CITATION: Walton Enterprises v. Lombardi, 2013 ONSC 4218

DIVISIONAL COURT FILE NO.: 547/12

DATE: 20130711

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

MOLLOY, SWINTON AND HARVISON YOUNG JJ.

B E T W E E N:

WALTON ENTERPRISES o/a MIDAS AUTO SERVICES EXPERTS and DOMINIC MOLLICA

Applicants

• and -

PAUL LOMBARDI, HUMAN RIGHTS TRIBUNAL OF ONTARIO and IAN WATSON

Respondents

Philip R. White, for the Applicants

Lauren Speers, for the Respondent Paul Lombardi

Andrea A. Cole, for the Respondent Human Rights Tribunal of Ontario

HEARD at Toronto: May 31, 2013

Swinton J.:

Overview

1The Human Rights Tribunal of Ontario ("the Tribunal"), in a decision dated September 5, 2012, found that the respondent Paul Lombardi had suffered harassment in the workplace and his dismissal from employment was discriminatory. The applicants in the present application for judicial review, his former employer and manager, do not challenge the finding of harassment, but seek to quash the finding that the dismissal was discriminatory.

2For the reasons that follow, I would grant the application and set aside that part of the decision finding the dismissal discriminatory. As well, I would set aside the award of compensation for injury to dignity, feelings and self-respect, since the award did not differentiate between damages arising from the harassment and damages attributable to the dismissal.

Factual Background

3Walton Enterprises ("the Employer") is a corporation that owns five Midas auto services franchises in southern Ontario. Jack Walton is the owner and president of the Employer.

4The respondent Paul Lombardi commenced employment with the Employer on April 14, 2008 at the Midas store in Oshawa. Mr. Lombardi had been diagnosed with hypothyroidism and depression when he was in his early to mid-twenties. He was prescribed a thyroid supplement and anti-depressant medication.

5At Mr. Lombardi's request, he was granted a medical leave of absence in early June 2008. Mr. Lombardi had discontinued his thyroid medication and become tired, irritable and depressed. A doctor's note given to the Employer at the time indicated that Mr. Lombardi had discontinued medication, and he had become irritable and less able to concentrate. The note said that Mr. Lombardi had started taking the medication again and needed three weeks to recover. It also stated that Mr. Lombardi loved his job and would quickly regain his professionalism. Mr. Lombardi also testified before the Tribunal that at the time, he told Mr. Walton and his current supervisor of his depression and the fact that he was having suicidal thoughts.

6On returning to work in early July 2008, Mr. Lombardi was transferred to the Newmarket store. He did not request any accommodation for his medical condition. Mr. Walton did not inform staff in Newmarket of the medical issues out of respect for Mr. Lombardi's privacy.

7Mr. Lombardi worked as a service advisor at Newmarket, where there were seven employees. Within a couple of months there, he began to suffer verbal abuse from Ian Watson, the assistant store manager. Mr. Watson also sent text messages with homophobic slurs in July or early August 2009. The Tribunal found that Mr. Lombardi informed Mr. Walton and the store manager, Dominic Mollica, of the abuse by Mr. Watson and others.

8Mr. Watson testified that he saw a change in Mr. Lombardi's behavior in the late summer of 2009. Mr. Watson said he "backed off" and stopped using the word "faggot" to him, because Mr. Lombardi seemed more angry and upset.

9Mr. Lombardi also had disputes with two technicians that were related to the pricing and scheduling of work. In the summer of 2009, Mr. Lombardi had a verbal dispute with one of these technicians, Ali Ajaran, in which Mr. Lombardi slammed a clipboard on a counter top.

10On October 29, 2009, Mr. Lombardi approached another technician, Tim Freeborough, about doing some immediate work for a customer. Mr. Freeborough refused to stop the job he was doing and raised his middle finger. Mr. Lombardi testified that he responded with words to the effect, "one of these days someone is going to knock that attitude out of you." A fist fight broke out, and Mr. Mollica had to intervene to stop it. Mr. Freeborough suffered injury to his face, including a black eye. There is no indication in the evidence that Mr. Lombardi was injured.

