2021 ONSC 417
COURT FILE NO.: CV-19-0286-00
DATE: 2021-01-19
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Tanya Gammond
Mr. W. Mouck, for the Plaintiff
Plaintiff
- and -
Desjardins Financial Security Life Assurance Company A.K.A. Desjardins Insurance
Mr. J. Lim, for the Defendants
Defendants
HEARD: January 13, 2021 via Zoom, at Thunder Bay, Ontario
Mr. Justice F. B. Fitzpatrick
Judgment on Motion to Dismiss a Claim
[1] The defendant Desjardins Financial Security Life Assurance Company a.k.a. Desjardins Insurance (“Desjardins”) moves to have this action dismissed on the basis that this court has no jurisdiction over the subject matter of the action.
Background
[2] The plaintiff Tanya Gammond (Tanya) is a registered nurse. She is employed by St. Joseph’s Care Group in Thunder Bay. She stopped reporting to work on May 30, 2017. She commenced the within action May 30, 2019. In this action, among other relief, Tanya seeks a declaration she is entitled to indemnity under a disability policy issued by Desjardins and damages for breach of contract, breach of fiduciary duty, negligence and/or bad faith. Desjardins defends on the basis that, at all material times, Tanya’s terms and conditions of employment were covered by a collective agreement. As such, this court lacks jurisdiction to hear the matter and any disputes as to her entitlement to disability benefits should be determined by an arbitrator.
[3] The notices of motion filed by the parties framed the issue on a fairly broad basis. At conclusion of the motion, counsel agreed the motion should be considered and determined using the lens of r. 21.01(3)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
Facts
[4] Counsel provided the court with an agreed statement of facts. They are as follows.
Collective Agreement
[5] In 2017 and 2018, Joseph’s Care Group (“St. Joseph’s” or the “Employer”) was a participating hospital in the collective bargaining of a central collective agreement between St. Joseph’s and the Ontario Nurses’ Association (“ONA” or the “Union”). Both a central and local collective agreement govern the terms of employment for ONA members. The local collective agreement in force between St. Joseph’s and ONA does not address issues related to LTD benefits.
[6] The Central Collective Agreement (“Collective Agreement”) contains the following language at article 12.05:
Any dispute which may arise concerning a nurses’ entitlement to short-term or long-term benefits under HOODIP or an equivalent plan may be subject to grievance and arbitration under the Provisions of this Agreement. However, the nurse is required to use the carrier’s medical appeals process, if available to the nurse, to attempt to resolve disputes. The Union may file a grievance on the nurse’s behalf, but the arbitration hearing of the grievance will not occur until the determination of the nurse’s appeal, or within 90 days of the filing of the appeal, whichever is sooner. Any delay occasioned by the appeal will not count against the timeliness of the grievance, nor against any time limit in section 49 of the Labour Relations Act, 1995. For this reason, the time limit for referring such a grievance to arbitration will be extended for up to thirty-six (36) calendar days after the result is known to the Union.
Employment Details
[7] Tanya started working for St. Joseph’s as a Registered Nurse (“RN”) in 2004. In her position as an RN, she was a member of ONA. On June 12, 2016, Tanya accepted a temporary non-union position as Coordinator of the Transitional Care Unit (the “Coordinator position”) within St. Joseph’s.
[8] In the Coordinator position, Tanya performed managerial responsibilities and did not pay Union dues. According to an email from the Employer’s Manager of Employee Relations, Karie Ortgiese, Tanya’s Coordinator position was initially scheduled to expire on January 13, 2017. On December 21, 2016, the Coordinator position was extended to April 8, 2017, and on March 30, 2017, the Coordinator position was extended to June 3, 2017.
[9] Tanya was aware that the Coordinator position was temporary.
[10] Tanya was involved in the closing of the Transitional Care Unit (“TCU”), including planning for staff and patients to be moved out of the TCU by June 2, 2017. The benefits Tanya was entitled to while working in the Coordinator position, including short-term and long-term disability benefits, were governed by St. Joseph’s terms and conditions of employment for management and non-union staff. The LTD plan for non-union/management employees at St. Joseph’s is the Hospitals of Ontario Disability Income Program (“HOODIP”) Part B. ONA employees and non-union employees have the same plan.
[11] The collective agreement which applies to ONA members, specifically, article 10.11(a) provides:
A nurse who is transferred to a position outside of the bargaining unit for a period of not more than three (3) months, or is seconded to teach for an academic year shall not suffer any loss of seniority, service or benefits. A nurse who is transferred to a position outside of the bargaining unit for a period of more than three (3) months, but not more than one (1) year shall retain, but not accumulate, her or his seniority held at the time of the transfer. In the event the nurse is returned to a position in the bargaining unit, she or he shall be credited with seniority held at the time of transfer and resume accumulation from the date of her or his return to the bargaining unit.
