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WRONGFUL DISMISSAL - Constructive dismissal - Unfair dealings

Monday, July 12, 2021 @ 9:35 AM  

Lexis Advance® Quicklaw®
Appeal by Alberta Computers and Pope, its principal, from trial judgment allowing the respondent’s counterclaim for constructive dismissal and defamation. The appellants induced Thibert to leave secure employment to join Alberta Computers. The relationship was unsuccessful, resulting in termination of Thibert’s employment after six and a half months. Pope recruited Thibert to sell to its customers what was characterized as a fully operational Microsoft-centred IT managed services product. The trial judge found there was no IT product matching the promises available for Thibert to sell, and the efforts to meet the agreements were incomplete patchwork. Instead of a written employment agreement, Pope presented Thibert with a non-disclosure agreement that Thibert refused to sign. There was nothing in that document about a job description or benefits. The trial judge concluded the non-disclosure agreement did not form part of the employment contract. The trial judge found that the existence of a unique and fully operational managed services product for Thibert to sell and the provision of a written compensation structure were both essential terms of Thibert’s employment agreement and that those terms were breached. The defamation claim was grounded in a letter sent by Alberta Computers after the dismissal to numerous businesses in the Grande Prairie business community claiming Thibert was legally obligated to cease all services and solicitation with those businesses. Alberta Computers claimed Thibert resigned without proper notice and alleged he had, after leaving the job, misused confidential information and data acquired during his brief period of employment. Thibert asserted he was constructively dismissed and subsequently defamed by the appellants. Alberta Computers sued Thibert and his new company, Snap Technologies, alleging breach of fiduciary duty, breach of confidentiality, and inducement of breach of contract. The appellants challenged the trial judge’s finding of constructive dismissal and the damage award of $43,520 in lieu of notice. The appellants also appealed the finding that they defamed and the award of $60,000 in defamation damages.

HELD: Appeal dismissed. There was no basis for setting aside the constructive dismissal finding based on the appellants’ breach of the essential terms of Thibert’s employment contract and the fact that Alberta Computers created an untenable position for Thibert due to a toxic employment relationship. The trial judge made no error in assessing the reasonable notice period by considering not only Thibert’s length of actual employment with Alberta Computers, but also that he was induced to leave his previous secure and well-paying position. The trial judge’s assessment of damages was entitled to deference. There was no basis to interfere with the damages awarded for constructive dismissal. The trial judge’s finding that the appellants’ post dismissal letter was defamatory was reasonable and no basis for appellate intervention on this finding was demonstrated. The letter did not merely characterize Thibert as an unsatisfactory or ineffective employee. He was accused of illegal and disloyal conduct. While there was no evidence that Alberta Computers provided those letters directly to the recipients, the evidence relied on by the trial judge was all admissible non-hearsay evidence that the letter was somehow received by various non-customers of Alberta Computers. The trial judge made no error in finding that the defences of justification or qualified privilege did not provide an answer to the proven defamation and she did not improperly rely on hearsay evidence in these findings. The trial judge did not double count damages by referring to the impact of the defamation on the ability of Thibert to start a business. It was not easy to calculate the value of one’s good name, and trial judges were usually forced to make a reasonable estimate. There was no reason to dispute the quantum assessment.

Alberta Inc. v. Thibert, [2021] A.J. No. 786, Alberta Court of Appeal, J. Watson, D. Pentelechuk and K.P. Feehan JJ.A., June 9, 2021. Digest No. TLD-July122021001