[1997] OLRB REP. MARCH/APRIL 286
3472-95-G Carpenters & Allied Workers Local 27 United Brotherhood of Carpenters & Joiners of America, Applicant v. Toronto Dominion Bank, Responding Party
BEFORE: R. O. MacDowell, Chair, and Board Members R. M. Sloan and P R. Seville.
APPEARANCES: Norman Jesin for the applicant; F. C. Hamilton for the responding party.
DECISION OF R. O. MacDOWELL, CHAIR, AND BOARD MEMBER P. R. SEVILLE; March 5, 1997
I
This is the referral of a grievance to arbitration, made pursuant to section 133 of the Labour Relations Act, 1995. Section 133 reads, in part, as follows:
(1) Despite the grievance and arbitration provisions in a collective agreement or deemed to be included in a collective agreement under section 48, a party to a collective agreement between an employer or employers' organization and a trade union or council of trade unions may refer a grievance concerning the interpretation, application, administration or alleged violation of the agreement, including any question as to whether a matter is arbitrable, to the Board for final and binding determination.
(3) Upon a referral under subsection (I), the Board has exclusive jurisdiction to hear and determine the difference or allegation raised in the grievance referred to it, including any question as to whether the matter is arbitrable, and subsections 48(10) and (12) to (20) apply with necessary modifications to the Board and to the enforcement of the decision of the Board.
- For ease of reference, the applicant in this matter will be referred to as "the Union" and the responding party will be referred to as "the Bank".
II
This proceeding arises because the Union contends that the Bank has failed to comply with the terms of a collective agreement by which it is bound. Under the terms of that agreement, all carpentry work must be done by members of the Union - either by employing union members directly, or by "sub-contracting" the carpentry work to businesses which have a collective bargaining relationship with the Union. The purpose of these clauses is to ensure that union members have access to emerging work opportunities that are within their trade and are controlled by the Bank.
The Union says that the Bank has failed to apply these terms of the collective agreement to certain carpentry work on a job site at Sheppard Avenue East in North York. The Union claims that this work was done by a non-union contractor and/or by persons who were not members of the union. The Union seeks compensation on behalf of the union members who, the Union says, should have been hired to work on the Sheppard Avenue job.
The Bank replies that it was not obliged to apply the terms of the collective agreement to this job because of the decision of the Board in Board File 3178-91-G released on May 3, 1995 ("the Davie decision" - which is now reported as United Brotherhood of Carpenters and Joiners of America Local 785 vs. Toronto Dominion Bank, [1995] OLRB Rep. May 686).
Board File 3178-91-G was an application much like the present one. There, as here, the Union claimed that certain carpentry work done in bank branches should have been done by "union carpenters"; and there, as here, the Bank resisted that claim. However, after hearing the parties' evidence and representations, the Board dismissed the Union's grievance. The Board confirmed that the Bank was bound by the Carpenters' provincial collective agreement, but, the Board went on to say that the Union was estopped from enforcing the terms of that agreement in respect of both the carpentry work completed prior to the issuance of the Board's decision (the "Davie decision"), and certain business arrangements for the performance of carpentry work that were already in place when the decision was issued (i.e. on May 3, 1995).
The Bank maintains that the present grievance relates to one of the "excluded business arrangements' identified in the Davie decision - that is, that the "estoppel" found in the Davie decision also applies to the carpentry work done on the Sheppard Avenue project, so that the Bank was not obliged to employ union members or engage a unionized contractor to perform that work. The Bank urges the Board to dismiss this grievance on the same basis as the "Davie panel" dismissed the grievance before it.
In view of this linkage with the decision of the "Davie panel", it may be useful to sketch in some background (which is also recorded in two other Board decisions which will be mentioned briefly below).
III
The main business of the Bank is, of course, "banking"; but, from time to time the Bank is also involved in the construction or renovation of buildings that are, or will become, bank branches. Those "construction activities" are undertaken either by the Bank's own employees, or by the employees of "sub-contractors" engaged by the Bank to do this work.
