in the supreme court of british columbia · danny helgesen. respondent . before: the honourable mr....
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IN THE SUPREME COURT OF BRITISH COLUMBIA
Citation: Gulf Coast Materials Ltd. v. Helgesen, 2010 BCSC 1169
Date: 20100820 Docket: S100560
Registry: Vancouver
Re: Sections 2, 3 and 7 of the Judicial Review Procedure Act, R.S.B.C. 1996, c. 241 and the Decision of the Employment Standards Tribunal
dated November 26, 2009
Between:
Gulf Coast Materials Ltd. Petitioner
And
Danny Helgesen Respondent
Before: The Honourable Mr. Justice Davies
On judicial review from Employment Standards Tribunal Decisions BC EST #D077/09 dated July 20, 2009, and BC EST #RD123/09 dated
November 26, 2009
Reasons for Judgment
Counsel for the Petitioner: D. Lunny M.E. Baird
Counsel for the Respondent, Danny Helgesen:
M. Cooperwilliams
Counsel for the Respondent, Employment Standards Tribunal:
J.M. O’Rourke
Counsel for the Respondent, The Director of Employment Standards:
A.J. Adamic
Place and Date of Trial/Hearing: Vancouver, B.C. April 14, April 26–28, and
May 20–21, 2010
Place and Date of Judgment: Vancouver, B.C. August 20, 2010
TABLE OF CONTENTS
Paragraph Range
I. INTRODUCTION [1]–[3]
II. BACKGROUND CIRCUMSTANCES [4]–[21]
III. THE COMPLAINT AND THE DIRECTOR’S INVESTIGATION
[22]–[39]
IV. THE DIRECTOR’S DETERMINATION [40]–[50]
V. APPEALS OF THE DIRECTOR’S DETERMINATION [51]–[57]
VI. THE TRIBUNAL DECISION [58]–[61]
VII. GULF COAST’S REQUEST FOR RECONSIDERATION [62]–[67]
VIII. THE RECONSIDERATION DECISION [68]–[71]
IX. ANALYSIS AND DISCUSSION [72]–[211]
(A) The standard of review applicable in this proceeding including consideration of whether s. 57 of the Administrative Tribunals Act bars judicial review of the Tribunal Decision
[81]–[115]
1. Reviewability of the Director’s Determination and the Director’s Recalculation Determination
[84]–[88]
2. Reviewability of the Tribunal Decision: s. 57 of the Administrative Tribunals Act
[89]–[107]
3. The standard of review applicable to the Reconsideration Decision
[108]–[115]
(B) Alleged breaches of natural justice and procedural unfairness
[116]–[141]
1. The Tribunal’s failure to hold an oral hearing [118]–[119]
2. The Tribunal’s reliance on submissions from individuals not party to the Complaint
[120]–[121]
TABLE OF CONTENTS
Paragraph Range
3. The Reconsideration Tribunal’s refusal to reconsider the Tribunal Decision because of alleged abuse of process
[122]–[123]
4. The Reconsideration Tribunal’s alleged failure to provide adequate reasons
[124]–[127]
5. The Reconsideration Tribunal’s refusal to hold an oral hearing
[128]–[130]
6. The Reconsideration Tribunal’s refusal to consider new evidence
[131]–[133]
7. Allegations of inadequate investigation [134]–[141]
(C) Alleged errors of fact, law, or mixed law and fact made by the Director and allegedly perpetuated in the Tribunal Decision and the Reconsideration Decision unrelated to alleged breaches of natural justice
[142]–[152]
(D) Alleged errors concerning “corporate governance” and other alleged errors in the Director’s Determination and the Tribunal Decision that have resulted in findings that Mr. Helgesen is an employee of Gulf Coast and is owed wages by it
[153]–[175]
(E) The refusal of the Reconsideration Tribunal to consider new evidence and reconsider the Tribunal Decision
[176]–[194]
(F) Interpretation of s. 80(1) of the Employment Standards Act
[195]–[211]
X. CONCLUSION [212]–[216]
I. INTRODUCTION
[1] This judicial review application requires the determination of two principal
questions:
1) Is an unwanted worker entitled to payment of wages under the provisions
of the Employment Standards Act, R.S.B.C. 1996, c. 113?
2) If so, do the provisions of the Employment Standards Act allow an award
of almost $93,000 to be given to that unwanted worker when the amount
claimed in the complaint that he filed was $11,423.07?
[2] The determination of these questions in this proceeding requires the
consideration of a series of relatively simple facts in the context of complex, often
confusing, and sometimes counter-intuitive principles of administrative law in a
situation involving three levels of administrative decision making.
[3] The analysis requires that each level of decision making be viewed through
the looking-glass of the mandated standards of judicial review as well as internal and
legislative bars to review. That such analysis may result in a descent through a
rabbit hole to an alternate reality is of no consequence, provided that the alternate
reality is not a patently unreasonable one.
II.
[4] The petitioner, Gulf Coast Materials Ltd. (“Gulf Coast”) is a British Columbia
corporation which, in addition to other business interests, operates a ready mix
cement plant on Salt Spring Island.
BACKGROUND CIRCUMSTANCES
[5] Two brothers, Bhora Mayer and Mhinder Mayer are each 50% shareholders of
Gulf Coast. They are respectively its president and secretary.
[6] In 2007, Bhora Mayer and Mhinder Mayer were involved in many business
disputes affecting the operation and governance of the companies in which they had
joint ownership issues, including Gulf Coast.
[7] Before this dispute, the respondent, Danny Helgesen, worked for
approximately 20 years for various companies owned by either Mhinder Mayer or by
both Bhora and Mhinder Mayer.
[8] Prior to the events now in issue, Mr. Helgesen worked for approximately seven
years in Nanaimo for D & A Crushing Ltd., a company owned by Mhinder Mayer’s
wife, Kelly Mayer. Bhora Mayer had no interest in D & A Crushing Ltd.
[9] Before his employment with D & A Crushing Ltd., Mr. Helgesen had been
employed by Gulf Coast for approximately two years at its Salt Spring Island plant.
[10] In mid-2007, D & A Crushing Ltd. lost a contract which had supported
Mr. Helgesen’s employment in Nanaimo.
[11] On October 13, 2007, Mr. Helgesen was laid off by D & A Crushing Ltd.
[12] Mhinder Mayer then offered Mr. Helgesen full-time salaried employment with
Gulf Coast at its Salt Spring Island plant, to start on October 15, 2007.
[13] Bhora Mayer did not, however, want Danny Helgesen as a Gulf Coast
employee.
[14] On October 11, 2007, just before Mr. Helgesen was laid off by D & A Crushing
Ltd., Bhora Mayer sent a letter to Mhinder Mayer in which he stated:
Mhindy, I understand that you still have D&A employees working at GCM Saltspring Island. Prior to you starting renovations to the ready mix plant both Marc and I asked you to provide estimates for your choice to manufacture a plant yourself verses purchasing a new or good used plant. We stressed to you that it was important to provide the information prior to starting. I am also aware that you have carried on with your own agenda and without approval.
More recently I met you at the GCM plant on Rainbow road, and noticed D&A employees at the site. At that time I told you the company was not going to pay D&A invoices as approved by you. I also told you that Dan Allarie and Dan Helgesen should not be working for GCM. I understand they are still there, so I am insisting again that these D&A employees not be allowed to work at the GCM Ganges operations.
I am willing to hold a directors meeting to formalize this and other issues in regards to GCM business if it is your pleasure. Please respond.
[15] On October 15, 2007, Mr. Helgesen attended at Gulf Coast’s Salt Spring
Island plant as directed by Mhinder Mayer.
[16] On October 17, 2007, Bhora Mayer wrote another letter to Mhinder Mayer in
which he stated:
Further to my earlier written notice to you and my discussion with you on the phone this morning, Dan Helgesen will not be hired by Gulf Coast Materials. There are several reasons for my decision, but let me give you two:
I understand that you have had Dan operate a concrete pump truck that is not safe to operate. Both rear outriggers are faulty, and there are substantial cracks in the pump and truck chassis that have not been repaired. As far as I am concerned an individual who has no regard for his own safety (let alone the safety of others who have to work under an unsafe boom) has no place in our business.
I also understand that you have asked Dan to delete information off the computer, and that Dan has confirmed to you that he knows how (and is willing) to change or eliminate information in the plant computer.
Accordingly, either you tell Dan to leave immediately or I will give him formal notice to leave the premises. I request your reply immediately.
[17] On October 18, 2007, Bhora Mayer, as president of Gulf Coast, had a letter
hand delivered to Mr. Helgesen stating:
This letter is to remind you that you are NOT an employee of Gulf Coast Materials, and that I will not authorize you to be hired by Gulf Coast Materials.
This is also a formal notice that, unless you receive written authorization from me, you are no longer allowed to enter our property at 345 Rainbow Road, Ganges. Should you fail to respect this notice, the appropriate authorities will be contacted and you will be charged with trespassing.
[18] On October 18, 2007, Bhora Mayer also sought the assistance of the Royal
Canadian Mounted Police (“RCMP”) to “assist in the removal of an employee.” The
RCMP officer who attended Gulf Coast’s Salt Spring Island plant recorded a
synopsis of the event stating that he was “told that his was not a police matter and
the police would not be forcing the employee to leave the property.”
[19] Also on October 18, 2007, Bhora Mayer, as president of Gulf Coast, wrote to
the payroll company responsible for the processing of Gulf Coast’s employees’
wages stating:
This letter is to confirm that Mr. Helgesen has NOT been hired by Gulf Coast Materials, that there are no wages owing to him, further if there is time submitted on his behalf it is not to be entered on Gulf Coast Materials payroll.
Should anyone make any claims to the contrary or attempt to convince you otherwise, please simply tell them to contact me personally.
[20] On October 19, 2007, Bhora Mayer, as president of Gulf Coast, wrote another
letter to Mr. Helgesen, hand delivered that day, this time stating:
As you are aware, I am the President of Gulf Coast Materials. As President, I advised you in person yesterday that you are not employed by Gulf Coast.
Please take this letter as confirmation of that statement. My brother Mhinder has no authority to hire you unilaterally, and I have advised him of this.
Whatever Mhinder may have told you, I am telling you now that you are not employed by the company and not on the company’s payroll. Please govern yourself accordingly.
[21] Notwithstanding that series of events and the fact that he was never entered
onto Gulf Coast’s payroll and never paid by Gulf Coast for any work he did at its Salt
Spring Island plant, Mr. Helgesen continued to attend at the plant under the direction
of Mhinder Mayer.
III. THE COMPLAINT AND THE DIRECTOR’S INVESTIGATION
[22] Mr. Helgesen’s complaint (the “Complaint”), seeking payment of wages from
Gulf Coast as his employer, was filed with the Director of Employment Standards
(the “Director”) on January 8, 2008.
[23] In the Complaint, Mr. Helgesen claimed wages of $11,423.07 and stated that:
1) Mhinder Mayer was his supervisor;
2) He had been employed by Gulf Coast starting on October 15, 2007, and
had “not received payment for services rendered”; and
3) The last day he worked for Gulf Coast was December 31, 2007.
[24] When the Complaint was filed, the Director appointed Mr. Terry Hughes, an
industrial relations officer, as his delegate (the “Delegate”) to investigate
Mr. Helgesen’s allegations and determine whether Gulf Coast had contravened the
provisions of the Employment Standards Act by failing to pay Mr. Helgesen wages
owed to him.
[25] The Delegate conducted an investigation over a period of several months.
[26] During that investigation, Mr. Helgesen continued to do work at Gulf Coast’s
Salt Spring Island cement plant without ever being paid by Gulf Coast.
[27] Concerning Mr. Helgesen’s continued attendance at the Gulf Coast plant after
the filing of the Complaint, Bhora Mayer’s lawyer wrote Mr. Helgesen on February 7,
2008, stating:
We are counsel for Bhora Mayer. Our client, as you are aware, is one of the owners of Gulf Coast Materials Ltd. He has received a notice from Employment Standards that you have filed a complaint against Gulf Coast Materials, to the effect that you have not received wages since October 15, 2007.
We are informed by our client that you were advised by him, in no uncertain terms, on October 18, 2007, that you are not employed by Gulf Coast Materials. Our client hand delivered to you at that time a letter to that effect. Please take this letter as our client's reiteration of his position.
It is our understanding that you are in fact an employee of D&A Crushing Ltd., which is controlled by our client's brother, Mhinder Mayer, and his wife, Kelly Mayer. You should look to that company for your remuneration, not Gulf Coast Materials.
[28] During the Delegate’s investigation, Mr. Helgesen, Mhinder Mayer and his
wife Kelly Mayer each represented to the Delegate that Kelly Mayer was personally
loaning Mr. Helgesen the equivalent of the wages he should have been paid by Gulf
Coast.
[29] The Delegate’s investigation included receiving information and submissions
from Mr. Helgesen as well as from Mhinder Mayer and Bhora Mayer, and from
lawyers representing each of them.
[30] In those submissions, Mhinder Mayer supported Mr. Helgesen’s position that
Mhinder Mayer had hired him on behalf of Gulf Coast and supervised his work for
Gulf Coast. His lawyer also asserted that Mhinder Mayer had the authority to do so
as a 50% owner of Gulf Coast, and that Mr. Helgesen was entitled to rely on that
authority.
[31] Bhora Mayer and his lawyer informed the Delegate of Bhora Mayer’s refusal
to authorize Mhinder Mayer to employ Mr. Helgesen as an employee of Gulf Coast,
and provided copies of Bhora Mayer’s letters documenting that refusal, to which I
have referred.
[32] Bhora Mayer and his lawyer also submitted that Mhinder Mayer had no
authority to override Bhora Mayer’s corporate decision-making power as the
president of Gulf Coast, and took the position that if Mr. Helgesen was an employee,
his employer was Mhinder Mayer or D & A Crushing Ltd., not Gulf Coast.
[33] On July 25, 2008, the Delegate issued a report concerning the Complaint, as
well as a complaint brought by another alleged employee of Gulf Coast. In that
report, the Delegate stated that:
Based on the information and evidence before me to date I am satisfied of the following … Mhinder Mayer hired Danny Helgesen to work for Gulf Coast. Bhora Mayer told Danny Helgesen in October 2007 he was not hired or to be working for Gulf Coast. Mhinder Mayer told Danny Helgesen to ignore Bhora Mayer and that he was hired by Gulf Coast and to perform work at an agreed salary. Mhinder Mayer advised Danny Helgesen he was employed by Gulf Coast and he (Mhinder) would work it out with his brother Bhora. Mhinder Mayer’s wife has been loaning Danny Helgesen the equivalent of his net wages each month.
