Court File and Parties

COURT FILE NO.: CV-15-6265 DATE: 2019 07 09 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Grant McGuinty, Plaintiff

– and –

1845035 Ontario Inc. o/a McGuinty Funeral Home, Defendant

COUNSEL: Janine Liberatore and Sara Yousefi, counsel for the Plaintiff Sabrina A. Lucenti and Eric O. Gionet, counsel for the Defendant

HEARD in North Bay: May 22, 23, 24, 27, 28, 29 and 31, 2019

REASONS FOR JUDGMENT R.D. Gordon J.

Overview

[1] The Plaintiff Grant McGuinty (“Grant”) was a third generation owner of the McGuinty Funeral Home Limited when, in 2012, he agreed to sell his shares to the Defendant 1845035 Ontario Inc., a company controlled by Gary and Steven Eide. It was a term of the share purchase agreement that the Plaintiff would enter into a Transitional Consulting Services Agreement (the “TCSA”) by which he would continue in the employ of the funeral home for ten years.

[2] Not long after the transfer of ownership, unhappy differences arose between Mr. McGuinty and the Eide brothers. Within 11 months, Mr. McGuinty had gone on medical leave due to workplace stress he says was induced largely by the actions of Gary Eide (“Gary”). He has been unable to return to work and claims to have been constructively dismissed. He seeks damages for breach of the TCSA, intentional infliction of mental suffering and discrimination prohibited by the Ontario Human Rights Code.

Background Facts

[3] The McGuinty Funeral Home has had a long and respected presence in North Bay. It was started by the Plaintiff’s grandfather and run out of his home by successive generations. It remains in that same location today.

[4] Grant and his brother Maurice McGuinty (“Maurice”) became owners in 1990, taking the business over from their father. They were equal owners who took much pride in tending to the needs of grieving North Bay families in what the Plaintiff often termed “the McGuinty way”.

[5] The business was successful and enjoyed a significant portfolio of prepaid funeral arrangements. Grant and Maurice enjoyed respect in the community. They made a decent living. They enjoyed their work and they worked well together. Both were licensed funeral directors with strengths that complimented the other. Maurice was an effective administrator who, in addition to funeral work, kept the books, looked after the paperwork and ensured the smooth operation of the funeral home. Grant, in addition to funeral work, was the “face” of McGuinty’s, and took great pride and pleasure in attending community events, doing charitable work and being readily available to families who had lost a loved one.

[6] Unfortunately, Maurice fell ill and eventually it became clear that he would not be able to continue in his work.

[7] Grant was left with a choice. Either buy his brother out and run the funeral home on his own or sell. He elected to sell. I accept that there were several reasons for his decision: He perceived the funeral industry to be changing and felt it would not be as lucrative in the future. He was feeling somewhat burdened by many of the administrative tasks that had previously been undertaken by his brother. He was then 55 years of age and found the prospect of going into debt by a million dollars to buy his brother’s interest to be daunting.

[8] The timing seemed right.

[9] The timing was also right for Gary and his brother Steven Eides (“Steven”). They were local businessmen who owned a funeral home in the nearby town of Powasson and a funeral chapel in the nearby community of Callender. They were interested in expansion and recognized the value of the McGuinty name and reputation.

[10] Grant and Gary held initial discussions. Those discussions turned into negotiations. Those negotiations culminated in a share purchase agreement dated September 30, 2012, by which on that same day, a corporation controlled by Gary and Steven would become the owner of all of the shares in McGuinty Funeral Home Limited and the real property upon which the funeral home was located.

[11] Article 2 of the Share Purchase Agreement provided for the payment of $1,840,000 for all shares in the company, payable by way of vendor take back loan of $300,000 and the balance by cash, subject to any adjustments on closing. The real property was to be purchased from Grant and Maurice’s holding company for $460,000.

[12] Article 6 of the Share Purchase Agreement made completion of the agreement conditional upon, among other things, Grant entering into a “Transitional Services Agreement” by which he would continue to be employed by the funeral home for a period of 10 years, and a non-competition agreement by which Grant would not, for a period of 10 years following the date of termination of his employment by the funeral home, compete within a two hundred kilometer radius of the City of North Bay. Both agreements were signed on closing.

[13] The corporation controlled by Gary and Steven became owner and began operating the funeral home on October 1, 2012.

[14] The “Transitional Services Agreement” referred to in the Share Purchase Agreement was prepared as a “Transitional Consulting Services Agreement” or TCSA. The TCSA recitals recognized Grant as “the key employee” of the business and indicated that the purchaser required him to provide transitional services. Those transitional services were defined in paragraph one of the agreement as follows:

The Vendor hereby agrees with the Purchaser to make his services available to the Purchaser in order to provide transitional services to Purchaser including, but not limited to, the following: training and informing the Purchaser of all aspects of the operation of a Funeral Home business including without in any way limiting the generality of the foregoing, training in funeral preparation and sales, customer relations, employee matters including preparation of payroll and filing of Employee deduction forms, remittance of all statutory filings and remittances, operation of the cash register and computer system, if applicable, of the Purchaser’s business and sundry other tasks as same may reasonably arise.

The duties of the Vendor shall be the general management of the Funeral Home with no embalming or body removal duties required.

[15] Paragraph 2 of the TCSA required Grant to be available to the purchaser during normal weekday hours of operation or regularly scheduled evenings at times and for such lengths of time as may be mutually agreed.

[16] Paragraph 3 of the TCSA provided that Grant shall be the General Manager of the Funeral Home and shall be paid $100,000 per annum with review on an annual basis to reflect cost of living increases.

[17] Paragraph 4 of the TCSA provided the parties’ agreement with respect to the following terms of employment:

i. TERM: TEN (10) YEARS, Commencing September 30, 2012 and ending September 30, 2022;

ii. HOURS: 37.5 hours per week during weekdays only and excluding evenings unless agreed upon;

iii. VACATION: EIGHT (8) weeks at time convenient or as selected by Grant McGuinty, including consecutive weeks;

iv. CORPORATE EXPENSES: Vehicle, Fuel

v. BENEFITS: To continue as is presently available to the Vendor through the Business;

vi. GOLF MEMBERSHIP: North Bay Golf & Country Club or equivalent;

vii. COMMISSION: 5% on prepaid funerals at the current or present value at the time of death of the Purchaser of the prepaid services as and when payment is received by the Purchasers (excluding cash disbursements and taxes) but only having regard to prepaid funerals prior to the closing date of the intended transaction.

viii. COMMISSION: 65% of the “Marketing Allowance” component on “in-house” Pre-arranged funeral packages.

[18] Paragraph 8 of the TCSA provided that the agreement may not be assigned or cancelled by the parties in whole or in part except as otherwise provided therein. There was no other contractual provision providing for cancellation.

[19] In the few months immediately following the sale, the funeral home was particularly busy, and everything seemed to be going reasonably well.

[20] It was not long, however, before certain fairly fundamental issues started to arise.

