COURT FILE NO.: CV-19-30 (Owen Sound)

DATE: 20211020

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

MELANIE McGRAW

Plaintiff

-and-

TOWNSHIP OF SOUTHGATE and DAVID MILLINER

Defendants

John Tamming, for the Plaintiff

Sabatina Vassalli and Taylor Carson, for the Defendants

Heard: April 6, 7, 8, 9, 19, 20, 2021 by video conference; written submissions received April 29, 2021 and May 6, 2021

Justice R. Chown

REASONS FOR DECISION

[1] The plaintiff was fired from her employment based on unfounded, sexist allegations and gender-based discrimination.

[2] I have found the conduct of the defendants discriminatory and reprehensible. I award damages for failure to provide reasonable notice, moral damages, damages under s. 46.1 of the Ontario Human Rights Code, R.S.O. 1990, c. H.19 (OHRC), damages for defamation, and punitive damages.

Parties

[3] The plaintiff Melanie McGraw was an administrative assistant and a volunteer fire captain with the Dundalk Fire Department (DFD).

[4] The DFD is operated by the defendant the Township of Southgate. The defendant David Milliner is the chief administrative officer (CAO) of Southgate.

[5] The DFD is a volunteer department. At the relevant time, the only paid positions were Ms. McGraw’s part time administrative assistant position and the full time fire chief’s position.

[6] “Volunteer” firefighters do receive modest compensation for the time spent actually responding to calls: $25 per hour. They also received $20 per night for nights they attended training. There are four to five captains who also receive an annual stipend of $2,500.

[7] Ms. McGraw was fired from both of her positions with the DFD on February 7, 2019.

Hearsay

[8] It is acknowledged by the defendants that Ms. McGraw’s employment was terminated without just cause. Nevertheless, this trial was largely about the reasons why Ms. McGraw was fired. This flowed from the main defence arguments, which I characterize as follows: We did not act with malice or in bad faith or discriminate against Ms. McGraw. We fired her because she was the object of rumours that we believed were true. We could not prove they were true, so we fired her on a without cause basis and paid severance. The pervasive nature of the rumours shows that we did not act with malice, bad faith, or discrimination.

[9] As a result, without objection, a tremendous amount of hearsay evidence was proffered and described as “rumours.” The “rumours” were reviewed in detail at trial. Furthermore, efforts were made to try to prove that many of the “rumours” were true.

[10] The word “rumours” minimizes what was being said about Ms. McGraw. The things being said about her were mostly unfounded, malicious, sexist falsehoods.

[11] Some of the hearsay was relevant to the defendants’ state of mind and admissible on this basis, but some of it was irrelevant because the defendants were not even aware of it.

Summary

[12] A good starting place and a good way to summarize this case is to review Mr. Milliner’s reasons for firing Ms. McGraw and my summary findings in respect of each of these reasons.

[13] The decision to fire Ms. McGraw was Mr. Milliner’s. Mayor John Woodbury testified that as CAO, Mr. Milliner did not need council’s approval for the decision, but council did unanimously approve the decision. Mr. Milliner explained his reasons to council in a closed session meeting. As was routine for Township of Southgate council meetings at the time, the meeting was recorded. The recording was not disclosed before trial.

[14] In a mid-trial ruling (2021 ONSC 2785), I found that part of the recording was privileged, but the part where Mr. Milliner gave his reasons for firing Ms. McGraw was not. Mr. Milliner’s stated reasons, followed by my summary conclusions on each point, were the following:

a. “inappropriate behavior … and you can fill in the blanks or you can ask me if you want.”

Not a single witness was critical of Ms. McGraw’s abilities as a firefighter, fire captain, or administrative assistant. To the contrary, the evidence overwhelmingly supports the conclusion that she was good at her job. Mr. Milliner acknowledged that Ms. McGraw had the credentials to become deputy fire chief. Apart from unspecific hearsay, there was no evidence called of inappropriate behaviour on the part of Ms. McGraw while on the job. The innuendo in Mr. Milliner’s statement was unjustified.

b. “inappropriate pictures of herself she texted to other firefighters. There was a fair bit of … this is a few years ago.”

The evidence presented at trial did not establish that Ms. McGraw sent naked or otherwise inappropriate pictures of herself to other firefighters. In 2016, she did send a picture of herself in a towel to her then new boyfriend and now common law husband, Corey Allen, who was a volunteer firefighter. He showed this photo to others, generating a crude discussion about her in the radio room of the fire hall.

Rumours that Ms. McGraw had sent other firefighters naked pictures of herself began circulating in the DFD before 2015. Most of the witnesses who testified were aware of the rumours and believed them to be true. But Ms. McGraw was not made aware of them. And the rumors were not true. Despite the extensive evidence on this point that was presented at trial, not one witness provided first-hand evidence that they received or even saw such photos, apart from Cody McGrady who said he saw the “towel” picture in the radio room.

Furthermore, no one ever complained to Ms. McGraw about sending inappropriate photos or raised the issue with her.

c. “I haven’t gone to everyone that I know was involved because they just up and quit. I mean it even got to the point of a male female on the fire department very concerned and said I’m just outta here. This isn’t going to affect my relationship with each other.” [sic]

This is a reference to Lori and Bruce Marshall, a married couple who were both volunteer firefighters. Ms. Marshall testified that she and Mr. Marshall left the fire department in part because of events involving Ms. McGraw, but the events she described do not justify the allegations that spread as a result, or justify Ms. McGraw’s termination. These events occurred in approximately 2014, about five years before Ms. McGraw was fired in 2019. Ms. Marshall described discovering through her phone bill that Ms. McGraw and Mr. Marshall had exchanged over 300 text messages. The content of those messages was never described in evidence. No evidence was given that there was anything sexual or otherwise inappropriate about the text messages, or that they included naked photos. Ms. McGraw testified that there was nothing inappropriate about them. She said she was friends with Mr. Marshall. Mr. Marshall did not testify. The defendants never even put it to Ms. McGraw that the text messages were inappropriate or asked her about their content.

As Mr. Tamming pointed out, it takes two to text message. Why this should be laid only at the feet of Ms. McGraw was not explained. Yet after Ms. McGraw’s termination, Mr. Marshall rejoined the DFD, apparently without any sanction associated with the text messages. A sexist double standard was applied.

d. “I had a young lady come into my office that was there. She had training at the college, so a very valuable resource … [She] felt there was tension within the group and she just couldn’t stay there with those kind of working … relationships” [sic].

This is a reference to Jamie-Lynn Davison, who testified at trial. Ms. Davison was critical of Ms. McGraw to some extent, but most of her criticism was directed at Don Zeggil, who was fire chief at the time. Whether Ms. Davison was treated unfairly by Mr. Zeggil is relevant only because of the attempt by the defendants to cast Ms. McGraw as part of the unfairness Ms. Davison perceived. It was not established by the evidence that Ms. Davison was treated unfairly. She was taken off the “pager list” (effectively she was released as a volunteer) by Mr. Zeggil for reasons that had nothing to do with Ms. McGraw, but rather because of Ms. Davison’s poor attendance at practices and calls. Mr. Milliner’s statement to council as to why Ms. Davison left the DFD was inaccurate and one-sided, because (a) Ms. Davison was released and did not resign; (b) Mr. Milliner never even asked Mr. Zeggil to respond to Ms. Davison’s complaint of unfairness to understand his side of the story; and (c) Ms. Davison’s termination had very little to do with Ms. McGraw.

e. “I think that there is morale problems that are within the group because I’ve heard it. I’ve got people that I have confidence in that shared information with me that again don’t want to put it in writing. I have heard from through sources that other fire chiefs know that there is morale problems in our service” [sic].

It was unfair and inappropriate to lay any morale problem within the DFD at the feet of Ms. McGraw.

f. “this young lady [Ms. McGraw] also teaches at the fire college and I have heard through another [fire department] … They are saying that if you want to pass the fire college there’s ways to do that and be entertained at night too. So, I mean, I don’t want to fill in the blanks with stupid stuff but this is the kind of nonsense that’s going on.”

During the trial, this and a similar comment made by Mr. Milliner to Mr. Zeggil (“How do you pass a course at the fire college? … You can sleep with Melanie McGraw.”) came to be referred to by both sides as “the sex for grades” comments. Mr. Milliner had no basis for this allegation. He admitted at trial that he embellished a rumour and when pressed in cross examination he admitted that he made the allegation up. It was completely false and blatant gender-based discrimination.

g. “I have heard rumours of relationships within the fire department but that’s not a place I am going. I am not even going to bring these things up.”

It is unclear whether Mr. Milliner was speaking of a relationship between Ms. McGraw and Mr. Zeggil or Ms. McGraw and Mr. Allen.

It seems that most of the DFD thought there was a longstanding intimate relationship between Ms. McGraw and Mr. Zeggil. Ms. McGraw’s relationship with Mr. Zeggil did include one occasion of intimacy in 2015, when Mr. Zeggil and Ms. McGraw were both volunteers. Thereafter, they remained friends but many people within the DFD thought there was more to the relationship and there was a great deal of gossip to this effect.

Ms. McGraw started a relationship with Mr. Allen in 2016 when she was the administrative assistant and a volunteer fire captain, and Mr. Allen was a volunteer auxiliary firefighter. This relationship ended later in 2016 and resumed sometime in 2017. As indicated previously, Ms. McGraw and Mr. Allen are now common law spouses with each other.

Ms. McGraw’s relationship with Mr. Allen did not seem to dampen the gossip that she was in a relationship with Mr. Zeggil. The three were cruelly and unjustifiably described, behind their backs, as in a love triangle.

The DFD and the Township of Southgate did not have policies that would prevent individuals involved in relationships from working with each other. In addition, in his investigation which led to Ms. McGraw’s termination, Mr. Milliner did not even ask Mr. Zeggil, Mr. Allen or Ms. McGraw about their relationships or implement any changes to address the issue. In any event, again, to the extent this was a factor in Ms. McGraw’s termination, a sexist double standard was applied in that only Ms. McGraw was terminated.

h. “When you hear things like, you know, well I’d say it’s like 50 kilometers away that they know and it has caused problems with firefighters coming home and this kind of crap being run around their fire department” [sic].

This is a reference to gossip that Mr. Milliner received from his daughter who works at the Orangeville Fire Department, and to uninvestigated and doubtful information Mr. Milliner received from his son-in-law who volunteered at the Grand Valley Fire Department. Mr. Milliner’s daughter, Ashley Milliner Cowan, testified. She heard rumours but could not remember who she heard them from. The rumours were of unspecified “inappropriate behaviour” on the part of Ms. McGraw and that Ms. McGraw was “flirtatious.” That was the extent of it. She passed these rumours on to Mr. Milliner. Mr. Milliner’s son-in-law, Neil Cowan, also testified. He said he was approached by a colleague / volunteer firefighter at the Grand Valley Fire Department who said he received training from Ms. McGraw at the fire college and was made to feel uncomfortable by her. Mr. Milliner did not investigate this hearsay allegation. Ms. McGraw’s employer at the fire college was not Southgate. There was no direct relationship between the two jobs.

In the absence of further investigation, the information Mr. Milliner received from his daughter and son-in-law was unworthy of serious consideration.

i. “We aren’t being respected as a fire department. When I think of people that put that uniform on in the past and carried themselves professionally, we are letting that down a bit.”

The evidence presented before me contradicts the assertion that Ms. McGraw was unprofessional. In addition, this remark fails to recognize that it is unprofessional to engage in sexist gossip about a colleague.

j. “There has been multiple people turn over and because of this very thing” [sic].

This is a reference to high turnover at the DFD, but that high turnover cannot be fairly attributed to Ms. McGraw.

Facts

Plaintiff’s Employment in Fire Fighting

[15] Ms. McGraw was hired as an auxiliary firefighter at the DFD in 2009 by then-Chief John Thompson. Separately, Ms. McGraw worked as a school bus driver so had a B licence, which permitted her to drive fire trucks. She became a regular volunteer firefighter with the DFD in 2010.

