COURT FILE NO.: CV-19-615817

DATE: 20211101

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Code Red Security and International Investigation Group Incorporated, Plaintiff

AND:

Sheraton Centre Toronto Hotel and Blake Mitchell, Defendants

BEFORE: Pollak J.

COUNSEL: Osborne G. Barnwell, for the Plaintiffs

Jeffrey Levine & Guneev Bhinder, for the Defendants

HEARD: April 28, 29 and May 4, 2021

ENDORSEMENT

[1] This is a Simplified Procedure action involving a dispute between the Plaintiff, Code Red Security and International Investigation Group Incorporated (“Code Red”), and the Defendants, Mr. Blake Mitchell (“Mr. Mitchell”) and Sheraton Centre Hotel Toronto (“Sheraton”).

[2] The Plaintiff emphasizes that it is a “minority” owned incorporated business that is “owned and operated by Chinnety Dawkins [“Mr. Dawkins”], a Black Jamaican man”. It was incorporated in 2014 and provides security services, including standby services during labour disputes.

[3] Mr. Mitchell is a director of security at Sheraton. He called Mr. Dawkins, the principle of the Plaintiff, about the potential provision of security services. The Plaintiff’s claim is for payment of services provided to the Defendant Sheraton, as well as punitive damages against the Defendants.

[4] The parties agree that “standby services” are meant to give an employer peace of mind when a union is considering strike action during labour negotiations. Such services provide an employer with peace of mind by ensuring an ability to access needed security services (thereby permitting the employer to maintain its operations). Standby services are different from other security services, such as those provided during an actual strike.

[5] The Defendants deny that they entered into an agreement for the performance of standby security services. They do not claim, as an alternative, that the performance of the standby services was deficient. Rather, they claim that they never entered into any standby services agreement with the Plaintiff. They also submit that the damages claimed by the Plaintiff are excessive.

[6] To support its claim for payment of the standby services it allegedly performed, the Plaintiff relies on a series of emails. It submits that these emails are evidence of an offer and acceptance at an agreed price for the standby services in question.

[7] In addition to its contractual claim, the Plaintiff argues that the conduct of Mr. Mitchell was deceitful and in bad faith because he must have known that standby services were performed and that they are different from the actual deployment of security services during a strike.

[8] The theory of the Plaintiff’s case for bad faith is that such was demonstrated by the various unreasonable and changing grounds relied on to justify refusal to pay the invoice and the lack of justification for such a position.

[9] Mr. Dawkins further urges this court to consider his submissions on the following:

No doubt that since the Black consciousness movement, which arose as a result of George Floyds murder on May 25, 2020, the topic of anti-Black racism, should no longer be a taboo which previously was clouded by fear by Black people of reprisal or punishing conduct. It is submitted that in this day and age, post George Floyd, Mr. Dawkins should be allowed to speak about his perceptions and share his lived life experiences as a Black man and explain why these facts leave him with the view that his race may very well be a factor in this challenge he has faced and is facing. Indeed, anti-Black racism is given judicial notice, but it is accepted that one must show some evidence why such vice is seen as being present.

In this regard, it is submitted that one manner in which discrimination could be proven involving a minority person, is whether the reasons given for the denial of say a service, have shifted. In this case, it is submitted that there have been shifting reasons why a contract was never formed. In essence, the credibility of the alleged perpetrator when judged in the context of the glaring facts pointing to a contrary opinion, creates a reasonable basis for such conclusion that race may have very well played a part in the conduct at issue.

It is submitted that while no claim for damages to dignity and self-respect is made, it open to the Court that such conclusion could flow out of these facts, then a larger award of punitive damages should be awarded. Mr. Dawkins submits that the allegation is not that he was consciously mistreated because of his race but there is what his lived experiences teach him that his race could subconsciously be seen as a basis to trivialize him. As he noted in his affidavit, the manner of his treatment was worrisome. Witness the matter of the mediation which, unfortunately, was so bothersome that both Counsel, who is also Black, had to walk out of the mediation.

