The Hyack Festival Association has been unable to pay a wrongful dismissal settlement to its former executive director because its bank accounts have been frozen.
The saga began in July, when four Hyack executive members fired executive director Douglas Smith without getting approval from the board of directors. The board of directors rehired Smith, who later left and negotiated a wrongful dismissal settlement.
“We reached a settlement with Hyack for the wrongful dismissal quite some time ago, back in October,” Smith told The Record Dec. 18. “Once you reach a settlement you are obligated to pay. They have refused to pay. There has been no payment received for the wrongful dismissal.”
Smith said the Hyack Festival Association has given no reason for the nonpayment of the funds that had been promised. Because Hyack has “not responded to our efforts to receive payment," Smith said he is the midst of commencing a claim against the organization.
“There has been no effort on their part to make payment. They have a frozen bank account. They are not meeting that obligation, obviously,” he said. “From our standpoint, the next question becomes, why would the city in January grant them any funding when they still haven’t settled up with me, because then you could potentially be using public money to settle up with a former employee.”
Gavin Palmer, president of the Hyack Festival Association, attributed the nonpayment to “some of the manoeuvres” by Smith and his supporters, which resulted in the bank freezing Hyack’s account.
“There were some questions regarding authenticity of the current board, which was triggered by Douglas Smith and his cohorts. They took some paperwork to the bank and the bank shut our bank account down,” he told The Record by phone from Maui. “He caused the problem, he should take steps to fix it.”
Asked what those steps would be, Palmer said Smith should meet with other directors of Hyack and have them verify the fact that the existing board is legitimate.
“He and the other directors created a problem. They locked our bank accounts up,” he said. “They created a problem and they have to resolve it.”
Until the board gets recognized, Palmer said there isn’t much it can do to rectify the situation. He assumes the payment would be made once Hyack has access to its accounts, as an agreement was made with Smith.
New Westminster city council questioned the legitimacy of the board in October, after a series of actions by the two factions of the board of directors. Each faction submitted motions that were to be considered at a special general meeting on Oct. 22, with each side calling for the removal of members on the other side of the debate.
When five Hyack board directors resigned on the morning of the Oct. 22 meeting, the Hyack executive cancelled the special general meeting and held a board meeting, where they filled the five vacancies with new board members. However, about 25 people attended the venue and voted to remove the three executives from the board.
In response to the ongoing dispute, city council approved four recommendations concerning the embattled organization: to request all financial records and procedures from the organization so it can conduct an independent audit; to contact the registrar of B.C. Societies to investigate the conduct of the Hyack Festival Association; to administer this year’s Santa Claus Parade of Lights and other events remaining in the association’s 2013 granting process; and to suspend any future funding to the association until these governance matters are resolved to the satisfaction of the city.
Jan Gibson, the city’s acting director of legislative services, told The Record that the city has received a reply from the registrar of societies, but because the matter is still before council, the letter hasn’t been made public.
“My understanding is that council is still dealing with the matter,” she told The Record on Dec. 17. “I believe that staff will give an update at a meeting coming up in January on any actions taken on the resolutions that they made in public at the October meeting.”
In related news, the Hyack Festival Association announced a soft launch of a new logo and name for the organization – Festivals New West. The name is being protected until the governance issues are resolved.
“Until the board gets recognized, we can’t do very much,” Palmer said.
