Cabiakman v. Industrielle Alliance Compagnie d'assurance sur la vie, (2004) 325 N.R. 1 (SCC)

• Judge: Iacobucci, Bastarache, Binnie, Arbour, LeBel, Deschamps, and Fish, JJ.
• Court: Supreme Court (Canada)
• Case Date: March 19, 2004
• Jurisdiction: Canada (Federal)
• Citations: (2004), 325 N.R. 1 (SCC);2004 SCC 55;JE 2004-1543;[2004] 3 SCR 195;AZ-50264378;36 CCEL (3d) 30;242 DLR (4th) 1;EYB 2004-68723;325 NR 1;DTE 2004T-775

Cabiakman v. Ind. Alliance Life (2004), 325 N.R. 1 (SCC)

MLB headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Temp. Cite: [2004] N.R. TBEd. JL.019

L'Industrielle-Alliance Compagnie d'Assurance sur la Vie (appelante) v. Gilbert Cabiakman (intimé)

(29584; 2004 SCC 55; 2004 CSC 55)

Indexed As: Cabiakman v. Industrielle Alliance Compagnie d'assurance sur la vie

Supreme Court of Canada

Iacobucci, Bastarache, Binnie, Arbour, LeBel, Deschamps, and Fish, JJ.

March 19, 2004.

Summary:

The employer sold life insurance, related products and investment products. The employee was branch sales director. In 1995, the employee was arrested for attempted extortion. To protect its image, reputation and integrity, the employer suspended the employee without pay pending completion of the criminal proceedings against him. In 1997, the employee was acquitted. He returned to work with the employer. The employee sued the employer for damages for lost income, moral and punitive damages and damages for inconvenience. Damages were agreed at $200,000.

The Quebec Superior Court, in a decision reported [2000] R.J.Q. 1508; [2000] R.J.D.T. 504, allowed the action, but only in the amount of $175,000. The employer appealed.

The Quebec Court of Appeal dismissed the appeal and awarded the full $200,000 agreed to. The employer appealed.

The Supreme Court of Canada dismissed the appeal.

Quebec Nominate Contracts - Topic 6414

Employment contracts - General - Suspen­sion of employees - The Supreme Court of Canada discussed the employer's power, under a contract of employment governed by the Civil Code of Québec, to suspend employees for administrative reasons be­cause of acts of which the employee was accused - The court held that the power to suspend was an integral part of any con­tract of employment, but was limited and had to be exercised in accordance with the following requirements: (1) the action was necessary to protect legitimate business interests; (2) the employer must be guided by good faith and the duty to act fairly; (3) the temporary interruption of the employ­ee's performance of the work must be im­posed for a relatively short period that is or can be fixed, or else it would be little different from a resiliation or dismissal pure and simple; and (4) the suspension must, other than in exceptional circum­stances that did not apply here, be with pay - See paragraphs 54 to 68.

Quebec Nominate Contracts - Topic 6414

Employment contracts - General - Suspen­sion of employees - An employer sus­pend­ed an employee without pay pending the completion of criminal proceedings against the employee - The employee was ac­quitted - He returned to work for the em­ployer - The employee sued the employer for damages for lost income, etc. - The action was allowed - The Supreme Court of Canada ruled: "It should be noted that preventive action taken by an employer in good faith to protect its repu­tation, its customers or the image of the service it manages or the product it sells does not jeopardize the presumption of innocence in favour of an employee against whom crim­i­nal charges have been laid. Nor will an employer generally have to make its own inquiries, either of the employee or of the competent public auth­orities, to ensure that the charges are well-founded. However, it has an obligation to allow the employee to explain the situation if the employee wishes to make representa­tions and provide his or her version of the facts" - See para­graphs 54 to 68.