[10] The Defendants submit that the Plaintiff’s allegations with respect to punitive damages, the personal liability of Mr. Mitchell, the claim for the tort of deceit, and the breach of duty of good faith have no basis in fact and law.

ISSUES

[11] In this trial, the issues are:

(a) Did Code Red and Sheraton form a contract under which Code Red was to provide standby security services to Sheraton?

(b) If so, what damages ought to be awarded to Code Red?

(c) Is Mr. Mitchell personally liable for the damages, if any?

(d) Did Sheraton or Mr. Mitchell commit the tort of deceit or breach the duty of good faith?

[12] The Plaintiff submits that it has proven:

(a) That there was a contract for standby services as all the elements of a contract – offer, acceptance, and consideration – have been met

(b) That there was deceitful and bad faith conduct which should attract punitive damages

(c) That it can be inferred, given what the Plaintiff sees as an in your face blatant denial of the obvious, that there may be more at issue than the merits of the case and, given his lived experiences, this may relate to his race as a Black man

(d) That Mr. Mitchell cannot be believed and should be liable

(e) The damages as claimed should be allowed

[13] The theory of the Defendants is that there was no actual strike. According to the Defendants, the description of the Plaintiff’s services available upon an actual strike must be differentiated from standby services. The Defendants submit that they were only seeking security services in the event a strike actually occurred.

[14] For the reasons below, I find that the evidence supports a conclusion that the Defendants requested and agreed to the standby services performed by the Plaintiff, at the price suggested by the Plaintiff.

[15] The evidence is that Code Red was one of the three security companies that Mr. Mitchell contacted. Code Red is a well-established security company with over 500 employees. The principal of Code Red is Mr. Chinnety Dawkins, who has known Mr. Mitchell for about 20 years. After an initial discussion regarding the possibility of Code Red providing external support, Mr. Mitchell asked Mr. Dawkins to provide Code Red’s information to be forwarded to the Executive Committee.

[16] Sheraton’s unionized employees were in a legal position to strike on October 24, 2018. To get things in order for a possible strike, Mr. Mitchell testified that, on October 15, 2018, he asked Mr. Dawkins about arranging a walk-though of the Sheraton Hotel. He advised Mr. Dawkins that the unionized employees would be in a legal position to strike on October 24, 2018.

[17] On October 15, 2018, Mr. Dawkins testified that he sent Mr. Mitchell a proposal for 72-hour standby services, which included a cost breakdown of Code Red’s services. The proposal included estimates for 72 hours of services with 10 security guards, 3 investigators, and 3 vehicles.

[18] On October 20, 2018, Mr. Mitchell responded, questioning the need for the vehicles in the cost breakdown. He indicated that he expected a non-aggressive strike, “[i]f there is one at all”. Mr. Dawkins then removed the vehicles from the cost breakdown. Mr. Mitchell responded that he would “forward off to finance and GM.” Shortly after receiving the quote, Mr. Mitchell did send it to the Executive Committee.

[19] Mr. Mitchell testified that on October 22, 2018, he emailed Code Red that Sheraton would be looking to start coverage “depending on an official strike or not” on October 24. Mr. Mitchell also advised that he was still planning the logistics of the command center for all security parties and would provide Code Red with an update on October 23, 2018. Mr. Mitchell then sent Mr. Dawkins a draft temporary services agreement for Code Red to fill out. (However, see 23 (iii) for the actual wording of the email)

[20] That same day, Code Red marked up the draft temporary services agreement and sent a copy to Mr. Mitchell. Mr. Mitchell submitted the markup of the temporary services agreement to the Executive Committee.

[21] Mr. Mitchell testified that he did not communicate with Code Red on October 23 because he had not received an update from the Executive Committee concerning union negotiations.

[22] His evidence is that by October 26, 2018, Sheraton’s negotiations with the union were progressing well and the Executive Committee made an order to hold off on taking further steps regarding any external support.

