[1996] OLRB REP. JANUARY
3401-95-R Law Development Group, Applicant v. Carpenters and Allied Workers Local 27, United Brotherhood of Carpenters and Joiners of America, Responding Party
BEFORE: M. A. Nairn, Vice-Chair, and Board Members W. H. Wightman and P. V. Grasso.
APPEARANCES: Joseph Liberman, Adrian Miedema and Richard Law for the applicant; David
Watson, Walter Tracogna and Ucal Powell for the responding party.
DECISION OF THE BOARD; January 25, 1996
This is an application under section 64 of the Labour Relations Act, 1995 seeking to terminate the bargaining rights of the responding party. The applicant ("Law" or the "employer") alleges that the certificate obtained by the responding party (the "trade union") was obtained by fraud.
We heard a number of preliminary objections. We ruled orally that, regardless of the other matters raised, we were not satisfied that the allegations set out in the application, even if true and provable, were facts from which we would infer a fraud as contemplated by that term in section 64 and we dismissed the application. These are our reasons.
The trade union applied to be certified in June, 1995. By decision dated July 12, 1995 the trade union was certified for a bargaining unit in the construction industry; both ICI and nonICI in Board Area 8. That decision notes that the employer did not respond to the application.
By letter dated July 24, 1995, the employer sought reconsideration of the decision certifying the trade union on the basis that it did not receive notice of the application, did not employ carpenters on the application date, and was also therefore not the proper named responding party. A hearing was convened and a decision issued finding that the employer had received notice of the application but had not acted to respond to it. That panel noted that there was nothing being raised which could not have been raised before, and in light of the finding on notice, the reconsideration request was dismissed.
The fraud alleged in this application is the assertion that the trade union filed membership evidence on behalf of employees that it knew were not employees of Law. The trade union asserts that this is no more than the question of who is the proper employer; an issue that is often raised and dealt with in the context of a certification application, particularly in the construction industry. Although Law attempted to distinguish these as separate issues, we see no difference. Membership evidence itself is not employer specific. We note there was no dispute that there were carpenters performing work on Law's jobsite on the date of application, or that the membership evidence filed represented an expression of the wishes of employees to be represented by the trade union. The dispute is whether or not Law was the employer of those employees.
In the application for certification the trade union identified Law Development Group as the employer of the employees on whose behalf it had filed evidence of membership. It was pleaded on the face of the application. The trade union also provided the Board with the necessary information with which to serve the application on Law. As noted in the decision dismissing the request for reconsideration it was not disputed by Law that notice of the application was received. One of its Vice-Presidents caused the notice to employees to be posted on the job site. He testified that he did not realize that the application was in respect of Law, although we note that even the notice to employees references Law both as the responding party to the certification application and as the employer of employees affected.
We accept the trade union's argument that the adversarial process contemplated by the legislation and the Board's processes requires a party to challenge any matter it disputes when faced with the assertion. The trade union did not attempt to hide or misrepresent its intentions in the certification application. It is clear from the application that the trade union was asserting (whether knowingly or by mistake) that Law employed carpenters on the date of application. If Law was of the view that it did not employ carpenters on the date of the certification application, it was incumbent on it to raise that issue in a response to the certification application. In fact, it did raise the issue in the request for reconsideration.
The Board has stated that in order to establish a fraud, it "must be demonstrated that a false representation was made to the Board which the Board relied on and also that the representation was known, or ought reasonably to have been known by the purveyor thereof to be false". See Ontario Taxi Association 1688, [1981] OLRB Rep. Sept. 1280 at paragraph 19. The cases where fraud has been found generally involve questions concerning membership evidence filed; where, because of the confidentiality provisions in the legislation, a responding party does not have the same opportunity to challenge that evidence.
Even assuming the trade union had information that Law was not the employer of the employees in question, Law was given notice of the trade union's application at the behest of the trade union; ensuring the very opportunity to dispute the assertion and have it sorted out, if necessary, through the normal certification process. It would be inappropriate to require, as the applicant suggested, some kind of "due inquiry" test of a trade union. Often, particularly in the construction industry, the real employer is unclear at best, and involves mixed questions of fact and law.
Similarly, a trade union asserts the number of employees it believes to be in the bargaining unit sought (both in the application and in the A-80 declaration). That too is an issue that is resolved through the normal processes of a certification application if disputed by a responding party. The applicant acknowledged that section 64 would not apply so as to conclude that a certificate had been obtained by fraud in circumstances where the trade union, even knowingly, asserted the incorrect number of employees in the proposed bargaining unit. In our view that issue is no less "fundamental" to a certification application (as the applicant here asserted) than the issue of the proper employer, and both are evident to a responding party from a review of the information asserted in the application.
In essence, the Board does not rely on the representation (or misrepresentation) of an applicant trade union as to the employer of the employees sought to be represented, except in the absence of a response from the named employer. The named employer has, and in this case had, the opportunity and obligation to respond; to raise matters within its knowledge which it disputes. A failure to respond cannot change the character of the Board's then reliance on the trade union's information to amount to a fraud on the Board within the meaning of section 64. Or, to put it slightly differently, these are not facts which would justify finding or inferring fraud in respect of the trade union's conduct.
Section 64 is also a discretionary remedy. Assuming again that the allegations are true and provable, we would not exercise our discretion in these circumstances to set aside the certificate obtained for much the same reason as we would not be prepared to infer fraud. The trade union named Law in its application for certification, provided the information with which to provide Law with notice of the application, and filed membership evidence on behalf of employees signifying their desire to be represented by the trade union. Law had the opportunity to respond and failed to do so. To the extent Law asserts a misrepresentation on the part of the trade union, it was one that was apparent on receipt of the application and certainly no later than receipt of the Board's decision certifying the applicant. A request for reconsideration was filed and dismissed. The only difference is that Law now asserts that the misrepresentation was made knowingly by the trade union. That alone is insufficient, given the other circumstances, to warrant reviewing that issue some six months after bargaining rights have been established.
The Board has stated that section 64 should not be expanded to include allegations which can be filed under other sections of the Act. See for example, Easy Enterprises Inc., [1987] OLRB Rep. July 994. The issue of the proper employer of the employees sought to be represented was one which could, and should, have been dealt with as part of the certification application.
For those reasons, we dismiss the application.
CONCURRING OPINION OF BOARD MEMBER W. H. WIGHTMAN; January 25, 1996
As noted in the main body of the decision the employer in this matter did not respond to the original application. The problems now facing Law Development Group flow from that act of omission.
From the viewpoint of Richard Law, the central problem is that Law Development Group finds itself bound to a collective agreement with the carpenters union covering ICI and non-ICI construction. Since Law Development Group claims never to have had any employees, past or present, it might seem of no consequence to be so bound. In fact even if indeed the company has no employees, nor any intention of employing craftsmen directly, being bound to the collective agreement will have considerable impact on its ability to act as a general contractor.
I regard it as anomalous that a correct interpretation of the law should result in a company with no employees being bound to a collective agreement and do not believe this would have been the legislative intent.