The Basics

We reviewed in a recent post the fundamentals of a summary judgment motion. As was then noted, often both parties may agree that this process should be used where there are no significant facts in controversy. In employment cases, often the court on this motion will be asked to determine issues such as the notice period or legal issues dealing with the damage calculations or the legality of certain contractual provisions. Such a case was recently successfully advanced by the firm by Ms. M. Catherine Osborne and Mr. Justin Tetrault, on this occasion acting for the plaintiff employee.[1]

The issues to be decided in this case were:

1. The notice period;
2. The Impact of the employer’s Commission Plan which purported to reduce commission sums earned prior to termination;
3. The quantification of the monetary loss for the notice period, including the assessment of the value of lost commissions and stock options attributable to the notice period.

Issue 1 The Notice Period

It was clear that the plaintiff was entitled to a notice award in the upper range, given a senior position, 22 years of employment and a salary of $250,000 US funds and other substantial commission sums. The court found no reason to go beyond the sum of 24 months. The assessment of the notice period is a good example of the usefulness of the summary judgment process. Occasionally and not in this instance, counsel may ask the judge only for the determination of this issue and resolve the remaining issues themselves.

Issue 2 The Commission Plan

This document stated on its face that commissions earned and unpaid as of termination date would be paid at a rate of 50%. The total claim advanced was considerable, being $877,000 US.  The court interpreted the relevant document defining the employer’s argument as ambiguous, a death knell word to this plea as any such questioned interpretation is read against the creator of the document. The claim succeeded. Again, this is a good example of the utility of this process.

Issue 3 Adding up the Dollars

One of the main issues on this question was the method of defining the claim for lost commissions in the notice period. There were different possibilities to decide this issue, such using the previous three year average or the immediately prior year only. The evidence disclosed a straight line reduction in commissions on this issue. The question that the court strives to answer is what would the plaintiff likely have earned had he received this working notice. The average is more apt when the numbers bounce up and down. On this issue, the court accepted the defence submission and used the immediately prior year.

A second issue involved a claim for the loss of vesting rights of stock options in the notice period. The language of the stock option plan was found not to have denied this claim. It can be done with the proper language but here the document failed to do so.

Both these issues are again illustrative of the use of this summary process.

The Result

The motlon was a grand success for the plaintiff. The precise mathematics remain to be determined by both counsel.

Employers’ Lesson

In this case, the motion was brought at the initiative of the employee. The employer was prudent to agree to the use of the process, given that there were no substantive facts in controversy. Like every case involving documents purporting to define the rights of the plaintiff, the employer must give a cautious eye to the impact this may have on other employees governed by the same documents.

Employees’ View

This case is a good example of the use of this process to end the case with at minimum costs. Where there are no cause allegations and no real facts in dispute it is a good tool to consider. As noted previously, the motion also accelerates the time line which may precipitate settlement discussions.

Get Advice and Know Your Rights

Summary judgment is an effective process to end the dispute. Keep in mind that It may be initiated by either party. For advice on this issue from either side, contact the offices of Toronto employment lawyers Grosman Gale Fletcher Hopkins. We regularly advise workplace parties on a wide range of legal workplace issues. Contact us online or by phone at 416 364 9599 to schedule a consultation.

[1] O’Reilly v Imax