N.W.T. judge directs partial release of frozen funds to former CEO of Denesoline

An N.W.T. Supreme Court judge has ordered the release of $120,000 in frozen funds to the former CEO of Łutsel K'e Dene First Nation's business arm, Ron Barlas.

In a written decision Monday, Justice Nicholas Devlin said he reached a "split conclusion," approving funds for legal defence but denying additional living expenses.

In 2023, a court injunction froze all of Barlas's assets following allegations that he funnelled millions of dollars away from Denesoline Corporation.

Last July, the Supreme Court found Barlas had used company resources for personal gain and ordered a trial to determine damages owed to Łutsel K'e Dene First Nation (LKDFN).

Last month, Barlas requested approximately $1 million from the frozen funds to cover legal fees and living expenses, arguing that he and his wife, Zeba Barlas, were unemployable and without financial support.

In his decision, Justice Nicholas Devlin rejected the request for living expenses, citing inconsistencies in Ron Barlas's financial disclosures. 

"The amounts sought and previously released for his living expenses have strained the concept of reasonableness in a number of regards," Devlin wrote. 

The judge also said Barlas had not been fully forthcoming about his assets, needs and spending. 

"The Barlas' have already received more than most families would consider reasonable to sustain a modest standard of living," Devlin added.

Earlier, LKDFN lawyers had told the court that Barlas has already used $1.4 million of the total approximate value of the frozen assets, which was around $5 million at the time, for some of his legal fees.

Devlin dismissed Barlas's request for funds to cover outstanding legal fees. However, the judge approved $120,000 to cover future legal costs related to Barlas's appeal of the earlier decision by Justice Karan Shaner.

In a preliminary assessment, Devlin described the appeal as "weak but not frivolous" and emphasized the importance of proper representation, stating, "self-representation is not a viable or just option."

"It is unlikely that Barlas, regardless of his commercial acumen, could adequately present this case, to say nothing of his wife, who has an equal amount at stake," Devlin wrote.

The court also approved an additional $15,000 to cover Barlas's legal fees for last month's hearing. 

Devlin said that the remaining frozen assets largely belong to LKDFN and should not be used to fund the defendant's costs, unless exceptional circumstances warranted it.