Court File and Parties

COURT FILE NO.: 14-CV-501730 Heard: April 14, 2016

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Wylie v. Canadian Specialty Metals ULC et al.

BEFORE: Master Joan Haberman

COUNSEL: Morse, J. R. for the moving party Bratt, A. for the responding party

REASONS

Master Haberman:

[1] On April 14, 2016, I heard and granted this motion to amend the Amended Statement of Claim, with Reasons to follow.

THE ACTION - what the claim is about

[2] The action involves a claim for wrongful dismissal. Wylie alleges he was employed by the defendant, ASA Alloys (“ASA”) from March 19, 1984 until his termination from employment on May 17, 2112, during which time ASA grew from an employer of three to a business with seven locations across the country.

[3] In 1987, he was promoted to Inside Sales, a position he filled until his employment was terminated, earning $85,000 per year at his peak.

[4] Wylie is candid about is personal problems, stating that he has suffered from alcoholism and depression for many years. ASA was aware of this, and allowed him to take paid leave for addiction and mental health treatment in 2002, 2005 and again in 2009. In 2010, following his third treatment program, new medication was prescribed for Wylie which improved his condition.

[5] Around that time, however, Wylie was transferred from the Toronto office to Sarnia, where he reported to the defendant, Randy Crowder. Wylie alleges that Crowder had a volatile temper and that he abused him verbally. It is his position that this led to the return of his depression and anxiety. He claims that by 2012, after two years of sobriety, he started drinking again.

[6] On February 21, 2012, Wylie was placed on unpaid leave and asked to provide a doctor’s note to explain his absences. Although Wylie had discussed his depression and anxiety with his family doctor, the latter informed him that he would need to see a psychiatrist for such a note. ASA was so advised, Wylie indicating that the note would be provided as soon as he could get one.

[7] On May 17, 2012, Wylie was informed that his employment was terminated for just cause. A week later, on May 25, 2012, he obtained the requested note and sent it over to ASA. The doctor confirmed that his absence from work since February had been for medical reasons and that he would be able to return on June 30, 2012. ASA, however, maintained their position and refused to reinstate Wylie on receipt of the note.

[8] Wylie alleges that his depression and anxiety worsened after his dismissal and that he became suicidal. He was no longer able to afford the medication he needed for his ailments and has now lost the ability to work at all.

[9] Wylie pleads that ASA breached the actual and implied contract of employment with him in several ways. One of them is found at paragraph 16(d) of the pleading, where it is alleged that they failed to provide benefits during the notice period.

THE PROPOSED AMENDMENTS

[10] There are three of them. The plaintiff proposes to amend paragraph 1(a) to increase the prayer for relief to $500,000. He also proposes to amend paragraph 16(d) to read as follows (proposed changes underlined):

They failed to provide benefits during the notice period, including short-term and long-term disability benefits or prejudiced the Plaintiff’s right to such benefits by terminating his employment.

[11] Finally, Wylie seeks to add a new paragraph 18, to mirror the amendment he seeks to make to paragraph 16(d), as follows:

The Plaintiff claims damages for past short-term disability benefits and past and future loss of long-term disability benefits arising from his wrongful dismissal.

THE RESPONDENTS’ POSITION

[12] The respondents’ reasons for opposing the motion are set out in the affidavits of Josie Lee, VP, Human Resources of ASA and Gregg Cousins, President.

[13] Lee begins by affirming ASA’s position to the effect that Wylie was released from employment for cause as he failed to update the company on his condition and prognosis and to produce the requested medical documentation to support the request.

[14] ASA’s position is based largely on the operation of their group insurance plan. Lee claims that while he was employed by ASA, Wylie was eligible to participate in the group insurance program and that the plan provided long-term, but no short term, disability coverage. According to Lee, the insurer is solely responsible for adjudicating long-term disability claims and then paying those benefits, and that ASA has no financial responsibility at all for these payments.

[15] As Lee describes it, Premiums for inclusion in that policy are deducted from employees’ wages. Those not actively at work can maintain their coverage but in order to do so, they must remit premium payments to the insurance company or risk being terminated from the program.

