Date: 20040209
Docket: A-120-03
Citation: 2004 FCA 59
CORAM: ROTHSTEIN J.A.
BETWEEN:
TELECOMMUNICATIONS WORKERS UNION
Appellant
and
TELUS MOBILITY and
DAVID WELLS
Respondents
Heard at Vancouver, British Columbia on January 29, 2004.
Judgment delivered at Ottawa, Ontario on February 9, 2004.
REASONS FOR JUDGMENT BY: SHARLOW J.A.
CONCURRED IN BY: ROTHSTEIN J.A.
MALONE J.A.
Date: 20040209
Docket: A-120-03
Citation: 2004 FCA 59
CORAM: ROTHSTEIN J.A.
BETWEEN:
TELECOMMUNICATIONS WORKERS UNION
Appellant
and
TELUS MOBILITY and
DAVID WELLS
Respondents
REASONS FOR JUDGMENT
[1] A dispute has arisen between the Telecommunications Workers Union (TWU) and Telus Mobility (Telus) because of certain changes made by Telus to the process by which the wireless communication accounts of Telus customers are activated or altered through independent dealers. TWU obtained an arbitration award relating to the impugned process. That award is registered in the Federal Court and so has the status of a court order.
[2] TWU believes that Telus has failed to comply with the order and is in contempt of court, and that Mr. David Wells, the Executive Vice President of Employee Services for Telus, as the person primarily responsible for ensuring compliance with such orders, is also in contempt of court.
[3] Contempt proceedings initiated by TWU against Telus were dismissed by a judgment of the Federal Court on December 6, 2002: Telus Mobility v. Telecommunications Workers Union, [2002] F.C.J. No. 1744 (QL), (2002) 226 F.T.R. 133. TWU now appeals that judgment.
[4] The principles relating to contempt of court are well established and are not in dispute. Contempt proceedings are criminal or quasi-criminal in nature and attract the procedural protections relating to criminal offences. The applicable standard of proof is proof beyond a reasonable doubt. The onus of proof is on the applicant. A finding of contempt of court cannot be based on a court order that is ambiguous, or an order that is merely declaratory. It must be clear on the face of the order what is required for compliance. There are numerous examples in which contempt proceedings have failed because the order lacked clarity or precision: see, for example, United Steelworkers of America, Local 663 v. Anaconda Co. (Canada) Ltd. (1969), 3 D.L.R. (3d) 577 (B.C.S.C.), C.U.P.W. v. Canada Post Corporation, [1987] F.C.J. No. 1021, (1987) 16 F.T.R. 4 (T.D.).
[5] Justice Rouleau explained the facts and arguments in considerable detail. His conclusions are summarized in paragraphs 48, 49 and 50 of his reasons (Appeal Book, Volume 1, pages 51 - 2):
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[para48] Telus Mobility intended to comply with the Arbitrator's order and in good faith spent considerable time, care and money to remedy the breach. Its rationale in the interpretation of the order was reasonable. To say the least, the Arbitrator's order could give rise to ambiguity and as a result, this gives rise to a reasonable doubt which should be resolved in favour of the company and Mr. Wells. |
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[para49] Proof beyond a reasonable doubt must be established to sustain an order for contempt. That order is quasi-criminal in nature and should only be granted in the clearest of circumstances. Having carefully reviewed the wording of the Arbitrator's order, I can only conclude, based on the evidence, that the Union has failed to overcome its onus to enjoin Telus Mobility and David Wells for contempt. The application is therefore dismissed. |
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[para50] The Court has absolute discretion in the awarding of costs. Because of the surrounding circumstances as well as the diverse interpretations that one could attribute to the Arbitrator's order, I have determined that there should be no award as to costs. |
[6] TWU appeals the dismissal of its application. Telus cross-appeals on the issue of costs. There is no cross-appeal by Mr. Wells.
The TWU appeal
[7] The essential dispute in this appeal is the meaning of the order that is the foundation for the contempt charge asserted by TWU. The position of TWU is that Justice Rouleau did not correctly understand the order. Telus argues that he did understand it. To fully appreciate their arguments, it is necessary to know the circumstances that led to the order being made.