[34] In that report, the Delegate also stated:
The complainants have clearly both been working and providing their labour at the operation of Gulf Coast Materials Ltd. They have both been performing the work normally done by employees of Gulf Coast Materials Ltd. They have been allowed, directly and indirectly to perform work of employees. Gulf Coast has benefited from their labour.
The employees of Gulf Coast view Mhinder Mayer as a person of authority within the company. Mhinder Mayer controls and directs employees and manages the day to day business. He makes decisions involving hiring, scheduling, supervising and directing employees. Mhinder Mayer owns 50% of the company and is a director and officer.
I find the complainants are entitled to receive the wages and conditions of employment agreed to be provided to them by Mhinder Mayer, on behalf of Gulf Coast Materials Ltd.
Based on the information provided to date, it is my finding that Danny Helgesen has been an employee of Gulf Coast Materials Ltd. since October 15, 2007 and that he is owed for the wages that he was promised by Mhinder Mayer representing Gulf Coast Materials Ltd.
[35] The Delegate urged the parties to resolve their disputes and also advised that
if no agreement was reached, he would issue a formal determination under the
provisions of the Employment Standards Act, which would require the imposition of
penalties in addition to any wages found owing.
[36] The dispute continued without resolution, and the Delegate received further
submissions from Bhora Mayer and Mhinder Mayer and their respective lawyers,
reiterating their positions as earlier advanced.
[37] The Delegate also undertook some investigation into the “loans” from Kelly
Mayer. He did so because Bhora Mayer and his counsel suggested that:
1) The receipt of those funds undermined the bona fides of the Complaint
against Gulf Coast, since Mr. Helgesen had in fact been “paid” for his
work; and
2) Mhinder Mayer was supporting Mr. Helgesen in the Employment
Standards Act process to off-load corporate responsibility for wages from
D & A Crushing Ltd. onto Gulf Coast.
[38] On December 16, 2008, Mr. Helgesen filed a second complaint with the
Director for wages allegedly owed to him by Gulf Coast prior to that date.
[39] No steps were ever taken by the Director concerning that second complaint.
IV. THE DIRECTOR’S DETERMINATION
[40] On February 24, 2009, the Delegate delivered his determination of the
Complaint (the “Director’s Determination”), finding on behalf of the Director that Gulf
Coast had contravened s. 17 of the Employment Standards Act by failing to pay
wages to Mr. Helgesen, and ordering Gulf Coast to pay Mr. Helgesen $33,369.35
(inclusive of interest in the amount of $1,292.51). He also imposed an administrative
penalty of $500 which he ordered be paid to the Director, within five days.
[41] In reasons filed with the Director’s Determination as required by s. 81 of the
Employment Standards Act, the Delegate stated that the issues for determination
were:
1. Is Danny Helgesen an employee?
2. If yes, is he an employee of Gulf Coast Materials Ltd.?
3. If yes, what wages are owed?
[42] Amongst other things, in his reasons the Delegate recorded the following as
“Background and Evidence”:
Gulf Coast Materials Ltd. operates a ready mix plant on Salt Spring Island. Gulf was incorporated and has operated since about 1970. The two directors of the company are brothers: Bhora ("Bhora") Mayer and Mhinder (“Mhinder”) Mayer. Each is a 50% owner of Gulf. Bhora is noted on the BC Company registry as President, and Mhinder as Secretary.
Bhora and Mhinder are also involved as joint owners and directors of other businesses located on Vancouver Island. They also have business interests and corporations independent of each other.
Bhora and Mhinder have not been getting along particularly well on a number of business issues. This includes the matter of Danny Helgesen. The dispute that is the subject of this Determination is primarily between Bhora and Mhinder. Mhinder supports the employment and claim of Danny, and Bhora does not.
…
Mhinder wanted Danny to go back to work at Gulf, as he was perceived as a valuable and experienced long term employee, and Mhinder was not satisfied with the operation of Gulf at that time. Mhinder offered Danny full time salaried employment with Gulf starting on October 15, 2007.
Bhora did not want Danny to be hired back at Gulf. On October 11, 2007 Bhora wrote Mhinder a letter and advised that D & A employees should not be at the Gulf site, and that Danny should not be working for Gulf.
On October 17, 2007 Bhora wrote a letter to Mhinder advising he did not agree with the hiring of Danny. He asked to have Danny leave the premises immediately.
On October 18, 2007 Bhora visited the site and hand delivered a letter to Danny advising he was not an employee and was to leave the site immediately. He was advised he was to not enter the premises, and was told he would be charged with trespassing if he did.
On October 19, 2007 Bhora wrote another letter to Danny advising he was not employed by the company and would not be put on payroll.
Bhora wrote a memo to Bastion Management on October 18, 2007 indicating that Danny was not to be paid any wages.
Mhinder told Danny in October 2007 to ignore Bhora's directions, and that he was hired and employed by Gulf. Mhinder signed a payroll request form and sent it to Bastion to start Danny as a full time employee effective October 15, 2007 at the rate of $5,500.00 per month. This was the same rate of pay that had been paid to Danny before his layoff with D & A.
Mhinder told Danny that he was an owner of Gulf, and that he had authority to hire Danny. Mhinder told Danny that he would resolve the problem between himself and Bhora.
Mhinder and Danny indicate that Danny has worked full time at Gulf since October 15, 2007. Danny has never received any wages from Gulf. Danny is still working at the Gulf yard on Salt Spring Island.
Mhinder has not been able to arrange processing of wages for Danny by the Bastion payroll services.
Mhinder has been the brother who has had the most day to day direction and involvement with the employment of Danny over the years. Mhinder has also had the most direct involvement with the operation of the Gulf ready mix business on Salt Spring Island.
…
The accounting and payroll management for Gulf is handled by Bastion Management Ltd. ("Bastion"). Bastion is controlled by Richard Mayer, the son of Bhora.
Gulf sends their payroll information, such as employee hours, hiring information, and wage rate changes to Bastion. Bastion processes the payroll for Gulf, including making payroll deductions and direct deposits.
The signing authorities on the Gulf payroll account are Bhora, Mhinder, and a senior accountant working at Bastion. The bank apparently requires two signatures to process payments.
Since payroll is done from Bastion, and Bastion is aligned to Bhora's group of companies, Bhora has the ability to make and control wage payments and deposits. Mhinder has no independent authority to have pay cheques issued to an employee.
As Danny required funds to live, Danny says that Kelly Mayer has agreed to loan him the equivalent of the net wages he should be paid by Gulf. Danny has provided examples of copies of personal cheques received from Kelly Mayer that indicate "loan" in the amount of $1,955.00. There is no written agreement regarding this loan.
Kelly Mayer says these payments are temporary loans, on the understanding that when the wage dispute with Gulf is resolved, these funds will have to be paid back by Danny.
There have been no payroll remittances to Canada Revenue Agency, and apparently no WCB remittances for Danny since October 2007.
…
Bhora has not provided any specific evidence to indicate that Danny has been doing work for D & A, or any other business owned by Mhinder or Kelly. Bhora has also not provided any evidence to indicate that Danny is not
In March 2008 Bhora attended at the Gulf site for a few days while Mhinder was out of town. Danny indicated Bhora observed him working for Gulf at the Gulf site doing his normal duties. Danny alleges that at one point Bhora commented to him that it "was good that I was working for nothing."
working at and for Gulf at the Salt Spring ready mix plant.
Danny lives In Nanaimo. He says he works full time at Gulf. He takes the 6:30 am ferry from Crofton to Salt Spring, Mondays through Fridays. He usually catches the ferry back between 3:30 pm and 4:30 pm. He indicated he does "a little bit of everything" at Gulf on Salt Spring. He batches (loads) trucks, drives trucks, operates equipment at work sites, and operates the loader at the yard. He does office work including dispatch, ordering, answering phones, dealing with customers and some sales work. He says all of his time is spent working on the business of Gulf Coast.
Several employees have written letters indicating that they have witnessed Danny working regularly for the business of Gulf.
I randomly contacted some employees and asked them to comment on their observations of the role and duties they witnessed being performed by Danny.
[43] Concerning the “Argument of the Complainant,” the Delegate recorded in his
reasons:
Danny says he has worked fulltime performing only the work of Gulf Coast since he was hired by Mhinder Mayer on October 15, 2007. He says Mhinder Mayer is the owner and director of Gulf Coast who is involved in the day to day operation of Gulf Coast. Mhinder Mayer told him he was hired to work fulltime for a monthly salary of $5,500.00.
Danny says that when Bhora Mayer told him in October 2007 that he should cease work for Gulf Coast, Mhinder Mayer said to him he was one half owner and manager of the business and that he should ignore his brother and that he would try to work it out. He says he is being loaned monies from Kelly Mayer and has not received wages from Gulf Coast. He has not had payroll tax deductions, and has not had employer remittances made on his behalf for workers compensation. He indicates he is very concerned about this entire situation.
Danny indicates he is working only for Gulf Coast Materials, is an employee and has not been paid wages that were promised to him.
[44] Concerning the “Argument of the Employer,” the Delegate wrote:
Each of the two directors of Gulf Coast has a different argument.
Mhinder Mayer supports the complaint of Danny Helgesen. He says he hired Danny to work at Gulf Coast and that Danny has worked fulltime at Gulf Coast since he was hired on October 15, 2007. He says Danny is a valuable employee of Gulf.
Mhinder Mayer
He says that he told Danny he was hired by Gulf and to ignore Bhora and that he would try and work things out with his brother.
Counsel for Mhinder says that the "indoor management rule" applies in these circumstances. This common law rule says that third parties are entitled to rely on the management of the company, and not concern themselves about disputes between directors. Mhinder says that Danny has relied on what he has told Danny about his hiring and employment with Gulf.
He says that it is unfortunate that Danny has been caught in the middle of the dispute between himself and Bhora.
Bhora Mayer says that Danny Helgesen was told early on that he was not hired and was not to work at Gulf Coast Materials. Bhora says that Danny should not have worked at Gulf, and that Mhinder should not have allowed Danny to work at Gulf.
Bhora Mayer
Bhora says that Mhinder had no unilateral authority to hire and fire employees - without Bhora's consent, which was never provided.
Bhora also alleges that Danny may not have being doing work for Gulf, but rather D & A Crushing Ltd.
Bhora says it would be unreasonable to expect him to take legal action to have Danny physically removed from the premises of Gulf. He says this would be a further waste of resources.
[45] In his “Findings and Analysis,” the Delegate first found Mr. Helgesen to be an
employee as defined by the provisions of the Employment Standards Act, and next
went on to determine that Mr. Helgesen was an employee of Gulf Coast.
[46] In making that latter finding, the Delegate wrote:
Mhinder Mayer is a 50% owner of Gulf. He is the director with the most day to day involvement in running the Gulf operation. He told Danny Helgesen he was hired by Gulf and to work. He told Danny to ignore his brother and he would sort out their internaI squabbles. Danny relied on that information and has been providing his labour to Gulf. All of the evidence provided in this investigation indicates Danny is actually working for Gulf fulltime. Gulf has benefited from that labour.
There is no evidence to indicate Danny has been working for D & A or any other business, other than Gulf.
Bhora told Danny in writing on October 18, 2007 he would have him charged with trespassing and removed from the premises if he did not leave the site immediately. Danny has worked fulltime to date and been allowed to work. The only action taken is a refusal to process the payment of wages.
Employees are entitled to rely on the direction and instructions of a senior manager and 50% owner of a business. I find Gulf has "directly or indirectly" been responsible for the employment of Danny Helgesen.
I find Danny Helgesen has been an employee of Gulf Coast Materials Ltd. since October 15, 2007.
This is an unfortunate situation for all parties. Danny Helgesen appears caught in the middle of the dispute between Bhora and Mhinder. This situation needs to be fixed as it relates to Danny Helgesen's employment as it is current and ongoing.
[47] In determining what wages were owed to Mr. Helgesen, the Delegate found
that the loans from Kelly Mayer were personal loans, and not wages.
[48] The Delegate then went on to consider the provisions of s. 80(1) of the
Employment Standards Act, which provides:
80 (1) The amount of wages an employer may be required by a determination to pay an employee is limited to the amount that became payable in the period beginning
(a) in the case of a complaint, 6 months before the earlier of the date of the complaint or the termination of the employment, and
(b) in any other case, 6 months before the director first told the employer of the investigation that resulted in the determination,
plus interest on those wages.
[49] In interpreting those provisions, the Delegate stated:
The Director’s interpretation of Section 80 is that if employment is ongoing, recovery of wages is limited to wages that became payable in a six month period. Danny Helgesen continued to be employed after the complaint was filed. As a result the audit period in this Determination is limited to the wages that became payable from October 15, 2007 to April 15, 2008.
[50] In determining the amount owing for the period from October 15, 2007, to
April 15, 2008, the Delegate relied on a spreadsheet prepared by Ms. Judy
Gallacher, the bookkeeper for D & A Crushing Ltd.
V. APPEALS OF THE DIRECTOR’S DETERMINATION
[51] On April 1, 2009, Mr. Helgesen filed an appeal of the Director’s Determination
to the Employment Standards Tribunal (the “Tribunal”) on the grounds that:
I don’t agree with the director’s interpretation of section 80.
My claim was submitted in January 2008 and took over one year for a determination to be made.
When I filed my claim in the Nanaimo office I asked if I needed to continue to file claims on an ongoing basis. I was told that I only need to file a claim once.
I think in this case because I am still employed at GCM; the six month period should be extended.
[52] On April 3, 2009, Bhora Mayer and Gulf Coast also filed an appeal of the
Director’s Determination to the Tribunal under s. 112 of the Employment Standards
Act, stating that:
The grounds of appeal are:
(a) The Director erred in law by applying the “indoor management rule” to determining whether Helgesen was employed by Gulf;
(b) The Director erred in law by misapplying the test of whether Helgesen was an employee.
[53] On June 2, 2009, Mr. Helgesen filed a third complaint with the Director. That
third complaint has also not been acted upon by the Director.
[54] In correspondence dated June 11, 2009, the Delegate advised the Tribunal of
the Director’s intention to “await the outcome of the appeal” before considering that
complaint as well as Mr. Helgesen’s second complaint (filed December 16, 2008).
[55] In correspondence to the Tribunal in June of 2009 from counsel for Mhinder
Mayer and from Mr. Helgesen (in virtually identical words and tone), each objected
to counsel for Bhora Mayer purporting to act on behalf of Gulf Coast in the appeal
process.
[56] Those concerns were not addressed by the Tribunal, and the appeal
proceeded with counsel for Bhora Mayer representing both Bhora Mayer and Gulf
Coast.
