Posts Tagged ‘Contravention of Settlement’

Square Peg in a round hole

 

De Minimis Non Curat Lex Legal

The Latin phrase De Minimis Non Curat Lex Legal stands for the proposition that the law does not care for small or trifling matters. De Minimis was expressed in an 1818 English decision where the Court held that penalties should not be inflexibly severe where there are irregularities or very slight consequences or where the deviation was a “mere trifle” (i). De Minimis arose in the criminal context, but now is widely accepted as a common law defence available in both the criminal and civil context.

Application (or Misapplication) in the Human Rights Context

The Human Rights Tribunal of Ontario has applied this common law defence in a number of recent decisions. The problem is the Tribunal has yet to find an intelligible way to integrate this two hundred year old common law doctrine into the remedially-focused human rights world. Tribunal decisions applying this doctrine have largely arisen in contravention of settlement proceedings, where the parties resolve their dispute and one party subsequently breaches a term of settlement.

In Adorgloh v. Sentrex Communications, (ii)  a 2010 decision of the Tribunal, the Vice-Chair, before hearing any evidence or scheduling the hearing, stated by way of Case Assessment Direction that “it appears to me, without deciding the issue, that any damages for any delay of less than two months, given the amount in question…, would be minimal, assuming there is justification for awarding them.” Prior to hearing the evidence, the Tribunal made clear that it assumed the breach was minimal and did not mention the possible impact the breach may have had on Mr. Adorgloh. Following the teleconference, Tribunal found that the employer contravened a term of settlement and noted there was evidence presented that Mr. Adorgloh suffered mental health issues as a result. Despite this, the Tribunal focused solely on the technical nature of the breach itself and declined to award any remedy. In focusing on the seemingly trivial delay in payment the Tribunal failed to meaningfully consider the impact of the breach on Mr. Adorgloh. In fact, beyond noting that there was some evidence in this respect, the Tribunal did not even mention it in the analysis section of the Decision.

In Pereira v. Designer Furniture and Art, (iii) a decision released in October 2014, the Tribunal heard another contravention of settlement application where extensive evidence was proffered on the impact the contravention had on the Applicant in terms of her mental health. I was Counsel for the Applicant (no, this is not sour grapes – a much more important issue is at play) and made submissions on the application of the de minimis doctrine. I asked the Tribunal to consider the impact on the Ms. Pereira, instead of or alongside the technical nature of the breach. The Tribunal however neither mentioned the Applicant’s submissions on the application of the de minimis doctrine, nor was the impact on the Applicant mentioned at all. The Tribunal found there was a contravention but refused to order a remedy, again focusing solely on the technical nature of the breach. We asked the Tribunal to reconsider and received a boilerplate decision, again not addressing any of the Applicant’s arguments on de minimis. (iv)

It is firmly established that the Ontario Human Rights Code is remedial and not punitive. The objective is to make the Applicant whole, not punish the Respondent. So why is it that the Tribunal does not focus at all on the actual impact of the contravention on an Applicant, beyond just the technical appearance of the breach itself? Looking at the technical breach in isolation – for instance payment sent one month after it was due – may appear “trifling” or de minimis. But what if that one month delay caused an Applicant to lose his or her home or caused an Applicant dealing with serious mental health issues to fall into a depression and become unable to work for a significant period time. What if the Applicant contemplates suicide? I have represented parties in several matters where settlement has been contravened, and while not always the case, this is often the reality (particularly for applicants with serious mental health issues).

In assessing de minimis, the Tribunal must look at the impact of the contravention on the Applicant. If the technical nature of the breach is relevant at all, it should only be one factor, considered alongside the impact of the breach on the Applicant. The Respondent’s intention is irrelevant and the remedy is not to “punish” the Respondent. Remedial legislation focuses on fixing the harm caused. From my perspective, that is difficult and impossible to do when the Tribunal does not consider what that harm may be.

This highlights a bigger issue, perhaps for another article, on the dangers of parachuting common law principles into the human rights context without full appreciation as to how those principles fit with the remedial nature of the Code and established human rights principles.

End Notes

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(i) See Canadian Foundation for Children, Youth and the Law v. Canada (Attorney General), [2004] 1 SCR 76 at paras at 200-207.

(ii) Adorgloh v. Sentrex Communications Inc., 2010 HRTO 2524

(iii) Pereira v. Designer Furniture and Art, 2014 HRTO 1599

(iv) Pereira v. Designer Furniture and Art, 2014 HRTO 1731

 

See No Evil

It is very common for Applicants to settle their Application prior to a Hearing before an adjudicator. Applicants choose to settle for a number of different reasons. Very rarely however do applicants believe the settlement adequately compensates them for their losses (economic losses and pain, humiliation, and loss of dignity). Rather they settle for a variety of other reasons, including:

  • Inability or unwillingness to “re-live” the events giving rise to the Application;
  • The length of time it takes to get to the Hearing can deter Applicants who want to “move on” in their life and put the events behind them;
  • Health issues;
  • Applicants often have concerns with the fact that Tribunal decisions are made public and published on the internet at CanLII. Potential employers in the future may search the internet and discover that Applicants have commenced a human rights proceeding in the past against a previous employer and decide  not to hire them (this is a legitimate concern because such decisions by prospective employers are often very difficult to prove, even though a decision not to hire an employee on the basis of a previous human rights application however would constitute reprisal contrary to section 8 of the Code), and
  • Risk-benefit analysis (Applicants are often in a poor financial situation following discrimination and if they are unable to prove their case before the Tribunal they will not receive any monetary award – A bird in the hand is worth two in the bush or so the old saying goes).

