Date: 19990902
Docket: T-1238-98
BETWEEN:
DANIEL D. GEMBY
Applicant
- and -
HER MAJESTY THE QUEEN IN RIGHT OF CANADA ON
BEHALF OF HUMAN RESOURCES CANADA AND
CANADA EMPLOYMENT INSURANCE COMMISSION
Respondent
REASONS FOR ORDER
MacKAY J.:
[1] The applicant seeks judicial review of a decision of a Board of Referees (the "Board") dated February 9, 1998. By that decision, the Board appointed under the Employment Insurance Act (the "Act")1, approved a de novo rehearing of the applicant's appeal in relation to his claim for benefits under the Act. The applicant seeks an order in the nature of certiorari quashing the decision, and an order compelling the Board to instruct the Employment Insurance Commission (the "Commission") to pay Mr. Gemby his benefits pursuant to an earlier decision of the Board, rendered on December 18, 1997.
[2] The Commission received Mr. Gemby's application for employment insurance benefits on October 8, 1997. On November 5, 1997, the Commission issued a Notice of Disqualification to the applicant, concluding that he had not terminated his employment with Woodlawn Regional Park Authority ("Woodlawn") with just cause. Mr. Gemby appealed the decision, and a hearing before the Board occurred on December 18, 1997. The Board concluded that the applicant was laid off from his summer job and that Woodlawn had prepared his Record of Employment erroneously. The Board allowed the appeal and thus he was entitled to benefits.
[3] On January 8, 1998, a representative from Woodlawn contacted the Commission and complained that the company had not received notification of the hearing of Mr. Gemby's appeal. The commission concluded that there was a breach of natural justice because Woodlawn had not received notice of the hearing to which it was entitled under the Act and it had no opportunity to make representations. The Commission relied on its procedural manual to conclude that a de novo hearing was an appropriate measure to resolve the matter, and it so recommended to a newly constituted Board of Referees. Chapter 18.9.5 of the Commission's manual states, in part:
| 18.9.5 |
| CASES TO BE HEARD "DE NOVO" DUE TO A BREACH TO THE RULE AUDI ALTERAM PARTEM |
| NOTE: This applies only to cases where there was a breach of natural justice because one of the parties did not receive adequate notice of the hearing. It does not apply to any other breaches of natural justice by the Board of Referees itself. Allegations pursuant to Section 80(a) of the Act are to be resolved by the Umpire as the legislation clearly states. |
| (1) It may happen that an interested party was not heard by the Board of Referees because either the Commission did not properly notify the party of the hearing, or mail allegedly did not reach the party or arrived late. If the party complains about such a problem, where practicable, the Agent will arrange to have the case heard by a newly constituted board to ensure that the case is heard "de novo". However, it is the newly constituted Board of Referees who will decide whether to grant a hearing "de novo", please note that "case de novos" are not rehearings. ... |
[4] The applicant objected to the decision to convene a de novo hearing and forwarded arguments to the Board before the rehearing. On February 9, 1998, a newly constituted Board heard argument regarding the Commission's recommendation to hold a de novo hearing and decided to rehear the appeal, de novo. Its decision stated that:
| At a telephone hearing with Mr. Gemby's lawyer, with Mr. Gemby in attendance, the lawyer, Mr. Komamicki, made the point that a Board of Referees had no jurisdiction over whether a case should rehear "Case de Novo" as the Board had been instructed by the Commission to do. |
| After the hearing, the appropriate parts of the Act and the Regulations were found which the Board interprets as giving it the right to make the decision. Section 83(1) of the Act states "A Board of Referees shall give each of the parties interested in an appeal a reasonable opportunity to make representations concerning any matter before the Board. Also in Regulations 111(1); there shall be Boards of Referees consisting of a Chairperson and one or more members chosen from employers or representatives of employers and an equal number of members chosen from insured persons or representatives of injured persons. |
| Also (5) he Commission may, with the approval of the Governor in Council make regulations (al) respecting the practice and procedure for proceeding before a Board of Referees including authorizing the Chairperson of a Board of Referees to determine the practice and procedure.... |
| With this authorization, the Board of Referees for February 9, 1998 has approved a re-hearing Case de Novo. Dates to be approved by all parties concerned. |
Issue
[5] Did the Board exceed its jurisdiction by approving the rehearing and refusing to pay the applicant his benefits in accordance with the original hearing? The applicant urges that the Commission and the Board failed to follow the correct procedure provided by the Act for dealing with the alleged breach of natural justice and for constituting a de novo hearing.
Analysis
[6] The respondent argues that the Board's authority to order a new hearing arises pursuant to section 120 of the Act. That provision provides that:
| The Commission, a board of referees or the umpire may rescind or amend a decision given in any particular claim for benefit if new facts are presented or if it is satisfied that the decision was given without knowledge of, or was based on a mistake as to, some material fact. |
It is urged that the failure to get notice to the employer of the hearing of the applicant's appeal, precluding its opportunity to make representations before the Board, constituted new facts and demonstrated that there was a violation of natural justice.
