On May 16, 2016, the Quebec Court of Appeal refused to suspend immediate execution of a judgment rendered by the Superior Court of Quebec in a case involving the union of Montreal’s blue-collar workers (the “Union”) and the City of Montreal, in which the Union was ordered to pay $2 million in punitive damages1.

The facts of the case are as follows: from December 5 to 12, 2004, the Union stopped spreading abrasives on city sidewalks in order to voice its dissatisfaction with the new collective agreement. Unfortunately, several accidents occurred as a result of this illegal pressure tactic, as the sidewalks were dangerously icy during that period due to prevailing weather conditions. A class action was subsequently instituted on behalf of the accident victims claiming compensatory damages, as well as punitive damages to sanction the intentional fault of the Union.

The claim for punitive damages was based on unlawful interference with the right of every citizen to health and safety, which is protected by the Quebec Charter of Human Rights and Freedoms2(the “Charter”). In order for such damages to be awarded, the Charter specifies that the interference must be unlawful and intentional3. The Supreme Court of Canada has stated that this condition is met when the person who commits the unlawful interference acts with full knowledge of the consequences that his or her conduct will cause4.

In September 2010, Justice Danielle Grenier of the Superior Court of Quebec concluded that the suspension of sidewalk maintenance operations by the Union had been done deliberately and with full knowledge of the likely consequences, and that its inaction was indicative of complete disregard for the accidents that would inevitably ensue and constituted socially unacceptable behaviour on the part of the Union.

The awarding of punitive damages is governed by Article 1621 of the Civil Code of Québec, which specifies their preventive and dissuasive purpose, and sets out the factors to be considered in awarding them. Thus, the gravity of the fault, the perpetrator’s patrimonial situation, the extent of reparation the perpetrator is already liable for, and whether the payment of the reparatory damages is being wholly or partly assumed by a third party are among the factors to be taken into account by the court in determining the amount of punitive damages to be assessed.

In 2013, the Court of Appeal decided in the instant case that the quantum of punitive damages should be determined after the award of compensatory damages, and the file was accordingly returned to the Superior Court.

Despite this, the Superior Court’s conclusion in January 2016 was the same as that in September 2010: the Union’s conduct had been reckless in the extreme, justifying an award of $2 million against it, especially given that it had the capacity to pay that amount. The Court also took the conduct of the Union’s representatives into consideration in assessing the amount of punitive damages: in the judge’s view, the Union had acted provocatively and showed no remorse for its actions5. Moreover, a subsequent illegal strike in December 2015 indicated that the judgment against it in 2010 had not had the intended dissuasive effect.

In April 2016, the Court of Appeal refused to allow the Union to appeal, and the Union then announced its intention to take the matter to the Supreme Court of Canada. The Union also asked the Court of Appeal to suspend the order to pay $2 million in punitive damages, which in its decision of May 16, 2016 the Court refused to do.

Suspension of such an order is subject to three conditions, namely whether there is a serious issue involved, whether substantial harm would otherwise ensue, and the balance of inconveniences test6. The Court was asked to decide whether the judge’s taking into account events that occurred after the fault giving rise to the punitive damages constituted an error of law tantamount to a serious issue. The Union also argued that Justice Grenier erred in law by awarding an amount that had no rational connection to the objectives of a punitive damages award specified in the Civil Code of Québec.

After pointing out that it must show due deference to the assessment of the facts by the judge of first instance, the Court of Appeal confirmed the correctness of Justice Grenier’s analysis. The Court thus endorsed her reasons for judgment that were based on the after-the-fact conduct of the Union and its representatives. In doing so, the Court stressed the dissuasive purpose of a punitive damages award, which justified taking into consideration the Union’s contemptuous attitude and its recidivism. The Court also rejected the Union’s contention that the amount it was being ordered to pay would cause it serious harm, noting that the Union could easily comply with the order without negatively impacting the amount of its members’ dues.

This decision illustrates the importance of conduct subsequent to the commission of a fault when it comes to assessing punitive damages. Thus, the Union’s continued use of illegal pressure tactics, coupled with its contemptuous attitude, had an undeniable impact on the quantum of the damages. The public disparagement of the judge of first instance by a union representative also had an effect on the quantum. In addition, the decision indicates the flexibility of Article 1621 of the Civil Code of Québecand the multitude of factors that can be taken into account when assessing punitive damages.

This decision also illustrates the limits of trade-union privilege. While union representatives do enjoy some latitude in fulfilling their functions of representing members, that latitude does not extend to actions that are illegal or harmful to the employer. The nature of their mandate dictates the type of conduct union representatives can engage in. Fomenting an illegal strike and using abusive and insulting language are incompatible with that mandate. Union representatives cannot rely on their representative status to act with impunity.

It will be interesting to see if the Supreme Court of Canada agrees to hear the Union’s appeal.

Written in collaboration with student-at-law Justine Brien