FD: FD: DT: D DN: 637/93 STY: Sharman v. Allard PANEL: Moore; M. Cook; Chapman DDATE: ACT: KEYW: Right to sue; In the course of employment

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1 FD: FD: DT: D DN: 637/93 STY: Sharman v. Allard PANEL: Moore; M. Cook; Chapman DDATE: ACT: KEYW: Right to sue; In the course of employment (travelling); Employer (definition of) (contract of hiring); Schedule 1 employer (for profit or gain); Schedule 2 employer; Jurisdiction, Tribunal (right to sue) (dependants); Dependants. SUM: The defendants in two civil cases applied to determine whether the plaintiffs' right of action was taken away. The plaintiffs were passengers in a vehicle driven by the defendant co-worker. They were involved in an accident with a vehicle driven by the personal defendant and owned by the defendant rental car company. The personal defendant was a worker of a company owned by his father. He was proceeding after regular work hours from Sudbury to North Bay to pick up a part needed for the business. The Panel found that the defendant was in the course of employment. The plaintiffs and the co-worker driver were students who were working for the summer for a conservation authority. They were hired under a grant from the province. The defendants submitted that they were excluded from the operation of Part I of the Act or that they were workers of a Schedule 2 employer. Section 2 of Reg excludes educational works from Part I of the Act. However, the Panel found that the conservation authority's predominant function was not educational work. Rather, it was management of land. Section 4(a) of Reg excludes from Part I anything that is not done as a business or trade or for profit or gain. This section was not intended to exclude non-profit operations from the operation of Part I. Rather, it addresses situations where a person is performing a function for a Schedule 1 employer that is not itself done to advance the business of that employer, for example, where a contractor renovates his own home. The Panel found that the conservation authority came within Part I of the Act. Paragraph 9 of Schedule 2 includes employment by a permanent board appointed by the Crown in right of Ontario. However, the conservation authority was not a board. It was a creature of statute. It was properly classified in Schedule 1 class 25. Further, the province was not an employer in this case. It was no more than a source of funds for the conservation authority. The Panel concluded that the plaintiffs' right of action against the co-worker and the other driver was taken away. Any right of action against these defendants as operators of their vehicles was also taken away since they were operating the vehicles in their capacity as workers. The Tribunal did not have jurisdiction regarding the right of action of family members of the living plaintiffs. The family members of one other worker who died in the accident were not dependants of that worker. The family members were the father, mother and brothers of the 16 year old student-worker who lived at home. The rental car company was entitled to a declaration under s. 10(11). [25 pages] PDCON:

2 TYPE: S. 17 DIST: DCON: Decision No. 432/88 (1988), 9 W.C.A.T.R. 306 consd; Decision No. 991/88 (1991), 19 W.C.A.T.R. 68 consd; Decision No. 352/91 (1991), 19 W.C.A.T.R. 308 not folld; Decision No. 28/94 (1994), 29 W.C.A.T.R. 238 refd to; Decisions No. 1153/87 distd, 774/89 consd, 295/90 refd to, 132/91 refd to, 846/93 refd to REGS: Reg. 1102, ss. 2, 4(a), 8; Schedule 2, para. 9 IDATE: HDATE: l ; ; TCO: KEYPER: M. Birnie; P. Leckie; J. Gorman; A. Lyon TEXT: 2

3 WORKERS' COMPENSATION APPEALS TRIBUNAL DECISION NO. 637/93 IN THE MATTER OF an application pursuant to section 17 of the Workers' Compensation Act, R.S.O. 1990, c. W.11, AND IN THE MATTER OF an action commenced in the Ontario Court (General Division) at the City of North Bay as Action No. 824/91, B E T W E E N: DENIS ALLARD, NATHALIE LAVIGNE, TILDEN RENT-A-CAR, TILDEN CAR RENTAL INC., and ONTARIO LIMITED Applicants in this application and Defendants in the Ontario Court (General Division) Action, - and - LEONARD SHARMAN, JOAN SHARMAN, OWEN SHARMAN, KILLAINE SHARMAN, DAG SHARMAN, ANDREA SHARMAN, HUGH SHARMAN, ANTON CARTER, PHYLLIS CARTER, GRANT CARTER, DENNIS CARTER, MARCEL LANDRIAULT, and PAULINE LANDRIAULT Respondents in this application and Plaintiffs in the Ontario Court (General Division) Action,

4 B E T W E E N: AND IN THE MATTER OF an action commenced in the Ontario Court (General Division) at the City of Barrie as Action No. G3225/91, DENIS J. ALLARD, NATHALIE LAVIGNE, and ONTARIO LIMITED Applicants in this application and Defendants in the Ontario Court (General Division) Action, - and - DOMENIC STEVE SCHIAVONE, STAN SCHIAVONE, and JUNE SCHIAVONE Respondents in this application and Plaintiffs in the Ontario Court (General Division) Action.

