Court File and Parties

COURT FILE NO.: CV-19-00615322-0000 DATE: 2021-04-20

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

DIK LEE Plaintiff

– and –

MAGNA INTERNATIONAL INC., COSMA INTERNATIONAL INC., VENEST INDUSTRIES INC., MIKE ROOKE, GINA AIELLO, JOEL MINOR, JOEL WILLICK and STEVEN THUSUSKA Defendants

Self-represented and acting in person Laura J. Freitag, lawyer for the defendant

HEARD: April 16, 2021

ENDORSEMENT

DIAMOND J.:

Overview

[1] On January 11, 2021, Justice Myers issued a Civil Practice Court endorsement scheduling several motions in this proceeding to proceed by way of a half day hearing. Ultimately, the only motion that ended up being argued before me on that date was the plaintiff’s motion seeking leave to amend his pleading and file a Second Fresh as Amended Statement of Claim.

[2] While that motion is typically heard by a Master, given that this action remains in the pleadings stage after being issued more than two years ago, I agreed to hear the plaintiff’s motion to amend.

[3] At the conclusion of the hearing, I took my decision under reserve.

Facts Giving Rise to this Dispute

[4] As found by my colleague Justice Leiper at paragraphs 3 through 10 of her Reasons for Decision released on June 24, 2020 (described in greater detailed hereinafter), the following is a helpful summary of the facts which gave rise to this proceeding:

“Mr. Lee was employed as a production technician by Venest Industries Inc., an auto parts manufacturer and a division of Cosma International Inc. Cosma is a subsidiary of Magna International Inc. The other defendants are employees of Venest Industries.

On March 14, 2018, the defendant Steven Thususka complained of harassment by Mr. Lee after Mr. Thususka was instructed to relay a communication to Mr. Lee regarding cleanliness in the welding area in the Venest workplace. There was an internal investigation and Mr. Lee was disciplined.

On November 2, 2018, Mr. Lee brought an application to obtain disclosure of documents created during the internal investigation.

On November 5, 2018, Mr. Lee complained to the Ministry of Labour about the workplace investigation.

On November 27, 2018, the Ministry review found that ‘The investigation was not appropriate in the circumstances due to all information collected as part of the investigation does not appear to have been considered when determining the findings of the investigation.’ Mr. Lee’s ‘primary employer’ under the OHSA, Magna International Inc., was ordered to ensure that an investigation ‘be conducted into the incidents and complaints of workplace harassment that was appropriate in the circumstances pursuant to s. 32.0.7 of the Occupational Health and Safety Act.’

On January 7, 2019, Mr. Lee brought an application before the Ontario Labour Relations Board against Magna, Venest and three employees of Venest alleging unlawful reprisal under section 50 of the OHSA.

The second investigation ordered by the Ministry of Labour was completed on February 13, 2019 by Gary Love, the human resources director for Cosma Canada. Mr. Love confirmed the findings and outcome of the first investigation but also found that Mr. Lee’s behaviour toward Mr. Thususka may have been unintentional.

Mr. Lee left his employment at Venest Industries Inc. on February 28, 2019.”

Procedural History

[5] After being served with the original Statement of Claim, the defendants sought to challenge that pleading. In response (and before any motion was brought), the plaintiff served an Amended Statement of Claim on May 21, 2019. The defendants then served a Statement of Defence on June 20, 2019.

[6] On July 2, 2019, the plaintiff served both a Reply and a Fresh as Amended Statement of Claim. The defendants served a Rule 21 motion to strike out portions of the Fresh as Amended Statement of Claim, and that motion was ultimately heard by Justice Leiper on February 26, 2020 (with subsequent written submissions filed between March - June 2020).

[7] Prior to the return of the defendants’ motion to strike, the plaintiff brought a motion to amend his pleading to add Gary Love (described in the excerpts from Justice Leiper’s decision above) as an individual defendant. That motion to amend proceeded before Master Mills on October 23, 2019.

