Geoff Mens

This is a remand from the Supreme Court of Canada to the Ontario Court of Appeal concerning the award of incentive plan-related damages in a wrongful dismissal action.

The Supreme Court remanded the case for disposition in accordance with Matthews v. Ocean Nutrition Canada Ltd. The majority of the Court of Appeal affirmed its original decision, finding that the employee, Mr. Manastersky, was not entitled to additional damages beyond his vested interest in the Mezzanine Carried Interest Plan (CIP) because the plan's terms did not entitle him to annual payments or future investment periods.

The court held that RBC Dominion Securities Inc. had paid Mr. Manastersky all to which he was entitled at common law.

Feldman J.A. dissented, arguing that the trial judge's original decision, which awarded additional damages, correctly applied the legal principles affirmed in Matthews, emphasizing the requirement for "absolutely clear and unambiguous" language to limit an employee's common law right to compensation.

The plaintiffs brought a Rule 21 motion to determine the effect of a Pierringer Agreement and a prior court order on the remaining claims against the non-settling defendant and subsequent third and fourth parties.

The court clarified that the prior order restricted the plaintiffs' claim against the remaining defendant to several liability, but did not affect the remaining defendant's ability to pursue contribution from third parties.

The motion was resolved with all parties ultimately agreeing on this interpretation, and costs were deferred to the pre-trial or trial judge.

This is a costs endorsement following an appeal from a trial judgment.

The appellants (RBC Dominion Securities Inc. and Royal Bank of Canada) achieved mixed success on appeal: the court unanimously dismissed their appeal regarding the foreign exchange methodology award, but a majority allowed their appeal regarding the carried interest plan damages award, reducing the principal judgment from $1,144,181.50 to $190,789.

The parties disagreed on the treatment of the trial costs award of $100,000 in light of the appeal disposition.

The appellants sought reduction to $40,000, while the respondent sought to maintain the award or reduce it to no less than $75,000.

The court reduced the award to $80,000, considering that the respondent succeeded on four main issues at trial, with no appeal taken on two issues, and only divided success on the two issues that were appealed.

Appeal of wrongful dismissal damages award.

Employer terminated employee without cause and conceded entitlement to 18 months' notice.

Trial judge awarded damages for lost opportunity to earn carried interest plan entitlements during notice period and for foreign exchange methodology differences.

Appellate court allowed appeal in part, setting aside damages for lost carried interest opportunities but upholding foreign exchange award.

Key issue: whether employee entitled to damages for incentive compensation under plan that employer had contractual right to terminate, where plan was integral to employee's compensation package.

Genstar Development Partnership appealed a Superior Court decision dismissing its application for specific performance to enforce a repurchase option contained in an Agreement of Purchase and Sale dated August 21, 1998, between Imasco Enterprises Inc. and the Roman Catholic Episcopal Corporation of the Diocese of Hamilton.

The repurchase option allowed the vendor to repurchase property if not developed as a church within 10 years.

The application judge found that Genstar had not established it was a successor to Imasco or an equitable assignee of the repurchase option, and that Genstar's tenders were deficient.

The Court of Appeal dismissed the appeal, finding no palpable and overriding error of fact and upholding the application judge's discretionary decisions regarding the admission of supplementary evidence and conversion to an action.

The applicant, Genstar Development Partnership, sought to repurchase a property from the respondent, The Roman Catholic Episcopal Corporation of the Diocese of Hamilton, based on a right defined in an Agreement of Purchase and Sale.

Genstar claimed to be a successor or equitable assignee of the original vendor (Imasco) and sought specific performance.

The court dismissed the application, finding that Genstar failed to prove its status as a successor due to an incomplete evidentiary record.

As an assignee, Genstar failed to provide the statutory notice required by the Conveyancing and Law of Property Act.

Furthermore, the court found no anticipatory breach by the respondent and determined that Genstar's tenders were deficient due to an incorrect purchase price.