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Babur Ilchi

University fires back as MacHall ownership dispute intensifies

By Fabian Mayer, September 24 2015 —

The University of Calgary responded to the new information made public by the Students’ Union in the dispute  over the management and ownership of MacHall.

In an open letter sent to the SU on Sept. 22, provost Dru Marshall said the university was “disappointed with the SU’s starting position for negotiations this fall and its threat of legal action.”

The letter was a response to an SU e-mail that sought to lay down some ground rules in negotiations for a new MacHall operating agreement. SU president Levi Nilson was disappointed by the university’s delayed response.

“It took them 13 days to respond to an e-mail that had some basic things in it that I’ve not only asked for, but [my predecessors] asked for,” Nilson said.

The university also pointed out that the current License of Occupation, Operating and Management Agreement signed in 1999 identifies the university as the owner of MacHall in article 4.1 of the document.

The SU believes this clause was drafted in error and points to the original 1969 agreement, which gives the SU 55 per cent ownership and the university 45 per cent.

The SU filed a statement of claim with the provincial courts on April 28, 2015, but Nilson said they have yet to serve it to the university. He believes that if a deal can not be reached the dispute will likely be settled in court.

Nilson made the dispute public last week after the first negotiation session of the year with university administration did not go well.

“It was clear that we’re kind of losing hope in getting a deal,” Nilson said. “We still want to go back to the table, but we don’t think that having it behind closed doors will be productive anymore.”

Marshall could not be reached for comment.

Nilson believes the SU has a strong case for majority ownership of MacHall and claims it is seeking an agreement that reflects that.

“Finding ownership kind of changed things in the way that we would get a deal,” Nilson said. “A lot of what the university is asking for would make our rights and responsibilities less within the building.”

Nilson said one of the ground rules outlined in their original e-mail was that the agreement needed to be detailed and unambiguous. According to Nilson, the university has not been receptive to that demand.

“That’s one of the things that I don’t understand that the university wouldn’t want,” Nilson said.  “The more clarity, the better, in our opinion.”

Negotiations on a new operating agreement for MacHall started two-and-a-half years ago when the current operating agreement was set to expire. The current agreement expires on Dec. 9 of this year. Nilson isn’t sure what will happen if a deal isn’t reached between now and then, but said it would put the SU and the services it provides at risk.

In Marshall’s letter, she said the university would be willing to extend the existing agreement until May 1, 2016. However, that extension will be rescinded if the SU decides to take legal action.

Marshall claims the SU would have the option of retaining the spaces it currently occupies.

According to the SU, they have invested $19,025,000 in the building since 1969 compared to the university’s $3,500,000.

“We have a pretty strong set of facts on our side as far as ownership goes and we think it’s fair that students know about it,” Nilson said.

The SU has managed MacHall for over 40 years with lease agreements renegotiated periodically. Much of the union’s revenue comes from operating the building. As a result, U of C students pay some of the lowest union fees in the country.

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