United Food and Commercial Workers International Union v. Sunnylea Foods Limited, 1981 CanLII 988

[1981] OLRB Rep. November 1640

2145-80-U; 2146-80-R; 2147-80-R United Food and Commercial Workers International Union, Complainant, v. Sunnylea Foods Limited; Maple Leaf Egg Products Ltd.; Turkstra's Eggs Ltd.; Jacob Zonneveld, Respondents.

BEFORE: George W. Adams, Chairman and Board Members J. A. Ronson and W. F. Rutherford.

APPEARANCES: James Hayes, Don Layman and Michael Bowman for the applicant/complainant; David E. Ivev', Herman Turkstra, and Jack Zonneveld for Sunnvlea Foods Limited and Jacob Zonneveld; and C. M. McKeown and Jules Lewy for Maple Leaf Egg Products Ltd. and Turkstra's Eggs Ltd.

DECISION OF THE CHAIRMAN; November 24, 1981

1. These matters involve an application under section 63 of the Labour Relations Act and a complaint filed under section 89 alleging violations of sections 64,66 and 70. The United Food & Commercial Workers International Union (hereinafter referred to as "the union") brings both of these matters before us alleging that they involve the unlawful closure, sale and removal of a business to escape collective bargaining . The union was certified by the Board to represent certain employees of Sunnylea Foods Limited (hereinafter referred to as "Sunnylea") on April 30, 1980 pursuant to section 7a (now section 8) of the Labour Relations Act. The Board had found that Sunnylea discriminated against six employees in response to protected activity under the statute. The Board also found that threats to close the plant if the trade union was successful were made by the respondent company and that this conduct was also unlawful. The certificate issued to the complainant! applicant reads:

Upon the application of the applicant and in accordance with the provisions of The Labour Relations Act, THIS BOARD DOTH CERTIFY United Food and Commercial Workers International Union as the bargaining agent of all employees of Sunnylea Foods Limited in the City of Grimsby, save and except forepersons and persons above the rank of foreperson, office staff, sales staff, students employed during holiday and vacation periods and persons regularly employed for not more than 24 hours per week.

This certificate is to be read subject to the terms of the Board's decision(s) in this matter and, accordingly, the bargaining unit described herein is to be read subject to any qualifications referred to in the said decision(s) of the Board.

It is also to be noted that by decision dated June 19, 1980 the Board reinstated another employee who the Board found was discharged for her union activity. Sunnylea, until October 22, 1980 was in the egg grading business. It purchased eggs from producers; graded them by a process which included washing, candling and packing; and sold them to customers, many of whom were chain stores. Jacob Zonneveld is the owner and principal officer of Sunnylea. He also owns an egg producing farm known as Sunnybrae Farms Limited (hereinafter referred to as "Sunnybrae"). One of the unfair labour practices on which the certification was based included the discharge of a key union organizer, Mr. Robert Berton. Mr. Berton was returned to work on or about March 28, 1980 pursuant to a Board order. He was again discharged on May 9,1980 and this action of Sunnylea is also the subject matter of the complaint before us.

2. On or about October 20, 1980 Sunnylea discontinued business. The union alleges that at about the same time a new egg grading plant performing the same work as was performed in Grimsby by Sunnylea was opened in Mississauga under the name of Maple Leaf Egg Products Ltd. (hereinafter referred to as "Maple Leaf"). At approximately the same time another egg grading business in Burlington, Ontario known as Turkstra's Eggs Ltd. (hereinafter referred to as "Turkstra's) discontinued business and the union alleges that the same work as was performed in Burlington is also being performed at the new Mississauga facility. It alleges that several key managerial personnel from both Sunnylea and Turkstra's are now operating Maple Leaf. The union further alleges that Maple Leaf is under the direction and control of Sunnylea and Turkstra's and!or their respective principals or shareholders and that there was a sale of business within the meaning of the Act from Sunnylea plant shutdown was affected in an effort to avoid or evade the collective bargaining obligation to the union and that Maple Leaf and Turkstra's in knowingly assisting this effort also violated the Labour Relations Act. Finally, the union alleges that on or about October 22, 1980 former Sunnylea employees Harvey Crowe, Sandra Rattle, Debbie Henson, Candy Morris, Denise Dochstader and Kathy Travis were denied employment by Maple Leaf because of their previous association with the union.

3. The union seeks the following relief:

(a) a declaration that all respondents have violated the Labour Relations Act;

(b) a cease and desist order from continued unlawful conduct;

(c) damages to all members of the Sunnylea bargaining unit and to the union including organizing, negotiating, legal and other costs thrown away payable with interest as appropriate;

(d) a declaration that the bargaining rights flowing from the April 1980 certificate bind Maple Leaf;

(e) a direction that Maple Leaf offer all members of the Sunnylea bargaining unit their previous jobs or substantially equivalent jobs at the new Mississauga location of Maple Leaf;

(f) a direction that employees who accept the offer set out in paragraph (e) above be further provided with:

(i) terms and conditions of employment in effect at the new location save and except that the hourly pay of these employees will be "red circled" at the previous Sunnylea rate should that be required;

(ii) reimbursement for all reasonable transportation, commuting, or temporary housing costs in connection with their relocation for up to one year from their commencement of work at the Mississauga location;

(iii) reimbursement for all reasonable moving and relocation costs incurred within two years from their commencement of work

at the Mississauga location;

(iv) their seniority date portable from Sunnylea to exceed any new employee hired at Maple Leaf to be applicable to Maple Leaf;

(g) a direction that the respondents compensate all members of the Sunnylea bargaining unit, who do not elect relief pursuant to paragraph (e) above, by way of damages for loss of employment, a sum equivalent to the amount of one year's wages and benefits;

(h) in the alternative to paragraph (d) above, a direction that the respondents for a period of two years provide the union with:

(i) a list of Maple Leaf employees' names, addresses and telephone numbers, such list to be updated monthly;

(ii) reasonable access to the Maple Leaf Mississauga plant to post union notices, bulletins, and other union literature;

(iii) access to the Maple Leaf plant to convene two union meetings during paid working hours on reasonable notice to Maple Leaf;

(iv) reimbursement for all reasonable costs incurred by the union in seeking to organize Maple Leaf for a period of one year from the date the union elects to undertake such activity;

(i) a direction that:

(i) there the Board posting in the usual form at Maple Leaf;

(ii) that the decision of the Board be mailed to every member of the Sunnylea bargaining unit;

j) such other and additional relief as counsel may advise and the Board sees fit to grant.

4. Much of the earlier controversy between the union and Jacob Zonnelved appears to be the product of Zonneveld's religious beliefs. He is a member of the Christian Reform Church in Grimsby and believes that any union he deals with must be "Christ centered." Unfortunately, the union in this case does not qualify. He testified that to be a deacon of his church one cannot be involved in union activity of any kind. Zonneveld was a deacon prior to the presence of the trade union. It would also appear that a number of his employees share his religious convictions with respect to trade unions. Paragraphs 7 and 8 of the union's particulars allege the following:

5. On May 13, 1980 an article appeared in the Globe and Mail reporting the decision of the Board dated April30, 1980 in which the credibility of Mr. Jacob Zonneveld, owner of the respondent, was questioned. There was widespread publicity in the Niagara Region that day. On the same day May 13, Mr. Berton was discharged by the respondent.

6. On May 13, 1980 Mr. Jacob Zonneveld was quoted in the Toronto Star as saying:

"If I spoke my mind about the hearing, I would probably be held in contempt, so I won't. All I can say is that I believe all gifts come from God. As a steward (of God) I have to make sure the gifts are used properly. If there's a union, I figure the union is living off me. Unions are sinful, violent and don't believe in God.'

Zonneveld said that while he 'feels sorry' for his employees, "I've made my decisions. I've an obligation to these people, but now its up to them to make their decision. They know how I feel. I have to be able to look at myself in the mirror in the morning.

In the same article Mr. Herman Turkstra, counsel for the respondent, is quoted as saying that "No-one could force him to stay in business. He could sell, retire or close."

5. Don Dayman, business agent for the union, testified that negotiations with Sunnylea began May 15, 1980 with the company's lawyer, Mr. Ivey, representing Sunnylea. Additional meetings were held on June 20, July 4, July 16, August 1 and August 28. He testified that Mr. Ivey stated that he had been instructed to bargain in good faith; that religion was still a problem; and that Mr. Zonneveld had various options but that he (Ivey) did not know which one he was going to choose. Dayman said it was no secret that Zonneveld would consider selling his business if certified, although Dayman did not think he would go through with it. He testified that on August 27, 1980 he was notified for the first time that the plant was closing and that he learned about the existence of Maple Leaf on the same day. He agreed there was a clear split in support for the trade union within the bargaining unit which had not been "manufactured" by Zonneveld. He further testified that he dealt with the competitors of Sunnylea and that he may have discussed Sunnylea's certification proceedings with one of them.

6. Jacob Zonneveld testified that he had been in business since 1959. Between 1972 and 1974 he purchased up-to-date equipment at $100,000 per machine with a capacity of 68 cases of 12 dozen eggs per hour. Soon after, however, more advanced equipment came onto the market requiring fewer employees and with a greatly expanded capacity of 120 to 130 cases per hour. These new machines cost $250,000 each. The Board was advised that Sunnylea was one of the smaller of the principal egg graders in Ontario. L. H. Gray, Maplelin and Bernbrae were said to be much larger and occupy 50 percent of the Ontario market. With the minimum price of eggs from the farm being regulated by the Egg Marketing Board and with his competitors' prices setting an upper limit on what he could charge customers, Zonneveld said Sunnylea could not alter the financial climate in which it operated. He testified that he looked for financing in 1978 to permit him to acquire the new equipment but was unsuccessful. At the time he was operating in an inadequate building and his vehicles needed to be replaced as well. On the other hand, his competitors, he said have always had money to play with. It was not disputed that on the advice of his accountant and after taking all of these factors into account, he listed his business property and assets for sale on October 16, 1978. The listing agreement prohibited the agents from approaching various competitors so that he would not lose his source of egg supplies. Sunnylea had never had a long term contract with his suppliers and Zonneveld feared that they would sell to others if he appeared to be going out of business. The listing agreement was introduced into evidence and indicated a number of extensions into July of 1979. It was also his undisputed evidence that there was no sign of union interest in his company until October of 1979. During its financial year ending April 30, 1979, Sunnylea experienced a $40,591 after tax profit on $8,633,000 in sales; as of April 30, 1980 it experienced a $43,300 net loss on $ll,913,000 in sales; and from May l980 until June 3l, 1981 it incurred a $43,150 loss on $5,122,000 in gross sales. This financial data went unchallenged by the trade union. It was also accepted that during this period his indebtedness to the Royal Bank in Grimsby was as high as $450,000 and in mid-1980 he was asked by that bank to transfer his business elsewhere — a polite way of indicating that otherwise the loan would be called. Fortunately, in July of 1979 Zonneveld had commenced discussions with Mr. Bruce Buckingham of W. B. Cross Co. Ltd. to consider entering into a new egg grading venture that would combine greater volume with the new, efficient egg grading equipment then available. These discussions were still continuing at the time the Royal Bank requested him to remove his business and Buckingham was instrumental in arranging for his indebtedness (which was then approximately $300,000) to be transferred to the Canadian Imperial Bank of Commerce. Zonneveld testified that had he not met the Cross family and Buckingham he could not have survived. The financial basis to this statement was not disputed by the trade union. Indeed, Zonneveld had clearly been trying to sell his business since 1978 but without success. There was no evidence that these efforts were not serious or that his asking price was unrealistically high. Thus, we must find that Zonneveld had decided to cease operations on the right terms before the arrival of the trade union.

