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HomeMy WebLinkAbout1985-0772.O'Connell.87-02-20IN THE MATTER OF AN ARBITRATION . Under Between: Before: ING ACT THE CROWN EMPLOYEES COLLECTIVE BARGA ,IN For the Grievor: i,. For the Employer: Before Hearing: THE GRIEVANCE SETTLEMENT BOARD OPSEU (Neil O'Connell) Grievor - and - The Crown in right of Ontario (Ministry of Industry and Trade) Employer M.K. Saltman Vice-Chairman I.J.~Thomson Member W.A. Lobraico Member B.A. Hanson Cavalluzzo, Hayes & Lennon Barristers & Solicitors S.A. Currie Staff Relations Officer Human Resources Secretariat Management Board of Cabinet December 16, 1986 INTERIM DECISION The Grievor in this case, Neil O'Connell, claims that he was improperly denied a vacancy in the position of Technical Consultant in the Loan Administration Branch of the Ontario Development Corporation ("the Corporation"), which reports to the Minister of Industry and Trade. A hearing in th'is matter was held in Toronto~ an December 16,.1986. The successful applicant, David Smith, was given notice and advised,,of his right to participate in the hearing. Apart from the notice given,to him as the successful applicant, Mr.. Smith was served with a subpoena duces tecum requiring him to attend the h~earing and to bring with him "all case files for which you were ..responsible ,for the period January, 1983 - July; 1985". of On December 12, 1986, the Corporat ion notified the Union i ts objection to the admissibility of the documents requested in the subpoena served on Mr. Smith and of certain other documents requested~ by~the Grievor in the course of preparing his case. At the hearing; the Corporation objected not only to the admissibility, but to the production, of all of the Notwithstanding its object i on, the Corporation offered to documents requested. .~ allow both the Grievor and the incumbent to give oral evidence as to :. 3 the contents of the documents and also to use the documents to refresh their memories (although not to refresh memory in the legal sense as this would give the Union the right to inspect the documents on the gr,ounds that they had been iltilized for the purpose .~ of refreshing memory). .The Corporation also offered to provide a summary of the Staff Locations Register relating to the whereabouts of the incumbent on each and.every workday during the relevant period. Th.e Union accepted the offer of a summary of the Staff -~ Locations Register, which the Board ordered provided forthwith,~ but refused the Corporation's offer to allow the witnesse.s to testify as to contents of the documents in question. Union counsel maintained that he required production of the documents in order to prepare his case and advised the Board that he mightwish 'to adduce the documents as evidence in the course of the hearing. At this juncture, it should be stated that there was no dispute as to the Board's jurisdiction to.order production. The dispute centered around whether the documents requested ought to be produced. Moreover, there wasno attempt to distinguish. between the documents requested in the subpoena duces tecum and, the documents- requested by the.Grievor in the preparation-of his case. It was generally understood, if the Board.ordered production.of the documents requested, that all of the documents (including those referred to in the subpoena &&es tecum) 'would be made available prior to,,the hearing. .: 4 The Corporation objected both to production of the documents and to their admissibility on the grounds (1) that they were confidential and (2) that they were irrelevant. Although, strictly speaking, production and admissibility are separate matters, the case was argued as if the two issues were the same. At this stage in the proceedings, .where no e.vidence has been heard 'on the merits, it is still possible to determine the Corporation's objection to production of the documents on the grounds-of both relevance and confidentiality. However, it is possible .only to determine the objection as to admissibility on the grounds of confidentiality. l'he objection to admissibility on the grounds of relevance can only be determined during the cotirse of the hearing on the merits and in the event that the documents are actually tendered in evidence. ..~ In order to assess its objection, the.Corporation introduced evidence as to the operation of the Loan Administration Branch ("the Branch"). According to the evidence, it is the func- tion of the Branch to administer loan agreements that have been entered into between the Corporation and its corporate borrowers. The borrowers are generally small businesses which have not been able to obtain funds from other sources. In addition to providing ,funds, the Branch also provides assistance to companies that are experiencing difficulty in managing thei.r businesses. . 5 The subpoena requests the production, of "case files" for which the incumbent was responsible during the period January, 1983 to July, 1985. Notwithstanding the scope of the subpoena, counsel advised the Board that the Union requires only a sampling of these files and, in particular, examples of technical consultant reports which the incumbent had prepared. According to the evidence, an entire case file might include the borrower's application for funds from the Corporation; documen~tation in support of the application, such as cash flow.statements; and correspondence relating to the : disbursement of funds and the administration of fundswhich have I been disbursed, as well as consultant reports. In general, terms, these:~reports~ relate to borrowers that~ are experiencing difficulty in managing their businesses and contain a thorough analysis of the problems encountered. In addition to the documents requested under the authority of the silbpoena duces tecum, by memorandum dated September 25, 1986, the Grievor requested access to "certain letters, documents, files and other such information as may be required". It would appear from the Employer's notation on the memorandum that the Grievor was requesting access to three specific files. ,On December 16, 1986, a similar request was made in relation to seven other files. Initially, it appears that the Grievor's superiors.granted him per- mission to use and even to.photocopy.any of the documents requested in the preparation of hi-s case although, because of the . 