Ontario Labour Relations Board
File No.: 0911-98-U Date: March 3, 2000
Cheryl MacDonald, Applicant v. Canadian Union of Public Employees Local 167, Responding Party
Before: M. A. Nairn, Vice-Chair
Appearances: Norman Williams for the applicant; John Elder for the Canadian Union of Public Employees, Local 176.
DECISION OF THE BOARD
1This is an application brought pursuant to section 96 of the Labour Relations Act, 1995 (the “Act”) alleging a violation of section 74 of that Act. A consultation was convened, certain evidence was heard, and the parties filed written submissions. The employer, the Regional Municipality of Hamilton-Wentworth, did not file an intervention and did not participate in these proceedings.
2After this application was filed, a decision of the Board (differently constituted) dated July 3, 1998 directed the applicant to file a statement detailing allegations of the action or inaction of the responding party that she relied on in support of the assertion that section 74 of the Act had been violated by the responding party (the “trade union”) . Subsequently a consultation convened.
3At the time the consultation convened before me the trade union took the position that I ought to exercise the discretion not to inquire into this matter as all employment issues between the applicant and her employer had been resolved. The trade union relied on a settlement entered into on August 13, 1998 signed by the applicant. The trade union took the position that the settlement would constitute a bar to any arbitration proceeding as the applicant had accepted the benefit of the settlement. Further the settlement acknowledged that all employment issues were resolved by that settlement.
4At the outset, the applicant took the position that she was seeking reinstatement to employment through an order from the Board, or alternately, damages from the trade union. The applicant was expressly, however, not seeking damages from the employer, nor was she seeking to have her grievances referred to arbitration. Damages were asserted to be based on an assessment of reasonable notice, suggested to be 18 months less any amount she had received through the settlement with the employer. Alternatively, damages were to be calculated on the basis of the amount she claimed pursuant to the short-term disability plan (“STD”) provided through her employment. The applicant acknowledged that this represented a request that the union pay to her an amount that the employer only may have been required to pay (subject to an arbitral determination that she had been improperly denied this benefit). There was also a claim for additional monies representing wages for lost employment and legal costs.
5After hearing from the parties and reviewing for them the scope of the Board’s jurisdiction under section 74 of the Act, the consultation was adjourned in order to allow the applicant to file a new application, the basis of which was to seek to challenge the settlement entered into by the applicant in August 1998. The applicant filed further material. Although not filed as a new application, the responding trade union did file a response to that additional material and the matter ultimately proceeded on that basis. In a decision dated July 20, 1999, I noted however that:
- At the consultation held on February 4, 1999 a considerable period of time was spent discussing the availability and/or appropriateness of various remedial requests made by the applicant. It was as a result of those discussions that the applicant sought to file material seeking to set aside the settlement. The original particulars of this complaint have been eclipsed by the fact of the applicant entering into that settlement. I note that in the subsequent material filed, the applicant seeks the same remedies of damages, including punitive damages, that she sought in her original complaint. As discussed on February 4, 1999 the Board’s approach to remedy is to put a successful applicant in the position they would have been in but for the violation of section 74. There is now a settlement in place; the benefit of which has been accepted by the applicant. It purports to resolve all outstanding issues regarding her employment. I am concerned that the applicant continues to misunderstand the scope of both section 74 of the Act and the Board’s remedial authority in light of the additional material filed.
6When the consultation reconvened the applicant sought to have the settlement set aside and an order that the grievances proceed to arbitration. It was the position of the applicant that she had lacked the capacity to enter into the settlement in August 1998 as a result of her medical condition. The union maintained its position that I ought to exercise my discretion against inquiring into the complaint on the basis that the settlement was entered into voluntarily, it resolved all employment matters concerning the applicant, and that the applicant had accepted the benefit of the settlement. As noted, I both heard evidence and received certain facts not in dispute during the consultation process and I received the representations of the parties. I now turn to consider that material.
7The applicant was employed as an Income Maintenance Worker for the Regional Municipality of Hamilton-Wentworth. She has a Bachelor’s degree in psychology. The applicant’s difficulties arose as a result of an alleged altercation with a co-worker, wherein it is alleged that the co-worker threatened to strangle the applicant. She alleges that the employer failed to respond to this threat. Over time the situation is alleged to have deteriorated, eventually resulting in the applicant’s inability to attend work due to her then medical condition. The employer disputed this position throughout. Although not pleaded, the applicant also referred to an alleged assault by a client in 1992. As a result she stated she was off work for a couple of weeks and found it to be a traumatic experience.
