Teamsters Local Union No. 419 v. Steinberg Inc., 1992 CanLII 6326

Teamsters Local Union No. 419 v. Steinberg Inc.

[1992] OLRB Rep. July 860

1346-90-R; 1347-90-R; 1617-90-U; 1830-90-U Teamsters Local Union No. 419 affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehouse-men and Helpers of America, Applicant v. Steinberg Inc. (Miracle Food Mart Division) and The Great Atlantic and Pacific Company of Canada Limited, Respondents v. Retail, Wholesale and Department Store Union, AFL CIO CLC, and its Local 414, Intervener; R. Carniel et al, Complainant, v. Steinberg Inc. (Miracle Food Mart Division) and The Great Atlantic and Pacific Company of Canada Limited, Respondents; Teamsters Local Union No. 419 affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Applicant v. Steinberg Inc. (Miracle Food Mart Division) and The Great Atlantic and Pacific Company of Canada Limited, Respondents

BEFORE: Susan Tacon, Vice-Chair, and Board Members G. O. Shamanski and R. R. Montague.

APPEARANCES: J. James Nyman and Robert McGibbon for the applicant/complainant in Board Files 1346-90-R, 1347-90-R and 1830-90- U; Paul Jarvis for Steinberg Inc.; D. I. Shields, H. Freedman and Tom Zakrzewski for the Great Atlantic and Pacific Company of Canada Limited, Susan Ballantyne, B. Hanson and Robert McKay for the intervener in Board Files 1346-90-R and 1347- 90-R; David Moore and Michael Battista for the complainant in Board File 1617-90-U.

DECISION OF THE BOARD; July 28, 1992

1. Board Files 1346-90-R and 1347-90-R are applications pursuant to section 63 (now section 64) and 1(4) of the Labour Relations Act. Board Files 1617-90-U and 1830-90-U are complaints pursuant to section 89 [now section 91] of the Act. The Board commenced its hearing in these matters in October 1990. By June 1992, there had been over twenty-five days of hearing and a number of written interim orders and rulings dealing with various issues. It appeared that the remaining dates scheduled in June 1992 would complete the evidence and submissions of the parties. When the Board reconvened on June 2, 1992, counsel for the respondent Steinberg indicated that an order under the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36 (the "C.C.A.A.") had been signed by Judge Denis of the Quebec Superior Court on May 31, 1992, the effect of which, it was asserted, was to stay the instant Board proceedings.

2. The Board heard full submissions with respect to the impact of the court order, if any, on the Board's proceedings as against the respondent Steinberg and as against the respondent A&P, including representations as to whether, if the Board could proceed in some fashion against Steinberg and/or A&P whether it should do so. The able and thorough submissions of counsel are set in summarized form. Counsel for the intervener RWDSU (Mr. Hanson on the day in question) did not make submissions. It should also be noted that Mr. Freedman made submissions on behalf of A&P with respect to this matter.

3. Counsel for Steinberg submitted that the words of the C.C.A.A. in section 11 are very broad, reflecting the broad remedial intention of the legislation. The C.C.A.A. was designed to create a "cocoon", in effect, around a company for a brief period of time to permit an opportunity for restructuring and preservation of the company as an ongoing concern, if possible. Moreover, the court order itself (in items 14, 15 and 16) is broadly phrased. On their face, both the statute and the court order apply to Board proceedings. Further, it was argued that the courts, in interpreting the legislation and, in particular, the word "proceedings" in section 11 of the C.C.A.A. encompassed far more than judicial proceedings, narrowly defined, and far more than creditors. Counsel asserted that, unless the Board was certain the court order has no application herein, the Board should stay these proceedings, especially as the implication of interpreting the court order incorrectly is contempt. In counsel's view, the proper course of action for the individual complainants and the Teamsters is to seek from the Judge of the Quebec Superior Court who issued the order a modification of the court order to permit the Board proceedings to continue. Counsel acknowledged that Steinberg did not disclose the existence of the instant Board proceeding in the material filed in respect of the court order obtained by Steinberg on an ex parte basis. It was contended, however, that it was not for the Board to second guess the judge as to whether he intended that these proceedings should be caught by the court order. The proper route to clarify that question was a motion before Judge Denis. Counsel also acknowledged that he had no instructions to facilitate a motion by the individual complainants and/or the Teamsters seeking modification of the court order. It appears (and was not disputed) from communications between the individual complainants and the Quebec firm of Langlois Robert acting for Steinberg and the coordinator appointed by the court that both Steinberg and the coordinator would, at this point, oppose any modification in the order which would permit the Board proceedings to be be completed. Cases referred to included: Quintette Coal Limited v. Nippon Steel Corporation et al 1990 CanLII 430 (BC CA), [1990], 51 B.C.L.R. (2d) 105 (B.C.C.A.); Norcen Energy Resources Limited and Prairie Oil Royalties Company Ltd. v. Oakwood Petroleums Ltd. (1988), 1988 CanLII 3560 (AB QB), 63 Alta. L.R. (2d) 361 (Alta. Q.B.).