11Each participant blamed the other for starting the fight. Mr. Lombardi testified that he hit back to defend himself. Indeed, Mr. Lombardi states in a December 2009 letter to Mr. Walton that Mr. Freeborough hit him three times before he responded, and he fought back to "protect and stand up" for himself. He also testified that he did not back down because Mr. Freeborough was punching him and "with all the ridicule – after all the remarks about the feminine traits, imagine what the guys would have said about it if I had backed down" (Reasons, p. 26).

12The customer and another employee, Mr. Ajaran, identified Mr. Lombardi as the one who threw the first punch. After confirming this, Mr. Walton dismissed Mr. Lombardi on October 31, 2009 because he concluded Mr. Lombardi had started the fight.

13At the time of the dismissal, Mr. Lombardi again maintained that he had not started the fight. At no time prior to his dismissal did he indicate to the Employer that he had acted as he did because of his depression or because of the past harassment. Even in the letter of December 2009, he explains that the fight was caused by Mr. Freeborough and he had fought back to "protect and stand up for myself." While he talks about Mr. Watson's harassment later in the letter, and the fact that stress can lead to emotional outbursts of anger, he mentions that in conjunction with interactions with Ali A and Ali K, not Mr. Freeborough.

14Mr. Lombardi then filed an application under the Human Rights Code, R.S.O. 1990, c. H.19 ("the Code") claiming harassment and discrimination in employment based on disability, sex, sexual orientation and family status.

The Decision of the Human Rights Tribunal

15The Tribunal found that Mr. Lombardi had been harassed on the grounds of disability (depression and perceived obesity) and sex (perceived homosexuality) during his employment, largely through text messages and comments from Mr. Watson. The harassment was found to have been known to and condoned by the Employer. Mr. Watson and Mr. Mollica were found individually liable. The corporate respondent was held liable because of the knowledge of the harassment and the failure to take action against it.

16The adjudicator then considered whether the applicant had been dismissed for behaviour connected to discrimination. She had said earlier in her reasons that it did not matter whether Mr. Lombardi started the fight, but she assumed he did so (Reasons, para. 117). She found that the "fight was at least in part a reaction by the individual applicant to being harassed in the course of his employment" (Reasons, para. 158).

17I note that this statement is inconsistent with an earlier statement at para. 10 of the reasons, where she said, as part of an overview, "I have also concluded that the harassment, and his ongoing depression, was part of the reason for the applicant's involvement in the fight that was the cause of the termination of his employment" (emphasis added). Depression was not identified as a factor in the fight in the section of the reasons dealing with dismissal.

18With respect to corporate liability, the adjudicator noted that Mr. Walton made the decision to dismiss. She then stated that Mr. Walton was on notice that Mr. Lombardi had a disability (depression), and that Mr. Lombardi continued to require medication for that disability. Given the knowledge about the depression and of the complaint of harassment, Mr. Walton had a duty to inquire into the possibility that there was a causal link between the harassment, Mr. Lombardi's depression and the fist fight before terminating his employment. As he failed to do so, she held the corporation responsible for the discriminatory dismissal. However, she also stated that had the corporation made the proper inquiry, it "might have concluded that neither the applicant's depression nor the harassment were sufficiently closely linked to the fight" (Reasons, para. 166).

19The adjudicator ordered compensation of $20,000 for injury to dignity, feelings and self-respect caused by the termination of employment and the harassment. She also ordered compensation for lost income from October 31, 2009 to August 31, 2010.

The Issues in this Application for Judicial Review

20The applicants do not challenge the finding of harassment. However, they argue that the adjudicator reached an unreasonable decision in finding the dismissal was discriminatory. The applicants argue that the adjudicator failed to apply the proper test to determine whether the dismissal was discriminatory, in that she did not first determine whether Mr. Lombardi established a prima facie case of discrimination. As well, the adjudicator unreasonably found a causal link between the dismissal and the depression in the absence of any supporting medical evidence. Finally, she unreasonably found that the harassment was a cause of the dismissal that justified an order of compensation.

The Standard of Review

21The standard of review of the Tribunal's decision is reasonableness (Shaw v. Phipps, 2012 ONCA 155 at para. 10).

22Reasonableness is concerned with justification, transparency and intelligibility in the decision-making process. A decision should be upheld if it falls within a range of possible, acceptable outcomes, given the facts and the law (Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190 at para. 47).

