Hunter v. Vermeer, 2010 HRTO 669

HUMAN RIGHTS TRIBUNAL OF ONTARIO

B E T W E E N:

Cyndy Hunter

Applicant

-and-

Hubertus Vermeer

Respondent

DECISION

Adjudicator: Alan Whyte

Date: March 26, 2010

Citation: 2010 HRTO 669

Indexed as: Hunter v. Vermeer

APPEARANCES

Cyndy Hunter, applicant ) On her own behalf

Hubertus Vermeer, respondent ) Jennifer Quick, counsel

1This is an Application under section 34 of Part IV of the Human Rights Code, R.S.O. 1990, c. H.19 as amended (the “Code”), which alleges discrimination in employment on the grounds of race and citizenship. At the end of the hearing, the applicant requested that the Application be amended to include the social area of contract, as well as employment. That request will be dealt with later in this Decision.

2In summary, the applicant alleges that the respondent, who is of Dutch origin but who is a permanent resident of Canada, treated her differently because she is Canadian. She claims that she has suffered damages as a result of the respondent’s discriminatory conduct.

3Over the two days of hearing, I heard evidence from the applicant, her husband Dan Hunter and the respondent.

THE FACTS

4The applicant is married to Dan Hunter and they have two children ages 17 and 14. Both Mr. and Mrs. Hunter had, up to the fall of 2008, been dairy farmers. They referred to themselves as "herdsmen" which means that they do all things necessary to look after the herd of dairy cattle. For about 20 years before entering into their business arrangement with the respondent, they worked for other people as employees.

5The respondent is a businessperson who is based in Holland but spends some time in Canada each year. He develops farms and owns 10 to 15 farms in Europe and two in Canada. With respect to the farms in Canada, it is common for them to be managed by Dutch or European immigrants, who then usually end up buying the farms from the respondent.

6The respondent owns a number of companies. The two companies involved in this Application are H. Vermeer Farms Ltd. (“Vermeer Farms”), Farlake Dairy Ltd. (“Farlake Dairy”) and Huub Vermeer Holdings Limited (“Vermeer Holdings”). The respondent is the sole shareholder and director of these companies.

7The dairy farm in question is located in south western Ontario. For most of the period of time material to this Application, there were approximately 100 head of cattle at the farm, most were owned by the respondent with the balance being owned by the applicant and Mr. Hunter.

8The respondent made an investment of about $5 million in acquiring and setting up the farm. Other than some minor tools supplied by the Hunters, the respondent supplied all of the materials and equipment required to operate the dairy farm.

9Once the respondent had established the farm in 2002, he needed someone to run the farm and manage the herd. He placed an ad in the newspaper to which the applicant and Mr. Hunter responded. Although there were some differences in the evidence given by the parties, I find that the Hunters wanted to get into business for themselves, as opposed to being mere employees which had been their work experience to that point. The applicant's evidence was that she wanted a "partnership" with the respondent, and the phrase "joint venture" was also used in the evidence given by the parties.

10The applicant's evidence was that she and Mr. Hunter wanted a situation where they could give their children the experience of growing up on a farm. She said that their intention was that the entire family would participate in the operation of the farm.

11A "subcontracting agreement" (“the agreement”) was prepared by the respondent or one of his professional advisors. The parties to the agreement, which is dated September 4, 2002, were Vermeer Farms and "The partnership between Dan Hunter and Cyndy Hunter". The agreement contained the following provisions:

• Vermeer Farms agreed to devote its time and abilities to the overall supervision of the dairy farm, the fieldwork, maintenance of field equipment and the administrative responsibilities.
• the Hunters agreed to devote their time to the management of the herd, the maintenance of the premises and the milking of up to 100 lactating cows.
• Vermeer Farms agreed to provide all the assets required to carry on the business of dairy farming, including the dairy herd of up to 125 cows, dairy facilities and up to 100 kg of dairy quota.
• the Hunters would receive a payment of $3,333.33 per month and use of the home on the farm which was valued at $416.67 per month.
• in addition, the Hunters could receive a certain percentage of the profit per cow (as indicated on an income statement which would be prepared each year) over certain thresholds.
• The agreement would terminate in the event of either the death or disability of Dan Hunter or Cyndy Hunter.
• all differences under the agreement were to be submitted to arbitration.

