Brown et al. v. Hanley et al.

[Indexed as: Brown v. Hanley]

Ontario Reports Ontario Superior Court of Justice Perell J. February 19, 2021

155 O.R. (3d) 33 | 2021 ONSC 1324

Case Summary

Civil procedure — Parties — Joinder — Trade unions — Members of local union commencing action against international union by suing its president as representative — Local union joined as defendant by consent but without representative manner of joinder — Plaintiffs moving to amend style of cause to except themselves as members of defendant class by virtue of their union membership — Motion granted — Litigants could not be both plaintiff and defendant in same action — Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 10.01, (1), 10.03, 12.01, 12.07, 12.08.

The plaintiffs were four members of the Amalgamated Transit Union Local 113. They sued their international union, the Amalgamated Transit Union (International), an unincorporated association. A representative manner of joinder of parties was required, so the plaintiffs joined the international union as a party defendant by suing its president. After the action was commenced, the local intervened and was joined as a defendant by consent. The joinder was an irregularity because the local was also an unincorporated association but no representative manner of joinder was used. The action sought certain declaratory relief. The defendants did not deliver a statement of defence but instead sought an order for a stay or dismissal of the action. A temporary stay was granted on terms permitting the plaintiffs to invoke the amendment process of the international union's Constitution and General Laws without reprisal from the defendants. Following the exhaustion of the amendment process, the stay could be lifted upon application of either party. The international union president named in the statement of claim died and was replaced. Two of the plaintiffs were no longer employees of a bargaining unit represented by either the local or the international union. After the amendment process was exhausted, the plaintiffs moved for an order lifting the stay, amending the style of cause, and granting leave to file a fresh as amended statement of claim.

Held, the motion should be granted.

The only disputed matter was the style of cause as the defendants did not oppose the lifting of the stay or the delivery of the fresh as amended statement of claim. The plaintiffs' proposal was to identify the defendants as the presidents of the two unions, each on his own behalf and on behalf all members of their respective unions, other than the plaintiffs. The plaintiffs, being members of both unions, did not want notionally to be members of the defendant class. The defendants submitted that no harm could come from the fact of the presidents representing all members of their respective unions. However, it was axiomatic that a litigant could not be both a plaintiff and a defendant in the same action. The plaintiffs' proposed style of cause was the correct one and they were granted leave to file a fresh as amended statement of claim accordingly, with an order nunc pro tunc appointing the union presidents as representative defendants.

Berry Estate v. Guaranty Trust Co. of Canada, [1980] 2 S.C.R. 931, consd [page34]

Other cases referred to

Brown v. Hanley, 2018 ONSC 1112; Brown v. Hanley, 2019 ONCA 395; Journey's End Toronto Hotel Number One Partnership v. Deloitte & Touche L.L.P., 2006 ONSC 3479; Lovric v. Federation Insurance Co. of Canada (1989), 71 O.R. (2d) 403; Unical Properties v. 784688 Ontario Ltd. (1990), 75 O.R. (2d) 284

Statutes referred to

Class Proceedings Act, 1992, S.O. 1992, c. 6 Labour Relations Act, 1995, S.O. 1995, c. 1, Sch. A Rights of Labour Act, R.S.O. 1990, c. R.33, s. 3(2)

Rules and regulations referred to

Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 5.03(5), 8.01, 10.01, (1), 10.03, 12.01, 12.07, 12.08 Rules of Practice, R.R.O. 1980, Reg. 540 [rep.]

MOTION by plaintiffs to amend style of cause.

Counsel: Sean Dewart, for plaintiffs. John McLuckie, for defendant Amalgamated Transit Union (International). Brian Shell, for defendant Amalgamated Transit Union, Local 113.

Endorsement

PERELL J. : —

[1] This motion raises a significant but esoteric practice point with respect to the joinder of labour unions as party defendants. It would seem that this practice point has not previously been addressed in the case law.

