Cherubini Metal Works Ltd. v. United Steelworkers of America, Local 4122, (2011) 304 N.S.R.(2d) 97 (SC)

• Judge: LeBlanc, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: November 03, 2010
• Jurisdiction: Nova Scotia
• Citations: (2011), 304 N.S.R.(2d) 97 (SC);2011 NSSC 94

Cherubini Metal v. USWA (2011), 304 N.S.R.(2d) 97 (SC);

    960 A.P.R. 97

MLB headnote and full text

Temp. Cite: [2011] N.S.R.(2d) TBEd. MY.044

Cherubini Metal Works Limited (applicant) v. The United Steelworkers of America, The United Steelworkers of America, Local 4122 (respondents)

(Hfx. No. 297596; 2011 NSSC 94)

Indexed As: Cherubini Metal Works Ltd. v. United Steelworkers of America, Local 4122

Nova Scotia Supreme Court

LeBlanc, J.

March 4, 2011.

Summary:

A union local filed numerous grievances against Amherst Fabricators (now Cherubini), which operated a steel fabrication plant. The Attorney General (Department of Labour (DOL) inspectors) issued compliance orders under the Occupational Health and Safety Act. Cherubini closed the plant. Cherubini sued the Attorney General, the national union and the union local for its losses, alleging negligence, conspiracy, discrimination, and intentional interference with Cherubini's economic interests. The national and local unions applied for summary judgment dismissing the claim, submitting that the issues in dispute arose out of the collective agreement and were within the exclusive jurisdiction of an arbitrator under the grievance and arbitration process, that the issues raised in Cherubini's claim were settled by binding mediation or arbitration, that the national and local unions did not owe a duty of care, and the civil conspiracy action should be dismissed because it should not be extended to the fact situation in this case.

The Nova Scotia Supreme Court, in a judgment reported (2006), 246 N.S.R.(2d) 283; 789 A.P.R. 283, dismissed the application, denying summary judgment. The dispute did not arise out of the collective agreement and, in any event, the collective agreement arbitration process did not provide an effective remedy. The issues raised were not dealt with by mediation or arbitration. A prima facie duty of care arose. It was not for the court, on a summary judgment application, to determine the extent of the application of the law of civil conspiracy. The national and local unions appealed.

The Nova Scotia Court of Appeal, in a judgment reported (2007), 253 N.S.R.(2d) 144; 807 A.P.R. 144, allowed the appeal and granted summary judgment dismissing the actions as against the national and local unions. The claims against the national and local unions, in their essential character, arose out of the collective agreement and fell within the exclusive jurisdiction of the grievance and arbitration process under the Trade Union Act and the collective agreement. The action against the Attorney General was subsequently dismissed (See (2009), 285 N.S.R.(2d) 255; 905 A.P.R. 255). That decision was affirmed on appeal (See (2011), 302 N.S.R.(2d) 367; 955 A.P.R. 367). Preliminary issues arose in the arbitration/ grievance proceedings between Cherubini and the national and local unions. The national union objected to being joined as a party to the grievance, as the Court of Appeal had already ruled that it was not a party to the collective agreement. The union local submitted that its claim that the grievance was not filed in time should be dealt with before the merits. The arbitrator ruled that (1) the national union was not a party to the collective agreement and should not have been joined and (2) that the issue of whether the grievance was filed out of time, and therefore not arbitrable, was to be heard before the grievance was heard on the merits. Cherubini applied for judicial review.

The Nova Scotia Supreme Court dismissed the application. The decision to bifurcate the proceeding was a reasonable exercise of the arbitrator's discretion. The finding that the national union was not a party to the collective agreement, which was based on a correct application of issue estoppel, was reasonable.

Administrative Law - Topic 3202

Judicial review - General - Scope or standard of review - The Nova Scotia Supreme Court held that an arbitrator's ruling that issue estoppel applied to require him to find that a national union was not a party to a collective agreement between the employer and the union local was subject to the correctness standard of review - If issue estoppel did not apply, the arbitrator's finding that the national union was not a party to the collective agreement was one of mixed fact and law and subject to the reasonableness standard of review - Likewise, the arbitrator's discretionary decision to bifurcate the proceedings, to hear the preliminary issue of arbitrability prior to hearing the grievance on the merits, was subject to review on the reasonableness standard - See paragraphs 37 to 51.

Courts - Topic 10

Stare decisis - Authority of judicial decisions - General principles - What constitutes obiter dictum - [See Estoppel - Topic 383 ].

