The Land Conservancy of B.C. has been ordered by B.C.’s Court of Appeal to transfer ownership of West Vancouver’s Binning House, a National Historic Site, back to the estate of its deceased owner.
This decision is a “real blow” to TLC, said John Shields, director of operations for the Victoria-based conservation organization. TLC is in court-ordered protection from creditors and its original debt of
$7.5 million has climbed.
Losing the appeal worsens its financial situation.
TLC has now lost the value of the house. It had been offered $1.6 million for the property.
It is also responsible for legal costs in the original challenge of more than $300,000, TLC board member Briony Penn said.
The total current debt is not being released. Shields would only say the debt is “up a little bit.”
Since creditor protection began in fall 2013, some property sales have been completed, two loans were paid down and part of the professional fees have been covered, he said.
But $1.285 million is owing for professional fees, such as lawyers, and that figure is growing, according to a Nov. 18 affidavit from court-appointed monitor Gordon McMorran. So far, $510,000 has gone to lawyers and other services, he said.
TLC is in the midst of a complex situation as it tries to sell some properties, transfer others to conservation groups, manage debt and deal with creditors.
Its efforts to sell the 1941 Binning House, an early example of modern architecture in Canada, were blocked in court. The house was designed by the late artist B.C. Binning.
His widow, Jessie Binning, died in 2007 and wanted the house preserved. Trustees of her estate transferred the house to a new society that immediately gave it to TLC, which has held it since 2008.
After TLC received an offer for the house, the University of British Columbia, also a beneficiary under Jessie Binning’s will, challenged TLC’s entitlement to the property in court.
A B.C. Supreme Court judge dismissed UBC’s application and the university appealed. The TLC lost and has now been ordered to transfer the house back to Jessie Binning’s estate. The fate of the house, which has backers from across the country, is unclear.
Trustees of the estate acted in good faith, the court of appeal said. But in ruling the sale void, the judge called it a “fraud on the power given to the trustees in the will.”
Costs of the appeal for UBC and TLC are to be paid from the estate, the court said.
Meanwhile, the TLC is going to B.C. Supreme Court on Dec. 15 with a plan that includes transferring some property to other land trusts in exchange for donations, Shields said. “These properties shouldn’t be on the market,” he said. “They shouldn’t be offered for housing developments or whatever.”
TLC is also proposing creditors accept a lower amount than owed and a tax receipt for the difference, he said. If approved by the court, a creditors’ meeting will be held. In this case, many creditors are individuals who lent money to the organization to help acquire land.
TLC held its annual general meeting last weekend. A motion was passed endorsing striving to pay creditors to the fullest extent possible and also work to protect properties, Shields said.
