Ontario Labour Relations Board

[1980] OLRB Rep. October 1519

0310-79-R; 0445-79-R Christian Labour Association of Canada, Applicant, v. Richmond Insulation Company - Division of Joy Wise Insulation Limited, Wise Insulation Limited, Respondents, v. International Association of Heat and Frost Insulators and Asbestos Workers, Local 95, Intervener; International Association of Heat and Frost Insulators and Asbestos Workers, Local 95, Applicant, v. Richmond Insulation Company, and Wise Insulation Limited, Respondents

BEFORE: N. B. Satterfield, Vice-Chairman and Board Members J. D. Bell and O. Hodges.

APPEARANCES: W. R. Herridge, Q.C., Y. Hamlin, J. Adema, R. Wright and Debra McAllister for Christian Labour Association of Canada; Ronald P. Leitch, Douglas B. Anderson and Joy Ann Wise for the respondents; B. Fishbein and J. Duffy for International Association of Heat and Frost Insulators and Asbestos Workers, Local 95.

DECISION OF N. B. SATTERFIELD, VICE-CHAIRMAN AND BOARD MEMBER J. D. BELL; October 16, 1980

1. Board File No. 0310-79-R is an application for certification and Board File No. 0445‑79‑R is an application for a declaration that the respondent Richmond Insulation Company – Division of Joy Wise Insulation Limited ("Richmond") is the successor employer to Wise Insulation Limited ("Wise") as the result of a sale of a business within the meaning of section 55 of The Labour Relations Act or, in the alternative, a declaration pursuant to the Board's discretion under section 1(4) of the Act that the two respondents be treated as one employer for purposes of the Act. Richmond Insulation Company is the style under which Richmond Insulation Limited carries on business. Following a hearing held June 11, 1979, before a differently constituted panel of the Board which dealt with certain procedural issues, an interim decision was issued June 13, 1979, in which it was directed that these files be consolidated.

2. Hearings into the merits of both applications started July 30, 1979, and continued on July 31st. Since the allegations on which the intervener ("Local 95") is relying in its intervention in the application for certification also form the basis for the application in Board File No. 0445‑79‑R insofar as it pertains to section 1(4) of the Act, the Board began by receiving the evidence of the respondents in respect of the section 1(4) and section 55 allegations pursuant to the respondent's obligation under sections 1(5) and 55(13) to adduce all facts material to the allegations. Mrs. Joy Wise, who is president and sole shareholder of Richmond and who was secretary-treasurer of Wise from its incorporation until June 1, 1979, testified in respect of both respondents but primarily in respect of Richmond. She was the first witness to be called. When the hearing was adjourned at the end of the second day she was in the midst of being cross-examined by Local 95's counsel. Her examination-in-chief had been completed and so had her cross-examination by counsel for the Christian Labour Association of Canada ("C.L.A.C."). Hearings were scheduled for continuation of these matters on September 12, 1979 and, if needed, on September 13th and 14th as well.

3. Neither of the Wises were present at the hearing on September 12th but they were represented by counsel. Counsel advised the Board that Mrs. Wise was under care of a doctor and incapable of testifying for at least three months. Counsel also advised the Board that Richmond Insulation Company had been dissolved effective September 7, 1979. Counsel had advised the other parties in writing of this turn of events and unsuccessfully sought their consent to an adjournment. This was still the situation at the commencement of the hearing on September 12th. Consequently the Board heard and considered the submissions of the parties on the request for adjournment and then adjourned the proceedings on certain conditions to be met by the respondents' counsel. These conditions were not satisfied and, at the request of counsel for C.L.A.C., the Board scheduled the applications for continuation of hearing on August 5th, 6th and 7th, 1980. These dates were set by the Registrar without consultation with any of the parties and a formal Notice of Hearing was sent to each party on July 7, 1980.

4. Counsel for the respondents advised the Board and counsel for the other parties by letter dated July 11, 1980, that he could not attend on August 5th and he was unable to contact the respondents regarding their attendance. By further letter dated July 22nd, counsel referred to the Board a letter dated July 17th from Mrs. Wise's physician which, counsel contended, indicated that the physician was prohibiting her from attending for health reasons. Counsel also advised the Board that his court schedule for September made it impossible for him to attend at the Board during that month.

5. In the absence of consent to adjourn the scheduled hearing, the Board proceeded with it on August 5th. The respondents neither appeared nor were represented. As a consequence, the Board entertained the submissions of counsel for the other parties as to how the Board should dispose of the applications in these circumstances. Upon receipt of their submissions, the Board reserved its decision and adjourned the hearing. The submissions of counsel and the Board's decision in these matters are set forth hereunder.

