Canada (Attorney General) v. Macadams, docket T-2763-95

     Court no. T-2763-95

IN THE MATTER OF an application to review and set aside pursuant to s. 18 and 18.1 of the Federal Court Act, R.S.C. 1985, c. F-7, as amended

AND IN THE MATTER OF a decision of Albert S. Burke, an Adjudicator and a member of the Public Service Staff Relations Board, rendered on November 27, 1995, respecting a grievance referred to adjudication pursuant to section 97 of the Public Service Staff Relations Act, R.S.C. c.P-35 (Public Service Staff Relations Board File no. 166-2-26601)

B E T W E E N:

     THE ATTORNEY GENERAL OF CANADA

     Plaintiff

     - and -

     CHESTER D. MacADAMS

     Defendant

     REASONS FOR ORDER

CULLEN, J.:

     This is an application for judicial review in which the applicant, the Attorney General of Canada (hereinafter, the "employer") seeks an Order setting aside the decision of Albert S. Burke, an Adjudicator and member of the Public Service Staff Relations Board, (hereinafter, the "adjudicator"), rendered on November 27, 1995 (PSSRB File No. 166-2-26601). In that decision, the adjudicator upheld the respondent Chester D. MacAdams' (hereinafter, the "respondent") grievance, finding that there had been an inequitable distribution of standby as a result of the employer restricting the standby list to military personnel.

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THE FACTS

     The respondent is a civilian employee of the Department of National Defence. He was at all material times, an electronic systems technologist, classified as job classification EL-4 within the Technical Maintenance Article, Technical Services Branch at Canadian Forces Station Leitrim, Ontario.

     The respondent was at all material times represented by the International Brotherhood of Electrical Workers. The terms and conditions of the respondent's employment were at all material times governed by the collective agreement currently in force between the International Brotherhood of Electrical Workers and the Treasury Board (hereinafter, the "employer").

     At all material times, the respondent worked in the Communications Maintenance Cell, which is one of the three cells for the Technical Maintenance Article at Canadian Forces Station Leitrim, Ontario.

     In 1991, the applicant established a standby list in accordance with article 29 of the collective agreement. Although the provision applied only to civilian personnel, in practice, the standby list included both civilian and military technicians. As the provision required an equitable distribution of standby duties, these duties were assigned on a rotational basis.

     The respondent was on standby in accordance with article 29 of the collective agreement from 1991 until August 1994 and was paid accordingly.

     During the summer of 1994, the Commanding Officer decided that, in order to meet the new Salary Wage Envelope requirements, civilian employees would be removed from the standby list.

     On August 19, 1994, the respondent was advised by his supervisor that he would be removed from the standby list on August 23, 1994 at 0800 hours, and that from that time onward, only military technicians would be placed on the standby list.

     On August 19, 1994, the respondent submitted a grievance to the employer on the ground that the employer had breached the terms of article 29 of the collective agreement in failing to provide standby duties on an equitable basis. The employer rejected the grievance. The grievance was referred to adjudication on June 23, 1995.

     The adjudicator held that clause 29.09 of the collective agreement was vague and ambiguous respecting the equitable distribution of standby duties. This required the adjudicator to consider evidence extrinsic to the contract itself. On the basis of the past conduct of the employer vis-à-vis the bargaining unit, the adjudicator concluded that there had been an inequitable distribution of standby when the applicant had included only military personnel on the standby list. The adjudicator thus interpreted the collective agreement to require standby to be paid to the respondent.

THE ISSUES

1.      Did the adjudicator err in law in holding that clause 29.09 of the collective agreement was ambiguous?

2.      Did the adjudicator err in law when he relied on extrinsic evidence to interpret clause 29.09 of the collective agreement?

3.      Did the adjudicator err in law to an extent warranting the intervention of this Court in his interpretation and application of the collective agreement by finding that there had been an inequitable distribution of standby contrary to article 29 of the collective agreement?

DISCUSSION

1. AMBIGUITY:

The law: where the language of a document and the incorporated manifestations of initial intention are clearly having regard to the document alone and can be applied without difficulty to the facts of the case, no patent ambiguity exists. The term "latent ambiguity" is applied, generally, where doubtful meaning or doubtful application arises.¹

     Clause 29.09 of the collective agreement reads as follows:

When there is a known requirement for standby duties on a continuing basis the Employer will use his best endeavours to distribute the standby duties on an equitable basis among qualified available employees and on a weekly basis.

     "Bargaining unit" and "employee" are defined in subclauses 2.01(c) and (g) as follows:

For the purpose of this Agreement:...

(c) "bargaining unit" means the employees of the Employer in the Electronics Group, Technical Category, as described in the certificate issued by the Public Service Staff Relations Board on the 7th day of March 1969;

...