In 1976 and 1978 the Bank was apparently using its own employees to do certain carpentry work in Western Ontario. Those bank employees were (or became) members of the Carpenters' union, which applied to the Board for certification as their bargaining agent. In 1976 the Board certified the Union as the bargaining agent for a bargaining unit encompassing "carpenters and carpenters' apprentices in the employ of the Toronto Dominion Bank forces (Premises Division) in the County of Wellington". In 1978 the Union was certified to represent a bargaining unit of "carpenter and carpenters' apprentices in the employ of Toronto Division Bank forces (Premises Division) in the Counties of Brant and Norfolk". In neither case was there any challenge to the application of the Labour Relations Act to these employees, or to the Board's jurisdiction to grant these certificates.
By the late 1970s, then, the Union had acquired some geographically-defined bargaining rights in Western Ontario. However, in 1978 these "local" bargaining rights were extended province-wide, by operation of law, when the Legislature imposed the present system of province-wide bargaining in certain sectors of the construction industry. However, it seems that for a number of years the Bank did not seek to assert its now province-wide bargaining rights, nor did the union actively enforce the terms of the provincial collective agreement. This inactivity provided the basis for a number of arguments that were ultimately raised before the "Davie panel" in Board File 3178-91-G.
The application in Board File 3178-91-G was filed on January 7, 1992, and as we have already noted, involved a complaint by the union that certain carpentry work in Bank branches was being done by persons who were not union members. The Union asserted that this situation was contrary to the terms of the collective agreement. However, the Bank raised a number of defences to the Union's claim - including the argument that the original certificates were void because, as a matter of constitutional law, the Labour Relations Act could not apply to this aspect of the Bank's business.
Briefly put, the Bank asserted that its construction activities were an integral component of its federally-regulated undertaking (i.e. its banking operations) and that, accordingly, any associated employment relationships were subject to federal - not provincial - regulation. The Bank asserted that only the federal Parliament could regulate "banks and banking", and that the "construction arm" of its operation fell within those parameters. In the Bank's submission, its operations were not covered by the Ontario Labour Relations Act, so there was no foundation for bargaining rights or a collective agreement.
It is unnecessary to review this "constitutional argument" in any further detail. It suffices to say that the initial panel hearing the case rejected the Bank's argument in a decision dated October 30, 1992 ("the B loch decision"). The Board held that the Bank's construction activities were incidental to its banking operations and, thus, were subject to provincial - not federal - regulation. The Board concluded that there was no defect in the original certification process. And since the Labour Relations Act was applicable, the Board had jurisdiction to determine whether or not the Bank was obliged to abide by the terms of the collective agreement in the circumstances raised in the referral to arbitration.
There followed a protracted legal challenge to the Board's decision on this "constitutional issue". The arbitration proceeding was held in abeyance pending the conclusion of the Court proceedings.
The Bank's application for judicial review was dismissed by the Divisional Court on March 17, 1993. A motion for leave to appeal to the Ontario Court of Appeal was dismissed by the Court of Appeal on June 14, 1993. A further motion for leave to appeal was dismissed by the Supreme Court of Canada on January 17, 1994.
Following the completion of these constitutional challenges, the matter was re-listed for hearing before a differently-constituted panel of the Board (the "Davie panel").
The issues raised before the new panel are canvassed at some length in the "Davie decision" dated May 1, 1995, and, again, need not be repeated here in any detail. It is sufficient to note that, among other things, the Bank argued that:
(1) because of the union's activity it had abandoned its bargaining rights, so that neither the original certificate nor the collective agreement were of any current legal force or effect; and in the alternative that …..
(2) because of the Union's activity, the Union was estopped from enforcing the terms of the collective agreement in respect of the work to which the grievance applied.
If the abandonment argument were accepted, there would be no collective agreement or collective bargaining rights as between the Union and the Bank. If the estoppel argument were accepted, the collective bargaining relationship would continue, but the Union would be prevented from demanding compliance with the Agreement until the "estoppel" was brought to an end.
After considering the parties' submissions, the "Davie panel" found at paragraphs 55-69 that the Union had not abandoned its bargaining rights. The Board held that the Union's dilatory conduct was not sufficient to completely nullify the collective bargaining relationship and the collective agreement based upon it. However, the Board substantially accepted the Bank's estoppel argument, in a long passage to which we might usefully refer:
Insofar as estoppel and the Bank's construction activities through the use of outside contractors is concerned, however, the issue is complex. For nearly fifteen years the Bank has contracted out a portion of its construction activities to outside contractors. As a result of the union's conduct as noted herein, when it contracted out work the Bank did not consider the union affiliation of those with whom it contracted. In letting out construction contracts, the Bank was motivated by business considerations and not the union affiliation of the contractor engaged. The union now seeks to strictly enforce the collective agreement with the obvious result that union affiliation of those with whom the Bank contracts would become a prime consideration.
