3612-98-R United Brotherhood of Carpenters and Joiners of America, Local 1946; and Carpenters & Allied Workers Local 27, United Brotherhood of Carpenters and Joiners of America, Applicants v. Cypress Millworks Ltd., P.E.G. Interiors Inc. and Scispress Millwork Ltd., Responding Parties.

BEFORE: D. L. Gee, Vice-Chair.

APPEARANCES: Doug Wray and Brian McKnight for the applicants; David Cowling, David DeFrancesco and Peggy Rizos for P.E.G. Interiors Inc.; no one appeared on behalf of Cypress Millworks Ltd. or Scispress Millwork Ltd.

DECISION OF THE BOARD; August 29, 2000

1This matter is an application pursuant to sections 69 and 1(4) of the Labour Relations Act, 1995 (the "Act").

2The responding parties Cypress Millworks Ltd. ("Cypress") and Scispress Millwork Ltd. ("Scispress") did not file a response or appear at the hearing. Peggy Rizos, who was called as a witness on behalf of P.E.G. Interiors Inc. ("PEG") was the sole witness to testify in this matter.

3The facts of this matter are not largely in dispute. Peggy Rizos testified with respect to the creation and operations of the responding parties in a forthright manner. Her evidence is not challenged. The issue for determination is whether the facts as presented by way of the documentary materials and Peggy Rizos' oral testimony establish that a sale of a business and/or a related employer declaration should be made.

4Peggy Rizos was born in Greece where her father had a construction company. Her father took her to construction projects with him. When Peggy was 21 years old she came to Canada. Peggy acquired a master's degree in Political Science and International Law and then returned to Greece.

5Peggy married George Constantinou and returned to Canada in 1981. George Constantinou is a lawyer by training but was unable to find work in his field. He eventually turned to carpentry to earn a living. From approximately 1984 through to 1990, George was engaged as a subcontractor to Tridont Dental installing cabinetry in a chain of storefront medical and dental clinics. During this same time period Peggy was

managing a Swiss Chalet Restaurant. From time to time, Peggy would attend with George at a job and assist him with the installation of millwork. It is estimated that Peggy assisted George in this fashion 10 to 15 percent of his working time. In addition, Peggy prepared invoices and did accounting on George's behalf. Finally, Peggy had some involvement with estimating by reviewing a set of drawings and calculating the number of hours that would be required to install the millwork.

6In or about 1990, Tridont Dental went into receivership. Thereafter, George worked off and on, until approximately 1993, for other companies fabricating and installing millwork. Peggy did not work outside of the home during this period of time.

7In 1993, Peggy's brother, Andrew Rizos, started up Cypress Millworks Ltd. George went to work for Cypress on a full-time basis. On March 18, 1993, Andrew, on behalf of Cypress, entered into an agreement with Carpenters & Allied Workers Local 27 United Brotherhood of Carpenters and Joiners of America ("Local 27") pursuant to which Cypress became bound to the Carpenters Provincial ICI Collective Agreement and to Collective Agreements between Local 27 and the Toronto & District Carpentry Contractors Association and the Ontario Carpentry Contractors Association.

8Andrew, George and Peggy were the directors of Cypress. Andrew was the President and Secretary and Peggy was the Treasurer. Cypress was engaged in millwork fabrication and installation. George's title was Manager of Operations. He did anything and everything including estimating, working in the shop and supervising the employees. Cypress employed three employees in the fabrication shop and possibly additional employees to do the installation. George received a percentage of the company's profits.

9Peggy worked for Cypress on a part-time, "as needed" basis. She estimated that she worked seven to 10 hours a week although there may have been weeks that she worked as many as 20 hours. She did not receive any compensation until the end of the year when she was given a lump sum of $10,000 or $15,000. Peggy spent approximately 15 to 20 percent of her working time doing accounting functions. She attended approximately one site meeting a week and estimated about two jobs a month.

10At the end of 1995, Andrew returned to Greece and shortly thereafter advised Peggy and George that he would not be returning to Canada. The operations of Cypress came to an end. George purchased Cypress' equipment and fax machine. George incorporated Scispress on May 22, 1996, intentionally adopting a name that sounded similar to Cypress. He arranged to keep Cypress' phone and fax number. Scispress likely obtained work from customers calling the number to reach Cypress. Aside from Peggy, George did not hire any of the employees who had been working for Cypress. George was the sole officer and director of Scispress.