[8] In dismissing the plaintiff’s motion to amend, Master Mills held as follows:

“The plaintiff seeks to add Mr. Love to these proceedings on the basis of an alleged duty of care owed by Mr. Love to the plaintiff in the conduct of the investigation. The plaintiff relies on the decision of the Court of Appeal in Correia v. Canac Kitchens et al 2008 ONCA 506, 91 O.R. (3d) 353 which cites Anns v. Merton London Borough Council [1978] A.C. 728, [1977] 2 ALL E.R. 492 (H.L.)) to set out the test to be met as to whether a person owes a duty of care to another:

(1) Does the relationship between the parties disclose sufficient foreseeability and proximity to establish a prima facie duty of care?; and

(2) Are there any policy considerations that should negate or limit that duty of care?

In the Canac case, the company hired a professional investigator to conduct a criminal investigation of an employee. The court had to consider whether the company owed a duty of care to the employee and whether that duty extended to a professional investigator hired by the employer such that the investigator could then be said to owe a duty of care to the employee. After a lengthy analysis, the Court of Appeal found that a privately retained professional investigator in the business of conducting investigations may owe a duty of care to an employee being investigated. The court found that different considerations apply to employers conducting internal investigations of their employees. There is no duty of care owed by an employer to conduct a good faith internal investigation (at par.72-75).

The plaintiff submits that Mr. Love was an independent professional investigator once Magna engaged his services to conduct the investigation of its related company complaint. I disagree. Mr. Love was at all times employed by Cosma. He provided his services to conduct an internal review of an employee harassment complaint. This did not make him a professional investigator and it did not give rise to an independent duty of care owed to the plaintiff. It is acknowledged by the plaintiff that Mr. Love conducted the investigation at the request and with instructions from Magna. Mr. Love was not conducting a personal or separate investigation from that ordered by the Ministry of Labour. Further, the plaintiff conceded the allegations against Mr. Love do not differ in substance from those also made against Cosma or Magna. The fact that the Occupational Health and Safety Act directs employers to conduct investigations does not then establish a duty of care owed by the employer to the employee. As noted in Canac (at par. 72), this would violate the Wallace principles set out by the Supreme Court of Canada in Wallace v. United Grain Grovers Ltd. 1997 CanLII 332 (SCC), [1997] 3 S.C.R. 701.”

[9] Master Mills dismissed the plaintiff’s motion to amend on the grounds that there was no duty of care owed by the corporate defendants to the plaintiff, notwithstanding any statutory duties of care set out in the Occupational Health and Safety Act (the “Act”).

[10] When the defendants’ motion to strike was heard by Justice Leiper on February 26, 2020, the plaintiff brought a cross-motion seeking leave to amend his Fresh as Amended Statement of Claim by adding a series of unnamed defendants identified as “every director and every officer of the corporation of Magna International Inc. jointly and separately”. None of the individual directors and officers were identified in the proposed draft pleading.

[11] In her decision released on June 24, 2021, Justice Leiper did not consider the plaintiff’s cross-motion, which was in fact argued before me on April 16, 2021. However, Justice Leiper did dismiss the plaintiff’s claims in negligence against the corporate defendants, finding that there was no tort of negligent investigations as against employers in Ontario:

“Although the amendments provide some ministry oversight of workplace investigations, the OHSA does not create a statutory cause of action for damages for a breach of the workplace investigation provisions. It is well established that there is no stand-alone breach of statutory duty, finding that civil consequences for breach of a statue should be subsumed in the law of negligence. Proof of a statutory breach which causes damages, may be evidence of negligence. The statutory formulation of the duty may afford a specific, and useful, standard of reasonable conduct.: Canada v. Saskatchewan Wheat Pool 1983 CanLII 21 (SCC), [1983] 1 S.C.R. 205. at p. 443; Mohammed v. The Queen in Right of Ontario 2019 ONSC 532.

Mr. Lee argues that these new duties give rise to a claim in negligence against his employer and parent companies: the context is a workplace investigation into a complaint against him by a fellow employee after an exchange of words over workplace tidiness. Prior to the amendments to the OHSA, the courts have considered whether a person who is the subject of an investigation might have a claim in negligence.

