ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-12-00444413
DATE: 20150807
BETWEEN:
VICKY KAREN STRUDWICK
Plaintiff
– and –
APPLIED CONSUMER & CLINICAL EVALUATIONS INC.
Defendant
Christopher Du Vernet and Carlin McGoogan, for the Plaintiff
Ernest Coetzee, for the Defendant
HEARD: May 14, 2015
REASONS FOR DECISION
G. DOW, J.
[1] The plaintiff seeks default judgment following the defendant’s unsuccessful efforts to set aside it having been noted in default. Justice Spence refused to set aside the noting in default in reasons dated March 10, 2014. The Court of Appeal refused to set aside that decision August 14, 2014 and leave to the Supreme of Canada was denied on or about March 3, 2015.
[2] Despite this motion being ex parte, counsel for the defendant attended, and with the acquiescence of plaintiff’s counsel, made limited submissions on the issue of appropriate pay in lieu of notice in this wrongful dismissal action.
[3] The facts surrounding the plaintiff’s wrongful dismissal (appreciating the plaintiff’s evidence is uncontested and the facts contained in the Statement of Claim are deemed to be true) can be summarized as follows.
[4] The plaintiff (born October 20, 1954) began working for the defendant September 4, 1995. Her duties involved data entry, and eventually instructing recruiting staff. The defendant is in the business of recruiting individuals to participate in focus groups. The plaintiff estimates the defendant, a private corporation owned by Ray Berta, employed approximately 70-80 employees and has revenue of about $5,000,000 per year.
[5] The plaintiff was earning $12.85 per hour at the time of her dismissal on May 27, 2011 or 15 years and 8 months after she began working for the defendant. The plaintiff’s Notice of Reassessment from the Canada Revenue Agency for 2010 indicates income of $21,802.
[6] A performance evaluation from 2007 indicates her performance was at level 4 or “exceeds established expectations”. Given the hourly wage and income for 2010, it is not clear how many hours per week she was working (although the math suggests less than 33 hours). It was her plan to work for the defendant, accepting cost of living increases (which she had been limited to previously), to age 65, or until October 20, 2021.
[7] The plaintiff reported to a Recruiting Supervisor, Liz Camilleri and the General Manager, Andrew Hoffman. She also had a modest benefit package, the cost of which to replace has been valued at $252.08 per month or $3,024.96 per year.
[8] Unfortunately, the plaintiff became deaf in October, 2010. She has been advised by her doctors that this is likely due to a virus. The uncontested evidence of the plaintiff was that her employer’s attitude towards her and treatment of her became unconscionable. The plaintiff deposed she was constantly belittled, humiliated and isolated.
[9] Further, she put forward requests such as the following:
(a) having the Canadian Hearing Society attend her place of employment and determine what optimal accommodations were required, which was refused by Mr. Hoffman;
(b) having important verbal instructions and information emailed or provided to her in print, which was refused by both Mr. Hoffman and Ms. Camilleri;
(c) accommodations as detailed and provided in a booklet published by the Canadian Hard of Hearing Association, some of which would have cost nothing to implement, and received no response;
(d) bringing a hearing dog to the workplace which was flatly refused by Mr. Hoffman. Of note, the owner, who is not disabled, often brought his own dogs into the office;
(e) reversing the direction of her desk to permit her to see people entering the office or approaching, which was refused;
(f) the purchase and use of TTY equipment or the installation of a voice carry-over telephone (which she offered to purchase on her own), which was refused without explanation;
(g) the installation of a visual fire alarm at her desk which the plaintiff offered to purchase herself, which was refused;
(h) assigning a person to notify her if the fire alarm went off, which was refused;
(i) continuing use of a vibrating pager given to her by the Canadian Hearing Society to test or an alternative flashing light model, which was refused.
[10] She was also subjected to having to reschedule medical appointments on short notice and was told by Ms. Camilleri (on occasions when she would look at her directly which would permit the plaintiff to lip read) “Why don’t you just quit? You can go on disability”.