[57] On July 20, 2009, Tribunal member K.W. Thornicroft issued a decision (the
“Tribunal Decision”) allowing Mr. Helgesen’s appeal and dismissing the appeal
brought on behalf of Gulf Coast by Bhora Mayer.
VI. THE TRIBUNAL DECISION
[58] In allowing Mr. Helgesen’s appeal, Mr. Thornicroft stated (among other things)
that:
… I find the delegate erred in law by limiting the “recovery period” to a 6-month interval straddling the date Mr. Helgesen’s complaint was filed. I agree with Mr. Helgesen that the Director could have issued an unpaid wage award spanning the period up to the date the Determination was issued. I am not finding that Mr. Helgesen is entitled to a further sum reflecting unpaid wages that were earned and became payable after April 15, 2008 – that entitlement is yet to be established. However, I do say that the delegate erred in law in determining that “recovery of wages is limited to wages that became payable in a six month period”.
[59] In refusing Bhora Mayer’s appeal on behalf of Gulf Coast, Mr. Thornicroft
stated (among other things) that:
As I read the Determination, the delegate did not conclude Gulf Coast was Mr. Helgesen’s employer simply because it benefited from his services. Rather, the delegate considered, in addition, that i) Mr. Helgesen was engaged by a person apparently in a position of authority with Gulf Coast, ii) no person other than Gulf Coast received the benefit of Mr. Helgesen's labours, iii) Bhora Mayer took no formal legal steps to have Mr. Helgesen barred from the workplace, and iv) bearing in mind the relevant statutory definitions, Mr. Helgesen performed work normally performed by an employee and was subject to Gulf Coast's direction and control (exercised through Mhinder Mayer).
The delegate made a finding of fact that Mhinder Mayer was the one brother who was most closely involved in the day-to-day management of Gulf Coast (see Determination, pages R4 and R9) and there is nothing in the material before me calling that finding into question. Indeed, Bhora Mayer does not
challenge that factual determination and, in any event, challenges to findings of fact cannot constitute an error of law unless there is no proper evidentiary foundation for the disputed fact (an issue that does not arise in these appeals). The delegate determined, based on largely uncontroverted evidence, that: i) Mhinder Mayer hired Mr. Helgesen, ii) Mr. Helgesen worked at Gulf Coast's worksite; and iii) he provided services that tangibly benefited Gulf Coast. Mhinder Mayer never purported to engage Mr. Helgesen on behalf of any person other than Gulf Coast and there is no evidence in the material before me to suggest that Mr. Helgesen worked anywhere other than at the Gulf Coast work site on Salt Spring Island. In light of these findings, and the statutory definitions of "employee", "employer" and "work" contained in section 1 of the Act, I am unable to conclude that the delegate's finding that Mr. Helgesen was employed by Gulf Coast during the relevant period constitutes an error of law. Mr. Helgesen was a person who provided labour and other services normally performed by a employee, for the benefit of Gulf Coast, under the direction and control of a Gulf Coast principal (Mhinder Mayer) and with the expectation of reward.
Bhora Mayer's principal concern seemingly relates to the ongoing dispute between himself and his brother regarding the internal affairs of the corporate employer. Bhora Mayer says that he advised Mr. Helgesen that he was "not employed" by Gulf Coast and should not attend the work site; Mhinder Mayer, on the other hand, assured Mr. Helgesen that the latter was properly engaged and would be paid, in due course, for his services. Mhinder Mayer arranged for loans to be made to Mr. Helgesen (given that Bhora Mayer apparently exclusively controlled the Gulf Coast payroll account) to provide Mr. Helgesen with an income stream pending a resolution of the brothers' dispute. I do not think it inappropriate for Mr. Helgesen to have accepted the assurances of a principal of the company (an officer, director, 50% shareholder and the one brother who had the closest contact with the firm's daily operations) that his employment was secure and that he should continue on as a Gulf Coast employee. There are many avenues available for these two brothers to sort out their differences (for example, the dispute resolution procedure in their shareholders' agreement if one exits; the dispute resolution processes embedded in the Business Corporations Act), however, this appeal process is not one such avenue. In short, Mr. Helgesen was an employee who was engaged by, and provided services to, Gulf Coast and the latter firm has not paid him for those services. In such circumstances, a Determination ordering Gulf Coast to pay Mr. Helgesen the wages he has earned (but for which he has never been paid by Gulf Coast) was, in my view, entirely properly issued.
[60] On July 31, 2009, in proceedings in this Court between Bhora Mayer and
Mhinder Mayer involving disputes over the governance of companies (including Gulf
Coast) in which they were both involved, Burnyeat J. determined that the articles of
association of companies in which the Mayers were joint owners provided the
president (Bhora Mayer) a “second or casting vote.” In that proceeding, Burnyeat J.
also approved Bhora Mayer’s appointment of Mr. Lunny to act on behalf of the
jointly-owned companies in disputes with third parties.
[61] The Delegate recalculated the amount owed by Gulf Coast to Mr. Helgesen as
directed by Mr. Thornicroft in the Tribunal Decision, and on August 12, 2009, issued
a new determination (the “Director’s Recalculation Determination”) in the amount of
$92,872.42 for wages owing, including accrued vacation pay as of February 24,
2009, and affirming the $500 penalty previously issued.
VII.
[62] On August 19, 2009, Bhora Mayer and Gulf Coast filed a Request for
Reconsideration (“Reconsideration Application”) of the Tribunal Decision pursuant to
s. 116 of the Employment Standards Act, seeking reconsideration by way of an oral
hearing and a stay of the Director’s Recalculation Determination, on the grounds that
the Tribunal:
GULF COAST’S REQUEST FOR RECONSIDERATION
1) erred in law in finding that Gulf was Mr. Helgesen’s employer;
2) erred in law in finding that Mr. Helgesen was an employee of Gulf;
3) erred in finding that Gulf owed wages to Mr. Helgesen; and
4) erred in law by awarding damages for the period from the date of the
complaint to the date of the determination.
[63] In September of 2009, Mr. Helgesen and Mhinder Mayer filed submissions
opposing the Reconsideration Application.
[64] On October 1, 2009, the Tribunal wrote to counsel for Bhora Mayer and Gulf
Coast, advising that any reply submissions had to be filed by October 16, 2009.
[65] On October 15, 2009, counsel for Bhora Mayer wrote to the Tribunal, stating:
We write in response to your letter of October 1, 2009.
One of the issues which has arisen in this proceeding has been our authority to represent and make submissions on behalf of Gulf Coast Materials Ltd. Mhinder Mayer, in particular, has challenged our authority to do so.
On July 29, 2009, in separate proceedings before the British Columbia Supreme Court, the Honourable Mr. Justice Burnyeat directed that the law firm of Jensen Lunny Maclnnes take instructions from and report to Bhora Mayer on behalf of Gulf Coast Materials Ltd. We enclose a copy of His Lordship's Order.
The Order confirms that Bhora Mayer is authorised to instruct counsel on behalf of Gulf Coast Materials Ltd. and, in particular, is authorised to instruct Jensen Lunny Maclnnes.
Consequently, David Lunny of Jensen Lunny Maclnnes is being instructed by Mr. Mayer on behalf of Gulf Coast Materials Ltd. to prepare the reply to the most recent submissions from the Director of the Employment Standards Branch, Mr. Helgesen and Mhinder Mayer.
[66] Subsequently, after the Tribunal allowed an extension of time to do so,
Mr. Lunny filed a Reply on behalf of Gulf Coast on November 6, 2009.
[67] On November 9, 2009, Mr. Helgesen advised the Tribunal that Mhinder
Mayer’s lawyer could also speak on behalf of Mr. Helgesen in relation to the
submissions filed by Mr. Lunny.
VIII. THE RECONSIDERATION DECISION
[68] On November 26, 2009, Tribunal member D.B. Stevenson (the
“Reconsideration Tribunal”) refused Bhora Mayer and Gulf Coast’s Reconsideration
Application. In doing so, he rejected Gulf Coast’s application for an oral hearing.
[69] In addition, the Reconsideration Tribunal rejected Mr. Lunny’s application on
behalf of Gulf Coast to adduce new evidence including the articles of association of
Gulf Coast and the order of Burnyeat J. of July 31, 2009, made in the corporate
governance proceedings between Bhora Mayer and Mhinder Mayer.
[70] In reasons dismissing Gulf Coast’s Reconsideration Application (the
“Reconsideration Decision”), the Reconsideration Tribunal stated, amongst other
things, that:
46. I have decided this application does not warrant reconsideration.
47. I can find no error of law in the original decision on either of the issues raised.
48. On the issue of the employment relationship, whatever Mhinder Mayer's actual legal authority might be within Gulf Coast, the Determination found he had sufficient authority in the circumstances found to exist at the time to create an employment relationship between Helgesen and Gulf Coast and that the elements of that relationship fell within the relevant statutory definitions of "employee", "employer" and "work".
49. Counsel for Gulf Coast and Bhora Mayer continue to assert in this application that Mhinder Mayer had no actual authority to hire Helgesen to Gulf Coast and, consequently, Helgesen could not have been employed by that company. Those assertions continue to miss the point and, in any event, were reviewed and answered in the original decision. The focus of this application from Gulf Coast and Bhora Mayer has been to provide further argument on the absence of actual authority. In essence, they seek a review and re-weighing of the arguments already made and not accepted. That is not an appropriate use of the reconsideration power given to the Tribunal under section 116.
50. The original decision on the wage recovery period is consistent with the language found in section 80, consistent with the fundamental statutory obligation on an employer to pay wages to an employee for work performed and consistent with the expressed purposes of the Act, with its objectives and with the remedial nature of the legislation. It is the correct decision and reconsideration is both unnecessary and unwarranted.
[71] Gulf Coast filed this Petition for Judicial Review on January 25, 2010.
IX. ANALYSIS AND DISCUSSION
[72] In its argument, counsel for Gulf Coast pursued the following relief:
1) An order quashing the Reconsideration Decision;
2) An order quashing the Tribunal Decision;
3) A declaration regarding the correct interpretation of s. 80 of the
Employment Standards Act;
4) Referral of the Complaint to the Director’s Delegate for an oral hearing;
5) Costs.
[73] It is obvious that the resolution of the dispute between Mr. Helgesen and Gulf
Coast was, unfortunately, hijacked by hard-fought issues concerning the corporate
governance of Gulf Coast and other related ongoing disputes between Mhinder
Mayer and Bhora Mayer, including disputes over the representational status of
counsel before the Delegate and the Tribunal.
[74] The dispute between Mr. Helgesen and Gulf Coast also took on monetary and
legal significance far beyond the scope of the Complaint because of inordinate delay
in what is intended to be a fair and efficient remedial administrative process.
[75] Delay in the processing of an original wage claim of less than $12,000
resulted in the continuation of a situation that ought to have been quickly resolved,
engaged issues of statutory interpretation that should never have been necessary,
and ultimately resulted in an award in excess of $93,000.
[76] In my opinion, the end result defies common sense.
[77] How can it be that a company that refuses to hire a person, tells that person
that he has not and will not be employed by it, attempts to have that person forcibly
removed from its premises and never pays that person, be required to pay wages,
not only for the three-month claim period advanced, but also for an additional almost
15 months thereafter?
[78] That question must be answered by consideration of the various levels of
administrative decision making engaged in the administrative process that yielded
that result, based upon standards of review that require great deference to the
administrative decision-making process at all levels.
[79] In undertaking that analysis, I must not substitute my view of the decision
which I believe would have been correct.
[80] To determine whether Gulf Coast is entitled to any of the relief sought, I will
address the following procedural and substantive issues:
1) The standard of review applicable in this proceeding, including
consideration of whether s. 57 of the Administrative Tribunals Act, S.B.C.
2004, c. 45 bars judicial review of the Tribunal Decision;
2) Gulf Coast’s allegations of breaches of natural justice and procedural
unfairness, including alleged inadequacy of reasons;
3) Gulf Coast’s allegations of inadequate investigation;
4) Gulf Coast’s allegations of errors of fact, law, or mixed law and fact made
by the Director and allegedly perpetuated in the Tribunal Decision;
5) The refusal of the Reconsideration Tribunal to consider new evidence and
its refusal to reconsider the Tribunal Decision; and
6) The interpretation of s. 80 of the Employment Standards Act.
(A) The standard of review applicable in this proceeding including consideration of whether s. 57 of the Administrative Tribunals Act bars judicial review of the Tribunal Decision
[81] Although there is little common ground amongst the petitioner and
respondents on any issue in this proceeding, all parties do agree that the privative
clause in s. 110(2) of the Employment Standards Act and the application of the
Supreme Court of Canada’s decision in Canada (Citizenship and Immigration) v.
Khosa, 2009 SCC 12, [2009] 1 S.C.R. 339 [Khosa], establish that the standard of
review in this proceeding is governed by s. 58 of the Administrative Tribunals Act.
[82] Section 58 of the Administrative Tribunals Act provides
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, and
(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.
(3) For the purposes of subsection (2) (a), a discretionary decision is patently unreasonable if the discretion
(a) is exercised arbitrarily or in bad faith,
(b) is exercised for an improper purpose,
(c) is based entirely or predominantly on irrelevant factors, or
(d) fails to take statutory requirements into account.
[83] Issues do, however, arise concerning the availability of judicial review and the
application of the provisions of s. 58 to the three levels of administrative decision
making involved in this proceeding. I will deal with each level in turn.
1. Reviewability of the Director’s Determination and the Director’s Recalculation Determination
[84] In its petition, in addition to review of the Tribunal Decision and the
Reconsideration Decision, Gulf Coast initially sought judicial review of both the
Director’s Determination and the Director’s Recalculation Determination.
[85] In argument on behalf of Gulf Coast, Mr. Lunny abandoned pursuit of direct
review of the Director’s Determination and the Director’s Recalculation
Determination.
[86] Abandonment of direct judicial review of the Director’s Determination and the
Director’s Recalculation Determination by Gulf Coast was not gratuitous. It was
mandated by application of s. 110(1) of the Employment Standards Act, which
provides:
110 (1) The tribunal has exclusive jurisdiction to inquire into, hear and determine all those matters and questions of fact, law and discretion arising or required to be determined in an appeal or reconsideration under Parts 12 and 13 and to make any order permitted to be made.
[87] Notwithstanding the abandonment of direct judicial review of the Director’s
Determination and the Director’s Recalculation, Mr. Lunny did, however, continue to
indirectly attack both in his submissions concerning the alleged patent
unreasonableness of the Tribunal Decision and the Reconsideration Decision.