[23] The Plaintiff relies on the following emails, which summarize the evidence set out above:

(i) Email sent by Mr. Mitchell to Mr. Dawkins on October 15, 2018 at 11:01 a.m. He advised that he would like to have Mr. Dawkins do a walk-through of the property as he had been “given a legal strike date of October 24, so would like to get things in order for the possibility of a strike”

(ii) October 20, 2018 at 12:19 p.m., Mr. Mitchell sends the Plaintiff’s proposal to what he calls the Executive Committee

(iii) Monday, October 22, 2018 at 2:14 p.m. (2 days after sending the proposal re: pricing of service to the Executive Committee) Mr. Mitchell sends Mr. Dawkins a contract to be signed and advises that “We are going forward to having your team on board” and are “looking to start the coverage (depending on official strike or not) on Wednesday morning at 7.00 a.m.” Mr. Dawkins completes and signs the contract, and then returns it. (This is the email that the Plaintiff relies on to evidence the acceptance of the offer and the formation of the contract)

(iv) Email dated October 22, 2018 at 10:22 a.m. (the same day that Mr. Mitchell indicates he was bringing Code Red on board), Mr. Dawkins writes to Mr. Mitchell to reserve an area as a temporary center on October 23, at 6:00 p.m., as he would “like to have my first operative deployment on site for 7 p.m. for the 12 a.m. vote”. Mr. Mitchell responds at 10:49 a.m. and indicates that he would know later in the afternoon whether there was a planned walk out and that, yes, a command center would be set up

(v) Thursday, October 25, 2018 at 1:16 p.m., Mr. Dawkins writes to Mr. Mitchell and seeks an update “in respect to deployment tomorrow morning”. Mr. Mitchell responds on the same day at 4:05 p.m. that he was waiting on the decision and then states “the Executive Committee does not understand the necessity of being prepared to mobilize” and that he was not sure what the delay was “as all things are pointing to full strike tomorrow”

(vi) Friday, October 26, 2018 at 9:16 a.m., Mr. Dawkins emails Mr. Mitchell “just want to confirm that the 72 hours stand by is up as of Saturday, October 27^th” and that “I’ll recommend that we move forward and book an additional 44 hours, so that our security and investigative operatives could be placed in standby mode”

(vii) There is no email response to Mr. Dawkins email of October 26, 2018

(viii) Email dated Sunday, October 28, 2018 at 9:16 p.m., Mr. Dawkins sends an invoice to Mr. Mitchell for $32,950.80. The message was “Here’s your invoice! We appreciate prompt payment. Thanks for your business!”. (The invoice was exactly the same as the proposal the Plaintiff submits was approved on October 22, 2018)

(ix) On October 28, 2018 at 9:28 p.m., Mr. Mitchell responds by email citing Invoice 1070 from Code Red and states: “We have not been given any indication that we are to be on standby with your team yet. As per conversation we are on a hold until further notice. Can you clarify this invoice please”

(x) On October 29, 2018 at 6:36 p.m., Mr. Mitchell emails that “We are currently on hold for moving with any external support. We are not on standby or in a state of readiness. The current level is extremely cooperative and peaceful. I will update everyone when the two sides are back at the table”

(The words in bold reflect the wording which is emphasized by the Plaintiff)

[24] Mr. Dawkins’ evidence is that Code Red provided standby services from October 22, 2018 to October 27, 2018. He testified that Code Red provided an extra 48 hours (between October 22-24) of the services at no charge. The Plaintiff submits that the evidence is that Code Red was always contracted to provide standby services and that Mr. Mitchell took no issue with this until he realized that no strike was likely to occur. The Plaintiff submits that Mr. Mitchell only wove a tale of having no authority after the standby services were performed. It submits that this was in bad faith, deceitful, and unconscionable.

[25] The evidence of Mr. Dawkins is that on the expiration of the standby services from October 24, 2018, he advised Mr. Mitchell that the service would end on Saturday, October 27, 2018. He also suggested another 44 hours could be provided.

