Templeton v. RBC Dominion Securities Inc., (2005) 249 Nfld. & P.E.I.R. 170 (NLTD)

• Judge: Orsborn, J.
• Court: Supreme Court of Newfoundland and Labrador (Canada)
• Case Date: August 05, 2005
• Jurisdiction: Newfoundland and Labrador
• Citations: (2005), 249 Nfld. & P.E.I.R. 170 (NLTD)

Templeton v. RBC Dominion (2005), 249 Nfld. & P.E.I.R. 170 (NLTD);

    743 A.P.R. 170

MLB headnote and full text

Temp. Cite: [2005] Nfld. & P.E.I.R. TBEd. AU.009

Bruce Templeton (plaintiff) v. RBC Dominion Securities Inc. (defendant)

(200201T1649; 2005 NLTD 130)

Indexed As: Templeton v. RBC Dominion Securities Inc.

Newfoundland and Labrador Supreme Court

Trial Division

Orsborn, J.

August 5, 2005.

Summary:

An investment advisor sued his former employer for wrongful dismissal.

The Newfoundland and Labrador Supreme Court, Trial Division, dismissed the action and provisionally assessed damaged.

Editor's Note: Certain names in the following case have been initialized or the case otherwise edited to prevent the disclosure of identities where required by law, publication ban, Maritime Law Book's editorial policy or otherwise.

Master and Servant - Topic 1223

Contract of hiring (employment contract) - Termination - Resignation - The defendant in a wrongful dismissal action asserted that the plaintiff had resigned - The Newfoundland and Labrador Supreme Court, Trial Division stated that "The general rule is that an effective resignation must be voluntary; however, a reluctant resignation may nonetheless still be valid. ... A resignation brings about the termination of the employment relationship at the instance of the employee. To be effective the employee's act - the termination of the relationship - must be voluntary and not coerced. ... It is important to distinguish between a letter of resignation and resignation itself. A resignation is the decision to terminate the relationship or, equally, a fact or circumstance which unequivocally reflects that decision. A letter of resignation is simply evidence - usually cogent evidence - of the employee's decision to end the relationship. But it is no more than that; a letter of resignation is not, in and of itself, the employee's termination of the relationship." - See paragraphs 44 to 46.

Master and Servant - Topic 1223

Contract of hiring (employment contract) - Termination - Resignation - Templeton worked in the securities business as an investment advisor - Templeton's employer decided to terminate his employment because he had engaged in discretionary trading and trading that was beneficial to Templeton but contrary to his client's interest - The employer gave Templeton the option of resigning or being terminated for cause and advised him that it would be in his interests to resign if he was considering management in another firm - Templeton, after receiving advice, tendered his resignation - The following day, Templeton sent a "Happy Resignation Day" e-mail to a number of recipients advising them of his resignation - Templeton subsequently sued for wrongful dismissal - The Newfoundland and Labrador Supreme Court, Trial Division, rejected the employer's assertion that Templeton had resigned - The question to be asked was "who terminated the employment relationship?" - Templeton's termination was brought about solely by the employer - Templeton had a choice of whether to write the resignation letter, but not whether he would leave his employment - See paragraphs 37 to 49.

Master and Servant - Topic 7553

Dismissal of employees - Grounds - Misconduct or misconduct of business - Templeton worked in the securities business as an investment advisor - In December 2001 and January 2002, he engaged in bulk discretionary transactions - No clients complained - In January 2002, Templeton, also without authorization, sold a client's mutual funds which had the acquisition fee paid upfront - Templeton then purchased the identical mutual fund with a deferred sales charge - The transaction provided no financial benefit to the client, locked in her equity for several years and required her to pay a penalty if she liquidated the fund during that period - The transaction generated a commission for Templeton - The client complained - The employer reversed the transaction at Templeton's expense - The employer had previously disciplined Templeton for similar trading activity, gave him a written warning and advised him of the need for strict adherence to the trading rules - The Newfoundland and Labrador Supreme Court, Trial Division, dismissed Templeton's wrongful dismissal action - The employer had lost confidence in Templeton - The trading activity in question was inconsistent with the fundamental conditions of Templeton's employment and had prejudiced the proper conduct of the employer's business - See paragraphs 144 to 165.

Master and Servant - Topic 7582

Dismissal of employees - Grounds - Conduct incompatible with employer's interests - [See Master and Servant - Topic 7553 ].

Master and Servant - Topic 7614

Dismissal of employees - Defences - Resignation of employee - [See both Master and Servant - Topic 1223 ].

Master and Servant - Topic 7704

Dismissal of employees - Damages for wrongful dismissal - Measure of damages for wrongful dismissal - For 20 years, Templeton worked in the securities business as an investment advisor with the same employer - For the 10 years prior to 1997, he had been a branch manager - On March 7, 2002, the employer terminated his employment - After unsuccessfully attempting to find similar employment, Templeton became a co-owner of a new office for Berkshire Securities - The Newfoundland and Labrador Supreme Court, Trial Division, dismissed Templeton's wrongful dismissal action, but provisionally assessed damages - The court concluded that a reasonable notice period was 24 months - The court rejected the assertion that Templeton's income for the notice period should be based on his average commission for the four years prior to termination because his income had declined significantly and consistently from 1998 to 2000 (from $287,758 to $114,340) - The court concluded that Templeton would have earned in the vicinity of $325,000 during the notice period - From that amount the court added a net loss realized by Templeton's new business in 2002 ($34,867) and subtracted the income earned in 2003 and 2004 - The court stated that the $34,867 loss was attributable to start-up expenses and slow growth for that type of business and might be characterized as mitigation expenses - See paragraphs 166 to 182.

