40 Day Trial Nets $141,000 ” Win”.

In Merrifield v Canada ( Attorney General ) 2017 ONSC 1333, Justice Vallee heard a case involving  serious allegations of harassment against a RCMP officer by his superiors over a number of years.

The trial took 40 days, and stretched out from November 2014 to April 2016.  The record shows five lawyers for the parties.

In a 896 paragraph decision  the plaintiff won and was awarded two heads of damages:

  1. The Plaintiff’s rise in rank had been delayed a for 18 months , resulting in a career wage loss of $41,000.
  2. For the tort of intentional infliction of mental suffering, the Court had this to say :

What amount should be awarded to Mr. Merrifield for general damages?
877. Amounts awarded for damages for intentional infliction of mental suffering and harassment have increased significantly since the 1990s.
878. In Clark v.Canada, [1994] 3 F.C. 323, 3 C.C.E.L. (2d) 172, a female member of the RCMP was harassed by her male co-workers. She was told to be a “real woman” and go home and have children. Her co-workers watched pornographic movies while she was in the office. Plastic breasts were left on her desk. When her body armour was delivered, it was set up with a mocking note attached to it. These are a few examples of what the plaintiff endured. When she complained to her supervisors, they were dismissive. These events caused her to have a documented mental health crisis. She resigned her position.
879. The court reviewed awards for intentional infliction of nervous shock prior to 1994, considered a “reasonable measure of consolation” for her particular mental condition and awarded the plaintiff $5,000. The defendants’ state that based on this decision, if Mr. Merrifield is entitled to damages, the amount should be nominal.
880 .The plaintiff relies on four cases decided between 1997 and 2014. They are Wallace v. United Grain Growers Ltd., [1997] 3 S.C.R.701, Tipple v. Canada (Attorney General), 2012 FCA 158, 431 N.R. 257, 158, Joseph v. Tl’azt’en First Nation, 2013 F.C. 767, 9 C.C.E.L. (4th) 173 and Boucher v. Wal-Mart Canada Corp. The defendants state that these cases are not applicable because the plaintiffs were either terminated or constructively dismissed.
881. I disagree with the defendants’ position. In all of these cases, the court considered the events leading up to the termination or constructive dismissal. The defendants’ actions caused the plaintiffs to suffer from mental health conditions. Damages were awarded to the plaintiffs for mental suffering. I find that these cases are relevant and helpful on this issue.
882. In Wallace, the Supreme Court of Canada determined that the trial judge had discretion to extend the notice period with respect to the termination. The possibility of recovery for mental health damages remained. It noted that a tort for breach of good faith and fair dealing regarding a dismissal was not yet recognized.
883. In Tipple, the employer alleged that the plaintiff’s actions were a form of misconduct. The matter attracted a considerable amount of media attention. The court found that the allegations were unfounded. In the interval, the plaintiff had suffered a significant loss of reputation. He was awarded $250,000 for the loss of reputation and $125,000 for the psychological injury that he sustained as a result of the manner of his termination.
884. In Joseph, an employer made vile and serious allegations of fraud upon the employee’s termination. This resulted in significant damage to the employee’s reputation. The employee had considerable difficulty in finding other employment. Prospective employers stated that the plaintiff had to be vindicated before they would consider hiring him. The court awarded $85,000 for damage to the employee’s physical health, well-being, integrity, dignity and personal and professional reputation.
885. In Boucher, the plaintiff was a cheerful and productive employee. When the personal defendant became her supervisor, he belittled, humiliated and demeaned the plaintiff in front of others continuously and relentlessly for approximately six months. She complained of her supervisors actions to management who determined that her complaints were unfounded and told her that she would be held responsible for making them. The plaintiff became broken and defeated. She suffered from a number illnesses including depression. A jury awarded the plaintiff $100,000 for intentional infliction of mental suffering. The award was upheld on appeal.
886. Mr. Merrifield suffered from significant depression and post-traumatic stress disorder as a result of the actions taken by the RCMP. He was unable to work for various periods of time. At one point, he disengaged from his family and spent his days lying on a sofa. He did not bathe and developed bed sores. His depression during these periods deprived him of meaningful interaction with his wife and young children. It deprived him of successful performance in a job that he loved and for which he was acknowledged to be a national expert. It also deprived him of the gratification of positive interaction and collaboration with his colleagues.
887. Not only did Mr. Merrifield suffer from significant mental health issues as a result of the actions taken by the RCMP, those actions also stained his reputation. A number of people knew that he had been removed from national security work. They assumed that he had done something wrong. Even Insp. Van Doren, who was not Mr. Merrifield’s supervisor, knew that he had been removed from national security work. As a result of this, he considered Mr. Merrifield to be unsuitable to work at the SOC during a national security emergency.
888. Supt. Proulx accused Mr. Merrifield of using his Amex card for personal reasons, in other words stealing money from the RCMP. Sgt. Dickinson interviewed a number of people during the Part IV investigation. All of them knew the serious allegations against Mr. Merrifield which were tantamount to criminal conduct. The allegations were insidious. For example, Supt. Jagoe still believes that the allegations were substantiated. Just as the news of Mr. Merrifield’s removal from national security work spread among the RCMP management and other members, so too would the allegations of disgraceful conduct. Sgt. Dickinson stated that the members that he interviewed would not have known of the outcome of the Part IV investigation or that the allegations were unfounded.
889 Taking all of this into account, I award Mr. Merrifield general damages against the defendants for harassment and intentional infliction of mental suffering in the amount of $100,000.


