Construction and Specialized Workers' Union, Local 1611 v. British Columbia Labour Relations Board

2007 BCSC 315 Construction and Specialized Workers' Union, Local 1611 v. British Columbia Labour Relations Board

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Construction and Specialized Workers' Union, Local 1611 v. British Columbia Labour Relations Board, 2007 BCSC 315 Date: 20070306 Docket: No. S-065617 Registry: Vancouver In the matter of the Judicial Review Procedure Act, R.S.B.C. 1996, c. 241 And in the matter of the Labour Relations Code, R.S.B.C. 1996, c. 244 And in the matter of decisions of the British Columbia Labour Relations Board dated February 10, 2006 and July 21, 2006 Between: Construction and Specialized Workers' Union, Local 1611 Petitioner And British Columbia Labour Relations Board, Lockwood Bros. Concrete Products, Trivern Enterprises Ltd., Roger Lockwood, and 0547847 B.C. Ltd. Respondents Before: The Honourable Madam Justice Allan Reasons for Judgment Counsel for the Petitioner: John MacTavish Counsel for the Respondent British Columbia Labour Relations Board: Counsel for the remaining Respondents: Elena Miller Craig Munroe Date and Place of Hearing: January 30 and 31, 2007 Vancouver, B.C. [1] The petitioner, Construction and Specialized Workers' Union, Local 1611 (the "Union"), applies pursuant to the Judicial Review Procedure Act, R.S.B.C. 1996, c. 241, for a judicial review of two decisions of the respondent Labour Relations Board (the "Board"): · A decision of the Original Panel dated February 10, 2006 and numbered BCLRB No. B38/2006 (the "Original

Decision"); and, · A decision of the Reconsideration Panel dated July 21, 2006 and numbered BCLRB No. B164/2006 (the "Reconsideration Decision"). [2] I will refer to the respondents (other than the Board) collectively as the Respondents. [3] At the heart of the dispute is the issue of whether the Board erred in finding that the respondent Lockwood Bros. Concrete Products ("Lockwood Bros.") is not the successor employer to the respondent Trivern Enterprises Ltd. ("Trivern"). Section 35 of the Labour Relations Code, R.S.B.C. 1996, c. 244 (the "Code") deals with successorship: 35 (1) If a business or a part of it is sold, leased, transferred or otherwise disposed of, the purchaser, lessee or transferee is bound by all proceedings under this Code before the date of the disposition and the proceedings must continue as if no change had occurred. (2) If a collective agreement is in force, it continues to bind the purchaser, lessee or transferee to the same extent as if it had been signed by the purchaser, lessee or transferee, as the case may be. [4] As the Board pointed out in its Original Decision, the purpose of s. 35 is to ensure that where all or a part of a business is disposed of, the transferee receives it subject to all of the proceedings under the Code and any collective agreement between that business and the union. [5] In brief written reasons constituting the

Reconsideration Decision, the Board dismissed the Union's application for leave and reconsideration of the Original Decision. Issues: [6] The Union submits that the Board's decisions contain the following errors: · The Board breached the principles of natural justice by failing to provide reasons - or, alternatively, adequate reasons - for its Reconsideration Decision; · The Board breached the rules of natural justice and/or committed a patently unreasonable error by making conclusions of fact which were not supported by evidence and/or by failing to consider relevant evidence; · The Board made a patently unreasonable decision when it found that: o all or part of the business of Trivern had not been sold, leased, transferred or otherwise disposed of to Lockwood Bros.; and o Lockwood Bros. was not the successor employer to Trivern under s. 35 of the Code. [7] The Respondents submit that this Court has jurisdiction to review only the Reconsideration Decision; however, it is common ground that to do so encompasses an examination of whether the Board's Original Decision was patently unreasonable. Facts: [8] In a series of related decisions, the Board found the following facts which are not in dispute. · Lockwood Bros. is a corporate partnership owned by James and Richard Lockwood through their respective wholly owned and controlled corporate entities, Westcan Bridge Systems Ltd.

