Ontario Court of Appeal Upholds 11 Day Trial Awards Plaintiff’s Costs of $546,684:

In what what must be one of the largest award of costs in a wrongful dismissal actions Justice Chiappetta in Ruston v Keddco ( 2018 ONSC 5022) awarded the plaintiff full indemnity costs of this extraordinary amount. The trial judgement was for $604,627, of which $125,000 was for extraordinary damages.

On February 7, 2019 the Ontario Court of Appeal upheld both the decision on the merits and the appeal from the order for costs . The Plaintiff Respondent was also awarded $35,000 for costs of the appeal.

In simple terms the total  cost award was $591,684.

This was the Trial Judges reasoning :

(1) The costs requested are proportionate to the result. $700,000 was in dispute for the plaintiff’s claim plus $1,750,000 in the conter-claim. Out of a total of $2,450,000 in dispute, the plaintiff was successful on $2,354,628.00, calculated as the amount won, plus the entire value of the conter-claim which was dismissed in its entirely.

(2) The defendant pursued unfounded allegations of fraud. This was a matter of utmost importance to the plaintiff. Both his financial and professional future were at risk if the allegations were proven in court.

(3) It was the defendant’s conduct that contributed to the plaintiff’s costs. The plaintiff’s costs can be said to be what a reasonable party would expect to spend upon pursuing litigation against a party who engaged in conduct like that of the defendant. The defendant refused to admit facts but failed to contest them at trial. The defendant only provided relevant financial documents after the plaintiff brought a motion. The defendant provided will say statements 14 days in advance of the trial and not 30 days in advance as ordered. The defendant relied on only 45 of the 163 documents it produced on the first day of trial. The defendant caused an adjournment of the first trial less than six weeks before the date scheduled due to the introduction of a 25 person witness list. This led to a one year delay, double preparation and the requirement to have a second pre-trial. The defendant called only two fact witnesses at trial. By this conduct, the defendant caused the plaintiff to incur far greater costs than expected, substantially increasing the costs of trial preparation and the length of trial.

(4) The counter-claim rendered this action much more complex than a simple case of wrongful dismissal. Because of the fraud accusations the plaintiff had to hire an expert witness costing approximately $30,000. 

(5) The defendant threatened the plaintiff with expensive litigation if he pursued his wrongful dismissal matter and then proceeded to follow through on the threat. The plaintiff would have been denied access to justice had his lawyers not agreed to defer their fees. The plaintiff survived financially by relying on his RRSP’s, selling his house below market value and breaking his car lease.

(6) The use of two counsel at trial was reasonable for this case, considering the complexity of the counter-claim and the serious consequences to the plaintiff if he was unsuccessful in defending the counter-claim. Having adjudicated the trial, I observed that the work done during the trial by both counsel was different.

(7) The amounts claimed by the plaintiff to prepare the trial record were reasonable as the plaintiff had to determine if it was appropriate to set the matter down for trial. This requires a detailed documentary review to ensure full disclosure and that there will be no need for further motions.

(8) Having reviewed the costs outline submitted by the plaintiff, I have concluded that the time spent for various steps in the litigation is reasonable. It cannot be compared to the costs outline submitted by the defendant which is not certified. Further, my observation at trial was that plaintiff’s counsel was well prepared for trial while the defendant’s counsel was comparatively unprepared in that he arrived late or not at all in one instance, could not advise the court of the sequence and timing of his witnesses, failed to effectively use his book of documents and delivered materials at the last minute. The plaintiff’s costs outline is reflected of more time spent than the defendant in preparing for trial. This difference was demonstrated at trial to the detriment of the defendant’s counsel.

(9) The plaintiff was awarded both punitive and moral damages. The costs awarded herein are done so to indemnify the plaintiff, as the successful litigant, for the costs of litigation. Any references to the defendant’s conduct are meant to explain why the plaintiff’s costs are higher than one would reasonably expect from litigating a simple claim for wrongful dismissal and in no way reflect an overlap of the punitive or moral damages awarded.

