Mead v. Loop Enterprise Inc., 2011 HRTO 173

HUMAN RIGHTS TRIBUNAL OF ONTARIO

B E T W E E N:

Dale Mead

Applicant

-and-

Loop Enterprise Inc. and Carmine De Santo

Respondents

INTERIM DECISION

Adjudicator: Douglas Sanderson

Date: January 25, 2011

Citation: 2011 HRTO 173

Indexed as: Mead v. Loop Enterprise

WRITTEN SUBMISSIONS BY

Dale Meade, Applicant ) Matthew A. Fisher, Counsel )

Mutual Synergy Group Inc., ) Cindy Cohen, Counsel

Proposed Respondent )

1This is an Application filed December 8, 2009, under section 34 of Part IV of the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”), alleging discrimination on the basis of disability and sex, including sexual harassment, in employment. The respondents filed Responses to the Application and the applicant subsequently filed a Reply and a Request for Order seeking to add Mutual Synergy Group Inc. (“Synergy”) as a respondent in these proceedings (“Request”). Synergy filed a Response to a Request for Order (“Response to Request”). The organizational respondent, Loop Enterprise Inc., did not file a Response to Request.

2As noted in a previous Interim Decision in this matter, 2010 HRTO 1461, the Tribunal received correspondence from a Trustee in Bankruptcy on behalf of the individual respondent, advising that this respondent filed a Notice of Intention to make a Proposal under the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3 (the “BIA”). The Tribunal concluded, consistent with Tribunal jurisprudence, that the Application against the individual respondent is stayed by operation of section 69(1) of the BIA. The Application could proceed against the corporate respondent since there was no stay of proceeding regarding this respondent, and indeed the matter has been scheduled for hearing in May 2011.

3In the Request, the applicant asserts:

The Respondent corporation has transferred the assets and the business of the corporation to a related company in order to attempt to avoid its liabilities.

The applicant presented an e-mail message purporting to be from the individual respondent to employees of the corporate respondent, Loop, to the effect that Loop has become part of a company called My Blue Umbrella.

4In its Response to Request, Synergy denies being a related company to the corporate respondent and asserts that its parent company, My Blue Umbrella, merely purchased the corporate respondent’s customer list. Synergy acknowledges that it does employ the personal respondent and other former employees of the corporate respondent, but states that it went to some lengths to ensure that their employment with the corporate respondent did not continue with Synergy.

5In effect, the applicant requests that the Tribunal “pierce the corporate veil” in a manner contemplated under sections 1(4) and 69 of the Labour Relations Act, 1995, S.O. 1995, c. 1, Schedule A, and section 9 of the Employment Standards Act, 2000, S.O. 2000, c. 41. The Ontario Divisional Court dealt with this issue in connection with a complaint before the Board of Inquiry (the Tribunal’s predecessor) (the “Board”) in Great Atlantic & Pacific co. of Canada v. Ontario (Human Rights Commission), (1993) 1993 CanLII 8616 (ON CTGD), 13 O.R. (3d) 824. The Board added A&P as a respondent to a complaint because it purchased assets from the original corporate respondent. The Court noted the Code, as it was at the time, contained no successor rights provision similar to those found in the Labour Relations Act or the Employment Standards Act. Consequently, the Board had no jurisdiction to add A&P as a party and the Court quashed the decision.

6The Code has changed considerably since the A&P decision, but successor or related employer provisions have never been added to it. Accordingly, the principles in the A&P decision still apply. The Tribunal has no jurisdiction to add a party to an application on the basis alone that it may be a successor or related employer as defined under other statutory provisions such as the Labour Relations Act or the Employment Standards Act.

7The Tribunal can add parties to an application in appropriate circumstances, however. In Smyth v. Toronto Police Services Board, 2009 HRTO 1513, the Tribunal held that it should consider the following three questions when determining a request to add a respondent:

(1) Are there allegations made that could support a finding that the proposed respondent violated the Code?

(2) If the proposed respondent is an individual and an organization is also named, is there a compelling reason to include him or her as a respondent?

(3) Would it be fair, in all the circumstances, to add the proposed respondent?

The application of the first stage involves considering whether there are allegations made in the Application that could lead to a finding that the proposed respondent violated the Code. The second stage clearly does not apply in this case. At the third stage, the Tribunal may consider a variety of factors, including the effects on the hearing process of adding the proposed respondent, the reasons the proposed respondent was not named in the application or response, and prejudice to the other parties.

8In the present case, the applicant makes no reference whatsoever to the proposed corporate respondent in the Application. Further, in her Request, the applicant asserts that the proposed corporate respondent was created after she filed this Application. Consequently, there are no allegations made that could support a finding that the proposed respondent violated the Code. In these circumstances, I need not consider the other factors cited in Smyth, above.

9The Request is denied.