[8] There are two agreements between TWU and Telus (including its predecessor BC TEL Mobility) that play a role in this matter. One is in the form of a letter dated December 4, 1992, and is referred to by the parties as the "Letter of Agreement". It reads as follows:
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LETTER OF AGREEMENT WRITING UP OF BC TEL MOBILITY CELLULAR SERVICE ORDERS |
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The Company and the Union agree that BC TEL Mobility Cellular agents or dealers do not have the ability to access BC TEL Mobility Cellular computer systems (e.g. billing records, activation and/or other customer records). The systems are to remain completely under the control of BC TEL Mobility Cellular and operated only by their employees. |
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The Company agrees to discuss any change taking place. The discussion will be brought to the TWU members of the Joint Standing committee on Contracting Out and Technological Change. |
[9] The other agreement is a collective agreement between Telus and TWU, which among other things prohibits Telus from contracting out work without the approval of the Joint Standing Committee on Contracting Out and Technological Change (the same committee that is referred to in the Letter of Agreement).
[10] Complaints relating to the failure of a party to refer a matter to the Joint Standing Committee on Contracting Out and Technological Change in breach of either agreement is dealt with by arbitration, with the Chair of the Committee acting as arbitrator. The history of this case discloses two such arbitrations, one in 1998 before Mr. Paul Fraser, Q.C., and the other in 2001 before Mr. Stephen Kelleher, Q.C., as he then was.
[11] Prior to 1998, wireless accounts with Telus could be activated or altered through an independent dealer, but only with the participation of Telus employees called "Activations Representatives", who are members of the bargaining unit represented by TWU. The customer information would be sent to Telus by telephone or fax. Activations Representatives would input the information to the Telus computer systems for switching, billing, customer credit checks and recording the serial numbers of customer owned wireless handsets. The process was made more automated in the mid-1990s by the introduction of a new billing system called "FAST".
[12] In 1998, Telus introduced a system called "Electronic Transfer of Contract" (ETOC), which was used by independent dealers with Internet access. Under that system, the dealer would input the customer information into a computer, and the information would be transmitted by the Internet to Telus, where it was held in a buffer. The Activations Representatives would access the information and take the steps required to ensure that the customer information was sent to the various Telus computer systems. The amount of work required of Activations Representatives under ETOC was considerably less than before, because the inputting work previously done by the Activations Representatives was done by the independent dealers. Telus did not involve the Committee in the introduction of ETOC.
[13] TWU objected to the introduction of ETOC on the basis that it breached the contracting out provisions of the collective agreement. That dispute was arbitrated by Mr. Fraser, who rendered a decision dated May 20, 1998 in favour of Telus. His decision reads in part as follows (Appeal Book, Volume 1, pages 17-18):
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The Union seeks to make a crucial distinction between the former process where the information from the dealer came by paper fax and was typed into the database by the activations representatives and the present system where the information is transferred to the buffer and electronically retrieved by the activations representative. In my view, this is a distinction without any important difference. The essential nature of the work remains the same. The only thing that has changed is that the processing of the information happens much more efficiently and, I assume, more quickly. The activations representative doesn't have to manually retrieve fax information on a random basis. The representative need only access the buffer which has the information stored and cued. |
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The Company is entitled under the Collective Agreement, as I read it, to take advantage of any new equipment it can acquire to shorten the processing of information, providing that the work necessary to do so continues to be done by the Bargaining Unit, in circumstances where activation representatives have regularly been doing the work as part of a process that has been extant since 1985. While the retrieval process has changed under the new ETOC system, the fact remains that the activation representatives continue to do the retrieval work. There has, therefore, been no contracting out by the Company of the ultimate processing of electronic data transmitted by its mobility dealers to the Customer Activation Centre. |
[14] In the 1998 arbitration, TWU did not argue that there had been a breach of the Letter of Agreement. The record does not disclose why no such argument was made at that time.
[15] In June of 2001, Telus introduced two new procedures for the activation and alteration of wireless accounts through independent dealers. The new procedures were called Remote Dealer Activation (RDA) and Interactive Voice Response (IVR). Again, Telus did not involve the Committee.