12According to both parties, things went reasonably well under this business arrangement for the first two years or so. The respondent would typically spend the winter in Holland and he would come to Canada for a few weeks or months in the summer/fall. During the course of the winter, the parties would communicate via fax or e-mail.

13From time to time, the respondent would provide direction, often in writing, to the applicant and Mr. Hunter regarding the operation of the farm. For example, in September 2003 the respondent prepared a report on the operation of the farm which included financial results, compliments on the management of the farm by the applicant and Mr. Hunter, and a list of "The things that didn't work out". In one section of the report headed "What to do about to keep [sic] the farm nice and clean", the respondent made detailed recommendations about operational matters such as washing equipment, putting things where they belong, spraying the weeds on the gravel, etc.

14In May 2004, the respondent produced an "inspection report" which made detailed observations about six areas of the farm and contained directions as to how to improve the appearance of those areas.

15On August 30, 2004, the respondent (on behalf of Vermeer Farms) sent a note to the applicant and Mr. Hunter dealing with a number of items including direction as to the size of the herd.

16On September 7, 2004, the respondent wrote a letter (on Vermeer Farms letterhead) containing some criticisms of the management of the herd by the applicant and Mr. Hunter, and also containing detailed recommendations about how the herd should be managed (even broken down to what tasks should be completed at what point during the day).

17On October 18, 2004, the respondent prepared (on Vermeer Farms letterhead) a document titled “Maniging [sic] program” which contained detailed directions as to how to maintain certain parts of the farm and the herd.

18On March 8, 2005, the respondent (on Farlake Dairy letterhead) wrote a letter which contained an agenda for a meeting with the applicant and Mr. Hunter on March 16, 2005. It related to both general issues such as the goals of the parties as well as detailed issues regarding the financial performance of the herd.

19On March 18, 2005, the respondent (on Farlake Dairy letterhead) sent out a plan for the 2005 year. This document was generated as a result of the March 16, 2005 meeting.

20On March 19, 2005, Vermeer Farms and the applicant and Mr. Hunter entered into an "Assignment of subcontractor agreement" under which Vermeer Farms Ltd. assigned to Farlake Dairy all rights that it held in the agreement dated September 4, 2002.

21Between mid-2005 and May 2007, fewer documents were sent by the respondent to the applicant and Mr. Hunter, however the evidence given by the parties at the hearing was that the respondent continued to issue directions and recommendations about the management and operation of the farm. The context of these communications was that the farm was not performing financially up to the respondent's expectations, and the applicant and Mr. Hunter were not receiving any bonus under the agreement as they hoped to do.

THE ALLEGATIONS OF DISCRIMINATION

22During the years that she did business with the respondent, the applicant alleged that on a relatively infrequent basis (estimated to be three or four times per year), he would make comments to her and and/or Mr. Hunter which were based on their citizenship. The typical comment would compare how things were done in Holland or how Dutch farmers operated on one hand, to how things were being done in Canada or how Canadian farmers operated, on the other. For example, the applicant alleged that the respondent would describe Canadians as "slackers" and "lazy" and would often criticize the way things were done on Canadian farms compared to how they were done on Dutch farms.

23It should be noted that it was agreed between the parties at the commencement of the hearing that there is a difference in the style of management of dairy operations between Holland and Canada.

24The respondent did not disagree that from time to time he would compare how things are done in Holland to how they are done in Canada, and that this comparison would usually occur in the context of a discussion with the applicant and Mr. Hunter about how they could improve the management of the respondent's dairy farm. However, he denied that he intended to discriminate against the applicant and Mr. Hunter and that he was simply using the above-mentioned comparison as a tool to describe how the applicant and Mr. Hunter could do a better job for both the respondent’s benefit and their own benefit.