One cannot begin to imagine the legal fees involved in this case. I do not know what has or will happen at the costs stage or  if the AG was smart enough to put in a Rule 49 offer of more than $141,000 well before the trial.

If they did, ( and as a taxpayer I sure hope they did ) the cost award in their favour would easily wipe out the $141,000 award and the plaintiff would owe a considerable amount to the Crown for costs.

If the Plaintiff put in a Rule 49 offer and beat it, well then the Plaintiff’s costs will dwarf the award.

I have not seen the pleadings but I cannot imagine that a plaintiff would launch an action of this enormity and only expect to receive $141,000.

So here we have it. A legal process that costs hundreds of thousands of dollars that in the end results in the  transfer of  $141,000 from one party to another, maybe.

How is this process proportional as required by Rule 1.04 of the Rules of Civil Procedure ?


General Principle

1.04 (1) These rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.  R.R.O. 1990, Reg. 194, r. 1.04 (1).


(1.1) In applying these rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.  O. Reg. 438/08, s. 2.




Another Woeful Case About Costs :

Regular readers of this blog will know that I often comment on costs awards in wrongful dismissal cases .

Have I got a doozy for you.

At the trial decision of Doyle v Zochem ( 2016 CarswellOnt 3188), the plaintiff was  awarded 10 months salary, human rights damages of $25,000 and moral damages of $60,000 for a total before costs of about $140,000.

The defendant made a number of Rule 49 offers, the last one being for $133,196.23.

Thus the defendant missed the mark by $7,653.

In a cost award found at 2017 CarswellOnt 1335,  Judge Trimble awarded the plaintiff costs of approximately $412,000.

The Defendant appealed but was only looking for a reduction in the moral damages award from $60,000 to a more modest $20,000.

Why spend more money on this appeal to save a lousy $40,000?

ANSWER: If the Court of Appeal had reduced the moral damages by at least $7654, the Defendants Rule 49 offer would have been operative and not only would they not have to pay the plaintiff anything for the actual trial ( 28 days ) but they would have received an offset for their trial costs, which would have wiped out the judgement and the Plaintiff would have owed the defendant a fortune .

Alas, the Court of Appeal denied the appeal and ordered further  costs of the appeal of $40,000.

According to the public record this little fiasco has cost the Defendant the following sums:

Judgement   :                                    $140,000

Costs to the Plaintiff for trial :      $412,000

Costs to the Plaintiff for appeal:  $40,000

Their  own costs of trial :               $682,415

Their costs of appeal ( my est.)      $40,000

TOTAL :                                              $ 1,314,415.

