October 6th 2006

$100 million Union Pension case at MTS to go forward Court rules

Indications that Provincial auditor interfered with independent audit of pension

Winnipeg – A Court of Queen’s Bench judge ruled this week that a $100-million lawsuit against MTS for misuse of a pension surplus should go to trial.

Justice Daniel Kennedy handed down a 47-page judgment that said there were substantive issues to be decided at trial including whether Provincial Auditor Jon Singleton acted in bad faith.

“I am therefore left with a view that on these matters there are genuine issues for trial as to whether Singleton breached his mandate and acted in bad faith in his handling of the substantive issues of equivalence between the old and new pension plan,” ruled Kennedy.

The case dates back to the privatization of MTS and changes to the pension plans. Unions representing MTS employees – The Communications, Energy and Paperworkers Union of Canada (CEP), International Brotherhood of Electrical Workers (IBEW) and Telecommunications Employees Association of Manitoba (TEAM) – along with MTS Retirees filed for $100 million in damages for misuse of the pension surplus.

The Unions and retires further charge that their pension plan was further harmed by the actions of Singleton and his appointed independent actuary, Clifford Fox. The lawsuit alleges that Singleton interfered with Fox’s decision and effectively reversed his finding, which favoured the Unions and retirees.

“Singleton admitted he knew that assisting in preparing the opinion did not fall under his jurisdiction. The changes were made without knowledge of Fox in at least one stance,” said Kennedy in his ruling.

“This is an important victory for us, confirming the merits of our case,” said Larry Trach TEAM Business Manager, speaking for the Unions and retirees.

Download the decision: PDF File

For more information contact:

TEAM: 1-204-984-9470