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Supreme Court of Canada

Labour relations—Arbitration—Collective agreement with bridging provision—Collective bargaining—Strike commenced after failure of conciliation—Whether collective agreement still in force—Jurisdiction of arbitration board—Justification for interfering with arbitral award—The Labour Relations Act, R.S.O. 1970, c. 232, ss. 37(1), 44.

The issues in appeal arose out of a strike in a group of hotels in southern Ontario between February 1, 1971, and March 8, 1971, after which the hotel owners, alleging that the strike was unlawful, submitted a claim for damages against the Union to arbitration. The status of the strike depended on the construction of Article 13 of the agreement, which in addition to providing for the term of the agreement and its termination, contained a bridge provision that the agreement remained in effect until a new agreement was negotiated and concluded. There was an apparent conflict in the provisions of Article 13, with 13.01 providing for a notice to bargain which implicitly included a method of termination and 13.02 maintaining the agreement in effect until a new agreement had been concluded. Prior to the end of the term of the agreement, following a notice to bargain given by the Union, negotiations took place and subsequently a conciliation officer failed to effect agreement between the parties. Fourteen days after a “no-board” report, i.e. that it was not advisable to appoint a conciliation board, the strike commenced. The questions then were whether there was a collective agreement in force during the work stoppage and whether an arbitration board could properly interpret the agreement so as to determine whether it was in effect i.e. whether or not the board itself was properly constituted and had jurisdiction. The majority of the Arbitration Board found that Article 13.02 overrode 13.01 and that there was an agreement in effect. The Divisional Court took the view

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that s. 44(2) of the Act operated to continue Article 13.02 for one year less a day or until a new agreement was concluded and dismissed the Union’s application to quash. The Court of Appeal also found that the strike was unlawful.

Held: The appeal should be allowed.

Per Laskin C.J. and Martland and Ritchie JJ.: The threshold issue is the scope of review of the decision of the Board. Although review of such an award for error of law is open in the absence of a privative statutory provision, the concept of error of law is an elusive one where it turns on the interpretation of words in a collective agreement involved in the arbitration. If the Board has given the relevant words an interpretation which they could reasonably bear, the courts will not generally interfere. There are two limitations on the policy of non‑interference. The first is where a question of jurisdiction is involved and the second is where a statute falls to be construed by the Board. While at first blush the present case appears to involve both of those limitations, the mere fact that the Board was called on to determine whether the agreement remained in effect pursuant to Article 13.02 did not mean that its decision involved a question of jurisdiction in view of s. 37(1) of The Labour Relations Act and the agreement of the parties that arbitrability should itself be within the jurisdiction of an arbitration board. Further, neither subs. (1) nor (2) of s. 44 apply. A year to year extension subject to a fixed provision for termination is specific, not unspecified as envisaged by subs. (1), and subs. (2) does not apply since it concerns an extension made after the commencement of the operation of a collective agreement or after its termination and not as an initial term thereof. Article 13.02 represents an attempt by the parties to keep their agreement alive pending bargaining and conciliation and is reconcilable with Article 13.01 when viewed as a supplement in accordance with the scheme of The Labour Relations Act. In the circumstances, any doubt as to whether the award should be interfered with or not should be resolved in favour of the appellants. When the renewal bargaining ended and there followed conciliation and a “no-board” order, the Union was free to strike when it did without being bound by a collective agreement not to do so.

Per Spence, Pigeon, Dickson, Beetz, Estey and Pratte JJ.: Section 37(1) of The Labour Relations Act answers the question of jurisdiction. That section makes all matters subject to arbitration including “any question as to whether a matter is arbitrable”. There is no other practical solution since if the Board cannot determine whether the agreement is in effect and hence its own

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proper existence, it is difficult to find the jurisdiction elsewhere. If the Board is wrong in law as to the pendence of the agreement, its decision is a nullity and thus within reach of a court of law. The appeal can be disposed of with the determination of one question only, that is, the effect in law of the notice to bargain given by the appellant. That notice to bargain under Article 13.01 effectively terminated the agreement at the expiry term on November 30, 1970, and invoked the collective bargaining process under The Labour Relations Act, a process which came to an end when the Minister on receipt of the conciliation officer’s report determined not to appoint a Conciliation Board. Section 70(1)(a)(ii) of the statute provides that 14 days thereafter the parties are free to strike or lock-out and in the interim s. 70 applies. This conclusion is consistent with the intention of the parties expressed in the agreement and with the pattern established by the statute.

