Havens v. Dollarama L.P, 2012 HRTO 793

HUMAN RIGHTS TRIBUNAL OF ONTARIO

B E T W E E N:

Michelle Havens

Applicant

-and-

Dollarama L.P.

Respondent

DECISION

Adjudicator: Alan G. Smith

Date: April 19, 2012

Citation: 2012 HRTO 793

Indexed as: Havens v. Dollarama L.P

APPEARANCES

Michelle Havens, Applicant ) Self-represented

Dollarama L.P. Respondent ) Kathleen Chevalier, Counsel

BACKGROUND

1This is an Application filed on June 1, 2011, under section 34 of Part IV of the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”). The applicant alleges she was forced to quit her employment with the respondent on March 14, 2011, due to on-going discrimination based on disability, creed, sex and sexual orientation.

2The respondent filed a Response on July 13, 2011, which included a Request to Dismiss the Application. The respondent argues that the applicant signed a full and final release with respect to the same issues in dispute and therefore it would be an abuse of process for the Tribunal to continue to process the Application.

3The applicant filed submissions on August 12, 2011, opposing the Request to Dismiss. In response to a Case Assessment Direction issued by the Tribunal on August 30, 2011 the applicant also indicated that she wished to make oral submissions in response to the Request to Dismiss.

4A teleconference hearing was held before me on March 26, 2012. Both parties participated and made oral submissions with regard to the request for early dismissal.

5At the beginning of the hearing both parties agreed that I could consider all written submissions (including the Application, Response and Reply) in my decision. Both parties understood and agreed that the hearing would be confined to hearing submissions with regard to the respondent’s Request to Dismiss on the basis of the signed release document and would not consider or deal with the merits of the Application.

FACTS

6The material facts are not in dispute. The applicant was employed by the respondent from October 15, 2005 to March 14, 2011, when the applicant resigned her employment.

7On March 18, 2011, the Ministry of Labour notified the respondent that $689.00 in termination pay was owing to the applicant. .

8On March 25, 2011, the respondent offered the applicant a severance package, which included payment of a lump sum of $2,388.15 inclusive of her termination pay. The offer was conditional on the applicant executing a full and final release. The release barred any subsequent claims against the respondent including, “any claims under applicable employment standards or human rights legislation”.

9On March 30, 2011, the applicant telephoned the respondent’s representative to clarify the language in the release. The representative confirmed that the intention of the release was to prevent the applicant from filing a human rights complaint in the future. During the conversation the representative recommended to the applicant that she obtain legal advice before agreeing to the release.

10The applicant signed the release on March 30, 2011, without consulting counsel. She was provided with the agreed upon lump sum.

ANALYSIS

11In her written submissions the applicant states “I did sign a release I was distraught from having to quit my job because it was my only source of income.…” In oral submissions she confirmed she was “angry, upset and distraught” and felt under duress when she signed the release. Therefore, she argues, she should not be bound by it.

12The applicant also objected to the fact that the respondent had indicated on her Employment Insurance Record of Employment that she had “resigned”, which she felt was incorrect. The applicant appeared to argue that this showed some sort of bad faith on the part of the respondent and therefore the release should be disregarded. However, she admitted that she obtained Employment Insurance benefits without having to resort to an appeal to the Employment Insurance Board of Referees. In other words, regardless of what the Record of Employment indicated, the applicant suffered no financial prejudice from it. I therefore find that the Record of Employment issue is irrelevant to the question as to whether the Application should be allowed to continue. Accordingly, I find it unnecessary to address that portion of the applicant’s argument, and will deal only with the issue of duress.

13The terms of the Release clearly encompass an application made under the Code. However, accepting that the release expressly encompassed legal action related to human rights does not end the inquiry. In Bielman v. Casino Niagara, 2009 HRTO 123, the Tribunal stated:

The Code does not explicitly bar applications such as this where a release has been signed by the applicant. In each case where a respondent requests early dismissal of an application, the Tribunal must decide whether, in the circumstances, it would constitute an abuse of the Tribunal’s process to allow the application to proceed to a hearing on the merits. An important consideration in that analysis is the respondent’s reasonable expectation that a release of this kind will bring finality to any employment related dispute they may have with a former employee.

