HomeMy WebLinkAbout1980-0348.Knudson.81-03-10 Decision180 DUNDAS STREET WEST, TORONTO, ONTARIO. M5G lZ8 -SUITE 2100
Between :
Before:
IN THE MATTER OF AN ARBITRATION
Under The
CROWN EMPLOYEES COLLECTIVE BARGAINING ACT
Before
THE GRIEVANCE SETTLEMENT BOARD
Mr. Ronald Knudson - And -
The Crown in Right of: Ontario (Liquor Licence Board of Ontario)
TELEPHONE: 416/598- 0688
348/80
Prof. J. W. Samuels Vice Chairman Ms. B. Lanigan Member Ms. M. Perrin Member
For the Grievor: Mr. M. Levinson, Counsel Golden, Levinson
J For the Employer: Mr. C. G. Riggs, Counsel Hicks, Morley, Hamilton, Stewart and Storie
Hearings :
January 9, 10 1981 February 12, 73, 14, 1981
2
CONTENTS
Page
INTRODUCTION................................ ......... 3
NATURE OF THE EVIDENCE.. ............................. 4
8
8
FACTS DISCLOSED BY THE EVIDENCE......................
... a. The grievor's job and work record.......
b. Form 163 and weekly reports ................ 12
c. Form 220 and semi-annual inspections ....... 19
CONCLUSION. .......................................... 30
LIST OF EXHIBITS............................... ...... 32
3
INTRODUCTION
This matter involves
now, this injustice has almost
a grave injustice. Up to
ruined the life and career of
the grievor. I have come to this firm conclusion after a
very careful and close review and consideration of all the
evidence and argument put before this Board of Arbitration.
The grievor was discharged from his employment as
a District Inspector with the Liquor Licence Board of Ontario
on May 20, 1980 (Exhibit 67). This followed the grievor's
conviction on
a number of criminal charges related to the
way in which he had completed certain forms filed regularly
with his employer. He had also been charged with the of-
fence of taking benefits under section 11O(c) of the Cri-
minal Code, but these charges were dismissed at trial.
Indeed, the benefits suggested were trivial and even these
benefits
were not proved in spite of a massive police in-
vestigation.
Prior to the discharge, the grievor had been
subjected to
a very public condemnation in the local media
in his Ottawa area, to national coverage of the allegation
that he and others accepted benefits, to a rigorous investi-
gation by the Ontario Provincial Police, and to suspension
from his job without pay as. of April 5, 1979 , pending the
disposition of the criminal charges which were brought
against him and others on April 4 by the Ontario Provincial
Police. The suspension was announced in the Ontario Legis-
lature on April 5 by the Honorable Frank Drea, Minister of
Consumer and Commercial Relations. It was not until April 9
that the grievor and others received personal word of the
suspension by registered mail.
The grievor and others grieved the suspension
without pay. A hearing was held on December 19, 1979. The
unanimous decision of that Board of Arbitration was that the
grievor and others should be reinstated pending the
trial
(Grievance Settlement Board, 277/79, M. Eberts - Vice-
Chairman). Unfortunately, this award had no effect for two
reasons. Firstly, it was issued August 7, 1980, after the
criminal
trial was over and the suspension had been turned
into a full discharge from employment. Secondly, the Liquor
Licence Board appealed the award and the matter is still
pending before the Divisional Court.
The grievor now grieves his discharge and the
employer has accepted that it has the onus of justifying the
discharge. Our hearings convened in Toronto
on January 9
and 10, and February 12, 13 and 14, 1981.
NATURE OF THE EVIDENCE
At the outset, the parties agreed that the tran-
script of the 6-day criminal trial, and the exhibits filed
at trial, would be evidence before this Board of Arbitra-
5
tion, except for several diaries of the grievor seized by
the Ontario Provincial Police and not released to the ar-
bitration.
In addition to the exhibits at trial, we 'had filed
with us several documents.
the List of Exhibits at the end of this award.
All of the exhibits appear in
The Liquor Licence Board called as witnesses Mr.
Russell Cooper, Executive-Director of the Board, and Mr.
Everett Steele, who had been the grievor's immediate super-
visor during the critical period. For the grievor's case,
we heard Mr. T.R. Dempsey,
also a former District Inspector
for the LLBO in the Ottawa area and convicted of similar
charges: Mr. J.A. Simpson, a District Inspector for the LLBO
in Hastings County and in the Counties of Lennox and Addington;
and the grievor himself.
Before turning to the facts disclosed by the
evidence, it is appropriate to make some general comments on
the evidence before this Board of Arbitration.
The trial transcript has been most useful. It
must be recognized that we did not have the benefit of
actually seeing and hearing the witnesses testify.
a drawback.
objective correctness of it and by assessing the manner of
the witness giving evidence under oath. In this case, we
This is
One determines the truth of testimony by the
6
can assess the evidence at trial' by the objective correct-
ness of it and by the comments on it made in the decision of
His Honor Judge Elmer Smith. At this point two observations
may be made:
1. Judge Smith characterized Mr. Knudson's
evidence as follows (at page 15) -
"I cannot unfortunately place any reliance
upon the accused's diary or daily sheets or
even the master sheets, which may well be a
reconstruction, perhaps months perhaps years
after the event, nor were the rationaliza-
tions, exaggerations and constant irrelevant
discourses on the volume of work, or the
general evasiveness of the accused, were very
successful in inspiring confidence in the
acceptability of the accused's testimony."
2. Judge Smith accepted Mr. Steele's evidence
concerning the need for a signature on the
semi-annual inspection form (at pages 12-
13). He makes no other mention of the evi-
dence of
Mr. Steele.