[General Truck Drivers Union Local 938 et al. v. Hoar Transport Company Limited, [1969] S.C.R. 635 aff’g (1968) 67 D.L.R. (2d) 484 sub nom. R. v. Weiler et al., Ex Parte Hoar Transport Co. Ltd.; McLeod v. Egan, [1975] 1 S.C.R. 517, referred to.]

APPEAL from a judgment of the Court of Appeal for Ontario[1] dismissing an appeal from a judgment of the Divisional Court[2] dismissing an application to quash an arbitration award. Appeal allowed, arbitration award quashed.

Ian Scott, Q.C., and G.G. Paliare, for the appellants.

Claude Thomson, Q.C., and Gavin MacKenzie, for the respondents.

The judgment of Laskin C.J. and Martland and Ritchie JJ. was delivered by

THE CHIEF JUSTICE—I have a different approach to the issues in this appeal than that reflected in the reasons for judgment of my brother Estey which I have had the advantage of reading. To me the threshold question is the scope of review of the decision of the arbitration board to which was referred the employers’ claim for damages for an allegedly unlawful strike. Although review of the arbitration board’s decision for error

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of law on the face of the record is open in the absence of a privative statutory provision, the concept of error of law is a very elusive one where it turns on the interpretation of words of a collective agreement which are involved in the arbitration. That is why courts generally, and certainly this Court, have taken the position that if the arbitration board has given the relevant words of the collective agreement an interpretation which those words could reasonably bear, they will not interfere with the arbitration board’s determination.

There are two limitations on the policy of noninterference. The first is where a question of jurisdiction is involved, and the second is where a statute falls to be construed by the board of arbitration (as in McLeod v. Egan[3] in the course of its consideration of the grievance which is before it. I think it is wrong for a court to turn an alleged error of law into a question of jurisdiction, based merely on the court’s disagreement with the construction put upon words of the collective agreement by the board of arbitration. If the construction by the board of arbitration defies common sense, it is perforce a construction which the words in question cannot reasonably bear, and interference is warranted by reason of error of law without having to distort the issue by invoking excess of jurisdiction as the ground of interference.

The present case appears, at first blush, to involve both of the limitations on non-interference which I have mentioned. The grievance before the arbitration board was brought under the very collective agreement whose continued existence during the period of the strike was the only issue before the tribunal. Further, the effect of articles 13.01 and 13.02 of that collective agreement engaged, in the view of the arbitration board and of the Ontario Divisional Court and the Ontario Court of Appeal, certain provisions of The Labour Relations Act, R.S.O. 1970, c. 232 and especially s. 44.

In my opinion, the mere fact that the arbitration board was called upon to determine whether, despite the notice to bargain given by the Union pursuant to article 13.01 of the collective agree-

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ment, the agreement remained in effect pursuant to article 13.02, did not mean that its decision involved a question of jurisdiction. Of course, if it had determined that the collective agreement was not in force during the period of the strike, that determination could have been taken to mean that the board itself should not have been established under the agreement; in short, no agreement, no board pursuant to its terms, unless specially constituted by the parties. The parties here provided however, in their collective agreement that arbitrability should itself be within the jurisdiction of a board of arbitration, as indeed is directed by s. 37(1) of The Labour Relations Act. I consider the question of the duration or subsistence of the collective agreement under its termination terms to be subsumed under the issue of arbitrability confided to the board. It may be that prior to the enactment of s. 37(1) an issue of arbitrability, although one that a board could properly determine (lest it be stultified by a mere objection to its right to proceed), was fully reviewable as raising a jurisdictional question, but I do not regard this as any longer true in the light of s. 37(1) and of the provisions of a collective agreement which, as here, bring arbitrability expressly within the scope of authority of an arbitration board.

