Fulfilling fiduciary duty

News of UTSU’s lawsuit raises questions about what other problems may exist

Last week’s news of the legal case UTSU filed against its former president, VP internal, and executive director brings to the fore an important obligation shared by student representatives across the board: fiduciary duty.

According to the Legal Information Institute at Cornell Law School in New York, fiduciary duty is defined as “a legal duty to act solely in another party’s interests”.

For instance, student union executives are responsible for acting in the best interests of the members of their union (including all full-time undergraduate students at UTM and St. George) including in the way that they handle levy funds provided by the same members.

Obviously, the presence of the lawsuit calls into question whether last year’s executives and executive director fulfilled this obligation, calling on the defendants to pay $200,000 for an alleged “breach of fiduciary duty”.

In Yolen Bollo-Kamara’s comment to The Medium in our cover story, she suggests the opposite.

“I want to be very clear that I made a decision that I believed to be in the best interest of the students who elected me, and I did not benefit personally from this in any way,” she says.

Until the case is actually heard, we’ll have no definitive answers on what actually happened.

But what’s also interesting is the coincidental reference to fiduciary duty by another student union representative this week.

Referring to the levy funds for the UTMSU Food Centre, UTMSU VP internal Francesco Otello-DeLuca defends how the union has significantly underspent the funding for several years, and then carried over the leftover amount into its general operating budget at the end of the year.

If you missed when we reported on it two weeks ago, the UTMSU Food Centre is funded by a levy that students agreed to pay through a referendum. That referendum asked students if they agreed to pay the levy for the explicit purpose of supporting the campus food bank.

Otello-DeLuca, however argues, “If we do not have so much demand to require an increase in allocation [of funding for the food bank budget], we have fiduciary responsibility to allocate the unspent resources to the operating budget pending future decisions by the elected members of the board of directors.”

According to that logic, it is okay —and in fact responsible—for UTMSU to deliberately allocate only a portion of the funding from the food centre levy to the food centre, if there’s not enough demand for the food centre’s services.

Well, as this week’s story on the food centre points out, there’s been a dramatic rise in the use of its services in 2014. At the same time, over a third of its budget was left unspent in 2014/15. I’m skeptical that that was in the best interests of UTMSU members.

And as long as we don’t know how the rest of that funding ends up being spent, we won’t be able to call that fiduciary responsibility.

Yes, the lawsuit downtown is a major development for all of us. But perhaps it’s only a sneak peek into problems that remain as yet unexplored.


Leave a reply

Please enter your comment!
Please enter your name here