Laurentian's restructuring snares Sudbury's art gallery – Sault Star

Article content

The Art Gallery of Sudbury is seeking to protect its assets, including artwork, as Laurentian University looks to unload the historic building that has housed the gallery since the late 1960s.

Article content

The Bell Mansion itself is now well over 100 years old (it was built in 1907) and occupies a prime lot on John Street, overlooking Bell Park.

Laurentian acquired the stately stone structure and its leafy grounds for a token $1 in 1969.

The property would be worth far more today and is one of the holdings the cash-strapped school wants to sell as it restructures through the Companies’ Creditors Arrangement Act.

“The monitor understands that LU intends on selling the Bell Mansion and may include it, or the proceeds of its sale(s), in the plan it will be presenting to its creditors,” states the latest report from Ernst & Young, appointed as third-party observer in the CCAA proceedings.

“The monitor also understands that LU is considering all of its options with respect to the assets of the art collection.”

The question of who owns which pieces of art, however, remains to be clarified, according to retired history professor and former AGS board member Dieter Buse.

“Some art was given to the gallery when it was the Laurentian University Museum and Arts Centre,” he said. “Some art was bought by LUMAC. Some art was given to the Art Gallery of Sudbury when it became independent in 1996 and some was bought by the Art Gallery of Sudbury.”

From his reading of the latest monitor’s report, issued on April 13, “they’ve jumbled that all together, as if there is only one collection,” said Buse. “That is inaccurate, illegal, and unethical.”

Further complicating the issue is an honest mistake made by AGS in submitting a claim last year as one of numerous creditors impacted by the Laurentian insolvency.

Article content

The $6.4-million claim included the Bell Mansion and its grounds, valued at $1.3 million, and artwork worth more than $4.8 million. But after filing the claim in July, AGS was informed in February that the claim was disallowed.

“The disallowance not only disallowed our monetary claim in full, but also included the statement in each case that the AGS had no rights to the assets,” said AGS director Demetra Christakos in an April 8 affidavit. “However, I noted that in the monitor’s reasons for denying the claim that it did not provide any supporting documentation or direct evidence to support its position. The monitor also made no finding as to who owned the assets in question.”

Christakos said she was “very surprised” by the monitor’s response. “However, the disallowance made it clear that we had to file a reply within a short period of time and we did so, again out of fear that by not doing so we would lose our opportunity to maintain our rights.”

The organization now wants to withdraw from the claims process but not sacrifice its rights to its assets in the process. 

“Having misunderstood the claims process order, the AGS, acting in good faith, filed the proof of claim as a pre-filing debt creditor,” a lawyer for the organization stated in an April 8 court filing. “Having only recently received legal counsel on this issue, it now realizes that its claim should be withdrawn.”

Christakos said she understood “the monitor’s position was that upon withdrawing the claim, the AGS lose not only the right to participate as a creditor in the plan, but all of its property rights in the assets which were referred to in that claim, even though Laurentian has at no time in recent memory taken any steps to contest the ownership of the assets.”

Article content

She said she was submitting her affidavit “in support of our motion to allow for the AGS to withdraw their claims in the claims process without waiving its rights in or to any of the assets.”

In its April 13 report, however, Ernst & Young said it was opposed to granting the request.

“It would be unfair to LU’s stakeholders and contrary to the purpose of the CCAA to allow AGS to withdraw the AGS claim and maintain its ability to assert a claim against LU after LU emerges from CCAA protection,” the firm wrote. “It is the monitor’s position that the relief sought by AGS in the motion should be denied.”

The monitor said it also “strongly refutes the suggestion in the Christakos affidavit that the application of the claims process to the AGS claim would somehow create a windfall for LU or that AGS has somehow compromised its rights (if any) to the assets by filing a proof of claim in the claims process.”

Ernst & Young was adamant that “no claimant loses its rights simply by filing a proof of claim.”

The art gallery is still looking to withdraw from the process, however, and will be in court again on May 2 to make its case.

“As the matter is still before the courts, I’m not able to provide public comment right now,” said Christakos, when contacted by The Star. “This isn’t a situation that can be resolved without the judge’s intervention.”