8The trade union filed a grievance dated May 1, 1997 alleging that the applicant was improperly denied short-term income protection arising from her absence from work. On May 27, 1997 a second grievance was filed at the behest of the applicant’s then counsel. That grievance states that the applicant had been denied her right to “receive S.T.D. as per the Collective Agreement” and requests that the discrimination against her cease and desist; that she be placed on STD and be compensated for any lost wages, benefits and seniority.
9There was a dispute on the facts as to whether or not the applicant had earlier wanted her grievances to proceed or whether she had asked that they be held in abeyance until her health improved. This complaint was initially filed on June 5, 1998 and alleged, among other things, a failure on the part of the trade union to actively pursue her grievances. In any event, as of May 1998, the trade union understood that the applicant wanted her grievances to proceed. At a union meeting on June 22, 1998 it was determined that the grievances would proceed expeditiously to grievance mediation. The applicant was present at that meeting.
10On June 23, 1998 the employer forwarded a letter to the applicant, essentially advising her that her termination from employment was imminent as she was not attending at work and was not in receipt of disability coverage.
11On July 9, 1998 the union informed the applicant of the arrangements for the mediation. Apparently this is a process that the trade union regularly uses in order to determine whether matters may be settled short of fully litigating them. Although there may be some dispute as to the time of the request, the trade union asked the applicant to supply medical documentation in support of her claim for STD benefits. And while there was also some dispute as to when the union received the material, the trade union did receive three documents. The applicant provided two letters from a psychiatrist, Dr. Waldenberg, dated August 1, 1997 and August 10, 1998. In addition there was a Corporate Health form completed by Dr. Waldenberg on or about July 6, 1998.
12On August 10, 1998 the applicant met with a union representative in order to find out about the anticipated mediation process. The meeting was entirely unsatisfactory from her point of view as she asserted that the union representative did not explain anything of the process or what to expect at the mediation. This is disputed by the trade union. However notwithstanding this alleged lack of information, the applicant stated in-chief that she went to the mediation believing it was to deal with all of her grievances and that she was prepared with her calendars, date books, and all her information regarding the health and safety issue and why she was not back in the workplace. The applicant acknowledged that on August 10, 1998 she did not object to the mediation taking place. She also did not assert at that time that she was incapable of attending because of her medical condition.
13The parties met on August 13, 1998 in the morning with a mediator. The process had concluded by lunch. There is no dispute that the applicant signed the settlement document the substance of which provides:
The Union and the Grievor, Cheryl MacDonald hereby agree to withdraw from arbitration, the grievance dated 27 May 97 et al alleging violation of article 2 and benefits, subject to the following terms and conditions:
The grievor is deemed to have resigned and the employer will provide the grievor with a letter containing her date of employment, date of resignation, job title, and rate of pay.
As full and final settlement of all issues concerning the grievor’s employment with the region, the employer agrees to pay the grievor seven (7) months wages less minimum statutory deductions to be paid on or before 15 Sept. 1998.
This settlement resolves all issues concerning the grievor’s employment with the region including her WCB claim which is agreed will not proceed.
This settlement is made without prejudice or precedent to either party.
All signatories acknowledge that they have read these Terms of Settlement and understand their contents. The signatories are in full agreement with the foregoing.
14It was the position of the applicant that she was suffering from post-traumatic stress disorder. It was asserted that the union knew this and the fact that the applicant wanted her grievances to proceed did not mean that she was capable of participating in a mediation process. The trade union asserts that the settlement was entered into voluntarily and that the applicant was competent at the time.
15There was no dispute that the employer did not accept the medical evidence and was forcing the hand of the applicant to establish her claim to STD benefits. The applicant acknowledged that the two grievances referred to were the ones discussed in the mediation. She was aware from the June 22, 1998 union meeting that those were the grievances to be dealt with. Although the applicant asserted that she did not understand that the employer was to be present at the mediation, she acknowledged that she was aware of that early on August 13, 1998. She also agreed that she wanted her grievances to be dealt with and that she did not advise the union that she was not able to participate. She agreed that the medical information available to the union did not indicate that she was unable to participate in the mediation.
