Retail, Wholesale Canada, Local 1015 v. Associated Freezers of Canada Ltd.

Retail, Wholesale Canada, Local 1015 v. Associated Freezers of Canada Ltd. Court Court of Appeal Date 1996-05-23 Citation 1996 NSCA 129 Docket CA 122927 Judge/Registrar/Adjudicator Flinn, Edward J. (Honourable Justice); Matthews, Kenneth M., (Honourable Justice); Roscoe, Elizabeth A. (Honourable Justice) (CA) Document Type Decision Decision Content C.A. No. 122927 NOVA SCOTIA COURT OF APPEAL Cite as: Retail, Wholesale Canada, Local 1015 v. Associated Freezers of Canada Ltd., 1996 NSCA 129 Roscoe, Matthews and Flinn, JJ.A. BETWEEN: RETAIL, WHOLESALE CANADA, LOCAL ) Ronald A. Pink, Q.C. 1015 (Division of U.S.W.A.) ) for the Appellant Appellant ) ) - and - ) ) John C. MacPherson, ) Richard N. Rafuse, Q.C. and ) J. René Gallant ) for the Respondent COOPERS & LYBRAND LIMITED ) in its capacity as Trustee in Bankruptcy ) of the Estate of Associated Freezers of ) Canada Inc. ) ) Respondent ) Appeal Heard: ) May 16, 1996 ) ) ) Judgment Delivered: ) May 23, 1996 ) ) ) ) ) ) ) ) THE COURT: Appeal dismissed per reasons for judgment of Flinn, J.A.; Matthews and Roscoe, JJ.A. concurring. FLINN, J.A.: The appellant, prior to the bankruptcy of Associated Freezers of Canada Inc. (Associated), was the bargaining agent for Associated's employees. After Associated was petitioned into bankruptcy, the appellant applied to the Labour Relations Board of Nova Scotia for a declaration that the trustee in bankruptcy, the respondent, was bound by the terms of a collective agreement made, prior to bankruptcy, between the appellant and Associated. The appellant was relying upon the successor/employer provisions of the Trade Union Act, R.S.N.S. 1989, c. 475. Section 31 of the Trade Union Act provides that the purchaser, lessee or transferee of a business is bound by the provisions of a collective agreement, between that business and its employees, unless the Labour Relations Board otherwise directs. It reads as follows: "31(1) Where an employer sells, leases or transfers or agrees to sell, lease or transfer his business or the operations thereof or any part of either of them and either (a) the employer or the purchaser, lessee or transferree or any of them is a party to or is bound by a collective agreement with a bargaining agent on behalf of any employees affected by the sale, lease or transfer or contract; unless the Board otherwise directs, the collective agreement, certification, application, notice or entitlement to give notice continues in force and is binding upon the purchaser, lessee or transferee." On application by the respondent to the Supreme Court of Nova Scotia, Justice J. Michael MacDonald ordered a stay of the proceedings before the Labour Relations Board. He decided that there was, in existence, a valid order of the Ontario Court of Justice (General Division), with jurisdiction over this issue. The appellant appeals Justice MacDonald's decision. The bankruptcy of Associated, and its related companies, (who are referred to as Odyssey, Polar-Freez, 606327 and Weston) came about through an order of Mr. Justice Spence of the Ontario Court (General Division) dated April 21st, 1995. In Ontario, it is the Ontario Court (General Division) that is invested with jurisdiction in bankruptcy matters under s. 183(1) of the Bankruptcy and Insolvency Act, R.S. 1985, c. B-3 (the Bankruptcy Act). Among other things, the order of Mr. Justice Spence of the Ontario Court provides as follows: "7. THIS COURT ORDERS that, upon the bankruptcy of each of Odyssey, Associated, Polar Freez, 606327 and Weston, the employment of their respective employees will be terminated by reason of such bankruptcy and the Receiver, in its capacity as trustee in bankruptcy of each of Odyssey, Associated, Polar Freez, 606327 and Weston, is hereby authorized to offer new employment to any or all of the employees of those entities on a temporary basis. 