7. Bruce Buckingham is President of W. B. Cross Company Ltd. (hereinafter referred to as "W. B. Cross"), a company with a number of investments in food related businesses. He testified that during 1978 he had discussions with a Mr. Andrew Tuvel who was associated with Sunnylea. Various witnesses described Tuvel as a food broker and as a person with "good connections" to the food chain customers. Zonneveld described him as an employee and his assertion in this regard was not challenged by the union. Buckingham testified that Tuvel initiated these discussions with a view to determining whether W. B. Cross would be interested in investing in an egg grading business. Tuvel had been involved in another business acquired by W. B. Cross in "the early seventy's". In was apparently Tuvel's view that the unsuccessful egg grading operations were essentially too small but that there was considerable profit potential for a large consolidated business. Buckingham recalled Tuvel again "dropping by" in the spring of 1979 and in late June of that year arrangements were made for a visit to Jack Zonneveld's farm the following month. Buckingham said Tuvel expressed the belief that few of the existing egg grading businesses were sufficiently viable to supply the requirements of the chain stores. He was concerned about his welfare and the industry's according to Buckingham. The timing of his concern not unreasonably coincides with Zonneveld's decision to sell his business and again pre-dates the presence of the trade union at Sunnylea. Buckingham testified that before the spring of 1979 he had not heard of Sunnylea or Turkstra's. The July meeting at Sunnylea included William Cross, David Cross, Buckingham, Tuvel, and Sunnylea's accountant and lawyer. By October of 1979 W. B. Cross was sufficiently interested to instruct their solicitors to explore the proper corporate vehicle. At this time the concept, at Tuvel's urging, involved the participation by those involved in the existing egg processing businesses of Metzgler, Whyte, Zonneveld and Turkstra's. A key meeting of all potential participants was held in Toronto in January 1980, but by February Metzgler had apparently decided against participating for personal reasons and Whyte ran into financial problems. Buckingham testified that in July of 1979 no mention was made of unions or labour relations but by February 1980 he was well aware of Zonneveld's problems in this regard. At the time of the Labour Board's decision in late April, Buckingham called Zonneveld for an explanation and testified that following this conversation he was fully aware of Zonneveld's perspective. Zonneveld expressed to him a great deal of concern if the union stayed certified but did not say how the plans with Buckingham would help him. Also in February, Buckingham retained Thorne Riddell to study the possible investment and a report was presented in March of 1980 indicating the need and potential for increased volume with new equipment and plant. Buckingham said that the new venture had to be a consolidated enterprise with more sophisticated and newer equipment. He also said that when they began looking for a new site the best areas seemed to be Grimsby, Burlington, and Milton. The new venture needed a plant with at least 50,000 square feet, at a reasonable price and in the area of a good labour pool. Zonneveld testified that his property was unsuitable for expansion. He was located on top of the escarpment in Grimsby without city water and sewage. His existing operation used 20,000 gallons of water a day and the new business would require up to 50,000 gallons. Moreover, he was unaware of any other land in Grimsby that was suitably serviced. There is no reason not to accept this testimony. Buckingham testified that he instructed real estate agents to search for suitable premises in the Grimsby, Burlington, and Milton areas but no available property in those areas was really suitable. Two real estate agents testified and denied that they were instructed to look for property away from the Grimsby area. They confirmed that many properties were looked at but none were suitable. However, in April 1980 premises in Mississauga on Tomken Road were found and judged to be suitable although apparently over the objections of Zonneveld and Henry Lammers of Turkstra's. The lease for these premises was filed with the Board and dated May 7, 1980. Maple Leaf was incorporated April 30, 1980 as the corporate vehicle to commence operations at this new location. All of the foregoing evidence is in marked contrast to the site selection criteria relied upon by Westinghouse and the lack of immediacy of the impugned move in that case. See Westinghouse Canada Limited, [1980] OLRB Rep. April 577.

8. Maple Leaf, controlled by W. B. Cross but clearly involving Turkstra's, went into possession at the new premises with new machines in September of 1980. However, Zonneveld had "second thoughts" and decided against participating. It was his evidence that he had been an independent businessman too long and could not convince himself to enter into a business venture with others. Buckingham, on the other hand, was extremely concerned about getting both a supply of eggs from Sunnybrae and Zonneveld's co-operation in making contact with the other egg producers of Sunnylea. At apparently the time Zonneveld decided against equity participation, Tuvel decided to become involved in the ownership of Maple Leaf. Whether Tuvel's participation was related to Zonneveld's decision to not participate we do not know, although this appears to be the case. Eventually, the participation became $1,200,000 (15,000 shares) for W. B. Cross; $400,000 (5000 shares) for Henry Lammers of Turkstra's; and $100,000 (1250 shares) for Andy Tuvel to be held by Rexim International Trading Limited. Tuvel did not participate to the degree that it was expected Zonneveld would. Buckingham testified that Maple Leaf was so interested in acquiring Sunnybrae's supply of eggs through Zonneveld and Zonneveld's co-operation, it was decided to buy the assets of Sunnylea and tie this purchase to obtaining its supply of eggs. A number of documents were filed with the Board documenting this commercial transaction. The first was a document dated December 16, 1980 addressed to Sunnylea over the signature of the President of Maple Leaf, Bruce Buckingham. Paragraph one stipulates that Maple Leaf is to purchase the assets of Sunnylea set out in Schedule A to the document for the price therein. The assets included an assortment of small tools and supplies ($2,854); wire baskets ($104,367.44); farm carts ($98,000); plastic tray drier ($3,400); refrigeration ($22,200); and other miscellaneous equipment ($37,753.40); for a grand total of approximately $268,000. This amount was to be paid directly to Sunnylea's bank account and used by the bank to reduce Zonneveld's indebtedness. It was agreed that the purchaser was not purchasing "the business of the vendor as a going concern, but . . . only purchasing certain assets of the vendor." By paragraph three Sunnylea was to deliver a statutory declaration that the vendor has no unsecured creditors other than the Canadian Egg Market Agency and the indemnity of Jacob Zonneveld and Sunnybrae from any claims of creditors made against the assets, the indemnity secured by a mortgage on the egg farm owned by Sunnybrae. By paragraph 5 the vendor warranted that it did not have any employees as of the date of closing. The date of closing was set for December 31, 1980 and the guarantors, Zonneveld and Sunnybrae, agreed to enter into the following agreements. Exhibit 4 is an agreement between Maple Leaf and Jacob Zonneveld (described as vendor) which is expressly in consideration of Maple Leaf purchasing the assets owned by Sunnylea and in consideration of $2.00. Essentially, it consists of the following two covenants:

9. The Vendor covenants and agrees that for a period of five (5) years from the date hereof he will not (except as required by an agreement made as of December 31, 1980 between the Purchaser, the Vendor, Sunnylea and SunnyBrae Farms Limited) either individually or in partnership or in conjunction with any other person or persons, firm, association, syndicate, company or corporation as principal, agent or shareholder or any manner whatsoever, carry on or be engaged in or connected with or interested in, advise, loan money to, guarantee the debts and obligations of or permit his name or any part thereof to be used or employed by any other person or persons, firm, association, syndicate, company or corporation engage in or concerned with or interested in within Ontario, any business similar or identical to the business of grading eggs, carried on by Sunnylea as at August 1, 1980.

10. At any time during the five year period referred to above SunnyBrae Farms Limited may, on three months notice to the Purchaser commence to grade, at SunnyBrae Farms Limited, the eggs produced on that farm, provided that such eggs are then sold to the Purchaser in a graded fashion and further provided that SunnyBrae Farms will not give such notice to you until all four of the Purchaser's present four grading machines are operating at full capacity, and if within 1 year the Purchaser has purchased a fifth machine, then until all five of the Purchasers grading machines are operating at full capacity. Exhibit 5 is an agreement dated December 31, 1980 between Maple Leaf, Jacob Zonneveld, Sunnylea and SunnyBrae. Sunnylea is described as the "vendor". It too is in consideration of Maple Leaf having purchased Sunnylea's assets (and in consideration of $2.00) and commits Zonneveld and Sunnybrae to offer to supply to Maple Leaf all the eggs produced by Sunnybrae. Zonneveld (and Sunnybrae) further agreed to "use his best efforts to continue the supply of eggs to Maple Leaf from suppliers listed in Schedule 1." The suppliers listed were Sunnybrae, B.N.R. Poultry Farms Ltd., W. Currie, J. Oosterhof and I. Piasecki.

