HomeMy WebLinkAbout1985-0773.Cahoon.90-04-26IN THE MATTER OF AN ARBITRATION
Under
THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT
THE GRIEVANCE SETTLEMENT BOARD
Between: OPSEU (Barry Cahoon)
and
The Crown in Rights of Ontario
(Ontario Development, Corporation )
Before: R. L. Verity, Q.C. Vice Chairman
J. McManus Member
iJ.A. Lobraico Member
:. \
:
For the Griever:
For the'Employer:
Hearings:
G.' Paliare
Counsel
Gowling and Henderson
Barristers and Solicitors
J. Zarudny
Counsel
Crdwn Law Office Civil
Ministry of the,Attorney General
January 23, 1986
May 21, 1986
tune 24, 25, 26, 1986
October 8, 14, 1986
November 18, 1986
April 2, 7, 1987
May 6, 1987
Griever
Employer
i
DECIS-ION
James Barry Cahoon was a Consultant employed by the Ontario
Development Corporation (O.D.C.) at its Mississauga office. He has
accumulated seniority from January, 1981. O.D.C. is an Ontario Crown
Corporation, pursuant to the Development Corporation Act, 1980,.
R.S.O. c. 117, to encourage and assist in the development and
diversification of industry in On,tario, including the provis,ion of
inancial assistance by way of loans. Briefly stated, Cahoon's job
involved assessing and processing, where applicable, private sector
business loan applications according to established criteria.
On January 11, 1985, the then Deputy Ministry of Industry
and Trade suspended Cahoon with pay pursuant to s. 22(l) of the P~ublic
~Service Act, pending investigation of his conduct. S~ubsequently, on
February 7, 1985, Cahoon was suspended without pay (salary withheld
pending investigation) under the same statutory provision. The second
.xspension letter read as follows:
"I refer to my letter to you of 11 January, 1985,
wherein you were suspended from employment at /~
Ontario Development Corporation pending an
investigation of your conduct.
An additional period of time is required to
complete the. investigation of your conduct.
Accordingly, pursuant to subsection 22(l) of the
Public Service Act, R.S.O. 1980, c. 418, your
suspension from employment at Ontario Development
Corporation is continued.
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( Yours salary will be withheld effective as of 7
February, 1985.”
Cahoon filed a grievance in connection with the latter
suspension whereby he claimed that he had. been suspended "without pay
without just cause".
Initially, the arbitration dealt solely with the merits of
the suspension grievance. However on June 20, 1986, the Griever's
employment was terminated by the Deputy Minister of Industry, Trade
,hd Technology.~ The termination letter read as follows:
"Dear Mr. Cahoon:
We have investigated, and are continuing to
investigate, your conduct as an employee at
Ontario Development Corpor'ation.
The evidence which has been obtained
indicates'that you have misconducted yourself as
an employee of Ontario Development Cororatidn with
respect to two separate incidents.
First, during the period August - November,
( 1984, you abused. your position as a loan
consultant by obtaining, and attempting to'obtain,
bacteria, micro-organisms and other substances,
for your own personal use. By so misconductin,g
yourself, you seriously violated and prejudiced
the trust of your employer and its client, I.C.M.
Science, Inc.
Secondly, during the period February - :
August, 1985 you participated in a fraudulent
scheme with Richard Pintar whereby a loan in the
amount of $lS,OOO.OO was obtained~from Ontario
Development Corporation for Plumtree Furs. The
proceeds of this loan were directed to another
business owned (in part) and operated by yourself.
You have continuously refused to confirm or
deny to your employer your participation in either
of these incidents. This has caused your employer
to incur considerable additional expense and
effort to investigate your conduct.
Accordingly; I hereby dismiss you from
employment at Ontario Development Corporation.
You are also hereby advised that you have the
right to grieve this dismissal pursuant to the
.provisions of subsection 18(2) off the Crown
Employees.Collective Bargaining Act.
Yours sincerely,
Patrick J:Lavelle"
On June 24, 1986, Cahoon formally grieved the dismissal and
waived all preliminary grievance procedures in order to.hring the
matter directly to the Board. The Parties agreed. that the present
panel would hear and determine the merits of both grievances. The
Bearing consumed 11 days during which the Employer called 10
witnesses. In fact, the Employer's opening statement took almost one
full day. At the conclusion of the Employer's case, Counsel for the
Union moved for a non-suit and advised the Board that it intended to
: ,311 no evidence when put to its election. The matter then concluded
by way of extensive submissions.
Clearly, there are two separate allegations of misconduct
against the Grievor, both of which relate to abuse of the position of
Consultant and fraudulent conduct against the Employer. The facts
surrounding both incidents and the Employer's response to those facts
are indeed bizarre.
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Briefly, the two separate allegations of misconduct were as
follows:
(1) Cahoon and one Kevin Thomas Birch were arrested by
F.B.I. agents at the Federal Express Office in the Buffalo suburb of
Cheektowaga, New York on Wednesday, November 21, 1984 in possession of
a false package of, tetanus and botulism bacteria cultures. Both men
'were charged under U.S. law with'the offence of fraud by wire and
conspiracy to commit fraud by wire. The charges alleged that the
J-SCCUSed had defrauded or attempted to defraud American Type Cultu,re
Collection (A.T.C.C.) of Rockville, Maryland by falsely representing
themselves as acting on behalf of an Ontario business known as
"1.C.M. Science" of Mississauga, Ontario. .A.T.C.C. is a scientific
foundation engaged in the distribution of micro-organisms for
scientific research purposes. under U.S..law, only legitimate
scientific organizations are permitted to purchase the cultures.
The Employer's theory was consistent throughout; namely,
f hat Cahoon used information provided by I.C.M. Science, obtained in
the course of his employment, to falsely represent himself as an
officer of I.C.M. to obtain bacteria cultures from A.T.C.C. Birch and
Cahoon operated a standard-bred race horse business known as "Four
Aces Racing Stable". The business owned a race horse known as
"Winters Image" which was insured for $100,000.00. "Winters Image”.
had a successful racing career until it injured a leg in the spring of
1984. The Employer maintained that Birch and Cahoon conspired to
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obtain the botulism cultures to kill the horse in order to obtain the
proceeds of the insurance policy.
Initially, at the time of the Grievor's arrest, the F.B.I.
suspected terrorism as the motive. However, subsequent investigation
convinced U.S. authorities that the motive was personal gain. The
arrest attracted wide-spread media attention in Canada. In
particular, news coverage:identified the Grievor as a fiscal
consultant employed by the Ontario Development Corporation.
(2,) In November, 1985, the Grievor was jointly charged,
together with business associates Bruce Kane and Richard Pintar with.
fraud over $200.00 contrary to s. 338(l) of the Criminal Code of
Canada. Although already under suspension pending investigation for
the alleged botulism fraud, the Grievor Las again 'suspended by the
Deputy Minister on December 19, 1985 under s. 22(l) of the.Public
Service Act pending investigation. As'the suspension letter stated,
"we are now also investigating your conduct as it relates to a loan
; Stained from Ontario Development Corporation by Plumtree Furs". That
suspension was not grieved.
The criminal charges against the co-accused involved the
submission of false ~documentation and information to obtain a
$15,000.00 loan from Ontario Development Corporation under the Help
For Entrepreneurs Loan Program (H.E.L.P.). The program initiated in
June, 1984 was designed to assist small manufacturing operations, but
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\ :lot retail operations.
At the Hearing, evidence established that Pintar applied for
and obtained a $15,000.00 loan from O.D.C. by falsely submitting
documentation to demonstrate that the proceeds of the'loan would be
used for an exotic animal rug manufacturing operation known as
Plumtree Furs (a business operated by Pintar). The evidence of Pintar
and of Corporal Ralph Paul established that the $15,000.00 was
improperly diverted to "613170 Ontario Inc. operating as National
quarium" to enable Pintar to purchase a l/3 interest in a tropical
fish retail business. The evidence of Pintar and Corporal Paul also
established that the GKieVOK initiated the fraudulent operation,
informed Pintar of the availability of the H.E.L.P. program, advised
Pintar in all procedural matters required to obtain 'the loan, and
prepared a business plan for submission to O.D.C., all .the while
knowing that the application misrepresented the true purpose of the
_ loan. In sum, the evidence at the hearing clearly established that
the Grievor orchestrated the fraudulent operation to etiable Pintar to
, .cquire $lS,OOO.OO of a $20,000.00 l/3 interest in National.Aquarium.
By August of 1985, Pintar withdrew from the partnership and
'voluntarily advised O.D.C. and the O.P.P. anti-rackets branch of the
sham. Pintar assisted the O.P.P. in their investigation from the
outset and pleaded guilty.to the fraud charge.
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As indicated previously, the Griever’s employment was
terminated on June 20, 1986. Following the dismissal, the Griever
pleaded guilty to .the outstanding criminal charges. On September 15,
1986, the GKieVOK pleaded guilty to fraud by wire inBuffalo, New York
after entering into a plea bargaining arrangement to avoid
imprisonment. On December 1, 1986, the GKieVOK and his co-accused
were fined $1,000.00 and were sentenced to a two year term on
probation. Subsequently, on December 3, 1986 in Hamilton, Ontario,
the Griever pleaded guilty t,o defrauding O.D.C. of $lS,OOO.OO in the
.lUmtKee .Fur.matter.
The Board makes no attempt to repeat the evidence adduced
except in certain salient respects and then only in summary form.
Mitchell Bros, O.,D.C. General Counseland Corporate
Secretary, testified that on November 23, 1984, he was advised of
Cahoon's arrest and the circumstances surrounding the arrest in
Cheektowaga, New York two days earlier. BKOS testified that he was
i ssigned by O.D.C. 's Chief Executive ,Officer to investigate.the facts
and that the normal practice was to call upon the O.P.P. to
investigate. BKOS approached the O.P.P. who~declined because of the
prior involvement of the Peel Regional Police. BKOS promptly
contacted Sergeant Burt Steinhardt of the Peel Regional Police.
Apparently, the Peel Police investigation doncerned a possible
hSUKanCe fraud ins OntaKiO.
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The Grievor was placed on special assignment to O.D.C.'s
Chief Executive Officer, during the week of November 24, with full
pay. In fact, thee GrieVOK was paid ~for time spent in jail in the
U.S. The GKieVOr’S assignment continued. until notified on January 11,
1985 that he was suspended with pay pending an investigation of his
conduct.
I According to Bras' ev,idence, between November 30 and
December 14, 1984, he held discussions with O.D.,C. staff members in
ississauga. From these discussions he learned of'certain irregular
condu'ct on Cahoon's part. For example, he was advised by~staff that
Cahoon had received an "urgent" telephone call on the Micom phone on.
November 21 and had instructed secretary Myrna Morgan not to answer
the phone "0.D.C.". He also learned that Cahoon frequently received
phone calls from a man named "Plaxton". In this time frame, Eros
received copies of long distance phone bills for three telephone Calls
placed from the Mississauga O.D.C. offi ce to A.T.C.C. in Maryland. In
addition, he viewed a cheque signed by Barry Cahoon in payment for
'Iree telephone calls to A.T.C.C. on October 9, 1984.
Similarly, in December, 1984, BKOS initiated a series of
monthly.telephone conversations with Assistant U.S. attorney Joseph
M. GueKKa III. During the initial‘telephone call to Guerra, Bros
learned the nature of the charges against the Grievor and learned of
possible procedural strategies.
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BKOS testified that on December 11, ~1884, he and O.D.C. Loan
Director John Mitchell interviewed one Serge Julien of I.C.M.
Science. Julien advised that he had contacted O.D.C. and had dealt
with a "Jim" Cahoon over the telephone on several occasions in 1984
with regard to an unsuccessful loan application. Julien advised BKOS
that he had supplied Cahoon with a master list of I.C.M. Science
suppliers of bacteria and micro-organisms. Julien also advised that
Cahoon had referred him to the Willowdale O.D.C. Consultant Jim Boyd
in November of 1984. BKOS and Mitchell testified that they reviewed
Jcumentation establishing that "T. Plaxton of 1.C.M. Science" had
ordered tetanus from A.T.C.C. and that I.C.M. Science had no such
employee by the name of T. Plaxton.
Bros requested Mississauga O.D.C. staff to locate any file
pertaining to I.C.M. Science. The search proved unsuccessful. In
examination-in-chief, Bros testified that as of December, 1984, he had
no~direct evidence linking Cahoon to I.C.M. Science or Tom Plaxton or
A.T.C.C.
In JanUaKy of 1985, BKOS received written reports from
O.D.C. staff members Myrna Morgan, Catharine Fielding and 'Vi. B.
