Fourth and Long: B.C. Supreme Court Rejects Players’ Injunction Application to Reverse Simon Fraser University’s Decision to Discontinue its Football Program

Fourth and Long: B.C. Supreme Court Rejects Players’ Injunction Application to Reverse Simon Fraser University’s Decision to Discontinue its Football Program

Introduction

In a recent decision of Kremler v Simon Fraser University, 2023 BCSC 805 dismissing an application for an interlocutory injunction, the British Columbia Supreme Court confirms the high threshold that an applicant is required to meet in relation to the merits of their claim on such an application. The Court also cautions that relief sought on a mandatory injunction is inappropriate where it would be akin to a court order for a party to “compel the running of a business”.

Five student athletes from Simon Fraser University’s (“SFU”) football program applied for an injunction to reverse SFU’s decision to cancel its football program on the basis that SFU’s decision to do so constituted breach of contract and negligent misrepresentation.

The Court dismissed the application, holding that the plaintiffs did not satisfy the higher burden of a strong prima facie case that a mandatory injunction requires as the first hurdle of the application.

Facts

Since 2010, SFU’s varsity football team participated in the National Collegiate Athletic Association (“NCAA”) Division. In recent years, SFU’s football team was also a member of NCAA Division II’s Lone Star Conference. However, on January 25, 2023, the Lone Star Conference informed SFU that it decided not to renew SFU’s affiliate membership after the 2023-2024 season (the “Lone Star Decision”).

SFU claimed that the Lone Star Decision led to immediate and serious challenges. Although SFU considered alternative conferences and organizations, including other NCAA Division II conferences, NCAA Division III, the National Association of Intercollegiate Athletics and USports, these alternatives were not feasible for a variety of reasons. Additionally, SFU had difficulties recruiting incoming players and additional coaches for its football program following the Lone Star Decision. SFU was further concerned regarding the potential for significant injuries if it failed to recruit a full and competent football team.

Accordingly, on April 4, 2023, SFU informed its players that it was immediately terminating its football program and its football coaching personnel’s contracts and that it would not hold a 2023 football season.

On April 13, 2023, the plaintiffs filed a claim and an application for an interlocutory injunction against SFU. The plaintiffs claimed that SFU was liable for breach of contract and negligent misrepresentation associated with the termination of its football program.

The Plaintiffs’ Arguments

The plaintiffs sought an interlocutory injunction. The orders sought included the following:

1. reinstating all student athletes who were part of SFU’s football program as of April 4, 2023;
2. reinstating all coaching personnel who were part of SFU’s football program as of April 4, 2023 and reinstating all coaching personnel contracts immediately;
3. that SFU take all reasonable steps to, in good faith, apply to university football conferences in Canada and the United States for its football program to compete in the 2023 season; and
4. in the alternative, that SFU take all reasonable steps to allow its football program to continue independently from a university football conference in Canada or the United States.

The plaintiffs alleged that certain oral contracts existed between the plaintiffs and SFU coaching staff (the “Alleged Recruitment Contracts”). The plaintiffs claimed that coaching staff recruited them with promises of an opportunity to earn a Canadian post-secondary education while playing football in the NCAA. The plaintiffs also alleged that SFU provided certain players with scholarships to induce them to attend SFU. In reliance on SFU’s commitments, the plaintiffs claimed they entered a contract and agreed to attend SFU, devote their skills to the SFU football program and forgo opportunities to play football at other schools. Additionally, the plaintiffs argued that they had a sufficient number of committed players to form a competitive and safe team if SFU’s football program was reinstated.

The plaintiffs claimed that the key terms of the Alleged Recruitment Contracts included:

1.  the plaintiffs would receive acceptance to SFU for their academic studies;
2. the plaintiffs would take all reasonable steps to remain academically eligible to continue attending SFU and to play on its NCAA football team;
3. SFU would provide roster spots on its NCAA football team for the plaintiffs as long as the plaintiffs remained eligible;
4. the plaintiffs would take all reasonable steps to remain fit to play on SFU’s NCAA football team; and
5. the SFU football program would not be eliminated without reasonable notice to the plaintiffs.