5 WORKERS' COMPENSATION APPEALS TRIBUNAL DECISION NO. 637/93 IN THE MATTER OF an application pursuant to section 17 of the Workers' Compensation Act, AND IN THE MATTER OF an action commenced in the Ontario Court (General Division) at City of North Bay as Action No. 824/91, B E T W E E N: DENIS ALLARD, NATHALIE LAVIGNE, TILDEN RENT-A-CAR, TILDEN CAR RENTAL INC., and ONTARIO LIMITED Applicants/Defendants - and - LEONARD SHARMAN, JOAN SHARMAN, OWEN SHARMAN, KILLAINE SHARMAN, DAG SHARMAN, ANDREA SHARMAN, HUGH SHARMAN, ANTON CARTER, PHYLLIS CARTER, GRANT CARTER, DENNIS CARTER, MARCEL LANDRIAULT, and PAULINE LANDRIAULT Respondents/Plaintiffs AND IN THE MATTER OF an action commenced in the Ontario Court (General Division) at the City of Barrie as Action No. G3225/91, B E T W E E N:

6 DENIS J. ALLARD, NATHALIE LAVIGNE, and ONTARIO LIMITED Applicants/Defendants - and - DOMENIC STEVE SCHIAVONE, STAN SCHIAVONE, and JUNE SCHIAVONE Respondents/Plaintiffs WORKERS' COMPENSATION ACT SECTION 17 APPLICATION

7 WORKERS' COMPENSATION APPEALS TRIBUNAL DECISION NO. 637/93 These Section 17 applications were heard in Sudbury, on September 23, 1993, and in North Bay on January 11, 12, and 13, 1995, by a Tribunal Panel consisting of: J.P. Moore : Vice-Chair, S.L. Chapman: Member representative of employers, M. Cook : Member representative of workers. THE APPLICATION PROCEEDINGS Applications have been filed, under section 17 of the Act, by the Defendants in two court actions commenced in the Ontario Court (General Division), by the Plaintiffs/Respondents. The issues raised in each of the two applications were the same in all material respects; the applications were heard together and are both addressed in this decision. The parties participating in the hearing, and their representatives, were (all representatives were lawyers, except as noted): - D. Allard was represented by M. Birnie; - N. Lavigne, Tilden Rent-a-Car, Tilden Car Rental Inc., and Ontario Limited, were represented by P. Leckie, an articling student; - D. Schiavone, and other Plaintiffs in the action commenced in Barrie, were represented by T. Bergeron, and C. Bellan, an articling student; - L. Sharman, and the other Plaintiffs in the action commenced in North Bay were represented by J. Gorman; - an intervenor, North Bay Mattawa Conservation Authority was represented by G. Olah; - an intervenor, the Ontario Ministry of Natural Resources, was represented by A. Lyon. THE EVIDENCE The following documents were marked as exhibits: Exhibit #1 : the Section 17 Statement of N. Lavigne, et al.; Exhibit #2 : the Section 17 Statement of the Applicant, D. Allard;

8 2 Exhibit #3 : the Section 17 Statement of the Respondents, D. Schiavone, et al.; Exhibit #4 : a letter from the Board, dated September 22, 1993; Exhibit #5 : the Respondents' personnel records; Exhibit #6 : a letter from the Board, dated October 16, 1992; Exhibit #7 : a letter from the Board dated September 17, 1991; Exhibit #8 : a letter from the Board dated February 26, 1992; Exhibit #9 : a letter from Mr. Birnie, dated December 19, 1993, with attachments; Exhibit #10: the Section 17 Statement of the Office of the Attorney General of Ontario; Exhibit #11: a document book presented by the Office of the Attorney General of Ontario; Exhibit #12: project documents pertaining to the Province of Ontario "Experience '89 Program"; Exhibit #13: an invoice dated June 23, 1989; Exhibit #14: WCB documents for the North Bay Mattawa Conservation Authority -part 1; Exhibit #15: WCB documents for the North Bay Mattawa Conservation Authority -part 2; Exhibit #16: a letter from the City of North Bay, dated January 12, 1995; Exhibit #17: a written statement from D. Allard, dated June 23, 1989; Exhibit #18: an Ontario Provincial Police interview report form dated June 21, The Panel heard testimony from the following individuals: Y. Allard, D. Allard, M. Allard, all of whom testified in their capacity as employees or associates of the employer of D. Allard; from M. Conforti, a senior financial program co-ordinator for the Ministry of Natural Resources; from the Respondent N. Lavigne (now N. Gregson); from W. Becket, secretary-manager of the North Bay Mattawa Conservation Authority; from J. Openshaw, an employee of the North Bay Mattawa Conservation Authority; and from M. Gibb, a former insurance claims adjuster. Oral and/or written submissions were presented by each of the counsel present.