Analysis

The Adjudicator's Reasons Respecting Dismissal

23The adjudicator's reasons finding that Mr. Lombardi was dismissed for behaviour connected to discrimination or harassment are three paragraphs in length. The adjudicator begins this section of the reasons by stating that other cases have found a dismissal "may" infringe the Code "where a discriminatory working environment results in the person targeted becoming confrontational, aggressive and arrogant, and this response triggers a dismissal". She cites three cases to which I shall return later: Naraine v. Ford Motor Co. of Canada (No. 4) (1996), 1996 20059 (ON HRT), 27 C.H.R.R. D/230 (reinstatement remedy overturned by Court of Appeal, Docket C32965, December 14, 2001); Smith v. Mardana Ltd. (No. 2), 2002 46512 (varied (2005), 195 O.A.C. 323 (Div. Ct.); and Krieger v. Toronto Police Services Board, 2010 HRTO 1361.

24The adjudicator then states that while there was a dispute as to who started the fight, Mr. Lombardi testified that he did not "back down" because "with the ridicule – after all the remarks about the feminine traits, imagine what the guys would have said if I backed down" (Reasons, para. 157).

25The adjudicator agrees with the Employer's submission that there was no evidence that a person with depression or hypothyroidism would be more likely to engage in workplace violence than an employee without those conditions. She then completes this section with the following sentence: "I find that the fight was at least in part a reaction by the individual applicant to being harassed in the course of his employment" (Reasons, para. 158). That sentence is the total analysis on the issue of whether the dismissal was discriminatory.

The Applicable Code Provisions

26Subsection 5(1) of the Code provides that every person has a right to equal treatment in employment without discrimination on a number of grounds, including disability and sex. Section 9 of the Code provides that no one shall infringe a person's right to equal treatment.

27In order to establish that a person has contravened s. 5(1) of the Code, the onus is on the applicant to prove a prima facie case of discrimination on a protected ground. If he or she does so, the evidentiary burden then shifts to the respondent to establish that he or she had a credible and acceptable explanation for the conduct (Shaw, above at paras. 12 and 13).

28In Shaw at para. 14 and more recently in Peel Law Association v. Pieters, 2013 ONCA 396 at para. 59, the Court of Appeal has discussed the elements required to show a prima facie case, holding that the applicant must prove:

1. he or she is a member of a group protected by the Code,
2. he or she was subject to adverse treatment, and
3. there was a connection between the adverse treatment and the ground of discrimination invoked.

29The Court of Appeal has also stated that "Relatively 'little affirmative evidence' is required before the inference of discrimination is permitted". Once the inference has been shown to be more probable than not, the respondent has to "explain or risk losing" (Peel at para. 73). Both Shaw and Peel are cases involving allegations of racial discrimination in the way in which the applicants were treated.

The Case Law Cited by the Adjudicator

30The adjudicator cited three cases in support of her comment that a dismissal may be discriminatory "where a discriminatory working environment results in the person targeted becoming confrontational, aggressive and arrogant, and this response triggers a dismissal". Two of the cases cited, Naraine and Smith, dealt with the dismissal of an employee who had been the target of racial harassment. The third case, Krieger, was not a harassment case, but rather a case involving the dismissal of an employee with a disability.

31Naraine is the case most on point in the present case. The complainant had a lengthy disciplinary record when he was dismissed for assault on another employee. At his exit interview, he raised the issue of racism in the workplace. The Board of Inquiry examined the evidence carefully and found there was a poisoned work environment because of widespread racism in the workplace. The Board member held that the employer should have taken the employee's complaint of racism seriously and pursued an investigation (at para. 93). She had expert evidence on the nature of racism in the workplace and its impact on victims, and she found as a fact that all of the complainant's outbursts were provoked by the racist environment (at para. 101).

