Decision #161/01 - Type: Workers Compensation

Preamble

An Appeal Panel hearing was held on October 24, 2001, at the request of legal counsel, acting on behalf of the claimant. The Panel discussed this appeal on October 24, 2001 and again on November 14, 2001.

Issue

Whether or not the claimant's right of action is removed pursuant to Section 68(4) of the Act.

Decision

That defendant A is a covered employer under The Workers Compensation Act and therefore the claimant's right of action against Defendant A is removed; and

That defendant B is not a covered employer, however, the right of action against defendant B is vested in the Workers Compensation Board under Section 9(5) of The Workers Compensation Act.

Background

In January 1998 the claimant filed a claim for workers compensation benefits indicating that a block of ice fell off a building and struck the top of her head on January 19, 1998. The claimant reported injuries to the right side of her head and eye. The employer's report of injury stated that the claimant was exiting the building and a piece of ice fell off the roof and struck the employee on her head. Injuries reported included a bruised skull, double vision and headaches.

The Workers Compensation Board (WCB) accepted the claim and wage loss benefits were paid to the claimant between January 20, 1998 and December 17, 1999 when it was determined that the claimant was fit to perform her pre-accident duties.

On January 19, 2000, the claimant (hereinafter referred to as the plaintiff) filed a Statement of Claim in the Manitoba Court of Queen's Bench against two third parties (hereinafter referred to as defendant A & B) seeking damages as a result of the injuries she suffered on January 19, 1998. The following is a brief summary of the facts alleged in the Statement of Claim filed by the plaintiff:

  • defendant A was at all material times the owner of the premises.
  • defendant B was at all material times the registered owner of a leasehold estate of the premises.
  • the defendants, or either of them, were the occupiers and parties in control of the premises.
  • on January 19, 1998, the plaintiff was working as a telephone solicitor with (employer's name) that was located on the premises.
  • on January 19, 1998, the plaintiff completed her work with her employer, exited the building and was proceeding to an automobile which was parked on a street adjacent to and west of the premises.
  • while proceeding in a westerly direction from the premises to the street, the plaintiff was struck by a piece of ice that fell from the roof or walls of the building located on the premises (the "incident").
  • the plaintiff suffered serious, disabling and permanent injuries including but not limited to migraine headaches, dizziness, blurred vision, memory loss, etc. as a result of the incident.
  • the plaintiff has been unable to work since the incident to the present as a result of her injuries and will require ongoing medical care and treatment from time to time in the future by reason of which the plaintiff will continue to incur loss and expense in the future.
  • the plaintiff's injuries were caused by the negligence of the defendants, or either of them, in that they breached their duty of care owed to the plaintiff.
  • each of the defendants are vicariously liable for the actions and/or inadvertence of the other defendant.
  • the defendants, or either of them, are in breach of the Occupier's Liability Act.

In a letter dated November 6, 2000, legal counsel for the plaintiff requested, pursuant to section 68(4) of The Workers Compensation Act (the Act), the Appeal Commission adjudicate and determine whether the plaintiff's right of action is removed by the provisions of the Act.

An Appeal Panel hearing was held on October 24, 2001. At the hearing, it was agreed to by all parties that legal counsel representing the defendants would be submitting additional information with respect to the legal status of each defendant. On October 31, 2001, legal counsel for the defendants provided the requested information to the Appeal Panel and to legal counsel representing the plaintiff. On November 14, 2001, the Appeal Panel met again to discuss the case and took into consideration additional submissions from both legal representative's dated October 31, 2001, November 8, 2001, November 9, 2001 and November 13, 2001.

Reasons

THE ISSUES

This case involves a worker who was injured by a piece of falling ice as she exited the building in which she worked. She filed a claim with the Workers Compensation Board, which was accepted by the board, and wage loss benefits were paid accordingly.

Two years later, she filed a Statement of Claim in Court of Queen's Bench seeking damages from two third parties, hereinafter referred to as Defendant A and Defendant B.