Over the past fifteen years the Bank developed its methods of performing its construction work, let out contracts, established and terminated relationships, while the union silently stood by without any communication to the Bank that its conduct was inconsistent with its obligations to recognize the bargaining rights held by the trade union. That the Bank acted differently because of the union's conduct and fifteen year silence is beyond doubt. The union now seeks to alter that state of affairs. In our view the union may do so only upon the giving of reasonable notice, that is to say, notice which takes into account the reliance interests of the Bank and which provides to the Bank an opportunity to return to the position it was in when the union exerted its bargaining rights.
The union argues that such notice was given when this grievance was filed and that the estoppel was brought to an end at that time. It asserts that with the filing of this grievance the Bank was put on notice that the union was asserting its bargaining rights and sought to enforce all of the collective agreement obligations. From that point forward the Bank knew that its future construction activities could be affected by that assertion of bargaining rights and enforcement of collective agreement obligations.
We have determined that, in the face of a fifteen year silence by the union, the Bank need not have altered the manner in which it had conducted its construction activities merely because it received notice of a grievance.
In the result we have decided that the requisite notice which brings to an end the estoppel and which appropriately considers the past reliance of the Bank comes with the issuance of this decision. The estoppel therefore does not apply to contracts entered into after this date. With this decision the Bank knows that the union is asserting its bargaining rights and intends to enforce those bargaining rights. As a result of this decision the Bank also knows that its arguments of abandonment have not been accepted, it is required to recognize the union and comply with all of the provisions of the collective agreement including the sub-contracting provisions. It knows that any future dealings with outside contractors will be affected by those bargaining rights and can govern itself accordingly (see also for example Aluma Systems Canada Inc., [1994] OLRB Rep. Nov. 1469).
We recognize that this grievance was filed in January 1993 and that the Bank may have engaged in construction activities in the intervening two year period in contravention of the terms of the ICI provincial agreement. Our decision with respect to the estoppel and the appropriate notice required to end such an estoppel should not be taken as a signal that the Board will always bring the estoppel to an end with the issuance of its decision. In this regard, we are particularly concerned that parties may engage in lengthy, protracted and unnecessary litigation in an effort to prolong the period during which the estoppel runs. That is neither the purpose nor the intended result of this determination. Rather it must be remembered that estoppel is an equitable concept used by courts and administrative tribunals alike to fashion fair and appropriate remedies which take into account all the facts and circumstances. In this case the Bank has pursued a compelling and meritorious position which ultimately was rejected by the Board. The time which has elapsed since the filing of this grievance and the issuance of this decision has been the result (in large part) of the pursuit of legal avenues, and there is nothing to suggest that either party deliberately delayed matters. In other less compelling circumstances, or where the Board considers the delay to be the fault or responsibility of one of the parties, the Board may find that an equitable balancing of the facts results in the estoppel coming to an end with the filing of the grievance as it did in KNK. supra. Alternatively, an equitable balancing of the facts and circumstances may. in appropriate cases, cause the Board to conclude that the estoppel should run for some time beyond the issuance of its decision. Each case must be determined on its own particular facts.
In the result we declare that the Bank is bound to recognize the bargaining rights of the Carpenters and is bound to the existing provincial collective agreement between the Carpenters Employer and Employee Bargaining Agencies. This grievance however is dismissed.
