Maruniak v. Teamsters National Benefit Plan Date:, 2015 BCPC 44

Citation: Maruniak v. Teamsters National Benefit Plan Date: 20150212 2015 BCPC 0044 File No: C14956 Registry: Port Coquitlam IN THE PROVINCIAL COURT OF BRITISH COLUMBIA BETWEEN: JOZEF MARUNIAK CLAIMANT AND: TEAMSTERS NATIONAL BENEFIT PLAN AND THE GREAT WEST LIFE ASSURANCE COMPANY DEFENDANT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE P. L. JANZEN Appearing on their own behalf: J. Maruniak Counsel for the Defendant: Ian D. Mackie Place of Hearing: Port Coquitlam , B.C. Date of Hearing: November 24, 2014 Date of Judgment: February 16, 2015 Introduction [ 1 ] The Claimant claims against the Defendant, Teamsters National Benefit Plan (the “Plan”) for the denial of his claim for long

term disability benefits. The Plan has applied under Rule 16(6)(

o) of the Small Claims Rules to dismiss the claim on the basis that this court has no jurisdiction to consider it because the dispute arises out of the collective agreement that governed the Claimant’s employment. Background to the Dispute [ 2 ] The Claimant was employed under a collective agreement between his employer, Gulf Islands Cartage Co. Ltd. (the “Employer”) and the union that represented him, Teamsters Local Union No. 31 (the “Union”). The collective agreement provided long term disability benefit coverage to the Claimant.

The Claimant successfully applied for disability benefits under the Plan in December, 2010. In September, 2012 he was disentitled from receiving benefits by the Trustees of the Plan. He brings this claim against the Plan. Relevant Provisions of the Collective Agreement

Article 22.01-22.03 of the collective agreement in effect between August 1, 2009 and July 31, 2011 states: 22.01 Health and Welfare The Teamsters - Transport Health and Welfare Trust Plan (the Health and Welfare Plan) covering members of the Union as set out in Appendix “B” hereunto annexed and forming part of this Agreement shall continue. The Company agrees to cover all members of the Union in the Health and Welfare Plan and to abide by the terms and conditions of the Teamsters-Transport Health and Welfare Trust Plan and as set out in Appendix “B” hereunder annexed and forming part of this Agreement 22.02 Payment of Dues and Contributions (

a) The Company agrees to make remittances to the Union for Union dues, the administrator of the health and welfare Plan, to which the Company is required to make contributions under this Agreement in accordance with the appropriate

article or appendix to this Agreement (

b) The Company agrees to hold in trust, until remitted, all amounts payable in respect of Union dues, the health and welfare plan, which the Company is obliged to make contributions pursuant to this Agreement and shall be liable, as such, for failure to remit for any reason including, but not limited to liquidation, assignment or bankruptcy of the Company. 22.03 Trust Agreement The Company agrees that it shall be bound by the terms and conditions of the Agreement and Declaration of Trust (the Trust Agreement) covering the health and welfare plan, to which the Company is required to make contributions pursuant to this Agreement. [ 3 ] Sections 1, 2 and 3 of Appendix B of the collective agreement states:

Section 1 - Participation It is agreed that the Company will participate in the Teamsters - Transport Health and Welfare Trust Plan (the Plan) instituted 1 July, 1971, and operated under an Agreement and Declaration of Trust revised on 26 November, 1990. The Company’s participation in the Plan will continue throughout the life of this Agreement.

Section 2 - Board of Trustees A Board of Trustees will be constituted of those persons provided for in the Agreement and Declaration of Trust (the Trust Agreement) and will include no less than three (3) people appointed by the Teamsters Local Union No.

Section 3 - Plan Administration The terms of the Plan and its administration shall be entirely the responsibility of the Board of Trustees, provided the Plan is administered in accordance with the Collective Agreement and any applicable government law or regulation.

The Plan and the activities of the Board of Trustees will be governed by an Agreement and Declaration of Trust, and benefit entitlement will be subject to such rules, limitations and exceptions contained in Plan documents and insurance contracts as are established and accepted by the Trustees from time to time. [ 4 ] The collective agreement expressly provides that the Plan forms part of the collective agreement. While the terms of the plan and its administration are the responsibility of the Trustees, the Plan must be administered in accordance with the collective agreement.

The collective agreement also provides that all employees covered under the collective agreement must join the Plan. [ 5 ] Under

Article 19 of the collective agreement, any dispute arising from the collective agreement is to be resolved using the grievance procedure in the collective agreement. Relevant Provisions of the Plan [ 6 ] Long term disability benefits coverage is described in

section 6 of the Plan. Entitlement to benefits is determined by the Trustees of the Plan. [ 7 ]

Section 6.4 of the Plan provides that “where a Member feels that a Long Term Disability Benefit has been paid or denied incorrectly the Member shall have the right to present a request for appeal to the Trustees.”

[8]

Section 2 of the Plan describes the Plan’s Appeal Procedures. The Trustees’ decision can either be reviewed by the Trustees orthe Trustees can refer the appeal to a claims review committee selected by the Trustees and comprised of at least two Trustees. Theappeal is brought by the Member, not the Union, and the Member may be represented or assisted by a union representative. [9]

Section 2.12.7 of the Plan provides that “All decisions made by the Trustees with respect to the determination of a Member’s entitlement to Benefits are final and binding on allparties involved in accordance with

Article VI of the Plan’s Agreement and Declaration of Trust.” Relevant Provisions of the Plan’s Agreement and Declaration of Trust (“The Trust Agreement”) [10] The Trustees of the Plan are appointed by the Union with one Trustee appointed by Building Material, Construction and FuelTruck Drivers Union, Local 213. [11] The Trust Agreement that created and established the Plan states in

Article 6.01 that the Trustees have the power and duty to “(

b) make determinations which shall be final and binding upon the Union and any Member or Employer affected, as to the rights of anyMember to benefits and to establish rules and procedures for the conduct of a hearing with respect to any such determination. TheTrustees may decide in their sole discretion, whether to conduct a hearing in any particular case, where they are called upon to make adetermination as to the rights of any Member” and “(

f) to interpret and construe the Plan and to determine all matters or questions relating to the Plan and in particular…all questions of …entitlement to benefits”. Does This Court Have Jurisdiction to Consider this Claim? [12] The Plan submits that the courts, including this court, have no jurisdiction to consider this claim as it must be pursued under thegrievance and arbitration provisions of the collective agreement and the review provisions of the BC Labour Relations Code (“theCode”).

