ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-12470810
DATE: 20130704

BETWEEN:

Diane Bernier
Plaintiff

– and –

Nygard International Partnership
Defendant

Chris Foulon and Andrea Stoddart, for the Plaintiff

Shane Rayman, for the Defendant

HEARD: June 6, 2013

Morgan J.

[1] Upon being terminated from her employment, the Plaintiff received the minimum statutory salary and benefits required under the Employment Standards Act, 2000, SO 2000, C 41 (the “Act”). She claims that this fell far below the amounts to which she has a right at common law.

[2] The Plaintiff here moves for summary judgment under Rule 20 of the Rules of Civil Procedure. She seeks the monetary difference between the statutory entitlements and her common law rights.

[3] The Defendant seeks to resist the motion. It contends that the Plaintiff has been paid all that she is entitled to receive, or that, in any case, the test for summary judgment under Rule 20.04 has not been met as there are issues raised by the action that require a full trial.

[4] For the reasons that follow, the Plaintiff is entitled to the amounts that she claims. There is no genuine issue requiring a trial.

I. The Plaintiff’s employment and termination

[5] The Plaintiff was a management level employee who worked for the Defendant for 13 years. On December 4, 2012, at the age of 54, the Plaintiff was terminated without cause by the Defendant.

[6] During her employment with the Defendant, the Plaintiff’s compensation was comprised of a base salary, an annual bonus, a car allowance, health and dental benefits, and employer contributions to disability and life insurance coverage. For the final four years of her employment prior to termination (2008 through 2011), the Plaintiff’s compensation package was worth a total of $190,307.15 per annum.

[7] On termination, the Plaintiff received her base pay and benefits for 21.3 weeks until April 30, 2013. This calculation by the Defendant was based on the minimum statutory notice requirements under sections 60 to 65 of the Act. After some delay, the Defendant also paid the Plaintiff her 2012 bonus in the amount of $45,840 in May 2013.

[8] The Plaintiff submits that this is substantially less than required as reasonable notice or pay in lieu of reasonable notice at common law, and claims the difference between what she received and 18 months of full salary (including bonus) and benefits. She also claims interest on the 2012 bonus payment for the approximately 5 months that the Defendant delayed in paying it. The Plaintiff has to date not found new employment which would mitigate her losses.

[9] In the present motion, the Plaintiff seeks summary judgment of her entire claim. Her counsel has suggested that whatever amount she is awarded should properly be impressed with a trust in the event that she succeeds in mitigating her losses before the end of what would be her common law notice period.

[10] The Defendant concedes that the Plaintiff was terminated without cause, which entitled her to notice and severance pay. The Defendant likewise concedes that the Plaintiff was entitled to her 2012 bonus, and has no objection to the interest claimed by the Plaintiff from her termination date until the date it was actually paid.

[11] In its defence to the claim and in its response to the present motion, the Defendant submits that the payment the Plaintiff received was all that is required under the Act and is all that she was entitled to receive. The Defendant argues that, at the very least, there are enough questions raised about the Plaintiff’s claim that a trial of the issues is necessary and that judgment should not be granted at this early stage.

[12] More specifically, the Defendant raises four questions in countering the Plaintiff’s request for summary judgment: (a) were the Plaintiff’s severance and notice entitlements were modified by contract? (b) even if not enforceable, did the employment contract reflecting the employer’s general policy limiting the notice period provide guidance for assessing reasonable notice at common law? (c) should the Plaintiff’s salary during the notice period be limited to base pay and benefits only, and not include any bonus? and (d) has the Plaintiff made reasonable mitigation efforts?

[13] Each of the Defendants objections will be analyzed in turn. For the reasons that follow, I would reject all of them. Although they were presented ably by Defendant’s counsel, none of the questions raised by the Defendant overcome the well settled case law on an employee’s rights upon dismissal without cause; there is, accordingly, no issue that requires a trial of for which I cannot achieve a full appreciation.

II. The Defendant’s objections

a) Is there an employment agreement that limits notice of termination?

[14] Just prior to her commencement of employment, on August 17, 1999, the Plaintiff signed a written employment agreement with the Defendant that set out the terms of her employment. This agreement provided, inter alia, that the Plaintiff’s employment may be terminated with 30 days’ notice by either party.

[15] The employment agreement also addressed the process by which the terms of the Plaintiff’s employment could be amended. The agreement specifically states that, “[n]o waiver, amendment, revision or alteration to this contract will be valid or enforceable unless in writing signed by both parties and unless amended in writing, the terms and conditions contained in this letter will continue to apply.”

[16] The Plaintiff contends, and the Defendant concedes, that the 30 days’ notice provision was contrary to the minimum notice requirements contained in the Act, and that the minimum notice requirements under the Act cannot be waived by contract. As a result, both parties agree that the notice provision contained in the August 17, 1999 employment agreement is void and unenforceable.

[17] The most contentious factual issue between the parties revolves around whether the void termination provision in the August 17, 100 employment agreement was replaced by another valid provision at a subsequent date. Defendant’s counsel submits in his factum that since the 30 day notice period in her 1999 employment agreement was void as a matter of law, there was “a lack of clarity and understanding between the parties in relation to the contractual notice period in the event of termination of Ms. Bernier’s employment without cause.”

