SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 13-CV-472483
DATE: 20140121

RE: John Kline, Plaintiff

AND:

Lafarge Canada Inc., Defendant

BEFORE: Carole J Brown J

COUNSEL: Aaron Rousseau, for the Plaintiff

Stephanie Jeronimo, for the Defendant

HEARD: January 8, 2014

ENDORSEMENT

[1] This motion for judgment in terms of an accepted offer to settle and damages for breach of the accepted offer is brought by the plaintiff within the context of an action commenced by the plaintiff for wrongful dismissal in January 2013.

The Facts

[2] The plaintiff was employed by the defendant for a number of years. The plaintiff had been relocated from the United States to Calgary for his employment. Due to company restructuring, the plaintiff's employment was terminated without cause effective June 30, 2012. The plaintiff was provided with one month's working notice and was offered a severance package, which was not accepted.

[3] On June 30, 2012, following the termination, the defendant voluntarily commenced salary continuation payments to the plaintiff, inclusive of his statutory notice entitlement. The parties entered into settlement discussions following the plaintiff’s termination, which extended for approximately 12 months. During this time, the plaintiff continued to pay the salary continuation payments.

[4] As part of the settlement, the plaintiff sought to participate in, and the negotiations focused in large part on, the plaintiff's eligibility to participate in the defendant's relocation policies, which were administered by the relocation services provider, Weichert Workforce Mobility ("Weichert"). These policies provide an employee who is being relocated with the assistance of a relocation counselor, to assist with the purchase of a new home and the selling of an existing home. Further, the policies provide for the payment of reimbursement for certain specified expenses, subject to certain conditions, and the provision of several bonuses and allowances, including a "settling-in allowance" and a "home sale bonus".

[5] The plaintiff commenced this action on January 23, 2013.

[6] On April 5, the plaintiff served the defendant with a Rule 49 offer to settle, with Minutes of Settlement appended.

[7] After further negotiations with respect to the form and content of the Minutes of Settlement and the quantum of costs to be paid, the plaintiff accepted the amended settlement offer. The Minutes of Settlement and Release were signed by the plaintiff on June 25, 2013 and provided on that day by electronic copy to the defendant, with a hard copy provided on July 10, 2013 and received by the defendant's counsel on July 11, 2013. The hard copy was countersigned by the defendant on July 22, 2013 and provided to the plaintiff's counsel on July 23, 2013. The defendant indicated that their policy required a hard copy of the original settlement documents for execution.

[8] The Minutes included provisions for: salary continuance, vacation pay, lump-sum payments on account of various allowances, a bonus, payment for legal fees and disbursements, outplacement services, relocation services and income tax preparation. As part of the settlement, the defendant agreed that the plaintiff, who had been relocated from the United States, would be relocated back to the United States at the defendant's expense pursuant to the company relocation policy. In this regard, paragraph 18 of the settlement agreement stated as follows:

The Employer will pay for and the Employee shall immediately be eligible to participate in the Canadian current Employee Relocation Policy… for his move from Canada and the current Employee Relocation Guide for US Domestic Moves… for his move into the United States. To be clear, the Canadian policy is for his departure and the US policy is for his arrival. There are no duplicate collections for the same issue or matter. The employer confirms the move is due to a termination without cause. The employer will reimburse the employee for any costs that have already been or will be incurred by the employee that cannot be covered by the normal relocation policies due to timing issues. Any costs incurred by the employee for any payments that would have been taxable as covered by the policy shall be grossed up to be tax equalized to the employee.

[9] I note that absent the Minutes of Settlement, the plaintiff would not otherwise have been eligible for relocation costs as, pursuant to the company policy, in order to obtain relocation costs, an individual must be an employee of the company at the time of relocation.