[emphasis added]
- In reaching this conclusion, the Board recognized that as early as January 1992 the Union had challenged the Bank's position by filing a grievance. The Board also recognized that the 1992 grievance put the Bank on notice that the Union was asserting its collective agreement rights (if any) so that, when the Bank ignored the Agreement between 1992 and 1995, the Bank was taking a risk that its legal positions would not ultimately prevail. And the Board noted that in a contractual regime, notice of intent to return to one's strict legal rights (here by filing the grievance in January 1992) is often sufficient to bring an estoppel to an end, because, thereafter, a party can no longer claim detrimental reliance based upon a representation that legal rights will not be enforced. In summary, the Board acknowledged that there is a respectable body of arbitration decisions to this effect, so that when the Bank continued to ignore the collective agreement after the grievance was filed, the Bank was running the risk that it would not escape liability for that decision. Nevertheless, in all the circumstances, the Board considered it appropriate to preclude the Union from insisting on the employee's collective agreement rights until the issuance of the Board decision on May 3, 1995. To repeat, the Board held:
"the estoppel therefore does not apply to contracts entered into after [May 3, 1995]".
Contracts for construction work entered into prior to May 3, 1995, did not have to comply with the terms of the collective agreement. Contracts entered into after May 3, 1995, did have to comply with the collective agreement.
- The Davie decision was also the subject of an application for judicial review, which came on for hearing before the Divisional Court on October 22, 1996. The Bank's application for judicial review was dismissed with the following endorsement:
"This application is dismissed. The Applicant, T.D. Bank. seeks judicial review of the decision of the OLRB holding that the Union had not abandoned its bargaining rights with the T.D. Bank. In paragraph 55 to paragraph 59 (inclusive) of the Reasons, the OLRB found that the evidence before it did not reach the necessary plateau to find "abandonment". The Board went on to hold that the evidence did justify a finding of estoppel to the date of its decision. Mr. Morphy [counsel for the Bank] submitted that the OLRB's decision must be correct, otherwise the Board had no jurisdiction. Assuming that is the benchmark, we find that it has been met
In the Court's view, therefore, the Davie panel was "correct" - both with respect to the "abandonment issue" and with respect to the "estoppel question". The Court found no fault with the Davie panel's decision to relieve the Bank of its collective agreement obligations for contracts for construction work entered into prior to May 3, 1995, but, by the same token, to hold the Bank to the collective agreement terms for contracts entered into after May 3, 1995.
The Davie panel was obviously concerned that the Bank should not be put in a position where complying with the terms of the collective agreement would require it to abrogate existing commercial contracts. The Board was not anxious to put the Bank in a position where it would face competing but irreconcilable legal claims. The Board used the equitable doctrine of estoppel to extricate the Bank from this predicament, and held that the Bank only had to apply the terms of the collective agreement for contracts (for construction work) entered into after May 3, 1995 (the date the Board decision issued).
But what of ongoing negotiations or business arrangements for the performance of carpentry work that had not yet crystallised into a "formal contract" by the time the Davie decision was issued on May 3, 1996, and from which the Bank could therefore withdraw without facing a breach of contract action for damages? Were these business arrangements "caught" by the estoppel too? That is a question addressed in yet another case: United Brotherhood of Carpenters & Joiners of America, Local Union 2050 vs. Toronto Dominion Bank, Board File 2320-95-G filed with the Board on September 14, 1995 and decided by the "Joachim panel" on December 12, 1995.
Board File 2320-95-G involved the same parties (the Carpenters' Union, the T.D. Bank, the provincial collective agreement) and the same kind of claim: that certain carpentry work done in Bank branches should have been performed by union members pursuant to the terms of the collective agreement. It was a case like the present one in which the bidding process had begun before May 3, 1995, but had not culminated in a formal commercial contract by the time the Davie decision was Issued. The question then became: Is this work caught by the estoppel defence or not'? In effect, the new panel in Board File 2320-95-G (the Joachim panel) was being asked to reconsider or clarify the application of the "estoppel" found in the Davie decision reproduced above.
In this case, though, the Board accepted the Union's position that estoppel did not apply. The Board held that the Davie decision was clear and that the Bank was obliged to apply the terms of the collective agreement to its carpentry work unless it had already entered into a binding commercial contract for such work prior to May 3, 1995. At paragraph 28 the Board commented:
……In the TD Bank case the Board [the Davie panel] drew a clear line to establish when, in its view, it was fair to end the estoppel. It drew that line at the point when the Bank entered into a contract, after May 3, 1995. In our view that line is a reasonable and appropriate one. With respect to any contracts entered into after May 3, 1995 the Bank was in a position to comply with the term of the Carpenters Provincial Agreement. We reject the Bank's argument that it could not or should not be expected to interrupt its bidding process. There is no compelling reason why it cannot do so. The Bank's own instruction to bidders states that the Bank may decide to reject any or all of the bids tendered.
