Monday, December 23, 2013

Bernier v. Nygard: Appeal Dismissed

Earlier this year, I made two entries about the Bernier v. Nygard case.

It's an interesting case, in large part because it involves the relatively unusual scenario of an employee obtaining judgment for a significant period of reasonable notice, relatively early in the notional notice period.  It had a very interesting treatment of mitigation, among other things.

The employer commenced an appeal, which was heard and decided this month.  This is another case where the Court of Appeal released its reasons orally, meaning that they are very brief.  But, again, there's some importance here.

It appears that the employer made four arguments on the appeal:  That the motion judge erred in rejecting the employer's allegation of an 'amending agreement'; that the reasonable notice period awarded was unfit; that the employee should not have been awarded her 2013 bonus; and that the decision to impose a 'trust' was incorrect.

Issue #1:  The Amending Agreement

If you read my earlier posts, you'll note that the employer claimed that an amending letter had been given to an employee, but their only evidence was a second-hand affidavit claiming on vague 'information and belief' that the employee had been given the letter.  Whether or not such a letter would have been effective to change the contract is another interesting legal challenge, but we don't get there here:  The Court of Appeal agreed with the motion judge that the employer had failed to lead evidence on the point, and rejected the employer's contention that the employee's evidence of the employer's usual practice constituted evidence of an amending agreement.

Issue #2:  The Reasonable Notice Period

Under all the circumstances, I can see the employer's argument that 18 months is high for this employee.  However, appellate courts don't generally tinker, and the Court of Appeal considered this to be "within the acceptable range".

Issue #3:  The Bonus

This is an important issue, and one that I've touched on in a number of entries:  Entitlement to a bonus during the reasonable notice period can be very tricky.

The Court of Appeal's commentary on this point is likely to be frequently cited in the future:
Had the plaintiff been given proper notice, she would have been employed as at November 30, 2013.  The appellant cannot disentitle the plaintiff to damages for the loss of her bonus by reason of its own breach.
There was also some issue raised about the calculation - the judge looked to prior years' bonus to calculate it, which the Court of Appeal considered acceptable.  In the appeal, the employer unsuccessfully sought to lead fresh evidence regarding the calculation.

Issue #4:  The Trust

This is one of the most interesting aspects of this case, because it's highly unusual:  The judgment was 'impressed with a trust', meaning that if the employee earns mitigation income during the reasonable notice period, she'll have to repay Nygard.  It's an interesting resolution to a difficult problem, even if it is imperfect, seeing as it has the impact of effectively relieving Bernier of the obligation to seek re-employment, and in fact giving her a disincentive to do so too actively.

The Court of Appeal approved of the approach, saying that it was "within the discretion of the motion judge", and did not render an injustice.

Once again, I have to highlight how quickly this case moved:  Ms. Bernier was dismissed on December 4, 2012, and within barely over a year she proceeded to have her claim decided, and successfully proceeded through an appeal.


This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

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