[10] At the time the Minutes of Settlement were countersigned by the defendant on July 22, 2013, the plaintiff immediately received payment pursuant to the Minutes of Settlement in the amount of $111,153.99, plus legal fees in the amount of $18,000. All of the payments were made within the stipulated time in the Minutes of Settlement. Semi-monthly payments for salary continuance, car allowance and an expatriate expense allowance, coverage for dental and health benefits, group life and accidental death and dismemberment, insurance coverage and pension membership were to continue through July 31, 2014 or the date of new employment. Outplacement services, relocation services and income tax preparation were issues outstanding. The Minutes of Settlement did not stipulate a timeframe for completion of these items.

[11] Following termination, the plaintiff purchased a home in Allentown, Pennsylvania. Following acceptance of the offer to settle, the plaintiff listed his home in Calgary for sale on July 16, 2013 contrary to the provisions of the relocation policy. However, the defendant granted an exception as regards the broker selection process and permitted him to continue with the listing of the Calgary property.

[12] On July 23, the day following the defendant's countersigning of the hard copy of the Minutes of Settlement, the plaintiff contacted Mr. Boucher, the Human Rights Manager for the defendant to request that his relocation expenses be paid directly by the defendant and not by their relocation counselor, Weichart. The defendant denied this in his supplementary supporting affidavit. Mr. Boucher states in his affidavit that he advised the plaintiff that this request would have to be looked into, as it appeared to be different from the terms agreed to pursuant to the Minutes of Settlement. He states in his affidavit that he also reminded the plaintiff that he had made specific inquiries that had to be looked into. He further advised that he would be away on a business trip the following weeks. Thereafter, he was on vacation with his family from August 12-23.

[13] On August 12, 2013, the plaintiff e-mailed Mr. Boucher, who was on vacation, as well as an Administrative Assistant with the defendant, to inquire about when he would be enrolled in the outplacement services, and reimbursed for his moving expenses and put in contact with a tax advisor. On August 15, Mr. Boucher e-mailed the plaintiff to advised that he was on vacation and would return August 26, at which time he would address the outstanding items. Also on August 15, the plaintiff was provided with the contact information for the outplacement services.

[14] On August 16, the plaintiff advised that he was not willing to proceed with the settlement. On August 20, the plaintiff advised that he would only proceed with the settlement if the defendant agreed to numerous additional payments not contemplated by the Minutes, including the damages now sought in this motion.

[15] The plaintiff imposed a deadline of August 30 in order to complete all of the provisions of the Minutes of Settlement. However, the evidence indicates that he was traveling at that time and had advised the defendant that he would be unable to participate in the relocation policy until September 20, as he was traveling from August 18 onward. It is the position of the defendant that, based on this, the plaintiff’s deadline of August 30 was not reasonable, and he could not have availed himself of the services to be provided until September 20.

[16] On August 26, Mr. Boucher returned to the office and continued to work on the completion of the outstanding issues, which were the relocation costs and income tax. From the defendant's point of view, there was no issue that they would not complete the settlement and, indeed, most of the amounts owing had already been paid within the timeframes stipulated by the Minutes of Settlement.

[17] Following his return, Mr. Boucher contacted Mr. Kline to advise him that the request for direct payment by Lafarge rather than through the normal channels of payment by Weichert, would be honoured. The plaintiff was enrolled in the program on September 4, 2013, and was contacted by Weichert on the same day.

[18] The plaintiff received an offer of purchase and sale of his home on October 21, which did not close. However, a subsequent offer was received and accepted, and the Calgary property sold on November 29, 2012. Pursuant to the relocation policies, the plaintiff's closing costs were paid by Weichert, as well as a $20,000 home sale bonus.

[19] In the plaintiff's motion materials, he took the position that he had incurred costs in relocation totaling in excess of $75,887, most of which were incurred prior to execution of the settlement agreement. At the time of the motion, the parties advised that the outstanding issues had all been resolved, except for the carrying costs sought by the plaintiff in the amount of $10,603.36, which the plaintiff states were incurred due to the delay in his being enrolled in the relocation program, which delayed his ability to sell his home. The costs included the cost of carrying his two homes until the Calgary home was sold, including mortgage interest, taxes, a line of credit, electricity, water, lawn, gas, insurance, Residents' Association, security and telephone.

