COURT FILE NO.: CV-14-517336
DATE: 20180525
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JASMINE THEBERGE-LINDSAY
Plaintiff
– and –
3395022 CANADA INC. O/A KUTCHER DENTISTRY PROFESSIONAL CORPORATION
Defendant
Ryan Kornblum & Josh Cummings, for the Plaintiff
Chris Dockrill, for the Defendant
HEARD: April 17 & 18, 2018
V.R. CHIAPPETTA j.
Overview
[1] This case re-visits the dichotomy between the entitlement of a long-time employee to reasonable pay in lieu of notice of termination and the ability of an employer to contractually limit its notice obligations. The background facts are not significantly in issue but are unique in the way they present the issue to the court.
[2] The plaintiff commenced work with Dr. Victor Kutcher as a dental hygienist in 1993. Dr. Kutcher is a dentist and periodontist practicing in Stoney Creek, Ontario. At this time Dr. Kutcher was practicing as an unincorporated sole practitioner. The plaintiff was not asked to nor did she sign an employment contract upon the commencement of her employment in 1993.
[3] In 1999, Dr. Kutcher decided to contract the services of his hygienists through a management company. 3395022 Canada Inc. (“339”) was duly incorporated as an Ontario corporation with Dr. Kutcher’s wife, Merren Kutcher, named as shareholder and officer and director. Mrs. Kutcher is a chartered professional accountant, holds a Masters’ in business administration and is a Master of taxation. She was at all materials times between 1993 and 2012, responsible for the accounting activities related to Dr. Kutcher’s practice.
Mrs. Kutcher testified that the sole purpose of 339 was to provide hygiene services to Dr. Kutcher. It was incorporated at a time when periodontists were not permitted to have their own incorporated professional management company. Mrs. Kutcher further testified that there was no value added by 339 but for the tax benefits and the ability to engage in income splitting. The only other shareholder of 339 was a trust the beneficiaries of which were the Kutchers’ children. Dr. Kutcher had signing authority for 339. He too testified that the reasons for incorporating 339 were solely related to tax benefits and the ability to engage in income splitting.
[4] On May 5, 1999, the plaintiff was presented with and signed an employment agreement between herself and 399 (“the 1999 agreement”). The 1999 agreement limited the liability of 399, should it terminate the plaintiff without cause, to notice or payment in lieu of notice in accordance with the Employment Standards Act, 2000, S.O. 2000, c.41 (“the ESA”). The plaintiff testified that she reviewed the agreement with Dr. Kutcher prior to signing it. Dr. Kutcher advised her not to worry about the termination provision as “it was never going to happen.” Dr. Kutcher admits that he reviewed the 1999 agreement with the plaintiff but denies that he made this statement. The 1999 agreement was not signed on behalf of the employer.
[5] Dr. Kutcher and the plaintiff agree that the terms and conditions of the plaintiff’s employment did not change upon her signing the 1999 agreement. Lynn Graham, a hygienist in Dr. Kutcher’s office since 1995, testified on behalf of the defendant. She too signed a similar 1999 agreement. She testified that Dr. Kutcher told her that there would be no changes to the terms and conditions of her employment as a result of the 1999 agreement. The only difference would be that her wages would be paid by 399.
[6] Mrs. Kutcher testified that she was the operating mind of 399. She stated that she made the final decision in terms of hiring hygienists. She admitted in cross examination however that other than preparing the required filings for the company, she was not engaged in the day to day business of 399. The evidence before the court demonstrates that for the time of 339’s existence, Mrs. Kutcher did not prepare or sign the pay cheques for the hygienists, she did not do the payroll, she did not intervene in the day to day performance of the hygienists, she did not conduct performance reviews, she did not conduct employment interviews, she did not prepare the records of employment or the T4 slips and she did not review the employment contract with the hygienists. These fundamental tasks were performed by Dr. Kutcher or his office manager, Leslie Feaver.
[7] Leslie Feaver testified on behalf of the defendant. Her evidence was that Dr. Kutcher managed the hygienists. At no time did she meet with Mrs. Kutcher about anything other than year-end accounting issues. She advised the court that the boss at all times was Dr. Kutcher. Lynn Graham similarly testified that all times she was managed by Dr. Kutcher and no one else. She rarely saw Mrs. Kutcher.