[16] In a letter to Wylie, dated February 21, 2012, Lee informed him that he was on unpaid leave, raising several other subjects as well:

In addition, you may be eligible for government paid unemployment benefits and potentially long term benefits with thu (sic) ASA’s’ health insurance provider. Please note that the company has no control over whether these benefits are granted and it will be your responsibility to determine if these benefits are applicable.

[17] The name and contact details of the health care insurer were not mentioned in the letter, nor was a form enclosed to facilitate this process.

[18] Lee states that, although on unpaid leave, Wylie was still employed by ASA at that time, so eligible to apply for LTD benefits. She states that she wrote to him again on March 8, 2012, reminding him that he was responsible for paying his premiums of $103.71 per month. Although she indicated that she needed the payment that week, this letter appears to have been sent by ordinary mail.

[19] Although Lee heard nothing further from Wylie, ASA paid the premium for that month. A further letter was sent to Wylie on April 23, 2012, in which he was asked to submit a cheque in the amount of $207.42, to cover premiums for March and April 2012, and advising him that if he failed to comply, his policy would lapse. Wylie neither responded nor made arrangements to make the payment.

[20] A third and final letter went to Wylie on May 9, 2012, sent again by ordinary mail, advising him that unless he provided the requested medical documentation by May 16, 2012 – only a week later, his employment would be terminated. This left a period of one week for the letter to get to Wylie and for his response to get back to Lee.

[21] Wylie was also told at that time that ASA was no longer going to cover his insurance premiums so that the policy would no longer be in force as of [last day for which his premium is currently paid by the Company, or Wednesday, May 16, 2012 whichever comes first]. It is not clear what date Lee was referring to in the first part of the phrase, so I am at a loss to understand how Wylie was expected to understand it.

[22] As nothing further was heard from Wylie, Lee instructed the insurer to terminate his coverage effective May 16, 2012. The following day, Wylie’s employment was terminated.

[23] Lee’s evidence is bolstered by that of Gregg Cousins, ASA’s president. He essentially repeats what Lee had to say and added two new pieces of information. First, he pointed out that it had not been clear to him that the plaintiff was also seeking damages from ASA for loss of past and future disability payments under the LTD plan when he reviewed the current version of the pleading.

[24] Cousins went on to say what he would have done had been aware that the claim extended in that direction. He claims he would have:

a) Requested current and ongoing medical documentation from the plaintiff’s treating physicians; b) Provided copies of same to the insurer and request that they conduct a detailed review in order to determine whether the plaintiff qualified for LTD benefits; and c) Insisted that the plaintiff undergo an independent medical examination to assess his eligibility for LTD benefits.

[25] Cousins added that ASA cannot now go back in time and take these steps, such that the company’s ability to defend this claim, if it is added, would be significantly compromised. Cousins does not say why he did not reinstate Wylie’s employment when ASA did receive the requested medical note only a week after termination. Had that occurred, all of the above steps could have been undertaken at that time.

[26] Most of what Lee and Cousins discuss in their evidence goes to the merits of the claim – whether or not Wylie was aware that he would lose access to the LTD policy, his lack of response and how ASA relied on that as a basis for dismissing him. For the most part, that evidence is not relevant in the context of a pleadings motion.

[27] What does have to considered, however, is Cousin’s evidence regarding ASA’s alleged prejudice.

THE LAW and its application to THE FACTS

[28] The plaintiff relies on Rule 26.01 of the Rules of Civil Procedure, a mandatory procedural Rule which requires the court to grant amendments unless doing so would cause prejudice to a defendant that could not be remedied by costs or an adjournment.

[29] A long line of cases has added to that legislative proviso, such that all proposed amendments must also be legally tenable before leave to amend will be granted. Factual accuracy is not the issue at this stage of the inquiry – all proposed facts are deemed capable of being proven for the purpose of the motion. As a result, the focus of the motion is on whether the facts pleaded, if proven, give rise to a claim that is legally viable.

[30] One area that falls within the rubric of the debate in this regard involves proposed amendments that raise new causes of action beyond the expiry of a presumptive limitation period. It is alleged that that is the case here, so an examination of what the proposed amendments are in the context of the law is critical.

