Tactix Construction Limited v. United Brotherhood of Carpenters & Joiners of America, Local 27, 1990 CanLII 5802

[1990] OLRB Rep. April 467

0821-88-R Tactix Construction Limited, Applicant v. United Brotherhood of Car­penters & Joiners of America, Local 27, Respondent v. Labourers' International Union of North America, Local 183, Intervener

BEFORE: N. B. Satterfield, Vice-Chair, and Board Members D. A. MacDonald and H. Kobryn.

APPEARANCES: Nancy Courtney and Andy Senyi for the applicant; David McKee and Frank D'Abbondanza for the respondent; no one appearing for the intervener.

DECISION OF THE BOARD; April 25, 1990

1. Tactix Construction Limited applied under subsection 1(4) of the Labour Relations Act for a declaration that it, together with three other corporations, Mark/Barry Holdings Ltd., Stash Investments Inc. and Danand Investments Limited be treated as constituting one employer for purposes of the Act. For ease of reference, the Board will refer to the four corporations as ("Tac­tix", "Mark/Barry", "Stash" and "Danand"). Tactix later sought to withdraw its application. The Board refused Tactix' request and allowed the request of the United Brotherhood of Carpenters and Joiners of America, Local 27 to pursue an independent claim for relief made in its reply to the application. The Board's reasons for refusing Tactix' request and allowing the request of Local 27 are set out in the Board's decision which issued August 21, 1989 [reported at [1989] OLRB Rep. Aug. 903]. Local 27's request for relief included a request that those same four corporations, together with Jilsen Investments Inc., be treated as constituting one employer for purposes of the Act. This decision deals with the merits of that request.

2. It is useful to an understanding of Local 27's claim for relief to summarize briefly the chronology of events leading up to the Board's decision issuing on August 21, 1989. That decision sets out the chronology in full. Local 27 was certified on February 18, 1988 to represent Tactix' car­penters employed in the industrial, commercial and institutional ("ICI") sector of the construction industry in the Province of Ontario and in all other sectors of the construction industry in the Board's geographic area #8. That geographic area includes Metropolitan Toronto and adjacent municipalities. On the same date, in a separate application which was heard together with Local 27's application for certification, the Board also certified the Labourers' International Union of North America, Local 506 for Tactix' construction labourers employed in the ICI sector and in all other sectors in Board area #8. Tactix was represented by experienced labour relations counsel at the hearing into the two applications and had agreed together with Local 27 and Local 506 to the descriptions of the unit of employees in each application which the parties considered to be appro­priate for collective bargaining purposes. The Board accepted the agreement of the parties. Since both applications had been made under subsection 144(1) of the Act, two certificates were issued in each application pursuant to subsection 144(2) of the Act, one for the ICI sector and the other for all other sectors in Board area #8. Some four months later, Tactix applied to have the Board reconsider its February 18th decision and revoke Local 27's certificate for Tactix' carpenters in all other sectors of the construction industry in Board area #8. The application was made through Tactix' solicitors, a different firm than the one which represented it at the certification hearing. No request was made to revoke the similar certificate of Local 506. The application for a declaration under subsection 1(4) of the Act was made in support of and at the same time as the request for reconsideration. Labourers' International Union of North America, Local 183 also requested that the Board reconsider its decision and revoke the certificate to Local 27 and intervened in the appli­cation under subsection 1(4).

3. The basis of their applications was the claim that Tactix was bound to a collective agree­ment between the Metropolitan Toronto Apartment Builders Association ("the MTABA") and Local 183 which was alleged to have made Local 183 the bargaining agent for all of Tactix' con­struction employees, including its carpenters. According to Tactix and Local 183, Tactix was bound to the MTABA agreement because it was an employer carrying on related businesses with Danand, Stash and Mark/Barry, and Mark/Barry was bound to the MTABA agreement.

4. An essential element of their theory was that the MTABA agreement established bar­gaining rights for Local 183 for carpenters of employers bound to the agreement. At the time the requests for reconsideration were made, that issue was being litigated with respect to another employer unrelated to any of the five corporations named in this proceeding, before a different panel of the Board. All of the parties agreed that it would be appropriate to adjourn the request for reconsideration and this application until that issue was decided by the other panel. The other panel of the Board ultimately found that Local 183 did not have bargaining rights for carpenters employed by employers bound to the MTABA agreement.

5. When that issue was finally resolved, Tactix and Local 183 requested leave to withdraw their applications for revocation of Local 27's certificate and in addition, Tactix requested leave to withdraw this application. The Board consented to the request for withdrawal of the applications for reconsideration but, for the reasons given in its decision which issued August 21, 1989, refused Tactix' request to withdraw this application. After two further adjournments at the request of Tac­tix and Local 27, Local 27's request for relief under subsection 1(4) of the Act came before the Board for hearing on February 26, 1990.

6. Tactix and Jilsen were represented by counsel at the hearing, but Mark/Barry, Stash and Danand were neither present nor represented. The parties filed an agreed statement of facts with the Board which had been executed between Tactix, Jilsen and Local 27. They also stipulated further facts orally to the Board and Local 27 filed the most recent corporate returns of the corpo­rations and a copy of minutes of settlement executed between Local 27, Local 506, Tactix and Jil­sen at the time the two unions' applications for certification were being processed by the Board.