[8] By correspondence dated March 28, 2005 the plaintiff tendered her resignation to Dr. Kutcher effective July 7, 2005. She was engaged to be married to a gentleman who lived in Guelph, Ontario. The plaintiff had secured alternative employment in Guelph to be commenced after July 7, 2005. During the notice period and prior to her effective day of resignation, in or about May 2005, the plaintiff ended her engagement and advised Dr. Kutcher of her intention to remain employed as a dental hygienist working in his office. The plaintiff testified that Dr. Kutcher told her that he was pleased to hear it as he did not want her to leave.
[9] On June 30, 2005 the plaintiff was presented with and signed an employment agreement between herself and 399 (“the 2005 agreement”). The 2005 agreement limited the liability of 399, should it terminate the plaintiff without cause, to notice or payment in lieu of notice in accordance with the ESA. Again, the plaintiff testified that she reviewed the agreement with Dr. Kutcher prior to signing it. Her evidence is that Dr. Kutcher advised her not to worry about the termination provision as “it was never going to happen.” Dr. Kutcher denies he made this statement. Dr. Kutcher signed the 2005 agreement on behalf of 399. The plaintiff continued her employment with Dr. Kutcher without interruption between March 28, 2005 and June 30, 2005. There were no changes to the terms and conditions of her employment as a result of the 2005 agreement.
[10] Throughout the period of notice of resignation and prior to the effective date of resignation, Dr. Kutcher commenced the process of hiring a hygienist. He advertised the position for a cost of $365.94, received resumes and conducted interviews. All resumes presented to the court were addressed to Dr. Kutcher, not Mrs. Kutcher. No offers of employment were made as Dr. Kutcher testified that he was getting the sense from the plaintiff that things were not working with her fiancé.
[11] The total costs of the efforts to replace the plaintiff was $365.94. The plaintiff testified that this was not in vain however as another one of Dr. Kutcher’s hygienists resigned during this time such that he was in need of hiring a hygienist independent of the plaintiff’s decision to remain with him. Dr. Kutcher testified that the hygienist hired was not one who applied to the posting as advertised.
[12] In 2011, Dr. Kutcher decided to wind up the operations of 339 and to contract the services of his hygienists through his own professional management company, Kutcher Dentistry Professional Corporation, an entity incorporated and operated by Dr. Kutcher in 2006, after the laws changed to permit periodontists to incorporate their own management company. By correspondence dated October 11, 2011, Mrs. Kutcher advised the plaintiff that her contract with 339 would terminate December 31, 2011. A record of employment was filed in January 2012, stating the reason for termination of employment was that the “business closed.” The certificate of dissolution for 339 is dated May 7, 2012. At the commencement of trial, the plaintiff advised that the claim was being asserted only against Kutcher Dentistry Professional Corporation.
[13] On December 22, 2011 the plaintiff was presented with and signed an employment agreement between herself and Kutcher Dentistry Professional Corporation (“the 2011 agreement”). The plaintiff had to sign the contract prior to the end of the 2011 fiscal year end in order to continue employment. Prior to signing this contract, the plaintiff received independent legal advice and the draft contract was revised in part as a result of that advice, eliminating the section in the 2011 agreement obligating the employee to provide eight weeks’ notice of resignation failing which there would be a penalty imposed of $200 per day.
[14] The 2011 agreement was further revised to remove the obligation of the employer to pay eight weeks in lieu of notice upon a dismissal without cause, notwithstanding that the 2011 agreement limited the liability of Kutcher Dentistry Professional Corporation, should it terminate the plaintiff without cause, to notice or payment in lieu of notice in accordance with the ESA. Dr. Kutcher testified that he removed the eight-week obligation in the plaintiff’s contract as he was concerned about the plaintiff’s recent tendency to arrive late for work.
[15] Dr. Kutcher and the plaintiff both testified that none of the terms and conditions of the plaintiff’s employment changed after signing the 2011 agreement. Leslie Feaver testified that all working conditions remained the same both before and after the 2011 agreement. Dr. Kutcher explained to Ms. Feaver that he was changing to a different operating company and everyone was signing new contracts but that nothing else was changing.