and Westcan Building Systems Ltd. · Trivern and the respondent 547847 BC Ltd. are corporations owned and controlled by Roger Lockwood, the father of James and Richard Lockwood. · Trivern was formerly known by the names Wescon Enterprises Ltd. and Western Concrete Products, a Partnership (together "Wescon"). These two entities were declared a common employer for the purposes of the Code. · Roger Lockwood, through his various companies, had been in the concrete business since 1979. Before James and Richard Lockwood joined the business, Roger Lockwood was the lone principal of Wescon Enterprises Ltd. · James and Richard Lockwood had worked in the family businesses most of their adult lives. They became full time employees of Wescon in 1998 and 2000 respectively. By 2000 Roger, James and Richard Lockwood all had an ownership interest in, and worked for, Wescon. The Board found that James and Richard Lockwood were being groomed to take over Wescon over a span of 10 years. · Wescon was described by the Board as a business with "successive generations of principals". · The Union was certified under the Code to represent a bargaining unit of employees employed by Wescon. · Wescon manufactured (and sometimes installed) prefabricated and pre-stressed concrete products. Wescon operated at and from 1140 and 1160 Highway 97A - adjacent properties outside of Armstrong (the "Highway 97A

Site"). The Highway 97A Site is owned by 547847 BC Ltd. · On July 25, 2001 the Union commenced a legal strike against Wescon after they were unable to agree upon the terms of a new collective agreement. Wescon had eight bargaining unit employees actively employed at that time. · Following the commencement of the Union's strike, Wescon continued to operate and it was twice found to have violated s. 68 of the Code by illegally using replacement workers. · James and Richard Lockwood have made it clear that they do not want a union to represent their employees. They share with their father what the Board referred to as "anti-union animus". · In August 2001, Wescon made an offer to the Union to settle the strike. It advised the Union that if the offer was rejected Wescon would cease operation indefinitely and only re-open when a "suitable collective agreement" had been reached. The offer was rejected. Wescon then continued to operate until it closed on June 28, 2002. · In July 2002, James and Richard Lockwood cashed in their investment in Wescon and commenced doing business under the name Lockwood Bros. Lockwood Bros. initially manufactured pre-cast concrete products from a location owned by one of Roger Lockwood's companies which was near the Highway 97A Site. Lockwood Bros. operated from that nearby site for the next three years. · After June 2002, Wescon (and subsequently

Trivern) sold the majority of its inventory but retained virtually all of the productive assets of Wescon intact. Wescon began renting equipment primarily to Lockwood Bros. The rental of the equipment was at favourable terms and conditions and below market rates. Some of the equipment rented by Wescon (and subsequently Trivern) to Lockwood Bros. was equipment which had formerly been used by members of the Union's bargaining unit. · Following the commencement of the Lockwood Bros. operations, the Union applied to the Board under s. 35 of the Code for a declaration that Lockwood Bros. was the successor employer to Wescon. The Board dismissed the Union's application on December 4, 2003. A crucial finding in that decision was that James and Richard Lockwood were not "key persons" in Wescon. The Board, in making this finding, focused on the 10 years contemplated for the brothers to take over the business, and the lack of evidence concerning their reputation in the business community. · The Union applied to the Board for leave and reconsideration of that decision. Its application was dismissed without reasons on January 28, 2004. · On July 12, 2004, Trivern applied to the Board for an order that the Union stop picketing at the Highway 97A Site. Trivern asserted that its business was closed and therefore the Union had no continuing right to picket. · The Board dismissed that

application on December 21, 2004. It framed the issue to be decided thus: [T]he question before me is whether there exists a reasonable prospect that the business will be resumed and employees re-employed--put differently, is the business dormant or has it died? · The Board concluded by finding that "the business lies dormant." The Panel was "not persuaded that the certified business is permanently closed" and concluded: "[T]here remains a reasonable prospect employees will work in a viable pre-cast concrete manufacturing business although it will not likely be owned or operated by [Roger] Lockwood." · Trivern, Roger Lockwood and 547847 B.C. Ltd. applied to the Board for leave and reconsideration of that decision. Their application was dismissed on March 22, 2005. · In the summer of 2005, apparently due to their expanding business, Lockwood Bros. prepared to move operations to the larger Highway 97A Site, and signed a lease with Roger Lockwood for property there. This development apparently motivated further applications to the LRB. · On August 29, 2005 Lockwood Bros. again applied to the Board for an order that the Union stop picketing at the Highway 97A Site. · On September 12, 2005 the Union again applied to the Board under s. 35 of the Code for a declaration that Lockwood Bros. was the successor employer to Trivern. · The Board allowed Lockwood Bros.' picketing application