[21] These issues can be grouped into the following main categories: Firstly, the hours Grant was expected to be spending on funeral-related work as opposed to customer relations. Secondly, the use of the company vehicle and gas card for personal purposes. Thirdly, the length of time over which Grant would be paid the commission of 5% on pre-paid funerals. Fourthly, whether the commission of 65% of the marketing allowance was only for in-house pre-arranged funeral packages specifically arranged by Grant or for all in-house packages, regardless of who arranged them.

[22] As these issues developed there came to be a lack of trust between Gary and Grant. By the summer of 2013 an employee of the funeral home was tracking the amount of time Grant spent in the office and a memo was issued by Gary requiring that all employees (including Grant) complete time sheets, a step to which Grant took great offence. Eventually Gary required the return of the company vehicle and repayment of personal gas charges, a step Grant perceived to be in breach of the contract and a personal affront to him. Gary was not paying Grant 65% of the marketing allowance on all in-house pre-arranged funeral packages and Grant perceived this to be a deliberate breach of contract.

[23] During the Labour Day Weekend in 2013, Grant entered the funeral home and removed a number of personal items he had stored there. Gary believes he also threw out funeral home files during this attendance and when he learned of it changed the locks to the premises without advising or consulting with Grant.

[24] On September 4, 2013, Grant was put on two weeks medical leave by his Doctor. She provided a note that read: “Off work X2 weeks to be reassessed in the office before then.” On September 16, he was re-assessed and continued on leave in accordance with a further note provided by his Doctor which read as follows: “Off work for medical reasons while work issues are resolved”. Both notes were provided to Gary, but no other medical reports were provided. No one at the funeral home followed up with Grant to determine how he was doing or when he might return.

[25] Grant says that on October 4, 2013, he had a telephone conversation with Gary during which Gary indicated his desire to have him back at work. He says he went to the funeral home at Gary’s invitation to discuss matters further at which time Gary said he looked terrible and that Steven did not want him to come back. He took that to mean he was no longer welcomed. Gary denies that this meeting took place.

[26] Grant says that later in October, he attended the funeral home for the funeral of his cousin and learned that he had been assigned to a desk in the basement kitchen. He took this as additional evidence that his return was not welcomed. Gary says the desk had been moved to the kitchen many months previous and had long been used by a pre-arranged funeral agent named Samantha Pettipaw.

[27] Gary says that on December 13, 2013, he met with Grant at the funeral home. He says that Grant was upset, distraught and apologetic and wanted to return to work. Gary says he recommended that Grant see his doctor and return to work if given a doctor’s note that said it was appropriate. He says that was the last he heard from Grant until service of the Statement of Claim in this action. Grant says the meeting of December 13 never happened.

[28] Grant never returned to work. There was little additional communication between the parties until the Plaintiff issued and served his claim.

Legal Principles

Constructive Dismissal

[29] In Potter v. New Brunswick (Legal Aid Services Commission), 2015 SCC 10, the Supreme Court of Canada provided its most recent summary of the law of constructive dismissal. It held that constructive dismissal arises when an employer’s conduct evinces an intention to no longer be bound by the employment contract, and the employee treats that conduct as a repudiation of the contract by the employer.

[30] The burden rests on the employee to establish that he has been constructively dismissed, and he may do so in one of two ways.

[31] First, he may establish a unilateral breach of the employment contract by the employer that substantially alters an essential term of the contract. This requires a two stage analysis: (a) On an objective basis, has there been a unilateral breach of the employment contract by the employer? (b) If so, at the time of the breach would a reasonable person in the same situation as the employee have felt that the essential terms of the employment contract were being substantially changed?

[32] The second way an employee can establish constructive dismissal is to establish conduct or a course of conduct that, when viewed in the light of all the circumstances, would lead a reasonable person in the circumstances of the employee to conclude that the employer no longer intended to be bound by the terms of the contract.

[33] Regardless of the conduct alleged by the employee, he must establish that that his failure to return to work was causally linked to that conduct. [See Persaud v. Telus Corporation, 2017 ONCA 479].

[34] If an employee consents to or acquiesces in the change to an essential term of the employment contract, it will not amount to a constructive dismissal. [See Potter, supra].

Intentional Infliction of Mental Distress

[35] In Prinzo v. Baycrest Centre for Geriatric Care, 2002 CarswellOnt 2263, the Ontario Court of Appeal recognized the following required elements of the tort of intentional infliction of mental suffering: (i) the conduct was flagrant and outrageous; (ii) the conduct was calculated to cause harm; and (iii) the conduct resulted in a visible and provable illness or injury. With respect to the second element, the defendant must intend to cause such harm, or such harm must be known by him to be substantially certain to follow from his or her behavior. As an intentional tort, this element cannot be satisfied on an objective standard of reasonable foreseeability or recklessness.

Position of the Plaintiff

[36] The Plaintiff takes the position that the Defendant’s unilateral decision to cease paying for his gas and requiring him to return the company vehicle amounted to a substantial change in an essential term of his contract of employment that evinced an intention by the employer to no longer be bound by the employment contract. He is also of the view that the Defendant’s course of conduct in removing the company vehicle, tracking his hours and activities, removing managerial duties, changing the locks, limiting payment of commission on prepaid funerals and moving his workstation to the basement kitchen would lead a reasonable person to conclude that the Defendant no longer intended to be bound by the terms of the employment contract.

[37] The Plaintiff is of the view that the Defendant’s conduct was designed to cause him to leave his employment, and that much of the conduct took place when he was on leave for stress related illness that the Defendant knew would be exacerbated by its conduct.

Position of the Defendant

[38] The Defendant does not deny that it required return of the company vehicle and that it eventually refused to pay gas charges related to the Plaintiff’s personal use of the vehicle. However, it is of the view that doing so did not amount to a breach of the employment contract and in any event was acquiesced in by the Plaintiff and was not a substantial change to an essential term of the employment contract.

[39] The Defendant denies any impropriety in monitoring the Plaintiff’s hours of work and changing the locks of the business premises.

[40] It denies having moved the Plaintiff’s workstation to the basement kitchen.

[41] The Defendant is of the view that it has paid all commissions in accordance with the employment contract and that to the extent it has not done so, its failure to pay was in the nature of a disagreement as to calculation of those commissions and not an indication that it did not wish to honour the contract.

[42] To the extent the Defendant is found to have acted at all inappropriately, it is of the view that such conduct was not the cause of the Plaintiff’s leaving his employment. It is of the view that Grant found himself ill-suited to the role of employee and suffered from seller’s remorse. The Defendant argues that Grant orchestrated much of the discord in an effort to induce Gary to breach the TCSA and fire him in hopes that he would reap the benefits of the contract without having to work.

Analysis

The Transitional Consulting Services Agreement

[43] Much of the difficulty that has arisen between Grant and Gary arises from their disparate understanding of the terms of the TCSA.

