Ivanhoe contracted out its janitorial services to Moderne, and the union's certification and collective agreement were transferred to Moderne.
When the contract expired, Ivanhoe engaged four new contractors, and Moderne dismissed its employees.
The union applied to transfer the certification to the new contractors, while Ivanhoe applied to cancel the certification.
The labour commissioner and Labour Court transferred the certification but not the collective agreement to the new contractors, and dismissed Ivanhoe's petition for cancellation.
The Supreme Court of Canada held that the standard of review is patent unreasonableness.
The Court found that the Labour Court's application of the organic definition of an undertaking and the theory of retrocession to find a legal relationship between successive employers was not patently unreasonable.
The refusal to transfer the collective agreement and the dismissal of the cancellation petition were also upheld.
