LABOUR RELATIONS |
Annapolis Valley First Nations Band v. Toney
T-1947-03
2004 FC 1728, Kelen J.
13/12/04
18 pp.
Judicial review of Canada Labour Code adjudicator's decision ([2003] C.L.A.D. No. 195 (QL)) respondent constructively dismissed by applicant--Adjudicator holding respondent First Nations Chief, councillors not breaching fiduciary duty by awarding themselves, at end of elected term, five-year employment contracts as gaming commissioners with Council--Band council resolution accepting contracts in August 2001, but respondent beginning to receive payments as gaming commissioner in January 2000--Respondent not returned to office following November 2001 elections--New Band Chief discontinuing payments under contracts on basis not legally binding because employees in position of conflict when contracts awarded, and should not have collected salary from Gaming Commission while being paid as Council members--Respondent filing complaint with Human Resources Development Canada, which referred matter to adjudicator, whose decision now under review--Adjudicator's decision patently unreasonable for three reasons--(1) Adjudicator applied wrong legal test for breach of fiduciary duty by requiring that there be an element of dishonesty-- Central inquiry whether fiduciary acted in best interests of beneficiary, without conflict of interest--Chief and council members not to award themselves substantial benefits to detriment of Band--(2) Adjudicator relied on fact respondent relied on procedural safeguards (i.e. removed himself from discussions involving his contract in accordance with legal advice) to excuse breach of fiduciary duty--Rationale of such safeguards is that if fiduciary removed from decision-making process, remaining "unbiased" fiduciaries able to make decision that accords with best interests of beneficiary--But here, all fiduciaries had interest in contracts--Patently unreasonable for adjudicator to assume that because respondent followed procedural safeguard, not in breach of fiduciary obligations--Compliance with procedural safeguard not tantamount to compliance with fiduciary obligation--And fiduciary cannot claim to be absolved of liability because followed advice of lawyer--(3) Adjudicator relied on fact job advertised for three months and no one on reserve interested, to excuse breach of fiduciary duty--Adjudicator omitted facts notice not advertising salary for jobs; reasonable for Band members to assume jobs not paying salary as historically gaming commissioners not paid salary; no evidence any Band member saw notice--Thus patently unreasonable for adjudicator to assume jobs advertised and no one on reserve interested--Application allowed--Canada Labour Code, R.S.C., 1985, s. L-2.