Squires v. Corner Brook Pulp and Paper Ltd. and Manuel, (1999) 175 Nfld. & P.E.I.R. 202 (NFCA)

• Judge: Marshall, Cameron and Green, JJ.A.
• Court: Court of Appeal (Newfoundland)
• Case Date: May 10, 1999
• Jurisdiction: Newfoundland and Labrador
• Citations: (1999), 175 Nfld. & P.E.I.R. 202 (NFCA)

Squires v. Corner Brook Pulp (1999), 175 Nfld. & P.E.I.R. 202 (NFCA);

    537 A.P.R. 202

MLB headnote and full text

Temp. Cite: [1999] Nfld. & P.E.I.R. TBEd. JN.012

Robert A. Squires (appellant) v. Corner Brook Pulp and Paper Limited (first respondent) and John Manuel (second respondent)

(94/199)

Indexed As: Squires v. Corner Brook Pulp and Paper Ltd. and Manuel

Newfoundland Supreme Court

Court of Appeal

Marshall, Cameron and Green, JJ.A.

May 10, 1999.

Summary:

A newsprint mill dismissed Squires, a mechanical engineer, without notice. Squires sued his employer for wrongful dismissal and claimed punitive and exemplary dam­ages. He also sued Manuel, the mill's gen­eral manager, for the tort of inducement of breach of contract.

The Newfoundland Supreme Court, Trial Division, in a decision reported at 122 Nfld. & P.E.I.R. 91; 379 A.P.R. 91, dismissed the claim against Manuel and awarded him solicitor and client costs. The court held that Squires was entitled to 15 months' pay in lieu of notice. The court dismissed the claim for punitive and exemplary damages. The mill applied for an order that monies it paid into court be paid over to Squires less all deductions required by law.

The Newfoundland Supreme Court, Trial Division, in a decision reported at 141 Nfld. & P.E.I.R. 150; 443 A.P.R. 150, determined the amount to be paid over to Squires. Squires appealed the dismissal of the action against Manuel, the 18 month notice period, the reduction of the notice period by three months for failure to mitigate, the award of solicitor and client costs to Manuel and his costs award for one day only. Squires alleged bias against the trial judge. The employer appealed the award of prejudgment interest from the date of termination, submit­ting that interest should have been awarded on a graduated basis in accordance with s. 4(2) of the Judgment Interest Act.

The Newfoundland Court of Appeal allowed the appeal in part and allowed the cross-appeal.

Company Law - Topic 4566

Officers and agents - Liability - General - For tortious acts - An employer dismissed an employee without cause - The employee sued the employer and his supervisor for wrongful dismissal and claimed, inter alia, punitive and exemplary damages - He also claimed against the supervisor for induce­ment of breach of contract - The trial judge dismissed the claims for punitive and exemplary damages and the action against the supervisor - The employee appealed - The Newfoundland Court of Appeal stated that "[t]he general principle of law is that persons are responsible for their own con­duct. However, there is an exception to that general principle, which arises in the context of action taken on behalf of a corporation" - The court upheld the trial judge's decision that the supervisor did not induce a breach of the employment con­tract - See paragraphs 91 to 116.

Company Law - Topic 4665

Officers and agents - Liability to third parties - For torts - [See Company Law - Topic 4566 ].

Courts - Topic 555

Judges - Powers - To intervene in examin­ation of witnesses - An appellant submitted that the trial judge demonstrated bias in the conduct of the trial in his rulings, com­ments and questions - The Newfoundland Court of Appeal disagreed, stating that "[t]he examinations per curiam were a measured and acceptable means of clarify­ing matters upon which there was conflict­ing evidence and upon which the trial judge would likely be required to make findings of fact. The examinations per curiam were sensitive to the differing positions of the parties and adequately protected their respective interests." - See paragraph 39.

Courts - Topic 686

Judges - Disqualification - Bias - By trial judge - [See Courts - Topic 555 ].

Courts - Topic 686

Judges - Disqualification - Bias - By trial judge - The appellant submitted that the trial judge demonstrated bias in the con­duct of the trial in errors in findings of fact and prejudged the matter - The New­foundland Court of Appeal disagreed, stating that "[t]he appellant was able to identify a few errors in findings of fact but these are of a minor nature and do not undermine the trial judge's decision as a whole." - See paragraph 70.

Damages - Topic 911

Aggravation - In contract - Aggravated damages - Wrongful dismissal - [See Damages - Topic 1296 ].