.
With respect to the witnesses who appeared before
this Board of Arbitration, the following comments can be
made :
1. Mr. Cooper appeared to be a fully honest
witness. However, he was not familiar with
some matters very relevant to this case and
acknowledged his lack of knowledge. In
particular, he did not have any real know-
ledge concerning the training of District
Inspectors, nor the actual practice in the
inspection field. He had never been per-
sonally involved in inspection. He did not
really know the reasons for the discharge.
The decision had been made by Mr. Eber Rice,
Chairman of the LLBO.
2.
Mr. Steele was not a credible witness at all.
His manner under oath was highly suspect. In
many critical respects, his evidence has no
objective credibility. For example, Mr.
Steele agreed that Mr. Knudson was a con-
scientious employee who normally worked
around 55 hours per week. He also agreed
that inspectors did not get overtime and
therefore "banked' cap ls i f they worked
7
3.
4.
5.
longer hours and made more visits than were
called for in a 40-hour week. Yet he testi-
fied that he expected the weekly reports of
the inspectors to show the dates and times of
visits accurately "within a half-hour or
hour". It is obvious that if an inspector
reported his 55-hour work week fully he would
be entitled to a great deal of overtime under
the Collective Agreement. Obviously, "some-
thing had to give" and it was the accuracy of
these weekly reports, of which I'll have a
great deal more to-say shortly. Furthermore,
Mr. Steele was quick to change his testimony
whenever he was confronted with a document or
reference to earlier testimony by himself or
another senior employee which contradicted
his statement.
Mr. Steele gave all his evidence after re-
questing protection under the Ontario and
Canada Evidence Acts. Mr. Levinson asked
that this award record his objection to Mr.
Steele's request, because one may wish to
attack the alleged privilege in subsequent
proceedings.
Mr. Dempsey has been implicated in this sit-
uation, was convicted of several charges
similar to those involved in the grievor's,
conviction, and has also grieved his dis-
charge by this employer. These circumstances
mean we must be very vigilant in approaching
his evidence. He testified before us. I
observed him closely. I have considered the
objective correctness
of his testimony.
accept his evidence as being truthful.
I
Mr. Simpson impressed me as a completely
honest man. He was called to testify that he
used the forms in a manner similar to the way
in which Mr. Knudson and Dempsey did. He was
uninterested in requesting the benefit of the
Ontario and Canadian Evidence Acts. His
testimony was clear and precise.
It was ob-
jectively reasonable.
in examination-in-chief and upon cross-
examination.
He was completely open
Mr. Knudson himself seemed to be an honest
man. Judge Smith's comments at trial con-
cerning the grievor's "rationalizations" and
"constant irrelevant discourses." were borne
out in our hearing. However, I did not sense
any ''general evasiveness" nor any "exagger-
ations". My profound impression is that Mr.
Knudson is quite a disorganized man and his
testimony too was disorganized in spite of
the very clear and able examination-in-chief
and cross-examination.
I . . .. .- -. -. ..-- I "
8
We turn now to the facts disclosed by the @vi-
dence .
FACTS DISCLOSED BY THE EVIDENCE
a. The grievor's job and work record
The grievor
is a 47 year old man, married with
three children. He lives in Gloucester City, near Ottawa.
Before coming to the Liquor Licence Board in 1974, he had
worked for eight years
as the service manager of the Ottawa
Typewriter Company, and then twelve years in sales and
public relations for the John Labatt Company. Up to the
circumstances leading to this arbitration, the grievor had a
perfectly clean work record with all his employers and had
never been convicted of a criminal offence, "not even a
speeding ticket"
(from the trial transcript, at pages 248-
9)
In 1974, he joined the Liquor Licence Board of
Ontario as a District Inspector in the Ottawa area. An
inspector works on the enforcement of various pieces of
legislation, including The Liquor Licensing Act. There are
a variety of tasks which must be performed, including numerous
visits for
a number of different reasons to establishments
where liquor is served.
9
The two most important aspects of the job are that
it is done largely on one's own out of an office in the
inspector's home, and it takes some people (the grievor is
one
of them) more hours in a day than 8 and more hours in
the week than 40. I accept the grievor's evidence that on
average he worked something like 50 to 55 hours per week.
The LLBO required that the grievor do work which took that
long to complete.
The Collective Agreement between the LLBO and the
Ontario Liquor Boards Employees' Union provides in Article 5
for "Hours of Work and Overtime". The Agreement is clear on
how the-grievor, and others in his position, should be paid.
In Article 5.2, it provides:
"where employees in these classifications perform
authorized work in excess of eight (8) hours per
day or forty (40) hours per week, they shall be
paid at overtime rates as defined in Articles 5.6
and 5.7."
And Article 5.6 provides:
(a) Authorized work performed in excess
of
the employee's regular work day shall be paid at
the rate
of one and one half (1-1/2) times the
regular hourly rate to the employee unless other-
wise provided in this Agreement. All work per-
formed on any second consecutive day of overtime
shall be paid at double the employee's regular
rate of pay.
(c) Liquor Licence Inspectors who perform
authorized work under Article 5.2 shall take lieu
days in payment of such overtime worked providing
work demands on the Inspectors are such to permit
the Board to grant such lieu days no later than
the end of the month next following the month in
which the overtime occurred. Where this is not
the case the Inspectors shall be paid overtime
rates in accordance with Article 5.6 (a) .
10
(d) Where an employee is required to work on
a Sunday as part of that employee's regular shift,
the employee is to be paid at the rate of one and
one half (1-1/2) times the regular hourly rate of
the employee.