11. Buckingham testified that the purchase price for the assets was extremely generous and clearly designed to obtain Zonneveld's supply of eggs and his co-operation in having former egg suppliers of Sunnylea become suppliers of Maple Leaf. He wanted to "keep Zonneveld happy" was the way it was put and guarantee Sunnylea's supply of eggs., Buckingham also acknowledged that Sunnylea's trucks and trailers were used by Maple Leaf for six months until Maple Leaf acquired its own vehicles through McClive Leasing. Indeed, Zonneveld received a better price for his vehicles by having them traded in with McClive on Maple Leaf acquiring new equipment from that company. Zonneveld worked as a consultant to Maple Leaf in November 1980 and, according to Buckingham, provided valuable advice about the operation of the new business. Buckingham also admitted that Maple Leaf hired a number of key management and operating people formerly employed by Sunnylea but denied that it was part of the asset purchase. These people included a cost accountant (Bob Van Kam), Jacob Zonneveld's brother who was involved in the trucking side of Sunnylea's business, a key maintenance man, two or three truck drivers who knew the routes and, of course, Tuvel. Van Kam was hired on the recommendation of Thorne Riddell. Buckingham said that Zonneveld helped Maple Leaf obtain egg supplies from Sunnylea's former suppliers but he thought the "key" here was paying for two weeks supply in advance. This was said to be a unique concept in the industry. The evidence disclosed that Henry Lammers of Turkstra's is in charge of the day-to-day operation of the Maple Leaf business. Buckingham testified that Andy Tuvel "had the chain store accounts not Sunnylea" and that his involvement was instrumental in Maple Leaf obtaining the former customers of Sunnylea. Buckingham testified that Maple Leaf now employs sixty to seventy persons whereas Sunnylea employed approximately forty and Lammers indicated that the business has "a little over" the combined volumes of Sunnylea and Turkstra's businesses. Buckingham admitted that he was well aware of Zonneveld's labour relations difficulties from February 1980 onward. The Board's decision certifying the trade union was dated April30, 1980 and Buckingham executed the offer to lease on May 6, 1980. Buckingham was also aware that Andy Tuvel attended many of the Labour Board certification hearings dealing with Sunnylea. Buckingham testified that Zonneveld never confided to him precisely why he was closing his plant. Buckingham admitted that the supply of eggs is critical to an egg grading business and can be the difference between success and failure. It is clear to the Board that the closing of Sunnylea (and Turkstra's) and the opening of Maple Leaf were closely co-ordinated so that customers and suppliers experienced a smooth transition. Notice of closing was given by Zonneveld in late August; Maple Leaf commenced operations in September; and by October all suppliers and customers were looking to Maple Leaf. Buckingham emphasized that one of the unique features of Maple Leaf is its close proximity to its customers whereas its competitors are close to the producers. Just how this unique feature results in an economic advantage was not explained to the Board .but Buckingham was not cross-examined on the statement.

12. Since 1975 Henry Lammers had been the sole owner of Turkstra's located in Burlington, Ontario. Turkstra's employed thirty-five to forty employees. He testified that in 1978 Zonneveld indicated to him that he wanted to get out of the egg grading business and asked him if he was interested in acquiring Sunnylea. Tuvel was apparently instrumental in bringing the two men together and Turkstra was interested in Tuvel continuing on in his capacity as food broker if Sunnylea was acquired. These discussions eventually came to involve W. B. Cross. Again, it is important to point out that Turkstra's involvement pre-dated the presence of the trade union at Sunnylea. Lammers testified that he advised his staff in Burlington that he was closing and gave them the required notice on September 2, 1980. He said that he offered employment to former employees of Turkstra's who lived in Burlington or north-east of Burlington but not to people "who lived too far away." He admitted that he was present at Maple Leaf on October 22, 1980 when former Sunnylea employees, Harvey Crowe, Sandra Rattle, Debbie Benson, Candy Morris, Denise Dochstrader and Kathy Travis attended the premises and applied for work. He believed that other persons also sought employment on that day. He agreed that Andy Tuvel came into his office at the same time and advised him that the former Sunnylea employees had been witnesses or were present at the earlier Labour Board hearings. Lammers testified that I gathered they were "pro union Because they had driven all the way from Vineland, he paid them the courtesy of speaking with Harvey Crowe. He told Crowe the distance was too great for these people to commute on a daily basis and that, in any event, he was not hiring. The Board was advised that the Maple Leaf plant is approximately an hour and a quarter drive from the Grimsby area and that no public transportation connects the two locations. Lammers testified that he didn't feel experience was necessary in an egg processing plant and that he had told several former Sunnylea employees who called him that the commuting distance was too great. Hiring refusals were said to include a Ms. Vandervelde who was described by Jack Zonneveld as"an excellent quality control girl" and who apparently was against the union. However, Maple Leaf did hire some people from the Grimsby area including Gerry Blokker, Frank Dykstra, Frank and Rick Zwaagstra's were drivers and, according to Lammers, their earning were sufficient to support the required commuting. Moreover, their routes included the area in which they lived. The financial rationale also applied to Leen Zonneveld who was in charge of shipping. Lammers denied that he was aware of when Sunnylea would close or that the closings of Turkstra's and Sunnylea were co-ordinated. On the facts, this statement cannot be accepted. He also denied that the closings included the transfer of staff. All of Maple Leaf's hirings were on an individual basis he said. Lammers denied that Maple Leaf received routing maps from Sunnylea and stated that Maple Leafs routes were planned with the assistance of the drivers.

13. Lammers denied that Maple Leaf purchased any of Sunnylea's suppliers. Lammers stated that suppliers are seldom under contract and are "free agents". He pointed out at least nine former producers or suppliers who do not supply Maple Leaf anymore. Lammers was extensively cross-examined on lists of producers and customers for Sunnylea, Turkstra's and Maple Leaf. At the conclusion of this testimony it was clear that the vast majority of former producers and customers of Sunnylea and Turkstra's are now the producers and customers of Maple Leaf. In addition, the drivers of Maple Leaf, a number of whom were Sunnylea drivers, follow the same routes used by Sunnylea. Lammers said that the continuation of customers and producers was only possible through a lot of hard work by Maple Leaf staff. Both he and Mr. Von Zieidenberg, a former Sunnylea employee, approached producers; offered them the two week pre-payment program; and sought their support. He made no mention of the efforts by Zonneveld and Buckingham. Cross-examination also revealed that a significant number of the senior operational staff (approximately 50%) are or were former Sunnylea employees. Mr. Beamer, a helper on the trucks, was also revealed as another exception to the commuting distance hiring policy.

14. Lammers admitted recalling some newspaper articles in the summer about the possibility of Zonneveld closing his plant. Lammers agreed there was a lot of discussion in the Niagara Peninsula area about Zonneveld's problems with the trade union and that he became aware in January of 1980 that Zonneveld was thinking about closing his plant. Indeed, as their discussions about forming a new business progressed, the closing of Zonneveld's business in Grimsby became obvious. Lammers said he was aware at a very early point that a union was trying to organize Sunnylea and Tuvel made him aware of the Labour Board proceedings. Lammers denied that Zonneveld told him what he was going to do about his trade union problems but he admitted Zonneveld said he was anxious to join the new venture because of his religious problems with the union. Lammers could not recall being told by Zonneveld that he was prepared to close his plant because of his religious beliefs. Lammers testified that in refusing to hire former Sunnylea employees he was only concerned about the commuting distance and the problem of labour turnover. On the other hand, he admitted that a number of his senior staff are making this trip each day, although, insisted it was more economical for them. Surprisingly, he then stated that he was not hiring that day and that had they come back he probably would have hired them. But they never returned and Lammers made no effort to contact them even though they had each filled out applications for employment. He agreed it crossed his mind whether the people he was hiring were sympathetic to the union but that such thoughts did not enter into his hiring decisions. He agreed that store deliveries to Sunnylea's former customers began by Maple Leaf immediately after Sunnylea closed and that Tuvel made all the arrangements.

15. Zonneveld testified that Robert Berton was reinstated by the Labour Board on March 13, 1980. Berton had injured his arm and, accordingly, when he returned to work Zonneveld decided it was inappropriate to return him to his position as driver. He was therefore put in the cooler where eggs graded and packed. This required the continual lifting of twenty-five pound packages of eggs onto pallets — approximately the same weight he had to lift as a driver. Zonneveld testified that other employees complained that Berton was not "pulling his weight" although no employee was called to support this assertion. It is also quite clear that the job in the cooler involved much more lifting than did Berton's job as a truck driver. Zonneveld testified that he believed one needed two arms to drive a 30 ton truck safely down the escarpment. Berton was dismissed on May 13, 1980 but returned to his job as driver on June 26, 1980 as the result of a "without prejudice" settlement with the union. According to Zonneveld, he received a number of complaints from customers about Berton's rudeness and the employee was alleged to have damaged his truck. These allegations were not substantiated and Berton apparently quit his employment on September 22, 1980. Zonneveld denied that Berton's dismissal on May 13, 1980 had anything to do with his union activity although Zonneveld believed that Berton brought the trade union into the plant and disliked him immensely for this action.

16. The interrelationship between the closing of Sunnylea and Zonneveld's admitted hostility to the union is a key issue in this case. We reviewed above Zonneveld's economic predicament and the way in which Buckingham assisted him in his problem with the Royal Bank. Zonneveld also testified that the trade union's presence forced him to consider his alternatives. He could close-up or look for an amalgamation. He said he spoke about his convictions to Leen Zonneveld and Hennie Vandervelde and, when it was clear the union was coming in, indicated that he had no choice but to "sell, quit or close-up." His brother apparently repeated this to the employees in the plant. He admitted that he spoke to a Toronto Star reporter in early May of 1980 but denied using the precise expressions found in that report. He said that with the union he found "absolutely no joy in working anymore." However, he had decided to close his business and approached his relations with the union as a "grin and bear it one." He knew the plant would be closed in a few months and said the union had nothing to do with the plant closing — "the decision to close was really made in 1978." Zonneveld said he stayed open for two weeks beyond what was legally required so employees could find jobs and paid them an extra week's wages. He also advised employees to seek employment with Metzgler and with Turkstra's new business. He denied that certain employees who were against the union were retained for an extra week. Rather, he asked for volunteers to help with the plant clean up that week and no one came forward. He was therefore obligated to select employees by seniority and their proximity to the plant. He could not see how this "hard work" was a reward of any kind. He denied closing his plant to avoid collective bargaining. He said if his company had been profitable he "would have fought the union for twelve months until the employees were no longer interested which [was his] right as a Canadian citizen. And if that didn't work [he] would have sold the business." On cross-examination he admitted that Sunnylea agreed to stay open until Maple Leaf was prepared to handle the product. He said that his customers had been cultivated over his many years in the business and Tuvel handled the problems with the chain stores and was paid a certain amount for their patronage and any expanding business. There was no cross-examination of Tuvel's precise role in the Sunnylea business. The only producers Sunnylea had under contract or control were Sunnybrae, B.N.R. Poultry Farms, W. Currie and V. Oosterhof named in Schedule A to the December 16, 1980 agreement. However, Zonneveld also asked Niagara Grain "to keep the eggs coming" and he went to all of his producers with Buckingham; explained the pre-payment program; and asked them to sell to the new company. He played a role in advising Maple Leaf on the purchase of new equipment. He described Boy Van Kam as "his right-hand man" and said that only Joe Polo knew the machinery. Van Seidenberg, a member of the Christian Reform Church, was also described as a key employee. He testified that he asked for the right to grade eggs on his farm only to make the farm more valuable. He thought it was impossible for him to get back into business. He said that it was not possible to tell the union of his plan to close his plant because its representatives might have told his competitors as they had discussed the events surrounding the certification proceedings. His competitors would then have approached his producers and this "would have broken" him. He said the only reason he was able to continue for a few months after his bank asked him to change his business was because of the assurances given by Buckingham to the Canadian Imperial Bank of Commerce and the fact that Maple Leaf was not ready to take over yet. At the last minute he decided against joining Maple Leaf because "emotionally [he] could not accept [he] was no longer calling the shots."