[16] Lynn Graham was presented with a similar 2011 agreement for signature. She testified that it was understood that she was to be employed by Kutcher Dentistry Professional Corporation upon the dissolution of 339. Dr. Kutcher told her that the 2011 agreement was just a technicality and not to worry as she would still have a job. Ms. Graham testified to her understanding that it was mandatory however that she sign the 2011 agreement in order to continue her employment. Ms. Graham’s evidence further confirmed that none of the terms and conditions of employment changed after the 2011 agreement.
[17] Dr. Kutcher similarly testified that the hygienists had to sign the 2011 agreement. If they failed to sign the 2011 agreement they would not have had employment with Kutcher Professional Dental Corporation. This was made clear to the hygienists by Dr. Kutcher.
[18] On December 20, 2012 the plaintiff was given notice of the termination of her employment without cause effective that day. She was further advised that she would be provided payment in lieu of notice and her final pay in accordance with the terms of the 2011 agreement. The plaintiff was provided with one week’s pay in lieu of notice of termination totaling $1,027.85. Dr. Kutcher advised her that the reason for her termination was reorganization. The plaintiff’s record of employment lists “reorganization” as the reason for her termination. At trial, Dr. Kutcher testified that the reason for the plaintiff’s termination related to the plaintiff’s tardiness and her efforts to sell supplements at the office.
[19] At all times between 1993 and December 20, 2012 the plaintiff’s employment as a hygienist for Dr. Kutcher’s practice continued uninterrupted. It was Dr. Kutcher who consistently signed her pay cheques. The cheques were issued from Dr. Kutcher personally from 1993 to 1999, by 339 from 1999 to 2011 and by Kutcher Dentistry Professional Corporation in 2012.
Issues
[20] The parties agreed that the facts present the following issues to the court:
What is the plaintiff’s length of service with Kutcher Dentistry Professional Corporation?
Is there an enforceable employment agreement?
If there is an enforceable employment agreement, does that agreement limit the plaintiff to only the minimum amounts provided by the ESA on termination?
What notice period is the plaintiff entitled to, and what are the damages related thereto?
Did the plaintiff take adequate steps to mitigate her damages?
Analysis
- What is the plaintiff’s length of service with Kutcher Dentistry Professional Corporation?
[21] The factual matrix before the court is unique. The plaintiff worked as a dental hygienist for the practice of Dr. Kutcher continuously from September 1993 to December 2012. Technically the plaintiff had 3 employers and submitted 1 resignation throughout the 19-plus years in question but the business itself was never sold or acquired and the plaintiff’s employment for the practice of Dr. Kutcher was without interruption. Rather, throughout the 19 years, Dr. Kutcher decided to structure the employer of the hygienists for his practice in different ways.
[22] The issue then is whether Dr. Kutcher’s choice in structuring the employer of his practice’s hygienists impacts on the plaintiff’s length of service with the employer at the time of her termination. Counsel presented no law speaking directly to the issue before the court. In my view, jurisprudence on successive employers is helpful to the analysis and supports the conclusion that that the plaintiff’s length of service runs from September 1993 to December 2012.
[23] In Debenham v. CSI-Maximus (2003) 2003 CanLII 10846 (ON CA), 26 C.C.E.L. (3d) 32 (Ont. C.A.), the Court of Appeal for Ontario affirmed that employees who continue the employment are entitled to include past service in the same position when calculating length of service for the notice period. At para. 8 the court expressly agreed with the following statement of law on the effect of sales or reorganizations in Kamen v. Rose, [2001] O.J. No. 2911 (Ont. Sup Ct.), at para. 22:
There are a number of cases involving businesses that have been sold or reorganized, in which the courts have decided that an employee who retains his or her employment following such a sale or reorganization is entitled to rely on his or her employment history with the previous, as well as the current owner, in the calculation of reasonable notice upon termination. These cases further hold that this will be the presumption unless there is an express agreement to the contrary.
[24] In Kamen v. Rose, the plaintiff Ms. Kamen worked for the defendant Mr. Rose as a legal assistant from May 31, 1982 until August 1996 at one law firm, continuing with him to a second firm until her termination on March 31, 1999. Her role was the same at both firms. The parties disputed whether the employer was Mr. Rose or the second law firm, where Mr. Rose became a partner on February 19, 1998, and remained one through to Ms. Kamen’s dismissal.
