McCullough v. Toyota Motor Manufacturing Canada, 2016 HRTO 1033

HUMAN RIGHTS TRIBUNAL OF ONTARIO

B E T W E E N:

Steven McCullough

Applicant

-and-

Toyota Motor Manufacturing Canada

Respondent

DECISION

Adjudicator: Bruce Best

Date: August 4, 2016

Citation: 2016 HRTO 1033

Indexed as: McCullough v. Toyota Motor Manufacturing Canada

APPEARANCES

Steven McCullough, Applicant

Self-represented

Toyota Motor Manufacturing Canada, Respondent

Ted Kovacs, Counsel

Introduction

1This Application alleges that the respondent has contravened minutes of settlement, contrary to the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”). The Application was heard by telephone conference call on April 19, 2016.

2The parties entered into minutes of settlement on August 12, 2015 in a previous application before the Tribunal. Pursuant to para. 3 of the settlement, the respondent was required to re-issue a Record of Employment (“ROE”) for the applicant. The initial draft of the settlement did not specify any deadline, but the applicant specifically required that the ROE be re-issued by Friday, August 28, 2015. This amendment was handwritten into the settlement and agreed to by the respondent. In para. 7 of the settlement, the respondent was also required to provide a letter of employment, though that paragraph did not specify a deadline as to when the letter would be sent.

3The respondent did not re-issue the ROE on Friday, August 28, 2015. The applicant filed this Application via email the following Wednesday, September 2, 2015, at 4:51 AM, copying Mark Geene from the respondent’s human resources department, who had been the company representative at the August 12, 2015 settlement negotiations. At 7:16 AM, Mr. Geene responded to the applicant’s email, including a copy of an ROE and the letter of employment. The applicant noted that there was a mistake on the ROE, which Mr. Geene promptly had corrected. The parties agree that as of 9:16 AM on September 2, 2015, the date the Application was filed, the terms of the settlement had all been met. The Response was filed the next day, on September 3, 2015.

4At the hearing, the applicant testified on his own behalf, and Mr. Geene testified on behalf of the respondent.

5The applicant testified that he required the Friday, August 28, 2015 deadline in the settlement for two reasons. First, he claims that he had an appointment on Tuesday, September 1, 2015, with “Second Career” to register for a commercial truck driver’s course. He testified that he had been told that he had to register at least 30 days in advance of the October 1, 2015 start date for the course, and that in order to register he needed his re-issued ROE. As the respondent failed to re-issue the ROE as required under the settlement, the applicant cancelled the September 1 appointment. The applicant seeks damages for the lost wages he could have earned as a commercial truck driver starting from the completion of the October 2015 course.

6Second, he testified that he had been told by Employment Insurance (“EI”) that he had to have his ROE re-issued by August 28, 2015 or there would be a delay in his receiving his EI benefits. He further testified that his EI benefit period subsequently expired, and that, as a result, he ultimately lost three weeks of EI benefits.

7In cross-examination, the applicant was asked whether he had attempted to contact the respondent between Friday August 28, 2015 and the morning of Wednesday September 2, 2015 to indicate that he had not received the ROE. He acknowledged that he could have contacted Mr. Geene before the Second Career appointment, but that he did not because he felt he had to prepare this Application first. The applicant did acknowledge that Mr. Geene, once notified, immediately corrected and apologized for the error.

8The respondent acknowledges that the ROE was not sent on August 28, 2015. Mr. Geene claimed that he had notified the respondent’s payroll department of the deadline in the settlement, and that it was up to it to file the ROE. In the Response, the respondent claimed that the failure to issue the ROE as required was due to a difficulty accessing the Service Canada website on August 28. The respondent did not provide any direct evidence on this issue at the hearing, though Mr. Geene testified that this is what he had been told by payroll.

9The applicant questioned this explanation in cross-examination, noting that even if there were problems with the Service Canada website on August 28, this does not explain why the ROE was not then issued on either of the next business days of August 31 or September 1. He also noted that if the respondent had in fact tried to file the ROE on August 28, it would have been dated August 28, but it was in fact dated September 2. He suggested that this indicated the respondent had not, in fact, tried to file the ROE prior to September 2.

Analysis and Decision

10Sections 45.9(1), (3) and (8) of the Code read as follows:

45.9 (1) If a settlement of an application made under section 34 or 35 is agreed to in writing and signed by the parties, the settlement is binding on the parties.

(3) If a settlement of an application made under section 34 or 35 is agreed to in writing and signed by the parties, a party who believes that another party has contravened the settlement may make an application to the Tribunal for an order under subsection (8)

(8) If, on an application under subsection (3), the Tribunal determines that a party has contravened the settlement, the Tribunal may make any order that it considers appropriate to remedy the contravention.

