GSB# 2002-2394
UNION# 2002-0121-0012
IN THE MATTER OF AN ARBITRATION
Under
THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT
Before
THE GRIEVANCE SETTLEMENT BOARD
BETWEEN
Ontario Public Service Employees Union (Grant)
Grievor
- and -
The Crown in Right of Ontario (Ministry of Finance)
Employer
BEFORE
N. Dissanayake
Vice-Chair
FOR THE UNION
Caroline V. Jones Paliare Roland Rosenberg Rothenstein LLP Barristers and Solicitors
FOR THE EMPLOYER
Lucy McSweeney Counsel Management Board Secretariat
HEARING
November 10, 2003 and January 6, 2004.
PRELIMINARY DECISION
A grievance dated November 25, 2002 filed by Mr. Donald Grant came before the Board for mediation arbitration. Following unsuccessful mediation attempts, the arbitration was commenced.
For purposes of this preliminary issue only, the parties presented to the Board the following background facts and made submissions on that basis. The grievor commenced employment with the employer in March of 1977 as a Property Assessor. In 1998 the Ontario Government decided to divest certain aspects of the Ministry of Finance including the Property Assessment Division effective December 31, 1998 to the Ontario Property Assessment Corporation (“OPAC”), now legislatively re-named as the Municipal Property Assessment Corporation. There is no dispute that at the time of the divestment, the grievor was on LTIP having been deemed to be totally disabled.
The divestment triggered the “reasonable efforts” provisions of the collective agreement. A Memorandum of Understanding was entered into between the employer and the new employer OPAC on or about December 15, 1998. In the meantime, the employer and the union had several meetings with regard to reasonable efforts, culminating in a Memorandum of Understanding dated December 21, 1998.
The relevant portion of that Memorandum reads:
It is understood that when the Ontario Property Assessment Corporation (OPAC) assumes responsibility for the delivery of property assessment functions on December 31, 1998, there may be certain OPSEU represented employees of the Property Assessment Division absent from work because of illness, disability or leave.
It is agreed that:
These employees will not commence employment with OPAC until the termination of their leave or until they are medically fit to return to work.
Until that time, they will remain employees of the Crown.
When they are able to return to work or at the termination of their leave, they will commence employment with OPAC under the terms of employment in effect at that time at OPAC for employees of their class.
The Ministry of Finance will not be required to evaluate positions occupied by these individuals.
Any increase coming into affect [sic] during this extended period of employment by the Crown will be applied to any pay received from the Crown. [It is noted that LTIP is not affected by salary adjustments].
There is no requirement for the Ministry of Finance or the Employer to attempt to negotiate adjustments with OPAC and it is understood that OPAC’s commitment to pay 100% of salaries refers to salaries in effect on December 30, 1998.
It is agreed that in his particular circumstances, the foregoing MOU applied to the grievor. In his grievance the grievor claims, inter alia, that when sometime in 2002 he indicated his medical fitness to return to work, para. 3 of the MOU obliged the employer to offer him a position with OPAC.
The employer contends that para. 3 of the MOU is patently ambiguous in relation to the meaning of the words “under the terms of employment in effect at that time at OPAC”. In addition, the employer claims that there is a latent ambiguity in the provision. On that basis the employer sought to adduce extrinsic evidence with regard to interaction between the employer and the union which preceded the execution of the MOU. The employer contends that this evidence will establish that the parties intended to place a limit of one year (from the date of divestment) on the right of employees returning from LTIP to employment with OPAC. Moreover, the employer claims that the same extrinsic evidence will establish that the union made representations agreeing to a one year time limit, which now estops the union from asserting otherwise. The Board is called upon to determine in this decision whether or not it should allow the proposed extrinsic evidence.
Patent ambiguity is ambiguity on the face of the document to be interpreted. Therefore, by its very nature, one can decide whether or not a patent ambiguity exists by examining the document itself. An examination of the MOU, particularly para. 3, does not disclose any ambiguity in the language. It clearly states that “when they are able to return”, they will commence employment with OPAC etc. It does not qualify the “when” with any time limitation. Therefore I do not find any patent ambiguity that needs to be resolved with the assistance of extrinsic evidence.