17. Zonneveld said he would have told Lammers about the union "the minute those problems surfaced." He testified that he is sure he told Lammers and Buckingham what he felt and thought. He was sure he discussed the situation with them in December 1979 and January 1980 and that he told them what he would do if he had to sign a collective agreement. He said he felt so strongly about it he could not see how he would have left it out. He said they also discussed whether his union problems would create problems for Maple Leaf but he testified that "Buckingham is not the kind of guy to worry about a problem that is not there." Zonneveld said he told Buckingham and Lammers that if the union got in at Maple Leaf he would have to leave and Buckingham replied that "we will solve that problem when it surfaces in the plant." He said Lammers and Tuvel "took their lead from Buckingham." As for Berton, Zonneveld said he second-guessed Berton's doctor and concluded he could not drive safely. He admitted that he never questioned Berton about the use of his arm or asked to speak to his doctor.

Argument

16. On behalf of Maple Leaf it was submitted that Sunnylea had only sold some of its assets to Maple Leaf. Counsel submitted that the Board should make a distinction between the egg grading business of Sunnylea and the egg farm owned by Sunnybrae. Maple Leaf bought the assets of Sunnylea to ensure a supply of eggs from Sunnybrae. The business of Sunnylea was in a losing position and, it was submitted, that the restrictive covenant obtained by Maple Leaf was just "icing on the cake." The purchaser would have closed the deal without it. Counsel pointed out that the former employees of Sunnylea now working for Maple Leaf were not employed by Sunnylea at the executive level. Counsel also emphasized that Sunnylea was "living on borrowed time" as a further indication that Maple Leaf only bought its assets. Alternatively, it was submitted that a successor employer cannot be "visited with the sins" of the predecessor employer unless the successor was involved in a scheme to circumvent the Act. Counsel reviewed the evidence in detail and submitted that there was not a scintilla of evidence suggesting Maple Leaf was part of such a scheme. It was pointed out that Jacob Zonneveld was not involved in Maple Leaf in any way; he was not part of the executive group; the customers were said to be those of Andrew Tuvel; there was no plan to locate away from Grimsby; and business discussions had commenced as early as 1978. Counsel reviewed Maple Leafs hiring decisions asserting that all had a bona fides business purpose. He submitted that Maple Leafs decision to locate in Mississauga was free of anti-union animus and that, even if a sale had taken place, the bargaining rights of the complainant did not extend to the new location. Counsel emphasized that if Maple Leaf violated the Act in failing to hire former Sunnylea employees who applied for work, this isolated violation could not be justification for bestowing bargaining rights on the trade union.

17. On behalf of Jacob Zonneveld and Sunnylea, counsel challenged the union's delay in bringing these matters on and asserted that his clients had been prejudiced. Counsel submitted that it would have been irresponsible to put Berton on the road. He contended that Sunnylea was "dead" before it closed and that the presence of the union was essentially irrelevant to the demise of Sunnylea. Counsel warned that the Labour Board is not in the business of punishing people for what they believe and that much of what Zonneveld testified to were matters of belief not action. It was submitted that a person had a right to cease doing business and that Sunnylea could not be forced to stay in business. Counsel contended that the Act was violated only when protected activity was the proximate cause of an employer's action and such was not established in the instant matter. It was also contended that Jacob Zonneveld always acted in his capacity as an officer of Sunnylea and should not be named as a respondent in his personal capacity.

18. On behalf of the union it was submitted that : (a) Maple Leaf is the successor to Sunnylea; (b) the closing and sale of Sunnylea was the subject of an unlawful motive; (c) Maple Leaf purchased Sunnylea in the full knowledge of Zonneveld's unlawful motive and was therefore a proper respondent to a remedial order; (d) alternatively, Maple Leaf is responsible for remedying the breach of the Act in any event. In asserting that the sale of a business had occurred, counsel pointed out that Maple Leaf had the same producers and customers as Sunnylea; serviced each by the same routes with the same drivers; and Maple Leaf was operated by a significant number of Sunnylea's senior employees. Counsel emphasized that Zonneveid was paid a great deal of money for assets that Maple Leaf did not really need; that Zonneveld provided important know-how to Maple Leaf; that Zonneveld played a key role in transferring Sunnylea's supply of eggs to Maple Leaf; and that, by virtue of his agreement with Maple Leaf, Zonneveld was prohibited from going back into business for a period of time. Counsel contended that it was simply too technical to draw distinctions between Sunnylea, Sunnybrae and Andrew Tuvel's relationship with Sunnylea's customers. It was submitted that Sunnylea's unlawful motivation could be deduced from its earlier actions documented before this Board; from its subsequent treatment of Berton; from the evidence of Zonneveld before this panel and his earlier statements that he would close his business; from Sunnylea's conduct in bargaining; and from the timing of Sunnylea's actions. Counsel submitted that Maple Leaf was fully familiar with Jacob Zonneveld's labour problems and had to appreciate that the sale and closing of his business was intended to thwart collective bargaining. It was submitted that in the light of this knowledge Maple Leaf became party to an unlawful act and was properly the target of a remedial order. It was also submitted that, in any event, a successor employer was properly obligated to remedy the statutory violation of a successor employer. In this latter respect the Board was referred to Golden State Bottling Co. Inc. (1973) CCH, ¶ 14,124 (USSC): Uncle Ben's, [1979] 2 Can. LRBR 126; and Victoria Flying Services, [1979] 3 Can. LRBR 216.

Decision

19. Counsel for the union, at the outset of his argument, withdrew his application under section 1(4) of the Labour Relations Act for a declaration that Sunnylea, Turkstra's and Maple Leaf constitute one employer for the purposes of the Labour Relations Act and that the certificate granted to the union on April 30, 1980 binds all three companies. Thus, as noted in paragraph 1, we have before us an application pursuant to section 63 for a declaration that Maple Leaf is a successor employer to Sunnylea and a declaration that the bargaining rights flowing from the April 1980 certificate bind Maple Leaf. We also have before us a complaint filed under section 89 of the Act alleging violations of section 64, 66 and 70. The complaint attacks the closing of Sunnylea and the opening of Maple Leaf as an unfair labour practice designed to evade the bargaining rights of the trade union and substantial relief against all four respondents is requested. The refusal by Maple Leaf to hire certain former Sunnylca employees is also in issue.

20. Beginning with the section 63 issue first, the relevant section is section 63(3) which provides:

63(3) Where an employer on behalf of whose employees a trade union or council of trade unions, as the case may be, has been certified as bargaining agent or has given or is entitled to give notice under section 14 or 53, sells his business, the trade union, or council of trade unions continues, until the Board otherwise declares, to be the bargaining agent for the employees of the person to whom the business was sold in the like bargaining unit in that business, and the trade union or council of trade unions is entitled to give to the person to whom the business was sold a written notice of its desire to bargain with a view to making a collective agreement or the renewal, with or without modifications, of the agreement then in operation and such notice has the same effect as a notice under section 14 or 53, as the case requires.

The matters for determination under this section are (1) whether Sunnylea sold its business to Maple Leaf; and, if so, (2) whether any employees remain in "the like bargaining unit in that business" for the trade union to represent. In Raymond Cots, [1968] OLRB Rep. Mar. 1211 the Board commented:

"The meaning to be attached to the word 'business' depends to a great extent on the facts and circumstances in each particular case. It cannot be said that any one facet of an enterprise taken by itself necessarily comprises a business. It has been expressed that a business is 'the totality of the undertaking.' The physical assets of buildings, tools and equipment used in a business are not necessarily the undertaking per se but are, along with management and operating personnel and their skills, necessary in the operations to fulfill the obligations undertaken with a hope of producing profit to assume its success. The total of these things along with certain intangibles such as goodwill constitute a business.

21. It was contended that Maple Leaf only brought the assets of Sunnylea and that section 63 therefore had no application. Indeed, the document of December 1980 at paragraph 2 specifically states this to be the case. But this document, by paragraphs 7 and 8, is conditional on Jacob Zonneveld executing other agreements and on Sunnylea and Sunnybrae agreeing to enter into other agreements. This Board is concerned with the substance of a transaction as opposed to its form. See Metropolitan Parking Inc., [1979] OLRB Rep. Dec. 1193 at 1205. As noted by Widjery, J., in Kenmir v. Frizzell et al, [1968] 1 All E.R. 414 at p. 418:

"In deciding whether a transaction amounted to the transfer of a business regard must be had to its substance rather than its form, and consideration must be given to the whole of the circumstances, weighing the factors which point in one direction against those which point in another. In the end, the vital consideration is whether the effect of the transaction was to put the transferee in possession of a going concern, the activities of which he would carry on without interruption. Many factors may be relevant to this decision though few will be conclusive in themselves. Thus, if the new employer carries on business in the same manner as before, this will point to the existence of a transfer, but the converse is not necessarily true, because a transfer may be complete even though the transferee does not choose to avail himself of all the rights which he acquires thereunder. Similarly, an express assignment of goodwill is strong evidence of a transfer of the business, but the absence of such an assignment is not conclusive if the transferee has effectively deprived himself of the power to compete. The absence of an assignment of premises, stock-in-trade or outstanding contracts will likewise not be conclusive, ~f the particular circumstances of the transferee nevertheless enable him to carry on substantially the same business as before."

[Emphasis added]

There is the evidence of Bruce Buckingham that Sunnylea's assets were purchased to obtain Sunnybrae's supply of eggs and Zonneveld's co-operation in continuing the supply of eggs from Sunnylea's other producers. According to Buckingham, Lammers and Zonneveld, the supply of eggs is the central most important feature of an egg grading business and Zonneveld had built up Sunnylea's supply over twenty years in business. To a very real extent, the supply of eggs is an egg grading business and its goodwill is the capacity of the business to maintain this supply on transfer. The evidence reveals that Zonneveld played a key role in effecting an almost total transfer of egg supply from Synnylea to Maple Leaf. The other documents signed by Zonneveld on behalf of Sunnylea and Sunnybrae tend to confirm the transfer of a business. These two documents dated December 31, 1980 are both tied into the so-called asset transfer and, in our view, the three documents introduced into evidence document a single transaction. Zonneveld and Sunnylea promised to "use [their] best efforts to continue the supply of eggs" from key suppliers and that Sunnybrae will supply eggs to Maple Leaf and transfer that obligation to any purchaser. We are satisfied that a transfer of egg supply in this industry, particularly where this is explicitly tied to the purchase of assets, is a key indicator of a sale of a business within the meaning of the Labour Relations Act. In our view, a clear indication of transactional intent is also revealed by the restrictive covenant precluding Zonneveld and Sunnylea from going back into business for a fixed period of time. Having bought what it. understood to be Zonneveld's business, Maple Leaf was not about to let him immediately return to the industry and let his goodwill take its toll. On these facts alone we would have found the sale of a business.

