United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada Ontario Pipe Trades Council et al. v. The Foundation Company of Canada Limited et al., 2001 CanLII 11775

United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada Ontario Pipe Trades Council et al. v. The Foundation Company of Canada Limited et al.

File No.: 2872-98-R Date: July 3, 2001

Before: David A. McKee, Vice-Chair.

Appearances: Stephen B. D. Wahl and Brian Christie for the applicants; Carl Peterson and Brian Swartz for the responding parties.

DECISION OF THE BOARD

1. This is an application under subsection 1(4) and section 69 of the Labour Relations Act, 1995, S.O. 1995, ch. 1 (“the Act”). The application was filed on November 20, 1998. The original responding parties were identified as The Foundation Company of Canada (described as consisting of itself and eight other corporations); BFC Construction Group Inc. (described as consisting of eleven other corporations); BFC Industrial – Nicholls-Radtke Limited and BFC Construction Corporation. At the date of the first day of hearing into this matter, May 8, 2001, there was only one corporation in existence: BFC Construction Group Inc. (“BFC-CGI”). All of the responding parties had been amalgamated into that one corporation. This act of corporate amalgamation occurred after the application had been filed.

2. BFC-CGI is a conglomeration of a large number of construction companies. These companies were originally independent companies which had been acquired by what is now BFC-CGI over the years. At the risk of gross over-simplification, the companies included the “Foundation” companies and the “Banister companies” (alleged to be involved in heavy construction and road construction), the Cliffside companies (utility contractors), the Majestic and Cliffside (pipelines), Jackson-Lewis company (an ICI general contractor), Nicholls-Radtke Limited (an industrial contractor) and other companies involved in the construction of nuclear power plants. Some of these companies have been in existence for a long time. The Foundation Company of Canada Limited was incorporated in 1924. The Jackson-Lewis Company Inc. was incorporated on April 2, 1913. Nicholls-Radtke Limited was incorporated at some time in the early 1960’s. Although counsel for the responding parties did not describe them in any great detail, it appears that BFC-CGI takes the position that, although it is now at law a single corporation, it carries on several businesses through its various divisions. The focus of the parties’ attention at this stage of the argument was on two divisions: BFC Industrial (“BCF-I”), alleged to be essentially the business of Nicholls-Radtke Limited and BFC Buildings (“BFC-B”), alleged to be essentially the business of Jackson-Lewis. The other divisions were not described in any detail.

3. The applicant traces its bargaining rights from collective agreements with three different corporations ultimately amalgamated into BFC-CGI: The Foundation Company of Canada Limited, Nicholls-Radtke Limited, and A.D. Ross & Company Limited. There is no dispute that each of these corporations was bound to one or more collective agreements with the applicant. A.D. Ross & Company Limited was amalgamated with The Foundation Company of Canada in a corporation named The Foundation Company of Canada on June 27, 1980. This was itself amalgamated with BFC-CGI on January 1, 2001. Nicholls-Radtke Limited was amalgamated with BFC-CGI on January 1, 1999.

4. In tracing the various amalgamations of the many corporations ultimately amalgamated into the BFC-CGI, the parties referred to both the Canada Business Corporations Act (“CBCA”) and the Ontario Business Corporations Act (“OBCA”). However, all of the amalgamations relevant to this decision, and certainly those described above, took place under the CBCA. I infer that from the fact that the resulting amalgamated corporation is always described as incorporated under the CBCA. Amalgamation can only take place under the CBCA if both pre-amalgamation corporations are incorporated under that statute (even if one of them was “exported” from a provincial jurisdiction to the federal one immediately prior to amalgamation). However, the parties argued that the effect of amalgamation was the same under either statute.

5. There are four collective agreements which are alleged to be binding on the “successor” employer: the provincial collective agreement in the ICI sector of the Province of Ontario, a “utility collective agreement”, the National Standard Agreement for Pipe Fabrication, and the collective agreement between the applicant and the Electrical Power Systems Construction Association (“EPSCA”) which also has a province-wide scope.

6. The parties put before the Board a single question, on the basis that resolution of the issue in favour of the union would end the inquiry entirely (although the reverse is not true). The positions of the parties are essentially these. The applicant (the “Union”) says that a corporate amalgamation constitutes a sale of a business. Since there is now only one legal entity, i.e. BFC-CGI, the union’s collective agreement binds BFC-CGI in its entirety throughout the geographic scope of the agreements.

7. BFC-CGI asserts that this is not necessarily the result of these few facts. It concedes that the Board might on all the evidence find a sale of business had occurred as described by the applicant or that a related employer declaration might be appropriate. However, BFC-CGI takes the position that it has in fact preserved the existence of separate “businesses” in the construction industry. That is, BFC-I and BFC-B are just as independent of one another as when they existed in the corporate form of Nicholls-Radtke Limited and Jackson-Lewis Company Inc. It asserts that the collective agreements are binding only on the divisions which were originally Nicholls-Radtke (or the Foundation Company) and do not bind the other divisions or “businesses” of the corporation. That is, the responding parties assert that the effect of section 69 is not as simple or mechanical as the applicant asserts.