[16] Ms. McGraw became a part time instructor at the Ontario Fire College in 2014. This was a paid position which involved roughly five weeks per year of instructing, although this varied. This was not specifically connected to her position at the DFD.

[17] Ms. McGraw was promoted to Captain at the DFD in 2015. Ms. McGraw was the only female captain at the time and the only female on the DFD in a position of authority.

[18] In April of 2016, after volunteering to assist with some administrative duties for Chief Thompson, a position called Fire & Emergency Services Administrative Assistant was created, and Ms. McGraw accepted this position. This was a 16-hour-per-week part time position which paid $23,000 per year.

[19] Ms. McGraw hoped a full time position would become available at the DFD in 2018. She acknowledged that if she had never been offered more hours, she would have eventually had to look for additional or other work.

[20] In 2018, Ms. McGraw had an opportunity to obtain a full time position at the Kirkland Lake Fire Department but initially declined, it being her preference to remain in Dundalk.

[21] In January of 2019, Ms. McGraw accepted the opportunity in Kirkland Lake, taking a position as a full time platoon chief. Kirkland Lake is a 5½ to 6-hour drive from Dundalk. Ms. McGraw nevertheless intended to keep her position in Dundalk, as well as the full-time position in Kirkland Lake. The position in Kirkland Lake involves 24 hour shifts with the schedule being 24 hours on, 24 hours off, 24 hours on, and then five days off. At that point, she had children ages 16 and 18 living in Dundalk with her and her common law husband, Mr. Allen. She thought it would be manageable to maintain the 16 hour per week position in Dundalk. Her hours of work in Dundalk were flexible. She also intended to maintain her position as a volunteer fire captain in Dundalk. Firefighters refer to this as “two-hatting” and it is permitted in both Dundalk and Kirkland Lake. She hoped a full time deputy chief position would open up in Dundalk.

[22] The job in Kirkland Lake is much better paying, but Ms. McGraw testified that she would have been happy to remain in Dundalk for less pay if she had been given full time hours.

[23] Ms. McGraw’s employment with the DFD was terminated on a without cause basis on February 7, 2019, for both positions.

Don Zeggil

[24] Don Zeggil became a firefighter with the DFD in 1999. When Ms. McGraw joined the DFD in 2009, he was a fire captain.

[25] Ms. McGraw and Mr. Zeggil both testified that they had one night of intimacy in 2014 and were never intimate again. At the time, he was a captain. She was a firefighter. Ms. McGraw told Mr. Allen about this shortly after they began their relationship. I heard no evidence that anyone else became aware of this one night of intimacy, although multiple witnesses from the DFD testified that they believed there was a romantic element to the relationship throughout the time Mr. Zeggil was fire chief.

[26] Ms. Zeggil and Ms. McGraw both testified that immediately after that night, they mutually agreed they would not continue an intimate relationship. They did remain friends.

[27] There is good reason to accept the evidence of both of them that the intimate relationship was limited as they described, and I do accept their evidence in this regard. Later in these reasons, I will return to why this evidence should be accepted.

[28] There was no written or verbal policy prohibiting relationships between members of the DFD. The current fire chief, Derek Malynyk, testified that there was a policy that you can’t be in direct supervision of a spouse or anybody you are in a relationship with, but Joanne Hyde, the clerk of the township, testified that there was no such policy.

[29] In mid-2015, about 9 or 10 months before the retirement of Chief Thompson, Mr. Zeggil became deputy fire chief.

[30] As indicated, in April of 2016, Ms. McGraw became administrative assistant. She was selected for the position by Chief Thompson and not by then-Deputy Chief Zeggil.

[31] At the same time, Mr. Zeggil was promoted to fire chief when Chief Thompson retired. No replacement deputy chief was hired.

[32] Mr. Zeggil and Ms. McGraw worked closely together from 2016. They both testified that they were friends and that they would help each other and socialize with each other outside of work.

[33] Mr. Zeggil held Ms. McGraw in high regard for her capabilities and work ethic.

Corey Allen

[34] Corey Allen became a volunteer firefighter in May of 2016. He did not know Ms. McGraw when he applied and was hired. He and Ms. McGraw started dating in August of 2016. There was a break in the relationship as Mr. Allen wanted to rekindle a relationship with a former girlfriend. The dates of the breakup and resumption of the relationship between Ms. McGraw and Mr. Allen were not nailed down. There was evidence that they bought a house together with a closing date of September 16, 2017. However, they did not start living together until August of 2018. They each have children from other relationships, and they did not want to start living together until they were sure the “elements were proper” before they moved in together.

[35] In February of 2017, Mr. Allen got into an altercation with another firefighter, Mike Thompson. Mr. Allen pushed Mr. Thompson against a fire truck. In addition to being a volunteer firefighter, Mr. Allen was employed with the Town of Southgate as a seasonal facility operator at the arena and a seasonal roads patroller. His probation period for these positions was extended as a result of the altercation. At the time, Mr. Allen was advised by Mr. Milliner that if he did not resign and was fired, he would have more difficulty getting back on the fire department; however, Mr. Milliner told Mr. Allen, “It shouldn’t be an issue” to get rehired. Mr. Allen resigned. None of this had anything to do with Ms. McGraw.

[36] Mr. Allen re-applied to join the DFD at the next recruitment phase, which was in approximately May or June of 2017.

Conflict of Interest

[37] The defence argued that Ms. McGraw acted in a conflict of interest and showed favouritism by helping to evaluate Mr. Allen’s candidacy when he re-applied. I will review the evidence because the issue was canvassed in detail. But the issue is of marginal relevance. Again, the defence admitted that Ms. McGraw was terminated without cause. And Mr. Milliner was not aware of this alleged conflict when he fired Ms. McGraw. Certainly, he did not include it among the reasons for her termination. Therefore, the evidence on this point does not assist the defence by showing that Mr. Milliner acted without malice or bad faith or gender-based discrimination.

[38] When Mr. Allen re-applied after the altercation with Mr. Thompson, each of the four or five captains participated in the recruitment testing and interviews. Ms. McGraw participated in a meeting on June 5, 2017 at which the recruits were considered. She did not recuse herself when Mr. Allen was considered.

[39] Ms. McGraw testified that she was in a relationship with Mr. Allen when he re-applied, but according to Mr. Malynyk’s testimony, the relationship was not “on” at the time. He said that Mr. Allen was dating his (Mr. Allen’s) former girlfriend at the time. Mr. Allen was not directly asked if the relationship was on or off at the time he re-applied.

[40] Warren Gilkes, who was a captain at the time, testified that the alleged conflict wasn’t even thought of at the time.

[41] Mr. Malynyk was asked how it was a conflict that Ms. McGraw helped to evaluate his application if they were not dating at the time. Mr. Malynyk said it was a conflict because Ms. McGraw had co-signed for Mr. Allen’s house. This was seemingly contradicted by Mr. Allen’s evidence who had said that the house purchase closed 3½ months later on September 16, 2017. There was no evidence of when Mr. Allen and Ms. McGraw started dating for the second time or when they entered the purchase transaction.

[42] When Mr. Allen re-applied, the captains were asked to put their opinions in writing. Among the captains, there were mixed opinions on whether Mr. Allen should be re-hired. Ms. McGraw supported Mr. Allen’s candidacy.

[43] In cross examination, it was suggested to Ms. McGraw that she was in a conflict of interest regarding Mr. Allen’s candidacy. She said, “No, because I stated I had issues, so I was honest about that.” This evidence was not contradicted.

[44] The decision was Mr. Zeggil’s. Mr. Zeggil decided to re-hire Mr. Allen. He noted that the other firefighter involved in the altercation was permitted to re-join the force after his suspension. He felt Mr. Allen had an anger issue but was a good firefighter. He was reliable in his attendance. He lived in town meaning he could attend calls promptly. His regular employment was such that he could attend fires and emergencies during the day. This combination of attributes was hard to find.

[45] Overall, the evidence on the conflict issue was not clear. It is not clear whether the relationship was on or off. It is not clear whether Ms. McGraw disclosed the relationship. The issue would not, in any event, justify Ms. McGraw’s termination. In addition, it was condoned by Mr. Zeggil, who was her supervisor. There is no evidence that this issue influenced the decision to terminate Ms. McGraw’s employment. Furthermore, it arose in 2017 so was a stale issue by the time of Ms. McGraw’s 2019 dismissal.

After-Acquired Cause Defence Not Pursued

[46] The defendants advanced a great deal of evidence in an effort to show that Ms. McGraw and Mr. Zeggil were in a sexual relationship throughout the time he was chief and she was administrative assistant. The amended defence pleaded after-acquired cause on the basis that “If at the time of the dismissal, the Defendants had knowledge of the sexual relationship between the Plaintiff and the Fire Chief, Mr. Zeggil, they both would have been terminated for just cause.”

[47] Despite this pleading, the defence of after-acquired cause was not advanced at trial. Thus, it was not necessary for the defendants to try to prove there was a continuing intimate relationship between Ms. McGraw and Mr. Zeggil. Nevertheless, there was a great deal of evidence put forth on this issue.

Hotel Room at the Fire College

[48] Mitchell Dacruz testified that when he was at the fire college in 2018, Ms. McGraw and Mr. Zeggil both stayed at a hotel. In cross examination, Mr. Dacruz said that he did not know whether Ms. McGraw and Mr. Zeggil shared a room, just that they both stayed at the hotel.

[49] Ms. McGraw denied staying at a hotel with Mr. Zeggil. It was put to her that Mr. Zeggil ended his relationship with his common law spouse at around the same time. The implication was that Ms. McGraw’s relationship with Mr. Zeggil had something to do with the break down of his relationship with his common law spouse.

[50] In his examination in chief, Mr. Zeggil said he did not ever share a room with Ms. McGraw at the fire college and did not ever have sexual relations with her there. This issue was not addressed in his cross examination. Specifically, it was not put to him that he was mistaken or lying on this point. It was not put to him that his relationship with Ms. McGraw had something to do with his relationship with his common law wife ending.

[51] For what it’s worth, I prefer the evidence of Ms. McGraw and Mr. Zeggil to that of Mr. Dacruz. There is no reason not to accept their evidence on the point. There is too much potential that Mr. Dacruz is mistaken. There was no other evidence supporting Mr. Dacruz’s position on this point. In any event, Mr. Dacruz’s evidence was only that they stayed in the same hotel, not that they stayed in the same room. One cannot infer an intimate relationship from this evidence.

[52] I remain puzzled about the reason for calling this evidence. It was not relevant to the after-acquired cause defence because this defence was not pursued. Mr. Milliner was aware of the rumoured relationship between Ms. McGraw and Mr. Zeggil. His belief about this and the basis for his belief is relevant. However, Mr. Milliner did not interview Mr. Dacruz as part of his investigation. There is no evidence that Mr. Milliner was aware of the “hotel room” rumour when he fired Ms. McGraw. Therefore, this evidence was not relevant to his state of mind.

Car Parked at House

[53] Evidence was led by the defendants through several witnesses that Mr. Zeggil’s car was often seen parked at Ms. McGraw’s house. Most of the firefighters who testified either stated as a fact that his car was parked there often, or that they heard his car was parked there often. Kevin Sherson was one of the few witnesses if not the only witness who testified that he saw it there. It was not clarified if this was at the house where Ms. McGraw lived with Mr. Allen or where she lived before they moved in together.

[54] Although there were numerous witnesses who believed Mr. Zeggil and Ms. McGraw continued an intimate relationship, the evidence amounted to observations that they spent a lot of time together. Ms. McGraw was in a relationship with Mr. Allen throughout much of the time she was the administrative assistant. Mr. Malynyk testified that everyone called it the love triangle. There was no basis in the evidence for such a vicious rumour.

[55] Given the apparent enthusiasm for gossip within the DFD, I do not find the evidence suggesting Mr. Zeggil and Ms. McGraw continued their romantic relationship to be reliable or persuasive. Ms. McGraw and Mr. Zeggil both denied their intimate relationship continued beyond one occasion of intimacy. I believe their denials.