8. THIS COURT ORDERS that the Receiver, in its capacities as receiver of Odyssey and Weston and trustee in bankruptcy of each of Odyssey, Associated, Polar Freez, 606327 and Weston, shall not, by virtue of this Order, the assignments in bankruptcy or receiving order contemplated by this Order, the performance of its rights, duties and obligations under this Order or under the assignments or receiving order or by the engagement of any or all of the employees of the said entities, be or be deemed to be a successor employer within the meaning of any legislation, federal, provincial or otherwise, which may have application in any jurisdiction in which any of the business and assets are situate or pursuant to any agreement with any union or employee." The trustee in bankruptcy advised the employees of Associated, in Dartmouth, Nova Scotia, that it intended to operate Associated's cold storage warehouses, in Dartmouth, for a short period of time while the trustee attempted to find a purchaser. To that end the trustee hired the former employees of Associated on a short term, and temporary basis. However, the trustee refused to acknowledge that it was bound by the collective agreement made between the appellant and Associated; it refused to deduct weekly union membership dues, and remit those dues to the appellant; and it refused to deduct and remit a portion of the employees' pay for a pension plan administered by the appellant union. It was these postions which the trustee took, which led to the application by the appellant to the Labour Relations Board. Several of the appellant's grounds of appeal relate to comments which Justice MacDonald made by way of obiter dicta. The basis upon which Justice MacDonald ordered a stay of the proceedings before the Labour Relations Board was his decision that the order of Mr. Justice Spence of the Ontario Court (General Division) was "a valid order of the Ontario Court with jurisdiction over this issue". He concluded that by virtue of s. 188 of the Bankruptcy Act the Supreme Court of Nova Scotia must enforce Mr. Justice Spence's order; and, therefore, the appellant's application to the Labour Relations Board must be stayed. In my opinion Justice MacDonald was correct in this conclusion. Section 188(1) of the Bankruptcy Act provides as follows: "An order made by the court under this Act shall be enforced in the courts having jurisdiction in bankruptcy elsewhere in Canada in the same manner in all respects as if the order had been made by the court hereby required to enforce it." In The 1996 Annotated Bankruptcy and Insolvency Act (1996), Carswell, Houlden & Morawetz, the authors state the following with respect to s. 188 of the Bankruptcy Act: "The Bankruptcy Act is a federal statute, and it is desirable that, as far as possible, the bankruptcy courts of the different provinces should cooperate with each other in the enforcement of the statute. Section 188 is designed to facilitate that cooperation." Contrary to the submission of counsel for the appellant, Justice MacDonald does not have jurisdiction to review, rescind or vary the order of Mr. Justice Spence of the Ontario Court (General Division); nor, indeed, does the Nova Scotia Labour Relations Board have such jurisdiction. It is only the Ontario Court (General Division) which has such jurisdiction. Section 187(5) of the Bankruptcy Act provides as follows: "Every court may review, rescind or vary any order made by it under its bankruptcy jurisdiction." {Emphasis added} With respect to the other matters raised on this appeal, and arising out of the comments of Justice MacDonald by way of obiter dicta, I express no opinion. I would, therefore, dismiss the appeal. I would order that the respondent have its costs of this appeal which I would fix at $2,000 inclusive of disbursements. Flinn, J.A. Concurred in: Matthews, J.A. Roscoe, J.A. C.A. No. 122927 NOVA SCOTIA COURT OF APPEAL BETWEEN: RETAIL, WHOLESALE CANADA LOCAL 1015 (Division of U.S.W.A.) ) ) Appellant ) - and - ) REASONS FOR ) JUDGMENT BY: COOPERS & LYBRAND LIMITED, ) in its capacity as Trustee in Bankruptcy ) FLINN, J.A. of the Estate of Associated Freezers ) of Canada Inc. ) ) ) Respondent ) ) ) ) ) ) )