[16] Under RDA, as under ETOC, an independent dealer wishing to activate a new wireless account would input the customer information into a computer and transmit the information to Telus by the Internet. However, the information would not be held in a buffer. Rather, the information would be entered automatically into the Telus computer systems. The effect was that a new wireless account could be activated by a independent dealer with no participation by an Activations Representative.
[17] IVR is a similar system that permits alterations to an existing account. Under IVR, a independent dealer uses a touch tone telephone to alter an existing account without the participation of an Activations Representative.
[18] Under both RDA and IVR, the participation of an Activations Representative would be required if, but only if, the customer was a corporation rather than an individual, or if there was a problem with the attempted activation or the attempted account alteration. In most cases, no such problems would be encountered.
[19] TWU protested the introduction of RDA and IVR on the basis that it breached the contracting out provisions of the collective agreement, and that it also breached the Letter of Agreement. Mr. Kelleher, in a decision dated June 26, 2001, found that there had been no contracting out, but there had been a breach of the Letter of Agreement. He ordered further meetings to be held to work out a resolution.
[20] It is useful to review Mr. Kelleher's June 26, 2001 decision in some detail, because both parties have relied on different portions of his analysis and his conclusion, as set out in Part III and Part IV of the decision. Those two parts are reproduced in full below (Appeal Book, Volume 1, pages 7 to 10):
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III The Company's position is that there has been no contracting out. RDA has simply replaced FAST. Software is now doing what Activation Representatives have been doing to date. |
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The Union argues that these events must be considered in context. When ETOC was introduced, dealers began entering data. This data ended up going to the Company's various databases: switch, billing and so on. It is clear from Mr. Fraser's ETOC decision [the 1998 arbitration] that it was significant that the Activation Representatives were still doing the work. All that had changed was that the clerk who was retrieving the data from the buffer no longer had to type it again. As Mr. Fraser put it: |
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...The Activation Representatives continue to do the retrieval work. There has, therefore, been no contracting out by the Company of the ultimate processing of electronic data transmitted by its Mobility Dealers to the Customer Activation Centre. |
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Of course with the introduction of RDA, Activation Representatives no longer do the retrieval work. In a simple personal order with no complications, the Activations Representative is no longer involved. The work of entering data into the Company's systems is really done by the dealer. The work of the Activations Representative in that regard has been reduced to retrieval (by the introduction of ETOC) and now eliminated by RDA, except for the many activations that have complications. |
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The change introduced in June, 2001 [i.e., the introduction of RDA and IVR], means, in effect, that the dealers are inputting data into Company databases. |
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I turn to the letter of December 4, 1992. The first paragraph has two sentences: |
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· The Company and the Union agree that BC TEL Mobility Cellular agents or dealers do not have the ability to access BC TEL Mobility Cellular computer systems (e.g. billing records, activation and/or other customer records). |
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· The systems are to remain completely under the control of BC TEL Mobility Cellular and operated only by their employees. |
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The first sentence can be read in two ways. The Union argues that dealers are "accessing" TELUS Mobility computer systems in the sense that they are inputting information directly, without any bargaining union employee. That is a plausible argument. The Company's position is that dealers are not accessing the computer system. They are not obtaining information from them. That is plausible as well. It is consistent with the American Heritage Dictionary definition of access: "to retrieve from a computer's storage files". The Canadian Oxford Dictionary includes this definition of access: "the action or process of obtaining stored documents, data, etc.". |
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In my view, however, the second sentence lacks ambiguity. With the advent of RDA and Dealer IVR, the computer systems are no longer "... completely under the control of [TELUS Mobility] and operated only by [TELUS Mobility] employees. |
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There is no suggestion that this letter does not bind the Company. The Company should have brought the matter to "the TWU members" of the committee as the second paragraph of the letter contemplates. |
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IV I have concluded that the Company's introduction of RDA without prior discussion is inconsistent with the December 4, 1992, letter. |
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Is it contracting out? In my view the contracting out occurred when dealers were first engaged to provide a retail outlet for TELUS Mobility products. Part of that engagement was that the Dealer would provide all pertinent information to the Company. The Dealer is now doing, in substance, no more than that. The change is the gradual introduction of technology to the point that there is now activation without the intervention of an Activation Representative. |
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The question which must now be addressed is the consequences of the conclusion that the introduction of RDA is inconsistent with the Letter of Agreement of December 4, 1992. |
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I am prepared to hear submissions on this matter and to discuss whether an appropriate resolution can be found. |
[21] After this decision was rendered, Telus challenged the jurisdiction of Mr. Kelleher to grant a remedy. In a decision dated September 17, 2001, Mr. Kelleher rejected the jurisdictional objection raised by Telus. Telus applied to the Supreme Court of British Columbia for judicial review of Mr. Kelleher's September 17, 2001 decision. The application was dismissed on May 21, 2002 by Justice Paris: Tele-Mobile, Inc. v. Telecommunications Workers Union, 2002 BCSC 776.