9 3 THE NATURE OF THE APPLICATION The applications before us arise out of claims commenced by the Respondents against the Applicants. The Respondents seek damages for injuries from an automobile accident that occurred on June 21, The issue, broadly, is whether the actions commenced by the Respondents are barred by subsection 10(9) of the Workers' Compensation Act. A number of sub-issues arise in these applications: 1. Was the Applicant, Denis Allard, in the course of his employment for a Schedule 1 employer at the time of the happening of the accident? It was agreed among the parties that Mr. Allard was a worker of a Schedule 1 employer at the time of the happening of the accident. The contested issue was whether he was in the course of that employment when the accident occurred. 2. Were the Plaintiffs/Respondents who were involved in the automobile accident in question in the course of their employment for a Schedule 1 employer at the time of the happening of the accident? It was not contested, and the Panel finds, on the evidence presented, that these individuals were in the course of their employment at the time of the happening of the accident. The unresolved issue is whether they were workers of a Schedule 1 or a Schedule 2 employer. 3. Was the applicant Nathalie Lavigne in the course of her employment for a Schedule 1 employer at the time of the happening of the accident? Ms. Lavigne was a co-worker of the Plaintiffs/Respondents and the driver of one of the vehicles involved in the accident in issue. Although there was some suggestion, during the questioning of witnesses, that the Respondents might argue that Ms. Lavigne was not in the course of her employment at the time of the accident because she was not qualified to drive one of the vehicles involved in the accident, the Respondents ultimately made no argument on this issue. On the evidence, the Panel accepts, and finds, that Nathalie Lavigne was in the course of her employment at the time of the accident. The unresolved issue regarding Ms. Lavigne is whether she, along with her co-workers, were workers of a Schedule 1 or a Schedule 2 employer. 4. If all parties to the accident were workers in the course of their employment for Schedule 1 employers at the time of the happening of the accident, can the Respondents' actions be maintained against Denis Allard and Nathalie Lavigne in their capacity as operators of the vehicles in question, separate from their capacity as workers of Schedule 1 employers? 5. If it is determined that all of the individuals involved in the accident in issue were in the course of their employment at the time of the accident, can this Panel take away the rights of action of the Plaintiffs/Respondents who were not involved in that accident but are Dependents and/or family members of those who were involved in the accident?

10 4 6. It was conceded by the Applicants/Defendants, Tilden Rent-A-Car, Tilden Car Rental Inc., and Ontario Limited, that, by operation of subsection 10(10) of the Act, they are exempted from the protection of subsection 10(9). However, Mr. Leckie requested, on behalf of those parties, that the Panel issue a declaration pursuant to subsection 10(11) of the Act. THE PANEL'S REASONS (i) Background On June 21, 1989, the Applicant Nathalie Lavigne was operating a motor vehicle owned by the Applicant Ontario Limited, carrying on business as Tilden Rent-A-Car. The vehicle driven by Ms. Lavigne included, as passengers, the Plaintiffs/Respondents, Leonard Sharman, Marcel Landriault and Domenic Schiavone. A fourth person, Michael Carter, whose family members are Plaintiffs/Respondents, was also in the van driven by Ms. Lavigne. Shortly after 5 p.m. the vehicle driven by Ms. Lavigne was involved in a motor vehicle accident with a vehicle driven by the Applicant Denis Allard. As a result of the accident, Leonard Sharman, Marcel Landriault and Domenic Schiavone, sustained injuries. Michael Carter was killed. As we noted above, legal action was subsequently commenced by the injured individuals and their family members against both Ms. Lavigne and Mr. Allard, as drivers of the vehicles involved in the accidents. The other named Defendants - Tilden and the numbered company - were named as Defendants as owner of the vehicle driven by Ms. Lavigne. Mr. Allard was the owner of his vehicle. In response to the lawsuits, the Applicants brought applications pursuant to section 17 of the Workers' Compensation Act. Mr. Allard seeks a declaration that the action against him is barred by subsection 10(9) because both he and the individuals injured in the accident were in the course of their employment for Schedule 1 employers at the time of their accident. Ms. Lavigne seeks a declaration that the action against her is barred by subsection 10(9) because both she and the individuals injured in the accident were in the course of their employment for a Schedule 1 employer when the accident happened. Tilden, and the numbered company, seek a declaration, pursuant to subsection 10(11) of the Act, limiting their liability. Concerning the application brought by Ms. Lavigne, the Panel notes our finding above that Ms. Lavigne, and her injured passengers, were all in the course of their employment at the time of the happening of the accident. Consequently, the outcome of the application brought by Ms. Lavigne turns on whether Ms. Lavigne and her co-workers were workers of a Schedule 1 or a Schedule 2 employer. If the former is true, the Respondents' action against Ms. Lavigne is barred. If, however, these individuals were workers of a Schedule 2 employer, the Respondents' action against Ms. Lavigne can proceed.

11 5 Concerning the application brought by Denis Allard, the issue of the employment of the passengers of the Lavigne vehicle is relevant. The other significant issue, in that application, is whether Denis Allard was in the course of his employment at the time of the happening of the accident. As we noted above, there are subsidiary issues that arise out of each of these applications, which we will consider in turn below. Since the focus of a substantial portion of the evidence and arguments turned on the status of Denis Allard, the Panel will deal with that issue first. (ii) Was Denis Allard in the course of his employment at the time of the happening of the accident in issue? As we noted above, it was conceded that, at the time of the accident, Denis Allard was employed by a Schedule 1 business. It was agreed among the parties that Denis Allard was the owner/operator of one of the vehicles involved in the accident giving rise to these applications. What is in dispute is whether, at the time of the happening of the accident, Denis Allard was still in the course of his employment. Most of the testimony presented in the appeal addressed this issue. Among the witnesses who gave evidence on this issue were the Applicant, Denis Allard, his father, the owner of the business for whom Denis Allard worked, and Denis Allard's uncle, the owner of a separate business that shares premises with Denis Allard's employer. We will refer, in this decision, to Denis Allard's father as Y. Allard, and to Denis Allard's uncle as M. Allard. Much of the testimony provided by these three witnesses was inconsistent. Some of these inconsistencies were on significant facts in issue. By way of comment, the Panel notes that the witnesses were testifying about events that occurred more than five years previously. Most of the testimony provided by the witnesses seemed clear and certain. However, the substantial differences among them on both important and unimportant facts left the Panel with the impression that the witnesses, to varying degrees, were filling in gaps in their recollections. However, the Panel was not left with the impression that the witnesses were intending to deceive or mislead the Panel. Our second comment is that the inconsistencies were such that it was apparent that there was clearly no communication among the witnesses concerning their testimony. Consequently, the Panel's interpretation of the inconsistencies in the testimony was that these inconsistencies did not reflect a lack of credibility, but rather reflected difficulties in recollection. At the same time, the inconsistencies in the testimony on crucial points left the Panel in the difficult position of having to determine whose testimony on particular points was more likely to be accurate. In doing this, we looked for areas of common ground among the witnesses. Obvious points of common ground in the testimony provided to us lead us to make the following findings of fact:

12 6 1. The Applicant, Denis Allard, is a worker in a business owned by his father, Y. Allard. He had been employed in that business for eight years prior to the accident. He was paid a flat weekly salary and had no set working hours. His hours of work generally reflected the company's work load. 2. Denis Allard's vehicle, at the time of the accident, was owned by him, and commonly used by him in his work. Most of the expenses associated with the use and maintenance of his vehicle were paid for by the company. 3. On the date of the accident - June 21, Denis Allard had been performing his usual employment at a site away from his employer's premises. He had used his own vehicle to drive to that site and to return from that site to his employer's premises at the end of the work day. 4. At approximately 5:00 p.m. on that day Denis Allard was driving from his employer's premises to the City of North Bay. The reason for this trip was the central issue in dispute, and will be discussed further below. In the course of this trip Denis Allard was involved in a motor vehicle accident with the vehicle driven by the Applicant Nathalie Lavigne. Denis Allard's involvement in this accident was indirect, and his vehicle did not sustain any damage. He remained at the scene after the accident and then returned to his employer's premises. He did not complete his journey into North Bay. 5. Denis Allard did not live in North Bay. Had he been driving to his residence, he would have taken a different route. Denis Allard was, therefore, not commuting to his home when he was involved in the accident. The Panel accepts those facts as proven. We turn now to the contested facts. Most of the inconsistencies in the testimony given to us arose out of the fact that the recollection of Y. Allard, Denis Allard's father and employer, seemed wholly at odds with the recollection of Denis Allard, and his uncle M. Allard. For that reason, the Panel generally rejected the testimony of Y. Allard. However, we note, for comparison, Y. Allard's testimony on crucial points. Y. Allard testified that, on the date in question, he directed his son to drive to North Bay to pick up a pump. Mr. Allard's company was in the well-drilling business, and according to Mr. Allard, one of his customers needed a pump. Y. Allard testified that he instructed his son to drive to North Bay to the home of his brother, M. Allard, to obtain the pump. Y. Allard stated that his brother sold pumps and had a stock of them in the garage of his home. He testified that he did, in fact, obtain the pump several days later from his brother and sold it to the customer who needed it. Denis Allard's testimony was that, on the date in question, his father directed him to drive to North Bay to pick up a part for a pump. Denis Allard

13 7 stated that it was his understanding that a pump on his employer's premises was not working and a part was needed in order to repair it. According to Denis Allard, his uncle in North Bay had the part available and he was to pick the part up at his uncle's home. It was Denis Allard's impression that the part was needed urgently because his father, and other co-workers, needed water to complete a particular task. Denis Allard stated that he seldom saw his uncle socially but did interact with him in a business capacity. His uncle had a shop located on his father's business premises. His uncle's business was well repairs. Denis Allard understood that, on the day in question, the part needed by his father was not available at the nearby shop but was only available at his uncle's home in North Bay. Denis Allard's uncle, M. Allard, testified that he was in the well repair business, that he had a shop on his brother's property, and that he had an office in his home, in North Bay. On the date in question, according to M. Allard, he was at his brother's premises and was informed that a pump on the premises was not working. He inspected it, and concluded that it needed a new part - a motor control box. He discovered that he did not have one in his shop but felt that he could purchase one in North Bay and bring it out the next morning. He then left his brother's premises. Mr. Allard could not recall if Denis Allard was present when he left. M. Allard stated that he purchased the part in question that same afternoon, intending to bring it out the next day. He later heard about the accident involving his nephew. Mr. Allard did take the part out the next morning and made the necessary repairs. M. Allard stated that his brother was aware that the part would be at his home that evening and he acknowledged that circumstances might have arisen that would have prompted his brother to require the part sooner than the next morning. On the other hand, he could not recall his brother saying that he wanted the part that same day. He could not recall anyone telephoning him about picking up the part that evening. Mr. Allard was shown an invoice, dated June 23, 1989, two days after the accident, indicating that the part in question had been sold to Mr. M. Allard's business. Mr. Allard stated that the date of the invoice would not reflect the date of the sale since he was commonly billed for purchases after the purchases had been made. In addition to the testimony provided by these three witnesses, the Panel heard from an individual who investigated the accident in question on behalf of Denis Allard's insurance company. This individual, a claims adjuster at the time, took a written statement from Denis Allard, on June 23, In that statement, Denis Allard identified himself, his employment, his drivers licence number, and his vehicle. He then stated: On June 21/89 approximately 5:15 p.m. I left the yard on Wassi Road and was going to North Bay to pick up a part for a pump.

