Ford Motor Company of Canada, Limited v. International Union, United Automobile Workers of America et al., [1972] SCR 625

Supreme Court of Canada

Ford Motor Company of Canada, Limited v. International Union, United Automobile Workers of America et al., [1972] S.C.R. 625.

Date: 1971-12-20

Ford Motor Company of Canada, Limited Appellant;

and

International Union, United Automobile Workers of America and J.F.W. Weatherill Respondents.

1971: November 15; 1971: December 20.

Present: Abbott, Judson, Spence, Pigeon and Laskin JJ.

MOTION TO QUASH

Appeal—Right of appeal to Supreme Court of Canada—Amount in controversy—Collective agreement between appellant company and respondent union—Arbitration award for payments to or for benefit of employees individually—Individual claims not within jurisdictional amount—Employer’s total obligations under award in excess of required dollar level—Whether appeal as of right—Supreme Court Act, R.S.C. 1970, c. S-19, s. 36.

Arbitration proceedings were initiated by the respondent union as a result of a difference of opinion between it and the appellant company on the effect of their collective agreement, in its provisions respecting health services insurance, considered in the light of the supervening force of The Health Services Insurance Act, 1968-69 (Ont.), c. 43. According to the union’s statement of grievance, the premiums payable by the company pursuant to the medical plan covered by the collective agreement were greater in amount than the premiums called for under the Ontario Hospital Services Insurance Plan. In consequence, the union contended that the company was obliged, under the provisions of s. 10(3) of The Health Services Insurance Act to pay the difference in the premium required for OHSIP coverage to or for the benefit of the employees, and in failing to do so was in violation of the Act. The union’s position was upheld by the arbitrator.

The company was unsuccessful both before the High Court of Ontario and the Ontario Court of Appeal in certiorari proceedings to quash the arbitration award. It appealed to this Court, invoking the right of appeal granted by s. 36 of the Supreme Court Act, R.S.C. 1970, c. S-19, as re-enacted by 1969-70 (Can.), c. 44 (1st Supp.), s. 1. The union moved to quash the company’s appeal on the grounds that (1) the denial of certiorari to quash

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was the result of an exercise of discretion, and hence no appeal lay because of the prohibition in s. 44 of the Supreme Court Act, and (2) there was no monetary sum involved or, if there was, it was a distributable sum among thousands of employees and in no case was any employee’s entitlement within the required dollar level under s. 36.

Held (Judson and Laskin JJ. dissenting): The motion to quash should be allowed.

Per Abbott, Spence and Pigeon JJ.: When several claims are joined in a judicial proceeding, the amount of each individual claim is the sum to be considered in deciding whether an appeal lies to this Court without special leave. This rule does not cease to apply when, as in this case, the separate individual claims arise under a collective agreement between an employer and a labour union.

The company’s obligations under the arbitrator’s award were for much more than the sum required under s. 36, but this award was not in favour of the union. It was for payments “to or for the benefit of the employees” individually. What was submitted to arbitration was a collective grievance involving thousands of individual claims each of which came nowhere near the jurisdictional amount. Throughout the arbitration and the subsequent court proceedings, the union was acting solely in a representative capacity, asserting no personal claim, only the individual claims of more than ten thousand employees. The adjudication was not as to its rights but as to those of the individual employees.

Per Judson and Laskin JJ., dissenting: There is a difference between individual entitlements which arise separately under individual employment relations and are pursued by action in that context, and individual entitlements which are dependent upon an a priori determination of collective agreement rights, realized through a union which, although it represents employees for that purpose collectively, properly takes arbitration proceedings in its own right.

The money entitlements, if any, of the individual employees could not be made the subject of an action for their recovery until it had been determined in arbitration proceedings that there was money owing to the employees. Once that was determined, there remained only the calculations. Hence, the

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challenge through certiorari to the interpretation given in the arbitration proceedings cannot be assimilated to an action brought by the union on behalf of thousands of employees, especially when the merits going to the entire obligation of the company could not be the subject of an action. On this view of the matter, the applicable principle was that expressed in Tonks v. Reid, [1965] S.C.R. 624, at p. 627, viz., the amount or value of the matter in controversy is the monetary loss which the appellant will suffer if the judgment in appeal is upheld. That loss was undeniably within the dollar limit under s. 36.

