DIVISIONAL COURT FILE NO.: DC-17-845
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
CONWAY, VARPIO and MYERS JJ.
BETWEEN:
Richelle Milloy Plaintiff (Respondent)
– and –
Complex Services Inc. Defendant (Appellant)
Margaret Hoy, for the Respondent
Mitchell Smith, for the Appellant
HEARD at Hamilton: June 7, 2018
CONWAY J. (ORALLY):
1The appellant Complex Services Inc. (“Complex”) appeals from the decision of Justice T. Maddalena dated May 11, 2017 following a 10 day trial. The trial judge found Complex liable for wrongful dismissal of the respondent Richelle Milloy and awarded her damages of $32,137.18.
Background
2Ms. Milloy worked for Complex at its Niagara casino for 10 years, initially as a hostess and later as a table games dealer. In February 2007, at the request of her doctor, Ms. Milloy was placed on modified duties due to a work-related repetitive injury to her right shoulder. She had surgery in July 2007 and returned to work. By April 2008 her doctor told her that her injury was permanent and she could no longer work as a table games dealer.
3Ms. Milloy was given modified duties in various departments at the casino for another two years. During this time, Complex told her to seek alternate employment within the casino that was not a table games dealer position. Ms. Milloy applied for 16 to 22 jobs at the casino, including positions that she had previously held and for which she had received excellent reviews. However, her applications resulted in three interviews and no job offers.
4On June 3, 2010, Complex terminated Ms. Milloy on the basis of frustration of contract. Ms. Milloy sued for wrongful dismissal.
5The trial judge rejected Complex’ defence of frustration of contract and found that Ms. Milloy had been wrongfully dismissed. She noted that the burden of proving frustration was on Complex. She canvassed the applicable legal principles, including Naylor Group Inc. v. Ellis-Don Construction Ltd., 2001 SCC 58, [2001] 2 S.C.R. 943, in which the court stated at para. 53:
Frustration occurs when a situation has arisen for which the parties made no provision in the contract and performance of the contract becomes “a thing radically different from that which was undertaken by the contract”: Peter Kiewit Sons’ Co. v. Eakins Construction Ltd., 1960 37 (SCC), [1960] S.C.R. 361, per Judson J., at p. 368, quoting Davis Contractors Ltd. v. Fareham Urban District Council, [1956] A.C. 696 (H.L.), at p. 729.
6The trial judge found that Ms. Milloy’s disability need not have ended the employer/employee relationship. She considered the fact that Ms. Milloy had done various jobs for Complex over the years, was capable of performing other jobs despite her disability, had an exemplary record, and was not given the opportunity to do so for reasons unknown to her or the court other than “there must have been someone more qualified”. The trial judge noted that Complex’s conduct in denying her alternate employment for no apparent reason was a type of “self-induced frustration”.
7The trial judge rejected the defence of frustration on a secondary ground, namely that Complex had asked Ms. Milloy to apply for jobs only within Complex’s Niagara casinos, leading her to believe that she would obtain a job within the organization.
8Complex submits that the trial judge erred by rejecting its defence of frustration in light of Ms. Milloy’s inability to work as a table games dealer; breaching procedural fairness by applying the doctrine of “self-induced frustration” when it had not been raised or argued at trial; and rejecting the defence of frustration based on Ms. Milloy’s belief that she would have alternate employment within the organization.
Standard of Review
9The standard of review on an appeal of a question of law is correctness. With respect to errors of fact, the appellant must show that the trial judge has made a palpable and overriding error (Housen v. Nikolaisen, [2002] S.C.R. 235, at paras. 8 and 10).
10In a case involving frustration of contract, the standard of a palpable and overriding error applies because the trial judge’s determination that the agreement between the parties had been frustrated is predominantly one of fact: Doucette et al. v. Jones, 2006 NBCA 38, at para. 31.
Analysis
11The trial judge’s rejection of the defence of frustration based on her factual findings is entitled to deference. In this case, it was undisputed that there was no written contract clearly specifying that Ms. Milloy was only to be a table games dealer. Her employment relationship was not so restricted.
12Ms. Milloy had worked for Complex for 10 years and had worked in various positions over that period of time. While she may have worked as a table games dealer at the time her disability became permanent, she was not committed contractually exclusively to that position.
13The trial judge effectively found that Ms. Milloy’s employment was not tied solely to her position as a table games dealer and that her disability need not have ended the employment relationship. These are highly factual findings that were open to her on the record. Complex has not established any palpable and overriding error that warrants appellate intervention. Further, these findings inform the analysis in Antonacci v. Great Atlantic & Pacific Company of Canada, Limited, [2000] 5496 (ON CA), at para. 11, that speaks to the obligations of a large employer when faced with situations similar to that of Ms. Milloy.
14With respect to the issue of “self-induced frustration”, the trial judge did raise it in her exchange with counsel at trial. There was no issue of procedural fairness. Moreover, the trial judge did not apply it as a stand-alone doctrine. Rather, she simply considered it in the context of deciding whether Complex was entitled to rely on the defence of frustration.
15In light of our conclusion that the trial judge properly rejected the defence of frustration based on Ms. Milloy’s contractual terms, we do not need to address the trial judge’s secondary reason for rejecting that defence.
16The appeal is dismissed. Costs in the amount of $13,000 all-inclusive are payable by Complex to Ms. Milloy.
CONWAY J. ENDORSEMENT:
17For oral reasons delivered in court today, the appeal is dismissed. Costs payable by Complex to Ms. Milloy in the amount of $13,000 all-inclusive.
___________________________ Conway J.
I agree
Varpio J.
I agree
Myers J.
Date of Reasons for Judgment: June 7, 2018
Date of Release: June 8, 2018
CITATION: Milloy v. Complex Services Inc., 2018 ONSC 3590
DIVISIONAL COURT FILE NO.: DC-17-845
DATE: 2018-06-07
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
CONWAY, VARPIO and MYERS JJ.
BETWEEN:
Richelle Milloy Plaintiff (Respondent)
– and –
Complex Services Inc. Defendant (Appellant)
ORAL REASONS FOR JUDGMENT
Conway J.
Date of Reasons for Judgment: June 7, 2018
Date of Release: June 8, 2018