Section 68(4) of The Workers Compensation Act (the Act) gives the Appeal Commission the exclusive right to determine whether or not such actions are barred by the Act from proceeding in court. As a rule, it is the defendant who seeks a declaration from the Commission that the action is barred from proceeding. In this case, in an unusual twist, it is the plaintiff seeking a declaration from the Commission that her action is not statute-barred.

In order to come to a decision in a "section 68(4) hearing", it is essential to establish the status of the parties in relation to the Act. Specifically, the panel must determine whether or not the claimant (plaintiff) is a worker as defined in the Act; whether or not the worker was in the course of her employment; and whether or not the defendants are covered employers as defined in the Act.

In a pre-hearing meeting with counsel for the parties, the Panel asked them to present arguments only in respect of the status of the parties. We noted, in particular, that it is not our job to adjudicate the claim. It is not necessary for the allegations of injury to be proven before the Commission. Thus, it was not necessary for counsel to present evidence or argument before us on these matters.

To resolve the issue before us, we determined that we would have to consider and come to a decision on two specific questions:

  • Does the plaintiff/claimant have a right to pursue an action against Defendant A? (Decision #1);
  • Does the plaintiff/claimant have a right to pursue an action against Defendant B? (Decision #2).

The Panel's Findings

As already noted, it is not the role of the Panel to adjudicate or come to any decision in respect of the allegations contained in the Statement of Claim. Our sole purpose is to determine whether or not The Workers Compensation Act works in such a way as to bar the plaintiff from proceeding with her actions in court.

For the claimant/plaintiff's appeal to this Commission to succeed, we would have to determine that she was not a worker within the meaning of the Act or that she was not in the course of her employment or that the defendants were not employers as defined in the Act.

We have determined that she is a worker as defined in the Act and that the incident in question occurred in the course of her employment.

In respect of Decision #1, we have determined that Defendant A is a covered employer under the Act and is protected from civil action, in this case, by the terms of subsection 13(1) of the Act.

In respect of Decision #2, we have determined that Defendant B is not a covered employer under the Act and is not protected from civil action by the Act. However, pursuant to subsection 9(5) of the Act, any action against Defendant B is vested in the WCB of Manitoba.

RELEVANT LEGISLATION

The authority for this panel to determine whether or not an action may proceed is conferred by subsections 60.8(1)(b) and 68(4) of the Act, which read:

    Jurisdiction of appeal commission
    60.8(1) Subject to subsection 60.9, the appeal commission has exclusive jurisdiction to examine, inquire into, hear and determine all matters and questions arising under this Part in respect of

    (b) determinations under subsection 68(4).

    Board to determine right of action
    68(4) Where an action in respect of an injury is brought against an employer or a worker of an employer by a worker or the legal personal representative or a dependant of the worker, the board has jurisdiction, on the application of a party to the action, to adjudicate and determine whether the right of action is removed by this Act; and the adjudication and determination is final and conclusive, and if the board determines that the right of action is removed by this Act, the action shall be forever stayed.

Subsection 1(1) sets out the definitions of terms used in the Act. The definition of "employer" and "worker" read, in part:

    "employer" includes

    1. a person

      1. who has in service under a contract for hiring or apprenticeship, written or oral, expressed or implied, a person engaged in work in or about an industry..

    "worker" includes

    1. a person, whether or not under the age of 18 years, who enters into or works under a contract of service or apprenticeship, written or oral, expressed or implied, whether by way of manual labour or otherwise .

     

According to subsection 9(1) of the Act a worker may, in certain circumstances, bring an action against a third party. However, this right is qualified by subsections 9(5) & 9(7):

    Right of action against person other than employer
    9(1)     Where an accident happens to a worker in the course of his employment under such circumstances as entitle him or his dependants to an action against some person other than his employer, the worker or his dependants, if entitled to compensation under this Part, may claim the compensation or may bring such an action.