[88] Later in these reasons I will consider the extent to which, if at all, the validity of
the Director’s Determination and the Director’s Recalculation Determination may be
impacted by the alleged patent unreasonableness of the Tribunal Decision and the
Reconsideration Decision.
2. Reviewability of the Tribunal Decision: s. 57 of the Administrative Tribunals Act
[89] Mr. Helgesen submitted that the Tribunal Decision is not reviewable by reason
of application of s. 57(1) of the Administrative Tribunals Act and Gulf Coast’s failure
to seek judicial review of the Tribunal Decision within 60 days of its delivery on
July 20, 2009.
[90] Section 57(1) of the Administrative Tribunals Act provides:
57 (1) Unless this Act or the tribunal's enabling Act provides otherwise, an application for judicial review of a final decision of the tribunal must be commenced within 60 days of the date the decision is issued.
[91] Section 57(1) does not, however, create an absolute bar to consideration of
an application for judicial review of a decision filed outside of that 60-day period.
[92] That is so because s. 57(2) provides:
(2) Despite subsection (1), either before or after expiration of the time, the court may extend the time for making the application on terms the court considers proper, if it is satisfied that there are serious grounds for relief, there is a reasonable explanation for the delay and no substantial prejudice or hardship will result to a person affected by the delay.
[93] Mr. Helgesen relied on the decision of Bruce J. in Vause v. Spectra Energy
Midstream Corporation, 2009 BCSC 916, 98 L.C.R. 39 [Vause], in submitting that I
should not extend the time for the judicial review of the Tribunal Decision under
s. 57(2) of the Administrative Tribunals Act.
[94] In his initial submissions on this issue, counsel for Mr. Helgesen referred me
to paras. 54 through 57 of Vause, which considered whether an application for
reconsideration of a final decision of an administrative board revived an otherwise
expired limitation period concerning that decision.
[95] In that portion of her judgment, Bruce J. wrote:
[54] Accordingly, it is the date the original decision is issued that triggers the statutory limitation period for judicial review rather than an application for an internal review or reconsideration of that decision. While a review decision may be the subject of a judicial review proceeding, I agree with Spectra's submission that neither the issuance of such a decision, nor the filing of an application for reconsideration, resurrects the time limits applicable to the original order of the Board.
[55] It was not the intention of the Legislature to create a never ending opportunity for judicial review of administrative decisions. By restricting the time limit to 60 days, s. 57 clearly directs the court to ensure litigants proceed promptly with their judicial review applications. As Huddart J.A. says in Speckling at para. 16:
The rationale for requiring timely applications for judicial review rests on the need to balance the justice of an individual applicant's complaint about an exercise of statutory power of decision with the need to preserve the integrity of the administrative scheme, make efficient use of judicial resources, avoid a multiplicity of proceedings, and avoid prejudice to any other person.
[56] Bearing in mind the distinguishing characteristics of legislation from other provinces, I agree with the Alberta authorities that an internal right of appeal without time limits cannot frustrate a statutory limitation period for judicial review proceedings. If I were to accept the petitioners' argument that any reconsideration decision, regardless of what it decided, resurrects the statutory limitation period applicable to the original decision, it would mean that merely by filing an application for reconsideration under the Petroleum and Natural Gas Act a litigant could revive a limitation period in respect of a decision issued years earlier. As observed by Veit J. in Johannesson at para. 35:
The whole underlying rationale for a limitation period would be undermined if, 10 years after a decision had been issued, a person who was dissatisfied with a tribunal's decision could merely ask the tribunal to reconsider its decision. The mere
making of a request for reconsideration would guarantee judicial review: whether the Board refused to reconsider its decision, or even declined to answer the request for reconsideration, it would have made a decision. Thus, there would never be a conclusion to litigation – there would be the prospect of never ending judicial reviews of decisions not to reconsider a decision.
[57] The petitioners were at liberty to file review applications internally pursuant to s. 26(2) of the Petroleum and Natural Gas Act and presumably there is no time restriction attached to this process. The time limits for judicial review, however, begin to run from the date the original decision is issued. If the Board refuses reconsideration or issues an amended decision, the time limits in s. 57 of the Act only commence to run again in respect of the reconsideration issued by the Board. The reconsideration does not revive the s. 57 time limits in respect of the original decision.
[96] That submission resulted in a formal application by Gulf Coast under s. 57(2)
of the Administrative Tribunals Act to extend the time for its application for judicial
review of the Tribunal Decision to the date of the filing of this petition on January 25,
2010.
[97] That application was opposed by Mr. Helgesen.
[98] In its application to extend time under s. 57(2) of the Administrative Tribunals
Act, Gulf Coast relied upon the distinction that in Vause, Bruce J. was considering
an application for judicial review which had not only been brought well after the
expiration of 60 days from the hearing of the original decision, but also well after
60 days had passed from the issuance of the reconsideration decision of the
administrative board in issue. She also did so in a situation where there was not only
little chance of the review succeeding but also no reasonable explanation for the
delay.
[99] In this case, although no judicial review application was filed concerning the
Tribunal Decision, Gulf Coast did file a Request for the Reconsideration of the
Tribunal Decision within the prescribed time limits under the provisions of s. 116 of
the Employment Standards Act.
[100] In his submissions, Mr. Lunny also referred me to paras. 58 and 59 of Vause,
following immediately after those referred to me and relied upon by
Mr. Cooperwilliams on behalf of Mr. Helgesen.
[101] In those following paragraphs, Bruce J. stated:
[58] This interpretation of s. 57 does not conflict with the common law principle that a litigant should generally be required to exhaust their internal remedies first before applying to the court for judicial review. This principle, as described in Emery, is to prevent premature applications in situations where the tribunal may change its mind and to ensure a tribunal's hearing process is not delayed by repetitive judicial review applications in respect of interim rulings or decisions.
[59] The petitioners were thus under an obligation to file their application for judicial review to preserve the time limits and ask the court to adjourn the proceeding until the Board had completed the review process. This procedure would not interfere with parallel proceedings before the Board involving a reconsideration of the original decision.
While the time limit in s. 57 may not be resurrected by a review decision, clearly a litigant’s decision to await a review decision before seeking judicial review would constitute a reasonable explanation for the delay.
[My emphasis]
Alternatively, the petitioners could have filed their application for judicial review after the review decision was issued and relied on the court's discretion in s. 57(2) based on a reasonable explanation for the delay.
[102] I am satisfied that in the circumstances of this case, I should exercise my
discretion under s. 57(2) of the Administrative Tribunals Act by extending the time for
Gulf Coast’s application for judicial review of the Tribunal Decision to the date of its
filing of this petition on January 25, 2010.
[103] In doing so, I find that Gulf Coast has advanced serious grounds upon which
to seek relief – the fact that the hearing of this petition occupied six days speaks to
that. I also find that no substantial hardship will result to Mr. Helgesen as a
consequence of that delay, given his participation in both this process throughout
while Gulf Coast exhausted its administrative remedies with respect to the impugned
Tribunal Decision.
[104] Bruce J.’s observations at paras. 58 and 59 in Vause are also apposite. I find
that Gulf Coast’s waiting upon the determination of its Reconsideration Application,
before seeking judicial review, constitutes a reasonable explanation for delay.
[105] In reaching that conclusion, I do not accept Mr. Cooperwilliams’ submission
that to establish entitlement to relief under s. 57(2) of the Administrative Tribunals
Act, Gulf Coast was required to file an affidavit affirming that it determined to await
review of the Tribunal Decision by way of reconsideration before seeking judicial
review. Such a requirement would only confirm the obvious. I find that such evidence
is not necessary for me to exercise my discretion to extend time in this case.
[106] The standard of review that will apply to the judicial review of the Tribunal
Decision is governed by the provisions of s. 58(2) of the Administrative Tribunals
Act.
[107] In short, a finding of fact or law must not be interfered with unless it is patently
unreasonable. Questions about the application of common law rules of natural
justice and procedural fairness must be decided on the basis of whether the Tribunal
acted fairly in all of the circumstances. Issues concerning an exercise of discretion
must not be interfered with unless that exercise of discretion is patently
unreasonable under the provisions of s. 58(3) of the Administrative Tribunals Act.
3. The Standard of Review applicable to the Reconsideration Decision
[108] Gulf Coast’s Request for Reconsideration of the Tribunal Decision was
brought pursuant to s. 116 of the Employment Standards Act, which provides:
Reconsideration of orders and decisions
116 (1) On application under subsection (2) or on its own motion, the tribunal may
(a) reconsider any order or decision of the tribunal, and
(b) confirm, vary or cancel the order or decision or refer the matter back to the original panel or another panel.
(2) The director or a person named in a decision or order of the tribunal may make an application under this section.
(3) An application may be made only once with respect to the same order or decision.
[109] On behalf of Mr. Helgesen, Mr. Cooperwilliams submits that the plain wording
of s. 116, and more specifically the use of the permissive “may,” establishes that the
determination of whether to reconsider a decision of the Tribunal involves an
exercise of discretion within the exclusive jurisdiction of the Tribunal.
[110] He further submits that when read in conjunction with s. 58 of the
Administrative Tribunals Act, s. 116 of the Employment Standards Act requires that
since it is a discretionary decision, the Reconsideration Decision must not be
interfered with unless the exercise of the discretion not to reconsider the Tribunal
Decision was patently unreasonable as determined in accordance with the
provisions of s. 58(3) of the Administrative Tribunals Act. Mr. Cooperwilliams
accordingly submits that the Reconsideration Decision can only be set aside if Gulf
Coast establishes that in refusing to reconsider the Tribunal Decision, the
Reconsideration Tribunal exercised its discretion arbitrarily or in bad faith or for an
improper purpose; based the decision entirely on, or predominantly on irrelevant
factors; or, failed to take statutory requirements into account.
[111] On behalf of Gulf Coast, Mr. Lunny submits that not all aspects of the
Reconsideration Decision are discretionary so as to require application of the
statutory definitions of patent unreasonableness established by s. 58(3) of the
Administrative Tribunals Act. He submits that issues concerning whether to hold an
oral hearing, whether to consider new evidence and alleged inadequacy of reasons
engage issues of procedural fairness and natural justice requiring review under
s. 58(2)(b) by reference to common law principles of fairness. See: Karbalaeiali v.
British Columbia (Deputy Solicitor General), 2006 BCSC 1798, aff’d 2007 BCCA 553
at para. 19.
[112] Mr. Lunny also submits that the provisions of s. 58(3) of the Administrative
Tribunals Act concerning what is required to constitute patent unreasonableness in
respect of discretionary decisions may not be exhaustive, and that common law
considerations of patent unreasonableness may also apply. See: Albert v. British
Columbia (Workers’ Compensation Appeal Tribunal), 2006 BCSC 838 at para. 44.
[113] I am satisfied that there is some merit to both the submissions of counsel for
Mr. Helgesen and counsel for Gulf Coast on these issues.
[114] I agree that s. 58(3) of the Administrative Tribunals Act generally governs the
standard of review that must be applied when what is at issue is the exercise of
discretion as to whether to reconsider the Tribunal Decision. I need not decide
whether those criteria are exhaustive, since Mr. Lunny did not refer me to any
specific action or inaction by the Reconsideration Tribunal that would engage
common law considerations of patent unreasonableness concerning an exercise of
discretion that would not be covered by s. 58(3).
[115] I do, however, agree with Mr. Lunny’s submissions that not all aspects of the
Reconsideration Decision and the refusal to reconsider the Tribunal Decision are
necessarily discretionary in nature. To the extent that the reconsideration process
itself may engage issues of procedural fairness or natural justice, I find that the
standard of review to be applied in relation to those issues is the common law
fairness standard required by s. 58(2)(b) of the Administrative Tribunals Act.
(B) Alleged breaches of natural justice and procedural unfairness
[116] As I apprehend Gulf Coast’s submissions concerning alleged breaches of
natural justice and procedural unfairness (aside from allegations of inadequate
investigation which I will address separately), they are that:
1) The Tribunal breached the rules of natural justice and procedural fairness
by:
a) failing to hold an oral hearing into the Complaint; and
b) relying on submissions from individuals not party to the Complaint in
reaching the Tribunal Decision.
2) The Reconsideration Tribunal breached the rules of natural justice and
procedural fairness by:
a) refusing to reconsider the Tribunal Decision in light of Gulf Coast’s
allegations that Mr. Helgesen had abused the process of the Director
under the Employment Standards Act to obtain relief to which he was
not entitled because he had been hired and paid by Mhinder Mayer;
b) failing to provide reasons or, alternatively, adequate reasons, as to why
it accepted the findings of law and fact of the Tribunal and/or the
Director’s Delegate;
c) failing to hold an oral hearing; and
d) refusing to consider new evidence put forward by Gulf Coast.
[117] I will deal with each of those allegations in turn.
1. The Tribunal’s failure to hold an oral hearing
[118] Gulf Coast’s submissions concerning the Tribunal’s alleged breach of natural
justice in failing to hold an oral hearing must be dismissed because no oral hearing
before the Tribunal was sought by it.
[119] Although Gulf Coast did seek an oral hearing by the Reconsideration
Tribunal, it did not raise the failure of the Tribunal to conduct an oral hearing as
either an alleged reviewable error or breach of natural justice. It may not now do so
on this application. See: Johnson v. British Columbia (Workers’ Compensation
Board), 2008 BCCA 232, 81 B.C.L.R. (4th) 380 [Johnson] at para. 11.
2. The Tribunal’s reliance on submissions from individuals not party to the complaint
[120] Gulf Coast’s submissions concerning the Tribunal having breached rules of
natural justice by relying on submissions from individuals who were not party to the
Complaint must also fail. Although Ms. Allison, who acted for Gulf Coast in the
appeal from the Director’s Determination, did raise issues about Mr. Gregory making
submissions on the appeal without identifying on whose behalf he did so, she did not
object to Mhinder Mayer making submissions on his own behalf. Also, neither
Ms. Allison, who filed the Reconsideration Application on behalf of Bhora Mayer and
Gulf Coast, nor Mr. Lunny, who represented Gulf Coast after his appointment as
counsel for Gulf Coast, took specific issue before the Reconsideration Tribunal with
the Tribunal having received or considered submissions from Mr. Gregory or
Mhinder Mayer, as Gulf Coast now does.
[121] It is, in any event, obvious to me from a review of the correspondence from
Mr. Helgesen, Mhinder Mayer and Mr. Gregory to the Delegate, to the Tribunal, and
to the Reconsideration Tribunal, that all three were advancing the same positions in
support of the Complaint. Gulf Coast had ample opportunity to reply to all of those
submissions. In those circumstances, any procedural irregularity that might be said
to have occurred was not, in the totality of the circumstances, so unfair to Gulf Coast
that the Tribunal Decision should be set aside.