[2] The background to this motion begins in April 2017, when the plaintiffs Tracey Brown, Angela Clark, Dennis Boland, and Cornelius Keigher, four rank and file members of the Amalgamated Transit Union Local 113 ("ATU Local 13"), sued their international union, the Amalgamated Transit Union (International) ("ATU International").

[3] Because ATU International is an unincorporated association, a representative manner of joinder of parties was required, and so the plaintiffs joined ATU International as a party defendant by suing Lawrence J. Hanley, who was the president of the ATU International. Mr. Hanley was joined "on his own behalf and on behalf of all members of the ATU International".

[4] After the plaintiffs' action was commenced, ATU Local 113 intervened, and on consent, it was joined as a party defendant. [page35] That joinder, however, was an irregularity because ATU Local 113, which represents approximately 12,000 employees providing transportation services in the Greater Metropolitan Toronto, is also an unincorporated association; however, no representative manner of joinder was used.

[5] In their action, the plaintiffs sought a declaration that certain sections of the ATU International's Constitution and General Laws are void and of no force and effect insofar as the plaintiffs and other members of ATU Local 113 are concerned. The defendants responded to the action and instead of delivering a Statement of Defence, the defendants sought an order dismissing or staying the plaintiffs' action. That motion was successful, and I granted a temporary stay on terms. The stay order was subsequently affirmed on appeal.

[6] The terms of the temporary stay were that: (a) the plaintiffs may invoke the amendment process of the International Union's Constitution and General Laws to request amendments to sections 12, 13.4, 13.5, 13.7, 17, 21.7, 22.1, 22.2, and 27 of the Constitution; (b) the defendants are enjoined from imposing any form of discipline, union charges, or reprisal in response to the plaintiffs' request to amend the Constitution and General Laws; (c) following the exhaustion of the amendment process, the stay may be lifted upon application of either party; and (d) if the plaintiffs do not request amendments to the International Union's Constitution and General Laws, then their action shall be permanently stayed or dismissed.

[7] As it may be noted, it was a term of the interim stay order that following the exhaustion of the labour union's constitution amendment process, the stay may be lifted upon application of either party. The constitution amendment process has now been exhausted, and what is now before the court is a motion by the plaintiffs for an order: (a) lifting the stay; (b) amending the title of the proceedings; and (c) granting the plaintiffs leave to file a Fresh as Amended Statement of Claim.

[8] The defendants do not oppose the lifting of the stay, and they do not oppose the delivery of a Fresh as Amended Statement of Claim. The only disputed matter is the form of the style of cause to appear on the amended pleading. It is the form of the style of cause that raises the important practice point about the joinder of labour unions in court proceedings. [page36]

[9] Before the matter of how labour unions should be joined as party defendants to actions, the following factual matters need to be noted:

(a) The plaintiffs Dennis Boland and Cornelius Keigher are no longer employees of a bargaining unit represented by either ATU Local 113 or ATU International, and it is proposed that they be removed as plaintiffs. (b) Mr. Hanley died in May 2019, and John A. Costa has been elected President of ATU International. (c) Carlos Santos is the current president of ATU Local 113.

[10] With this factual background, the dispute in the immediate case, and the matter of the proper joinder of ATU International and ATU Local 113 can now be addressed. The difference between the parties over the style of cause is actually quite narrow. Set out below are the competing versions with the difference highlighted in bold underlined type.

[11] Thus, the dispute between the parties is that:

(a) although the plaintiffs are members of the ATU International, they do not want notionally to be members of the [page37] defendant class being represented by Mr. Costa, who defends on behalf of all members of the ATU International; and (b) although the plaintiffs are members of ATU Local 113, they do not want notionally to be members of the defendant class being represented by Mr. Santos, who defends on behalf of all members of ATU Local 113.

[12] The parties have not found any cases where this problem of the plaintiff members of the labour union being notionally represented by the representative defendant for the labour union being sued has been addressed or even noticed.