4. Counsel for A&P adopted the submissions of counsel for Steinberg with respect to the broad remedial purpose of the statute and the effect of the court order on these proceedings. Further, counsel submitted that the C.C.A.A. is legislation whose validity has been upheld and, by virtue of the doctrine of paramountcy, overrides to the extent necessary to give effect to the legislation provincial authority in section 92(12) of the Constitution Act. It was argued the caselaw had clearly given a broad reading to the term "proceedings" to include quasi-judicial processes, a set-off flowing from a prior arbitration, sheriffs seizure, for example. Board proceedings were clearly caught by the term. Counsel submitted that the C.C.A.A. precluded enforcement (for the term of a stay order) of other statutory rights. Counsel agreed with counsel for Steinberg that the proper route for the individual complainants and the Teamsters is for those parties to seek a modification of the stay order before the Judge issuing the original order. Counsel also contended that, should the Board agree that proceedings were stayed as against Steinberg because of the court order, the Board should likewise stay proceedings as against A&P. That is' it was inappropriate, improper and unfair to proceed against A&P alone given that the matter thus far had been treated as one proceeding. It was argued that the complainants would have had the benefit, in their case against A&P, of Board orders directing Steinberg to produce documents and witnesses which would not have occurred had the matters been considered separately. Counsel asserted the Board should neither sever the instant proceedings nor grant to the individual complainants and the Teamsters leave to withdraw against Steinberg. Counsel also noted that, since A&P would be seeking indemnification against Steinberg on the basis of their contract if A&P was found in breach of the Labour Relations Act, that prospect provided a further reason for staying the present proceedings in their entirety. Cases cited in support included: Meridian Developments Inc. v. Toronto Dominion Bank (1984), 1984 CanLII 1176 (AB QB), 52 C.B.R. 109 (Alta. Q.B.); Hong Kong Bank v. Chef Ready Foods (1990), 4 C.B.R. (3d) 307 (B.C.S.C.), affd 1990 CanLII 529 (BC CA), [1991] 2 W.W.R. 136 (B.C.C.A.); Quintette Coal Limited v. Nippon Steel Corporation et al (1990), 47 B.C.L.R. (2d) 193 (B.C.S.C.), aff'd (1990), 1990 CanLII 430 (BC CA), 51 B.C.L.R. (2d) 105 (B.C.C.A.); leave to appeal to S.C.C. refused (1991), 7 C.B.R. (3d) 164; Norcen Energy Resources Ltd. et al v. Oakwood Petroleums Ltd. (1988), 1988 CanLII 3560 (AB QB), 72 C.B.R. 1 (Alta. Q.B.); Ptarmigan Airways Ltd. v. Federated Mining Corporation, 1973 CanLII 1652 (NWT SC), [1973] 3 W.W.R. 723; Re Philip's Manufacturing Ltd. (unreported, B.C.S.C., October 17, 1991); Dunn v. The Board of Education for the City of Toronto, [1904] 7 O.L.R. 451; Reference Re: The Companies' Creditors Arrangement Act, (1934), 1934 CanLII 72 (SCC), 16C.B.R. 1 (S.C.C.).