Shields. On January 16, 1985, Bros attended in Buffalo, New York and
met with F.B.I. special agent John McGuigan. BKOS received copies'of
the pending criminal complaints and McGuigan's affidavit (Exhibit
'12). BKOS learned that O.D.C. would not acquire further documentary
proof Until either a trial was held OK a.guilty plea was entered. On
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January 22, 1985, Bros spoke with A.T.C.C. in Maryland and ascertained
that calls made from the.0.D.C. Mississauga office were paid for by
Cahoon but were made by a man identifying himself as "Tom Plaxton of
I.C.M. Science".
Bros testified that on February 7 he attended at the Federal
Express Office in Cheektowaga, New York and obtained information which
i
verified the contents of McGuigan's affidavit. He also learned that a
previous tetanus order was picked up in October 1984 by "B. Barnes"
'. .the Grievor's girlfriend). On January 29, Bros learned from Sergeant
Steinhardt that Bell Canada had records establishing that in 1984
numerous calls were placed from the 0.D.C.~ Mississauga office and
billed to the telephone of Brenda Bain.
On March 12 Bros was advised that Mississauga O.D.C.
personnel had discovered a number of business cards in the Grievor's
desk pertaining to "Four Aces Racing Stable" bearing the Grievor's
name and the Mississauga Office O.D.C. telephone number.
Bros testified that on April 26, 1985, he made his third
trip to Buffalo, this time to attend the Grand Jury proceedings. The
Grievor pleaded "not guilty" to the charges but was indicted by the
Grand Jury.
Be1 Canada. Bras wanted to ascertain if there were other.phone calls
In June of 1985~ Bros testified that he met with Ken Hird of
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Placed to A.T.C.C. in Maryland or to then Federal Express office in
Cheektowaga in New York. Bros was advised that such information would
be provided only in response to a subpoena or 'a search warrant.
However, in his testimony, Mr. Hird alleged that he was under the
impression that Bros had received details at about that time in
connection with some 19 relevant telephone calls.
I The thrust of Mr. Bras' testimony was to the effect that
during the summe~r of 1985,~the only evidence lin,king the Grievor to
he botulism fraud was circumstantial in nature. According to Bros,
he stillhoped for a guilty plea to provide O.D.C. with direct
evidence. In fact, O.D.C. acquired no further evidence on the
botulism fraud until a copy of a letter was uncovered, quite by
accident, in December of 1985. On that date, Myrna Morgan'discovered
anunsigned copy of.a.letter sent by Cahoon to Serge Julien. of I.C.M.
Science dated June 2, 1983 (Exhibit 2, Tab 131.
. . . . . . . . . . .
i
Richard Pintar testified that on August 9, 1985, he made an
anonymous telephone call to the Hamilton O.D.C. office indicating that
he was willing to tell O.D.C. Loan Consultant Art Tofano about a fraud
involving an ex-O.D.C. employee.
Bros testified that on August 12 he was advised by Tofano of
the anonymous call and that the Hamilton office "strongly suspected"
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the employee referred to was Barry Cahoon, and that the caller was
Pintar. Eros immediately contacted the anti-rackets branch of the
O.P.P. to investigate. Corporal Ralph Paul was assigned the task.
By September 12 ,.1985, Corporal Paul informed Bros of
relevant details including the results of an interview with Pintar and
the involvement of Cahoon. In sum, by mid-September, 1985, Bros knew _-1
, all the details, dates and banking documentation used to defraud
O.D.C. of $15,000.00. Corporal Paul testified that the three accused
i including the Grievor) were charged in November with fraud under s.
338(l) of the C.C.C. Corporal Paul also testified that Volume 1 of
the Crown's 'brief became ava,ilable in February of 1986 but that it was
not until May of that year when O.D.C. representatives requested and
obtained the Crown brief.
The Union contended, that the Employer failed to establish
just cause for either the suspension or for the discharge, or in the
' alternative the penalty imposed were excessive. Mr. Paliare argued
( hat there were two substantive~issues for determination:
(i) Whether there was any cogent evidence presented~ as to
the reasons for the Grievor's dismissal.
(ii) Whether the Employer delayed so long in investigating
the alleged misconduct that it was precluded from
disciplinary action.
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On the first issue, Mr. Paliare .alleged that failure to call
any cogent evidence regarding the reasons for dismissal justified the
granting of a motion for non-suit. Under the second issue, he
contended that the Employer was precluded from disciplinary action
because of.excessive delay under the principles of condonation, lack
of culminating incident and lack of procedural fairness. The thrust
of the procedural fairness argument was that an Employer must act in a
I reasonably expeditious fashion when disciplining an employee for
perceived,misconduct.
Mr. Zarudny argued.that the Employer had just cause for the
discipline imposed and that the Board must reject the motion for
non-suit. Counsel for the Employer contended that there were- three
issues for determination:
(i) Did the Grievor breach the trust relatibnship in ttio
separate incidents of misconduct?
j (ii) Did the Grievor commit fraud?
(iii) Did the Grievor fail to give an explanation of his
conduct when given an opportunity to do so?
In reply to the motion for non-suit, Mr. Zarudny adopted the
position that the letter of dismissal was relevant in setting out the
grounds for dismissal to enable the employee to repond. He contended
1
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that it was unnecessary to call any witness to establish the reasons
for the termination on the day in question.
Transcripts of the guilty pleas were filed as Exhibits at
the hearing. Mr. Zarudny maintained that the transcripts in a
criminal proceeding were admissible in their entirety and conclusive
in a civil proceeding. For that proposition, he relied upon the
i Decision of Mr. Justice Osler in Demeter v. British Pacific Life
Insurance Co. (1983), 43 O.R. (2d) 33 and the Decision of the Court of
ppeal in the same case reported at (1984), 48 O.R. (2d) 266. Mr.
Paliare argued that the guilty pleas, occurring as they did several
months afterthe dismissal, p layed no part in the decision to dismiss
and should be viewed accordingly. He argued that the effect of a
guilty plea does not constitute an admission of the truth of the
stated facts. In his submission, a guilty plea is an admission of
guilt by an.accused and nothing more. In support, Counsel relied upon
the Ontario Court of Appeal Judgment in Regina v. Berry [1957], O.R.
249, recently confirmed by the same Court in Regina v. Howard in a
udgment delivered by Cory J. ,A. dated June 6, 1986.
Numerous arbitral and judicial authorities were submitted by
both Parties.
The starting. point for an assessment of the Employer's
actions in this case is the suspension imposed on February 7, 1985 in
which pay was withheld pending investigation under. the authority of
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s. 22(l) of the Public Service Act, R.S.O., 1980 c. 418, as amended:
\ "A deputy minister may, pending an investigation,
suspend from employment any public servant in his
ministry for such period as the regulations
prescribe, and during any such period of
suspension may withhold the salary of the public
servant."
Regulation 881 under the Public Service Act, as amended,
, provides in s. 18 as follows:
“s. 18 - (1) Where the deputy minister suspends a
public servant from employment pending an
investigation, the period of suspension shall not
exceed 20 working days.
(2) Notwithstanding subsection (I),
where in the opinion of the deputy minister, an
additional period of time is required to complete
the investigation, the deputy minister may renew
the period of suspension for not more'than 20
working days in each case, for such additional
periods as are considered necessary.'!
There was no dispute that the deputy minister failed to
renew the Grievor's suspension at the end of each 20 day period, and
: ccordingly the Board is concerned with the reasons for the.
~suspension. However, the question arose whether or not the Board had
'jurisdiction to review~the merits of a suspension under si. 22(l) of
the Public Service Act.‘
fin OPSEU (C.M. Brown) and Ministry of Natural Resources,~
706/83, 747/83, Vice-Chairman Roberts commented as follows at p. 8:
(
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"Based upon these submissions, it appears that~ the
Board does not have jurisdiction to review the
merits of a suspension 'pending an investigation'
under section 22.(l) of the Public Service Act.
Even so, however, the mere declaration by or on
behalf of the Deputy Minister' that a suspension is
'pending an investigation' within the meaning of
section 22(l), would be insufficient to oust the
jurisdiction of the Board.~ Under section 19(l) of
the Crown Employees Collective Bargaining Act, the
Grievance Settlement Board has iurisdiction to
determine 'whether a matter is arbitrable'.
Pursuant to th.is jurisdiction, the Board has the
duty, in proper cases, to determine whether a
particular suspension actually was or continued to
be 'pending an investigation' within the meaning
of section 22(l) of the Public Service Act. If,
in such an inquiry, it was found that this was not
the case, then it would seem that. the Board would
have jurisdiction to review the merits of the
claim that the suspension was without just
cause... n
A different approach is taken by~then Acting Chairman
Springate in OPSEU (M. Fish) and Ministry of Colleges and Universities
634/83 at p. 13:
,
"It would appear‘that the purpose of section 22(l)
of the~public Service Act is to allow a deputy
minister. or his desisnate, to immediately remove
an employee from his position pending an -
investigation. Presumably this ,authority is given
to a deputy minister because.in some instances it
is inappropriate to allow an employee to remain,in
his position while allegations against him are :'
being investigated. Section 18(2) of the Crown!
Employees Collective Bargaining Act allows an
employee to challenge a suspension before this
Board.. That section does not exclude suspension
pending an investigation, and accordingly, we see
no reason for assuming that the challenge to a
suspension cannot relate to a suspension pending an investigation, particularly given that such a
suspension may be without pay.
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The assessment of the justness of a suspension of' an employee,pending investigation involves
consideration of a number of factors. One is the
nature of the concerns or allegations that are
being investigated. The greater the-possible
adverse impact on the employer, other employees or
the public of the alleged misconduct of the
employee, the more justified a suspension pending
investigation. Also relevant is how quickly the
investigation is conducted, a suspension that was
initially justified may cease to be so .if the
investigation is not pursued with due diligence
. ..'I
This panel of the Board adopts the Springate rationale in
'ts entirety. 1n the instant grievance, it is fair to say that the
Employer might have acted with greater dispatch~in imposing the
suspension as early as December of 1984. However, it was reasonable
that action was delayed~ due to the inevitable complications arising
from alleged criminal activity in a foreign jurisdiction. On the
evidence, the Board is satisfied that the suspension on February 7,
1985 was justified, at least initially, and was an appropriate
response in light of the information then available to the Employer.
Indeed, it is difficult to argue that .the withholding of pay pending
investigation is not a form of disciplinary action.
In contested dismissals under s. 18(2)(c) of the Crown'
Employees Collective Bargaining Act, the Board has a statutory mandate
under the combined, effect qf S.S. (18)(2)(c) and 19(l) of that Act to
hear and determine, on the evidence adduced, whether or not an
employee "has been...dismissed... from his employment without just
cause".
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To some, it might seem an affrbnt to common sense.to say
that an employee who has committed fraud against his Employer (as
subsequent events have established) has not be~en dismis,sed for just
cause.
\
However, the Board is obligated to .consider, on the basis of
relevant arbitral jurisprudence, whether or not there was just cause
I for dismissal at the time the discipline was imposed; namely, on June
20, 1986.
There was no dispute that the Employer based its actions on
the outcome of criminal proceedings against the Grievor. Clearly, it
did not. In fact, the Employer made no reference to any outstanding
criminal charges in e_ither the February 7, 1985 suspension or in the
discharge letter of June 20, 1986. Simply stated, the Employer did
not take advantage of the option considered by Vice-Chairman Swan in
McCrea and Ministry of Community and Social Services, 50/76, at'pp. 8
and 9:
”
. ..There is, of course, much authority for the
proposition that an offence committed against the
employer or directly related to the employment
relationship will justify disciplinary action,
including suspension until disposition of the .;
charges, although the effect of such a suspension
may in some cases.amount to an election by the
Employer to have its disciplinary action stand or fall on the outcome of the criminal trial...."
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As indicated previously, the Union brought a motion for
non-suit at the conclusion of the Employer's case. From the outset,
Mr. Paliare put the Employer to the strict proof of its case: The
Union alleged that the Employer failed to call 3 cogent evidence as
to the reason for the Grievor's dismissal on June 20, 1986.
In disciplinary matters, the onus rests with the Employer to
establish, upon the balance of probabilities, that it had just cause
+o take the disciplinary,action. The Union's motion was directed to
the sufficiency of .the evidence adduced. Accordingly, the Board is
required to assess the probative sufficiency of the ev~idence and to
decide whether there was enough evidence, if left uncontested, to
satisfy the onus of proof.
The Employer based its case on two separate allegations of
misconduct alleging abuse of position. There was no reference in the
dismissal letter to any outstanding criminal charges.
There can be no doubt that Mr. Zarudny went to great lengths
to prove the two separate allegations against the Grievor of
fraudulent conduct on the various hearing dates. To discharge the
burden of proof in a dismissal case, the Employer is required to
establish why it discharged the Grievor at the relevant time. The
only evidence before the Board as to the reasons for termination was
the dismissal letter of Deputy Minister Patrick Lavelle (Exhibit 3a).