[25] To determine the length of service, Sachs J. found that the plaintiffs’ primary employment relationship was through the defendant, Mr. Rose, not the law firm where he worked. The defendant directed the plaintiff’s work tasks and her schedule, and he made the decision to end the employment relationship: “For Ms. Kamen, while her pay cheque may have come from different sources, nothing else of significance in relation to her employment changed as a result of Mr. Rose's moves from law firm to law firm”: para. 17. See also para. 21 where Sachs J. wrote: “from Ms. Kamen’s perspective, she has had the same job with the same employer for sixteen and one-half years.”
[26] Throughout the 19 years, the plaintiff was employed by 3 separate legal entities. Significantly however, during this time the plaintiff worked at the same location and performed the same job under the management of Dr. Kutcher. Her employment was consistently in the operation of the dental and periodontal practice of Dr. Kutcher. The primary employment relationship was always between Dr. Kutcher and the plaintiff. Dr. Kutcher structured the employer of his practice’s hygienists differently. The structure in and of itself, however, does not negate the plaintiff’s continuity of employment with his practice or the control consistently maintained by Dr. Kutcher over the terms and conditions of the plaintiff’s employment. Rather, the structure was an intentional decision made by Dr. Kutcher for his own financial benefit and has no impact on the plaintiff’s continuous length of service.
[27] I do not accept that Mrs. Kutcher was the operating mind of 399 or that she made the final decision in terms of hiring hygienists. The evidence demonstrates that for the time of 339’s existence, Mrs. Kutcher was responsible to the practice of Dr. Kutcher in the same way she was before and after 339’s existence; for all accounting requirements. From 1993 to 2012, it was Dr. Kutcher who directed the work of the hygienists including the plaintiff and made all scheduling and compensation decisions. It was Dr. Kutcher who interviewed and made hiring decisions on new hygienists. And it was Dr. Kutcher who ultimately decided to terminate the plaintiff.
[28] It may be open to Dr. Kutcher to employ accounting practices and tax laws to design the employer of the hygienists of his practice in a way that provides him with the most financial benefit. It is not open to him however to then use that structure as a sword against the plaintiff’s uninterrupted service to his practice. At all times, independent of the choice of employer as structured by Dr. Kutcher, the plaintiff was employed by the practice of Dr. Kutcher. It is the practice of Dr. Kutcher that was the plaintiff’s substantive employer for over 19 years. The plaintiff is entitled to rely on her employment history with the practice of Dr. Kutcher in the calculation of reasonable notice upon termination.
[29] Separately, by correspondence dated March 28, 2005 the plaintiff advised that her last day working for the practice of Dr. Kutcher was to be July 7, 2005. Her resignation was rescinded well prior to July 7, 2005. The evidence demonstrates that the plaintiff was happy to remain employed with the practice of Dr. Kutcher and Dr. Kutcher was happy that she was to do so. The plaintiff continued with her responsibilities for the practice consistently and without interruption after March 28, 2005. Dr. Kutcher’s efforts to replace the plaintiff were brief and uncostly. A record of employment was never issued at this time. By correspondence dated February 20, 2006, for the purposes of the plaintiff obtaining financing, Dr. Kutcher penned a letter to whom it may concern, confirming her employment “in our office since 1993.”
[30] The evidence demonstrates that the retraction of the resignation was accepted by Dr. Kutcher and that the circumstances of the 2005 resignation had no impact on the plaintiff’s continuity of service with the practice of Dr. Kutcher. It further indicates that that at least in February 2006, Dr. Kutcher was prepared to recognize the continuity of the plaintiff’s employment with his practice since 1993, independent of both her rescinded resignation and his use of 339.
[31] For these reasons I have concluded that the plaintiff’s length of service is 19 years.
- Is there an enforceable employment agreement?
[32] The plaintiff executed 3 employment agreements during her 19 years of service with the practice of Dr. Kutcher.
[33] The 1999 agreement was signed between the plaintiff and 339. Prior to the signing of the 1999 agreement, the plaintiff had been employed with the practice of Dr. Kutcher for almost six years. The evidence clearly demonstrates that the 1999 agreement was executed by her in contemplation of continued employment and the terms and conditions of employment for the plaintiff were unchanged in the months before and after her execution of the 1999 agreement. There is no evidence that the plaintiff received independent legal advice prior to signing the contract.