You gotta love our legal system.

CLC Adjudicator Denies Both Reinstatement & Costs to Winning Employee:

In Weed v Royal Bank of Canada (2017 CarswellNat 343) Adjudicator Michelle Somers heard an unjust dismissal case for 14 days, with 9 witnesses and ” voluminous ” documentary evidence.

Having found that Mr. Weed was unjustly dismissed , the Adjudicator declined to order reinstatement for the following reasons :

196. It is well-established that s. 242 of the Code gives the Adjudicator broad powers of compensation, including reinstatement “Where an employee has been dismissed unjustly, there is a presumption in favour of reinstatement unless there is clear evidence to the contrary”: Pecoskie and Atomic Energy of Canada Ltd., 2015 CarswellNat 5573. The test whether there is a relationship of trust between the employer and employee is an objective one.
197. Counsel for RBC submitted that reinstatement would not be appropriate, while Counsel for Weed went no further than to acknowledge that I have the right to consider it In an October, 2014, email, Weed told a prospective employer that he was going through the Labour Board so he could have his position back with RBC but that he was sure that was a bad idea.
198. Weed believes that his role as a financial planner is to serve the best interests of his clients. He believes, apparently sincerely, that his employer’s emphasis on sales conflicts with those interests. RBC had shifted its business emphasis during Weed’s employment towards a drive to increase sales of its products, and I conclude that Weed either had difficulty or refused to accept this shift Prior to the onboarding of Leblanc as his manager, he had a clean record. Indeed, he was a very good performer. There may or may not have been insufficient training in the new business model.
199. These factors are not sufficient to excuse some of the decisions that Weed made during his employment As the Adjudicator said in Farrell v Royal Bank of Canada [1998] CLAD. No. 793, “My conclusion that the Bank did not meet the just cause standard in dismissing Farrell should not be understood as a vindication of her work performance in that regard.” [para. 144]
200. Although he did say to Leblanc and in his Decision-Making Exercise that he would change his conduct to be more in line with his employer’s standards, Weed did not acknowledge at the hearing that his conduct at the very least contravened his employer’s compliance standards, nor that he was in any way responsible for the breakdown in his relationship with his employer. That makes his prospects for a happy future with RBC dim. My lack of confidence is exacerbated by his avowal at the hearing that as between the bank’s standards and his own estimation of his client’s needs, he would disregard standards set by his employer.
201. I agree with RBC that the relationship between it and Weed has been irreparably damaged, and that reinstatement is not a feasible remedy.

The Adjudicator instead awarded him compensation in the sum of $230,000 which covered the period of time from his dismissal to the date of the award, a period of 35 months less mitigation income plus  a 15% reduction for what the Adjudicator thought was poor mitigation efforts.

In awarding costs the Adjudicator properly stated that :

It has now been established that an Adjudicator appointed under the Code has the jurisdiction to award costs. The leading case is Banca Nazionale del Lavoro of Canada Ltd. V Lee-Shanok [1988] F.C.J. 594, 1988 CarswellNat 254 (FCA). Stone J.A. determined the scope of the Adjudicator’s jurisdiction under s. 61.5(9)(c) of the Code [now s. 242(4)(c)]:
“I have no difficulty in reading it, with its broad reference to granting relief that is “equitable to require the employer to do in order to remedy or counteract any consequence of the dismissal”, as including the power to award costs. The difficulty I have is in viewing an award of compensation, gained at some considerable expense to a complainant in terms of legal costs, as having the effect of making him whole. Legal costs incurred would effectively reduce compensation for lost remuneration, while their allowance would appear to remedy or, at least, to counteract a consequence of the dismissal.” [para. 25]


The Adjudicator then went to refuse to award costs to the winning Mr Weeds with the following rationale.