32Notably, the Board member in Naraine found that the complainant's conduct warranted discipline on two occasions: when he threatened or inflicted physical harm on another individual (at para. 103). She explicitly stated that the verbal threats and physical contact with another employee were disciplinable acts. While they might have justified a lengthy suspension if properly investigated, she found that they did not justify termination. Ultimately, she found that there was a causal connection between the poisoned work environment and the termination, stating

Where racial and ethnic conflict contribute to the altercation which results in a discharge, the discharge is unlawful. The real reason for the termination is not the altercation, but the underlying factors of racial discrimination and harassment. By disciplining an employee in such circumstances, an employer is condoning the discriminatory conduct (at para. 104).

33The adjudicator in the present case also relied on Smith, where the Tribunal also found that the complainant had been a victim of racial harassment. While the Tribunal found that race was not a factor in his dismissal, this finding was overturned by the Divisional Court, because the Tribunal had failed to properly consider the full factual matrix. The Court found that the circumstances of the dismissal were suspect, given the nature of Mr. Smith's conduct (refusal to assist a junior employee in serving a customer), the lack of an opportunity to explain, the fact that two white employees were treated less severely for more serious conduct, as well as issues of timing and the opposition of his immediate supervisor to dismissal (at paras. 15-17). Citing Naraine, the Court stated, "When termination occurs within a poisoned work environment, a proper consideration of whether the termination was discriminatory requires that it be examined in the context of the poisoned work environment" (at para. 24).

34In Krieger, a probationary police constable was involved in a confrontation with a suspect that resulted in the development of post-traumatic stress disorder, although he was not diagnosed with the condition immediately. He subsequently engaged in a confrontation with another suspect that ultimately led to the termination of his employment. The Tribunal found the release to be discriminatory on the basis of disability, finding that the employer had good reason to suspect the individual was suffering from mental health problems around the time of the second incident. The employer was subsequently given information about the medical condition after the complainant obtained treatment, but before the dismissal occurred. The Board found that the dismissal was a result of the disability, and the employer failed to meet its duty to accommodate.

35In each of those three cases, there was a careful analysis of the circumstances of the dismissal to assess the extent to which either disability or a racialized environment was a factor in the dismissal.

The Gaps in the Adjudicator's Analysis

36In contrast to those three cases, the adjudicator in the present case has failed to conduct the necessary analysis of the legal principles and the evidence. All one finds in the reasons is a bald statement that the fight was at least in part a reaction to the harassment.

37The adjudicator was aware that an applicant like Mr. Lombardi had an evidentiary onus to prove a prima facie case of discrimination (Reasons, para. 8). She also correctly stated that once the applicant proves a prima facie case, the burden shifts to the respondent to "provide a credible and rational explanation that its actions were not discriminatory". However, she failed to apply this analysis in support of her finding that the dismissal was discriminatory. On reading her reasons, it is unclear whether she found a prima facie case of discrimination and did not accept the Employer's explanation for the dismissal, or whether she found a causal link between the harassment, Mr. Lombardi's mental state and the fight, as in Naraine.

38The adjudicator made no finding that Mr. Lombardi's medical conditions (depression and hypothyroidism) were a factor in the dismissal. Moreover, there is nothing in the evidence to suggest that Mr. Walton used the fist fight as an excuse to dismiss Mr. Lombardi in retaliation for the harassment complaints or because Mr. Lombardi suffered from a disability.

39If the argument is that Mr. Lombardi suffered indirect discrimination by being dismissed, he had an onus to show there was a sufficient connection between the harassment and the fight to amount to a prima facie case of discrimination. I note that in cases dealing with an employee who claims his or her misconduct was caused by a disability such as drug addiction or alcoholism, the employee has been required to prove a causal relationship between the addiction and the misconduct (Fleming v. North Bay, [2010] HRTO 322 at para. 73). Both the British Columbia and Alberta Courts of Appeal have held that an employee who engaged in misconduct that rose to the level of a crime could not prove discrimination on the basis of disability where the disability played no part in the employer's decision to dismiss and the employee suffered no greater impact for the misconduct than any another employee would have suffered (British Columbia (Public Service Agency) v. British Columbia Government and Service Employees' Union, 2008 BCCA 357 at para. 15; Wright v. College and Assn. of Registered Nurses of Alberta, 2012 ABCA 267 at para. 58).

