Denman Island retreat members sue former board over land sale

Members of a Buddhist retreat centre on Denman Island that went bankrupt during COVID are suing board members and others for selling the centre without informing or consulting the membership.

The Dharma Fellowship of B.C. alleges in B.C. Supreme Court that board members, including founders Rodney and Elizabeth (Lisa) Devenish, failed to follow required procedure under the B.C. Societies Act when they voted to wind up and sell the assets of the society.

They allege that the large parcel of land — about one-quarter of a square kilometre — referred to as a hermitage, which the claim says was in a “remote and beautiful location” and had “unique features,” was sold for less than half of what it's worth, or $400,000.

The hermitage included a Buddhist stupa, a rounded structure for keeping religious relics that offered a sacred space for meditation, and a main house, a bathhouse, library, cabins, yurts, a barn, orchards and garden.

In 2022, it was valued at $900,000 by B.C. Assessment, according to the lawsuit. In 2023, the assessed value of the land, which is part of B.C.'s Agricultural Land Reserve and therefore has limited uses, was $1.1 million.

The members of the defunct fellowship also allege board members benefited directly from the proceeds of the sale and were in a conflict of interest when they voted for the sale.

Named as defendants in the claim are the Devenishes of Victoria, Robert Hood of San Francisco, Darlene Tataryn of Selkirk, Man., Monica Mueller of Denman Island, and the Crystal Mountain Society for Eastern and Western Studies, which has property on Galiano Island.

The four board members, the Devenishes, Hood and Tataryn, voted in 2022 to sell the property to Monica Mueller, a 2021 board member and student of Rodney Devenish and friends of him and his wife, for the $400,000, according to the lawsuit.

At the time of the sale, the Devenishes had a charge against the title of $150,000, and Hood had one for $136,000, both of which were paid to them, and the board later disposed of the remaining funds by giving about $77,000 to the Crystal Mountain Society and monthly stipends to Lisa Devenish, it said.

Because the three had a “material interest in the sale,” that “materially conflicted” with their duties to the society as members of the board, the lawsuit alleges.

They didn't disclose their interest, refrain from voting on or influencing the board's discussion on resolutions in which they had a conflict of interest as required under the B.C. Societies Act, it alleges.

The board then “purported to dissolve the society, claiming insolvency,” it said.

The act or the society's bylaws require the board to seek consent of the members through a resolution at a general meeting and to dissolve and liquidate assets under the act's protocols, it said.

The members of the society were not aware of the sale, distribution of funds from the sale and other assets and dissolution of the society, it said.

The claim also said the board failed to appoint a liquidator as required, and the executive sold the lands, disposed of assets and dissolved the society and had its income tax status revoked, all without proper authority.

The society has suffered loss and damages because of lost assets, including the hermitage, lost revenue, exposure to financial liabilities and the cost of restoring the society and its assets, it said.

It's seeking an order to restore the money and lands to the society plus unspecified general damages.

The lawsuit has not been tested in court. Typically, the next step is for the defendants to file a response.