212.  Counsel for Weed suggested that half of solicitor-client costs would be appropriate. However, I am going to adopt the reasoning in Pecoskie, supra. In that case, the Complainant was Executive Assistant to the Vice-President of Finance. She sent 35 emails that were “confidential and privileged” to her husband, who was a Project Leader in the same company. It was alleged she had also sent him emails that insulted and derided other managers and colleagues. Although her performance had previously been assessed in glowing terms, the company bypassed progressive discipline and dismissed her on the basis she had committed “a serious breach of trust, confidentiality and respectful workplace practices.” Adjudicator Clarke examined the emails in detail. They were largely related to issues that assisted her husband in his role at the company. A few said distasteful things about her manager and alleged that a colleague was not truthful. No one saw them but her husband. The Adjudicator determined that although she had violated the rules of the workplace, her actions were not sufficiently serious to warrant summary dismissal. Nevertheless, the Adjudicator made no costs award because the complainant could not be considered blameless.
213. Counsel for RBC submitted that no costs should be awarded given Weed’s conduct at the hearing. While I would not go so far as to say he made allegations that were proven to be false, I have already determined that that Weed has much to answer for in this matter, and I therefore decline to award costs.

This is a particularly troubling comment and result. The adjudicator seems to apply a exceeding high standard for a winning party to get costs, in that they apparently must be “blameless”, a standard which most of us would fail.

Although I am not usually the one to quote the New Testament, I am reminded of what Jesus said in John 8,  v 7. ESV:

“Let him who is without sin among you be the first to throw a stone at her.”

Let us do some math. The Adjudicator awarded $230,000.

Out of that amount he will have to pay his lawyer for a 14 day hearing and all the preparation. His lawyer was Richard Gilborn QC. Say a senior member of the bar in Calgary is charging his client $500/ hour or $4000 a day for a 8 hour day. Further assume that for every day of hearing there is about 2 days of preparation.

That makes for a bill of    14 X 3 = 42 days X $4000 / day = $168,000

The award was $230,000. After paying his lawyer he is left with $62,000 . Assume a conservative tax rate of 33%, he is left with $40,920.

Is that a  just result when one actually  wins a case ?



Latest IBM Notice Case Sets Clear Rules on Calculating Damages:

In Patterson v IBM ( 2017 CarswellOnt 2625) Justice Dunphy determined the appropriate notice period for a 67 year old Band 6 IT Specialist with 22 years service making $62,388 per year. He awarded a notice period of 18 months.

Dunphy J. made some interesting and helpful comments in the judgement on a number of topics:

  1. The usefulness of summary judgements in notice cases.

4. Wrongful dismissal cases lend themselves particularly well to resolution through summary judgment proceedings. Cause is seldom at issue and the criteria to assess damages typically involve few disputed facts. The difference between the low and high end of likely damages is seldom as great as the costs of finding the answer following a full trial with all the trimmings. In my view, the practice of resolving wrongful dismissal damages cases in a co-operatively managed summary judgment proceeding is to be strongly encouraged: Arnone v. Best Theratronics Ltd., 2015 ONCA 63 (CanLII), Fraser v. Canerector Inc., 2015 ONSC 2138 (CanLII).


2. The Lesser Importance of Character of Employment 

20. I am also mindful of the fact that “character of employment” is a criterion that is often of limited value in the modern context. This is a point that our Court of Appeal has recently emphasized in cases such as Di Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA 469 (CanLII). It bears in my view only some weight in a case such as this. It may be that this particular criterion is fast becoming a vestige of a by-gone era. It is certainly difficult to defend on a principled basis. However the near universal application of Bardal over the last fifty-six years is such that I must leave the consideration of that issue to a higher court on another day. It is not of any great weight in this case and I shall leave it at that.

3. Use of  Prior Cases with the Same Defendant 

There has been a number  of wrongful dismissal cases involving IBM in the last few years on the issue of notice. In this case the Judge seemed to rely heavily on prior IBM cases as shown in this paragraph.

