550551 Ontario Ltd. et al. v. Framingham et al., (1991) 49 O.A.C. 376 (DC)

• Judge: Hartt, Montgomery and Carruthers, JJ.
• Court: Ontario Court of Justice General Division (Canada)
• Case Date: June 21, 1991
• Jurisdiction: Ontario
• Citations: (1991), 49 O.A.C. 376 (DC)

550551 Ont. Ltd. v. Framingham (1991), 49 O.A.C. 376 (DC)

MLB headnote and full text

550551 Ontario Limited, Bauhaus Designs Canada Limited, Bauhaus South Inc., National Chesterfield Frames Limited, Bauhaus America Inc., Kings-Wood Frames Mfg. Corporation and Martin Silver (applicants) v. R.R. Framingham, Penny Dutton, Director of Employment Standards and Minister of Labour for Ontario and the United Steelworkers of America

(No. 29/91)

Indexed As: 550551 Ontario Ltd. et al. v. Framingham et al.

Ontario Court of Justice

General Division

Divisional Court

Hartt, Montgomery and Carruthers, JJ.

June 21, 1991.

Summary:

Bilt-Rite Upholstering Co. filed an assign­ment in bankruptcy, putting over 400 employees out of work. The Employment Standards Branch of the Ontario Ministry of Labour issued an "order to pay" against the applicants pursuant to s. 47 of the Employ­ment Standards Act. The "order to pay" required the applicants to pay forthwith to the Director of Employment Standards in trust, unpaid wages, vacation pay, termina­tion and severance pay plus a penalty. Pur­- suant to s. 12 of the Act, Framingham, an employment standards officer, found all the applicants to be one "employer" of the former employees of Bilt-Rite and to be jointly and severally liable for the amounts owing. The applicants applied for judicial review of the "order to pay".

The Ontario Divisional Court allowed the application to the extent that the order to pay was quashed as it related to the individual applicant, Silver, who was the directing mind of the corporate applicants. Otherwise the order was to remain in force.

Master and Servant - Topic 8344

Employment and labour standards - Power of officer - Judicial review - Natural justice - Bilt-Rite went bankrupt, termi­nating numerous employees - An employ­ment standards officer investigated and considered that several related companies and an individual (the applicants) could be considered to be the "employer" (Employ­ment Standards Act, s. 12) - A letter was sent to the applicants, informing them of the officer's finding and arranging a meet­ing to discuss the issue - The officer issued an "order to pay" requiring the applicants to pay in trust, monies owing the employees for unpaid wages, vacation pay etc. - The applicants alleged a denial of natural justice because they were not given a full-scale hearing - The Ontario Divisional Court held that there was no denial of natural justice - See paragraphs 41 to 47.

Master and Servant - Topic 8344

Employment and labour standards - Power of officer - Judicial review - Bias - Bilt-Rite went bankrupt, terminating numerous employees - An employment standards officer investigated and considered that several related companies and an individ­ual (the applicants) could be considered to be the "employer" (Employment Standards Act, s. 12) - A letter was sent to the ap­plicants, informing them of the officer's finding and arranging a meeting to discuss the issue - The applicants alleged bias, because the officer had a preliminary view respecting who was the employer - The Ontario Divisional Court held that the mere holding of a preliminary view by the officer did not give rise to a reasonable apprehension of bias - See paragraphs 48 to 51.

Master and Servant - Topic 8353

Employment and labour standards - Powers of officer - Power re "order to pay" - [See first Master and Servant - Topic 8344 and all Master and Servant - Topic 8354 ].

Master and Servant - Topic 8354

Employment and labour standards - Powers of officer - Power to treat related parties as "employer" - Bilt-Rite Uphol­stering Co. went bankrupt, terminating numerous employees - Claims were filed under the Employment Standards Act - An employment standards officer determined that a numbered company was associated or related with Bilt-Rite such that the numbered company could be considered the "employer" within the meaning of the Act (s. 12) - The numbered company owned the manufacturing plant used by Bilt-Rite and the land thereunder, which it leased to Bilt-Rite for less than market value - The Ontario Divisional Court held that there was an adequate factual underpinning for the officer to make the decision pursuant to s. 12 - See para­graphs 59 to 62.

Master and Servant - Topic 8354

Employment and labour standards - Powers of officer - Power to treat related parties as "employer" - The Employment Standards Act, s. 12, permitted associated or related companies, individuals, associ­ations etc. to be considered as one "employer" for purposes of the Act - The Ontario Divisional Court held that there are two ways under the Act to arrive at a decision under s. 12 culminating in an "order to pay", and it is open to an em­ployment standards officer to adopt either path - See paragraphs 52 to 58.

Master and Servant - Topic 8354

Employment and labour standards - Powers of officer - Power to treat related parties as "employer" - The Employment Standards Act, s. 12, permitted associated or related companies, individuals, associ­ations etc. to be considered as one "employer" for purposes of the Act - The Ontario Divisional Court held that the word "individuals" in s. 12 related to sole proprietorships - Therefore, an employ­ment standards officer lacked the power to issue an order to pay against an individual in their personal capacity on the basis that the individual was an "employer" on the application of s. 12 of the Act - See para­graphs 63 to 65.

Master and Servant - Topic 8354

Employment and labour standards - Powers of officer - Power to treat related parties as "employer" - [See both Master and Servant - Topic 8344 ].

Words and Phrases

Individual - The Ontario Divisional Court held that the word "individual" in s. 12 of the Employment Standards Act, R.S.O. 1980, c. 137, related to a sole proprietor­ship - See paragraph 65.

Cases Noticed:

Downing and Graydon et al., Re (1978), 21 O.R.(2d) 292 (C.A.), refd to. [paras. 34, 42, 54].

W.D. Latimer Co. Ltd. and Bray, Re (1974), 6 O.R.(2d) 129 (C.A.), refd to. [para. 49].

Statutes Noticed:

Employment Standards Act, R.S.O. 1980, c. 137, sect. 1(d) [para. 40]; sect. 2(3) [para. 33]; sect. 12 [para. 2 et seq.]; sect. 45 [paras. 22, 32]; sect. 47 [paras. 1, 33, 35]; sect. 47(1) [paras. 36, 52 et seq.]; sect. 50 [paras. 35, 37, 68, 70]; sect. 50(1) [para. 67]; sect. 51 [paras. 35, 38, 52].

Counsel:

J.T. Morin, Q.C., and D.C. Rosenbaum, for the applicants;

R.P. Armstrong, Q.C., for all respondents except the Steelworkers Union;

H. Goldblatt, for the Steelworkers Union.

This application was heard on June 3, 4 and 5, 1991, before Hartt, Montgomery and Carruthers, JJ., of the Ontario Divisional Court. The following decision of the court was delivered by Montgomery, J., and released on June 21, 1991.