The courts have recognized a tort of negligent investigation in the case of police forces: Hill v. Hamilton-Wentworth 2007 SCC 41, [2007] 3 S.C.R. 129. In the workplace environment, this tort was extended to private investigation firms: Correia v. Canac Kitchens 2008 ONCA 506. However, the Court of Appeal for Ontario has stopped short of extending tort liability to employers conducting internal investigations of their employees: Correia v. Canac Kitchens 2008 ONCA 506. See also Singh v. RBC Insurance, 2020 CarswellOnt 1619.

I find that either I am bound by the findings of the Court of Appeal in Correia on the question of extending a cause of action in tort against an employer for the conduct of internal workplace investigations, or if a fresh analysis of the second stage of the Anns test ought to be done as a result of the OHSA amendments, that this analysis supports the same conclusion as in Correia. I say this because the policy concerns that underly Correia continue to exist. Workplace investigations can and often do include conduct that goes beyond workplace misconduct and can extend into the sphere of criminal law. Employers should not feel constrained from reporting criminal behaviour to the police. There is a public interest in encouraging such reporting.

Further, the OHSA and the Ministry of Labour provides mechanisms by which less serious matters are subject to oversight and employers can be required to take appropriate steps in conducting internal investigations. Employees have other routes to recover from employers because of the contractual relationship enjoyed between them.

Finally, there is no legislative indication of new routes for tort liability by virtue of the OHSA amendments.

I conclude that as a result of my findings as to the application of Correia, or in the alternative a consideration of the Anns test, that it is plain and obvious that Mr. Lee’s proposed claim in negligence against his employer or the parent companies cannot succeed.”

The Second Fresh as Amended Statement of Claim

[12] As stated, the plaintiff’s draft Second Fresh as Amended Statement of Claim seeks to add a claim of negligence (on occasion described as “gross negligence”) against every unnamed officer and director of Magna. In summary, it is the plaintiff’s position that every single officer and director breached their duty of care to “take all reasonable care”, and in particular by failing to:

• Ensure that Magna chose an appropriate investigator;
• Ensure that Magna conducted an appropriate re-investigation in compliance with the Act and/or as directed by the Ministry of Labour;
• Ensure that Magna, as the plaintiff’s primary employer, kept and maintained all identifying information collected during the investigation as confidential;
• Ensure that Magna, as the plaintiff’s primary employer, implemented the policies and procedural as set out in the Act;
• Ensure that Magna, as the plaintiff’s primary employer, provided a safe and respectful work environment in compliance with the Act;
• Ensure that Magna, as the plaintiff’s primary employer, took every reasonable precaution in the circumstances for the plaintiff’s protection;
• Ensure that a thorough comprehensive investigation was conducted; and
• Ensure that Gary Love conducted an appropriate investigation.

[13] The plaintiff relies on sections 32.0.6, 32.0.7 and 32.0.8 of the Act in support of his contention that each and every officer and director of Magna owed the plaintiff a duty of care. The plaintiff alleges that every single officer and director breached their duty of care to ensure that Magna complied with the Act, its regulations, and the Ministry of Labour’s orders and requirements.

Decision

[14] To begin, a pleading cannot be issued where the identities of the proposed new defendants are not explicitly listed in the style of cause and body of the pleading. This is not a situation where a party requires an unknown defendant to be classified as “John or Jane Doe”. The fact that the plaintiff cannot identify the officers and directors of Magna is, in and of itself, a basis for dismissing the plaintiff’s motion.

[15] As set out hereinafter, a claim against an officer and director of a corporate defendant must ensure that sufficient particulars are raised to exhibit a separate identity of interest on the part of the individual from that of the corporation. On this motion, the Court does not know who the alleged individuals are, and thus it is impossible to assess whether those unnamed individuals are alleged to have exhibited a separate identity of interest.

[16] As previously found by Justice Leiper, a breach of a statutory duty does not create a cause of action. As held by the Court of Appeal for Ontario in Boulanger v. Johnson & Johnson Corp. 2003 CanLII 52154 (ONCA),”while a statutory requirement can inform a common law duty of care, there is no cause of action in tort for breach of a statute.” Accordingly, the plaintiff’s reliance upon alleged breaches of the Act on the part of the individual officers and directors of Magna is misplaced in so far as creating a cause of action against those individual officers and directors.