[44] When interpreting a contract, the court is to focus on the meaning of the words used in it. When dealing with a commercial contract it is not particularly helpful to frame the analysis in terms of the subjective intention of the parties when the contract was drawn. To do so denudes the contract of the certainty that reducing its terms to writing was intended to achieve. The purpose of the interpretation of a contract is not to discover how the parties understood the language of the text which they adopted. Rather, it is to determine the meaning of the contract against its objective contextual scheme. The text of the contract must be read as a whole and in the context of the circumstances that existed when the agreement was reached. The circumstances include facts that were known or reasonably capable of being known by the parties when the contract was entered into. [See Dumbrell v. The Regional Group of Companies Inc. (2007), 2007 ONCA 59, 85 O.R. (3d) 616].

[45] The relevant contextual circumstances existing when the parties entered into the TCSA are as follows. To begin with, both Grant and Gary were experienced funeral directors and businessmen who would be expected to negotiate a sensible and workable agreement. Secondly, the TCSA arose in the context of the sale of Grant’s funeral business to Gary - a sale comprised primarily of goodwill. Gary’s interest was in ensuring that the reputation of McGuinty’s Funeral Home was maintained so that the business it had generated in the past would continue into the future. Grant’s interest was in ensuring a continued income stream through to retirement at age 65 and preserving the legacy of three generations of “the McGuinty Way”. To accommodate these interests they agreed to a ten year employment contract with compensation tied to: (1) services provided by Grant on an ongoing basis; (2) payment to Grant of a commission of 5% of pre-arranged funerals existing on the date of closing, as and when those funerals were realized; and (3) payment to Grant of 65% of the marketing allowance for in-house pre-arranged funerals.

[46] It is within this context that the contract must be interpreted.

Personal Use of Vehicle and Gas

[47] Under the heading “TERMS OF EMPLOYMENT” the TCSA indicates the parties’ agreement that vehicle and fuel would be a corporate expense.

[48] The issue here is whether the funeral home was agreeing to pay for the vehicle and gas only when it was being used for corporate purposes, or whether it was agreeing to pay those expenses when the vehicle was being used by Grant personally.

[49] In my view, this provision should be interpreted as requiring the funeral home to pay the vehicle and gas expenses during its corporate use and during its reasonable personal use by Grant. I come to this conclusion for the following reasons. Firstly, it seems unlikely that a managing director of a funeral home would be expected to personally pay the costs of a vehicle and fuel used for funeral home business. Accordingly, the contractual provision requiring the employer to pay vehicle and gas expenses must have been directed at something else. Secondly, it appears in the contract in the middle of several provisions that confer a benefit on Grant. As payment by the funeral home of only the expenses related to corporate use would not constitute a benefit to Grant, is seems unlikely that it was directed solely to those expenses. Thirdly, the provision itself simply refers to “Vehicle, Fuel” and provides no restrictions. Fourthly, the Defendant paid for all vehicle expenses, including personal use, for several months before the issue was ever raised.

5% on Pre-Paid Funerals

[50] The TCSA provides that Grant be paid a commission of 5% of prepaid funerals that were in existence on the date of closing as and when those funerals are held and paid for.

[51] The issue with respect to this provision is the length of time over which Grant is to receive this commission.

[52] In my view, this provision should be interpreted as requiring payment of this commission only during the ten year term of the TCSA. I come to this conclusion for the following reasons: To begin with, it being a term of the TCSA and not the share purchase agreement indicates the intention of the parties to have it limited to the term of the TCSA. Secondly, the prepaid funeral arrangements would represent a not insignificant portion of the goodwill of the business – goodwill for which Gary and Steven had already agreed to pay $1,840,000. It makes little sense that Grant would be paid again for that goodwill beyond his consulting services agreement. Thirdly, the TCSA is directed largely towards preserving the goodwill of the funeral home and ensuring that the prepaid funerals that had been arranged are realized by the funeral home. The commission serves is an incentive to Grant to preserve the reputation of the business and the faith of the families it serves. Once Grant is no longer in the employ of the funeral home, payment of the commission would serve no purpose as an incentive to him. Lastly, the TCSA is, by its own title, a “transitional” agreement. It was for a set term during which Gary and/or Steven would transition into the “face” of the funeral home. It was anticipated that by the end of its term there would be sufficient public confidence in their ownership that there would no longer be any significant risk of prepaid funerals being withdrawn.

65% of Marketing Allowance

[53] Clients of the funeral home may prearrange their funerals in one of two ways. They may physically prepay the costs of their funeral, in which event those funds are held in trust by the funeral home until such time as the client dies and are then used to fund the costs of the funeral, or a policy of insurance can be arranged on the life of the client with the insurance proceeds payable to the funeral home on the death of the client to cover the costs of the funeral arrangements. When a prearrangement is done through a policy of insurance, the insurance company pays a commission to the funeral home that arranged or “sold” the policy. This is known as a marketing allowance.

[54] For the purposes of this case, prepaid funerals through a policy of insurance come about in one of two ways: (1) Clients make an inquiry directly of the funeral home and the insurance is arranged “in-house” by an employee of the funeral home; or (2) the public is solicited by the funeral home through a mass mailing and is directed to a person not employed by the funeral home who then arranges or sells the policy.

[55] In either event, the company providing the insurance pays a commission. For those policies that are not arranged “in-house”, the person who arranges or sells the policy is paid the commission. For those policies sold “in-house” the TCSA provides that 65% of the commission paid to the funeral home will be paid to Grant.

[56] The issue is whether Grant is entitled to commission on all “in-house” policies that are sold, or whether he is entitled to commission only on those policies that he personally sells.

[57] In my view, the TCSA entitles him to commission on all “in-house” policies that are sold. I come to that conclusion for three reasons. Firstly, the agreement does not restrict the commission to policies sold by him. Secondly, given his role as the general manager of the funeral home and the specific duties prescribed for him in paragraph 1 of the TCSA it seems unlikely that he would be involved in many such sales. Thirdly, the payment of such a commission on all such “in-house” policies would serve as an incentive for him to ensure that the employees were trained to provide the service to clients.

Working Hours

[58] There are two provisions in the TCSA dealing with hours of work. The first is in paragraph 2, in which it is agreed that Grant shall be available to Gary during “normal weekday hours of operation or regularly scheduled evenings at the times and for such length of time as may be mutually agreed” by them. The second is in paragraph 4 (b) of the TCSA which provides that his hours shall be “37.5 hours per week during weekdays only and excluding evenings unless agreed upon.”

[59] From these provisions, it is clear that Grant was expected to work 37.5 hours per week, primarily during regular business hours, but also during evenings when agreed upon.

[60] The bigger issue between the parties under this heading was how those hours were to be divided among the various responsibilities undertaken by Grant, and how those hours were to be accounted for.

[61] On the first issue, Grant was of the view that his community and charitable interests were a significant part of customer relations, and that his attendance at such events and meetings should be counted as part of his required hours. Gary was of the view that he should be providing 37.5 hours per week directly to management of the funeral home.

