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Claimants have until Oct. 11 to submit their claims.

PwC launching claims process for SFUO, UOSU attempts to access health care plan funds in separate proceedings

The now-defunct Student Federation of the University of Ottawa (SFUO) allegedly owes around 100 claimants approximately $1 million, according to their court-appointed receiver PricewaterhouseCoopers (PwC) who is set to launch a claims process. 

About a quarter of the people owed money are students, a lawyer for PwC said at the Ottawa courthouse on Monday. A court order to start a claims process was granted Wednesday by Justice Kershman of the Ontario Superior Court of Justice. 

PwC partner Mica Arlette said he would “not publicly identify these parties or the potential nature of their claims” in an emailed statement to the Fulcrum on Sept. 19. But it is outlined where the claims may come from in a series of four court reports published prior to the order granting a claims process. 

The SFUO owes about $200,000 to its general unsecured creditors, according to the third court report dated Aug. 16. Also included is an alleged claim for severance and termination payments from the SFUO’s former executive director and human resources assistant/services coordinator, amounting to $400,000. 

Four other potential sources of claims are laid out in the third report. 

Among these is a claim from the landlord of Agora Bookstore tied to the termination of the lease for the property, the amount of which is yet to be determined, and potential severance and termination claims from former SFUO employees not hired by the UOSU.

The court order mentions CUPE 4943 — the union representing some of the staff of the SFUO — may submit an omnibus claim on behalf of its members.

Also included in the third report are “contingent claims” launched prior to the receivership proceedings and “other miscellaneous creditor claims” under review by PwC. 

Prior to being appointed by the court as the SFUO’s receiver, PwC was working with the student union to help with their transition over to the University of Ottawa Students’ Union (UOSU).

PwC says proven claims will be addressed by separate court order and if the total value of all proven claims exceeds the value of the SFUO’s realizable assets, claimants may not receive the full value of their claim.

“If the total claims proven in the claims procedure exceed these funds, the proven claims would be paid on a pro-rata (in proportion) basis according to any priorities asserted,” Arlette added in his email statement.

Inside the claims process 

Claimants will have until Oct. 11 at 5 p.m.to submit a claim. In order to do so, claimants are asked to submit the amount and description of transactions along with any supporting documentation relating to the claim, such as invoices.

PwC will have until Oct. 22 to revise or disallow a claim. From there, claimants will have until Nov. 1 to deliver a written objection to a notice of revision or disallowance from PwC and until Nov. 26 to serve and file a notice of objection motion. 

If PwC does not receive proof of claim by the Oct. 11 deadline, “the claim will be forever barred and extinguished,” according to the claims procedure notice.  

PwC is required to mail the claim document package to each known creditor by Sept. 20 at 5 p.m. They’re also required to place the legal notice in both the Ottawa Citizen and Le Droit, and online in the Fulcrum (see below) and La Rotonde, by Sept. 23 at 5 p.m.

Editor’s note: Ads or legal notices are not endorsed by the Fulcrum’s editorial board.

The court reports also shed light on the state of the SFUO’s finances. 

“The financial records of the SFUO are in significant arrears,” PwC writes in its first court report dated April 29 and amended April 30.

No external audit of the SFUO’s financial statements was conducted after April 30 of 2017 and no budget was prepared for the 2018/19 period, according to the report. 

The SFUO also didn’t update their accounts payable sub-ledger “for some time,” and “SFUO accounting staff have been unable to provide a complete listing of amounts owing to creditors,” the report states.    

Green Shield Canada (GSC) health care plan reserves

GSC is a not-for-profit benefits carrier that has offered a prepaid health care plan to the undergraduate student body at the U of O since 2010, with the SFUO as the plan’s sponsor.

On April 25, the UOSU filed a statement of claim against GSC in a separate proceeding, laying claim to reserve funds in the health care plan that totalled approximately $1.43 million as of Aug. 31, 2018.

The UOSU says the reserve funds should represent a trust for the benefit of U of O students.

“We maintain that the SFUO held those funds in trust, and therefore the reserve fund belongs to the students of the U of O rather than to the SFUO,” UOSU advocacy commissioner Sam Schroeder said in an emailed statement Thursday. “Money that students paid into their health and dental plan should be used to ensure the stability of their health plan, rather than being used to pay off the SFUO’s debts.”

But according to Arlette, “the benefit plan reserves issue concerns the entitlement of the SFUO to the cash reserves remaining (if any) in the benefit plan now that the plan sponsored by the SFUO has terminated.”

These reserve funds are made up of about $408,000 in a claims fluctuation reserve and just over $1.022 million in a surplus account reserve. 

In their statement of claim, the UOSU proposed an order that “any deficits in revenue incurred in the Green Shield Canada Group Benefit plan during the 2018-19 and 2019-20 benefit period be paid from reserve funds held by Green Shield.”

In the first court report, it’s made clear that the issue of the GSC reserves will be resolved after PwC’s claims process is complete.

What’s next?

The UOSU and PwC are set to meet on Nov. 4 for mediation in an attempt to resolve the health care reserves issue, according to an email from PwC’s legal counsel attached to the fourth report dated Sept. 13.

The fourth report adds PwC and the UOSU have set a court date with a bilingual judge for Jan. 31, 2020 to litigate the issue if mediation is not successful.

This article will be updated as new information becomes available. If you are a claimant and would like to share more information, email editor@thefulcrum.ca

Editor’s note (19/09/19, 4:42 p.m.): Updated to include comment from UOSU advocacy commissioner Sam Schroeder.