Turnover

[56] One of the points emphasized by the defendants right from opening statements was that there was a serious turnover issue at the DFD. Efforts were made during the trial to attribute this to Ms. McGraw.

[57] In her opening statement, defence counsel advised that firefighters would give testimony that they resigned or took a step back from the force because of the drama that took place between the plaintiff, Mr. Zeggil and Mr. Allen.

[58] In his testimony, Mr. Milliner said that turnover at the DFD prompted his investigation, which I will review later in these reasons.

[59] Ms. McGraw agreed there was regular turnover at the DFD but said this also occurs province wide. Ms. McGraw never heard any rumours that people were leaving because of her.

[60] In his examination in chief, Mr. Zeggil said he did not think there was a high turnover. In his cross examination, he was taken to his performance reviews which were conducted by Mr. Milliner.

[61] In a performance review dated December 4, 2017, Mr. Milliner commented that Mr. Zeggil needed to “Develop staff training and support to increase volunteer retention and reduce turnover.” Under, “Areas where employee needs improvement,” Mr. Milliner wrote: “Staff Retention + Morale.” Mr. Milliner did not suggest to Mr. Zeggil that this concern was connected to Ms. McGraw.

[62] In Mr. Zeggil’s performance review dated November 28, 2018, Mr. Milliner wrote “Don works hard at his job and takes it very seriously. Treat everyone the same and some have left the dept. because of not being treated the same + different rules apply for diff” [sic]. (This was likely a reference to Ms. Davison, whose evidence I will discuss below.) Mr. Zeggil replied: “Who is commenting on equal treatment? Disgruntled staff that was not participating.” Mr. Milliner also wrote: “Staffing challenges have been a problem for the Fire Dept. in the last couple of years. We need a plan and we need to find out why.” Mr. Zeggil responded: “If standards aren’t met then my job and career are liable as is the Township. There is no room for just whatever.” His point was that the municipality faced potential liability if training standards, including the standards for attendance at training, were not met.

[63] The November 28, 2018 performance review must be considered in context. Mr. Zeggil and Ms. McGraw came and met with Mr. Milliner in November of 2018 to tell him that she wanted to work more hours and to advise him that she was considering an opportunity in Kirkland Lake. Mr. Milliner could not commit to more hours. Mr. Milliner testified that he made the decision to terminate Ms. McGraw in December of 2018. He hired an HR consultant to assist him in dealing with Ms. McGraw in December of 2018. He consulted with the law firm Hicks Morley starting December 15, 2018.

[64] In his testimony including his re-examination about his performance evaluations, Mr. Zeggil said there was discussion to the effect that you can’t just “pick up someone off the street” to be a volunteer firefighter. He did not agree there was high turnover at the DFD and said there were no numbers to prove it. Turnover is an issue at volunteer fire departments because the volunteers need considerable training and commitment. He noted that in days gone by, when the fire bells rang people would drop what they were doing and attend the fire. He colourfully described that the meat cutter would come out of his shop still wearing his apron and respond to the fire. However, those days are long gone. Now, there is an expectation that even volunteer firefighters will be well trained and prepared, and there is potential liability if they are not. Many volunteers are simply not able to commit to attending calls and training. Many commute to work from the community where they live and volunteer and are not in a position to respond during the day. Volunteers who are consistently not able to attend calls may be asked to leave or may be dismissed. He said staffing is a constant issue for chiefs at volunteer fire departments. He denied that there was a high turnover, in effect leaving a challenge for the defendants to show it.

[65] During the trial, criticism about the alleged turnover issue was directed by the defendants primarily at Mr. Zeggil and not Ms. McGraw. During Mr. Zeggil’s testimony, no effort was made to tie the purported turnover problem to Ms. McGraw.

[66] In re-examination, Mr. Zeggil said that Mr. Milliner did not give any detail at all as to who was leaving because of the alleged favouritism or who was showing favouritism, and that he had no idea how to respond to the negative comment in his performance appraisal without that information. Further, Mr. Milliner did not say that Ms. McGraw was at the root of the alleged turnover, morale, or favouritism problem. Her name did not come up at all in this context. He said that Mr. Milliner had ample opportunity at the November meeting with him and Ms. McGraw to raise any concerns with either of them about favouritism or to confront them about the rumours of a relationship.

[67] The defendants did not meet the challenge inherent in Mr. Zeggil’s testimony to show that there was high turnover.

[68] The question of whether there was a high turnover was not systematically addressed in the defendants’ evidence. Mr. Milliner did testify that “between 2016, 2015, I would say 2016 to 2018 there was in the order of fourteen people that I am aware of.” However, there was nothing more precise than this from the defendants. The defendants made no effort to put into evidence a comprehensive list identifying who left, when they left, and why they left, or any documentation to support this claim. I do not accept Mr. Milliner’s evidence as to the number of resignations that occurred.

[69] The defendants only called evidence with respect to four resignations, which I will review in detail below, meaning that there is no evidence that Ms. McGraw was in any way responsible for ten of the resignations Mr. Milliner claimed had occurred. Mr. Milliner’s evidence is further undermined by the fact that, of the four resignations reviewed in evidence, discussed below, three occurred in 2014 or 2015, and one occurred in December of 2018 or January of 2019.

[70] In contrast, during the cross examination of Mr. Gilkes, it was established that from the date Ms. McGraw was fired to the date of trial in April 2021, fourteen volunteers left. Mr. Gilkes was taken, name by name, through a list of volunteers who left during that period. Mr. Gilkes was deputy chief after Ms. McGraw’s termination until December 31, 2020, so was well-positioned to give this evidence. The evidence went unchallenged by the defendants. The point was made that turnover remained high after Ms. McGraw left, suggesting she was not the cause of it. This evidence underlined the point made by Mr. Zeggil and others that retention of volunteers is difficult because being a volunteer firefighter is a serious commitment for very little pay, and it involves being ready to attend calls at all times of day or night when other priorities may exist.

[71] In the defence opening statement, it was asserted that, “In total, there were four resignations that were directly linked to the drama going on in the fire department and several other resignations that were suspected to be linked to this drama.” This is an overstatement when the evidence is considered because the decisions the four individuals made to leave were multi-factored. The four were Lori and Bruce Marshall, Kevin Sherson, and Jamie Davison. Except for Bruce Marshall, these witnesses all testified.

Lori and Bruce Marshall

[72] When Ms. Marshall testified, she said that when reviewing her phone bill, she saw that Mr. Marshall and Ms. McGraw had exchanged 311 text messages. This would likely have been in 2014. She threw her ring at Mr. Marshall, and he apologized. She did not testify as to the content of the messages and in fact she said she had not read them, and she had no clue what they were about. This incident was one of the reasons she “stepped back” from the fire department. The other reason was that her father got sick and needed full time care.

[73] In her examination in chief, Ms. McGraw said there was nothing inappropriate about the text messages. Beyond this, Ms. McGraw was not asked about the nature of the text messages. She said she was friends with Bruce Marshall. She said Ms. Marshall did speak to her about the issue. It was not her understanding that Ms. Marshall retired because of this. Ms. McGraw and the Marshalls are currently neighbours.

[74] Mr. Marshall stayed on as a volunteer for some time after that. He was a long-haul truck driver at the time so was away a lot. Ms. Marshall said that every time he would go to a call, she would get mad if Ms. McGraw was at the call. For these reasons, Mr. Marshall also “took a step back.”

[75] Mr. Marshall rejoined the DFD after Ms. McGraw was terminated for two reasons. First, Ms. McGraw was no longer there. Second, he was driving locally.

[76] Mr. Marshall had no trouble getting back on the DFD. Mr. Marshall was not disciplined at all for the text messages.

[77] Mr. Milliner did not interview Ms. Marshall about Ms. McGraw prior to terminating Ms. McGraw. He did try to speak to Mr. Marshall, but Mr. Marshall did not want to be involved because he was neighbours with Ms. McGraw.

[78] Ms. Marshall did not complain to then fire chief John Thompson or to Mr. Milliner about Ms. McGraw. She said she and Mr. Marshall thought they would just “keep it in our own house and our own living room.” However, clearly that did not occur as almost every witness from the DFD was aware of this incident, with various degrees of accuracy.

[79] Mr. Tamming pointed out that it takes two to text and suggested that a double standard was at play, in that Ms. McGraw’s termination was based in part on these text messages and Mr. Marshall was not disciplined and was re-hired despite them. He also pointed out that there is no evidence the text messages were sexual in nature.

[80] As these events occurred in 2014 or earlier, the effort to rely on them as significant to the issues in this trial was misplaced.

Kevin Sherson

[81] Mr. Sherson left the DFD because he was angry about what occurred during a call for a hydro pole fire. Mr. Zeggil was acting deputy chief at the time, according to Mr. Sherson, which likely puts this incident in 2015. Mr. Sherson was a captain at the time.

[82] In brief, Mr. Sherson said the protocol was that the first captain on scene typically took charge. The pump truck which Ms. McGraw was driving, and which Mr. Zeggil was in, drove past the scene. The rescue truck Mr. Sherson was in therefore arrived first. Mr. Sherson initially took charge of the scene but then Mr. Zeggil arrived and took command. Mr. Sherson thought that Mr. Zeggil pulled rank to “show off” to Ms. McGraw. Mr. Sherson was also upset by an instruction he later received from Mr. Zeggil, being that they should leave the rescue truck at the side of the road when it broke down on the way back to the station. Mr. Zeggil thought this unwise, and he and a colleague arranged for the rescue truck to be towed.

[83] Mr. Sherson was very upset after this. He spoke to then-Fire Chief Thompson and resigned. During the conversation, he told Mr. Thompson that it was not right that there was a relationship between Mr. Zeggil and Ms. McGraw and that they were working together. Mr. Thompson told him that what they did on their own time was their own business.

[84] Mr. Zeggil out-ranked Mr. Sherson so it is difficult to understand why this incident would have been so upsetting. The suggestion that Mr. Zeggil did this to “show off” to Ms. McGraw is implausible. When Mr. Zeggil testified, he was not asked any details about this incident, and it was not put to him that he showed off. In any event, it is way off the mark to blame Ms. McGraw for the incident or for Mr. Sherson’s resignation, or to use this incident to bolster the claim that Ms. McGraw was responsible for high turnover in the DFD.

[85] Mr. Milliner described that he conducted an investigation, which I will return to later in these reasons. When asked about his investigation, the first item in the chronology was that he approached Mr. Sherson in February of 2018 when they met at a hockey game in Owen Sound, to ask him if he would return to the fire department. His answer was no. Mr. Milliner said that Mr. Sherson was concerned about morale; Mr. Sherson told him there were pictures of Ms. McGraw sent to other people; he felt there was a relationship between Ms. McGraw and Mr. Zeggil; and he felt there was favouritism. Mr. Milliner then testified that Mr. Sherson told him about the hydro pole fire incident; however, Mr. Milliner related the story incorrectly, saying that Ms. McGraw had taken over the scene at the direction of Mr. Zeggil.

[86] This is emblematic of Mr. Milliner’s investigation. He misunderstood or misremembered the story Mr. Sherson had told him, and incorrectly attributed the blame to Ms. McGraw.

[87] When asked why he resigned, Mr. Sherson said because he was mad. The question was repeated, and he again referenced the hydro pole incident. He did not mention Ms. McGraw as among the reasons he resigned. When asked why he would not return, he did include among his reasons his belief that there was a relationship between Mr. Zeggil and Ms. McGraw.

Jaime-Lee Davison

[88] Jaime-Lee Davison (formerly Galbraith) was a volunteer firefighter with the DFD from 2016 until December 2018 or January 2019. She had completed a course of training at a fire college in Orangeville, which few other volunteers at the DFD had done.