Damages - Topic 1296

Exemplary or punitive damages - General -A newsprint mill dismissed Squires, a mechanical engineer, without notice or cause - Squires sued for wrongful dis­missal, seeking, inter alia, aggravated and punitive damages - The Newfoundland Court of Appeal stated that, to succeed in his claims for aggravated and punitive damages, Squires had to establish a separ­ate actionable course of conduct, which he failed to do - Further, the conduct of the employer fell short of being so "harsh, vindictive, reprehensible and malicious" as to merit punitive damages - See paragraphs 72 to 84.

Damages - Topic 1326

Exemplary or punitive damages - Wrongful dismissal - [See Damages - Topic 1296 ].

Evidence - Topic 4245

Witnesses - Privilege - Lawyer-client communications - Offers of settlement or settlement negotiations - Squires sued for wrongful dismissal - On appeal, he sub­mitted that the trial judge erred in refusing to admit into evidence a letter, written by his then counsel - The letter was part of "without prejudice" correspondence under the umbrella of settlement discussions - At trial, Squires argued that the privilege was his as the letter was from his solicitor to a representative of the employer and, there­fore, he could waive the privilege - The Newfoundland Court of Appeal disagreed -The privilege which arose in respect of correspondence sent in the context of an attempt to negotiate the settlement of a dispute was a joint privilege - Therefore, the correspondence could not be placed in evidence without the consent of both parties - See paragraph 88.

Interest - Topic 5104

Interest as damages (prejudgment interest) - Breach of contract - Employment con­tracts - A trial judge stated that "... dam­ages, in lieu of notice, for a terminated employee arise on the date of termination. Accordingly, interest on such damages become effective from the same date." - The employer appealed the prejudgment interest award, submitting that prejudgment interest should have been awarded on a graduated basis in accordance with s. 4(2) of the Judgment Interest Act - The New­foundland Court of Appeal agreed with the employer and modified the prejudgment interest award accordingly - See para­graphs 117 to 120.

Master and Servant - Topic 8000

Dismissal without cause - Notice of dis­missal - What constitutes reasonable notice - A newsprint mill dismissed Squires, a mechanical engineer, without notice or cause - Squires sued for wrongful dis­missal - The Newfoundland Court of Appeal held that 18 months was a reason­able notice period but awarded Squires an extra six months notice because of the manner of his dismissal - The employer knew or should have known from the beginning that there was no just cause but it attempted to arrive at a settlement by threatening to use a false claim of just cause - Squires, up to that point, had never been given any reason to doubt that he was considered a valued employee doing a good job - While the employer had every right to dismiss Squires, its manner of doing so fell short of the fair dealing required by case law.

Master and Servant - Topic 8008

Dismissal without cause - Notice of dis­missal - Notice period - Pay in lieu of - [See Master and Servant - Topic 8000 ].

Master and Servant - Topic 8064

Dismissal without cause - Damages - Mitigation - A mill dismissed Squires, a 47 year old mechanical engineer in middle management, without cause - It was his first job - After three years as a project engineer, Squires had been placed in charge of the engineering department where he served for 14 years - No promo­tion potential - The trial judge determined that Squires was entitled to a reasonable notice period of 18 months, but deducted three months because Squires refused to take advantage of a professional placement firm retained by the mill - The Newfound­land Court of Appeal held that Squires did not fail to mitigate - He sought employ­ment immediately after his dismissal, albeit with his former employer - That was a reasonable avenue to pursue - It was not unreasonable for Squires not to travel to Halifax to meet with the placement firm until that avenue had fallen through - See paragraphs 87 to 90.

Practice - Topic 7030

Costs - Party and party costs - Entitlement to - Where success or fault divided - An employer dismissed an employee without cause - The employee sued the employer and his supervisor for wrongful dismissal and claimed punitive and exemplary dam­ages - The trial, scheduled for one day, took four days - Most of the four days was expended on the claim for punitive and exemplary damages, all of which were unsuccessful - The employee succeeded on his claim for an increased notice period - The trial judge allowed the employee his costs and travel expenses for one day and one return trip and ordered the employer and the employee to bear the remainder of their own costs - The Newfoundland Court of Appeal refused to interfere with the costs award made against the company - See paragraphs 121 to 125.

Practice - Topic 7457

Costs - Solicitor and client costs - Entitle­ment to - Where claim irrelevant, scandal­ous or without merit - An employer dis­missed an employee without cause - The employee sued the employer and his super­visor for wrongful dismissal and claimed punitive and exemplary damages - The claims for punitive and exemplary damages were dismissed - The trial judge awarded solicitor and client costs to the supervisor, where there was no claim against him because his actions were taken on behalf of the company and the allegations against him of "malicious and vindictive conduct of a base nature" were unsupported by the evidence - The Newfoundland Court of Appeal reduced the costs award to party and party costs - The case could not have been dismissed prior to trial - The employee sincerely believed that the super­visor committed the alleged misconduct - The employee was not motivated by maliciousness - See paragraphs 121 to 131.

