The Ontario Court of Appeal has released its concise decision in Brito v. Canac Kitchens, in which the court upheld a majority of the trial decision but quashed the award of punitive damages. For a detailed analysis of the original trial decision, please read our update.
Canac terminated the plaintiff’s employment after 24 years’ service, at the age of 55, and provided him only with his minimum employment standards entitlements to notice, severance and benefits continuation during the eight week statutory notice period. Canac had no contract with the plaintiff to limit his entitlements on termination to statutory minimums. The plaintiff was thus entitled under the common law to reasonable notice but had an obligation to make efforts to mitigate any damages for pay in lieu of reasonable notice in excess of his minimum statutory entitlements.
Ultimately at trial, the late Justice Echlin held that the plaintiff was entitled to 22 months reasonable notice at common law. Unfortunately, after Canac terminated the plaintiff’s benefit coverage, but before the end of that 22 month reasonable notice period, the plaintiff was diagnosed with cancer and was unable to work in light of his condition and related treatments. In addition to damages in lieu of reasonable notice, Justice Echlin awarded the plaintiff almost $50,000 for the present value of his lost LTD benefits to age 65 and $15,000 in “ancillary” damages for what he found as “cavalier, harsh, malicious, reckless, outrageous and high-handed conduct” on the part of Canac.
The Court of Appeal upheld the reasonable notice award and the award for lost benefits. The Court of Appeal rejected the employer’s argument that the plaintiff failed to mitigate, holding that “There can be no obligation to mitigate damages by finding alternate employment where the employee is totally incapable of working.”
Notably, the Court of Appeal quashed the award of “ancillary damages,” ruling the award was properly characterized as an award of punitive damages – something the plaintiff failed to plead or seek in his claim or at trial.