[12] Tanya was working in the Coordinator position from June 12, 2016, to May 30, 2017, when she stopped working. She has not returned to work in any capacity since stopping work. Subsequent to stopping work, Tanya collected “sick earnings” from June 1, 2017, to September 13, 2017. From September 15, 2017, to December 27, 2017, Tanya received Employment Insurance (“EI”) medical benefits.
[13] According to a November 11, 2020 letter from Ms. Kathy Del Pino, Human Resources at St. Joseph’s, to Tanya’s legal counsel, Mr. Peter White, Tanya was returned to an RN role by St. Joseph’s as of June 11, 2017. Tanya did not actually work as an RN after that time, this is simply what St. Joseph’s records reflect, according to Ms. Del Pino.
[14] According to Tanya’s 2017 pay statements and 2017 T4, Tanya paid three installments of $95.96, for a total of $287.88 in union dues after commencing her medical leave. These deductions for union dues were made in July, August and September of 2017. According to an email from Ms. Naheed Yaqubian, ONA legal counsel, ONA members are not required to pay union dues after three months if on approved leave of absence.
LTD Claim
[15] Tanya was insured under a policy of group benefits insurance issued by Desjardins bearing policy number 541049 (the “Policy”) through her Employer, St. Joseph’s. Under the Policy, several classes of employees are defined, including Division 0027, which are St. Joseph’s employees who are members of ONA. Tanya applied to Desjardins for long-term disability (“LTD”) benefits in late November 2017.
[16] The Employer’s Statement for Tanya’s long-term disability benefits was completed by Ken Winko, a representative of the Employer on November 21, 2017. The Employer’s Statement identifies Tanya’s job title as Clinical Coordinator, the non-union position Tanya held at the time of her leave. The Employer’s Statement also identified Tanya’s division as 0027, which comprises St. Joseph’s employees who are members of ONA.
[17] On or about January 9, 2018, Desjardins received an Employee Statement signed by Tanya dated November 20, 2017, and Attending Physicians Statement dated January 8, 2018. These documents, along with the previously received Employer Statement, completed Tanya’s initial application form requirements for LTD benefits.
[18] On April 18, 2018, Tanya received a letter from Desjardins advising that her application for LTD benefits had been denied. Tanya then contacted a representative of the Union for advice and assistance under her belief this was the appropriate avenue for redress. The Union agreed to assist Tanya with her claim for LTD benefits. On May 15, 2018, the Union’s Labour Relations Officer, Joshua Henley, wrote to Tanya to advise her of the grievance process. In his letter, Mr. Henley states that Tanya may contact a lawyer about her rights, but that she should “tell the lawyer that the grievance is arbitrable”.
[19] On or about May 18, 2018, Desjardins received a letter of the same date from Mr. Henley stating Tanya was an ONA member and that ONA would be assisting in Tanya’s appeal. Tanya utilized the medical appeals process as outlined in the Desjardins letter dated April 18, 2018, and Tanya submitted two appeals via ONA, both of which were denied by Desjardins.
[20] Tanya was offered the option to continue appealing her claim by continuing to submit further medical documentation or as part of the appeal process. Tanya was also offered the option to participate in the Medical Appeals Process (“MAP”). The MAP is an optional appeal process separate than the standard process of sending in further medical documentation. The MAP is an option available to Tanya, but, as a condition, requires her to relinquish her right to a civil action for LTD benefits.
[21] As part of the MAP, an independent physician is chosen jointly by Desjardins’ medical consultant and the claimant’s chosen physician. The independent physician will review all available medical and functional evidence, and undertake additional tests or examinations, as deemed necessary (for example, performing a medical examination). The independent physician will determine if the claimant is totally disabled as per the definition of disability in the applicable policy. The decision of the independent physician is binding on the claimant, Desjardins and the OHA, and no further action can be taken.
[22] Following the denial of her LTD benefits, Tanya commenced a grievance against her Employer with the support of ONA. An arbitration regarding the denial of disability benefits was originally scheduled for July 4, 2019. However, the arbitration date was adjourned on consent and is currently being held in abeyance pending Tanya’s instructions to ONA to proceed.
[23] In February of 2019, ONA’s then lawyer, Jessica Page Figliano, advised Tanya that the Employer would raise an objection and argue her case was not arbitrable. Ms. Figliano advised Tanya to seek independent legal advice, as a limitation period may be approaching, and this action was commenced by Tanya on May 30, 2019.