6. Counsel for C.L.A.C. submits that C.L.A.C. is entitled to have is application for certification adjudicated as to the date of application, since that is the date in applications pertaining to the construction industry for determining which persons are included in the bargaining unit being sought. Counsel contends, furthermore, that C.L.A.C. is entitled to that adjudication without further delay because it has been the Board's consistent practice to give precedence to and determine expeditiously applications for bargaining rights. Counsel characterizes Local 95's application as a "defense" against C.L.A.C.'s application which should not be permitted to delay further the Board's adjudication of C.L.A.C.'s application. Counsel argues that, while Mrs. Wise is testifying in order to meet Richmond's obligation under sections 1(5) and 55(13) and her inability to attend and complete her testimony is a problem in terms of meeting that obligation and the purpose which it is intended to serve, in the end the burden of proof rests on Local 95. Although Mrs. Wise's cross-examination is incomplete, she has been extensively cross-examined and counsel submits that her evidence is admissible although the weight given to it by the Board in these circumstances may be slight. In this respect counsel relies on the following authorities:

1a) Phipson on Evidence, 12th ed., p. 656 at paragraph 1591 which reads:

"When the witness dies or falls ill before cross-examination, his evidence in chief is admissible though its weight may be slight.

b) R. v. Solomon and Thumbler, (1958), 1958 CanLII 520 (MB QB), 25 W.W.R. 307, wherein the court states at page 316:

"The mere inability to cross-examine does not necessarily render the examination in chief inadmissible as evidence.".

Furthermore counsel contends that there are other competent witnesses available whose testimony could substitute for that of Mrs. Wise. Mr. Wise, who, as the former secretary of Richmond, is a person who is obliged (in keeping with the principle enunciated by the Board in Canada Cement Lafarge Ltd. and Pointe Anne Quarry Company, [1977] OLRB Rep. Jan. 5.) to inform himself of the facts material to Local 95's application. There is also a Mr. Wasley who advised Mrs. Wise from time to time on the operation of Richmond and who was hired in June 1979 by her to assist with the management of Richmond.

7. Counsel for Local 95 contends that the application for certification should be terminated because there is no longer any point to it; there is neither an employer nor any employees and therefore no bargaining unit. This latter reference is in regard to the representations of counsel for the respondents at the hearing held on September 12, 1979 that Richmond Insulation Company had been dissolved and had completed or otherwise disposed of any contracts which it had prior to that date; a situation now accepted as fact by counsel for both Local 95 and C.L.A.C. Counsel for Local 95 claims that Joy Wise Insulation Limited has amended its name to Joy Wise Investments Limited and deleted from its objects any reference to engaging in construction or insulation work. While this has not been proved as fact, it was not disputed by counsel for C.L.A.C. when the claim was made during the hearing on August 5th. Local 95 counsel cities as authorities for this contention the decisions of the Board in Sarnia Board of Education, [1969] OLRB Rep. Jan. 1025 and N. DiLorenzo Construction Limited, [1965] OLRB Rep. Apr. 33. In the former decision, between the date of the application and the hearing into it, the respondent employer, Sarnia Board of Education, had been dissolved by statute. In the result, the Board dismissed the application stating:

"There is neither an employer nor a unit of employees for whom the applicant can be certified as bargaining agent.".

In the latter decision, the Board had directed that a representation vote be held but that it be deferred until there were employees of the respondent in the bargaining unit. The Board ultimately terminated the application, with the concurrence of the applicant, because there were no employees for an extended period of time.

8. Should the Board not terminate C.L.A.C.'s application, Local 95's counsel contends that the Board should proceed with both applications only when Mrs. Wise is available. Counsel maintains that she is not an ordinary witness but is the only witness that can satisfy Richmond's obligation under sections 1(5) and 55(13) that it "…shall adduce … all facts within [its] knowledge that are material to the allegation.". Furthermore, counsel's inability to complete cross-examination leaves crucial areas of evidence on which she has not been examined (including documents which the Board had directed be produced) such as who orders and pays for supplies for both respondents and whether the respondents share equipment in common. Without this witness' evidence counsel contends that he cannot know what case, if any, he must meet through his own witnesses. For this reason, it would also be unfair for Local 95 to have to proceed out of order and call its witnesses before it can complete Mrs. Wise's cross-examination. Therefore, the Board should proceed only when Mrs. Wise can testify or when there is evidence of permanent disability prohibiting her from testifying.