6 "confidential" nature of the documents, he was denied permission to introduce them in evidence. Subsequently, however, the decision was reversed and permission was withdrawn. With respect to the claim of confidentiality, the Corporation submitted that disclosure of the information contained in the documents could have an adverse effect if, for instance, it became known to other creditors that the borrower was in a weak financial position or if competitors gained access to financial information about the borrower (which the Corporation conceded was unlikely in the circumstances). In order to avoid such difficulties, it is the policy of the Corporation not to disclose. information about its borrowers without the borrowers' written per- mission. Rowever, in accordance with its statutory responsibility, the Corporation is required to make a report to the Legislature, indicating the name of the borrower, the date of the loan and the amount and terms of the loan, including the interest rate ('Development Corporations Act, R.S.O. 1980~, c. 117, S. 25). ,In an attempt to address the Corporation's concerns, the Union offered to accept an expunged version~of the documents which deletes the names of might serve to ident i offer. Accordingly, de~term ,ination. the borrowers and any other information which fy them. The Corporation refused the Union's '~' the matter was referred for the Board's 7 The issue to be determined is twofold: (1) whether to order production of the documents requested: and (2) whether the documents are admissible in evidence. There was no dispute as to the Board's jurisdiction to compel the production of documents which may be relevant to the case at hand: see Re Canada Post Corporationand Canadian Union of Postal Workers: Grievance of Fields, August 9, 1985.(Weatherill (unreported) I. At this stage in the proceedings, the matter of relevance must be viewed.liberally. ,This was the op~inion of the Board of Arbitration in the case of Re Mount St. Joseph Hospital and Hospital Employees' Union, Local 180 (19851, 19 L.A;C.(3d)107 (Thompson) (the "Mount St.. Joseph" case): 11 Finally, at this stage of the proceedings, relevance must be viewed liberally. It is possible that the document will not be -_-.. relevant. Ultimately, this board may have to make that determination. But without~'seeing the report, counsel for the union cannot. decide if he even wishes to use it. As arbitrator McCall stated in Re Pacific Press Ltd.~and Vancouver-New Westminster Newspaper Guild, Local 115 (19.821, 7 L.A.C.(3d)316 (Somjen),. [application for judicial review dismissed, 83 C.L.L.C. para. 16,0181 ate P* 337: ,. I . . . the purpose of the production of the documents is n'ot at 'the preliminary stage to establish the relevancy but merely to establish the.right to documents which may subsequently prove to be relevant in th.e proceedings.' Later he describes his task as follows, ibid., at pp.~, 337-8: 8 'The question that I must ask myself with respect to each document.sought is whether or not it is likely to be relevant to the issue at hand.'" Similar views were expressed in the case of Re Westar Mining Ltd. and United Mine Workers, Local 7292 (1987), 25 L.A.C.(3d)136 (Fraser) (the "Westar" case) and in the case of Re - Toronto Star and Southern Ontario Newspaper Guild (19841, 11 L.A.C.(3d)249 (Swan). In the Westar case, the Arbitrator expressed his views at p. 144 as follows: 11 . . . . . In my view, any doubt about the relevance of the documenfs.should, at this stage, be resolved in favour of their produc- tion. I accept that the documents may be relevant to the preparation and presentation of the union's defence to the claim made by the company. That is not to say that I am persuaded that the documents are relevant.. I 1~, do notconsider, however, that I must be so persuaded in order to require the~ir disclosure and production in advance of the hearing. Of course, the ultimate decision about their relevance~and probative value as part of the test of their admissibility will take place, if they are tendered, at the hearing." In the instant case, the Union asked for produc.tion of certain files~ worked on by the incumbent in his capac-ity as Technical Consultant from January, 1983 to July, 1985 and of documents named in the memoranda of September 25 and December 16, 1986 utilized by the.incumbent and/or the Grievor in his present position. As already noted, the Union requires~only a sampling of 9 the case files requested. At this stage in the proceedings, it is impossible to know what value, if any, these documents might have. However; in our view, those documents which predate the competition appear to be sufficiently relevant to ~the issue at hand, which is the Grievor's entitlement to the job of Technical Consultant, to require their production. The subpoena also covers a two-month period beyond the date of the competition. In contrast to the documents relating to the earlier period, it has not been proven that these documents are sufficiently relevant to the issue at hand. In any event, the Corporation maintained that the documents requested ought not to be produced or admitted in evidence because they were confidential. Both parties appeared to agree that confidentiality could be the basis.for a claim of privilege 'if the conditions (commonly referred to as the "Wigmore Conditions") referred to by the Supreme Court of Canada in the case of Slavutych v. Bakeret al. (19751, 55 D.L.R.