Practice - Topic 9043

Appeals - Law on appeal - Change in law between trial and appeal - An employee sued for damages for wrongful dismissal - He appealed the trial judge's decision - The Newfoundland Court of Appeal stated that "... when the decision was filed, absent an independent cause of action, the plain­tiff was limited to damages for failure to give reasonable notice of termination though it was possible that if the manner of dismissal itself had had an impact on the prospects for re-employment a greater notice period would be considered appro­priate. However, Wallace [v. United Grain Growers (S.C.C.)] added to the law and any decision of this court regarding the correctness of the decision of the trial judge must be made in light of the current state of the law." - See paragraph 76.

Torts - Topic 5208

Interference with economic relations - Contracts - Inducing or procuring breach of contract - The Newfoundland Court of Appeal stated that "[t]o succeed in an action for inducement of breach of con­tract, a plaintiff must establish 1. The existence of a valid and enforceable con­tract; 2. Knowledge by the defendant of the existence of the contract; 3. An inten­tional act by the defendant to cause a breach of the contract; 4. Wrongful inter­ference on the part of the defendant; and 5. Damage suffered by the plaintiff." - See paragraph 93.

Torts - Topic 5208

Interference with economic relations - Contracts - Inducing or procuring breach of contract - [See Company Law - Topic 4566 ].

Cases Noticed:

Vorvis v. Insurance Corp. of British Col­umbia, [1989] 1 S.C.R. 1085; 94 N.R. 321; 58 D.L.R.(4th) 193; [1989] 4 W.W.R. 218; 36 B.C.L.R.(2d) 273; 90 C.L.L.C. 14,035; 25 C.C.E.L. 81, refd to. [para. 6].

Wallace v. United Grain Growers Ltd. (1997), 219 N.R. 161; 123 Man.R.(2d) 1; 159 W.A.C. 1; 152 D.L.R.(4th) 1 (S.C.C.), appld. [para. 6].

R. v. Brouillard, [1985] 1 S.C.R. 39; 57 N.R. 168, refd to. [para. 21].

R. v. Torbiak and Campbell (1974), 18 C.C.C.(2d) 229 (Ont. C.A.), refd to. [para. 22].

Connor v. Brant (Township) (1914), 31 O.L.R. 274 (C.A.), refd to. [para. 34].

McHugh v. City Motors (Nfld.) Ltd. (1989), 74 Nfld. & P.E.I.R. 263; 231 A.P.R. 263; 58 D.L.R.(4th) 753 (Nfld. C.A.), refd to. [para. 71].

Trask v. Terra Nova Motors Ltd. (1995), 127 Nfld. & P.E.I.R. 310; 396 A.P.R. 310 (Nfld. C.A.), refd to. [para. 71].

Farber v. Compagnie Trust Royal, [1997] 1 S.C.R. 846; 210 N.R. 161, refd to. [para. 71].

Bardal v. Globe & Mail Ltd. (1960), 24 D.L.R.(2d) 140 (Ont. H.C.), refd to. [para. 77].

Jivrag v. Calgary (City) and Calgary Parking Authority (1986), 71 A.R. 87; 13 C.C.E.L. 120 (Q.B.), revd. in part (1987), 18 C.C.E.L. xxx (Alta. C.A.), refd to. [para. 79].

Dunning v. Royal Bank (1996), 23 C.C.E.L.(2d) 71 (Ont. Gen. Div.), refd to. [para. 79].

Corbin v. Standard Life Assurance Co. et al. (1995), 167 N.B.R.(2d) 355; 427 A.P.R. 355; 15 C.C.E.L.(2d) 71 (C.A.), refd to. [para. 79].

Ribeiro v. Canadian Imperial Bank of Commerce et al. (1989), 67 O.R.(2d) 385 (H.C.), varied (1992), 13 O.R.(3d) 278 (C.A.), refd to. [para. 82, footnote 23].

Dixon v. British Columbia Transit (1995), 13 C.C.E.L.(2d) 272 (B.C.S.C.), refd to. [para. 83].

Truckers Garage Inc. v. Krell (1993), 68 O.A.C. 106 (C.A.), refd to. [para. 93].

Said v. Butt, [1920] 3 K.B. 497, refd to. [para. 95].

Kepic v. Tecumseh Road Builders et al. (1987), 23 O.A.C. 72; 18 C.C.E.L. 218 (C.A.), refd to. [para. 95].

Imperial Oil Ltd. v. C & G Holdings Ltd., Gardiner and Neville (1989), 78 Nfld. & P.E.I.R. 1; 244 A.P.R. 1 (Nfld. C.A.), refd to. [para. 95].

