Justice Q.B.G. A.D. 1998 No. 47 J.C.R. IN THE QUEEN'S BENCH JUDICIAL CENTRE OF REGINA IN THE MATTER OF THE LABOUR STANDARDS ACT, R.S.S. 1978, c. L-1 APPEAL BETWEEN: LILLIAN KOVACH RESPONDENT (COMPLAINANT) and CAJON INVESTMENTS INC. APPELLANT (RESPONDENT) M. Brass for the respondent M. Griffin for the appellant JUDGMENT KLEBUC J. March 23, 1998 [1] The appellant ("Cajon") seeks an order quashing thedecision of an adjudicator made following a hearing pursuantto s. 62.1 and 62.2 of The Labour Standards Act, R.S.S. 1978,c. L-1. The grounds relied on by Cajon give rise to thefollowing issues: (1) Did the adjudicator err in law byfinding that the respondent Kovach byher conduct had not frustrated orfundamentally breached her employmentcontract? (2) Whether the adjudicator exceeded hisjurisdiction by holding that Cajon,as Ms. Kovach\'s employer, had anobligation to attempt to resolveplace of work difficulties thatprohibited her from reporting towork? [2] The Director of Labour Standards ordered Cajon to pay its employee, Ms. Kovach, the sum of $1,500.00 in lieu of proper notice of termination. Cajon appealed the order whereupon hearing was conducted before an adjudicator pursuant to s. 62 of the Act. Dirk Silversides, the adjudicator appointed to hear the s. 62 appeal, upheld the director's order. Cajon then launched the appeal now before the Court. The record before the Court is limited to the adjudicator's decision and the exhibits filed. [3] Cajon operates three hairstyling salons in Regina, Saskatchewan under franchise agreement with Magicuts Inc. One of the salons is located in an area within the "Zellers Store at the Northgate Mall" which Magicuts Inc. leased from "Zellers" and sub-leased to Cajon. The only access to the salon by Cajon's employees and customers was through the Zellers Store. [4] Cajon had employed Ms. Kovach since March of 1990. During the last three years of her employment she worked at its Victoria Square Mall Salon. During her lunch break on January 8, 1997, Ms. Kovach entered the Zellers Store and picked up three pencils which she intended to purchase. Because of long line up at the checkout counter and the limited time available to her, she took the pencils to staff room provided by Zellers where the manager of the Zellers Store and security guard immediately accused her of shoplifting, detained her and called for police assistance. After Ms. Kovach was interviewed by police officer and charged with shoplifting, the store manager or the security guard ordered her out of the Zellers Store and informed her that she could not return. Two days after the event, Mr. Johns informed Ms. Kovach that she could not return to work at the Victoria Mall Salon nor work at another Cajon salon. She then sought and obtained record of employment from Cajon which stated: "Unable to come to work. Frustration of contract." The Crown withdrew the shoplifting charges on February 3, 1997. The Adjudicator's Decision [5] The adjudicator rejected Cajon's submission that Ms. Kovach had frustrated or breached her employment contract, thereby releasing Cajon from any obligation to pay wages in lieu of notice. In his decision he distinguished Thomas v. Lafleche Union Hospital, 1991 CanLII 8039 (SK CA), [1991] W.W.R. 209, 93 Sask. R. 150 (C.A.) and applied the test outlined in O'Connell v. Harkema Express Lines Ltd. (1982), 1982 CanLII 3198 (ON SC), 141 D.L.R. (3d) 291 (Ont. Co. Ct.). In O\'Connell, the trial judge at p. 303 set out six essentialelements for determining whether events had frustrated anemployment contract:. . . [It] is incumbent upon the[defendants] to prove that which isunderlined [italicized] below. . . .1. A critical rather than a trivialsupervening event. . .2. An event not of short duration butprotracted in time. . .3. An event not within the contemplationof the parties. . .4. An event coming about without fault oneither party. . .5. An event that rendered the partiesincapable of performing their contractualobligations. . .6. The performance of a contract thatwould radically alter the originalagreement into something other than thatintended. . . Mr. Silversides concluded that Cajon had failed to meet thethresholds stipulated in O\'Connell, particularly the fifthelement. His reasons are stated at p. of his decision: I do not believe there was sufficientevidence to show that the Respondent[Cajon] was incapable of performing itsobligations--i.e. permitting the employeeaccess and egress to the workplace. The Respondent's president, Mr. Johns, did not at any time examine his company's lease (which was, regrettably, not produced at the hearing) with the franchisor/Zellers in order to determine whether the rights of access and egress were guaranteed to the Respondent and its employees (which seems likely) and under which circumstances, if any, these rights could be suspended or terminated. Rather, Mr. Johns simply contacted the franchisor and was told that his employees should have followed the rules imposed upon Zellers employees. This does not seem reasonable on the part of the Respondent in the circumstances. It has seven-year employee who presumably had performed her work satisfactorily and the only efforts by the employer were to ask Zellers whether it was acting reasonably and to make the inquiry (just described) of the franchisor. An employer surely must be expected to make further inquiries and to engage in further efforts to ensure that it can comply with its obligations under the employment contract (i.e. to permit its employees access to the workplace) before it can claim that it is incapable of performing its contractual obligations- -whether that involves, firstly, ensuring that Zellers had the right to bar employees of the Respondent pursuant to the lease or, secondly, if Zellers did have this right, to at least attempt to work out solution to this problem (e.g. permit the Complainant [Kovach] to be escorted to and from her workplace across Zellers' premises). By not engaging in these further inquiries and efforts outlined above the Respondent has not satisfied me that it was incapable of carrying out its obligations, and therefore conclude