[34] The 2005 agreement was signed between the plaintiff and 339. Again, the evidence demonstrates that it was signed in contemplation of continued employment and the terms and conditions of employment for the plaintiff were unchanged in the months before and after the execution of the 2005 agreement. There is no evidence that the plaintiff received independent legal advice prior to signing the contract.
[35] The 2011 agreement was signed between the plaintiff and Kutcher Dentistry Professional Corporation. In October 2011, the plaintiff received a letter stating that the plaintiff’s contract with 339 would be terminated as of December 31, 2011. The evidence demonstrates that the plaintiff was to continue in her position with the practice of Dr. Kutcher without interruption or any changes. The only difference was with the structure of employer in that a new legal entity would be issuing the paycheques. There is evidence that the plaintiff received independent legal advice prior to signing the contract.
[36] To modify an existing employment contract, there must be fresh consideration beyond continued employment: Hobbs v. TDI Canada Ltd., 2004 CanLII 44783 (ON CA) at paras. 35-6, citing Techform Products Ltd. v. Wolda (2001), 2001 CanLII 8604 (ON CA), 56 O.R. (3d) 1 (C.A.), at para. 24, leave to appeal refused [2001] S.C.C.A. No. 603. Continued employment is not considered fresh consideration. See Braiden v. La-Z-Boy Canada Limited, 2008 ONCA 464, at para. 57.
[37] The requirement for fresh consideration is particularly pronounced where the employer seeks to modify the employment contract to limit the notice to be provided upon termination, since that change represents “a tremendously significant modification of the implied term of reasonable notice”: Francis v. Canadian Imperial Bank of Commerce (1994), 1994 CanLII 1578 (ON CA), 21 O.R. (3d) 75 at 84. Appellate courts have recognized that an imbalance in power generally exists between employers and employees, making the requirement in employment law context all the more important: Braiden v. La-Z Boy Canada Limited, 2008 ONCA 464 at paras. 49-50. See also Holland v. Hostopia Inc., 2015 ONCA 762, at paras. 51-55.
[38] In Clarke v. Insight Components (Canada) Inc., 2008 ONCA 837, at para. 11, a modified employment contract that reduced the notice of termination provided upon termination was valid because it introduced fresh consideration by way of a promotion and added benefits for the employee. No such consideration is found here. Other cases that distinguish Francis, Hobbs, and Braiden also do so based on facts not present here, such as attempts to negotiate a modified employment contract on the part of the employee seeking to telecommute: see Riskie v. Sony of Canada Ltd., 2015 ONSC 5859, at paras. 31-36.
[39] In my view, none of the three employment contracts signed by the plaintiff are enforceable. Each of the contracts fail respectively for lack of consideration. The evidence clearly demonstrates that the intention of Dr. Kutcher was that each of the three contracts needed to be signed or the plaintiff could not continue to be employed with his practice. While there is no evidence of threat or duress, Dr. Kutcher was firm in his testimony that continued employment was conditional on the signing of the agreements. The plaintiff and Ms. Graham both testified to their understanding of this fact pertaining to the 2011 agreement. The plaintiff received no more from signing each of the three agreements but for continued employment. The fact that she received independent legal advice pertaining to the 2011 agreement does not negate this fact. Further, the three agreements, if enforceable, would substantially reduce the plaintiff’s entitlements on termination.
- If there is an enforceable employment agreement, does that agreement limit the plaintiff to only the minimum amounts provided by the ESA on termination?
[40] For reasons set out above I have concluded that none of the three agreements are enforceable employment agreements such that the analysis of this issue is rendered moot.
- What notice period is the plaintiff entitled to, and what are the damages related thereto?
[41] Courts look to the Bardal factors to determine the length of the common law reasonable notice period. These include the age of the employee, the character of her employment, the length of service, and the availability of similar types of employment, considering the experience, training, and qualifications of the employee. Each set of facts is unique, and courts must consider the context of the particular dismissal in identifying the reasonable notice period: Bardal v. Globe & Mail (1960), 1960 CanLII 294 (ON SC), 24 D.L.R. (2d) 140 at p. 145.