11A settlement is a contract. The determination of liability under s.45.9(8) should be based on contractual principles. See Saunders v. Toronto Standard Condominium Corporation Corp. No. 1571, 2010 HRTO 2516, at paras. 37-39. Similarly, the assessment of the appropriate remedy should also be guided by contractual principles. See Glover v. 571566 Ontario Inc., 2011 HRTO 1563 (“Glover”) at paras. 35-45, and Keating v. 2229884 Ontario Inc., 2015 HRTO 1677 (“Keating”) at para. 65.

Letter of Employment

12The respondent submits that the settlement did not specify a date for delivery of the letter of employment, and as such there is no breach of that provision. The applicant submits that, even though not explicitly specified, the letter should nonetheless have been provided on August 28.

13A specific deadline could have been included in the settlement, as it was for the ROE. Though the absence of a deadline does not mean a party can unduly delay compliance, in this case the letter was sent promptly, within weeks of the signing of the settlement. I find that in the absence of a specific deadline, and given that the provision was in any case promptly met, the respondent did not breach the settlement with respect to the letter of employment.

Record of Employment

14There was, however, a specific deadline for the ROE. There is no dispute that pursuant to the settlement the ROE should have been re-issued on August 28, 2015, and that this was not done.

15The respondent argues that it was, nonetheless, in substantial compliance with the terms of the settlement, noting that the Tribunal has on several occasions refused to grant any remedy where there was a minor delay in satisfying the terms of a settlement, relying on the general legal principle that “the law does not concern itself with trifles” (“de minimis non curat lex”, or commonly “de minimis”). See Budan-Hughes v. Clemmer Steelcraft Technologies, 2009 HRTO 1618 (“Budan-Hughes”), at para 9.

16The issues of “substantial compliance” and “de minimis”, though related, are distinct, and I will address them separately, the first deals with whether the delay could be considered a breach at all, the second with whether, given the fact of a breach, there should be any remedy.

Substantial Compliance

17If the ROE had been filed by the date specified in the settlement, but contained a minor or inconsequential error, that may have been enough to amount to substantial compliance with the terms of the settlement. However, where there was a specific requirement to provide the document by a specific date, and that date was not met, the respondent cannot be said to be in substantial compliance with the settlement.

18In Runnymede Iron & Steel Ltd. v. Rossen Engineering and Construction, 1961 CanLII 20 (SCC), the Supreme Court quoted the House of Lords in Arcos, Ltd. v. E.A. Ronaasen and Son, [1933] A.C. 470, 102 L.J.K.B. 346.

At page 479, Lord Atkin said:

It was contended that in all commercial contracts the question was whether there was a “substantial” compliance with the contract: there always must be some margin: and it is for the tribunal of fact to determine whether the margin is exceeded or not. I cannot agree. If the written contract specifies conditions of weight, measurement and the like, those conditions must be complied with. A ton does not mean about a ton, or a yard about a yard.

No doubt there may be microscopic deviations which business men and therefore lawyers will ignore.

19In my view, the same principles would apply with respect to deadlines. “By August 28, 2015” does not mean “within a week of August 28, 2015”. Where a settlement requires something to be done by a specific date, and that deadline is missed by a number of days, there cannot be said to be substantial compliance, and there is still a contravention of the settlement.

De minimis

20The respondent also argued that the delay was de minimis, as the breach was minor and corrected promptly. It relied on a number of cases where the Tribunal has held that a brief delay in the payment of money that resulted in only a few days of interest accruing will usually be de minimis. See Budan-Hughes at para. 9 (delay of 8 days); Adorgloh v. Sentrex Communications, 2010 HRTO 2524 (“Adorgloh”) at para. 19 (delay of 3 days); Matos v. Transplay, 2010 HRTO 2527 (“Matos”) at para. 17 (delay of 8 days); and Francis v. Toronto Police Services Board, 2011 HRTO 2018 (“Francis”), at para. 14-15 (delay of 10 days).

21However, the de minimis principle was applied in the above cases taking into account both the delay and the damages that flowed from it. This does not mean that all short delays in satisfying a settlement will be de minimis and should not be considered by the Tribunal. The real question is whether the delay is so short and the damages are so trivial that no remedy should be awarded. This, of course, will first require an assessment of what the damages are.

22Based on the above, I find that the respondent was not in substantial compliance with the terms of the settlement, and as such contravened the settlement by failing to provide the ROE by August 28, 2015. The issue in this case is what remedy, if any, flows from the breach.