[89] Ms. Davison testified that in 2017 or 2018 Mr. Zeggil approached her about her poor attendance. At that point she was doing schooling and was working in Flesherton which interfered with her ability to attend calls and practices. She agreed that her attendance could have been better. Then one day in December of 2018 or January of 2019 she was working in Dundalk, and she noted that the fire trucks had gone out of town, but she had not received a notification on the paging system. Mr. Zeggil had taken her off the system, so she was no longer getting notifications. She messaged Mr. Zeggil and he told her that she had clearly made her decision. She did not get any notification prior to being removed from the paging system. She had not been “written up” over her attendance. She acknowledged, however, that her training was not up to the 60% attendance mark, which I infer from Ms. Davison’s evidence was the required standard.

[90] Ms. Davison approached Mr. Milliner and said that in her mind there was preferential treatment. She said that there were people who were away even more than she was. She felt that Mr. Allen was getting special treatment because he was out west two weeks on and two weeks off, and he had assaulted someone and was brought back on. She was aware that Mr. Allen was in a relationship with Ms. McGraw and Ms. McGraw was very close to Mr. Zeggil, so she assumed Ms. McGraw had some pull with Mr. Zeggil.

[91] I did not hear evidence from any other witness that Mr. Allen was out west on a two-weeks-on-two-weeks-off basis. In her reply evidence, Ms. McGraw testified that when Mr. Allen was out west, he was on leave.

[92] Ms. Davison’s evidence must be evaluated bearing in mind that some of the important parts of what she said were not brought out from the witnesses who had first-hand knowledge. For instance, Mr. Allen was not asked about his attendance. He made one comment in his testimony that he was out west for a period of time, but the dates for this were not nailed down. The extent of his absences was not reviewed. It was not put to him that his attendance was poor, or that he received preferential treatment from Mr. Zeggil because he was in a relationship with Ms. McGraw. Mr. Allen did say that Ms. Davison attended only two calls. This was in the context of him being asked about turnover at the DFD, and individuals who left the department.

[93] Mr. Zeggil was not asked about Ms. Davison at all. It would not be just to conclude that Mr. Zeggil treated Ms. Davison unfairly when he was not even given a chance to provide his side of the story. Mr. Zeggil did emphasize that one of the reasons he accepted Mr. Allen back on the force was his good attendance and his availability to attend calls during the day because of his work schedule and proximity.

[94] In contrast, Ms. Davison in her own testimony acknowledged poor attendance.

[95] Ms. Davison’s testimony also suffered from her willingness to state as fact things that she appears to have heard from others. For instance, she stated insistently that Ms. McGraw had sent naked pictures to male firefighters. Specifically, she stated as a fact not only that naked pictures of Ms. McGraw were sent to male firefighters, but that it was Ms. McGraw who sent them. This is completely unsupported by the evidence in this trial and plainly was not within Ms. Davison’s first-hand knowledge.

[96] In result, I do not accept that Ms. Davison’s departure from the DFD can be fairly blamed on Ms. McGraw. Mr. Milliner told Southgate Council that Ms. Davison’s departure was due to “tension within the group,” and that “she just couldn’t stay there with those kind of working … relationships.” He implied her departure should be blamed on Ms. McGraw. This was inaccurate and unfair.

Intimate Photos

[97] I heard a great deal of testimony regarding intimate photos of Ms. McGraw being shared by her or by others, but very little direct evidence. Apart from hearsay and rumours, there was no evidence called at this trial that she shared intimate photos of herself with anyone other than Mr. Allen.

[98] Mr. Malynyk testified that early in his career with the DFD, he heard rumours from “the older generation” that nude photos were sent. There was always talk that Bruce Marshall, Warren Gilkes and Tim Brown got photos – rumoured to be naked photos. Mr. Malynyk started as an auxiliary firefighter in 2014, and from his testimony I infer that this was before his time.

[99] Multiple other witnesses said they had heard Ms. McGraw had sent naked photos of herself to other firefighters.

[100] Jaime-Lee Davison testified with absolute confidence that Warren Gilkes had received a naked photo of Ms. McGraw sent by Ms. McGraw. The photo was allegedly sent after Mr. Gilkes had helped Ms. McGraw with some painting. She said Mr. Gilkes told her he had deleted it after showing it to his wife. Even after it was put to her that it was not anticipated that Mr. Gilkes would say he actually received a photo from Ms. McGraw, but rather that he just heard they were being circulated, Ms. Davison testified that she was absolutely certain that Mr. Gilkes told her that he received a naked photograph of Ms. McGraw.

[101] When Mr. Gilkes testified, he denied what Ms. Davison had said. He said that he only ever received one picture from Ms. McGraw of herself. It was a picture of Ms. McGraw in her bunker gear. He said he did not tell Ms. Davison that Ms. McGraw had sent him an inappropriate photo. He may have said that Ms. McGraw showed him a picture of Ms. McGraw going to paint in her basement. He denied telling Ms. Davison that he showed his wife a photo of Ms. McGraw or that he deleted it.

[102] In her examination in chief, Ms. McGraw acknowledged sending provocative photos to Mr. Allen. In her cross examination, it was not put to Ms. McGraw that she had sent nude or provocative photos of herself to Mr. Marshall, Mr. Gilkes, Mr. Brown, or anyone else other than Mr. Allen.

The Radio Room Incident

[103] There was testimony from several sources that Mr. Allen received a photo of Ms. McGraw wrapped in a towel and that he showed this photo to about five other firefighters in the radio room at the fire hall. Mr. Allen denied that he had received such a photo while he was in the radio room or that he had shown such a photo to others.

[104] Mr. Malynyk testified that the radio room incident occurred right when Mr. Allen and Ms. McGraw started dating. He said this would have been in June or July of 2016. Mr. Allen was in the radio room because he missed a call which meant he was required to do certain paperwork. Mr. Malynyk said there were about five individuals in there. Mr. Allen was just going out on a date with Ms. McGraw and he said that she sent him a picture of her in a towel. Mr. Malynyk said Mr. Allen showed some of the guys the photo. Then one person for sure said they would sleep with Ms. McGraw and it started to go around. Mr. Malynyk said, “we can’t talk about that,” and he excused himself from the radio room. I understand from his testimony that Mr. Malynyk did not actually see the photo. He said that Cody McGrady was in the radio room and two or three others, but he could not recall who else was there.

[105] Mr. McGrady is a close family friend of Ms. McGraw and Mr. Allen. He was called to testify by the defence. He was in the radio room when Mr. Allen showed those present a photograph of Ms. McGraw in a towel. He thought this was in April or May of 2016. Mr. McGrady was 18 at the time. He did not think Ms. McGraw would ever have wanted the photographs shown.

[106] I accept Mr. Malynyk’s evidence and Mr. McGrady’s evidence over Mr. Allen’s evidence on this point.

[107] The final state of the evidence, then, about Ms. McGraw sending intimate photos of herself to other firefighters is this: except for the towel photo in the radio room, there is no evidence that she did. There is not a single witness who provided first-hand evidence that Ms. McGraw had sent another firefighter an intimate photo of herself, or that they had seen such a photo.

[108] This rumour that Ms. McGraw had done so circulated around the DFD for years. Ms. McGraw was not made aware of the rumour, but apparently many if not most others in the DFD were aware of it.

Confidentiality

[109] The defendants raised the failure to maintain the confidentiality of human resources information as a concern within the DFD. For the most part, it was not suggested that confidentiality issues were the fault of Ms. McGraw. An exception is an allegation that Ms. McGraw informed Mr. Allen of what was said in an April 2018 officer’s meeting.

[110] Mr. Dacruz testified that in an officer’s meeting in April 2018 he queried whether Mr. Allen would be willing to take orders or instruction from him. Mr. Allen is older than Mr. Dacruz but was lower in rank. Mr. Dacruz was aware of the 2017 incident between Mr. Allen and Mike Thompson and was aware of others’ comments that Mr. Allen had an anger management problem. The officer’s meeting was supposed to be confidential.

[111] Mr. Dacruz received a text message from Mr. Allen on April 25, 2018, shortly after the meeting.

[112] The text message said, “If you have a personal issue with my anger you can come talk to me about it with the chief and we will address it… no sure why you feel the need to bring it up when don says he’s hiring me on” [sic]. Mr. Dacruz was of the view that it was likely Ms. McGraw who had told Mr. Allen what was said in the meeting.

[113] When asked about this text message, Mr. Allen said Mr. McGrady, whom he said was Mr. Dacruz’s best friend, told him what Mr. Dacruz had said. He said that Mr. McGrady was not at the officer’s meeting.

[114] Mr. Dacruz was asked in chief whether Mr. McGrady was at the meeting and he said he was not. Mr. Dacruz said he had not told anyone about what he said at the meeting, but he was not specifically asked whether he had told Mr. McGrady about the concern outside of the meeting.

[115] Mr. McGrady testified before Mr. Dacruz but after Mr. Allen. He was not asked about this issue, about Mr. Allen’s evidence, or whether he (Mr. McGrady) was the source of Mr. Allen’s information.

[116] Ms. McGraw denied she told Mr. Allen what Mr. Dacruz had said at the meeting.

[117] The upshot is that there is no direct evidence that Ms. McGraw shared this confidential information with Mr. Allen. The direct evidence on the point was Mr. Allen’s evidence, and he said the information came from Mr. McGrady. Mr. Zeggil testified that, “Confidentiality is very hard to come by in Southgate,” and I accept this evidence. The circumstantial evidence that Ms. McGraw shared this confidential information consists only of the fact that she was at the meeting and at the time of the meeting she was in a relationship with Mr. Allen. I am not prepared to infer from this evidence that Ms. McGraw was the source of Mr. Allen’s information.

[118] This was another issue that was not raised by Mr. Milliner when he gave Mr. Zeggil and council his reasons for firing Ms. McGraw. There is no evidence Mr. Milliner was aware of it prior to Ms. McGraw’s termination. It cannot bolster the claim that he was not acting with malice or bad faith or discrimination and is another example of disparaging evidence being called with no real purpose.

Rumours Spread Outside of the DFD

[119] Mr. Milliner attempted to justify Ms. McGraw’s termination in part by stating that her presence tarnished the department. This position was based on rumours being spread outside of the DFD.

[120] Mr. Tamming called as a witness Ashley Milliner-Cowan, Mr. Milliner’s daughter. She is employed as an administrative assistant at the Orangeville Fire Department.

[121] Ms. Cowan has never met Ms. McGraw but her husband had met her. She has never communicated with Ms. McGraw.

[122] Ms. Cowan heard rumours about Ms. McGraw which she said were circulating among fire departments in the area. She said she heard these rumours over a period of quite a few months if not a year or more.

[123] She could not recall who she heard these rumours from or specifically how many times she heard them. The information she heard was that a female training officer from Dundalk was acting inappropriately and unprofessionally with other firefighters during courses and training operations. This firefighter had been flirtatious with other firefighters, specifically men. And she had been speaking inappropriately or in a non-professional manner to them.

[124] Ms. Cowan was not able to provide more detail than this.

[125] She testified that she heard the rumours on a number of occasions but even when pressed she could not identify a single person who she heard the rumours from, or over what period of time, other than it was definitely before Ms. McGraw was fired.

[126] In cross examination, Ms. Cowan advised that she could not say if the rumoured flirtatious conduct was just verbal or if there was a physical component to this alleged flirtation.

[127] Ms. Cowan shared the rumours with her father by pulling him aside during a family social gathering at his house. She told her father what she described to the court, and nothing else. That is, no specifics beyond Ms. McGraw’s name, perhaps, and that rumours were going about that she had been flirtatious and had acted inappropriately and unprofessionally. She felt she needed to tell her father because it had been grating on her and she cares about the DFD because she grew up there. She thought it was something that needed to be brought to his attention.

[128] Mr. Tamming also called Neil Cowan, who is Mr. Milliner’s son-in-law and Ms. Cowan’s husband. Mr. Cowan is a volunteer fire captain at the Grand Valley Fire Department. He has met Ms. McGraw once or maybe twice. One occasion was at the Dundalk Fall Fair and the other was at a pump operations course at the Grand Valley Fire Hall where Ms. McGraw was an instructor and he assisted in set up for the course. He said he did not have much dealing with her.