[24] On or about June 24, 2019, Tanya was advised by Ms. Naheed Yaqubian, ONA’s legal counsel, that St. Joseph’s would no longer be making a preliminary motion regarding arbitrability, but instead would make a preliminary motion that the grievance was premature because Tanya had not utilized the insurer’s MAP. According to a May 14, 2020 email from Ms. Sharan K. Basran, ONA legal counsel, to Mr. Peter White, Tanya Gammond’s legal counsel, ONA requires Tanya to agree to the MAP in order to proceed forward to grievance arbitration.
[25] Both counsel for the Union and the Employer were served with notice of this motion and have indicated their respective clients do not intend to participate in this motion.
Positions of the Parties
[26] Counsel agreed the facts were not in dispute. The legal conclusion to be drawn from the facts is disputed.
[27] Counsel for Tanya argued that at the time her disability arose, she was working in a non-union position with a benefits plan that was not subject to any collective agreement. Tanya argues the circumstances on the day she became disabled is the key fact from which the jurisdiction of this court rises or falls. The fact that she was only temporarily working in that non-union position is irrelevant to the issue of jurisdiction of the Superior Court. The fact that three days after she stopped working, the employer treated her as if she was back in the bargaining unit is irrelevant to the issue of jurisdiction of the Superior Court. The fact that from May 2017 to May 2019, she acted as if the matter was covered by the collective agreement is irrelevant to the issue of jurisdiction of the Superior Court.
[28] Counsel for Tanya relies on a recent decision of the Ontario Court of Appeal in Skof v. Bordeleau, 2020 ONCA 729. Counsel argues the test that must be applied on this r. 21.01(3)(a) motion is succinctly set out at paragraphs 8 and 9 of the decision, where Nordheimer J.A. wrote:
The basic proposition applicable to r. 21.01(3)(a) can be stated fairly simply: either the Superior Court of Justice has jurisdiction over a claim or it does not. In deciding that issue, it must be remembered that the Superior Court of Justice, as a court of inherent jurisdiction, has jurisdiction over every conceivable claim unless (i) the claim does not disclose a reasonable cause of action or (ii) the jurisdiction has been removed by legislation or by an arbitral agreement: TeleZone Inc. v. Canada (Attorney General), 2008 ONCA 892, 94 O.R. (3d) 19, at para. 92, aff’d 2010 SCC 62, [2010] 3 S.C.R. 585.
Some prior authorities have debated whether it is appropriate to use the “plain and obvious” test under r. 21.01(3)(a). I do not think it is helpful to further that debate. It is clear that, in order to find that the Superior Court of Justice does not have jurisdiction to entertain a claim, it must be “clear and unequivocal” that the jurisdiction has been ousted.
[29] Significantly, the Skof decision involved a question of whether or not an employee was covered by a collective agreement and was accordingly precluded from pursing an action in the Superior Court. The Court of Appeal decided in Skof, at para. 14, that the person at issue was, by agreement, not subject to the terms of a collective agreement. Also, despite the fact that the plaintiff at issue had filed a grievance concerning the dispute at issue, the Court of Appeal determined this was out of an abundance of caution and did not impact on the proper interpretation of the contractual arrangements between the parties.
[30] Counsel for Tanya argues the dispute at issue is Tanya’s entitlement to claim under a disability policy that was available to non-union employees.
[31] Counsel for Tanya argues there is no evidence of an agreement for Tanya to return to the bargaining unit as of the day she alleges she became disabled and could no longer report to work, namely May 31, 2017. On that day, she was a non-union employee who was not covered by a collective agreement. As such, the Superior Court has jurisdiction to consider and adjudicate the dispute.
[32] Counsel for Desjardins argues Skof is distinguishable on the facts from the matter before the court. Instead, counsel for Desjardins points to the decision of the Court of Appeal in Claxton v. BML Multi Trades Group Ltd. (2003), 2003 CanLII 34634 (ON CA), 177 O.A.C. 190 (Ont. C.A.). That matter also involved an issue of the scope of a motions judge’s jurisdiction to determine matters alleged to arise under a collective agreement.
[33] At paragraphs 12 through 15, Abella J.A. (as she then was) wrote:
With respect, the motions judge lacked jurisdiction to embark on an inquiry into whether Mr. Claxton was exercising managerial functions. The only issue he ought to have considered was whether the core of the jurisdictional dispute before him was governed by the terms of the Collective Agreement. By assessing instead the merits of the dispute, namely, whether Mr. Claxton was an employee covered by the Collective Agreement, he was trespassing on arbitrable territory.