22. These facts, of course, do not stand alone. There is the additional evidence that Zonneveld transferred significant managerial know-how in a document prepared in November 1980. According to Bruce Buckingham he gave important managerial advice to Maple Leaf. Sunnylea's closing was clearly co-ordinated with the opening of Maple Leaf to effect an orderly transfer of business from Sunnylea to Maple Leaf. Also of significance is the almost total transfer of customers from Sunnylea to Maple Leaf. It was submitted that the customers were those of Andrew Tuvel. However, Mr. Tuvel was not called as a witness before this Board to expose himself to questioning about his relationship with Sunnylea. Had he so testified it may well have been our view that both he and Jacob Zonneveld controlled Sunnylea in fact although the union never took this position before us or argued the case on this basis. In any event, without direct testimony from him we are unwilling to give him a status separate from Sunnylea. The trade union accepted that Tuvel was only a key employee of Sunnylea and relied on the transfer of customers as another indication of the transfer of Sunnylea's business. We also have the direct testimony of Jacob Zonneveld that he considered the customers to be his customers and that efficient service to them was vitally important. Not only were all of Sunnylea's customers maintained but so were the route schedules linking producers and customers to Sunnylea. In the peculiar circumstances of this case and in this industry, we are unwilling to view the emergence of Maple Leaf as simply the product of a number of independent commercial and hiring transactions. It is our opinion and finding that Maple Leaf represents an amalgamation of the Sunnylea and Turkstra's businesses. The co­operation of Jacob Zonneveld and Sunnylea were vital to the establishment of Maple Leaf and such co-operation, coupled with a restrictive covenant, far outweighed the importance of buying the physical assets that were purchased. We therefore find that Sunnylea sold its business to Maple Leaf within the meaning of the Labour Relations Act.

23. This brings us to the issue of "the like bargaining unit." Section 63 protects existing bargaining rights. Nowhere does the statute extend bargaining rights outside the geographical parameters of the certificate issued by the Board. See Mountain View Dairy Ltd., [1967] OLRB Rep. Feb. 911. In the instant case, the trade union's bargaining rights were described in the following terms:

Having regard to the agreement of the parties, the Board finds all employees of the respondent in the City of Grimsby save and except forepersons and persons above the rank of foreperson, office staff, sales staff, students employed during holiday and vacation periods and persons regularly employed for not more than 24 hours per week, constitute a unit of employees of the respondent appropriate for collective bargaining.

It is clear, on the evidence, that this bargaining unit no longer exists. Maple Leaf is located at 5434 Tomken Road in the City of Mississauga. Had Sunnylea moved its own business to Mississauga for reasons free of anti-union animus, the bargaining rights of the trade union would not have followed the business. Such rights do not fix on the business wherever it is located but take their scope from the wording of the certificate issued by the Board and their purpose from the local labour market. See for example Inglis Limited, [1977] OLRB Rep. Mar. 128. The Board has said that this result ought to be no different simply because a transfer also includes a sale. See Mountain View Dairy, supra, at para. 4. In this regard the Board in the recent Silverwood Dairies case, [1980] OlRB Rep. Oct. 1526 observed:

Accordingly, the Board's jurisprudence demonstrates that the Board has consistently interpreted section 55 in such manner as to preserve but not extend existing bargaining rights. Although most of the reported cases involve movement by the successor employer of the purchased business, Canadian Trailmobile, supra, demonstrates that similar principles are applicable to movement by the successor employer of its original business following the purchase of another business. A trade union with bargaining rights limited by geographic location for the original business of the successor employer ought not to be in any better position if the business is moved away from that geographic location in order to amalgamate it with a business purchased in another location, than it would be in if that business had merely been moved to the new location without any such amalgamation. Accordingly, in such circumstances the Board must consider the scope of the bargaining rights contained in the Collective Agreement for the original business in order to determine whether the new location is within that scope. If it is, then an intermingling at that location of employees of the original business with employees of the purchased business can be dealt with by the Board under section 55(6).

However, if a business is intentionally moved to escape the ambit of the certificate a remedy under section 89 may be fashioned to include a declaration that the affected trade union s bargaining rights flow to and bind the employer in the new location. See Humpty Dumpty Foods Limited, [1977] OLRB Rep. July 401. Thus the trade union's request for a declaration under section 63 that its bargaining rights bind Maple Leaf cannot be granted under section 63 and the application is dismissed. The extension of its bargaining rights to the Tomken Road location can only arise as a remedial response to the established allegations in its complaint filed under section 89. We therefore turn to this complaint.

24. The union alleges that the Sunnylea plant shutdown was designed to avoid and evade the collective bargaining obligation to the union and that Maple Leaf and Turkstra's, in knowingly assisting this effort, thereby violated the Labour Relations Act. The evidence reveals that discussions about the possible amalgamation of several existing egg grading businesses pre-existed the trade union's presence at the Sunnylea plant by several months. Indeed, Bruce Buckingham was approached by Andrew Tuvel as early as 1978 (as was Lammers), a fact supported by Zonneveld's interest in selling his Sunnylea property about the same time. Buckingham said Tuvel was concerned about his future and that of the industry's. There is also unrebutted evidence that the Grimsby location of Sunnylea was not suitable for expansion. The building was too small and located on top of the escarpment. Nor was the land suitably serviced. There is an absence of evidence that the real estate agents were instructed to avoid Grimsby in their searches. There is also direct and uncontested evidence that no suitable location existed in Grimsby. Given the expanded requirements of Maple Leaf, this fact is not improbable. A study was conducted by Thorne Riddell supporting the viability of an egg grading business with expanded volume and new efficient equipment. The evidence suggests that at all times Bruce Buckingham, as the moving force behind Maple Leaf, took the position that Jacob Zonneveld's problems with the trade union would be "dealt with" if and when they arose. The employees of Turkstra's were not represented by a trade union and that business was located in Burlington. The fact that Henry Lammers was willing to close his plant at that location and participate in transferring his business to the new location in the City of Mississauga supports Maple Leafs assertion that the transfer of the two businesses was for bona fides business reasons and free of anti-union animus. The co-ordination of the closing of Sunnylea and the opening of Maple Leaf is also supportable on sound economic grounds and does not evidence an anti-union scheme. In fact, the planning supports the complainant's contention that a sale of a business had occurred. Accordingly, we cannot find that Maple Leaf and Turkstra's were part of a conspiracy to evade the collective bargaining responsibilities of Sunnylea and by such participation violated the Labour Relations Act. Of importance here is the fact that Jacob Zonneveld does not control or participate in the control of Maple Leaf. Had that been the case and were we satisfied that Zonnevel~d's motivation in participating in Maple Leaf was to evade the bargaining rights of the trade union, many of the remedies requested by the trade union could well flow to Maple Leaf notwithstanding the otherwise innocent involvement of Buckingham, Lammers and Tuvel. We also point out that our holding in this respect assumes Tuvel to have been no more than a key employee of Sunnylea. Had Tuvel been found to be a principal our conclusion in this paragraph could have been different. We also note that if Zonneveld does become involved in the Maple Leaf business following the issuance of this decision, it is conceivable that the trade union might wish to seek a reconsideration of the findings herein. Whether such an application would be successful would obviously depend on the facts as they then exist. Beyond this, nothing more can be said.

25. Counsel for the trade union submitted that Zonneveld clearly went out of business by way of a sale for anti-union reasons and that knowledge of these reasons by the officers of Maple Leaf and Turkstra' s is in itself sufficient to constitute a violation of the Act or, alternatively, sufficient to permit this Board to run a remedy against Maple Leaf for the unfair labour practices of Zonneveld and Sunnylea. There are a number of problems with this argument. First, we have already concluded that Maple Leaf and Turkstra's were not part of a conspiracy to defeat the union's rights under the Act and that Maple Leaf, while having bought Sunnylea's business, is not subject to the trade union's bargaining rights due to the bona fides relocation of the business in the City of Mississauga. We cannot see how knowledge of Zonneveld's motive can achieve the result the trade union proposes. No authority having the facts of this case was cited to support the union's submissions and with a key fact being the relocation of the business so that a like bargaining unit and the trade union's bargaining rights no longer exist. Secondly, there is considerable difficulty in finding, as a matter of law, that a successor can be primarily responsbile for unfair labour practices committed by a predecessor employer. Sections 63(2) and (3) of the Labour Relations Act provide:

63.-(2) Where an employer who is bound by or is a party to a collective agreement with a trade union or council of trade unions sells his business, the person to whom the business has been sold is, until the Board otherwise declares, bound by the collective agreement as he had been a party thereto and, where an employer sells his business while an application for certification or termination of bargaining rights to which he is a party is before the Board, the person to whom the business has been sold is, until the Board otherwise declares, the employer for the purposes of the application as if he were named as the employer in the application.

(3) Where an employer on behalf of whose employees a trade union or council of trade unions, as the case may be, has been certified as bargaining agent or has given or is entitled to give notice under section 14 or 53, sells his business, the trade union, or council of trade unions continues, until the Board otherwise declares, to be the bargaining agent for the employees of the person to whom the business was sold in the like bargaining unit in that business, and the trade union or council of trade unions is entitled to give to the person to whom the business was sold a written notice of its desire to bargain with a view to making a collective agreement then in operation and such notice has the same effort as a notice under section 14 or 53, as the case requires.

26. With respect to section 63(2) it has been held that a successor employer is properly subjected to grievances relating to the conduct of a predecessor employer and this appears to be so whether or not the successor has actual notice of the collective agreement and whether or not the grievances were pending arbitration as the date of the sale. See Man of Aran (1974) 1974 CanLII 2278 (ON LA), 6 L.A.C. (2d) 238 (Shime). But this conclusion is heavily dependent on the wording of section 63(2). In Woodbridge Hotel and International Beverage Dispensers and Bartenders' Union, Local 280 (1976), 1976 CanLII 2221 (ON LA), 13 L.A.C. (2d) 96 (Brown) a business was sold after the negotiation of a collective agreement and a dispute arose over the successor employer's obligation to pay retroactive wage and cost of living increases for the period preceding the sale. In holding that the new employer was so obligated, the Board of arbitration held:

These are the terms which the previous owners agreed to be bound by, and those terms are retroactive in effect, so that the successor employer under the Act, is bound in the same manner as if he had been a party. The grievance is therefore properly filed under the terms of the collective agreement, and the union is entitled to assert its claim, which is deemed to be in effect for the purposes of the new owners on March 26, 1975. Those terms apply retroactively and quite independently of any other commercial law application. The successor owners are deemed to be aware of their requirements under the Labour Relations Act which specifically specify their obligations.