[129] Mr. Cowan testified that he had heard rumours about Ms. McGraw. He had a member in his squad come to him with allegations that at the fire college Ms. McGraw had made him uncomfortable with the way she was flirting with some of the other students that were in the course. This person did not give any detail about the flirting. Or how many people she was flirting with. Mr. Cowan did not have a firm memory of what he was told.

[130] Mr. Cowan had not heard anything else negative about Ms. McGraw. However, he felt that what he was told was something he should bring to Mr. Milliner’s attention as CAO, because it’s easy for smaller volunteer fire departments to catch a bad public relations image. He told Mr. Milliner about it at a family social event at Mr. Milliner’s house, which presumably was the same social event described by Ms. Cowan.

[131] Mr. Milliner took the name of this complainant, who is still with the Grand Valley Fire Department. Mr. Cowan did not know if Mr. Milliner followed up with this complainant. He did not.

[132] I find that Mr. Cowan’s information was the seed for Mr. Milliner’s “sex for grades” comments.

[133] I also find that when Mr. Milliner told council that “other fire chiefs know there is morale problems in our service,” his daughter and son-in-law were his sources. I will return to this because I consider Mr. Milliner’s comments to council to be improper inflation of rumours and significant in the assessment of punitive damages.

Allegation of Helping to Cheat on a Test

[134] Mr. Dacruz testified that in May of 2018, he and Ms. McGraw and Mr. Allen were all at the fire college at the same time. Mr. Dacruz was shadowing on a pump ops course. Ms. McGraw was instructing. Mr. Allen was there to re-write the pump ops exam which he had previously failed.

[135] Mr. Dacruz says he received information that Ms. McGraw and John Uptegrove had the AS&E test and were letting Mr. Allen practice on it. Mr. Dacruz texted with Derek Malynyk at that time and sent a text saying, “Wanna know what’s ridiculous Mel and upte have the asne test and are legit letting Corey practice on it.” He testified that “upte” was a reference to John Uptegrove and “asne” meant the AS&E test.

[136] Mr. Dacruz was not certain of the source of this information. He said, “I can’t remember exactly how I came across the information, but I was told that they had the AS&E testing and that’s how they were studying was the actual test and going over the test.” Study guides are widely available for these tests. Mr. Dacruz said that his information was that it was not a study guide they were studying from, but the actual test.

[137] Mr. Dacruz specifically said he did not make any personal observation of what they were studying from or address the issue directly with any of them. They told Mr. Dacruz they were going to meet up and study, and Mr. Dacruz elected not to join them for dinner.

[138] I told Mr. Dacruz that this was an important point, and directly asked him whether he was told this information by one of the three of Mr. Allen, Ms. McGraw, or Mr. Uptegrove. He said he believes he was told by someone else, not one of the three of them. He said he would have said something if one of the three of them told him, because he found this upsetting.

[139] The state of the evidence, then, is that Mr. Dacruz’s information that Ms. McGraw helped Mr. Allen cheat on a test is hearsay. It is particularly unreliable hearsay because there is a very considerable likelihood of miscommunication, misunderstanding, or misremembering. There is no admissible direct or circumstantial evidence from any source that Ms. McGraw helped Mr. Allen to cheat on a test.

[140] Mr. Uptegrove was not called as a witness.

[141] In cross-examination, Ms. McGraw denied that she provided a copy of a test to Mr. Allen or that she would have had access to the test. I accept this evidence.

[142] Mr. Allen was asked about this in cross examination. He denied that he was given a copy of the test. He said he had a lesson plan like every other firefighter. He studied off a list of books that is available for pre-exam testing. He said he had study guides and an app for his phone. I accept this evidence.

[143] Andrew Blair, a fire college instructor, testified that AS&E exams get taken out of their packaging just before the exam is written. It is the same process for students who are re-writing those exams.

[144] The result is that there is not only no direct evidence that Ms. McGraw helped Mr. Allen to cheat on a test, but also that it is improbable.

[145] Furthermore, Mr. Milliner did not interview Mr. Dacruz as part of his investigation. He did not testify that he was aware of the allegation made by Mr. Dacruz. The allegation was therefore not relevant to Mr. Milliner’s state of mind. Mr. Milliner did not mention this allegation to council or Mr. Zeggil as support for his decision to fire Ms. McGraw. Therefore, this allegation does not support Mr. Milliner’s claim that he did not act with malice, bad faith, or discrimination. Mr. Dacruz’s allegation was not pled as part of the after-acquired cause defence which was not pursued.

[146] The evidence on this point was simply not relevant to the issues and is another example of disparaging evidence being called with no real purpose.

David Milliner’s Investigation

[147] Mr. Milliner’s investigation consisted of:

a. his meeting with Mr. Sherson at a hockey game in February 2018 and one other call with him;

b. his meeting with Ms. Davison in February 2018;

c. interviewing Brent Russell in March of 2018;

d. an attempted interview of Mr. Marshall; and

e. information received from his daughter and son-in-law in the summer of 2018.

[148] Mr. Milliner also said he interviewed Warren Gilkes in the summer/fall of 2018, but Mr. Gilkes said he only spoke to Mr. Milliner about the issues after Ms. McGraw was fired. I believe Mr. Gilkes is correct about this because his evidence was more specific on this point and Mr. Milliner did not document the discussion.

[149] Mr. Milliner never obtained or saw any of the inappropriate photos that were allegedly circulated. He never spoke to a single person who had seen the photos first-hand.

[150] Mr. Milliner’s investigation did not include any discussion or interview with Mr. Zeggil or Ms. McGraw. Mr. Milliner heard the rumour that Mr. Zeggil and Ms. McGraw were in a relationship at least as early as February of 2018 from Mr. Sherson. Despite this, Mr. Milliner did not confront or interview either of them to ask about whether this was true. He heard the same rumour from Ms. Davison, and later from Mr. Russell and councillor Jim Frew. However, none of this prompted direct inquiries to Ms. McGraw or Mr. Zeggil.

[151] It is generous to call what Mr. Milliner did an “investigation.” For the most part, information came to him as opposed to him gathering information.

[152] The documentation of Mr. Milliner’s investigation consists of a single memo he wrote on February 19, 2018, to which he later added some undated handwritten notes. The memo focussed on the retirement of Lori and Bruce Marshall and contained inaccuracies and one-sided information. The memo references the possibility of obtaining statements from potential witnesses but not a single statement was obtained.

[153] Mr. Milliner came to incorrect conclusions because he relied so extensively on inaccurate and dated second-hand information.

[154] In his testimony, the last activity Mr. Milliner described as part of his investigation was the undocumented conversation he had with Mr. Frew, which was in September 2018. No explanation was offered for why it took from then until December 2018 for him to decide to fire Ms. McGraw.

HR Consultant

[155] In December 2018, Mr. Milliner engaged HR Consultant Ben Cornell for advice regarding the termination of Ms. McGraw.

[156] Hiring an HR consultant might be expected to help insulate an employer from liability for discrimination and bad faith in termination. However, Mr. Cornell was misled by Mr. Milliner about the circumstances, and he did not make his own inquiries.

[157] Mr. Milliner contacted Mr. Cornell about this matter in December of 2018. Mr. Milliner told him Mr. Zeggil and Ms. McGraw “were causing some morale problems.” Mr. Milliner advised that Ms. McGraw had “distributed some photos to some of the firefighters”; “she had a certain reputation at the fire college”; and “there was a concern that she was having a relation with her boss the fire chief.”

[158] It is significant that this was the only alleged misconduct that Mr. Milliner described to Mr. Cornell. That is, only sex-related concerns.

[159] Mr. Cornell advised Mr. Milliner that as there was no proof of the allegations, dismissal for cause was not possible.

[160] According to Mr. Cornell’s evidence, Mr. Milliner was very concerned that the fire department was in a state of crisis and that the fire department would soon be unable to provide emergency services to the residents of Southgate. A significant theme of Mr. Cornell’s testimony was that the situation was urgent. So urgent that progressive discipline could not be considered. Mr. Cornell is aware of an employer’s duty of good faith and agreed that this duty would normally include making an effort to interview the subject of an investigation, but he felt that “because of the urgency and the pervasiveness of the problem it is something you could skip.”

[161] The alleged state of crisis and the urgency of the situation does not square with the recorded conversations Mr. Milliner had with council or his recorded conversation with Mr. Zeggil, discussed below. At no time during these conversations did Mr. Milliner suggest that the DFD was in crisis or that there was a risk the DFD would be unable to respond to emergencies. I heard no evidence of any calls that the DFD did not respond to, because it was understaffed or for any other reason.

[162] The alleged urgency also does not square with the timing. Mr. Milliner did not describe any activity in his investigation immediately prior to December of 2018. He described nothing that suggested a crisis was brewing in late 2018. The last departure of a firefighter that he described was Ms. Davison, who he met with in February of 2018. If the issue was urgent, Ms. McGraw could have been fired long before she was. There is no explanation for why it took until December of 2018 to hire the HR consultant and why it took from December until February to fire her after the HR consultant had been consulted.

[163] I conclude that the alleged crisis and urgency is something that was exaggerated by Mr. Cornell in his testimony to explain the limited analysis he conducted and to try to support his client’s case. There was no valid reason not to take the time to interview Ms. McGraw.

The Recorded Meeting Between Milliner and Zeggil

[164] The closed-session council meeting I have already described took place on February 6, 2018. Later the same day, Mr. Milliner met with Mr. Zeggil. The purpose of the meeting was to advise Mr. Zeggil that Ms. McGraw was about to be terminated and to explain the decision.

[165] A poor-quality audio recording of the meeting was later recovered. Mr. Zeggil testified there was a “Nest” camera with audio in his office. He said it usually sat in his office window which looked out on the parking lot. He said it was not him who had it installed but he was aware of it. I understood from his evidence that its purpose was so that the Chief could remotely monitor to see if there were enough resources responding to calls, but the camera had fallen down behind some furniture, so it was not recording any useful video. The video portion shows what appears to be the back of some furniture or perhaps a floor or baseboard.

[166] Mr. Milliner said he was aware there was a camera in the garage bay area that was supposed to monitor for mischief in the fire hall. He was not aware that it recorded audio and was not aware that the camera was picking up audio of the meeting.

[167] When asked if he was aware at the time that he was being recorded, Mr. Zeggil said he did not clue in that it might be taped. It was later that he realized the camera was there and it does record audio, so the conversation would have been recorded. Because of the nature of the recording, its poor quality, the video which is consistent with it having fallen behind furniture, the content of the recording, and the timing of its recovery, I accept this is true. I do not think Mr. Zeggil was mindful that the conversation was being recorded at the time.

[168] A transcript of the recording was prepared in two parts which became lettered exhibits only, as it was inaccurate. I have listened carefully to the recording and below I quote directly from it, not from the transcript.

[169] In the meeting Mr. Milliner, initially reading from a script prepared by Mr. Cornell, informed Mr. Zeggil he was going to be firing Ms. McGraw without cause. The reasons Mr. Milliner gave to Mr. Zeggil were similar to those he gave to council, which I summarized above.

[170] Mr. Zeggil did not accept what he was being told. He wanted to know the sources of Mr. Milliner’s information. Mr. Milliner would not say, except at one point he did advise one source was Rick Duck. However, Mr. Milliner then said that Mr. Duck “didn’t say nothing negative but it was the way he – we just had a good conversation and I – Rick’s a good guy, but he kinda – the way he kinda didn’t say stuff it’s like – it’s not like it used to be.” I heard no other evidence that Mr. Duck was a source of information.

[171] Mr. Zeggil’s reaction was that the problem was that a female was doing well and others were “backstabbing.”

[172] The following are some of the more significant comments made:

Zeggil: …I’ll step down too.

Milliner: No. Why would you do that?

Zeggil: Because I know what’s going on here.

Milliner: It’s not just here, Don.

Zeggil: I been here 20 years and I see a female doing well.