8. Much emphasis was placed in argument of the provisions of the CBCA and the OBCA. The relevant provisions of the CBCA are:

9. Amalgamation. – Two or more corporations, including holding and subsidiary corporations, may amalgamate and continue as one corporation.

185.(4) Certificate of amalgamation – On receipt of articles of amalgamation, the Director shall issue a certificate of amalgamation in accordance with section 262.

186. Effect of certificate. – On the date shown in a certificate of amalgamation

(a) the amalgamation of the amalgamating corporations and their continuance as one corporation become effective;

(b) the property of each amalgamating corporation continues to be the property of the amalgamated corporation;

(c) the amalgamated corporation continues to be liable for the obligations of each amalgamated corporation;

(d) an existing cause of action, claim or liability to prosecution is unaffected;

(e) a civil, criminal or administrative action or proceeding pending by or against an amalgamating corporation may be continued to be prosecuted by or against the amalgamated corporation;

(f) a conviction against, or ruling, order or judgment in favour of or against, an amalgamating corporation may be enforced by or against the amalgamated corporation;

(g) the articles of amalgamation are deemed to be the articles of incorporation of the amalgamated corporation and the certificate of amalgamation is deemed to be the certificate of incorporation of the amalgamated corporation.

For corporate purposes, the effect of amalgamation was described by the Supreme Court of Canada in R v. Black & Decker Manufacturing Co. Ltd. 1974 CanLII 15 (SCC), 43 D.L.R. (3d) 393 (S.C.C.):

… Whether an amalgamation creates or extinguishes a corporate entity will, of course, depend upon the terms of the applicable statute, but as I read the Act, in particular s. 137, [now section 186] and consider the purposes which an amalgamation is intended to serve, it would appear to me that upon an amalgamation under the Canada Corporations Act no “new” company is created and no “old” company is extinguished. The Canada Corporations Act does not in terms so state and the following considerations in my view serve to negate any such inference: (i) palpably the controlling word in s. 137 is “continue”. That word means “to remain in existence or in its present condition” – Shorter Oxford English Dictionary. The companies “are amalgamated and are continued as one company” which is the very antithesis of the notion that the amalgamating companies are extinguished or that they continue in a truncated state; (ii) the statement in s. 137(13)(b) that the “amalgamated company possesses all the property, rights …”. If corporate birth or death were envisaged, one would have expected to find, in the statute, some provision for transfer or conveyance or transmission of assets and not simply the word “possesses”, a word which re-enforces the concept of continuance; (iii) letters patent of amalgamation are obtained for the purpose of “confirming the agreement” (s. 137(11)), in marked contrast to letters patent of incorporation which expressly create a body corporate and politic; (iv) the French version of s. 137(1), perhaps better than the English version, serves to express what has occurred, “Deux ou plus de deux compagnies, … peuvent fusionner et continuer comme une seule et meme compagnie”. The effect is that of blending and continuance as one and the self same company; (v) the Act contains a number of express provisions whereby the life of corporate creations may be terminated – videlicet where a company carries on business not within the scope of its objects (s. 5(4)), or forfeits its charter (s. 31), or surrenders its charter (s. 32), or is dissolved (s. 133(11)). The Act is silent on the extinction of companies by amalgamation; (vi) if Parliament had intended that a company by the simple expedient of amalgamating with another company could free itself of accountability for acts in contravention of the Criminal Code or the Combines Investigation Act or the Income Tax Act, I cannot but think that other and clearer language than that now found in the Canada Corporations Act would be necessary.

The word “amalgamation” is not a legal term and is not susceptible of exact definition: Re South African Supply & Cold Storage Co., [1904] 2 Ch. 268. The word is derived from mercantile usage and denotes, one might say, a legal means of achieving an economic end. The juridical nature of an amalgamation need not be determined by juridical criteria alone, to the exclusion of consideration of the purposes of amalgamation. Provision is made under the Canada Corporations Act and under the Acts of the various Provinces whereby two or more companies incorporated under the governing Act may amalgamate and form one corporation. The purpose is economic: to build, to consolidate, perhaps to diversify, existing business; so that through union there will be enhanced strength. It is a joining of forces and resources in order to perform better in the economic field. If that be so, it would surely be paradoxical if that process were to involve death by suicide or the mysterious disappearance of those who sought security, strength and, above all, survival in that union. Also, one must recall that the amalgamating companies physically continue to exist in the sense that offices, warehouses, factories, corporate records and correspondence and documents are still there, and business goes on. In a physical sense an amalgamating business or company does not disappear although it may become part of a greater enterprise.