16The applicant described the symptoms of acute post-traumatic stress disorder as having nightmares, a lack of sleep, inability to focus, a short attention span, difficulty with trust issues, problems breathing, hyperventilating, and anxiety. She asserted that on August 13, 1998 she was suffering from some of those symptoms.
17The applicant testified that the night before the mediation she suffered anxiety, had problems breathing and that she didn’t sleep. When she met the union representative on the morning of August 13, 1998 she testified that she was very tense, had muscle pain, and was unable to breathe. When asked if she had complained to anyone, she stated she had told the mediator that she hadn’t slept the whole night and that she was having problems breathing. She testified that she was overwhelmed to find a number of people present for the mediation, but that she did not express that discomfort to anyone.
18The union produced its notes of the mediation to the applicant prior to the consultation. Although the notes were not put in evidence, the applicant agreed in cross-examination to contents put to her. She agreed that at the outset of the mediation she expressed concern regarding working in a poisoned work environment and the concern that she would not be able to return to work in that environment. She asked if she could be provided with a job with the Region of Halton. She acknowledged being advised that it was difficult to provide guarantees concerning the work environment when working with personalities. She confirmed that the mediator identified essentially two choices, to consider a severance package because of the concern about the work environment or proceed with the claims for STD and/or workers’ compensation benefits. She acknowledged that she raised an earlier offer of seven months severance from the employer and that there was discussion about comparing that amount to what she would receive should she be successful in obtaining STD benefits.
19In cross-examination she stated that she understood that the amount of severance represented a larger sum than the amount available and payable as STD benefits (a 26-week program). In reply she then suggested that she did not understand the figures to be accurate at the time and that she now wondered why pension wasn’t included. Yet the applicant then inquired as to the chances of getting more than seven months as severance and there was an attempt to convince the employer to agree to more severance. The applicant later asked about obtaining a letter of reference, a matter dealt with by the employer agreeing to provide a letter of employment. The applicant later received that letter. The applicant was told that the deadline on the severance offer was that day. In reply she asserted that she did not understand the alternative, yet clearly agreed in cross-examination that the mediator had explained her options to accept the severance or attempt to establish her entitlement to STD benefits at arbitration.
20In response to a question from me following this evidence the applicant identified her option as to walk out of the mediation and proceed to arbitration. When I asked her whether or not she had understood that on August 13, 1998 she stated she believed so but had been told she would not likely be successful at arbitration. She was told by both the union and the mediator that she was not likely to be able to establish that she was permanently disabled, she recalled reference to caselaw, and was told it was unlikely she’d receive STD. She understood that the employer was denying the STD benefit because it did not accept that she was ill.
21At a point in the mediation the applicant requested a break. She told the union that she wanted advice concerning the settlement offer. She did not tell the union who she was calling. At that time she called her mother who was not available. She wanted to discuss the option of taking severance and “all this new information put in front of me”. Although not able to contact her mother, the applicant did not ask for more time to consult. Nor did she tell the union that she had been unable to obtain advice. After that break the applicant decided to go ahead with the settlement.
22At other times the applicant had attended meetings with the employer or union with various advisors, including her mother, her counsel, and a Ms. Vukova. She did not bring anyone with her on August 13, 1998 and did not ask to have anyone other than the union representatives present.
23In response to her counsel’s question to explain why she did not have the capacity to enter into the settlement that day the applicant reviewed the following. She stated that she was under the impression that even though she was agreeing to severance she thought it was without prejudice. At the time this complaint to the Board was outstanding. She asserted that the union “skirted” over that on August 13. She stated that even though she’d agreed to severance she still had the Labour Board; that no one in the meeting clarified that the settlement meant that she wouldn’t be able to continue with that complaint. She stated that although the document referred to her grievances she was under the impression that it “would stop with the Region”. This must mean that she believed the settlement would resolve issues as they related to the employer. Fundamentally though, this response belies the assertion that the applicant did not have the capacity to enter into the settlement. At its highest the applicant may have misunderstood one of the terms of the settlement.