And at paragraph 25 the Board observed:
The Bank does not bid on projects, rather it accepts bids. The prejudice to the Bank arises at the time the Bank enters into a contract, the timing of which is entirely within its own control. The Bank does not suffer any significant prejudice in interrupting the bidding process.
In the opinion of the "Joachim panel" the key question was whether the Bank could extricate itself from these business dealings so as to comply with its collective agreement obligation - that is, whether the Bank could avoid the competing legal claim that troubled the Davie panel. As long as the Bank was not contractually bound to a particular course of action by May 3, 1995, it could rearrange its affairs, and there was nothing inequitable in holding the Bank to its prior collective agreement obligations - even if that required the Bank to re-open the bidding and re-tender the work. To put the matter another way: the Joachim panel was of the view that the estoppel described in the Davie decision (see above) did not apply unless the dealings by which a contractor was selected had progressed to the stage of an actual contract for the work in dispute.
With this background, then, we turn to the facts in the instant case. These facts are not substantially in dispute. But the parties do disagree about how the facts should be characterized, and how the facts fit within the framework established by the Davie decision and by the Joachim decision.
The Board's information about the Sheppard Avenue job was provided by Nick Lamb, a Real Estate Operations Officer for the Bank.
IV
Mr. Lamb testified that the project on Sheppard Avenue East was done by a private firm which obtained the work by competitive bidding. He explained that in selecting the contractor to whom the work will be awarded, the Bank takes into account such factors as: the bid price; the apparent reliability of the firm; whether the Bank has dealt with the firm before; and whether the firm was itself a customer of the Bank. And, of course, to the extent that the collective agreement applies, the Bank must also take into account whether the subcontractor is "unionized".
In this instance, the project involved the relocation of an existing branch from 187 Sheppard Avenue East to new premises across the street at 280 Sheppard Avenue East. The new branch was going to be larger, have better parking arrangements, and provide various services and facilities that had not been available at the smaller location. The objective was to have an "Asian focus" so as to attract new clientele from the growing Asian market in the area, and by early 1995, the relocation (and its overall budget) had received head office approval. There was some urgency to complete the move because the Bank had already leased the new premises, and its existing branch was clearly inadequate.
By mid-March 1995 drawings and plans had been completed, and on March 22, 1995, a number of construction companies were invited to submit bids. The invitation to tender included the following stipulations:
1.1 The intent of this bid call is to solicit and receive formal offers to perform the work acquired by the Bid Document ("the work").
2.1 Submission of a bid will be considered an agreement by the bidder to execute the Canadian Standard Construction Document for Stipulated Price contract, CCDC2- 182 within fifteen (IS) days after delivery of CCDC2-1982 to him for execution.
7.5 The lowest, or any bid, will not necessarily be accepted, and the Owner [the "Bank"] reserves the right to reject any and all bids.
8.2 The Owner reserves the right to negotiate contract terms with a potentially acceptable bidder.
[emphasis added]
As will be seen, the bidder is obliged to enter into a contract in a particular form after the successful firm is selected; however, the terms of that contract are to be worked out later, and the Bank is not required to accept the lowest bid. For present purposes, it is important to note that the selection of the successful bidder is distinct from the subsequent contract by which the work is performed.
The closing date for bids was initially fixed at April 12, 1995. It was later extended to April 24, 1995, because there had been some changes in the work specifications. There were five companies "in the running" and, as it turned out, the bids of the top three companies ranged from $340,000 to $360,000. There is no evidence that any of these companies were "unionized", nor is there any evidence that the Bank considered itself obliged to apply the terms of the Carpenters' provincial collective agreement. (By this time the Union's case in File 3 178-91 -G had returned from the Courts and had been argued before the "Davie panel", but that panel had not yet issued its decision, so the Bank would have been aware that it faced at least some risk that its abandonment and estoppel arguments might not be successful.)
On April 26, 1995, Mr. Lamb prepared a memo for D. Moore, the Bank's Vice-President of Corporate Real Estate Operations. The memo reads, in part:
"This project was tendered to five customer contractors by Toronto Division Real Estate Operations and we recommend awarding the contract to the low bidder Classic Construction Company".
