Carrigan v. Berkshire Securities Inc., (2010) 296 N.S.R.(2d) 42 (SC)

• Judge: Murphy, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: October 15, 2010
• Jurisdiction: Nova Scotia
• Citations: (2010), 296 N.S.R.(2d) 42 (SC);2010 NSSC 373

Carrigan v. Berkshire Securities Inc. (2010), 296 N.S.R.(2d) 42 (SC);

    940 A.P.R. 42

MLB headnote and full text

Temp. Cite: [2010] N.S.R.(2d) TBEd. OC.025

Glen Carrigan (plaintiff) v. Berkshire Securities Inc. (defendant)

(Hfx No. 194833; 2010 NSSC 373)

Indexed As: Carrigan v. Berkshire Securities Inc.

Nova Scotia Supreme Court

Murphy, J.

October 15, 2010.

Summary:

The plaintiff employee brought an action to recover approximately $275,000 which he claimed to have lost because the defendant employer altered terms of his employment and the basis of his compensation as a financial advisor.

The Nova Scotia Supreme Court dismissed the action.

Fraud and Misrepresentation - Topic 2508

Misrepresentation - General principles - Negligent misrepresentation - The plaintiff employee brought an action to recover approximately $275,000 which he claimed to have lost because the defendant employer altered terms of his employment and the basis of his compensation as a financial advisor - The plaintiff's claim was advanced entirely as a result of the change in his relationship with the defendant when the regional director role was eliminated and the Halifax branch changed from an associate to corporate office during 2001 - The plaintiff asserted that during negotiations leading to his employment the defendant made the untrue, inaccurate and misleading statement that he could develop its business in return for a 10% override on the gross earnings of all financial advisors whom he recruited - The plaintiff said this statement was made negligently, and that he relied on it to his detriment by leaving a lucrative position with Fortune Financial to work with the defendant - The Nova Scotia Supreme Court dismissed the action - The plaintiff did not advance evidence which established a negligent misrepresentation, and accepted the defendant's submissions that this aspect of the claim was without merit - In any event, the basis of the plaintiff's damages claim was inconsistent with the negligent misrepresentation which he said the defendant made - The plaintiff sought to recover damages incurred during 1998-2001, a period during which he received the overrides which he claimed to be the subject of the misrepresentation - See paragraphs 36 to 40.

Master and Servant - Topic 1195

Contract of hiring (employment contract) - Duration of contract - General - The plaintiff employee brought an action to recover approximately $275,000 which he claimed to have lost because the defendant employer altered terms of his employment and the basis of his compensation as a financial advisor - The plaintiff's claim was advanced entirely as a result of the change in his relationship with the defendant when the regional director role was eliminated and the Halifax branch changed from an associate to corporate office during 2001 - The plaintiff asserted that by unilaterally changing his conditions of employment during 2001, the defendant breached an oral agreement which included a term that the plaintiff would act as the defendant's regional director in Atlantic Canada for a sufficient period of time to allow him to recoup and profit from his personal investment developing the defendant's business following the associate model - The Nova Scotia Supreme Court dismissed the action - The relationship between the parties was governed by an oral agreement which did not contain a duration term - There was no term in a contract between the parties which determined how long the associate compensation arrangement would last - See paragraphs 41 to 45.

Master and Servant - Topic 7502

Dismissal or discipline of employees - General principles - What constitutes dismissal or discharge - Constructive dismissal - The plaintiff employee brought an action to recover approximately $275,000 which he claimed to have lost because the defendant employer altered terms of his employment and the basis of his compensation as a financial advisor - The plaintiff's claim was advanced entirely as a result of the change in his relationship with the defendant when the regional director role was eliminated and the Halifax branch changed from an associate to corporate office during 2001 - The plaintiff asserted that he had been constructively dismissed - The Nova Scotia Supreme Court agreed - The defendant's July 1, 2001 elimination of the plaintiff's duties outside the Halifax branch and imposition of the corporate model on the plaintiff's remaining relationship constituted constructive dismissal - Although the plaintiff retained compensation payments totaling approximately $100,000 and continued his employment under the corporate model until July 2002, he did not accept the model change and agree to the compensation received, and he did not forego his right to pursue a constructive dismissal claim - See paragraphs 46 to 50.

Master and Servant - Topic 7704

Dismissal or discipline of employees - Damages for wrongful dismissal - Measure of damages for wrongful dismissal - The plaintiff employee brought an action to recover approximately $275,000 which he claimed to have lost because the defendant employer altered terms of his employment and the basis of his compensation as a financial advisor - The plaintiff's claim was advanced entirely as a result of the change in his relationship with the defendant when the regional director role was eliminated and the Halifax branch changed from an associate to corporate office during 2001 - The damages sought by the plaintiff were based on "reliance damages" of $274,180 as calculated in the Casey Report representing lost personal production and expenses incurred while developing the Atlantic region for the defendant - The Nova Scotia Supreme Court dismissed the action - The plaintiff had been constructively dismissed - The first task when assessing damages for constructive dismissal was usually to determine the appropriate notice term, and then assess what a plaintiff's remuneration for that period would have been - In this case, however, a different approach could be adopted, as the evidence indicated that the plaintiff had already received $100,000 compensation, which could be deemed remuneration in lieu of notice - Because the maximum reduction in the plaintiff's income attributable to the constructive dismissal was $60,000 annually, or $5,000 per month, the $100,000 which he had already received represented payment in lieu of notice for a period of 20 months - The plaintiff could only recover additional compensation from the defendant if he was entitled to notice of termination exceeding 20 months - The court had not been provided with any authority suggesting that an employee in the plaintiff's circumstances should have more than 20 months' notice - The plaintiff's employment relationship with the defendant prior to the constructive dismissal was relatively short (less than 3.5 years); he was not recruited by the defendant but had vigorously sought the associate model position, and he was able to mitigate his loss, at least to some extent, by continuing to work under the defendant's corporate model until July 2002, when he moved immediately to a position with a different employer in the same industry - The change from the associate to corporate model occurred when the plaintiff was less than 40 years old, and he had been able to pursue alternate career options - See paragraphs 51 to 81.