Damages and Remedy

23As noted above, the determination of an appropriate remedy under s.45.9(8) should be based on contractual principles. Glover, at paras. 36-37, stated as follows:

In Fidler v. Sun Life Assurance Co. of Canada, [2006] 2. S.C.R. 3, at paragraph 55, the Supreme Court of Canada re-affirmed that Hadley v. Baxendale (1854), 9 Ex. 341, 156 E.R. 145 establishes “the single and controlling test for compensatory damages in cases of breach of contract”. That test is that damages must be "such as may fairly and reasonably be considered either arising naturally ... from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties”.

The damages which can be said to be within the reasonable contemplation of the parties fall into two categories: those which it would be objectively reasonable to have expected, regardless of actual knowledge; and such additional damages as it would be objectively reasonable to expect would arise from special circumstances of which there is actual knowledge.

24The applicant has claimed damages arising from the breach on two grounds; first, that he was unable to register for a trucking course, and second, that he lost three weeks EI benefits.

Trucking Course

25I find that the damages claimed by the applicant with respect to the Second Career appointment and trucking course were not within the reasonable contemplation of the parties. There is no indication that the respondent had actual knowledge that the ROE was required for this reason. The damages claimed are also sufficiently remote that it would not be objectively reasonable for the respondent to have expected them, absent actual knowledge that this was the reason for the deadline. As such, I decline to grant the applicant’s claim for damages respecting the Second Career interview and trucking course, on the basis that they are too remote, and could not be reasonably held to be within the contemplation of the parties.

Employment Insurance

26With respect to the claim for EI benefits, however, I find that some damages were reasonably foreseeable, when taking into account both the special knowledge of the respondent and what would be objectively reasonable in the circumstances.

27Given that the applicant had explicitly required the insertion of a deadline in the settlement, it would be reasonable to expect that there may be consequences for failure to ensure that the deadline was met. The primary purpose of an ROE is to permit Service Canada to determine eligibility for and the amount of EI benefits. The respondent, as a sophisticated employer, would be aware of that. The respondent would also have been aware of the applicant’s personal circumstances from the previous application, and that he had been out of work for a considerable amount of time. It would also have been aware that there are limits on the period that EI benefits are payable, and that a delay in issuing an ROE may result in fewer benefits ultimately being received by a former employee. In my view, it was within the reasonable contemplation of the parties that the failure to re-issue the ROE by the date required would affect the applicant’s EI benefits.

28I accept the applicant’s evidence that the delay in issuing the ROE resulted in a delay in his receiving EI, and that this delay contributed to his ultimately losing benefits due to the expiry of the benefit period. However, he was not able to explain, even when directly questioned on this issue at the hearing, how the delay of less than one week in re-issuing the ROE ultimately resulted in his losing a full three weeks of benefits. As such, I cannot find that the loss of all three weeks can all be attributed to the delay in issuing the ROE.

29I do find, however, that the delay in re-issuing the ROE resulted in a one-week delay in his receiving EI benefits. I also accept that the applicant’s evidence that his benefit period expired before he had exhausted his benefit entitlement. For the reasons above, I find that this loss was reasonably within the contemplation of the parties, and that the applicant has been able to establish damages equivalent to one week’s employment insurance benefits, which in 2015 would have been $524.

Failure to contact the Respondent

30One of the main arguments raised by the respondent at the hearing was that if the applicant had simply contacted Mr. Geene earlier, the ROE would have been issued immediately, he would not have missed his Second Career appointment, and he would not have incurred the damages claimed. The applicant acknowledged that Mr. Geene immediately rectified the breach once he received the Application in the early morning of September 2. With the benefit of hindsight it may well be that Mr. Geene would have responded equally promptly had the applicant contacted him on the Monday or Tuesday. The applicant took the position, however, that he had no obligation to contact Mr. Geene.

31I note that in at least one case, Budan-Hughes, at para. 9, the Tribunal has suggested that failure to contact a respondent with respect to a breach prior to filing an application under s.45.9(3) may be a relevant factor to consider. However, in the circumstances of this case, I do not need to determine whether the applicant had an obligation to notify the respondent once it was in breach of the settlement.

32First, I have accepted the applicant’s evidence that the failure to re-issue the ROE by the deadline of August 28, 2015 resulted in a loss of one week’s employment insurance benefits, and that such a loss was within the reasonable contemplation of the parties. Given that finding, and given that employment insurance benefit period is based on a week, even if the applicant had contacted Mr. Geene on August 31 or September 1 and the ROE had been issued then, that loss would still have been incurred.

33Second, given my findings that the damages relating to the trucking course were not within the reasonable contemplation of the parties in any case, it is not necessary for me to determine whether such damages could have been avoided.

Order

34The respondent shall, within 30 days of the date of this Decision, pay to the applicant $524 to remedy the contravention of the settlement.