McLachlin J., in adopting the ‘exclusive jurisdiction’ model for the resolution of labour disputes in Weber v. Ontario Hydro, 1995 CanLII 108 (SCC), [1995] 125 D.L.R. (4th) 583 (S.C.C.), stated, at p. 602, said:
“The question in each case is whether the dispute, in its essential character, arises from the interpretation, application, administration or violation of the collective agreement.”
This approach finds resonance in s. 48 (1)[1] of the Labour Relations Act, as well as in s. 133 (1)[2], which applies to the construction industry. Both provisions confirm that differences between the parties relating to the interpretation, application, administration or alleged violation of a collective agreement, including any question as to whether a matter is arbitrable, are to be determined in accordance with the Collective Agreement.
The preliminary dispute between Mr. Claxton and BML is whether he is covered by the Collective Agreement. If he is, the dispute over his termination will be arbitrated. If he is not, it will proceed in the Superior Court of Justice as a wrongful dismissal action. But the issue whether the dispute is arbitrable, engages squarely the application and interpretation of the Collective Agreement and the motions judge, accordingly, had no jurisdiction to make that determination.
[34] At paragraph 34 of its factum, Desjardins concedes that Tanya was in a non-bargaining unit position on May 30, 2017, the day she stopped reporting to work. However, in November 2017, when Tanya applied for the LTD benefits at issue in the statement of claim, she did so as a bargaining unit member having been returned to the bargaining unit on June 11, 2017. Accordingly, it is clear the parties intended any disputes concerning Tanya’s eligibility for disability benefits would be determined by the arbitration process called for in the collective agreement. The LTD benefit at issue is granted by a collective agreement. The time for determining the applicable adjudication route is when the claim is made, not when the disability arose. Any dispute therefore falls within the exclusive jurisdiction of an arbitrator and this court has no jurisdiction over such a dispute. Relying on the decision of the Supreme Court of Canada in Weber (cited above, in Claxton), Desjardins argues this dispute is one that arises expressly or inferentially from the collective agreement and therefore must be dealt with by mechanisms provided by that agreement.
Disposition
[35] I find the Superior Court of Justice has jurisdiction to adjudicate this dispute. Desjardins motion is dismissed with costs for the following reasons.
[36] Skof provides the framework for determining this motion. This court has jurisdiction over this claim unless (i) the claim does not disclose a reasonable cause of action or (ii) the jurisdiction has been removed by legislation or by an arbitral agreement.
[37] Desjardins did not argue the claim does not disclose a reasonable cause of action. The claim does disclose a reasonable cause of action. If Tanya was an employee whose employer offered LTD benefits, and a claim was made and denied, a person can reasonably assert a claim to those benefits.
[38] Desjardins does not argue that legislation has removed the jurisdiction of the court from adjudicating this particular dispute. Employees can sue insurance companies if they believe their claim to an employment benefit has been improperly denied.
[39] Desjardins does argue that by arbitral agreement, namely the collective agreement between ONA and St. Joesph’s Care Group, this court’s jurisdiction to allow Tanya to sue for LTD benefits is ousted and the arbitral routes covered by the agreement must be followed.
[40] I acknowledge the obvious. If a person is covered by a collective agreement, any issues concerning the interpretation, application and administration of that collective agreement cannot be determined by a Superior Court.
[41] However, on the uncontroverted evidence in this matter, there is no issue that Tanya was anything other than a non-bargaining unit employee on May 31, 2017, the day after she stopped reporting to work. This was the material date with respect to the determination of what body has jurisdiction to entertain Tanya’s claim.
[42] In Ontario, our labour law jurisprudence and statutes recognize only two basic categories of employees. Persons who are covered by collective agreements and persons who are not covered by collective agreements. Different types of rights flow to these two basic categories of employee. There is no such thing as a hybrid “union/non-union” employee, unless such a category is created by express agreement by an employee not represented by a trade union and an employer, on the one hand, or by a trade union on behalf of the employees it represents collectively and an employer, on the other.
[43] In this case, I agree with Tanya’s submission that she did not expressly agree in writing to return to the bargaining unit after May 30, 2017. The collective agreement between St. Joesph’s Care Group and ONA made no provision for persons like Tanya, who had taken temporary non-union positions with the employer, except with regard to one very specific matter. Article 10.11 of the applicable collective agreement provided that a nurse who was absent from the bargaining unit for more than three (3) months and less than one (1) year would retain but not accumulate seniority. Otherwise, the collective agreement does not apply to that nurse while she is employed in a non-bargaining unit position. This is a very important fact in my view.
