COURT FILE NO.: CV-19-205 (Brantford)
DATE: 2022/06/07

SUPERIOR COURT OF JUSTICE-ONTARIO

RE: BRIAN TUINHOF, Plaintiff

-and-

MODERN HEATING BRANTFORD LIMITED, Defendant

BEFORE: Gibson J.

COUNSEL:
Christopher Edwards, Counsel for the Plaintiff
Brent Marshall and Katie McGurk, Counsel for the Defendant

HEARD: October 18-22, 2021

CORRECTED DECISION: COUNSEL: Brent Marshall, Counsel for the Defendant was corrected to include Katie McGurk as counsel for the Defendant.

ENDORSEMENT

Overview

[1] The plaintiff Brian Tuinhof sues his former employer Modern Heating Brantford Limited for damages for wrongful dismissal; damages for the loss of Long-Term Disability benefits; moral and bad faith damages; punitive damages; damages for breach of the Human Rights Code, RSO 1990, c. H-19; pre-judgment interest; post-judgment interest; and costs.

[2] The defendant Modern Heating Brantford Limited (“Modern Heating”) is a small company operating in and around Brantford, Ontario. It has eight employees. The most it ever had was nine employees. Modern Heating is primarily engaged in the business of installing, servicing and maintaining heating, ventilation and air conditioning (“HVAC”) units and equipment. The two directors and operating minds of Modern Heating are Tom Kirkby and his wife Wanda Kirkby (“the Kirkbys”).

[3] The plaintiff Brian Tuinhof began working for the defendant in February 2000, and worked for it as an installer of HVAC equipment and service technician until his employment ended in July 2019. At the time his employment ended, Mr. Tuinhof was 53. His total remuneration package, inclusive of bonus entitlements, was approximately $95,000 annually. Mr. Tuinhof participated in a group benefits plan through the defendant which included Long-Term Disability (“LTD”) benefits, but not Short-Term Disability (“STD”) benefits.

[4] On March 13, 2019, Brian Tuinhof’s wife Deanna Tuinhof sent a text message to the Kirkbys indicating that Mr. Tuinhof was facing health challenges. On March 6, 2019, Brian Tuinhof had injured his wrist punching a solid oak cabinet. He was frustrated at difficulties with mould that he had encountered in one of his houses, and its effects upon his wife’s health. He went off work sick on March 14, 2019, and never returned. He did not receive STD Benefits. He declined to use vacation time. Instead, he went on EI benefits.

[5] On April 24, 2019, Deanna Tuinhof met with Tom Kirkby at a Tim Horton’s restaurant to share with him some of the difficulties that her husband was experiencing. She asked Tom Kirkby not to contact the plaintiff.

[6] On July 2, 2019, the Kirkbys met with the plaintiff at the behest of Tom Kirkby. He told them that he was not ready to come back to work. They indicated at that meeting that, in the circumstances, obtaining LTD benefits might not be an easy task.

[7] On July 12, 2019, the plaintiff instructed his physician not to fill out LTD claim forms.

[8] The plaintiff met with Tom and Wanda Kirkby on July 24, 2019. The Kirkbys wanted a return-to-work plan, and some confirmation from a physician that the plaintiff was cleared to do so. The Kirkbys recorded this meeting without Brian Tuinhof’s knowledge. They asked him to return the keys to the Modern Heating work van that he had, and to return the cellular phone Modern Heating had provided. Although they expressed dissatisfaction that he was doing side jobs without authorization, at this meeting the Kirkbys told the plaintiff twice that he was not fired.

[9] Tom Kirkby’s evidence was that on July 24, 2019, it was not his intention to terminate the employment of the plaintiff. He thought there was time to resolve the situation. That changed a few days later when Modern Heating received a lawyer’s demand letter.

[10] No termination letter was ever provided to the plaintiff.

[11] The plaintiff contacted a lawyer shortly thereafter without taking any steps to have a further discussion with the Kirkbys. A lawyer’s demand letter was issued on July 30, 2019. A Statement of Claim was issued September 12, 2019. A Statement of Defence was issued October 7, 2019.

[12] A virtual trial was held by Zoom from October 18-22, 2021.

Witnesses

[13] The plaintiff called three witnesses: the plaintiff Brian Tuinhof himself; his wife Deanna Tuinhof; and Pamela Aucoin, a former employee of Modern Heating.

[14] The defendant called four witnesses: Tom Kirkby; Wanda Kirkby; Mario Baldasarra, a customer for whom the plaintiff installed equipment as a side job; and John Hart, another customer for whom Brian Tuinhof installed HVAC equipment for cash.