Master and Servant - Topic 8000

Dismissal without cause - Notice of dismissal - What constitutes reasonable notice - [See Master and Servant - Topic 7704 ].

Master and Servant - Topic 8000

Dismissal without cause - Notice of dismissal - What constitutes reasonable notice - The plaintiff employee brought an action to recover approximately $275,000 which he claimed to have lost because the defendant employer altered terms of his employment and the basis of his compensation as a financial advisor - The plaintiff's claim was advanced entirely as a result of the change in his relationship with the defendant when the regional director role was eliminated and the Halifax branch changed from an associate to corporate office during 2001 - The plaintiff asserted that during discussions between July and October 2001 the defendant agreed to reimburse expenses and compensate the plaintiff for lost personal production on the basis that after joining Berkshire in 1998 his assets under administration would have increased by the same annual amount as during his final year of employment with Fortune Financial, had he not been developing regional offices for the defendant - The Nova Scotia Supreme Court dismissed the action - Although the plaintiff was pressing hard for acceptance of his proposal for compensation, he had not established that the defendant committed to compensate him by paying reliance damages based upon lost production and expense reimbursement - See paragraphs 21 to 35.

Cases Noticed:

Arrow Construction Products Ltd. v. Nova Scotia (Attorney General) (1996), 150 N.S.R.(2d) 241; 436 A.P.R. 241; 1996 CarswellNS 149 (C.A.), refd to. [para. 38].

Northern Petroleum v. Sydney Steel Corp. (1999), 180 N.S.R.(2d) 141; 557 A.P.R. 141; 1999 CarswellNS 341 (S.C.), affd. (2000), 202 N.S.R.(2d) 144; 632 A.P.R. 144; 2000 CarswellNS 253 (C.A.), refd to. [para. 38].

Queen (D.J.) v. Cognos Inc., [1993] 1 S.C.R. 87; 147 N.R. 169; 60 O.A.C. 1; 1993 CarswellOnt 801, refd to. [para. 39].

King v. Solna Offset of Canada Ltd. (1984), 3 O.A.C. 178; 1984 CarswellOnt 904 (C.A.), refd to. [para. 50].

Ramey v. Wilder Mobility Ltd., [2004] O.T.C. Uned. 619 (Sup. Ct.), refd to. [para. 57].

Hubrisca Enterprises Ltd. et al. v. Canada (Attorney General), [2001] B.C.T.C. 238 (S.C.), refd to. [para. 58].

Granitile Inc. et al. v. Canada et al. (1998), 82 O.T.C. 84 (Gen. Div.), refd to. [para. 58].

Spurway v. Royal LePage Real Estate Services Ltd. (1987), 77 N.S.R.(2d) 156; 191 A.P.R. 156 (T.D.), refd to. [para. 59].

Vorvis v. Insurance Corp. of British Columbia, [1989] 1 S.C.R. 1085; 94 N.R. 321, refd to. [para. 63].

Schimp v. RCR Catering Ltd. et al. (2004), 221 N.S.R.(2d) 379; 697 A.P.R. 379; 2004 NSCA 29, refd to. [para. 78].

Jessen v. CHC Helicopters International Inc. (2006), 245 N.S.R.(2d) 316; 777 A.P.R. 316; 2006 NSCA 81, refd to. [para. 78].

Mourant v. Amherst (Town) (1999), 177 N.S.R.(2d) 75; 542 A.P.R. 75 (S.C.), refd to. [para. 78].

Barakett v. Lévesque Beaubien Geoffrion Inc. (2001), 198 N.S.R.(2d) 135; 621 A.P.R. 135; 2001 NSCA 157, refd to. [para. 78].

Musgrave v. Levesque Securities Inc. (2000), 183 N.S.R.(2d) 349; 568 A.P.R. 349 (S.C.), refd to. [para. 78].

Carter v. Bell & Sons (Canada) Ltd., [1936] O.R. 290 (C.A.), refd to. [para. 79].

Paper Sales Corp. v. Miller Brothers Co. (1962) Ltd. (1975), 55 D.L.R.(3d) 492 (Ont. C.A.), refd to. [para. 79].

Marbry et al. v. Avrecan International Inc. (1999), 119 B.C.A.C. 266; 194 W.A.C. 266; 1999 BCCA 172, refd to. [para. 79].

Authors and Works Noticed:

Echlin, Randall Scott, and Fantini, Jennifer M., Quitting for Good Reason: The Law of Constructive Dismissal in Canada (2001), p. 57 [para. 50].

Waddams, Stephen M., The Law of Contracts (4th Ed. 1999), p. 515 [para. 57].

Counsel:

George MacDonald, Q.C., and Jane O'Neill, for the plaintiff;

Colin M. Piercey and Rick Dunlop, for the defendant.

This action was heard on February 2 to 9, 2010, at Halifax, Nova Scotia, by Murphy, J., of the Nova Scotia Supreme Court, who delivered the following judgment on October 15, 2010.