3. The Reconsideration Tribunal’s refusal to reconsider the Tribunal Decision because of alleged abuse of process
[122] Gulf Coast asserts that the refusal of the Reconsideration Tribunal to
reconsider the Tribunal Decision in light of its allegations that Mr. Helgesen had
abused the processes available under the Employment Standards Act constituted a
breach of natural justice requiring that the Reconsideration Decision be set aside.
[123] I do not agree with that assertion for the following reasons:
1) Gulf Coast’s allegations of breach of natural justice and procedural
unfairness are, in substance, a recasting of arguments concerning the
merits of the Complaint in the guise of procedural unfairness arguments.
2) Since Gulf Coast did not advance those natural justice allegations or
arguments in its submissions to the Tribunal, it may not now do so.
3) Although Mr. Lunny did, in his reply submissions to the Reconsideration
Tribunal, question the bona fides of the Complaint by reference to the loan
from Kelly Mayer to Mr. Helgesen (which he said gave rise to an issue of
procedural fairness) he did so only in the context of alleged inadequate
investigation by the Delegate and in support of the submission that the
Tribunal Decision should be reconsidered.
4) The fact that the Reconsideration Tribunal did not accept that submission
as a basis upon which to grant reconsideration does not constitute a
breach of natural justice or procedural unfairness by the Reconsideration
Tribunal. At best, it is a factor to be considered in determining whether,
having regard to the provisions of ss. 58(2)(a) and 58(3) of the
Administrative Tribunals Act, the Reconsideration Tribunal’s refusal to
allow reconsideration of the Tribunal Decision was patently unreasonable.
4. The Reconsideration Tribunal’s alleged failure to provide adequate reasons
[124] Gulf Coast has submitted that the failure of the Reconsideration Tribunal to
provide reasons or, alternatively, adequate reasons, as to why it accepted the
Delegate’s and/or the Tribunal’s findings of law and fact constitute a breach of
natural justice or procedural unfairness.
[125] I am not satisfied that Gulf Coast has established that any inadequacy of the
reasons provided by the Reconsideration Tribunal denies or precludes meaningful
review.
[126] I do agree that the Reconsideration Tribunal’s reasoning in the
Reconsideration Decision is in some respects both lacking in analysis and
conclusory. However, when read in conjunction with the Director’s Determination,
the Tribunal Decision, and the submissions of counsel on the Reconsideration
Application, the basis of the decision making can be ascertained.
[127] For example, while on its face the statement (of which Gulf Coast complains)
in the Reconsideration Decision at the end of paragraph 37 that “the finding of the
Director is one of fact that is not ‘clearly in error’” appears devoid of analysis, when
considered in the context of the balance of that paragraph, as well as the Director’s
Determination, it is capable of review. Also, the statement at paragraph 39 of the
Reconsideration Decision (referring to Gulf Coast’s articles of association which it
sought to have admitted as new evidence) that “I do not find this information to be
either significant or probative of the issues raised in this application” is capable of
analysis on review when it is read in conjunction with Mr. Lunny’s submissions to the
Reconsideration Tribunal.
5. The Reconsideration Tribunal’s refusal to hold an oral hearing
[128] I find that Gulf Coast has not established that the Reconsideration Decision
should be set aside because of the Reconsideration Tribunal’s refusal to hold an oral
hearing.
[129] I reach that conclusion whether (as submitted by Gulf Coast), a “fairness”
standard under s. 58(2)(b) of the Administrative Tribunals Act as an alleged breach
of natural justice should be applied; or (as submitted by Mr. Helgesen), the higher
“patently unreasonable standard” under s. 58(2)(a) is applicable.
[130] My reasons for that conclusion follow:
1) Rule 17(1) of the Tribunal’s “Rules of Practice and Procedure” provides
that for the hearing of an appeal or on an application for reconsideration,
the Tribunal may choose the type of hearing it considers appropriate to the
circumstances. However, Rule 17(2) also provides that usually an appeal
hearing will proceed as a “written submission hearing.”
2) In its own jurisprudence, the Tribunal has held that it will not hold an oral
hearing unless it is apparent either that the case involves a serious issue
of credibility on one or more key issues, or it is clear on the face of the
record that an oral hearing is the only way of ensuring each party can
state its case fairly.
3) In D. Hall & Associates Ltd. v. British Columbia (Director of Employment
Standards), 2001 BCSC 575, [2001] B.C.T.C. 575 at paras. 28 to 30,
Ross J. considered that approach, and observed that:
[28] Considering the factors which are said to inform the content of the duty of fairness, I cannot conclude that the failure to hold an oral hearing amounted to a denial of a fair hearing on the present case.
[29] An important purpose of the Employment Standards Act, as set out in section 2 (d) of the Act, is "to provide fair and efficient procedures for resolving disputes over the application and interpretation of this Act." In commenting upon employment standard provisions from another jurisdiction, in Sobeys Stores Ltd. v. Yeoman, [1989] 1 S.C.R. 238, Madam Justice Wilson made the following observation with respect to the importance of efficient proceedings:
Along with its substantive protections the Code provides workers with a number of procedural protections. The provisions which assure an employee of confidentiality with respect to his or her complaint recognizes the practical problems that may beset an employee who wants to complain about his or her employer. More importantly, the Code provides a cheap and speedy mechanism whereby complaints can be investigated and resolved. This is at least as important as the substantive protections offered. These procedures are in the Code in part because the courts have historically proved too slow and expensive a mechanism for dealing with the relatively small amounts of money that would be claimed in lost wages or wages in lieu of notice by unskilled or semi-skilled workers. The importance of such speedy administrative procedures was recognized in the context of a s. 96 challenge by the Manitoba Court of Appeal in Re Mitchell and Employment Standards Division, Department of Labour (1977), 82 D.L.R. (3d) 339, [1978] 1 W.W.R. 237, and in Re Central Canadian Structures Ltd. and Director, Employment Standards Division (1984), 8 D.L.R. (4th) 514, [1984] 4 W.W.R. 182, 26 Man. R. (2d) 297. Sobey's
Stores Ltd. v Yeomans (1989) 57 DLR (4th) 1 at p. 31-32.
[30] The Tribunal's own choice of procedures are not such as to create a legitimate expectation that an oral hearing will be held in every case including disputed facts, only that such a hearing may be held. This is reflected in the Tribunal's decisions in Re Ladd's Important Motor Car Co. (9 December 1996), BC EST #D313/96, Re R.& K Logging (15 October 1997), BC EST #D471/97, and Pacific Ice Co., supra.
4) Mr. Cooperwilliams submitted on behalf of Mr. Helgesen that the
Reconsideration Application did not involve a serious issue of credibility on
one or more key issues. I agree.
5) Although Ms. Allison, as counsel for Bhora Mayer and Gulf Coast, did
request an oral hearing of the Reconsideration Application, she also
stated (at paragraph 7) that “the key facts are not in dispute.” Further (at
paragraph 28), Ms. Allison said, “The key focus of the application is not to
re-weigh the evidence tendered, since the evidence is not in dispute but to
address the legal obligations that arise from the conduct of the parties.”
6) In his reply submissions on behalf of Gulf Coast seeking an oral hearing,
Mr. Lunny raised issues concerning the failure of the Delegate to interview
Bhora Mayer as a matter of denial of natural justice requiring an oral
hearing. I agree that the failure to interview Bhora Mayer, especially when
considered in light of the Tribunal’s erroneous finding that he had been
interviewed, was a factor that the Reconsideration Tribunal was obliged to
consider in determining whether to reconsider the Tribunal Decision. I do
not, however, agree that any failure to interview Bhora Mayer required an
oral hearing of the Reconsideration Application to prevent unfairness.
7) In his reply submissions on behalf of Gulf Coast, Mr. Lunny also submitted
that only through cross-examination of Mr. Helgesen, Mhinder Mayer and
Kelly Mayer concerning the “loan” arrangement by which Mr. Helgesen
continued to be paid for his work, could the Reconsideration Tribunal
assess the bona fides of the Complaint. While I agree that a more
thorough investigation into the circumstances of that arrangement than
was conducted should have been carried out by the Delegate, I also
observe that counsel for Bhora Mayer and Gulf Coast did not raise that as
an issue for consideration by the Tribunal. In those circumstances, I do not
find that the refusal of the Reconsideration Tribunal to grant an oral
hearing resulted in the denial of a fair hearing of the Reconsideration
Application.
8) There was also nothing on the face of the record before the
Reconsideration Tribunal to indicate that an oral hearing was the only way
by which Gulf Coast could state its case. Ms. Allison, as counsel for Bhora
Mayer and Gulf Coast, filed fully-articulated initial submissions in support
of the Reconsideration Application, and Mr. Lunny, on behalf of Gulf
Coast, filed comprehensive reply submissions which dealt fully with all
matters in issue.
6. The Reconsideration Tribunal’s refusal to consider new evidence
[131] I have concluded that the Reconsideration Tribunal’s refusal to consider the
new evidence put forward by Gulf Coast does not amount to a breach of natural
justice that should be considered on a “fairness” standard under s. 58(2)(b) of the
Administrative Tribunals Act.
[132] Although the refusal to admit new evidence (and most particularly the order
and reasons for judgment of Burnyeat J.) which Gulf Coast sought to have admitted,
does raise substantive and procedural issues that must be examined in some detail,
I have determined that the issue must be considered and reviewed, not as an issue
of natural justice, but rather as an exercise of discretion under ss. 58(2)(a) and 58(3)
of the Administrative Tribunals Act.
[133] I will accordingly do so later in these reasons when considering Gulf Coast’s
arguments that the Reconsideration Tribunal erred in fact and law in failing to admit
the new evidence, and also erred in law in applying its threshold policy for
determining whether to allow the Reconsideration Application “in a manner that
resulted in the endorsement of decisions that were perverse.”
7. Allegations of inadequate investigation
[134] In addition to those alleged breaches of natural justice and procedural
fairness by the Tribunal and the Reconsideration Tribunal that I have already
considered and dismissed, Gulf Coast also submitted that the investigation which
gave rise to the Tribunal Decision and the Reconsideration Decision was so flawed
and in breach of both natural justice and procedural fairness that both decisions
must be set aside.
[135] The primary difficulty with Gulf Coast’s submissions based upon these
allegations is that they were never raised by Gulf Coast before the Tribunal as
issues of natural justice or procedural fairness, and were only addressed before the
Reconsideration Tribunal in reply submissions by Mr. Lunny on behalf of Gulf Coast,
after the order of Burnyeat J. authorized Mr. Lunny’s appointment as counsel for
Gulf Coast.
[136] I am satisfied that, in large part, Gulf Coast’s present submissions of
inadequate investigation are brought with the benefit of hindsight arising from the
present knowledge that the concept of a “corporate deadlock” having put
Mr. Helgesen in the middle of a dispute between Mhinder Mayer and Bhora Mayer,
that could not be resolved except by agreement, is factually and legally incorrect.
[137] Armed with that present knowledge, Gulf Coast now seeks to revisit the whole
of the investigation by the Director that culminated in the Director’s Determination,
and the decision-making process of the Tribunal that gave rise to the Tribunal
Decision.
[138] Although couched in terms of the Tribunal having failed to correct an
inadequate investigation, I find that in substance the present submissions of Gulf
Coast call directly into question findings of fact and law and the exercise of
discretion by the Director, which by reason of s. 110(1) of the Employment
Standards Act cannot be the subject of judicial review.
[139] In my opinion, the only issue of inadequate investigation raised by Gulf Coast
that is not coloured by issues of hindsight relates to the submission that the
Delegate did not sufficiently inquire into the “loan arrangements” between
Mr. Helgesen and Mrs. Mayer in determining whether those arrangements were
payment by D & A Crushing Ltd. for work done by Mr. Helgesen at its direction
through Mhinder Mayer.
[140] It must be noted, however, that while those circumstances were raised as a
concern by Gulf Coast during the Delegate’s conduct of his investigation of the
Complaint, they were not pursued as an issue before the Tribunal. Rather, on that
appeal, Gulf Coast submitted that:
41. Further, given the evidence that M. Mayer and his wife have been paying Helgesen themselves, this indicates that they are his employer, not Gulf. In our submissions, an employer is someone who has control or direction of an employee, which would be M. Mayer. And as per the definitions, an employee includes a person receiving or entitled to wages for work performed for another. In this case, Helgesen was performing work for M. Mayer.
42. Therefore, under the first issue, it is submitted that there is no dispute that Helgesen is an "employee" as defined in the Act, but he is not an employee of Gulf.
[141] For all of the foregoing reasons, I have concluded that Gulf Coast has not
established that either the Tribunal Decision or the Reconsideration Decision should
be set aside by reason of any alleged breaches of natural justice or procedural
unfairness or by reason of alleged inadequate investigation into the circumstances of
the Complaint that were known and shaped by the positions advanced by the
interested parties, including Gulf Coast, when the investigation was being
conducted.
(C) Alleged errors of fact, law, or mixed law and fact made by the Director and allegedly perpetuated in the Tribunal Decision and the Reconsideration Decision unrelated to alleged breaches of natural justice
[142] In its Petition, Gulf Coast alleges nine distinct “errors of law” or “errors of
mixed fact and law” made by the Tribunal that are not related to its allegations of
breaches of natural justice, inadequate investigation or procedural unfairness.
[143] Gulf Coast also alleges seven such distinct “errors of law” or “errors of mixed
fact and law” made by the Reconsideration Tribunal.
[144] All of those alleged errors must first be assessed in light of the facts that:
1) Gulf Coast alleged only two grounds of alleged errors in its appeal of the
Director’s Determination to the Tribunal, those grounds being that:
(a) The Director erred in law by applying the “indoor management rule” to determining whether Helgesen was employed by Gulf;
(b) The Director erred in law by misapplying the test of whether Helgesen was an employee.
2) Gulf Coast also opposed Mr. Helgesen’s appeal of the Director’s
Determination concerning the proper interpretation of s. 80 of the
Employment Standards Act.
3) Gulf Coast alleged only four grounds of alleged errors in its application for
reconsideration of the Tribunal Decision by the Reconsideration Tribunal,
those grounds being that:
(a) the Tribunal erred in law in finding [that] Gulf was Mr. Helgesen’s employer;
(b) the Tribunal erred in law in finding that Mr. [Helgesen] was an employee of Gulf;
(c) the Tribunal erred in finding that Gulf owed wages to Mr. Helgesen;
(d) the Tribunal erred in law by awarding damages for the period from the date of the complaint to the date of the determination.