[22] While the judicial review application was pending, Mr. Kelleher conducted hearings on the question of remedy. His decision was rendered on January 30, 2002. The concluding paragraphs of that decision read as follows (Appeal Book, Volume I, pages 22-23):
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The Union seeks an order directing the Company to cease violating the Letter of Agreement. As well, it reserves the right to claim damages arising from the Company's introduction of RDS [sic] (including IVR) without the prior authorization of the Committee. |
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The Company's position on remedy is that there is nothing to remedy. Because of the reorganization the bargaining unit in British Columbia has not been affected. |
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Moreover, the Company says, if the Company were not permitted to use RDA, it would be forced to use old technology and to use employees unnecessarily. This amounts to featherbedding. |
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I have already made a final and binding decision. The Company is in violation of the Letter of Agreement. The parties have had an opportunity to find some accommodation or agreement on the issue but have not done so. I therefore direct that the violation come to an end; that RDA and IVR not be used in such a way that excludes bargaining unit employees. I direct that TELUS Mobility computer system remain completely under the control of TELUS Mobility and operated only by TELUS Mobility employees. |
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In my decision of September 17, 2001, I stated that "I may be limited by the scope of the British Columbia Collective Agreement". I have considered this and conclude that I am so limited. This order therefore applies only to activation at dealers in the Province of British Columbia. |
[23] On February 8, 2002, Mr. Kelleher made the following order:
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The Employer is in violation of the Letter of Agreement between the Union and the Employer dated December 4, 1992. I direct that the violation of the Letter of Agreement dated December 4, 1992 by the Employer come to an end; that Remote Dealer Activation (RDA) and Interactive Voice Response (IVR) not be used in such a way that excludes bargaining unit employees; and that TELUS Mobility computer system remain completely under control of TELUS Mobility and operated only by TELUS Mobility employees. |
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The Order applies only to dealers in the Province of British Columbia. |
[24] The February 8, 2002 order of Mr. Kelleher was filed with the Federal Court and registered on March 11, 2002 pursuant to section 66 of the Canada Labour Code, R.S.C. 1985, c. L-2. That made the award enforceable as an order of the Federal Court. Section 66 of the Canada Labour Code reads as follows:
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66. (1) Any person or organization affected by any order or decision of an arbitrator or arbitration board may, after fourteen days from the date on which the order or decision is made or given, or from the date provided in it for compliance, whichever is the later date, file in the Federal Court a copy of the order or decision, exclusive of the reasons therefor. |
66. (1) La personne ou l'organisation touchée par l'ordonnance ou la décision de l'arbitre ou du conseil d'arbitrage peut, après un délai de quatorze jours suivant la date de l'ordonnance ou de la décision ou après la date d'exécution qui y est fixée, si celle-ci est postérieure, déposer à la Cour fédérale une copie du dispositif de l'ordonnance ou de la décision. |
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(2) On filing an order or decision of an arbitrator or arbitration board in the Federal Court under subsection (1), the order or decision shall be registered in the Court and, when registered, has the same force and effect, and all proceedings may be taken thereon, as if the order or decision were a judgment obtained in the Court. |
(2) L'ordonnance ou la décision d'un arbitre ou d'un conseil d'arbitrage déposée aux termes du paragraphe (1) est enregistrée à la Cour fédérale; l'enregistrement lui confère la valeur des autres jugements de ce tribunal et ouvre droit aux mêmes procédures ultérieures que ceux-ci. |
[25] In early February, 2002, Telus began working on a technological response to Mr. Kelleher's order. The solution bears the name "Apollo 2.0" and works as follows. The independent dealers input customer information into a computer, and the information is transmitted to Telus. However, the information does not automatically enter the Telus computer systems. Rather, the information is kept in a buffer, as it was under ETOC prior to June, 2001. A message then appears on the computer screen of an Activations Representative indicating that an independent dealer wishes to have a wireless account activated or altered. The message identifies the independent dealer, but contains no particulars about the customer or the account. The task of the Activations Representative upon receiving this message is to make a single mouse click, which causes the information provided by the independent dealer to move electronically into the Telus computer systems. It is not permissible for an Activations Representative to decline to make the mouse click when the independent dealer message is received. The task assigned to Activations Representatives has no function except to give them a task, as nominal as can be, without which a wireless account cannot be activated or altered. Apollo 2.0 was in place by July 1, 2002.