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Neither Mr. Lavelle nor any other witness familiar with the reasons
was called upon to, testify. In our opinion, the failure on the part
of the Employer to call a key witness was a fatal flaw. ,In light of
the excessive delay between the suspension without pay and the
eventual discharge (some 17 months later), the Employer was under an
obligation to call oral testimony from some key witness to explain and
justify,the reasons for dismissal in June of 1986.. Simply stated, the
evidence in the form presented in Exhibit 3a is insufficient to
establish a prima facie case of dismissal for just cause. In our
ginion, Mr. Lavelle's letter in the form presented,'although
admissible, is hearsay evidence which cannot be relied upon
exclusively to establish just cause for the disciplinary action. See
- Re Girvin et al. and .Consumers' Gas CO. (19731, 1 0-R. (2d) 421
.(Ont. Div. Ct.). Simply stated, the Employer has failed to establish
the existence of the factual circumstances upon which it relied in its
decision to terminate the Griever's employment.
.Accdrdingly, the motion for non-suit succeeds and we must
ind that the Employer failed to establish just cause for dismissal.
Assuming that the Employer did establish a prima facie case,
there were a number of serious procedural'errors on the part of the
Employer, the effect of which, we think, was to invalidate the
discipline imposed. These procedural irregularities involve due
process and procedural fairness without which there can be no just
cause.
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No matter how distasteful to the Board, given the eventual
outcome of the fraud charges, arbitral jurisprudence is there to be
followed: namely, that an Employer must act in a reasonably
expeditious fashionin imposing discipline.
Brown and Beatty in their text, Canadian Labour Arbitration
under ,the heading of "Procedural Requirements and the Power to
Discipline" make the following observations at p. 335:
I,
. ..The requirement that the Employer must
sanction an individual for behaviour it regards as
inappropriate in a reasonably expeditious fashion,
are matters of general arbitral principle..."
In support of that proposition, three..cases are cited by the
authors: Wellington County Board of Education (1979), 24 L.A.C. (2d)
431‘ (Abbott); Borough of North York and Canadian Union of Public
Employees, Local 373 (1979), 20.L.A.C. (2d) 289 (Schiff); and
generally Re Nicholson and Haldimand-Norfolk Regional Board of
Commissioners Com'rs of Police (1978), 88 D.L.R. (3d) 671, 78
j '.L.L.C. 14,181 (S.C.C.).
In the Borough of North York'Decision (Supra), Arbitrator
Schiff rejected an eight month delay ,in imposing discipline and gave
the following rationale at pp. 296 - 297:
"Although...., an Employer is entitled to a
reasonable period of time to assess an, appropriate penalty, eight months is far. from reasonable: no
employee is bound to wait that long for a
.
- 23 -
verdict.. Once the reasonable period has
passed... the Employee is entitled to assume that
the offence has been forgiven....A decision unduly
delayed cannot be corrected at all: It is simply
invalid."
E. E. Palmer in his text, Collective Agreement Arbitration
in Canada (2nd Edition) comments at p. 284:
. . ..An employee can consider that no discipline
can be imposed against him for any act if the
Employer fails to act in a timely way..."
In an accompanying footnote, Professor Palmer writes:
"There are no cases on this point. The.point is
so obvious that none seems necessary..."
The Board adopts and applies the above arbitral principles.
Although the Board found that the suspensionof February 7, 1985 was
initially justified, an investigation from February, 1985 until June
20, 1986 cannot be sustained. In our opinion, the Employer should
have made a final disciplinary decision no later than the Grievor's
ndictment before the Grand Jury in April of 1985. Allowing for a
reasonable time to consider the evidence presented before t~he Grand
Jury, final disciplinary action should,have been taken noilater than
June 1, 1985. Sufficient facts were then known to the Employer by
June 1, 1985 to allow it to make an informed decision in a case of
employment related misconduct-. Beyond that date, the Grievor's
suspension cannot be justified.
! Similarly, on the evidence presented', the Employer should
have been in a position on the Plumtree Fur matter .to take some form
of f inal disciplinary action in November of 1985 when charges were
laid against the Grievor and when the Employer had full knowledge of
the particulars of the Crown's case. As the evidence reveals, the
Grievor was suspended pending investigation in December of 1985 and no
final disciplinary action was taken on this matter until some six.
months later. In our view, this delay is unreasonable and vitiates i
- 24 -
the discip1in.e imposed on June 20, 1986.
Following the Griever's arrest in November, 1984, Cahoon
proclaimed his innocence privately to several O.D.C. employees
including Myrna Morgan and John Mitchell. For whatever the reason, at
no time during either investigation was the Grievor asked by the
Employer to offer. any explanation of the allegations under
I
investigation. The Grievor cannot be' faulted for failure to explain
his conduct in the absence of a demand for an explanation. Simply
stated, he wasn't asked.. By February 27, 1985, the Grievor made his
-9sition clear through Counsel Paliare; n.amely, that he denied
everything and admitted nothing. Thus, the Employer was left to its
own resources to investigate the alleged misconduct. The'botulism
investigation and the Employer's reponse to acquired facts drifted on
aimlessly. The Plumtree Fur matter was investigated promptly by the
O.P.P.; however, the Employer appeared unable to reach a conclusion.
* i
: - 25 -
On May 20 ,.1986, Mr. Zarudny wrote to O.D.C. solicitor Brian
Cass, Q.C. advising that final disciplinary action should be imposed
immediately ,and that further delay would be unreasonable.
Surprisingly, O.D.C. proceeded to renew Cahoon's suspension on 'June 12
and did,not take the step to dismiss Cahoon until one month following
Mr. Z'arudny's letter. in the result, assuming that a prima facie case
had been established, the Board concludes that the Employer by reason
of its inordinate delay has failed to 'establish just cause for
discharge in June of 1986.
Generally, the Courts have recognized that arbitration
boards have extensive remedial authority inthe adjudication of
discharge and discipline-cases in the 'absence of express statutory or
contractual limitations. sunders. 19C.l) of the Crown Employees
Collective Bargaining Act, the Grievance Settlement Board has been
given broad statutory authority encompassed in the words "shall decide
the matter" and "its decision is final and binding".
On numerous occasions, the Ontario Divisional Court has made
it clear that s. 1,9(l) confers upon the Grievance Settlement Board
broad remedial authority. Referring to s. 18(l) (as it then was),
Mr. Justice Linden made the point in R.V. OPSEU (1982), 38 O.R. 670 at
p. 675:
”
. . ..Courts have been unwilling to'limit the
remedial powers of arbitration boards so as to
enfeeble them. On the contrary,.our Courts have sought to ensure that arbitration boards can
,
c - 26 -
effectively bring about the final binding
settlement of all differences between the
parties...."
Mr. Justice Reid adopted the same position in considering
s. 19 (1) of the Act in the Judicial Re,view of the classification
grievance in Carol Berry et al (Released March 13, 1986) where, in
referring to the Board's authority he stated at p. 13:
"Its authority under s. 19 of the Act is
untrammelled. It shall decide the matter...."
And at pp. 14 and 15:
n
,...The object of arbitration boards, both in the
public and private sector, is the resolution of
differences. That is the mandate ~of this board...
. . ..Its jurisdiction is unrestricted. Its mandate is remedial...."
In the absence of just cause for dismissal, the usual remedy
is reinstatement with full.compensation for all lost wages and
benefits. Having regard to the Grievor's two subsequent criminal
: ~jnvictions, reinstatement would be a totally inappropriate remedy. A
loans officer employed by O.D.C. is in a position of trust by virtue
of his position in the administration of public funds. As subsequent
events have established, the Grievor has committed two serious
criminal offencesagainst the interests of his employer. The
Grievor’s conduct is simply incompatible with the fiduciary
responsibility expected of the position of~a loans officer.
Accordingly, he will not be reinstated.
i.
= / ;
7, .’ ’ 1
I - 27 -
The more troublesome aspect of this case is the issue of
entitlement to and quantum of compensation. For the time being, we
reserve on the issue of compensation.
Compensation is, of course, a discretionary matter. Asp
I authors Brown and Beatty state in theirtext, Canadian Labour
Arbitration (2nd Edition) at page 61:
"Unless the agreement provides otherwise,
generally, in assessing damages arbitrators have
followed and utiliied the same common-law
principles that are applied in breach of contract
cases. Thus, the basic purpose of an award of
d,amages is to put the aggrieved party in the same
pos-ition he ~would have been in had there been no
breach of the collective agreement. As stated by
one arbitrator:
'Stated in the abstract, the relevant
principle is quite clear. The purpose of
damages for breach of contract is not to
punish but to compensate, and the function of
compensation is to place the aggrieved party
in a monetary'position as near as possible to
that in which he would have been had the
contract been performed."'
The passage cited was by Arbitrator Weiler in Canadian Johns
M’anville Co. Ltd. (1971), 22 L.A.C. 396.
Can it be said with any degree of credibility.that the
Grievor, Barry Cahoon, his an aggrieved party? Given the facts of the
instant matter, common sense and procedural fairness would dictate
that the Employer should have acted much sooner in deciding upon the
appropriate disciplinary response. However, in these circumstances,
.’ - 28 -
the question remains whether or not it would be appropriate to
compensate a dishonest employee thereby rewarding him and penalizing
the Employer for the Employer's inumerous procedural errors.
The Parties did address the compensation issue, albeit
briefly, but of course without the benefit of the Board's findings.
It would assist us to hear further submissions on this difficult
compensation issue. Accordingly, the Board directs the Registrar to
set a further date to allow arguments with supporting authority to be
resented on the issue of the Griever's entitlement to and quantum of
compensation in.the circumstances.
DATED a t Brantford, Ontario, this 4tb day of November
1987.
L < 4
R. L. VERITY, Q.C. - VICE-CHAIRMAN
W. A. LOBPAI
THE SUPREME COURT OF ONTARIO (DIVISIONAL COURT) Div. Ct. No. 974/88
Before: REID, OSBORNE AND GRAY JJ.
IN THE MATTER OF The Crown Employees Collective Bargalning
Act, R.S.O. 1980, c. 108;
AND IN THE MATTER OF an application for judictal revlew of
the declslons of the Ontario Crown Employees Grlevanc~e
Settlement Board, dated the 4th day of November, 1987 and the
28th day of July, 1988, with respect to the grievance of BARRY
CAHOON;
AND IN THE MATTER OF the Judicial Review Procedure Act,
R.S.O. 1980, c.224, as amended.
Between:
HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO, Applicant
- and -
ONTARIO PUBLIC SERVICE EMPLOYEES UNION, BARRY CAHOON,
AND ONTARIO CROWN EMPLOYEES GRIEVANCE SETTLEMENT BOARD,
Respondents
Dennis Brown, Q.C. for appl.lcant.
Colln Stevenson for.respondent Board.
Chrls Pallare for respondent Union.
Reld J.
Barry Cahoon was dismissed from his employment as a loans officer
wi,th the Ontario Development Corporation (0.D.C.) f.or defrauding O.D.C. and
others. He grieved to the respondent Board. A majority-awarded him
damages in the amount of $1 14,585.90. This application for judicial
review.challenges that award. The Board in fact issued two decisions, the
first on 4th November, 1987, and the second, entitled “Supplementary”, on
28th July, 1988. When I refer. to the Board or the reasons hereafter I mean
the majorlty and the reasons given by the majority.
O.D.C. was Cahoon’s nominal employer, but it is accepted that he was
1
‘-3.
:
employed by the CfOwn.
Cahoon had been employed by O.D.C. since 1981 as a loans offlcer, a
position the Board found was a position of trust by virtue of his
administration of public funds. His annual salary at the time of his
dismissal was $50,000.00. The events leading to his dismissal may be
briefly summarized. As the Board aptly observed, the facts of the case
are bizarre.
: 1984-85
On November 21, 1984, Cahoon was arrested in Buffalo, New York
and jaileu on charges of fraud and conspiracy to defraud (the American
charges). On learning of this, O.D.C. placed him on “special assignment”
two days later. The so-called special assignment continued until January
11, 1985, when he was notified by letter that he had been suspended with
pay pending “an investigation of your conclclct” in accordance with s.22( 1)
of the &WC 5efviceAct, R.S.O. 1980, c.418. By letter dated February 7,
1985, he was suspended without pay pending the invest\gation. On
February 13, 1985, Cahoon grleved the latter suspension as betng without : ‘.
\.~ just cause and askeu for “...reinStatement to my posltlon wlth fuil back
pay and interest”.
In August of 1985 O.D.C. became aware of information which led in
November to a further fraud charge being laid agafnst Cahoon in Ontario
(the Canadian charge). This stemmed from a false loan application to
O.D.C. allegealy made while Cahoon was on suspension. Thus, by letter
dated December 19, 1985, Cahoon was suspended without pay for a second
time, “Pending investigation pursuant to s.22( 1)“. That suspenslon has
never been grieved.
