Court File and Parties

Citation: Nemirovski v. Socast Inc., 2017 ONSC 5616 Court File No.: CV-16-556674 Date: 2017-08-17

Superior Court of Justice - Ontario

Re: Nathan Nemirovski, Plaintiff And: Socast Inc., Defendant

Before: Madam Justice Jasmine T. Akbarali

Counsel: J. Pinkus, for the Plaintiff R. Boyd, for the Defendant

Heard: August 18, 2017

Endorsement

[1] Despite my endorsement of May 19, 2017, the defendant has failed to retain counsel, obtain an order to continue, or file any material on this motion. Despite Mr. Boyd’s lack of status to speak on behalf of the defendant, I agreed to hear from him.

[2] The plaintiff seeks summary judgment arising out of his wrongful dismissal by Socast.

[3] I am satisfied this is an appropriate case for summary judgment. The facts are not complicated nor in dispute. I can find the necessary facts and apply the law to reach a just and efficient determination of the issues raised in this motion: Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87.

[4] This is no dispute that the plaintiff was hired on September 22, 2014 as a product manager for $100,000.08 in salary plus benefits. He was terminated without cause on May 13, 2016, about 19 months later. At the time of termination he received two weeks pay but, contrary to the Employment Standards Act, 2000, S.O. 2000, c. 41, he received no benefits.

[5] The plaintiff’s employment was governed by two employment contracts, neither of which purported to contractually limit his entitlements on termination. He is therefore entitled to reasonable notice at common law: Machtinger v. HOJ Industries Ltd, [1992] 1 S.C.R. 986.

[6] The second employment contract did, however, subject the plaintiff to an onerous non-competition clause which prevented him from working in competition with Socast for 24 months anywhere in the world where Socast operated.

[7] At the time of his termination, the plaintiff was 40 years old. He had 19 months of service in a well-paid professional position. There is significant evidence of his efforts to mitigate, including by applying for at least 215 positions and participating in over 30 job interviews. It took the plaintiff 9½ months to find alternative employment. He is now making about $15,000 less than he did at Socast. I infer from this evidence that the availability of alternative employment in his field was poor. I note also that Socast provided no reference letter for the plaintiff.

[8] There is also evidence that the plaintiff lost a job opportunity as a direct result of the non-competition clause, even in the face of the plaintiff’s counsel’s advice that the clause would be found to be overbroad and unenforceable being communicated to the prospective employer.

[9] The plaintiff has provided a chart at pp. 12-13 of his factum setting out cases applying the Bardal factors to other short-service employees. He seeks nine months’ notice in this case, which he admits is on the high end of the range.

[10] However, counsel argues that the failure of Socast to provide a reference letter warrants a lengthier period of notice: Beth v. Advanced Micro Devices Inc., [2007] O.J. No. 5646, aff’d 2008 ONCA 686, [2008] O.J. No. 3911.

[11] Counsel also argues that the oppressive non-competition clause warrants a lengthier notice period: Murrell v. Burns International Security Services Ltd., [1994] O.J. No. 1019 (Gen. Div.); Munoz v. Sierra Systems Group Inc., 2016 BCCA 140, [2016] B.C.J. No. 607.

[12] I accept that in view of the Bardal factors as I have described them, the non-competition clause, and Socast’s failure to provide the plaintiff with a reference letter, the plaintiff is entitled to notice at the high end of the range, that is nine months notice plus a corresponding amount for benefits.

[13] The defendant has not challenged the plaintiff’s efforts to mitigate, nor could it reasonably do so. The evidence establishes that the plaintiff made significant efforts to locate new employment.

[14] I accept counsel’s calculation of damages at para. 58 of the plaintiff’s factum. The plaintiff is entitled to $78,333.40 representing nine months notice plus benefits estimated at 10% of salary for that time period. The defendant has failed to provide any evidence of the value of the plaintiff’s benefits. Ten percent of the value of the salary is a reasonable estimate in the circumstances: English v. Alcatel Networks Corp., [2002] O.J. No. 2398.

[15] The plaintiff also seeks leave to amend his statement of claim to increase his claim for damages and plead additional material facts. I can see no reason not to grant the amendment and the defendant had raised none. Accordingly, leave to amend the pleading is granted.

[16] I note that Mr. Boyd submitted that the defendant is in fragile financial circumstances. That may be the case but that is not a reason to dismiss the plaintiff’s motion or alter the notice period: Michela v. St. Thomas of Villanova Catholic School, 2015 ONCA, [2015] O.J. No. 6092.

[17] The plaintiff seeks costs on a substantial indemnity scale, referencing three offers it made and has beaten, including a very early offer which was not a r. 49.10 offer, although I can consider it under r. 49.13 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.

[18] The plaintiff also made a r. 49.10 offer in January 2017 which it has beaten.

[19] The plaintiff argues that the conduct of the defendant in being non-responsive to the litigation unnecessarily increased his costs.

[20] I accept that costs have been increased by the defendant’s conduct. I also accept that costs consequences flow as a result of the r. 49.10 offer served in January 2017.

[21] The plaintiff is entitled to his partial indemnity costs to January 11, 2017 and his substantial indemnity costs thereafter.

[22] After disbursements and HST, I calculate the amount claimed on this reduced basis (i.e., partial indemnity to the date of the r. 49.10 offer and substantial indemnity thereafter) to be $16,036.38. This amount excludes the amount awarded in May 2017, on the first hearing of this motion and the associated time.

[23] Costs must also be fair and reasonable, keeping in mind the reasonable expectations of the unsuccessful party, the principle of indemnity and the other factors laid out in r. 57.01 of the Rules of Civil Procedure.

[24] This action has involved pleadings, a mediation, preparation of affidavits of documents, preparation of a very thorough motion record and today’s attendance. In my May 19, 2017 endorsement I noted the defendant’s lack of participation in this action. The plaintiff has been disadvantaged by that in the form of additional costs as counsel had endeavoured to engage Socast.

[25] Accordingly it is my view that costs of $16,000 inclusive of HST and disbursements are fair and reasonable in the circumstances.

Akbarali J.

Date: August 18, 2017.