Counsel also relied on Stanward Corporation et al v. Denison Mines Ltd. (1968) 67 D.L.R. (2d)

743 (S.C.C.); Witco Chemical Co. Canada Ltd. v. Town of Oakville et al (1974) 1974 CanLII 7 (SCC), 43 D.L.R. (3d) 413 (S.C.C.); and Loeb Inc. v. Cooper, Cooper and Cooper (1991) 1991 CanLII 7219 (ON CTGD), 5 O.R. (3d) 259 (Ont. Ct. Gen. Div.); and Zurich Canadian Holdings Ltd. v Questar Exploration Inc. [1999] A.J. No. 609.

9. Both counsel spent considerable time on the provisions of the CBCA and the OBCA and decisions of various levels of court on the effects of amalgamation. As counsel for the union pointed out, there are few such cases and they arise only in the context of criminal or quasi-criminal charges and disputes arising under a lease. That in itself points out the limitation of this line of analysis. The Board is not given a mandate to interpret and apply the CBCA. It does have the mandate to apply section 69 of the Act. It is the meaning of the words “sale”, “business”, “collective agreement” or “like bargaining unit”, “person” and “employer” that the Board must give meaning to in interpreting and applying the Act.

10. Counsel for the Union argues that cases such as Dayco (Canada) Ltd. v. National Automobile, Aerospace & Agricultural Implement Workers Union of Canada (1990) 1990 CanLII 6619 (ON CA), 74 O.R. (2d) 648 and Ontario Legal Aid Plan v. OPSEU (1991) 1991 CanLII 7201 (ON CA), 6 O.R. (3d) 481 (C.A.) (the “OLAP case”) require the Board to apply, strictly and correctly, any law arising from any other source. He asserts that, whatever the Board does with the Labour Relations Act, it must import into its reasoning a correct interpretation of any other statute or doctrine of law. With respect, that is not quite what the OLAP case says. In that case the Board found that the Clinic Funding Committee of the Law Society of Upper Canada was involved in the affairs of certain legal clinics to such an extent as to permit the Board to declare it a related employer to those clinics. The criticism of this decision by the Ontario Court of Appeal was:

Thus, it was argued before this Court that the Board had simply recognized, for the purposes of its enabling statute only, that OLAP was acting qua employer to the employees of the individual clinics. However, the Board’s disclaimer notwithstanding, it is apparent that the declaration that OLAP is a single employer along with the directors of the clinics brings about a fundamental change in OLAP’s relationship with the clinics and, in particular, with the employees in that clinic. OLAP, or more properly the Committee, is charged with the responsibility of recommending to the provincial treasury the funding of these community clinics on an ongoing basis. It has the further responsibility of monitoring the activities of the clinics to ensure that the monies so provided are properly expended and that a suitable standard of legal services is provided. This requires staff of the Committee, who are employees of the Law Society, to become closely involved in the day-to-day activities of the clinics. That they do so is evidenced by the findings of the Board, but it is an error to interpret this authorized intrusion into the clinics’ affairs as constituting an employer-employee relationship. (page 491) [emphasis added]

That is, the Court of Appeal found the Board committed an “error” amounting to a patently unreasonable decision in looking at certain facts without looking at the context in which they occurred or the reasons why the committee was required to act (i.e. the relevant regulation under the Law Society Act). After citing McLeod v. Egan 1974 CanLII 12 (SCC), [1975] 1 S.C.R. 517, the Court went on to say:

Thus, in refusing to consider the legal effect of the regulation, passed under the authority of the Legal Aid Act, in making its determination, the Board, in my opinion, erred in the exercise of its authority to the point of making a patently unreasonable interpretation of its own duties under its enabling legislation. (page 495) [emphasis added]

That is a very different proposition from that argued by counsel for the union: i.e. that the CBCA defines for all purposes, including section 69 of the Labour Relations Act, what the legal effect of amalgamation is.

11. That is not to say that the CBCA is irrelevant, or that caselaw under it does not inform to a very great extent the Board’s interpretation of section 69. Corporations are, and (except for a few royal proclamations in the seventeenth century) always have been, purely statutory creations. It is statutes like the CBCA which define the nature and existence of corporations and acts such as amalgamation. The Board must be cognizant of the nature of the transaction which is occurring to determine whether or how the Act applies to that transaction. In the end, however, the Board is interpreting and applying the Labour Relations Act, 1995. The fact that the transaction examined is a statutory process under the CBCA is no different conceptually from an analysis of a complex arrangement of contractual and conveyancing relationships which may or may not constitute a sale of business. The Board must examine the commercial activity, which will inevitably involve an examination of the legal effect of the transaction. In the end, the only question of law which the Board must answer is whether or not section 69 applies to the transaction.

12. The responding parties in their argument went too far in the other direction. They argued that the Board’s task in applying section 69, and indeed subsection 1(4), is to determine whether relief is required to protect the union’s bargaining rights, and to consider whether the relief sought by the union would have the effect of expanding its bargaining rights. In doing so, the responding parties argued that the Board should look at the labour relations realities, and not be concerned with matters of corporate form. To be fair, this argument was grounded to some extent in the CBCA. Counsel argued that the amalgamated corporation is a “continuation” of the previous corporations which, in counsel’s argument, should retain all of its pre-existing rights, including, for BFC-B, the right to subcontract to non-union plumbing contractors. However, in asserting the almost exclusive emphasis on labour relations issues, the argument of the responding parties loses sight of the provisions of section 69. The section requires the Board to examine a transaction and determine if it is a sale. Unlike subsection 1(4), the Board is not given a discretion to make declarations; it simply determines whether the definition applies. If it does, the Act specifies the consequences.