[La Duchesse Shoe Ltd. v. Le Comité Paritaire de l’Industrie de la Chaussure, [1941] S.C.R. 538, applied; Hamilton Street Railway Co. v. Northcott, [1967] S.C.R. 3; Tonks v. Reid, [1965] S.C.R. 624, distinguished; Le Comité Conjoint des Métiers de la Construction du District de Hull v. Canada China Clay & Silica Co. Ltd., [1945] 1 D.L.R. 255, referred to]

APPLICATION to quash an appeal from a judgment of the Court of Appeal for Ontario[1], dismissing an appeal from a judgment of Lacourciere J., whereby an application to quash an arbitration award was dismissed. Application granted, Judson and Laskin JJ. dissenting.

L.A. MacLean, for the appellant.

D.J.M. Brown, for the respondent Union.

The judgment of Abbott, Spence and Pigeon JJ. was delivered by

PIGEON J.—My brother Laskin has stated the facts of this case as to which there is no dispute. I am, however, unable to agree that on those facts it can be said that “the amount or value of the matter in controversy in the appeal exceeds ten thousand dollars”. Of course, it is clear that Ford’s obligations under the arbitrator’s award are for much more than that sum. But, this award is not in favour of the Union. It is for payments “to or for the benefit of the employees” individually. What was submitted to arbitration was a collective grievance involving thousands of individual claims each of which comes nowhere near the jurisdictional amount.

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Throughout the arbitration and the subsequent court proceedings, the Union has been acting solely in a representative capacity, asserting no personal claim, only the individual claims of more than ten thousand employees.

From this Court’s early days, it has been determined that when several claims are joined in a judicial proceeding, the amount of each individual claim is the sum to be considered in deciding whether an appeal lies to this Court without special leave. I cannot find any basis for holding that this rule ceases to be applicable when the separate individual claims arise under a collective agreement between an employer and a labour union. On the contrary, as I read it, the decision of this Court in La Duchesse Shoe Ltd. v. Le Comité Paritaire de l’Industrie de la Chaussure[2] is conclusive against such a view. The legislation under consideration in that case was originally entitled Collective Labour Agreements Extension Act, 1934 (Que.), c. 56. The 1937 re-enactment was entitled Workmen’s Wages Act, 1937 (Que.), c. 49, the 1940 re‑enactment, Collective Agreement Act, 1940 (Que.), c. 38. In spite of the changed title, its general nature remained the same at all times.

In Le Comité Conjoint des Métiers de la Construction du District de Hull v. Canada China Clay & Silica Co. Ltd.[3], Rinfret C.J.C. said (at p. 257):

It is now well settled that where a joint committee, claiming, on behalf and for the benefit of workers and apprentices, an amount alleged to be due as wages under a collective agreement, and also claiming under other provisions of the Act for sums payable to the committee itself as liquidated damages or as penalty, the jurisdiction of this Court is not to be established by the aggregate sum claimed on behalf of all the workers and apprentices, but that each individual claim by itself must be considered as separate for purposes of jurisdiction. (Cousins v. Harding, [1940] 3 D.L.R. 272, S.C.R. 442; La Duchesse Shoe Ltd. v. Le Comité Paritaire de l’In-

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dustrie de la Chaussure, [1941], 4 D.L.R. 480, S.C.R. 538). This rule has been followed ever since in this Court.

Kellock J. said (at p. 259):

Under the original legislation [Collective Labour Agreement Act], namely, 24 Geo. V., c. 56, as amended by 25-26 Geo. V., c. 64, it is provided by s. 2 that the Lieutenant-Governor in Council may order that a collective labour agreement made between employees and employers shall be binding upon all employers and employees in the same trade and industry. Section 7 provided that the parties to a collective labour agreement should form a “joint-committee” charged with supervising and the carrying out of the agreement. Such joint‑committee by sub-cl. (b) (as enacted by 1 Edw. VIII. (2nd Sess.), c. 24, s. 1) is authorized to exercise for the benefit of each of the employees all rights of action arising in their favour from a collective agreement without having to provide an assignment of claim from the persons concerned. By s-s. (4) (as enacted by 25-26 Geo. V., c. 64, s. 5) this joint‑committee is constituted a corporation and given the powers of an ordinary corporation for the purposes of the Act.

Although the parity committee under the Quebec Collective Agreement Act was legally authorized to sue for and to recover wage claims arising under an agreement made obligatory under that law and also entitled to join any number of such claims in a single suit, it was nevertheless held that the amount of each individual claim was to be considered as controlling for jurisdictional purposes in this Court. It seems to me that the same conclusion must obtain a fortiori when the bargaining agency initiating the proceedings is empowered only to litigate the exigibility of the claims, not to recover on them.