Milliner: It has nothing to do with – it’s nothing to do with female.

Zeggil: Yeah, it is. It’s – it’s people backstabbing and it’s in Dundalk huge. So, it’s not worth the time of day.

Milliner: Okay. So let me share one with you right now, and it doesn’t leave this room. It does not leave this room. How do you pass a course at fire college?

Zeggil: How do you pass a course? You write the test.

Milliner: You can sleep with Melanie McGraw. That’s what I was told.

Milliner: There’s too many problems. …

Milliner: I’ve had at least five people talk to me that have either been associated with the service in the past or present.

Zeggil: There’s been rumours going on, Dave, about everybody in this fire department now and again.

Zeggil: If you’re going to give into those insults of people then I’m out – because I been living in here for 25 years and tomorrow will be a different one.

Zeggil: She’s got all the credentials this department needs …

Milliner: I don’t disagree with that. … She says she’s got the credentials to be deputy chief right now. I don’t disagree.

Zeggil: She’s not wrong.

Milliner: … She’s been doing her job. But it’s the baggage that comes with it.

Milliner: You think it’s okay to go and represent us at the fire college and have that sh** come back?

Zeggil: …I’m saying it’s bullsh**. It’s bullsh**. Somebody’s got it out for her.

Milliner: You think it’s okay to send nude photos of yourself to some other [fire department volunteer staff]?

Milliner: [I was told that] by more than one person.

Milliner: People quit over it.

Milliner: I know of two services that know about this and they think … I don’t even have to ask about it. I don’t have to ask about it. I run into this sh**. They think it’s a big joke.

Zeggil: You don’t have anything. You’ve got hearsay, and if you want to support that, I will not.

Milliner: You see I believe in my people too, but when they go off the rails this bad -- when they go off the rails this bad -- well, you’re not facing reality.

Zeggil: Yeah, I am. I’ve lived reality for 25 years in Dundalk.

Zeggil: You can’t give me proof, give me proof. You’re hearsay. And I’ve heard it all before.

Milliner: Why don’t you make some phone calls.

Zeggil: Give me the names, I’ll make some phone calls because -- give me the names. It’s hearsay.

Milliner: I have no proof of any other things that are going wrong here, I just know everything centres around one individual. And, I mean, that type of performance, if not gone unchecked, it’s going to continue.

Zeggil: … I’ve heard rumours about other fire departments. I don’t run to the CAO and say, did you hear this about that, it’s not -- did you hear positive things about going on here?

Milliner: They never tell you positive.

Zeggil: Exactly. You’re listening to the bullsh**.

Milliner: I think you need to go speak to someone.

Zeggil: No, I need to support the people that have worked hard for me.

Milliner: But how can you -- how can you support them when –

Zeggil: Because it’s bullsh**.

Milliner: – there’s too many messages.

Zeggil: No there isn’t. It’s gossip, it’s hearsay and you’re getting sucked into it. I’ve seen it, heard it.

Zeggil: Somebody’s losing their job because of what somebody’s said. Tell me who they are. Let her defend herself.

Zeggil: She’s given up 10 years of her life to build what she’s built here and you’re giving in to hearsay.

Milliner: I mean, she got compensated for it, I mean we paid what the rates were that she agreed to and, hey, thank you very much.

[173] Mr. Milliner spent part of the conversation trying to get Mr. Zeggil to support the decision, or to acknowledge Mr. Milliner’s authority to make the decision, or at least not to resign. At no time, including during this conversation, did Mr. Milliner address with Mr. Zeggil that there were rumours he and Ms. McGraw were in a romantic relationship.

[174] During cross examination about the “sex for grades” comment, this exchange occurred:

A: … I had the intention of getting Mr. Zeggil to understand that there are rumours in other fire services that, we have a problem. … And maybe I embellished it. I will give you that. I wish –

Q: Let’s take away the maybe and let’s say you did embellish it. Wouldn’t you agree with that statement? You made it up, Mr. Milliner?

A: Fine. I made it up.

Termination

[175] The next day, February 7, 2019, Mr. Milliner and the township clerk, Ms. Hyde, met with Ms. McGraw and advised her of her termination. At the meeting, Mr. Milliner again read from a script prepared by Mr. Cornell. Ms. McGraw was not given any reason for her termination but was told it was without cause. She was shocked and tearful.

Post Termination Events

[176] Mr. Zeggil resigned as fire chief that same day. Mr. Allen called a meeting at the fire hall. There was considerable controversy over whether Mr. Allen suggested they all turn in their pagers en masse. For the purposes of this case, nothing turns on this.

[177] Later, Mr. Allen attended at Mr. Milliner’s office and loudly resigned as a firefighter, calling Mr. Milliner “every name in the book.” He caused a scene that was apparently witnessed and heard by other municipal employees. He resigned from his two seasonal positions with the township. He was banned from entering township property.

[178] Despite being banned from township property, on March 6, 2019 Mr. Allen attended a council meeting and spoke from the podium. He played part of the recorded conversation between Mr. Milliner and Mr. Zeggil. Several witnesses testified that they could not make out what was said on the recording although, of course, the council members were already aware of what was said.

Analysis

[179] Ms. McGraw claims damages under five headings: (i) reasonable notice; (ii) moral damages; (iii) OHRC damages; (iv) defamation; (v) punitive damages.

Reasonable Notice

[180] As indicated, it is not alleged that Ms. McGraw was fired for just cause. However, the parties did not agree on the amount of reasonable notice that she should have been given before termination.

[181] Ms. McGraw’s length of service was ten years as an auxiliary and then volunteer firefighter and then fire captain, and three years as the part time administrative assistant. She was age 41 at the time she was fired.

[182] Ms. McGraw resides in Dundalk about one kilometre from the fire hall. Given the geography, finding another firefighter position of any kind in the surrounding area would not have been possible unless she moved.

[183] There was no evidence regarding how difficult it might be to find a similarly remunerative administrative assistant position. In the absence of such evidence, I conclude that finding such a position would likely have been much less of a challenge.

[184] In determining reasonable notice, both positions should be considered, giving appropriate weight to each: Starcevich v. Woodward’s Ltd., (1991) 1991 330 (BC SC), 58 B.C.L.R. (2d) 254, at para. 28 to 29.

[185] I find that reasonable notice before terminating Ms. McGraw’s positions would have been six months.

[186] If the parties have any difficulty calculating the damages based on this finding after deducting the statutory entitlements she was paid, I may be spoken to.

Mitigation

[187] When she was fired from the DFD, Ms. McGraw was also working in Kirkland Lake earning more money than she earned in Dundalk. The defendants argue the two jobs were incompatible or mutually exclusive and the income from Kirkland Lake should be considered mitigation. Therefore, they say, no damages should be awarded beyond the statutory entitlement Ms. McGraw was paid.

[188] I agree that in the long term, working one job in Dundalk and one in Kirkland Lake would not be sustainable for most people. However, it was demonstrated to my satisfaction that if she had not been fired, Ms. McGraw would have continued to work both positions for some time as she hoped a full time position at the DFD would open up. Mr. Zeggil was trying to get Southgate to hire a deputy chief due to his workload. As already described, in the November 2018 meeting involving Mr. Zeggil, Ms. McGraw and Mr. Milliner, Ms. McGraw told Mr. Milliner she hoped to work more hours. Mr. Milliner acknowledged that there was a strategy going forward to look at increasing the staffing within the fire department. Whether that was for more hours or a full time position was up for discussion.

[189] I accept that Ms. McGraw would have preferred to stay in Dundalk, where her roots had been planted, that she believed there were reasonable prospects for a full time position, and that she would have been willing to work for less pay than she was earning in Kirkland Lake. Mr. Zeggil supported her in her dual employment and was prepared to allow her to work flexible hours. I am satisfied that if she had not been fired, Ms. McGraw would have worked both positions for quite some time in the hope that a full time position at the DFD would come through – likely more than the six months of reasonable notice I have assessed.

[190] It follows that the amounts Ms. McGraw received from her employment in Kirkland Lake were not “amounts received in mitigation of loss”: Brake v. PJ-M2R Restaurant Inc., 2017 ONCA 402, at para. 96 and at para. 140, citing S.M. Waddams, The Law of Damages, loose-leaf (Rel. Nov. 2016), 2d ed. (Toronto: Canada Law Book, 1991), at para. 15.780. If Ms. McGraw was not fired, she would have earned both incomes for at least six months.

Moral Damages

[191] Ms. McGraw claims moral damages arising from the manner of her dismissal. Moral damages are available 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”: Wallace v. United Grain Growers Ltd., 1997 332 (SCC), [1997] 3 SCR 701, at para. 98; Honda Canada Inc. v. Keays, 2008 SCC 39, [2008] 2 SCR 362, at para. 57 and 59; Colistro v. Tbaytel, 2019 ONCA 197, at para. 57.

[192] In Wallace, Justice Iacobucci said:

the loss of one’s job is always a traumatic event. However, when termination is accompanied by acts of bad faith in the manner of discharge, the results can be especially devastating. In my opinion, to ensure that employees receive adequate protection, employers ought to be held to an obligation of good faith and fair dealing in the manner of dismissal, the breach of which will be compensated for by adding to the length of the notice period.

[193] In Keays, the Supreme Court of Canada reaffirmed the principles of damages for mental distress, or aggravated damages, or “Wallace damages,” “but characterized them as deserving of a distinct category of damages known as moral damages”: Galea v. Wal-Mart Canada Corp., 2017 ONSC 245, at para. 222. The concept of moral damages replaced the idea of simply “bumping-up” the notice period as a remedy for a breach of the duty of good faith: Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26, at para. 41.

[194] Moral damages may be founded on a broad array of conduct. They are not limited to cases where the employee is marched out the office door in front of colleagues or otherwise humiliated at the moment of dismissal. Justice Iacobucci in Wallace cites multiple examples at paras. 99 through to 102. He also noted a limiting concept, at para. 103:

It has long been accepted that a dismissed employee is not entitled to compensation for injuries flowing from the fact of the dismissal itself: see e.g. Addis, supra. Thus, although the loss of a job is very often the cause of injured feelings and emotional upset, the law does not recognize these as compensable losses. However, where an employee can establish that an employer engaged in bad faith conduct or unfair dealing in the course of dismissal, injuries such as humiliation, embarrassment and damage to one’s sense of self-worth and self-esteem might all be worthy of compensation depending upon the circumstances of the case. In these situations, compensation does not flow from the fact of dismissal itself, but rather from the manner in which the dismissal was effected by the employer.

[195] In 2020, in Matthews, at para. 40, the Supreme Court of Canada confirmed that the conduct the court examines is “not confined to the exact moment of termination itself.” Speaking for the court, Justice Kasirer said:

[H]ad the issue been properly placed before the trial judge, it was certainly within the trial judge’s prerogative to tie the dishonesty that occurred over the four-year period to the “manner of dismissal”. Due to the circumstances in Wallace and Keays, “in the manner of dismissal” was originally conceptualized as the moment of dismissal, suggesting to some degree that good faith must exist only at the very end of the employment relationship. … [T]here is no coherent reason why the measure of misconduct cannot be understood retrospectively in cases of wrongful dismissal “so long as it is ‘a component of the manner of dismissal’.” [Citations omitted.]

[196] As Ms. McGraw was given no reasons for her termination, it cannot be said that the defendants were untruthful or misleading to her. However, the defendants did engage in conduct “during the course of dismissal” that was unfair and in bad faith.

[197] Ms. McGraw relies on Joshi v. National Bank of Canada, 2016 ONSC 3510, at para. 26, for the proposition that an employment contract includes an implied obligation to afford the employee due process and allow the employee to respond to allegations of misconduct. Joshi was a pleadings motion and not a trial. I do not suggest that an employer is obliged to give an employee the reasons for termination, but I agree that the failure to allow an employee to respond to allegations of misconduct can be considered part of the “conduct during the course of the dismissal” and can be a factor in determining whether moral damages should be awarded.

