Nakazi v. Bowland Dental Laboratories, 2017 HRTO 1204

HUMAN RIGHTS TRIBUNAL OF ONTARIO

B E T W E E N:

Eddy Nakazi Applicant

-and-

Bowland Dental Laboratories Inc., The Estate of Frank Bowland and Solaris Dental Solutions Canada Inc. Respondents

INTERIM DECISION

Adjudicator: Laurie Letheren Date: September 14, 2017 Citation: 2017 HRTO 1204 Indexed as: Nakazi v. Bowland Dental Laboratories

APPEARANCES

Eddy Nakazi, Applicant Samantha Kompa and Wade Poziomka, Counsel

Bowland Dental Laboratories Inc., and Frank Bowland, Respondents Bikram Singh Bal, Counsel

Solaris Dental Solutions Canada Inc., Respondent Cinta Gauley, Counsel

INTRODUCTION

1This Application was filed on September 10, 2015, under section 34 of the Ontario Human Rights Code, R.S.O. 1990, c. H.19, as amended (the "Code"). The Application alleges discrimination with respect to employment on the basis of disability.

2This Interim Decision addresses the issue of whether the individual respondent, Frank Bowland, should be removed as a party to this Application.

BACKGROUND

3The applicant alleges that in 2013 he was an employee of the respondent, Bowland Dental Laboratories Inc. ("Bowland Dental"). In 2013, he was on a medical leave of absence when Bowland Dental was purchased by the respondent, Solaris Dental Solutions ("Solaris"). The asset and purchase agreement ("APA") between Bowland Dental and Solaris shows that the applicant's name was not included in the a schedule that was to list all of Bowland Dental's employees in August 2013. The APA was signed by Frank Bowland as "authorized signing officer".

4Bowland Dental has advised that it has not carried on business since on or about August 23, 2015.

5At the time of the purchase, Frank Bowland was an officer and director of Bowland Dental.

6Frank Bowland died on February 21, 2017.

7On August 16, 2017, a Request for Order During Proceedings ("Request") to remove Frank Bowland as a respondent was filed.

8At a preliminary hearing held on September 6, 2017, counsel for Bowland Dental advised that Frank Bowland's wife, Donna Bowland, is the director, president, treasurer and secretary of Bowland Dental. Counsel further advised that Bowland Dental is still an active company; that he had received instructions from Frank Bowland, prior to his death, to file and address this Request; and that Donna Bowland has applied to be the estate trustee for Frank Bowland's estate.

REMOVAL OF FRANK BOWLAND AS RESPONDENT

9Bowland Dental and Frank Bowland submit that Frank Bowland should be removed as a respondent because Frank Bowland was at all times acting in the course of his employment as an officer and agent for Bowland Dental. They submit that under section 46.3 of the Code, any acts of officers and agents of a corporation are deemed to be the actions of the corporation. They submit that there are no issues of deemed or vicarious liability of Frank Bowland; and that Bowland Dental is in a position to respond to the allegations and could remedy any finding of Code breaches. They further submit that there is no compelling reason to have Frank Bowland remain as a respondent and that the applicant would not be prejudiced if he were removed.

10The applicant opposes this Request. The applicant submits that as the directing mind of Bowland Dental, Frank Bowland was responsible for the decision to leave the applicant off the list of employees. As the signing officer for Bowland Dental, Frank Bowland represented and warranted that the schedule attached to the APA contained a list of all employees including those who were on authorized leaves from Bowland Dental. As such, the applicant submits, Frank Bowland could be personally liable for the Code breach that occurred when the applicant was left off that schedule. He submits that section 46.3 of the Code is not meant to shield individual respondents from their personal liability.

11The applicant further submits that since Bowland Dental is no longer carrying on business there is a risk that should Boland Dental be found to have breached the applicant's Code rights, it would not be in a position to remedy the breach.