14 8 The report then went on to describe the circumstances surrounding the accident. The Panel was also provided with an interview summary prepared by an OPP police officer who investigated the accident in question. The summary contained a signed statement from Denis Allard, that was given on June 21, 1989, the day of the accident. That statement contained only a summary of the circumstances surrounding the accident. There was no reference to the purpose of the journey. As we noted above, the Panel had some concerns about the inconsistencies in the testimony provided to us. Generally, we found the testimony of Y. Allard, Denis Allard's father and employer, to be unreliable. On the other hand, we are satisfied that the testimony of Denis Allard, and M. Allard, was presented in a credible fashion. We were particularly impressed with the testimony of M. Allard. He did not expect to be called as a witness and offered what we saw as careful and thoughtful evidence. When we compare the testimony of M. Allard with that of Denis Allard, there is much that is common. Their testimony certainly establishes that a pump was down at Denis Allard's place of employment, and that a part was needed to replace it. We are satisfied that M. Allard had left his brother's work premises prior to Denis Allard returning from his job of that day. We are persuaded that M. Allard intended to purchase the part necessary to repair the pump that same afternoon and would have had it available at his home. We are also satisfied that it would have been reasonable for Y. Allard to send his son into North Bay to obtain the part if he determined that it would be more convenient to repair the pump that evening, than to wait until the next morning. When we weigh all of the evidence, we are persuaded by the preponderance of that evidence that Denis Allard was, at the time of the accident in question, on his way to North Bay to pick up a part required for an employment related purpose. We are persuaded that the part was needed, that the part was available, and that Denis Allard's father knew that the part would be available if Denis Allard drove into North Bay to pick it up. We find that it would have been reasonable for Denis Allard's father to decide that he would like to have the well functioning that evening, rather than waiting until the next morning. We are also persuaded that the statement given by Denis Allard two days after the accident, in which he stated that he was driving to North Bay "to pick up a part for a pump" is entirely credible. We are not aware of any reason why, at that time, Denis Allard would have had any motive for wishing to establish that his role in the accident was work-related. He did not sustain any injuries himself that would have prompted him to seek workers' compensation coverage. We had no evidence before us that he was aware, at the time of the statement, that there were any legal ramifications contingent on whether or not his involvement was work-related. We are also satisfied that his statement at that time is entirely consistent with his explanation to us

15 9 and, more importantly, entirely consistent with the testimony provided by his uncle. Concerning the fact that Denis Allard did not make any reference to a work-related purpose for the trip when he gave a statement to the OPP officer, we find the report prepared for the police officer to be much briefer. It appears to us, from that report, that the officer was only interested in the precise circumstances surrounding the accident, and not in any tangential details. The statement to the claims adjuster is, in all respects, more detailed than the report given to the police officer. Consequently, we accept the testimony of Denis Allard that, at the time of the happening of the accident in question, he was in the course of his employment and we so find. (iii) Were Nathalie Lavigne and the Respondents who were her co-workers employed by a Schedule 1 employer at the time of the accident? On this issue, the Applicants submitted that the Applicant, Nathalie Lavigne, and the Respondents who were her co-workers were in the course of their employment for a Schedule 1 employer when the accident occurred. As we noted above, the Panel heard no argument that Nathalie Lavigne and the Respondents who were her co-workers were not in the course of her employment when the accident happened. Rather, what the Respondents argued was that these individuals were in the course of their employment for an employer who was not a Schedule 1 employer. The Respondents, particularly Mr. Bergeron, made three alternative arguments under this heading: 1. That the North Bay Mattawa Conservation Authority was excluded from the operation of Part 1 of the Act by sections 2 and 4 of Regulation 1102 under the Act. Consequently, the Applicant, Ms. Lavigne, and the Respondents who were her co-workers, were not workers of a Schedule 1 employer. 2. If the North Bay Mattawa Conservation Authority (hereafter referred to as NBMCA) is not excluded from Part 1 of the Act, it was a Schedule 2 employer, and not a Schedule 1 employer. 3. If the NBMCA was a Schedule 1 employer, the individuals in question -Ms. Lavigne, and her co-workers - were also employed by the Province of Ontario (a Schedule 2 employer), and were, therefore, at the time of the accident, workers of both a Schedule 1 and a Schedule 2 employer. That being the case, they fell outside the scope of subsection 10(9). In support of these arguments, Mr. Bergeron relied on the following facts, as demonstrated by testimony and documentary evidence: 1. When the accident happened, Ms. Lavigne and her co-workers were riding in a van leased by the NBMCA. 2. Ms. Lavigne and her co-workers were summer students hired by the NBMCA under a Province of Ontario employment program called "Experience '89".