As the sale of the hotel fell within the definition of s. 55 of the Labour Relations Act, the present owners are bound as parties of the collective agreement entered into on April 30, 1975, which provides for retroactive payments, in schedule C(2) and schedule G — cost-of-living allowance. In that schedule it is provided:

The parties agree that for the purposes of this agreement, the consumer's price index for the month of October, 1974, shall be the current index. Commencing with the month of Affril, 1975, and each six months thereafter during the life of this agreement a cost-of-living adjustment equal to l~ per hour for each 50-100 of a point. (.50) rise over and above as point rise in a corresponding six months shall be made for all hours worked by an employee during those previous six months.

The collective agreement entered into on April 30, 1975, provides in art. 18 thereof: "This agreement shall be in effect from the first day of November, 1974 and shall continue in effect until the thirty-first day of October, 1976 .. .". There is therefore no question of retroactive effect for the purposes of the parties to that collective agreement, which includes the present owners. The indicated lack of knowledge of a successor employer has been dealt with in the previous arbitration award of Mr. Shime in Re Man of Aran Ltd. and Int'l Beverage Dispensers' and Bartenders' Union, Local 280 (1974), 1974 CanLII 2278 (ON LA), 6 L.A.C. (2d) 238, at p. 240-1, where the board stated:

The lack of knowledge of the existence of the collective agreement is not by itself a defence to the discharge of the employees. The purchaser of a business is under some obligation to ascertain all the outstanding obligations when it purchases the business. Indeed, it is not uncommon that covenants in that regard are obtained when a business is sold.

This is similar to the situation before us that when the business was sold, the new owners are deemed to be bound by the collective agreement in existence at that time under s. 55 of the Act, unless the board otherwise declares, which it has not.

In Kelly Douglas and Company Limited, [1974] 1 Can. LRBR 77 the B.C. Board commented:

It is up to the prospective purchaser to investigate the terms of the bargain which its predecessor has made with the trade union and see that this is taken account of in the purchase price of the takeover before it steps into the shoes of the old employer. (p. 82)

27. The Ontario High Court has approved this approach. In Re United Brotherhood of Carpenters & Joiners of America, Local 3054 and Cassin-Remco Ltd. et al (1980), 1979 CanLII 2013 (ON HCJ), 105 D.L.R. (3d) 138 it was held that an arbitration award and writs of execution issued against a predecessor employer were enforceable against a successor. In making this ruling and after reproducing section 55(2) (as it then was) Mr. Justice Steele wrote:

This is a statement of law and is applicable to a purchaser of a business whether or not he has notice of a collective agreement. I am, therefore, of the opinion that neither prejudice nor the doctrine of innocent purchaser have any application.

For the reasons that I will give, I need not and should not comment upon the Board's decision of January 8, 1979, with respect to prematurity.

The respondents submitted that in interpreting the object of s. 55 of the Labour Relations Act, consideration must be given to the provisions of the Creditors' Relief Act, R.S.O. 1970, c. 97, s. 3, and to the Execution Act, R.S.O. 1970, c. 152, s. 3. The following is s. 3 of the Creditors' Relief

Act:

3. Subject to this Act, there is no priority among creditors by execution from the Supreme Court or from a county court.

The provisions of ss. 2 and 3 of the Execution Act relate to certain exempt chattels and the disposition thereof.

Basically, the argument was that there cannot be any priority among creditors by execution and that where the Legislature intended chattels or items to be exempt from seizure or execution then they have said so, and that by implication the provisions of s. 55 of the Labour Relations Act having made no such provision, and the Execution Act having made no such provision, no priority be given to the execution held by a labour union.

While there is merit in this argument, lam of the opinion that Rule 546 [am. 0. Reg. 32/78, s. 4] relates to the party liable to execution and not priorities among execution creditors. Cassin-Remco Limited was originally the party liable as one of the signatories to the collective agreement. The provisions of s. 55 of the Labour Relations Act make it clear that the person to whom the business has been sold is bound by the collective agreement as if he had been a party thereto. By reason of the decision of the Board, I am of the opinion that Assaf and Fashion Craft are parties liable to execution under the provisions of Rule 546.

One of the principal arguments advanced by the respondents was that the award of the arbitrators resulting in the execution took place after the receiver had gone into possession and that the receiver had priority over this execution and that once the assets had been sold by the receiver under the terms of the debenture, that the purchaser took clear of all executions. It was submitted that to hold otherwise would place the union s execution in a different situation than all the other execution in a different situation than all the other executions outstanding against Cassin-Remco's assets.

While there may be an interesting argument on the issue of whether the collective agreement having been signed prior to the debenture being executed that it had priority over the debenture, or that the debenture was executed prior to the grievance having been filed, or that the grievance was filed before there was a default under the debenture, I think that the issue of priorities is immaterial. lam of the opinion that the Labour Relations Act creates a special status for collective agreements outside the purview of the general law.

Section 55 of the Labour Relations Act provides that the purchaser of a business shall be deemed to be the original signatory to the collective agreement. Therefore, both the union and the purchaser are bound by the terms of the agreement including its benefits and detriments. A benefit may be wage rates differing from those prevailing in the industry. A detriment may be an outstanding grievance or, in this case, an execution filed as a result of an arbitrators' award. In other words, the terms and conditions of a labour agreement flow with the business and once the purchaser has acquired the business then he is obligated to all of the matters that are included within it.

In this case, the purchasers are liable as a party to the award and, by reason of Rule 546, it is appropriate that the order go granting leave to issue execution against Assaf and Fashion Craft in the amounts set out in the writs of execution against Cassin-Remco Limited including interest as specified therein from October 17, 1978.

To hold otherwise would frustrate the intent of the Labour Relations Act and would impede the processing of grievances that are ongoing within a collective agreement. It would mean that while companies were in financial difficulties, no grievances under the agreement would be pursued because there would be a danger that any decision resulting there from would be nullified by a subsequent sale of the assets whereas if the grievance were not filed until after the sale then the usual results would flow from it.

The Canada Board has taken a similar approach to collective agreement obligations while acknowledging that section 144(2)(c) of the Code is not as explicit. In its view the clear intention of the Code is to the same effect. See NABET and Radio CJYQ Ltd. (1978), 1 Can. LRBR 565.

28. The Canada and British Columbia labour boards have also adopted a somewhat similar approach with respect to unfair labour practices or board orders existing at the time of a sale, but the sale of business provisions in those jurisdictions are quite differently worded from section 63(3) of our Act. Section 53(1) of the British Columbia Labour Code provides:

53(1). Where a business or a substantial part of the entire assets thereof, are sold, leased, transferred, or otherwise disposed of, the purchaser, lessee or transferee is bound by all the proceedings under this Act before the date of the sale, lease, transfer or other disposition, and the proceedings shall continue as if no change had occurred; and, where a collective agreement is in force that agreement continues to bind the purchaser, lessee, or transferee to the same extent as if it had been signed by him.

[emphasis added]

Section 144(2) of the Canada Labour Code reads:

144(1) In this section,

'business' means any federal work, undertaking or business and any part thereof;

'sell' in relation to a business, includes the lease, transfer and other disposition of the business.

(2) Subject to subsection (3), where an employer sells his business,

(d) the person to whom the business is sold becomes a party to any proceeding taken under this Part that is pending on the date on which the business was sold and that affects the employees employed in the business or their bargaining agent.

[emphasis added]

29. In Uncle Ben's Industries Ltd., [1979] 2 Can. LRBR 126 a union was seeking severance pay pursuant to a guaranteed wage plan contained in a collective agreement. However, at the date of the purchase no collective agreement was in force and the union had not yet initiated any proceedings before the Board with respect to the claim. In dismissing the claim the Board had the following to say about the meaning of "proceedings" as that term is used in section 53(1):

There are two arms to the section. The first arm binds the purchaser to al the proceedings under the Labour Code. "Proceedings" is not defined in the Code. The meaning which first springs to mind would include matters which have either been determined or are pending before the Labour Relations Board. These would include complaints under Section 8, certifications, prior determinations under Section 53, complaints under Section 96, and in general the various mandatory and declaratory orders which the Board might have made, or might be in the process of making. This interpretation may be defended on the ground that a purchaser could determine from this Board whether there was any application to it or existing order from it which related to the vendor in question. This interpretation of "proceedings" has significant negative implications as well, since it may follow that a purchaser would not be bound by "proceedings" which had not been commenced at this date of purchase. In the present case, for example, the Section 96 and Section 53 claims were not made until eight days after the purchase.

To further complicate matters, the purchaser and the Union signed a new Collective Agreement, but excluded or preserved the Union's on-going claims under Section 96 and 53. [Section 53 claims would have to be kept separate from the "search" or "Notice" arguments, since they will by definition arise upon or after the transfer.]

A considerably wider interpretation of "proceedings under this Act" would include in its ambit all proceedings arising under Collective Agreements, on the ground that the Act sets forth a statutory scheme for settling all such grievances — see Section 92(2). We consider this interpretation too wide for the definition of "proceedings", especially in view of what we will say below, and prefer the first interpretation.

30. A similar approach was taken by the Canada Labour Relations Board with respect to unfair labour practice proceedings pending at the time of a business sale. In Victoria Flying Services Ltd., [1979] 3 Can. LRBR 216 the Board directed reinstatement and compensation to two complainants dismissed in contravention of the Code. This order was dated February 11, 1977. The decision was appealed and the appeal dismissed November 27, 1977. In between these two dates the employer sold the business on June 1, 1977. In holding that the successor employer was obligated to reinstate and compensate the complainants the Board wrote:

Having determined that a sale of business occurred on June 1, 1977 between V.F.S. as vendor and W.C.A., J.A. and C.A. as purchasers, we find that these three companies, according to section 144(2)(d), became bound by the proceedings under this part to which V. F. S. was a party. On June 1, 1977, the certification decision and the unfair labour practices decisions in favour of Messrs. Oncescu and Douglas were pending. At the hearing, C.B.R.T. announced that it was not seeking to enforce the transfer of the certificate issued by the Board so we need not here discuss who would have been bound by the certification issued in favour of C.B.R.T. As regards to the sale of business, we are only concerned with the liability for the reinstatement and compensation of both Mr. Oncescu and Mr. Douglas.

