Traders Finance Corporation v. Casselman

between the appellant and City Construction Company, Limited, I agree with Cartwright J. that the argument fails on the facts.

The appeal should be dismissed with costs.

The judgment of Taschereau and Locke JJ. was delivered Kerwin CJ. by

J.:-This is an appeal from a judgment of the Court of Appeal of British Columbia' which dismissed the appeal of the present appellant, the defendant in the action, from a judgment of Clyne J. By that judgment the respondent recovered general damages in the sum of $2,500, special damages for loss of profit for a named period, and was granted an injunction restraining the appellant from interfering with the plaintiff, his agents or servants or any of them, in the operation of his business by endeavouring to induce or coerce the plaintiff to join the defendant union or from negotiating or dealing with any person, firm or corporation in any way to induce or coerce the plaintiff to join the said union.

For some years prior to the month of September 1956 the respondent was the owner and operator of a contracting and trucking business in Vancouver and at the time in question owned a tractor and four trucks. He had for years supplied trucks to the City Construction Co. Ltd., a company carrying on its business in British Columbia, together with drivers employed by him, and a truck which he himself operated, these vehicles being used by the construction company in connection with their operations, in consideration of an agreed payment to the respondent. In this arrangement the position of the respondent was that of an independent contractor and the truck drivers employed by him acted as his servants and were paid by him. There was no written contract between the parties but the evidence shows that the services rendered were satisfactory to the construction company and would have been continued for an indefinite period of time but for the events complained of.

The appellant is a trade union, as that expression is defined in the Labour Relations Act, 1954 (B.C.), c. 17, s. 1. Local no. 213, the appellant in these proceedings, is an organization forming part of an international union which has its headquarters in the United States.

On September 28, 1955, the appellant had entered into an agreement as to wages and working conditions with the City Construction Co. Ltd. as the bargaining agent of the truck drivers employed by that company and which covered all construction work undertaken by it in the province. While no evidence was given upon the point, it appears to have been assumed throughout that the union had been certified as the bargaining agent of these employees under the provisions of the Labour Relations Act and was, accordingly, empowered to contract in writing on their behalf in regard to their working conditions, rates of pay and other matters commonly forming part of a collective agreement.

Clause 10 of this agreement read:

Clause 16, which dealt with what was described as grievance procedure, provided in part that, if during the term of the agreement any dispute should arise as to the carrying out of its terms or its interpretation, each party should appoint three persons to be members of a committee to examine the difficulty in an endeavour to find a solution. If this failed the clause provided that an arbitration board should be constituted and its decision should be final. The facts, as found by the learned trial judge, are as follows:-During the summer of 1956 one Carbonneau, a business agent of the union, called at the premises of the City Construction Co. Ltd. to make certain that the truck drivers employed belonged to the union. There he saw Therien and told him that he must join the union as well as the other drivers of his trucks. Therien, presumably having in mind the provisions of the Labour Relations Act, refused to join the union but agreed that he would employ union drivers for his other trucks and thereafter did so. Carbonneau admitted that in June 1956 he knew that Therien was himself an employer of labour: nevertheless, he told Therien that if he did not join the union they would "placard" the company and have his truck put off the job. Thereafter Carbonneau and another union representative had several conversations with the despatcher of the construction company and told him that if the company continued to use Therien's truck they would "placard" the various places where the company was doing work. Smith referred the matter to the general manager of the company, C. W. Bridge, and Carbonneau told the latter that Therien must not only employ the union drivers but must be a member of the union himself and that if Therien continued to drive a truck the company's job would be placarded. The learned trial judge found that by this term the union officials meant, and were understood to mean, that they would, by means of a picket line carrying placards, take such steps as would have the effect of interfering with and obstructing the operations of the company and of making it appear to the public and other labour unions that the company had broken its contract with the defendant union, or was indulging in unfair labour practices.

In consequence of these threats, Bridge wrote to the respondent informing him that the construction company would no longer be able to hire the truck driven by himself after that date. The letter read in part:

The respondent continued for a few days longer supplying trucks, including the one driven by himself, 'to the Construction Company, but on September 24, 1956, he was finally told that the company could no longer do business with him.

Subsection (1) of s. 4 of the Labour Relations Act reads in part:

Section 6 of the Act reads:

In Morrison v. Yellow Cab Co. Ltd.', Clyne J. had held that an employer in a position similar to that of the present respondent was precluded by subs. (1) of s. 4 from becoming a member of a trade-union in the province, a conclusion with which I respectfully agree. Notwithstanding the provisions of the section, the secretary-treasurer of the union said in evidence at the trial that, in spite of the fact that he was an employer, the union would accept him into its membership.