16 10 Ms. Lavigne and her co-workers ("the students") were hired to perform maintenance services on property owned and managed by the NBMCA. 3. At the time the accident occurred, the students in the van were returning from a job site to the NBMCA offices where they were to remove equipment from the van, store it, and leave for the day. The accident occurred prior to the group's return to the NBMCA offices. 4. Ms. Lavigne was driving the van at the request of her supervisor, who was present with the students in the van. 5. The Experience '89 program provided funds to agencies wishing to hire students in the summer of The funds were provided in accordance with guidelines devised by the Ontario Ministry of Skills Development. The funds provided to the NBMCA were conveyed by way of transfer payments. 6. The NBMCA selected the students who were to be paid out of the Experience '89 funds. These students were paid by the NBMCA from an account held by the NBMCA. The selected students signed an agreement with the NBMCA concerning the rules and regulations of their employment. 7. Ms. Lavigne, and the Respondents who were her co-workers, all signed such agreements and received wages from the NBMCA in the summer of The NBMCA is a corporate body with a Board of Directors, governed by the Conservation Authorities Act. The focus of conservation authorities in the Province of Ontario is to foster sensible use of land. The authorities perform educational, land management, and research functions to advance this goal. The NBMCA works closely with the Corporation with the City of North Bay, which appoints the bulk of the members of the Board of Directors of the NBMCA. The NBMCA owns approximately 1000 acres in the North Bay region, which it manages. Management of that property takes two principal forms: technical work to conserve the land, and supervision of access to the land by the public. 9. The NBMCA, in 1989, had six full-time workers as well as the part-time workers hired under the Experience '89 program. The City of North Bay paid workers' compensation premiums for the full-time workers of the NBMCA during that year. The NBMCA itself paid WCB premiums for the part-time workers hired under the Experience '89 program. The NBMCA reimbursed the City of North Bay for the payments made on behalf of its full-time workers. (The Corporation of the City of North Bay is a Schedule 1 employer.) 10. The NBMCA has reported to the Workers' Compensation Board as a Schedule 1 employer since The NBMCA was placed, by the Board, in Class 25, group 11, of Schedule 1 ("operation of research laboratories, including inspecting or testing"). In the year 1989, the NBMCA made assessment payments to the Board as a Schedule 1 employer. Relying on these facts, the Applicants had, in their submissions, argued that the students involved in the Experience '89 program were workers of the North Bay Mattawa Conservation Authority, and that the North Bay Mattawa

17 11 Conservation Authority was a Schedule 1 employer, at the time of the accident. In response, Mr. Bergeron made the submissions summarized above, which we now review in detail. Mr. Bergeron's first argument was that the NBMCA was excluded from the operation of Part 1 of the Act by several provisions of Regulation 1102 under the Act. Part 1 of the Act includes section 10. Hence, if the NBMCA is excluded from Part 1, it would appear to be excluded from the protection afforded Schedule 1 employers by section 10. Mr. Bergeron cited section 2 of Regulation 1102, which reads in part as follows: 2. The following industries are excluded from the operation of Part 1 of the Act: 2. Educational work, veterinary work and dentistry. Mr. Bergeron argued that what the students did in their job, under the Experience '89 program, was educational work, because part of the function of the NBMCA was public education concerning land use. However, in the Panel's opinion, that provision does not apply to the NBMCA, generally, or to the students in this case. In our opinion, there was no evidence that the predominant function of the NBMCA was educational work. Rather, it appears from the evidence that the "end product" of the NBMCA was management of the land under its control. In our view, the educational component of the NBMCA's public service was a minor one. Similarly, the role of the students hired by the NBMCA under the Experience '89 program was, in our view, to assist in the technical aspect of the land use management of the NBMCA. The evidence presented to us suggested that most of the work performed by the students hired in that summer was physical labour involving landscape maintenance. Consequently, we conclude that section 2 of Regulation 1102 does not apply in this case. Mr. Bergeron also cited subsection 4(a) of Regulation 1102, which reads: 4. Subject to section 8, (a) anything not itself done by the employer as a business or trade or for profit or gain if, but for this section, it would be an industry included in Schedule 1, is excluded from the operation of Part 1 of the Act, except where it is done as a part of or process in or incidentally to or for or for the purpose of an industry in Schedule 1; Mr. Bergeron argued that this provision excluded from the operation of Part 1 any non-profit undertaking, which included the NBMCA, a not-for-profit undertaking. In support of this submission, Mr. Bergeron cited the Tribunal's Decision No. 352/91 (June 27, 1991).

18 12 In that case, the Panel concluded that the Plaintiff in a lawsuit brought against a business purporting to be a Schedule 1 employer was not barred because the employer in question was excluded from the operation of Part 1 of the Act by virtue of the provisions cited by Mr. Bergeron. In so concluding, the Panel found that the employer fell within Schedule 1 but was, at the same time, a non-profit corporation with a volunteer board of directors and, as such, was excluded from the operation of Part 1 of the Act by subsection 4(a) of Regulation This Panel is troubled by that argument, noting that the ramification is that any workers of non-profit agencies, such as municipalities, police forces, etc. fall outside the operation of Part 1 of the Act and are, therefore, not entitled to compensation benefits for work related injuries. Consequently, we find ourselves in respectful disagreement with the Panel that issued Decision No. 352/91. In our view, that Panel has given section 4 of Regulation 1102 a broader interpretation than the words warrant. In our opinion, subsection 4(a) was not intended, by its drafters, to exclude non-profit undertakings from the operation of Part 1 of the Act. Rather, in our opinion, the subsection addresses a circumstance where a person is performing a function for a Schedule 1 employer that is not itself done to advance the business of that employer. The most obvious example of such a case would be one where someone helps a person who is in the contracting business to do renovations to his own home. It would seem to us that subsection 4(a) is intended to apply to that kind of situation. The home renovation would be an activity "not itself done by the employer as a business or for... profit or gain" but which would, on its face, be an industry included in Schedule 1. The purpose of subsection 4(a) is, in our view, to exclude that kind of activity from the operation of Part 1. Such an intention is perfectly sensible. Confirmation of this interpretation is found in section 8 of Regulation 1102, to which section 4 is made subject. Section 8 reads: 8. The construction of, (a) a house or any part of it by an employer who, within three years before the commencement of the house, had completed or has had completed for the employer the building of another house;... whether or not it is done or carried on as a business or trade for profit or gain... is included in the class or classes of industries in Schedule 1 of which according to the nature of work it should be long. That section appears to modify the "home renovation" situation alluded to above by insuring that a contractor cannot engage in sham home renovation in order to avoid the requirements of Part 1 of the Act. The Panel finds further confirmation of our reading of subsection 4(a) of the Regulation in the Tribunal's Decision No. 774/89 (March 12, 1990). In that case, a worker was helping an acquaintance build a house for personal use. The Panel considered sections 4 and 8 of what was then Regulation 951