    Where claim vested in board
    9(5)     Where a worker or dependant makes application to the board claiming compensation under this Part, which claim is thereafter approved by the board, any right of action for or in respect of a personal injury to, or the death of, the worker which the worker, or his legal personal representative or dependant, may have been entitled to maintain against a person other than his employer under subsection (1), immediately on approval of the claim by the board, becomes vested in the board; and the board may enter action in its name or in the name of the injured person, or his legal representative or dependant, or jointly with the injured person, or his legal personal representative or dependant, against the other person for the whole or any outstanding part of the claim of the worker, or his legal personal representative or dependant, against the other person for or in respect of the personal injury to, or the death of, the worker.

    Limitation of right of action
    9(7)     In any case within subsection (1), the worker, his or her legal personal representative and dependents, and the employer of the worker have no right of action in respect of the accident against an employer in an industry, or against a worker of such an employer, where the accident happens within the conduct of the operations usual in, or incidental to, the industry carried on by the employer.

Workers compensation legislation was first introduced into Manitoba in 1916 as a disability scheme, which was designed to compensate workers who were injured as a result of workplace accidents. The Workers Compensation Act establishes a social contract of insurance whereby workers have relinquished their right to sue in exchange for prompt and reasonable compensation regardless of fault. On the other side of the equation, employers have received immunity from suit in exchange for their funding the costs of the scheme. The worker's contractual entitlement to compensation in lieu of other rights is set out in subsection 13(1) of the Act:

    Compensation to be in lieu of other rights
    13(1)     The right to compensation provided by this Part is in lieu of all rights and rights of action, statutory or otherwise, to which a worker, or his legal representative, or his dependents, are or may be entitled against the employer, for or by reason of personal injury to, or the death of, the worker occasioned by any accident which happens to him arising out of, and in the course of, his employment; and no action in any court of law against the employer in respect thereof thereafter lies.

A worker's entitlement to compensation is set out in subsection 4(1) of the Act:

    Compensation payable out of accident fund
    4(1)     Where, in any industry within the scope of this Part, personal injury by accident arising out of and in the course of the employment is caused to a worker, compensation as provided by this Part shall be paid by the board out of the accident fund, subject to the following subsections.

FINDINGS OF FACT

Opposing counsel did not present the Panel with an agreed statement of facts. The Panel determined the following facts to be undisputed and relevant to the resolution of this appeal:

  • The plaintiff (claimant) did not work for either of the defendants. She was employed by a staffing agency ("C"), which arranged for her to work for employer "D", which leased space from Defendant A.
  • At the time of the incident, the plaintiff was working for employer D, in an office located in the building owned by Defendant A.
  • The plaintiff is a worker as defined in the Act.
  • Defendant A is a national transportation company with operations across Canada, and is the principal occupant and owner of the building where the incident occurred.
  • Defendant A is an employer in Manitoba, as defined in the Act. As such, it participates in Manitoba's workers compensation scheme.
  • Under the corporate umbrella of Defendant A, its operations include equipment maintenance, holiday booking, accounting, marketing, etc. At the time of the incident, it occupied about 80% of the building; at present, it occupies some 90%. It attempts to lease out the remainder of the space.
  • Defendant B is an international banking corporation, which holds a leasehold title to the building in question. It is not an employer in Manitoba, as defined in the Act. Thus, it does not participate in the workers compensation scheme in Manitoba.
  • On January 19, 1998, a piece of ice fell from an overhang of the building, striking the plaintiff on the head, as she was leaving the building after logging out from work for the rest of the day.
  • The plaintiff/claimant was on building property at the time of this incident.
  • On January 23, 1998, the plaintiff/claimant signed an application for workers compensation. This application was subsequently accepted by the WCB as a compensable injury. The plaintiff/claimant received medical and wage loss benefits as allowed by the Act.

DISCUSSION

The plaintiff has asked that the Panel come to a finding that the WCB should not have accepted her claim.

In support of this premise, her counsel presented two arguments to us:

  1. That - at the time the incident occurred - the claimant/plaintiff was not "in the course of" her employment as required by subsection 4(1) of The Workers Compensation Act (the Act); and/or
  2. That her election to apply for compensation rather than take court action against third parties, as contemplated in subsection 9(1) of the Act, was invalid.

In respect of the first argument, counsel argued that the plaintiff was not on the premises of her employer at the time of the incident and, thus, could not be in the course of her employment. As noted above, the plaintiff had exited the building, but was still on building property.