[emphasis added]
The memo includes information about the five bidders, and notes that it is important to expedite completion of the project because the existing lease at 187 Sheppard Avenue expires September 30, 1995. The memo concludes:
"We would appreciate receiving your approval and/or comment.
Thank you for your assistance and we look forward to receiving your approval."
Mr. Lamb testified that Classic Construction Company was the lowest bidder and was thought to be reliable because the company had recently been formed by Allan Blake, a former employee in the Bank's own construction division. That is why Mr. Lamb was recommending that Classic be awarded the job.
Once the bids had been examined and the selection made, Mr. Lamb told Mr. Blake that he (Lamb) was recommending that Classic be given the job and that, accordingly, Mr. Blake should begin gearing up" for the project and preparing the necessary paperwork. Mr. Lamb told Mr. Blake that as soon as he received head office approval, a formal contract could be concluded. As far as Mr. Lamb was concerned, such approval was a "rubber stamp" because his recommendations were routinely accepted; moreover, there was no doubt that the project would go ahead because of the time pressures mentioned above. On the other hand, Mr. Lamb conceded that head office had the authority to withhold approval or reject his recommendation. Mr. Lamb also conceded that:
no commercial contracts could be concluded and no work could be undertaken until head office approval was obtained; and
no contract is ever signed without head office approval.
It is pretty clear that, from Mr. Lamb's perspective, he did not consider the Bank legally bound to have Classic do the work until head office approved and a formal contract had been executed. In other words, prior to final approval, Classic could not require the Bank to follow through nor seek damages if it did not. Indeed, we suspect that the Bank itself might be surprised by a ruling that it had enforceable legal obligations at that stage of the process. Be that as it may, Mr. Lamb testified that he told Mr. Blake that a formal contract would follow head office approval.
Early in May, there were further discussions between Mr. Lamb and Mr. Blake about the upcoming job and, as a result of those discussions, it was agreed that certain portions of the work would be done by someone else. Mr. Lamb explained that these variations were minor ones, and that they were not significant enough to require a new tender. Mr. Blake was agreeable to the proposed changes to the content of the job.
On May 15, 1995, Mr. Lamb received head office approval to proceed with the project along the lines earlier recommended. On May 17, 1995, the Bank entered into a contract with Classic Construction to perform work at 280 Sheppard Avenue beginning on June 1, 1995. The document is executed by Mr. Lamb on behalf of the Bank, and by Allan Blake, President of Classic Construction Company, a Division of 1093079 Ontario Ltd. The contract incorporates the "standard form" covenants mentioned in the bidding document, as well as a description of the work to be done. Among those contract terms is this one:
"The contract supersedes all prior negotiations, representations, or agreements, either written or oral, including the bidding document. The contract may be amended only as provided in the General Conditions of the Contract."
This is the contract which governed the performance of work on the Sheppard Avenue project.
The Union claims that the work done on Sheppard Avenue pursuant to this commercial contract should have been done in a way that was in compliance with the Bank's obligations under the collective agreement.
We agree.
In the first place, we do not think that as of May 3, 1995 (when the Davie decision was issued), the Bank was under any enforceable legal obligation to have the work done by Classic. Mr. Lamb was not prepared to say that there was a binding contract in existence prior to head office approval, and he had specifically told Mr. Blake that a contract would not be entered into until after such approval had been obtained. While there was obviously an expectation that a commercial contract would be consummated on appropriate terms, that did not actually happen until May 17, 1995; moreover, it is the May 17th document which established the "contract" pursuant to which the work was performed. And by May 4, 1995, the Davie decision had been received by the Bank, and the Bank was aware (or should have been aware) that any new subcontracting arrangements pertaining to carpentry work would have to be congruent with the Bank's obligations under the collective agreement.
We find that as of May 3, 1995 there was no "contract" for carpentry work as that term is used in the Davie decision.
