FPSLREB Decisions

I. Individual grievance referred to adjudication

1 Andrew Amos (“the grievor”) has referred to adjudication a grievance against the termination of his employment. Mr. Amos contends that the employer is estopped from invoking the reasons for termination of his employment because of the terms of an earlier settlement agreement. He made a motion to declare the discipline void as a result of that settlement agreement. The parties made a joint recommendation that the scheduled hearing dates be used solely to address the grievor’s motion. After hearing the submissions of the parties at a pre-hearing conference, I accepted that recommendation. This decision relates solely to the motion.

2 The Department of Public Works and Government Services (“the respondent”) objected to the introduction of any evidence about mediation discussions because it was unnecessary extrinsic evidence and because it was a breach of the privilege attached to mediation discussions. I reserved on this objection. As noted in Collective Agreement Arbitration in Canada, 4th ed. (LexisNexis Canada, 2009), for reasons of efficiency, and as a practical matter, adjudicators will generally accept extrinsic evidence pending a ruling on whether that evidence is admissible (at paragraph 2.49).

3 A term of the memorandum of agreement (MOA) between the parties was that the content of the settlement was confidential. Accordingly, I ordered that exhibit sealed, and I have referred in this decision only to the parts of the settlement necessary for concluding the preliminary matter (the motion). In addition, other documents related to the mediation and settlement have been sealed: Exhibit E-2, tabs 1 to 4.

4 An order excluding witnesses was requested and granted. One witness testified on behalf of the grievor and the grievor also testified. Four witnesses testified for the respondent.

5 For the reasons set out later in this decision, I have determined that I do not need extrinsic evidence (including evidence of the mediation discussions) to determine the grievor’s motion to declare the discipline void. Accordingly, I have neither summarized nor considered that evidence.

6 Some of the evidence introduced at the hearing related to the conduct of the investigation that preceded the termination of Mr. Amos’ employment. This evidence is not relevant to this preliminary matter, and I have not considered it.

7 The grievor made submissions and adduced evidence on his actions and those of the deputy head after the MOA was signed, alleging that he was induced to believe that his employment was not in jeopardy. This evidence is not relevant to this preliminary matter. It may be relevant for the hearing of the grievance on the merits.

8 Evidence was elicited from a number of witnesses about the implementation of the settlement agreement. The respondent has already conceded that it breached the requirement in the settlement to engage in discussions with the grievor (Amos v. Deputy Head (Department of Public Works and Government Services), 2009 PSLRB 61 (“Amos no. 2”), at para 1). The issue of remedy for that breach is currently before another adjudicator. That matter has been put into abeyance pending the outcome of a judicial review application.

II. Summary of the evidence

9 Mr. Amos’ employment was terminated on February 2, 2009 on the grounds of conflict of interest.

10 In 2005, Mr. Amos received a disciplinary suspension for a matter not related to the conflict of interest allegations and not related to the eventual termination of his employment. Mr. Amos grieved that disciplinary suspension and the grievance was referred to adjudication. After a hearing in late 2006, the grievance was settled on May 2, 2007.

11 The MOA (Exhibit G-4 and Exhibit E-2, tab 4) contains the following paragraph that Mr. Amos contends resolved all matters, including the conflict of interest issues that eventually led to his termination of employment:

The parties hereby agree:

1.    To participate in a meeting or meetings as reasonably required, with a view to discussing and resolving issues of mutual interest relating to the grievor’s working relationship with PWGSC. This process shall take place as soon as practicable. It is the intent of both parties to establish a positive working relationship for their mutual benefit for the future.

12 Other relevant parts of the MOA are as follows:

The parties agree to settle the reference to adjudication PSLRB file no. 566-02-10 and to accept the following terms and conditions in full satisfaction of all claims against the Employer in any way related to the subject matter of this grievance …

…

The grievor hereby agrees:

1.    To withdraw from adjudication the grievance, PSLRB file no. 566-02-10, and to withdraw any other grievance or proceeding related to this reference to adjudication …

…

The Parties hereby agree:

…

2.    That this agreement constitutes full and final settlement of the specific issues and conditions associated or in any way related to this reference to adjudication …

…

13 The agreement was signed by Mr. Amos and his counsel, David Bright. Jean Quevillon, a labour relations manager with the respondent, and Harvey Newman, counsel, signed on behalf of the deputy head.

14 The investigation of conflict of interest allegations against Mr. Amos commenced sometime in 2006. Mr. Amos was interviewed about the allegations in February 2007.

15 The grievor’s representative first raised the grievor’s position that the MOA addressed the alleged misconduct relied on by the deputy head in the termination of employment in a grievance presentation on July 9, 2009 (Exhibit G-8). The grievor argued that at the time that the parties signed the MOA the deputy head was fully aware of all the material facts related to the alleged misconduct.