Applicants make significant sacrifices, both economically and emotionally, when deciding to settle. There is frequently an economic power imbalance between Applicants and Respondents. For many Applicants, they cannot afford to wait for or go through a hearing. The same cannot often be said for Respondents. Recognizing the particular vulnerability of those who have alleged discrimination, it is very important that Applicants have confidence that the settlement entered into will be honoured by the Respondent or the Tribunal will intervene appropriately.

There have been a line of cases recently, where Respondents have breached the terms of settlement. Most often, the Respondent has refused to pay or has delayed payment. While many may believe delayed payment is not a “big deal”, to an Applicant who is in dire need of money, it is a “very big deal”. A contravention of settlement also forces the Applicant to turn his or her mind to the issues once again, worry about whether or not they will receive the monetary amount, and have to deal with legal counsel if they are represented, likely incurring additional legal fees. Given the gravity of a breach of settlement, the Human Rights Tribunal should respond aggressively to discourage such acts. To date however, the Tribunal’s response has been lacking.

The Tribunal’s Response to Settlement Contraventions

The Ontario Human Rights Code gives the Tribunal the authority to make any order it considers appropriate to remedy a breach of a settlement agreement.[i] Here is an overview of some of the Tribunal’s recent contravention of settlement decisions:

In Xitimul v. Marriott Hotels[ii] the Respondent was 11 days late in making payment. The Respondent explained that the delay occurred as it had to reissue payment due to a tax deduction error with the initial payment. The Tribunal ordered $150.00 as monetary compensation for the contravention of settlement.

In Weitzmann v. Burns[iii] the Respondent failed to pay the settlement amount of $1,500.00 to the Applicant, explaining that the failure to pay was due to “minor health issues” which “led to serious health issues which he attributed to the applicant’s conduct towards him”. The Tribunal ordered the original $1,500.00 amount be paid. In addition the Tribunal ordered an additional $500.00 as a remedy for the contravention of settlement.

In Schenk v. Nixon[iv] the Respondent failed to pay $25,000.00 to the Applicant pursuant to the Minutes of Settlement. The Respondent explained the failure to pay, claiming to be in dire financial circumstances and “impecunious”. The Tribunal ordered the amount to be paid forthwith, however in the event that they are not paid the Respondent was required to deliver an irrevocable direction to his lawyer to pay the amount from the proceeds of another civil action where the Respondent was a Plaintiff. As a remedy for the contravention of settlement, the Tribunal ordered an additional $1,000.00.

In Medeiros v. Cambridge Canvas Centre[v] the Respondent failed to pay the settlement amount sum of $5,000.00. The Respondent argued that the Applicant breached the confidentiality provision in the terms of settlement and relied upon this alleged breach as an explanation for its failure to pay. The Tribunal ordered the Respondent to pay an additional $1,500.00 to remedy the contravention of settlement.

In Bailey v. Rock With Us Marble & Granite[vi], the most recent contravention of settlement decision (released by the Tribunal in September, 2013), the Respondent agreed to pay the Applicant $7,000.00 in seven installments. The Respondent was delayed in paying the settlement funds. After the Applicant filed an Application for contravention of settlement, the Respondent provided the remainder of the cheques owing. When the Applicant cashed the cheques however, they were rejected for “insufficient funds”. The Tribunal ordered the remainder of the amount owing to be paid and an additional $1,000.00 for monetary compensation arising out of the breach of settlement.

Conclusion

By the time Applicants get to mediation, they very rarely trust the Respondent. If Applicants feel they cannot count on the Tribunal to respond appropriately to contraventions of settlement, we may experience a “chilling effect” and significant decrease in the number of cases that settle.

Damages in the range of $150.00 to $1,500.00 may be insufficient to compensate Applicants for additional harm suffered and discourage future contraventions of settlement.  These damages seemingly do not reflect the fact that Applicants in these situations are typically “re-victimized” and put to greater expense and emotional turmoil with yet another Application to the Tribunal to recover what they are already entitled to.

END NOTES


[i] Section 45.9(8) of the Ontario Human Rights Code states that the Tribunal can “make any order that it considers appropriate to remedy the contravention”.

[ii] Xitimul v. Marriott Hotels, 2011 HRTO 1867

[iii] Weitzmann v. Burns, 2011 HRTO 818

[iv] Shenk v. Nixon, 2011 HRTO 1312

[v] Medeiros v. Cambridge Canvas Centre, 2011 HRTO 1519

[vi] Bailey v. Rock With Us Marble & Granite, 2013 HRTO 1510