[26] When he received the invoice, Mr. Mitchell emailed back that:

We have not been given any indication that we are to be on standby with your team yet. As per conversation we are on a hold until further notice. Can you clarify this invoice please?

[27] On October 29, 2018, he further advised:

We are currently on hold for moving with any external support. We are not on standby or in a state of readiness. The current level is extremely cooperative and peaceful. I will update everyone when the two sides are back at the table. (Particularly, the words in bold)

[28] The Plaintiff submits that these emails (particularly the words in bold in the paragraph 23 above) are evidence of dishonesty and deceit. Code Red was ready to deploy personnel with strike coverage.

[29] The Plaintiff also emphasizes that Mr. Mitchell never advised Mr. Dawkins that there must be a definite strike occurring before Code Red was to provide the 72-hour standby services. Further, it says that there is no evidence that Mr. Mitchell advised Mr. Dawkins that he did not have the authority to contract for the standby service, or that, unless a strike was to proceed, standby services would not commence.

[30] In contrast, the Defendants argue that the parties knew, or ought to have known, that no contract was formed. The Defendants rely on (i) the surrounding circumstances of the discussions between Code Red and Sheraton, (ii) the parties’ words and conduct during their negotiations, and (iii) the conduct subsequent to the alleged agreement.

[31] Mr. Mitchell testified that the need for external support to provide services, standby or otherwise, would only arise if there was a strike because Sheraton’s internal team had adequate resources to address any security needs during the ongoing employee demonstrations. He also testified that when a union makes the decision to strike, it provides notice before commencing strike action. Mr. Mitchell did not provide the court with any credible explanation for his use of the bolded words in the emails referred to above in paragraph 23.

[32] The Defendants also rely on evidence that Code Red was aware of standby services that are provided only after a strike event is scheduled. Code Red provided examples of “contracts” which, according to Code Red itself, “represent exactly what is involved in stand-by services”. One of the contracts that Code Red refers to is a strike event that had been scheduled for the City of Toronto. The standby in that case came into effect after a strike event was scheduled.

[33] The Defendants also submit that Code Red knew, or ought to have known, that Mr. Mitchell was merely planning the logistics and was not the one making the final decision. The Defendants highlight the following evidence:

(a) As part of the process, Mr. Mitchell asked Mr. Dawkins on a call to provide him with Code Red’s company information which he could (and did) submit to the Executive Committee at Sheraton

(b) After doing a walk-through with Code Red employees, Mr. Mitchell requested a preliminary quote from Code Red that he could (and did) submit to the Executive Committee

(c) When Mr. Mitchell asked Mr. Dawkins to revise the proposal, he expressly requested the updated attachment so he could submit it to “finance and GM”

(d) The temporary services agreement that Mr. Mitchell sent to Mr. Dawkins to fill out included a signature line for Sheraton with Tim Reardon listed as the signatory, not Mr. Mitchell.

[34] The Defendants argue that the following conduct of the parties is also evidence that there was no contract:

(a) Despite Code Red requesting a temporary command centre for its personnel, paperwork, and gear, it is undisputed that no Code Red personnel, paperwork, or gear ever arrived at a temporary command centre. Sheraton never finalized the logistics of the command centre as the need for external security support never arose. (However, I note that the emails reveal that Mr. Mitchell confirmed that he would set up a command post).

(b) Code Red has provided no evidence to show that Sheraton confirmed with Code Red that it should start providing its security services.

(c) Code Red has provided no record similar to the email notification stating, “standby payment in effect” that Code Red relies on to support the argument that this email shows “exactly what is involved in standby services”. (I find that this is not required in light of the other evidence before me).

(d) On October 25, Mr. Mitchell indicated to Code Red that he was “still waiting on a decision” and further noted that “Unfortunately the Executive Committee does not understand the necessity of being prepared to mobilize”. (I find that the balance of the emails does not establish that there was no contract).