The Issues

[20] The issues for determination on this motion are as follows:

1. Whether there was a breach of the settlement agreement;

2. Whether the plaintiff is entitled to any damages and, if so, in what amount;

3. Whether the plaintiff is entitled to his costs for bringing this motion.

4. Was there a breach of the settlement agreement

[21] The plaintiff's position is that the settlement agreement has not been complied with within the contemplated timeframe and that the plaintiff has incurred additional costs regarding his relocation following termination which costs he seeks from the defendant.

[22] It is the position of the defendant that there is no timeframe set out in the Minutes of Settlement, that the terms of the settlement have not been breached and that the motion is unnecessary. The defendant submits that it has complied with all terms of the settlement agreement and the plaintiff is not entitled to any additional damages. It is further the defendant’s position that the plaintiff is not entitled to costs of the motion, as it was brought unnecessarily.

[23] The plaintiff takes the position that the settlement agreement, clause 18, provides that the plaintiff shall immediately be enrolled to participate in the Canadian current Employee Relocation Program for his move from Canada and immediately reimbursed for his expenses. He states that he was not immediately enrolled or reimbursed, and did not immediately receive relocation services from the relocation provider, which delayed the sale of his home, as a result of which he incurred additional expenses in the form of carrying costs. He submits that this was in breach of the Minutes of Settlement and that, in consequence, he incurred relocation costs which were not covered by the defendant.

[24] It is the position of the defendant that the plaintiff's motion, in essence, relates to the timing of when he was enrolled in the defendant's relocation policies and the effect of this enrollment on the sale of his Calgary home. The defendant submits that the plaintiff was not, pursuant to the agreement, entitled to immediate enrollment and reimbursement, but rather, pursuant to the Minutes of Settlement, he was immediately eligible to participate in the relocation policies; i.e. that he was immediately eligible to benefit from the policies. It is the position of the defendant that being immediately eligible does not equate to immediate enrollment or reimbursement. It is further the position of the defendant that there was no timeline applicable to the settlement other than as stipulated in the Minutes of Settlement.

[25] It was the defendant's position that this was an unusual case, as the plaintiff had listed his home for sale outside the relocation program, and had already purchased a new home and moved into it. Moreover, as indicated above, the plaintiff was no longer an employee and was not entitled to the benefits of the relocation program until such time as the settlement agreement had been executed.

[26] The defendant submits that it acted reasonably, expeditiously and without delay throughout, given the issues involved. The plaintiff was advised when there would be a delay due to business trips, vacations or having to ascertain whether the plaintiff's additional requests could be met without breaching the terms of the settlement agreement. The defendant argued that the plaintiff imposed a deadline, namely August 30, which he himself could not meet, which was unreasonable. The defendant argues that this is ultimately a claim for additional damages.

[27] As regards the sale of the home, while the plaintiff submitted that the delay in selling the home and the costs incurred in carrying it were due to the delay in his being enrolled in the program, there was no evidence before me that the home would or could have sold sooner than it did, or that the plaintiff had received any offers in July and August, prior to being enrolled in the program, or could have sold the home at that time. Nor is there any evidence as regards the normal time delay between listing of a home in the Calgary market and selling it. The home was sold four months after it was listed. There is no evidence that the assistance of the relocation counselor, Weichart, could have resulted in a better or quicker sale.

[28] The defendant states that the plaintiff's house was listed for sale for the majority of the disputed period of time, but did not sell. The defendant notes that the Canadian Relocation Policy clearly provided that the plaintiff was required to consult with the relocation counselor prior to entering into any listing agreement. However, although the plaintiff had had the policy from December, 2012, after his termination on June 30, 2012, he nevertheless entered into a listing agreement for his Calgary property on July 14, 2013 without consulting the relocation counselor. I note that the defendant did grant him an exception with respect to the broker selection process pursuant to the Relocation policies and permitted him to continue with the listing of the Calgary property. Although the plaintiff's home had been listed for sale since July 16, it did not sell until November 29, 2013. The plaintiff's closing costs were paid by the defendant, including real estate commission, inspection/appraisal costs and legal fees and disbursements. The plaintiff received a $20,000 Home Sale Bonus.