Law

[15] When an employer’s conduct evinces an intention to no longer be bound by the employment contract, the employee has the choice of either accepting that conduct or changes made by the employer, or treating the conduct or changes as a repudiation of the contract by the employer and suing for wrongful dismissal: Potter v. New Brunswick Legal Aid, 2015 SCC 10 at para. 30.

[16] The burden rests on the employee to establish that he or she has been constructively dismissed. If the employee is successful, he or she is then entitled to damages in lieu of reasonable notice of termination: Potter, at para. 31.

[17] What the law requires to establish constructive dismissal was succinctly summarized by Miller J.A. in Chapman v. GPM Investment Management, 2017 ONCA 227 at paras. 13-17:

[13] As the trial judge noted, there are two routes that a plaintiff can follow to establish constructive dismissal, as set out in Potter v. New Brunswick Legal Aid Services Commission, 2015 SCC 10, [2015] 1 S.C.R. 500.

[14] The first branch is apt where an employer has, by a single unilateral act, breached an essential term of the contract of employment. The second branch allows for constructive dismissal to be made out where there has been “a series of acts that, taken together, show that the employer no longer intended to be bound by the contract”. On both branches, it is “the employer’s perceived intention no longer to be bound by the contract” that gives rise to the constructive dismissal: Potter, at para. 43.

[15] The first branch – for a single unilateral act – has two steps: (1) the employer’s conduct must be found to constitute a breach of the employment contract, and (2) the conduct “must be found to substantially alter an essential term of the contract”: Potter, at para. 34.

[16] In contrast, the focus of enquiry on the second branch is not on a single act of the employer, but on the “cumulative effect of past acts by the employer” that establish that the employer no longer intends to be bound by the contract:Potter, at para. 33.

[17] The perspective shifts during the analysis. In ascertaining whether an employer’s conduct has amounted to a breach of contract (the first step of the first branch), the test is objective: Potter, at para. 62. Thereafter, on both the second step of the first branch and on the second branch, the perspective shifts to “that of a reasonable person in the same circumstances as the employee …The question is whether, given the totality of the circumstances, a reasonable person in the employee’s situation would have concluded that the employer’s conduct evinced an intention to no longer be bound by [the contract]” (emphasis in original): Potter, at para. 63. In these parts of the analysis, the trial judge must conduct the enquiry from the perspective of the reasonable employee. This perspective excludes, for example, reliance on information that “the employee did not know about or could not be expected to have foreseen.” Potter, at paras.62 and 66. Furthermore, the employee is not required to establish that the employer actually intended to no longer be bound by the contract, but only that a reasonable person in the employee’s situation would have concluded that this was the employer’s intention: Potter, at para. 63.

[18] The test for determining whether an employer was justified in terminating the employee’s employment for cause must be assessed in context, and a balance must be struck between the severity of the employee’s conduct and the sanction imposed: Hucsko v. A.O. Smith Enterprises Limited, 2021 ONCA 728 at para. 31.

[19] In Hucsko, at paras. 33-34, the Court elaborated on the three-part test for determining whether termination for cause was justified, as set out in Dowling v. Ontario (Workplace Safety & Insurance Board) (2004), 2004 ONCA 43692, 246 D.L.R. (4th) 65 (Ont. C.A.), that explained and elaborated on the test in McKinley v. BC Tel, 2001 SCC 38, [2001] 2 S.C.R. 161:

[33] I will examine these errors in the context of the three-part test for determining whether termination for cause was justified, as explained in this court’s decision in Dowling, at paras. 49-50:

[49] Following McKinley, it can be seen that the core question for determination is whether an employee has engaged in misconduct that is incompatible with the fundamental terms of the employment relationship. The rationale for the standard is that the sanction imposed for misconduct is to be proportional – dismissal is warranted when the misconduct is sufficiently serious that it strikes at the heart of the employment relationship. This is a factual inquiry to be determined by a contextual examination of the nature of the misconduct.

[50] Application of the standard consists of:

1. determining the nature and extent of the misconduct;

2. considering the surrounding circumstances; and

3. deciding whether dismissal is warranted (i.e. whether dismissal is a proportional response).

[34] In Dowling, the court went on to explain the requirements of each step. At the first step, the nature and extent of the misconduct must be determined, and the employer is entitled to rely on wrongdoing by the employee that is discovered both before and after the termination. The second step considers the employee within the employment relationship, including the employee’s age, employment history, seniority, role and responsibilities, and for the employer, the type of business, any relevant policies or practices, and the employee’s position in the organization, including the degree of trust reposed in the employee. The third step assesses “whether the misconduct is reconcilable with sustaining the employment relationship”, and “whether the misconduct is sufficiently serious that it would give rise to a breakdown in the employment relationship”: Dowling, at paras. 51-53.