[31] Case law makes it clear that a new cause of action is not asserted where the proposed amendment:

a. sets out an alternative claim for relief arising from the same set of facts; b. amounts to a different legal conclusion from facts already pleaded; or c. provides particulars of allegations already pleaded (see Martin v. St. Thomas Elgin Hospital, 2016 CarswellOnt 235).

[32] In Fitzpatrick Estate v. Medtronic Inc., [1996] OJ No. 2439, the court held that when substantially all of the material facts giving rise to the “new cause of action” have been pleaded that there is no new cause of action added.

[33] Similarly, in Randolph v. Graye, [1995] O.J. No. 777, Lane, J. allowed an amendment, noting that the new plea is of a different legal conclusion drawn from the same set of facts.

[34] In Denton v. Jones (No. 2) (1976), 14 OR (2d) 382, Grange J. allowed amendments, where the amendments pleaded legal consequences that flowed from the facts as opposed to a new cause of action. A similar result was reached in Jane Doe v. Canada (Attorney General), 2015 ONSC 4203, where the court held that an amendment should be permitted where it proposes a different legal conclusion from the same set of facts.

[35] It is clear, in the context of wrongful dismissal actions, that a plaintiff whose employment has been terminated can sue for lost salary as well as for all pecuniary losses that flows from his dismissal (see Davidson v. Allelix Inc., 1991 CarswellOnt 933). STD and LTD benefits have been included in the loss calculations (see Brito v. Canac Kitchens, 2012 ONCA 61).

[36] In Brito (supra), the Court of Appeal held that for an employee to succeed in a claim for entitlement to benefits, he must satisfy the onus of proving that he would have qualified for them under the terms of the policy, in other words, he must establish that he was totally disabled during the qualifying period so that he was incapable of working.

[37] There, the plaintiff had expressly pleaded that he was totally disabled at the time of, before, and following his termination and that he continued to be incapable of returning to work. The proposed amendments did not seek to add to that factual matrix, but rather, to claim reference to his entitlement to past and future STD’s and LTD’s as a result of the facts as pleaded. The case is therefore, in many respects, not dissimilar to the one at Bar.

[38] The court held that the amendment constituted a legal consequence that directly follows the facts as pleaded, and, on that basis, granted leave.

[39] I have already outlined above what the proposed amendments are. A closer look at the pleading, as it currently stands, is in now in order.

[40] The plaintiff has already pleaded the following:

• He claims for breach of the Human Rights Code, RSO 1990, Ch. 19 (paragraph 1(b));
• ASA was always aware of his disability and supported him by giving him three paid leaves of absence when he went for treatment in 2002, 2005 and 2009 (paragraph 7);
• Wylie had informed Josie Lee, the VP, Human Resources of ASA, of his struggles with depression and anxiety but ASA Sarnie failed to provide any accommodation or support for his condition (paragraph 12);
• After his termination, Wylie’s anxiety and depression worsened and he became suicidal. He was no longer able to afford his medication, and as a result of his untreated depression and anxiety, he has been totally incapable of working since he was terminated (paragraph 15);
• The defendants breached the actual and implied employment contact in that… they failed to provide benefits during the notice period;
• Section 60 of the Employment Standards Act, 2000 required the employer to continue to make whatever benefit plan contributions needed to maintain the employee’s benefits during the notice period (paragraph 17);
• His rights under the Human Rights Code were infringed when ASA terminated him after he required medical leave as a result of a disability (paragraph 20).

[41] For the purpose of this exercise, the court accepts that the allegations in pleading are capable of being proven. On that basis, Wylie asserts that his depression, anxiety and related alcoholism have been a long term issue for him, one which ASA was well aware of. He claims that Josie Lee was informed of his struggles when they reappeared in Sarnia. Despite that, on the evidence, Lee’s last letter to him gave him one further week only to repay missing premiums and come up with the medical letter they were seeking. This letter appears to have been put into ordinary mail.

[42] Wylie’s condition was something far less tangible than a broken leg or a bad case of the flu. His family doctor was not prepared to write the necessary note and told him he needed to get the input of a psychiatrist. I can take judicial notice from my work here and from keeping current as to the state of access to health professionals in this province that access to psychiatric assistance is not a fast or easy process in this province. As difficult as it can be in a major centre such as Toronto, I imagine that being in a small centre like Sarnia only exacerbates the problem.