14Thus, while the existence of a full and final release is not a statutory bar to continuing an application, there are many reasons to uphold agreements reached between freely contracting parties. Failure to uphold such agreements, and to hold parties to their commitments, can undermine the integrity of negotiated settlements and hinder the timely and informal resolution of disputes. See Martinez v. Siemans Canada, 2010 HRTO 1027.

15The Tribunal has also held that filing a human rights application after signing a full and final release in respect of the subject-matter of the application may constitute an abuse of the Tribunal’s process and, where that is the case, such applications should be dismissed. See Dube v. Rockhaven Recovery, 2009 HRTO 53; Sinnett v. Orlick Industries, 2009 HRTO 916; Kailani v. Securitas Canada, 2009 HRTO 1183; Martel v. North Shore Community Support Services, 2010 HRTO 957. Section 23(1) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, as amended, provides that a tribunal may make such orders or give such directions in proceedings before it as it considers proper to prevent abuse of its processes

16As noted by the Tribunal in Martel, above:

It is not uncommon for parties before the Tribunal to argue that they entered into written settlements because of financial hardship, and that such agreements ought to be set aside on the basis that they were entered into under “economic duress”. However, entering into an agreement because it will help to alleviate financial difficulties, even where those difficulties are significant, does not necessarily mean that the agreement has been entered into under duress.

17Where “duress” is put forward as the basis for vitiating a settlement agreement, the party claiming distress is really stating that he or she entered the agreement against his or her own free will. See Martel above.

18Black’s Law Dictionary, 8th ed. (St. Paul, MN: Thomson West, 1999), gives the following as one of the definitions of “duress”:

Broadly, a threat of harm made to compel a person to do something against his or her will or judgment, especially a wrongful threat made by one person to compel a manifestation of seeming assent by another person to a transaction without real volition.

19“Economic duress” is also specifically defined in Black’s, not in terms of a party’s financial circumstances per se, but the threat of financial harm:

… an unlawful coercion to perform by threatening financial injury at a time when one cannot exercise free will.

20The Ontario Court of Appeal described the elements of economic duress in , Taber v. Paris Boutique & Bridal Inc. (Paris Boutique), 2010 ONCA 157 at pars. 8-9:

There is no doubt that economic duress can serve to make an agreement unenforceable against a party who was compelled by the duress to enter into it. Nor is there any doubt that the party can have the agreement declared void on this basis.

However, not all pressure, economic or otherwise, can constitute duress sufficient to carry these legal consequences. It must have two elements: it must be pressure that the law regards as illegitimate; and it must be applied to such a degree as to amount to “a coercion of the will” of the party relying on the concept. See: Stott v. Merit Investment Corp., 1988 CanLII 192 (ON CA), 63 O.R. (2nd) 545 (Ont. C.A.), at para. 89.

21In Stott, the court held that in order for economic duress to be found, the party whom is being illegitimately pressured must be put in position where he has no “realistic alternative” but to submit.

22In this case, I am not satisfied that the circumstances outlined by the applicant amount to the type of economic duress that would render the Release unenforceable. The applicant believes that she was experiencing discrimination under the Code and had no choice but to resign her employment. However, she could have chosen to not sign the release, only receive the amount which had been ordered by the Ministry of Labour under the ESA, and then pursue her claim in the Tribunal or the Courts. The offer was made to her on March 25, 2011. She accepted the offer on March 30, 2011. Therefore she had five days to consider her options. After choosing not to consult with a lawyer, she elected to sign the release and thereby accept the enhanced payment.

23I cannot conclude that the applicant did not truly consent to the terms of the release, which is what a finding of duress would entail. There are no facts alleged here which could lead me to conclude that the applicant had no “realistic alternative” but to agree to those terms. Although I do not doubt that the applicant was under financial pressure at the time she signed the release, I am not persuaded that the applicant had no free choice such that it was signed under “economic duress”, see Martel, above.

24Having regard to the terms of the release, I find it would be an abuse of the Tribunal’s process to permit the Application to proceed.

ORDER

25The Application is dismissed.