Master and Servant - Topic 7716

Dismissal of employees - Damages for wrongful dismissal - Deductions - Earnings during notice period - [See Master and Servant - Topic 7704 ].

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 8064

Dismissal without cause - Damages - Mitigation - [See Master and Servant - Topic 7704 ].

Master and Servant - Topic 8069

Dismissal without cause - Damages - Expenses seeking new employment - [See Master and Servant - Topic 7704 ].

Master and Servant - Topic 8797

Dismissal - Practice - Evidence - Relevancy - Templeton worked in the securities business as an investment advisor - Templeton's employer terminated him because he had engaged in improper trading - The Investment Dealers Association of Canada (IDA) subsequently conducted a review and concluded that Templeton had breached IDA's rules and imposed a written caution - Templeton sued for damages for wrongful dismissal - Templeton asserted that the court should not second guess the IDA and characterize his conduct as amounting to just cause - The Newfoundland and Labrador Supreme Court, Trial Division, stated that had the IDA, after hearing and considering all of the same evidence put before the court, concluded that the appropriate response was a written caution, that response could be properly considered by the court in deciding how to characterize the conduct in question - However, the IDA review was limited and its conclusion was of no assistance to the court - See paragraphs 159 and 160.

Cases Noticed:

Korman v. Midland Walwyn Capital Inc. (1999), 132 Man.R.(2d) 283 (Q.B.), refd to. [para. 39, footnote 2].

Head v. Ontario Provincial Police (Commissioner) (1981), 127 D.L.R.(3d) 366 (Ont. C.A.), refd to. [para. 40].

Gillingham v. Metropolitan Toronto Board of Commissioners of Police (1979), 101 D.L.R.(3d) 570 (Ont. Div. Ct.), refd to. [para. 42, footnote 3].

Kieran v. Ingram Micro Inc. (2004), 189 O.A.C. 58 (C.A.), refd to. [para. 43, footnote 4].

Denhamer v. RBC Dominion Securities Inc. (2000), 273 A.R. 159; 2000 ABQB 651, refd to. [para. 54, footnote 5].

Sparkes v. Enterprise Newfoundland and Labrador Corp. (1998), 167 Nfld. & P.E.I.R. 218; 513 A.P.R. 218 (Nfld. C.A.), refd to. [para. 146, footnote 8].

Thompson v. Boise Cascade Canada Ltd. (1994), 7 C.C.E.L.(2d) 17 (Ont. Gen. Div.), refd to. [para. 146, footnote 8].

McKinley v. BC Tel et al., [2001] 2 S.C.R. 161; 271 N.R. 16; 153 B.C.A.C. 161; 251 W.A.C. 161; 2001 SCC 38, refd to. [para. 148, footnote 9].

Ahmed v. RBC Dominion Securities Inc., [1998] B.C.T.C. Uned. A20 (S.C.), refd to. [para. 151, footnote 10].

Layden v. ScotiaMcLeod Inc. et al. (1997), 186 N.B.R.(2d) 241; 476 A.P.R. 241; 27 C.C.E.L.(2d) 87 (T.D.), refd to. [para. 151, footnote 10].

Marshall v. Prudential-Bache Securities Canada Ltd., [1995] O.J. No. 691 (Gen. Div.), refd to. [para. 151, footnote 10].

Musgrave v. Levesque Securities Inc. (2000), 183 N.S.R.(2d) 349; 568 A.P.R. 349; 50 C.C.E.L.(2d) 59 (S.C.), refd to. [para. 155, footnote 11].

Barakett v. Lévesque Beaubien Geoffrion Inc. (2001), 192 N.S.R.(2d) 114; 599 A.P.R. 114; 2001 NSSC 40, refd to. [para. 155, footnote 12].

Posluns v. Toronto Stock Exchange, [1964] 2 O.R. 547 (H.C.), dist. [para. 159, footnote 13].

Kaplan v. Canadian Institute of Actuaries (1994), 161 A.R. 321; 25 Alta. L.R.(3d) 108 (Q.B.), dist. [para. 159, footnote 13].

Mohr v. Vancouver, New Westminster & Fraser Valley District Council of Carpenters (1988), 32 B.C.L.R.(2d) 104 (C.A.), dist. [para. 159, footnote 13].

Ash v. Methodist Church (1901), 31 S.C.R. 497, dist. [para. 159, footnote 13].

Gill v. Canadian Venture Exchange Inc. et al. (2003), 185 B.C.A.C. 197; 303 W.A.C. 197; 2003 BCCA 431, dist. [para. 159, footnote 13].

Authors and Works Noticed:

Canadian Securities Institute, Conduct and Practices Handbook, p. 91 [para. 52].

Counsel:

V. Randell J. Earle, Q.C., for Bruce Templeton;

J. David B. Eaton, Q.C., and Stacey O'Dea for RBC Dominion Securities Inc.

This case was heard at St. John's, Newfoundland and Labrador, by Orsborn, J., of the Newfoundland and Labrador Supreme Court, Trial Division, who delivered the following decision on August 5, 2005.