Wednesday, December 16, 2015

Another Chapter in the Mehedi v. Job Success Saga

More than a year ago, I posted about the case of Mehedi v. 2052761, involving an individual suing a company called "Job Success" for fraud - basically alleging that he paid them a lot of money for them to find a job, with guaranteed results which never materialized.

A brief overview of the procedural background:  It went to trial in 2011, and the judge accepted the defence evidence that there were no specific guarantees made.  Mehedi appealed, and in January 2012 the appeal was dismissed.  In February 2012, CBC ran a "Marketplace" segment about a related company to Job Success, going undercover with hidden cameras, and caught the same people who testified in the 2011 trial making exactly the kinds of guarantees which they had testified they don't make.

Ever call a telecom company and end up getting bounced from department to department, repeatedly, sometimes back to one you've already talked to, having to wait on hold for hours each time?  Imagine that you're on hold for months, and that's basically what happened next to Mehedi.

Self-represented, he brought a motion for judgment in March 2012.  This was the wrong move; the motion judge concluded that he needed to have the trial judgment set aside first, and suggested he obtain legal advice.  He obtained legal advice recommending that he try to file a motion to lead new evidence before the same trial judge, so he wrote to the judge.  He then received a letter advising that it was inappropriate to communicate with the judge directly, directing him to schedule the motion through the Court Registry.  The scheduling office told him that they didn't know the specific judges' schedules, and suggested that he obtain dates directly from the trial judge's office.  He went back to a lawyer at this point, who contacted the trial judge's assistant in late November 2012 to obtain dates - but unfortunately the trial judge was not sitting in civil court in the foreseeable future.  The assistant suggested bringing a motion to the Superior Court (before a judge to be assigned) to introduce new evidence.

So Mehedi brought a motion in March 2013, which was adjourned twice, eventually being heard in May 2014.  The Superior Court's answer?  Because the matter had gone to the Court of Appeal, the motion should be made at the Court of Appeal level.

So Mehedi followed that direction, and brought a similar motion at the Court of Appeal - heard in July 2014.  The Court's conclusion:  "Regretting the inconvenience Mr. Mehedi has encountered, I conclude that his motion to introduce new evidence should be brought in the Superior Court before a motions judge in the ordinary way."  Again.

The new development is that Mr. Mehedi brought his motion, which was heard by Justice Whitaker in November 2014.  Justice Whitaker dismissed the motion with very brief reasons, finding that he wasn't convinced that the new evidence would have made a difference in the overall disposition of the case.

So...back to the Court of Appeal, which released a new decision in October 2015, allowing the appeal.

While there's some interesting (from a lawyer's perspective) discussion of the appropriate test, the Court of Appeal was of the view that the test was satisfied either way (and that Justice Whitaker's reasons on the issue were not adequate).  The Court of Appeal re-opened the trial and remitted the matter back to the trial judge for consideration of the admissibility and impact of the new evidence.


Reopening a trial after a decision has been rendered is highly exceptional:  There's a significant interest in finality, so the courts don't do it lightly.

But this factual situation is very unusual.

On the appeal, there was some debate as to the appropriate test to be applied.  It looks, though, like the Court downplayed the differences between the tests.

The Baetz test looks at whether the new evidence could reasonably have been obtained for trial, along with various other factors such as whether or not the moving party delayed in bringing the motion and the overall fairness to the parties and those who have acted in reliance on the judgment, in the circumstances.

The Sagaz test is often formulated with two questions:
(1)  Could the evidence have reasonably been obtained for use at trial?
(2)  Could the evidence reasonably have affected the outcome of the trial?

However, there are other comments in the Sagaz decision which allude to general fairness principles, as well as specific concerns about reliability of the evidence.  The Court of Appeal appears to question how much of a difference there really is between the two tests at all.

And, either way, it does indeed seem that the test is made out:  The new evidence was released by a third party after the hearing of the appeal, so it certainly wasn't available to Mehedi.  It certainly could have affected the outcome of the trial, which hinged in large part on the trial judge regarding it as "unrealistic and unreasonable" that the defendants might have made the promises which they were alleged to make; the trial judge would have had cause to rethink that conclusion if he saw this video evidence of them making similar representations to others.

And in terms of the general fairness issues, the delays were not Mehedi's fault; he began seeking this relief immediately when the evidence became available, and a very short period of time after the original appeal.

Interestingly, the Court of Appeal referred to the Irving Shipbuilding Inc. v. Schmidt case (where the employer improperly obtained an Anton Pillar Order against an employee, and proceeded to ransack the employee's home) as a precedent for the test.  If you'll recall my commentary on the motion to introduce fresh evidence in Schmidt, I referred to the Mehedi fact pattern as an "excellent example" of a case where the evidence couldn't have been available at the hearing.

Lessons Learned

I have a great deal of sympathy for the ordeal that the system put Mr. Mehedi through.  It's hard to excuse the different courts disagreeing as to the correct procedure; with increasing numbers of self-represented litigants trying to access the legal process, it's hard to excuse a process so complicated that the courts themselves can't parse it.