[11] The plaintiff’s dismissal arose from her participation in Toastmaster’s Club, a voluntary group of employees that met at the defendant’s place of employment and was encouraged by the defendant. The plaintiff had belonged to the club before becoming deaf. During the week of May 26, the plaintiff was responsible for organizing the topics to be spoken on and was one of about 10 employees at the meeting. On this occasion, she did not select a topic from those she had prepared or speak on any topic the requisite one or two minutes.
[12] The plaintiff was confronted by Mr. Hoffman the next day, and, in front of an estimated 13 other employees was (she believes) yelled at and called “a goddamned fool”. A short while later Mr. Hoffman returned and asked her to accompany him to his office where she was joined by Ms. Camilleri and an employee named Sandy Byers. She was advised that she was being terminated for insubordination and wilful misconduct as a result of the “goddamned stunt” at Toastmasters the previous day.
[13] The plaintiff was provided a letter confirming her termination with a cheque for three months’ pay. Mr. Hoffman demanded she also sign an acknowledgment and waiver while placing his hand over the body of the document and (she believes) yelling at her to sign it. She refused and was not provided the cheque. She was told to get out of the premises, escorted to her desk and watched by Mr. Hoffman while she gathered her belongings (in plain sight of other employees).
[14] The situation was exacerbated by the conduct in the litigation when the defendant failed to serve or file a statement of defence between shortly after this claim was issued in January, 2012 up until the March 10, 2014 order of Justice Spence, a period of 21 months.
[15] The plaintiff’s efforts to mitigate involved her searching for another job immediately after termination. The plaintiff did not quantify the number of applications she has made but has attended four interviews, without success. In September, 2014, she obtained part-time employment with Community Care Mississauga working between zero and six days per month for $60 per day.
[16] The plaintiff did not receive her outstanding pay for work performed until Labour Community Services of Peel Region intervened. Further, the defendant tendered a record of employment to Employment Services of Canada advising she had been dismissed for insubordination and wilful misconduct. This delayed the plaintiff’s entitlement to receive employment insurance.
[17] The plaintiff tendered medical evidence from her treating psychiatrist and social worker. The diagnosis was an adjustment disorder with mixed anxiety and depressed mood as a result of the manner in which she had been treated by the defendant. The treatment proposed includes 18 months of weekly cognitive behavioural therapy with periodic reports to the treating family physician and psychiatrist at an estimated cost of $18,984.
Issue – Pay in Lieu of Notice
[18] Plaintiff’s counsel is seeking payment of the plaintiff’s wages to age 65 or an additional 8 years and 5 months (or to October 20, 2019). The material filed appears to incorrectly refer to the plaintiff’s years of service with the defendant as “nearly 18 years” when, based on the September 4, 1995 hire date, it is actually 15 years and 8 months. The proposed retirement date of October 20, 2021 also appears to be incorrect as it is actually October 20, 2019 assuming Exhibits R and S accurately reflect the plaintiff’s birthdate as October 20, 1954.
[19] Plaintiff’s counsel’s submission was based on:
(a) the plaintiff’s plan to work for the defendant to age 65;
(b) the lack of a reference letter being provided and the plaintiff’s deafness making it “highly unlikely” she would find alternate full-time work despite her ongoing efforts to do so;
(c) it is now 4 years that the plaintiff has been seeking full-time employment, without success.
[20] The state of the law at present is that the appropriate range for reasonable notice has no limit or “cap”. This was noted in Abrahim v. Sliwin, 2012 ONSC 6295 at paragraph 23 quoting Di Tomaso v. Crown Metal Packaging Canada LP (2011), 2011 ONCA 469, 337 D.L.R. (4th) 679 (Ont.C.A.) This decision also, at paragraph 24, cited how the “character” of the employment, in other words, greater notice for highly skilled positions and less notice for clerical or unskilled work, is now “largely irrelevant”: citing Love v. Acuity Investment Management Inc. (2011), 2011 ONCA 130, 89 C.C.E.L. (3d) 157 (Ont.C.A).
