ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 224/15
DATE: 20151014
CORRIGENDA: 20151112
BETWEEN:
Chief Murray Rodd and Deputy Chief Tim Farquharson
Applicants
– and –
Peterborough Police Services Board
Respondent
Alexander J. Sinclair and Patrick Simon, for the Applicants
Craig R. Lawrence, for the Respondent
HEARD: 25 September 2015
REVISED Reasons for Judgment
The text of the original endorsement has been corrected with the test of the corrigendum (released today’s date)
J.C. Corkery J.
[1] The applicants are employed by the respondent as the Chief and Deputy Chief of the Peterborough Police Service and were previously employed by the Peterborough Lakefield Community Police Service before its dissolution.
[2] Two arbitration awards have been issued in favour of the applicants. This is an application brought under section 50 of the Arbitration Act, 1991, SO 1991, C. 17 (the “Arbitration Act “) to enforce the awards.
A. The Facts
[3] In December 2012, the Peterborough City Council passed and ratified a motion electing to terminate the agreement with the Township of Smith-Ennismore-Lakefield that created the Peterborough Lakefield Community Police Service. On December 20, 2012, the City of Peterborough gave notice to the Peterborough Lakefield Police Services Board that the agreement would be terminated effective January 1, 2015.
[4] In April and August of 2014, the applicants entered into separate employment contracts with the Peterborough Lakefield Police Services Board (the “Predecessor Employment Contracts”). Section 10 of these contracts addresses the obligations and entitlements of the parties upon the dissolution of the Peterborough Lakefield Community Police Service. The provisions contained in section 10 are materially the same in both contracts and similar provisions had appeared in previous versions of the applicants’ employment contracts.
[5] In December 2014, the applicants entered into new employment contracts (the “new contracts”) with the respondent. Under section 10A of the new contracts, the respondent agreed to adopt any liability owing to the applicants under section 10 of the Predecessor Employment Contracts.
[6] The parties further agreed in section 10A of the new contracts to settle any dispute involving the applicants’ entitlements under section 10 of the Predecessor Employment Contracts and the Respondent’s assumption of such liability by arbitration. The relevant part reads (as it appears in Chief Rodd’s contract which is materially the same as Deputy Chief Farquharson’s):
Any dispute or differences between the parties involving the interpretation, application, administration or alleged violation of the Chief’s entitlements under section 10 of the Predecessor Employment Contracts and the Board’s assumption of such liability under this contract, shall be settled by mediation/arbitration.
If the dispute arises, the proceeding shall be held in accordance with Part VIII of the Police Services Act, as amended from time to time, except as modified by the terms of this contract.
[7] On January 1, 2015, the Peterborough Lakefield Community Police Service was dissolved. The applicants had sought to recover their entitlements under section 10 of the Predecessor Employment Contracts from the Peterborough Lakefield Police Services Board before the dissolution, but were unsuccessful. They continued to pursue their entitlements under section 10 of the Predecessor Employment Contracts from the new Peterborough Police Services Board, the respondent, under section 10A of the new contracts, but were unsuccessful.
[8] Pursuant to section 10A of the new contracts the parties submitted the dispute to arbitration.
[9] On June 22, 2015, the arbitrator delivered an award, ordering the respondent to pay the applicants the entitlements contemplated in Section 10 of the Predecessor Employment Contracts.
[10] On July 17, 2015, the arbitrator delivered a supplementary award, ordering the Respondent to pay within 30 days the applicant Chief Rodd $248,920.86 (less any statutory deductions) and to pay the applicant Deputy Chief Farquharson $210,329.46 (less any statutory deductions).
[11] Above the style of cause in both awards appear the words “IN THE MATTER OF AN ARBITRATION PURSUANT TO A CONTRACTUAL AGREEMENT TO ARBITRATE AND THE POLICE SERVICES ACT R.S.O. 1990 AS AMENDED”.
[12] On September 21, 2015, the respondent issued and served a Notice of Application to Divisional Court for judicial review of the awards.
[13] The applicants have not been paid and they now seek to enforce the award by judgment of this court.
B. The Issues
[14] There are two issues:
Does the Arbitration Act apply to the arbitration and awards in this case?
If the Arbitration Act applies, what is the test for enforcement of an award under section 50 and has it been met in this case?
C. The Positions of the Parties
[15] The applicants argue that notwithstanding the reference to the Police Services Act in section 10A of the new contracts, because the parties agreed to submit disputes to arbitration, the new contracts are “arbitration agreements” and the Arbitration Act applies.
[16] With respect to the second issue, the applicants argue that under section 50(3) of the Arbitration Act, the court is obliged to grant judgment enforcing the arbitral award unless certain conditions exist. As none of those conditions exist, this court must grant judgment.
[17] The respondent submits that by agreeing that the proceedings for resolving disputes be held in accordance with Part VIII of the Police Services Act, the parties are not bound by the Arbitration Act as Part VIII of the Police Services Act specifically excludes the application of the Arbitration Act. Even if the Arbitration Act did apply, the respondent argues that this court should order a stay of proceeding under section 50(5)(b) of the Arbitration Act as there is a pending application for judicial review.
D. The Law
[18] The relevant parts of the Arbitration Act read as follows:
Definitions
- In this Act,
“arbitration agreement” means an agreement by which two or more persons agree to submit to arbitration a dispute that has arisen or may arise between them;
Application of Act
Arbitrations conducted under agreements
- (1) This Act applies to an arbitration conducted under an arbitration agreement unless,
(a) the application of this Act is excluded by law; or
(b) the International Commercial Arbitration Act applies to the arbitration.