13. It is worth quoting the relevant portions of section 69:

14. (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")

(2) Where an employer who is bound by or is a party to a collective agreement with a trade union or council of trade unions sells his, her or its business, the person to whom the business has been sold is, until the Board otherwise declares, bound by the collective agreement as if the person had been a party thereto and, where an employer sells his, her or its business while an application for certification or termination of bargaining rights to which the employer is a party is before the Board, the person to whom the business has been sold is, until the Board otherwise declares, the employer for the purposes of the application as if the person were named as the employer in the application.

(3) Where an employer on behalf of whose employees a trade union or council of trade unions, as the case may be, has been certified as bargaining agent or has given or is entitled to give notice under section 16 or 59, sells his, her or its business, the trade union, or council of trade unions continues, until the Board otherwise declares, to be the bargaining agent for the employees of the person to whom the business was sold in the like bargaining unit in that business, and the trade union or council of trade unions is entitled to give to the person to whom the business was sold a written notice of its desire to bargain with a view to making a collective agreement or the renewal, with or without modifications, of the agreement then in operation and such notice has the same effect as a notice under section 16 or 59, as the case requires.

14. In the end, the real contest among these parties is not over whether there has been a sale of a business, but on whom or what the consequences of the sale are binding. Although both counsel argued the case as if the issue of the definition of a sale of a business and the identity of the successor employer were the same question, they are not. The first question is whether the corporate amalgamation is a transaction which constitutes a sale or transfer under section 69. As will be seen, it clearly is. The second and different question is the identity of the “person” to whom the business is sold. There are certain consequences which are automatic upon the declaration of a sale of business. If there has been a sale, by definition there is a “person” to whom it has been sold. Once that person is identified, the collective agreements are binding on him or her. What this case is really about, however, is the identity of the “person” to whom the business was sold.

15. As the applicant points out, a corporate amalgamation has been found to be a sale of a business for the purposes of section 69 many times. That is, that type of commercial and statutory transaction constitutes a sale or transfer of a business within the meaning of section 69. See for example: Longyear Canada, [1979] OLRB Rep. March 225; New Dominion Stores, [1993] OLRB Rep. May 473; Ontario Paving Construction Limited, [1993] OLRB Rep July 630; and Accomodex Franchise Management Inc., [1993] OLRB Rep. April 281. The rationale for this finding is similar to the rationale which led to the same result in a related employer application, Plastics CMP Limited, [1986] OLRB Rep. Dec. 1761:

Unless there is some question of the authenticity or effectiveness of these Articles of Amalgamation, it appears that a declaration under subsection 1(4) would be entirely unnecessary. The three corporations in question have become one corporation and, hence, one employer, for all purposes including the purposes of the Labour Relations Act. Unless either of the other parties to these proceedings advises the Board that it takes issue with the authenticity or effectiveness of the Articles of Amalgamation or with the legal conclusion we have drawn on the basis of section 178(b) of the Business Corporations Act, 1982, it does not appear necessary for the Board to entertain the application under subsection 1(4) of the Labour Relations Act (hereafter “the Act”).

While the responding party resists this analysis, it did so only because it seeks to avoid the effect of the finding that the applicant asserts must follow. It does not resist, and indeed urges on the Board, that it find the sale of a business from Nicholls-Radtke Limited, but only to BFC-I, a Division of BFC-CGI.

16. The union says that BFC-CGI in its entirety is bound to the collective agreement. It referred to cases such as Urban Electrical Contractors, [2000] OLRB Rep. Oct. 1041 wherein the Board said:

17. Where a sale or transfer of all or part of a business takes place but there is no intermingling of employees, the Board has no discretion as to what follows. Section 69(2) stipulates that where an employer that is bound to a collective agreement sells his business, the person to whom the business is sold, is bound by the collective agreement as if the person had been a party thereto. The Board does not have the power to nullify the collective agreement, redefine bargaining units, change bargaining representatives or amend the collective agreement. Having regard to the extremely restricted scope of the Board’s powers under section 69 where there has been no intermingling of employees, there is no purpose to be served by the Board directing a representation vote.

As is evident from a reading of the entire decision in Urban Electrical Contractors, the Board was dealing with whether or not it had the authority to hold a representation vote in that case, not with the issue raised in this one.