19 13 and concluded that persons who employ workers in the construction of a house "for their own use" are not included in Part 1 of the Act. The implication of that interpretation is, of course, that section 4 of Regulation 1102 is limited in its application to an "adjunctive" activity by someone who is otherwise a Schedule 1 employer. A somewhat different interpretation of subsection 4(a) is found in the Tribunal's Decision No. 991/88 (1991), 19 W.C.A.T.R. 68. In that decision, the Panel concluded that subsection 4(a) did not apply to a condominium corporation. At page 89, the Panel stated: In our view, s. 4 may be directed at excluding work done for private homes or organizations whose operations are not sufficiently regular or "business-like" that they could be expected to have the administrative apparatus or management know-how to file with the Board and pay assessments whenever they employed workers. The Panel went on to conclude that the condominium corporation was a "business" operating "for profit or gain" and was not excluded from Part 1 by subsection 4(a). Although that Panel's interpretation of the subsection is somewhat different from that of the present Panel, the distinction it is not, in the context of the facts of this case, significant. In our view, the two interpretations describe essentially similar circumstances: the performance of work not intended to advance the regular business of a Schedule 1 employer. Hence, in our opinion, the question to be asked in applying subsection 4(a) is not whether the employer's principal activity is a non-profit one but whether a particular worker works for someone who is otherwise a Schedule 1 employer to perform a task for the employer that is: (1) not itself a business or profit-making undertaking; and (2) not itself part of or incidental to what would also be a Schedule 1 industry. We conclude, therefore, that subsection 4(a) of Regulation 1102 was not intended to exclude from Part 1 of the Act workers and employers involved in non-profit enterprises. In our opinion, the North Bay Mattawa Conservation Authority falls under Part 1 of the Act. Mr. Bergeron's second argument was that the North Bay Mattawa Conservation Authority was not, in fact, a Schedule 1 employer but was, rather, a Schedule 2 employer. We note that this argument was alluded to by Mr. Bergeron during the presentation of evidence but was not aggressively put forward by him in his closing submissions. However, for the sake of completeness, we deal with this issue briefly. Mr. Bergeron suggested that the NBMCA was best described in the following category of Schedule 2: 9. Any employment by or under the Crown in right of Ontario and any employment by a permanent board or commission appointed by the Crown in right of Ontario... [emphasis added]

20 14 Mr. Bergeron suggested that the NBMCA constituted a permanent board or commission appointed by the Crown in right of Ontario. In response to this submission, the Panel notes, first of all, that the NBMCA appears to be a creature of statute rather than a Board or commission "appointed by the Crown in right of Ontario". Ms. Lyon, on behalf of the Ministry of Natural Resources, submitted: that the NBMCA was created pursuant to the Ontario Conservation Authorities Act; that it is a corporate body; and that it has a Board of Directors, most of whose members are appointed by the Municipality of North Bay. That would suggest, in our view, that the NBMCA is not a permanent board or commission appointed by the Crown in right of Ontario. As we noted above, the Board has assigned the NBMCA to Schedule 1, in Class 25, group 11, as an industry involved in the "operation of research laboratories, including inspecting or testing". In view of the fact that the NBMCA's activities focus on conservation and land management, we are satisfied that that group reasonably describes the NBMCA. The fact that the NBMCA does its research, testing and inspecting in the out-of-doors rather than in an actual laboratory does not, in our view, alter the appropriateness of assigning the NBMCA to that group. We conclude, therefore, that the Board has correctly accepted the NBMCA as a Schedule 1 employer. Mr. Bergeron's third argument was that the students involved in the Experience '89 program effectively had two employers: the North Bay Mattawa Conservation Authority, and the Province of Ontario, a Schedule 2 employer. In support of this submission, Mr. Bergeron argued that the funds provided to the NBMCA by the Ministry of Skills Development were accompanied by guidelines that circumscribed the hiring of the Experience '89 students in such a way that the Province of Ontario effectively became a co-employer of the students. Mr. Bergeron noted: that the students hired by the NBMCA were paid, almost entirely, from Experience '89 funds; that the NBMCA was subject to an audit of how the funds were applied; that guidelines were imposed on the NBMCA as to how the funds could be distributed; that the students who worked under the program had to work a minimum of 30 hours and a maximum of 40 hours per week; that minimum wage had to be paid to the students; and that those hired had to fall within a certain age range. As authority for this argument, Mr. Bergeron cited the Tribunal's Decision No. 1153/87 (July 28, 1988). In that case, the widow of a police office brought legal action against the City of Ottawa and the Chief of Police for the Ottawa Police Force. The Panel concluded, in that case, that the widow's right to bring action against both the municipality and the chief of police was barred because both the City and the chief of police were employers of the deceased officer for the purposes of section 10 of the Act. In so concluding, the Panel noted that the chief of police was an employer of the deceased constable by operation of law. The Panel cited the Police Act which made the Chief of Police liable in law for the actions of officers "under his direction and control". The Panel found that the Chief of Police did "direct and control" the employment activities of the worker in that case. The Panel also found that the City was an employer of the deceased