[29] As regards the carrying costs sought by the plaintiff, which were set forth in the facta of the parties, the plaintiff seeks $10,603.36. The defendant states that, were carrying costs payable which, it argues, they are not, they would be in the amount of $7,623.37, as follows. Based on paragraph 18 of the Minutes of Settlement, there are to be no duplicate collections for the same issue or matter relating to the Relocation Policies. Based on the Relocation Policy, the plaintiff would be entitled to reimbursement for 30 days of mortgage interest and real estate taxes incurred on account of owning two homes. The value of this reimbursement is based on the lower of the two payments made for each home. As at November of 2013, the plaintiff had not provided documentation in support of this claim. The claimant was ultimately paid in the amount of $1,687.20, pursuant to the policy and documentary proof provided. Further, the line of credit sought is not covered, given that there is no evidence of reason or purpose for the line of credit. As regards the other expenses, the defendant submits that these costs are "settling in costs, which are not reimbursable, given that the plaintiff is entitled to an $8,000 offset, without requiring proof of expenditures, for purposes of settling in. The items listed by the plaintiff as carrying costs are all contemplated by this settling in allowance provision of the US Relocation Policy and the $8,000 US lump sum payment was provided to the plaintiff on October 16, 2013. It is the position of the defendant that the amounts claimed, excluding the non-covered line of credit, amount to $7,623.37 Canadian. The settling in allowance of $8,000 amounts to $8,276 Canadian, meaning that the plaintiff was ahead by $652.63.

[30] It is the position of the defendant that the plaintiff has been fully paid pursuant to the Minutes of Settlement. It submits that there has been no breach of the terms of the settlement agreement.

[31] Based on all of the foregoing, I do not find that there was a breach of the settlement agreement. The plaintiff was eligible to participate in the relocation program. I find that this is different from the position taken by the plaintiff that it was entitled to be enrolled and to receive reimbursement immediately. I further find that while there were timelines in the Minutes of Settlement for certain payments, there were no timelines for payment of the relocation costs. I find that the time period between the conclusion of the Minutes of Settlement and payment of the bulk of the settlement funds and the conclusion of the relocation issues was reasonable, where there might be a delay in a response from the defendant, it was clearly explained to the plaintiff and that there was no delay as regards the application of the relocation policy to the sale of the plaintiff's home which would justify a demand for carrying costs. Further, there was no evidence that the immediate participation of the relocation counselor may have expedited the sale of the plaintiff's Calgary home, nor that the four month time between listing and sale of the home was longer than normal. Any carrying costs which may have been incurred were paid pursuant to the Minutes of Settlement.

Is the plaintiff entitled to damages

[32] Based on the foregoing and my determination that there is no breach of the terms of the Minutes of Settlement, the plaintiff is not entitled to any damages. In the event that the plaintiff were entitled to damages, which I have found he is not, I accept the defendant's explanation with respect to the damages sought by the plaintiff as set forth in the charts produced by both the plaintiff and defendant and as set forth at para.29, above. I find that there were no additional damages which are or should be owing to the plaintiff.

[33] Based on the submissions of counsel, the evidence before me and all of the foregoing, I dismiss the plaintiff’s motion.

Costs

[34] Both counsel provided me with their costs outlines. Given my findings above, and taking into consideration the guidelines set forth at Rule 57.01, I find that the defendant is entitled to its costs on a partial indemnity scale in the amount of $9,087.46. I note that, in the plaintiff's cost outline, he had sought costs in the amount of $10,276.97 on a partial indemnity basis, such that the amount which I award to the defendant would have been within the reasonable expectation of the plaintiff in the event that he lost his motion, as is the case.

Carole J. Brown J.

Date: January 21, 2014