That damage to the respondent resulted from these actions cannot be disputed. By way of defence to the action the appellant says, firstly, that it is not a legal entity which may be found liable in tort, and secondly, that the evidence does not disclose a cause of action, either at common law or under the Industrial Conciliation and Arbitration Act. The first of these questions is not determined in the appellant's favour by the decision of this Court in Orchard v. Tunney . In that case the action was originally brought against Orchard and six other members of the Executive Committee of Local Union No. 119 of the International Brotherhood of Teamsters Union. By an interlocutory order made by the Court of Appeal after the judgment at the trial, a representation order was made and the style of cause amended to indicate that these individual defendants were sued on their own behalf and on behalf of all other members of the labour union except the plaintiff. The proceedings in the matter do not indicate whether the collective agreement signed by the union with Tunney's employers had been made after the union had been certified as the bargaining agent under the provisions of the Labour Relations Act, R.S.M. 1948, c. 27, and, as the action was not brought against the union, the question as to whether it not considered, either at the trial by Williams C.J. or in the Court of Appeal or argued in this Court. There was, accordingly, no issue in this Court as to the legal status of the labour union. Accordingly, what was said by Rand J. in delivering the judgment of the majority of the Court and by me in delivering the judgment of our late brother Nolan and myself, which really merely consisted in restating what had been said earlier in this Court by Duff J. (as he then was), Anglin J. (as he then was) and Brodeur J. in Local Union v. Williams', cannot be taken as deciding that in Manitoba a trade union certified as bargaining agent under the Manitoba Act (which closely resembles that of British Columbia) is not an entity which may be held liable in tort. A case is only authority for what it actually decides. The question as to whether a trade union certified as a bargaining agent by a statute in the terms of the Labour Relations Act of British Columbia may be made liable in an action, either in tort or contract, has not heretofore been considered by this Court.

In Taff Vale Railway v. Amalgamated Society of Railway Servants', the action was brought against a trade union registered under the Trade Union Acts of 1871 and 1876 for an injunction restraining the union, its servants and agents and others acting by their authority from watching or besetting the Great Western Railway Station at Cardiff. A motion made on behalf of the union before Farwell J. to strike out the name of that defendant on the ground that it was neither a corporation nor an individual and could not be sued in a quasi-corporate or any other capacity was dismissed.

It appears to me to be clear that, had it not been that the trade union was registered under the Trade Union Act, the action against it by name would not have been maintained. Provision was made by the Act of 1871 for the registration of trade unions and they were given power, inter alia, to purchase property in the names of trustees designated by them and to sell or let such property. The trustees of any registered union were empowered to bring or defend actions touching or concerning the property of OF the union and might be sued in any court of law or equity in respect of any real or personal property of the union. The union was also required to have a registered office and Locke J. to make annual returns to the Registrar appointed under the Act yearly, and any trade union failing to comply with the provisions of the Act and every officer of the union so failing was made liable to a penalty.

Farwell J. said that the fact that a trade union is neither a corporation nor an individual or a partnership between a number of individuals did not conclude the matter. After pointing out that the Acts legalized the usual trade union contracts, established a registry of trade unions giving to each an exclusive right to the name in which it was registered and authorized it through the medium of trustees to own a limited amount of real estate and unlimited personal estate, said in part (p. 429):

Now, although a corporation and an individual or individuals may be the only entity known to the common law who can sue or be sued, it is competent to the Legislature to give to an association of individuals which is neither a corporation nor a partnership nor an individual a capacity for owning property and acting by agents, and such capacity in the absence of express enactment to the contrary involves the necessary correlative of liability to the extent of such property for the acts and defaults of such agents. It is beside the mark to say of such an association that it is unknown to the common law. The Legislature has legalised it, and it must be dealt with by the Courts according to the intention of the Legislature. . . .

Now, the Legislature in giving a trade union the capacity to own property and the capacity to act by agents has, without incorporating it, given it two of the essential qualities of a corporation-essential, I mean, in respect of liability for tort, for a corporation can only act by its agents, and can only be made to pay by means of its property. The principle on which corporations have been held liable in respect of wrongs committed by its servants or agents in the course of their service and for the benefit of the employer-qui sentit commodum sentire debet et onus-(see Mersey Docks Trustees v. Gibbs (1886) L.R. 1 H.L. 93) is as applicable to the case of a trade union as to that of a corporation. . The proper rule of construction of statutes such as these is that in the absence of express contrary intention the Legislature intends that the creature of the statute shall have the same duties, and that its funds shall be subject to the same liabilities as the general law would impose on a private individual doing the same thing. It would require very clear and express words of enactment to induce me to hold that the Legislature had in fact legalised the existence of such irresponsible bodies with such wide capacity for evil.