That is because the collective agreement has expressly incorporated all of the terms of the Plan into the collective agreementand so a dispute about an employee’s entitlement to benefits necessarily arises from the provisions of the collective agreement. [13] The Supreme Court of Canada had occasion to consider the court’s jurisdiction in the seminal case of Weber v. Ontario Hydro, (SCC), 1995 2 SCR 929.

It concluded that the critical issues to be considered in determining whether a dispute fallswithin the exclusive jurisdiction of an arbitrator and the statutory labour relations regime are the “essential character” of the dispute andthe ambit of the collective agreement. [14] That case relied on the earlier decision of the Supreme Court of Canada in St. Anne Nackawic Pulp and Paper Co., (SCC), 1986, 1 SCR 704 in deciding that mandatory arbitration provisions in labour statutes deprived the courts of concurrentjurisdiction. [15] The Court quoted as follows from St.

Anne Nackawic: the law has so evolved that it is appropriate to hold that the grievance and arbitration procedures provided for by the Act and embodiedby legislative prescription in the terms of a collective agreement provide the exclusive recourse open to parties to the collectiveagreement for its enforcement. [16] The Plan relies on s. 84 of the Code that requires every collective agreement to contain a provision for the final and conclusivesettlement by arbitration or another method agreed to by the parties of all disputes between the persons bound by the agreement.

ThePlan is expressly included as a term of the collective agreement. The Claimant’s right to long term disability benefits clearly arises fromthe provisions of the collective agreement. [17] Under s. 95 of the Code, the decision of an arbitration board is binding on the parties. [18] Section 99(1) of the Code provides that the Labour Relations Board has exclusive jurisdiction over appeals of the decisions ofarbitration boards with the limited exception of an appeal to the BC Court of Appeal if the appeal of the decision or award is a matter ofgeneral law. [19]

Section 101 of the Code provides that except for the appeals described above, the award of an arbitration board is not open toquestion or review in a court on any grounds whatsoever. [20] The Claimant gave three reasons for his decision to proceed in this forum. First, his union representative advised him that hisclaim should be pursued in court against the Plan, not through the grievance procedure. Secondly, he had received this legal advice.

And thirdly, his employer had shut down in 2011. [21] Counsel for the Plan indicated that although the operation in which the Claimant was employed had shut down, the Companycontinued to exist. He filed the 2014 annual report for the Company as proof of its continuing existence. [22] I note that the Employer’s only obligation under the collective agreement and the Plan with respect to a claim for long termdisability benefits was to make financial contributions to the Plan.

All decisions respecting the administration of the Plan including thedecision to deny the Claimant’s claim were made by the Trustees of the Plan. The Employer does not appoint the Trustees and has nocontrol over their decisions. Counsel for the Plan acknowledged that this situation was unusual but that this was the bargain that theEmployer and Union had made in this case.

[23] I expressed concern that the Plan and the Trustees of the Plan were not parties to the collective agreement. Counsel for the Planassured the court and the Claimant that the Plan and the Trustees of the Plan would attorn to the jurisdiction of the grievance andarbitration processes under the collective agreement and the review and appeal processes of the Code and would participate fully in allproceedings, provided that the Union brought a grievance on behalf of the Claimant against the Employer. [24] I also note that in the case of Paller v.

Great West Live Assurance Company, 2003 BCSC 582 the court refers to paragraphs 41and 42 of the case of LeMoine v.

Great West Life Assurance Company (2002)2002 BCSC 520 , 100 B.C.L.R. (3d) 343 wherethe court held that a person not party to a collective agreement may still be subject to the arbitral process under that agreement where theessential character of the dispute arises under the agreement and the agreement provides a specific remedy for that dispute. [25] The Claimant as an employee of the Employer and member of the Union and of the Plan has no independent right to file agrievance, refer the grievance to arbitration or apply for the review of an arbitration award at the Labour Relations Board.

The Union asexclusive bargaining agent for all members of the bargaining unit determines whether to file a grievance on behalf of the employee andhow far to proceed with it. The Union may choose not to take any or certain steps to advance the Claimant’s interests.

In that case, theClaimant’s redress lies against the Union under s. 12 of the Code for a breach of the Union’s duty of fair representation. [26] While some of the specific provisions of this collective agreement, the Plan and the Trust Agreement and the roles of therespective parties are unusual, it is clear that the Claimant’s claim to the continuation of long term disability benefits arises from theprovisions of the collective agreement. It is also clear that the collective agreement that incorporated the Plan by reference stipulateshow decisions respecting entitlement to benefits are to be made.

As a result, I conclude that the claim must be pursued using the disputeresolution provisions of the collective agreement and the Code. Further, the Plan and its Trustees have expressly agreed to attorn to thejurisdiction of the processes under the collective agreement and the Code with the proviso described. [27] The application of the Plan for dismissal of the claim against it succeeds because this Court does not have the jurisdiction toconsider the Claimant’s claim.