24In response to a further question in chief of whether her illness affected her decision-making on August 13, 1998 the applicant responded that she’d not been paid for 18 months, had been engaged in a constant battle with the employer, and felt no support from the union. She stated she hadn’t slept for probably 18 months and that she couldn’t handle the mediation.
25The applicant’s mother also testified. Ms. MacDonald has been a member of the Law Society of Upper Canada for over 11 years. She had intervened, in her words, as a liaison with the union on behalf of the applicant. That stopped when a member of the union executive reported her to the Law Society. Previously she had attended meetings with the employer and union on behalf of the applicant. There is a factual dispute as to the underlying events. The Law Society matter was resolved and Ms. MacDonald withdrew from further active participation.
26Ms. MacDonald’s evidence was directed at the state of her daughter’s demeanor immediately following the mediation and the state of her health leading up to it. Although the applicant did not testify as to her state of being following the mediation, her mother testified that the applicant was crying, rambling and was visibly upset, clutching the settlement. Ms. MacDonald stated that she was particularly concerned given her daughter’s diagnosis and her own involvement with that diagnosis.
27At that stage of her examination in chief, counsel for the applicant sought to have Ms. MacDonald qualified as an expert in post-traumatic stress disorder. The basis of her qualifications were identified as an involvement in law over a period of thirty years (apart from eleven years in practice, this involvement was unclear) in a sub-specialty of mental health law. She testified that she had spent a good deal of time with medical personnel, particularly psychiatrists. She is an Associate Member of American Psychology and the Law, is involved with the Canadian Mental Health Association through her practice and she sits as a member of the Mental Health and Legal Issues Committee in Toronto. She is a member of the Canadian Bar Association and the Association of Trail Lawyers of Ontario. She presented a paper in 1992 to that Association distinguishing post-traumatic stress disorder from other symptoms. That paper arose out of a nine-moth civil fraud trial during which she had worked with an expert witness dealing with damage issues. She acknowledged she could not give a medical opinion but could provide an opinion on her understanding of the disorder and her observations.
28It was asserted that Ms. MacDonald be qualified as an expert essentially on the basis that she knew and understood more about the disorder than the Vice-Chair. The union argued there was insufficient basis to qualify her as an expert. Further, her ability to assist was complicated by the fact that she is the applicant’s mother. The trade union noted that qualified medical personnel had treated the applicant. In reply the applicant argued the relationship went merely to weight not admissibility and that the key issue was an assessment of her expertise.
29Following a short break I ruled that I was not satisfied that Ms. MacDonald qualified as an expert. The issue before me, about which expert evidence might be of assistance, is whether or not the applicant had the capacity to contract on August 13, 1998. In assessing the asserted expertise in post-traumatic stress disorder, I note that the evidence as to Ms. MacDonald’s membership in various organizations was simply that. There was no evidence of particular work or development of an expertise other than the reference to the paper prepared after working with an expert during the course of trial. That is insufficient. She acknowledged she could not provide a medical opinion. There was no evidence that she had treated the applicant.
30Ms. MacDonald did testify as to her observations of the applicant immediately following the mediation. She stated that her daughter expressed confusion as to the terms of the settlement, asserting that she thought the mediation was to deal with her grievance (which it did). The applicant believed that the Labour Board hearing was still alive and that the settlement dealt only with issues with the employer (this is also accurate). Ms. MacDonald testified that the applicant expected to get her job back or to proceed to arbitration pursuant to the claim against the union. She agreed that when she read the settlement it appeared clear that the applicant had resigned, was to receive severance, and that it resolved all employment issue including workers' compensation. She would not venture an opinion as to the meaning of the “without prejudice” clause and claimed no expertise in representing employers or unions or in interpreting the settlement document, although she agreed there seemed to be no doubt of a legal obligation by the employer to pay the amount of seven months severance. Ms. MacDonald did not provide the applicant with any advice regarding whether or not to accept the monies payable if she intended to get her job back.
31Following Ms. MacDonald's evidence, I adjourned the consultation briefly in order for the applicant to decide whether she wished to call further evidence. Upon reconvening counsel advised there would be no further evidence on behalf of the applicant. The union chose to call no evidence. Written submissions were directed and subsequently received and reviewed.