What then of the involvement of s. 44 of The Labour Relations Act in the decision of the arbitration board and, as well, in the decisions of the Ontario Divisional Court and the Ontario Court of Appeal? There is, of course, a prior issue of construction of article 13 before resort may be had to any statutory provisions relating to the effect or effectiveness of the provisions of that article. What we have here, however, is a necessary reference to the policy of The Labour Relations Act, as reflected in all its terms, as an aid to the construction of the provisions of article 13 because in their stark and literal language there is a clear incompatibility between article 13.01 and 13.02. They read as follows:

Article 13—Duration and Termination of Modification

13.01 This Agreement shall become effective on the 1st day of December, 1968, and shall remain in full force and effect until the 30th day of November, 1970, and

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shall continue in effect from year to year thereafter unless either party shall give written notice not more than sixty (60) days and not less than thirty (30) days before the date of its termination of its desire to amend the Agreement.

13.02 This Agreement remains in effect until a new agreement has been negotiated and signed, but when the new agreement has been signed this Agreement becomes null and void.

In my opinion, article 13.02 had in view the prescriptions of The Labour Relations Act relating to bargaining for a renewal agreement and to the conciliation procedures associated therewith. It reflected the faith of the parties that such bargaining, aided by a conciliation officer and, possibly, by the services of a conciliation board would result in a collective agreement. It would be only during such procedures that the terms of the existing agreement would continue to operate; once those procedures were exhausted, the parties would be free to resort to economic pressure, be it a strike or lockout. I do not, therefore, agree with the views of either the board majority or the majority of the Divisional Court or the majority of the Ontario Court of Appeal that s. 44 of the Act, either as to subsection 1 thereof or subsection 2, has any application to article 13 of the collective agreement.

Subsections (1) and (2) of s. 44 are as follows:

44. (1) If a collective agreement does not provide for its term of operation or provides for its operation for an unspecified term or for a term of less than one year, it shall be deemed to provide for its operation for a term of one year from the date that it commenced to operate.

(2) Notwithstanding subsection 1, the parties may, before or after a collective agreement has ceased to operate, agree to continue its operation or any of its provisions for a period of less than one year while they are bargaining for its renewal, with or without modifications or for a new agreement, but such continued operation does not bar an application for certification or for a declaration that the trade union no longer represents the employees in the bargaining unit.

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Section 44(1) does not apply here because the collective agreement clearly provided for its term of operation, a term which was for more than a year and one which was not unspecified as to duration. In this last connection, a year to year extension subject to a fixed provision for termination is as certain and as specific as is a year to year tenancy which is terminable on giving a fixed period of notice. Nor is subsection (2) applicable because, in agreement on this point with Lacourciere J.A., I am of opinion that it concerns an extension or bridge agreement made after the commencement of the operation of a collective agreement or after its termination and not as an initial term thereof.

In short, in my view, the parties attempted by article 13.02 to keep their agreement alive pending the exhaustion of renewal bargaining and conciliation procedures but expressed themselves lamely. Article 13.02 is reconcilable with article 13.01 by viewing it as a supplement in accordance with the scheme of The Labour Relations Act. It would be a violation of that scheme to ignore the context in which article 13.02 appears and to give it a force independent of the provisions of article 13.01 respecting termination. The fact that s. 70(1) of The Labour Relations Act prescribes a statutory extension of working conditions pending renewal bargaining and exhaustion of conciliation procedures does not, in my opinion, mean that article 13.02 would be surplusage or that it necessarily envisaged a perpetual extension of the collective agreement until a new agreement was in fact concluded. It may as rationally be regarded as specifying a holding position while there is resort to renewal bargaining and conciliation procedures. The board majority’s position appears to me to mean that by agreeing on article 13.02 the parties have contracted out of The Labour Relations Act. This to me is inadmissible.