Turning next to the issues of latent ambiguity and estoppel, it is the extrinsic evidence itself that discloses the presence of a latent ambiguity or estoppel. A latent ambiguity is an ambiguity, not on the face of the document, but in its application to a particular set of facts. Extrinsic evidence can disclose a latent ambiguity in what otherwise appears to be a clear provision. It is now well established that an arbitrator may admit extrinsic evidence to disclose as well as to resolve a latent ambiguity in a collective agreement. See, R. v. Barber (1968) 1968 CanLII 446 (ON CA), 2 O.R. 245 (Ont. C.A.) and Leitch Gold Mines Ltd. v. Texas Gulf Sulphur Co. (Incorporated), (1969) 1968 CanLII 405 (ON HCJ), 1 O.R. 469 (Ont. H.C.J.).
In Re Pallota 1185/00, I observed as follows:
In contrast to a case of a patent ambiguity, it is often the case that it is the extrinsic evidence itself that creates or discloses a latent ambiguity. Besides, the employer has also raised an estoppel argument on the basis of representations allegedly made by the union through acquiescence in past practice or by conduct during negotiations. It is not possible to determine the estoppel issue without hearing the evidence that the employer claims created the estoppel. In a recent decision in Re Greater Niagara Transit Commission, award dated April 3, 2001 (Dissnayake) unreported, at pp. 5-6, I made the following observation relating to latent ambiguity:
While there is no unanimity on the issue, the jurisprudence indicates that the majority of arbitrators receive extrinsic evidence before determining whether or not a latent ambiguity exists as would justify its admission. This is not surprising, because as the courts have held, one of the purposes for which extrinsic evidence may be tendered is to disclose a latent ambiguity. Thus, Brown and Beatty, Canadian Labour Arbitration, (supra) at . 3-72 summarizes as follows:
Many arbitrators have concluded that extrinsic evidence should be received and that the ruling as to admissibility should be reserved or that the evidence should be received and the board of arbitration reserve to itself the right to determine what, if any, of the extrinsic evidence would be used to assist in the interpretation of the sections in dispute. This is particularly true where the alleged ambiguity is latent, and extrinsic evidence is tendered to disclose as well as to resolve it. Other arbitrators, however, have refused to hear the extrinsic evidence until they have decided whether there is an ambiguity. A middle course pursued by another arbitrator involves hearing the evidence until it becomes clear that it is appropriate to rule on the question of ambiguity.
(emphasis added)
It is the employer’s position that the same extrinsic evidence that will disclose a latent ambiguity will establish an estoppel against the union. Again, by its very nature, it is the extrinsic evidence that creates the estoppel. The union’s submissions and authorities, for most part, dealt with whether or not the proposed evidence discloses a latent ambiguity or establishes an estoppel. Citing several authorities union counsel submitted that estoppel cannot legally arise because the evidence will show that there was no pre-existing provision which was the subject of any representation by the union. In circumstances where the proposed extrinsic evidence is so extensive as to involve multiple hearing days, the Board has not allowed such evidence merely because a party claims “a latent ambiguity” or “an estoppel”. It has held that it “must be satisfied that there is some cogent evidence, which if established, has the potential of establishing a latent ambiguity and/or estoppel.” See Re Pallota, (supra). In those circumstances the Board directed that detailed particulars relating to the facts that will be established by the proposed extrinsic evidence be filed. The Board received submissions based on those particulars before determining whether to hear the extrinsic evidence.
In the present case, the employer assured the Board that the proposed extrinsic evidence will be relatively brief. In the circumstances, it is the Board’s determination that it should hear the proposed extrinsic evidence and receive submissions as whether or not that evidence indicates a latent ambiguity as would justify its use, and/or establishes an estoppel. This proceeding will continue in accordance with the foregoing.
Dated at Toronto this 19th day of January, 2004