5. Counsel for the Teamsters submitted that the Board had the jurisdiction and the responsibility to interpret the ambit of the C.C.A.A. and the court order. Given the remedial purpose of the C.C.A.A., it was argued that the C.C.A.A. and the order which mirrored and was a product of the statute did not have any impact on the Board proceedings in the instant case. Counsel did not disagree that the courts have interpreted the term "proceeding" broadly but contended that definition is limited to the commercial context. That is, the cases cited have concerned situations where to grant the leave requested - whether by creditor or other non-creditor in a judicial or other proceeding - would have the effect of putting the protected company out of business (at least for practical purposes) or would give the claimant an advantage over others vis-a-vis the protected company's assets. The Board was free, it was asserted, to interpret the C.C.A.A. and the court order in the context of this specific fact situation including the remedial nature and purpose of the Labour Relations Act. In counsel's view, the purpose of the C.C.A.A. would not be undermined by continuing with the instant Board proceedings unless and until the Board ordered monetary relief for a breach of the Labour Relations Act and the parties sought execution or enforcement of the Board order. Counsel also asserted that the Board may well have a discretion as to whether to proceed and the balance of convenience in the circumstances favoured continuing with the instant case rather than requiring the individual complainants and the Teamsters to appear before the Judge in Quebec who issued the order to seek a modification of the stay order. Counsel distinguished those cases referred to by counsel for Steinberg and for A&P on the ground that the jurisprudence was confined to the commercial context, as noted. In the alternative, counsel argued that any stay should operate only as against Steinberg. The matter should continue against A&P as that company was not entitled to protection under the C.C.A.A. and should not benefit from an order granted to Steinberg under that Act. Counsel acknowledged that a stay only with respect to Steinberg might create practical problems as to the manner of proceeding but such difficulties, it was suggested, were not insurmountable. In that regard, counsel submitted that there was no remedy claimed in the section 64 application against Steinberg and, therefore, no prejudice to Steinberg in proceeding against A&P. And, the section 91 complaints against Steinberg could be severed and heard following the expiration of the stay. In the further alternative, counsel submitted that the individual complainants and the Teamsters had the right to withdraw against Steinberg and, should such a leave be requested of the Board, that should be granted. Cases cited: Guardian Trust Co. v. Gaglardi (1989), 1989 CanLII 5211 (BC SC), 64 D.L.R. (4th) 351 (B.C.S.C.); Fine's Flowers Ltd. v. Fine's Flowers Ltd. (Creditors) (1992), 1992 CanLII 7737 (ON CTGD), 87 D.L.R. (4th) 391 (Ont. S.C.); Roy Brandon Construction, [1981] OLRB Rep. Feb. 219.

6. Counsel for the individual complainants submitted that the term "proceedings" is ambiguous and that ambiguity should be resolved in a manner which advanced the statutory objectives of the C.C.A.A.. Counsel added that, in the current economic times, it was likely that resort to the C.C.A.A. would be more frequent and, accordingly, it was important for the Board to decide the impact of the C.C.A.A. on Board proceedings. The submissions of counsel for the Teamsters regarding the purpose and interpretation of the C.C.A.A. were adopted. Further, it was asserted that, given the underlying statutory purpose, the instant Board proceedings were not caught by the court order. Counsel ordered that the caselaw wherein the C.C.A.A. was interpreted broadly was confined to the commercial context and, further, that the Board proceedings could continue at least until the parties sought enforcement of a Board order directing monetary relief against Steinberg. Counsel quite properly brought two cases to the attention of the Board which did not support his position but argued both were both distinguishable and/or should not be followed as the courts therein did not expressly address the competing policy concerns of the Labour Relations Act or the arguments raised herein were not apparently made before those courts. (International Woodworkers of America, Local 1-324 v. Wescana Inn Ltd. and Clarkson Company Limited (1977), 27 Can. Bankruptcy Reports 201 (M.C.A.); Paul Bertrand and Line Gagnon, [1980] 3 Can. LRBR 316). It was argued that the Board should take into consideration the expense and difficulties associated with requiring the individual complainants and the Teamsters to seek a modification of the stay order before the Quebec court. The contempt issue was irrelevant to the Board's assessment. In the alternative, if the Board concluded the term "proceedings" could apply to the Board hearings, nonetheless the Board should interpret the C.C.A.A. as not applicable herein given the context of the material filed in support of Steinberg's ex parte application to the court which did not refer to the complainants herein nor disclose the instant proceedings. That is, it was argued that Steinberg did not intend and the Judge could not have intended the instant proceeding to be caught by the stay order. In the circumstances, and given the absence of any specific reference to the instant proceeding in the stay, counsel submitted that Steinberg bore an onus of demonstrating to the Board that this proceeding was intended to be caught and had not satisfied that onus. Counsel adopted the submissions of counsel for the Teamsters with respect to the right of the complainants to withdraw as against Steinberg and that A&P was not entitled to any protection under the C.C.A.A. nor should it benefit from the stay order. In effect, in the further alternative, the Board could continue the hearing as against A&P and stay the proceedings against Steinberg until the stay order expired. Also referred to: Guaranty Trust Co. (1947), 47 CLLC ¶16,500.