7. The parties agreed as well that the Board should determine from the agreed facts and the documents filed by Local 27 whether any two or more of the five corporations carry on related activities or businesses under common control or direction within the meaning of subsection 1(4) of the Act. The parties agreed further to limit their submissions to the issue of whether the Board should exercise its discretion to make the declaration requested by Local 27 in the event that the Board finds, on those facts, that it does have the discretion. Accordingly, the Board's findings of fact herein are made from the agreed statement of facts executed between Tactix, Jilsen and Local 27, the further facts agreed to by them at the hearing and the documents filed by Local 27 at the hearing.

8. Mark/Barry was incorporated in the earlier 1970's and, from that time until approxi­mately 1981, was involved primarily in the construction and development of apartment complexes. It has been inactive and has employed no employees since 1981. From incorporation until the mak­ing of this application, Mr. Mel Greenspoon was president and a director of Mark/Barry and held a thirty-seven and a half per cent ownership interest in it. Stash was formed as a joint venture in the late 1970's by Mark/Barry and another corporation. Mark/Barry held a fifty per cent interest in Stash. Stash constructed a number of apartment buildings in the Metropolitan Toronto area in the late 1970's and early 1980's. It has been inactive and has employed no employees since approxi­mately 1983. Greenspoon was the secretary and a director of Stash, and remained so as at the date of making of this application. Danand was incorporated on April 20, 1977, and between then and 1985 it built at least one apartment project in the Metropolitan Toronto area. Mr. Andy Senyi was its vice-president and one of its directors from incorporation until 1985 when he resigned those positions. Jilsen was incorporated February 11, 1982. Its relationship with Tactix began when Tac­tix was incorporated June 24, 1982. Jilsen owns twenty-five per cent of the shares of Tactix and between 1982 and April 30, 1988, Jilsen employed the carpenters and construction labourers who performed construction work for Tactix. These trades were employed by Jilsen for administrative reasons because Tactix did not have a computerized payroll. It established a computerized payroll on April 30, 1988, and at that time Jilsen ceased to employ any employees and has remained inac­tive in the construction industry without employees since that time. Tactix has been involved in construction projects in the ICI and residential sectors of the construction industry. Senyi is the president and sole director of Tactix. Greenspoon is vice-president in charge of Tactix' construc­tion activities. Greenspoon directed the construction activities of Mark/Barry and Stash during all of the time when they were active in the construction industry. He also directed the construction activities of Danand from its incorporation until he resigned his position with Danand in 1985 at the same time Senyi resigned as vice-president and director.

9. In the minutes of settlement executed January 25, 1988, between Local 27, Local 506, Tactix and Jilsen, both parties agreed that Tactix and Jilsen are related employers within the mean­ing of the Labour Relations Act. As a condition of the minutes of settlement, Local 27 and Local 506 withdrew applications for certification which each had made in January 1988 with respect to carpenters and construction labourers employed by Tactix and Jilsen.

10. It is agreed that Mark/Barry joined the Metropolitan Toronto Apartment Builders Association in 1976. It is undisputed that Mark/Barry became bound to the MTABA agreement at that time and that Local 183's bargaining rights under that agreement survived at the date of mak­ing of this application.

11. Subsection 1(4) of the Labour Relations Act provides as follows:

(4) Where, in the opinion of the Board, associated or related activities or businesses are carried on, whether or not simultaneously, by or through more than one corporation, individual, firm, syndicate or association or any combination thereof, under common control or direction, the Board may, upon the application of any person, trade union or council of trade unions con­cerned, treat the corporations, individuals, firms, syndicates or associations or any combination thereof as constituting one employer for the purposes of this Act and grant such relief, by way of declaration or otherwise, as it may deem appropriate.

The subsection sets out three preconditions which must be satisfied in order for the Board to have discretion to treat more than one corporation, individual, firm, syndicate or association or any combination thereof as constituting one employer for purposes of the Act. They are:

(1) there must be more than one corporation, individual, firm, syndicate or association or any combination thereof;

(2) the activities or businesses of two or more of those entities must be under common control or direction; and

(3) the entities concerned must carry on related or associated activities or businesses.

It is not necessary that the related or associated activities or businesses be carried on simultane­ously. For examples, see Brant Erecting and Hoisting, [1980] OLRB Rep. July 945 and Warren Steeplejacks Limited, [1989] OLRB Rep. March 309.

12. Although the facts do not establish a common ownership link between the five corpora­tions, their construction operations during their periods of activity in the residential sector of the construction industry were effectively under the control of one person, Mel Greenspoon. In addi­tion, Greenspoon was a director and/or officer of Mark/Barry, Stash and Tactix and remains so today. Andy Senyi also was a director and/or officer of Danand and Tactix. He resigned his posi­tion in Danand in 1985 but remained president and sole director of Tactix as at the date of making of this application. Jilsen owns twenty-five per cent of the shares of Tactix, with which it was engaged in residential construction activities. Tactix, Jilsen and Local 27 agree that Tactix and Jil­sen carry on related activities or businesses under common control or direction within the meaning of subsection 1(4) of the Act.