[21] The circumstances at hand places the plaintiff at the highest level for the number of months of notice. In my view, in the totality of the circumstances, that should be and will be awarded at 24 months. Reference should be made to counsel for the defendant, in his limited submissions, and reliance on the Court of Appeal decision from 2004, Montague et al. v. Bank of Nova Scotia, 2004 27211 (ON CA), [2004] O.J. No. 13, where the employer’s conduct was described as precipitous and in bad faith (at paragraph 14) and the award of 16 months was not disturbed. The employer’s horrendous conduct in this matter warrants recognition of an award at the 24-month level.
[22] In submissions, reference was made to the Supreme Court of Canada decision in 1997, Wallace v. United Grain Growers Ltd., 1997 332 (SCC), [1997] 3 S.C.R. 701, where, at paragraph 130, the Court concluded that where an employer dismisses an employee in a manner that negatively affects the employee’s chances of finding alternative employment, a Court may properly increase the employee’s period of reasonable notice to reflect that increased difficulty. In this instance, the employer’s conduct with regard to completing the plaintiff’s record of employment and making it more difficult for her to obtain employment insurance benefits results in the conclusion that 24 months is an appropriate amount. Further, the nature and manner of the plaintiff’s dismissal, including what occurred when Mr. Hoffman began shouting at the plaintiff before summonsing her to his office and his treatment of her in his office, must be considered. Had those events not occurred, the award would have been only 20 months.
[23] Plaintiff’s counsel noted the case law that such a lump sum should reflect salary increases that would have been offered to the plaintiff. There is difficulty with the plaintiff’s evidence of $0.75 - $1.75 annual raises when compared to her actual hourly rate at the time of dismissal, $12.85. That is, having been employed with the defendant for more than 15 years, one would have expected her hourly wage to be significantly in excess of $12.85 per hour if she was receiving the type of annual raises alleged. However, I am prepared to accept 2 percent cost of living increases. Using the 2010 Canada Revenue Agency Notice of Reassessment income figure of $21,802, the award for payment in lieu of notice would be 1.02 percent greater or $22,238.04 for the first 12 months, $22,682.80 for the second 12 months, for a total of $44,920.84.
[24] Plaintiff’s counsel also put forward a claim for recognition of the increased tax burden this lump sum will attract providing 2014 personal-combined (Ontario/Federal) rates. Applied to the plaintiff’s situation, there appears to be a differential of 11.1 percent (31.15 percent as opposed to 20.05 percent rate on taxable income) which results in a gross up for taxes of an additional $4,986.21.
[25] The total award for payment in lieu of notice becomes $49,907.05.
Issue - Fringe Benefits
[26] Plaintiff’s counsel also sought compensation for the loss of the collateral benefits that accompanied the plaintiff’s employment and tendered evidence that the cost of replacing these benefits was $252.08 per month or $3,024.96 per year. For the 24 months’ payment in lieu of notice that has been awarded, this amount becomes $6,049.92 and this will be included in the award. This award is in accord with the decision of Justice Barr in Boole v. Teron International Urban Development Corp., [1985] O.J. No. 600 at paragraph 45.
Issue – Human Rights Code Violation
[27] The source of this Court’s authority to make an award of this nature is found at s.46.1 of the Code entitled “Civil remedy”. The plaintiff has met the requisite elements having commenced a civil proceeding not based solely on this infringement and proven she was discriminated against after October, 2010 when she became deaf. She suffered injuries to her “dignity, feelings and self-respect” as identified in the medical evidence and contrary to Ontario’s Human Rights Code, R.S.O. 1990, c. H. 19.
[28] The cases cited by counsel assessed these damages from a low of $2,000 to a high of $30,000. In a letter dated June 30, 2015 from plaintiff’s counsel I was directed to a recent Tribunal decision that provided a much larger award and dealt with sexual exploitation, which is not the situation at hand. The cases also note the award is compensatory in nature.