[13] The defendants in the immediate case submit that the conventional practice should continue and that no harm can come from the truth, which is that Mr. Costa and Mr. Santos do represent "all members" of their respective labour unions.

[14] To resolve the dispute between the parties, as a matter of legal background, it must be noted that s. 3(2) of the Rights of Labour Act provides that a trade union shall not be made a party to any action in any court unless it may be made a party irrespective of the Rights of Labour Act or of the Labour Relations Act, 1995.

[15] Because of the Rights of Labour Act and because labour unions are unincorporated associations, it has long been the practice under the former Rules of Practice or under the current Rules of Civil Procedure that a labour union must be sued by some form of representation order. A representation order was not formally obtained in the case at bar.

[16] Under the former Rules of Practice representative orders were made pursuant to Rule 75, which stated:

75. Where there are numerous persons having the same interest, one or more may sue or be sued by the court to defend on behalf of, or for the benefit of all.

[17] In contemporary times, representative actions involving representative plaintiffs or representative defendants are governed by the Class Proceedings Act, 1992 or by the Rules of Civil Procedure. The relevant Rules of Civil Procedure are rules 10.01, 10.03, 12.01, 12.07 and 12.08 which state: [page38]

RULE 10 REPRESENTATION ORDER

Proceedings in which Order may be Made

10.01(1) In a proceeding concerning,

(a) the interpretation of a deed, will, contract or other instrument, or the interpretation of a statute, order in council, regulation or municipal by-law or resolution;

[. . .]; or

(f) any other matter where it appears necessary or desirable to make an order under this subrule,

a judge may by order appoint one or more persons to represent any person or class of persons who are unborn or unascertained or who have a present, future, contingent or unascertained interest in or may be affected by the proceeding and who cannot be readily ascertained, found or served.

Order Binds Represented Persons

(2) Where an appointment is made under subrule (1), an order in the proceeding is binding on a person or class so represented, subject to rule 10.03.

Settlement Affecting Persons who are not Parties

(3) Where in a proceeding referred to in subrule (1) a settlement is proposed and some of the persons interested in the settlement are not parties to the proceeding, but,

(a) those persons are represented by a person appointed under subrule (1) who assents to the settlement; or (b) there are other persons having the same interest who are parties to the proceeding and assent to the settlement,

the judge, if satisfied that the settlement will be for the benefit of the interested persons who are not parties and that to require service on them would cause undue expense or delay, may approve the settlement on behalf of those persons.

(4) A settlement approved under subrule (3) binds the interested persons who are not parties, subject to rule 10.03.

RELIEF FROM BINDING EFFECT OF ORDER

10.03 Where a person or an estate is bound by reason of a representation order made under subrule 10.01 (1) or rule 10.02, an approval under subrule 10.01 (3) or an order that the proceeding continue made under rule 10.02, a judge may order in the same or a subsequent proceeding that the person or estate not be bound where the judge is satisfied that,

(a) the order or approval was obtained by fraud or non-disclosure of material facts; (b) the interests of the person or estate were different from those represented at the hearing; or [page39] (c) for some other sufficient reason the order or approval should be set aside.

DEFINITIONS

12.01 In rules 12.02 to 12.08,

"Act" means the Class Proceedings Act, 1992.

PROCEEDING AGAINST REPRESENTATIVE DEFENDANT

12.07 Where numerous persons have the same interest, one or more of them may defend a proceeding on behalf or for the benefit of all, or may be authorized by the court to do so.

PROCEEDING BY UNINCORPORATED ASSOCIATION OR TRADE UNION

12.08 Where numerous persons are members of an unincorporated association or trade union and a proceeding under the Act [i.e., Class Proceedings Act, 1992] would be an unduly expensive or inconvenient means for determining their claims, one or more of them may be authorized by the court to bring a proceeding on behalf of or for the benefit of all.

