The Acho Dene Koe band suspended Chief Harry Deneron until further notice, citing a "lack of confidence" in his leadership amid an ongoing lawsuit involving Deneron and the band's development corporation.
The Fort Liard, N.W.T., band council voted to suspend Deneron at a meeting March 9, says Sonia Timbre, a band councillor and spokeswoman for the council.
"The band lost confidence in Harry as a chief," Timbre said. "We were elected to represent the majority of the band members and not just a select few."
A majority of councillors can vote to suspend a chief under the band's governance structure, Timbre says.
"The council members are acting as a whole. We're trying to do what's best for the community. There are a lot of things being discussed, agenda items, what we're looking into," Timbre said.
Lawsuit over alleged financial misconduct
Deneron is being sued by ADK Holdings over allegations he tried to steer government contracts away from the band's construction firm and toward a company he has a financial stake in.
Those contracts, for airport and highway maintenance in Fort Liard will be put out to tender shortly, according to a GNWT spokeswoman.
The lawsuit alleges Deneron's personal recommendation to the government is behind that decision and one of the companies bidding for that work owes Deneron a financial obligation.
Deneron had yet to file a statement of defence in that case as of Friday afternoon, and the allegations have not been tested in court.
Suspension affects Deneron's other roles
This suspension complicates Deneron's position as a negotiator for the Acho Dene Koe First Nation and the band is still determining how that position will be affected, Timbre explained.
"There's so many things we need to look at as a council and how it will affect the negotiations and that's another thing that we're looking into," she said.
A public meeting to discuss this issue is scheduled for later this week.
Deneron did not return a call from CBC News requesting comment on this story by Tuesday evening.