9. Counsel for C.L.A.C. rebuts the submission that its application should be terminated because there is neither an employer nor any employees. Counsel argues that the same employees who were at work on the date when it was made (May 15, 1979) continued to be employed by Richmond until September 7, 1979, but more importantly they were at work on the date of the application and that is the critical date for an application for certification in the construction industry. It is as of that date which C.L.A.C. contends its application should be adjudicated. While C.L.A.C. admits that it might be unable to exercise the bargaining rights which would be established by the Board's certificate if Richmond does not resume business, it contends that it should have the bargaining rights in case Richmond should resume business or in the event that an alleged successor employer emerges.

10. The Board does not accept the contention of counsel for Local 95 that C.L.A.C's application for certification should be terminated. The Board finds this case readily distinguishable from the Sarnia Board of Education case, supra. In Sarnia the employer was legislated out of existence and could only be restored to life by an act of the legislature. The actions which are alleged to have eliminated the employer in this case were the voluntary actions of the owner of Richmond and are quickly reversible by voluntary action. Moreover, C.L.A.C. is adamantly opposed to termination of its application equally adamant to it being properly adjudicated by the Board. That stand of C. L.A.C. distinguishes this case as well from Di Lorenzo, supra. In that case, when it became evident that there may not be any employees in the reasonable future amongst whom a representation vote could be held, the applicant consented to the termination of its application. On the other hand, in Shane Distributor Limited, [1970] OLRB Rep. Jan. 1225, where an application for certification, filed on December 4, 1969 in respect of employees of Shane, was heard by the Board on January 8, 1970 after Shane had ceased doing business on December31, 1969, the Board stated that since

"…the Board dealt with applications for certification as of their date of making … [the applicant] was entitled to certification provided that it had the required evidence of membership.".

Finally, in Airline Footwear, [1968] OLRB Rep. June 277, it was claimed that the employer's business had been dissolved. The Board refused to dismiss the case because the applicant requested that the Board inquire into whether the respondent's operations had genuinely been discontinued or whether they simply had been transferred to another name. The Boards finds the circumstances of the instant case to be more analogous with those in the Shane and Airline decisions, supra and adopts the reasoning in those cases in refusing Local 95's request to terminate the application for certification.

11. The remaining submissions of both counsel confront the Board with two problems, an evidentiary problem and a fairness problem. The evidentiary problem arises if the Board should decide to proceed with and conclude this matter without Mrs. Wise having been able to complete her testimony. There are two aspects to the problem. The first aspect is what to do with her testimony; that is, should it be admitted and, if admitted, the weight that should be given to it. The second aspect is what effect might the decision to proceed without Mrs. Wise have on Richmond's ability to satisfy its obligation to adduce the facts material to Local 95's allegation and on Local 95's entitlement to those facts. The problem of fairness arises in respect of each party's entitlement to a fair hearing and the effect on that entitlement of a decision to proceed or not to proceed.

12. Turning first to the evidentiary problem, the Board is of the view that consideration of this problem may affect how the Board would conduct the hearings should it proceed with the case, but the problem should not be a factor in determining whether to proceed, except insofar as it may impact on the problem of fairness. The Board always has a duty to decide the admissibility of evidence and the weight to be given to it when the Board is hearing and deciding those matters which come before it. The fact that the circumstances of Mrs. Wise's testimony add a note of complexity is no reason for not proceeding. A similar duty applies in respect of any problems which those same circumstances might create in respect of Richmond meeting its obligations under sections 1(5) and 55(13). Again, the fact that the Board's duty might be more difficult to discharge is insufficient reason to not proceed. If the Board does proceed, it would be guided by the same principles and procedures which guided it in the Canada Cement Lafarge Ltd. and Pointe Anne Quarry Company case, supra and which are set out as follows in paragraphs 15 and 16 of that decision:

"We believe that similar principles and procedures should apply under sections 1(5) and 55(13). The obligation to adduce material facts is upon the respondent, and the witness or witnesses chosen by it should tender their evidence-in-chief. Except in exceptional circumstances (e.g., where the respondent is unrepresented), we do not believe that it is desirable for the Board to conduct the inquiry. Nothing in the recent amendments causes us to disagree with the observation of the Board in the Super City Discount Foods case, supra, that "It is not for the Board … to undertake an inquiry of its own in the matter." There may be situations where members of the panel may wish to question witnesses to have testimony clarified or amplified. However, generally speaking, it is desirable that the carriage of the proceedings be left to the parties.

Once the respondent has completed its evidence, the applicant may wish to contend that the initial obligation to adduce all material facts has not been met. In such cases, an applicant may, at that stage, ask the Board to direct compliance. In most instances, however, it would seem to us that the applicant should proceed with its cross-examination. If, in cross-examination, the witness is unable, or unwilling, to respond to questioning, and if the applicant can persuade the Board that the answer sought is likely to be material to the issues in dispute, the applicant is entitled to seek a direction from the Board requiring that the information be supplied, either by the witness informing himself or by the respondent producing the information through another witness. ... It may be noted that there is nothing to prevent an applicant from calling evidence to add to, vary or contradict the testimony of the respondent's witnesses.".