13. Therefore, on those facts, the Board is satisfied that Mark/Barry Holdings Ltd., Stash Investments Inc., Danand Investments Limited, Jilsen Investments Inc. and Tactix Construction Limited are corporations carrying on associated or related activities or businesses under common control or direction within the meaning of subsection 1(4) of the Act. Thus, the statutory precondi­tions exist for the Board to have the discretion under subsection 1(4) to treat two or more of those corporations as constituting one employer for purposes of the Act. It remains to be decided whether the Board should exercise this discretion respecting any two or more of the five corpora­tions just named. That question will be decided based on the facts before the Board and the sub­missions thereon of counsel. Although the Board will not summarize their submissions, it has reviewed and weighed them in coming to the conclusions reached below.

14. When Tactix made this application in conjunction with its request to have the certificate which the Board had issued to Local 27 revoked, Tactix had asserted the labour relations purpose of its application to be the apparent conflict between Local 27's bargaining rights and those alleged for Local 183 under the MTABA agreement. If that was the purpose, it evaporated when Tactix and Local 183 accepted the conclusion of another panel of the Board that the MTABA agreement did not contain bargaining rights for carpenters employed by the employer bound to that agree­ment in the application before that panel. Tactix also asserted that there was no other valid labour relations purpose for the application. Those grounds were advanced by Tactix at the hearing into Local 27's request to have the application processed on its merits. The Board rejected Tactix' argu­ment for the reasons set out in its August 21, 1989 decision.

15. Local 27's concern then and now is founded in the readiness and willingness with which Tactix sought to revive the four dormant corporations as a basis for asserting that Local 183 held prior collective bargaining rights for Tactix' carpenters employed in the residential sector of the construction industry. Had Tactix been able to establish that the MTABA agreement did indeed give Local 183 bargaining rights for Tactix' carpenters and had it been successful in getting the Board to declare that Tactix, Mark/Barry, Stash and Danand were to be treated as constituting one employer, the result would have been the elimination of Local 27's bargaining rights with respect to the residential sector.

16. The Board has commented before that ". . .a firm engaged in the construction business can, with relative ease, become involved, from time to time, in various sectors, subdivisions, phases or specialized kinds of construction work, depending largely upon the business opportuni­ties which present themselves,...". Frank Plastina Investments Ltd., [1986] OLRB Rep. June 720, at paragraph 20. In this respect see also the Board's comments at paragraph 13, Brant Erecting and Hoisting, supra.

17. Having regard to the ease with which a firm can become active and cease to be active in the construction industry, Tactix' readiness to revive Mark/Barry, Stash and Danand four months after the Board issued its certificate to Local 27 respecting Tactix' carpenters employed in the resi­dential and other sectors of the construction industry, sends a clear message to Local 27 about the vulnerability of those bargaining rights to potential erosion unless Local 27 is protected by a decla­ration under subsection 1(4) of the Act to treat those corporations as one employer for purposes of the Act.

18. The Board agrees with Local 27's perception that its bargaining rights would be exposed to potential erosion if the Board does not make the declaration requested. The Board does not agree, however, that the existence of Danand Investments Limited poses a threat to Local 27's bar­gaining rights. This is because both Greenspoon and Senyi resigned from their positions with Danand in 1985 and would no longer be able to exercise any direction over its construction activi­ties. With respect to the other corporations, however, Greenspoon remains an officer and/or a director of Mark/Barry, Stash and Tactix, Senyi is president and sole director of Tactix. Tactix is twenty-five per cent owned by Jilsen and they were still engaged together in residential construc­tion when the Board certified Local 27 for Tactix' carpenters. Greenspoon also remains in charge of the construction activities of Tactix.

19. In these circumstances, and having regard for the fact that Tactix was prepared to rely on the interrelationship of Mark/Barry, Stash and Danand in order to try and extinguish Local 27's bargaining rights for Tactix' carpenters in the residential sector, the Board is satisfied that Mark/Barry, Stash, Jilsen and Tactix are a source of potential erosion of Local 27's bargaining rights. Therefore, the Board is satisfied that these are circumstances in which it should exercise its discretion under subsection 1(4) of the Act to declare that Mark/Barry Holdings Ltd., Stash Invest­ments Inc., Jilsen Investments Inc. and Tactix Construction Limited be treated as constituting one employer for the purposes of the Labour Relations Act, and the Board so declares. Accordingly, Mark/Barry Holdings Ltd., Stash Investments Inc., Jilsen Investments Inc. are bound to the car­penters provincial agreement and, together with Tactix, they are obliged also by section 15 of the Labour Relations Act to bargain in good faith with the United Brotherhood of Carpenters & Join­ers of America, Local 27 and make every reasonable effort to make a collective agreement for all sectors of the construction industry, except the industrial, commercial and institutional sector.

20. For the reasons given above, this application is dismissed with respect to Danand Investments Limited.