[62] In my view, it was not appropriate for Grant to consider hours spent on customer relations outside of the funeral home towards the hours he was contractually required to work each week. In this regard, I note paragraph 1 of the TCSA defines the parameters of his work and provides that he will make his services available to the Defendant in order to provide transitional services including, but not limited to, “training and informing the Purchaser of all aspects of the operation of a Funeral Home business including without in any way limiting the generality of the foregoing, training in funeral preparation and sales, customer relations, employee matters including preparation…” and “…the general management of the Funeral Home…”. In short, his role was to train Gary and provide general management of the funeral home.

[63] To the extent his role was to involve customer relations outside of the funeral home, it was restricted to training Gary in such. In my view, general management of the funeral home would not anticipate or require his participation in community and charitable organizations or playing golf with members of families the business has served over the years.

[64] With respect to the issue of tracking hours it is to be noted that Grant was not paid on an hourly basis. He was a salaried employee, and one who was entrusted with the general management of the funeral home. The employment agreement did not require him to sign in when attending work and sign out when leaving so that his hours could be logged. It is my view that, at least initially, he was not contractually bound to do so.

[65] However, when Gary became concerned about the time Grant was spending outside of the funeral home during regular business hours, it was not inappropriate for him to ask Grant to record his hours on time sheets. He was expected to be involved in the general management of the funeral home for 37.5 hours per week. Gary was entitled to some assurance that this work commitment was being met.

Constructive Dismissal by Requiring Return of the Company Vehicle Amount?

[66] As I have noted above, the TCSA required the Defendant to provide the Plaintiff with a vehicle and gas not just for corporate purposes, but for personal use also, provided such use was reasonable.

[67] The Defendant’s requirement that the Plaintiff pay for gas related to personal use and, eventually, that he not use the vehicle for personal use at all, was a breach of the TCSA.

[68] The use of a motor vehicle, and payment of the expenses associated with it, were part of the Plaintiff’s compensation package.

[69] The Plaintiff’s evidence is that when the company vehicle was taken from him, he was required to lease a vehicle, pay licensing and insurance, and maintain and fuel it. He estimated the costs at $12,000-15,000 per year in total. This evidence was not seriously contested by the Defendant and is not unreasonable.

[70] Whereas the contract had provided for salary of $100,000 and the use of a vehicle, now the costs associated with the vehicle had to be paid independently by the Plaintiff. Even taking the low end of the Plaintiff’s estimated costs, there was an effective reduction in salary of $12,000 or 12%. Over the course of the contract, it would amount to over $100,000.

[71] Compensation is an essential element of the employment contract. Reduction in compensation of 12% is significant. In my view a reasonable person in the same circumstances as the Plaintiff would have concluded that the employer’s conduct evinced an intention to no longer be bound by the employment contract.

[72] The bigger issue is whether the Plaintiff treated this conduct as repudiation of the employment contract by employer, thereby rendering him constructively dismissed. In my view he did not.

[73] It was on August 30, 2013, that the Defendant sent the Plaintiff a letter requiring return of the vehicle within one week and indicated that it would no longer be provided for personal use. On that same day, the Plaintiff replied with a letter indicating his objection to the position of the Defendant. One week later, the Plaintiff provided another letter to the Defendant to make it clear that he was not stepping down from his position as general manager of the funeral home. On October 29, 2013, the Plaintiff sent an email to Gary looking to clear up certain matters, including payment of commissions and set-off of certain expenses against employment or commission income. There is no mention of the vehicle in this email. The email closes with the following: “Feel free to call me in the meantime to discuss an amicable solution to all issues so that we can both move forward…”.

[74] Although an employee faced with a unilateral change of an essential term of the employment contract is entitled to some time to process the change and consider how best to respond, the Plaintiff’s express indication that he was not standing down from his employment and the two year delay in proceeding with his claim speak to his not having treated the Defendant’s removal of the vehicle as a repudiation of the employment contract.

Constructive Dismissal by the Employer’s Course of Conduct?

[75] The course of conduct complained of by the Plaintiff includes the withdrawal of the company vehicle, tracking of his time and activities, limiting the payment of commissions, moving his work station to the basement kitchen, removing his picture from the wall, changing the locks, and interfering with his managerial duties.

Withdrawal of the Company Vehicle

[76] As determined above, withdrawal of the company vehicle was in breach of the TCSA and represented a not insignificant decrease in compensation.

Tracking of Time and Activities

[77] Also, as determined above, it was not inappropriate or unreasonable for the Defendant to have insisted that the Plaintiff track his time on time sheets. The Plaintiff was an employee obliged by contract to work at least 37.5 hours per week. From the express terms of the contract, that time was to be spent on tasks related to the general management of the funeral home. If the Defendant was concerned that the required hours were not being spent, asking the Plaintiff to self-report on those hours was reasonable.

[78] However, the independent tracking of the Plaintiff’s time and activities by an employee supervised by him and without notice to him was not appropriate. In this regard, it was the evidence of Jenniffer Ritchie that she was asked to keep track of the Plaintiff’s hours spent at the funeral home, and that she was doing so in June, July and August of 2013. When this eventually came to the attention of the Plaintiff, he quite reasonably perceived it as a lack of Gary’s trust in him, and the undermining of his authority over Ms. Ritchie.

Limiting the Payment of Commissions

[79] As I have determined above, the TCSA, properly interpreted, required payment to the Plaintiff of 65% of the marketing allowance received by the Defendant for all prepaid funeral services arranged “in-house”, not just those arranged by the Plaintiff personally.

[80] The failure of the Defendant to pay those commissions was not, in my view, a deliberate breach of the employment contract. It was more in the nature of a dispute as to the proper manner in which those commissions were to be calculated. Nonetheless, a reasonable person in the place of the Plaintiff might well regard such non-payment as conduct on the part of the Defendant evincing a lack of respect for him and the position he was taking.

Moving of the Work Station and Removal of Picture

[81] The Plaintiff testified that when he went to the funeral home for his cousin’s funeral in mid-October 2013, he discovered that a desk had been moved to the basement kitchen. On the desk were various files and a time sheet with his name on it for September 2013. He understood from this that the desk was to be his new work station.

[82] There are various conflicting views as to when the desk was moved and what was on it. Grant provided one version. Mr. Stephen Robinson provided general support for Grant’s version. Gary testified that the desk was moved at a different time. His evidence was generally supported by Jenniffer Ritchie.

[83] In my view, it is not necessary to determine when the desk was moved or what was on it. What is important is whether Grant was being permanently relegated to that desk and whether he had been informed to that effect.

[84] Regardless of when the desk was moved, it is apparent that his nameplate and documents that had been on his desk upstairs were moved to the desk in the basement lunchroom sometime after he went on sick leave in the fall of 2013.