Indeed, Local 95 availed itself of these principles and procedures to have the Board direct Mrs. Wise to produce certain documents as stated earlier in this decision.

13. The more difficult issue for the Board to deal with is the parties' rights to a fair hearing. Since it was on request of counsel for the respondents that the Board granted consent for the original adjournment and in the absence of any later submissions to the contrary, the Board assumes that any problem in respect of rights to a fair hearing would arise only if the Board proceeds with these matters. In the event that the Board does proceed, there would be little or no prejudice to Wise. While some of Mrs. Wise's testimony was in respect of Wise, Gary Wise, her husband, is president and sole shareholder and absent any contrary indication would be a competent witness for Wise. He was also secretary of Richmond from its incorporation until May 10, 1979. Counsel for the respondents contends that there is potential prejudice to Richmond in proceeding without Mrs. Wise being available because no one else in either Richmond or Wise possesses the knowledge or information of the two respondents that Mrs. Wise possesses. Even if that claim is accepted at face value, it does not establish that Richmond is not without the means to limit any prejudice with might result from Mrs. Wise not being able to testify. In the Board's view, there are other sources of witnesses for Richmond. It can make its books of record available to Mr. Wise, for example, who was an officer of Richmond until one week before Local 95 made its application and who, therefore, can inform himself from those records so that he could testify for Richmond. There are customers for whom work was performed and persons who were employed by Richmond to perform that work and there are legal means to cause them to appear and give testimony.

14. While Local 95 contends that any delay in disposing of its request for a section 1(4) or section 55 declaration prejudices its attempt to protect its bargaining rights for employees of Wise, it prefers to have its application adjourned until Mrs. Wise is available to complete her testimony because it apprehends a greater prejudice to its interests from proceeding without being able to complete her cross-examination. Therefore, the Board will consider the issue of fairness in respect of Locals 95's interests only from the aspect of proceeding with these matters. There is clearly a greater risk of prejudice to Local 95 than to Richmond if the Board proceeds without Local 95 being able to complete its cross-examination of Mrs. Wise, if only for the reason hat she may be the only person having care and custody of the documents which Local 95 considers material to its case, including those which the Board has directed Mrs. Wise to produce. While there are legal means by which Local 95 can assure production of the records, it could well find itself attempting to prove the documents and examine them through its own witness rather than through cross-examination of a witness for Richmond. This is one of the difficulties which sections 1(5) and 55(13) were intended to overcome (see Canada Cemen, supra). On the other hand Local 95 has had the benefit of Mrs. Wise's testimony to date and thus has some knowledge of Richmond's operations, its customers and employees, so Local 95 is in a more knowledgeable position in terms of the case that it may have to meet than it was at the outset. Whenever the Board proceeds with Local 95's application, Local 95 bears the burden of proving its allegations. Whether Mrs. Wise completes her testimony does not alter that situation, nor does it alter Local 95's right to call evidence of its own to add to, vary or contradict the respondent's evidence, although the need to do so may be greater if Mrs. Wise cannot complete her evidence. Having regard to the foregoing, the Board views the risk of prejudice from proceeding to be greater for Local 95 than for either of the respondents.

15. The Board cannot adjudicate C.L.A.C.'s application for certification until the Board determines whether Local 95 has bargaining rights for the persons who are affected by C.L.A.C.'s application. Therefore, C.L.A.C. is clearly prejudiced by the delay resulting from further postponements of Local 95's application. In our view, the prejudice to C.L.A.C. which will result if the Board were to delay this matter further outweighs the risk of prejudice to the other parties if the Board continues with these proceedings.

16. Having regard for all of the foregoing and to the time elapsed since the case was first adjourned, the Board is satisfied that the best balancing of the parties' rights to a fair hearing would result from continuing the hearing into these matters. The Board is satisfied, also, that the lawful collective bargaining interests of the parties will, on balance, be served best by proceeding and determining the issue raised by these applications. Having further regard for the time already elapsed, the Board considers it appropriate to set peremptory hearing dates in these matters. Accordingly, the Board fixes November 18, 1980 as the hearing date for continuation of these matters and, if needed, November 19 and 20, 1980 as well.

17. The parties should be prepared to proceed on those dates whether or not Mrs. Wise appears to testify. Therefore any party that is concerned with the bona fides of Mrs. Wise's illness and her ability to attend on the dates set for hearing should take the necessary steps to establish or challenges those bona fides according to its interests.

DECISION OF BOARD MEMBER O. HODGES:

The decision of Mr. Hodges will follow.