(e) Where an employee is required to work on
a Sunday, provided the Sunday is not part of the
employee's regular shift, the employee shall be
paid at the rate of twice the regular hourly rate
of the employee.
The grievor was required to work 1 night per week,
1 Saturday per month, and 1 Sunday every 3 months (at one
time it was
1 Sunday every month).
There is absolutely no doubt that the grievor was
entitled to a great deal of overtime pay. Yet, when he was
hired, he was informed that no overtime was ever paid to an
inspector. and none ever was paid to the grievor. He never
-
claimed any overtime.
This situation was maintained by a deliberate
circumvention of the Collective Agreement by the Liquor
Licence Board of Ontario for budgetary reasons. In the area
of inspection, it led to practices in the completion of
reports designed to mislead concerning the number
of hours
worked. As will be seen, the grievor was convicted in part
because of his compliance in a reporting system designed to
deny himself and other employees
of the overtime pay to
which they were lawfully entitled under the Collective
Agreement.
11
The point cannot be made clearer than with respect
to Sunday work.
work
at least 1 Sunday every 3 months.
absolutely clear that this requires pay at 1-1/2 times the
regular rate of pay. There is no provision for lieu time.
The grievor would be expected to, and did, make emergency
The grievor and others were required to
Article 5.6(d) is
calls on Sundays when problems arose. Article 5(e) is
absolutely clear that this time should be paid at twice the
regular hourly rate.
time.
of work over 8 hours per day or over 40 hours per week.
Sunday work commands overtime pay.
it was made clear none ever would be paid.
Again there is no provision for lieu
Article 5(c) provides for lieu time only in the case
None was ever paid and
Lieu days, day
for
the
the
the
day, were taken in respect of scheduled Sunday work. .
And how was overtime avoided? By normally having
inspector report Sunday work on another day, except for
Sundays when the inspector
was scheduled to work. And
same system applied to night work on non-scheduled
nights and Saturday work on non-scheduled Saturdays. More
on this in a moment.
cannot be overemphasized. The grievor stands convicted on .
some criminal charges, and was discharged from his employ-
ment, in part because he participated
in a charade designed
to deny liquor licence inspectors the overtime pay to which
they
were clearly entitled.
But the cruel irony of the situation
12
b. Form 163 and weekly reports
Form 163 is entitled "Inspectors Daily Report". It
is in fact a weekly reporting form with the instructions on
the top:
"Duplicate copies of this form must be sent in
each week and must agree with Statement of Travelling
Expenses to be
sent in every two weeks."
The form contains a series of columns, in which an inspector
is to record
- the date - the place - 'the establishment or office visited - the type of inspection - the time of' the call.
Mr. Cooper testified that the purposes of this
form are: b
- to provide an accurate reflection of the
number and type of inspections
- to provide evidence that an inspector did his
work because they
are on their awn and must
account for their hours worked
- to provide a check on the expense accounts
submitted by inspectors, in particular for
gas mileage
- to provide an audit for the Personal Atten-
dance Register. This
is Form 164 and is a
record of the days worked. It is interesting
to note that the old version of the Register
(a copy was part of Exhibit 70) provided
space for the entry of hours worked. The
copy we have in evidence simply records "On
Duty". The new version of the Register does
not ask for hours worked, just whether or not
the employee
was on duty or not, and if not
why not, for each day of the week (Exhibits
33 and 53)
e to provide statistical information on the
numbers and types of inspections.
13
He testified that he knows of no instructions to inspectors
to fill out the forms improperly and inaccurately, nor does
he know of any supervisors condoning this practice. I
believe him. However, Mr. Cooper came to the LLBO in January
1976 from the position of Executive Assistant to the Attorney-
General
of Ontario, and before that Executive Assistant to
the Minister of Consumer and Commercial Relations. In this
latter capacity, he had been involved in setting up the
current operational procedures of the LLBO. He was not in-
volved in the personnel operations
of the LLBO while in the
Ministry of Consumer and Commercial Relations.
is not involved in the supervision of inspectors and, in
particular, has no knowledge whatsoever of the training of
inspectors prior to 1976.
Currently he
The fundamental point in all of this is that Mr.
Cooper took over as Executive-Director of the LLBO: after men
like the grievor had been trained and were in the field
working in established ways. And up to the incidents leading
to this arbitration, no changes in general practice or
instruction were made by Mr. Cooper or anyone else. I find
as a fact that, unknown to Mr. Cooper, when he came to the
LLBO, a system of inaccurate weekly reports was in place for
budgetary reasons dictated by the LLBO itself, and no one
ever changed that system, indeed the budgetary constraints
became even more severe in late 1977 Therefore, Mr. Cooper
may have formed some very good personal reasons for the need
for accuracy in the weekly reports on Form 163 but these
, 14
reasons were never implemented in policy or practice because
the pattern had been established well before he arrived.
This is the absolutely uncontradicted evidence of Messrs.
Dempsey, Simpson and Knudson.
Moving to the reality of the situation and the
training and experience of the inspectors. Mr. Dempsey
joined the LLBO as an inspector in September 1970 and was
trained by Mr. Harry Royle, a District Inspector in Toronto.
Mr. Simpson joined the LLBO as an inspector in 1973 and was
trained by Mr. Stan Hogarth, then a special investigator.
Mr. Knudson joined the LLBO as an inspector in 1974 and
trained with Mr. Don Evans, a special investigator. There
is no significant difference whatsoever in the testimony of
all three men on what they learned to do with Form 163.