[42] At the time of her termination, the plaintiff was 54 years of age, having been employed for 19 years.
[43] In Lancia v. Park Dentistry, 2018 ONSC 751, this court found that a reasonable notice period of 18 months would be appropriate for an employee dismissed at the age of 48 who had worked for the employer over the span of 19 years (17 of which were continuous), and held the position of a restorative dental hygienist, which required more advanced training than a regular dental hygienist position: para. 120.
[44] In Partridge v. Botony Dental Corporation, 2015 ONCA 836, the Court of Appeal for Ontario held that a 12-month common law notice period was reasonable for a highly skilled dental hygienist and office manager—a position the made her “the most senior employee and held the position of greatest responsibility”: para. 17. Her length of service was 7 years and she was 36 years old the time of termination. Following termination she found part-time work in her field. However, at the time of trial three years later she had yet to find comparable full time work despite her diligent efforts. On the topic of her partially successful efforts to mitigate, the court in Partridge noted the employee’s wrongful actions, including unproven accusations of dishonesty and impropriety against her: para. 18.
[45] The defendant pled after acquired cause but has failed to meet it onus in this regard. There is no evidence that at the time of dismissal that there were facts sufficient in law to warrant a dismissal for cause but that these facts were discovered afterwards.
[46] Considering the Bardal factors and the cases reviewed above, in my view, 15 months is a reasonable common law notice period for the plaintiff. The only evidence of the plaintiff’s employment income in 2012 is her 2012 T4 Statement of Remuneration paid. The plaintiff was paid by the hour. No reason was offered nor is there a reason properly inferred from the evidence to suggest that the plaintiff would have earned less that the hourly compensation reflected therein had she been given the opportunity to work for the balance of the notice period. The plaintiff is therefore entitled to $71,650.02 in damages.
- Did the plaintiff take adequate steps to mitigate her damages?
[47] According to the Supreme Court of Canada a wrongfully dismissed employee is entitled to recover losses flowing from her wrongful termination, subject to her efforts to mitigate those losses. When assessing mitigation efforts courts ask “whether [the employee] has stood idly or unreasonably by, or has tried without success to obtain other employment”: Red Deer College v. Michaels, 1975 CanLII 15 (SCC), [1976], 2 S.C.R. 324 at 331, cited in Brake v. PJ-M2R Restaurant Inc., 2017 ONCA 402. In Brake the court noted that employee is entitled to take risks during the common law notice period and that the employer remains liable for losses that result. Not applying for comparable positions is not the same as failing to mitigate: Brake para. 94, citing Peet v. Babcock & Wilcox Industries Ltd. (2001), 53. O.R. (3d) (C.A.).
[48] The plaintiff testified that after the Christmas holiday season she began to immediately look for work although she stated that she was in no condition to work as her trust was shattered and she would sob uncontrollably. The plaintiff worked with Dr. Kutcher and specific clients for 19 years. She thought of him as family. She was heart-broken by her termination.
[49] The plaintiff’s evidence is that she contacted over 100 dentists in the Hamilton area seeking employment as a hygienist. She mailed her resume and she physically attended at the offices of dentists to present her resume. The plaintiff asked Dr. Kutcher for a letter of reference. He declined her request and stated that he would provide a recommendation if he was called by a prospective employer. The plaintiff had an interview with an office in Grimsby, Ontario. She did not get the job after the prospective employer spoke with Dr. Kutcher. The plaintiff applied for and received a license to permit her to work independently as a hygienist in a clinic that does not have a dentist (license to self-initiate). She sought work through a temp agency and attempted to develop her own business as a hygienist working in a hygiene clinic. The plaintiff was able to mitigate approximately $2,558.90 of her damages during the 15 month notice period.
[50] Dr. Kutcher introduced a 2013 economic report to the dental profession prepared for the Ontario Dental Association. He relied on the report to demonstrate that there was a high demand for hygienists in 2013 and the defendant’s submission that “it is unbelievable that someone with [the plaintiff’s] credentials could not find an employment position or more freelance /independent contract work reflecting less than 1 day per month during the notice period she claims.” The report is unhelpful however in assessing the veracity of the plaintiff’s mitigation efforts as it fails to speak to the supply and demand of hygienists in the Hamilton area.