[26] The position of Telus is that the single mouse click required of Activations Representatives under Apollo 2.0 remedies the failure of Telus to comply with the Letter of Agreement, because the RDA and IVR systems are no longer being used in such a way that excludes the Activations Representatives. The position of TWU is that Telus has not remedied its breach of the Letter of Agreement, and that as a result Telus remains in breach of the March 11, 2002 court order and is in contempt of court.
[27] On May 24, 2002, immediately after the jurisdictional challenge by Telus was rejected by the Supreme Court of British Columbia, TWU commenced contempt proceedings. A show cause order was issued on June 10, 2002 against Telus and Mr. Wells. Justice Rouleau heard the matter in November, 2002 and rendered judgment on December 6, 2002 dismissing TWU's application. TWU appeals that judgment.
[28] TWU and Telus do not agree on the meaning of the order, or on what Telus is required to do to comply with it. Its key provisions are reproduced here for ease of reference:
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I direct that the violation of the Letter of Agreement dated December 4, 1992 by the Employer come to an end; that Remote Dealer Activation (RDA) and Interactive Voice Response (IVR) not be used in such a way that excludes bargaining unit employees; that TELUS Mobility computer system remain completely under control of TELUS Mobility and operated only by TELUS Mobility employees. |
[29] TWU's understanding of the order is based on the premise that it mandates what TWU has called a "standard of exclusivity". That is the phrase used by TWU to convey the notion that, by virtue of the requirement that "TELUS Mobility computer system remain completely under control of TELUS Mobility and operated only by TELUS Mobility employees", there cannot be compliance with the order if the customer information that is required to activate or alter a wireless account is input by independent dealers directly into the Telus computer system without the need for any work on the part of Activations Representatives. TWU argues that in a substantive sense, the work of Activations Representatives was reduced to nothing in June of 2001 when RDA and IVR were introduced, and the situation has not been cured by the single mouse click required of Activations Representatives as of July 1, 2002.
[30] Telus does not dispute that the Letter of Agreement, as interpreted by Mr. Kelleher, requires that Activations Representatives are required to have some participation in the process of inputting information to the Telus computer systems to activate or alter wireless accounts. However, Telus argues that the quality of that participation is not specified in the order, and therefore they cannot be held to have breached the order, or to be in contempt of court, merely because they have implemented a process whereby the participation of the Activations Representatives is nominal.
[31] After reviewing the order and the various decisions of Mr. Kelleher, I am unable to agree with TWU that the order mandates a "standard of exclusivity", as TWU has defined that phrase. To accept that conclusion, it is necessary to accept the proposition that an independent dealer who inputs customer information into a computer and transmits it by the Internet to the Telus buffer, where it must remain until an Activations Representative performs a mouse click, is thereby exercising control over the Telus computer system, or operating it. That proposition is not stated in the order. Nor is it necessarily implied.
[32] Mr. Kelleher's decisions deal with the situation after June 2001 when, under RDA and IVR, independent dealers began to input information directly into the Telus computer systems. He found that all of the work of the Activations Representatives had been eliminated in most normal situations. He concluded that the elimination of the work of Activations Representatives was not contracting out, and that Telus was not in breach of the first substantive element of the Letter of Agreement ("... that ... dealers do not have the ability to access BC TEL Mobility Cellular computer systems ..."). He noted that the "access" provision is ambiguous, and might not refer to the mere inputting of information into a computer system.