Holding the views that I do on the interpretation and effect of article 13, I am left with the question whether I should refrain from interfering with the arbitration board’s decision, simply because I would have come to a different conclusion, or

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whether this is a case where either the board’s conclusion involves an interpretation of article 13 which the words thereof cannot reasonably bear or this is a case where statutory considerations (as in McLeod v. Egan, supra) are dominant so that the court need not defer to the board’s view. There is here, as I view the case, a mixture of both these considerations, and, hence, despite the fact that three tribunals have concluded (although for different reasons) that the collective agreement was in force during the strike, I hold that when the renewal bargaining ended and there followed the unsuccessful intervention of a conciliation officer and a ministerial decision not to establish a conciliation board, the Union was free to strike when it did, without being bound by a collective agreement obligation not to do so.

I agree, accordingly, with my brother Estey that this appeal should be allowed and also with his disposition as to costs which, of course, go only against the respondent employers and not against the members of the arbitration board.

The judgment of Spence, Pigeon, Dickson, Beetz, Estey and Pratte JJ. was delivered by

ESTEY J.—The issues on this appeal arose out of a strike in a group of hotels in southern Ontario between February 1, 1971 and March 8, 1971. Following the strike the owners of the hotels submitted to arbitration a claim against the Hotel & Restaurant Employees and Bartenders International Union, Local 197, representing the employees out on strike for damages under the grievance procedures established in a collective agreement dated February 15, 1969, the allegation being that the strike was unlawful. Whether the strike was unlawful depends upon the construction placed upon one article of the collective agreement and this construction in turn calls into question the interpretation of certain provisions in the Ontario Labour Relations Act (R.S.O. 1970, c. 232). The provision in the collective agreement is as follows:

13.01 This agreement shall become effective on the 1st day of December, 1968, and shall remain in full force and effect until the 30th day of November, 1970, and shall continue in effect from year to year thereafter unless either party shall give written notice not more

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than sixty (60) days and not less than thirty (30) days before the date of its termination of its desire to amend the agreement.

13.02 This agreement remains in effect until a new agreement has been negotiated and signed, but when the new agreement has been signed this agreement becomes null and void.

The arguments submitted to this Court and below as to the proper interpretation of the foregoing term of the collective agreement rotated largely around the following provisions in The Labour Relations Act of Ontario:

44. (1) If a collective agreement does not provide for its term of operation or provides for its operation for an unspecified term or for a term of less than one year, it shall be deemed to provide for its operation for a term of one year from the date that it commenced to operate.

(2) Notwithstanding subsection 1, the parties may, before or after a collective agreement has ceased to operate, agree to continue its operation or any of its provisions for a period of less than one year while they are bargaining for its renewal, with or without modifications or for a new agreement, but such continued operation does not bar an application for certification or for a declaration that the trade union no longer represents the employees in the bargaining unit.

The trail of this litigation is long and the dispositions, layer upon layer, are somewhat complex. Suffice it to say that the majority of the Board of Arbitration, the majority of the Divisional Court and the majority of the Court of Appeal found for one reason or another that there was a collective agreement in effect between the parties during the cessation of work and consequently determined that the cessation amounted to an unlawful strike. The issue of damages was deferred until final resolution of the issue as to whether there was a collective agreement in force during the work stoppage.

The threshold problem which reared its head at each level on which this debate has occurred is whether or not an arbitration board may properly interpret a collective agreement so as to determine whether the agreement was in effect at the time of the arbitration; in other words to determine wheth-

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er or not the Board itself was properly constituted and was acting within the contractually conferred jurisdiction. Counsel for the appellant, in fairness to him, did no more than present the argument which I find sufficiently answered by the terms of s. 37(1) of The Labour Relations Act which make all matters subject to arbitration including “any question as to whether a matter is arbitrable.” There is no other practical solution to this question because if the Board cannot determine whether the agreement continues in effect and hence its own proper existence, it is difficult to find the jurisdiction elsewhere. Of course if the Board is wrong in law as to the pendence of the collective agreement, its decision is a nullity, and thus within the reach of a court of law.