The order dismissing the motion was set aside by the Court of Appeal but restored in the House of Lords. Haisbury L.C. said that he was content to adopt the judgment of Farwell J. with which he entirely concurred and added (p. 436):

Lord Macnaghten, Lord Shand and Lord Brampton were agreed in adopting the judgment of Farwell J. and the reasoning upon which it proceeded. Lord Lindley, after saying that he had no doubt that, if the trade union could not be sued in its registered name, some of its members could be sued on behalf of themselves and the other members of the society and an injunction and judgment for damages could be obtained in an action so framed, said that the question in the litigation was of comparatively small importance but that the Act appeared to indicate with sufficient clearness that the registered name is one which may be used to denote the union as an unincorporated society in legal proceedings as well as for business and other purposes, and that the use of the name imposed no duty and altered no rights but was only a more convenient mode of proceeding than that which would have to be adopted if the name could not be used.

It was, undoubtedly, as a result of the judgment in the Taff Vale case that the Trade Disputes Act of 1906 (c. 47) which amended the Trade Union Acts of 1871 and 1876 was passed. That Act did not alter the law as declared by the House of Lords as to registered trade unions being entities which might be held liable in tort, but declared the rights of persons on behalf of trade unions to carry on what has now become to be known as peaceful picketing, and further declared that an action against a trade union or any members or officials thereof on behalf of themselves and all other members of such union in respect of any tortious act alleged to have been committed by or on behalf of the union should not be entertained by any court.

It was clearly, I think, in consequence of the Taff Vale decision that the Legislature of British Columbia enacted the Trade Union Act of 1902 (c. 66). This Act declared that no trade union or the trustees of any such union shall be liable for damages for any wrongful act or omission or commission in connection with any strike, lock-out or trade or labour dispute, unless the members of such union or its council or other governing body shall have authorized, or shall have been a concurring party in such wrongful act: that no such trade union nor any of its servants or agents shall be enjoined, nor its funds or any of such officers be made liable for communicating to any person facts respecting employment or hiring or in persuading or endeavouring to persuade by fair or reasonable argument any workman or person to refuse to continue or become the employee or customer of any employer of labour. Section 3 of that Act further declared that no trade union or its agents or servants shall be liable in damages for publishing information with regard to a strike or lock-out or for warning workmen or other persons against seeking employment in the locality affected by any strike, lock-out or labour trouble or from purchasing, buying or consuming products produced by the employer of labour party to such strike.

It will be seen that the British Columbia Act, by its reference to trade unions as such, as well as to the servants and agents of such unions restricting their liability in tort to the extent defined, recognized the fact that a trade union was an entity which might be enjoined or become liable in damages for tort.

It may be said in passing that there was no such statute in force in the Province of Manitoba when the cause of action arose in Orchard's case. In Cotter v. Osborne', the action to restrain and recover damages for the acts of certain members of a trade union in the course of a trade dispute was brought against the individuals and a representation order made by Mathers J. As in Orchard's case the question as to whether the union might have been sued or enjoined by name was not raised.

By the Labour Relations Act, s. 2, a trade union as defined includes a local branch of an international organization such as the appellant in the present matter. Extensive rights are given to such trade unions and certain prohibitions declared which affect them. The Act treats a trade union as an entity and as such it is prohibited, inter alia, from attempting at the employer's place of employment during working hours to persuade an employee to join or not to join a trade union, from encouraging or engaging in any activity designed to restrict or limit production or services, from using coercion or intimidation of any kind that could reasonably have the effect of compelling any person to become or refrain to become a member of a trade union and from declaring or authorizing a strike until certain defined steps have been taken. By s. 7 if there is a complaint to the Labour Relations Board that a union is doing or has done any act prohibited by ss. 4, 5 or 6, the Board may order that the default be remedied and, if it continues, the union may be prosecuted for a breach of the Act. By s. 9 all employers are required to honour a written assignment of wages by their employees to a trade union. A union claiming to have as members in good standing a majority of employees in a unit appropriate for collective bargaining is entitled to apply to the Labour Relations Board for certification as the bargaining agent of such employees and, when certified, to require the employer to bargain with it and, if agreement is reached, to enter into a written agreement with it which is signed by the union in its own name as such bargaining agent. Throughout the Act such organizations are referred to as trade unions and thus treated as legal entities.

The question as to whether a trade union such as the present appellant is an entity which might be proceeded against by name in proceedings under the Industrial Conciliation and Arbitration Act, 1947, (c. 44) was considered by the Court of Appeal in In re Patterson and Nanaimo Dry Cleaning and Laundry Workers Union Local No. The provisions of that statute, which was repealed by the Labour Relations Act, in so far as they affect the present consideration, appear to me indistinguishable from the latter Act. Proceedings had been taken in the Police Court against the union named, for an alleged breach of the provisions of the Act in authorizing a strike of the employees before a conciliation board had been appointed to endeavour to bring about an agreement. It was only necessary in the case to determine whether a trade union, acting as a bargaining