[33] However, Mr. Kelleher found that Telus had breached the second substantive element of the Letter of Agreement ("the systems are to remain completely under the control of BC TEL Mobility Cellular and operated only by their employees"). He does not elaborate on that finding. However, it is axiomatic that the breach must consist of moving some aspect of the control or the operation of the Telus computer system to the independent dealers. The only thing that changed in June 2001 when RDA and IVR were introduced was that in most cases, the Activations Representatives were excluded entirely from the process of inputting into the Telus computer systems the information required to activate or alter a wireless account. It is therefore reasonable to conclude, as Telus has done, that it was the complete exclusion of Activations Representatives from that process that constituted the failure of Telus to ensure that its computer systems are completely under its control and are operated by Telus employees only.
[34] That conclusion is supported by a number of factual statements made by Mr. Kelleher about how the work of Activations Representatives changed in June, 2001 when RDA and IVR were introduced, including the following statements from the June 26, 2001 decision (Appeal Book, Volume 1, pages 7 and 8):
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... Of course with the introduction of RDA, Activation Representatives no longer do the retrieval work. In a simple personal order with no complications, the Activation Representative is no longer involved. The work of entering data into the Company's systems is really done by the dealer. The work of the Activations Representative in that regard has been reduced to retrieval (by the introduction of ETOC) and now eliminated by RDA, except for the many activations that have complications. |
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The change introduced in June, 2001, means, in effect, that the dealers are inputting data into the Company databases. |
[35] See also this statement from the September 17, 2001 decision (Appeal Book, Volume I, page 12):
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RDA permits TELUS Mobility dealers to activate a mobile telephone without involvement of the bargaining unit. I decided the introduction of RDA is inconsistent with a Letter of Agreement dated December 4, 1992. |
[36] Nor can I find anything in the order, or in any of the decisions of Mr. Kelleher, requiring any particular degree or quality of participation by Activations Representatives in the process of activating or altering wireless accounts. A single mouse click is not very much work. It does not require much skill, or any discretion. It is difficult to conceive of a smaller degree of participation in a process. However, there is simply nothing in the order that provides a basis for concluding that more than a single mouse click is required to cure the breach of the Letter of Agreement.
[37] The inescapable conclusion is that Telus is not in breach of the order, and thus cannot be held to be in contempt of court. That being the case, there can be no finding of contempt of court by Mr. Wells.
Cross-appeal by Telus on costs
[38] Justice Rouleau made no award of costs "[b]ecause of the surrounding circumstances as well as the diverse interpretations that one could attribute to the Arbitrator's order" (paragraph 50 of his reasons, Appeal Book, Volume 1, page 52). Telus argues that neither the "surrounding circumstances" nor the ambiguity in the order can justify denying the normal award of costs to it as the successful party.
[39] An award of costs is discretionary and will not be disturbed on appeal unless it is based on an error of law or a failure to consider relevant considerations. The factors that may be taken into account are numerous, and include any matter the judge considers relevant: Federal Court Rules, 1998, SOR/98-106, subsection 400(2). Having reviewed the record and considered the arguments of Telus, I am not persuaded that there is any basis for interfering with the award of costs in this case.
Conclusion
[40] The appeal and cross-appeal should be dismissed with costs.
"K. Sharlow"
J.A.
"I agree
Marshall Rothstein J.A."
"I agree
B. Malone J.A."
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-120-03
STYLE OF CAUSE: TELECOMMUNICATIONS WORKERS UNION
v.
TELUS MOBILITY and DAVID WELLS
PLACE OF HEARING: Vancouver, B.C.
DATE OF HEARING: January 29, 2004
REASONS FOR JUDGMENT
BY: SHARLOW J.A.
CONCURRED IN BY: ROTHSTEIN J.A.
MALONE J.A.
DATE: February 9, 2004
APPEARANCES:
MORLEY D. SHORTT for APPELLANT
ISRAEL CHAFETZ for RESPONDENT
ROY C. FILION for RESPONDENT
SOLICITORS OF RECORD:
Shortt, Moore & Arsenault for APPELLANT
Taylor, Jordan & Chafetz for RESPONDENT
Filion Wakely Thorup Angeletti LLP for RESPONDENT