Plaintiff's counsel relied on a number of WCB policies in support of her argument. She relied on the following excerpts from board policies:

  • No. 44.05.20, General Premises, which states, in part:

    ""In the course of employment" is not limited to the actual tasks or exact hours of work. At the same time, it is generally agreed that workers compensation was not intended to cover the worker during travel between home and the workplace. Between these two extremes, a balanced principle on the subject of going to and from work has developed in the workers compensation arena. Namely, going to and from work is covered on the employer's premises."

  • No. 44.05, Arising Out of and in the Course of Employment, which states that a worker is in the course of employment while travelling, where travel is required and controlled by the employer.
  • No. 44.10.50.10, Transportation Controlled by Employer, which reinforces the above policy, states that the employer is to have direct control over the transportation.

Plaintiff's counsel also relied on Board Policy No. 44.10.50.20, referring, in particular to the policy in respect of multiple tenant areas, such as shopping centres. The Panel informed her that this policy was no longer in effect, but had been replaced by Policy No. 44.05.20, which covers the same matters, albeit somewhat more expansively. The new policy makes specific reference to "multi-storey buildings" used by more than one tenant, stating: "A worker is on the employer's premises and "in the course of the employment" when in a shared area of a multi-storey building." In a shopping mall, this policy provides that "the worker is considered to be in the course of the employment upon entering the particular premises assigned to the employer."

Counsel also argued that the incident did not occur within the time of employment - the plaintiff had logged out - and was leaving for the rest of the day. She was on her way to a hospital on a personal emergency involving a member of her extended family, which, counsel argued was not the same as leaving the building in the ordinary course of leaving for the day. Furthermore, the incident did not occur at a location where she may reasonably be in the course of her employment - the location of the incident was outside the office and outside the building where she performed her normal work duties.

Counsel for the defendants, in response to this argument, also noted Board Policy No. 44.05.20, noting that the policy states that when looking at what arises out of and in the course of employment, you have to look at cases on their "individual merits." He also noted that the policy calls for the application of "a balanced principle on the subject of going to and from work."

He further argued that the plaintiff "would not have been on that property, would not have been close to that building would not have been under the overhang, unless she was there for work purposes." She wasn't there for any of the public purposes that a person might have been near the building, "she was leaving work."

In respect of this question, we have concluded that the plaintiff/claimant was in the course of her employment at the time of the incident.

We take particular note of the introductory paragraph from Board Policy No. 44.05.20, which is quoted above, and which addresses the matter of employer's premises.

We note that Board policy and practice includes, as "employer's premises", parking lots provided by the employer, pathways between the parking lot and the building, and sidewalks and plazas adjacent to and leading into the employer's building.

Furthermore, we accept that the definition of "multi-storey building", included in section 4 of this policy, applies in this case. It reads:

    Multi-Storey Buildings
    1. A worker is on the employer's premises and "in the course of the employment" when in a shared area of a multi-storey building (eg., a multi-level office building occupied by more than one employer/tenant). This includes the exclusive premises of the employer and the shared or common areas such as entrances, lobbies, elevators, stairs and exits.
    2. In a multi-storey building, the issue is not one of whether the employer owns or leases the common areas. Rather, the WCB will consider whether:
      1. The employer (and thus, the employer's workers) has a "right of way" in the common areas.
      2. The building is, on the whole, for use by employers and their workers as opposed to the general public (ie., workers are subject to increased quantity of risk).
    3. An injury in a common area will not normally be covered where the worker's reason for being in the common area is a deviation from the employment.

It is our view that the sidewalks and plaza on the private land immediately adjacent to and forming part of the property of a building are a part of the common areas of the building.

We are of the view that the submission of plaintiff's counsel that we apply the "shopping mall" definition is incorrect.

With respect to the time of the incident, we accept the premise in Policy No. 44.05.20, that "in the course of employment" is not limited to the exact, scheduled hours of work. We do not accept counsel's argument that, since the plaintiff had "logged off" work, she was out of the course of employment. Once a worker is on the premises, the coming to and leaving from work bring the worker into the course of employment.