12The respondent, Solaris, supports the position of the applicant. In addition, it submits that it could be prejudiced should the Tribunal find that Solaris and Bowland Dental are jointly and severally liable for the Code breach. If Bowland Dental had no means of paying a monetary remedy, Solaris could be left to pay the full amount. It submits that as there has been no guarantee made by Bowland Dental that it will be in a position to pay monetary damages that could be ordered, and as a result, Solaris should not be left in this potentially prejudicial position.

DECISION

13I find that the Request to remove Frank Bowland as a respondent must be denied.

14In making a determination of whether to add or remove respondents, the Tribunal has most often considered the list of factors set out in Persaud v. Toronto District School Board, 2008 HRTO 31 at para. 5:

1. Is there is a corporate respondent in the proceeding that also is alleged to be liable for the same conduct?

2. Is there any issue raised as to the corporate respondent's deemed or vicarious liability for the conduct of the personal respondent who [is] sought to be removed?

3. Is there is any issue as to the ability of the corporate respondent to respond to or remedy the alleged Code infringement?

4. Does any compelling reason exist to continue the proceeding as against the personal respondent, such as where it is the individual conduct of the personal respondent that is a central issue or where the nature of the alleged conduct of the personal respondent may make it appropriate to award a remedy specifically against that individual if an infringement is found?

5. Would any prejudice be caused to any party as a result of removing the personal respondent?

15Although there are two corporate respondents to this Application, there remains a possibility that the Tribunal could find that Frank Bowland was personally liable for his own conduct which amounted to a breach of the Code and the Tribunal could order his estate to remedy the Breach. The Tribunal has found owners and "directing minds" of corporate respondents personally liable in carrying out corporate related functions. See Knibbs v. Brant Artillery Gunners Club, 2011 HRTO 1032, and Cunanan v. Boolean Development Ltd., 2003 HRTO 17.

16However, it remains potentially open to the Tribunal to make findings of liability and require monetary remedies specifically from the personal respondents for their actions if it was to find that these actions were discriminatory. As the Divisional Court Ontario states in Human Rights Commission v. Farris, 2012 ONSC 3876 (Div. Ct.) ("Farris"):

The fact that a corporate respondent may also be jointly and severally liable for the conduct of employees is not a basis to insulate the employees from personal liability (Drummond v. Tempo Paint and Varnish Co. (No.4) (1998), 1998 CanLII 29860 (ON HRT), 33 C.H.R.R. D/175 (Ont. Bd. Inq.)). The purpose of s. 46.3 of the Code is to confirm the parallel statutory liability of corporations for the actions of their employees, not to replace it (Reyes v. Seepersaud, 2010 HRTO 933.

17I also agree with the applicant that there is a potential risk that should the estate of Frank Bowland not remain as a respondent, the Tribunal could order a remedy that Bowland Dental would not be in a position to fulfill. The circumstances of this Application are similar to those addressed by the Superior Court was stated in Farris at para. 53:

Given the overriding purpose of human rights legislation, to provide a remedy to the complainant, it is on its face unreasonable for the Tribunal to have limited its remedial relief to an award of damages against an inoperative corporation without providing a reason that specifically addresses its finding regarding Mr. McKeague and Mr. Leonard. The risk was clear. Ms. Farris, after proceedings that lasted almost eight years and a hearing that stretched over more than 58 days, could find herself with nothing by way of a remedy in spite of the fact that the managers and owners of the company for which she worked were found to have personally violated the Code...

18I also agree with Solaris. Should the Tribunal find that it is jointly and severally liable with Bowland Dental, Solaris should not be left with the potential risk that it alone would be required to fulfill any remedies ordered.

19The fact that there is an issue as to Bowland Dental's ability to remedy a breach which could be prejudicial to the applicant and Solaris is an additional compelling reason to continue the Application against the estate of Frank Bowland.

ORDER

20The Request to remove Frank Bowland as a respondent is denied.

21The Tribunal will canvass the parties for their availability for a conference call to discuss next steps in this Application.