Noyes v. David Morris Fine Cars Ltd., 2011 ABQB 648

Court of Queen ’ s Bench of Alberta Citation: Noyes v. David Morris Fine Cars Ltd., 2011 ABQB 648 Date: 20111025 Docket: 0803 18101 Registry: Edmonton Between: Gaylene Noyes Plaintiff (Respondent) - and - David Morris Fine Cars Ltd. Defendant (Applicant) _______________________________________________________ Reasons for Decision of W. Breitkreuz, Master in Chambers _______________________________________________________ [ 1 ] This is an application by the Defendant to strike out all or part of the Plaintiff’s Statement of Claim and for

summary judgment against the Plaintiff on the ground of issue estoppel. I. Facts [ 2 ] The Plaintiff, Gaylene Noyes, brought an action against the Defendant, David Morris Fine Cars Ltd., for wrongful dismissal.

[ 3 ] The Plaintiff began working for the Defendant in December, 2005 as a financial manager. On November 22, 2006, the Plaintiff began receiving ongoing testing for breast cancer. On January 2, 2007, the Defendant terminated the Plaintiff’s employment. Three days later, the Plaintiff received a formal diagnosis that she had breast cancer and began treatment. [ 4 ] The Plaintiff complained to the Alberta Human Rights Commission on March 26, 2007, alleging that the Defendant discriminated against her on the basis of a physical disability.

An investigator with the Commission interviewed the Plaintiff on April 30, 2008, and the Plaintiff’s supervisors and other employees with the Defendant on May 16, 2008. None of the information given during the interviews was sworn, and neither party was given the opportunity to cross-examine any of the interviewees. [ 5 ] The Plaintiff and her supervisor, Sharon Cromwell, gave conflicting information to the Investigator. The Plaintiff alleged that she informed Mrs. Cromwell about her cancer testing, which Mrs. Cromwell denies.

Notes taken by the Plaintiff after the Defendant terminated her and information given by another employee of the Defendant, Anita Cabral, to the Investigator also indicate that Mrs. Cromwell knew of the Plaintiff’s cancer testing. [ 6 ] The Investigator concluded that the available information did not indicate that Mrs. Cromwell or any of the Plaintiff’s supervisors knew of her cancer testing prior to the Plaintiff’s termination.

Although, earlier in the Report, the Investigator states that “Cromwell was definitely aware that Noyes was being tested.” The Northern Director of the Human Rights Commission adopted the conclusions of the Investigator, and notified the Plaintiff on October 28, 2008, that her complaint was dismissed. [ 7 ] On November 17, 2008, the Plaintiff applied to the Chief Commissioner of the Human Rights Commission for a review of the Director’s decision to dismiss the complaint. The Plaintiff also filed a Statement of Claim for wrongful dismissal on December 23, 2008.

In the Statement of Claim, the Plaintiff alleges that David Morris knew of her disability prior to the decision to terminate her employment and refers to her disability and cancer treatments several times. [ 8 ] On September 10, 2009, the Chief Commissioner decided to uphold the decision of the Director dismissing the Plaintiff’s complaint. The Plaintiff did not seek judicial review of the Chief Commissioner’s decision. [ 9 ] On November 17, 2010, the Defendant applied for all or part of the Statement of Claim to be struck and for

summary judgment against the Plaintiff. II. The Defendant ’s (Applicant) Position [ 10 ] At the hearing for this application, the Defendant abandoned its application for

summary judgment, and its application to strike all of the Statement of Claim. However, the Defendant maintains that parts of the Statement of Claim that mention the Defendant’s knowledge of the Plaintiff’s cancer testing should be struck. [ 11 ] The Defendant argues that any reference to the Defendant’s knowledge of the Plaintiff’s cancer testing, or that the Defendant acted on such knowledge, constitutes an abuse of process and should be struck pursuant to Rule 3.68 of Alberta Rules of Court , Alta.

Reg. 124/2010. [ 12 ] The Plaintiff already litigated the issue of discrimination on the basis of her physical disability before the Alberta Human Rights Commission. The principle of issue estoppel precludes the Plaintiff from raising the same issue again in the context of a wrongful dismissal action before the Court. III. The Plaintiff ’s (Respondent) Position [ 13 ] The Plaintiff argues that this action does not involve the same issue that the Commission considered. She does not link the

Defendant’s prior knowledge of her disability directly to the wrongfulness of the termination, but the Plaintiff admits that the two issuesare intertwined. [14] Even if this case does involve the same issue, the Plaintiff argues that the Court has discretion not to apply the principle ofissue estoppel. This case involves credibility issues which the Investigator could not resolve. A determination of the credibility issuesrequires the investigative tools provided by the trial process. IV. Analysis [15] The Supreme Court of Canada set out three preconditions for issue estoppel in Angle v.