(3d)224 were met: "(1) The. communication must originate in a .. confidence that they.will not be disclosed. (2) The element of confidentiality must be essential to the full and satisfactory ~main- tenance of the relation between the parties. (3) This relation must be one which in the opinion of the community ought to be sedul- ously fostered. (4) 'The injury that would inure to the relation by the disclosure of the communic- ations must be greater than the benefit thereby gained for the correct disposal of litigation." 10 All four conditions must be met in order to preserve the confidentiality of the documents involved. With respect to the first three conditions, the Corporation argued that as a lending institution, it is required to protect the confidentiality of its corporate borrowers. Further- more, the Corporation argued that the relationship to its borrowers is unique because of its propensity to deal with borrowers in weak - financial circumstances. Accordingly, in relation to the fourth condition, were it to become known that a company was in debt to the Corporation, its weaknesses might be, revealed. In.the Board's view, this argument ignores the fact that the identity of the borrowers is a matter of public record because of the statutory requirement to report to the Legislature on loans made.by the Corporation. In any event, the Union is prepared to accept the documents with the identity of the.borrowers, as well as any other "confidential" information, deleted. In these circumstances, it is difficult to imagine what harm could inure to the relationship between the Corporation and its borrowers from disclosure of the information requested. There was some suggestion that borrowers might be dissuaded from even entering. were it to become known that might be revealed in proceedi into a transadtion with the Corporation documents relat.ing to the transaction ngs such as these. In the Board's view, in light of the Corporation's role as a this scenario seems highly unlik.ely. lender of last resort, 11 Finally, the fourth condition requires a balancing of interests. The Grievor and his counsel require access to this information in order to prepare his case. It is reasonable to conclude that without such information, the Grievor might be denied' a 'proper adjudication of h,is claim. In view of the vital interest of the Grievor to have his claim adjudicated upon as well as the safeguards available to protect the interests advanced by then CorlYoration, the Board is of the view that the benefits of disclosure of the documents outweigh the potential injury, if any, which might inures to the interests of the Corporation and its borrowers. This is not to.,say that the Corporation does not have a legitimate interest in protecting the confidentiality of its corporate borrowers, but only that the identity of the borrowers is already a matter of public record and that any other information which might compromise the borrowers' legitimate interests can be shielded from disclosure. In these circumstances, the Board must find'that the four Wigmore Conditions,h~ave not been met and, therefore, that the documents are not inadmissible on the grounds of confidentiality. (As the evidence unfolds, of course, there may be other bases for finding that the documents are,inadmissible.) The Board is not satisfied th~at the Wigmore. Conditions should be extended to the issue of conf identiality as it relates to the production (as opposed to the admissibility) of documents (even 12 though this was done in the Mount St. Joseph case). We note, however, at least for the purposes of this case, that similar issues are raised with respect to production of the documents requested and their admissibility in evidence. Furthermore, it would be unrealistic to refuse to order the production of documents on the grounds~of confidentiality while dismissing an objection to their admissibility on the same basis. For this reason and in view of the tacit agreement of the parties that the issues of production and, admissibility be dealt with together, the Board orders production of the documents requested, with one exception. As indicated at page 9, at this point. it has not been ~established that the documents requested for the period subs.equent'to the competition are Sufficiently relevant to order that they be produced. Accordingly, the Board amends the subpoena duces tecum to cover case files for the period January 1, 1983 to the date of the competition, which was .,. some time in May, 1985. The order for production will be subjec~t to the following conditions: (1) as agreed by the Union, the Corporationwill have the right to~delete information from the documents which could reasonably identify the borrower or any of its corporate secrets. 'Ihe matter may be remitted to.the Board if there is any dispute as to the extent of these deletions; and 13 (2) in order to reduce the potential for harm even fur- ther, the Board directs that access to the documents be restricted to the Grievor and his counsel or members of-.~his law firm. The Board will remain seized in the event that difficulties.arise in the application of this award. The Board continues to be se i zed of the merits of the grievance, which is 'scheduled for hear i ng on March 6, ,1987. DAT.ED AT TORONTO, this 20thday of February, 1987. Membei / ,i <-,