7. In reply, counsel for A&P submitted that the term "proceedings" was not ambiguous but, rather, had been interpreted broadly by the courts. It was submitted that there was no basis in the wording of the statute or the court order for the Board to proceed to conclude the case and stop only at the point of execution of the remedy if a breach of the Labour Relations Act was found and relief ordered. Nor should any weight be given, counsel argued, to any potential procedural or practical difficulties faced by the individual complainants and the Teamsters in seeking a variation of the court order. That is, the question is one of interpretation of the order and the C.C.A.A., not expediency, and with respect to that question of interpretation, there was no issue of onus. Counsel also commented on several cases cited by counsel for the complainants and/or counsel for the Teamsters, submitting that the cases did not support the conclusion that the Board could proceed in the instant matter.

8. In reply, counsel for Steinberg agreed with counsel for A&P that the question was one of interpretation to which no onus attached to any party and that the C.C.A.A., the court order and caselaw draw no distinction between proceedings to establish liability and enforcement or execution. With respect to whether the Board could proceed as against A&P alone, counsel submitted that to do so would be improper, given the requirements of procedural fairness, unless the complaints against Steinberg were entirely withdrawn and it was clear that no relief was sought against Steinberg in the section 64 application. That is, in the context of the pleadings as drafted, counsel submitted that Steinberg was entitled to participate in a proceeding against A&P if there was any prospect that proceedings against Steinberg could be reactivated. Should there be a withdrawal of the complaints against Steinberg and clarification that no relief was sought against Steinberg in the section 64 application, counsel made no submissions with respect to whether the Board should proceed against A&P alone.

9. It is appropriate to begin the Board's analysis by setting out the relevant sections of the C.C.A.A. and the court order issued with respect to Steinberg, the petitioner under the C.C.A.A. and one of the respondents in the Board proceeding.

C.C.A.A.

11. Notwithstanding anything in the Bankruptcy Act or the Winding-up Act, whenever an application has been made under this Act in respect of any company, the court, on the application of any person interested in the matter, may, on notice to any other person or without notice as it may see fit.

(a) make an order staying, until such time as the court may prescribe or until any further order, all proceedings taken or that might be taken in respect of the company under the Bankruptcy Act and the Winding-up Act or either of them;

(b) restrain further proceedings in any action, suit or proceeding against the company on such terms as the court sees fit; and

(c) make an order that no suit, action or other proceeding shall be proceeded with or commenced against the company except with the leave of the court and subject to such terms as the court imposes. R.S., c. C-25, s.11.

16. Every order made by the court in any province in the exercise of jurisdiction conferred by this Act in respect of any compromise or arrangement shall have full force and effect in all the other provinces and shall be enforced in the court of each of the other provinces in the same manner in all respects as if the order had been made by the court enforcing it. R.S., c. C-25, s.16.

17. All courts that have jurisdiction under this Act and the officers of those courts shall act in aid of and be auxiliary to each other in all matters provided for in this Act, and an order of a court seeking aid with a request to another court shall be deemed sufficient to enable the latter court to exercise in regard to the matters directed by the order such jurisdiction as either the court that made the request or the court to which the request is made could exercise in regard to similar matters within their respective jurisdictions. R.S., c. C-25, s.17.

COURT ORDER (English translation)

14. SUSPEND all the proceedings instituted or that may be instituted against the Petitioner pursuant to any law of general application, contract, agreement or accord of any nature, as well as any proceedings pursuant to the Bankruptcy Act and the Winding-up Act or one or the other of these acts, until the sanction of the final plan of arrangement or until a new Order of the Court or with leave of the Court, upon a motion to such effect, served on the Petitioner, in the care of its attorneys, Langlois Robert, and including a notice of presentation providing at least two (2) clear legal days notice, and under the conditions that the Court may impose, the whole until a new Order of the Court in the matter;

15. RESTRAIN any further proceedings in any action, suit or proceeding already instituted against the Petitioner under such conditions as may be deemed opportune by the Court or with leave of the Court upon a motion to such effect, served on the Petitioner, in the care of its attorneys, Langlois Robert, and including a notice of presentation providing at least two (2) clear legal days notice, and under the conditions that the Court may impose, the whole until a new Order of the Court in the matter;

16. ORDER that no action, suit or other proceedings be proceeded with or commenced by anyone against the Petitioner, except with leave of the Court, upon a motion to such effect, served on the Petitioner, in the care of its attorney, Langois Robert, and including a notice of presentation providing at least two (2) clear legal days notice and subject to such conditions as the Court may impose, the whole until a new Order of the Court in the matter;

17. There was no dispute that the Board has the jurisdiction to interpret the C.C.A.A. and the court order in the context of their impact on the instant proceeding. It was also acknowledged that the C.C.A.A. is valid federal legislation under section 91(21) of the Constitution Act (Reference Re: The Companies' Creditors Arrangement Act, supra). A useful exposition of the approach of the judiciary to the interpretation of the C.C.A.A. is found in Quintette Coal Ltd., supra, at pp 109-111 and 112-113, wherein the British Columbia Court of Appeal sketches the historical setting of the C.C.A.A. as well:

The starting point in the construction exercise is an understanding of the historical setting of the C.C.A.A. to the end that s. 11 is read in such a manner as to achieve the object of Parliament. Maxwell speaks of the historical setting as an aid to construction at pp. 47 and 48:

"The Court" said Sir George Jessel M.R., "is not to be an oblivious.., of the history of law and legislation. Although the Court is not at liberty to construe an Act of Parliament by the motives which influenced the Legislature, yet when the history of law and legislation tells the Court, and prior judgements tell this present Court, what the object of the Legislature was, the Court is to see whether the terms of the section are such as fairly to carry out that object and no other, and to read the section with a view to finding out what it means, and not with a view to extending it to something that was not intended." In the interpretation of statutes, the interpreter may call to his aid all those external or historical facts which are necessary for comprehension of the subject-matter, and may also consider whether a statute was intended to alter the law or to leave it exactly where it stood before. But although "we can have in mind the circumstances when the Act was passed and the mischief which then existed so far as these are common knowledge... we can only use these matters as an aid to the construction of the words which Parliament has used. We cannot encroach on its legislative function by reading in some limitation which we may think was probably intended but which cannot be inferred from the words of the Act."

In Chef Ready Foods Ltd. v. Hongkong Bank of Can., Vancouver No. CA12944, judgement handed down on 29th October 1990 (now reported ante, p.84], another division of this court reviewed the historic background of the C.C.A.A. saying, at pp. 10 and 11 [p.91]:

The C.C.A.A. was enacted by Parliament in 1933 when the nation and the world were in the grip of an economic depression. When a company became insolvent liquidation followed because that was the consequence of the only insolvency legislation which then existed - the Bankruptcy Act and the Winding-up Act. Almost inevitably liquidation destroyed the shareholders' investment, yielded little by way of recovery to the creditors, and exacerbated the social evil of devastating levels of unemployment. The government of the day sought, through the C.C.A.A. to create a regime whereby the principles of the company and the creditors could be brought together under the supervision of the court to attempt a reorganization or compromise or arrangement under which the company could continue in business.

The court then quoted excerpts from an article by Stanley Edwards (1947), 25 Can. Bar. Rev. 587, entitled "Reorganizations Under the Companies' Creditors Arrangement Act" which, it said, "explain very well the historic and continuing purposes of the Act" [pp.91-92]:

"It is important in applying the C.C.A.A. to keep in mind its purpose and several fundamental principles which may serve to accomplish that purpose. Its object, as one Ontario judge has stated in a number of cases, is to keep a company going despite insolvency. Hon. C.H. Cahan when he introduced the bill into the House of Commons indicated that it was designed to permit a corporation, through reorganization, to continue its business, and thereby to prevent its organization being disrupted and its goodwill lost. It may be that the main value of the assets of a company is derived from their being fitted together into one system and that individually they are worth little. The trade connections associated with the system and held by the management may also be valuable. In the case of a large company it is probable that no buyer can be found who would be able and willing to buy the enterprise as a whole and pay its going concern value. The alternative to reorganization then is often a sale of the property piecemeal for an amount which would yield little satisfaction to the creditors and none at all to the shareholders."

Page 590:

"There are a number of conditions and tendencies in this country which underline the importance of this statute. There has been over the last few years a rapid and continuous growth of industry, primarily manufacturing. The tendency here, as in other expanding private enterprise countries, is for the average size of corporations to increase faster than the number of them, and for much of the new wealth to be concentrated in the hands of existing companies or their successors. The results of committing dissolutions of companies without giving the parties an adequate opportunity to reorganize them would therefore likely be more serious in the future than they have been in the past."

"Because of the country's relatively small population, however, Canadian industry is and will probably continue to be very much dependent on world markets and consequently vulnerable to world depressions. If there should be such a depression it will become particularly important that an adequate reorganization procedure should be in existence, so that the Canadian economy will not be permanently injured by discontinuance of its industries, so that whatever going concern value the insolvent companies have will not be lost through dismemberment and sale of their assets, so that their employees will not be thrown out of work, and so that large numbers of investors will not be deprived of their claims and their opportunity to share in the fruits of the future activities of the corporations. While we hope that this dismal prospect will not materialize, it is nevertheless a possibility which must be recognized. But whether it does or not, the growing importance of large companies in Canada will make it important that adequate provision be made for reorganization of insolvent corporations.