This may be negated if the worker is engaging in an activity that clearly takes her out of the normal course of employment. Here, it was argued that, since the plaintiff was leaving work at earlier than usual time and for personal business, she was out of the course of employment. We do not accept this argument. Although the time and reason for leaving were unusual, she was nonetheless leaving work, as she did once every day.

Counsel for the plaintiff presented a second and novel argument, which was that the worker (plaintiff) did not make a true election, as contemplated in Subsection 9(1) of the Act.

The plaintiff testified before us that she filed a claim for Workers Compensation on the instruction of her supervisor. She also testified she had called an official with Defendant A, the building owner and principal occupant, to report the incident. This official apparently informed her that his firm was not responsible and advised her to file a claim for compensation.

The plaintiff argued that she was unduly influenced by her employer and the building occupant (Defendant A) into filing a WCB claim; that, if she had been properly informed, she would not have made the claim, but would have pursued civil action instead. Her counsel argued that in circumstances where a worker's legal rights might be affected, the worker should be made fully aware of the results of choosing one option over another, to the point of instructing the worker to seek independent legal advice.

Counsel for the defendant argued that the law is clear - once an application is made and approved, the right of action is lost. As to whether or not the WCB should have accepted the claim, he noted that the board did so only in response to the plaintiff/claimant's application.

According to subsection 9(1) of the Act a worker, who is injured in the course of her employment and who is entitled to compensation as a consequence thereof, has the right to claim compensation or to bring an action against some person other than her employer should the circumstances so warrant.

However, under subsection 9(5), when a worker makes a claim for compensation to the WCB and the claim is approved, the worker's right of action, contained in subsection 9(1), becomes vested in the board. That means that any action taken against a third party must be taken by the board. Subsection 9(2) provides that, where such an action results in a settlement which exceeds the amount of compensation payable, the excess is paid to the worker. Where it is less, the board absorbs the difference. It must be noted that, where merited, the board will pursue such actions.

Subsection 9(7) further restricts or limits this potential right of action, stating that no right of action exists where the third party is a covered employer under the Act, and the incident happens within the conduct of the operations usual in, or incidental to, the industry carried on by the third party employer.

We were provided with copies of decisions made by similar tribunals in other jurisdictions, on the matter of "election." Such precedents are not binding on us, but may, if on point, assist us in coming to our decision. However, in this case, the precedents were not germane, as they did not address the specific issue as to the validity of an election.

We have concluded that the plaintiff's election to file for workers compensation was valid and should stand.

In considering this matter, we were guided by the premise that it is not our role to decide the validity of the election based on the merits of this particular case. Rather, we are to look to the legislation to determine whether or not the Act contemplates the scenario set before us by the plaintiff's counsel, i.e. that all applicants for workers compensation are to be given the opportunity to seek independent legal advice prior to completing their application forms.

We returned to the first principles which guided the development of the worker's compensation regime as it exists in Canada. We took particular note of the "historic trade-off", whereby workers gave up the right to sue their employers for damages in exchange for a no fault insurance program. In exchange for not being sued, the employers agreed to fund the program, collectively. This scheme has worked well for more than eighty years.

Prior to the introduction of worker's compensation, an injured worker, seeking redress, was forced to hire a lawyer and go through the long and expensive vagaries of litigation. Counsel for the plaintiff is asking us to return, at least in part, to that unsatisfactory system.

This aspect of the compensation scheme found support in a recent decision of the supreme Court of Canada, in Pasiechnyk v. Saskatchewan (Worker's Compensation Board), [1997] 2 SCR 890, wherein the late Justice Sopinka wrote:

    While there may be those who would receive less under the Act than otherwise, when the structure is viewed in total, this is but a negative feature of an otherwise positive plan and does not warrant the condemnation of the legislation that makes it possible.

We realize that the plaintiff is not asking us to do away with the scheme completely. Nonetheless, were her request accepted, it would do a disservice to the overall compensation regime. To require claimants all to seek independent legal advice prior to filing a claim would undermine some of the key goals of the scheme, namely to provide benefits in a quicker and less costly manner. It would also re-introduce some elements of fault into the process.

