TORONTO, May 25, 2018 /CNW/ - A $1.7 million claim alleging fraud, breach of fiduciary duty, and unjust enrichment against an ex-President of Keddco Mfg. (2011) Ltd. (a division of Canerector) was ruled to be completely unfounded recently by Her Honour Justice Chiappetta of the Ontario Superior Court of Justice in Toronto. Her Honour awarded the employee 19 months' worth of compensation, including contributions to RRSP, car allowance, health and dental benefits, as well as cash bonus for time-worked and during the 19-month period.
The award is notable for the large severance found owing, made larger by the cause accusations. The decision is important not just for its high severance but also for its award of extraordinary damages due to the manner of termination and litigation that ensued. Justice Chiappetta awarded $100,000 in punitive damages and $25,000 in moral damages, to punish the corporation and compensate its former employee for:
Threatening a large counter-claim if the ex-employee pursued his rights in civil court
Pursing the large counter-claim as threatened
Threatening other employees in a similar manner
Intimidating the employee during the termination meeting
Lack of disclosure prior to pursuing the $1.7 million counter claim against the employee
Making public personal attacks only to drop the cause of action during the trial
Completely unfounded yet very serious allegations of fraud
The devastation and stress the employee felt as a result of the massive counter claim sustained during years-long litigation
The total amount awarded was over $600,000 plus interest and costs. In Ontario's 'loser pays' system the winner has part of their costs covered. The amount of costs has yet to be determined.
Toronto Employment Lawyers Andrew Monkhouse and Samantha Lucifora represented Scott Ruston in the matter before the Ontario Superior Court.
Canerector, a large yet typically private family-owned company has had a large number of wrongful dismissal claims and have taken a number of them to final judgment and often appeal. Many of these cases are of high-level employees.
"The case shows that employees, with proper legal support, are able to fight back against even the largest of companies and get what they are entitled to." Said Andrew Monkhouse, co-counsel and founder of Monkhouse Law.
"This decision is a reminder to companies of their obligation to be candid and honest with employees, particularly during and after termination, a vulnerable time." Said Samantha Lucifora, co-counsel during the 11-day trial.
"It is also a stark reminder that a Court's role is not to second guess the decisions made by senior management because the Board of Directors or parent company, with the benefit of hindsight, is not happy with the decision." - Samantha Lucifora