Issues

[20] The issues before the Court on this trial are thus:

1. Was the plaintiff Brian Tuinhof constructively dismissed?

2. If the plaintiff was constructively terminated, was there just cause for the plaintiff’s dismissal?

3. If the plaintiff was wrongfully terminated, what are the damages arising out of his dismissal?

a. To what reasonable notice is the plaintiff entitled?

i. What are the plaintiff’s mitigation earnings?

ii. What is the impact of the plaintiff’s Long-Term Disability benefits, if any, on mitigation?

b. Is the plaintiff entitled to aggravated damages?

c. Is the plaintiff entitled to punitive damages?

4. Was the plaintiff discriminated against on the basis of disability, contrary to the Ontario Human Rights Code?

a. Does the plaintiff have a disability recognized by law?

b. Did the plaintiff suffer any adverse impact?

c. Was the adverse impact connected to the plaintiff’s disability?

d. To what damages, if any, is the plaintiff entitled under the Human Rights Code?

Position of the Plaintiff

[21] The position of the plaintiff is that there was no cause to terminate his employment and the extreme allegations of fraud made against him by the defendant are a clear attempt to manufacture cause in order to avoid accommodating the plaintiff’s disability or paying him the extensive termination benefits to which he should be entitled. In the alternative, the plaintiff submits, if the defendant did not terminate Brian Tuinhof’s employment for alleged cause, the defendant evinced a clear intention to no longer be bound by the employment relationship thereby constructively dismissing the plaintiff. In the circumstances, the plaintiff submits that he is entitled to 24 months’ pay in lieu of notice of termination, being approximately $190,000. He also claims entitlement to damages for the loss of LTD benefits caused by his wrongful dismissal. The plaintiff further claims that the defendant failed to accommodate his disability to the point of undue hardship and evinced discriminatory conduct towards him during his medical leave and at the time of his termination.

Position of the Defendant

[22] The defendant’s position is that it did not terminate Brian Tuinhof. It submits that the plaintiff represented to Modern Heating that he was not able to continue with his duties due to medical reasons, and has never provided Modern Heating with any evidence that he is now capable of returning to work on either a full or part-time basis. The defendant contends that the plaintiff voluntarily left his employment with Modern Heating, and chose not to return. It says that the plaintiff never disclosed what, if any, accommodation he might require in order to return to work. It asserts that the plaintiff denied Modern Heating the opportunity to accommodate his disability by not disclosing that disability to Modern Heating or by making a specific or general request for accommodation. In the alternative, Modern Heating pleads that if it is determined that it terminated the plaintiff’s employment, such termination was for cause. It submits that Tuinhof, as an employee, knowingly and wilfully breached his general duty of loyalty to Modern Heating. Specifically, it says that the plaintiff: competed for business with Modern Heating; that he solicited Modern Heating’s customers and clients while an active employee, and while on leave due to medical reasons; that he used work time to further his own interests; that he misappropriated the property of Modern Heating for his own purposes; and that he has failed to account for profits realized by him while an employee. Modern Heating asks that the action be dismissed with costs.

Analysis

[23] The evidence and submissions of the parties in this case depict two very different tales of competing reality. The plaintiff says that he was a loyal employee who exercised management responsibilities and played a key role in Modern Heating’s business. He says that his performance of side jobs was open and notorious, and that Tom Kirkby acquiesced in his doing so.

[24] The Kirkbys insist that the plaintiff was primarily a service technician, and that side jobs were permitted only for family or close friends, if Tom Kirkby gave prior approval and the HVAC equipment was purchased from him. The defendant insists, however, that the plaintiff was not accorded the broad licence to do side jobs that he claims, and that Brian Tuinhof’s description of the permitted scope of his activity makes no sense on a commercial basis. It constituted competition with Modern Heating, and potentially exposed it to liability because Tuinhof affixed new gas installation tags that specified Modern Heating as the contractor, for jobs that were unknown to it and from which it made no money.

[25] For the reasons explained below, I accept the evidence of the defendants in this regard. I do not accept the evidence of the plaintiff.

Issue # 1: Was Brian Tuinhof constructively dismissed?

[26] The test in Potter puts the initial burden on the employee. The employee must meet one of the two tests. The first is where any employer has, by a single unilateral act, breached an essential term of the contract of employment. This has two steps. The employer’s conduct must be found, assessed on an objective basis, to constitute a breach of the employment contract; and, assessed from the perspective of a reasonable person in the same circumstances as the employee, the conduct must be found to substantially alter an essential term of the contract.