In General Truck Drivers Union Local 938 et al. v. Hoar Transport Company Limited[4], this Court affirmed a decision of the Ontario Court of Appeal (reported sub nom. Regina v. Weiler et al., Ex Parte Hoar Transport Co. Ltd.[5] Judson J. (Cartwright C.J.C., Martland and Ritchie JJ. concurring) expressly stated his full agreement with the majority reasons of the Court of Appeal where Aylesworth J.A. said as follows (at p. 489):

What then is the effect of the ruling made by the majority of the board? I think the answer is very clear; the majority by its ruling seeks to reach beyond the agreement and, with complete inconsistency with the terms of the agreement, to clothe itself with a jurisdiction which it does not possess. Under the agreement and by virtue of what occurred, the grievance “shall be deemed to have been withdrawn” and consequently there is no grievance before the board upon which it is called to adjudicate... The board, however, cannot clothe itself with jurisdiction to enter upon a consideration of the grievance by ignoring or altering the substantive provisions of the agreement which are conditions precedent to judicial or quasi-judicial consideration thereof in arbitration.

Particularly as to statutory boards, our Courts have always retained to themselves the power to confine inferior tribunals of limited jurisdiction to the exercise of that jurisdiction. It often will be and in this case is a miscarriage of justice when such jurisdiction is exceeded.

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Turning then to Article 13 of the collective agreement, there is an immediately apparent conflict between its subsections. Subsection 01 provides a method of amendment which implicitly includes a method of determination. Subsection 02 provides that the agreement shall remain in effect until replaced by a new agreement. There may be, however, an interpretative route around this impasse. Each subsection contemplates a continued relationship between the parties under the umbrella of a collective agreement after November 30, 1970, when the initial term expires. Subsection 01 establishes two situations. Firstly, it clearly expresses an agreement between the parties that the contract shall become effective on December 1, 1968 and remain effective until November 30, 1970. Secondly, the subsection clearly evinces an intention on the part of the parties that the agreement shall continue thereafter “unless either party shall give written notice...of its desire to amend the agreement”. This statement does not indicate the consequences of the notice in express terms but implicitly, by commencing with the words “shall continue...unless...”, one is led inexorably to the conclusion that the effect of the notice is to terminate the agreement.

Subsection 02 provides that the agreement shall remain in effect after the expressed initial term until a new agreement has been negotiated and signed. The balance of the subsection is clearly surplusage. The thrust of subsection 02 is to provide for the old agreement continuing without interruption in the event no notice is given under subsection 01. To interpret the clause otherwise is either to give it no meaning apart from that which is already stated in 01, or alternatively to bring it into conflict with both 01 and the entire scheme of the Act which is to provide for periodic negotiation of a new collective agreement, in the form of collective bargaining including mediation and conciliation, all as provided for in great detail in The Labour Relations Act. I will return to this question shortly.

This brings us to s. 44 of the Act. Again it is convenient to discuss the two sections independently in the first stage. Subsection (1) provides that where an agreement fails to provide for an expiry

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date or stipulates a term of less than one year, the collective agreement shall “be deemed” to be for a term of one year. The first question as regards this subsection is whether or not it operates with respect to Article 13.01 to bring about an interpretation of that subsection of the contract that would result in a finding that the contract is for an unspecified term and therefore is deemed to expire after one year, namely November 30, 1969. The parties have clearly contracted otherwise in Article 13.01 and have provided a contract with a terminal date of November 30, 1970. Section 44(1) in my view does not bear such an interpretation.