ADGA Systems International Ltd. v. Valcom Ltd. et al. (1999), 117 O.A.C. 39 (C.A.), refd to. [para. 97].

Demarco Agencies Ltd. v. Merlo (1987), 62 Nfld. & P.E.I.R. 248; 190 A.P.R. 248 (Nfld. C.A.), refd to. [para. 112].

Canadian Pacific Railway Co. v. Murray, [1932] S.C.R. 112, refd to. [para. 113].

Jones v. Great West Railway Co. (1930), 47 T.L.R. 39, refd to. [para. 113].

Caswell v. Powell Duffryn Associated Collieries Ltd., [1940] A.C. 152 (H.L.), refd to. [para. 114].

Lee v. Jacobson et al. (1994), 53 B.C.A.C. 75; 87 W.A.C. 75; 120 D.L.R.(4th) 155 (C.A.), refd to. [para. 115].

Kozak v. Funk; Kozak v. Nutter (1997), 158 Sask.R. 283; 153 W.A.C. 283 (C.A.), refd to. [para. 115].

Stevens v. Globe and Mail et al. (1996), 90 O.A.C. 361; 135 D.L.R.(4th) 240 (C.A.), refd to. [para. 118].

Sweet (George C.) Agencies Ltd. v. Sklar-Peppler Furniture Corp. (1995), 140 N.S.R.(2d) 69; 399 A.P.R. 69 (C.A.), refd to. [para. 118].

Janke v. Cenalta Oilwell Servicing Ltd. et al. (1997), 152 Sask.R. 32; 140 W.A.C. 32; 143 D.L.R.(4th) 613 (C.A.), folld. [para. 119].

Colt Engineering and Construction Ltd. v. Bond Architects & Engineers Ltd. et al. (1996), 140 Nfld. & P.E.I.R. 45; 438 A.P.R. 45 (Nfld. C.A.), refd to. [para. 121].

Janes v. Deer Lake (Town) (1993), 110 Nfld. & P.E.I.R. 202; 346 A.P.R. 202 (Nfld. C.A.), refd to. [para. 127].

Charcoal Pit Ltd. v. Atlantic Insurance Co. et al. (1994), 123 Nfld. & P.E.I.R. 255; 382 A.P.R. 255 (Nfld. C.A.), refd to. [para. 127].

House of Haynes (Restaurant) Ltd. et al. v. Snook et al. (1995), 134 Nfld. & P.E.I.R. 23; 417 A.P.R. 23 (Nfld. C.A.), refd to. [para. 127].

Canadian Paraplegic Association (New­foundland and Labrador) Inc. v. Sparcott Engineering Ltd. et al. (1997), 150 Nfld. & P.E.I.R. 203; 470 A.P.R. 203 (Nfld. C.A.), refd to. [para. 127].

Petten et al. v. E.Y.E. Marine Consultants et al. (1998), 179 Nfld. & P.E.I.R. 94; 546 A.P.R. 94 (Nfld. T.D.), refd to. [para. 127].

Perry v. Heywood et al. (1999), 175 Nfld. & P.E.I.R. 253; 537 A.P.R. 253 (Nfld. C.A.), refd to. [para. 127].

Young v. Young et al. (1993), 160 N.R. 1; 34 B.C.A.C. 161; 56 W.A.C. 161; 108 D.L.R.(4th) 193 (S.C.C.), refd to. [para. 128].

Statutes Noticed:

Judgment Interest Act, R.S.N. 1990, c. J-2, sect. 4(2) [para. 117].

Authors and Works Noticed:

Cross on Evidence (7th Ed. 1990), p. 452 [para. 88, footnote 25].

Harris, David, Wrongful Dismissal, ch. 4.57 [para. 118].

Levitt, Howard A., The Law of Dismissal in Canada (2nd Ed. 1992), pp. 376, 377 [para. 118].

Orkin, Mark M., The Law of Costs (2nd Ed. 1987), para. 801.5 [para. 121].

Sopinka, John, Lederman, Sydney N., and Bryant, Alan W., The Law of Evidence in Canada (1992), pp. 40 [para. 111]; 825 [para. 39, footnote 12]; 837, 838 [para. 29].

Counsel:

Augustine F. Bruce, for the appellant;

Harold Smith, for the first respondent;

James R. Chalker, Q.C., for the second respondent.

This appeal was heard on October 7 and 15, 1998, by Marshall, Cameron and Green, JJ.A., of the Newfoundland Court of Appeal. On May 10, 1999, Cameron, J.A., delivered the following judgment for the Court of Appeal.