To allow a claimant to retract her election, after receiving benefits in a no-fault environment and then shopping around to find the most potential benefits, would make a mockery of the founding principles of the scheme.

We should point out that the plaintiff/claimant is not really prejudiced by losing this right. Where the facts merit, the board will pursue an action in the claimant's name and, if successful, pay to her any amount in excess of compensation benefits already received.

DECISION #1 - DOES THE PLAINTIFF/CLAIMANT HAVE A RIGHT TO PURSUE AN ACTION AGAINST DEFENDANT A?

Having made the finding that the plaintiff was a worker, as defined in the Act, and that she was in the course of her employment at the time of the incident, the Panel now had to consider the status of defendant A. Was this defendant an employer as set out in the Act?

In its normal course of business, the defendant is an employer as defined in the Act and, thus, participates in the workers compensation scheme in Manitoba. The issue, in this case, is whether or not leasing of office space (or acting as a landlord) is incidental to the industry carried on by defendant A. If it is, then the defendant is protected from suit by the provisions of subsections 9(7) and 13(1) of the Act.

If leasing space is found to be not incidental, an action may proceed, but only if brought by the board, pursuant to subsection 9(5).

As noted above, this corporation operates a wide range of business endeavours beyond its principal role in transportation. These include equipment maintenance, holiday booking, accounting, marketing, etc. As well, it leases out a small amount of unused space in its office building.

It is our view that it only makes good business sense for a corporation to maximize its revenues by renting out unused space. Given the breadth of its corporate activities, leasing space would certainly not be outside of its normal business. Thus, we find that this is an activity incidental to the industry the defendant carries on.

Therefore, we find that no action may proceed against Defendant A.

DECISION #2 - DOES THE PLAINTIFF/CLAIMANT HAVE A RIGHT TO PURSUE AN ACTION AGAINST DEFENDANT B?

In order for the right of action to be barred against Defendant B, the Panel would have to determine that this defendant is an employer, as defined in the Act. If so, then the defendant is protected from suit by the provisions of subsections 9(7) and 13(1).

As noted above, Defendant B is an international banking corporation, which operates in Manitoba only as a leaseholder in the building in question. It is not an employer in Manitoba, as defined in the Act. As such, it does not receive any protection from the Act.

Thus, an action for damages may proceed against this defendant. However, pursuant to subsection 9(5) of the Act, the right of action is vested in the board.

It should be noted that there exists some uncertainty as to which of the two defendants is responsible for the maintenance of the building. Counsel for the Plaintiff presented us with a copy of a "Ground Lease", which seems to indicate that Defendant B is the party responsible for maintenance. Defendant counsel submitted evidence, at the Panel's request and subsequent to the hearing, which indicates that this responsibility falls on Defendant A.

Given the decisions we have come to, it matters not that we resolve this issue. It is not germane. If an action is to be pursued against Defendant B, the courts will determine which of the defendants is responsible for building maintenance.

SUMMARY

In conclusion, we have come to the following determinations to the issues posed in this appeal:

  1. We find that the incident, which occurred on January 19, 1998 and which led to plaintiff/claimant's application for workers compensation, did occur in the course of her employment.
  2. Decision #1 - Does the plaintiff/claimant have a right to pursue an action against Defendant A?

    No. We conclude that, as a covered employer, Defendant A is protected from suit by the provisions of subsections 9(7) and 13(1) of the Act.

  3. Decision #2 - Does the plaintiff/claimant have a right to pursue an action against Defendant B?

    We conclude that this defendant is not protected from suit by the provisions of subsections 9(7) and 13(1). However, pursuant to subsection 9(5) of the Act, the right of action is vested in the WCB.

Panel Members

T. Sargeant, Presiding Officer
A. Finkel, Commissioner
M. Day, Commissioner

Recording Secretary, B. Miller

T. Sargeant - Presiding Officer
(on behalf of the panel)

Signed at Winnipeg this 21st day of December, 2001

Back