Subsection (2) of s. 44 which expresses itself to be exceptional to subsection (1) has no application to Article 13.01. The question is, does it apply to 13.02 as an independent renewal or replacement agreement? Subsection (2) of s. 44 has no immediate application in this instance because if Article 13.02 provides anything, it is something other than an agreement of less than a year, and if s. 44(2) has any application, it is to a continuing agreement which has an operational period of less than one year. Unlike subsection (1), subsection (2) has no ‘deeming’ provision so that the terms of the subsection are not automatically transplanted into the collective agreement. Article 13.02 may well have been an attempt by the parties to establish a ‘bridge’ agreement between the expiry of the original term and the settlement of a replacement agreement. If so, the clause offends s. 44(2) which requires that such an agreement be “for a period of less than one year...”. Thus Article 13.02 would on such an interpretation be rendered inoperative by the statute. As I have already stated, s. 44(2) has no ‘deeming’ provision as is the case with s. 44(1), and therefore cannot thereby breathe life into Article 13.02.

It was argued that Article 13.02 fails in its attempt to bridge the gap after November 30, 1970 for the further reason that the wording employed in s. 44(2) may require that any such bridge agreement be entered into after and separate and apart from the initial collective agreement. It is not necessary in the view I take of the meanings and relationship of Article 13 of the

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agreement and s. 44 of the statute to determine this question.

The majority of the Court of Appeal took the view that Article 13.02 of the agreement creates a collective agreement independent of the first agreement (which had a two-year term) and that s. 44(1) limited this independent agreement to a term of one year until November 30, 1971. Hence there was a collective agreement in being at the time of the strike and hence the strike was unlawful. The Divisional Court took the view that s. 44(2) came to the rescue of Article 13.02 and even though s. 44(2) has no deeming provision making it operable where a collective agreement is entered into contrary to the expressed intention of subsection (2), the section did operate to continue the independent agreement born under Article 13.02 for a term of one year less a day or until a new agreement was concluded whichever came first. Hence the strike was unlawful, there being a collective agreement in effect on February 1, 1971. The majority of the Board of Arbitration found that 13.02 overrode 13.01 and created a succession of agreements, one following upon the other without formality unless and until the collective agreement was replaced by a new collective agreement. More accurately, the majority found that 13.02 did not create a new agreement indefinitely and made the term interminable except by the advent of a replacement agreement. The majority of the Board found that neither provision of s. 44 affected Article 13 of the collective agreement and that the pattern of The Labour Relations Act did not require a contrary construction of either the agreement or s. 44.

There are serious consequences for the participants in the field of labour relations were a court to construe the provisions of The Labour Relations Act and the collective agreement in such circumstances as now before us, in such a way as to cause the establishment of a perpetual collective agreement terminable only on the execution of a new collective agreement by the parties. Where not barred by the statute the parties of course can, by unambiguous language, bring about results which

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others might consider to be improvident. In such circumstances the courts may not properly interfere. The scheme of labour relations under the Ontario Act is founded upon collective bargaining leading to a collective agreement and thereafter to replacement agreements. Collective bargaining in turn is an activity in which the parties participate in the full realization of their respective economic positions and strengths subject only to the limitations and boundaries imposed on the parties by The Labour Relations Act. Consequently, collective agreements, which are of course creatures of statute finding both their origin and their extent within the Act, reflect these realities. A court therefore should not be quick to place a meaning on a term of a collective agreement which would put that clause in conflict with the general philosophy of labour relations as established under the applicable statute. Such should be the case only where the contract by its clearest intent and provisions dictates otherwise. I do not find such to be the case here.

