Drywall Acoustic Lathing and Insulation Local 675 v. 737049 Ontario Ltd. o/a D'Luxe Drywall (1987), 1995 CanLII 10049

[1995] OLRB Rep. February 112

0759-94-G; 1108-94-G; 1109-94-G; 111O-94-R Drywall Acoustic Lathing and Insulation Local 675, Applicant v. 737049 Ontario Ltd. o/a D'Luxe Drywall (1987), Responding Party; Drywall Acoustic Lathing and Insulation Local 675, Applicant v. Battlefield Drywall Inc. and 737049 Ontario Ltd. c.o.b. as D'Luxe Drywall (1987), Responding Parties.

BEFORE: G. T. Surdykowski, Vice-Chair, and Board Members F. B. Reaume and G. McMenemy.

DECISION OF THE BOARD; February 27, 1995

1. Board File Nos. 0759-94-G, 1108-94-G and 1109-94-G are referrals to the Board of grievances in the construction industry, under section 126 of the Labour Relations Act. Board File No. 1110-94-R is an application for relief under sections 1(4) (related or single employer) and 64 (sale of business or successor employer) of the Act. They appeared to be related.

2. The last of these applications was filed on June 29, 1994. It is not apparent what if anything has happened in any of them since mid-July 1994.

3. By letter dated February 23, 1995, the applicant trade union requests that the applications all be scheduled for hearing, and that the Board issue a pre-hearing production order. More specifically, the applicant seeks an order that the responding employers produce documents as follows:

A. ORDERS REQUESTED

1. An order that the Respondents produce by March 15, 1995, to the applicant and to the Board all documents pertaining to the corporate and business structure of D'Luxe and Battlefield. Without limiting the generality of the foregoing, all Corporate Minutes, By-Laws, Articles of Incorporation, Directors' Resolutions, Shareholder Resolutions, Shareholder Agreements, Directors' Registers, Shareholder Registers, Officers' Registers, Share Transfer Registers, Share Certificates, filings with the Minister of Consumer and Commercial Relations pursuant to the Corporation Information Act, and any other agreements or notes reflecting agreements between any of the Shareholders, Officers or Directors of the respondents.

2. An order. that the Respondents produce by March 15, 1995, to the applicant and the Board all documents pertaining to any commercial transactions between D'Luxe and Battlefield. Without limiting the generality of the foregoing, all agreements, purchase orders, contracts, subcontracts, leases, securities and guarantees between the respondents and all agreements, contracts, subcontracts, leases and guarantees entered into jointly by the responding parties.

3. An order that the Respondents produce by March 15, 1995, any documents indicating a disposition by any mode whatsoever of the business assets, goods, receivables, leases, or equipment of D'Luxe and Battlefield.

4. An order that the Respondents produce by March 15, 1995, a list of the following:

(a) premises owned, leased or occupies by each Respondent;

(b) equipment owned, leased or used by each Respondent;

(c) payroll records for the last five years by each Respondent;

(d) a copy of all business cards issued by each Respondent;

(e) name of accountant and bookkeeper for each Respondent;

(f) name of solicitor for each Respondent;

(g) customer list for each Respondent;

(h) phone and fax numbers used by each Respondent;

(i) all persons with authority to sign cheques on behalf of each Respondent;

(j) all signs indicating associated existence; and

(k) all shared office equipment and sales personnel.

5. An order that the Respondents provide by March 15, 1995, all documents they intend to rely on at the hearing.

6. Sections 1(4), 1(5), 64(1), 64(1).1, 64(2) and 64(13) provide that:

1(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.

(5) Where, in an application made pursuant to subsection (4), it is alleged that more than one corporation, individual, firm, syndicate or association or any combination thereof are or were under common control or direction, the respondents to the application shall adduce at the hearing all facts within their knowledge that are material to the allegation.

64(1) In this section,

"business" includes one or more parts of a business; ("entreprise")

"predecessor employer" means an employer who sells his, her or its business; ("employeur precedent")

"sells" includes leases, transfers and any other manner of disposition; ("vend")

"successor employer" means an employer to whom the predecessor employer sells the business. ("employeur qui succede")

(1.1) This section applies when a predecessor employer sells a business to a successor employer.

