Pamela Robyn Krauss

The appellant employer terminated the respondent employee for just cause following an investigation into a co-worker's complaint of sexual harassment.

The employee refused to apologize for the inappropriate comments, although he agreed to sensitivity training.

The trial judge found the termination was not justified, awarding damages in lieu of notice.

On appeal, the Court of Appeal for Ontario found that the trial judge erred in failing to properly apply the just cause test, specifically by not characterizing the employee's conduct as sexual harassment and by focusing solely on the refusal to apologize.

The Court determined that the employee's sexually harassing comments, coupled with his lack of remorse and refusal to comply with the employer's reasonable disciplinary requirement of an apology, constituted an irreparable breakdown in the employment relationship, justifying termination for cause.

The appeal was allowed, and the employee's claim was dismissed.

Following an eight-day trial where the plaintiff obtained judgment for $187,000 plus prejudgment interest, the parties submitted written arguments on costs.

The plaintiff sought partial indemnity costs to the date of his Offer to Settle and substantial indemnity costs thereafter, arguing his Offer was more favourable than the judgment.

The defendant contended that substantial indemnity costs were unwarranted due to the dismissal of the plaintiff's claims for aggravated, punitive, and special damages.

The court found the plaintiff's Offer to Settle complied with Rule 49 and was more favourable, entitling him to partial indemnity costs to the offer date and substantial indemnity thereafter.

Despite insufficient detail in both parties' costs submissions, the court fixed the plaintiff's costs at $145,000 inclusive of disbursements and HST, plus prejudgment interest at 0.8%.

The plaintiff, a 60-year-old Senior Product Designer with 20 years of service, was summarily dismissed for cause following a co-worker's complaint of inappropriate comments.

The employer concluded the comments were harassing and required the plaintiff to undergo training and apologize.

After the plaintiff, through counsel, agreed to training but refused an apology admitting wrongdoing, the employer terminated his employment for "irreparable breakdown in the employment relationship," citing inappropriate comments, lack of remorse, and insubordination.

The court found that the plaintiff's conduct did not justify summary termination for cause, noting the employer's apparent motivation was the plaintiff consulting a lawyer rather than the alleged harassment.

The court awarded the plaintiff 20 months' notice in damages, declining to reduce for mitigation given the specialized field and lack of employer support, and denied aggravated or punitive damages.

This is a costs endorsement following an appeal where the appellant was predominantly successful in overturning a wrongful dismissal finding but unsuccessful on other grounds.

The court assessed the appellant's claim for substantial indemnity costs, which was significantly higher than the damages awarded and the Small Claims Court jurisdiction.

The court found that Rule 49.10 of the Rules of Civil Procedure does not apply to appeals, nor does Rule 14.07 of the Small Claims Court Rules provide for enhanced costs on appeal.

Considering factors under s. 131(1) of the Courts of Justice Act and r. 57.01(1) of the Rules, including the proportionality of costs to the amount at stake and the level of success, the court awarded the appellant $10,000 in costs, inclusive of disbursements and HST, significantly less than the $56,320.96 claimed.

Following a successful summary judgment for wrongful dismissal, the court determined costs and entitlement to prejudgment interest.

The plaintiff had obtained judgment substantially exceeding a prior settlement offer, engaging Rule 49 cost consequences.

The defendant argued the plaintiff should receive no costs due to procedural deficiencies and contested the rate and entitlement to prejudgment interest after filing a notice of appeal.

The court rejected these arguments, finding the defence conduct unreasonable and confirming that the trial court retained jurisdiction to address prejudgment interest prior to formal entry of judgment.

Costs of $21,000 were awarded and prejudgment interest ordered from the date the cause of action arose.