III. Summary of the arguments

16 Both parties presented written submissions at the hearing. I have summarized the relevant portions. Since those submissions referred to evidence that I had ordered sealed, I have determined that they should also be sealed.

A. For the grievor

17 The respondent was aware of all the details of the conflict of interest allegations before the signing of the MOA. The MOA induced Mr. Amos to believe that all the concerns about the conflict of interest could be resolved. The deputy head allowed Mr. Amos to proceed for months on the basis of that understanding. The use of the phrase “for their mutual benefit,” is all encompassing. If the deputy head had wanted to exclude the conflict of interest investigation and possible outcomes from the MOA, it could have clearly stated so. If he had known the deputy head’s intentions, would the grievor have signed the agreement? And, how would this knowledge have changed the grievor’s approach to the investigation after signing the MOA? Mr. Amos was promised a serious course of action on the part of the deputy head, on which the grievor acted accordingly, to his detriment. In the end, the deputy head made representations through the MOA that a termination of employment was not possible (since a termination of employment cannot be defined as a mutual benefit). The deputy head is now estopped from reneging on those representations.

18 The deputy head opted for a “happily ever after” scenario when it agreed that both parties would together enjoy a mutually beneficial future. The language was purposely kept broad and all encompassing to address all outstanding issues while still obtaining firm commitments for the final resolution of the then-current issues and a mutually beneficial future. The MOA language is abundantly clear — issues were to be discussed and resolved, and the future was going to be mutually beneficial. If the deputy head had wanted to exclude the conflict of interest investigation from the issues of mutual interest it could have done so simply by express language.

19 I was referred to Munroe v. Treasury Board (Correctional Service of Canada), 2010 PSLRB 56, for the principles of estoppel. In Mr. Amos’ case, a representation was made by the deputy head, on which it was intended that Mr. Amos would act, which he in fact did. In this case, there was detrimental reliance on the part of Mr. Amos. In addition, it is unconscionable to allow the deputy head to resile from its stated agreement. Mr. Amos would have behaved entirely differently had known the deputy head’s true intentions.

20 I was also referred to Molbak v. Treasury Board (Revenue Canada, Taxation), PSSRB File No. 166-02-26472 (19950928), and to Webb v. Treasury Board (Foreign Affairs and International Trade), PSSRB File No.166-02-28379 (19981221).

21 Mr. Amos has suffered a number of losses as a result of the actions of the deputy head, including financial and reputational losses, and his health and quality of life have also been damaged as a result of the unjustified termination. A separate hearing will be required to assess damages.

B. For the deputy head

22 The respondent submitted that the grievor’s allegation that he had received a “clean slate” on the allegations of conflict of interest was a serious allegation that goes to the heart of the labour relations process. The burden is on the grievor to prove his allegation, and clear and cogent evidence is required.

23 The general rule is that extrinsic evidence is not to be used when interpreting an agreement unless there is an ambiguity in the agreement (Collective Agreement Arbitration in Canada, at para 2.48).

24 The whole of the MOA must be reviewed to determine the intent of the parties. It is inconceivable that experienced counsel would draft the MOA the way it was if the intention was to provide the grievor a clean slate. The conflict of interest investigation was a separate process, with no predetermined outcome.

25 The first time that the grievor raised this argument was after the referral to adjudication. It is inconceivable that the grievor would not have raised it during the disciplinary process.

26 The grievor’s position is baseless, and the fact that he pursued this allegation should reflect adversely on his credibility.

C. Grievor’s rebuttal

27 The deputy head reneged on its commitment to a clean slate only after the termination of employment. It would not have been appropriate to raise the issue earlier.

28 The MOA is not clear; it is ambiguous. The settlement addresses issues beyond the initial discipline of 20 days, and it was intended to resolve other issues.

IV. Reasons

29 The use of extrinsic evidence in interpreting settlements of grievances should always be done under exceptional circumstances — namely, when there is an ambiguity in the agreement. This principle derives from contract law and is also derived from the sound labour relations principle of encouraging parties to settle their own disputes (Canadian General-Tower Ltd. v. United Rubber Workers, Local 292 (1990), 12 L.A.C. (4th) 153, at 155).

30 To consider extrinsic evidence, the ambiguity must be either evident on the face of the agreement or be latent (an ambiguity that is not apparent on a plain reading of the document). In Christian Labour Association of Canada v. Crown Electric, [1978] OLRB Rep. April 344, at paragraph 13, the Ontario Labour Relations Board noted that a distinction must be drawn between a latent ambiguity and a mere difference of interpretation of words that are not otherwise ambiguous. That board stated that the fact that there may be two arguably different interpretations of a set of words does not establish latent ambiguity:

… Because of the greater evidentiary value of written instruments and the general need for legal finality, courts and boards of arbitration alike have declined to admit extrinsic evidence that would do no more than establish the possibility of two contrary and self-serving interpretations.