Minister of National Revenue (1974), (SCC), [1975] 2 S.C.R. 248 at 254: 1) That the same question has been decided; 2) That the judicial decision which is said to create the estoppel was final; and 3) That the parties to the judicial decision or their privies were the same persons as the parties to the proceedings in which the estoppel israised.... [16] Even if the three preconditions are met, the Court must still determine whether, as a matter of discretion, it ought to applyissue estoppel: Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44, [2001] S.C.R. 460 at para. 33. (

A) That the Same Question has been Decided [17] The question in this case of the Defendant’s knowledge of the Plaintiff’s disability is the same question that the HumanRights Commission determined. [18] The Plaintiff correctly argues that a wrongful dismissal claim requires different considerations than a discrimination claim.However, different causes of action may involve a similar material fact. Once an adjudicator finds a material fact, the parties cannotquestion that same fact in subsequent litigation: Danyluk, supra at para. 54.

The Plaintiff argues in her Statement of Claim that DavidMorris had knowledge of her disability. The Human Rights Commission expressly found that none of the Plaintiff’s supervisors hadknowledge of her cancer testing. This is the same fact. (

B) That the Judicial Decision Which is Said to Create the Estoppel was Final [19] The second precondition for issue estoppel has two elements.

First, the decision must be judicial, and, second, the decisionmust be final. [20] Justice Binnie, writing for the Court in Danyluk, supra at para. 35, stated that three questions must be asked to determinewhether an administrative authority’s decision is judicial: (1) what is the nature of the administrative authority issuing the decision; (2)as a matter of law, is the particular decision one that was required to be made in a judicial manner; and (3) as a mixed question of law andfact, was the decision made in a judicial manner? [21] In terms of the nature of decision-maker, it must have the power to adjudicate.

Justice Binnie discussed the nature of anEmployment Standards Officer in Danyluk, supra at para. 38: The decision relied on by Rosenberg J.A. in this respect relates to the generic role and function of the ESA officer: Downing v. Graydon,

supra, per Blair J.A., at p. 305: In the present case, the employment standards officers have the power to adjudicate as well as to investigate. Their investigation is madefor the purpose of providing them with information on which to base the decision they must make. The duties of the employmentstandards officers embrace all the important indicia of the exercise of a judicial power including the ascertainment of facts, theapplication of the law to those facts and the making of a decision which is binding upon the parties.

The parties did not dispute that ESA officials could properly be given adjudicative responsibilities to be discharged in a judicial manner. [22] Certainly a Tribunal appointed under the Alberta Human Rights Act, R.S.A. 2000, c. A-25.5, has the power to adjudicate. Inthis case, the investigators findings were approved by the director, and subsequently the Chief Commissioner. This is not the same as anadjudication by a tribunal appointed under the Alberta Human Rights Act.

Unlike Employment Standards Officers, neither Investigators,Directors, nor the Chief Commissioner has the power to find that a complainant’s rights were violated. The Director may dismiss acomplaint if it does not have merit: Alberta Human Rights Act, supra, s. 22. The Chief Commissioner may only appoint, or alternativelyrefuse to appoint, a Tribunal to hear a complaint: Alberta Human Rights Act, supra, s. 27. The investigator simply gathers evidence andreports to the Director.

Employment Standards Officers may find that an employer owes employee wages, or some other remedyprovided by employment standards legislation, or the officer may dismiss the complaint. [23] As for the requirement that administrative authorities must make decisions in a judicial manner, in Danyluk, supra at para. 41,Binnie J. held that “decisions must be based on findings of fact and the application of an objective legal standard to those facts.” [24] The third requirement is a question of whether the decision was actually made in a judicial manner.

The fact that theadministrative authority may not have made its decision in accordance with the principles of natural justice does not preclude its decisionfrom being made in a judicial manner. Courts will consider a decision-maker’s errors in the exercise of its jurisdiction when determiningwhether the Court will exercise its discretion to apply issue estoppel: Danyluk, supra at para. 51. [25] In Ferrare v. Kingston Interval House (2002), (ON SC), 19 C.C.E.L. (3d) 59 (Ont. Sup. Ct.