40As a consequence, it was incumbent on the adjudicator to examine and make findings about the key event that led to the dismissal – the fight – and the role the harassment played in the fight. In order to come to a reasoned decision that the dismissal was discriminatory, she had to determine what happened: who started the fight; what was Mr. Lombardi's role in it; and what impact did the harassment have on Mr. Lombardi's participation? As there was conflicting evidence on these issues, the adjudicator needed to make findings of credibility, particularly with respect to Mr. Lombardi's evidence, in order to explain and justify her decision.

41Mr. Walton gave evidence on behalf of the Employer that he investigated what happened at the time of the fight. The customer and another employee who witnessed the altercation stated that Mr. Lombardi started the fight. Clearly, the fight was a serious concern for the Employer, particularly in light of the fact that Mr. Freeborough received a black eye in the altercation. Such conduct would reasonably justify discipline of an employee, as the Board of Inquiry noted in Naraine.

42Weighed against that evidence was Mr. Lombardi's testimony that he did not start the fight. Rather, he testified that "he did not back down when Mr. Freeborough opposed him", because he did not want to be accused of unmanliness. Indeed, he had taken the position in his December 2009 letter to Mr. Walton that he was hit three times before he responded. Moreover, there is no suggestion that Mr. Freeborough was harassing him at the time of the fight. Rather their dispute was over the timing of different jobs for customers. In the December letter, Mr. Lombardi states that he had been met with "attitude and resistance as usual".

43Given the two different versions of events, the adjudicator should have determined whether Mr. Lombardi's explanation about the fight was credible or not. If he did indeed start the fight, there might be a question whether the harassment he had suffered was a contributing cause. However, his credibility on that issue would have come into question, given his lack of forthrightness with respect to the fight.

44In any event, his assertion that the fight was a result of the harassment should have been assessed in light of all the evidence. I note that at no time, either immediately after the fight or in the letter in December 2009, did Mr. Lombardi indicate that his mental state had led him to lose control and engage in the fight. While the December letter stated that he was stressed because of harassment, no link was made between the fight with Mr. Freeborough and the stress. In contrast, in the Naraine case, the complainant raised the harassment issue at the time of dismissal.

45Unlike Naraine, there was minimal evidence at the hearing to prove Mr. Lombardi's mental state or to show a connection between the violence and the past harassment. Mr. Lombardi made some connection when he stated that he did not want to back down and be seen to be unmanly. As well, there was evidence from Mr. Watson that Mr. Lombardi's behaviour had changed in the summer, which led Mr. Watson to change his conduct. However, there was no medical evidence that Mr. Lombardi was suffering from stress around the time of the fight, linked to the harassment, which might explain his lack of control. In contrast, in Krieger, there was medical evidence to support a link between the conduct leading to the dismissal and a protected ground under the Code - there, disability.

46Given the evidence as to Mr. Lombardi's responsibility for starting the fight, the lack of any explanation to the Employer about the impact of the harassment, the lack of any medical evidence relating to mental distress and given the seriousness of the misconduct, the conclusion that the dismissal was discriminatory was unreasonable, as the adjudicator failed to show why she reached that conclusion.

47There are other places in the reasons, although not in the dismissal section, where the adjudicator links the harassment, the depression and the dismissal. Elsewhere, she states that "the fight was in part a reaction by an individual dealing with depression to being harassed" (at para. 166) and "the harassment, and his ongoing depression, was part of the reason for the applicant's involvement in the fight" (at para. 10).

48To the extent that the adjudicator is making a link between the applicant's depression and the fist fight, she had no evidentiary basis for doing so. There were only two items of medical evidence before her. First, there was the doctor's note supporting a leave in July 2008, which indicated that after a few weeks of readjusting to medication, Mr. Lombardi would act in a professional manner. There was mention of irritability and lack of concentration, but no suggestion of any risk of violence. The medication referred to was apparently for his thyroid. No request for accommodation was sought on his return to work. Second, there was a medical questionnaire filled out by the same doctor in August 2011, well after the dismissal. It states that Mr. Lombardi's current medical condition of depression requires no special assistance and that he has no limitations.

49Thus, nowhere in the evidence is there any indication that Mr. Lombardi's depression was not under control with medication at the time of the fight, nor that there was a link between his depression and the fight. Therefore, to the extent that the adjudicator appears to have found a link between the depression and the fight, that link is not explained in the reasons nor supported by the evidence. The finding is, therefore, unreasonable.

