COURT OF APPEAL FOR ONTARIO

CITATION: Zhang v. Shenglin Financial Group Inc., 2020 ONCA 366

DATE: 20200610

DOCKET: C67454

Brown, Paciocco and Nordheimer JJ.A.

BETWEEN

Jing Zhang a.k.a. Jeff Zhang

Applicant (Appellant)

and

Shenglin Financial Group Inc.

Respondent (Respondent)

Rebecca Huang and Zina Rita, for the appellant

Douglas O. Smith and Cindy Zhang, for the respondent

Heard: In writing

On appeal from the judgment of Justice Shaun S. Nakatsuru of the Superior Court of Justice, dated August 27, 2019, with reasons reported at 2019 ONSC 4998.

REASONS FOR DECISION

[1] Mr. Zhang appeals from the judgment of the application judge that dismissed his application for an order requiring the respondent to pay certain service commissions to him.

[2] The respondent is a private financial services company that has eighteen independent agents in British Columbia and Ontario selling insurance products of London Life Insurance. The appellant is one of those agents in Ontario.

[3] The respondent has a Financial Security Advisor Contract (the “contract”) that the agents sign. The contract sets out various policies and procedures that the agents are required to follow in the course of their work. The appellant signed the contract in February 2010.

[4] In June 2017, the respondent gave notice to its agents that payment of the service commissions would depend upon the agents’ performance on new sales. This change took effect as of January 2018. The appellant contends that the respondent did not have the right, under the contract, to make such a change.

[5] The application judge reviewed the terms of the contract. He concluded that the service commissions were a form of compensation or payment that was included within the terms of the contract. The application judge concluded, at para. 13:

Given this, I find it clear and unambiguous that SFG is entitled to put the minimum performance standard it did when it came to payment of SC. Reading the whole of the Contract, two things are clear with respect to the objective intent of the parties: (1) that minimum performance standards were an important part of the Contract; (2) SFG had reserved the right to change the terms of compensation and payment from time to time with notice.

[6] The exercise of interpreting a contract is one of mixed fact and law. The standard of review is consequently one of palpable and overriding error: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633. On this point, we reject the appellant’s argument that this is a standard form contract of the type that would attract a standard of review of correctness under the principles set out in Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37, [2016] 2 S.C.R. 23.

[7] The appellant is unable to show any palpable and overriding error made by the application judge in his analysis of the contract. In particular, we agree with his conclusion that paragraph 4(c) of the contract permitted the respondent to impose minimum performance standards as a condition of paying the service commissions. Paragraph 4(c) reads:

c). Failure to meet minimum performance standards

Any established pay arrangement may be modified or withdrawn upon notice, for failure to meet minimum performance standards and activity levels, as may be set by Shenglin Financial Inc. from time to time.

[8] Further, there is no basis for us to interfere with the application judge’s conclusion that proper notice was given to the appellant respecting the change.

[9] The appeal is dismissed. The parties may make written submissions on the disposition of costs. The respondent shall file its written submissions within five days and the appellant shall file his written submissions within five days thereafter. The parties are limited to three pages for their submissions.

“David Brown J.A.”

“David M. Paciocco J.A.”

“I.V.B. Nordheimer J.A.”