[85] Grant says he was told by one of the employees that this was now his desk. He could not recall specifically who told him. He thought it might have been Mr. Robinson, but Mr. Robinson did not testify to that effect. Grant said it might have been Nicole Sullivan, but she did not give evidence to that effect. He thought it might have been Trevor Levesque, but Mr. Levesque did not give evidence to that effect. Most likely, Grant saw the desk in the basement kitchen, saw the timesheet with his name on it, and assumed that his workstation had been moved. Importantly, Grant has never suggested that Gary or Stephen told him his work station had been moved.

[86] Grant had provided Gary with a medical note that he would be on medical leave with no set date for return. His work station was in a prime location in the upstairs office. In my view, it is likely that the items from his desk were moved to the desk in the basement kitchen so that the upstairs workspace could be used in his absence. Without evidence that Grant was told by Gary or Steven that this was a permanent or even temporary relocation of his workstation, I am not satisfied that this amounted to wrongful conduct.

[87] Grant also testified that his picture was taken down from a wall that had photographs of the history of ownership of the funeral home. That this photograph was removed was not denied by the Defendant. However, it was not a term of the TCSA or the share purchase agreement that this photograph remain on the wall and its removal was not in breach of the contracts. Nonetheless, in the context of the other differences between the parties and how their relationship was regressing, removal of the photograph would reasonably have been perceived by Grant as being disrespectful of him and all he had worked for.

Changing the Locks

[88] Following the Plaintiff’s attendance at the funeral home on Labour Day weekend to remove personal items he had stored there, Gary directed that the locks be changed. His reason for doing so was his understanding that Grant had improperly removed and disposed of funeral home files and documentation.

[89] There was conflicting evidence with respect to the disposition of the files and documentation. Grant categorically denied having removed or disposed of any funeral home property. Gary says there was video footage of Grant carrying items towards the garbage bin and that files and documents were retrieved from the bin by one of the employees. There has been no theory advanced of why Grant may have disposed of these materials. If he did, there seems to have been no benefit to his having done so.

[90] In my view, the issue is not whether or not Grant disposed of funeral home files or documents. I accept that Gary believed he had done so. The bigger question is whether without asking Grant for an explanation, without providing him with notice of his intention to do so, and without providing him with a set of new keys, it was appropriate for Gary to change the locks for the business when Grant, although on medical leave, was still the managing director of the funeral home. It was not.

[91] A reasonable person in Grant’s position when this happened would perceive this conduct as a significant derogation of his ability to act in the role of general manager.

Interference with Managerial Duties

[92] It was Grant’s perception that as managing director of the funeral home it was to be run as directed by him, and any instruction to staff or management made by Gary was usurping his role. That perception fails to acknowledge that Gary was also a professional funeral director, was regularly in attendance at the funeral home, and was the owner.

[93] Gary was not obliged to accept management decisions made by Grant if he disagreed with them and there is nothing in the TCSA derogating from Gary’s authority as owner to direct the policies and procedures to be followed by employees. Grant was accustomed to having the last word. To the extent Gary usurped any management role of Grant, I am of the view he was entitled to do so.

[94] Grant also complained of being treated badly by Gary in the presence of other staff, thereby usurping his authority over them. He was particularly upset by one instance at a funeral being conducted at Peter the Apostle Church when he had left during the service to ensure the doors to the mausoleum were open. Gary, who was also attending to that funeral, was not told that Grant was leaving or where he was going. On Grant’s return, Gary spoke to him in the presence of other employees and indicated that if was leaving during a funeral service it is necessary to advise the team where he was going and when he would be back.

[95] Grant’s perception of this encounter was that Gary accused him of “abandoning the team” and that Gary thought he had left the funeral. Grant’s evidence was that this was very humiliating, particularly because it happened in the presence of other employees and inferred wrongful conduct on his part.

[96] Gary’s perception of this encounter was that he was looking for Grant and could not locate him. He had tried to call his cell phone but got no answer. When Grant returned he simply asked where he had been and said he should tell someone if he was leaving during a funeral. According to Gary he did not raise his voice or make any sort of scene in the presence of other employees. To him it was a minor issue.

[97] Also attending at this funeral was Oscar Levesque, a long-time employee of the funeral home. Grant says he had a conversation with Mr. Levesque not long after this incident in which Mr. Levesque said that he didn’t know how Grant was handling the stress and that it was embarrassing to hear Gary speak to him as he had. Grant says he took notes of this conversation which were entered as exhibit 13. Mr. Levesque gave evidence at trial. He recalled the incident at the church and said that Grant had called him later to discuss it. However, he says that he told Grant it was no big deal. He denied saying most of the things attributed to him by Grant.

[98] This altercation, if one can call it that, took place at a funeral, in relatively close proximity to those attending. I take from that, that the discussion would not have been particularly loud or aggressive. I do not doubt that Grant perceived Gary’s comments as humiliating and embarrassing. I doubt that anyone listening in would have shared that perspective. I do not doubt that Mr. Levesque commiserated with Grant on the phone and would have held some sympathy for him. Grant’s perception of those comments, and Mr. Levesque’s recollection of what was said are predictably different.

[99] In all, I do not see Gary’s conduct towards Grant on this or any other occasion as oppressive, humiliating or improper. I heard a good deal of evidence regarding incidents when Grant felt his role was being usurped by Gary or that his authority with employees was being undermined. Although Grant may have genuinely harboured such feelings, except as otherwise specified in this decision, I do not believe that a reasonable person in Grant’s shoes would have shared this view and I do not.

[100] I am not satisfied that Gary improperly involved himself in the operation and management of the funeral home, or that he undermined Grant’s authority with employees. The employees knew that Grant was the managing director. They also knew that Gary was the owner. It was not unreasonable for Gary to provide them with direction or for them to defer to his direction when it was provided.

Conclusion

[101] Neither Grant nor Gary is blameless for the falling out that occurred. However, over a period of several months Gary: (1) Improperly terminated Grant’s use of the company vehicle; (2) Without notice to the Grant, recruited an employee who was subordinate to him to track his time at the funeral home; (3) Did not pay Grant commissions to which he was rightfully entitled; (4) Removed Grant’s photograph from the Funeral Home; and (5) Without notice to the Grant and without seeking any explanation from him, changed the locks to the funeral home. I am satisfied that this amounted to a course of conduct which, it light of all the circumstances, would lead a reasonable person in Grant’s position to conclude that the Defendant no longer intended to be bound by the terms of the TCSA.

Causation

[102] The Defendant argued that even if there was conduct to establish that the Defendant no longer intended to be bound by the TCSA, that conduct was not the cause of the Plaintiff’s refusal to return to work.

[103] The Defendant’s position is that Grant decided he no longer wished to continue to work not because of anything it did, but because he was exceedingly remorseful for having sold the family business.