The Form was made up at the end of a week's work,
or sometimes a week or so later. It was to be a record of
calls
made but was never intended to be and never was an
accurate record as to day and time. Mr. Dempsey had worked
with Mr. Jack Lawrence, now in senior management in the
inspection area and together they had filled out their
weekly reports in this way so that they would coincide. He
had worked with Mr. Steele and the same system applied. He
had worked with special investigator Don Evans and the same
system applied. Mr. Simpson had worked with Mr. Steele and
they filled out their weekly reports in this way to coincide
with each other. He had worked with Mr. Jack Lawrence and
15
they did it this way. Mr. Knudson had worked together with
Mr. Steele and they had done it this way. Mr. Steele says
that when he worked with others he consulted them on the
weekly report to ensure the
two men's reports coincided
accurately. I simply do not believe Mr. Steele. It had to
be obvious that the reports were not accurate as to time and
day (in particular where the joint visits lasted more than
one day). In short, this
was the way it was done. And the
men were told to "level off" or "balance out" the days and
weeks - that is, to show roughly 5-7 calls per day and
roughly 40 hours per week. They were never to show work
done on a non-scheduled night, non-scheduled Saturday or
non-scheduled Sunday. By doing this, they would not excite
the Treasury into thinking it had to pay overtime. No
overtime would be paid. Lieu
time would be given day for
day.
Now some things were entered accurately on Form
163 - visits made to do a semi-annual inspection, visits
concerning fire work orders, and some spot checks when a
particular problem had arisen and an inspector was speci-
fically asked to make a series of spot checks. The calls
were recorded in such a way that the actual mileage covered
and shown on expense forms would tally. If 10 calls were
made one day at an out-of-town location, only six might be
shown and the other 4 retained in the "bank" until another
visit to that location was made. Then the 4 "banked" calls
would be shown. In general, the weekly report was treated
16
simply as a list of calls made.
and the inspectors never felt they were deceiving anyone in
any way because the reports were only relevant to persons in
management, who had also been inspectors and knew the way in
which Form 163 was prepared. Indeed, there is no evidence
that Mr. Cooper ever made use of Form 163 or was ever misled
Everyone did it that way
by a Form 163.
The charade became even more ridiculous when the
inspectors under Mr. Steele were told by him not to record
times like 1:00 or 2:00, but to make it look even more
accurate, eg. 1:14 and 2:06.
Turning to the Form 163's prepared by Mr. Knudson,
which have been filed
as 'exhibits in this arbitration. I
have reviewed every one of them, in particular the several
hundred pages found in Exhibits 31 and 32. He acknowledged
at trial that they were largely inaccurate as to day and
time. By and large they show 48-49 hours per week. The
days are leveled out at 5-6 calls and 8 hours per day,
except for the day per week with a scheduled night, in which
case the day is shown as 15-17 hours long. The Forms appear
to show Saturday and Sunday work only on scheduled weekend
days, because there
are just enough of them shown to satisfy
the required schedule. For example, for Sundays, the fol-
lowing appears in Exhibits 31 and 32:
Exhibit 31
Sunday, April 9, 1978, did a series of spot checks
(May 23, 1978, shown as off-duty in lieu of April
9, 1978)
Sunday, June 25, 1978, on an out-of-town trip with
Mr. Dempsey.
(1978 is slimly represented in Exhibit 31 and this
is all the Sunday information which appears.)
Exhibit 32
Sunday, April 24, 1977, did a series of spot checks
Sunday, May 29, 1977, did a series of spot checks
(August 4, 1977 off in lieu)
(August 5, 1977 off in lieu)
Sunday, June 19, 1977, did a series of spot checks
(August 22, 1977 off in lieu)
Sunday, July 10, 1977, did a series of spot checks
(August 29, 1977 and September 6 shown as off in
lieu!
Sunday, August 21, 1977, did a series of spot checks
(October 11, 1977 off in lieu)
Sunday, August 28, 1977, did a series of spot checks
(November 10, 1977 off in lieu)
Sunday, October 2, 1977, did a series of spot checks
Sunday, November 6, 1977, did a series of spot checks.
NOW, this review of Mr. Knudson's Form 163's leads
to the following findings
of fact:
1. The surveillance evidenced at trial, and Mr.
Knudson's own admissions, show that the
entries
are largely not accurate as to day
and
time.
2. He did "level off" to 5-7 calls and 8 hours
per day, except for the day with a scheduled
night.
18
3. He did not "level off" to 40 hours per week,
the Form 163's were in any way relevant to
the remuneration Mr. Knudson was to receive
from the LLBO, how could the Board justify
not paying him at least 7 hours of overtime
every week? The answer seems irresistible -
while the forms were "leveled off" to avoid
showing the need for overtime, in any event
they served
no purpose related to an in-
spector 's pay, because, even where overtime
was shown and (as Mr. Riggs argued) accuracy
expected, no overtime was paid. The LLBO
cannot have it both ways. If the Board
expects accuracy, then
it must pay for over-
time shown.
shown, why should it expect accuracy?
Work actually performed on non-scheduled
nights, non-scheduled Saturdays 'and non-
scheduled Sundays was never recorded on the
day it was done. Mr. Knudson appears to have
followed this injunction rigorously.
yet he never received any overtime pay. IF
If it doesn't pay for overtime
4.
In his decision after the trial, His Honor Judge
Smith concluded that Mr. Knudson intended to mislead the
LLBO, that the dailies were false to the knowledge of the
accused "and that he forwarded them to the Board intending
that they be taken as accurate" (page
11).
respect, I disagree with that decision and I do so based on
more evidence. His Honor heard
only Messrs. Knudson and
Steele and a very bad witness in support of
Mr. Knudson.