21 15 police officer because it paid the officer's salaries and provided whatever equipment the officer used. The Panel concluded "police officers are an integral part of the City's operation". Mr. Bergeron submitted that the same could be said in the present case. In his submission, the Province of Ontario effectively paid the salary of the Experience '89 students and imposed substantial control on the way in which those students were hired and utilized. Hence, in his submission, the Province was integrally involved in the work of the Experience '89 students. However, in view of this Panel, the present case and the situation facing the Panel in Decision No. 1153/87 are significantly different. As we understand it, Mr. Bergeron is analogizing the Province of Ontario in the present case to the City of Ottawa in Decision No. 1153/87. However, in our opinion, the two bodies played substantially different roles in the respective cases. We note, first of all, that, as the Panel in Decision No. 1153/87 found, the Police Act makes the City responsible for policing the municipality. In so doing, the Police Act imposed on the municipality an obligation to "provide and maintain" an adequate police force. The Panel also noted police officers received their salaries "directly" from the municipality in which they are appointed. Moreover, the municipality was responsible for providing the police officers with the essential tools of their employment. In the present case, our view of the role of the Province is that it was no more than a source of funds for the NBMCA. The guidelines attached to the use of the funds do not reflect, in our view, an intention on the part of the Province to participate in the hiring and supervision of the students ultimately hired by the NBMCA. Rather, in our view, they reflect an intention on the part of the Province to ensure that: (a) the funds are used in a manner consistent with the project's purpose; and (b) the recipients of the funds will redirect them to a target group - in this case, unemployed youth. Consequently, we see the stipulations in the guidelines concerning hiring youth of a certain age as a policy direction, rather than a supervisory function. Similarly, we see the direction in the guidelines concerning payment of wages as being a policy stipulation requiring compliance with the laws of the Province governing payment of wages. Regarding the stipulation concerning the number of hours to be worked by the students, we see that as an intention on the part of the Province to ensure that students participating in the program will earn a certain minimum weekly remuneration. It appears to us that, in all significant respects, the North Bay Mattawa Conservation Authority was the sole employer of the students hired by them pursuant to the Experience '89 program. Once the NBMCA was advised that they had been granted certain funds under this project, the NBMCA was free to hire whichever students they chose. Those students were directed completely in their day-to-day work by full-time employees of the NBMCA. There was no evidence of any provincial input in this regard. The NBMCA paid the Experience '89 students directly from their own account and, importantly, paid workers' compensation coverage for each of these students. For all of these reasons, we do not accept the argument that the Province of Ontario was a "co-employer" of the students hired by the NBMCA under the

22 16 Experience '89 program. In our opinion, those students were workers of the NBMCA exclusively. To summarize our findings under this section, we conclude that the Applicant, Nathalie Lavigne, and the Respondents who were her co-workers, were all workers, in the course of their employment, for a Schedule 1 employer at the time of the accident giving rise to these applications. On the basis of that finding, combined with our finding above that Denis Allard was also in the course of his employment at the time of the happening of the accident in question, we conclude as follows: 1. the action brought against Nathalie Lavigne by the Plaintiffs/Respondents who were her co-workers is barred by subsection 10(9) of the Act; 2. the action against Denis Allard brought by the Plaintiffs/Respondents who were co-workers of Nathalie Lavigne at the time of the accident is barred by subsection 10(9) of the Act. We now deal with the subsidiary issues attendant on those two conclusions. The first of those subsidiary issues arises out of a submission by Mr. Gorman that the Panel direct that the Respondents' right of action continues to exist against Denis Allard and Nathalie Lavigne as operators of their respective motor vehicles. Mr. Gorman argued that taking away the right to sue these individuals as workers did not prevent the Respondents from suing them in their capacity as the operators of motor vehicles. However, in the Panel's opinion, our conclusions that the actions brought against Denis Allard and Nathalie Lavigne are barred by subsection 10(9) of the Act is a comprehensive declaration. We do not read subsection 10(9) as stipulating that the bar against legal action is qualified in some way. Certainly, in the present case, the entirety of the alleged negligence on the part of Denis Allard and/or Nathalie Lavigne occurred in their roles as workers of a Schedule 1 employer. The fact that they were operating a motor vehicle while performing the alleged negligent acts does not, in our opinion, create a separate cause of action. Even if a separate cause of action were established, the right of action would still be barred, in our opinion. We note, as authority, the Tribunal's Decisions No. 432/88 and 28/94. In Decision No. 432/88 (1988), 9 W.C.A.T.R. 306, the Panel barred, under subsection 8(9) [now s. 10(9)], an action based on breach of contract. At page 311, the Panel stated: The Panel, therefore, concludes that subs. 8(9) takes away all rights of action whether they arise in tort or in contract. The Panel in Decision No. 28/94 (1994), 29 W.C.A.T.R. 238, applied that reasoning to a claim based in wrongful dismissal. Several subsequent Tribunal decisions have slightly narrowed the scope of the principle enunciated in Decision No. 432/88, stating that subsection 10(9)