(e) The next day, Mr. Mitchell communicated to Code Red that there was an executive order of holding off until the upcoming Monday. (I find that this occurs after the contract was already formed).

(f) On October 28, 2018, upon receipt of Code Red’s invoice, Mr. Mitchell responded within 11 minutes requesting clarification for why Code Red was invoicing Sheraton as he had given no indication to Code Red to commence its services. (This also occurs after the contract is formed).

[35] The Defendants therefore submit that a reasonable interpretation of the surrounding circumstances of Code Red and Sheraton’s discussions, the October 22 email exchange, and the subsequent conduct of the parties shows that the parties did not enter into a contract for security services.

[36] Where parties are engaged in negotiations, the test of reasonableness of the offeree’s expectations in all the circumstances ought to apply. I do not accept the Defendant’s submissions. The words used in the email chain in evidence, support a different version of the events. I find that the Plaintiff’s evidence supports a finding that Code Red was on standby from October 22-24, 2018, and from October 24-27, 2018.

[37] In my view, a reasonable person would conclude that a contract had been formed based on the various emails exchanged between the parties. Those emails reveal that the Plaintiff was asked to provide a proposal for standby services and to include a quote for the price of such services. A proposal was then submitted to Mr. Mitchell and a change was requested by the Defendants. The proposal was then sent to finance and the general manager at Sheraton. Mr. Mitchell then advised by email that the Sheraton will have them “on board” and the Plaintiff was asked to fill in a supplier contract. This supplier contact was then submitted to the Defendants.

[38] In light of the evidence, I am of the view that a contract for standby services was reached between the Plaintiff and the Defendants.

[39] As mentioned, the Plaintiff also claims punitive damages. The law is clear that punitive damages are only awarded in extraordinary circumstances. The Defendants rely on Ontario Ltd. v. Welsby & Associates Taxation Inc., 2003 11902 (ON SC), wherein the court held, at para. 86, that “such awards are rare in contract cases” and require an independent actionable wrong.

[40] To support its claim for punitive damages, the Plaintiff emphasizes that the Defendants position as to why the invoice for $32,000 should not be paid has changed over time. Initially, the Defendants advised that the reason for the refusal to pay was that Sheraton had not hired the Plaintiff to do any work. Subsequently, Mr. Mitchell advised that he had no authority to make the decision to hire the Plaintiff and that he required approval from the Executive Committee. Finally, the Defendants argued that because there was no strike, there was no need for standby services. The Plaintiff submits that this last ground of denial is not consistent with the acknowledged purpose of engaging the Plaintiffs’ services – namely, to provide peace of mind while negotiations were still ongoing.

[41] Mr. Mitchell testified that he wished to get things together for the possibility of a strike but never wished for Code Red to offer standby services. He testified that he did not want the Plaintiff to do standby services as he had to wait for Executive Committee approval. He denied that Sheraton would be concerned about the legal strike expected on October 24, 2018, and stated that “once there is an actual strike date provided by the Union, then there would be a 72 hour stand-by service and in this case, there was no actual date provided”.

[42] The legal requirements to justify an award of punitive damages are set out by the Court of Appeal for Ontario in Fernandes v. Penncorp Life Insurance Company, 2014 ONCA 615, 122 O.R. (3d) 192. There, Pepall J.A. stated, at para. 74:

The law relating to punitive damages was canvassed in detail by the Supreme Court in Whiten and addressed again more recently in Fidler. The key applicable principles may be summarized as follows.

-Punitive damages are designed to address the objectives of retribution, deterrence and denunciation, not to compensate the plaintiff: Whiten, at paras. 43 and 94, and Fidler, at para 61.

• They are awarded only where compensatory damages are insufficient to accomplish these objectives: Whiten, at para. 94.

-They are the exception rather than the rule: Whiten, at para. 94.

-The impugned conduct must depart markedly from ordinary standards of decency; it is conduct that is malicious, oppressive or high-handed and that offends the court's sense of decency: Whiten, at paras. 36 and 94; and Fidler, at para. 62.