This Board of Arbitration has also heard Mr. Dempsey and, in
With the greatest
particular, Mr. Simpson. We have read the trial transcript
and studied the exhibits at trial and other documents. The
total evidence before us leads clearly to the conclusion
that Mr. Knudson never intended to deceive the LLBO, nor
could he have any expectation whatsoever that his weekly
reports on the Form 163's would be taken as accurate. He
19
was instructed to do these Forms in this way in order to
defeat his own right to the overtime to which he should have
been entitled.
accurate when his leadership permitted
a system which paid
no overtime, even when the Forms showed more than 40 hours'
per week, week after week? The answer is clearly that the
LLBO did not rely on the accuracy of Form 163.
happened throughout Mr. Knudson's employment ever indicated
to him that his Forms were being relied on as accurate.
Indeed, his training and all the other circumstances, told
him that he was to continue using the Form 163's as he was
doing, in order to continue to defeat his own rights under
the Collective Agreement.
How could Mr. Cooper expect the Forms to be
Nothing that
C. Form 220 and semi-annual inspections
Among the duties of a District Inspector is the
semi-annual inspection
of licensed establishments and the
report on this inspection. Since June 1976, this report has
been made on a Form 220 (various dates were given for the
introduction of this form - I accept Mr. Cooper's date given
in his cross-examination).
Form 220 is a multi-purpose form., which is in-
tended to be used for many reporting purposes. Mr. Knudson
was discharged in part because he submitted fifteen semi-
annual Form 220's signed by someone other than the person it
was purported to be.
For a semi-annual inspection, the inspector fills
up spaces at the top of the Form with, inter alia, informa-
tion on the establishment and its licence number and the
name of the proprietor or manager. There are then 20 line
entries opposite which the inspector ticks "Acceptable" or
"Unacceptable" (these are the two columns on the far right
of the 20 line entries). These line entries cover wash-
rooms, licensed rooms, etc. There is room on the Form for a
notice to a proprietor and for comments on "unacceptable
areas".
one
for the inspector's signature, and a second for the
Pr opr i et or /Man ag e r .
At the bottom of the Form, there are two boxes -
With respect to clubs, taverns and restaurants, an
inspector has few powers other than inspection. Matters of
fire, health and safety are under the jurisdiction of other
authorities.
All
of the Form 220's in issue here involve semi-
annual inspections of clubs, taverns, or restaurants where
no deficiencies are indicated. That is, the establishment
was given a "clean bill
of health" by Mr. Knudson.
The real problem is that the signature in the box
for ''Proprietor/Manager" is not the signature of the person
who signed the form, nor is it a signature done with the
authority of the person whose name was signed, and in several
cases, it is the signature of a non-existent person. These
21
facts were proven at trial and I accept that proof. The
Crown called evidence to show that the name in the signature
box was not signed by the person whose name it is, nor was
authority given to anyone to sign that name, and in the
several cases abovementioned, the name was that
of a non-
existent person. In all these cases, the signed name cor-
responded with the name at the top of the Form.
Now before I continue, it must be made clear that
we heard much evidence concerning whether it was the prac-
tice or policy to ensure that the proprietor or manager
himself sign in the box. Mr. Riggs, in his very well rea-
soned argument, acknowledged that the practice or policy is
not the issue. Rather, here the issue is whether or not
. Mr. Knudson breached his duty of fidelity to the LLBO in .
submitting forms so signed. I agree entirely with Mr.
Riggs. Indeed, were it necessary to do
so, I would be pre-
pared to find on the basis of all the evidence before us
that it was not essential that the Form be signed by the
actual proprietor or manager, but could be signed by any
"person in charge"
as manager pro tem.
Mr. Knudson has no satisfactory explanation for
these signatures.
While
I am not bound by the finding of fact at
trial, I think it is useful to consider the decision of His
Honor Judge Smith (at pages 11-16):
"When it comes to semi-annuals, we are
dealing with counts 1 to 16 inclusive with the
exception of count 15 which is being dismissed for
lack of evidence. In order to find the accused
guilty upon any of those counts, the Crown must
have satisfied me beyond a reasonable doubt,
amongst other matters which are not really in
issue, either that the accused did not visit the
establishments for which there are semi-annual
reports filed and the only counts upon which there
is positive evidence that this may be so, as
agreed by the Crown, are counts
3, 10, 11 and 16.
Or the Crown must have satisfied me that a ficti-
tuous person signed such reports to the knowledge
of the accused or, thirdly, that unauthorized
persons did; the latter two eventualities require
a finding, on the part of this Court, that such
signature was material.
I must also be satisfied that the documents
in question in the latter two prongs of the three-
pronged situation that I have just now described,
which is envisaged in the counts relating to semi-
annuals, come within the (a) (i)
or the (a) (i) (i)
portion of the definition of a false document
defined in Section 282.
I will consider first the materiality of the
signature. The form itself provides
for the
signature of the proprietor or manager.
visor Steele told us that the Board directed that
there be such a signature. He knew of no cir-
cumstance where the requirement could be ignored
other than the proprietor's refusal to sign.
signature provided, he said, an acknowledgement
that the inspection had been done.
All Ottawa
inspectors were notified of this, although not in
writing, at the January, 1976 seminar when the
form -- that new form, was introduced.
cedure manual made available to all inspectors
emphasized the need for execution on behalf
of the
establishment.
the Board and by the supervisor.
told us that he received as many as two thou-
sand- -- fifteen hundred to two thousand semi-
annual forms from the Ottawa area alone and he
would very occasionally receive one without a
signature. He would then contact the inspector,
although he admitted that it was conceivable that
he would take no action, particularly when there
was a refusal to sign.