31. Without any successor rights provision at all, the National Labor Relations Board has adopted a similar approach with respect to pending unfair labour practice proceedings, decisions, and orders. In Perma Vinyl Corporation (1967), 164 NLRB 969 the purchaser of a business entered into a sale with knowledge that unfair labour practice proceedings were pending against the vendor. Indeed, the sale occurred after the hearing in those proceedings but before the issuance of any decision. Overruling its earlier decisions to the contrary, the Board concluded that both companies were jointly and severally responsible to comply with the compensation and reinstatement order. In so holding, the Board wrote:

To further the public interest involved in effectuating the policies of the Act and achieve the "objectives of national labor policy, reflected in established principles of federal law, we are persuaded that one who acquires and operates a business of an employer found guilty of unfair labor practices in basically unchanged form under circumstances which charge him with notice of unfair labor practice charges against his predecessor should be held responsible for remedying his predecessor's unlawful conduct.

In imposing this responsibility upon a bona fide purchaser, we are not unmindful of the fact that he was not a party to the unfair labor practices and continues to operate the business without any connection with his predecessor. However, in balancing the equities involved there are other significant factors which must be taken into account. Thus, "It is the employing industry that is sought to be regulated and brought within the corrective and remedial provisions of the Act in the interest of industrial peace." When a new employer is substituted in the employing industry there has been no real change in the employing industry insofar as the victims of past unfair labor practices are concerned, or the need for remedying those unfair labor practices. Appropriate steps must still be taken if the effects of the unfair labor practices are to be erased and all employees reassured of their statutory rights. And it is the successor who has taken over control of the business who is generally in the best position to remedy such unfair labor practices most effectively. The imposition of this responsibility upon even the bona fide purchaser does not work an unfair hardship upon him. When he substituted himself in place of the perpetrator of the unfair labor practices, he became the beneficiary of the predecessor's unfair labor practices. Also, his potential liability for remedying the unfair labor practices is a matter which can be reflected in the price he pays for the business, or he may secure an indemnity clause in the sales contract which will indemnify him for liability arising from the seller's unfair labor practices.

32. This approach was reviewed by the United States Supreme Court in Golden State Bottling Company Inc. (1973) 73 CCH ¶ 14,124 where a successor employer bought a business with knowledge of an outstanding Board order directing the reinstatement of an employee dismissed by the predecessor employer for union activity. The successor, as was emphasized in Perma Vinyl also continued to operate the business as it had been operated without change. In upholding the principles first outlined in Perma Vinyl the Court held:

[Liability of Successor]

We agree that the Board's remedial powers under s.10(c) include broad discretion to fashion and issue the order before us as relief adequate to achieve the ends, and effectuate the policies, of the Act. Early on, this Court recognized that s. 10(c) does not limit the Board's remedial powers to the actual perpetrator of an unfair labor practice and thereby prevent the Board from issuing orders binding a successor who did not itself commit the unlawful act. We have said that a Board order that, as in this case, runs to the "officers, agents, successors and assigns" of an offending employer, may be applied not only to a new employer "merely a disguised continuance of the old employer." Southport Petroleum Co. v. NLRB, [5 LC ¶ 51,126] 315 U.S. 100, 106 (1942), but also "in appropriate circumstances . . . [to] those to whom the business may have been transferred, whether as a means of evading the judgment or for other reasons." Regal Knitwear Co. v. NLRB, [9 LC ¶5 1,193] 324 U.S. 9, 14 (1945) (emphasis added; see also NLRB v. Ozard Hardwood Co., [40 LC ¶ 66,759] 282 F. 2d 1, 5 (1960). If the words "person named in the complaint engaged in . . . any unfair labor practice" in s. 10(c) do not restrict Board authority to prevent orders running to the offending employer's successors and assigns who have acquired the business as a means of evading the Board order, we do not see how those words may be read to bar the Board from issuing reinstatement and back-pay orders against bona fide successors when the Board has properly found such orders to be necessary to protect the public interest in effectuating the policies of the Act. The Board's orders run to the evader and the bona fide purchaser not because to act of evasion or the bona fide purchase is an unfair labor practice, but because the Board is obligated to effectuate the policies of the Act. Construing s. 10(c) thusly to grant the Board remedial power to issue such orders results in a reading of the section, as it should be read, in the light of" 'the provisions of the whole law, and ... its object and policy."' Mastro Plastics Corp. v. NLRB 129 LC ¶ 69,779] 350 U.S. 270, 285 (1956); see NLRB v. Lion Oil Co., [31 LC ¶70,446] 352 U.S. 282, 288 (1957).

[Policy of Act]

We in no way qualify the Burns' holdings in concluding that the Board's order against All American strikes an equitable balance. When a new employer, such as All American, has acquired substantial assets of its predecessor and continued, without interruption or substantial change, the predecessor's business operations, those employees who have been retained will understandably view their job situations as essentially unaltered. Under these circumstances, the employees may well perceive the successor's failure to remedy the predecessor employer's unfair labor practices arising out of an unlawful discharge as a continuation of the predecessor's labor policies. To the extent that the employees' legitimate expectation is that the unfair labor practices will be remedied, a successor's failure to do so may result in labor unrest as the employees engage in collective activity to force remedial action. Similarly, if the employees identify the new employer's labor policies with those of the predecessor but do not take collective action, the successor may benefit from the unfair labor practices due to a continuing deterrent effect on union activities. Moreover, the Board's experience may reasonably lead it to believe that employers intent on suppressing union activity may select for discharge those employees most actively engaged in union affairs, so that a failure to reinstate may result in a leadership vacuum in the bargaining unit. CF. Phelps Dodge Corp. v. NLRB [4 LC ¶ 51,120] 313 U.S. 177, 193 (1941). Further, unlike Burns, where an important labor policy opposed saddling the successor employer with the obligations of the collective bargaining agreement, there is no underlying congressional policy here militating against the imposition of liability.

Avoidance of labor strife, prevention of a deterrent effect on the exercise of rights guaranteed employees by s.7 of the Act, 29 U.S.C. s. 57, and protection for the victimized employee-all important policies subserved by the National Labor Relations Act, see 29 U.S.C. s. 141 — are achieved at a relatively minimal cost to the bona fide successor. Since the successor must have notice before liability can be imposed, "his potential liability for remedying the unfair labor practices is a matter which can be reflected in the price he pays for the business, or he may secure an indemnity clause in the sales contract which will indemnify him for liability arising from the seller's unfair labor practices." Perma Vinyl Corp., supra, 164 NLRB, at 969. If the reinstated employee does not effectively perform, he may, of course, be discharged for cause. See 29 U.S.C. s. 160(c).

33. However, none of the cases arising in other jurisdictions support the result requested by the trade union on the facts before us. No proceedings were pending before the Board which the trade union now seeks to enforce and the business was not continued unchanged to trigger the rationale set out in the latter part of the Golden State decision. Counsel for the trade union contended that Maple Leaf had notice of Sunnylea's anti-union intent in disposing of its business and that this was knowledge of an unfair labour practice within the meaning of the American approach. But both Golden State and Perma Vinyl involved outstanding unfair labour practice proceedings. The purchaser had notice or could have been aware of such proceedings and their potential outcome could have been taken into account. It is quite another matter to make a vendor responsible for all actions of the purchaser which the vendor has notice of and which could be unfair labour practices even though no complaint has been filed. How could these matters realistically be taken into account? The vendor could deny that the actions were improper and point to the fact that there has been no complaint. Admittedly, the trade union could not have filed a complaint before the sale because the sale is the very act complained of. But this is no reason for ignoring the situation in which the union's argument places Maple Leaf. Given the great complexity in this case; the fact that the business was moved; and Maple Leafs awareness of Zonneveld's financial predicament, we fail to see how the commercial negotiations could realistically have taken the union's potential claim into account. Thus, even if the combined wording of section 63 and 89 permits us to do what the trade union has requested, we deny the request.

34. We now turn to whether Jacob Zonneveld and Sunnylea violated the Labour Relations Act in closing the Sunnylea Grimsby plant in October of 1980. There have been a number of cases before this Board involving a similar issue. See Webster & Horsfall (Canada) Ltd., [1969] OLRB Rep. Sept. 780; Humpty Dumpty Foods Limited, [1977] OLRB Rep. July 401; Academy of Medicine, [1977] OLRB Rep. Dec. 783; and Westinghouse Canada Limited, [1980] OLRB Rep. April 577. American cases make a distinction between a complete closure by a single employer and the closure of part of a business, holding that under the Wagner Act an employer has the absolute right to terminate his entire business for any reason he pleases no matter what the reasons. On the other hand, temporary closings, runaway shops and partial closings are prohibited where motivated by anti-union considerations because of the benefits the employer may intend to reap by discouraging other or future employees from engaging in collective bargaining. See Textile Workers v. Darlington Mfg. Co. (1965), 58 LRRM 2657. The Ontario Board has expressly disagreed with this distinction and relying on section 77, has held that an employer may not even terminate his entire business if the motive is contrary to the Labour Relations Act. In Academy of Medicine, [1977] OLRB Rep. Dec. 783 the Board wrote:

There is nothing, moreover, in the general scheme of the Act which would suggest that an employer may, with impunity, terminate its entire business rather than operate with a union. The Labour Relations Act is based on the policy (embodied in the preamble) that collective bargaining, with the right to strike and lock-out, in the event of an ultimate impasse, is the preferred method of settling the terms and conditions of employment between employers and employees in the Province. To ensure the achievement of this policy, the Act establishes procedures for the acquisition of bargaining rights and mandates certain practices and conduct to encourage and regulate the collective bargaining relationship once established. The unfair labour practice sections of the Act, taken together, constitute a general prohibition against any kind of anti-union conduct. These sections are designed to protect the basic right of employees to join a trade union and to participate in its lawful activities, as well as the right of unions to organize and represent employees, free from employer interference. It is difficult to conceive of conduct more destructive of these rights than a permanent closure of a business, based not upon legitimate business considerations but upon an employer's simple refusal to operate with a trade union. If the Board were to hold that such conduct is permissible under the Act, it would be giving carte blanche to employers, such as the respondent, with a "discontinuance" capacity to frustate the policy which the Statute so clearly prescribes. The respondent's threat to close its Call Answering Service if the union was successful constitutes a clear violation of The Labour Relations Act. It would be strange indeed if the total effectuation of that threat — the permanent discontinuance of its Answering Service did not also constitute a violation. It would be stranger still if an employer violates the Act by firing some of its employees for their union membership or activity, but not by firing them all.