The other aid to construction which is appropriate here is the view other courts have taken of 5. 11. Maxwell at p.47 (see above) quotes Sir George Jessel M.R. as saying, inter alia:

“…when.., prior judgements tell this present Court, what the object of the Legislature was, the Court is to see whether the terms of the section are such as fairly to carry out that object and no other, and to read the section with a view to finding out what it means, and not with a view to extending it to something that was not intended."

Considering that the C.C.A.A. was enacted some 57 years ago there are relatively few reported cases interpreting its provisions. That may be a reflection of the general level of prosperity, with some short term reverses ,which has been the Canadian experience for the past 50-plus years. In any event, and whatever the reason, the reported cases indicate that the courts have tended to avoid microscopic parsing of the words and phrases of s. 11 in favour of a broader "purposes" perspective thereby reaching conclusions held to further the objectives of Parliament. Without so stating they have given full effect to the direction in s. 12 of the Interpretation Act, R.S.C. 1985, c. 1-21:

12. Every enactment is deemed remedial, and shall be given such fair, large and liberal construction and interpretation as best ensures the attainment of its objects.

The following cases are illustrative of the kind of conduct the courts have found to be within their power to restrain under s. 11: Re Feifer and Frame Mfg. Corp., [1947] Que. K.B. 348, 28 C.B.R. 124 (C.A.); Wynden Can. inc. v. Gaz Metropolitain Inc. (1982), 44 C.B.R. (N.S.) 285 (Que. S.C.); Norcen Energy Resources Ltd. v. Oakwood Petroleums Ltd. (1988), 1988 CanLII 3560 (AB QB), 63 Alta. L.R. (2d) 361, 72 C.B.R. (N.S.) 1, 92 AR. 81 (Q.B). The judgements also contain helpful and persuasive observations about the intent and purpose of the Act, as do the following judgments: Meridian Dev. Inc. v. T.D. Bank; Meridian Dev. Inc. v. Nu-West Ltd., 1984 CanLII 1176 (AB QB), [1984] 5 W.W.R. 215, 32 Alta. L.R. (2d) 150, 52 C.B.R. (N.S.) 109, 11 D.L.R. (4th) 576, 53 AR. 39 (Q.B.); Re Ursel Invt. Ltd., Sask. Q.B., 1990 (not yet reported); and Northland Properties Ltd. v. Excelsior Life Ins. Co. of Can., 1989 CanLII 2672 (BC CA), 34 B.C.L.R. (2d) 122, (1989] 3 W.W.R. 363, 73 C.B.R. (N.S.) 195 (CA.). And in his judgement in this case Thackray I. adopted the approach followed in Meridian and Norcen. There is a perceptive observation about the attitude of the courts at the end of the case comment following the C.B.R. report of Norcen:

The Norcen decision is one of the strongest examples to date of the willingness of the courts to permit the C.C.A.A. to be used as a practical and effective way of restructuring corporate indebtedness.

By way of brief summary, the subject matter of each of the judgments which has a direct bearing on the scope of s. 11 is as follows: in Feifer and Frame, a notice of eviction by the landlord; in Wynden Can., cessation of utility services; in Meridian, a letter of credit; in Norcen, a replacement of the operator under an oil and gas operating agreement.

To the extent that a general principle can be extracted from the few cases directly on point, and the others in which there is persuasive obiter, it would appear to be that the courts have concluded that under s. 11 there is a discretionary power to restrain judicial or extra judicial conduct against the debtor company the effect of which is, or would be, seriously to impair the ability of the debtor company to continue in business during the compromise or arrangement negotiating period. The power is discretionary and therefore to be exercised judicially.

11. There was no dispute, as well, that the jurisprudence sustains a broad interpretation of the word "proceedings" in section 11: see Meridian Developments, supra at pp 113-114 and 117-118 and Chef Ready Foods, supra at pp 140 and 142-144 where the courts therein comment on the purpose and wide ambit of the C.C.A.A. in various contexts. A few examples will suffice herein. Stay orders under the C.C.A.A. have restrained extra-judicial conduct including a set-off (Quintette, supra). The courts have not restricted the orders issued pursuant to the C.C.A.A. to creditors: Norcen Energy Resources, supra. A landlord was not permitted to rely on an eviction clause where a debtor tenant obtained protection under the C.C.A.A.: Re Feifer and Frame Mfg. Corp., 28 C.B.R. 124, [1947] Que. K.B. 348 (C.A.). Parties seeking to rely on statutory rights have likewise been precluded from continuing or instituting an action or proceeding in the face of a stay order under the C.C.A.A.: Vachon v. Can. Employment & Immigration Comm.,1985 CanLII 12 (SCC), [1985] 2 S.C.R. 417, 57 C.B.R. (N.S.) 113, 23 D.L.R. (4th)) 641, 63 N.R. 81; Ptarmigan Airways, supra; Re Chef Ready Foods, supra.