Concerning Hamilton Street Railway Co. v. Northcott[4], it should be noted that the case came to this Court by special leave granted to the employer against a judgment in favour of an employee. As in the present case, the Union had obtained a favourable decision from an arbitration board. This decision was only a declaration of entitlement, not an award of specific

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sums to the individual employees. The latter not being paid brought individual actions against the employer. It was held that they were entitled to recover. In my view, the essential part of Judson J.’s reasons is this paragraph (at pp. 5 and 6):

If one follows the company’s argument to its ultimate conclusion it means that no employee can ever sue for wages unpaid. He would have to follow the grievance procedure in the collective agreement and be bound by very stringent time limits. This would be so even though there is no dispute about the wages being due and owing. The collective agreement is not concerned with non-payment of wages. These may be sued for in the ordinary courts. If, however, the right to be paid depends upon the interpretation of the collective agreement, this is within the exclusive jurisdiction of a board of arbitration appointed under the agreement, but whether this decision comes under grievance procedure under art. VI, with the consequent registration of the equivalent of a judgment or a declaration at the instance of the union under art. VIII, makes no difference. In the one case the individual employees get the equivalent of judgments; in the other case, they have declarations of right on which they can sue.

(Emphasis added.)

From this it appears to me that the legal result of arbitration proceedings under a collective agreement is that each of the individual employees has a claim against the employer, not that the Union has one for the total sum. While the Union is a proper party to the arbitration proceedings and to subsequent proceedings in which the validity of the arbitration award is put in question, it is clear that it is such in a representative capacity, not for itself. The adjudication is not as to its rights but as to those of the individual employees. The fact that the validity of all those claims depends on the same issue, namely the construction of the collective agreement, does not make one claim of the whole number any more than in any other case in which the legal outcome of many individual claims depends on the same finding.

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As to the decision in Tonks v. Reid[5], it must be stressed that the issue was the validity of appellants’ title to a piece of land with buildings of a total value exceeding $30,000. Such is the context in which should be read the words “the amount or value of the matter in controversy is the loss which the appellant will suffer if the judgment in appeal is upheld.” In that case, the only question in respect of jurisdiction was whether an amount or value exceeding ten thousand dollars could be said to be involved in the proceedings. This was resolved in the affirmative considering that the controversy centred on the title to lands of a value in excess of that amount. No question arose as to the existence of a multiplicity of separate claims which is the only issue on the jurisdiction in the present case.

I would allow the motion to quash with costs.

The judgment of Judson and Laskin JJ. was delivered by

LASKIN J. (dissenting)—Ford Motor Company of Canada, Limited (hereinafter referred to as Ford) was unsuccessful both before the High Court of Ontario and the Ontario Court of Appeal in certiorari proceedings to quash an arbitration award. It has appealed to this Court, invoking the right of appeal granted by s. 36 of the Supreme Court Act, R.S.C. 1970, c. S-19, as re-enacted by 1969-70 (Can.), c. 44 (1st Supp.), s. 1. The other party to the arbitration proceedings, the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (hereinafter referred to as the Union), which successfully resisted the attack on the award in the Ontario Courts, has moved to quash Ford’s appeal on the grounds that (1) the denial of certiorari to quash was the result of an exercise of discretion, and hence no appeal lay because of the prohibition in s. 44 of the Supreme Court Act, and (2) there is no monetary sum involved or, if there is, it is a distributable sum among thousands of employees and in no case is any employee’s entitlement within the required dollar level under s. 36.

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Sections 36 and 44 of the Supreme Court Act read as follows:

36. Subject to sections 40 and 44, an appeal to the Supreme Court lies on a question that is not a question of fact alone, from a final judgment or a judgment granting a motion for a nonsuit or directing a new trial of the highest court of final resort in a province, or a judge thereof, pronounced in

(a) a judicial proceeding where the amount or value of the matter in controversy in the appeal exceeds ten thousand dollars, or

(b) proceedings for or upon a writ of habeas corpus or mandamus.

[Section 40, mentioned in s. 36 has no possible application here]

44. (1) No appeal lies to the Supreme Court from a judgment or order made in the exercise of judicial discretion except in proceedings in the nature of a suit or proceeding in equity originating elsewhere than in the Province of Quebec and except in mandamus proceedings.

The arbitration proceedings were initiated by the Union as a result of a difference of opinion between the parties on the effect of their collective agreement, in its provisions respecting health services insurance, considered in the light of the supervening force of The Health Services Insurance Act, 1968-69 (Ont.), c. 43. Under s. 25 of the Act, private health services insurance contracts were annulled as of October 1, 1969 in respect of persons covered by the Act. In respect of employees, s. 10(1) of the Act provides for deductions by employers from their employees9 renumeration of the premiums prescribed under the Act, or such part thereof as is agreed upon between employer and employee, but primary liability to pay rests upon the employee. Section 10 (2)(3), which is central to the monetary issue on this motion to quash, is as follows:

(2) Nothing in this Act shall be construed to affect any agreement or arrangement for contribution by an employer of all or any of the premiums payable for insurance in respect of his employees and any obligation of the employer thereunder to pay all or any part of the premium for insured health

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services continues in respect of the payment of the premium for insured health services under this Act.