Super-
The
The pro-
This form also was monitored by
The supervisor
Mr. Malkiewich, called by the accused, whose
evidence must be characterized
I say in passing,
as something less than truthful or reliable,
23
coming as it did from one who appeared at least as
interested in fighting a battle on behalf of one
of his "guys" as he was in giving a reasonably
objective account of events and facts within his
knowledge. Well even such a witness agreed that a
signature was required. He did say, to be fair,
that any signature would do, although he did not
go so far as to refer to the dishwasher, for in-
stance, in the establishment.
As against this, the accused claims that
fellow inspectors never bothered to have the semi-
annuals signed. The signature, he said, was unim-
portant. He would not go out of his way to get
them signed. The signature was secondary, yet a
signature was obtained in all cases covered by the
fifteen counts in the Indictment dealing with the
semi-annual reports.
There is no alternative open to me, on the
evidence, but to find that the signature was
indeed a material part of this form. The name of
the owner, or manager, at the top of the document
was certainly material, in my view, as was the
signature at the bottom. The signature being
material, I will confine my consideration to the
various counts,
1 to 16, with the exception of
count 15, to the question of whether they were
genuine within the meaning of Section 282(a).
Keeping in mind the heavy onus of proof in a
criminal case, I am not prepared to find that the
accused did not visit the premises described in
counts 3, 10, 11 and 16, although the evidence'
could be said to raise suspicions, perhaps even
strong suspicions.
I find, however, that Eva Hikl, did not sign
any of the semi-annuals described in the Indict-
ment, nor did she authorize any other person to do
so. The same may be said of the fictituous name
of Duhamel used in connection with the Carmen's
Beach Tavern. The accused's explanations are
totally unacceptable, particularly as they deal
with the name Duhamel, erroneously used on three
of the forms.
Now these comments are directed to counts
I,
2, 3, 4, 5 and 6. I have singled those esta-
blishments out because, on the evidence and given
the nature of the establishments, the lack of
signature of the owner,
or manager, or of any
authorized person, are more apparent perhaps or
more certain.. However, I am satisfied beyond a
reasonable doubt that the signature was neither
genuine nor authorized on any of the forms in-
24
volving the Semaphore, in counts 7 and 8; the Far
East Tavern in count 9; the Chef Pierre in counts
10 and 11; the St. Charles Social Club in counts
12 and 13; Chances "R" in count 14; and finally,
the Steak N' Burger in count 16.
I cannot unfortunately place any reliance'
upon the accused's diary or daily sheets or even
the master sheets, which may well be a recon-
struction, perhaps months perhaps years after the
event, nor were the rationalizations, exagger-
ations and constant irrelevant discourses on the
volume of work, or the general evasiveness of the
accused, were very successful in inspiring con-
fidence in the acceptability of the accused's
testimony.
The proprietors and managers were clear,
forthright and direct and free of interest in the
outcome of these proceedings.
It seems to me to follow that there must be a
conviction upon all counts 1 to 14 inclusive and,
of course, upon count 16. I found that there is
no rational conclusion that I can come to other
than that all the elements of these offences given
the laws I have described, have been proven in
accordance with the standard of proof in a criminal
trial. I'
His Honor found "no 'rational conclusion" for the
improper signature on these fifteen Form 220's "other than
that all the elements of these offences ... have been proven".
Mr. Riggs suggested three possible explanations
for these improper signatures:
- all the signers were asked simply to sign the
Form and spontaneously signed someone else's
name and Mr. Knudson was not aware that this
had been done. Mr. Riggs suggests that this
defies common sense.
- Mr. Knudson asked the person present in the
establishment to "Sign the name
of the man-
ager or owner I've put in at the top of the
Form". Mr. Riggs suggests that it is hard to
believe that someone would sign the name of a
non-existent person three times (or that 3
25
people would each sign this non-existent name
independently), or twice sign the Fame of a
manager which has been misspelled by Mr.
Knudson at the top of the form and the signer
repeats the misspelling at the bottom. Even
if this situation is correct, Mr. Knudson
would have deliberately deceived the LLBO as
to who in fact had signed the Form.
- Mr. Knudson, or someone else, with no con-
nection whatsoever with the establishment,
signed the Form. This would clearly be
fraudulent.
I confess that this is the most difficult part of
this entire case. There is no real evidence of who signed
these Forms. Mr. Knudson's records are of no assistance
whatsoever. We are left to surmise, based on rational
possibilities..
1.
2.
In my view, there are several considerations:
Why would Mr. Knudson submit these Forms
knowingly? It could be that he never visited
the establishments at all for a semi-annual
inspection. Or, it could
be that he left the
establishment having forgotten to get the
signature and fitted one in to avoid the
waste of time in going back. I am satisfied
that Mr. Knudson did make the inspections. I
am also satisfied from his testimony that he
did not sign the Forms himself but had some-
one in the establishment sign in the box for
"Proprietor/Manager"
.
Mr. Knudson did some 600 semi-annual in-
spections during his employment. The evi-
dence is clear that a semi-annual inspection
of a small club, tavern or restaurant was a
quick, routine affair, and that the closing
signatures were treated as a matter of for-
mality, even if material. The inspector
simply hands the form to the "person in
charge" and says something like "Here's a
good report, please sign it". After an
intensive investigation, only fifteen Form
220's were found to be signed improperly. If
Mr. Knudson was a dishonest man, wouldn't
there be a pattern of such falsehood? We are
talking here of problems with less than 3% of
the semi-annual reports submitted by Mr.