[198] In this case, the defendants’ own HR consultant, Mr. Cornell, acknowledged the duty of good faith would normally include making an effort to interview the subject of an investigation.

[199] Support for this view is also found in Peoples v. Ontario (Ministry of Training, Colleges & Universities), 2008 CarswellOnt 7706, where a manager was the subject of an investigation that resulted in a conclusion that her management style contributed to a dysfunctional environment. Justice Tausendfreund awarded the plaintiff an additional four months’ salary as “additional damages” (citing Wallace and Keays). The employer did not review the findings of the investigator with the employee and afford her an opportunity to respond. The employer also did not allow the employee an option to address the perceived shortcomings in her management style and did not offer courses or training to her or follow a progressive discipline approach. Peoples was cited with approval by the Court of Appeal in Doyle v. Zochem Inc., 2017 ONCA 130, at para. 24.

[200] Here, the unfairness to Ms. McGraw was exceptional. The defendants acted on unfounded, sexist allegations relating primarily to conduct from years prior, without properly ascertaining the truth and without even asking Ms. McGraw about the allegations. Mr. Milliner conducted an amateurish investigation. He conflated gossip with facts. Without justification, he accepted the allegations and assumed the worst of the fire department’s only two paid staff. He failed to recognize the patent gender-based discrimination directed at Ms. McGraw.

[201] I am satisfied that Ms. McGraw suffered significant mental anguish because of the bad faith conduct of the defendants. Ms. McGraw had a deep-rooted interest in remaining in Dundalk and was committed to the community. She initially declined the Kirkland Lake option because she wanted to stay in Dundalk. Even after accepting the Kirkland Lake position, she maintained her positions at the DFD because she hoped that a full time position would open up in Dundalk. With her termination, no options for working with a fire service in her community remained. She testified, and I accept, that her role was something she loved doing for the community. I accept that losing this role under the cloud of false allegations was distressing.

[202] For the most part, the allegations against Ms. McGraw were fantastical. They were made in a male-dominated environment. The defendants ought to have been highly suspicious that the allegations were based on discrimination. The failure of the defendants to support Ms. McGraw against discrimination was a significant, distressing failure.

[203] In her demeanour, Ms. McGraw generally seemed quite stoic, but she testified, and I accept, that she has a hard time talking about the allegations leading to her termination. She was heartbroken. She found herself sobbing after learning of the contents of the recorded conversation between Mr. Milliner and Mr. Zeggil.

[204] Ms. McGraw was proud of being one of the female instructors at the fire college and she could not comprehend how the allegation that she might give grades for sex could even be made.

[205] The circumstances have been hard on Ms. McGraw’s family. The circumstances were exceptionally difficult due to the small size of the community and the knowledge that “confidentiality was very hard to come by” in the DFD. Ms. McGraw’s daughters have heard comments. The events were also difficult for her relationship with Mr. Allen.

[206] Ms. McGraw described being embarrassed at the thought of going to the grocery store with her daughter after she learned from Mr. Tamming’s office the contents of the recorded closed session of council, which only came out during the trial.

[207] Ms. McGraw did have a history of situational depression and anxiety and was on medication which required adjustment after she was fired.

[208] In my view, the circumstances justify a significant award of moral damages.

[209] The defence argues that Mr. Allen’s post-termination actions, including playing the recording at a public council meeting, were a significant contributor to any mental distress on the part of Ms. McGraw. However, I heard several witnesses say that Dundalk is a small community and suggest that everybody knows everybody else’s business. I do not accept that Mr. Allen’s actions caused her distress, but rather once she learned what was being said about her, that Ms. McGraw expected everyone would be talking about her anyway. She was not aware that Mr. Allen intended to play the recording at a council meeting. Afterwards, however, she felt that Mr. Allen was being protective and trying to defend her.

[210] Bearing all the foregoing in mind, in my view, an appropriate figure for compensation to Ms. McGraw for moral damages is $75,000. This amount is compensatory damages. It is focused on Ms. McGraw’s loss arising from the manner in which her employment was terminated, and the resulting embarrassment and humiliation, and not on the defendants’ misconduct.

Section 46.1 of the OHRC

[211] Under s. 5 of the OHRC, “Every person has a right to equal treatment with respect to employment without discrimination because of … sex,” and “Every person who is an employee has a right to freedom from harassment in the workplace by the employer or agent of the employer or by another employee because of … sex.”

[212] Under the OHRC, it is not necessary for Ms. McGraw to show that the defendants intended to discriminate against her: Ont. Human Rights Comm. v. Simpsons-Sears, [1985] 2 SCR 536, 1985 18 (SCC), at para. 14.

[213] To demonstrate prima facie discrimination, Ms. McGraw must show that she has a characteristic protected from discrimination under the Code; that she experienced an adverse impact with her employment; and that the protected characteristic was a factor in the adverse impact. Once a prima facie case is established, the burden shifts to the defendants to justify the conduct, within the framework of the exemptions available under human rights statutes. If it cannot be justified, discrimination will be found to have occurred: Moore v. British Columbia (Education), 2012 SCC 61, at para. 33.

Patent Gender-Based Discrimination

[214] The defence argues that there was no gender-based discrimination. They argue that there were issues in the DFD and one of the permanent positions needed to be terminated. The municipality is legally obligated to have a fire chief. They argue that as between Mr. Zeggil and Ms. McGraw, terminating Ms. McGraw made the most business sense.

[215] First, I do not accept the factual premise of this argument. The evidence does not support the conclusion that Mr. Milliner thought firing Mr. Zeggil or Ms. McGraw was an “either/or proposition.” Throughout the recorded conversation between Mr. Milliner and Mr. Zeggil, Mr. Milliner does not express a hint of dissatisfaction with Mr. Zeggil. To the contrary, he said, “I have no proof of any other things that are going wrong here, I just know everything centres around one individual.” He clearly did not want Mr. Zeggil to resign. Even in the defence submissions, it is stated that the defendants were considering the termination of Mr. Zeggil “if the problems in the force persisted.”

[216] It is likely that if Mr. Zeggil had supported Mr. Milliner’s decision to terminate Ms. McGraw, or if he had gone along with it, Mr. Milliner would have been content to keep Mr. Zeggil on.

[217] Second, the justifications offered (e.g., morale and turnover problems) do not to justify Ms. McGraw’s termination within the framework of the exemptions available under human rights statutes. An example of justifiable discrimination by an employer might be discrimination which cannot be avoided through accommodation to the employee, because the accommodation would cause undue hardship on the employer. There is nothing of this nature in the facts of this case. It was not an option for the defendants to discriminate against Ms. McGraw on the basis that this was necessary to fix a morale or turnover problem at the DFD.

[218] Third, the justifications offered are themselves discriminatory. The embellishment or fabrication involved in re-telling the “sex for grades” allegation is clearly borne of gender-based stereotypes and discrimination. The comments that Ms. McGraw had the qualifications to become deputy chief and that she had been doing her job, “[b]ut it’s the baggage that comes with it” are themselves a damning example of discriminatory conduct.

[219] The facts are not subject to misinterpretation. Ms. McGraw was marginalized in a toxic, male-dominated workplace. Her termination was based on unfounded sexist allegations.

Damages for Discrimination

[220] With respect to the quantum of damages for discrimination, Mr. Tamming says there are no comparable cases and suggests damages of $75,000. Ms. Vassalli points the court to Farris v. Staubach Ontario Inc., 2011 HRTO 979, where $30,000 was awarded.

[221] Although neither of the parties cited it to me, Strudwick v. Applied Consumer & Clinical Evaluations Inc., 2016 ONCA 520 is essential to the analysis. Justice Epstein set out the governing principles for the assessment of damages under s. 46.1. The starting point is the text of s. 46.1, which permits the court to order a party to who infringed the right of another party “to pay monetary compensation to the party whose right was infringed for loss arising out of the infringement, including compensation for injury to dignity, feelings and self-respect.”

[222] Referring to Keays, Justice Epstein noted, at para. 55, that “damages in this context are not designed to punish the employer but rather remedy the effects of discrimination.”

[223] At para. 59, Justice Epstein cited Lane v. ADGA Group Consultants Inc. (2008), 2008 39605 (ON SCDC), 91 O.R. (3d) 649 for the propositions that: (1) there is “no ceiling on awards of general damages under the [Code]”; (2) the quantum of general damages must not be set “too low, since doing so would trivialize the social importance of the [Code] by effectively creating a ‘licence fee’ to discriminate”: and (3) factors to be considered include “humiliation; hurt feelings; the loss of self-respect, dignity and confidence by the complainant; the experience of victimization; the vulnerability of the complainant; and the seriousness of the offensive treatment.”

[224] At para. 62, Justice Epstein cited with approval Sanford v. Koop, 2005 HRTO 53, at para. 38, which held that further considerations included the immediate impact and the ongoing impact of the discrimination and/or harassment on the complainant’s emotional and/or physical health; the complainant’s vulnerability; whether the complainant or others objected to the offensive conduct; the discriminating party’s knowledge that the conduct was not only unwelcome but viewed as harassment or discrimination; the degree of anxiety the conduct caused; and the frequency and intensity of the conduct.

[225] At para. 61, Justice Epstein adopted the statement in Arunachalam v. Best Buy Canada, 2010 HRTO 1880, at para. 53, that “dismissal from employment for discriminatory reasons usually affects dignity more than a comment made on one occasion.”

[226] The trial judge in Strudwick had assessed the damages under s. 46.1 at $20,000. Justice Epstein found this too low, increasing the assessment to $40,000 in the facts of that case.

[227] The employer’s conduct in Strudwick had a significantly confrontational and abusive element that is not present here. The false rumours about Ms. McGraw were all shared behind her back and were not shared by the employer, but by her colleagues. Ms. McGraw did not provide evidence that she was aware of the toxic environment. She did not suggest that her employment was stressful or unpleasant because of the toxic environment. She has not made a claim that the conduct by her colleagues was harassment or that the defendants are responsible for it.

[228] On the other hand, Ms. McGraw’s lack of awareness of the sexist allegations against her would make the sting more acute when she learned what was being said. It was made more hurtful that she wasn’t given a chance to address the allegations. She was deprived of the possibility of seeking a remedy by, for instance, making a harassment complaint to her employer.

[229] The defendants did not inform Ms. McGraw why she was fired, but in that environment, it could be expected that her colleagues would think the worst. The humiliation and injury to her dignity are acute.

[230] I must bear in mind the concern about duplication of damages. Further, the damages for discrimination must represent compensation for Ms. McGraw, not punishment to the defendants. With all these considerations in mind, I assess the damages for loss arising out of the gender-based discrimination at $35,000. Had I not awarded moral damages, I would have awarded more under this head of damages.

Defamation

The Statements Were Defamatory

[231] The amended amended statement of claim alleges that the “sex for grades” comment that Mr. Milliner made to both Mr. Zeggil and the town council were defamatory. It also alleges that the following statements that Mr. Milliner made to town council were defamatory: that Ms. McGraw engaged in inappropriate behaviour; that she texted inappropriate pictures of herself to other firefighters; that the fire department was not being respected because of Ms. McGraw’s conduct; and that Ms. McGraw’s conduct was letting down those who put the fire department uniform on in the past and carried themselves professionally. I agree that these statements were defamatory, i.e., false statements to her discredit or disrepute (Raymond E. Brown, Brown on Defamation: Canada, United Kingdom, Australia, New Zealand, United States, loose-leaf, 2d ed., vol. 8 (Toronto: Carswell, 1999), at s. 4.2(2)). The statements were untrue and would tend to lower the reputation of Ms. McGraw in the eyes of the community.

[232] The fact that some of the statements were related as rumours does not matter:

“[A] person who repeats a defamatory statement is generally as liable as the one who first utters it” …. If the rule were otherwise, and a bare rumor or report could justify the retailing of defamatory information, “character would be at the mercy of the artful and designing”, and any defence could be manufactured beforehand to suit the circumstances.