That is what happens when the Judge hates what your client and/or lawyer has done.

Compare that with Justice Arrell in Wickens v Chambers Insurance Professionals ( 2018 ONSC 2412). In a three day wrongful dismissal trial in which the judge commented on the co-operation of counsel and their conduct of the trial in a ” most efficient manner ” he awarded the winning defendant costs of only $18,000.

Acting like a jerk cost the loser in Keddco the sum of $49,698 per day of trial.

Acting like a mensch cost the loser in Wickens only $6,000 per day of trial

Plaintiff’s counsel in Rushton  was Andrew Monkhouse and Samantha Lucifora of Monkhouse Law.

Once Resignation Accepted by Employer , Employee Cannot Resile :

In English v Manulife Financial Corp ( 2018 ONSC 5135 ) Edwards J. had a situation where an employee gave her employer 4 months notice of her resignation because she did not want to be involved in an upcoming computer conversion that was planned. The Employer accepted her resignation and started to make plans to redistribute her work. About a month later the employer changed their mind and cancelled the computer conversion. Since this was the basis for the employees’ decision to resign, upon hearing this news, she told her employer that she was withdrawing her resignation notice. The employer waited about a month later to say that they were not accepting her withdrawal and said that she would be expected to leave on the date she originally set.

The Court held that where a resignation is clear and unequivocal , as soon as it is accepted by the employer, then it cannot be withdrawn. Only where the employer has not accepted the resignation and has not detrimentally changed their position ( for example by hiring a replacement ) can the employee withdraw the resignation. In simple contract terms, the resignation is offered and then  accepted and thus a contract is formed.

Quere: Where the entire basis of the plaintiff’s resignation was the upcoming computer conversion, which was then cancelled by the employer, can it truly be said that her resignation was unequivocal ?

Would it not be fairer to say that her resignation was conditional on the computer conversion going ahead, and when that precondition changed , she was free to withdraw her resignation ?

What if the situation was reversed. The Employer announces a layoff four months in the future and then a month later changes their mind and cancels the layoff . If an employee tried to say that the layoff could not be cancelled and demanded their full common law notice, surely the employer would argue that if the employee refused to work after the original layoff date that action would constitute either a quit or at least  a complete failure to mitigate their damages.



I am pleased to announce that the Ontario Court of Appeal has now overturned this decision ( 2019 ONCA 612 ) . This what they said:

[20]       The motion judge concluded that the appellant’s September 22, 2016 letter constituted a “clear and unequivocal” resignation.

[21]       As I will explain, this was an error. Her resignation notice was equivocal given the circumstances in which she presented it to Manulife, and she was entitled to withdraw it.

[22]       When the appellant gave Mr. Ramnath her retirement letter, she told him that she was not entirely sure she wanted to retire. The impetus for her letter was the computer conversion. She was told by Mr. Ramnath that she could change her mind. Mr. Ramnath admitted this under oath. Within three weeks the computer conversion was cancelled. The day after the cancellation was announced, the appellant told Mr. Ramnath that she had changed her mind. He did not indicate that there was a problem with this.

[23]       These facts do not support a clear and unequivocal resignation. On the contrary, they demonstrate that the appellant was equivocal when giving her resignation notice, and that her equivocation was condoned by Manulife through the actions of Mr. Ramnath.

[24]       When Manulife cancelled the computer conversion within three weeks of her September 22, 2016 conversation with Mr. Ramnath, the basis for the appellant’s resignation disappeared. The appellant moved promptly to tell him that, as discussed, she was not going to retire. Mr. Ramnath acknowledged her decision and did not tell her it was a problem.

[25]       Manulife is bound by Mr. Ramnath’s promise to the appellant that she could change her mind. She did so within three weeks and her change of mind was not challenged.

[26]       Since the appellant did not in fact resign, her termination on December 12, 2016 was a wrongful dismissal.