Union member's tort claim must be decided by court – not arbitrator

Court dismisses judge's order on CFL player's damages action

Union member's tort claim must be decided by court – not arbitrator

by Rhonda B. Levy and George Vassos of Littler

In McCoy v. Choi, 2022 ONCA 403, the Court of Appeal for Ontario (OCA) dismissed an appeal of a motion judge’s order, which allowed a Canadian Football League (CFL) player’s action for damages against a physician for misdiagnosing his football injury to proceed in the Superior Court.  The OCA agreed with the motion judge that the medical negligence dispute did not fall within the ambit of the collective agreement (CA), which dealt with claims arising from employment with the CFL team the player had contracted to play for, and not the negligence of an outside party.

Background

The CA and Appendices to the CA

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

The player signed a CFL Standard Player Contract (Standard Contract), which was an appendix to the CA.  Section 20 of the Standard Contract (Section 20) provides that if a player is injured in the performance of his duties, “the Club” must pay medical expenses incurred or arising from the injury provided that the hospital and doctors are selected by the team, until the team’s doctor certifies that the player has sufficiently recovered from the injury to play football, or until one year from the date the injury occurred, whichever is first. 

Section 21 of the Standard Contract (Section 21) provides that if a player is injured while playing and the injury renders him unfit to play skilled football, the team must pay him 100% of his salary and benefits until the first day of training camp the following season. If there is a dispute about the player’s ability to play professional football, a report by a neutral physician (Neutral Report) is prepared and it “shall be conclusive and binding upon the Player and the team.”

The Injury

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

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

The player continued to experience pain once the cast was removed, and a chiropractor requested 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 the injury.”  On the day of his release, the player received a second report from Merivale indicating that he had suffered an “avulsion fracture ulnar styloid” and a “perilunate dislocation.”

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

The player and the Association challenged his release from the Redblacks and requested a Neutral Report. This resulted in the Redblacks paying out the player’s 2014 salary and arranging for his medical treatment.

Player’s Notice to Arbitrate

In 2015, the player filed a notice to arbitrate, seeking damages in the amount of $2,000,000 from the Redblacks for the team’s poor medical treatment after his injury and for labelling him a “faker” and “malingerer.” He has not yet proceeded to arbitration. The player claims the arbitration will address expenses for treatment for one year; negligence by the team, its servants and agents in treating his injury; and salary and benefits payable pursuant to Section 21.

Player’s Action in Damages for Negligence in Misdiagnosis of Injury

In 2016, the player brought an action for $5,000,000 in damages against the physician and Merivale for loss of income, loss of competitive advantage, and health care costs resulting from their negligence in misdiagnosing his injury and the wrongful treatment of his injury.

Physician’s Motion to Dismiss

The physician brought a motion to dismiss the player’s claim pursuant to  r. 21.01.(3)(a) of the Rules of Civil Procedure, on the basis that it fell within the scope of the CA and could be settled only by an arbitrator.

Decision of Motion Judge

The motion judge dismissed the physician’s motion and held that the claim was not a dispute which, in its essential character, arose from the interpretation, application, administration or violation of the CA. The judge further concluded that: the player’s claim was a tort claim that should be allowed to proceed in the Superior Court; the physician was not an agent of the CFL; Merivale was not controlled by the CFL or the Redblacks; there was no exclusive arrangement for the provision of healthcare services with any party to the CA; claims involving third parties were not provided for under the CA; and if the matter were to proceed by way of arbitration, there were costs that would not be recoverable.

The physician appealed the motion judge’s order.

OCA Decision

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

What is the “essential character” of the dispute?

Citing judicial precedent (including Northern Regional Health Authority v. Horrocks, which we discussed here), the OCA noted the legal principles that governed this aspect of the analysis:

  • An arbitrator must adjudicate any dispute arising, expressly or implicitly, from a CA that contains an exclusive arbitration clause such as the one at issue in the appeal; in such cases, the jurisdiction of a court is limited to granting remedies that lie outside the arbitrator’s authority; 
  • A dispute arises from a CA when its “essential character” concerns a subject matter within the ambit of the CA; 
  • The inquiry into “essential character” is factual. The question is whether the dispute is factually related to the rights and obligations in the CA.  The inquiry is not into the legal character the dispute has taken, e.g., a tort action.

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

Does the dispute fall outside the ambit of the CA because the physician is not a party to the CA?

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

Furthermore, the OCA emphasized that Section 20 gave the player the right to demand that the Redblacks pay his medical expenses for up to a year after the injury, but the Redblacks would have no liability in connection with the injury after that time; however, the player would retain a right to make a claim for negligence by the team’s servants or agents.

The OCA determined that this was not a question of the responsibility of “a team’s agent in treating player injuries;” the player’s action for negligence was unrelated to his Section 20 right to make a claim for negligence by the team’s servants or agents. The dispute over the physician’s misdiagnosis was not factually related to any right or obligation the player possessed under the CA.  In addition, the court stressed that while the player filed a grievance pursuant to the CA, this did not confer jurisdiction where none existed.

The OCA found also that neither the physician, nor Merivale, were bound by the rights and obligations set out in the CA.  A dispute concerning the alleged negligence falls outside the ambit of the CA and contemplation of the parties to the CA. The conclusions were sufficient to dispose of the appeal.

Are there costs that the player would not be able to recover if the matter were to proceed by arbitration such that he would be denied effective redress?

Finally, the OCA determined that the CA did not offer effective redress against an outside party.  If the matter were to proceed to arbitration, the player would not be able to recover certain costs and he would therefore be deprived of an effective remedy.   

Bottom Line for Employers

McCoy v. Choi puts unionized employers on notice that, as seen in this case, if a union member makes a claim against a third party and it is determined that the “essential character” of the claim concerns a matter outside 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 within the jurisdiction of a court to decide rather than an arbitrator.

 

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