27. In Quinn v. IBM Canada Ltd. (unreported, CV-16-552858 released November 28, 2016), Myers J. awarded a 55 year old “Band 7” IBM employee 20 months of notice. Mr. Quinn had worked his entire working life at IBM with more than 35 years of service. In Waterman v. IBM Canada Ltd., 2010 BCSC 376 (CanLII); (affirmed 2013 SCC 70 (CanLII)), another “Band 7” IBM employee terminated at age 65 with 40 years of service was also awarded 20 months of notice. In Liboiron v. IBM Canada Ltd., 2015 BCSC 1523 (CanLII) a 57 year old Band 6 IBM employee with 32 years’ service was awarded 20 months. In Lee v. IBM Canada Limited, (unreported, CV-15-532014 released February 4, 2016) a 62 year old part-time employee with 40 years of service was awarded a notice period of 21 months. The “Band” of this employee does not appear in the decision but her full-time equivalent income would suggest that it was at a similar level (i.e. Band 6 or Band 7).
28. These four cases were relied upon by both parties with differing emphasis. They are useful comparators here not simply because they all involve the same employer. However, the IBM internal employee classification system in “bands” referred to by three of them provides at least a superficial basis of comparison of the character of the employment within the same organization. Two were one band higher while one was also in Band 6 (the fourth likely being in that same range). Importantly, the employees in question were all quite long-serving, in the upper age range and each was described as having quite challenging job prospects going forward. Three of these cases awarded 20 months of notice while one awarded 21 months of notice. These four employees had considerably more years of service to their credit than Mr. Patterson.
29. Every case turns on its facts and no two cases are exactly alike. That being said, these four cases are the most similar to the facts before me of any of the cases presented to me by the parties and recommend themselves to me for that reason.

This is similar to what happened in the Canac line of cases in which the Court relied primarily on other Canac cases in determining reasonable notice.

4. Determining how  the issue of future mitigation can be recognized in the calculation of damages given the period of reasonable notice has not yet expired. 

40.  It is only relatively recently we have managed to get to the point of being able to render a decision on wrongful dismissal damages while the period of reasonable notice is still running. The practice in such cases is divided. Some judges have opted to apply the “trust and accounting” approach and require the plaintiff to account to the defendant for future income if any earned during the notice period: Drysdale v. Panasonic Canada Inc., 2015 ONSC 6878 (CanLII). Others have reasoned that future employment income damages are like any other contingent future damages and can be calculated with appropriate discounts for contingencies if necessary: Peticca v Oracle Canada, 2015 ONSC 2584 (CanLII).
41. I don’t think there is any hard and fast rule requiring me to adopt either approach and I may look at both for guidance on how best to achieve justice between the parties on the facts of this case.
42. Of the two approaches, the discounted approach appears to me to be the most consistent with general principles of calculating damages. It is also an approach that commends itself on other grounds. A “once and for all” calculation removes the incentive, even if only subconsciously, for the plaintiff to be lukewarm in his search for a new position if all income earned would have to be remitted immediately to a former employer. Society and the parties are all unquestionably better off if the plaintiff is able to resume productive, taxpaying work as soon as possible. A discounted approach also avoids the possibility of future legal entanglements between the parties.
43. In the present case, the notice period found by me has seven months to run. I have found it preferable in this case to fold into my consideration of the reasonable notice period the additional consideration of a minor discount for potential future earnings over the seven months or so I have found remain to be run in the notice period. Given the plaintiff’s poor prospects, the amount would at all events be quite minor relative to the total award and it seemed to me to be preferable to arrive at a global damages award rather than attempt to parse it artificially. I have thus applied the discounted approach but chosen not to break it out in a separate calculation here.

I especially like his policy analysis in paragraph 42. It recognizes that both the general law of mitigation and the trust approach used in some cases creates a situation whereby if an employee were to find a new but somewhat lesser paying job early on during the notice period, he or she is effectively working for free for the balance of the notice period as the former employer gets full credit for every dollar the employee earns in his new job. I don’t know about you, but as much as I like my job, I am sure not doing it for free.