Estoppel - Topic 383

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - In arbitration proceedings - An employer commenced a civil action against, inter alia, a national union and union local - The Court of Appeal granted summary judgment dismissing the civil action, finding that the claims arose out of the collective agreement and fell within the exclusive jurisdiction of the grievance and arbitration process - In that decision, the Court of Appeal stated that the national union was not a party to the collective agreement between the employer and the union local - In the subsequent arbitration proceeding, the arbitrator ruled that issue estoppel applied; that the employer was bound by the Court of Appeal's final decision that the national union was not a party to the collective agreement - The arbitrator rejected the submission that the Court of Appeal's decision was non-binding obiter dicta - He held that he could not, by exercising his discretion, disregard the Court of Appeal's findings and that, in any event, on the facts, the national union was not a party to the collective agreement - The Nova Scotia Supreme Court dismissed the employer's judicial review application - The arbitrator was correct to apply issue estoppel - The same parties and issues were involved and the Court of Appeal's decision was final - The arbitrator did not err in refusing to exercise his discretion to overrule the finding of issue estoppel - The Court of Appeal's finding was not an unnecessary collateral decision - Although unnecessary to decide the issue, the court opined that the arbitrator's decision (without applying issue estoppel) that the national union was not a party to the collective agreement was a reasonable one - See paragraphs 60 to 94.

Estoppel - Topic 386

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - Issues decided in prior proceedings - [See Estoppel - Topic 383 ].

Estoppel - Topic 389

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - Collateral issues decided in prior proceedings - [See Estoppel - Topic 383 ].

Labour Law - Topic 6066

Industrial relations - Collective agreement - General - Parties - [See Estoppel - Topic 383 ].

Labour Law - Topic 7112

Industrial relations - Collective agreement - Enforcement - Arbitration - Judicial review - Scope of review - [See Administrative Law - Topic 3202 ].

Labour Law - Topic 7139

Industrial relations - Collective agreement - Enforcement - Arbitration - Grievances - Procedure - General - A union local raised a preliminary objection that the employer's grievance was not arbitrable because it was not filed in time - The arbitrator acceded to the union local's request to bifurcation to permit the issue of arbitrability to be determined before the grievance was heard on the merits - The parties had agreed that the arbitrator's discretionary decision was to be based on considerations of "fairness to the parties, and the practicality and economy of time" - The Nova Scotia Supreme Court dismissed the employer's judicial review application - The arbitrator's discretionary decision was reasonable - The arbitrator's reasoning process was "justifiable, intelligible and transparent" - The arbitrator gave coherent reasons as to why the advantages of bifurcation outweighed the disadvantages - His decision fell within the range of possible outcomes - See paragraphs 52 to 59.

Cases Noticed:

New Brunswick (Board of Management) v. Dunsmuir, [2008] 1 S.C.R. 190; 372 N.R. 1; 329 N.B.R.(2d) 1; 844 A.P.R. 1; 2008 SCC 9, refd to. [para. 23].

Khosa v. Canada (Minister of Citizenship and Immigration), [2009] 1 S.C.R. 339; 385 N.R. 206; 2009 SCC 12, refd to. [para. 25].

Amherst (Town) et al. v. Superintendent of Pensions (N.S.) (2008), 268 N.S.R.(2d) 339; 857 A.P.R. 339; 2008 CarswellNS 431; 2008 NSCA 74, leave to appeal dismissed (2009), 394 N.R. 400; 287 N.S.R.(2d) 400; 912 A.P.R. 400; 2009 CarswellNS 39 (S.C.C.), refd to. [para. 34].

Casino Nova Scotia v. Labour Relations Board (N.S.) et al. (2009), 273 N.S.R.(2d) 370; 872 A.P.R. 370; 2009 NSCA 4, refd to. [para. 35].

Maritime Paper Products Ltd. v. Communications, Energy and Paperworkers' Union, Local 1520 (2009), 278 N.S.R.(2d) 381; 886 A.P.R. 381; 2009 NSCA 60, refd to. [para. 36].

Toronto (City) v. Canadian Union of Public Employees, Local 79 et al., [2003] 3 S.C.R. 77; 311 N.R. 201; 179 O.A.C. 291; 2003 SCC 63, refd to. [para. 37].

Cape Breton (Regional Municipality) v. Canadian Union of Public Employees, Local 933 (2006), 245 N.S.R.(2d) 219; 777 A.P.R. 219; 2006 NSCA 80, refd to. [para. 40].

Dayco (Canada) Ltd. v. National Automobile Aerospace and Agricultural Implement Workers Union of Canada (CAW-Canada), [1993] 2 S.C.R. 230; 152 N.R. 1; 63 O.A.C. 1; 102 D.L.R.(4th) 609, refd to. [para. 41].