J.)[Ferrare], Hermiston J. found that issue estoppel did not apply to prevent plaintiffs from bringing a wrongful dismissal action afterhaving their human rights complaint dismissed by the Ontario Human Rights Commission. At the time of the dismissal and the Courtdecision, the Human Rights Commission in Ontario followed a procedure similar to the one prescribed for Alberta. The plaintiffs hadtheir human rights complaints dismissed after investigation, and the Commission never referred the matter to a Board of Inquiry for ahearing.

The decision cites Danyluk, supra, but does not specifically mention the three requirements for a “judicial” decision. At para.14, Hermiston J. held that the plaintiffs never had the benefit of a litigation process, and therefore issue estoppel does not apply toprevent them from arguing the particulars of their human rights complaint in the context of a wrongful dismissal action before the Court. [26] The decision in Ferrare is inconsistent with the Alberta Court of Appeal’s decision in Wong v. Shell Canada Ltd. (1995), (AB CA), 174 A.R. 287 [Wong].

In Wong, supra at para. 19, the Court held that a decision is sufficiently judicial tocreate an estoppel as long as “the appellant knew of the case against him and was given the opportunity to state his position.” [27] Regardless of any deficiencies in the Alberta Human Rights Commission’s procedure, the investigator’s recommendation andthe Chief Commissioner’s decision were based on findings of fact and the application of an objective legal standard to those facts. ThePlaintiff also acknowledged that she knew of the Defendant’s position concerning her complaint and had the opportunity to state herposition.

Therefore, the decision which is said to create an estoppel is a judicial one. [28] The judicial decision must also be final.

Section 35 of the Alberta Human Rights Act, supra, states that, subject to the right ofjudicial review, the decision of the Chief Commissioner on whether a complaint should have been dismissed is final and binding on theparties. (

C) That the Parties to the Judicial Decision or Their Privies were the Same Persons as the Parties to the Proceedings in which theEstoppel is Raised [29] The parties in this action are Gaylene Noyes and David Morris Fine Cars Ltd. The parties in the human rights complaint were

[ 29 ] The parties in this action are Gaylene Noyes and David Morris Fine Cars Ltd. The parties in the human rights complaint were identical. Therefore, there is no question that the parties to the judicial decision are the same persons as the parties to the proceedings in which the estoppel is raised. (

D) Should the Court Refuse to Apply Issue Estoppel as a Matter of Discretion? [ 30 ] Even where the three prerequisites for issue estoppel have been met, the Court has discretion to refuse to apply issue estoppel. In Danyluk , supra at para. 62 , Binnie J. held that “the discretion is necessarily broader in relation to the prior decisions of administrative tribunals because of the enormous range and diversity of the structures, mandates and procedures of administrative decision makers.” [ 31 ] Danyluk , supra , provides seven factors that a court should consider when deciding whether to exercise its discretion to refuse to apply issue estoppel: (

a) the wording of the statute from which the power to issue the administrative order derives; (

b) the purpose of the legislation; (

c) the availability of an appeal; (

d) the safeguards available to the parties in the administrative procedure; (

e) the expertise of the administrative decision maker; (

f) the circumstances giving rise to the prior administrative proceedings; and (

g) the potential injustice. [ 32 ] The list of factors is not closed, and additional factors may be relevant in a particular case. According to Binnie J., the purpose of considering the factors “is to ensure that the operation of issue estoppel promotes the orderly administration of justice but not at the cost of real injustice in the particular case”: Danyluk , supra at para. 67 . (

i) The Wording of the Statute [ 33 ] Unlike the Ontario Employment Standards Act , R.S.O. 1990, c. C.43 , at issue in Danyluk , supra , the Alberta Human Rights Act , supra , does not contain any language indicating that the Act does not affect the civil remedy of a complainant. In addition, the Alberta Human Rights Act , supra , states that the decision of the Chief Commissioner on whether a complaint should have been dismissed is final and binding on the parties.

However, similarly to Danyluk , supra at para. 70 , the Plaintiff brought a civil action before receiving a decision from the Chief Commissioner. (ii) The Purpose of the Legislation [ 34 ] The purpose of the Alberta Human Rights Act , supra , is to establish rights and prohibit discrimination: Gramaglia v. Alberta (Government Services Minister) , 2007 ABCA 93 at para. 22 . On the other hand, the purpose of the investigation process, established in the Act, is to provide the parties with an inexpensive and simple means for resolving complaints.

Neither party requires a lawyer, nor does either party need to make or understand complex legal arguments. Once the complainant makes a complaint, the Commission takes over and attempts to gather the facts. (iii) The Availability of an Appeal [ 35 ] The Plaintiff exhausted the administrative appeal processes available in the Alberta Human Rights Act , supra . The Plaintiff could have applied to the courts for judicial review of the Chief Commissioner’s decision.