12. This is the first instance where the issue of the applicability to Board proceedings of the C.C.A.A. and a stay order issued thereunder has been squarely raised. The reasoning in Guaranty Trust Co., supra, is not of assistance given the precise wording of the order at issue therein. Nor did the Board have to deal directly with a similar statute, the Bankruptcy Act, R.S.C. 1970, c. B-3, in the circumstances in Roy Brandon Construction, supra. In Chandelle Fashions Ltd., [1981] OLRB Rep. Sept. 1191, the Board, having already found a breach of the Labour Relations Act, quantified that liability in the face of a stay order under the Bankruptcy Act. The Board distinguished between the decision to quantify the liability and the ability of employees to execute or enforce the Board's order. However, as that decision expressly notes, no one appeared on behalf of the trustees in bankruptcy to address the issues or direct the Board's attention to any judicial authority as to whether the quantification of liability itself was restrained by the stay order. Those cases, then, are not of assistance to the Board in determining the question of the ambit of the C.C.A.A. and the stay order.

13. Counsel for the individual complainants and for the Teamsters urged the Board to find that the purpose of the C.C.A.A. was to preserve a company's assets and operating ability in the commercial context and to interpret the term "proceedings" in that context so as to conclude that the C.C.A.A. and the stay order have no applicability to the instant proceedings. Notwithstanding their eloquent submissions, the Board is not persuaded of the correctness of that conclusion. In the Board's view, the language of the C.C.A.A. and the stay order does encompass, on its face, the Board's adjudicative process. This is so notwithstanding the remedial nature of the Labour Relations Act, the importance and uniqueness of the rights created under that Act and the Board's role in ensuring those rights are upheld in furtherance of the statutory objectives. To find otherwise, would be to do violence to the wording of the C.C.A.A. and the stay order. The broad interpretation consistently accorded the C.C.A.A. by the courts further sustains the Board's determination in this regard. Nor does the Board agree that the wording of the C.C.A.A. and the stay order admit of a distinction between continuation of proceedings with respect to establishing liability and subsequent enforcement or execution of remedial orders. While such a distinction has some attractiveness, the Board does not regard that proposition as sustainable in the face of the language of the C.C.A.A. and the stay order and the jurisprudence.

14. Beyond the judicial references already discussed, there are two instances properly brought to the Board's attention by counsel for the individual complainants which constitute additional support for the Board's conclusion that the instant proceedings are caught by the stay order. In International Woodworkers of America, Local 1-234 and Wescana Inn Ltd. and Clarkson Company Limited, supra, the Manitoba Court of Appeal expressly held that the term "proceedings" in the receivership order embraces a proceeding before the Manitoba Labour Board to obtain certification (at p 206). The differences between the matter before the Court of Appeal and the Manitoba Labour Board and the instant proceedings are not material. While not legally binding, the reasoning of the Manitoba Court of Appeal is compelling and buttresses a conclusion in this case that the stay order issued under the C.C.A.A. restrains these proceedings (see also Paul Bertrand, supra).

15. It is the conclusion of the Board that the individual complainants and the Teamsters must be content to have the proceedings await the expiration of the stay order or must seek a variation of that order to permit the instant proceedings to continue as presently constituted. In that regard, the Board notes the acknowledgement by counsel for Steinberg that these proceedings were not disclosed to the court issuing the ex parte order nor referred to in the materials filed by Steinberg in support of the application under the C.C.A.A.. The duty to make full and frank disclosure of all material facts in seeking an ex parte order was noted by counsel for the individual complainants: see also Philip's Manufacturing Ltd. supra. It was asserted that Steinberg either did not intend the Board proceedings to be caught by the stay order or concealed the existence of the instant complaint and the stage the proceedings had reached. The Board need not decide if either proposition is correct although the Board is troubled by the lack of disclosure. Nonetheless, the language of the C.C.A.A. and the court order and the jurisprudence have led the Board to conclude that these proceedings are embraced by the order. Steinberg's position is that, notwithstanding the lack of disclosure in the ex parte application, the Board proceedings are caught by the stay order, the individual complainants and the Teamsters must seek a variation in the order in the Quebec courts (before the Judge issuing the original order) and any modification in the order to permit these proceedings to continue will be opposed. Those matters are ultimately for the court to consider if the individual complainants and the Teamsters do seek such a variation.