(g) "employee" means an employee as described in the Public Service Staff Relations Act, and who is a member of the bargaining unit;

Clause 29.01 states that in order for standby to exist, the employee must be notified in writing by the employer that she/he is required for standby. If the employee is not notified, then she/he is not entitled to standby.

     The relevant portions of article 7 of the collective agreement with respect to managerial rights read as follows:

7.01 The Local recognizes and acknowledges that the Employer has and shall retain the exclusive right and responsibility to manage its operation in all respects including, but not limited to, the following:

...

(b) to direct the working forces including the right to decide on the number of employees, to organize and assign work, to schedule shifts and maintain order and efficiency, to discipline employees including suspension and discharge for just cause;

and it is expressly understood that all such rights and responsibilities not specifically covered or modified by this Agreement shall remain the exclusive rights and responsibilities of the Employer.

7.02 Such rights will not be exercised in a manner inconsistent with the express provisions of this Agreement.

The facts: The adjudicator found that clause 29.09 was vague. To arrive at this conclusion, the adjudicator considered the case Re Municipality of Metropolitan Toronto v. Canadian Union of Public Employees, Local 43 (1983), 13 L.A.C. (3d) 58 at 61 (hereinafter, Re Municipality). In that case, the court found the expression "as equitably as possible" to be vague. The court reasoned that where a deliberately vague term is inserted into a collective agreement, it is because the parties intend to work through, on a consensual basis, the meaning that is to be given to that term. On this basis, the adjudicator concluded that, because the conduct of both parties in the present case showed that the meaning that they gave to the deliberately vague term "equitable basis" in clause 29.09 between 1991 and 1994 was that the respondent was on the standby list, a new meaning cannot now be given to clause 29.09. For the same reasons, the adjudicator also found the meaning of clause 29.09 to be ambiguous.

Analysis: The applicant submits that the intentions and the meaning of clause 29.09 are clear from the face of the document. The clause was intended to provide for the equitable or fair distribution of standby duties among qualified available employees in the bargaining unit. The scope of clause 29.09, the applicant submits, is clearly restricted to members of the bargaining unit by subclause 2.01(g), which defines "employee" for the purpose of the collective agreement.

     The applicant's argument goes along the following lines: since the scope of clause 29.09 is restricted to members of the bargaining unit because subclause 2.01(g) defines "employee" for the purpose of the collective agreement, and since standby duties were assigned exclusively to military personnel as of August 23, 1994, there was no longer a question of an equitable distribution of standby duties among bargaining unit employees, as they were no longer included on the standby list. Therefore, clause 29.09 was no longer applicable to bargaining unit employees.

     Although, technically speaking, the applicant's argument has merit, it does not take into account, at all, the significance of the parties' past conduct, which reveals the latent ambiguity of the provision. The applicant's argument also does not take into account the nature of a collectively bargained-for agreement. The past conduct, which is extrinsic evidence, can only be taken into account if the terms of the provision at issue are ambiguous. The applicant's argument makes sense because there is no patent ambiguity in the provision. However, it is precisely the extrinsic evidence of the parties' past conduct from the very inception of the provision, which reveals the latent ambiguity of the provision. Extrinsic evidence may be admitted to disclose a latent ambiguity, in either the language of the contract or in its application to the facts.² The adjudicator's finding of ambiguity was supported by the evidence before him, and I have no reason to interfere with this finding.

     Furthermore, the case at bar is clearly distinguishable from the case of Her Majesty the Queen v. Charland, [1982] 1 F.C. 455 at 457 (F.C.A.) (hereinafter, Charland). In Charland, an employer's gratuitous practise was at issue. However, here, a bargained-for provision is at issue.

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2. EXTRINSIC EVIDENCE

The law: In general, extrinsic evidence is inadmissible to contradict, vary, add to or subtract from a contract reduced to writing. However, extrinsic evidence may be admitted as an aid to interpretation where the contract is latently or patently ambiguous.³

The facts: The adjudicator admitted extrinsic evidence with respect to the past practice of the employer and the bargaining agent in order to decide the issue of equitable distribution of standby pursuant to clause 29.09.

Analysis: Because there was latent ambiguity in the terms of the provision, the adjudicator made the right decision in considering extrinsic evidence central to the meaning that the parties had given to clause 29.09.

3. ERROR IN LAW WARRANTING INTERVENTION?

     The adjudicator decided that, although subclause 7.01(b) gave management the right to decide on the number of employees in the workforce, that right only pertained to situations not specifically covered or modified by the collective agreement. The situation before the adjudicator was already covered by the collective agreement. In any event, pursuant to clause 7.02, this right had to be exercised in a manner consistent with other clauses of the collective agreement. I agree.

     At page 13 of his reasons, the adjudicator states:

All of the provisions and conditions of Article 29 of the collective agreement relate to employees as per the collective agreement and not to military personnel. The employer's representative states that all the employer needs to do in order to avoid applying Article 29 is to stop notifying employees in writing when standby is required. This is totally unacceptable and violates the provisions of Article 29.