[17] While the proposed amendments against the individual officers and directors are grounded in negligence, a review of the particulars set out in the Second Fresh as Amended Statement of Claim discloses that virtually all of the alleged breaches of a purported duty of care relate to the negligent investigation of the plaintiff. As found by both Master Mills and Justice Leiper, there is no available tort of negligent investigation against the corporate defendants. By extension, there cannot be a duty of care to protect against the commission of a tort that does not exist in law.

[18] In addition to the plaintiff’s failure, and likely inability given the previous decisions rendered in this matter, to plead the necessary material facts giving rise to an action in negligence, the draft Second Fresh as Amended Statement of Claim also lacks the required particulars to comply with the requirements relating to pleading allegations of personal liability against individual officers and directors.

[19] A corporation operates only through the actions of its individual officers, directors and/or employees. As held by the Court of Appeal in Normart Management Ltd. v. Westhill Re-Development Co. 1998 CanLII 2447 (ONCA), absent allegations of fraud, deceit, dishonesty or want of authority on the part of officers, directors or employees of a corporation, those individuals will be protected from personal liability unless a pleading properly sets out the actions or omissions of the individuals (a) to be themselves tortious, or (b) exhibit a separate identity of interest from that of the corporation so as to make the impugned act or conduct their own. Simply put, there must be some activity that takes the individuals out of their role of directing minds of a corporation.

[20] As held by Justice Dietrich in Libfeld v. Patica Corporation 2018 ONSC 3373, latitude for drafting deficiencies is less liberal when the Court assesses the adequacy of claims against corporate representatives. This approach finds support in the Court of Appeal for Ontario’s decision in Piedra v. Copper Mesa Mining Corp, 2011 ONCA 191 where the Court concluded that allegations in a pleading that the acts and omissions of a director are allegedly tortious must withstand a high degree of scrutiny.

[21] In the absence of a factual underpinning to support allegations that individuals acted outside their capacity as officers, directors or employees of a corporation, those individuals cannot be held personally liable for the actions of corporations they can control, direct or work for at the relevant time. That factual underpinning must relate to the actions or omissions of an individual that fall outside of his/her authority, exhibit a separate identity of interest, or are independently tortious and actionable.

[22] After having several opportunities, the plaintiff has not included sufficient, or arguably any, material facts to suggest that the unnamed officers and directors of Magna should be liable in their personal capacities. The plaintiff is hyper-focused upon the issue of negligent investigation, which has already been disposed of by this Court. As held by Justice Beaudoin in Matlock v. Ottawa-Carleton Standard Condominium Corporation 2021 ONSC 390:

“Given that a corporation is an inanimate piece of legal machinery and incapable of thought or action, the Court can only determine its legal liability by assessing the conduct of those who caused the company to act in the way that it did. The liability of the Condominium Corporation flows from the decision making of the individuals. There is no real distinction.”

[23] Whatever decision-making process was carried out by one or more of the unnamed individual officers and directors of Magna cannot establish a separate identity of interest based upon my reading of the draft Second Fresh as Amended Statement of Claim.

[24] For these reasons, the plaintiff’s motion is dismissed. Given that this matter has languished in the pleadings stage for more than two years, and the plaintiff has had several attempts to finalize his pleading, I do not believe it to be in the interests of justice to afford the plaintiff a further opportunity to amend his pleading. It is time for this claim, as it currently exists, to move forward.

Costs

[25] I would urge the parties to exert the necessary efforts to try and resolve the costs of this motion. If those efforts prove unsuccessful, they may exchange and file written costs submissions (totaling no more than five pages including a Costs Outline) in accordance with the following schedule:

a) the defendants shall serve and file their written costs submissions within 10 business days of the release of this Endorsement; and

b) the plaintiff shall serve and file his written costs submissions within 10 business days of the release of the defendants’ written costs submissions.

Diamond J.

Released: April 20, 2021