11Peggy went to work full-time for Scispress. She was paid $2,500 some months, when there was money, and some months she received nothing. George hired a secretary who did the accounting so Peggy's role at Scispress was limited to attending at site meetings and doing some estimating. The contracts acquired by Scispress were described as "a lot larger" than those of Cypress.

12In late 1997, Peggy decided that her marriage to George was not going to last. They had separated on a previous occasion for a year and a half. Peggy decided that she needed to come up with a job. Peggy has always been around construction and enjoys it. A family friend by the name of Edward Makauskas encouraged her to start her own construction company. Edward, who is an architect and thus has considerable construction contacts, offered to go into partnership with her in the formation of a

company that would act as a general contractor and/or construction manager. As a result of such discussions, on February 23, 1998, PEG Interiors Inc. was incorporated. Peggy and Edward were equal partners. Peggy was the President, Secretary and a Director. Edward was a Director and the Treasurer. The arrangement was that Peggy would be paid $1,500. per week when she was supervising a job and the company's profits would be equally divided.

13Peggy describes PEG's business as construction management. PEG's largest jobs have in fact been construction management jobs, however, PEG has also acted as a general contractor. PEG commenced its first job in April, 1998.

14PEG uses Scispress' mailing address and phone number. Peggy carries a cell phone with her at all times and receives the vast majority of her calls on her cell phone. On each project, PEG is required to set up a phone and fax line which is maintained for the currency of the job and discontinued at the end. PEG has an office in Peggy's home. Peggy rarely goes to Scispress' office. She does pick up her mail at Scispress' office and PEG has used George's secretary at Scispress to type up invoices and some letters for which it is not charged.

15PEG employs no employees. All of the work is subcontracted out. At the end of February or early March, 1999, Edward left the business and transferred his shares to Peggy.

16Peggy testified with respect to the projects PEG has worked on since its incorporation. Having regard to the basis for my determination herein, it is not necessary to set out such evidence.

17As indicated above, the applicants have bargaining rights with Cypress Millworks Ltd. The applicants seek a sale of business declaration and/or related employer declaration in order to establish that their bargaining rights extend to Scispress and PEG.

18The relevant provisions of the Act provide as follows:

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.

2. (1) In this section,

"business" includes a part or parts thereof; ("entreprise")

"sells" includes leases, transfers and any other manner of disposition, and "sold" and "sale" have corresponding meanings. ("vend", "vendu", "vente")

DETERMINATIONS

19There are three preconditions that must be satisfied before the Board can turn its mind to whether it will exercise its discretion pursuant to section 1(4) of the Act and make a related employer declaration. The first two preconditions require that there be two or more entities that carry on associated or related businesses. There are clearly two or more entities at issue in the present case and accordingly the first precondition is met. With respect to the second precondition, PEG disputes that it is engaged in an associated or related business to Scispress or Cypress. Having regard to my determination with respect to the third precondition, it is not necessary for me to determine whether the second precondition has been met. I will assume for the purposes of this decision that it has been met.

20The third precondition is that the entities must be under common control or direction. The Board must be satisfied that Scispress and Cypress were under common control and direction in order for a related employer declaration to be made with respect to Scispress. The Board must be satisfied that either: Scispress and Cypress were under common direction or control and further that Scispress and PEG are under common direction and control; or that Cypress and PEG were under common direction and control, for a related employer declaration to be made with respect to PEG. It is my determination that, on the facts before me, this third precondition has not been met.

21In order to find common control and direction between Cypress and Scispress and in turn between Cypress and PEG or Scispress and PEG it would be necessary to conclude that George and/or Peggy were in a position of directing or controlling Cypress.

22The facts establish that both George and Peggy were directors of Cypress. Peggy was also an officer of Cypress. Both George and Peggy worked for Cypress. George was the Manager of Operations. His responsibilities included estimating, supervising the employees and working in the shop. Peggy worked for Cypress on a part time basis, seven to 10 hours a week. Her responsibilities included accounting, site meetings and estimating. Peggy received a lump sum at the end of the year, George received a percentage of the company's profits. There is no evidence with respect to the percentage of the estimates that were prepared by George and/or Peggy and whether either of them was responsible for the preparation of bids. The evidence does not inform the Board as to the nature of George's responsibilities in the course of supervising the employees. The Board does not know if George simply supervised their day to day activities or exercised the power to hire, fire and effect discipline. The evidence establishes that it was Andrew that formed Cypress. Prior to the creation of Cypress, George was earning a living moving from job to job. Peggy was not working. Andrew was the impetus behind the creation of Cypress. The evidence further establishes that Andrew was solely responsible for approving all estimates regardless of who prepared them.