Article 13 sets out an initial term during which the collective agreement shall operate and provides for its termination by notice as well as for its continuance in the event no notice is given. As is customary in collective agreements which by axiom find their root in compromise reached usually after active negotiations, the terminology is not that which might be found in a carefully constructed private contract or public statute produced in the quiet of the draftsman’s office. There is of course the inconsistency between the language of 13.01 and 13.02 as regards the termination technique but in the portion dealing specifically with that termination technique the language is sufficiently precise to support an interpretation which will make the section as a whole workable. It is not at all unusual to find provisions akin to 13.01 which leave the actual right to terminate to inference flowing from the delivery of a notice to amend. It is also not infrequent to find in collective agreements provisions in which the parties contemplate a continuance of the agreement beyond the initial term. In the framework of the collective agreement now before us, the 13.02 agreement, to give it a convenient label, even if it is not rendered inoperative as contrary to s. 44(2), never com-

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menced to operate because the notice given in October under Article 13.01 prevented that event.

The disposition of the issue arising in this appeal therefore requires the determination of only one question and that is, what is the effect in law of the notice given in October 1970 by the appellant? While it is not part of the record in this Court (or presumably in any of the tribunals below) it is said by both the appellant and respondent to be “a Notice to Bargain”. In my view the effect of the service of the Notice to Bargain under 13.01 is to terminate the agreement at the expiry of the term on November 30, 1970 and to invoke the collective bargaining process under The Labour Relations Act. This process came to an end when the Minister, on the receipt of the report of the conciliation officer, determined not to appoint a Conciliation Board. Section 70(1)(a)(ii) of the statute provides that 14 days thereafter the parties are free to strike or lock-out as the case may be. In the interim period, s. 70 applies to restrict the rights of the parties in their actions with respect to rates of pay and working conditions, and the right to strike and the right to lock-out are of course during that period suspended. No issue here arises out of the interval prior to the expiry of such statutory period.

The 14-day period ended on January 29, 1971 and the strike occurred on February 1, 1971 when in my view neither the collective agreement nor the applicable statutory provisions were in effect between the parties.

It need only be added that this conclusion is consistent with the intention of the parties as expressed in the collective agreement and with the pattern imposed upon labour relations by the Legislature speaking through The Labour Relations Act. If one bears in mind that the Ontario Labour Relations Act in ss. 13 to 33 and ss. 45 and 46 establishes bargaining mechanisms applicable both to the negotiation of the first collective agreement and to negotiations for successive collective agreements, the terminology employed by the parties in the provisions of the collective agreement under scrutiny takes on a fuller meaning. This machinery may be invoked only within the period of 90 days before a collective agreement

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ceases to operate. The right to strike is suspended or postponed until the procedures prescribed by the statute have been implemented and fully performed. It is difficult therefore against this panorama of labour relations rules to interpret a collective agreement between two parties operating under that statute as an attempt by the parties to get away from those provisions. The language employed here by the parties when given its plain meaning does not produce that result.

Article 13.01 is a case in point. The time limits prescribed by that term of the agreement for negotiation of proposed amendments are compatible with those established in s. 45 of The Labour Relations Act. The subsection clearly establishes a two-year term and then provides for a continuance from year to year unless a notice to amend is given. Article 13.02 may not be read without reference to the overall intent of the parties as evidenced by the agreement read as a whole. If 13.02 is read as requiring a meeting of the minds on a new agreement in order to displace the initial agreement, there would be no point in establishing a procedure for notice to amend under subs 01 as the parties would not in such a circumstance be free to bargain in the ordinary sense of that term. When the alternative to settlement on new proposals is the infinite application of the existing agreement, collective bargaining, as the term is understood in labour relations, will not function. It would take the clearest possible language in my view to drive a court to an interpretation which would find the parties voluntarily stripping themselves of the opportunity to call to their aid the provisions of the statute to change a collective agreement, and to substitute for those proceedings so traditional now in the labour relations of our community, a permanent agreement continuing until both parties agree upon a replacement agreement.