One can appreciate why the Bank might not want to re-tender the job, or take other steps to ensure that its commercial contract with Classic conformed to its collective agreement obligations. By that time, there was commercial pressure to get the job done quickly and a satisfactory sub-contractor had been selected. However, in our view, what the Bank's argument boils down to, is a quarrel with the line drawn by the Davie panel, and a request that this panel of the Board extend the estoppel further, to cover commercial dealings and expectations that had not produced a formal "contract" as at May 3, 1995. Moreover, since the case was fully argued before the Davie panel in November 1994, the Bank must have been aware that it was taking a risk in April 1995 by disregarding the terms of the collective agreement. Indeed, from at least 1992, and certainly by late 1994, the Bank knew that it might not win its legal argument and that it might be obliged to apply the terms of the collective agreement and pay whatever damages arose from not having done so.
The point is: the Davie panel had to determine the duration of the estoppel which it found to be operating and it held that:
"the estoppel therefore does not apply to contracts entered into after this date [May 3, 1995]"
The Davie panel might have determined a different cut-off point; but after weighing the equities, it ended the estoppel as at May 3, 1995, so that any contracts after that date had to be congruent with the Bank's collective agreement obligations. To put the matter another way: the Bank was relieved from its collective agreement obligations from 1992 to May 3, 1995, but not thereafter.
We are not inclined to reconsider or revise the estoppel determination of the Davie panel. The contract with Classic Construction (by which carpentry work was done on the Sheppard Avenue project) was entered into on May 17, 1995 - which is after the issuance of the Davie decision, and is therefore outside the ambit of the estoppel found to be operable as between the parties in this proceeding.
It follows that the Bank was obliged to apply the terms of the Carpenters' collective agreement to the work done on the Sheppard Avenue project and that a failure to do so gives rise to a claim for damages in respect of work that should have been done by union members, but was not.
For the foregoing reasons, we find that the Union is NOT estopped from asserting the claim identified in this grievance. However, the Board heard no evidence about the dimensions of such claim or the amount of compensation to which the Union and/or its out-of-work members may be entitled. The matter is therefore referred back to the parties for further consideration so that they may consider the possibility of settlement without further litigation.
In the event that the matter is not settled, it may be re-listed for hearing at the request of either of the parties.
This panel is not seized.
DECISION OF BOARD MEMBER R. M. SLOAN; March 5, 1997
I dissent.
This case is not a civil dispute between The Toronto-Dominion Bank and Classic Construction as to whether or not the arrangement entered into between them is "... a binding legal contract or whether it represents "... enforceable legal obligations
Both the TD Bank and Classic Construction recognize and agree that under the labour relations realities and long-standing entrenched and accepted practices in the Ontario Construction Industry, a contract existed between them prior to May 3,1995 for the subject construction work at 280 Sheppard Avenue East.
As alluded to earlier, we are not dealing here with a legal dispute before the Courts between the two contracting parties, but with a grievance filed by the union under the Construction Industry provisions of the Ontario Labour Relations Act - and it behooves the Board to recognize this distinction and deal with the issue on the basis of the applicable historical and current practices, and labour relations realities.
There is no question, in my view, that for the purposes of the Davie decision a contract was in existence between the TD Bank and Classic Construction prior to May 3, 1995.
The majority decision applies, in my view, much too narrow and legalistic a meaning to the term contract - one which I feel certain would not be supported nor was intended by the Davie decision.
The commercial realities in the construction industry dictate that for the system to work at all both parties - "owners" and contractors - have to operate in an atmosphere of trust where the "word" of the parties is "their bond".
Contracts are let and the commencement of work authorized, not on the basis of formal. written, signed, enforceable documents, but by: a simple verbal understanding; a handshake; handwritten notes; purchase orders; or other informal means.
It is my understanding that the instances in the construction industry where a formal written contract is entered into before the contract is awarded and work commences are few and far between in the overall scheme of things.
If the requirement for such legalistic practices became the norm, then work in the industry would grind to a halt.
Prior to May 3, 1995 a contract by any definition existed between the TD Bank and Classic Construction.
The TD Bank had authorized and allocated funds for the project.
The TD Bank had obtained the required building permits.
The TD Bank had informed Classic Construction that they were the successful bidder and had instructed them to gear up for quick action to meet a tight deadline.
- In summary, prior to May 3, 1995, a contract for purposes of the Davie decision was in effect between the TD Bank and Classic Construction, and I would therefore dismiss this instant grievance.