17. Further, the union points to subsection 69(2) which provides that: “…the person to whom the business has been sold is … bound by the collective agreement as if the person had been a party thereto…”. In this case the union asserts that the “person” is BFC-CGI because, in counsel’s submission, a division cannot be a person because a division has “no juridical existence”. Thus, in the union’s view, the pre-existing collective agreement with Nicholls-Radtke binds the entirety of the “person” of BFC-CGI. Counsel for the applicant acknowledges that parties can and do agree to define bargaining rights in terms of a division of a company. That, he argues, is the private act of the parties which is neither sanctioned nor prohibited by the statute. That is, the parties are free to organize their affairs as they choose. The Board, however, is limited to the provisions of the statute. Counsel asserts that the Union has never agreed to limit its bargaining rights for Nicholls-Radtke to a division. Since the union had a collective agreement binding on the whole of Nicholls-Radtke Limited, covering the Province of Ontario, it is binding after a sale as defined in section 69, on the whole of the amalgamated corporation.

18. The responding parties’ first argument in response is one to which the Board gives no weight. The argument focuses on the use of the word “continue” in sections 181 and 186 of the CBCA. Counsel contends that the CBCA provides that Jackson-Lewis Company Inc. “continues” in the new amalgamated corporation which “possesses all of the property, rights, privileges, franchises and liabilities” of its predecessors (including Jackson-Lewis). These rights and privileges, counsel argues, include the right of Jackson-Lewis, now BFC-B to contract with other subcontractors without restrictions. The Board notes that the phrase “…possesses all the property, rights, privileges franchises and liabilities” is found in section 179 of the OBCA, but not in the CBCA, which is the relevant statute. More importantly, this argument ignores the fundamental nature of the transaction. The amalgamating corporations continue as “one corporation”. There is no statutory or judicial authority for the proposition that the amalgamated corporation is somehow simultaneously a single entity and a bundle of separate predecessors.

19. The responding parties’ more serious argument is the definition of what it is that is bound to the collective agreement. Counsel did not attempt to limit the geographic scope (province of Ontario) or the work jurisdiction (the whole of the relevant sector) of the collective agreements. He argues that they should apply only to the BFC-I Division, (which is the current business vehicle for the business which formerly carried on business as Nicholls-Radtke Limited) or to the BFC- Foundation division (the current business vehicle for business of the Foundation Company of Canada Ltd.). The responding parties relied heavily on a brief decision of this Board in dealing with two of the predecessor corporate groups of BFC, the Pitts companies and the Banister companies in Pitts Engineering Construction, [1983] OLRB Rep. June. 938:

20. The union seeks a Board declaration that Banister Continental Ltd. is the successor employer and that the union’s bargaining rights in respect of Pitts Engineering Ltd. and Pitts Atlantic Limited are now in respect of the employees of Banister Continental Ltd.; the remaining legal entity. The union argues that the declaration which it seeks would not result in an expansion of its bargaining rights as none of the other operating divisions of Banister employs carpenters or perform the work of the trade. Furthermore, the union asserts that the issuance of the declaration which it seeks is necessary to protect it from any further spin-off by Banister of a division which might perform the work of the trade with non-union tradesmen. The union argues that if it does not assert its claim now it might be found at a later date to have slept on its rights.

21. The respondents argue that to grant the declaration which the union seeks would result in an expansion of the union’s bargaining rights to cover all of the Banister operations. The respondents maintain that if the declaration sought was issued it could give rise to a number of jurisdictional disputes especially in respect of certain work performed by its Cliffside Division. Where, as in this case, the parent company had dealt with the union in a straightforward and honest manner and has never attempted to set up non-union divisions or subsidiaries for the purpose of undermining the union’s bargaining rights, and where the declaration which the union seeks would result in an expansion of the union’s bargaining rights with resultant jurisdictional disputes, the respondents take the position that the declaration which should issue in this case is that Pitts Engineering Construction, a division of Banister Continental Ltd. is the successor employer.

22. The Board has long held that the purpose of section 1(4) and section [69] is to preserve, not to extend, union bargaining rights. The union held bargaining rights for both Pitts Engineering Construction Limited and Pitts Atlantic Construction Limited. These companies now carry on business in Ontario as Pitts Engineering Construction, a division of Banister Continental Ltd. It is the bargaining rights in respect of this latter entity which are the subject matter of this application. We accept the submissions of the respondents that a declaration which confirms union bargaining rights beyond Pitts Engineering Construction, a division of Banister Continental Ltd. would constitute an extension of the union’s bargaining rights. Indeed, if this was an application for certification in respect of employees of Pitts Engineering Construction, a division of Banister Continental Ltd. it would not be open for the respondents to argue that the applicant union must show membership support sufficient to sweep all of the relevant employees in Banister Continental Ltd. The absence of carpenters or carpenters’ apprentices presently in the employ of either Banister or Cliffside does not in any way lessen the fact that a declaration that the union holds bargaining rights for Banister Continental Ltd. would constitute an extension of the union’s bargaining rights. Finally, neither section 1(4) nor section [69] is designed to deal with hypothetical corporate reorganizations or transactions. If in the future Banister creates another corporate entity to do some or all of the work presently performed through its Pitts Engineering Construction division, the union will be in a position to bring a section 1(4) application. The timeliness of that application will be determined on the basis of when that entity came into being and when the union could reasonably have been aware of its existence.