[44] Seniority is an important right for persons covered by collective agreements. Yet in this case, a circumstance where the employer had offered a bargaining unit employee an opportunity to work non-union, the parties had turned their mind to this situation. They agreed that only seniority would be maintained but would not accumulate. No other rights, no other benefits and no other specified rules provided in the collective agreement would apply to the nurse and the employer, at least as far as the collective agreement was concerned, while the nurse was in that non-bargaining unit position.
[45] Nevertheless, the employer offered non-bargaining unit persons benefits, including coverage for LTD. These benefits did not arise from the collective agreement.
[46] In my view, on the facts of this case, and specifically based on the acknowledgment by Desjardins that on the date Tanya stopped working, she was a non-bargaining unit employee, Tanya was not covered by a collective agreement on May 31, 2017. This is the day in the claim she asserts she became disabled and was therefore entitled to claim LTD benefits. I was not asked to make that finding on this motion. It was a fact that did not require adjudication on this motion.
[47] Under the LTD policy, Tanya had to be totally disabled during the qualifying period to be eligible for LTD benefits. The “qualifying period” is defined in the applicable policy as “the period, as specified in the Benefit Schedule, of continuous Total Disability that must be completed before Long Term Disability Benefits commence under this Benefit”. The “Date of Disability” is defined by the LTD policy as “the first day of regularly scheduled employment for which you cannot report due to injury or illness”. The date of disability in this case is therefore May 31, 2017. On that day, Tanya was not in the bargaining unit.
[48] I am not required to make a determination infringing on an arbitrability issue in order to adjudicate this motion. Unlike the problem that presented to the court in the Claxton decision, there is no issue, no dispute and no need to determine what was Tanya’s status on the date she became disabled. She was a non-bargaining unit employee. Desjardins concedes this point. In order to decide jurisdiction, I am not trespassing on the territory of arbitrability. If this matter did proceed to arbitration because Tanya agreed to go that route, there would no question of arbitrability. The only issue is one of entitlement to benefits.
[49] I agree with the submission of counsel for Tanya that there is no express agreement for Tanya to return to the bargaining unit as of May 30, 2017, or May 31, 2017. I agree it is speculation on the part of Desjardins to argue that she would return to the unit. Whatever the employer did was a unilateral decision by them. They placed her back in the bargaining unit on June 11, 2017. I agree with Tanya’s submission that that action has no bearing on the question of the jurisdiction of this court to hear this matter. I agree with Tanya’s submission that whatever the employer did or did not do after May 30, 2017, cannot change the fact that as of May 31, 2017, Tanya was assigned to a non-union bargaining unit position.
[50] On the basis of the agreed facts, it is not clear and unequivocal to me that jurisdiction of the court has been ousted for the dispute as framed by the statement of claim filed by Tanya. Quite the contrary. The place of original jurisdiction in Ontario for non-union employees to go to determine civil disputes with their employer is the Superior Court of Justice. It is certain that people in non-union employment relationships can modify their rights by agreeing to submit their disputes to private adjudicative methods and avoid the original jurisdiction of the Superior Court. In my view, that is not the case here.
[51] I was not persuaded by the argument of Desjardins that the reasoning of the Supreme Court of Canada in Weber applies here. This is because the essential character of the dispute is not one covered by the collective agreement, because Tanya was definitively not subject to a collective agreement on May 31, 2017.
[52] On the language of the policy, the date Tanya applied for benefits is not determinative of an issue concerning jurisdiction. Tanya is entitled to claim against the insurance company that provided LTD coverage to the non-union employees of her employer as of the date she asserts she became disabled, namely May 30, 2017. Of course, her success in this matter is not a forgone conclusion. It will await adjudication in this court.
[53] At the commencement of the motion, counsel indicated they had agreed on the quantum of costs for the successful party. Accordingly, Tanya will have her costs of this motion payable by Desjardins forthwith in the amount of $5,000.00 inclusive of disbursements plus HST.
“original signed by” The Hon. Mr. Justice F.B. Fitzpatrick
Released: January 19, 2021
2021 ONSC 417
COURT FILE NO.: CV-19-0286-00
DATE: 2021-01-19
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Tanya Gammond
Plaintiff
- and -
Desjardins Financial Security Life Assurance Company A.K.A. Desjardins Insurance
Defendants
JUDGMENT ON MOTION TO DISMISS A CLAIM
Fitzpatrick J.
Released: January 19, 2021
/lvp