The law will not protect a publisher merely because he or she couches a defamatory comment in the form of a report or rumour. … It is no justification for the defendant to prove that he was merely repeating what he was told by others, or to assert that it is true that that the allegation was made and that someone else originally circulated the information, and it was a current rumour which the repeater believed was true, even if it is reported as hearsay… This has come to be known as the “repetition rule” whereby the defamatory statement of someone else repeated by a defendant is to be treated the same as if it originated with the defendant. “Talebearers are as bad as talemakers.” [Brown at s. 7.7. Citations omitted.]

Qualified Privilege

[233] It is also straightforward that the words were spoken on occasions of qualified privilege. Mr. Tamming argued that Mr. Milliner had no duty to report to council the reasons he decided to terminate Ms. McGraw’s employment. I disagree. I accept the defence position on this point, which is supported by extensive authority, including Hill v. Church of Scientology of Toronto, 1995 59 (SCC), [1995] 2 SCR 1130, at para. 143; Prud'homme v. Prud'homme, 2002 SCC 85, [2002] 4 SCR 663, at para. 49; and Foulidis v. Baker, 2012 ONSC 7295, at para. 42 to 46.

Malice

[234] The real question is whether the claim for qualified privilege is defeated by malice or recklessness.

[235] A good statement of the controlling law is found in RTC Engineering Consultants Ltd. v. Ontario, (2002) 58 O.R. (3d) 726, 2002 14179 (ON CA), at para. 18:

Not everything said or written on an occasion of qualified privilege is protected. As is evident from the term “qualified privilege” itself and from the previous discussion, the privilege is not absolute. It may be lost in one of two ways. First, it may be lost if the dominant motive for making the statement was malice. In this context, malice means not just ill will towards another but any ulterior motive that conflicts with the interest or duty created by the occasion. And it includes recklessness. Both dishonesty and a reckless disregard for the truth may amount to malice. Second, a privilege may be lost if the statement is not commensurate with the occasion, either because the statement is not germane and reasonably appropriate to the occasion or because the recipients of the statement have no interest in receiving it. Put differently, to maintain privilege a defendant must communicate appropriate information to appropriate people. [Citations omitted.]

[236] I agree with the defence argument that Mr. Milliner had a responsibility or duty to explain his decision to council, and that council had a corresponding duty to receive the information.

[237] However, the statements were made recklessly. Furthermore, the “sex for grades” comment (“they are saying that if you want to pass the fire college there’s ways to do that and be entertained at night too”) was made dishonestly. The statement was not just untrue. It went far beyond any of the “rumours” that were related to me in this trial. Mr. Milliner acknowledged that he embellished the rumour and effectively he made up this allegation.

[238] A defendant is acting maliciously if he or she makes a defamatory statement knowing it is false, or having no reason to believe it is true, or with reckless disregard of whether it is true or false: Brown, at s. 16.2(1). At the same time:

“[T]he court will not look too narrowly on the language used”…. A “defendant is not confined to saying what is strictly necessary to the occasion”. The fact that the words are insulting does not necessarily make them malicious. Minor embellishments and “mere immoderation in the language”, or words reflecting bad taste and want of sound judgement, will not defeat a privilege which is otherwise honestly pursued. …

Isolated expressions should not be examined hypercritically. A court should not too readily draw an inference of malice from mere exaggeration or extravagance in the use of language. … The language must be extreme before an inference of malice will be drawn. [Brown, at 16.4(3)(a). Footnotes omitted.]

[239] I have reviewed many of the examples in Professor Brown’s text and find by comparison that the statements here, particularly the “sex for grades” comment, are extreme and go far beyond what was necessary or appropriate for the occasion. The discriminatory nature of the comments and the discriminatory nature of Mr. Milliner’s purpose for relating them are also factors which I have considered in concluding that the qualified privilege is defeated.

[240] I therefore find that Mr. Milliner is not protected by qualified privilege.

Damages for Defamation

[241] Damages for defamation “are awarded primarily to compensate the plaintiff for the harm caused to his or her reputation, and secondarily for any hurt or injured feelings the publication may have caused”: Brown, at s. 25.3(1); footnotes omitted.

[242] My assessment of damages takes no account of the repeated slander Ms. McGraw suffered at the hands of her DFD colleagues, none of whom were named as defendants. It was not argued that there should be compensation on this account.

[243] In addition, there is an overlap between the nature of damages for defamation, for discrimination, and for moral damages in wrongful dismissal cases. Courts have held that damages for humiliation and for injury to dignity, feelings and self-respect are compensable for all three of these causes of action. Again, seeking to avoid duplication of damages, I have tempered my damages assessment for defamation accordingly.

[244] The statements were made on only two occasions. In cross examination of Mr. Zeggil, the defence made the point that he continued to hold Ms. McGraw in high esteem, so the impact of the defamatory remarks to him was limited.

[245] Nevertheless, the remarks were appalling. Although the audience was limited, the individuals were important people in Ms. McGraw’s life. The defamatory remarks resulted in council unanimously approving Ms. McGraw’s termination. Bearing these factors in mind, I assess the damages for defamation at $20,000.

[246] Had I not made awards for moral damages and discrimination, I would have awarded more for defamation.

Punitive Damages

[247] In Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419, at para. 79 to 80, the Court of Appeal stated:

To obtain an award of punitive damages, a plaintiff must meet two basic requirements. First, the plaintiff must show that the defendant’s conduct is reprehensible: in the words of Binnie J. in Whiten, “malicious, oppressive and high-handed” and “a marked departure from ordinary standards of decent behaviour”: see Whiten, at para. 36. Second, the plaintiff must show that a punitive damages award, when added to any compensatory award, is rationally required to punish the defendant and to meet the objectives of retribution, deterrence and denunciation.

When the claim against the defendant is for breach of contract, as is Boucher’s claim against Wal-Mart, the plaintiff must meet a third requirement. The plaintiff must show that the defendant committed an actionable wrong independent of the underlying claim for damages for breach of contract. In Canada, this requirement originated in the Supreme Court of Canada’s judgment in Vorvis, itself a case about a breach of an employment contract, and was later affirmed in Whiten, at paras. 78-83.

[248] I am mindful that, although “[t]he same factual matrix is considered in setting all the heads of damages,” there should be no duplication in the award of damages. As Justice Emery noted in Galea, at para. 301, “Although the same facts form the basis of awarding punitive damages as those for awarding damages of a compensatory nature, the plaintiff is not awarded ‘double compensation.’”

[249] In Strudwick, at para. 113, Justice Epstein said: “What justifies punitive damages ultimately is the conclusion, in exceptional cases, that compensatory damages are simply insufficient to respond to the conduct being addressed.” In my view, in this case, the total compensatory damages I have assessed (six months notice plus $130,000) are sufficient compensation but insufficient to respond to the conduct being addressed.

[250] Here, the defendants’ discriminatory conduct was reprehensible and was a serious departure from ordinary standards of decent behaviour for a municipality and its CAO. The behaviour calls to mind a different era. It has long been recognized that this type of behaviour has no place in the workplace. Male-dominated workplaces, in particular, must be mindful to avoid gender-based discrimination. The fact that Ms. McGraw was in a position of authority and therefore a potential target for sexist behaviour and rumours was lost on the defendants. The circumstances call out for an award of punitive damages.

[251] The conduct which most readily fits within the classic test for punitive damages – “high handed and malicious conduct” – is the embellishment or fabrication of the “sex for grades” comment. However, there are other examples of Mr. Milliner improperly inflating “rumours” to justify Ms. McGraw’s termination.

[252] For instance, the issue of inappropriate photos was grossly inflated. The concern over photos was a primary justification given by Mr. Milliner for Ms. McGraw’s termination. It was not based on evidence.

[253] Mr. Milliner said to council he had heard through sources “that other fire chiefs know there is morale problems in our service.” To Mr. Zeggil, he said a chief from another fire department “has told somebody on council, a member of council” that the morale problem “is a rumour he hears.” The only evidence at trial of Mr. Milliner’s sources from other fire departments were his daughter and son-in-law, and neither of them testified that they had information from other fire chiefs. There was no other reference to a “member of council” who said he or she had heard a rumour from a fire chief in another fire department. Mr. Milliner’s invocation of the authority of other fire departments was unfounded, and he did not reveal to council that his sources were related to him.

[254] Mr. Milliner’s assertion that there was high turnover due to Ms. McGraw was seriously exaggerated.

[255] Mr. Milliner’s appeal to the honour of the uniform and his suggestion that it was let down by Ms. McGraw is particularly offensive given that it was based on stereotypes and given that Ms. McGraw had in fact been very much a professional.

[256] I find that the motivation to terminate Ms. McGraw’s employment was largely based on outdated stereotypes and the anachronistic view that Ms. McGraw was tarnishing the reputation of the DFD

[257] A further aggravating factor in the assessment of punitive damages is the fact that Ms. McGraw’s integrity was attacked by the defendants, but the allegations were not proven. The unlikely and improbable allegation that Ms. McGraw gave Mr. Allen a copy of a fire college test was pursued through trial, apparently on the strength of Mr. Dacruz’s evidence, which turned out to be hearsay. This is equivalent to an unfounded and unproven allegation of fraud. The allegations that Ms. McGraw acted in a conflict of interest and that she breached the confidentiality of a meeting were also pursued and not proven.

[258] A mitigating factor for punitive damages is that Ms. McGraw did not describe being aware of the conduct on a sustained basis or, for example, being stressed out about going to work because of it. On the other hand, the allegations circulated for years and Mr. Milliner’s mindset and his investigation was sustained over a period of about a year.

[259] A further mitigating factor is that the defendants did not profit from their wrongdoing.

[260] Finally, the fact that the corporate defendant is a small rural municipality is also a factor I have considered in moderating the award. A meaningful but moderate punitive damages award will provide an adequate specific deterrent to Southgate that might not be adequate for a different defendant.

[261] Bearing these factors in mind, I assess punitive damages of $60,000.

Overall Award

[262] In assessing damages, I have considered the appropriateness of the overall amount assessed, being six months compensation in lieu of notice plus $190,000, made up of $75,000 for moral damages, $35,000 for damages for discrimination under the OHRC, $20,000 for damages for defamation, and $60,000 for punitive damages. I have reviewed multiple cases with similar features and have tried to ensure that my award reasonably aligns with the overall awards in these cases. I have reviewed the Table of Mental Distress Damages Awards and the Table of Punitive Damages Awards commencing at para. 6:100 and para 6:128 of Hon. John R. Sproat, Employment Law Manual, loose leaf (Rel. 6, 8/2021) (Toronto: Thomson Reuters Canada Ltd., 2021). I have also specifically reviewed and considered: Galea; Johnston v. The Corporation of the Municipality of Arran-Elderslie, 2018 ONSC 7616; Colistro; Wallace; Keays; Downham v. Lennox (County), 2005 45197 (ON SC); Boucher; and Headley v. City of Toronto, 2019 ONSC 4496.

[263] Comparing cases is difficult as a multitude of factors will always be involved in an assessment of damages. But to the extent possible, it is important that similar cases are treated similarly. While the cases are fact-driven and fact-specific, it is easy to find parallels between some of the facts of these cases and the case before me.

[264] A significant feature in the assessment of damages here is that moral damages, damages for discrimination, damages for defamation, and punitive damages all may involve consideration of Ms. McGraw’s humiliation, injury to dignity, injury to self-respect, and like considerations. I have been mindful not to duplicate the awards on this basis. At the same time, I have tailored the awards to reflect the different purposes that these types of damages serve. The moral damages primarily compensate for mental distress arising from the manner of termination. The OHRC damages primarily compensate for injury to dignity, feelings and self-respect arising from discrimination. The damages for defamation compensate for injury to reputation caused by the offending statements. The punitive damages primarily reflect the need for denunciation and deterrence.

[265] In my view, an overall award of $190,000 does compare appropriately when the facts of all these cases are considered and compared to this case.

Costs

[266] If the parties are unable to agree on costs, they may contact the trial coordinator to arrange a hearing.

“Chown J.”

Released: October 20, 2021