[145] As I noted earlier when considering Gulf Coast’s allegations that the Tribunal
had breached natural justice and procedural fairness by failing to hold an oral
hearing, Gulf Coast may not now, by way of judicial review, pursue grounds not
raised before the Tribunal or the Reconsideration Tribunal.
[146] In Johnson, at para. 11, Low J.A. stated:
[11] With respect, I think the judge erred by finding error in the decision of the Appeal Tribunal on an issue that the tribunal was not called upon to consider and did not consider. It is fundamental to judicial review of decisions or orders of tribunals that reviews be confined to those matters that were determined by the tribunal.
[My emphasis]
What the judge did here was decide in the first instance the issue of the legality of the new interest policy on application of the patently unreasonable test as though that issue ought to have been decided by the tribunal.
[147] I find that the only alleged errors by the Tribunal that may now be pursued on
this petition are those that were relied upon by Gulf Coast in its appeal of the
Director’s Determination, or that are so directly related to those grounds that I am
satisfied they were considered and determined by the Tribunal.
[148] In result, I will only consider the following enumerated “Grounds” in the
petition alleging errors by the Tribunal that were also advanced before the Tribunal,
either in appealing the Director’s Determination or in answering Mr. Helgesen’s
appeal:
1) Ground 33: “The Tribunal erred in law by determining that the doctrine of
“apparent authority” and/or the “indoor management rule” applied in the
circumstances of this case and the related grounds that the Tribunal erred
by:
a) “finding that Helgesen had been ‘caught in the middle’ of a dispute
between Bhora Mayer and Mhinder [Mayer]” (Ground 27);
b) “finding that Helgesen did not receive wages because Gulf Coast’s
payroll was administered by Bastion Management Ltd.” (Ground 29);
and
c) “holding that there was a deadlock between Bhora Mayer and Mhinder
Mayer” (Ground 31).
2) Ground 25: “The Tribunal erred in law in the interpretation of s. 80 of the
[Employment Standards] Act and in particular in the interpretation of the
six-month recovery interval.”
[149] I will also consider the allegation in Ground 30 of the petition that “the Tribunal
erred in fact and in law in finding that Bhora Mayer had been interviewed during the
course of the investigation.” That was not an issue that could have been raised as a
ground of appeal of the Director’s Determination because it only arose as a
consequence of a determination made by the Tribunal during the conduct of that
appeal.
[150] Also, although some of the errors alleged to have been made by the
Reconsideration Tribunal are somewhat repetitive, I will consider each of the seven
alleged Grounds of error alleged by Gulf Coast. I will do so for the following reasons:
1) Ground 35 which alleges that the Reconsideration Tribunal “erred in law
by ignoring relevant facts” only arose from the findings of the
Reconsideration Tribunal, and is accordingly properly subject to judicial
review.
2) Ground 36 which alleges that the Reconsideration Tribunal “erred in fact
and in law in failing to accept and consider the new evidence submitted by
Gulf Coast” only arose during the conduct of the Reconsideration
Application, and is accordingly properly subject to judicial review.
3) Ground 47 which alleges that the Reconsideration Tribunal “erred in mis-
stating Gulf Coast’s position regarding the interpretation of s. 80 of the
Employment Standards Act in a manner which indicates a bias or a
reasonable apprehension of bias, against Gulf Coast” is sufficiently related
to the grounds of error advanced by Gulf Coast in the Reconsideration
Application, to properly be subject to judicial review.
4) Ground 48 which alleges that the Reconsideration Tribunal “erred in law
and in fact when it determined that Bhora Mayer was ‘well aware of the
nature of the claim’ when there is no evidence that Bhora Mayer knew
what statements had been made to the delegate” arose only from the
findings of the Reconsideration Tribunal, and is accordingly properly
subject to judicial review.
5) Ground 49 which alleges six specific errors made by the Reconsideration
Tribunal in refusing to allow reconsideration of the Tribunal’s alleged
errors in finding that Mr. Helgesen was an employee of Gulf Coast and
was owed wages by Gulf Coast. All of the errors alleged either emanated
from the allegations of error by the Tribunal that were advanced by Gulf
Coast or were otherwise considered and determined by the
Reconsideration Tribunal, and are accordingly properly the subject of
judicial review.
6) Ground 50 which alleges that the Reconsideration Tribunal “erred in law in
applying its threshold policy [to reconsideration] in a manner that resulted
in the endorsement of decisions that were perverse” only arose from the
conduct of the Reconsideration Application, and is accordingly properly
subject to judicial review.
7) Ground 52 which alleges that the Reconsideration Tribunal “erred in law in
failing to rectify or prevent an injustice or wrong to any party in the
previous proceedings” only arose from the conduct of the Reconsideration
Application, and is accordingly properly subject to judicial review.
[151] In considering those alleged errors of law or errors of mixed law and fact by
the Tribunal or the Reconsideration Tribunal advanced by Gulf Coast that I consider
to be properly subject to judicial review, I will proceed as follows:
1) In this part of my reasons for judgment I will address those Grounds which
I will collectively refer to as alleged errors concerning “corporate
governance,” and other alleged errors in the Director’s Determination and
the Tribunal Decision which have resulted in findings that Mr. Helgesen is
an employee of Gulf Coast, and is owed wages by it.
2) In the following part I will address the alleged errors of the
Reconsideration Tribunal in refusing to admit new evidence and
reconsider the Tribunal Decision.
3) In the last part I will address the alleged errors of the Tribunal and the
Reconsideration Tribunal in the interpretation of s. 80 of the Employment
Standards Act.
[152] Before considering any of those alleged errors, however, I pause to reiterate
that I will do so, bearing in mind that:
1) I have found no breaches of natural justice or procedural fairness requiring
or warranting interference with any of the decisions under consideration.
2) The Tribunal has exclusive jurisdiction to inquire into, hear and determine
questions of findings of fact and law and exercise of discretion by the
Director.
3) The standard of review to be applied to the consideration of errors
allegedly made by the Tribunal or the Reconsideration Tribunal requires
that a finding of fact or law or an exercise of discretion by the Tribunal or
the Reconsideration Tribunal must not be interfered with unless it is
patently unreasonable.
(D) Alleged errors concerning “corporate governance” and other alleged errors in the Director’s Determination and the Tribunal Decision that have resulted in findings that Mr. Helgesen is an employee of Gulf Coast and is owed wages by it
[153] The Delegate made many findings of fact about Mr. Helgesen’s history with
Gulf Coast and its principals, Bhora Mayer and Mhinder Mayer, which cannot now
be challenged. He also made findings of law relating to those facts, the principal
ones being that Mr. Helgesen was an employee of Gulf Coast who, as his employer,
had failed to pay wages owed to its employee.
[154] While acknowledging that it cannot directly seek to attack those findings of
fact and law, Gulf Coast asserts that by reason of the corporate structure of Gulf
Coast, Bhora Mayer’s refusal to allow the hiring of Mr. Helgesen by Gulf Coast and
Mr. Helgesen’s knowledge of that refusal, the Tribunal’s upholding of the Delegate’s
findings of fact and law is clearly irrational, as is the Reconsideration Tribunal’s
refusal to allow reconsideration of those findings.
[155] As noted above, the errors alleged by Gulf Coast as supporting a finding of
irrationality are identified in Ground 33 and the related Grounds 27, 29 and 31 of the
Petition. In summary, the errors alleged are that the Tribunal erred in law by:
1) Determining that the doctrine of “apparent authority” or the “indoor
management rule” applied;
2) Finding that Mr. Helgesen had been “caught in the middle of a dispute”;
3) Holding that there was a deadlock between Bhora and Mhinder Mayer,
and finding that Mr. Helgesen did not receive wages because Gulf Coast’s
payroll was administered by Bastion Management Ltd.
[156] In Ground 49 of the Petition, Gulf Coast alleges that the Reconsideration
Panel perpetuated and amplified those errors:
… by failing to comprehend the true corporate structure of Gulf Coast and the legal implication of that structure and its effect on the factual and legal
determination of the Delegate and/or the Tribunal. This failure led to the continuation of, and/or additional, errors in law and in fact including:
a) Gulf Coast took no formal steps against Helgesen
b) "Bhora took steps" against Helgesen when in fact Bhora Mayer took those steps as the legal representative of Gulf Coast
c) There was a deadlock between Bhora Mayer and Mhinder Mayer as the Articles indicate that Bhora Mayer had the deciding vote in any disagreement between the shareholders and/or the directors of Gulf Coast
d) The Articles were not probative of the issues raised in the reconsideration application
e) Mhinder Mayer was a senior manager of Gulf Coast
f) Mhinder Mayer had the power to execute decisions on behalf of Gulf Coast
[157] I agree with Gulf Coast’s submissions that the Delegate’s findings in the
Director’s Determination, those of the Tribunal upholding them, and those of the
Reconsideration Decision endorsing them based upon findings of a “corporate
deadlock” over the hiring and continuing employment of Mr. Helgesen by Gulf Coast
are difficult, if not impossible, to rationalize with actual corporate governance
structure of Gulf Coast that vests a deciding or casting vote in Bhora Mayer as its
president that is now known.
[158] That does not, however, necessarily make the finding that Mr. Helgesen was
Gulf Coast’s employee an irrational one.
[159] I say that because not only the Delegate, Mr. Helgesen, Mhinder Mayer, and
Mr. Gregory on behalf of Mhinder Mayer (and apparently also for Mr. Helgesen from
time to time), but also counsel for Bhora Mayer and Gulf Coast assumed that there
was in fact a corporate deadlock.
[160] In Ms. Allison’s submissions to the Tribunal on the appeal of the Director’s
Determination dated May 20, 2009, at paragraphs 17 to 21, she wrote:
17. Gulf and Mr. Mayer submit that as a matter of law, Gulf could not make a contract of employment or permit:
18. According to the Oxford English Dictionary, “permit” means “give consent or opportunity".
there was no consensus within Gulf, no delegated authority and no actual authority.
19.
20. To be found to be an employer, Gulf had to do something: it had to permit Mr. Helgesen to work. Gulf and Mr. Mayer submit that Gulf did not and could not, as a matter of law, permit Mr. Helgesen to do anything.
In the absence of an agreement between the shareholders/directors, Gulf could not give consent or opportunity to Mr. Helgesen.
21. As a matter of law, Mhinder Mayer lacked authority to hire Mr. Helgesen. The Mayers were equal shareholders and both were directors. There was a head-on dispute over whether Mr. Helgesen should be hired.
On the matter of Mr. Helgesen there was a clear disagreement between the shareholders/directors. There was no casting vote. Gulf was therefore paralysed.
Agreement was required among them to act. In the face of such a disagreement, Mhinder Mayer had no authority to act.
[My emphasis]
Further, there is no evidence to support a finding that Mhinder Mayer had the authority to hire Mr. Helgesen, on behalf of Gulf, in the face of an explicit objection by Mr. Mayer.
[161] We now know that to the extent that those submissions were premised upon
a belief by all concerned that there was a corporate deadlock, they perpetuated an
incorrect legal analysis of the facts before the Delegate and the Tribunal.
[162] It can now be fairly said that the present knowledge of the actual corporate
governance situation strengthens Gulf Coast’s submissions that since Mhinder
Mayer could not hire him, Mr. Helgesen could not be its employee.
[163] I am, however, not satisfied that Mhinder Mayer’s lack of corporate hiring
authority vitiates the entirety of the Director’s Determination that Mr. Helgesen was
an employee of Gulf Coast during the period alleged in the Certificate.
[164] There can, I think, be little doubt that the totality of the facts known to the
Delegate are capable of supporting a finding that Mr. Helgesen was an employee of
some employer
[165] While there can now be little doubt that Mhinder Mayer had no corporate
authority to hire Mr. Helgesen on behalf of Gulf Coast, there remains the fact of the
at Gulf Coast’s Salt Spring Island plant during the currency of the
Certificate. The only real issue of dispute was, and is, whether that employer was
Gulf Coast alone or some combination of Mhinder Mayer, Kelly Mayer and D & A
Crushing alone or possibly together with Gulf Coast.
representations made by him to Mr. Helgesen that he had such authority. There also
remains the fact that Mhinder Mayer told Mr. Helgesen to ignore Bhora Mayer, and
directed Mr. Helgesen’s work at the Gulf Coast plant.
[166] The facts found by the Delegate with which I must not interfere, establish that
Mr. Helgesen relied on those representations and directions of Mhinder Mayer.
[167] It may be that Mhinder Mayer is responsible to Gulf Coast for purporting to
exercise authority he did not have, but that was not an issue that could have been
addressed by the Delegate or the Tribunal, given the positions taken by the parties
during the Delegate’s investigation of the Complaint, and the Tribunal’s hearing of
the appeal of the Director’s Determination.
[168] I find that in all of those circumstances, the facts then known and the positions
advanced by all concerned, that the Director’s finding that Gulf Coast was
Mr. Helgesen’s employer was not irrational.
[169] While that finding might be irrational if examined in the light of the now-known
facts, those were not the facts upon which the impugned decisions were made.
[170] I also find that Ground 35 of the Petition, in which Gulf Coast alleges that the
Reconsideration Tribunal “erred in law by ignoring relevant facts” does not assist
Gulf Coast in its submissions that any of the impugned decisions should be set
aside. I reach that conclusion because Gulf Coast did not identify any specific
relevant facts that it alleges were ignored that could warrant interference with the
Reconsideration Decision.
[171] Gulf Coast’s allegation in Ground 48 of the Petition that the Reconsideration
Tribunal erred in determining that Bhora Mayer was well aware of the nature of the
claim, when there is no evidence that Bhora Mayer knew what statements had been
made to the Delegate, also does not assist Gulf Coast in its submissions that any of
the impugned decisions should be set aside.
[172] I find that in the totality of the circumstances even if Bhora Mayer was
unaware of specific statements made to the Delegate during the investigation of the
Complaint, any such statements had no substantive effect on the Reconsideration
Tribunal’s refusal to reconsider the Tribunal Decision.
[173] In summary, I have concluded that in all of the circumstances there is no
basis upon which I could, or should, set aside the Director’s Determination or the
Tribunal Decision, based upon alleged errors concerning “corporate governance” or
other alleged errors that resulted in findings that Mr. Helgesen was an employee of
Gulf Coast during the time covered by the Certificate and thus owed wages for that
period.
[174] In reaching that conclusion I have, however, not yet addressed issues
concerning Gulf Coast’s allegations of errors made by the Reconsideration Tribunal
concerning corporate governance arising from, or related to the Reconsideration
Tribunal’s refusal to admit new evidence.
