Owens Corning Canada Defends Pension Plan Members\' Claim

Owens Corning Canada Inc. (OCC) defended a claim, on January 21, 2004, by pension plan members in a representative proceeding brought by John Mifsud, president of the Guelph local of UNITE. The claim sought to require OCC to pay into the plan $30 million of contribution holidays taken over the last 15 years, and to set aside pension plan amendments that entitled OCC, upon plan termination, to the remaining $30 million plan surplus.

Justice John Ground of the Superior Court of Justice dismissed the members’ application, finding that the plan was constituted as a contract, not a trust, so that trust law principles did not apply. Accordingly, the plan amendments providing for reversion of surplus to the employer were valid. These plan amendments had been negotiated by representatives of OCC’s unionized labour force. The judge found that the union representatives’ agreement to the pension plan amendments was binding on the plan members, whether active or retired. The judge also found that, in any event, the plan entitled OCC to take contribution holidays so that no further infusion of funds was required, and that the members’ claim regarding the historic contribution holidays was statute barred.

OCC was represented by Torys LLP, with a team that included Michael Penny, Crawford Smith and David Vincent. On labour and related issues, Torys was assisted by Rick Baldwin, Neil Ornstein and Mark Contini of Mathews, Dinsdale & Clark LLP. The applicant was represented by Barrie Chercover, Gary Hopkinson and Simon Blackstone of Green & Chercover in Toronto.