HUMAN RIGHTS TRIBUNAL OF ONTARIO
B E T W E E N:
Brian Leve
Applicant
-and-
Grant Thornton LLP
Respondent
INTERIM DECISION
Adjudicator: Paul Aterman
Indexed as: Leve v. Grant Thornton LLP
WRITTEN SUBMISSIONS
Brian Leve, Applicant
Daniel Lublin, Counsel
Grant Thornton LLP, Respondent
Allyson Fischer, Counsel
1This Interim Decision explains why the Tribunal will not defer consideration of this Application, which alleges discrimination with respect to employment because of age contrary to the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”).
2The respondent is a partnership that provides accounting, business advisory and risk management services. The applicant worked at the respondent firm from April 2005 until his retirement on the last day of December, 2013. Initially the applicant’s title was “Associate Partner”. Then, in January of 2006, he became an “Income Partner” and retained that status until his retirement.
3The terms of the applicant’s status as an Income Partner included a provision obliging a partner to retire on the first day after the fiscal year in which a partner turns 63. The applicant maintains that this provision is discriminatory, and that he can bring this Application to remedy the alleged discrimination because, in substance, he was an employee and not a partner.
4The applicant maintains that he was not entitled to an equity interest in the partnership, that his compensation did not depend on the overall performance of the respondent, that he had no voting rights that would enable him to participate in determining the conditions of his employment and that he had no say in who was admitted to or removed from the partnership. This indicates, claims the applicant, that he was an employee. As an alternative argument he asserts discrimination in contract, but the thrust of his Application is that he was in an employment relationship with the respondent.
5The respondent has not yet provided a Response. Instead it requests deferral of this Application because the parties are involved in a lawsuit in the Superior Court of Justice. The respondent is suing the applicant because it alleges that, both before and after the applicant retired, he took steps that damaged the respondent’s business by soliciting clients of the respondent and establishing a business in competition with the respondent. In its Statement of Claim the respondent requests declarations that the applicant breached the terms of his partnership agreement with the respondent, breached his fiduciary duty to the respondent and divulged the respondent’s confidential information.
6The applicant has filed a defence that maintains he was not bound by any fiduciary obligation to the respondent, has not competed with the respondent’s business and has not solicited the respondent’s clients. In the alternative he asserts that the respondent suffered no damage. The applicant has counterclaimed for an amount that he says he earned prior to his retirement but that was not paid to him.
7The decision to defer consideration of an Application is a discretionary one. The principal purpose of deferral is to avoid the risk of conflicting determinations by the Tribunal and other adjudicative bodies on overlapping facts and issues.
8The basis of the respondent’s deferral request is that there is an overlap of issues in this Application and the civil action. The respondent argues – correctly - that a threshold question in this Application is whether the applicant was an employee or a partner in the respondent. It maintains that the court has to determine this issue as well. The respondent argues:
In its action, Grant Thornton takes the position that, as an Income Partner, the Applicant was a true partner at law, thus resulting in fiduciary duties which would not otherwise be imposed on an employee (see paras 14 to 30 of the Amended Statement of Claim).
9Further, the respondent argues that its Statement of Claim asserts that the applicant played a key role in one of the respondent’s business groups, contrary to the applicant’s assertion that he had no managerial responsibility. The fact that this issue will have to be determined in both the civil action and this Application suggests further potential for conflicting determinations on the same facts.
10Another issue in dispute is which partnership agreement applies, because the 2006 Income Partnership Agreement was amended in 2012. In addition, there is dispute as to whether the applicant validly executed the firm’s Partnership Agreement and its Consulting Partnership Agreement.
11Finally, the respondent says that there is an overlap of remedies requested in both proceedings.
12The applicant opposes deferral because he says that the two proceedings are about wholly different issues: the Application is about age-based discrimination whereas the lawsuit is about wrongful solicitation and competition. Further, the applicant argues that the nature of the damages claimed in the two proceedings is different, that the Tribunal has authority to award public-interest remedies that are unavailable to the court, and that it would be unfair to him to have to await the outcome of civil litigation as he did not initiate it and it will take years to resolve.
13In arguing for deferral the respondent cites Klein v. Toronto Zionist Council, 2008 HRTO 189, where the Tribunal states at para. 12:
Although the civil action does not raise human rights issues or include a claim for human rights remedies, the underlying events giving rise to both the civil action and the Application to the Tribunal are the same.
14Here the underlying events giving rise to the two proceedings are not the same. The civil action is about whether the applicant engaged in competition with the respondent both before and after his retirement. The Application is about his retirement and whether the partnership term mandating retirement at 63 applied to him.
15The issue of whether the applicant was an employee or a true partner is at the core of the inquiry in this Application. The Tribunal will likely have to look at the elements of the control test articulated by the Supreme Court of Canada in McCormick v. Fasken Martineau DuMoulin LLP, 2014 SCC 39 and determine to what extent they are at play in this case.
16By contrast, it does not appear to me that the court in the civil action needs to exhaustively determine the employee vs. partner question in order to rule on whether the applicant was bound not to compete and whether he in fact competed with the respondent. While it is possible that the court will address that issue, a determination of that question is not a condition precedent to the court deciding the action before it.
17When the Tribunal deals with requests for deferral there are very few instances where there is no possibility at all of overlapping determinations in both proceedings. What matters is not that there be no risk of overlap at all, but rather the extent of the possible overlap. Here there is a possibility of overlapping determinations on the employee vs. partner question. However, this issue is at the core of the Tribunal’s inquiry, whereas it is a relatively minor issue in the civil litigation. This is the main reason for refusing to defer this Application.
18The remedies being requested are distinct in the two proceedings, and thus an overlap in remedies is not a basis for deferring here. Finally (and although this is of less importance in determining whether to defer), while both proceedings are in relatively early stages, it seems to me that the Tribunal’s process is likely to be concluded sooner than the civil action. For these reasons I consider that it is appropriate to continue processing this Application.
order
19The request to defer is denied. The respondent is directed to file its Response to the Application within 30 days of the date of this Interim Decision.
Dated at Toronto, this 3rd day of November, 2014.
Signed by
Paul Aterman
Vice-chair