[175] I have also limited my conclusions to the period covered by the Certificate,
because any conclusions related to any period of time after December 31, 2008, are
subject to consideration of the interpretation of s. 80(1) of the Employment
Standards Act.
(E) The refusal of the Reconsideration Tribunal to consider new evidence and reconsider the Tribunal Decision
[176] As interpreted and applied by the Tribunal in its decided cases, the
discretionary reconsideration power granted to the Tribunal by s. 116 of the
Employment Standards Act engages a two-stage process. See: Re: Kiss, [1996]
B.C.E.S.T.D. No. 129; BC EST #D122/96; File No. 95/004 [Re: Kiss].
[177] At the first (threshold) stage, the reconsideration panel decides whether the
matters raised by the application warrant reconsideration and whether the applicant
has made out an arguable case of sufficient merit to warrant the reconsideration. If
so, the second stage analysis focuses on the correctness of the decision. See: Re:
AMS Consulting Ltd., [2007] B.C.E.S.T.D. No. 89; BC EST #D089/07; File No.
2007A/85 [Re: AMS].
[178] The reconsideration power is also used with restraint and in exceptional
circumstances. See: Re: AMS.
[179] A non-exhaustive list of reasons which may give rise to the exercise of the
reconsideration panel’s power to reconsider an original Tribunal decision (taken from
Kiss and Re: AMS) includes:
• The member fails to comply with the principles of natural justice;
• There is some mistake in stating the facts;
• The Decision is not consistent with other Decisions based on similar facts;
• Some significant and serious new evidence has become available that would have led the member to a different decision;
• Some serious mistake was made in applying the law;
• Some significant issue in the appeal was misunderstood or overlooked; and
• The Decision contains a serious clerical error.
[180] The Reconsideration Tribunal referred to that list of reasons in determining
that Gulf Coast had not met the threshold test to warrant reconsideration of the
Tribunal Decision. In doing so, the Reconsideration Tribunal also stated:
17. It will weigh against an application if it is determined its primary focus is to have the reconsideration panel effectively re-visit the original decision and come to a different conclusion: see, for example, Joyce Middleton operating as Reflexology and Stress Clinic, BC EST # RD126/06.
18 While the Tribunal has adopted a principled approach about whether to reconsider, there is no formula that dictates the outcome of a reconsideration application. There is room for judgment in applying the relevant factors. As the Tribunal stated in Valorosa, BC EST # RD046/01:
Having devoted significant energy to elucidating the principles governing the Tribunal's discretion under s. 116, we hasten to add that one cannot dictate the outcome of its exercise in advance. A great strength of our legal system — one that is at once frustrating for students of
law and compellingly true for those administering it — is that "it all depends on the circumstances".
19. If the Tribunal decides the matter is one that warrants reconsideration, the Tribunal proceeds to the second stage, which is an analysis of the substantive issue, or issues, raised by the reconsideration.
20. Initially, this application was grounded solely on alleged errors of law by the Director and by the Tribunal Member in the original decision. In his November 6, 2009, reply on behalf of Gulf Coast, Mr. Lunny raised natural justice and procedural fairness arguments relating to the complaint process.
[181] As I have previously noted, in dismissing Gulf Coast’s Reconsideration
Application the Reconsideration Tribunal also refused its application to admit new
evidence.
[182] The new evidence that Gulf Coast, through Mr. Lunny, sought to have
admitted consisted of:
1) documents from the RCMP that Mr. Lunny sought to tender to refute the
finding of the Tribunal that “Bhora Mayer took no formal legal steps to
have Mr. Helgesen barred from the workplace.”
2) the order and reasons for judgment of Burnyeat J. dated July 30, 2009,
authorizing Bhora Mayer on Gulf Coast’s behalf to retain Mr. Lunny in
related litigation by reason of provisions found in the articles of “many of
the companies” (in which Bhora Mayer and Mhinder Mayer were equal
shareholders) that gave Bhora Mayer, as president, a second or casting
vote in the event of a deadlock.
3) excerpts from Gulf Coast’s articles of association to establish that Bhora
Mayer had such a casting vote as president of Gulf Coast.
[183] In refusing to admit any of that evidence, the Reconsideration Tribunal stated:
36. Mr. Lunny supports his submission for an oral hearing and a new evidentiary review, in part, by challenging the factual finding in the Determination that "Bhora Mayer took no formal legal steps to have Mr. Helgesen barred from the workplace". Mr. Lunny alleges this
finding is in error because Bhora Mayer had contacted the RCMP to inquire about having them remove Helgesen from the worksite. He has provided some supporting documents relating to that allegation.
37. There are four obvious problems with this argument, leading to a conclusion there is no merit to it. First, it is raised on behalf of Bhora Mayer. Mr. Lunny is not counsel for Bhora Mayer, but for Gulf Coast. If there is any validity at all to this point, it should be raised by Ms. Allison, who represents Bhora Mayer. It has not. Second, it is raised for the first time in this application in the final response of Gulf Coast, notwithstanding there were several opportunities to provide this information to the Director and the Tribunal, including the opportunity to review and comment on a draft of the Director's findings prior to the issuance of the Determination, the appeal and the initial submission on this application. Third, the actual finding of the Director in the Determination was that "the only action taken [against Helgesen] is a refusal to process the payment of wages". That is a completely accurate statement as it stretches credulity to suggest contacting the RCMP and being immediately told they would not get involved, as "taking formal legal steps". And fourth, the finding of the Director is one of fact that is not "clearly in error".
38. Mr. Lunny also says the Director, and the Tribunal, erred in "placing any reliance upon the fact that the payroll is handled by Bastion Management — a company aligned to Bhora's group of companies". The reference to Bastion Management appears to have been made to explain how it was that Helgesen never received any wages from Gulf Coast and why the loan arrangement between Helgesen and Kelly Mayer was established. The actual comment is found in the Determination in a recitation of the background and evidence provided in the complaint process. There is no indication in the original decision, or indeed in the Determination, that comment was relied on to find Helgesen was an employee of Gulf Coast. Whether Mr. Lunny disagrees with the reference to Bastion Management in the original decision, he has failed to provide a nexus between that reference and the challenged finding on Helgesen's relationship with Gulf Coast.
39. Mr. Lunny has provided excerpts from the Articles of Association of Gulf Coast. In addition to being information that could have been provided earlier in the processes, I do not find this information to be either significant or probative of the issues raised in this application.
40. For the same reason, I do not find the Supreme Court Order to be probative of the issues that are being argued in this application. The Determination was not based on any legal assessment of Mhinder Mayer's actual authority within Gulf Coast, but on the conclusion of the Director that in the circumstances Helgesen was entitled to rely on the direction and instruction of a senior manager and 50% owner of Gulf Coast that he was hired and should continue to work. As the Tribunal Member stated in the original decision:
Clearly, and Bhora Mayer does not challenge this proposition, in the usual course of events
someone in the position of Mhinder Mayer would have the presumptive legal authority to bind the company to an employment contract, (at para. 30)
41. In sum, I reject the suggestion there is significant new evidence that justifies an oral hearing or a re-examination of the findings of fact that were made in the Determination and accepted in the original decision.
42. With those extraneous matters fleshed out of the submissions, this application adds nothing new to the issue of whether Helgesen was an employee of Gulf Coast. All of the other submissions in the application relate in some form to the authority of Mhinder Mayer to hire Helgesen.
[184] I disagree with the Reconsideration Tribunal’s conclusion that neither the
articles of Gulf Coast nor the order and judgment of Burnyeat J. are “significant or
probative of the issues raised in this application.”
[185] In my opinion, those documents create an entirely different legal framework
against which to assess both Mr. Helgesen’s claims and Mhinder Mayer’s actions.
As such, they are at least highly significant and potentially conclusively probative of
a lack of any ability of Mhinder Mayer to bind Gulf Coast, either statutorily or at
common law, to any obligation to pay wages to Mr. Helgesen.
[186] I do not, however, also find that the Reconsideration Tribunal’s exercise of its
discretionary power to refuse to admit that evidence in refusing to admit the new
evidence was patently unreasonable.
[187] Although Burnyeat J.’s decision and reasons were not available to Gulf Coast
during the investigation of the Complaint or the hearing of the appeal by the
Tribunal, the articles of association of Gulf Coast upon which his decision was
based, were available. The Reconsideration Tribunal was entitled to consider that
the articles could have been “provided earlier in the process.” Similarly, Gulf Coast’s
president or lawyers could have (if they had been either sufficiently familiar with the
corporate governance issues now raised or considered them sufficiently important)
sought the same judicial determination eventually made by Burnyeat J. much earlier
in the administrative process.
[188] Accordingly, while I disagree with some of the bases upon which the
Reconsideration Tribunal refused to admit the new evidence of corporate
governance, I am satisfied that I cannot, and should not, interfere with that
discretionary exercise of its jurisdiction.
[189] I do not, however, reach that same conclusion concerning the refusal of the
Reconsideration Tribunal to allow reconsideration of the Tribunal Decision
concerning its interpretation of s. 80(1) of the Employment Standards Act.
[190] In refusing reconsideration on that issue, the Reconsideration Tribunal stated:
50. The original decision on the wage recovery period is consistent with the language found in section 80, consistent with the fundamental statutory obligation on an employer to pay wages to an employee for work performed and consistent with the expressed purposes of the Act, with its objectives and with the remedial nature of the legislation. It is the correct decision and reconsideration is both unnecessary and unwarranted.
[191] I find those reasons to be devoid of any real substantive analysis of the
Tribunal’s application of its highly-expansive interpretation of a statutory-limiting
provision to a unique set of facts that resulted in a Complaint for approximately
$12,000 giving rise to an award of more than $93,000.
[192] Further, the Reconsideration Tribunal not only failed to analyse the provisions
in issue on other than a cursory basis, but then used that cursory analysis to
determine that the Tribunal Decision was “correct.” In doing so, the Reconsideration
Tribunal failed to apply any of the Tribunal’s own first stage criteria for determining
when reconsideration might be allowed.
[193] As to those criteria, I find that:
1) There is inconsistency between the interpretation of s. 80(1) in the
Tribunal Decision and the Tribunal’s interpretation of similar provisions in
its earlier decisions in Re: Paradigm Management (B.C.) Ltd. (c.o.b.
Expressions Hair Design), [2000] B.C.E.S.T.D. No. 428, BC EST
#D420/00, File No. 2000/304 and Re: Woo, [2002] B.C.E.S.T.D. No. 430,
BC EST #D430/02, File No. 2002/141 that were highlighted by Gulf Coast
in its submissions. Those inconsistencies were not addressed by the
Reconsideration Tribunal in its finding that the Tribunal Decision was
“correct.”
2) The Tribunal’s interpretation of s. 80(1) of the Employment Standards Act
was not only erroneous, but its application of that interpretation to the facts
of this case resulted in serious economic consequences to Gulf Coast by
increasing the amount sought by Mr. Helgesen in the Complaint by almost
eight-fold, without any new substantive investigation into the underlying
facts related to the period for which wage payment was extended.
[194] I am satisfied that the Reconsideration Tribunal failed to exercise any
discretion (or at least any ascertainable discretion) in refusing to allow Gulf Coast’s
Reconsideration Application concerning the Tribunal’s interpretation of s. 80(1) of
the Employment Standards Act. I find that, to that extent, the Reconsideration
Decision is patently unreasonable and must be set aside.
(F) Interpretation of s. 80(1) of the Employment Standards Act
[195] The Tribunal’s interpretation of s. 80(1) of the Employment Standards Act and
its application of that interpretation to the facts of this case is reviewable on two
bases, those being:
1) Through direct review of the Tribunal Decision by reason of my ruling
under s. 57(3) of the Administrative Tribunals Act allowing Gulf Coast’s
application to extend the time for Gulf Coast’s application for judicial
review of the Tribunal Decision to the date of its filing of this petition on
January 25, 2010;
2) Indirectly by reason of the conclusion by the Reconsideration Tribunal that
the Tribunal’s interpretation of s. 80(1) of the Employment Standards Act
was “correct” without undertaking any, or at least any discernable analysis
in determining not to reconsider the Tribunal Decision.
[196] For ease of reference, I will repeat the provisions of s. 80(1) of the
Employment Standards Act as well as the conclusions of the Delegate and the
Tribunal concerning its interpretation, much of which I recorded earlier in this
judgment.
[197] Section 80(1) of the Employment Standards Act provides:
80 (1) The amount of wages an employer may be required by a determination to pay an employee is limited to the amount that became payable in the period beginning
(a) in the case of a complaint, 6 months before the earlier of the date of the complaint or the termination of the employment, and
(b) in any other case, 6 months before the director first told the employer of the investigation that resulted in the determination,
plus interest on those wages.
[198] In interpreting those provisions, the Delegate stated:
The Director’s interpretation of Section 80 is that if employment is ongoing, recovery of wages is limited to wages that became payable in a six month period. Danny Helgesen continued to be employed after the complaint was filed. As a result the audit period in this Determination is limited to the wages that became payable from October 15, 2007 to April 15, 2008.
[199] The Tribunal did not agree with that interpretation, and extended the period of
recovery to the date of the filing of the Director’s Determination, stating:
… I find the delegate erred in law by limiting the “recovery period” to a 6-month interval straddling the date Mr. Helgesen’s complaint was filed. I agree with Mr. Helgesen that the Director could have issued an unpaid wage award spanning the period up to the date of the Determination was issued. I am not finding that Mr. Helgesen is entitled to a further sum reflecting unpaid wages that were earned and became payable after April 15, 2008 – that entitlement is yet to be established. However, I do say that the delegate erred in law in determining that “recovery of wages is limited to wages that became payable in a six month period”.
[200] In support of that interpretation the Tribunal stated, among other things, that:
22. For my part, I do not read subsection 80(1)(a) as creating a "ceiling" limiting a complainant's maximum unpaid wage recovery entitlement to those wages that became payable during the 6-month period dating
back from the complaint filing date. Certainly, and as the Tribunal has repeatedly held, a complainant cannot recover wages that became payable prior to the commencement of the "wage recovery period" (e.g., wages that became payable more than 6 months before a complaint was filed). In the vast majority of appeals that come before the Tribunal, the unpaid wage complaint was filed after the complainant's employment ended and, in such circumstances, the complainant will usually only be able to recover those wages that became payable in the 6-month period immediately preceding the employment termination date. In some rare instances, an employee whose employment has ended may be able to recover wages that were earned before, but only became payable after, the employment ended (Orca Security Corporation, supra, is such a case).
