Minutes of the a Special Meeting held on Monday, February 7, 2000.

 All members save Marie Mellon and Gaston Sauvé being in attendance, the meeting commenced at 2:15 p.m. with the approval of the minutes of the meetings of December 2nd and 16th  before turning to the sole matter for which it had been convened, namely, the measures we should take regarding pension plan surplus in light of the fact that the Board of Governors has established an ad hoc sub-committee to make an “objective” assessment of the PPC pension plan reform proposal. The following summary of the discussions that took place during this important meeting obviously does not purport to be a verbatim transcript.

 Maurice Jetté began by observing that amongst the stated major concerns of the Board and its ad hoc sub-committee are the issues of ownership of the surplus and the fiduciary obligations of Board members, regarding which it is now clear that the Board will be seeking external legal advice. Inasmuch as the PPC proposal was not approved by the Board as its authors had anticipated, and it being far from certain that (with or without our endorsement) it ever will be, there is a pressing need to state our case. He went on to comment on the meeting he and Bert Hubbard had last December with Bill Sammon (of Sammon, Barnes) whose legal opinion of January 27, 1999, was read and discussed at length.

 B. Hubbard then presented two alternative draft memoranda prepared for the consideration of the Committee in light of the Sammon opinion, their purpose being to inform the Board as to what we believe our rights to be in respect of the surplus and to seek a response within a reasonable time. The “first draft” was a firm and detailed assertion of our rights which, while made without express reference to concessions, it was hopefully expected would lead to meaningful discussions in which retirees would cease to be a relatively unimportant fringe element as has been the case until now. The failure of the “second draft” to articulate the premises upon which our rights are based rendered it less forceful and, in concluding with a “hat in hand-ish” plea for a “fairer share” of the surplus, it would require us to negotiate from a position of weakness even assuming we were invited to the table.

 Following this introduction, these alternative memoranda were read over, fully discussed and, pending final approval, certain amendments to the text of each were agreed upon. However, a decision as to which, if either of them, might be adopted, was held in abeyance in order to debate the following motion made and seconded by Gordon Boreham and Marie Mellon, which was tabled at the December 16th meeting, namely, that the Administrative Committee of APRUO formally endorse the current PPC proposal and inform the Board of Governors of our support for it.

 Speaking at length in favour of that motion, G. Boreham characterized the memoranda previously under consideration as “legalistic”, and he urged a more “political” approach. In his view, taking the “legal route” would likely lead to the rejection of the PPC proposal and require that committee to begin its work afresh. For the sake of clarification, B. Hubbard pointed out that the “legal route” is litigation, whereas to state as a basis of negotiation what one believes to be one’s rights, legal or moral, is an intrinsic part of any “political” process.

 G. Boreham reminded the meeting that 90% of respondents to the survey regarding the PPC proposal had voted to accept it, and he urged that we do nothing to prejudice its successful conclusion. It was his opinion that if we asked for so much as one dollar more than allotted to us thereunder that proposal would be lost.

 In response, M. Jetté said that a growing number of our members who voted in favour of it have changed their minds, while many others complain that they did not fully understand the lengthy and complex package of material that accompanied their ballot form, the greatest single source of dissatisfaction being that, while the contribution holiday enjoyed by active members is not deducted from their share of surplus, the $5M we received is to be deducted from our share. Moreover, if the Board obtains an outside legal opinion (as it is virtually certain to do) it is unlikely to be substantially different than the advice we have obtained, in which case the Board will know that its approval of the present PPC proposal would be a breach of trust. Thus, it is likely to deny approval of that proposal regardless of what we do. However, B. Hubbard went on to explain that this does not mean the Board has no obligation to retired members regarding the surplus. Indeed, at the very least, according to the legal opinion we have received it would appear that the trustees must provide retired members with an annual share of the surplus equivalent to the benefit enjoyed by active members as a result of their ongoing pension contribution holiday. To endorse the PPC proposal is not to follow a “political” route to reasonable compromise; it is to capitulate. And, to address the Board in the form of one of the memoranda previously considered is not to abandon compromise and commence litigation; it is to begin the process of negotiation. We may begin that process from a position of strength simply by stating clearly the basis upon which we believe our rights to be founded, or we may begin with a suggestion of willingness to accept far less.

 G. Boreham then advised the meeting that if his motion were defeated he would find it impossible to continue as a member of the Administrative Committee. The question was then called and, with only one vote in favour, the motion was defeated. In consequence, G. Boreham tendered his resignation from the Committee. Being unable to persuade him to reconsider, the Committee accepted his resignation with regret and he withdrew from the meeting.

 After further discussion Viateur Bergeron moved that the “first draft” memorandum as modified be approved and copies forwarded to the Board of Governors in due course. That motion, seconded by Bill Orban, carried unanimously.

 The meeting then adjourned at 4:45 p.m.
 

______________________
H. Albert Hubbard,
Secretary-Treasurer.
 

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