and dismissed the Union's successorship application. It found that many of the indicia of successorship were absent including "the same employees". · The Board stated at paragraph 54: Although Roger Lockwood's concrete manufacturing business is not dead because the Trivern panel held out the possibility that Roger Lockwood would transfer the dormant concrete manufacturing business to a potential successor, another year has passed without a third party breathing life into the dormant business. I find that this lengthy hiatus weighs heavily against a finding that Lockwood Bros. is a successor to Trivern. The Board's Argument: [9] Ms. Miller, counsel for the Board, noted that the Board has standing to appear in court on judicial review of its decisions to make submissions not only as to jurisdiction and to explain the record, but also to show that its decisions were not patently unreasonable: Rebcon Ironworks Ltd. v. International Association of Bridge, Structural and Ornamental Iron Workers, Local 97, [1997] B.C.J. No. 569 (S.C.)(QL) at para. 12. [10] The Board's submissions focused on the appropriate standard of review (which is not disputed by the Union or the Respondents). The Standard of Review: [11] The standard of review is not contested. This judicial review is governed by s. 58 of the Administrative Tribunals Act, S.B.C. 2004, c. 45 ("ATA"): 58 (1) If the tribunal's

enabling Act contains a privative clause, relative to the courts the tribunal must be considered to be an expert tribunal in relation to all matters over which it has exclusive jurisdiction. (2) In a judicial review proceeding relating to expert tribunals under subsection (1) (a) a finding of fact or law or an exercise of discretion by the tribunal in respect of a matter over which it has exclusive jurisdiction under a privative clause must not be interfered with unless it is patently unreasonable, (b) questions about the application of common law rules of natural justice and procedural fairness must be decided having regard to whether, in all of the circumstances, the tribunal acted fairly, (c) for all matters other than those identified in paragraphs (a) and (b), the standard of review to be applied to the tribunal's decision is correctness. [12] As s. 138 of the Code contains a privative clause, the standard of review of the Board's decisions is governed by s. 58(2) of the ATA. Section 138 provides: 138. A decision or order of the board under this Code, a collective agreement or the regulations on a matter in respect of which the board has jurisdiction is final and conclusive and is not open to question or review in a court on any grounds. [13] Section 35 of the Code gives the Board jurisdiction over the issue of whether one business is a "successor" employer of another for

purposes of the Code: 35.(1) If a business or a part of it is sold, leased, transferred or otherwise disposed of, the purchaser, lessee or transferee is bound by all proceedings under this Code before the date of the disposition and the proceedings must continue as if no change had occurred. (2) If a collective agreement is in force, it continues to bind the purchaser, lessee or transferee to the same extent as if it had been signed by the purchaser, lessee or transferee, as the case may be. (3) If a question arises under this section, the board, on application by any person, must determine what rights, privileges and duties have been acquired or are retained. (4) For the purposes of this section, the board may make inquiries or direct that representation votes be taken as it considers necessary or advisable. (5) The board, having made an inquiry or directed a vote under this section, may (a) determine whether the employees constitute one or more units appropriate for collective bargaining, (b) determine which trade union is to be the bargaining agent for the employees in each unit, (c) amend, to the extent it considers necessary or advisable, a certificate issued to a trade union or the description of a unit contained in a collective agreement, (d) modify or restrict the operation or effect of a provision of a collective agreement in order to define the seniority rights under

it of employees affected by the sale, lease, transfer or other disposition, and (e) give directions the board considers necessary or advisable as to the interpretation and application of a collective agreement affecting the employees in a unit determined under this section to be appropriate for collective bargaining. [14] Section 136 of the Code gives the Board exclusive jurisdiction to hear and decide matters arising under the Code. Section 136 reads, in part, as follows: 136 (1) Except as provided in this Code, the board has and must exercise exclusive jurisdiction to hear and determine an application or complaint under this Code and to make an order permitted to be made. (2) Without limiting subsection (1), the board has and must exercise exclusive jurisdiction in respect of (a) a matter in respect of which the board has jurisdiction under this Code or regulations, . [15] Section 141 of the Code gives the Board a discretion as to whether to grant leave for a reconsideration of a decision by the Board: 141.(1) On application by any party affected by a decision of the board, the board may grant leave to that party to apply for reconsideration of the decision. (2) Leave to apply for reconsideration of a decision of the board may be granted if the party applying for leave satisfies the board that (a) evidence not available at the time of the original decision has become