32On a review of the evidence, certain of the applicant’s responses strain credibility. While in cross-examination she acknowledged virtually all that the trade union asserted was explained to her at the mediation, including the options presented, in chief or reply she attempted to dissociate herself from any responsibility or understanding of the events.
33In cross-examination the applicant was asked when she first considered resolving these issues through a severance settlement. She replied that it was discussed on August 13, 1998, but that she didn’t want it, and had never really considered it. Yet she was aware and acknowledged that her prior counsel had written on her behalf in late 1997, asking the union to inquire into a severance package. She was also aware of and had consented to her counsel forwarding a letter dated December 9, 1997 to the employer wherein he proposed a severance package of twelve months. She acknowledged that a severance package had been presented to her as a viable option by her then counsel and that the Region had responded with an offer of seven months.
34The applicant testified that she saw Dr. Waldenberg for a period of a year and a half after the initial alleged assault on a weekly or biweekly basis. The corporate health form filed as Exhibit 3, and apparently completed on July 6, 1998 by Dr. Waldenberg contradicts that assertion. In response to a specific inquiry, Dr. Waldenberg confirms that he actively supervised the applicant’s care during the full period, but indicates it was on a monthly basis. In his letter dated August 1, 1997 he advises that he was then seeing her between every two to four weeks.
35The applicant testified in reply that she did not understand the alternative to rejecting the severance offer, contradicting her earlier testimony that the mediator had made clear her options and that the alternative was to proceed to arbitration to claim STD. At another point in her evidence she acknowledged that the union had discussed how difficult it would be to obtain STD or LTD based on the medical evidence; that arbitration was not a sure thing, and that the union had asked why she wanted to return to the workplace when she was so unhappy with the environment.
36The applicant testified that she did not think that the numbers comparing the STD amount payable to the severance amount payable were accurate. Yet there was no suggestion that she did not understand that the purpose of the comparison was to show her the relative benefits of the settlement offer.
37It appears that the applicant misunderstands the scope of section 74 and the relative jurisdiction of the Board and an arbitrator. Pursuant to section 48 of the Act it is the jurisdiction of an arbitrator to interpret the collective agreement. In this case it would be incumbent on an arbitrator to determine whether or not the applicant was entitled to STD benefits or, if the termination from employment had proceeded, whether the employer had just cause to terminate that employment. The issues are related as both concern the medical condition of the applicant. In order to claim sick benefits the applicant’s only alternative was to convince an arbitrator that she was entitled to those benefits. The options presented to her at the mediation were accurate. The jurisdiction of the Board is limited under section 74 to determining whether the trade union had acted in violation of the standard set out in that section in its representation of the applicant. The Board does not assess the employer’s conduct except insofar as it explains positions or actions taken by the union in response. The fact that the settlement may eclipse the outstanding complaint before the Board is not something that the union is obliged to communicate to the applicant. In that regard it is a party opposite. The protection is that the trade union cannot coerce or otherwise force a grievor into an untoward settlement in order to avoid section 74 proceedings. For the applicant to believe however that somehow she can recover damages from the trade union for entitlements issuing from the employer, in circumstances where it has not been established that she is entitled to anything, is simply a misconception of the nature of the obligations. Nor is it the trade union that has generated this misconception.
38The applicant also relied on paragraph 4 of the settlement to assert that because it was made without prejudice the Board can still refer the matter to arbitration. An order referring grievances to arbitration presupposes a finding that the trade union violated section 74, a matter not yet before me, given the preliminary issue raised by the trade union that I ought to exercise the discretion in section 96 of the Act not to inquire into this complaint. I note however that the parties to a grievance are the trade union and the employer. The trade union has carriage of the grievance as the applicant’s exclusive bargaining agent, subject to its statutory responsibility in section 74. The clause bears no relevance to the applicant. In labour relations matters, such clauses are regularly inserted so that neither party to the collective agreement can subsequently assert a certain result based on an earlier settlement of a claim. One must recall that the relationship between an employer and trade union is of an ongoing nature, unlike typical litigation where the parties generally have no further dealings with each other.