that the doctrine of frustration cannot be applied to the circumstances of this case. [6] The right of appeal by an employer arises under s. 62.3(1) which reads: 62.3(1) An employer may, by notice of motion, appeal decision of the adjudicator on question of law or of jurisdiction to judge of the Court of Queen's Bench within 21 days after the date of the decision. The nature and extent of such right are canvassed in Baird v. Lawson (1996), 1996 CanLII 6673 (SK QB), 22 C.C.E.L. (2d) 101 (Sask. Q.B.) and Sikorski v. Tri-Hospital Patient Transport and Courier Ltd. (1995), 1995 CanLII 6130 (SK QB), 136 Sask. R. 61 (Q.B.). In Baird, Baynton J. at p. 108 defined the right of appeal in the following terms: The appellants' right of appeal is limited by s. 62.3(1) to question of law or jurisdiction. It is not valid ground of appeal that the adjudicator's findings of facts are incorrect. Even where appeals can be made on grounds of mixed fact and law (such as under The Small Claims Act), the appeal court is not entitled to substitute its own view of the evidence for that of the trier of fact. It can only intervene if the findings of fact are not reasonably supported by the evidence (often termed "palpable and overriding error"). Wedge J. in Sikorski, supra, at pp. 64-5, after considering several authorities, concludes that curial deference should be extended to the findings of fact made by an adjudicator even though the court is considering an appeal and not judicial review. Accordingly, the court should be even less inclined to interfere with the findings of fact by an adjudicator than in the case where an appeal can be brought on ground of mixed law and fact. Only if finding of fact is patently unreasonable does it constitute an error of law that justifies the intervention of the appeal court. As pointed out by Wedge J. in Sikorski at p. 64, without the benefit of transcript, an appeal court is unable to make determination as to whether findings of fact can be reasonably supported by the evidence (the standard of review applicable on appeals allowed on grounds of mixed law and fact). This leaves the court with standard of review limited to instances in which the adjudicator exceeds or fails to exercise jurisdiction or is incorrect in law. The latter ground includes factual decision that is patently unreasonable. [7] While agree with his statement of the general principles, it is important to note that the phrases "patently unreasonable" and "degree of deference" in s. 63(1) appeal may have meanings materially different from those attributed to them in judicial review. Since, the precise definition of neither term is material to the matter before me and counsel have not addressed the same, will leave their definition for consideration in future [8] The hearing process before the adjudicator is not highly specialized one. Consequently, the correctness test applicable to general questions of law apply. [9] In my view, the adjudicator applied theappropriate principles of law to the facts, as hefound them. In addition, his findings of fact cannot be said to be "patently unreasonable" because there was some evidence before him on which he could arrive at the same. Therefore, the appeal based on the submission that the adjudicator erred in law by ruling that the employment contract was not frustrated by Ms. Kovach's conduct is dismissed. [10] The second ground of appeal based on the adjudicator exceeding his jurisdiction also fails. In my view, the adjudicator acted well within hisjurisdiction when determining what the terms of Ms.Kovach\'s employment contract were and that Cajon hadnot fulfilled obligations thereunder. Although not all of the facts presented to him are known to this Court, his decision outlines some evidence upon which he could have arrived at his conclusions. [11] The appeal is dismissed with costs.
The appellant sought an order quashing a decision of an adjudicator following a hearing pursuant to s. 62 of the Labour Standards Act. The Director of Labour Standards ordered the employer to pay $1,500 in lieu of a proper notice of termination. The grounds raised were that the adjudicator erred in law in finding the respondent had not frustrated or fundamently breached her employment contract; the adjudicator exceeded his jurisdiction by holding the employer had an obligation to attempt to resolve the workplace difficulties that prohibited the respondent from reporting to work. The employee had been charged with stealing three pencils on her way through a store to the salon where she worked. The Crown subsequently withdrew the shoplifting charges. She was prohibited from returning that the store and as there was no alternate entrance to the salon the employer treated the contract as frustrated or breached, therefore releasing him of any obligation to pay wages in lieu of notice. HELD: The appeal was dismissed with costs. 1)The adjudicator concluded the employer failed to meet the thresholds stipulated in O'Connell which set out the six essential elements for determining whether events had frustrated an employment contract: a critical rather than a trivial supervening event; an event protracted in time; not within the contemplation of the parties; coming about without fault on either party; an event that rendered the parties incapable of performing their contractual obligations; the performance of a contract would radically alter the original agreement into something other than that intended. The employer did not establish he was incapable of performing his obligations by permitting the employee access to the workplace.  2)The phrases 'patently unreasonable' and 'degree of deference' in a s63(1) appeal may have meanings materially different from those in a judicial review. 3)The hearing process before the adjudicator is not a highly specialized one. The correctness test was applicable to general questions of law. The adjudicator applied the appropriate principles of law to the facts as he found them. 4)The adjudicator acted within his jurisdiction when determining the terms of the employment contract and that the employer had not fulfilled his obligations.