I
2
k’ ! i ~:
i
The grfevanco ult.imately came before a Board of ~three members of
the Grievance Settlement Board (the Board). The Board is established
under the Crbw/i fmphyees Co//ective Bargafifng Act, R.S.O. 1980, c. 108,
~ss.18 and 19, to determine whether a Crown employee has been dismissed
without just cause. The grievance he,aring commenced. on January 23,
1986, and was adjourned to be continued on t-lay 2 1 St.
On June 20, 1986, Cahoon was dismissed by Patrick L,avelle; the
c. Deputy Minister of mdustry, Trade and Technology. The dismissal letter
read:
Dear Mr. CahOOn.:
We have investigated, and are continuing to
Investigate, your conduct as an employee at Ontario
Development Corporation.
The, evidence which has been obtained
indicates that you have misconducted. yOUr,self as an
employee of Ontario Development Corporation with
respecttotwo separate pcldents.
,. ,’
i,;-
.First, during the Period August - November,
1984, you abused your position as a loan consultant by
obtaining, and attempting to obtain, bacteria, micro-
organisms and other substances, for your own personal
use.. By so misconducting yourself; you seriously
violated and prejudiced the trUSt of your etYQlOyer and
its client, I.C.M.Science, Inc.
Secondly, during the period February -
August, 1985, you participated In a fraudulent scheme
with Richard Pintar whereby a loan in the amount of
%.I 5,OOO.OO was obtained from Ontario Development
Corporation for Plumtree Furs. The proceeds of this loan
were. directed to another business owned (in part) and
operated by yourself.
You have continuously refused to- confirm ‘or
1
deny to your employer your participation In either of these incidents. This has caused your employer to 1nCUr
considerable additional expense and effort to investigate
your conduct
Accordingly, I hereby dismiss you from
employment at Ontario Development Corporation.
You are alSO hereby advised that you have the
right to grieve this dismissal pursuant to the provisions
of subsectfon 18(2) of the Crown Employees Collective
Bargaining Act.
On June 24, 1986, the Union notified the Board that Cahoon’s
dismissal was being grieved and that the union agreed to waive the
prelfminary hearing stages so the dismissal grievance could be dealt with
by the Eoara adjudicating the~suspension grievance. Although the UnlOn’S
letter does not state the basis for the grievance or the relief requested.
there appears to be no debate that the grounds and relief reouested were
identical to tnose in the suspension grievances
The hearing continued on June 24th, 25th and 26th. On September
‘_ 15th CahOOn pleaded guilty to the American charges~ I / ‘, The hearing Continued on October 8th and 14th and November 18th~
On December 3rd, Cahoon pleaded guilty to the Canadian charge.
JLW
In 1987, the hearlng continued on April 2nd and 7th and May 6th. At
the end of the employer’s evidence Cahoon’s counsel moved for a non-suit
and elected to call no evidences
The first decision
The Board reserved on the non-suit motions On November 4th, 1987
c Its declslon was released granting, by a majority,“the Union’s motlon for
4
non-suit on the basis that there was no co~gent evidence to explain the
reasons for the grievor’s dismissal In June of 1986”. In addition the Board
held, (as it explained in its Supplementary Reasons) that .the Employer’s
“inordinate procedural delays In the imposition of final discipline
invalidated the diSmissal”. The dissenting member expressed. the view
that O.D.C. had establi.shed a prima facie case.
-lizi.&
The suoolementarv decision
The Board had found the question of an appropriate remedy to be
“difficult”. This was because reinstatement was the usual remedy for
unjust dismissal, but Cahoon had disentitled himself ,to it by his own
conduct. The Board therefore called for further argument: That occurred
on March 26th, 1988. After receiving written submiSsiOns. the Board
again reserved its decision. On July 28, 1988, the supplementary
decision regarding remedy was released. The Board awarded damages to
Cahoon on two different bases. The first was for salary and benefits lost
through the delay in dismissing, The second was damages “in lieu of
reinstatement”. Interest was awarded on the aggregate amount. The
Board did not calculate the damages, but Mr. Paliare’s Calculation, Set Out
below, is accepted:
1. For the delay in dismissing, calculated on the basis of lost wages
and benefits from June 1,1985, to and, including December 3, 1986, the
sum of $72,763.95
2. In lleu of re~instatement, as “additional damages”: $36,228.23
3. Interest, $5,593.72
Total $1 14,585.90.
The dissenting member would not have awarded “damages of any
5
i
kind”
The Board was consctous that a grant of substantial damages to a
Person who had defrauded his emPloyer (as evidenced by his guilty Pleas)
might well be viewed as an affront to common senses The Board observed.
To some, it mlght seem an affront to common
sense to say that an employee who has commltted fraud
against his Employer (as subsequent events have
established) has not been dismissed for just cause. (First
reasons, ,P 19)
The Board was troubled abOUt it. Thus,
“Can it be said with any degree of credibility that
the Grlevor, Barry Cahoon, is an aggrieved party? Given
the facts of the Instant matter, common sense and
procedural fairness would aictate that the Employer
Should have acted much sooner In UeCldlng upon the
appropriate disciplinary response. However, in these
circumstances, me Question remains whether or not it
would be appropriate to compensate a dishonest
employee thereby tewardlng him and penalizing tne
Employer for the Employer’s numerous procedural errors.
(First reasons, ~~~27-28)
It was’distasteful” but it must be done. Thus,
No matter how distasteful to the Board, given the
eventual outcome of the fraud charges, arDitra1
jurisprudence is there to be followed; namely, that an
Employer must act in a reasonably expeditlous fashion in
imposing discipline. (First reasons, p.22)
Board’s f irldmgs,
The Board’s eleven sitting days were taken up With the employer’s
evidence and counsel’s submissions Cartoon did not testify No evidence
was Called on his behalf~ His counsel moved for a non-suit and elected to
6
call no evidence. The Board reserved. It granted the non-suit.
In its reasons, the Board set out 0.D.C.S case and summaries oft the
“safient” evidence. The evidence of some wftnesses was described at
length.. One was Mitchell Bros, the officer of O.D.C. who had been given the
tasks of investigatlng Cahoon’s conduct that had given rise to the
dismissal. Another was Richard Pintar, who had revealed to 0.D.C the
fraudulent loan. He and a Corporal Ralph Paul described how Cahoon had
initiated’and carried out the fraud on O.D.C.
The record returned. by the Board in response to this applfcation
ShOwS that the evidence contained a host Of documents, Statements,
search warrants, orders and reports, transcripts of both guilty pleas, the
statement of .the American Government’s case presented to the court
before the plea was accepted In the American proceedings, the affidavit of
John McGuigan, the F.B.I. special agent who had investigated the American
case, which set out in detail how the fraud had ‘been accomplished by
Cahoon and his co-conspirator, and the affidavit of Serge Jullen, prjncipal
of I.C.M. Science, (I.C.MI who had informed the police of the order Cahoon‘ i :+;
&: had falsely placed in I.C.M’s name.
This evidence revealed in detail how Cahoon had perpetrated the two
frauds. Through the facilities of his O.D.C. office Cahoon had placed orders
by way of telephone calls and letters to an American scientific
foundation, Amerjcan Type Culture Collect~ion (A.T.C.C.), a manufacturer of
micro-OrganiSff6 distributing only to legitimate scientific research
OrganlZatlOnS. Cahoon’s stratagem was to pretend that the orders were
Placed by I.C.M, a Canadfan company In that category. KM. was known.to
Cahoon through an application the company had made to O.D.C. for a loan.
c:. In COnneCtiOn with its application I.C.M. had supplfed CahOOn with a master
7
list of its suppliers of bacteria and micro-organlsms.
Cahoon hid his deceit by various devices. He adopted the name
“Thomas PlaXtOn”, when pretending to be vice-president of I.C.M. in letters
he had wrltten on I.C.M. letterhead to A.T.C.C. to place or further these
orders. He Instructed hls secretary not to answer “O.D.C.” when A.T.C.C.
called his office. He Induced A.T.C.C. to make dellvery to an address in
Buffalo, New York. However, the fraud was discovered by I.C.M. which
I alerted the F.B.I. It, in turn set a trap (consisting of a false delivery) into , which Cahoon and his co-conspirator fell. They were arrested at the
Federal Express office in the Buffalo suburb of Cheektowaga in POSSeSSiOn
of a false package of tetanus and botulism culture. Cahoon’s object was
said to be to kill a racehorse that he and his CO-COnSPiratOr owned in
Order to obtain the $100,000 for Which it was insured. The fraud charges
stemming from these American activities were the ground for Cahoon’s
f lrst suspension.
The essence of the Canadian charge was that Cahoon had by devious
means obtained a loan from O.D.C. to enable his co-conspirator Plntar to
acquire an interest in a company of which Cahoon was a co-owners The ;\. evidence showed that .Cahoon had pleaded guilty on December 3, 1986 in
Hamilton, Ontario, to the charge that
“between September 15, 1984 and September 15,
1985 at the City of Hamilton in the Judicial District of
Hamilton-Wentworth and elsewhere in the Province of
Ontario, did by deceit, falsehood or other fraudulent
means defraud the government of Ontario represented by
the Ministry of Industry, Trade and Technology and the
Ontario Development Corporation of an amount of money
In excess Of $200.00 to wtt, that documentatton and
informatlon provided to obtain a loan in the amount of
$15,000~00 under the Help Four Entrepreneurs Loan
Programme was ~false, contrary to the provlslons of .
section 338 of the Criminal Code of Canada.”
In dealing with this the Board found that,
At the Hearing, evfdence established that Pintar
applied-for and obtained a $15,000.00 loan from O.D.C. by
falsely submit,ting documentation t,o demonstrate that
the proceeds of the. loan would be used for an exotic .
animal rug manufacturing operation known as PlUmtree
Furs (a business operated by Pintar). The evidence of
Pintar and of Corporal Ralph Paul established that the
$ I S,OOO.OO was improperly diverted to “6 13 170 Ontario
Inc. operating as National Aquarium” to enable Pintar to
purchase a l/3 interest in a tropical fish retail business.
The evidence of Pintar and Corporal Paul also established
that the Grievor initiated the fraudulent operation,
informed Pintar of the availability ,of the H.E.L.P.
program, advised Pintar in all procedural ,matterS
required to obtain the loan, and prepared a business Plan
for submission to the O.D.C., all the while knowing,that
the application misrepresented the true purpose of the
loan. In sum, .the evidence at the hearing clearly
~established that the Grievor orchestrated the fraudulent
operation to enable Pintar to acquire $15,000.00 of a
$2O,OOO.O0 l/3 interest in National Aquarium.
By August of 1985, ,Pintar withdrew from the
partnership and voluntarily advised the O.D.C. and ,the
‘. O.P.P. anti-rackets branch of the sham. ,Pintar assisted
the O.P.P. in their investigation from the outset and.
‘pleaded guilty to the fraud charge. (first reasons, p. 7)
for the criminal charges.
The misconduct described in the dismissal letter was also the basis
The Board found that following his first arrest in November, 1984,
Cahoon proclaimed his innocence privately to O.D.C. employees and ,that
“whatever the reason, at no time during either investigation was -(he)
asked by the Employer to offer any explanation of’ the allegations under
investigation”. It found further that by February 27, 1985, Cahoon had
9
“made his pOSitiOn clear” through counsel “that he denled everything and
admitted nothing.” He aopears to have malntained that Stance Until
aecidlng to plead guilty to the American charges in September, 1986~
The Board found that in the result “the Employer was left to its own
resources to investigate the alleged misconduct”. Bros, O.D.C.‘s
investigating officer, interviewed members of the ODC’s staff,
representatives of the companies involved, and Drosecutors and p0Iice
( both in Canada and the United States. Notwithstanding the Impressive
evidence of Cahoon’s misconduct he had gathered by the summer of 1985
Bros thought that the evidence linking Cahoon to the botulism was
“circumstantial”. He was hoping for a guilty plea that would provide
“direct” evidence. However, in December, 1985, further evidence was
found by accident in O.D.C.‘s files in the form of a letter that CahOOn had
sent to I.C.M.. O.D.C. still hesitated. It was not until June of the fOllOwlng
year, months after Cahoon had pleaded guilty to the American charges,
that he was dismissed.
The Board’s reasoning ;’ r ~‘,
‘... The Board (a) reviewed the evidence and “the arbitral jurisprudence”,
(D) observed that the Employer did not rely on the criminal charges or
their OUtCOme, tc) noted the Union’s non-suit motion, (d) helci that the onus
to establish adequate grounds for suspenslon and dismissal was on the I
employer, (e) observed that the employer had not called a witness to State I
~ the reason why Cahoon was discharged “at the relevant time”, ,(f) I
described this as a “fatal flaw” In light of the de!ay of seventeen months I
between susbension without pay and dismissal, (g) observed that the
letter of dismissal itself was insufficient to establish a prP77a far12
! case, and, (h) concluded that “the Employer has failed to establish the
10
/
existence of the f~actual circumstances upon which it relied in its decision
to terminate the Grievor’s employment”.