39The applicant asserted that some weight ought to attach to the fact that the union had subsequently added a reference to the second grievance at the top of the page of the settlement. It is irrelevant. The trade union acknowledged at the consultation that only one settlement document had been signed. The applicant acknowledged that she was aware that both grievances were to be dealt with at the mediation. Furthermore the settlement makes clear that it resolves all employment issues.
40Having heard the applicant’s evidence and having observed her demeanor at that time, I am of the view that she appreciated the events of August 13, 1998 at the time and was capable of entering into the settlement. It would be a rare grievor who was not nervous, who had not lost sleep in anticipation of a mediation, who did not feel varying ranges of anxiety during that process. Those symptoms however do not necessarily interfere with one’s ability to understand and make choices. There is always pressure in a mediation process in that the alternative is litigation, often an even more anxiety-producing process. Evidence of such symptoms cannot, in the absence of other evidence, equate to capacity.
41The applicant relies on the medical reports. The letter of August 1, 1997 indicates that the applicant suffered from acute post-traumatic stress disorder in February 1997. Dr. Waldenberg put the applicant on anti-depressant medication, which he notes was not helpful. In August 1997 he attributes the applicant’s lack of progress to the intransigent line taken by the employer in denying any significant problem at work. In July 1998 Dr. Waldenberg notes the applicant’s condition as one of major depression and post traumatic stress disorder and suggests a change in location might be helpful, a reference apparently to a change in work location. There is no anticipated date for a return to work indicated. The August 10, 1998 letter is three lines long and merely states that the diagnosis and prognosis regarding the “work related problem” remains the same as in August 1997 and July 1998.
42That medical information even as of August 10, 1998, three days before the mediation, says nothing of the applicant’s capacity to participate in the mediation or to understand or enter into a settlement. At its highest it says she should not return to work given that there appears to be no change to that environment satisfactory to the applicant’s needs. There is no medical evidence before me with respect to the issue of the applicant’s capacity to enter into the settlement.
43It is worth noting that following the settlement in August 1998 it appears that the applicant stopped taking anti-depressant medication and there was no evidence that she continues to see Dr. Waldenberg on any regular basis. She does now attend a naturopath for asserted ongoing medical problems although notes that there has been no cause for her to attend at her family doctor as she suffers no physical ailment.
44Counsel for the applicant asserted that the union should have inquired into the applicant’s mental state before proceeding with the mediation; that they knew or ought to have known that the external presentation by the applicant did not conform to her mental state. The union could not reasonably have known of any alleged problem from a review of the medical documents, as they do not speak to her capacity to understand and enter into a settlement of these claims. Her conduct at the mediation belied any need to inquire. There had been no suggestion that the applicant might not be able to fully participate in the mediation. Nor did anyone on her behalf suggest that the applicant might not be capable of participating in this process.
45The applicant conducted herself on August 13, 1998 so as to give every indication that she fully understood and was capable of dealing with the mediation and entering into the settlement. She understood that her grievances were to be dealt with, she understood the purpose of the comparison of numbers, and she advanced the fact that the employer had offered severance and asked if an increase to that offer could be pursued. She requested that a letter of reference be included as part of any settlement. She asked for a break in order to obtain advice. This conduct belies any notion of incapacity to enter into the settlement. She acknowledged in cross-examination that she understood the terms of the settlement although she also asserts otherwise. Yet her responses and demeanor in giving her evidence gave every indication that she did understand at the time. It was only when she attempted to suggest otherwise that her evidence became less than clear.
46It was not asserted at the consultation or in the material filed prior to reconvening, that the settlement be set aside either on the basis of any improper conduct at the mediation on the part of the trade union, or on the basis that the settlement was so untoward that it must be set aside. Thus the trade union did not respond to such assertions directly. The only basis for setting aside the settlement was an asserted lack of capacity. There was however, some suggestion in the applicant’s written submissions filed after the consultation that these issues formed a basis for setting aside the settlement. The applicant had ample opportunity to plead any other ground following the adjournment of the first day of the consultation. Any suggestion that I deal with this matter on either basis is properly dismissed for that lack of pleading and consequent loss of opportunity for the trade union to respond.