Meanwhile, as the director noted in her affidavit, the gallery “is open to the public and the AGS continues to care for the assets in largely the same way as it had prior to the commencement of the Laurentian CCAA proceedings.”

Article content

Apart from housing art, the building itself has cultural and architectural value.

“The Bell Mansion is one of the few heritage building that we have,” said Buse. “Not many people seem to know that in 1984 the city made it into an official heritage building, so it falls under the Ontario statutes that relate to that.”

That means any new owner would not be allowed to alter the structure or its exterior appearance without the approval of city council. “If someone wants to buy it, they still have to follow the rules,” he said.

Buse said he wrote to Laurentian president Robert Hache and the board of governors to remind them of this status but never received a reply, although he did get confirmation the letter had been received.

“So they are aware of this, and I’m sure the monitor in the CCAA process is also aware of it, because they have to have looked at the deed.”

Buse said the Bell Mansion was not, as some assume, part of the covenant that allowed for the establishment of Bell Park.

“That parkland was all donated back in 1926 by the Bells to the City of Sudbury,” he said. “That’s different than the Bell building, because that wasn’t given to anyone until Mrs. Bell died in 1954.”

The mansion was initially gifted to Memorial Hospital, he said, and subsequently passed to the Masons, who tried to make it into a clubhouse. “That didn’t work because they couldn’t get it rezoned, so the Masons gave it the chamber of commerce, and they decided in 1966 to make it a centennial project for Sudbury to have a museum and cultural centre.”

Article content

He said $100,000 was spent in renovations before the property was handed over to Laurentian in 1969 for $1.

There were conditions attached to this transfer, however, “which I think the present CCAA process is avoiding,” said Buse. “It said, very explicitly, that the renovated building is being given to Laurentian University for a cultural and arts centre. It has become the Art Gallery of Sudbury, but it was for cultural purposes.”

He said the relationship between Laurentian and the gallery is a “long and intricate one,” something he learned first-hand when part of his role as an academic administrator was to act as liaison between the university and the art gallery. Buse also served for four-plus years on the AGS board.

He said it was always something of a challenge to get LU to pay for repairs and renovations. “That’s illustrative of the problems,” he said. “The university has not maintained the building, even though they own it.”

If Laurentian’s plan is to sell the building to a private developer keen on creating condominiums or something of that nature, this would run contrary to original promise, said Buse.

“As part of the deal in 1969, the contract says the university may do as it wishes, but they have to keep to the spirit in which the gift was given.”

Buse fears the monitor in the CCAA proceedings and the lawyers for the university, being mostly non-Sudburians, have not fully taken this into account and may not care so much about the building’s place in the community.

Article content

“They have not considered the community in their decision-making,” he said. “Nor have the considered the spirit of the covenant, in this case. They have run roughshod over faculty rights and over the union, and now they are doing it with community property.”

The long-term plan for the Art Gallery of Sudbury is to join a new central library and other potential partners, including the Sudbury Theatre Centre, in a proposed downtown facility the city has dubbed Junction East.

The goal is to have this structure, spanning some 62,000 square feet, built by 2024 in the parking lot next to the current STC building on Shaughnessy Street.

In the meantime, Buse feels the current home of the AGS is more than adequate.

“We have a very good art gallery,” he said. “It’s not necessarily in the best place, in terms of accessibility and safety, and it would be nice to have a bigger building, but it’s not bad. People underestimate how well you can show art in the place, because it has two big exhibit rooms.”

Should Laurentian choose to sell the building, Buse said it should go to an organization involved in art and culture, as was the intention from the get-go.

“I think Laurentian should do the decent thing and sell it to someone for the symbolic $1 it bought it for,” he said. “I can’t see it being rebuilt as condos, because it’s a heritage building, but what could be a good use for it is if someone made a cultural centre out of it — say for Indigenous art for the region, or a place where amateur artists could sell their art, or more art education instead of exhibits. Those are possibilities if it’s kept as a heritage building, but they haven’t been examined.”

jmoodie@postmedia.com