The grant of the non-suit might have been expected to end the
matter but it did not. The Board went on to consider whether the
grievance must succeed even if a prima facie case had been proven. The
Board said, at p. 21’of the first reasons,
Accordingly, the motion for non-sult succeeds and
we ‘must find that the Employer failed to establish just
cause for dismissal.
Assuming that the Employer did establish a Prfma
facie case, there were a number of serious procedural
matters on the part of the Employer; the effect of which,
we think, was to invalidate the discipline imposed.
These procedural irregularitles involve due process and
procedural fairness without which there can be no Just
cause.
The Board thus turned from the significance of the absence of
evidence to the significance of the evidence itself. The procedural error
was essentially that Cahoon should have been diSmtSSed sooner. The
Employer should have made a “final djsciplinary decision” no later than
June 1, 1985, because by that time “sufficient facts were then known to
allow it to make an lnformed decision” (concerning the American charges) .,
and by November, 1985 (concerning the Canadian charges). The Board thus
concluded that the Employer “by reason of its inordinate delay has failed
to establish just cause for discharge in June of 1986”.
Having’granted a non-suit, on one, and perhaps two, grounds, (it 1s
difficult to tell whether the Board thought the;procedural irregularity was
as aspect of the non-suit or stood somehow by itself) the Board then
proceeded to consider an appropriate award. It observed that the usual
remedy was reinstatement with full compensation for all lost wages and
benefits. HOweVer, the Grievor had committed two serious crlmlnal
offences against the interests of his employer. That Conduct was
incompatible with “the fiduciary responsibility expected of the position~of
a loans officer”. Thus, the Board concluded he could not be remstated, but
was ent\tled to damages, both for the delay in dismissal and in lieu of
relnstatement.
The non-suit
J&e balance of Drobabilities as the onus of Droof~
The non-suit motion rested on the ground that the emDloyer had
failed to make out a pf1??7~ fxl’e case of adequate grounds for diSmISSal.
In light of the uncontested evidence setting out in detail how the frauds
were accomplished it is difficult to understand why the non-suit was
granted. In my respectful opinion, the reasoning which led to this
conclusion was fatally flawed. It stemmed from the Board’s
misunderstanding of the nature of a non-suit.
The Board began by setting out its understanding of a non-suit.
White it held that a ,NZV~ facie case had not been made out,its reasons
make it clear that it believed a ,mk77,3fme case had to be established on
the balance of probabilities. This is, of course, incorrect. It then turned
to constder the evidence. By a series of further errors it managed to
dlsregard virtually all of the evidence that had been placed before it.
The Board said, at p. 20 of its first decision,
As Indicated previously, the Union brought a motion
for non-suit at the conclusion of the Emp\oyer’s case.
From the outset, Mr. Paliare put the Employer to the
Strict proof of its Casey The Union alleged that the
Employer failed to call any cogent evidence as to the
12
!
reason for the Grievor’s dismissal on June 20, 1986.
In dfsclpllnary matters, the onus rests with the
Employer to establish, upon the’balance of probablllties,
that It had just cause to take the disciplinary action.
The Union’s motion was directed to the sufftciency of the
evidence adduced. Accordingly, the Board.ls required to
assess the probative sufficiency of the evidence and to
decide whether there was enough evidence, If left
uncontested, to Satisfy the onus of proof.
This betrays a fundamental misunderstanding of the nature of a non-
suit. The standard of proof on a non-suit is that of a prima facie case,
not a case on the baiance of probabilities. If a prim2 &cie’case has been
shown a non-suit must not be granted. It is erroneous to determine a non-
suit motion on the basls of the hfgher onus of the balance of probabilities.
A prim facie case is no’more than a case for the defendant to answer.
“The term non-suit describes the modern practice ;
of the defendant making an application for judgment at
the ClOSe of the plaintiff’s caSe,on the grounds that the
plaintiff has fafled to make out a case for the defendant
to answer.” Williston and Rolls, “The Conduct of an
Action”, p.45. (Butterworths)
“A motion for non-sult In modern practice 1s made
by the defendant, contending that the trier of fact should
not proceed to evaluate the evidence in .the normal way,
but should d&miss the. action. The defendant must
satisfy the trial judge that the evidence is such that no
jury, acting judicially, could find in favour of the
plaintiff. The decision of the judge In both jury and non-
jury actions is a decision on a question of law. Sopinka, ,I Trial of a@ztion”, p. 124.‘(Butterworths)
The “normal way” in a civil, action would be on the balance of
probabilities. Where a judge is sitting with a jury, the issue is whether
there is-some evidence to support the claim. If there Is, the case goes to
13
I the jury. If there is none, it doe5 not.
When sitting alone the judge poses the same ouestlon~ If there is
some evidence a motion for non-suit must be dismissed. If there is none,
It must be granted.
In performing this function the judge must lean in f&Our of the
respondent to the motion. In Ha// ef al: Y Pembefton (19741, 5 OCR.
438 ( CA.) at pp. 438-9, Jessup J.A. said, for the court,
“Tne prrnciple which tnis Court must apply iS
stated by Lord Penzance in Paffift v Lawless (18721, 41
L.J.P. 8, M. 68 at pp. 7 l-2 where he said:
I conceive, therefore, that in judging
whether there is any case evidence for a jury
the Judge must weigh the evidence given,
must assign what he conceives to be the most
favourable meaning which can reasonably be
attributed to any ambiguous statements, and
determine on the whole What tendency the
evidence has to establish the issue.
and:
From every fact that is proved,
legitimate and reasonable inferences may of
course be drawn, and all that iS fairly
deducible from the evidence is as much proved, for the purpose of a pftn?J fXlP case,
as if it had been proved directly. I Conceive,
therefore, that in discussing whether there is
in any case evidence t0 go t0 the jury, What
the Court has to consider is this, whether,
assuming the evidence to be true, and adding to the direct proof all such inferences of fact
as in the exercise of a reasonable
intelligence the jury would be warranted in
drawing from’ it, there is sufficient to
SUDDOrt the iSSUe.
See to the same effect Re Gal/an? and Sudbff~~ Rm?m Cafndic
14
Separate SchoolBoard ( 1985), 56 OR(2d) 160 (Ont.C.A.).at 167.
As further indication of the favour that courts traditionally grant to
respondents to non-suit motions, it has been held that a trial judge has a
,discretion to permit respondent to prove a fact left unproved by
inadvertence: Onf. Motor Sales L fd K Steeve& [ 19591 O.W.N. 205 (0nt.C.A).
Over the years there has been some variation in the praCtiCe ‘On non-
suits turning on the question whether the mover must COnCUrrently elect
( to call no evidence. -That has now been resolved. A motion will not be
entertained without an election to call no evidence: see Bank Of Mont& ~~
K Horan et al ( 1986), 54 O.R. (2d) 757.
There i,s no reason to think that ,a motion for a non-suit before an
adminjstrative tribunal should not conform with.the law that governs the
COWS. The Board applled the~wrong standard of proof, but beyond that, it
was apparently unaware of its duty to lean in favour of a respondent to a
non-suit motion and of its discretion to permit evidence omitted through
inadvertence to be adduced.
Court practice is summed up neatly~ in the rule proposed by the
:i-’ Williston Committee referred to in.-tne’ following passage from “I!%
Princioles of Non-Suit in Ontario”. by Alian~ M. Rock. Q.C. (in “Studies in
Criminal Procedure”, Eric Gertner ed. (1979) Butterworths 1
InOntario, as in England, the courtshave shaped
the practice and formed the tests In motions for non-
suit: no statute or rules govern the procedure.
In Ontario, however, the WillistOn Committee, in
its .Workhg Draft of Proposeq Ontar@ Rid/es of CM'I
Procedure included, in the section entitled “Trial
Procedure”, draft’rule 54.14, which provides as follows;
54.14 Application /of Non-Suit
When the .evidence in chief on behalf of the
3. 15
I j”: ‘\..
I
!
I
plaintiff 1s concluded, tne defendant, wnere he elects to
call no evidence, may move for dismissal of the XtlOn on
the ground that, having regard to the evidence and the
law, the Plaintiff has not made out a ~fPrL3 f&T/? Casey
The Simplicity of the draft rule isattractive: while
codifying the three essential elements of the practice
(the conclusion of the plaintiff’s evidence prior to the
motion, the election by the defendant not to call evidence
anu the test whether a pfhix3 fx~ecase nas been made
out), the draft rule wisely refrains from seeklng to
regulate every aspect of the procedure.
It is clear that on a motion for non-suit where the defendant
Calls no evidence a judge may not make findings of fact: A&d&r Y
CnornQC1973), 2 O.R.1 (CA. Ont.). That would be for the jury lf a
sufficient case had been made out to go to the jury.
It is true that after having set out its understanding of a non-suit
motion, the Board later referred to a "pfiim facie" case, but it appears to
have thought that a pf&Vd f~cie case was one established on the balance
of probabilities. Thus, at p. 21 of its first reasons, m relation to the
dismissal letter, the Board said, “Simply stated, the evidence in the form
Presented in Exhibit 3a is insufficient to establish a prm?~ facie case of
dismissal for just cause.” and, “Accordingly, the motion for non-suit
succeeds and we must find that the Employer failed to establish Just
cause for dismissal”.
Passages in its supplementary reasons confirms this impression. On
the first page of those reasons, in reviewing its first decision, the Board
said, “Further, on the evidence, the Board found that the Employer had
failed to eStabliSh just cause for Cahoon’s dismissal on June 20, 1986”
At p. 4 we find, “Boards of Arbitration are understandably reluctant to
deny reinstatement in circumstances where just cause nas not been
16
establlshed.” and at p.7, “By granting the motion for non-sui,t, the Board
accepted with [SIC] the Union’s positlon.and concluded that the Employer
had indeed failed to discharge the onus of establishing just cause for the
dlsmissal on June 20, .I 986.”
In Its supplementary reasons the Board summed up its reasoning in
Words that make it clear It considered, the issue not to be whether there
was w evidence, but whether there was w evidence. It said, at p., I,
The Board granted the Unlon’s motion for non-suit
on the basis that there was no cogent’evldence to explain
the reasons for the grievor’s dismissal in June of 1986.
Cogent’means “convtncing”. The Board was not convinced. But
that was not the Issue.
These passages appear to put beyond question the Board’s bellef that
the 1SSUe before them was: has the employer~proven the existence of just
cause on the, balance of probabilities?
With this standard In mlnd the Board t,urned to consider the evidence.
It can be divided tnto three categories: (I) the guilty pleas, (I~i) the
misconduct alleged in the dismissa! letter, and (ill.1 the djsmissal letter.
The Board d®arded the guilty pleas because the employer had not
moved to add them by way of an amendment to the dismissal letter. It
next considered the misconduct evidence. The evidence led In support of
the misconduct alleged in the dismissal letter consumed most of the
eleven days the Board sat. It descrlbcd the mlSconduct In detail. It was
uncontested. The Board disregarded it because a witness had not-.,been
cal’led to ~testify to the ~truth of the grounds set out in the dlsmrssal
letter. That left the dismissal letter, It was held to be Insufficient
because It was “hearsay”. The result tiaS that the employer had not
17
demonstrated a &T&M facie exe... The non-suit was granted.
fd of the $juUwk%
The guilty pleas were dlsregarded entirely because the emDlOyef had
not formally moved to amend the dismissal letter to add them as grounds
for dismissal. (The Board appeared to disregard as well the evidence Of
the crlmlnal charges that had led to the suspenslons and discharge.)
In Its first declston the Board observed, “There was no disDute that
/ the Employer based its acttons on tne outcome of criminal proceedings
against the Grlevor. Clearly , It dtd not. In fact, the Employer made no
reference to any outstanding criminal charges in either the February 7,
i985 suspension or in the discharge letter of June 20, 1986.” (first
reasons, p.19). ‘The Employer based its case on two Separate allegation5
of misconduct alleging abuse of position. There was no reference in the
dismlssal letter to any outstanding criminal charges” (p.20, lU). Later,
in Its suPDlementary aeclslon, the Board sald, “For whatever the reason,
the Employer did not rely upon either guilty plea to Justify the dismissa\.
In fact, at no time did the Employer bring a motion to expand the grounds
I for dismissal on the basis Of the two subsequent guilty pleas.” ‘..
J fie d s eaard of the misconduct evldenceL 1 r
II atal flaw I,
With the evidence of the guilty pleas and the dismissal le:ter
disposed of, the Board had to deal with the rest of the evidence adduced
over the eleven days of hearing. While it did not reject is as InadmiSSi,ble,
it disregarded it because the employer had not called certain other
evidences That failure the Board characterized as a “fatal flaw” in the
employer’s case. The Board said,
!