25In the summer of 2007, the Hunter's daughter wrote a letter to the respondent asking about why there were problems between her parents and the respondent about the operation of the farm, and explaining the impact of those problems on the Hunter family. The applicant and Mr. Hunter had also forwarded correspondence to the respondent regarding their issues and concerns at that time. The respondent responded by letter dated August 10, 2007 (on Farlake Dairy letterhead) which reflected back on the last five years as well as on more recent problems that had arisen. The letter included the following phrases:

• We are from a different culture. I am Dutch you are Canadian, that means we have a different way of thinking, working, planning organize [sic] etc.
• If you ask yourself the question: why are the Dutch farmers so successful in Canada, why do they do it different etc. The main answer is that we are raised in a different way, the way that we are raised is:
  1. Always try to do things better, never be satisfied with things unless it is perfect
  2. this job has to be done today no matter what
  3. there are the things I am going to do today
  4. the money I make will be saved to expand.
• So why are the Dutch framers [sic] so successful and why do they have money to expand after a couple of years. I think this is the difference in culture and in [sic] the same time also the difference in managing.

26The applicant responded to this letter by letter dated August 21, 2007 (which was not entered as an exhibit) to which the respondent replied in a terse letter dated August 23, 2007. The applicant testified that she was furious and dismayed by the contents of the August 10 letter. She interpreted the letter to mean that she should be Dutch instead of Canadian, and that the respondent was asking her and her husband to change both their style and being. She said that the letter increased her stress level significantly and that there was tension between she and her husband as a result. She also said that she and her husband were very frustrated and discouraged by this time by the constant criticism that they were receiving from the respondent regarding their management of the farm.

27The next allegation of discrimination arose out of a meeting at the farm between the applicant, Mr. Hunter and the respondent which, according to Mr. Hunter, occurred at the end of September 2007. Both the applicant’s evidence and Mr. Hunter's evidence was that, in the course of discussion, the applicant accused the respondent of having discriminated against them in his letter of August 10. The respondent hung his head and said "I know". The respondent testified that he did not recall this incident.

28The applicant testified that by the fall of 2007, things were very difficult for her and her husband. There were money issues related to the operation of the farm and she and her husband were having great difficulty dealing with the constant criticism which they experienced from the respondent. They also felt that they had been the subject of discrimination and were tired of hearing from the respondent that they should be Dutch (at least this is how they interpreted his statements) and should be doing things the Dutch way. They also interpreted these statements by the respondent to mean that they were doing things the "wrong" way. They were also seeking from the respondent in this timeframe increased compensation under the agreement.

29As a result, the applicant and Mr. Hunter consulted a lawyer with respect to their rights. The advice that they received was that they should proceed to terminate the agreement by giving the respondent six months notice of termination as required under the agreement. The lawyer drafted on their behalf a notice of termination which was delivered to the respondent on or before October 31, 2007. The notice contains some of the reasons for the giving of the termination but discrimination is not mentioned.

30The applicant said that the respondent’s August 10 letter was provided to the lawyer and that his advice was that it should not be used against the respondent at that stage, but rather, could be kept in their "back pocket" and used later depending on how things went in their dealings with the respondent. She said that the lawyer that she consulted was not familiar with the area of human rights law.

31The respondent provided an increase in the Hunter’s base compensation under the agreement in October 2007 to $5000 per month. This arose out of negotiations between the parties which involved the respondent’s accountant.

32The Hunters operated the farm during the winter of 2007-2008. In April, the Hunters perceived that the respondent was attempting to move in a new farm manager prematurely, accordingly, they gave the respondent notice that they were taking "vacation" from April 16 to April 30, 2008, which was the termination date of the agreement. The respondent was forced to take over the dairy operation on very short notice in order to keep the farm going.

33Under the agreement, the respondent paid, through either Vermeer Farms or Farlake Dairy, a monthly amount according to the terms of the agreement. There were no statutory deductions taken out of that payment. Consequently, when it came time for the Hunters to pay income tax in April, they would often have to take a loan from the respondent or one of his companies in order to pay that liability. The loan would be repaid to the respondent or his company in due course.