(iv) The Safeguards Available to the Parties [36] In terms of the safeguards available to the parties in the administrative procedure, Binnie J. in Danyluk, supra at para. 75,noted that procedures suitable to accomplish the goals of an administrative agency may be inadequate to deal with complex issues of factor law. The absence of safeguards may be a factor in the exercise of the court’s discretion, and in Danyluk it was the key factor. [37] In this case, the Alberta Human Rights Commission’s investigation procedures lack the appropriate safeguards to properlyresolve the Plaintiff’s complaint.

The resolution of the complaint requires an assessment of credibility. The investigator interviewed thePlaintiff and other employees of the Defendant. The Plaintiff and one co-worker stated that other people at the Defendant company knewof the Plaintiff’s cancer testing, but the Plaintiff’s supervisors alleged that they had no knowledge. The Court’s primary tool to assesscredibility is cross-examination, which was not available to the Plaintiff during the investigation. [38] The investigator’s inability to assess credibility appears to have made it difficult for her to make any findings.

On page 14 ofthe Investigation Report, the investigator states that “Cromwell knew that Noyes would be getting the [cancer test] results on January 2or 3" and “Noyes never told [David] Morris about the cancer, but Cromwell was definitely aware that Noyes was being tested.” Then onpage 17, the investigator concludes that “[t]he available information does not support the claim that any Morris employees, other than[Anita] Cabral, were aware that Noyes was undergoing testing for cancer during her employment.” [39] In addition, none of the information presented to the investigator is sworn.

Therefore, the investigator makes arecommendation on the basis of unsworn evidence that has not been subject to cross-examination. (

v) The Expertise of the Decision Maker [40] The Supreme Court of Canada in Canada (Attorney General) v. Mossop, (SCC), [1993] 1 S.C.R. 554 at 585[Mossop], held that a human rights tribunal’s expertise relates to fact-finding. Mossop does not address the expertise of a human rightscommission. The difference between the two is that a tribunal hears sworn evidence, allows cross-examination, and has other powers ofadjudication. The Alberta Court of Appeal in Gramaglia, supra at para. 24, and the Supreme Court of Canada in Cooper v.

Canada, (SCC), [1996] 3 S.C.R. 854 at para. 61, highlight that a human rights commission has less expertise than a tribunal onquestions of law. Both cases make comments that what is true for human rights tribunals is more true for commissions.

These commentsdo not indicate that human rights commissions have more expertise than tribunals, but rather express the Courts’ belief that commissionshave no expertise on questions of law. [41] While investigators and the Chief Commissioner may have some expertise on finding facts, they certainly do not haveexpertise when it comes to assessing credibility. (vi) The Circumstances Giving Rise to the Prior Administrative Proceedings [42] The administrative proceedings before the Human Rights Commission arose within a few months after the Plaintiff had beendismissed from her job and had been diagnosed with cancer.

Similar to Danyluk, supra, the Plaintiff invoked the Alberta Human RightsAct, supra, procedures at a time of personal vulnerability. (vii) The Potential Injustice [43] In Danyluk, supra at para. 80, Binnie J. held that the most important factor is whether the application of issue estoppel in theparticular case would work an injustice. In that case, the Supreme Court of Canada found that the employee’s claim for commissions hadnever been properly considered and adjudicated.

Similarly, in this case it is difficult to say that the Plaintiff’s complaint was properlyadjudicated by the Human Rights Commission when credibility is the primary issue and there is no sworn evidence or the opportunity to

cross-examine witnesses. [ 44 ] In conclusion, I find that I ought to exercise my discretion to refuse to apply issue estoppel.

Although weighing the factors together suggests that issue estoppel should not apply, my decision is primarily motivated by the fact that the issue of discrimination has never been properly tried because of the lack of sworn evidence and cross-examination when credibility is the main issue. [ 45 ] In addition, because the issue of discrimination has not been properly tried, allowing the Plaintiff to allege discrimination in her wrongful dismissal action does not otherwise result in an abuse of process. [ 46 ] The Defendant’s application is dismissed, together with costs to the Plaintiff on the appropriate column.

Heard on the 21 st day of July, 2011. Dated at the City of Edmonton, Alberta this 25 th day of October, 2011. W. Breitkreuz M.C.C.Q.B.A. Appearances: Paul R. Foisy Nickerson Roberts Holinski & Mercer for the Plaintiff (Respondent) Roderick C. Payne Hustwik Hodgson & Payne for the Defendant (Applicant)