available, or (b) the decision of the board is inconsistent with the principles expressed or implied in this Code or in any other Act dealing with labour relations. [16] Thus, the Board's decisions on the Union's application for a declaration under s. 35 and for a reconsideration under s. 141 are within its exclusive jurisdiction. Such a decision is reviewable by the Court on the basis of a standard of patent unreasonableness. [17] Our Court of Appeal has considered how this Court is to apply the standard of patent unreasonableness to decisions of the Board in a number of decisions. [18] In Budgell v. British Columbia (Labour Relations Board), [2003] B.C.J. No. 2662 (C.A.)(QL), Madam Justice Huddart for the Court stated at paragraphs 8 and 9: The task of the chambers judge was to determine whether the Board's decision was rational and reached in accordance with the rules of natural justice, not to determine the issue afresh: Health Sciences Assn. of British Columbia et al. v. Versa Services et al. (1992), 91 D.L.R. (4th) 582 (B.C.C.A.). It is not appropriate for this Court, nor was it appropriate for the chambers judge, to consider whether the Board's decision was wrong. The Board is entitled to be wrong in the eyes of the court if it acts within its jurisdiction: Canadian Assn. of Industrial, Mechanical and Allied Workers, Local 14 v. Paccar of Canada Ltd., [1989] 2 S.C.R.

983; Canada (Attorney General) v. Public Service Alliance of Canada, [1993] 1 S.C.R. 941 ["PSAC"]; Aujla v. British Columbia Labour Relations Board et al., [2000] B.C.J. No. 2731, 2000 BCSC 1896, aff'd [2001] B.C.J. No. 2187, 2001 BCCA 611; Speckling v. LRB et al., [2002] B.C.J. No. 1676, 2002 BCSC 1083, aff'd [2003] B.C.J. No. 909, 2003 BCCA 240. In PSAC, supra, the Supreme Court acknowledged that the patent unreasonableness test was "clearly a very strict test", writing at paragraph 46: It is not enough that the decision of the Board is wrong in the eyes of the court; it must, in order to be patently unreasonable, be found by the court to be clearly irrational. [19] In Speckling v. British Columbia (Workers' Compensation Board), [2005] B.C.J. No. 270, 2005 BCCA 80 at para. 37, Madam Justice Levine for the Court stated: a decision is not patently unreasonable because the evidence is insufficient. It is not for the court on judicial review, or for this Court on appeal, to second guess the conclusions drawn from the evidence considered by the Appeal Division and substitute different findings of fact or inferences drawn from those facts. A court on review or appeal cannot reweigh the evidence. Only if there is no evidence to support the findings, or the decision is "openly, clearly, evidently unreasonable", can it be said to be patently unreasonable. That is not the case

here. [20] In Canadian Union of Public Employees, Local 561 v. British Columbia (Labour Relations Board), 2005 BCSC 1366, at para. 47, Mr. Justice McEwan considered the meaning of the term "clearly irrational": Where the issue is whether all of the relevant factors have been considered or properly weighed against each other, it is difficult to conceive of a decision that would be "clearly irrational", unless proper considerations were abandoned wholesale or manifestly distorted . [21] The degree of curial deference to which the Board is entitled was underscored by Madam Justice Southin in Kelowna (City) v. CUPE, Local 338, 1999 BCCA 235 at para. 9: The concept of curial deference is fundamental to all issues of judicial review when such a judicial review petition is brought to quash a judgment of a specialized tribunal such as the Labour Relations Board. The Board is no ordinary specialized tribunal. It has developed over the years a true body of jurisprudence on its own statute which it applies. It is therefore entitled, in the administration of the Labour Code, to a very high degree of curial deference. [22] As Mr. Justice Iacobucci for the Court stated in Law Society of New Brunswick v. Ryan, 2003 SCC 20 at para. 52: "A decision that is patently unreasonable is so flawed that no amount of curial deference can justify letting it stand." The Original Decision: [23] The Board's

14 page Original Decision dealt with Lockwood Bros.' application to prohibit the Union from picketing at the Highway 97A Site and the Union's s. 35 application for a declaration that Lockwood Bros. was the successor employer to Trivern. [24] The Board rejected Lockwood Bros.' preliminary argument that the doctrine of res judicata applied as a result of the Board's earlier conclusion in 2003 that Lockwood Bros. was not a successor of Wescon. It found that the following material changes had been made since that date: · Lockwood Bros. was moving to the Highway 97A Site where it would use the assets of Trivern, although Trivern had rented part of the Highway 97A site to two businesses other than Lockwood Bros. Neither of those two businesses were involved in manufacturing concrete products. Trivern had sold inventory and some equipment on a piecemeal basis since the strike begun. · Lockwood Bros. had CSA certifications that allowed it to obtain government-sponsored contracts; · Lockwood Bros. manufactured pre-stressed concrete as well as pre-cast concrete; · Lockwood Bros. had an arrangement to rent and use equipment from Trivern; · Lockwood Bros. had some of the same customers as Wescon, later Trivern; and · Initially, James and Richard Lockwood had been the only employees at Lockwood Bros. By the time of the hearing, they had 10 employees in addition to the two brother/owners.

