One of our lawyers, Christopher Rootham, took home a win for the respondent at the Ontario Court of Appeal earlier this year in the case of Arnone v. Best Theratronics Ltd.
Best Theratronics Ltd. (“Best”) had terminated the employment of the respondent, Matthew Arnone (“Arnone”), without cause on November 26, 2012 after 31 years of employment with Best and its predecessor. Best paid Arnone a total of 14.4 weeks, representing his statutory minimums under the Canada Labour Code, after which Arnone commenced a wrongful dismissal action seeking 24 months’ pay in lieu of notice less certain amounts, among other things, and moved for summary judgment. Arnone was successful on his motion and Best appealed; Arnone cross-appealed. This is yet another case that relies on the Supreme Court of Canada decision in Hryniak v. Mauldin, the leading case on summary judgment motions.
On appeal, the Court dealt with a total of six issues. The first issue was whether the motion judge erred in concluding that no genuine issue requiring a trial existed regarding the character of Arnone’s duties and responsibilities. Best submitted that a trial was required because of the conflicting evidence. However, the Court of Appeal did not agree with this submission for the following reasons:
- Arnone conceded, for the purpose of the summary judgment motion, that he was a supervisor, not a manager (as alleged by Best);
- The documentary record was both extensive and reliable, and several affiants had been cross-examined; and
- The character of one’s employment, which is one of several factors a judge must consider in determining the appropriate reasonable notice period, is a factor of declining importance.
The Court then moved on to the next issue – whether the motion judge properly calculated Arnone’s reasonable notice period. This issue arose because, according to Best, the motion judge calculated the period of reasonable notice so as to “bridge” Arnone to the date of his eligibility for an unreduced pension at his early retirement date. Arnone conceded this error, and rightly so, as the Bardal analysis remains the approach courts must apply to determine what constitutes reasonable notice of termination. This analysis looks to several pre-determined factors and applies them to the specific factual scenario in order to determine an acceptable range for the reasonable notice period. These factors do not, and should not, include a consideration of the timing by which an employee becomes eligible for a full pension.
Nevertheless, the motion judge had made an alternative finding that otherwise, Arnone’s reasonable notice period would amount to 22 months. Arnone submitted that this was an appropriate period given the case law, whereas Best sought to pay no more than the statutory minimums they had already paid. Only Arnone presented with supporting case law, which ultimately resulted in the Court of Appeal’s approval of the 22-month notice period.
Once the length of the period was determined, the next issue was whether Best was entitled to deduct the income earned by Arnone from his new employment from the damage award he would be receiving from Best. As both parties agreed that a deduction should have been made by the motion judge, this issue was resolved quickly.
The fourth issue was whether the motion judge erred in awarding Arnone a retirement allowance. A retirement allowance equal to one week per year of service to a maximum of 30 weeks was customarily received by employees who retired from Best. Eligibility for the Best retirement allowance was a separate contractual entitlement that formed part of Arnone’s contract of employment with Best; it was not tied to Arnone’s entitlement to a pension. This is where the motion judge erred. Instead, the Court of Appeal read into that contractual term an implied term that if an employee is terminated without cause, he would be entitled to payment of the accumulated retirement allowance in consideration for his long service and fidelity to the company so long as there was no written term to the contrary. There was not.
The fifth issue on appeal was with the motion judge awarding Arnone compensation to replace the loss of his pension benefits during the notice period. The court chose not to interfere with the motion judge’s assessment as “a terminated employee is entitled to claim damages for the loss of pension benefits that would have accrued had the employee worked until the end of the notice period, unless some contractual term limits that right.” Again, no such term existed.
For the final issue on appeal, which was in fact Arnone’s cross-appeal, the Court had to decide whether the motion judge erred by failing to afford the parties an opportunity to disclose the offers to settle before deciding the issue of costs. The Court thought the motion judge had erred, and so remitted the issue back to him for redetermination.
Overall, the Court of Appeal reiterated the fact that a straight-forward claim for wrongful dismissal without cause is the type of case that is amenable to a Rule 20 summary judgment motion. This case demonstrates that even in the face of possibly conflicting evidence, it is possible for clients to be successful on a motion for summary judgment, whether it’s the first time around or on appeal.