-In addition to the breach of contract, there must be an independent actionable wrong: Whiten, at para. 78, and Fidler, at para. 63.

-In a case of breach of an insurance contract for failure to pay insurance benefits, a breach by the insurer of its contractual duty to act in good faith will constitute an independent actionable wrong: Whiten, at para. 79, and Fidler, at para. 63.

[43] In support of its claim, the Plaintiff does not rely on direct evidence of racial discrimination. Instead, Mr. Dawkins testified that his life experiences, which have negatively impacted his life, as well as the manner in which this case unfolded, left him with concerns that his difficulties here must have been related to that “WHITE ELEPHANT” in the proverbial room, where, despite the new Black consciousness, no one feels comfortable discussing underlying biases. The Plaintiff asks this court to consider the underlying reasons for this dispute, as well as the inexplicability of the Defendants’ conduct, and argues that it necessitates an inquiry as to whether Mr. Dawkins’ concerns are reasonably held.

[44] The Plaintiff submits that the emails in evidence were written before the invoice was sent and accurately set out the dealings between the parties. The Plaintiff submits that, sadly, what appears to have occurred, is that, once Mr. Mitchell felt that the Sheraton was not likely to have a strike, he changed his position.

[45] The Plaintiff criticizes the evidence of Mr. Mitchell, which showed that Mr. Mitchell was determined to put forth his theory of the case despite the evidence against him. I agree that he appeared to be evasive, argumentative, and uncooperative.

[46] The Plaintiff argues that there are other worrying concerns regarding Mr. Mitchell’s evidence. For example, there is no evidence that he told Mr. Dawkins that he did not have the authority to enter into the contract in question. The Plaintiff also stresses that the Defendants benefited from having Code Red “on board” – that is, on standby to deploy in the event there was an actual strike. Code Red’s evidence is that it was on standby for at least an additional 48 hours (October 22-24, 2018) beyond the 72 hours which ran from October 24-27, 2018.

[47] The Plaintiff submits that Mr. Mitchell’s evidence as to whether there was standby services fails the “test of the truth of the story” as there is no “harmony with the preponderance of the probabilities which a practical and informed person would readily recognize as reasonable in that place and in those conditions”. It argues that the meaning of standby services is self-evident. To enjoy the benefit of having Code Red provide the comfort provided by standby services without pay is unconscionable and amounts to bad faith.

[48] The legal requirements to support alleged bad faith conduct are dealt with in C.M. Callow Inc. v. Zollinger, 2020 SCC 45, 452 D.L.R. (4th) 44, wherein Kasirer J. held, at paras. 2-3, that:

In Bhasin, Cromwell J. recognized a general organizing principle of good faith, which means that "parties generally must perform their contractual duties honestly and reasonably and not capriciously or arbitrarily" (para. 63). This organizing principle, he explained, "is not a free-standing rule, but rather a standard that underpins and is manifested in more specific legal doctrines and may be given different weight in different situations" (para. 64). The organizing principle of good faith manifests itself through "existing doctrines" addressing "the types of situations and relationships in which the law requires, in certain respects, honest, candid, forthright or reasonable contractual performance" (para. 66).

In this appeal, the applicable good faith doctrine is the duty of honesty in contractual performance. As Cromwell J. explained in Bhasin, at para. 73, the duty of honesty applies to all contracts as a matter of contractual doctrine, and means "simply that parties must not lie or otherwise knowingly mislead each other about matters directly linked to the performance of the contracts". Callow says Baycrest's failure to exercise its right to terminate in keeping with the mandatory duty of honest performance amounted to a breach of contracts It points to the trial judge's findings that Baycrest withheld the information that the contracts was in danger of termination. Baycrest then continued to represent that the contract was not in danger and knowingly declined to correct the false impression it had created and under which Callow was operating. This dishonesty continued for several months, "in anticipation of the notice period" wrote the trial judge and, claims Callow, resulted in it foregoing the opportunity to bid on other winter contracts and thereby justifies an award of damages (2017 ONSC 7095, at para. 67).