34In 2007, the Hunters borrowed from Vermeer Holdings the sum of $5500 in order to pay their tax. When it came time to finalize the financial arrangements between the Hunters and the respondent (on behalf of Farlake Dairy) in April 2008, the respondent provided a statement to them which credited them $5000 for the payment due to them for the month of April under the agreement, and then deducted the sum of $5500 as repayment of the Vermeer Holdings loan, leaving a balance due of $500.

35On September 9, 2008, counsel for Farlake Dairy wrote to the applicant and Mr. Hunter, advising them that they were in breach of the agreement and had been negligent in their management of the dairy operation, and claimed $20,000 to compensate Farlake Dairy for damages and breach of contract. In the absence of payment of that sum within 30 days, the letter advised that an action would be started for substantial damages.

36There then ensued an exchange of correspondence between the lawyers for the Hunters and Farlake Dairy, which extended into December, 2008. In September 2008, the Hunters started a Small Claims Court action against Farlake Dairy for the $5000 which they alleged they were owed under the agreement for the month of April, 2008. The Hunters also commenced an Employment Standards Act, 2000, S.O. 2000, c. 41, as amended, claim against Farlake Dairy and the respondent in or about October, 2008.

37This Application was filed with the Tribunal on September 29, 2008.

ANALYSIS AND DECISION

38The above facts give rise to the following issues:

a) was the Application filed beyond the one year limitation period contained in section 34(1) of the Code? If so, was the delay in incurred in good faith by the applicant and was there substantial prejudice to the respondent, within the meaning of section 34(2) of the Code?

b) should the applicant be permitted to amend her Application so as to rely on section 3 of the Code (contracts)?

c) was the applicant an employee or contractor of Farlake Dairy?

d) is the respondent liable for a breach of the Code?

e) if so, what remedies is the applicant entitled to?

DELAY

39Section 34 of the Code states as follows:

(1) If a person believes that any of his or her rights under Part I have been infringed, the person may apply to the Tribunal for an order under section 45.2,

(a) within one year after the incident to which the Application relates; or

(b) if there was a series of incidents, within one year after the last incident in the series.

(2) A person may apply under subsection (1) after the expiry of the time limit under that subsection if the Tribunal is satisfied that the delay was incurred in good faith and no substantial prejudice will result to any person affected by the delay.

40The Tribunal's case law has established that the Tribunal has no jurisdiction to entertain an application which is filed beyond the one year limitation period set out in section 34(1) unless it is satisfied it is appropriate to exercise its discretion because the provisions of s. 34(2) are met. The Tribunal’s usual approach, which I adopt, is to first determine whether good faith has been established by the applicant, and only if that it so, to proceed with a determination as to whether substantial prejudice exists.

41The respondent seeks a dismissal of the Application based on the argument that the last incident of discrimination, which he denies, occurred on August 10, 2007, the date of his letter to the Hunters. As the Application was not filed until September 29, 2008, the one year limitation period was exceeded. The respondent also argues that the Tribunal should not exercise its discretion to permit the late filing of the Application on the basis that the applicant operated in bad faith, not good faith, in keeping the August 10, 2007 letter in her "back pocket" for solely strategic purposes.

42The applicant takes the position that the last incident of discrimination was the letter of September 9, 2008 from counsel for Farlake Dairy, which is argued to be a continuation of the respondent's discrimination against the Hunters.

43I am satisfied that the last incident of discrimination was the letter from the respondent dated August 10, 2007, and therefore the Application was filed beyond the one year limitation period. The applicant immediately perceived that the contents of that letter were discriminatory. She took action as a result in the form of confronting the respondent in September 2007 which produced an alleged acknowledgment of discrimination from the respondent. However, I find that the alleged acknowledgment does not constitute in and of itself an incident of discrimination and therefore it does not have the effect of extending the limitation period.

