Backman v. Hyundai Auto Canada Inc., (1990) 100 N.S.R.(2d) 24 (TD)

• Jurisdiction: Nova Scotia
• Court: Supreme Court of Nova Scotia (Canada)
• Judge: Davison, J.
• Citation: (1990), 100 N.S.R.(2d) 24 (TD)
• Date: 28 November 1990
• Subject Matter: EMPLOYMENT LAW,DAMAGES,EVIDENCE

Backman v. Hyundai (1990), 100 N.S.R.(2d) 24 (TD);

    272 A.P.R. 24

MLB headnote and full text

George Backman (plaintiff) v. Hyundai Auto Canada Inc. (defendant)

(S.H. No. 63307)

Indexed As: Backman v. Hyundai Auto Canada Inc.

Nova Scotia Supreme Court

Trial Division

Davison, J.

November 28, 1990.

Summary:

The plaintiff's employment was terminated shortly after he was charged with trafficking in narcotics. The employee was acquitted over one year later. The plaintiff claimed the defendant employer agreed to reinstate him or, alternatively, requested the court to exercise its jurisdiction to reinstate. Alternatively, the employee claimed damages for wrongful dismissal, general damages for mental distress and punitive damages. The employer claimed the employee resigned or, alternatively, was dismissed for just cause.

The Nova Scotia Supreme Court, Trial Division, allowed the action for wrongful dismissal and awarded damages equal to one year's remuneration. The court refused to award general damages for mental distress or punitive damages. The court stated that dismissing the employee solely to avoid adverse publicity, where the employer believed in his innocence, did not constitute cause for dismissal.

Damages - Topic 1326

Exemplary or punitive damages - Wrongful dismissal - A wrongfully dismissed employee claimed punitive damages - The Nova Scotia Supreme Court, Trial Division, refused to award punitive damages absent "harsh, vindictive, reprehensible and malicious conduct" by the defendant employer - See paragraphs 72 to 73.

Evidence - Topic 1128

Relevance and materiality - Relevance of evidence offered - Self-serving evidence - An employee dismissed after being charged with trafficking in narcotics submitted the employer agreed to reinstate him if he was acquitted - The employee sought to introduce evidence through a psychologist, his wife and a friend, of statements made by him to them supporting his submission - The Nova Scotia Supreme Court, Trial Division, stated that the statements of these witnesses were inadmissible as a form of "oath-helping" - The court stated that "such statements are not only excluded on the basis of the hearsay rule and by reason of their lack of probative value, but because statements could be manufactured for use in later proceedings" - See paragraphs 29 to 30.

Master and Servant - Topic 7502

Dismissal of employees - What constitutes - An employee charged with trafficking in narcotics had his employment terminated - The employee claimed he was dismissed; the employer claimed he resigned - The Nova Scotia Supreme Court, Trial Division, stated that the distinction was irrelevant - The employee was told to resign or be fired, accordingly, in either case it was a dismissal - See paragraphs 23 to 24.

Master and Servant - Topic 7568

Dismissal of employees - Grounds - Criminal conduct - An employee was dismissed after being charged with trafficking in narcotics - He was later acquitted - The sole reason for dismissal was the employer's desire to avoid perceived bad publicity - The employer believed in the employee's innocence and there was no evidence of misconduct, incompetence or neglect of duty - There was also no evidence that the employer was adversely affected by the publicity - The Nova Scotia Supreme Court, Trial Division, stated that the employer failed to prove cause for dismissal - See paragraphs 37 to 51.

Master and Servant - Topic 7614

Dismissal of employees - Defences - Resignation - [See Master and Servant - Topic 7502].

Master and Servant - Topic 8000

Dismissal without cause - Notice of dismissal - Reasonable notice - What constitutes - The 39 year old plaintiff was hired in November 1984 as District Sales Manager for Hyundai Auto Canada - He was promoted to Regional Sales Manager shortly before he was wrongfully dismissed in July 1986 after being charged with trafficking in narcotics (acquitted in September 1987) - The plaintiff had been pursued by Hyundai to leave his previous job - It was foreseeable that the plaintiff would have difficulty obtaining new employment pending the criminal charges - The Nova Scotia Supreme Court, Trial Division, awarded the plaintiff damages in lieu of notice equal to one year's remuneration - The court declined to award compensation for the whole period before his acquittal (one year plus two months) absent any effort to mitigate his loss by seeking new employment - See paragraphs 52 to 62.