[104] According to Gary and Steven, the Plaintiff’s remorse for having sold the business first manifested itself in late December of 2012 and early January of 2013. Steven testified that between Christmas and New Year’s, while Gary was away on vacation, Grant approached him at the funeral home with a proposed addendum to the share purchase agreement. Steven says Grant had paperwork with him but that he did not get a look at it and was not left with a copy. He testified that he did not recall details of what was being proposed and simply told Grant that he would not sign anything. He said that Jenniffer Ritchie was present when this discussion took place.

[105] Jenniffer testified that on December 28, 2012, Grant attended at the funeral home and handed Steven a package of papers and asked that he sign them. She says Steven handed the package back to him and said that he would have to speak to Gary when he returned. She says that on January 4, 2013, she was present when Grant said to Gary that he wanted something signed concerning the agreement. She could not recall the specifics of what it was about but remembers that it having something to do with commissions on pre-arranged funerals being paid indefinitely. She said that Gary told him to take the paperwork to his lawyer.

[106] Gary, in his testimony, confirmed that in early January, he was approached by Grant who had papers in his hand and was saying he had an addendum he wanted signed. He says Grant told him he should not be working 37.5 hours per week and that he wanted to be paid commissions in perpetuity. He says he was not provided with a copy of the paperwork and refused to sign anything.

[107] Grant’s evidence was that none of this ever happened. Although it has always been and continues to be his position that he is entitled to the 5% commission in perpetuity, he says it was never discussed with the Defendant, was never put in issue by him in any of the email or letter exchanges between them and was not referred to by Jenniffer in the statement she prepared on September 5, 2013, outlining various issues concerning Grant.

[108] The Plaintiff’s suggestion that this issue was never raised and was concocted by Gary and Steven to assist them in this litigation seems far-fetched. The length of time over which the 5% commission would be paid strikes me as a legitimate issue that would very likely have been raised by Grant at some point after closing. That does not mean that I accept entirely that he had prepared an addendum to the original contract, or that he attended specifically with Gary or Steven in an effort to have new documentation signed. That may well have been their perception, but both acknowledged that they did not see what documents Grant was wielding and only assumed that is what he had in hand. In any event, I do not see this issue as the beginning of the end of the positive relationship between them. As noted above, it never arose again between the parties. There is no evidence it was referred to the lawyers for action. It did not appear in the list of issues identified by Grant in his email to Gary of October 28, 2013, (Exhibit 26). Indeed, it seems to first have arisen as an issue in the Defendant’s statement of defence.

[109] The Defendant also submitted that Grant’s voluntary departure from the funeral home is evidenced by statements he is said to have made to Jenniffer Ritchie and Oscar Levesque.

[110] Jenniffer Ritchie gave evidence at trial and adopted the truth of a statement she prepared on September 5, 2013. In that statement she said, among other things, that Grant “was convinced that he would take the Eide’s to court and regain control of the funeral home and that we would both walk away with money from a lawsuit against their apparent breach of contract with” him. I find there to be significant frailties with her evidence in this regard. To begin with, Ms. Ritchie had much to gain by Grant’s departure from the funeral home. Indeed, she became managing director not long after he left and continues to occupy that position today. Secondly, she seems to have taken a fairly active role in trying to formulate a case against Grant. She accepted the assignment of monitoring his time at the office. Without direction from Gary, she called at least one person (Darren Denomme) to investigate what Grant was doing while out of the office. Without direction and without having ever examined the funeral home security video before, she undertook the review of several hours of video surveillance to see what Grant had been doing in the funeral home over the Labour Day Weekend. Thirdly, she attributes to Grant no specific words or admission that he intended to take Gary or Steven to court – essentially she provides her opinion that Grant was convinced he would take them to court and be successful but provides no evidence in support of that opinion. Fourthly, she prepared her letter of September 5, 2013 of her own volition and provided it to the Defendant’s lawyer without request or direction from Gary or Steven.

[111] In all, her statement of September 5, 2012, is in my view, little more than a self-serving indictment of Grant.

[112] Oscar Levesque also testified at trial and adopted a letter he says he prepared on October 30, 2013, in which he attributed a statement to Grant that “if he could make the Eides pissed off enough and make them fire me, I can sue them and take them to the cleaners for the remained of my contract.” His evidence was that Grant said this to him at the end of a conversation they had while on their way to take communion following the incident between Grant and Gary at St. Paul’s. Mr. Levesque was forthright in admitting that he had close ties to the funeral home and that he, his son and his grandson had all enjoyed employment under Gary. During examination-in-chief, Mr. Levesque testified that no one asked him to write the letter, that it was written entirely by him, and that he wrote it because he felt something was not right and that the funeral home was going down. On cross-examination he conceded that Ms. Ritchie had, in fact, typed the letter and that he gave the letter to Gary. When asked why he provided the letter to Gary, he answered: “For court, if we had to go to court.” It was in interesting answer, in which he clearly identified his interests to lie with Gary.

[113] Mr. Levesque struck me as a basically honest fellow. I do not believe that he deliberately mislead the court. However, his obvious alignment with the Defendant may well have coloured his recollection of events and how they were related in court. Although I do not doubt that Grant asked him to remember the events of that day, and that Mr. Levesque perceived from that request that Grant may have intended to take action against Gary, I doubt very much that Grant would otherwise have made the statement attributed to him.

[114] Many of the medical records filed as evidence at trial do reference the Plaintiff’s guilt and remorse arising from the sale of his business. The Defendant points to several of these entries and argues that it was seller’s remorse that led to his departure.

[115] The Plaintiff acknowledges significant remorse, but not because he sold the business. He says the remorse referred to in the medical records refers to remorse for the situation he found himself in - unable to work and no longer being paid - and for having decided to sell the business to Gary, who he felt was responsible for his situation.

[116] Although the medical records do contain significant references to guilt arising from the sale of the business, concern that he has compromised his daughter’s inheritance, and regret for having sold the business, it is important to understand the context in which these statements were recorded.

[117] These were not complaints voiced by Grant in the early months following the sale, when things were going well with the new owners. These were not complaints voiced by him in the spring or summer of 2013 when tensions were mounting with the new owners. These complaints arose only after the Defendant had conducted itself in such a manner that it was reasonable for Grant to believe that it had repudiated the employment contract. At that point he was not able to work. He was not being paid. He was not being paid commissions to which he was entitled. He had been locked out of the funeral home that had been in his family for generations. He was being forced to rely on capital to survive, thereby compromising his financial situation and what he had hoped his daughter may eventually inherit. I am satisfied that the remorse and the regret arose not from having sold the business, but for having sold the business and the situation turning out as it had.

Did the Plaintiff Acquiesce in the Defendant’s Conduct?

[118] The Defendant points out that the Plaintiff first left work on September 2, 2013, and by the Plaintiff’s own admission, he considered himself to be on extended sick leave until such time as his claim was issued and served two years later. Certainly, the Defendant received no notice from the Plaintiff that he considered himself constructively dismissed until the claim was served.