[27] In this case, the plaintiff’s claim rests on the assertion that taking away the service vehicle and the phone on July 24, 2019 breached an essential term of the contract of employment. The evidence does not support this conclusion. Assessed on an objective basis, this did not constitute a breach of the employment contract. Modern Heating employees did not have a right to a company cellphone or use of a service truck for private purposes as a condition of employment. The vehicle was a service vehicle, whose purpose was to transport tools and equipment to jobsites to allow employees to complete their assigned tasks, and for employees to be available for emergency on call service when required. Its essential purpose was to benefit Modern Heating, not the individual employees. There was no general entitlement to use it for personal use. It was a service vehicle provided to complete work tasks, not a perk of the job. The same obtained for the cellphone. They were not part of Brian Tuinhof’s compensation package. Brian Tuinhof never reported the use of the vehicle as a benefit of employment on his income tax return, and such a benefit was never attributed to him by Modern Heating. Tom Kirkby testified, and I accept, that it was necessary to have the vehicle returned in July 2019 because this was a busy season for Modern Heating’s business, as the temperature had become hot in July and customers wanted air conditioners installed or serviced, and that he himself needed the use of the vehicle to pick up the slack created by Brian Tuinhof’s absence.

[28] A reasonable person in this circumstance would not have felt that an essential term of the employment contract had been altered.

[29] The second branch allows for constructive dismissal to be made out where there has been a series of acts that, taken together, show that the employer no longer intended to be bound by the contract. The focus of enquiry is not on a single act of the employer, but, assessed from the perspective of a reasonable employee, on the cumulative effect of past acts by the employer that establish that the employer no longer intended to be bound by the contract. This requires that a reasonable person in the employee’s situation would have concluded that this was the employer’s intention.

[30] As stated by Miller J.A. at para. 22 in Chapman,

“it must be borne in mind that both the first and second branches of Potter are in service of the same ultimate enquiry: the determination of whether the employer has, by its conduct, evinced an intention not to be bound by the contract: Potter, at para. 63. The question of whether there has been a substantial alteration of an essential term of the contract is not an end in itself, but a step towards answering this ultimate question. The trial judge had this ultimate question in mind, and did not conflate the two branches of the Potter test.

[31] I find that the employer did not evince an intention not to be bound by the contract, and that a person viewing the matter from the perspective of a reasonable employee would not have concluded otherwise. The removal of the vehicle and the cellphone was but one factor to consider. The plaintiff was advised twice by the defendant that he was not fired. Modern Heating continued to pay the premiums for his benefits. On July 25, 2019, subsequent to the important meeting on July 24, 2019 upon which he grounds his claim, the plaintiff advised his physician Dr. Prowse that he had not been fired. The plaintiff’s own actions following the July 24 meeting suggest that he did not consider he had been terminated, up until the issuance of a lawyer’s demand letter.

[32] The evidence indicates that, in withdrawing access to the service vehicle and to the cellphone, Modern Heating did not breach any essential term of the employment contract. These actions did not substantially alter the employment agreement.

[33] I find that the plaintiff has not satisfied the onus upon him to demonstrate that he was constructively dismissed. He voluntarily left employment with the company in July 2019.

[34] I find that, in the totality of circumstances, the plaintiff was never actually or constructively dismissed be the defendant.

Issue # 2: If Brian Tuinhof was actually constructively dismissed, was there just cause for his dismissal?

[35] As I have indicated, I have not found that the plaintiff was constructively dismissed. However, even if I am wrong in this assessment, I am satisfied that Modern Heating would have had just cause for dismissal.

[36] The first step from the Dowling analysis, elaborated in Hucsko, requires that the nature and extent of the misconduct be determined. The employer is entitled to rely on wrongdoing by the employee that is discovered both before and after the termination: Hucsko, at para. 34.

[37] At the second step of the test, the court considers the circumstances of both the employee and the employer.

[38] Having identified the nature and extent of the misconduct by the employee, and taken into account the surrounding circumstances, the third step of the test requires the court to determine whether the misconduct was sufficiently serious that it resulted in a breakdown of the employment relationship, and whether dismissal was a proportionate step by the employer.

[39] This requires a factual analysis.

[40] I find that Brian Tuinhof breached his employee’s duty of loyalty. He frequently solicited business from his employer’s customers to his own benefit. His text messages to Mario Baldasarra make this plain. Mr. Baldasarra asked whether the quoted price was a Brian Tuinhof price, or a Modern Heating price. The price agreed upon was a lower price, paid in cash to the plaintiff, from which Modern Heating derived no benefit. His explanation for this makes no commercial sense.

