Ontario, Canada: OCA Rules Union Member’s Tort Action Against Third Party Should Be Decided in Court Rather Than by Arbitrator | Smaller

In McCoy vs. Choi2022 ONCA 403, the Ontario Court of Appeal (OCA) dismissed an appeal from a motions judge’s order, which allowed the Superior Court to bring an action for player damages of the Canadian Football League (CFL) against a doctor for misdiagnosing his football injury. The OCA agreed with the motion judge that the medical negligence dispute fell outside the scope of the collective bargaining agreement (CC), which dealt with claims arising from employment with the CFL team for which the player had agreed to play, and not from the negligence of an outside party.

Background

The CA and its annexes

When the player signed a contract to play football with the Ottawa Redblacks (Redblacks), a CFL team, he was subject to a CA between the CFL, the Canadian League Players Association (the Association) and the Canadian Football League. Relations Committee (Committee). The Association is the union for all professional football players in the CFL and represents players in their disputes with their team and/or the CFL. The committee is the collective bargaining representative of all CFL teams. The AC contains an arbitration clause which requires that disputes between a player and a team concerning the interpretation, application, operation of the AC be finally settled by arbitration.

The player signed a standard CFL player contract (standard contract), which was an appendix to the CA. Article 20 of the standard contract (Article 20) provides that if a player is injured in the performance of his duties, “the Club” must pay the medical costs incurred or resulting from the injury provided that the hospital and doctors be chosen by the team, until the team doctor certifies that the player has recovered sufficiently from his injury to play football, or until one year from the date on which the injury has occurred, whichever comes first.

Article 21 of the standard contract (article 21) provides that if a player is injured while playing and that injury renders him unfit to play qualified football, the team must pay him 100% of his salary and benefits until on the first day of training camp the following season. If there is a dispute over the player’s ability to play professional football, a neutral doctor’s report (neutral report) is prepared which “shall be conclusive and binding on the player and the team”.

The injury

The Merivale Medical Imaging Clinic (Merivale) is a diagnostic imaging center that provided “preferential treatment” to the Redblacks. The doctor was a radiologist working at Merivale as an independent contractor.

In July 2014, the player injured his wrist during a football match. He was referred to Merivale where the doctor took an x-ray and after examining it diagnosed the injury as “an undisplaced fracture through the base of the ulnar styloid.” The player’s wrist was placed in a cast.

The player continued to experience pain after the cast was removed and a chiropractor ordered follow-up x-rays from Merivale. In September 2014, the player was released from the Redblacks, and the player claimed it was because they thought he was “faking injury”. On the day of his release, the player received a second report from Merivale stating that he had suffered an “ulnar styloid avulsion” and “perilunate dislocation”.

The player claimed that the more serious perilunate dislocation required immediate surgery and that due to the misdiagnosis and mistreatment he had a permanent wrist injury, which ended his football career.

The player and the Association contested his release from the Rougenoirs and demanded a neutral report. This led to the Redblacks paying the player’s salary in 2014 and arranging for his medical treatment.

Player Arbitration Notice

In 2015, the player filed a notice of arbitration, seeking damages in the amount of $2,000,000 from the Redblacks for the team’s poor medical treatment after his injury and for calling him a “doer. and “simulator”. It has not yet proceeded to arbitration. Player Claims Arbitration Will Cover Treatment Costs for One Year; negligence of the team, its servants and agents in the treatment of his injury; and salary and benefits payable under Article 21.

Player’s action for damages for negligence in misdiagnosis of injury

In 2016, the player sued the doctor and Merivale for $5,000,000 in damages for loss of income, loss of competitive advantage, and healthcare costs resulting from their negligence in misdiagnosing his injury and the unjustified treatment of his injury.

Doctor’s motion to dismiss

The doctor has brought a motion to dismiss the player’s claim in accordance with r. 21.01.(3)(a) of the Rules of civil procedureon the grounds that it fell within the scope of the CA and could only be decided by an arbitrator.