[51] The plaintiff presented no physical evidence of her mitigation efforts. She testified that she lost her day timer and was only able to identify a small fraction of her efforts.
[52] I accept the plaintiff’s testimony at trial and conclude that she made reasonable efforts to mitigate her damages by seeking employment as a hygienist. I found her to be credible when she spoke about her intention to stay employed in the profession in which she practiced and excelled at since graduating from her studies in the area.
[53] The defendant submits that the plaintiff is not credible. Most of its submissions stems from the plaintiff’s involvement in Max International.
[54] The plaintiff testified that in September 2014, she took over her now ex-husband’s business with Max International (“Max”). Max is a health and wellness company offering specific supplements for sale. The plaintiff’s ex-husband had been selling Max products since 2010. The plaintiff supported his effort since 2010 by regularly educating members and prospective members of the Max family with respect to the science of the supplements sold. Her efforts were at times on her own and at times alongside her husband. She also spoke to Dr. Kutcher’s patients about Max products from 2010 until her termination.
[55] The plaintiff’s evidence is that she did not earn an income from her efforts with Max until she began the transition to take over her ex-husband’s account with the company in February 2014. The transition was fully completed by September 2014. The plaintiff did not receive income from Max until 2014 as reflective in a Max printout which showed monies paid by Max to the plaintiff and her husband jointly during February and March 2014. It would appear however from the summary of her ex-husband’s 2013 income tax return that he did not claim income from Max from that year either.
[56] The plaintiff testified that Lou Stranges is her bookkeeper. She states that he has never prepared a tax return for her ex-husband. A letter from Mr. Stranges dated November 2017, addressed to both the plaintiff and her ex-husband, suggests that he prepared and filed both of their 2013 tax returns. Mr. Stranges did not testify at trial. While the letter creates pause from the perspective of the plaintiff’s ex-husband’s income tax reporting obligations and the involvement of Mr. Stranges in this regard, I disagree with the defendant that the plaintiff’s evidence with respect to her involvement with Max and the income derived from the business impacts on her credibility at this trial and particularly her testimony as it relates to mitigation and damages.
[57] I accept the plaintiff’s testimony that she took over husband’s Max account in 2014 and that she began receiving income jointly from Max in February 2014. I further accept that once the transition from her husband to herself was completed in September 2014, she solely began to receive income from Max.
[58] Prior to the commencement of the transition, the plaintiff worked to support her husband’s Max account without attributed income as a devoted partner would do. The income earned by the Max account was family income so that it makes sense to me that the plaintiff would make regular appearances on behalf of her husband’ s account to encourage the sale of products and the recruitment of further salespeople on behalf of and in the best financial interest of the account.
[59] When the plaintiff assumed her husband’s account during the breakdown of the marriage, she also assumed its history. She advertised herself as having been involved with Max since 2010 and having become a silver status performer within one month of starting with Max. The plaintiff was speaking about the account, however, not about herself or her husband individually. She testified that she did not get into specific personal details of how she took over the account in 2014 and that it was actually her husband’s account before that, while she was addressing a crowd on behalf of Max. This makes sense as her efforts were to sell product and recruit people on behalf of the account, not to disclose the particulars of the ownership of the account from the perspective of the breakdown of her marriage.
[60] It is for these reasons that I have concluded that the plaintiff reasonably mitigated her damages.
Conclusion
[61] For reasons set out above I have concluded that 15 months is a reasonable common law notice period for the plaintiff and that she is therefore entitled to damages in lieu of notice totaling $71,650.02, less the $2,558.90 that the plaintiff earned during the notice period.
[62] If parties are unable to agree on an appropriate costs award I will receive written submissions in this regard of not more than three pages. The plaintiff shall submit her submissions within 30 days and the defendant shall reply within 30 days thereafter. The plaintiff may file a reply, if deemed necessary, within 20 days.
V.R. Chiappetta J.
Released: May 25, 2018
COURT FILE NO.: CV-14-517336
DATE: 20180525
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
JASMINE THEBERGE-LINDSAY
Plaintiff
– and –
3395022 CANADA INC. O/A KUTCHER DENTISTRY PROFESSIONAL CORPORATION
Defendant
REASONS FOR JUDGMENT
V.R. Chiappetta J.