Article 13.01 is the provision in which the parties have expressly directed their minds to their right to terminate the agreement and to the procedure for termination. Article 13.02 is directed at the continuity of the agreement in the absence of action being taken under .01, the delivery of a

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Notice to Amend. To interpret the two provisions otherwise is to bring 13.02 into conflict with s. 44(2) of the Act. It is clear from the provisions of Article 13.01 that the parties had at least some provisions of The Labour Relations Act very much in mind when drafting the agreement and it is, in my view, unsound to construe the agreement, unless there be no other alternative, as being either contradictory to the provisions of the Act or as being a surrender of rights under the Act.

In the judgment of the majority below, Article 13.02 was interpreted by calling into play s. 44(1) once 44(2) was found inapplicable. By this interpretative procedure, a continuing agreement under 13.02, in the same terms as the initial two-year agreement, was found to be operational for the period December 1, 1970 to November 30, 1971. While the technique has its attractions, there appears to be no basis in the Act, and particularly in the wording adopted by the Legislature in s. 44(1) and (2), which authorizes such a sequence of applications of its provisions.

Apart from the reference in s. 44(2) to “notwithstanding subsection (1)”, there appears in my view to be no relationship between subss. (1) and (2). The need for the reference to subs. (1) in subs. (2) arises out of the authorization in the latter of a ‘bridge’ agreement of shorter duration than subs. (1) authorizes for collective agreements. Subsection (1) furthermore is directed to the situation where the collective agreement either has no term or has a term deemed by the Legislature to be inappropriately short. Subsection (2) on the other hand appears to contemplate the situation where the parties may by contract as part of the renewal bargaining process enter into an agreement to prolong the operation of the expired or about to expire collective agreement “while they are bargaining for its renewal”. This would appear to be a consensual alternate to the mandatory statutory minimum agreement, or rather the maintenance of a minimum status quo provided for by s. 70 of the Act. There being no relationship between the two subsections other than as mentioned, and subs. (2) having no application to the circumstances with

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which we are confronted, I cannot with respect agree that s. 44(1) can be applied to Article 13.02 as though it were an independent agreement for which a term must be determined.

The disposition of this proceeding calls into play all the interpretive tools available to a court in construing both a contract and a statute. The conclusions reached by the various majorities below depend of course upon the approach taken in the interpretation of the contract and the statute and their relationship. The minority of the Arbitration Board, T.E. Armstrong for example, concluded:

I do not believe that it was the intention of the Legislature to permit a collective agreement to be fashioned which would perpetually foreclose the right to strike and lockout. Accordingly, I believe that any tenable interpretation of the contract language which will preserve the statutory right to strike in the post-conciliation period, is to be preferred to an interpretation which will negate that right.

Lacourciere J.A., in dissenting in the Court below, stated:

In assessing the significance of this Article 13.02, one must not only follow ordinary canons of construction, but do so in the framework of the Labour Relations Act as a whole as well as modern labour law and practice. The conflicting interests must be weighed realistically and fairly, having regard to the social policy behind the Labour Relations Act as progressively administered by the Labour Relations Board and interpreted by the courts. It is a prevailing assumption in the area of labour conflicts that a union can legally strike, and that a company can resort to lock-out, when conciliation procedures have been exhausted and statutory restraints followed. It is in that context that the article relied upon by the employers must be interpreted. In that respect, I prefer the view stated by T.E. Armstrong, Q.C., in his dissent from the majority award.

With these views I concur with great respect.

I therefore would allow the appeal and set aside the Order of the Court of Appeal and the divisional Court substituting in the place thereof an Order quashing the award of the Board of Arbitration. There shall be costs to the appellant in this Court and in the courts below.

[Page 864]

Appeal allowed with costs, arbitration award quashed.

Solicitors for the appellants: Cameron, Brewin & Scott, Toronto.

Solicitors for the respondents: Campbell, Godfrey & Lewtas, Toronto.

 



[1] (1976), 13 O.R. (2d) 56.

[2] (1975), 7 O.R. (2d) 592.

[3] [1975] 1 S.C.R. 517.

[4] [1969] S.C.R. 635.

[5] (1968), 67 D.L.R. (2d) 484.

 

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