[119] In Persaud v. Telus Corporation, 2017 CarswellOnt 8934 the Ontario Court of Appeal agreed with the trial judge that “an employee is entitled to a reasonable period of time to assess his or her circumstances and make an election. However, a considerably extended period of time will preclude an action for constructive dismissal. In most circumstances, the court will view an employee’s willingness to remain in the altered position for a significant period of time as acceptance of the new terms, absent other mitigating factors.”

[120] The Defendant argued that the two year period during which the Plaintiff remained on sick leave with no notice that he considered himself to have been constructively dismissed is an extended period of time which precludes his action for constructive dismissal.

[121] I do not agree. What is required for condonation or acquiescence is acceptance of the new situation, which may be inferred by the employee’s willingness to remain in the altered position for a significant period of time, absent other mitigating factors.

[122] In the case before me, it cannot be said that Grant willingly remained in his position subject to the conduct of the Defendant for the intervening period. The evidence is clear that he did not and could not return to work during that period of time due to depression and anxiety caused by that very conduct.

[123] In summary, the Defendant engaged in a course of conduct that would lead a reasonable person in Grant’s position to conclude that it considered itself no longer bound by the terms of the employment contract. The Plaintiff accepted that repudiation. He was constrictively dismissed.

The Claim of Intentional Infliction of Mental Suffering

[124] In my view, the conduct I have found to have resulted in the Plaintiff’s constructive dismissal was, for the most part, neither flagrant nor outrageous.

[125] The termination of Grant’s use of the vehicle was the result of an honestly held but mistaken belief that it was not contractually bound to provide the vehicle for personal use.

[126] The tracking of Grant’s time by a subordinate employee without notice to him was intended to be done without Grant’s knowledge. If he was not to have knowledge of it, it could not have been done with the desire to cause him mental suffering.

[127] The refusal to pay commission was, as I have noted, an honestly held but mistaken understanding of the contractual obligation.

[128] The removal of Grant’s picture from the wall is simply not outrageous conduct.

[129] The changing of the locks without notification to him or seeking an explanation was obviously improper, however I am not satisfied that it was done with a view to causing the Plaintiff mental suffering or that it was conduct that was substantially certain to result in his mental suffering. In that regard, there is no evidence that when the locks were changed the Defendant was aware the Plaintiff was going on sick leave, or that he was suffering from work-related stress issues. Although the Defendant may well have wished to see Grant leave his employment, the evidence is not sufficient to establish that it wished to achieve that goal by causing him such emotional distress or mental anguish that he would have no alternative but to quit, as was the case in Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419.

[130] The Plaintiff’s claim for intentional infliction of mental suffering is dismissed.

The Human Rights Code Claim

[131] The Plaintiff argues that after September of 2013, he was suffering from a disability, namely anxiety and depression, and that the Defendant’s conduct towards him amounted to discrimination and harassment due to that disability.

[132] I am not satisfied that the Plaintiff’s disability played any part in the manner in which the Defendant conducted itself.

[133] The Defendant was not provided with any particulars of the nature of the Plaintiff’s medical leave until September 16, 2013, when it received a brief note from his family doctor that he was “off work for medical reasons while work issues are resolved”. This is the only medical evidence provided to the Defendant until after this action was commenced. It is hardly sufficient to establish that he suffered from a disability and certainly insufficient to fix the Defendant with notice of that disability. Without proof that the Defendant even had knowledge of the disability it cannot be proved that it discriminated against or harassed the Plaintiff in whole or in part due to that disability.

Damages

[134] In the absence of an enforceable contractual provision stipulating a fixed term of notice, or any other provision to the contrary, a fixed term employment contract obligates an employer to pay an employee to the end of the term, and that obligation will not be subject to mitigation [Howard v. Benson Group Inc., 2016 ONCA 256, para. 44]. Accordingly, the Plaintiff is entitled to the compensation and benefits he would had received had the contract been honoured. Neither party provided calculations of the present value of damages for the three years remaining on the contract, nor of the pre-judgment interest for the six years during which the Plaintiff has not been paid. In the absence of those calculations. It is appropriate to set those amounts off and simply calculate the loss per year and multiply it by the 9 years remaining on the contract when the Plaintiff ceased work (the approach taken by the parties in their closing submissions).

Annual Base Salary

[135] Grant was to be paid $100,000 annually. His loss of salary is $100,000 per year for 9 years, or $900,000.

Use of the Company Vehicle and Fuel

[136] Grant’s evidence was that the cost to him of leasing a vehicle, insuring it, fuelling it and maintaining it was between $12,000 and $15,000 per year. He was not seriously challenged on the evidence and no evidence was led to indicate that such expenses would be unreasonable.

[137] In the absence of supporting documents, I am inclined to use the low end of the estimate, the damages under this head would be $12,000 per year for 9 years, or $108,000.

Benefits

[138] The TCSA provided that Grant’s benefits would “continue as is presently available to the Vendor through the business”. It was established at trial that those benefits included medical, dental, life and disability coverage.

[139] The Plaintiff did not lead evidence of the value of those benefits or the cost of replacement benefits. Instead he suggested that the benefits be valued at 15% of salary, or $15,000 per year, for the remaining 9 years of the contract.

[140] The Defendant submitted that the court cannot simply choose a percentage of salary without the benefit of some evidence that the percentage is appropriate.

[141] The principle of proportionality in litigation has taken on added importance in recent years. As noted in in Mikelsteins v. Morrison, 2018 ONSC 6952, the courts have often chosen a reasonable percentage of salary to value benefits “based upon the allure of a simple formula, selected for the sensible reason to avoid the litigation cost of unravelling a potentially contentious subject-matter without significant benefits”. The court in Mikelsteins adopted a rate of 10% as has been applied in several other cases, including Ruston v. Keddco Mfg. (2011) Ltd, 2018 ONSC 2919.

[142] In my view, it is generally appropriate, in the absence of evidence to the contrary, to value benefits at the rate of 10% of salary. Such an approach respects the principle of proportionality but allows either party to lead evidence to the contrary should there be sufficient disparity between this manner of calculation and the actual costs of benefits to the Plaintiff. There has been no evidence to suggest that the 10% rate would be inappropriate in this case.

[143] Accordingly, I find the damages under this heading to be $10,000 per year for the 9 year balance of the contract, for a total of $90,000.

Golf Membership

[144] The parties agreed that the value of the golf membership was $1,000 per year. Over the 9 year period, the damages under this heading would amount to $9,000.

5% Commission of Pre-Arranged Funerals

[145] When the business was sold, the funeral home had a significant portfolio of prepaid funerals. During the 10 years of the TCSA the Plaintiff was to be paid 5% of the amount received by the funeral home on account of those funerals.