Quebec Nominate Contracts - Topic 6414

Employment contracts - General - Suspen­sion of employees - The employer sold life insurance, related products and investment products - The employee was branch sales director - In 1995, the employee was ar­rested for attempted extortion - To pro­tect its image, reputation and integrity, the employer suspended the employee without pay pending completion of the criminal proceedings against him - In 1997, the employee was acquitted - He returned to work with the employer - The employee sued the employer for damages for lost income, etc. - The employment contract was silent respecting the employer's right to suspend - The legal situation here was governed solely by the Civil Code of Qué­bec and the individual contract in issue - The action was allowed - The Supreme Court of Canada ruled that the suspension here was justified but not the failure to pay the employee's salary - In the instant case, in the context of a suspension that at all times remained administrative in nature, there was no reason to refuse to pay the salary of an employee who remained avail­able to work - It was not open to the em­ployer to unilaterally impose a tempor­ary cessation of performance of the cor­relative obligations while requiring that the em­ployee continue to be available - The em­ployee was not required to endure the sus­pension, imposed on him by the employer, of the performance of his work and also be denied the consideration for that work, namely his salary - This con­clusion, which was entirely consistent with the majority of the decisions of specialized labour law trib­unals involving the applica­tion of col­lective agreements, was based on the na­ture of the reciprocal obligations created by an individual contract of emplo­yment governed by the Civil Code.

Cases Noticed:

Air-Care Ltd. v. United Steel Workers of America, [1976] 1 S.C.R. 2; 3 N.R. 267, refd to. [para. 39].

Paquet c. Laurier Auto Inc., [1987] R.J.Q. 804; 6 Q.A.C. 84 (C.A.), refd to. [para. 50].

Thomas v. Surveyer, Nenniger & Chêne­vert Inc. (1989), 34 Q.A.C. 61 (C.A.), refd to. [para. 51].

Syndicat du personnel de soutien du Cégep François-Xavier Garneau v. Cégep Fran­çois-Xavier Garneau, [2003] Q.J. No. 3580 (C.A.), refd to. [para. 53].

Centre d'adaptation jeunesse inc. v. Syn­dicat canadien de la fonction publique (1986), 5 Q.A.C. 241 (C.A.), consd. [para. 53].

Reference Re Public Service Employee Relations Act (Alta.) - see Reference Re Compulsory Arbitration.

Reference Re Compulsory Arbitration, [1987] 1 S.C.R. 313; 74 N.R. 99; 78 A.R. 1, refd to. [para. 63].

Wallace v. United Grain Growers Ltd., [1997] 3 S.C.R. 701; 219 N.R. 161; 123 Man.R.(2d) 1; 159 W.A.C. 1, refd to. [para. 63].

Sûreté du Québec et Association des poli­ciers provinciaux du Québec, Re, [1991] T.A. 666, refd to. [para. 66].

Fraternité des policiers de la Communauté urbaine de Montréal et Communauté urbaine de Montréal, [1984] T.A. 668, consd. [para. 66].

C.U.M. et Fraternité des policiers de la C.U.M., D.T.E. 86T-312, refd to. [para. 67].

Cie minière Québec Cartier v. Quebec (Grievances Arbitrator) - see Compagnie minière Québec Cartier v. Métallurgistes unis d'Amérique, local 6869.

Compagnie minière Québec Cartier v. Métallurgistes unis d'Amérique, local 6869, [1995] 2 S.C.R. 1095; 183 N.R. 313, refd to. [para. 67].

Associations des pompiers de Sherbrooke et Sherbrooke (Ville de), Re, [1989] T.A. 211, refd to. [para. 69].

United Automobile Workers, Local 127 v. Eaton Springs Canada Ltd. (1969), 21 L.A.C. 50, refd to. [para. 69].

United Steelworkers, Local 3129 & Mof­fats Ltd., Re (1956), 6 L.A.C. 327, refd to. [para. 69].

Pharand et Gatineau (Ville de), Re, D.T.E. 2003T-943, refd to. [para. 70].

Deux-Montagnes (Ville de) et Fraternité des policiers de Deux-Montagnes/Sainte-Marthe-sur-le-Lac, Re, [2002] R.J.D.T. 1683, refd to. [para. 70].

James Bay Lodge and Construction & General Workers' Union, Local 602, Re (1993), 33 L.A.C.(4th) 23, refd to. [para. 70].

Kimberly-Clark of Canada Ltd. and Cana­dian Paperworkers' Union, Local 307, Re (1981), 30 L.A.C. 316, refd to. [para. 70].

Columbia Builders Supplies Co. v. Bartlett, [1967] B.R. 111, refd to. [para. 72].

