Court of Appeal for Ontario

Date: 2017-06-29 Docket: C62931

Judges: LaForme, Hourigan and Paciocco JJ.A.

Between

Total Mechanical Systems Limited, Total Mechanical Systems Ltd., Riccardo Lettieri Plaintiffs (Appellant)

and

Sheet Metal Workers' International Association, Local 30, Lea West Defendants (Respondents)

Counsel

Allan Rouben, for the appellant, Riccardo Lettieri

Julian Heller, for the respondents

Heard: June 28, 2017

On appeal from the order of Justice Andra Pollak of the Superior Court of Justice, dated October 19, 2016.

Reasons for Decision

Introduction

[1] Riccardo Lettieri appeals the order of the Superior Court of Justice striking out his Fresh as Amended Statement of Claim: Total Mechanical Systems v. Sheet Metal Workers' International Association Local 30, 2016 ONSC 4732. We think a review of the relevant facts will provide a clear guide to the appropriate resolution of this appeal.

Background Facts

[2] In July 2008, the appellant, Lettieri entered into a Voluntary Recognition Agreement (the VRA) on behalf of his wholly owned company, Total Mechanical Systems Limited, with the respondent Union. Since then, he has attempted to contest the validity of that agreement.

[3] First, in response to a grievance by the Union before the Ontario Labour Relations Board (the OLRB) in October 2011, in part because he was not of sound mind due to a health condition when he signed it on behalf of Total Mechanical Systems Limited. In April 2013 the Divisional Court denied a judicial review application of the Board's decision.

[4] Second, and while the OLRB proceedings were going on, Lettieri et al. launched an action in the Superior Court for damages in July 2011. Despite prior agreements to the contrary, Lettieri et al. noted the Union in default on February 28, 2012, which on consent was set aside on May 25, 2012. On January 14, 2013 the Union is again noted in default. In December 2015 the corporate plaintiffs discontinued against the Union leaving only Lettieri. Finally, on January 21, 2016, Lettieri issues a Fresh as Amended Statement of Claim.

[5] By order dated December 7, 2016, the Union was successful in obtaining an order that: (i) the default of January 13, 2013 was set aside; and (ii) the Fresh as Amended Statement of Claim dated January 21, 2016 was dismissed under r. 21.01 as disclosing no reasonable cause of action.

Conclusion of the Motion Judge

[6] It is with this factual background, which is largely uncontested and abundantly clear from the record and in the relevant pleadings that the motion judge carried out her analysis. She concluded at para. 19 that, notwithstanding that Lettieri was seeking personal damages, the "essential character of the issues in this matter are based on a determination of the very validity of the Voluntary Recognition Agreement signed by Mr. Lettieri on behalf of his corporations." At para. 20 of her reasons, the motion judge concluded:

… The OLRB has exclusive jurisdiction to deal with the issues that form the basis of Mr. Lettieri's claim in this action. The fact that Mr. Lettieri could not claim personal relief does not give this Court jurisdiction to relitigate the validity of the Voluntary Recognition Agreement, which includes the alleged misrepresentations of the Defendants. The OLRB has exclusive jurisdiction over this issue and has made a judicial determination finding the Voluntary Recognition Agreement to be valid. The doctrine of abuse of process is designed to stop this type of Claim made by Mr. Lettieri and it is, in my view, applicable in this case to grant the relief requested by the Defendants. I therefore find that the Plaintiffs Fresh as Amended Statement of Claim discloses no cause of action and is therefore struck out.

[7] As we noted, Lettieri appeals the motion judge's order only in connection with the dismissal of his action. The essence of his complaint is that he was not personally a party to the collective agreement, and therefore he can attack the validity of it in a Superior Court action notwithstanding the OLRB's determinations. For that reason, he also says the doctrines of res judicata and abuse of process do not apply.

Analysis

[8] The appeal is dismissed. We agree with the motion judge's conclusion set out above and for the additional reasons set out below.

[9] First, the motion judge correctly notes that all of Lettieri's claims in the Fresh as Amended Statement of Claim are dependent on his assertion that "he was not a party to the [VRA] because he had no capacity to execute the agreement and the union representatives were aware of that": Reasons, at para. 5. The record thoroughly illustrates the correctness of this as we reveal further below.

[10] On September 15, 2011 the OLRB granted an adjournment to the corporate parties on the basis that the "only issue to be determined was whether or not the state of Lettieri's health would be sufficient to cause the [VRA] to be set aside". In its October 2011 decision, the OLRB concluded the VRA applied and there was no basis upon which the VRA should not be enforced as valid. This included Lettieri's assertion that he was unwell at the time of signing the agreement, and did not understand the nature and effect of what he was signing.

[11] Significantly, all the alleged misrepresentations relied on by the Lettieri in the Fresh as Amended Statement of Claim were included in the response to the OLRB proceedings. These grounds were abandoned as part of those proceedings and so, the only issue relied upon in opposing the grievance was Lettieri's health issue.

[12] In its April 10, 2013 decision, the Divisional Court dismissed the application of Lettieri et al for judicial review: Total Mechanical Systems v. Sheet Metal Workers' International Association Local 30, 2013 ONSC 1922. In doing so it found, at para. 20:

… the evidence before the Board was that at the time that Mr. Lettieri signed the agreement, his brother was unaware of his incapacity, if his own brother was unaware of the problem, it stands to reason that the union was not in a position to have either actual or constructive knowledge of Mr. Lettieri's incapacity.

[13] Thus, the enforceability of the VRA and the effect of Lettieri's health on its validity and enforceability have already been adjudicated upon. Indeed, Lettieri's health issue has been front and centre in connection with the validity of the VRA since the earliest stages of these proceedings. Not surprisingly, the motion judge concluded the OLRB properly had jurisdiction over this matter because the "essential character" of the claim arises from the VRA. The VRA is a collective agreement and its "interpretation, application, administration or violation is to be determined by an arbitrator": Reasons, at para. 17. She is correct in reaching this conclusion: see Bhaduria v. Toronto Board of Education, [1999] 173 D.L.R. (4th) 382 (Ont, C.A.).

[14] Second, just as the motion judge held, we agree that the Fresh as Amended Statement of Claim amounts to an abuse of process. It very clearly reads as simply another attempt to re-litigate decisions of the OLRB and the Divisional Court in another forum. While not all re-litigation is necessarily abusive, permitting a collateral challenge in a court action on an issue within the exclusive jurisdiction of the OLRB relating to the validity of a collective agreement is damaging to the integrity of the administration of justice. This claim is "vexatious and violate[s] the fundamental principles of justice underlying the community's sense of fair play and decency": Toronto v. C.U.P.E., Local 79, 2003 SCC 63 at para. 35.

Disposition

[15] For the reasons given, the appeal must be dismissed. The respondent is awarded costs of the appeal in the amount of $14,000 inclusive of disbursements and HST.

"H.S. LaForme J.A."

"C.W. Hourigan J.A."

"David M. Paciocco J.A."