Knudson.
26
3.
The establishments concerned were small oper- ations. The "person in charge", when Mr.
Knudson arrived for the inspection, could be
a janitor or dishwasher. It could be someone
with. limited education and no real knowledge
of the exact name of the manager or its
spelling. It could be someone who thought the
Form should have the name of the manager in
the box to acknowledge that Mr. Knudson had
visited and left a copy.
Now, I think that the situation last described is
unlikely.
centage. Is it really that unlikely that 3% of the semi-
annual reports were signed as described in the last situ-
But 3% of the Form 220's is a very small per-
ation? In my view, it is not at all unlikely.
That Mr. Knudson would not notice that the signa-
ture was not that
of the person it was purported to be is
not surprising. I have already said that I think he is
quite a disorganized man.
Let us consider this matter further by looking at
the three Form 220's which concern Carmen's Beach Tavern and
were the subject of three criminal charges on which Mr.
Knudson was convicted. On February 7, 1977, October 20,
1977 and April 14, 1978, Mr. Knudson submitted semi-annual
reports on this establishment. The manager's name in the
top right-hand corner was recorded as "R. Duhamel". The
signature reflected this. There is no such person. The
manager of this establishment was Roger Dahan. At the
trial, Mr. Dahan testified that he had seen Mr. Knudson two
or three times in the restaurant (from the transcript, at
27
page 133).
not given to inspectors by the Board.
learned them on the job. It is highly probable that a man
like Mr. Knudson, meeting Mr. Dahan so rarely, could think
his name was Duhamel. At trial, Mr. Knudson referred to Mr.
Dahan repeatedly as "Roger" (in the transcript, at page 408,
line 19; page 409, lines 17 and 20), he said he knew the man
only as "Roger" (at page
410, line 17) and surmised it was
The names of the managers in establishments were
The inspectors
"Roger Duhamel".
relations man, a quite disorganized liquor inspector, dealing
with someone in a tavern only on a first-name basis
very Likely situation.
manager's name, this man writes it down as "Duhamel", be-
For a former liquor salesman, a public
is a
And with
no direction concerning the
cause that's what he thinks it is. Then, three or two
short-term employees, who happen to be in when Mr. Xnudson
makes one of his rare visits to the place, sign R.
Duhamel" in the box to acknowledge he was there and to
accept a copy of the Form. It would be obvious the Form was
a good report and it could well be taken that the same name
should be in the place for signature.
likely that a small proportion of people with little educa-
tion and no instruction on signing such forms would think
I think it quite
that to acknowledge the receipt of the form one puts in the
manager's name.
when one considers that there is just no adequate reason for
Mr. Knudson to forge the name himself.
This explanation is all the more likely
When a semi-annual inspection was done, one copy
of the completed Form 220 was left with the establishment.
28
Why did no one at Carmen's Beach Tavern phone up to say that
Mr. Knudson had put down the manager's name improperly? Or
why did the other owners and proprietors not phone up to say
they hadn't authorized the signatures? Either because no
copy was left on these occasions,
or because no attention
was paid to the entries concerning the manager's name by the
people in the place. In either case, the repeated error at
Carmen's Beach Tavern is explained.
I have reviewed with
great care the evidence of the various proprietors and
managers called to testify at the trial. None was asked
whether or not he or she received a copy of the relevant
Form 220. No one said it was the first time he or she had
seen the relevant Form 220. There is no indication that it
wasn't left at the establishment. I think it highly likely
that Mr. Knudson did leave these Forms as he was supposed to
and wasn't aware of his errors because no one noticed it or
bothered to call up to tell him of them. Indeed, we find
the following statement:
Mrs. Hikl (at page
119, lines 7-12) :
A. I didn't pay too much attention to any
time any inspector was there. Sometimes I had a
question to ask and if
so I would ask the man,
otherwise I didn't pay too much attention how
often as long as everything was all right and
everything was in working order, that is all I
cared about.
And concerning the attitude of managers to signing Liquor
Board forms, we have:
Mr. Woods, division manager of Winkie's Steak
and Burger (at page 143, lines 20-28) :
Q. This particular document that I am
showing to you, Exhibit 10, the semi-annual report
dated April 20th, 1978. Have you seen documents
similar to it?
29
A. Yes.
Q. Have you signed documents similar to it?
A. Yes.
Q. What would that be in connection with?
A. Well if I am on the location and the
liquor inspector comes in, and I know about it, I
go and talk to him and sign anything for him.
. (emphasis added)
In
sum, no one can be sure how these signatures
In my view, it is just as likely that the ex- were done.
planation is innocent as it is likely it was fraudulent. Mr.
Knudson is not an organized man. It is highly probable that
he was not at all careful in the matter of the signature in
the "Proprietor/Manager" box because so little attention was
paid to the signature until the investigation.' I-conclude
that, on the basis of the whole of the evidence before this
Board
of Arbitration, the improper signatures on the fifteen
Form 220's were the result of lack of care and were not the
result of any criminal act on the part
of Mr. Knudson.
-
Again, I have come to a different conclusion from
His Honor Judge Smith.
and after much consideration. In fairness
to his decision,
I point out that the trial lasted 6 days and the transcript
is 505 pages long. There are some 700 pages of exhibits.
Yet his oral decision was rendered only four days after the
trial concluded.
material at some length and have had the benefit of addi-
tional evidence.