23While factors such as holding a position of director and/or officer of a corporation, and the performance of estimating functions and supervising employees, are considered by the Board to be indicators that an individual is in a position of control, these factors are not determinative. They are considered by the Board in the context of all of the evidence. In the present case, given the evidence that suggests that Cypress was in fact Andrew's company and Andrew retained control over all estimates prepared by George and Peggy, combined with the lack of any evidence which would inform the Board as to the nature, extent and importance of the estimating and supervising functions performed by George and/or Peggy, I am not satisfied that the evidence before me establishes that either George or Peggy was in a position of control at Cypress.

24As a result of my determination that the third precondition for the issuance of a related employer declaration as between Cypress and Scispress or Cypress and PEG has not been met.

25I turn then to a consideration of the sale of a business application. The facts establish that, when Cypress ceased operations, George purchased Cypress' equipment and the fax machine. He made arrangements to keep Cypress' phone and fax number and likely acquired business as a result. George named his company "Scispress Millworks Ltd.", deliberately adopting a name that sounded like "Cypress Millworks Ltd.". Cypress and Scispress were engaged in identical operations, namely the fabrication and installation of millwork. I am satisfied that the evidence establishes that the genesis of Scispress' business was obtaining work intended for Cypress. Scispress performed this work using equipment obtained from Cypress. As a result, it is my determination that part of the business of Cypress was in fact transferred from Cypress to Scispress such that a sale of a business within the meaning of section 69 of the Act, from Cypress to Scispress, has occurred.

26Turning then to the issue of whether there has been a sale of a business from Cypress to PEG, it is my determination that the evidence does not support such a conclusion. As indicated above, I am not satisfied, based on the evidence before me, that Peggy was a key person at Cypress. Thus, Peggy's move from Cypress, through Scispress, to PEG, does not support a finding of a sale of a business. PEG now uses the fax number that was once Cypress'. There was, however, a gap of over two years between the time that the fax number was used by Cypress and the time PEG commenced using the fax number. Given that PEG entered a distinct area of the construction industry from that engaged in by Cypress (or Scispress) there is no basis for concluding that PEG benefited from using the number.

27I turn then to the question of whether there has been a sale of a business from Scispress to PEG or whether Scispress and PEG are related employers. The evidence is that Peggy was engaged full time for Scispress performing estimating functions and attending site meetings. The evidence does not, however, inform the Board as to the value or importance of the functions performed by Peggy. The Board has no evidence, such as number of estimates prepared by Peggy relative to the size of the company, whether she had the final say on the bid price, whether others in the company also had estimating responsibilities and if so, what Peggy's role was relative to theirs, upon which to determine the value of her role with Scispress. Further, the evidence establishes that, following Peggy's departure from Scispress, Scispress continued to operate. As a result of the lack of evidence going to the value of Peggy's functions to Scispress, and the evidence that Scispress was able to continue to operate after her departure, I am unable to conclude that Peggy was a key person while engaged at Scispress. As a result, I am unable to find common control and direction as between Scispress and PEG such that the related employer application as between Scispress and PEG must fail.

28The only evidence going to the issue of whether there has been a transfer of business as between Scispress and PEG, is the fact that PEG used Scispress' phone, fax and address and occasionally used George's secretary to perform some typing for which PEG was not charged. In the context of all of the evidence, including the evidence that PEG was active in an area of the construction industry distinct from that of Scispress, I am not satisfied that such is sufficient to establish that a transfer of business from Scispress to PEG has occurred. Accordingly, the application insofar as it relates to section 69 of the Act with respect to PEG fails.

29Having regard to the foregoing I make the following declarations:

(i) the application pursuant to section 1(4) of the Act is dismissed as against all of the responding parties;

(ii) the application pursuant to section 69 is dismissed as against PEG Interiors Inc. ;

(iii) a sale of a business from Cypress Millworks Ltd. to Scispress Millwork Ltd. within the meaning of section 69 of the Act has occurred;

(iv) Scispress Millwork Ltd. is bound to the Carpenters Provincial Collective Agreement and the Collective Agreements between the Carpenters & Allied Workers Local 27, United Brotherhood of Carpenters and Joiners of America and the Toronto & District Carpentry Contractors Association and the Ontario Carpentry Contractors Association.

"D. L. Gee"

for the Board