18
There can be no doubt that Mr. Zarudny [COunSel for
O.D.C. at the hearing] went to great lengths to prove the
two separate allegations against the Grievor of
fraudulent conduct on the various hearing dates To
discharge the burden of proof in a dismissal case, the
Employer is required to establish why it discharged the
Griever at the relevant time. The Only evidence before
the Board as to the reasons for termination was the,
dismlssal letter of Deputy MInfster Patrick LaVelle
(Exhibi,t 3a). Neither Mr. Lavelle nor any other witness
familiar with the reasons was called upon to testify. In
our opinion, the failure.on the part of the Employer to
call a ,key witness was a fatal flaw. In light of the
excessive delay between the suspension without pay and
the eventual discharge (some 17 months later), the
Employer was under an obligation to call oral testimony
from some key witness to explain and justify the reasons
for dismissal in June of 1986”.
I found that language unclear. What was meant is Illustrated by the
argument put to the Board by Cahoon’s counsel. Mr:Paliare filed on thls
applicatioh~ for judicial review this written submissions to the Board.
Under the heading, “NO evidence with respect to the dismIssal” this
appears,
The employer failed to call any cogent evidence as
to the reason or reasons for’the dismissal of Mr..Cahoon.
The union asserts that this failure i,s a fatal flaw in the
employer’s case.
The onus of proof to establish just cause rests
with the employer. As part of establishing its case, an
employer must call evidence to establish why it
discharged an employee. ‘The Q& evidence before the
Board setting out the employer’s reason for dismissing
Mr. Cahoon 1s Exhibit 3A. the letter of dismissal which
was introduced into evidence as being nothing more or
less than the letter which Cahoon received wherein he.‘.
was advised of his dismissal There was never any
agreement that the contents of the letter of dismissal
were true. Quite the contrary. Counsel for the, union,
advised the employer at the outset that the union would
be putti,ng the employer to the strict proof if its case.
19
i
I {,:,I
I.~ ._, I
The letter of dismissal was signed by Patrick
Lavelle, Deputy Mlnlster, Rlnistry of Industry Trade &
Technology. Neither Mr. Lavelle or anyone else
associated With the decision t0 terminate Rr~ Cahoon
was called as a witness In these proceedings to advise
the Board whether the contents of the letter of dismissal
were trues Thus the Board is in the position of having
only hearsay evidence before it in the form of Mr.
Lavelle’s letter. Tne Dtvlsronal Court in Glrvln and
Consumer’s Gas Co. ( 1974). 1 0. R. (26) 42 1 made it Clear
that although a Board of Arbitration can admit hearsay evidence, it cannot rely exclusively on hearsay evidence
to establish any materlal elements of the case
Otherwise, an employee will be deprived of a fair hearing
because he is being deprived of the opportunity to cross-
examine on the evidence that was presented. Because
there was no cogent evidence upon which the employer
can justify Its decision to dismiss Mr. Cahoon, the
grlevor must be reinstated.
The Board accepted this argument. There is no question that the
bonafides of a dismissal may be challenged. In R/~I?r&f~v ConCr0/D&3.
CZV& Ltd et a,! ( 1984), 14 D.L.R.(4th) 289 (5.C.C.) the ostensible reason
for the dismissal was that the employee had improperly, and contrary to
express inStrUCtiOnS, accepted a benefit from a CuStOmer. However,
evidence was admitted by the arbitrator establishing that relations
between the employer and Blanchard had deteriorated in the three months
preceding the dismissal because of a complaint Blanchard had made to the
Commission de surveillance de la langue francaise. The arbitrator
concluaed that was the real reason for the dlsmlssal.
Here there was a mass of evidence consistent with the grounds given
I
I ,
In the dismlssa\ letter. There was no evtdence, or at least, none of which
the Board took note, to suggest that the given reasons were not the real
reasons. CahOOn did not testify, nor did anyone on his behalf. There was
simply no basis for any inference other than that the dismissal was “true”
20
i
in the sense that it was for the reasons given, It would have been highly
unreasonable to infer that Cahoon had been dismissed for any other reason.
It is thus difficult to understand why the Board thought there was
any need for anyone to be called to testify to the obvious. It is even more
difficult to understand how lack of evidence of a person who could say
that.they made or participated in the decision could be thought to be so
critical that its absence rendered the rest of the evidence valueless,
The Board’s “fatal flaw” concept appears to be further illuStratiOn of
its misunderstanding of the degree of proof required to establish a ,~fiirM
far)? case. I have observed that the evidence of misconduct was
substantial and uncontradicted. In light of it it was not rational to
conclude that there was no evidence. This indicates that the Board must
,have been weighing the evidence in the balance of probabi~lities. It was
not open to it to say that there was no evidence of misconduct. It must
thus have concluded that because of the absence of a certain Witness or
certain.kind of witness the evidence adduced tias insufficient~ to tip the
balance of probabilities in favour of the employer’s case..
The dismissal letter,
Having disposed of the guilty pleas and the misconduct evidence the
.Board was left with the dismissal letter. It thought that it., standing
alone, was insufficient. The Board said, in an almost exact repetition of
the union’s submission Set out above,
Simply stated, the evidence in the form presented
in Exhibit 3a is insufficient to establish a prima facie
case of dismissal for just cause In our ,opinion, Mr.
LaVelle’S letter in the form presented, althougn
admissible, is hearsay evidence which cannot be relied
upon exclusively to establish just cause for the.
disciplinary action. See -Re Girvin et al. and Consumers’
2 1
Gas Co. ( 1973), 1 OCR. 42 I font. Div Ct.)
It summed up Its view of the evidence in the followlng words,
agaln reflecting its acceptance of the union’s submission,
Simply stated, the Employer has failed to
establish the existence of the factual circumstances
upon which it relied in its decision to terminate the
Griever’s employment.(first reasons, p.2 1).
1. ldentlarv errors
I have dealt With the effect on the non-suit of disregarding the
guilty pleas and the evidence of misconduct. From a different point of
view, simply as an evidentiary matter, this discloses serious error.
Lhe quiltv oleas aQain
The Board did not refuse to admit the the evidence of the guilty
Pleas. Yet it wholly disregarded them because no formal amendment
referring to the Pleas was made to the dismissal letter, and the employer
had not proved or sought to prove the pleas as grounds for dismissal.
Yet the evidence of the guilty pleas was clearly relevant to the
(~. grounds Set out in the dismissal letter. Those grounds were not Only the
basis for the dismissal, they were as well the basis for the criminal
charges to which Cahoon pleaded guilty. The fact that he pleaded guilty
must inevitably be seen as supporting the employer’s posltion that
adequate grounds for dismissal existed. Thus, even in the absence of an
amendment which would have made the guilty pleas directly relevant .to a
ground for dismissal, they were still relevant to the grounds that were
“pleaded”.
In other words, the pleas were relevant-to the grounds that had been
k stated. The question for the Board was what weight to give theme It
22
I
” :
‘i J
might be suggested that the pleas had little weight. Views might differ
about how much weight to give to them. But the Board did not consider
weight at all. Having taken the view that the pleas were irrelevant
because the “pleading” had not been amended to include them specifically
the Board disregarded them entirely. That, in my respectful opinicn, was
wrong.
The misconduct evidence aaain.
c I have treated this as error affecting the Board’s handling of the
non-suit. Yet standing by itself, irrespective of the non-suit iSSUe;it was
erroneous. The Board’s view that the employer .was obliged to Call a
certain Witness, or a certain kind of witness,~ discloses. an even more
fundamental error in its understanding of its function. The Board was a
trier of fact. .Its function was to consider the evidence it saw fit to
admit. It was not in a positions to disregard evidence of misconduct
beCaUSe no one had been Called who had personal knowledge of the reason
for the dismissal. The Board had to take the evidence as it stood, not as it
:. of%: thought it should stand. Like any other trier of fact, Abe it tribunal, judge
or jury, the Board’s function was to draw whatever inferences were
appropriate from the evidence. Its ,function was not to instruct the
employer on how to present its case any more than it was to Instruct the
Union.. It was for the parties to decides what evidence to call. The
employer had adduced evidence that could lead to only one reasonable
inference, i.e. that Cahoon had been suspended and then dismissed for, the
reasons given. There is no law or even rule that requires a party to a
.proceeding of this type to present its ca;e in some particular w,ay and call
i
some particular witness. In directing the employer’as t,o what witnesses
.._A to call, and in effect penalizing it for’not calling them, the Board
23
’ c L-
,
demonstrated a fundamental misconception of its role In adjudicating the
grievance.
On judicial revlew courts are permitted only llmlted concern with
the evidence before a tribunal. Simp:e error of fact, Other than the
complete absence of evidence to support a flnding of fact, Is not a basis
for intervention, even if it would be on a broad appeal. The reason for this
is a practical one. there is not normally a transcript of evidence as there
would be on an appeal. Thus, unlike on appeal, the court iS not In a
posltlon to evaluate the evidence to determine such @JestiOnS as whether
proper inferences were drawn from the evidence or sufficient weight
given to certain parts of it. These are regarded as QueStiOnS of fact
b.eyond the normal reach of judicial review. ~
On the other hand, the entire absence of evidence to support a
finding of fact is a basls for intervention on judicial review, for that is’
error of law. Similarly, error in the admission of evidence, or the
rejection of evidence, would not be a basfs for intervention on judicial
review in the face of a privative clause unless It led to an error of law so
serious that it demanded correction or an error of jurisdiction.
This is illustrated by the decision of the Supreme Court of Canada in
~ofot?to Newspaper GuihY y: Globe Printtfig Co, [ 195312 S.C~R. 18, where the
Court overturned a decfsfon of the Ontario Labour Relations Board because
the Board had refused to admlt certain evidence. The Board had a
CertiflCatlOn appllcatlon before lt and the employer raised the question
whether the employees concerned were still members In good standlng of
the UnlOn or whether they had resigned. The Board refused to allow the
employer to cross-examlne the Unlon officer on the polnt and ruled that
the matter of the reslgnatlons was Irrelevant. The majority of the
24
i
Supreme Court of Canada held. that rather than merely wrongly refusing to
receive evidence, the Board had declined jurisdiction in So doing. At p. 35,
Kellock, J. said for the majority,
In the case at bar it was impossible for the Boara
to determine Whether any one of the persons alleged to
be members of the appellant was in fact a member in
good standing if the Boarci refused to enter upon the
question as to whether or not, assuming membership to
have originally existed, it had contUIued. This was the
very Obligation placea upon the Board by the statute. By
refusing to enter upon it, ,the Board in fact declined
jurisdiction.
The issue raised here is not simply whether the Board erred in
admitting evidence; it admitted all the evidence it later disregarded, Yet
wrongly disregarding the evidence amounted to the same thing as
wrongfully refusing to admit it. The error is thus of the same,Quality that’
led the Supreme Court to quash the Board’s decision in the 5/0PP case. It
amounts to declining jurisdiction.
J&&& ace
The fact that the Board granted the non-suit did not end the
proceedings as one might have expected it would. The Board went on to
make a finding that even if a ,~rcrnir7a fx@ case had been made out, O.D~C.
had been “negligent” in failing to dismiss Cahoon at anearlier date and
that the grievance fftuSt succeed because of that negligence.
At p. 25 of its its first decision, the Board observed, “In the result,
assuming that a prima facie case had been established, the Board
concludes that the Employer by reason of. its inordinate delay has fai’led to
establish just cause for discharge in June of 1986.”
While this’language is note entirely clear I think it means that evenif .’
O.D.C. had grounds for dlsmissal,it lost Its right to dismiss through delays
The baSlS for the nOn-SUlt was lnadequate grounds for dlSmlSSal. Once It
was decided that the grounds were inadequate there was nothing further
to consider. That disposed of the non-suit. But the Board went further. It
considered a COmDletely different issue, one that required not one but
several findings of fact, lncludlng (a) when O.D.C. knew about Cahoon’s
misconduct, (b) what it knew, (c) why it did not act on the information,
and (d) when it should have acted on it, i.e. what was a “reasonable” deiay,
in order to establish a factual basis for a finding~of negligence. Even more
remarkably, in order to do this Be Board had to relv on the evidence it had
previouslv dlsreaarded. It did so and held not Only that the employer was
negllgent but that the delay was “Inordinate”.
The devtce of assuming that the non-suit should not have been
granted did not conceal ‘the fact that all of these findings of fact were
made In the course of considering the non-SUlt motion. As I have
previously observed, that Is improper. It seems to me to be equally
,..,‘.; . . \ Improper, and blatantly illogical, to rest those findings on evidence that
I . . . had been previously dlsregarded.