50The adjudicator also held that the Employer had a duty to inquire into the possibility of a link between Mr. Lombardi's depression and the harassment and the fight before dismissing Mr. Lombardi. Again, the reasoning is difficult to follow. This finding is made in a section of the reasons dealing with corporate responsibility and the application of s. 46.3(1) of the Code, a provision deeming the acts of corporate officials to be the acts of the corporation in certain circumstances. It is difficult to understand why the adjudicator needed to consider this provision in relation to the dismissal, which was clearly an act of the corporate respondent carried out by Mr. Walton, its directing mind.

51In any event, the adjudicator failed to show the basis for finding a duty to investigate before dismissal absent first finding a prima facie case of discrimination arising from the dismissal.

52This is not a case like Krieger, above, where a disability was proven and a clear link established between the dismissal and that disability. This triggered a duty to accommodate under the Code. Here, the evidence does not establish any such link between the depression and the dismissal. As there was no link to disability and no prima facie case of discrimination shown, the Employer did not have a duty to accommodate a disability, as in Krieger.

53Moreover, Mr. Lombardi had the primary obligation to ensure that the Employer had sufficient information to trigger its duty to investigate whether he required accommodation. Mr. Lombardi had never sought accommodation, and the medical evidence suggests no need for any accommodation, since his depression appeared to be controlled with medication. The present case stands in contrast to the Tribunal's statement in Simpson-Bolwyn v. Commissionaires (Great Lakes), 2009 HRTO 1362 of the "well-established principle that accommodation is a collaborative process and that the applicant should endeavor to provide as much information as possible" (at para. 35).

54But even if there were a duty to investigate before the dismissal, the adjudicator again fails to explain why the Employer is liable. She states that had the Employer undertaken an investigation, it "might have concluded that neither the applicant's depression nor the harassment were sufficiently linked to the fight." With respect, she was required to determine whether the evidence showed such a link, as liability for a discriminatory dismissal does not rest on a freestanding duty to investigate.

55Again, the adjudicator's approach is in contrast to Naraine, where the Board found and explained the connection between the harassment and the misconduct. Here, the evidence shows no connection between the depression and the fight, and Mr. Lombardi never suggested that there was a link between the harassment and the fight when Mr. Walton told him of the dismissal or, indeed, after the dismissal. He said he did not start the fight, while Mr. Walton had good reason to believe that Mr. Lombardi did so, having made inquiries about what happened and disbelieving Mr. Lombardi's version of events. Again, the key issue the adjudicator needed to determine was the responsibility for the fight and the role of harassment therein.

56In sum, the adjudicator's reasons do not meet the requirements of justification, transparency and intelligibility set out in Dunsmuir. She failed to properly assess whether the dismissal was discriminatory in light of governing legal principles and the evidence. Even if she accepted Mr. Lombardi's evidence as showing a prima facie case, she had an obligation to consider all the evidence to determine whether the conduct merited dismissal, given the Employer's conclusion that Mr. Lombardi threw the first punch and given the gravity of that conduct. As she failed to do so, her finding that the dismissal was discriminatory is unreasonable and must be set aside.

57That leaves the issue of the proper remedy in this application for judicial review. While the Employer did not take issue with the finding of harassment, the compensation ordered by the Tribunal for general damages was based both on the dismissal and the harassment. Clearly, the amount of $20,000 would have been reduced had the dismissal not been found to be discriminatory. Accordingly, there must be a reassessment of the appropriate quantum of compensation for harassment.

Conclusion

58The application for judicial review is granted. The decision of the Tribunal respecting the discriminatory dismissal and remedy is set aside, and the matter is referred back to the Tribunal for a new hearing on the issue of the dismissal, as well as the appropriate remedy.

59Costs to the applicants are fixed at $5,000.00 all inclusive payable by Mr. Lombardi.

Swinton J.

Molloy J.

Harvison Young J.

Released: July 11, 2013

CITATION: Walton Enterprises v. Lombardi, 2013 ONSC 4218

DIVISIONAL COURT FILE NO.: 547/12

DATE: 20130711

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

molloy, swinton and harvison young jj.