[29] Having only heard the plaintiff’s version of events which must be accepted, the key aspect of which was the defendant’s abject failure to consider or accommodate the plaintiff despite repeated, reasonable and varied requests for same. The fact that there is no evidence to contradict the defendant’s unconscionable conduct detailed (in paragraph 9) above results in the conclusion that, in all the circumstances, an award of $20,000 is reasonable and appropriate.
Issue – Infliction of Mental Distress – Aggravated Damages
[30] The elements and circumstances for an award of aggravated damages were reviewed in the Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419 decision. In paragraph 66, aggravated damages are described as compensatory damages which are part of breach of contract damages. They are to address “the additional harm suffered because of the way the contract was breached”. Relative to wrongful dismissal claims, they address employer conduct that is “unfair or is in bad faith”: at paragraph 66, citing the Supreme Court of Canada decision in Keays v. Honda Canada Inc., 2008 SCC 39, [2008] 2 S.C.R. 362 at paragraph 57. It is noted that the breach of an employment agreement will inevitably cause some mental distress and such distress and hurt feelings are not compensable.
[31] The focus is on the unfair or bad faith conduct. In reviewing the situation at hand, there is a concern over double recovery. That is, the injuries to the plaintiff’s feelings, her dignity, pride and self-respect have already been referred to and are the basis for the Human Rights Code violation award. Here, the focus is on the manner of the dismissal, that is the use of the Toastmasters meeting the evening before (which has never been explained) and the requirement by the defendant to have the plaintiff clean out her desk in front of coworkers while Mr. Hoffman stood by. This conduct, including what occurred when Mr. Hoffman began shouting at the plaintiff before summonsing her to his office and his treatment of her in his office, is included. However, this has been addressed in the amount awarded in lieu of notice. I also have difficulty in rigidly relying on some of the comments made by the Court of Appeal in Boucher given separate claims in that action were advanced against both the employer and the store manager. In the facts at hand, only the employer is named as a defendant and not either Mr. Hoffman or Ms. Camilleri. Further, although not in evidence before this Court, statements were made by counsel that Mr. Hoffman is no longer employed by the defendant and an action for contribution and indemnity may have been commenced against him.
[32] The tort of intentional infliction of mental suffering was addressed in Boucher, supra, by Justice Laskin. At paragraph 41 he identified the three elements to be proven:
The defendant’s conduct was flagrant and outrageous;
The defendant’s conduct was calculated to harm the plaintiff;
The defendant’s conduct caused the plaintiff to suffer a visible and provable illness.
[33] In reviewing the trial judge’s charge to the jury, Justice Laskin emphasized that the conduct was intended to produce the consequences or alternatively the consequences were known by the actor to be substantially certain to follow. Assisted by the absence of contested evidence and with Mr. Hoffman and Ms. Camilleri acting on behalf of the employer, this test appears to have been met with regard to the treatment to which the plaintiff was subjected after she became deaf until her dismissal. That is, regarding the claim for intentional infliction of mental distress, it is accepted the defendants’ conduct caused the plaintiff to suffer an adjustment disorder with mixed anxiety and depressed mood which requires psychological treatment. The evidence is that it will cost $18,984 for this treatment. That amount is to be awarded as part of the intentional infliction of mental distress damages.
[34] Regarding the claim for aggravated damages, no additional award should be made given the amount I am awarding for pay in lieu of notice, the Human Rights Code award, and the mental distress award. This, in my view, avoids double recovery.
Issue – Punitive Damages
[33] This aspect of the assessment of damages deals with the independent and actionable claim detailed by the Supreme Court of Canada in Whiten v. Pilot Insurance Co., 2002 SCC 18, [2002] 1 S.C.R. 595. At paragraph 94, the Court reviewed 11 points detailing the characteristics of punitive damages. I would emphasize the following:
(a) they are very much the exception rather than the rule;
(b) they are imposed only if there has been high-handed, malicious or highly reprehensible misconduct that departs to a marked degree from ordinary standards of decent behavior;
(c) their purpose is not to compensate the plaintiff but to deter the defendant and others from such conduct;
(d) the amount should be reasonably proportionate considering the relative vulnerability of the plaintiff;
(e) they are intended to mark our community’s collective condemnation (denunciation) of what happened;
(f) they are to apply only when compensatory damages are insufficient and should be assessed at an amount no greater than necessary to rationally accomplish their purpose;
(g) judges and juries have usually found that moderate awards of punitive damages, which inevitably carry a stigma in the broader community, are generally sufficient.