[146] The Financial Statements of the funeral home as of the date of sale indicates the value of those pre-arranged funerals at $7,832,196. The Plaintiff suggested that these damages be calculated on the following basis:

• on average, the cost of a funeral is $6,600.
• the 5% commission is calculated on the cost of the funeral, less the cost of disbursements, which are typically $400 per funeral or 6% of the funeral cost.
• deducting 6% of the value of the pre-arranged funerals ($469,931.76), the remaining value as of closing would be $7,362,264.24.
• 5% of the remaining value would be the commission, namely $368,113.21.
• from this would be deducted the payment of commission received by the Plaintiff of $12,897.71. The balance owing would be $355,215.50.

[147] The Defendant argued that certain of the assumptions used by the Plaintiff are unproved and/or seriously flawed. For example, there is no independent evidence of the cost of an average funeral or the breakdown between fees and disbursements; and most significantly, the Plaintiff’s calculation assumes that all persons who had pre-arranged their funerals as of October 2, 2012, would die within ten years thereafter, with no evidence of that likelihood or a reasonable estimate in that regard. The Defendant argued that it was incumbent upon the Plaintiff to provide expert evidence on the valuation of this loss and his failure to do so has resulted in insufficient proof of the loss.

[148] In Martin v. Goldfarb, 1998 CarswellOnt 3319, para. 75, the Ontario Court of Appeal held as follows:

…it is a well established principle that where damages in a particular case are, by their inherent nature difficult to assess, the court must do the best it can in the circumstances. That is not to say, however, that a litigant is relieved of his or her duty to prove the facts upon which the damages are established. The distinction drawn in the various authorities, as I see it, is that where the assessment is difficult because of the nature of the damages proved, the difficulty of assessment is no ground for refusing substantial damages even to the point of resorting to guess work. However where the absence of evidence makes it impossible to assess damages, the litigant is entitled to nominal damages at best.

[149] This is a case in which the assessment of damages is difficult because of the nature of the damages to be proved. It would be next to impossible to say with any exactitude who, of the people who had pre-arranged funerals on October 2, 2012, could be expected to die during the period in question, what the costs of each of their funerals would be, and how that cost would be broken down between fees and disbursements.

[150] I agree that the damages assessment provided by the Plaintiff is untenable because it assumes that all persons with pre-arranged funerals would die within the 10 years following the sale of the business and it fails to account for the possibility that people may withdraw or terminate their pre-arrangements.

[151] It is clear that the Plaintiff has suffered a loss. The nature of the damages makes it difficult to assess with precision what that loss will amount to. However, there is evidence upon which those damages can be estimated.

[152] In the eleven month period between October of 2012 and August of 2013, the Plaintiff was entitled to payment of $12,701 on account of commissions, as established by his payroll records (Ex 30) and Gary’s email of October 4, 2014, (Ex 25). The average monthly commission was roughly $1150. In terms of an estimate, it seems likely to me that over the remaining ten years, commissions would have continued to accrue at a similar rate. The Plaintiff was not paid commissions for September of 2013 nor for the remaining 108 months of the contract. I would fix his damages under this heading at $1150 X 109, or $125,350.

[153] During argument, counsel for the Defendant pointed out that the Plaintiff had not sought information from the Defendant on pre-paid funerals existing on closing and realized by the date of trial until just a week before trial began, and that although best efforts were made to provide the requested documents, not all could be amassed. He suggested that had that information been sought at an earlier date, an actual damages figure (at least as of the date of trial) could have been ascertained for this heading of damages, and with respect to the marketing allowance as well. It was suggested that the Plaintiff’s failure to obtain and present this information to the court should be regarded as a failure to prove those damages.

[154] Although it would have been preferable for the Plaintiff to have requested and analyzed those documents at an earlier date, I would also note that the documents are clearly relevant to an issue in this action, were in the possession of the Defendant, and were the subject of the ongoing disclosure obligation set out in Rule 30.07. Accordingly, the Defendant had an ongoing obligation to disclose the documents with or without a request from the Plaintiff. In these circumstances I am not inclined to accede to the Defendant’s suggestion that the Plaintiff has failed to adequately prove damages.

65% of the Marketing Allowance

[155] As I have already determined, the Plaintiff was to receive 65% of the marketing allowance received by the funeral home for pre-arranged polices sold in-house.

[156] The Plaintiff’s evidence is that there would be 40 to 50 such policies arranged each year and that the average marketing allowance would be 7% of the cost of the funeral insured, less disbursements. The Plaintiff estimated the average funeral cost, net of disbursements to be $6200. 7% of 6200 is $434 and his entitlement would be 65% of that amount or $282.10 per pre-arrangement. If 40 such pre-arrangements were entered into each year, the Plaintiff’s share of the marketing allowance would be $282.10 X 40 or $11,284 year. Grant provided no evidence in support of his position.

[157] The Defendant, through Jenniffer Ritchie, led evidence that there were 9 “in-house” pre-arranged funerals sold in the year following the change in ownership, with commissions earned of $6,670.58. Grant’s entitlement would be 65% of this amount or $4,335.88. He was paid $762.05 on June 1, 2013, leaving a balance for that year of $3,573.83. Ms. Ritchie was not cross-examined on this aspect of her evidence.

[158] The evidence with respect to these damages after Grant’s employment ceased is far from satisfactory. However, the best evidence before me is the uncontested evidence of Ms. Ritchie. That evidence was not challenged as inaccurate. Aside from Grant’s unsubstantiated estimate, no one suggested that the year following the sale was any sort of aberration.

[159] In the circumstances, I would estimate Grant’s loss at $4,250 per year for the remaining 9 years of his contract, which would amount to $38,250, plus the underpayment from year one of $3,573.83, for a total loss of $41,823.83.

Aggravated and Punitive Damages

[160] In the context of a wrongful dismissal claim, aggravated damages may be awarded against the employer where the employer engages in conduct during the course of dismissal that is unfair or is in bad faith by being, for example, untruthful, misleading or unduly insensitive. However, the normal distress and hurt feelings resulting from dismissal are not compensable. [Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419, Keays v. Honda Canada Inc., 2008 SCC 39, [2008] 2 S.C.R. 362.].

[161] In my view, this is not a case where aggravated damages are appropriate. The Defendant was not engaged in a course of conduct designed to cause mental distress, nor was it actively seeking the Plaintiff’s resignation. It was not untruthful with the Plaintiff, did not mislead the Plaintiff, and was not unduly insensitive towards him. Although several of its actions were, in hindsight, ill-advised, those actions were not sufficiently egregious to warrant additional damages.

[162] I am similarly of the view that punitive damages are not warranted. The Defendant’s conduct has not been harsh, reprehensible and malicious. It has not been sufficiently extreme in its nature that by any reasonable standard it is deserving of full condemnation and punishment [see Keays, supra, at paragraph 68].

Conclusion

[163] The Plaintiff shall have judgment against the Defendant for $1,274,173.83.

[164] By agreement of the parties, the Defendant’s counterclaim is allowed in the amount of $8,500.00.

[165] If the parties are unable to agree on costs they may make written submissions to me within 60 days, not to exceed six pages plus attachments each.

The Honourable Mr. Justice Robbie D. Gordon

Released: July 9, 2019