Enforcement of award
Application
- (1) A person who is entitled to enforcement of an award made in Ontario or elsewhere in Canada may make an application to the court to that effect.
Formalities
(2) The application shall be made on notice to the person against whom enforcement is sought, in accordance with the rules of court, and shall be supported by the original award or a certified copy.
Duty of court, award made in Ontario
(3) The court shall give a judgment enforcing an award made in Ontario unless,
(a) the thirty-day period for commencing an appeal or an application to set the award aside has not yet elapsed;
(b) there is a pending appeal, application to set the award aside or application for a declaration of invalidity;
(c) the award has been set aside or the arbitration is the subject of a declaration of invalidity; or
(d) the award is a family arbitration award.
Pending proceeding
(5) If the period for commencing an appeal, application to set the award aside or application for a declaration of invalidity has not yet elapsed, or if such a proceeding is pending, the court may,
(a) enforce the award; or
(b) order, on such conditions as are just, that enforcement of the award is stayed until the period has elapsed without such a proceeding being commenced, or until the pending proceeding is finally disposed of.
[19] The relevant parts of the Police Services Act, R.S.O. 1990, c P.15 read as follows:
PART III MUNICIPAL POLICE SERVICES BOARDS
Responsibilities of boards
- (1) A board is responsible for the provision of adequate and effective police services in the municipality and shall,
(d) recruit and appoint the chief of police and any deputy chief of police, and annually determine their remuneration and working conditions, taking their submissions into account;
PART VIII LABOUR RELATIONS
Exclusions
Chief of police and deputy
- …
(2) The working conditions and remuneration of the chief of police and deputy chief of police of a police force shall be determined under clause 31 (1) (d) (responsibilities of board) and not under this Part.
Non-application of Arbitration Act, 1991
- The Arbitration Act, 1991 does not apply to arbitrations conducted under this Part.
E. Analysis
1. Does the Arbitration Act apply to the arbitration and awards in this case?
[20] Under section 10A of the new contracts the parties agreed disputes would be settled by “mediation/arbitration.” Such an agreement is defined under section 1 of the Arbitration Act, as an “arbitration agreement”. Unless excluded by law, the Arbitration Act applies to the arbitration conducted under the agreements (section 2(a)).
[21] Part VIII of the Police Services Act deals with Labour Relations and bargaining, conciliation and arbitration, in particular. The Arbitration Act is excluded by law from applying to arbitrations under Part VIII of the Police Services Act (section 127). However, determination of working conditions and remuneration of the chief of police and deputy chief do not fall under Part VIII of the Police Services Act (section 115(2)). Hence, arbitrations of working conditions and remuneration of the chief of police and deputy chief are not excluded by law from the Arbitration Act.
[22] In my view, the issues that the parties agreed to resolve by arbitration in the new contracts, being “the interpretation, application, administration or alleged violation of the Chief’s entitlements under section 10 of the Predecessor Employment Contracts and the Board’s assumption of such liability under this contract”, involve the determination of “working conditions and remuneration of the chief of police and deputy chief of police” excluded under section 115(2) of the Police Services Act.
[23] The Police Services Board is a creature of statute. It cannot by agreement do that which it is not authorized or is otherwise permissible to do by law. The Police Services Act makes it clear that the “working conditions and remuneration of the chief of police and deputy chief of police” are to be addressed under clause 31(1)(d) of the Act and not under Part VIII. The Arbitration Act is not excluded by law and applies to the arbitration and awards in this case.
[24] The words that appear above the style of cause in the arbitrator’s award have no bearing on the application of the Arbitrations Act. Mere reference to the Police Services Act in those words does not bring the awards under the exclusion in section 127 of Part VIII of the Act. The reference to the Police Services Act in the words above the style of cause is merely descriptive of the matter being arbitrated. The arbitration considered the Police Services Act, but not Part VIII.
2. If the Arbitration Act, 1991 applies, what is the test for enforcement of an award under section 50 and has it been met in this case?
[25] Section 50(3) of the Arbitration Act states that this court shall give judgment to enforcing an award made in Ontario unless certain conditions exist:
(3) The court shall give a judgment enforcing an award made in Ontario unless,
(a) the thirty-day period for commencing an appeal or an application to set the award aside has not yet elapsed;
(b) there is a pending appeal, application to set the award aside or application for a declaration of invalidity;
(c) the award has been set aside or the arbitration is the subject of a declaration of invalidity; or
(d) the award is a family arbitration award.
[26] None of these conditions exist here. The appeal and applications to set an award aside or have it declared invalid referred to in section 50 are the remedies referred to in section’s 45 to 49 of the Arbitration Act. An application for judicial review is not one of those remedies. The discretion to stay an award under section 50(5) of the Arbitration Act is not available in these circumstances.
F. Conclusion
[27] Judgment is granted in favour of the applicants enforcing their awards.
[28] If the parties are unable to agree on costs, I shall receive brief written submissions within seven days from applicants and fourteen days from the respondent.
J.C. Corkery J.
Date: 12 November 2015
CORRIGENDA
1. The counsel who appeared at the hearing of the application September 25, 2015 were:
Alexander J. Sinclair and Patrick Simon, for the Applicants (Chief Murray Rodd and Deputy Chief Tim Farquharson); and
Craig R. Lawrence, for the Respondent (the Peterborough Police Services Board).
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Chief Murray Rodd and Deputy Chief Tim Farquharson
Applicants
– and –
Peterborough Police Services Board
Respondent
REASONS FOR JUDGMENT
J.C. Corkery J.
Released: 12 November 2015