The employer's argument, in a technical sense, makes sense. However, the result of such a technical approach would be exactly that, which the adjudicator describes as an unacceptable violation of the collective agreement. From a policy perspective, it should not be so easy to get around the negotiated terms of a collective agreement. This is hardly a result that at least one of the parties (i.e., the bargaining unit) would have bargained for. Furthermore, judging from the past conduct of both parties, it is unlikely that this is the result that the employer had bargained for, either.

     The applicant submits, in the alternative, that if the adjudicator did not err in concluding that clause 29.09 is ambiguous, then the adjudicator's interpretation of clause 29.09 was unreasonable. It was unreasonable in that the adjudicator erred by failing to give meaning to the word, "employee" as it is defined in the collective agreement. However, the adjudicator's reasons indicate to me that he did not fail to give meaning to the word, "employee."

     The applicant submits that clause 29 does not require standby to be distributed to members of the bargaining unit. This clause merely governs the implementation of standby when members of the bargaining unit are notified in writing that they must assume standby duties. The collective agreement does not guarantee that standby duties will be assigned to the bargaining unit. Therefore, pursuant to Article 7, the applicant has retained the exclusive right to manage operations in such a manner that may preclude bargaining unit members from receiving standby duties.

     I disagree. Managerial rights do not override the specific provisions of the collective agreement. Although there is no guarantee that bargaining unit employees will be provided with standby duties, these employees cannot suddenly be deprived of access to a bargained-for provision. The equitable distribution of standby duties clause still exists, and the employer must adhere to it. The adjudicator made no error in coming to this conclusion.

     To summarize, I have difficulty with the applicant's position, because it does away with a provision in a collective agreement by fiat. In essence, the applicant submits that since the assignment of standby duties was to qualified military personnel only as of August 23, 1995, clause 29.09 was of no further use or effect, as the people to whom it was directed ("employees") were no longer covered by it (could no longer have standby assignments), and because military personnel (who are neither employees nor members of the bargaining unit, and who could, therefore, have standby assignments) were not subject to the equitable distribution requirement. However, by virtue of the employer's practise over a three-year period which was acquiesced to by the bargaining agent, there had been an understanding between them, as outlined in the Agreed Statement of Facts, that up until August, 1994, both civilians and military personnel would be placed on the standby list. Is it possible to get rid of a significant provision in a collective agreement without negotiation? I think not. This is not the way that provisions are to be effectively deleted from collective agreements.

CONCLUSION

     It is well established that curial deference be shown to the opinions of specialized administrative boards, where the specialization is squarely within the four corners of its jurisdiction. Accordingly, an adjudicator in a labour relations matter has the requisite expertise to interpret a collective agreement. In the case of 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, at pp. 250-251, La Forest, J., summarized the degree of deference which should be accorded to an arbitrator's decision as follows:

... courts should, as a matter of policy, defer to the expertise of the arbitrator in questions relating to the interpretation of collective agreement ... It is clear that an arbitrator has jurisdiction stricto sensu to interpret the provisions of the collective agreement in the course of determining the arbitrability of matters under the agreement. In that case the arbitrator is acting within his or her 'home territory,' and any judicial review of that interpretation must only be on a standard of patent unreasonableness.

In light of counsel's submissions, the written evidence and case law before this Court, and the standard of review that I held to be applicable to the decisions of this very tribunal in Canada (Attorney General) v. Wiseman (1995), 95 F.T.R. 200 (hereinafter, Wiseman), I conclude that the adjudicator's finding on ambiguity was supportable by the evidence, and, therefore, is not subject to judicial intervention. Accordingly, it was right and proper for the adjudicator to have considered extrinsic evidence in arriving at this conclusion.

     My closing comments in Wiseman at 207 bear repeating in this case:

A fundamental object in construing the terms of a collective agreement is to discover the intention of the parties. A decision which reflects an appreciation for the dynamics of the workplace is precisely the kind of decision which merits a high degree of curial deference. The [adjudicator's] decision, in this case, was reasonably supported by the evidence, and, as such, there is no scope for judicial interference.

     This application for judicial review is dismissed.

OTTAWA

     B. Cullen

November 25, 1996.

     J.F.C.C.

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     ¹Leitch Gold Mines Ltd. et al. v. Texas Gulf Sulphur Co. et al., [1969] 1 O.R. 469, 3 D.L.R. (3d) 161 at 215-216 (Ont. H.C.) (hereinafter, Leitch cited to D.L.R.).

     ²Leitch, supra note 1 at 216.

     ³Ibid.; Doyon v. Canada (Public Service Staff Relations Board), [1978] 1 F.C. 31 (F.C.A.) (hereinafter, Doyon).