16. In reaching its decision, it is unnecessary for the Board to determine whether a variation in the stay order must be brought before the Judge who issued the original order or simply before the same court in Quebec, nor is the Board commenting on whether the individual complainants and the Teamsters could seek a variation of the stay order before the Ontario courts given the provisions of sections 16 and 17 of the C.C.A.A. Those are matters for the parties to assess and for the courts to decide.

17. The Board then turns to the question of whether the proceedings may be severed so as to permit the continuation of the application and complaints against the respondent A&P. The respondent A&P is not entitled to protection under the C.C.A.A.: Guardian Trust Co., sup ra. Nor should proceedings be stayed as against Steinberg on the basis that A&P would seek indemnification from Steinberg on their contract should A&P be found to have breached the Labour Relations Act: Meridian Developments Inc., supra. Whether the allegations against A&P should be stayed because of the manner in which the complaints/applications have proceeded thus far is more .problematic. The Board determined at the commencement of the case that, given the overlap in evidence and the nature of the allegations against Steinberg and A&P, it would be most expeditious and appropriate to hear all matters together. At the point the stay order issued, the Board had yet to hear from two witnesses on behalf of the individual complainants. It appeared likely that the Teamsters would not be calling any witnesses. That would leave reply evidence, if any, by A&P and Steinberg respectively and submissions from all parties on all issues. In the Board's view, it is not possible to disentangle the proceedings to permit the matter to continue against A&P and to be stayed against Steinberg with the prospect of resurrecting the case against Steinberg when the court ordered stay is lifted or varied to exclude the instant case from its ambit. Counsel for the individual complainants and the Teamsters acknowledged that there would be practical difficulties in so severing the proceedings but argued those difficulties were not insurmountable. The Board does not agree given the manner in which the allegations in the section 91 complaint against Steinberg have been framed and the dictates of natural justice. In the Board's opinion, the case against A&P can continue (absent a variation in the court order excluding the instant proceeding entirely from the reach of the order) only if the individual complainants and the Teamsters together withdraw their section 91 complaints against Steinberg and stipulate that no relief against Steinberg is sought in the section 64 application. In this regard, the Board notes that, while the applications as initially filed included a reference to section 1(4) of the Labour Relations Act, that aspect was not the subject of submissions and has apparently not been pursued.

18. Counsel for A&P submitted that the Board should not grant such leave to withdraw, if so requested, because those parties had the benefit of Board orders against Steinberg with respect to production of documents and witnesses. That evidence, it was asserted, would otherwise not have been available to those parties except through their own witnesses and, hence, without the freedom to cross-examine Steinberg's witnesses. The Board does not regard that argument as compelling. The Board certainly has the discretion whether to grant leave to a party seeking to withdraw all or part of a complaint or application. The Board has only in the rarest of instances refused such leave. Moreover, there is nothing to suggest the allegations against Steinberg were frivolous or were initiated in order to obtain a tactical advantage in the complaints against A&P. Given the Board's various conclusions regarding the reach of the stay order and the manner in which the case has proceeded to date, the individual complainants and the Teamsters are now faced with a strategic decision. Should both seek leave to withdraw the section 91 allegations against Steinberg and confirm that no relief against Steinberg is sought in the section 64 application, the Board would not refuse such leave.

19. To summarize, for the reasons given, the Board finds that the court order issued pursuant to the C.C.A.A. does stay the instant proceedings against Steinberg. Further, again for the reasons given, the individual complainants and the Teamsters have the following options:

(a) to await the expiration of the stay order; or

(b) to obtain a modification of the stay order to permit these proceedings to continue as presently constituted; or

(c) to withdraw the complaints pursuant to section 91 of the Labour Relations Act against the respondent Steinberg and confirm that, in the section 64 application, there is no relief sought against the respondent Steinberg.

Unless a variation in the stay order of the court is granted, as noted, or unless both the individual complainants and the Teamsters elect option (c) (in which case the Board proceedings will continue against the respondent A&P), the Board shall adjourn the instant case until the expiration of the court order. A number of dates have been set for continuation of this matter. Whether the hearing will reconvene on some or all of the dates set will depend upon the decision of the individual complainants and the Teamsters and, if sought, whether a variation in the court order stay is granted. Counsel for the Teamsters and for the individual complainants are directed to inform the Board in writing as soon as possible with respect to whether some or all of the dates set should be cancelled and/or whether new continuation dates are needed.

20. This matter is referred to the Registrar in accordance with the foregoing.