23. The question raised by the applicant is whether or not a division of a corporation can be a “person” for the purposes of section 69(2) or (3). The applicant says that it cannot be as it is not a “juridical person”, although counsel cited no authority for that proposition. Counsel for the responding party did not refer to any authority for the contrary proposition. The question does not appear to have been directly addressed by this Board before.

24. The word “person” is one capable of a myriad of meanings. Even leaving aside the application of statutes with statutory definitions of a “person” (e.g. the Criminal Code of Canada, The Bankruptcy and Insolvency Act, The Tradesmarks Act, etc.), the word may mean different things in very different or even slightly different contexts. Since 1930, it has been universally accepted that a “person” includes women (Edwards v. Canada 1929 CanLII 438 (UK JCPC), [1930] 1 D.L.R. 98 PC) although this was not the case previously (Re French (1911) 1912 CanLII 749 (BC CA), 1 WWR 488). There was still some controversy about whether or not lawyers were persons as late as 1981: Canadian Javelin Limited v. Canada (Restrictive Trade Practices Commission) 1980 CanLII 4216 (FC), [1981] 2 FC 82. A receiver, as receiver (regardless of its manner of organization) may be a person (Dauphin Planes Credit Union Limited v. Xyloid Industries Ltd. 1980 CanLII 186 (SCC), [1980] 1 S.C.R. 1182) or may not be (R v. Coopers & Lybrand Ltd. 1979 CanLII 4197 (FC), [1980] 1 FC 381. Minors and native people may or may not be persons in a wide variety of contexts. Unincorporated police commissions usually are a person (e.g. Police Commission of Calgary v. Calgary (City) [1986] ALTA LRBR 701 at 714-718, Metropolitan Toronto Commissioners of Police v. Ontario (Human Rights Commission) (1979) 1979 CanLII 1840 (ON HCJ), 27 O.R. (2d) 48 at pg. 52 (Div. Court). Perhaps the most useful example of this question is the analysis of whether or not a hospital is a person for the purposes of the Public Authorities Protection Act. In Schnurr v. Royal Ottawa Hospital 1986 CanLII 2536 (ON CA), [1986] 56 O.R. (2d) 589 (O.C.A.) the majority said:

The first question, then, is whether the defendant, a public hospital and a psychiatric facility is a “person” within the meaning of s-s. 11(1) of the Public Authorities Protection Act. It is argued on behalf of the defendant that by statute it has the power or authority to provide mental health services to members of the public in need of them and that it engages or employs professional staff in order to provide those services. It is my view, however, that the legislation does not contemplate that every person or legal entity that can point to a statute as the source of a power it enjoys or of authority to pursue its activities is a “person” within the meaning of s-s. 11(1) and thus protected by its Draconian limitation period. Unless required to do so by authority, in the light of the restrictive interpretation that must be given to the subsection, I would decline to extend it to a hospital that is not a government hospital, that is, to a hospital that has its own board of governors not answerable, in its day-to-day activities, to the government. There are, in contemporary Ontario society, many persons and corporations enjoying powers or authority derived from statutes. To give all of them the protection of s-s. 11(1) would be unjustifiable. If this means that a line must be drawn, I would draw it in such a way as to exclude from the protection of the subsection a public hospital such as the defendant. I add that counsel were unable to refer, and I was unable to find, any case in which a public hospital was held to be entitled to that protection.

22. A reading of the entire case, including the dissent, suggests that the word “person” is sufficiently elastic that the question might have been answered either way. The approach of both the majority and the dissent is a purposive analysis of the statute in which the word was found. The real issue for the court was whether the purpose of the statute was best served by including or excluding the hospital from coverage. In other words, the statutory context, rather than the vocabulary used, was determinative.

23. The Labour Relations Act, 1995 does not contain a definition of “person”. The Interpretation Act, R.S.O. 1990, ch. I-11 provides an inclusive rather than an exhaustive definition:

24. “person” includes a corporation and the heirs, executors, administrators or other legal representatives of a person to whom the context can apply according to law.

It is not apparent, however, that the word “person” has a single meaning even within the Labour Relations Act, 1995. Relying in part on the definition contained in the Interpretation Act, the Board has said that a “person” in section 96 does not include a trade union: DeVilbiss (Canada) Limited, [1976] OLRB Rep. Mar. 49 at pg. 60, para. 12:

12. This complaint is one of the first that has been filed by a trade union under the recently amended section 79 alleging a violation of section 14. Prior to the amendment it had been held that a trade union could not file a section 79 complaint on its own behalf, in contrast to a complaint filed on behalf of an individual grievor, in that section 79 referred to complaints alleging “a person” had been dealt with contrary to the Act. (See Rapid Type Settling Co. Ltd. [1972] OLRB Rep. July 138.) A trade union is not a legal entity in the province of Ontario. (See Nipissing Hotel Ltd. v. Hotel and Restaurant Employees and Bartenders International Union (1963) 1963 CanLII 149 (ON HCJ), 38 D.L.R. (2d) 675 (Ont. H.C.).) And thus to the extent that the term “person” refers to a legal entity its meaning does not embrace a trade union. Secondly, The Interpretation Act, R.S.O. 1970, c. 225, s. 30(28) defines “person” as including “a corporation…” and makes no reference to a trade union. And finally, sections similar to section 61 of The Labour Relations Act, wherein references to both persons and trade union are found, evidence a legislative intent that the term “person” does not embrace a trade union.