[49] In this case, the burden of proof is on the Plaintiff to prove that the Defendants knowingly misled it about matters directly linked to the performance of the contracts. Although I find that the Plaintiff was “misled” by the Defendants, I cannot find that they “knowingly” did so.

[50] The Plaintiff submits that there can be liability for an employee if he has committed a tort. It is argued that Mr. Mitchell tried to make himself look good for his employer and, in doing so, committed the tort of deceit. Thus, there should be joint liability in this case.

[51] The elements of the tort of deceit were set out by this court in Harland v. Fancsali (1994), 1994 10548 (ON SC), 21 O.R. (3d) 798 (S.C.):

1. The defendant made a false representation of fact;

2. The representation was made with knowledge of its falsity;

3. The representation was made with the intention that it should be acted on by the plaintiff;

4. The plaintiff acted upon the representation; and

5. The plaintiff suffered damage by so doing.

[52] The Plaintiff submits that the Defendants (i) advised that they wished to have Code Red on board; (ii) Code Red accepted the offer; (iii) relying on that representation, Code Red committed personnel to be on standby and disbursed funds in carrying out the standby services; and (iv) an invoice for the service was presented. It is submitted that, not only is this a breach of contract, but such conduct also amounts to the tort of deceit.

[53] The Plaintiff submits that the required independent actionable wrong for its punitive damages claim is the tort of deceit. The Plaintiff stresses that it met all of the Defendants’ demands. They asked for a proposal for 72-hour standby service. It provided more than the 72 hours. They asked that vehicles be removed from the proposal, and this was done. Ultimately, it signed their contract. Between October 15, 2018 to October 27, 2018, Mr. Dawkins was also in constant contact with Mr. Mitchell, seeking information to ensure that he would be in the state of readiness to deploy personnel to do strike coverage if necessary. When Mr. Dawkins advised that there should be another 44 hours as the 72 hours would expire on October 27, 2018, Mr. Mitchell did not ask what 72 hours you are talking about. Mr. Mitchell denied that there was any need for external contractor and that there was no need to be on standby, even though Code Red had in fact been providing standby services since October 22, 2018.

[54] The Defendants argue that there is no evidence of any independent actionable wrong.

[55] The Defendants also submit that Code Red has failed to provide any particulars of tortious conduct. Further, there is no evidence that Mr. Mitchell’s conduct resulted from an interest separate from Sheraton’s. Although, the Plaintiff submits that Mr. Mitchell had an interest separate from Sheraton’s in that he wanted to impress his new employer, I cannot find that there is evidence supporting a finding that he committed an independent actionable wrong.

[56] The Defendants submit that the Plaintiff has not identified the alleged dishonest performance relating to contractual performance. The only obligation that Code Red claims Sheraton had was to pay for the service pursuant to the contract I have heard and carefully considered the Plaintiffs’ submissions on the bad faith of the Defendants. I do not find on the basis of the evidence that there has been dishonesty. Mr. Mitchell’s email communications can be characterized as careless and perhaps bordering on negligent or reckless, but I do not find that “dishonesty” has been proven on a balance of probabilities.

[57] The Defendants submit that damages should be limited to the actual cash disbursed and should not provide for a profit margin. I disagree. The proposal for the cost of 72-hour standby was clear and I have found that the proposal was accepted and the services were performed. Sheraton is liable for payment, but I do not find that the Plaintiff has met its burden of proving that Mr. Mitchell is also personally liable or that punitive damages should be awarded.

[58] To conclude, Sheraton is liable to pay for the standby services performed by the Plaintiff in the amount of $32,950.80, plus pre-judgment and post-judgment interest

Costs

[59] As the Plaintiff was successful in this action, the Plaintiff is awarded its costs of $42,440 on a partial indemnity basis payable by Sheraton.

Pollak J.

Date: November 1, 2021