Motions judge’s decision

The motions judge denied the doctor’s motion and found that the claim was not a dispute which in its essential character arose out of the interpretation, application, administration or breach of the LC. The judge further concluded that: the player’s claim was a tort claim that should be allowed to proceed in Superior Court; the doctor was not a CFL agent; Merivale was not controlled by the CFL or the Rougenoirs; there was no exclusive arrangement for the supply of health care services with a CA party; claims involving third parties were not contemplated by the CA; and if the matter were to proceed to arbitration, there would be costs which would not be recoverable.

The doctor appealed the motion judge’s order.

OCA Decision

In analyzing the matter, the OCA considered three questions: (1) what is the “essential character” of the dispute; (2) whether the dispute falls outside the scope of the CA because the physician is not a party to the CA; and (3) are there any costs the player would not be able to recover if the matter were to proceed to arbitration such that he would be denied effective redress?

What is the “essential character” of the dispute?

Citing legal precedents (including Northern Regional Health Authority c. Horrocksthat we talked about here), the OCA noted the legal principles that governed this aspect of the analysis:

  • An arbitrator must settle any dispute arising, expressly or implicitly, from a CA containing an exclusive arbitration clause such as that at issue in the appeal; in such cases, a court’s jurisdiction is limited to granting remedies that are outside the jurisdiction of the arbitrator;
  • A dispute arises from a CA when its “essential character” concerns a subject within the jurisdiction of the CA;
  • The “essential character” inquiry is factual. The question is whether the dispute actually relates to the rights and obligations set out in the CA. The investigation does not concern the legal character that the dispute has taken, for examplea tort claim.

The OCA decided that the dispute was not factually related to the rights and obligations of the CA; it did not arise from the CA and therefore did not fall within the exclusive jurisdiction of an arbitrator. The dispute was, essentially, a dispute over a misdiagnosis of an injury by an outside physician who was not affiliated with the Rougenoirs, and the treatment of the injury in accordance with the misdiagnosis, which allegedly caused harm.

Does the dispute fall outside the scope of the CA because the doctor is not a party to the CA?

The OCA answered “yes” to this question. The doctor was not a servant or an agent of the Rougenoir team; he was an independent contractor. The Merivale clinic where the doctor worked was not owned, controlled or directed by the Redblacks, and neither the doctor nor Merivale were parties to the CA or agents of any party thereto.

In addition, the OCA pointed out that Article 20 gives the player the right to demand that Rougenoirs pay his medical expenses up to one year after the injury, but Rougenoirs would have no liability in relation to the injury. after this period; however, the player would retain the right to sue for negligence by team servants or agents.

The OCA determined that it was not the responsibility of “a team agent in the treatment of player injuries”; the player’s action for negligence did not relate to his right under Article 20 to sue for negligence on the part of the servants or agents of the team. The dispute over the doctor’s misdiagnosis was not in fact related to any rights or obligations the player had under the CA. Furthermore, the court pointed out that even if the player had filed a grievance under the CA, it did not confer jurisdiction where none existed.

The OCA also concluded that neither the doctor nor Merivale were bound by the rights and obligations set out in the LC. A dispute over alleged negligence is outside the scope of the CA and review by the parties to the CA. The findings were sufficient to dispose of the appeal.

Are there costs that the player could not recover if the case were to go to arbitration so that he would be denied effective redress?

Finally, the OCA determined that the CA failed to provide an effective remedy against an outside party. If the case were to go to arbitration, the player would not be able to recover certain costs and would therefore be deprived of an effective remedy.

Conclusion for employers

McCoy vs. Choi advises unionized employers that, as seen in this case, if a member of the union makes a claim against a third party and it is determined that the “essential character” of the claim relates to a matter beyond the scope of the collective agreement, and/or the third party is not a party to the collective agreement and claims against third parties are not provided for in the collective agreement, then the claim will be subject to the jurisdiction of a court rather than an arbitrator .