ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-10-396808

DATE: 20120618

BETWEEN:

Alan Bland Plaintiff – and – Canadian Farm Insurance Services Inc. and Canadian Farm Insurance Corporation Defendants

Ellen A.S. Low , for the Plaintiff

Antony Niksich , for the Defendants

HEARD: May 17, 2012

REASONS FOR JUDGMENT

POLLAK J.

[ 1 ] This is a Rule 76 wrongful dismissal action brought by Mr. Bland who was employed with either the Defendant Canadian Farm Insurance Services Inc. ("CFIS") or the Defendant Canadian Farm Insurance Corporation (“CFIC”). Mr. Bland’s employment was terminated “without cause” after fifteen months of service. There is a dispute between the parties as to which Defendant was Mr. Bland’s employer.

[ 2 ] CFIS is an insurance brokerage that sells insurance policies.

[ 3 ] CFIC is an insurance company.

[ 4 ] Both Defendants are located at 13220 St. Albert Trail, Suite 375, Edmonton Alberta. They have separate financial records, separate payrolls and separate offices.

[ 5 ] The Defendants allege that CFIS and CFIC carry on separate and distinct business activities. It is submitted that Mr. Bland was an employee of CFIS. They rely on documents that identify him as an employee of CFIS. He was paid by CFIS.

[ 6 ] At the time of his termination of employment, Mr. Bland earned a base salary of $80,000.00, had a company car allowance, and had employee health and dental benefits.

[ 7 ] Following his termination of employment, CFIS paid Mr. Bland $15,457.84 (the equivalent of six weeks’ pay), as pay in lieu of notice of termination, and commission owing in the amount of $10,000.00. As a further courtesy to Mr. Bland, CFIS extended his health benefits to September 30, 2008, and allowed him to operate from office space leased by CFIS in Toronto until the end of December 2008.

[ 8 ] The Defendants allege that Mr. Bland negotiated, agreed to, and received payment of, a termination package and that no amounts are owing to him as a result of his alleged wrongful dismissal from employment.

[ 9 ] It is submitted that in an email dated August 19, 2008, to Mr. Grieve of CFIS, Mr. Bland agreed to the lump-sum payment of one month's salary in lieu of termination notice. As a courtesy, CFIS provided Mr. Bland with a slightly greater lump-sum payment of six weeks' salary in lieu of termination notice.

[ 10 ] Mr. Bland received this payment of six weeks' salary in lieu of termination notice, continued benefit coverage, and use of office space, without raising an objection or claiming he was owed a greater amount of money.

[ 11 ] Nine months after Mr. Bland received his termination package he claimed he was owed more from the Defendants as a result of his wrongful dismissal from employment.

Issues

[ 12 ] The issues are as follows:

(a) Did the parties negotiate a settlement agreement for Mr. Bland’s termination package?

(b) If not, what is Mr. Bland’s appropriate period of pay in lieu of reasonable notice?

(c) What is the quantum of damages payable to the Mr. Bland over the period of reasonable notice (e.g. are benefits included)?

(d) Can the Defendants meet their onus to demonstrate that Mr. Bland has not reasonably mitigated his damages?

[ 13 ] Mr. Bland reported to Mr. Grieve. Mr. Grieve testified that he decided to terminate Mr. Bland’s employment “without cause" as a result of his concerns with Mr. Bland’s performance.

[ 14 ] He testified that he met with Mr. Bland at the offices of CFIS in Edmonton. Mr. Grieve explained his concerns with Mr. Bland’s performance, and that Mr. Bland’s employment was being terminated. Mr. Bland denies this and testified that his employment was terminated over the phone by Mr. Grieve on August 15, 2008, when Mr. Grieve asked him to submit his resignation.

[ 15 ] Mr. Grieve told Mr. Bland that, if he wanted, they could treat the termination as a resignation, and that Mr. Bland would still receive a termination package.

[ 16 ] Mr. Grieve also testified that during this meeting they discussed Mr. Bland’s termination package. They agreed to one month’s pay in lieu of termination notice. Mr. Grieve told Mr. Bland that he should speak to Valerie Tappenden, the office manager, to address such issues as vacation pay and commissions owing.

[ 17 ] Although there is a dispute between the parties with respect to the manner of the termination, Mr. Bland did not dispute Mr. Grieve’s evidence on their discussion of the termination package. It is only the characterization of these discussions that is disputed. The Defendants argue that the parties reached a settlement of Mr. Bland’s wrongful dismissal claims. This is denied by Mr. Bland.