[43] Wylie alleges that his issues were (and continue to be) depression and anxiety. Again, it is not surprising that he was not on top of his game and did not respond to letters from his employer.

[44] But there are issues to be dealt with at trial – they go to the merits of the action, not to the merits of the motion.

[45] Based on what Wylie has already pleaded, I am of the view that he is not seeking to add a new cause of action. With respect to both paragraphs 16(d) and 18, having already pleaded the failure to provide benefits, he now seeks to add particulars as to what those benefits consist of – past STD as well as past and future LTD’s.

[46] Further, to the extent that there is anything here that is new, it is a head of damages, not a ground of liability or a cause of action. It flows from Wylie having already pleaded that he has been totally incapable of working since his termination, and that ASA failed to provide benefits. At most, it is a different consequence or an alternate claim for relief arising from the same facts already pleaded, to the effect that his employment was wrongfully terminated and that, as a result, he has suffered a variety of damages.

[47] In their factum, ASA maintains that if these amendments are permitted, they will suffer irreparable prejudice. Unfortunately, they say that nowhere in their evidence. Though Cousins speaks of what he would have done had he known about these claims earlier, he does not discuss this in the context of prejudice.

[48] It is pleaded that ASA was well aware of Wylie’s issues generally and had supported him through three leaves of absence as a result. For some reason, he was moved to the Sarnia office soon after his last recovery, where his symptoms returned. Again, it is pleaded that Lee was made aware that his issues had returned.

[49] Instead of undertaking the kinds of things Cousins now says he would have done had he been aware of the nature of Wylie’s claims, Lee sent Wylie a series of letters with very short turn-around times, the final one dated only one week before the deadline she arbitrarily set. She had to know it would not be possible for Wylie to receive the letter by mail and respond to it by mail in the allotted time, but that is her evidence. Lee then relied on the lack of response as a basis for not simply terminating Wylie’s employment but for termination for cause, resulting in Wylie’s immediate loss of insurance coverage and, hence, his loss of access to the funds required to purchase the medication he needed. While much of this will be determined on the basis of evidence at trial, for now it is enough to say that, based on Lee’s letters, there was an alternate route available to the employer. Instead of dismissing Wylie for cause, they could have undertaken reinstated him when they received the doctor’s letter only one week later and undertaken the three steps Cousins now says he would have undertaken had he known this kind of claim was going to be made. The question is: why was the employer not proactive? In view of Wylie’s history with the company they had to have some inkling as to what was going on with him at this juncture, yet they let it play out to the point that he was then dismissed for cause.

[50] Instead of extending a hand to assist Wylie by taking the time to learn more about his condition, they simply sent him a series of threatening letters with one-week deadlines. Instead of anticipating that there would be an LTD claim, in view of Wylie’s history, ASA chose to dismiss Wylie and to do so for cause, leading to his loss of benefits. As a result, to the extent that they claim, in their factum, that they will suffer irreparable prejudice if the motion is granted as they have lost the opportunity to conduct their own investigation, they are, in my view, the authors of their own misfortune.

[51] ASA also relies on the decision of Herman J. in Rejdak v. Flight Network Inc., 2008 CarswellOnt 4521, for the proposition that the plaintiff was not entitled to benefits. In that case the plaintiff claimed benefits lost as a result of having been wrongfully terminated before completing his eligibility period for benefits. While the court held that he would have been entitled to such benefits had he remained employed for the notice period, he had failed to quantify those benefits.

[52] Redjak was a trial decision, not a pleadings motion, so of assistance to ASA here.

[53] I see no basis for disallowing any of the amendments sought. The arguments made regarding the increased prayer for relief was tied in with the rest, as proof, according to ASA, that the plaintiff did not have this benefit in mind when he pleaded so cannot now claim it. In my view, ASA has a very restrictive view of the law dealing with pleading amendments and I do not accept it.

[54] On the basis of all of the foregoing, the motion is granted in its entirety and leave to amend as proposed is hereby granted. The costs of the motion are to the moving party, fixed at $9163.60, and payable within 30 days. The number was clearly within the reasonable contemplation of both parties, at the defendant’s partial indemnity account exceeds this number by more than $7000.

(original signed) Master Joan M. Haberman Released: June 22, 2016