[41] The plaintiff’s actions exposed Modern Heating to significant potential liability. He affixed new gas installation tags that indicated Modern Heating as the contractor. These jobs were unknown to the defendant, but the defendant could have been liable for any damages arising from faulty installation. This demonstrated a capricious disregard for Modern Heating’s commercial interests.

[42] The plaintiff has not established that the defendant condoned his conduct. I find that while he had a limited authorization to do side jobs, he did not have carte blanche in the fashion he asserts. I accept the evidence of Tom Kirkby in this regard. The plaintiff’s submission defies commercial reason. The evidence indicates that the plaintiff completed multiple installations and service calls, over an extended period, without the knowledge or authorization of Modern Heating.

[43] Contrary to his submissions, the plaintiff has not established that the defendant “manufactured” cause against him after the fact.

[44] The plaintiff’s evidence suffers from a significant deficit of credibility in this regard. He claimed Employment Insurance benefits while working. He charged HST for the side jobs he did, but did not remit it. He did not report the income on his income tax return, and claimed medical expenses. I do not accept his explanation that he left it all to his accountant. He is responsible in law for the income tax return that he signs and submits. It is his return. He signed and adopted it. He is not magically absolved of responsibility for dishonesty or misrepresentation because someone else prepares the return on the basis of information that he provides. That is a convenient, facile and unviable fiction.

[45] The plaintiff’s evidence suffered from a consistent credibility problem. His answers were convenient, and frequently appeared to depend upon what he perceived to be beneficial at that moment. His memory appeared to be much sharper on issues explored in examination-in-chief than on those explored in cross-examination. An example would be his answers concerning his income properties, in which he frequently said he could not recall details.

[46] I find that the misconduct was sufficiently serious that it resulted in a breakdown of the employment relationship, and dismissal would have been a proportionate step by the employer.

Issue # 3: If the plaintiff was wrongfully terminated, what are the damages arising from his dismissal?

[47] Having found that the plaintiff was not wrongfully terminated, there are no grounds to award damages.

[48] In particular, punitive damages are restricted to advertent wrongful acts that are so malicious and outrageous that they are deserving of punishment on their own: Keays v. Honda Canada Inc., 2008 SCC 39. The facts of this case demonstrate no such conduct. Courts should only resort to punitive damages in exceptional cases and the employer’s conduct here was not sufficiently egregious or outrageous to warrant such damages. Punitive or exemplary damages are not appropriate in this case.

Issue # 4: Did Modern Heating discriminate against Brian Tuinhof on the basis of disability, contrary to the Human Rights Code?

[49] I conclude that Modern Heating never discriminated against Brian Tuinhof on the basis of a disability. The comments of Tom and Wanda Kirkby in the video which captured what they discussed while observing Brian Tuinhof using the tools in the company workshop for his own benefit were unfortunate comments made out of frustration, but never manifested in any actual discrimination against Brian Tuinhof. The attitudes they expressed concerning mental illness such as depression captured on the video were regrettable, and do not accord with a contemporary and appropriate understanding of the effects of depression as a mental illness, but they were made in the context of a private discussion amongst family members, and were not coupled with disciplinary actions against the plaintiff. There has been no evidence presented of discriminatory actions by the defendant.

[50] Moreover, Brian Tuinhof failed to participate in the collaborative process of accommodation. He had an obligation to provide some medical documentation about his problems and any necessary accommodations.

[51] The plaintiff has not demonstrated any failure of a duty to accommodate. He has not demonstrated any adverse impact connected to a disability.

[52] No damages under the Ontario Human Rights Code are warranted in this instance.

[53] In summary, the plaintiff has failed to satisfy the onus upon him to demonstrate that he was constructively dismissed, that he was wrongfully terminated, or that he should be entitled to damages.

Order

[54] The plaintiff’s action is dismissed.

Costs

[55] The parties are encouraged to agree upon appropriate costs. If the parties are not able to agree on costs, they may make brief written submissions to me (maximum three pages double-spaced, plus a bill of costs) by email to my judicial assistant, Mona Goodwin at mona.goodwin@ontario.ca and to Kitchener.SCJJA@ontario.ca. The defendant may have 14 days from the release of this decision to provide its submissions, with a copy to the plaintiff; the plaintiff a further 14 days to respond; and the defendant a further 7 days for a reply, if any. If no submissions are received within this timeframe, the parties will be deemed to have settled the issue of costs as between themselves. If I have not received any response or reply submissions within the specified timeframes after the defendant’s initial submissions, I will consider that the parties do not wish to make any further submissions, and will decide on the basis of the material that I have received.

M. R. Gibson, J.

Date: June 7, 2022