Having granting the non-suit on one ground, the absence of adequate
cause, the Board proceeded to deal with another issue, delay, as If the
non-suit had not been granted and the case had run its normal course. By
Its non-suit, the Board prevented the admission of any further evidence,
either on behalf of Cahoon, or by the employer in reply. What the Board
did, in effect, was to add another ground for the non-suit.
I do not think that one can grant a non-suit and then go on and decide
i’ other ISSUeS arising In the case as if it had not been granted~. The non-
Suit brought, or should have brought, the proceedings to a halts It
26
undoubtedly, changed the course of the proceedings by fOfeClOSin!j the
introduction Of other evidence. In my respectful Opinion, ,Once a non-Suit
is granted ther.e is nothing more to consider.
There is another aspect of this exercise that I find illogical and
contradictory. The.Board said (at page 9 of the Supplementary reasons),
‘Following the Cheektowaga arrest In November of 1984i the
Employer was justjfled in suspending the grievor without pay, for a
.reasonable period of time, pending an investigation However, there was
no justification for the continuance of that suspension beyond June~ I,
1985. By that date, a final disciplinary .decisionshould have. been made,
or, alternatfvelv. the arlevor should have been reinstated to. full
emplovment Accordingly, we find that the grievor is entitled to damages
as of June 1, 1985.” (emphasis added)
What concerns me is that the board later held, ‘in the course of
considering an appropriate “penalty”, that th )
m Penalizing the employer for failing to do,something it could
not do seems to me to be patently illogical and basically unfair.
In its first award the Board commented that the issue of an
appropriate remedy was difficult This reflected its view that while
relnstatement would have been the normal remedy Cahoon, by his own
frauds, had disentltled hlmseif to It. Having observed, (at p.27) ihat
“Compensatlon ls, of course, a’dlscretionary matter” the Board adopted the
fOllOWhg Passage from Brown and Beatty, “Canadian I abour Arbitration.”
(2ndedltion):
Unless the. agreement provioes otherwise,
generally, in assessing damages arbitrators have
followed and utilized the same common-law principles >
27
that are applied In breach of contract cases~ Thus, the basic purpose of an award of damages 1.5 to put the aggrieved party in the same position he would have been
In had there been no breach of the CollectWe agreement.
As stated by one arbitrator:
‘Stated in the abstract, the
relevant principle 1s quite clear. The
purpose of damages for breach of
Contract 1s not to punish but to
compensate, and the function of
compensation 1s to place the aggrieved
party in a monetary position as near as
possible to that in which he would have
been had the contract been Performed.’
This appears to mean that while the power to award damages
is discretionary, the discretion is to be exercised in accordance with
common law principles governing an award of damages in a civil actlon for
breach of contract. One of thoSe principles was that damages must not to
be awarded as a penalty. An examination of their reasons discloses that
the Boardthenproceededtoignorethese precepts. Even though they found
It “aistasteful”, the majority Clearly felt bound t0 award damages and
abandoned their discretion, More importantly, their award \Nas really
punisnment of the employer for its “inordinate delay” rather than
WStOfatiOn t0 the grievor what he had 109
The Board was firm in the view that reinstatement was out of the
question. Thus,
In the absence of just cause for dismissal, the usual remedy is remstatement with full compensation for all
lost wages and beneflts~ Having regard to the Grlevor’s
two Subsequent Criminal convictions, reinstatement
would be a totally inappropriate remedy. A loans officer
employed by O~DC iS in a position of trust Dy virtue of hlS
positlon in the administratlon of public funds As
subsequent events have established, the Grievor has tommltted two serious criminal offences against the
28
,
interests’ of his employer, The Grievor’s .conduct ,iS
simply Incompatible with the fiduciary responsibllit,y
expected of the position of a loans officer. Accordingly,
he will not be reinstated.
The more troublesome aspect Of’ this cases iS the
issue of entitlement to and quantum of compensation. For
the time being, we reserve on the issue of compensation.
(first reasons, ~26-7) ***.
Board’s of Arbitration are understandably RlUCtant
to deny reinstatement in circumstances where just cause
has not been established. In fact, reinstatement .is denied
only in unusual circumstances. However, in our Opinion,
these two separate incidents of major misconduct by the
grievor have persuaded us that there was Simply no
possibility of any viable continuing employment
relationship.(supplementary reasons, p.4)
The employer‘s posltlon was that by electing to’call no eVldenCe the
grievor had disentitl,ed himself to any damages. In the course of
considering this argument the Board reviewed arbitrators’ decisions
Including, ,re Metropolitan Toronto Poafd of C*tnfnisSro*& .of Pollee and
Metropo/ifan 7ofonto Pobce Association ( 19771, 14 L.A.C.(2d), 1 and fe
Motor Transport /ndusrftM Relatkms Bureau of Ontafro and General Truck
DriWfS Union, 4 L.A.C. (2d) 154, which appeared to differ. They alSO relied
on the decision of the Supreme Court of ,Canada in RN Deer Co//ege K
/Whae/s eta1 ( 1975). 57 D.L.R.t3d) 386. The Board rejected the argument
that damages Should not be awarded, or even Considered. The Board Said,.
The purpose of a damages award is to compensate in
monetary terms for loss suffered because of a breach of
the collective agreement: The authority to awar-d’
damages is remedial in nature and does not involve any ~
punitive component.
The Board is satisfied that a damages award’is an
appropriate remedy in these particular circum.stances. An
award in favour of the grievor is based on lost wages and.
benefits as a result .of a breach of the employment
29
contract. From the standpoint of labour relations, damages should flow for the period of the improper
suspension, the dismissal Without just cause and the
Board’s decision not to reinstate the grievor. We would
agree with the Union contention that it makes no Claim to
equitable relief. Rather, the issue before us is the proper
exercise of the Board’s remedial authority~ The primary
effect of the post-discharge evidence of two guilty Pleas
was to disentitle the grlevor to reinstatement - the
normal remedy In the absence of just cause for diSmiSSal
Following the Cheektowaga arrest in November of
1984, the Employer was justified in suspendmg the
grievor without pay, for a reasonable period Of time,
pending an investigation. However, there was no
justification for the continuance of that suspension
beyond June 1, 1985. By that date, a final disciplinary
decision should have been made, or alternatively, the
grlevor should have been reinstated to full employment.
Accordingly, we find that the grievor is entitled to
damages as of June 1, 1985. (supplementary reasons,
pp.8- IO) ***
However, in the particular circumstances of this
case, the Board is not persuaded that the grievor is
entitled to damages to the date of the Decision or the
date of the Supplementary Decision. We cannot agree that
the grievor should receive general damages following his
second guilty plea on December 3, 1986 - the date he
pleaded guilty to defrauding the Ontario Development
Corporation. To award general damages after the second
conviction, we think, would be unconscionable.
The evidence established that the grievor had been
employed with O.D.C. since 1981. His salary at all
relevant times was in the $50,000.00 range. We find that
the grievor is entitled to additional damages in lieu of
reinstatement. In our opinion, nine months salary by way
of additional damages is an appropriate award.
The Board then went on to affirm its authority to award interests
Does a non-suit disentitle a arievor from damaaes?
The Board held that the Grievor was entitled to claim damages
30
notwithstanding the non-suit. This was obvious error. As already
observed, no matter of fact was open to be determined on the mOtiOn:
NadlerK Cnorni/ fsupra) Moreover, in going onto determine damages~the
Board had to depend on evidence they.had previously disregarded. They had
held that the employer had failed to establish adequate cause for
dismissal. They then proceeded to calculate compensation. They held, in
effect, Cahoon’s loss could be established without any proof from Cahoon
or any witness on his behalf that he had in fact suffered any loss at all
and without any evidence of mitigation. The damages were “readjly
discernable” and needed no “special proof”. This process of reasoning
agafn’ demonstrates fundamental misunderstandings of both the law and
the role they were called upon to play in applying it.
A Claim for damagqs for wrongful dismissal, like any other,claim for
damages, is for loss actually suffered. Few ,legal propositions are better
established than that there is no damage without injury. This rule is
subject to exceptions where Penalties are imposed:on a wrongdoer as
censure, such as punitive and exemplary “damages”. But those are not
damages in the sense that the term is.used here. What is under Uiscussion
iS damages for injury, and the so-called exc.eptions do not affect the
principle that damages are not awarded for injury unless injury is proven.)
Other principles established beyond question are that the onus of
proving damages is on the person claiming them; that damages ‘are
‘measured by the loss actually suffered; and that there is a duty on a
claimant to mitigate, for there Is no entitlement to compensatron for
“avoidable loss”. Thus, ln a civil action for damages for breach of contract
or wrongful dlsmlssal~ the onus of proving the actual loss is on the
Plaintiff, who has the carriage of the action. All of these propositions are
31
Illustrated In RedDeerCol/egp y: MiCA?PlS et a,! (.SUQQ at Pp.390-3910
m Laskin CJ.C. for the Court,
i
i
i.
I
It is, of course, for a wronged plaintiff to prove his
damages, and there is therefore a, burden upon him to
establish on a balance of probabilities what his loss IS.
The parameters of loss are governed by legal PrinClPle.
The primary rule in breach of contract cases, that a
wronged plaintiff is entitled to be put in as good a
position as he would have been in if there had been proper
performance by the defendant, iS Subject t0 the
qualification that the defendant cannot be called Won to
pay for avoidable losses which would result in an
increase in the quantum of damages payable to the
plaintiff. The reference in the case law to a “duty” to
mitigate should be understood in this sense.
In short, a wronged plaintiff is entitled to recover
damages for the losses he has suffered but the extent of
those losses may depend on whether he has taken
reasonable steps to avoid their unreasonable
accumulation. In P~G?Q L to’ y. Saunders [I91 91 2 K.B~
581 at p.589, Scrutton, L.J., explained tne matter in this
way:
Whether it be more correct to say that a
plaintiff must minimize his damages, or to say
that he can recover no more than he would have ~.‘Z suffered if he had acted reasonably, because any , \,, further damages do no reasonably follow from the
defendant’s breach, the result is the same.
Tnus, in a civil claim the employee plaintiff would have to meet the
‘onus of proving his actual loss In the course of doing so he lays himself
open to challenge on the ground that he is claiming avoidable losses which
he should have avoided by mitigation. His evidence and that called on his
behalf is open to cross-examination and, where proper, evidence in reply~
Laskin, C.J.C. went on to observe (emphasis added),
jn the ordinary course of litigation resoecting
Bronaful dismm, a plaintlff, In offering proof Of
32
P, f
i
damages, would lead evidence respecting the loss he
claims to have suffered by reason of the aismiSSa1. He
may have obtalneci other employment at a lesser or
greater remuneration than before and this fact would
have a bearing on his damages. He may not have obtained
otheremployment,anUthe question whether he has stood
idly or unreasonably by, or has tried without success to
obtain other employment would be part of the case on
damages. If it is the defendant’s posftion that the
‘plaintiff could reasonably have avoided some part of the
loss claimed, it is for the defendant to carry the burden
of that issue, subject to the .defendant being content t,o
allow the matter to be disposed of on the trial Judge’s
assessment of the plaintiff’s evidence on avordable
consequences.
The authority of ff&DeW is beyond question. Thus, while there is a
duty on a plaintiff in a civil action to take reasonable steps to mitfgate,
the onus of showing that he has not done so is on the defendant. It is no
doubt open to a defendant to choose not to raise the issue of mitigation. A,
case may turn, and turn heavily, on the issue of mitigation, but there is no
&Ly to’raise it. In the kind of case referred to by Chief Justice Laskin as
one in “the ordinary course of litigation”, the fulf.ilment of the plaintiff’s
duty to mitigate is challenged by the defendant,, who has the onus and the
opportunity of proving that he has not done so. ,To fault a party for not
proving failure to mitigate when that party has had no opportunity of
doing so is not just unfair, it is wrong.
Two things must occur. First, plaintiff must offer proof of his .
actual loss in order to meet the onus oi proving it on a balance of
probabilities. Second, defendant must have the opportunity of proving that
plaintiff has failed in his’duty to mitigate. ~
Nelther occurred here. The non-suit prevented the ‘employee from
proving his actual loss and the employer from challenging it. In observing
33
.
i \-
I-
that “the onus in failure to mitigate damages rests with the Employer
and quoting R&Y&@ as Its text, the Board reveals a fundamen2a;
misunderstanding of that decision. It wholly ignored the difference
between the procedure followed in “ordinary litigation” and that aCJODteU
by the Board In thls case If RedDeer had been correctly applied the
Board would not have gone on to consider damages at all.
The result was serious. It left the employer ham-strung on a Vital
issue, and led the Board to set damages without proof, for the eViUenCe led
by the employer did not prove Cahoon’s loss.
The point had already been dealt with fully and correctly In the
arbltratfon award the Board rejected: re Motor Tfa?sPorC /ncksffi3l
Relations Bureau or Ontaft and Gene@/ Truck Drivers' Union Lwpra,!
