The B.C. Supreme Court has blocked an attempt by current members of the B.C. Tree Fruits Co-operative to prevent its former growers from receiving millions of dollars that were left over after the Okanagan co-op sold off its assets to pay its creditors.
In a decision released Thursday, Justice Miriam Gropper ordered that former members must be included in the distribution of the surplus funds.
The ruling stops current members from holding a vote that would have changed the co-operative’s rules to exclude former members from receiving any share of that money.
“The proposed resolution qualifies as oppressive conduct,” Gropper wrote, calling it “burdensome, harsh, and wrongful” and “a visible departure from standards of fair dealing and an abuse of power.”
B.C. Tree Fruits was founded as a co-operative in 1936 and over the decades it grew to represent more than 230 farming families and included a grower supply company, a fresh fruit market in Kelowna and, in 2014, a craft cider company branded with the B.C. Tree Fruits logo.
Due to low fruit volumes and severe weather impacts, the 88-year-old co-operative announced it was ceasing operations in July 2024 and sought court direction to liquidate assets.
Assets belonging to the co-op have since been sold off, including one of its main cold storage facilities, which was purchased by a pharmaceuticals group.
After paying creditors, about $12 million to $15 million remains for distribution to members, according to the court.
Under the co-operative’s existing Rule 125, both current and former members are entitled to 68 per cent and 32 per cent of those funds respectively, which according to the court would equate to about $4 million in funds for the former members.
On July 9, 2025, however, 38 current members asked the co-operative’s board to call a special general meeting to pass a resolution that would delete Rule 125.
Former members challenged the proposed change in court, arguing they had contributed to building the co-operative’s assets over decades and had a reasonable expectation they would share in any surplus.
Gropper agreed, ruling former members had a clear financial interest and were entitled to legal protection.
“[They] had reasonable expectations that each would share in the distribution of any surplus,” she wrote.
The decision also outlines competing claims about what led to the co-operative’s financial collapse. Amarjit Singh Lalli, the representative for current members, said the departure of former members from the co-operative reduced revenue, increased costs and, in some cases, involved breaches of fruit supply agreements.
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But an affidavit from the co-op’s interim chief executive officer and chief financial officer pointed to a “staggering” drop in apple volumes, saying current members withheld crop estimates amid disputes with leadership, making it difficult to budget and plan for the 2024 season.
Gropper said she could not determine whether current or former members caused the collapse, stating that it was “confluence of factors,” that led to it. She said the record did not support the explanation that former members were to blame in a way that justified excluding them from the surplus.
Gropper ruled there was no valid explanation for excluding former members other than the financial benefit to current members.
“There is no explanation … beyond that the current members … do not wish to share the surplus funds with the former members, because it means more money for each of the current members.”
The court ordered the co-operative to follow the existing rule and distribute surplus funds to both current and former members.
As of September last year, B.C. Tree Fruits is under the ownership of Wildstone Construction Group and under the management of Ontario-based Algoma Orchards.