35. In determining motive it is relevant to note, as the trade union emphasized, the earlier unfair labour practices of Sunnylea that marked the certification proceedings. By decision dated June 1980 the Board found that Virginia Neufeld had been discharged by Sunnylea on February 1980 contrary to the Labour Relations Act. By decision dated March 13, 1980 the Board found that Robert Berton and Debbie Henson were discharged contrary to the Act. And by decision dated April 30, 1980 the Board found that four other employees had been laid off contrary to the Act and that Jack and Leen Zonneveld had unlawfully threatened to close Sunnylea if the union was certified. However, Zonneveld testified before this panel that Sunnylea was "dead" the moment the Royal Bank in Grimsby requested Sunnylea to move its business and it is clear he had been looking for a purchaser since October 1978. Thus, it was submitted that the actual sale of the Sunnylea business and the presence of the trade union were coincidental and that Zonneveld and Sunnylea were motivated only by economic considerations. The matter of motive is further complicated by Zonneveld's testimony that the union was always on his mind and that the joy went out of running his business with its arrival; that he could not have continued the business with the presence of the union and had he been able to carry on economically he would have fought the trade union until the employees lost interest; and, that with the certification of the trade union he had the options of closing his business, selling it, or seeking an amalgamation. We are also satisfied that on the evidence before us the treatment of Berton was primarily based on his support for the trade union. No attempt was made to contact Berton's doctor about his ability to drive and, having regard to all the surrounding circumstances, his assignment to an even more physically demanding job can only be seen as punishment for his union activity. The issue is whether Sunnylea and Zonneveld, in closing and selling Sunnylea's business, were also motivated in whole or in part by anti-union considerations. It is not sufficient for the respondents to demonstrate that their predominate motive was economic in nature. As the Board said in Westinghouse Canada Limited, supra, at para. 50:

The Labour Relations Act is based on the policy of collective representation of employees as the preferred method of regulating employer/employee relations. The Act establishes a legal framework within which employees are free to join together, bargain collectively and take collective economic action at certain prescribed times. The unfair labour practice sections of the act prohibit a broad range of anti-union conduct and serve to protect employees in the exercise of the basic rights accorded under the statute. This Board, with judicial support, has held that any employer action against an individual employee which is even partly motivated by anti-union sentiment is in violation of the Act, notwithstanding the coexistence of legitimate business purpose. Having regard to the policy underpinnings of the Act and the degree of anti-union motive necessary to cause an unfair labour practice finding in respect of actions taken against an individual employee, it would seem unusual to conclude that a major business decision taken even in part for anti-union reasons, and having a major adverse impact upon the economic lives of a number of employees, is permissible under the Act. This, however, is the precise result which flows from the approach urged upon us.

36. There can be little doubt that Zonneveld's previous actions, reviewed in other Board decisions and his testimony before us, reveal a strong anti-union sentiment arising, of course, out of a religious conviction. Indeed, the purport of the trade union's case was that given Zonneveld's admissions under cross-examination and the background to the case, it was impossible for Zonneveld to prove the closing was free of anti-union animus. However, the trade union did not dispute Sunnylea's financial situation and the related fact that it had been asked by the Royal Bank to take its business elsewhere. It was also accepted that the entire proceeds of the sale went directly to the Canadian Imperial Bank of Commerce to reduce Sunnylea's substantial indebtedness. The evidence establishes that Sunnylea was for sale before the trade union arrived on the scene and that the very business discussions leading to the contested sale commenced before the trade union organized the employees of Sunnylea. We are also satisfied that the failure of Sunnylea to raise the matter of the sale in the bargaining process was related to business considerations and does not evidence an anti-union animus. While it may have been a breach of section 15, this aspect of the facts was not argued before us. Considering all of these facts and the other evidence before us, we have come to the conclusion, on the balance of probabilities, that the sale would have occurred with or without the presence of the trade union and that it was therefore economically and only economically motivated. Indeed, the evidence is strong that Sunnylea would have gone out of business sooner had it not been for the interest of W. B. Cross and its related temporary financial assistance through the Canadian Imperial Bank of Commerce. We might add that even if we had concluded that the sale was not entirely free of anti-union animus, the evidence does not indicate to us that the business was sufficiently viable to carry on much beyond what it did. Accordingly, only a nominal remedy would have been justified.

37. On the other hand, we are satisfied on the evidence that the former employees of Sunnylea who applied for employment in October 22, 1980 at Maple Leaf were not hired because of their earlier trade union activity and suspected support of the complainant trade union. Maple Leafs commuting policy was not uniformly applied. Lammers had specific knowledge from Tuvel that the employees had been involved in earlier proceedings before the Board; and, most importantly, Lammers admitted that he might have hired them had they attended on another day. With respect to this latter admission, no explanation was given as to why they were not called or offered work on the basis of their applications for employment which they had left with Maple Leaf. Having regard to all of the evidence and the manner in which Lammers gave his testimony, we think it more probable than not that they were refused employment because of their suspected trade union activity. They are, therefore, entitled to be hired and to monetary compensation with interest for their losses occasioned by this breach of the Act. See Metropolitan Parking Inc., [1979] OLRB Rep. Dec. 1193. We agreed to retain jurisdiction on the issue of remedy and any difference between the parties on this issue can be referred back to us by either party. We also direct the respondent Maple Leaf to post copies of the attached notice in its plant for 60 days. There is likely to be much confusion in the plant on the reinstatement of the grievors and all employees are entitled to know the background of this action of the Board.

38. The respondents Sunnylea and Jacob Zonneveld, based on our findings above, are directed to compensate Robert Berton with interest for the monetary losses experienced because of his unlawful treatment. Authority for this ruling going against Zonneveld personally can be found in the general wording of sections 64, 66 and 89 of the Labour Relations Act. Sections 64 and 66 directly refer to persons acting on behalf of any employer and section 89 contains equally broad language. With the greatest of respect to my colleague, Mr. Ronson, I am not aware of the policy to which he refers. I can conceive of a number of situations where it would be appropriate to name the person responsible for the unfair labour practice where that person is primarily in control of the employing entity or other organization. It is my view that this is such a case. Jacob Zonneveld, for all intents and purposes, is Sunnylea and Sunnylea is no longer in business. No matter how mild the remedy, it is one that the complainant should be able to pursue against the ongoing activities of Mr. Zonneveld. Indeed, had the complainant's core allegations been established, a remedy confined to Sunnylea may have been quite ineffective. If the potential for personal liability is not understood in the labour relations community, I would hope this decision sheds some light on the matter.

39. To summarize our ruling:

(a) The application under section 63 is dismissed.

(b) The respondents Sunnylea and Zonneveld are directed to compensate Robert Berton with interest for all losses sustained because of his unlawful termination.

(c) The respondent Maple Leaf is directed to post copies of the attached notice marked "Appendix" after being duly signed by a Maple Leaf representative, in conspicuous places on its premises in the City of Mississauga where it is likely to come to the attention of the employees, and to keep the notices posted for sixty consecutive working days. Reasonable steps shall be taken by the respondent Maple Leaf to ensure that the said notices are not altered, defaced or covered by any other material. Reasonable physical access to the premises shall be given by the respondent Maple Leaf to a representative of the complainant so that the complainant can satisfy itself that this posting requirement is being complied with. The respondent Maple Leaf is also directed to offer employment and to compensate with interest Harvey Crowe, Sandra Rattle, Debbie Henson, Candy Morris, Denise Dochstader, and Kathy Travis. Differences over the amount of such compensation can be referred to the Board by either party.

(d) All other requests for relief and related allegations of violations are dismissed.

(e) All interest directed to be paid under this order should be calculated according to the Board's Practice Note number 13, published in [1980] OLRB Rep. September.

DECISION OF BOARD MEMBER, JAMES A. RONSON;

1. I agree with the findings of fact and the remedies ordered by the Chairman in his decision, save for the following remedy with which I disagree.

2. In paragraph 39, the respondent Jacob Zonneveld is ordered to personally compensate Robert Berton for his monetary losses. It has never been the policy of this Board to make employees and/or shareholders of a limited company personally liable for payment of compensation pursuant to a Board order. There are three specific reasons why I disagree with such an order in this case:

(a) a settlement was pleaded and we heard no evidence (other than that it was without prejudice) to indicate that Mr. Berton suffered a loss;

(b) over 6 months went by before the union brought this specific complaint; and

(c) the only reason to deviate from Board policy would be that Mr. Zonneveld deliberately closed his business for anti-union reasons and created a situation in which an order for compensation would be worthless as against the limited company. That is not the finding of the majority of this panel.

DECISION OF BOARD MEMBER, W. F. RUTHERFORD;

I concur with the facts presented in the Board's decision, including the Board's order to the respondent Maple Leaf. Regarding the respondent Jacob Zonneveld, I would have expanded the Board's order to include the organizational, negotiating, and legal costs incurred in any action involving Sunnylea.

I base this opinion on my reading of the evidence presented. Jacob Zonneveld made his anti-union policy public knowledge in a Globe and Mail interview; his answer to charges substantiated before the Labour Board of anti-union actions against leading union employees at Sunnylea. Further in evidence he stated he knew he was closing the business while first contract negotiations were proceeding. This knowledge of the proposed closing was not transmitted to the union officially until the day after it had been posted in the plant.

I would find that Jacob Zonneveld, knowing he was going out of business, had his representative in negotiations "surface bargain" while the transfer of operations to Maple Leaf was being concluded, thereby further increasing union costs.

The above is a capsule of my opinion why Jacob Zonneveld's costs should be expanded in this action before the Board.

Appendix

The Labour Relations Act

NOTICE TO EMPLOYEES

Posted by Order of the Ontario Labour Relations Board

We have posted this notice in compliance with an order of the Ontario Labour Relations Board issued after a hearing in which we and the complainant union participated. The Ontario Labour Relations Board found that we violated the Labour Relations Act, by failing to hire Harvey Crowe, Sandra Rattle, Debbie Henson, Candy Morris, Denise Dochstader and Kathy Travis.

The Act gives all employees these rights;

To organize themselves;

To form, join and participate in the lawful activities of a trade union;

To act together for collective bargaining;

To refuse to do any and all of these things.

We assure all our employees that:

WE WILL NOT do anything that interferes with these rights.

WE WILL hire Harvey Crowe, Sandra Rattle, Debbie Benson, Candy Morris, Denise Dochstader and Kathy Travis.

WE WILL make monetary compensation with interest to these individuals for their losses occasioned by the breach of the Act.

MAPLE LEAF EGG PRODUCTS LTD.

Per: (Authorized Representative)

This is an official notice of the Board and must not be removed or defaced.

This notice must remain posted for 60 consecutive working days.

DATED this 24th day at November . 19 81.