(3) Where the amount required to be paid under an agreement referred to in subsection 2 by the employer as premium for insured health services, or the part of such amount that is referrable to insured health services, is greater than the amount the employer is, by virtue of subsection 2, required to pay in respect of the premium under this Act, the employer shall, until the agreement is terminated, pay the amount of the excess to or for the benefit of the employees and section 34 of The Labour Relations Act applies to differences arising in the application of this subsection in the same manner as to differences arising from the interpretation, application, administration or alleged violation of a collective agreement.

The collective agreement provisions for health services for employees covered thereunder stipulated in art. 29.02 that the entire cost would be paid by Ford, and that Ford “shall receive and retain any divisible surplus, credits or refunds or reimbursements under whatever name arising out of the Program”. The likelihood of a government plan of health insurance benefits was anticipated in the collective agreement by s. 7 of Appendix R, where the details of the Ford-Union benefit scheme were set out. Brieflly, s. 7 provided that if government-provided benefits exceeded those under the collective agreement scheme Ford might require employees to make the appropriate contributions for the excess benefits and that if the government-provided benefits were on a lower level, Ford, to the extent it finds it practicable, would provide supplementary benefits to correct the disparity.

Upon the introduction of the government plan under the Ontario Health Services Insurance Act, Ford and the Union differed on the effect of s. 10 in its bearing upon their collective agreement. In the result, the Union submitted to arbitration a grievance which it formulated in the following words:

The amount of premiums payable by the company pursuant to the medical plan covered by the collec-

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tive agreement (section 7 of the Hospital-Surgical-Medical-Drug Expense coverage, Appendix R, p. 289) are greater in amount than the premiums called for under the Ontario Hospital Services Insurance Plan. In consequence, the company is obliged, under the provisions of section 10(3) of the Health Services Insurance Act to pay the reduced difference in the premium required for OHSIP coverage to or for the benefit of the employees, and in failing to do so is in violation of The Health Services Insurance Act.

The Union therefore submits this dispute to arbitration in accordance with the provisions of section 10(3) of The Health Services Insurance Act.

An award sustaining the Union’s contention was issued by the single arbitrator on April 3, 1970. It was quashed on certiorari and the matter remitted to the arbitrator for reconsideration and redetermination by bringing art. 29 of the collective agreement into his calculations. This the arbitrator did, and he again upheld the Union’s position in an award dated November 3, 1970.

Three passages from this award have a bearing on this motion to quash. They are as follows:

(1) By article 29.04, the umpire as such would have no jurisdiction over any matter arising under the article, or under the insurance program. I agree with counsel for the company, however, (and counsel for the union did not take a contrary position) that my jurisdiction in this matter arises under section 10(3) of The Health Services Insurance Act, 1968-69. In the exercise of that jurisdiction it is necessary to make certain collateral determinations, including a determination as to the effect of article 29 of the collective agreement, and, I think, a determination as to the continuation of the employer’s obligation referred to in subsection (2) of section 10 of the Act. It is worth stressing, I think, that although the question for the arbitrator arises under section 10(3) of the Act, it is essential for him to determine what, if anything, is the amount required to be paid by an employer pursuant to subsection (2) of section 10.

(2) It is accordingly my award that the company has, since October 1, 1969, been under an obligation to pay to or for the benefit of the employees in question the amount of the difference between the premiums formerly payable, and those payable under The Health Services Insurance Act, 1968-69.

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(3) It may be that some difference may arise between the parties as to the manner or sufficiency of the payment “to or for the benefit of the employees”. I therefore note the agreement of the parties that I should remain seized of this matter for the purpose of determining any such difference.

Lacourciere J. dismissed an application to quash the award, being of opinion that Ford “has failed to satisfy the Court that the award on its face shows any defect of jurisdiction or contains any error in law sufficient to justify the extraordinary intervention by way of certiorari…. The construction placed on the relevant provisions of the agreement in the light of Section 10 of the Health Insurance Services Act and the interpretation of Section 10 itself are in accordance with constructions which the language will plainly and reasonably bear”. The Court of Appeal took substantially the same view in affirming the judgment of Lacourciere J.