I do so with the greatest respect
I have had the opportunity to consider the
30
CONCLUSION
I find no wrongdoing by Mr. Knudson. At the most,
he was quite careless in respect of fifteen of the 600 semi-
annual inspection reports he filed.
This being the. case, he is not in breach of his
duty of fidelity to the Liquor Licence Board of Ontario and
there is no justification for his discharge.
I am left with the profound feeling that a ter-
rible injustice has been wreaked on this man following an
inflammatory allegation in the media that he accepted bene-
fits.
I can redress only a part of the terrible wrong done
to his career, his personal reputation, and his life. He
may have to look elsewhere for adequate compensation for his
nightmare, if "adequate" compensation is possible.
I order that he be reinstated immediately to his
position as a liquor licence inspector.
Insofar as compensation for wages lost is con-
cerned, there is some question of mitigation
of losses and
the parties have requested this Board of Arbitration to
retain jurisdiction to decide the amount of compensation if
31
the parties are unable to come to a ready agreement on the
matter. We retain jurisdiction for this purpose.
Done at London, Ontario, this
10th day of March, 1981.
M. Perrin, Member, concurs.
B. Lanigan, Member, concurs in the reinstatement but dissents
in part. Her decision will follow.
LIST OF EXHIBITS
Exhibits entered at trial and agreed on as exhibits for this
arbitration -
1.
2. Master file: Czechoslovak (Maxi Plate) Tavern
3.
Notice Under Canada Evidence Act
Master file:
Tavern
Au Pied du Quai Tavern and Carmen's Beach
4. Master file: Semaphore Tavern
5. Master file: Far East Tavern
6. Master file: Chef Pierre Tavern
7. Master file: St. Charles Club
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
Master file: Chances "R" Restaurant
Master file:
Master file: Steak "N" Burger Tavern
Master file: Parthenon Steak House
Master file: Four Sisters Restaurant
Knudson's file: Czechoslovak Tavern (Maxi Plate)
Knudson's file: Au Pied du Quai. (Carmen's Beach)
Knudson's file: Semaphore Tavern
Knudson's file: Far East Tavern
Knudson's file: Chef Pierre Tavern
Laurel & Hardy Tavern
18. Knudson's file: St. Charles Club
19. Knudson's file: Chances "R" Tavern
20. Knudson's file: Laurel and Hardy Tavern
21. Knudson's file: Steak "N" Burger Tavern (Winco)
22. Director of Inspections copies of Form 220: Czechoslovak
(Maxi Plate) Tavern
23. Director of Inspections copies of Form 220:
Quai (Carmen's Beach)
Au Pied du
24.
25.
26.
27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
Director of Inspections copies of Form 220:
Tavern
Director of Inspections copies of Form 220:
Tavern
Director of Inspections copies of Form 220:
Pierre Tavern
Director of Inspections copies of Form 220:
Charles Club
Director of Inspections copies of Form 220:
"R" Tavern
Letter dated July 8th, 1974
Director of Inspections copies
of Form 220:
"N" Burger Tavern
33
Semaphore
Far East
Chef
St.
Chances
Steak
L.L.B.O. copies of Inspector's Daily Reports, January
to August, 1978
L.L.B.O. copies of Inspector's Daily Reports, 1977
Knudson's copies of Inspector's Daily Reports, January
to August, 1978
Order-in-Council of Mr. Knudson's appointment as an
inspector with the L.L.B.O.
Mr. Knudson's diary for the year 1978
Personnel file
of Liquor Licence Board of Ontario
re: Knudson
Memorandum No. S-110 dated December 10, 1973 respecting
acceptance
of benefits
Memorandum No. S.110, Acknowledgement, dated May 6th,
1975
Licenced premises under Mr. Knudson's supervision
Handwriting analysis report, dated August 9th, 1979
Flow Chart for Form 220
Flow Chart for daily inspector's report
Mr. Knudson's file - assorted 220 forms
Blank Form 220
Blank Inspector's Daily Report
46.
47.
48.
49.
50.
51.
52.
53.
54.
55.
56.
57.
58.
59.
60.
61.
62.
63.
List of Admissions
Part of procedural manual.
Hospitality guidelines
Memo from Mr. R.G. Lamb dated December 12th, 1978
List of Admissions, No. 2, under Section 582 of the
Criminal Code
(Two pages)
Position description for a district inspector
Memorandum dated June 12th, 1976 entitled: Re: Items and information required to be available
Personal Attendance Register, Form No. 164
1976 diary of Mr. Knudson
1977 diary of Mr. Knudson
Master personal work sheet
Letter dated January 16th, 1978. (Two pages)
Establishment Book e
Letter dated September 16th, 1976 re training seminar
-
Inspectors Daily Report, July 10th to 14th, 1978
Monthly report in blank form
Blue binder. (Formerly Exhibit
"B")
Diary diary and sample diary page. (Formerly Exhibit "B")
Note: Exhibits 54 and 55 were retained by the Ontario
Provincial Police and not turned over to this Board of
Arbitration.
Exhibits entered at the arbitration hearing -
64. Transcript in 6 volumes
65. Award of Eberts
et al. concerning the suspension without
' pay, G.S.B. 277/79
66. Two memoranda from P.G. Boukouris, June 28, 1979
67. Letter of discharge, May 20, 1980
35
68. Form 113, L.L.B.O. Inspector's Semi-Annual Report
69. Memorandum re diaries, November 7, 1979
70. Form 163, from Mr. Knudson's file
71. File folder containing all of Mr. Knudson's personal
Form 163's which have reference to his supervisors