Court releases some frozen funds to pay for Barlas appeal

The NWT Supreme Court has ordered the release of $120,000 in frozen funds to help pay for Ron Barlas’ appeal.

The assets of Barlas and his wife have been frozen since April 2023, when a lawsuit alleged he had misappropriated millions of dollars from the Łútsël K’é Dene First Nation. Of those assets, which were valued around $5.5 million, approximately $1.4 million was released to the couple to pay for legal and living expenses.

Barlas lost the case in July 2024, with NWT Supreme Court Justice Karan Shaner ruling he had breached his fiduciary duty as the head of the First Nation’s business arm in “an extreme and egregious manner.”

Barlas is now appealing that ruling.

At a hearing in December 2024, lawyers for Barlas requested that a further $1.1 million be released from the frozen assets.

The lawyers sought $153,672 to help Barlas and his wife pay for living expenses from September 2024 to September 2025, $675,000 to cover unpaid legal fees, and $310,000 for future legal fees to pursue the appeal.

The Łútsël K’é Dene First Nation opposed the request, arguing that the remaining frozen assets rightly belong to the First Nation’s companies.

In a written decision on Monday, Justice Nicholas Devlin said he had reached “a split conclusion” in the case.

Living expenses not reasonable, judge finds

Devlin dismissed the request to release further funds for living expenses, finding that the Barlases had “already received more than most families would consider reasonable to sustain a modest standard of living.”

“Mr Barlas has not been forthcoming about the entire picture of his asset availability, needs and spending,” the judge continued.

“He has not satisfied his burden to show an absence of funds for reasonable living expenses. He has gotten money from elsewhere and failed to disclose its source. He has asked for and received money for items that are not basic living expenses and has been inaccurate about relevant financial details.”

Devlin also dismissed the Barlases’ request that frozen funds be released to pay for their outstanding legal costs.

The judge said while that may seem “harsh” to the law firm that is owed hundreds of thousands of dollars, releasing more frozen funds to pay them would be akin to “burning the plaintiff’s money to selectively pay one of the defendants’ unsecured creditors.”

“Put simply, it would be the epitome of inequity to pay for a wrongdoer’s unsuccessful attempt to justify his breaches of fiduciary duty with the plaintiff’s non-recuperable money,” he wrote.

Appeal too technical for self-representation

Devlin ruled in favour of Barlas regarding the release of some frozen funds to pay for future legal costs related to his appeal.

The judge said while the Barlas couple “appear to have an uphill battle with a low chance of success,” their appeal is “weak but not frivolous.”

Devlin said the appeal would provide “a high degree of finality and strong assurance of a just outcome for relatively little money compared to the application itself.”

He added the appeal is technical in nature and it is unlikely that Barlas or his wife could adequately represent themselves in court.

The judge concluded that balancing relevant factors warranted funding the appeal.

He ordered that a total of $120,000 be released from the frozen assets to help pay for the appeal, as well as $15,000 to pay Barlas’ lawyers for December’s hearing regarding the release of funding.