23. However, in the unusual situation where the complainant files a complaint against their current employer, and their employment continues thereafter, I do not interpret subsection 80(1)(a) as limiting their unpaid wage claim to a specific 6-month period. In my view, the reference to "6 months" in subsection 80(1)(a) simply fixes the historical point in time from which the complainant's unpaid wage claim may be calculated but it does not mandate a fixed interval limiting the maximum claim period for any and all unpaid wage claims. If the Legislature had intended to limit all unpaid wage claims under the Act to a defined 6-month interval it could have simply done so by removing the word "beginning" in subsection 80(1) and perhaps by including other directory language in subsections 80(1)(a) and (b). I agree with the Director's position that was also successfully advanced in Orca Security Corporation, supra, namely, that section 80(1)(a) defines the commencement of the wage recovery period but does not necessarily fix the duration of that period (see para. 52).
24. Bhora Mayer's argument that Mr. Helgesen can only recover wages payable within a period not more than 6 months dating back from the date of the complaint is broadly similar to that advanced by the employer in British Columbia Securities Commission v. Burke, 2008 BCSC 1244 with respect to section 51 of the Act (the "parental leave" provision). Section 51(1)(c) states that a birth father is entitled to a leave of "up to 37 consecutive weeks...beginning after the child's birth and within 52 weeks after that event". The employer took the position that Mr. Burke was entitled to parental leave provided it began and ended within 52 weeks after his child's birth, however, the Director determined that Mr. Burke's leave only had to commence within the 52-week post-natal period. The Tribunal confirmed the Director's view and the court, on judicial review, concluded the Tribunal's interpretation of the leave provision was reasonable. In Burke, the B.C. Supreme Court affirmed yet again the well-established principle that the Act is a benefits-conferring statutory scheme and thus ought to be construed liberally in favour of granting rather than limiting benefits (see, e.g., Machtinger v. HOJ Industries Ltd., [1992] 1 S.C.R. 986; Re Rizzo and Rizzo Shoes Ltd., [1998] 1 S.C.R. 27; Merk v. International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, Local 771, [2005] 3 S.C.R. 425). If one
were to give effect to Bhora Mayer's argument that Mr. Helgesen cannot recover any wages after the date of his complaint (even though such wages were earned and payable), the employer would unfairly benefit from the employee's labours — a result that hardly seems consonant with the remedial nature of the Act scheme.
25. It follows from the foregoing comments that I do not accept Bhora Mayer's position regarding the proper interpretation of subsection 80(1)(a). Further, I do not accept the delegate's view, set out at page R10 of the Determination, that section 80 limits a complainant's recovery "to wages that became payable in a six month period" where a complainant has been filed by an employee whose employment has not yet been terminated. Clearly, the Director cannot issue an order, by way of a section 79 determination, for the recovery of wages that are not yet payable. I do find, however, that the Director can order payment of wages that are payable as of the date a determination is issued. Of course, the complainant's complaint form will normally only assert a claim for wages payable as of the date of the complaint. Accordingly, a determination should not be issued for wages that became payable after the complaint was filed unless the employer has been given notice of, and an opportunity to respond to, the claim as it relates to "post-complaint" wages — this follows from the Director's general obligation to respect the rules of natural justice, the section 2(b), (c) and (d) purposes and from the more specific obligation set out in section 77 of the Act.
26. In Orca Security Corporation, supra, the employer argued that section 80 effectively limited the complainants' wage claims (commissions) to a defined 6-month period following termination of employment (see para. 54). The Tribunal rejected this approach and held that the Director was entitled to retain jurisdiction to continue to adjudicate claims for wages that were earned, but were not yet payable, even though such claims might extend beyond a 6-month post-termination period (see paras. 57 — 58). Although Orca Security Corporation does not speak directly to the issue before me, the approach taken by the Tribunal in that case supports my view that section 80(1)(a) establishes a commencement point for an unpaid wage claim and does not, in all cases, create a 6-month maximum recovery period. Thus, and subject to notice and other natural justice considerations, I am of the view that in the case of a continuing employment relationship, the Director may issue a determination for unpaid wages payable as of the date of the determination.
27. If, in the case of an ongoing employment relationship (and, again, it must be emphasized that this is an unusual case since most complainants' employment has already ended when they file their complaints), additional wages become due and payable after the complaint has been filed but before a determination has been issued, I see no sensible reason for requiring the employee to file another complaint and for successive determinations to be issued each limited to a 6-month post-complaint interval. Such a process seems needlessly bureaucratic and not at all in keeping with the stated
purpose of the Act to promote fair and efficient dispute resolution procedures (section 2(d)). It should also be noted that the Director's jurisdiction to investigate a possible unpaid wage issue is not predicated on the existence of a formal complaint (see section 76(2)). Fairness concerns (section 2(b)) can be addressed by ensuring that employers are given notice of, and an opportunity to respond to, claims for unpaid wages that have allegedly crystallized in the post-complaint period. While there appears to be a view within some quarters that Act unpaid wage claims are limited to 6 months there is, in fact, no such express provision in the statute. In the ordinary course of events, where a complainant's employment has ended prior to their having filed a complaint, the wage claim will normally be limited to wages that became payable within the 6-month period preceding the complaint filing date. However, in the unusual case where the employment continues after a complaint has been filed there is nothing in the Act that limits the complainant's unpaid wage claim to a defined 6-month period. Obviously, in such cases, it is preferable if an investigation can be concluded (or a hearing held) and a determination issued as soon as may be reasonably possible after the complaint filing date.
[201] By application of s. 58 of the Administrative Tribunals Act, the standard of
review in both circumstances is whether the Tribunal’s interpretation of s. 80(1) of
the Employment Standards Act and application of that interpretation to the facts of
this case was patently unreasonable.
[202] What may constitute a “patently unreasonable” decision has been the subject
of much debate. In Canada (Attorney General) v. Public Service Alliance of Canada,
[1993] 1 S.C.R. 941, 101 D.L.R. (4th) 673 at 690-91, Cory J. (for the majority) stated:
It is said that it is difficult to know what "patently unreasonable" means. What is patently unreasonable to one judge may be eminently reasonable to another. Yet any test can only be defined by words, the building blocks of all reasons. Obviously, the patently unreasonable test sets a high standard of review. In the Shorter Oxford English Dictionary "patently", an adverb, is defined as "openly, evidently, clearly". "Unreasonable" is defined as "not having the faculty of reason, irrational, not acting in accordance with reason or good sense". Thus, based on the dictionary definition of the words "patently unreasonable", it is apparent that if the decision the Board reached, acting within its jurisdiction, is not clearly irrational, that is to say evidently not in accordance with reason, then it cannot be said that there was a loss of jurisdiction. This is clearly a very strict test.
In C.A.I.M.A.W., Local 14 v. Paccar of Canada Ltd. (1989), 62 D.L.R. (4th) 437, [1989] 2 S.C.R. 983, 40 Admin. L.R. 181, La Forest J. (Dickson C.J.C. concurring) laid out the strict test of review at p. 453:
Where, as here, an administrative tribunal is protected by a privative clause, this court has indicated that it will only review the decision of the board if that board has either made an error in interpreting the provisions conferring jurisdiction on it, or has exceeded its jurisdiction by making a patently unreasonable error of law in the performance of its function …
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.
[203] Counsel for Mr. Helgesen submitted that I must assess the reasonableness of
the Tribunal’s interpretation of s. 80(1) of the Employment Standards Act on the
basis that if it was of a number of possible interpretations, it could not be “clearly
irrational.”
[204] I do not agree.
[205] What is at issue in this case is the interpretation of a limiting provision in an
enabling statute that goes to the statutory jurisdiction of the Director to enquire into
and decide the Complaint.
[206] In Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27 [Rizzo], the Supreme
Court of Canada stated:
21 Although much has been written about the interpretation of legislation (see, e.g., Ruth Sullivan, Statutory Interpretation (1997); Ruth Sullivan, Driedger on the Construction of Statutes (3rd ed. 1994) (hereinafter “Construction of Statutes”); Pierre-André Côté, The Interpretation of Legislation in Canada (2nd ed. 1991)), Elmer Driedger in Construction of Statutes (2nd ed. 1983) best encapsulates the approach upon which I prefer to rely. He recognizes that statutory interpretation cannot be founded on the wording of the legislation alone. At p. 87 he states:
Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.
Recent cases which have cited the above passage with approval include: R. v. Hydro-Québec, [1997] 3 S.C.R. 213; Royal Bank of Canada v. Sparrow Electric Corp., [1997] 1 S.C.R. 411; Verdun v. Toronto-Dominion Bank, [1996] 3 S.C.R. 550; Friesen v. Canada, [1995] 3 S.C.R. 103.
[207] Also, as a remedial statute, the Employment Standards Act “must be given
such fair, large and liberal construction and interpretation as best ensures the
attainment of its objects.” (See: Interpretation Act, R.S.B.C. 1996, c. 238, s. 8).
[208] Neither the approach adopted by the Supreme Court of Canada in Rizzo nor
the mandated direction of the Interpretation Act endorse an approach to statutory
interpretation that authorizes an administrative tribunal to exceed its jurisdiction
beyond that given to it by the legislature. Such an interpretation is not only irrational,
but clearly so because no administrative tribunal may unilaterally expand its
mandate or authority.
[209] I am satisfied that the Tribunal’s interpretation of the limiting provisions of
s. 80(1) of the Employment Standards Act, and its application of that interpretation in
this case, resulted in the Tribunal exceeding its jurisdiction in relation to the
Complaint.
[210] I reach that conclusion for the following reasons:
1) In their grammatical and ordinary sense, the provisions of s. 80(1)(a) of
the Employment Standards Act refer only to past, not future, periods of
employment.
2) Section 80(1)(a) of the Employment Standards Act limits the period of
recovery to the amount that became payable in the period beginning six
months before the earlier of the date of the complaint or the termination of
employment.
3) Similarly, s. 80(1)(b) limits the period of recovery to the amount that
became payable in the period beginning six months before the Director
first told an employer of the investigation that resulted in a determination.
4) Although s. 80(1)(b) does not apply in this case because of the filing of the
Complaint, the two provisions should be read harmoniously, and the
inclusion of the word “before” in s. 80(1)(b) reinforces the plain
grammatical meaning of s. 80(1)(a) as applying to limit recovery in any
single complaint to past periods of employment.
5) There is no differentiation in the Employment Standards Act itself between
the processing of complaints related to situations involving continued
employment and employment that has been terminated, and as evidenced
by Mr. Helgesen’s filing of successive complaints on December 16, 2008,
and June 2, 2009, the provisions of s. 80(1)(a) do not preclude the filing of
more than one complaint by which to initiate further investigation of
alleged further or continuing breaches of the Employment Standards Act.
6) The Tribunal’s conclusion that in the case of a continuing employment,
s. 80(1)(a) of the Employment Standards Act “simply fixes the historical
point in time from which the complainant’s unpaid wage claim can be
calculated but it does not mandate a fixed interval limiting the maximum
claim period for all unpaid wage claims” ignores the fact that what is at
issue in a complaint is a specific period of complaint and a specific
quantum of unpaid wages.
7) The Tribunal’s conclusion and Mr. Helgesen’s submission that the failure
of the legislature to include an “end date” as well as a “beginning date” in
limiting the length of time for which recovery can be made under a specific
complaint, fails to recognize that the filing of a complaint establishes the
end date in a case of continued employment, just as the termination of
employment will establish (when no earlier complaint is filed) the “end
date” for the six month recovery period when employment has ended.
8) If the date of the filing of a complaint is not the “end date” for the six month
period, the differentiation in timing between “the earlier” of the date of the
complaint or the termination of employment becomes meaningless.
9) When the filing of a complaint is determined to be the “end date” for the
purposes of interpretation in cases of continued employment, the
authorities relied upon by the Tribunal to extend the period for which
recovery is available to any other date are of no application.
10) The Tribunal itself acknowledged the inherent difficulty with its “open
ended” interpretation of s. 80(1)(a) of the Employment Standards Act
when it observed that “[o]bviously in such cases, it is preferable if an
investigation can be concluded (or a hearing held) and a determination
issued as soon as may be reasonably possible after the complaint filing
date.”
11) As can be seen in this case, the Tribunal’s interpretation of s. 80(1)(a)
resulted in Gulf Coast’s exposure, in a Complaint for approximately
$12,000, to escalate to almost $93,000 solely as a consequence of the
delay by the Delegate in completing his investigation and issuing the
Director’s Determination more than 13 months after the date of the
Complaint, in circumstances where Gulf Coast had no ability to stop the
increase in exposure.
12) There is no legislative provision or compelling rationale for the setting of
the issuance of a determination as the “end date” for the purposes of
determining the statutory limitation of a complaint period.
13) The Tribunal’s conclusion that the date of issuance of a determination
establishes the limit of an employer’s potential liability, is arbitrary.
14) Such an interpretation of legislation that is intended to promote
procedural efficiency and provide for a just, inexpensive and speedy
resolution of claims for relatively modest amounts of money, is not only
unreasonable but patently so.
[211] The Tribunal’s interpretation of s. 80(1)(a) of the Employment Standards Act
was not only arbitrary and unreasonable; it was also unnecessary because
Mr. Helgesen filed successive complaints which could and should have been
considered and if the Director deemed it appropriate to do so, investigated.
X. CONCLUSION
[212] My determination that the Tribunal’s interpretation of s. 80(1)(a) of the
Employment Standards Act is patently unreasonable requires that the
Reconsideration Decision, the Tribunal Decision and the Director’s Recalculation
Determination, which arose only as a consequence of the Tribunal’s interpretation of
s. 80(1)(a), be set aside.
[213] I have also concluded that in these circumstances, the appropriate and
necessary relief is to direct the Director to complete the investigation of the
Complaint by determining the amount of Mr. Helgesen’s wage entitlement from Gulf
Coast solely for the six month period before the filing of the Complaint on January 8,
2008.
[214] In making that direction, I rely upon the similar disposition made by the Court
of Appeal in Taiga Works Wilderness Equipment Ltd. v. British Columbia (Director of
Employment Standards), 2010 BCCA 97, 3 B.C.L.R. (5th) 103.
[215] I make no specific ruling concerning the Director’s consideration or
investigation of Mr. Helgesen’s successive complaints of December 16, 2008, and
June 2, 2009, other than to say that I consider the evidence tendered by Gulf Coast
which the Reconsideration Tribunal refused to admit as new evidence, should be
considered by the Director in any assessment of those complaints.
[216] Unless there are matters of which I am unaware, having regard to the divided
success of the parties and also Gulf Coast’s lack of success on many issues that
occupied a considerable amount of hearing time, I order that each of the parties bear
their own costs of this judicial review proceeding.
“Davies J.”