursuant to Nanaksar’s by-laws, they were removing his membership and office as Treasurer, requesting that he return keys, documents and property. The letter noted that Dhaliwal could make written submissions and had 15 days before the final decision. Dhaliwal contended that he was authorized to pocket the donation to pay some debts of Nanaksar by Hunjan; the respondents denied any such authorization was given. Dhaliwal sent a response letter, stating they had “no authority” to terminate his membership or remove him as Treasurer. He refused to return anything. Dhaliwal did not attend a May 27th, 2019 meeting, where a resolution was passed terminating his membership, and a second resolution passed replacing him as a director. Under Nanaksar’s by-laws, to be a director required membership.

Dhaliwal argued “that Hunjan and Singh, illegitimately and wrongfully terminated the applicant’s membership, acted in bad faith and contrary to the principles of natural justice, procedural fairness, and good governance.” According to Dhaliwal’s reading of Nanaksar’s by-laws, the respondents failed to provide him with proper — seven days’ — notice of the May 27th meeting, as they only sent him a text message on May 22nd, five days prior. He also submitted evidence of instructions he received from Hunjan relevant to the four occasions on which he pocketed the donation money. Further, a failure to call an Annual General Meeting since 2015 precluded the election of directors, Dhaliwal argued.

The respondents argued that they complied with Nanaksar’s by-laws. They also argued that “Questions of membership in religious or voluntary associations are outside the jurisdiction of” the court. They also stated that the video footage “speaks for itself.”

Justice Thomas A. Bielby did not decide on the question of whether Dhaliwal was or was not misappropriating donations. Rather, the judgment focused on the issue of whether the respondents acted within their authority when they terminated Dhaliwal’s membership. Reviewing the Corporations Act, sections 127.2(1) and 129(1), Bielby J considered the statute “a vehicle by which members can make a change” and for directors “to pass by-laws, to regulate the qualifications of membership, and the ability to suspend and terminate memberships.” Citing Highwood Congregation of Jehovah’s Witnesses (Judicial Committee) v Wall, 2018 SCC 26, Bielby J adopted as part of his reasons that courts will not intervene in decisions of membership in a religious organization “ ‘save where it is necessary to resolve underlying legal dispute’ (para. 39).” From what was presented, Bielby J considered that the respondents had evidence on which to base their decision, stating they “were in a better position to judge than this court and the court should be reluctant to interfere.” Nanaksar’s by-laws set out the mechanism and procedure by which the board could terminate membership. While the notice of the May 27th meeting may have “lacked formality” according to Bielby J, “the court ought not to interfere in breaches said to be technical in nature.” The procedure set out in Nanaksar’s by-laws was “effectively, met.” Ruling that the respondents were within their authority to terminate Dhaliwal’s membership, Bielby J further concluded that, by operation of the by-laws, his “appointment as a director was automatically vacated”.


Read the April 2021 Charity & NFP Law Update