(2) If the predecessor employer is bound by a collective agreement, the successor employer is bound by it as if the successor employer were the predecessor employer, until the Board declares otherwise.

(13) Where, on an application under this section, a trade union alleges that the sale of a business has occurred, the respondents to the application shall adduce at the hearing all facts within their knowledge that are material to the allegation.

5. Under the Labour Relations Act, the Board is empowered to determine its own practice and procedure, and make rules in that respect, and to make pre-hearing production orders (sections 104(13) and 13.1, and 105(2)(a.1). Rule 15 of the Board's Rules of Procedure stipulates that each party to a Board proceeding must file with the Board and deliver to each other party copies of all documents upon which it intends to rely in the proceeding. Further, although neither the Board's Rules, nor effective case management require the kind of elaborate pleadings, pre-hearing discovery, or disclosure typical in civil proceedings, applications under sections 1(4) and 64 of the Act are among those cases in which there is often significant benefit derived from pre-hearing disclosure.

6. Sections 1(4) and 64 of the Labour Relations Act deal with the labour relations consequences or ramifications of business relationships or transactions. Both provisions operate to modify common-law notions of separation between corporate or other economic entities, and privity of contract. Pre-hearing disclosure is often particularly helpful in such cases because they often turn on an assessment of commercial facts which are not substantially in dispute. Accordingly, detailed pleadings and pre-hearing disclosure enable the parties to identify and join issue on the factual legal issues between them, and allows that parties to assess their respective positions. It also tends to make estimates of the hearing time which will be required to deal with an application more reliable and allows for more effective case management by both the Board and the parties.

7. In this case, the responses filed by the responding employer is rather sparse. Neither the responding employer appears to have filed any documents.

8. It appears that many of the documents which the applicant seeks to have produced are typically produced and relevant in such proceedings. However, part of the applicant's request appears to require that the responding employers create as well as produce documents. While the information which would be revealed in that respect may well be relevant to a proper consideration of the application under sections 1(4) and 64, any obligation to produce documents, whether arising out of a Board order or otherwise, does not include an obligation to create documents which do not exist (although it may well be helpful if the information itself is provided).

9. We note that in Shaw-Almex Industries Limited, [1984] OLRB Rep. Apr. 659, the Board considered the effect of the issuance and enforcement over summons duces tecum and the protection to a party which produce documents in response thereto. In that latter respect, the Board concluded that there is an implied undertaking by a party to which documents are produced in a Board proceeding that such documents will not be used for any collateral or ulterior purpose; that is, for a purpose unrelated to the proceeding in which the documents are produced. In arriving at that conclusion, the Board in Shaw-Almex Limited, supra, applied the English law on the issue.

10. Recently, in Goodman and Rossi, (1995) 25 OR. (3d) 112 (Application for Leave to Appeal to the Court of Appeal for Ontario filed December 9,1994), the Ontario Court (General Division), Divisional Court held that the law of Ontario does not impose an implied undertaking by a party to which information or documents are provided in an examination for discovery or through production of documents that it will not use that information for any collateral or ulterior purpose. In doing so, the Board specifically declined to apply some of the vary English decisions on which the Board relied in Shaw-Almex, supra.

11. Nevertheless, we agree with Moldaver J. in Goodman v. Rossi, supra, that there should be such an implied undertaking, although perhaps modified to suit its purpose. That is, there should not be an implied undertaking with respect to information which can be obtained legitimately outside of the litigation process, but that the use of private information obtained solely through the litigation process should be restricted to the litigation in which the information is revealed, subject to exceptions which are properly developed according to the circumstances of individual cases.

12. Having said all of this, the Registrar is directed to send a copy of the applicant's February 23, 1995 letter to the responding employers (which the applicant appears not to have done). The responding employers have ten days from the date hereof to make written submissions with respect to the applicant's pre-hearing production request, failing which the Board will deal with the request on the basis of the materials and submissions then before it.