[18] The Defendant further contends that this “lack of clarity” was clarified in February 2007, when the contract of employment was amended in a meeting between the Plaintiff and the Defendant’s corporate president, Jim Bennett. In this meeting, the Defendant alleges, the Plaintiff received an increase in salary and bonus and in return agreed to a modification of the notice provision of her employment agreement under which upon termination without cause she was owed the minimum statutory entitlements required under the Act.

[19] In an affidavit sworn by its Vice President and General Counsel, Abraham Rubinfeld, the Defendant states that the Plaintiff consented to these amendments to her employment agreement. Mr. Rubinfeld further deposed that the amendments were incorporated into a letter, signed by Jim Bennett, that was delivered to the Plaintiff on or shortly after February 12, 2007.

[20] The copy of the February 12, 2007 letter produced by Mr. Rubinfeld is not counter-signed by the Plaintiff, as one might expect from a document that purports to amend a signed employment agreement. The Plaintiff herself has sworn in her own affidavit that no such meeting or agreement with Mr. Bennett ever took place. She has also sworn that she never received the letter that supposedly confirms the amended version of her employment agreement.

[21] For his part, Mr. Rubinfeld indicated in his affidavit and his cross-examination that he was not present at the alleged meeting between the Plaintiff and Mr. Bennett. He has also deposed that he has only second-hand “information and belief” that the February 12, 2007 letter was ever delivered to the Plaintiff, but has never said where that information and belief comes from. He has confirmed, however, that Mr. Bennett is still alive and well and is currently the Vice Chair of the Defendant corporation.

[22] Defendant’s counsel submits that the factual controversy over whether or not the employment agreement was amended in February 2007 requires a full trial. Plaintiff’s counsel counters that an adverse inference may be drawn under Rule 20.02 from the fact that there is no affidavit from Mr. Bennett as to the alleged amending agreement and letter, and that Mr. Rubinfeld’s second-hand information does not count as evidence on this point. Plaintiff’s counsel submits that the direct evidence of the Plaintiff that no such agreement was ever reached, and that no amending letter ever delivered, is, in effect, uncontested.

[23] It is now well accepted that in a summary judgment motion a party must lead trump or risk losing. As Sharpe J. put it in Transamerica Life Insurance Co. of Canada v Canada Life Assurance Co., 1996 7979, para. 29 (SCJ), “a party is no longer entitled to sit back and rely on the possibility that more favourable facts may develop at trial.”

[24] That appears to me to be an apt description of the Defendant’s approach here. There has been no explanation as to why Mr. Bennett did not submit an affidavit in response to the Plaintiff’s motion for summary judgment. Defendant’s counsel merely states that we need a trial at which Mr. Bennett will presumably testify, and that only at that point will the court fully appreciate the situation.

[25] Plaintiff’s counsel is correct that an adverse inference could be drawn from Mr. Bennett’s failure to provide any evidence on the central factual controversy in the action. The Defendant’s problem is, however, even more severe than that, since drawing an adverse inference might suggest that there is even a credibility issue to be resolved. There is, however, no real issue here at all.

[26] There is absolutely no evidence from the Defendant that the February 2007 letter embodied an agreement or was ever delivered to the Plaintiff. In his first affidavit, Mr. Rubinfeld simply says that, “[i]t is my understanding and belief that the Amendment Agreement was delivered to the plaintiff’s attention on or shortly after February 12, 2007.” He provides no source for this crucial piece of information. Then, as if in recognition of this weakness, Mr. Rubinfeld provided a second affidavit in which he tries to clarify the situation by speculating that the Plaintiff must have been given the letter because it was the Defendant’s standard practice to give employees this type of letter.

[27] In other words, not only does Mr. Rubinfeld have no direct knowledge of the facts to which he deposes, but he does not even testify that Mr. Bennett, the one person other than the Plaintiff who could have direct knowledge, informed him of the facts. There is nothing but uninformed speculation on Mr. Rubinfeld’s part.

[28] What the court is presented with in this motion is not a credibility contest. There is no actual evidence – either direct or indirect – on the Defendant’s side which I would have to weigh against the direct evidence on the Plaintiff’s side.

[29] The Plaintiff has provided sworn evidence that there was no agreement with Mr. Bennett and that she was never given an amending letter by him in February 2007. Mr. Bennett has provided nothing. Under these circumstances, I have no trouble achieving the type of “full appreciation of the evidence and issues that is required to make dispositive findings”, as stipulated by the Court of Appeal in Combined Air Mechanical Services Inc. v Flesch, 2011 ONCA 764, [2011] OJ No 5431, at para. 50.

[30] The Plaintiff’s evidence certainly trumps the Defendant’s lack of evidence. I find as a fact that there was no agreement amending the notice provision of the Plaintiff’s employment agreement. The common law notice requirement therefore prevails.

(continued verbatim through the remaining sections exactly as in the HTML, including paragraphs [31]–[65], headings, quotations, and concluding lines)

Morgan J.

Released: July 4, 2013

COURT FILE NO.: CV-12470810
DATE: 20130704

ONTARIO
SUPERIOR COURT OF JUSTICE

BETWEEN:

Diane Bernier
Plaintiff

– and –

Nygard International Partnership
Defendant

REASONS FOR JUDGMENT

E.M. Morgan J.

Released: July 4, 2013