[7] In my view, section 120 does not provide the Board with the authority to approve a de novo hearing in the circumstances. To interpret the provision to approve a de novo hearing, because of procedural error that may constitute a breach of natural justice, goes beyond the authority of the Board to determine that new facts are presented or that the decision was based on a mistake of material facts. In my opinion the new facts or the mistake must relate to facts that are material to the claim before the Board, not to procedural failures.
[8] Moreover, the Board did not rely on section 120 as its authority to approve a de novo. Instead, it relied on s-s. 83(1) of "the Act", though it did not specify what it meant by "the Act". The provision as quoted in its decision is found not in the Act but in the Employment Insurance Regulations2. In my opinion, that provision of the Regulations does not provide authority for the Board to determine that a prior decision should be set aside and an appeal be heard de novo because of procedural error or breach of natural justice.
[9] The Board's decision refers as well to Regulations 111(1) but the statement of that provision refers to section 111 of the Act which merely describes the composition of a Board, not its powers. The Board's reference to (5) relates to s-s. 111(5) of the Act which does indeed, as the Board notes, authorize the Commission, with approval of the Governor in Council, to make regulations "respecting the practice and procedure for proceedings before a board of referees....", but there are not regulations made or here relied upon to warrant the process followed by the Board in this case. The Commission's manual of procedures clearly does not have the status of regulations, useful though the procedures may be.
[10] In my opinion the Board of Referees, having decided the applicant's appeal on December 18, 1998, was functus officio; it could not reconsider the matter except within the limits of section 120 of the Act if there are found to be new facts or that the decision was based upon a mistake of a material fact.
[11] The act provides the process for redress of a situation when it appears an interested party has not had notice of a hearing which decides an issue. That process, pursuant to section 115 of the Act, is an appeal as of right to an umpire from a decision of a Board of Referees, by the Commission, the claimant, or the employer of the claimant. No such appeal was here initiated.
[12] It is urged for the respondent that in the circumstances of this case, where there appears a clear breach of natural justice in the failure of the employer to receive prior notice of the hearing of the Board of Referees, any appeal to an umpire would simply result in referral back for reconsideration of the claimant's appeal by a newly constituted Board of Referees. The process undertaken here, in accord with the Commission's Manual of Procedure, led to the appropriate process, expeditiously. In my opinion, that would be acceptable were the procedures followed consistent with the law. They were not, in my opinion.
[13] Interestingly, it is urged for the respondent that the Court should now not intervene but rather it should leave questioning of the decision of the Board on a hearing de novo to the determination of an Umpire on appeal. That is, of course, the applicant's position with reference to any issue concerning the validity of the Board's first decision, in December 1998.
[14] It is unusual for the Court to intervene through proceedings in judicial review where the statute provides an appeal process for dealing with issues raised. Yet here the applicant seeks the Court's assistance because the statutory appeal process has not been followed. The circumstances, in my opinion, warrant intervention by an order to set aside the decision of the Board made in February 1999, to proceed with a hearing de novo.
[15] Counsel for the respondent advised at the hearing that since this application was initiated the Commission has devised a new process to deal with cases of this sort by reference to a designated umpire for a ready resolution of situations where there is a procedural failure giving rise to circumstances of a breach of natural justice that might warrant the matter being re-heard. That process may resolve the difficulty arising from procedures followed in this case.
[16] I turn to the applicant's claim for an order in the nature of mandamus for payment of benefits to him in accord with the December 1998 decision of the Board. In my opinion the circumstances for an order of mandamus, ultimately an equitable order, are not here established. Clearly the balance of convenience cannot be said to favour the applicant, at this stage. If his employer is still interested in being heard in relation to his appeal, arrangements for that may still be made, and upon a decision by an umpire that there has been a breach of natural justice warranting a hearing de novo the decision of the original Board in December 1998 will be a nullity. If payment were now ordered or made the claimant would then be subject to a claim for repayment of benefits to which he was not entitled. Entitlement would then depend upon the decision of the new Board of Referees.
[17] Of course, if the applicant's employer no longer wishes to be heard in relation to the claimant's appeal, there is no need for an appeal to an umpire, in my view, for the claim to a breach of natural justice is moot for all practical purposes. In those circumstances the commission does not need an order from this Court to pay the benefits which the Board of Referees in December 1998 determined should go to the applicant. The Commission's statutory duty in those circumstances is clearly to pay the benefits.
Conclusion
[18] For the foregoing reasons an order goes allowing the applicant's application in part, setting aside the decision of the Board of Referees rendered on February 9, 1999.
[19] The applicant requests costs of the proceeding and they are so awarded on the normal party and party basis, in an amount as the parties may agree, or failing agreement in accord with Column 3 in Tariff B of the Federal Court Rules, 1998.
[20] At the commencement of the hearing counsel for the respondent moved, with consent of the applicant, that the respondent be described in the style of cause as set out at the commencement of these Reasons, and the Court's Order now issued directs that the style of cause be changed to read as set out in these Reasons and the Order.
W. Andrew MacKay
Judge
OTTAWA, Ontario
September 2, 1999.
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