Although there are situations where certiorari may be refused in the exercise of discretion, as that term is understood in s. 44 of the Supreme Court Act, the present case is not within them. Ford’s application failed because the Ontario Courts concluded that there had been no departure from the legal principles upon which labour arbitration awards may be quashed. The first ground upon which the motion to quash was founded accordingly fails.

Relevant to the second ground is the affidavit and an attached exhibit, marked “E”, filed by Ford on its application for certiorari. According to the affidavit, the exhibit was submitted to the arbitrator as an agreed statement of fact. It shows that more than 11,900 employees were covered by the health services plan under the collective agreement and that, ignoring differences in premiums according to single or married status, Ford’s overall monthly saving in premium costs under the government plan, as compared with the collective agreement plan, was about $27,000. The effect of the arbitration award was to make Ford liable to pay this monthly difference over the life of the collective agreement, as from October 1, 1969. The collective agreement, entered

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the Supreme Court of Ontario under s. 34(9) of the Labour Relations Act, then R.S.O. 1960, c. 202.

In giving the judgment of the Court in the Northcott case, Judson J. said (at p. 5) that “the union has been successful in getting the declaration favourable to the interpretation which would give the employees their money, but the arbitration board did not state in its reasons how much each was entitled to because they were not parties to the grievance procedure under art. VIII [in that case]”. This is similar to what happened here. Judson J. pointed out further that wages owing may be sued for in the ordinary courts; and he continued (at p. 5): “If, however, the right to be paid depends upon the interpretation of the collective agreement, this is within the exclusive jurisdiction of a board of arbitration appointed under the agreement…”. It seems to me plainly right that if at the point of a board of arbritation award a challenge by certiorari is made thereto, the amount of money involved in the award should be the touchstone of the application of s. 36 of the Supreme Court Act when an appeal is taken from the judgment of the provincial Court of Appeal. The collective agreement is, in the present case, the base upon which the monetary obligation of Ford under s. 10(3) of the Health Services Insurance Act is raised. The fact that the Union itself is not the money beneficiary of the award which has been challenged by Ford is not a reason to ignore the reality that the substantive issues in appeal arise from a disputed interpretation upon which the individual money calculations are dependent, and that the Union and Ford were the proper parties to the interpretation proceedings by way of arbitration alone.

The patent fact is that the money entitlements, if any, of the individual employees could not be made the subject of an action for their recovery until it had been determined in arbitration pro-

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ceedings that there was money owing to the employees. Once that was determined, there remained only the calculations. Hence, the challenge through certiorari to the interpretation given in the arbitration proceedings cannot be assimilated to an action brought by the Union on behalf of thousands of employees, especially when the merits going to the entire obligation of Ford could not be the subject of an action.

On this view of the matter, the applicable principle must be that expressed by this Court in Tonks v. Reid[6], viz., the amount or value of the matter in controversy is the monetary loss which the appellant will suffer if the judgment in appeal is upheld. That loss is undeniably within the dollar limit under s. 36.

I have not overlooked the definition of “judicial proceedings” in s. 2(1) of the Supreme Court Act. The phrase, which appears in s. 36(a), is defined as follows:

“judicial proceeding” includes any action, suit, cause, matter or other proceeding in disposing of which the court appealed from has not exercised merely a regulative, administrative, or executive jurisdiction.

The definition came into the Supreme Court Act in 1920 by virtue of 1920 (Can.), c. 32, s. 1(b), at the same time as this Court’s appellate jurisdiction was recast. As originally introduced and until the most recent revision of statutes, it was a “means and includes” definition. In R.S.C. 1970, c. S-19, the words “means and” were dropped. I do not regard this change as at all significant.

The only question—an obvious one—which the definition of “judicial proceeding” raises is whether the Ontario Court of Appeal can be said to have exercised a regulative, administrative or executive jurisdiction in determining that the judge of first instance was correct in dismissing Ford’s certiorari application. Whatever doubt there may be as to the exact reach of the words “regulative, administrative or executive”, they do not, in my opinion, embrace appeals arising out of a superior Court’s supervisory jurisdiction by certiorari or applications to quash in lieu of certiorari.

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Certainly, certiorari proceedings are within the words “any action, suit, cause, matter or other proceedings”; and the provincial appellate Court in disposing of them is exercising a judicial jurisdiction.

I would dismiss the motion to quash with costs to the appellants.

Application granted with costs, JUDSON and LASKIN JJ. dissenting.

Solicitors for the appellant: Blake, Cassels & Graydon, Toronto.

Solicitors for the respondent union: Armstrong & MacLean, Toronto.