Only one of those 10 employees had been an employee of Wescon before the strike. [25] The Union argued that Trivern's business had been resuscitated by Lockwood Bros. Lockwood Bros. argued that the only change of circumstance was its expansion and the move of its operations across to the Highway 97A site. [26] The Board considered the Union's submission that the familial relationship between the principals of Lockwood Bros. and Trivern was a feature of the lack of arm's length dealings between the two businesses. It was alive to previous Board decisions such as Lyric Theatre Ltd., BCLRB No. 38/80, [1980] 2 Can LRBR 331 and Napier Intermediate Care Home Ltd., BCLRB No. B191/97 (Leave for Reconsideration of BCLRB No. B370/96) which held that familial relationships between predecessors and alleged successors require close examination. It also considered the fact that the Respondents shared an anti-union animus. The issue for determination was whether the new business was a continuation of the old business and the corporate structure was merely a sham to avoid the union. [27] The Board noted at paragraph 46 that many of the indicators of successorship considered in Lyric were not present in this case: "good will, logo or trademark, customer lists, accounts receivable, inventory, covenants to maintain a good name or not to compete, and the same employees." It then analysed the

factors that were present: · Lockwood Bros. was producing the same products for some of the same customers as Wescon did before the strike and closure of operations. However, Lockwood Bros. was able to access those same customers as a result of its own efforts to obtain CSA certification and it had to bid successfully to get that work; and · Lockwood Bros. had begun to use Trivern's equipment in order to produce larger concrete products for its customers and, following the move to the Highway 97A Site, it would use most of Trivern's assets. [28] The Board considered it significant that a transfer of assets was taking place through the lease of the Highway 97A site and the arrangement to rent Trivern's equipment on terms favourable to Lockwood Bros. However, a transfer of assets on its own was not sufficient to find a successorship. There had been a lengthy hiatus of three years between the closure of Wescon and the decision of Lockwood Bros. to lease the Highway 97A Site. The longer a hiatus, the more likely it is that a new business is a reincarnation rather than a resuscitation. [29] The Board dismissed the Union's s. 35 application on the following basis at paragraphs 59 and 60: While these factors tend to point toward a successorship, they arose over a lengthy period of time and are intermingled with the considerable effort James and Richard Lockwood put into building their

own business without the use of Wescon equipment. There are many other factors besides the hiatus that weigh against the finding of a successorship. Lockwood Bros. are not benefiting from Wescon's name and reputation, Wescon's CSA certifications, or any of Wescon's inventory. Notably, the Wescon decision [the earlier succession decision of the Board] concluded that James and Richard Lockwood are not key persons. This case falls right on the line between reincarnation and resuscitation. On balance when I weigh all the factors in favour of and against a successor finding, I am not persuaded that there is a sufficient continuity between Trivern (Wescon) and Lockwood Bros. to find that a successorship has taken place. In my view, Lockwood Bros. is leasing the site and assets of Trivern to integrate them into a pre-existing dynamic business. This amounts to reincarnation, i.e., the operation of a like business. It is not resuscitation, i.e., taking a moribund business and breathing new life into it. [30] The Union was ordered to cease and desist picketing at the Highway 97A site after Lockwood Bros. moved to that location. [31] In its short Reconsideration Decision, the Board recognized the application of the Board's law and policy in "an unusual, perhaps even unique, factual context." The Union's primary argument was that the Board had failed to properly consider three factors: the