However, section 79 was recently amended to read, in part:

79-(1) The Board may authorize a labour relations officer to inquire into any complaint alleging a contravention of this Act.

[emphasis added]

Clearly the section is not now limited to complaints that pertain only to persons but rather the section makes reference to “any complaint alleging a contravention of this Act”. …

Earlier common-law had held the reverse: Society Brand Clothes Limited v. ACWA 1930 CanLII 64 (SCC), [1931] S.C.R. 321. In Jarvis v. Associated Medical Services (1964) 1964 CanLII 12 (SCC), 44 D.L.R. (2d) 407, the Supreme Court of Canada held that a “person” as defined in (now) section 72 did not include a person employed in a managerial capacity. It would be absurd to suggest that a “person” in section 69(2) could include a corporation but not a sole proprietorship.

24. Some useful obiter is found in Harwill Originals, [1982] OLRB Rep. June 875:

25. At the commencement of the hearing, counsel for the applicant contended that since section 1(4) does not make any reference to an application being made under the section by an employer, it follows that the section cannot be invoked by the respondents. The Board orally rejected this contention. Section 1(4) states that an application can be made under the section by “any person, trade union or council of trade unions concerned”. If the legislature had desired to limit applications under the section only to trade unions and councils of trade unions, it would not have also made provision for an application to be made by “any person”. By virtue of the Interpretation Act, a “person” can include a “corporation” or other similar legal entity which can act in the capacity of an employer. Accordingly, we are satisfied that the respondents, being corporations and thus, at law, “persons” are entitled to bring an application under section 1(4).

[emphasis added]

It is true that the italicized portion of the above phrase is obiter, and does not in fact flow from the reasoning which precedes it. However, it does point to the proper purposive analysis. If the entity which was the subject of an application for certification in Harwill Originals was capable of being an employer, and assuming that an employer can bring an application under subsection 1(4), there is no reason why the Board would distinguish between a corporation and any other form of employer.

25. As the Union conceded, a division of a corporation may well be an employer for the purposes of the Labour Relations Act, 1995. The Board has not, at least in the past fifteen years, certified a division of an employer where the issue was contested before the Board. However, that is the exercise of the Board’s jurisdiction under section 9 with respect to an appropriate bargaining unit (which includes a definition of the employer). The Board has regularly issued certificates to a division of a corporation where the parties have agreed on that bargaining unit description. There is no dispute that a division of a corporation may sign a collective agreement as an employer. It will be a valid responding party to an application under section 133, various unfair labour practice complaints, including bad faith bargaining and unlawful lock-outs, and is the employer for the purposes of the appointment of a conciliation officer, and virtually any other proceeding under the Act. The Board has dealt with the bargaining rights of a division in considering questions under subsection 1(4) (Metroland, Printing, Publishing & Distributing, [1991] OLRB Rep. Sept. 1069 and section 69 (General Bakeries Limited (Mammy’s Wonderbread Division), [1979] OLRB Rep. Mar. 400).

26. What then, would be the purpose of interpreting “person” in section 69(2) or (3) to exclude an entity which can be an employer for all other purposes of the Act? The choice of the word “person” in section 69 appears to have been motivated by a desire for verbal clarity as much as anything else. The vendor or transferor in such a transaction is identified as an “employer”, a word which is capable of referring to a division of a corporation. The word “person” is used to describe the purchaser. This is certainly a different word and one which makes the meaning of the sentence clearer. However, neither “employer” nor “person” has a precise or fixed meaning generally, and it is difficult to determine that the two words are used in section 69 with the intent to distinguish between two types of entities.

27. The issue then, in this sale of business application is a narrow one. Most of the essential legal elements are not in dispute. Both parties agree that there were predecessor corporations (Foundation and Nicholls-Radtke) and that there is only one corporation now (BFC-CGI). Both agree that there is a new legal form in which the businesses of the predecessor corporations are carried on. Both agree that the collective agreement binding on the predecessors are binding on the businesses in their new legal form. Where they disagree is over the question of what that new legal form is. The applicant asserts that the new legal form is the corporation, so that the effect of the sale is that the collective agreements are binding on the whole of BFC-CGI. The responding parties say that the “successor” is a division of BFC-CGI, so that the effect of the sale is that only the divisions are bound to the collective agreements.