The Defendant’s Arguments

In response to the plaintiffs’ application, SFU argued that a competitive and safe football season was not possible. SFU claimed that its assessment of the circumstances was realistic and it had concerns that fewer players and coaches would lead to a significant risk of injury. Additionally, SFU further submitted that it was unclear whether its insurance policy would cover a court-ordered football program.

SFU submitted evidence challenging the plaintiffs’ claim for breach of contract and negligent misrepresentation. SFU’s senior director of athletics and recreation provided evidence that there was a considerably lower number of available players to form a competitive and safe team. Additionally, an affidavit of the SFU coach, which the plaintiffs relied on, did not reference a promise to the players. Rather, the affidavit provided that the SFU coach would give the plaintiffs an opportunity to play in the NCAA, which did not fully represent a commitment to the players. In addition to the evidence submitted by SFU, signed written documents between the parties did not reference the existence of the Alleged Recruitment Contracts.

Analysis

The Court set out the well-known three-part test for an interlocutory injunction, which requires that:

1. there is a serious question to be determined;
2. irreparable harm would occur to the applicant if the injunction was refused; and
3. the balance of convenience favours the injunction.

Given that the plaintiffs were seeking to compel SFU to take certain actions (i.e., a mandatory injunction), the plaintiffs were required to show a strong prima facie case, instead of a serious question to be tried.

The Court held that the plaintiffs did not show a strong prima facie case, for various reasons, including that:

1. While each of the plaintiffs entered into written contracts with SFU, such documents did not mention the Alleged Recruitment Contracts, meaning that the Alleged Recruitment Contracts would have to constitute oral side agreements;
2. The SFU coach did not provide evidence that he made a promise to the plaintiffs and instead his evidence was that players would be given an “opportunity to play competitive football in the NCAA”. This wording was found to be ambiguous and short of a promise to play varsity football at SFU, as is alleged to have existed in the Alleged Recruitment Contracts;
3. The plaintiffs’ ability to voluntarily withdraw from the program undermined their argument that the promise to play football at SFU constituted consideration for the Alleged Recruitment Contracts; and
4. To the extent that the plaintiffs relied on negligent misrepresentation, their reliance was on future facts and circumstances (i.e., the future running of a varsity football program and providing reasonable notice of termination of such a program). Generally, a representation of future facts or circumstances cannot ground an action in misrepresentation.

Despite finding that the plaintiffs failed to make out a strong prima facie case, the Court went on to consider whether the balance of convenience favoured the plaintiffs or SFU. The Court held that the balance of convenience was in favour of SFU. In coming to this conclusion, the Court considered the lack of strength of the plaintiffs’ case, SFU’s concern that it would have fewer players to field a full varsity football team, SFU’s concern for the risk of player injuries if a 2023-2024 season occurred and SFU’s concern that the football program may not be covered by insurance.

Lastly, the Court identified significant concerns regarding the appropriateness of the relief sought. The Court noted that the orders sought were vague and would create uncertainty as to whether they were complied with, if the injunction was granted.

Further, making the orders sought more precise would require judicial supervision and potential micromanagement, making the plaintiffs’ requested relief “akin to a court order for a party to ‘compel the running of a business’”, which the Court noted was not appropriate relief for a mandatory injunction.

The Court exercised its discretion and departed from the usual costs rule, ordering that each party bear its own costs of the application.

Takeaways

While the circumstances underlying this case are unique, this decision has important applicability to commercial litigation. Specifically, this decision serves as a reminder that in relation to mandatory interlocutory injunctions:

1. the standard that applicant must meet when seeking a mandatory injunction is onerous;
2. the terms of the order sought must be drafted with precision; and
3. applicants must carefully consider whether the effect of the order sought would be to compel the other party to “run a business” or require ongoing supervision or “micromanaging” by the court, which is not appropriate relief.

by Carina Chiu, Cole Bailey, Anica Villamayor (Temporary Articled Student)

A Cautionary Note

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

© McMillan LLP 2023