lack of an arm's length relationship between Trivern/Lockwood Bros; the fact that the hiatus was the result of a strike; and the presence of an anti-union animus. The Reconsideration Panel noted that the original panel had weighed those factors and applied the relevant law and Board policy. It characterized the Union's submissions as a challenge to the manner in which the original panel weighed the evidence. It found no palpable or overriding error in the findings of fact or inferences drawn from the facts in the Original Decision and no error of law or inconsistency with Code principles. Leave was denied and the Union's application for reconsideration was dismissed. The Union's Argument: [32] The Union submits that by the time of its application under s. 35 of the Code in September, 2005, Lockwood Bros. had entered into a leasing agreement for the Highway 97A Site. As well as working at the same site formerly used by Wescon, Lockwood Bros. then did the same work, for the same major customers, using much of the same equipment as Wescon. As well, three people who worked for Wescon now worked for Lockwood Bros. In fact, two of those three people were James and Richard Lockwood, who were of course, employers rather than employees. Failure to provide reasons: [33] The Union submits that, in its Reconsideration Decision, the Board breached the rules of natural justice by failing to

provide reasons or, alternatively, adequate reasons. The applicable standard of review is governed by s. 58(2)(b) of the ATA: (b) questions about the application of common law rules of natural justice and procedural fairness must be decided having regard to whether, in all of the circumstances, the tribunal acted fairly [34] The Board does not have a statutory obligation to give reasons for denying leave to reconsider its prior decision. In Canadian Office and Professional Employees' Union, Local 378 v. British Columbia Hydro and Power Authority et al, 2006 BCSC 1145 ["COPE"], Mr. Justice Goepel stated at paragraph 37: The Board has no statutory obligation to give reasons for denying leave to reconsider a prior decision. The Board's policy of not giving reasons is one that it is entitled to adopt. The failure to give reasons concerning all matters raised in a leave application does not breach procedural fairness. [35] In Stark v. Vancouver School District No. 39, 2005 BCSC 931, aff'd 2006 BCCA 124, the Court stated at paragraph 63: Based on policy, legal and practical considerations and as a means of best advancing the objectives of the Code and implementing the legislative intention, as explained in RG Properties Ltd. and Prospero Canadian Land Investment Fund Ltd. et al, [2003] B.C.L.R.B.D. No. 378, B.C.L.R.B. No. B378/2003, the Labour Board no longer as a general practice,

provides reasons for denying leave under section 141. Here the Labour Board decision denying leave was brief but imparted sufficient enough explanation to Mr. Stark. By no means was it patently unreasonable or warranting judicial interference on any other ground. [36] Mr. McTavish submits that, in certain circumstances, the duty of procedural fairness will require the provision of a written explanation for a decision: Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817, 174 D.L.R. (4th) 193. However, Baker is clearly distinguishable. In that case, which concerned the duty of procedural fairness that applies when immigration officials handle requests for exemptions from deportation orders on humanitarian and compassionate grounds, there was a statutory right of appeal. In fact, the subordinate officer's handwritten notes were found to fulfill the requirement for written reasons. [37] The Union argues that the Baker decision was cited with approval in the context of a decision of a labour relations board in United Brotherhood of Carpenters and Joiners of America, Local 579 v. Northland Contracting Inc., [2004] N.J. No. 404 (S.C.(T.D.))(QL), rev'd on other grounds 2006 NLCA 11. There the Court concluded that the Newfoundland Labour Relations Board was required to provide reasons for its decision. However, the relevant legislation, Newfoundland and

Labrador's Labour Relations Act, requires the Board to provide written reasons for its decisions. [38] In this jurisdiction, the law is as stated in COPE and Stark. The Reconsideration Panel had no obligation to undertake the probing analysis of the Union's arguments that Mr. McTavish suggests. Alleged errors of fact and failure to consider the evidence: [39] The Union submits that the Board breached the rules of natural justice and/or committed a patently unreasonable error by (a) drawing conclusions of fact not supported by the evidence and/or (b) failing to consider relevant evidence. Same employees: [40] The Union agrees that the indicia of successorship are set out in Lyric. However, it asserts that the Board erred in failing to consider the fact that three employees of Lockwood Bros. had previously been employed by Trivern or Wescon. Apart from James and Richard Lockwood, only one employee who was employed by Wescon prior to the strike moved to Lockwood Bros. Nine other employees of Lockwood Bros. were not previously employed by Wescon or Trivern. It cannot be said that "the same employees" worked for both employers. Hiatus due to strike: [41] The Union also submits that the Board failed to properly weigh the effect of a strike on the finding that there had been "a lengthy hiatus of three years." Mr. McTavish suggests that the business was not closed; rather, the