28. Depending on the facts, either result might achieve the aims of the statute. One of the purposes of section 69 has been described as follows in Aircraft Metal Specialists Ltd., [1970] OLRB Rep. Sept. 702 at pg. 704:

The purpose of section [69] becomes important in assessing the various fact situations that arise. Section [69] operates on a number of levels. The first level of course is to prevent the subversion of bargaining rights by transactions which are designed to get rid of the union. We have encountered situations where there are transactions between various corporate entities which are in effect “paper transactions”, and are a form of corporate charade engaged in for the purpose of eliminating the trade union. In this type of case the Board has liberally interpreted section [69] to preserve the bargaining rights and has attempted to look beyond “paper transactions” to achieve that purpose.

A further and important purpose of section [69] is to preserve the bargaining rights with respect to work which has accrued to the benefit of the employees as a result of their union becoming the bargaining agent through certification or voluntary recognition. Once the union has been recognized with respect to a particular business the union then obtains a right to bargain with respect to wages, hours and other conditions of employment in that business. The right to participate in the business and its functions in that manner is in the nature of a vested right and section [69] allows the union to pursue that bargaining right when all or part of the business is sold. In making determinations under section [69] therefore, the Board is interested in maintaining the bargaining rights where the sale involves a continuum of the business.

The responding parties argue in essence that this result can be achieved by finding that the “business” which has been sold is the business of Nicholls-Radtke and Foundation and that it has been sold to the BFC-I Division and perhaps other divisions. This would, in its view, result in the preservation rather than the expansion of bargaining rights.

29. While this “preservation versus expansion” analysis is more typical of the Board’s decisions under section 1(4) than those under section 69, those same issues inform both types of decisions. There is a difference, however. Under section 1(4) the Board has a discretion about the nature and extent of the remedy it issues. Under section 69 this is not true. It is therefore a somewhat more restricted inquiry. Once the Board finds that the business of Foundation or Nicholls-Radtke has been transferred beyond the BFC-I Division (itself a difficult analytic exercise), then the “person to whom the business was sold” is those other divisions of the company or, more likely, the entire corporation.

30. It is, however, possible that the effect of the sale might be as limited as the responding parties allege in a practical sense. In that case the purposes of section 69 might be fulfilled if the Board is able to determine that the business of Nicholls-Radtke and Foundation has been transferred to a single division or a number of discrete divisions within BFC-CGI.

31. Although it is not articulated that way, that is the end result in the Pitts & Engineering Construction case, supra. Useful reference might also be made to Eaton-Yale Ltd., [1971] OLRB Rep. Oct. 667. That case dealt with parties engaged in manufacturing. One of the two predecessors had a collective agreement with an “all-employee” scope and no geographic limitation. Notwithstanding this apparent province-wide scope, the Board found that the bargaining rights in reality covered only employees at two of the four plants of the predecessor. Although the case appears to have been decided under the version of section 69 which existed before the 1970 amendment, the result is that the purchaser was the division of the amalgamated corporation. That is, in determining the like bargaining unit (the only thing the Board could do under the pre-1970 statute) the Board determined that the division, which it found to be limited to two plants, was the party to which the business had been transferred. Reference may also be made to New Dominion Stores, supra, at paragraph 19.

32. In this case, then, the Board finds that the act of corporate amalgamation was indeed a sale of business. What remains to be determined on a factual basis is the identity of “the person to whom the business [was] sold”. That is, is that “person” BFC-I or other divisions, or is it the entirety of BFC-CGI. The Board finds that a “person” in section 69(2) may be a division of a corporation.

33. This controversy arises primarily because the parties are engaged in the construction industry. It is unlikely to arise in industrial, service, or white-collar bargaining units because of the more limited geographic scope of bargaining rights outside the construction industry.

34. There are, in the Board’s view, very few factual cases even in the construction industry in which this argument could be made. If no further evidence were called, the Board would be forced to conclude that the purchaser is BFC-CGI, the corporation. On paper, it is the only identifiable “person”. While the applicant bears the ultimate onus in this case, by proving the fact of amalgamation, the union has shifted the balance of persuasion to the responding party to establish that there is an identifiable division which is distinct and discrete from the rest of the newly amalgamated corporation and which has not been sold or transferred, in any part, to any other division of this amalgamated corporation.

35. Certain facts about this case are unique. Several of these businesses commenced operations in 1913, 1924, and the early 1960’s. A current conglomeration of divisions was assembled out of disparate companies, originally owned by different and unrelated parties. As counsel for the responding parties pointed out, the amalgamation occurred after this application was originally filed. This could hardly be described as an attempt to defeat the Union’s bargaining rights. While the Union alleged in the application and continues to allege that the divisions carry on associated or related businesses or activities under common control and direction, the responding parties assert that these divisions are quite independent of one another and have a lengthy history of independence which they have maintained even after the amalgamation. Which of these versions is true remains to be seen.

36. The parties are directed to contact the Registrar with respect to the scheduling of further dates. The parties did not discuss with the Board the number of days needed, or any particular issues with respect to scheduling. If the parties can agree on a number of dates, they should simply advise the Registrar that and arrange scheduling with him. If a pre-hearing conference is required, this can be scheduled or arranged by telephone conference.

37. I am seized of this application.

“David A. McKee”

for the Board