[18] With this factual and legal background, the legal analysis may begin. That analysis may begin by noting that while it is not clear, it may be that: (a) the plaintiffs are relying on rules 12.01, 12.07 and 12.08 of the Rules of Civil Procedure in bringing their action against the ATU International and ATU Local 113; and (b) those rules are available because it would be an unduly expensive or inconvenient means for the numerous persons who are members of ATU International and ATU Local 113 to proceed under the Class Proceedings Act, 1992 to have their legal rights with respect to the International Union's Constitution determined.

[19] This observation is informative because had the plaintiffs proceeded under the Class Proceedings Act, 1992, then the conventional practice would be to separate the parties adverse in interest so that they are not notionally both plaintiffs and defendants in the same proceeding. This observation suggests that the same practice should be followed in representative actions under rules 12.01, 12.07 and 12.08 of the Rules of Civil Procedure.

[20] Much the same can be said if the plaintiffs in the immediate case are relying on a representative order being made pursuant to rule 10.01(1). Under that rule Mr. Costa and Mr. Santos could be appointed to represent a class of persons who may be affected by the proceeding and who cannot be readily ascertained, found or served, which would appear to be the case with respect to the 12,000 members of ATU Local 113. [page40]

[21] In the immediate case, if rule 10.01(1) were relied on, it would again make good sense to exclude the plaintiffs from the class of defendant persons being represented by Messrs. Costa and Santos, once again, to avoid the circumstance that a party is not both a plaintiff and a defendant in the same action.

[22] It is axiomatic that a litigant cannot be both the plaintiff and the defendant in the same proceeding; visualize:

(a) Pursuant to rule 5.03(5), a person who is required to be joined as a party (a necessary party) and who does not consent to be joined as a plaintiff or applicant shall be made a defendant or respondent. The missing necessary co-plaintiff is not both a plaintiff and defendant. (b) In Berry Estate v. Guaranty Trust Co. of Canada, Guaranty Trust acting as a corporate executor for the estate James W. Berry sued its co-executor and also itself for the conduct of two of its former officers, whose misconduct Guaranty Trust was unaware of when letters probate were granted. Justice Maloney appointed the Public Trustee to replace the executors, and on appeal to the Court of Appeal, the Court of Appeal held that the writ of summons was not a nullity but an irregularity cured by the order appointing the Public Trustee as executor. In the Supreme Court, Justices Dickson, Estey, McIntyre and Chouinard (Justice Ritchie dissenting,) held that Guaranty Trust could not sue itself, but having done so, the result was not a nullity but an irregularity that could be rectified by the substitution of the Public Trustee. (c) Unlike a third party who, pursuant to rule 8.01 of the Rules of Civil Procedure may sue a partnership (another type of unincorporated association) in the partnership name, if a partner has a grievance against his or her partners, he cannot sue the law firm in which he or she is partner and must sue the partners individually. This rule allowing a proceeding in the name of the partnership was introduced to avoid the difficulty of suing in the name of all of possibly many partners, but the rule does not authorize individual partners [page41] to sue in the name of the partnership when they are advancing their own individual claims. One partner may not sue another partner in the name of the partnership. Once again, there is a separation between the plaintiff who is also a member of the defendant group from being a member of the defendant group and once again there is respect for the axiomatic principle that one cannot simultaneously be a plaintiff and a defendant.

[23] Following these axioms of civil procedure, I, thus, conclude that in the immediate case the plaintiffs' proposed style of cause is the correct one for the case at bar, and, if necessary, I make the representative order, nunc pro tunc.

[24] For the above reasons, I grant an order:

(a) lifting the temporary stay of proceedings; (b) nunc pro tunc appointing Messrs. Costa and Santos respectively the Representative Defendants; (c) granting the plaintiffs leave to file a Fresh as Amended Statement of Claim with a style of cause in the form proposed by the plaintiffs; (d) directing that a Statement of Defence be delivered by April 14, 2021; (e) there shall be no order as to costs.

Motion granted.