employees were on strike. In fact, the Board acknowledged that the strike was the reason for the closure. The Union's real complaint is that the Board did not give this factor sufficient weight. Use of equipment: [42] Mr. McTavish submits that the Board minimized and misunderstood the significance of Trivern's assets used by Lockwood Bros. to do its business, most of which was for Trivern's former customers. The Board considered this factor at some length. The fact that it did not give it as much weight as the Union urged does not make its conclusion patently unreasonable. Transfer of capital: [43] The Union argued that the fact that James and Richard Lockwood sold their interest in Wescon to form Lockwood Bros. indicated that the formation of the latter was not an "arms length" transaction. The Original Panel misconstrued that argument as one relating to the profitability of Trivern, which was not a determinative factor in deciding successorship. However, the Reconsideration Panel noted at paragraph 14 that the Original Panel had "clearly considered and weighed the fact there was no arm's length relationship between the companies." [44] In my view, none of the Board's factual findings here are patently unreasonable. Patently unreasonable errors of law: [45] The Union characterizes the Board's decision that Lockwood Bros. was not the successor to Trivern as a patently

unreasonable error of law. Mr. McTavish cites Rebcon at paragraph 20 for the proposition that, despite the deference to which the Board is entitled, the courts must not defer to decisions that are patently unreasonable. That principle is also articulated in W.W. Lester (1978) Ltd. v. UA, Local 740, [1990] 3 S.C.R. 644, 76 D.L.R. (4th) 389; BCGEU v. British Columbia (Industrial Relations Council) (1988), 33 B.C.L.R. (2d) 1 (C.A.) and PSAC v. Bombardier, [2001] 2 F.C. 429 (C.A.). [46] The Union relies upon the decision of Canada (Director of Investigation and Research) v. Southam Inc., [1997] 1 S.C.R. 748, 144 D.L.R. (4th) 1 for a general definition of what constitutes a patently unreasonable error of law. The Court stated as follows at paragraph 57: The difference between "unreasonable" and "patently unreasonable" lies in the immediacy or obviousness of the defect. If the defect is apparent on the face of the tribunal's reasons, then the tribunal's decision is patently unreasonable. But if it takes some significant searching or testing to find the defect, then the decision is unreasonable but not patently unreasonable. As Cory J. observed in Canada (Attorney General) v. Public Service Alliance of Canada, [1993] 1 S.C.R. 941, at p. 963, "[i]n the Shorter Oxford English Dictionary 'patently', an adverb, is defined as 'openly, evidently, clearly'". This is not to say, of course,

that judges reviewing a decision on the standard of patent unreasonableness may not examine the record. If the decision under review is sufficiently difficult, then perhaps a great deal of reading and thinking will be required before the judge will be able to grasp the dimensions of the problem. See National Corn Growers Assn. v. Canada (Import Tribunal), [1990] 2 S.C.R. 1324, at p. 1370, per Gonthier J.; see also Toronto (City) Board of Education v. O.S.S.T.F., District 15, [1997] 1 S.C.R. 487, at para. 47, per Cory J. But once the lines of the problem have come into focus, if the decision is patently unreasonable, then the unreasonableness will be evident. [47] In the Union's opinion, Lockwood Bros. is patently and obviously the successor to Trivern. It perceives the Board as misapplying the principles in Lyric, despite purporting to follow it. The essence of its argument is that the Board paid to much attention to some of the relevant factors and too little to others. However, it seeks to elevate that complaint to an allegation "that proper considerations were abandoned wholesale or manifestly distorted" - McEwen J.'s description of a clearly irrational decision in CUPE, Local 561. In my view, the Board cannot be said to have either abandoned wholesale, or manifestly distorted, the proper considerations. Conclusion: [48] The Original Panel was well within its jurisdiction to

determine the issues under s. 35 of the Code. I am not persuaded that it committed patently unreasonable errors of fact or law. In spite of the fact that, as the Board noted, it was "a close call", the evidence is clearly capable of supporting the Board's decision that Lockwood Bros. is not a successor to Trivern. Such a conclusion cannot be characterized as "clearly irrational". [49] It follows that the Reconsideration Panel did not err in denying leave to the Union with respect to its application for reconsideration. The facts were unique and no serious question arose regarding the correctness of the Original Decision. That Panel was entitled to find that the Original Decision was not inconsistent with the principles of the Code and that there was no evidence of a breach of natural justice or procedural fairness. [50] The Union's petition is dismissed with costs to the Respondents. In accordance with its usual practice on judicial review, the Board does not seek costs. "M.J. Allan, J." The Honourable Madam Justice M.J. Allan