44In September 2008, the applicant received the letter dated September 9, 2008 from counsel for the respondent. I find that this letter was not discriminatory and does not have the effect of extending the limitation period under the Code. It was apparently this letter that provoked the filing of this Application, as presumably it was clear in the applicant's mind after receipt of that letter that it was not going to be possible, or at least easy, to resolve the outstanding issues between the Hunters and the respondent. It was at this point in time that the applicant chose to pull the August 10, 2007 letter "out of her back pocket" for use in a legal proceeding i.e. this Application.

45In determining whether or not the applicant operated in good faith in this case, I take into account a number of factors. In Lafleur v. Kimberley Scott, 2009 HRTO 1141 at paragraph 8, the Tribunal said as follows:

In another context, the Ontario courts have had occasion to interpret the phrase “delay that has been incurred in good faith”. To establish that delay in pursuing one’s rights has been incurred in good faith, it must be shown that the applicant acted honestly and with no ulterior motive. (Hart v. Hart (1990), 1990 CanLII 12268 (ON HCJ), 27 R.F.L. (3D) 419 (Ont. U.F.C.), cited in Scherer v Scherer 2002 CanLII 44920 (ON C.A.), (2002) 59 OR (3d) 393 (O.C.A.). Delay has been found not to have been incurred in good faith where it was due to wilful blindness to the need to make inquiries about one’s rights: Webster v Webster Estate, 2006 CanLII 22941 (ON SC), [2006] OJ No. 2749 (ON S.C.). The courts have held that “failure to act in ignorance of one’s rights may, in some circumstances, amount to “good faith”. However, it is not enough for a party who must establish good faith to say that he or she was ignorant of their rights. They must also establish that they had no reason to make enquiries about those rights.” (Busch v Amos, 1994 CanLII 7454 (ON CTGD), [1994] OJ No. 2975 (Ct. J. (Gen. Div.), cited in Scherer, supra).

46In this case the applicant obtained legal advice early on in the dispute. The lawyer assisted her with respect to the termination of her relationship with Farlake Dairy, but the lawyer that she consulted did not have expertise in human rights law. Knowing that, she apparently accepted his advice that the August 10, 2007 letter should not be used at that point in time, but rather should be put in her "back pocket" for use at a later date if required. The applicant cannot claim she was ignorant of her rights under the Code.

47In the summer of 2008, she consulted with the Ontario Human Rights Commission (“the Commission”), although there was no evidence given about the detail of her questions put to the Commission or of the responses given. What is material is that she had the opportunity at that stage to make inquiries of the Commission about the timeframe within which she was required to file an Application.

48The applicant also gave evidence that she read the Applicant's Guide published by the Tribunal, which contains a reference to the one year limitation period, although the point in time at which she reviewed the Guide was not clear on the evidence.

49There is nothing wrong with adopting a legal strategy which involves a party not relying on a particular piece of evidence until sometime in the future. However, the adoption of such a strategy does not excuse that same party from complying with the applicable law relating to the commencement of legal proceedings. The policy underlying limitation periods is that the respondent, or potential respondent, is put on notice of a legal claim so that party may secure advice and take steps to preserve evidence.

50As set out above, the Tribunal has found that ignorance of one's rights does not, except in the most exceptional of cases, constitute good faith for the purposes of section 34(2) of the Code. In this case, the applicant knew right from the point in time that she received the August 10, 2007 letter that she considered the respondent’s actions and attitude discriminatory and, in her view, the letter confirmed this belief. She secured legal advice with respect to that issue and decided to not pursue the discrimination issue at that point in time. She was prepared to “sit on her rights." The applicant must bear the risk of engaging in that strategy and if she failed to make reasonable inquires about that strategy and any attendant risks or time limits, she cannot say that her delay was in good faith. (Busch v. Amos, supra).

51I note as well that at the time of the last incident of discrimination (August 10, 2007), and in the fall of 2007 when the applicant secured legal advice, the applicable limitation period in the Code was six months, not one year. This simply emphasizes the extent to which the applicant's delay in initiating this Application was in excess of the statutory limitation period.

52Based on all of the above, I find that the delay in filing this Application was not incurred in good faith within the meaning of section 34(2) of the Code.

ORDER

53In light of the above finding, it is not necessary to address the remaining issues. The Application is dismissed.