Halifax Employers Association v. International Longshoremen's Association, Local 269 (2004), 226 N.S.R.(2d) 159; 714 A.P.R. 159; 2004 NSCA 101, refd to. [para. 42].

Association of the Academic Staff of the University of Alberta et al. v. University of Alberta et al. (2002), 303 A.R. 363; 273 W.A.C. 363; 2002 ABCA 99, refd to. [para. 45].

Association of the Academic Staff of the University of Alberta et al. v. University of Alberta et al. (2006), 212 O.A.C. 131; 267 D.L.R.(4th) 509; 2006 CarswellOnt 2709 (C.A.), leave to appeal dismissed (2006), 361 N.R. 400; 228 O.A.C. 396; 2006 CarswellOnt 7214 (S.C.C.), refd to. [para. 46].

Ontario Public Service Employees Union v. Seneca College of Applied Arts & Technology - see Association of the Academic Staff of the University of Alberta et al. v. University of Alberta et al.

Toronto (City) v. Canadian Union of Public Employees, Local 79 (2004), 128 L.A.C.(4th) 217; 2004 CarswellOnt 4325 (Arb. Bd.), refd to. [para. 52].

Schenker Distribution v. Teamsters Local Union No. 31 (2004), 77 C.L.A.S. 386 (Arb.), refd to. [para. 55].

Hiram Walker & Sons Ltd. v. Distillery Workers, Local 61 (1973), 3 L.A.C.(2d) 203 (Arb.), refd to. [para. 57].

Danyluk v. Ainsworth Technologies Inc. et al., [2001] 2 S.C.R. 460; 272 N.R. 1; 149 O.A.C. 1; 2001 SCC 44, refd to. [para. 60].

Copage et al. v. Annapolis Valley Indian Band (2004), 228 N.S.R.(2d) 284; 723 A.P.R. 284; 2004 NSCA 147, refd to. [para. 60].

Angle v. Minister of National Revenue, [1975] 2 S.C.R. 248; 2 N.R. 397, refd to. [para. 61].

Weber v. Ontario Hydro, [1995] 2 S.C.R. 929; 183 N.R. 241; 82 O.A.C. 321, refd to. [para. 65].

Ashby v. McDougall Estate et al. (2005), 234 N.S.R.(2d) 162; 745 A.P.R. 162; 2005 NSSC 148, refd to. [para. 72].

Doucet-Boudreau et al. v. Nova Scotia (Minister of Education) et al., [2003] 3 S.C.R. 3; 312 N.R. 1; 218 N.S.R.(2d) 311; 687 A.P.R. 311; 2003 CarswellNS 375; 2003 SCC 62, refd to. [para. 73].

R. v. Zornes, [1923] S.C.R. 257; 1923 CarswellAlta 100, refd to. [para. 73].

Allen v. College of Dental Surgeons (B.C.) (2007), 236 B.C.A.C. 215; 390 W.A.C. 215; 2007 CarswellBC 232; 2007 BCCA 75, refd to. [para. 73].

Service Employees' International Union v. Elm Tree Nursing Home, [1978] O.L.R.B. Rep. 984, refd to. [para. 79].

Dryden Paper Co. v. United Paperworkers' Union, Locals 105 and 1323 (1976), 11 L.A.C.(2d) 337 (Ont.), refd to. [para. 79].

Aatlen v. Prince George Pulp and Paper Ltd. (1968), 69 D.L.R.(2d) 31 (B.C.S.C.), refd to. [para. 79].

Bisaillon v. Concordia University, [2006] 1 S.C.R. 666; 348 N.R. 201; 2006 SCC 19, refd to. [para. 83].

Limojet Gold Express Ltd. v. Public Service Alliance of Canada, Local 05/21081 (2006), 160 L.A.C.(4th) 314 (B.C. Arb.), disagreed with [para. 86].

Giorno v. Pappas et al. (1999), 117 O.A.C. 187; 170 D.L.R.(4th) 160 (C.A.), refd to. [para. 87].

Fullowka et al. v. Pinkerton's of Canada et al., [2010] 1 S.C.R. 132; 398 N.R. 20; 474 A.R. 1; 479 W.A.C. 1; 2010 SCC 5, refd to. [para. 91].

Counsel:

George MacDonald, Q.C., and Michelle Awad, Q.C., for the applicant;

Raymond Larkin, Q.C., and Bettina Quistgaard, for the respondent, United Steelworkers of America, Local 4122;

Robert Healey, for the respondent, United Steelworkers of America.

This application was heard on November 3, 2010, at Halifax, N.S., before LeBlanc, J., of the Nova Scotia Supreme Court, who delivered the following judgment on March 4, 2011.