There a non-suit motion succeeded. The grievance was allowed and the
grlevor relnstated. The griever hau given no evidence of loss or
mltigatlon. On a contlnuatlon of the hearing convened to consider the
Issue of damages, the Board, by a majorlty, said,
Havlng completed the company’s evidence, the union then
elected not to call any evidence on behalf of the griever and in
effect argued a “non-suit”. While the lnltlal onus on the merits
is placed on the company, the onus to establish loss is clearly
on the person so claiming. There must be some substantial
evidence offered, in order to establish a loss along with which
Claim is the requirement to establish that the grievor had
taken StePS to mltlgate hls loss. As tne grlevor did not testify, his evidence could not be tested at all with regard to
damages or the merl ts.
The Union had agreed with that proposition but requested an
Opportunity to furnish Proof of 10s~~ The majority said, (pp. 158-g)
The unlon does not dlsagree that evidence must be
34
submltted to establish loss’, but it. submits that the
board should allow the grievor a further OPPOrtUnity at a
new, hearing to put in evidence relating to loss only. KYY
Counsel for the grievor who is experienced in these
matters and who took a considered and deliberate
approach advised the board at that time that he was not
calling any evidence and thereupon the board proceeded
with the submlsstons of counsel on the~fssues and on the
evidence then before the board. The company may have
been prejudiced by not having an opportunity to cross-
examfne the grievor on the merlts and loss and of course
tf ,the grievor had been called to testify he could have
been examined on any relevant facts in issue. By elecflng
not to put any evidence in, the union In effect denled to
the company, that avenue of examination which evidence
might have affected the result of the grievance.
Once the election is made that the evidence which
has been called by one party is the entire evidence before
the tribunal, then it must be complete for all of the ’
issues which without agreement, cannot later be
separated after the decision on the evidence has been
made. While the board has said in its prior award that
the ,grievor was not required to testify and that fact
could not be held against him on the merits, he is not In a ‘.
position to constitute the grievance claim ds a separate
issue for which no evidence of any one was offered to the
board. In the words of Professor Palmer referred to
above “no damages are shown and none are awarded”. ***
For all of the foregolng reasons we ffnd that ~the
grlevor 1s not entitled to a further hearlng of thls board
to submit evidence of his loss, if any. We further find
that In the absence of any evtdence before us, as to the
grievor’s loss and mitigation thereof, the board
dismisses the grlevor’s claim in that regard.
The Board rejected that decision, in favour of another arbitrator’s
decision in which the employee had~ testified: re MetfoPotitan Toronto
L
Board ol/ Commlsslbners of PO/&, ( supral In ,my respectful ‘opinion that ! I
I
35
36
. . -.
decision is wholly distinguishable. As the arbitrator said in that case, in
reference to the deClSiOn in re Motor &~s’of~, “...I am dealing with a
different situation.” The employee having testified, the employer hao an
opportunity to put mitlgation in issue and to cross-examine the grievor on
the evidence of loss on the record, such as it was. The employer chose not
to do so. There is no equivalence between that case and this. The
arbitrator’s disagreement with the decision in the M?tof Tfawoft case
1 was gratuitous. Even so, in my opinion, they were wrong
Damaaes
The union’s case was that the grievor was entitled to (1)
compensation for delay from June 1, 1985, to the date of the
supplementary award, (2) nine months additional damages in lieu of
reinstatement, and (3) interest.
Far
Perhaps the most striking aspect of the damages award iS that it
-; ,. required the Board again to repudiate its earller finding that the employer
, ‘i did not have adequate grounds for dismissal. In order to Calculate the
amount of compensation the Board thought Cahoon was entitled to for the
“inordinate delay” he had suffered the Board had to decide when he should
have been dismissed. That involved finding when it was that the employer
had had adequate grounds for dismissal. That was not going to be easy in
light of the finding that no such grounds had been proved. The Board got
around the problem by way of a fallacy. They adopted the device of
“assuming” that the grounds existed, having made a positive finding that
they did not. They then used that assumption as a basis for further
.- POSitWe findings of inordinate delay, the length of that delay, and the
damages it caused. In my opinion, this piocess of reasoning is fata.liy
erroneous.
It is patent that there was no sfmple “assumption” here; there was a
positive finding of fact, Calling it an assumption does not, distract from
its real nature. It was a finding oft fact.made on a non-sujt motion and
therefore bad. It was a finding based on evidence that had been previously
rejected. Moreover, it was not a finding on a sfde issue, it, was a finding
on “the merits”. Indeed, it Uealt with the very heart of the claim.
The Board simply assumed that Cahoon had lost the wages and
benef~its that he would oth~erwise have received. The Board Said,
“The Grieuor’s damages are reactfly discernahle
(sic) and require no special proof. It is simply a case of
lost wages and benefits which can be properly addressed
in final submissions.” (p.7, supplementary reasons).
***
Havlng set tne date from wnicn the loss commencea as tne begmnlng
of tne suspenslon wlthout pay the Board set about calculattng the period
of loss. Cahoon’s counsel had suggestea the date.~of the Wplementary
decision. The Boara said
However, in the particular circumstances of this
case, the Board is not persuaded that the grievor iS
entitled to damages to the date of the Decision or the date of tne Supplementary Decision. We, cannot agree
that the grievor should receive .general damages
following his second guilty plea on December 3, 1986 -
the date he pleaded guilty to defrauding the Ontario
Development Corporation. To award general damages,
after the second conviction, we think, would be
unconscionable.
,
Why a grant of damages after the second guilty plea would be
37 . ..” ~
unconscionable, or more unconscionable, than after the first, wa.s not .”
;.’ df an actual and calculabie 1ossThis~fdnfusion m,ight have contr’ibu~ed to ,1
:,:... its erroneoustreatment (&the. claim. ~. ‘. . <.’ ~.,_ : ; In any event,, the Board set the ,amount~‘df compensation, for’ delay by .,.
hardship. A dlsmtssed employee may ,through.reasonable diligence. find i ,. \.. better employment:and end up better off financially. The dismissal might
have been wrongful, but cause na loss. No entitlement to damages woulG
arise. Similarly,, new empjoyment might diminish the amount of
prospective loss. ., -,~ , ., ~‘, “, y;My:j;;~~ fc ;y. _ ::~‘~..,.; f It::~is. foi::ih~,se:,rea~:o[lsifh8t,;,a~clai~~~-..iddmages~j~c,!udes:,the ::tssue,;:,.,:~~‘-,.,,:.::-:
of mltigation.
The con5equenc.e of the non-suit was that no evidence .was offered
by or received, from Cahoon ‘or anyone on hls’behalf -to show’how he had . .
been injured by the suspension or dismissal, or what steps he had taken to I
L.. mitigate his injury. There was nothing for the, Board to ‘go on &it the
.:~ . . .,18 ,.
dates of the suspensions and of the dismissal, and Cahoon’s ear?ingS rate.,
The Board simply took the bare figures and calculated the loss aS if
it had in fact occurred. ,This was nothing more than conjecture. While the
figures the Board adopted might have represented the outside limits,of the
loss Cahoon could have claimed, there was no evidence that he had in fact
suffered it. The Board did not know whether he had or had not.
The onus on Cahoon was to prove his l,oss on the balance of
probabilities. There was nothing before the Board on which they could
rest a finding that he.had lost anything. The statistics on which the Board
rested its award ;if it was “evidence” at all, fell far short of proof.
Ironically, the evidence suggested that such a loss was unlikely. It
was shown that Cahoon was not confined to his income from his
employment with O.D.C. He had been involved in two business ventures
outside that employment. One of these was the Four Aces Racing Stable.
The other was National Aquarium Warehouse. That evidence of
~entrepreneurship might have ,ied the Board at least to wonder if the
suspension and dismissal had the effect they assumed it had.
i’:. :?-: <: Damages in lieu of reinstatement
The second head of damages was the Grievor’s claim to be entitled to
compensation for the fact that he could t-tot be reinstated. Under this head
he claimed 9 months salary and benefits. We were not informed of the
reason for choosing 9 months instead of some Other figure.
The Board accepted this claim. It said: .
The evidence established’ that the griever had been employed With O.D.C. since 1981, His salary at all
relevant times was in the $50,000.00 range.- We find
i? that the grievor is entitled to additional damages in lieu
i.2 of reinstatement. In our opinion, nine months salary by
39
This is clearly an award of general damages. The Board had
acknowledged tnat there was no claim for “equitable relief”. Perhaps that
1s why the Eoard chose to Call this award “additional aamages”. What
“additional damages” are I do not know, nor do I understand how they
differ from general aamages. In my opinion, the Board awarded equitable
relief under the guise of additional damages, for there was clearly no
legal basis for the award. No reason or rationale was given other than
that Cahoon was “entitled” to It. No reason or ratiOnale was given for
selecttng nlne months as the measure of lt. The flgure appears to have
been plucked out of the air. Tne only rationale apparent 1s tne statement
tnat the “arbltral furlSprUdenCe” was tnere to be followed. In the absence
of any proof of actual loss the award amounts to nothing more tnan a
penaity.
The Board appeared to agree with the Grievor’s claim to be “entitled”
to damages in lieu of reinstatement. Given that CahoOn disentitled
.<.. himself from reinstatement by his own fraudsit is hard to understand
i..: how he could be viewed as entitled to anything at all on this ground
The Board was under no compunction ,to award damages In
purporting to apply common-law principles it appears to have overlooked
the fundamental principle tnat one may not profit from one’s own wrongful
act. In my opinion, an award of damages in lieu of reinstatement in the
Circumstances of this case could not properly have been made in a civil
action In the courts for breach of contract or wrongful dismlssal~ One
WhO injures himself through his own Uellberate act has no Clalm agalnst
another. Indeed, such a claim would reaaily be branded fraudulent.
I . ., The Board appears not to have been familiar with the basis on which
way of additIOnal damages is an appropriate award
40
damages are dealt with at law. They gave no apparent consideration to the
effect, in terms of delay, of Cahoon’s private proclamation to O.D.C.
employees of his innocence, and the position he made Clear through
counsel that he “denied everything and admitted nothing”, even though they
found that this stance had left the employer “to its own resources to
investigate the alleged misconduct”. With respect, this conduct could
have had no other consequence than delay. The Board appeared to be less
concerned over Cahoon’s intransigence than the fact that his employer had
not-asked him to offer an explanation. Given that he “denied everything
and admitted nothing” that would appear a useless exercise. What
explanation they might have expected to get from one who on the evidence
is both a liar and a cheat can be imagined.
The dismissal letter expressly stated, “You have continuously
refused to confirm or deny to your employer your participation in either of
these incidents. This has caused your employer to incur considerable
additional expense and effort to investigate your conduct.” Since that was
directly in issue the Board might have found it worth considering, given
their willingness to consider other matters outside the non-suit itself.
What the Grievor was really complaining about was that he was not
dismissed sooner. How anyone can reasonably expect compensation for not
having been dismissed sooner when his own fraud was the cause for his
dismissal and when his refusal to cooperate in the ensuing investigation
could have no other effect than delay is simply beyond my comprehension.
I accept that the Board’s power to award compensation is
discretionary. The majority purported to apply legal principles. What
troubles me is that they appear to have given no consideration to factors .: I
that in my opinion would have led a court to deny any compensation at,all
41
The dissenting member had a firmer grasp of the relevant
conslderatlons. He summed up the essence of the case In a few words. He
sald, “The employers intention had obviously been to wait for the Court
decisions before proceeding with flnal disciplinary action. To argue now
that the Employer did not have just cause in June, 1986 is not logical~”
And further, “So, by his own actions, the grievor was suspended and
dismissed and did not at any time attempt any explanation. Perhaps this
is not strange as there does not seem to be any logical explanation.... As a
consequence...we Should not be considering damages of any kind...”
I agree with that, I think it expresses the correct application of the
legal principles the majority XknOWledged should govern, and how the
majority should have applied them. Had they done so, the result would
nave been “no damages of any kind”.
In the WSUlt, In my opinion, the award is so riddled with error that
It must not be allowed to stand. Mr. Paliare reminded us that we could
not, on judicial revfew, consider the merits. I accept that. If this award
had been free of serious error of law it would have to stand whatever I
might think of the justice of the result, In my opinion, it is fundamentally
flawed. Almost any one of the errors taken alone goes to the heart of the
Board’s exercise of jurisdiction. Taken together, they are overwhelming.
Without these errors this tribunal could not have made this award.
Whatever standard of review is adopted I think this award should be
quashed. In my respectful oplnlon, It 1s both patently unreasonable’ and
wrong. The errors were fundamental; they were not merely “withln
jurlsdlction”, they destroyed jurisdiction. The Board falled to carry out
its mandate. Justice requires intervention.
42
I would quash this award. In light of the alarming protraction of the
Droceedln~gs lt would be inappropriate to remit the matter to a differently
constituted board for rehearing.