47There was, in any event, no evidence of any coercive or untoward behaviour on the part of the representatives of the trade union at the mediation. At most the applicant asserted that she felt unsupported, that it was hopeless. I note that while the applicant felt that her grievances were being pre-judged, the union has some obligation to advise a grievor as to the risks and likelihood of success, or not, of any grievance, and to canvass the options available that might result in some satisfaction to a grievor. And it is clear that she was presented with her options. They advanced her request to seek a higher severance amount and a letter of reference, with limited success. There was no suggestion that the trade union was refusing to proceed to arbitration had she declined the settlement. Relative costs and benefits were reviewed. She was allowed time to seek other advice.
48The applicant also asserted that the Board is not in a position to assess the reasonableness of the settlement. I note that even had the applicant sought to set aside the settlement on the basis of its terms, reasonableness may well not be the standard of review. This settlement does fall within reasonable parameters however. The applicant had two options; to accept a settlement that included severance pay or proceed to arbitration to establish her claim to STD benefits. There is always a risk that one might lose an arbitration. The applicant was relying on a diagnosis of post traumatic stress syndrome arising out of an incident in early 1997. The employer disputed that incident and the extent of any trauma arising out of it. While not all of the details of the various plans were before me, the general parameters of certain benefits are well known in the labour relations community. Here, STD benefits appear to run for a period of 26 weeks and likely pay a percentage of her salary. After that the applicant would be required to apply for LTD benefits if she could not return to work. That is a more rigorous application requiring the applicant to establish that she is permanently disabled. It is likely that that application involved a process with an insurance company and not the employer. The applicant expressed doubts about returning to the workplace and the medical information concluded that she was not capable of returning to the workplace. Her counsel had suggested a severance package as a viable alternative. The only issue in doubt was the amount of such a package. The union compared the numbers and took the position that the applicant would receive more money in severance than she would under the STD plan. Notwithstanding her assertion that she believed the numbers might be inaccurate, there was no suggestion that the applicant did not have the opportunity to review those numbers and ask questions about them. Seven months salary does however seem likely to amount to more than 26 weeks (6 months) of a percentage of salary. Pension, I note, is a separate issue.
49The trade union relied on Chitty on Contracts (27th ed., 1994) as setting out the appropriate standard for assessing capacity as follows:
In the case of contracts other than for necessaries, the general rule is that a mentally disordered person is bound by his contract unless he can show that owing to his mental condition he did not understand what he was doing, and further that the other party was aware of his incapacity. But if these two conditions are satisfied, the contract is voidable at his option….
… The understanding and competence required to uphold the validity of a transaction depend on the nature of the transaction. There is no fixed standard of sanity which is requisite for all transactions. What is required in relation to each particular matter or piece of business transacted, is that the party in question should have an understanding of the general nature of what he is doing. (at pages 463 –464)
50I accept this as an appropriate characterization of the test. To the extent that a party to a settlement is required to be aware of the incapacity I note that this includes the employer as well as the trade union. The employer had specifically rejected any medical condition. There was no indication to the employer on August 13, 1998 that the applicant was in any way disadvantaged in her ability to understand the nature of the proceedings or her role and available choices.
51I find that the applicant has not established that she lacked the capacity to enter into the settlement on August 13, 1998. That settlement resolved all employment issues with the Regional Municipality of Hamilton-Wentworth in exchange for a payment of severance and a letter of employment. There is no dispute that the applicant received the benefit of the settlement dated August 13, 1998 and that she did not seek to repudiate that settlement until March 1999, even in the face of the availability of counsel’s advice.
52The Board is extremely reluctant to overturn a settlement where the benefit of that settlement has been accepted. See generally Dennis Leonard [1990] O.L.R.B. Rep. May 575; Unal Duran [1989] O.L.R.B. Rep. Aug. 1068; Coalition of Laid-off Workers [1990] O.L.R.B. Rep. Oct. 1019; and Mary Borsboom, unreported decision dated June 3, 1992.
53In this case there is no overriding reason to set aside the settlement. Given that the settlement expressly resolves all employment issues with the employer, there is no labour relations purpose served by inquiring into the trade union’s conduct in respect of its obligation under section 74 of the Act. The real potential remedy, an order directing that the grievances proceed to arbitration, is one not available to the Board in light of the settlement.
54For these reasons I hereby exercise the discretion under section 96 of the Act to decline to inquire into this application. The application is therefore dismissed.
“M. A. Nairn”
for the Board