Lefebvre v. HOJ Industries Ltd.; Machtin­ger v. HOJ Industries Ltd., [1992] 1 S.C.R. 986; 136 N.R. 40; 53 O.A.C. 200, refd to. [para. 72].

Machtinger v. HOJ Industries Ltd. - see Lefebvre v. HOJ Industries Ltd.; Mach­tinger v. HOJ Industries Ltd.

Internote Canada Inc. v. Commission des normes du travail, [1989] R.J.Q. 2097 (C.A.), refd to. [para. 74].

Statutes Noticed:

Civil Code of Québec, S.Q. 1991, c. 64, art. 1380, art. 1383 [para. 27]; art. 1379, art. 1432 [para. 73]; art. 1434 [para. 74]; art. 1435, art. 1436, art. 1437 [para. 73]; art. 1605 [para. 48]; art. 2085 [para. 27]; art. 2087, art. 2088 [para. 29]; art. 2091 [para. 72]; art. 2094 [para. 59].

Labour Code, R.S.Q. 1977, c. C-27, sect. 14 [para. 44]; sect. 109.1, sect. 110 [para. 41].

Labour Standards, Act respecting, R.S.Q. 1977, c. N-1.1, sect. 79.4 [para. 42]; sect. 82 [para. 74].

Authors and Works Noticed:

Athanassiadis, Mimikos, Sources of Disci­plinary Power: an Analysis of the Empl­oyment Contract (1998), 5 R.E.J. 267, generally [para. 45].

Bich, Marie-France, Contracts of Employ­ment, in Reform of the Civil Code: Obli­gations (1993), vol. 2-B, pp. 8, 9 [para. 48, English version]; 11, 12 [para. 45, English version].

Bich, Marie-France, Le contrat de travail, in La réforme du Code civil: obligations, contrats nommés (1993), pp. 757 to 759 [para. 48, French version]; 763 to 765 [para. 45, French version].

Bich, Marie-France, Le pouvoir discipli­naire de l'employeur - fondements civils (1988), 22 R.J.T. 85, generally [para. 45].

Bonhomme, Robert, Gascon, Clément, and Lesage, Laurent, Le contrat de travail en vertu du Code civil du Québec (1994), para. 4.3.2 [para. 47].

Brown, D.J.M., and Beatty, D.M., Cana­dian Labour Arbitration (2nd Ed. 1984), generally [para. 66].

Côté, Pierre-André, Interprétation des lois (3e éd. 1999), p. 512 [para. 58, French version].

Côté, Pierre-André, The Interpretation of Legislation in Canada (3rd Ed. 2000), p. 405 [para. 58, English version].

D'Aoust, Claude, Leclerc, Louis and Tru­deau, Gilles, Les mesures disciplinaires: étude jurisprudentielle et doctrinale (1982), monograph No. 13, pp. 56, 57 [para. 45].

Gagnon, Robert P., Le droit du travail du Québec: pratiques et théories (5th Ed. 2003), pp. 96, 97 [para. 48]; 98 [para. 45]; 120 [para. 59].

Morin, Fernand, Brière, Jean-Yves, Le droit et l'emploi au Québec (2nd Ed. 2003), paras. II-113, II-114, II-116, II-117, II-118 [para. 45]; II-115 [paras. 34, 45]; II-160 [paras. 34, 35, 47].

Counsel:

Michel St-Pierre and Jacques Reeves, for the appellant, L'Industrielle-Alliance Compagnie d'Assurances sur la Vie;

Raphael Levy, for the respondent, Cabiak­man.

Solicitors of Record:

Beauvais Truchon & Associés, Québec, Quebec, for the appellant, L'Industrielle-Alliance Compagnie d'Assurance sur la Vie;

Madar Benabou Malamud & Levy, Mont­réal, Quebec, for the respondent, Cabiak­man.

This appeal was heard on March 19, 2004, by Iacobucci, Bastarache, Binnie, Arbour, LeBel, Deschamps, and Fish, JJ., of the Supreme Court of Canada.

The judgment of the Supreme Court of Canada was delivered on March 19, 2004 with written reasons filed jointly in both official languages by LeBel and Fish, JJ., on July 29, 2004.

Arbour, J., joined in the judgment of March 19, 2004, but took no part in the reasons for judgment.