31 In International Nickel Co. of Canada Ltd. v. United Steelworkers (1974), 5 L.A.C. (2d) 331, at 333, the arbitrator noted that if latent ambiguity were broad enough to include all cases of “doubtful meaning,” it would open the door to the admission of extrinsic evidence whenever a disagreement arose on interpreting a document. In addition, it would greatly reduce the strength of settlement agreements and would render the rules on extrinsic evidence essentially meaningless. Parties should always be under the pressure of knowing that the words on which they agree in a settlement are designed to finally resolve the dispute before them. If access to adjudication for the interpretation of those words is too readily given, parties will lose that incentive. As stated as follows in Crown Electric:

…

17. Parties who enter into written settlements have a responsibility to ensure that they are fully aware of the implications of any documents to which they attach their signatures. In the absence of any allegation of fraud the Board must assume that parties have agreed to any settlement plainly expressed in a written document, or otherwise no settlement would be immune from a subsequent challenge.

…

32 The clause of the MOA at issue must be examined in the context of the whole of the MOA. It is clear from a reading of the whole document that the purpose of the MOA was to resolve the disciplinary suspension. At a number of points in the document, the parties reiterate that the MOA was to resolve only the grievance that had been referred to adjudication. At the time the agreement was signed, the suspension was the only discipline on record for the grievor. The words in the clause at issue may be vague, but they are not ambiguous:

The parties hereby agree:

1.     To participate in a meeting or meetings as reasonably required, with a view to discussing and resolving issues of mutual interest relating to the grievor’s working relationship with PWGSC. This process shall take place as soon as practicable. It is the intent of both parties to establish a positive working relationship for their mutual benefit for the future.

33 The first sentence requires the parties to have a meeting or meetings “with a view to” both discussing and resolving “… issues of mutual interest relating to the grievor’s working relationship …” with the respondent. In essence, this is an agreement to have a discussion. Although the goal of resolving unidentified issues is clearly stated, it does not mean that those issues will be resolved. The second sentence also relates to process as it refers to the timing of the discussion. The last sentence could either relate to the purpose of the discussions or be a more general statement of intent. However, it cannot be interpreted as a broad guarantee that there will be a “… positive working relationship for their mutual benefit …” for some undefined future period. Although awkwardly worded, it simply states that the parties will work on their relationship in good faith. It speaks only to the intentions of the parties and not to any outcome of discussions. Nothing in the clause is ambiguous on its face.

34 Extrinsic evidence will not assist the grievor in uncovering any latent ambiguity in the MOA. No words in it could become ambiguous after examining extrinsic evidence. The intent of the parties is captured in the MOA, so evidence of what the grievor or his counsel were thinking before signing it could not reveal a latent ambiguity. Events after the signing of the MOA cannot retroactively create an ambiguity. Events after the signing of an agreement can only reveal different interpretations of that agreement. The purpose of extrinsic evidence is only to aid the understanding of the parties’ intentions when they signed an agreement. Post-agreement evidence does not assist in such an exercise.

35 It seems that the real argument of the grievor is that, had the deputy head complied with the agreement (which it has conceded it did not) the conflict of interest allegations would have been resolved, and his employment would never have been terminated, which amounts to an argument of “what ifs.” This is fundamentally different from saying that the MOA provided the grievor a clean slate.

36 The grievor has also argued that he detrimentally relied on the representations made by the deputy head in the MOA. I have already addressed the proper interpretation of the clause in question. Mr. Amos may have read the clause in a different way, but that does not change the intent of the MOA. Hindsight is always 20-20. It is clear that Mr. Amos would likely have taken different steps had he known that his employment would be terminated. However, one cannot create an estoppel by looking backwards from a result (termination of employment) not in the contemplation of the parties at the relevant time.

37 I cannot use the grievor’s preliminary motion to impugn his credibility, as suggested by the deputy head. Evidence alone should be used to attack the credibility of a witness. Parties (both respondent and grievor) often make motions, some of which adjudicators determine unfounded. It would hardly be fair to use the fact that a party raised a preliminary issue as a “hammer” to that party’s credibility.

38 For all of the above reasons, I make the following order:

V. Order

39 The grievor’s preliminary motion is dismissed.

40 The hearing on the merits of the grievance will proceed on dates to be determined by the Public Service Labour Relations Board.

November 2, 2010.

Ian R. Mackenzie,
adjudicator