Master and Servant - Topic 8063

Dismissal without cause - Damages - Mental distress - A wrongfully dismissed employee claimed general damages for mental stress attributable to the financial hardship resulting from his dismissal - The Nova Scotia Supreme Court, Trial Division, refused to award such damages - The court stated that "none of the actions of the defendant would give rise to an independent action and any loss is properly compensated by the damages awarded for failure to give notice. Furthermore, there were no circumstances ... which would have rendered mental suffering foreseeable at the time the employment contract was made" - The court was also not satisfied that pending criminal charges against the employee were not a major factor in the stress suffered - See paragraphs 67 to 71.

Master and Servant - Topic 8064

Dismissal without cause - Damages - Mitigation - [See Master and Servant - Topic 8000].

Master and Servant - Topic 8102

Dismissal without cause - Reinstatement - When available - A dismissed employee claimed that the court had jurisdiction, in special circumstances, to order reinstatement under a contract of employment - The Nova Scotia Supreme Court, Trial Division, stated that "it is difficult to conceive of what circumstances would render appropriate the remedy of reinstatement to a managerial position" - The court stated that, in any event, there were no such "special circumstances" in this case - See paragraphs 25 to 26.

Master and Servant - Topic 8102

Dismissal without cause - Reinstatement - When available - An employee charged with trafficking in narcotics was dismissed - After acquittal over one year later the employee sought reinstatement, alleging the employer agreed to take him back if he was acquitted - The Nova Scotia Supreme Court, Trial Division, accepted the employer's evidence that consideration would be given to rehiring the employee only if the matter was cleared up within a week or 10 days - Accordingly, there was no enforceable agreement where the matter was cleared up more than one year later and reinstatement was therefore not available - See paragraphs 27 to 36.

Cases Noticed:

Sobeys Stores Limited v. Yeomans and Labour Standards Tribunal (N.S.) et al. (1989), 92 N.R. 179; 90 N.S.R.(2d) 271; 230 A.P.R. 271 (S.C.C.), refd to. [para. 25].

Francis v. Municipal Councillors of Kuala Lumpur, [1962] 3 All E.R. 633, refd to. [para. 25].

R. v. Béland and Phillips, [1987] 2 S.C.R. 398; 79 N.R. 263; 9 Q.A.C. 293, appld. [para. 30].

Jones v. South-Eastern and Chatham Railway (1917), 87 L.J.K.B. 775 (C.A.), refd to. [para. 30].

R. v. Campbell (1977), 38 C.C.C.(2d) 6 (Ont. C.A.), refd to. [para. 30].

Scott Maritimes Pulp Ltd. v. B.F. Goodrich Can. Ltd. (1977), 19 N.S.R.(2d) 181; 24 A.P.R. 181, refd to. [para. 41].

E.S. Martin Construction Ltd. v. Penhorn Mall Ltd. (1975), 12 N.S.R.(2d) 331; 6 A.P.R. 331, refd to. [para. 41].

Walker v. Keating, Smith and Walker (1974), 6 N.S.R.(2d) 1 (C.A.), refd to. [para. 48].

Bardal v. Globe and Mail Limited (1960), 24 D.L.R.(2d) 140, consd. [para. 53].

Rahemtulla v. Vanfed Credit Union (1983), 4 C.C.E.L. 170 (B.C.S.C.), refd to. [para. 54].

Cathcart v. Longines Wittnauer Watch Co. (1980), 1 C.C.E.L. 298, refd to. [para. 57].

Michaels et al. v. Red Deer College (1975), 5 N.R. 99 (S.C.C.), refd to. [para. 59].

Cemco Electrical Manufacturing Co. Ltd. v. Van Snellenberg, [1947] S.C.R. 121, refd to. [para. 59].

Tindle v. Nabob Foods Limited (1979), 18 B.C.L.R. 107 (B.C.S.C.), refd to. [para. 61].

Vorvis v. Insurance Corporation of British Columbia (1989), 94 N.R. 321; 58 D.L.R.(4th) 193 (S.C.C.), consd. [para. 68].

Hadley v. Baxendale (1854), 9 Ex. 341, refd to. [para. 70].

Authors and Works Noticed:

Wrongful Dismissal Practice Manual, p. 209 [para. 24].

Counsel:

Michael E. Dunphy and Jocelyn M. Campbell, for the plaintiff;

Karin A. McCaskill and Ann Smith (articled clerk), for the defendant.

This action was heard on October 1-3 and 5, 1990, before Davison, J., of the Nova Scotia Supreme Court, Trial Division, who delivered the following judgment on November 28, 1990.