DATE: 20060605

DOCKET: C43173

COURT OF APPEAL FOR ONTARIO

RE:

PATRICK FARRELL (Plaintiff (Respondent in Appeal)) – and – WORKGROUP DESIGNS LTD., WORKGROUP DESIGNS INC., CHRISTOPHER DE CAIROS, CLIVE COSTA-CORREA, BRIAN CHALMERS, BRIAN K. LAXDAL (Defendants (Appellants in Appeal))

BEFORE:

SIMMONS, CRONK and MACFARLAND JJ.A.

COUNSEL:

James J. Van Wiechen

for the appellants

James G. Knight

for the respondent

HEARD & RELEASED ORALLY:

May 31, 2006

On appeal and cross-appeal from the judgment of Justice Mary Anne Sanderson of the Superior Court of Justice dated January 26, 2005.

E N D O R S E M E N T

[1] There are three issues on this appeal.

[2] First, the appellants argue that the trial judge erred by concluding that a binding employment agreement was made between the parties in February 2000. They submit, in particular, that the trial judge ignored important evidence relevant to whether the agreement alleged by the respondent was made, and that this failure fatally tainted the trial judge’s key factual findings regarding the agreement and the compensation promised to the respondent. We disagree.

[3] The appellants concede that the matters said to have been ignored by the trial judge in her decision were argued forcefully before her in final argument at trial. We were advised by counsel that they were also the subject of written submissions at trial. In her reasons, the trial judge expressly accepted the evidence of the respondent and a witness called by him regarding the contested 2000 agreement, and expressly rejected the evidence of the appellants’ witnesses.

[4] In these circumstances, we see no error by the trial judge, let alone a palpable and overriding error. The factors identified by the appellants all went to the assessment of credibility, a matter squarely within the trial judge’s domain.

[5] Moreover, to the extent that the appellants also contend that the evidence at trial did not support the trial judge’s conclusions regarding the bargain between the parties, we think that this contention is unsupportable. On this record, there was evidence lead by the respondent, which, if accepted by the trial judge, established the agreement in question. In the end, this ground of appeal is fact driven. We see no basis for appellate intervention.

[6] Second, the appellants submit that the trial judge erred by holding, essentially, that the respondent discharged his obligation to mitigate his damages. They submit that, acting reasonably, the respondent was obliged after the termination of his employment to accept the consulting arrangement then proposed by the appellants.

[7] Again, we disagree. The terms of the suggested consulting arrangement were vastly different than the terms of the respondent’s previous employment. For example, although he had previously been president of the company, the proposed arrangement removed the respondent’s corporate authority, reduced his minimum compensation by about fifty percent, eliminated his use of an office, and required him, when attending meetings with third parties concerning the corporation, to be accompanied by one or more of his former subordinates. Taken together, these terms were demeaning to the respondent. He was not obliged at law to accept this materially altered arrangement to satisfy his mitigation obligation.

[8] Finally, although the appellants challenged both the notice period and the Wallace damages allowed by the trial judge, they acknowledged during oral argument that these grounds of appeal were dependent for success upon the success of their first ground of appeal. As they have been unsuccessful on their first ground, this challenge also fails.

[9] Accordingly, for the reasons given, the appeal is dismissed. The cross-appeal is dismissed as abandoned, in accordance with the notice of abandonment that counsel advises has been filed. The respondent is entitled to his costs of the appeal on a partial indemnity scale, fixed in the total amount of $20,544 as agreed by counsel, inclusive of disbursements and Goods and Services Tax.