[ 18 ] The parties gave evidence with respect to a series of their email exchanges:

(a) Mr. Bland emailed Mr. Grieve asking for payment of the outstanding commissions, on July 12, 2008, and again on August 5, 2008.

(b) On August 15, 2008, Mr. Bland sent Mr. Grieve a ‘resignation’ email. The subject line of Mr. Bland’s email of August 15, 2008, is ‘Notice of Termination’. In the email, Mr. Bland states “Your monetary settlement offer is greatly appreciated”. He also states:

It will be appreciated if employee benefits for both myself and Samantha can be extended until September 30 th to allow an opportunity to find a new position.

(c) On August 19, 2008, in his response to Mr. Bland’s email of August 15, 2008. Mr. Grieve states:

It is my understanding that Valerie has confirmed the following with you:

Regular pay period ending Aug 23

1 month’s notice pay from Aug 23

Commissions in the amount of $10,000

10 day Holiday Pay

It is my further understanding that Valerie is depositing those funds, less the usual government deductions, into your account today. I believe that matches our discussions.

[ 19 ] On August 19, 2008, Mr. Bland emailed Mr. Grieve. Mr. Bland stated:

Thanks Bill, Val and I have spoken and all is agreed.

Regards / Alan

[ 20 ] The Defendants submit that Mr. Bland’s email of August 19, 2008, in which Mr. Bland stated “all is agreed”, constitutes a settlement between the parties regarding Mr. Bland’s termination from employment claim.

[ 21 ] As a further courtesy to Mr. Bland, CFIS increased the termination payment agreed to, extended Mr. Bland’s health benefits until September 30, 2008, and allowed him to operate from office space leased by CFIS in Toronto until the end of December 2008.

[ 22 ] The parties agree that the perspective of an "objective observer" must be used to decide whether there is a settlement agreement.

[ 23 ] The Defendants submit that Mr. Bland's email correspondence to Mr. Grieve of August 15 and 19, 2008, constitutes a settlement agreement with respect to Mr. Bland's termination package as:

(a) The subject line of Mr. Bland’s email of August 15, 2008, is ‘Notice of Termination’.

(b) In Mr. Bland’s email of August 15, 2008, Mr. Bland stated:

(i) It will be appreciated if employee benefits for both myself and Samantha can be extended until September 30 th to allow an opportunity to find a new position.

(ii) Your monetary settlement offer is greatly appreciated.

(c) In Mr. Bland's email of August 19, 2008, Mr. Bland responded to Mr. Grieve's email setting out the terms of settlement by stating "all is agreed."

[ 24 ] They submit that the fact that Mr. Bland received and kept the termination package is "powerful confirmation of an agreement".

[ 25 ] Further, it is submitted that the settlement was clear. Mr. Bland knew what termination package he was receiving.

[ 26 ] The Defendants submit that the settlement agreement was fair, Mr. Bland did negotiate the settlement agreement, and CFIS did not take advantage of Mr. Bland. Mr. Bland was able to negotiate an extension of his benefits as was reflected in his email of August 15, 2008.

[ 27 ] In applying the reasonable “objective observer test” as required by the jurisprudence, I find that the parties did reach a settlement agreement. I find support for this conclusion in the email exchange referred to above, and in particular the fact that Mr. Bland did engage in negotiations with the Defendants, as is evidenced by his request for an extension of benefits, which the Defendants granted. Although Mr. Bland testified that he expected to get a release and a formal offer from the Defendants, I find that such expectation was not reasonable in the circumstances. A reasonable observer would conclude that the Defendants would not pay Mr. Bland the negotiated amounts, extend his benefits, and let him use their office space, if Mr. Bland had not agreed to settle his claim for wrongful dismissal of employment against them.

[ 28 ] I therefore find that the parties have reached a settlement agreement and that, as the Defendants have paid Mr. Bland pursuant to that agreement, he is not entitled to any of the damages he claims in this action. The action is therefore dismissed.

[ 29 ] In light of this conclusion, it is not necessary for the court to address the remaining issues that would have been relevant had this court found that there was no settlement agreement between the parties.

[ 30 ] The parties had submitted Bills of Costs at the trial. As the successful parties, the Defendants are entitled to be awarded their costs on a partial indemnity basis. If the parties are unable to agree on the amount of such costs, brief written submissions may be made by 12:00 p.m. on July 4, 2012.

Pollak J.

Released: June 18, 2012

COURT FILE NO.: CV-10-396808

DATE: 20120618

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Alan Bland Plaintiff – and – Canadian Farm Insurance Services Inc. and Canadian Farm Insurance Corporation Defendants

REASONS FOR JUDGMENT

Pollak J.

Released: June 18, 2012