[34] In paragraph 113 of the reasons, the Court enumerates factors which influence the level of blameworthiness. In this regard, the defendant’s misconduct appears to have been deliberate and intended to make the plaintiff quit. It persisted for more than six months prior to her dismissal and, it would seem, for about two years after her dismissal. It is mitigated by the lack of effort to conceal the misconduct or any profit that resulted from the misconduct. The existence of a power imbalance is highly relevant.
[35] At paragraph 123 of Whiten, the Court states, “The key point is that punitive damages are awarded ‘if, but only if’ all other penalties have been taken into account and found to be inadequate to accomplish the objectives of retribution, deterrence and denunciation.” In submissions, counsel submitted the size and resources of the defendant are not a factor. However, in this regard, the Court would note reference in Whiten to the amount of the award in comparison to the assets of the wrongdoer.
[36] The award detailed above totals $94,940.97 and I consider this award to be insufficient in all of the circumstances, particularly with regard to the need to deter the defendant and others from such conduct. There is a duty on employers to accommodate individuals with disabilities. This is reinforced when the employee has years of competent service, as in this situation. Instead of supporting this loyal employee, the employer not only discriminated against her, but treated her in a harsh and demeaning fashion. Given the nature of punitive damage awards detailed above, the Court assesses the same in the amount of $15,000. Thus, the total award is $109,940.97. The plaintiff is entitled to pre-judgment interest with regard to the payment in lieu of notice award of $49,907.05 and the Human Rights Code violation award of $20,000 in accordance with the Courts of Justice Act, particularly s. 128.
Costs
[37] Counsel for the plaintiff submitted a draft bill in the amount of $148,866.40 on a partial indemnity basis and $179,625 on a substantial indemnity basis. The Court was advised this excluded the cost awards in the motion before Justice Spence, the appeal of that order and the leave application to the Supreme Court of Canada. In reviewing the bill, it appears an inordinate amount of time was spent in preparing the default judgment materials. It should be noted counsel for the plaintiff, in his factum and in submissions, requested an award in excess of $1,000,000 despite a Fresh as Amended Statement of Claim which contains a prayer for relief in an amount less than one-quarter of the award requested. It is noted the Motion Record contained 21 exhibits in the plaintiff’s affidavit and three additional exhibits appended to the affidavit of the social worker. The Book of Authorities cited 36 cases, rules and statutes. While additional time being expended to achieve a concise factum is very much appreciated, it does not appear counsel for the plaintiff and the 117-page, 313 paragraph effort achieved same. Mindful of the need for a proportionate assessment, the Court would exercise its discretion and fix costs in the amount of $40,000 inclusive of fees, HST and disbursements. That is a fair and reasonable amount and would have been in the reasonable contemplation of the parties. This amount is consonant with the principles set out in Boucher et al. v. Public Accountants Council for the Province of Ontario et al., 2004 14579 (ON CA), [2004] O.J. No. 2634 and Rule 57.
[38] These reasons were reviewed following receipt of correspondence from plaintiff’s counsel dated May 20, May 21, June 23, June 30, and July 23, 2015 and from counsel for the defendant dated May 20 and June 5, 2015, all of which is acknowledged.
Mr. Justice G. Dow
Released: August 7, 2015
COURT FILE NO.: CV-12-00444413
DATE: 20150807
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
VICKY KAREN STRUDWICK
Plaintiff
– and –
APPLIED CONSUMER & CLINICAL EVALUATIONS INC.
Defendant
REASONS FOR DECISION
Mr. Justice G. Dow
Released: August 7, 2015