James M. Wortzman

The respondent lost its major customer due to a bribery scheme orchestrated by a consultant hired by the appellant, a rival supplier.

The respondent sued the appellant, arguing it was vicariously liable for the consultant's tortious conduct.

The Supreme Court of Canada held that the appellant was not vicariously liable because the consultant was an independent contractor, not an employee, based on a holistic assessment of the relationship.

The Court also held that the trial judge did not err in refusing to reopen the trial to admit fresh evidence from the consultant.

Commercial appeal arising from a bribery scheme that diverted a longstanding supply contract from the plaintiff to the corporate respondents.

The Court of Appeal held that the consultant and his company, although described by contract as independent contractors, functioned as integrated members of the corporate respondents' sales organization and therefore attracted vicarious liability under the organization test.

The court also held that the trial judge erred in refusing to re-open the trial after post-judgment affidavit evidence from the consultant implicated the principal officer in the bribery scheme, as the evidence was apparently credible and could not with reasonable diligence have been obtained earlier.

Judgment was granted against the corporate respondents for compensatory damages and prejudgment interest, punitive damages were not extended vicariously, and a new trial was ordered on the officer's personal liability.