That being said, it may have been much smoother had Mr. Mehedi had the assistance of counsel throughout.  More thorough legal submissions to Justice Whitaker may have made a difference, eliminating the need for this appeal.  A lawyer might have been better-positioned to convince the Superior Court, on the first attempt at the motion, that it had jurisdiction to hear the motion notwithstanding the earlier appeal.  (Whenever you're seeking unusual relief at court, you're likely to hear the question, "Where do I draw the jurisdiction to grant the relief you're seeking?"  If you can't answer that question - and sometimes it's a very legally sophisticated question - then you're in trouble.)

Better advice, earlier, would certainly have prevented him from bringing the doomed motion for judgment without first moving to admit the new evidence.

There are times when lawyers and judges can legitimately disagree amongst themselves as to how an issue should move forward.  If lawyers always agreed on everything, we wouldn't need judges.  If judges always agreed on everything, we wouldn't need appeals.  As a lawyer, sometimes I have to make a decision on process, and then I have to defend that choice.  In the absence of a cogent justification for a procedural decision, it's easier for an adjudicator to say "You chose...poorly" and dismiss the proceeding than it is for the adjudicator to find a way to grant the relief.

Consider my recent post about Finney v. Cepovski, where the Landlord Tenant Board said (to paraphrase) "We can't award damages for utilities", so the landlord went to the Small Claims Court instead, which said "They were wrong; that process was the right one, and so the court can't help you."  At the LTB, I would have strenuously argued about jurisdiction, and may well have caused the adjudicator to think twice about declining to award damages.  Coming out of the unsuccessful LTB hearing, I would have suggested judicial review at the Divisional Court instead of a Small Claims Court action (which would have been the better avenue).  But even at the Small Claims Court, I'd have had arguments up my sleeve to try to convince the Deputy Judge to take jurisdiction anyways.

Sometimes, even with a lawyer, you still get locked out.  But it's less likely.  You're more likely to choose an available course of action in the first place with good legal advice, and more likely to be able to convince the applicable adjudicator that, in fact, the course you have chosen is the correct one.


This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

The author is a lawyer practicing in Newmarket, primarily in the areas of labour and employment law and civil litigation.  If you need legal assistance, please contact him for information on available services and billing.

Tuesday, December 15, 2015

Long-Service Employee Signs Fixed Term Contract - And Regrets It

Brent Riskie worked for Sony Canada since 1989 - he was presumably around 19 or 20 when he started.  As of earlier this year, he had a Toronto-based management position.

Last year, he wanted to move to Ottawa for family reasons, and asked the employer to accommodate such a move, that he would largely work from his new home and travel to Toronto on an as-needed basis.

The employer was reluctant.  Riskie, and his immediate supervisor, pressed the matter.  Eventually, Sony agreed to do so, but only on a trial basis, and insisted that he sign a fixed-term contract in order to do so.  While negotiations were still ongoing, he completed his move.  The contract was signed July 28, 2014, with an expiration date of March 31, 2015.

His department went through a restructure in early 2015, and on February 18, 2015, he was advised that his contract would not be renewed.  He received statutory minimum notice and severance payments - approximately 7 months.

It sounds like he likely would have been restructured out regardless of the move, and probably would have been entitled to somewhere close to two years of pay in lieu of notice.  Instead...

Recently, Justice Dunphy upheld the fixed term contract, and denied him further recovery.

The Issues

The problem was obvious:  The employer was ostensibly entitled to just...not renew the contract.  So Riskie had to find a way around that, argue that the fixed term provision was of no force and effect.

To that end, he made a few arguments.  One was 'duress' - the framework is interesting, but this doesn't look like a close case for it.  The fact that he might have felt obligated by his personal circumstances to move and accept whatever terms were put to him...doesn't affect Sony's entitlement to insist on those terms.

Two other arguments were stronger, though.  One was that the contract was unenforceable for lack of consideration, and the other was an ESA compliance issue.

Lack of Consideration

As I've noted many times before on this blog, an employment contract needs to give an employee something 'new'.  If you hire me, and then ask me to sign a contract after you've hired me, then the question is 'what am I getting out of this contract that I don't already have'?  In the absence of 'fresh consideration', the contract fails the test for enforceable promises at common law.

So the interesting quirk here is that he actually moved before the new contract was signed.  So it looks an awful lot like the 'fresh consideration' cases:  He's doing the job from Ottawa, and now he's signing a contract which...ahem...entitles him to work from Ottawa.

It's a compelling argument, at face value.

On the other hand, there's a very strong moral argument going the other way:  He knew, when he made the move, that he was going to be required to sign such a contract, and that the employer wasn't acquiescing to the move without terms on it.

Justice Dunphy focuses on that, and characterizes the 'fresh consideration' argument as "a technical argument devoid from any real-world substance".  (That's true of a lot of consideration-based arguments.  It's a very technical legal concept.)

At law, it is a fairly straightforward reality that none of that actually matters, if the employer actually did acquiesce to his terms and allow him to move notwithstanding the absence of a signed contract.

The saving grace in Justice Dunphy's reasoning on the point is this:  "it was a case of “take it or return to Toronto”".

It there's the evidence to substantiate that understanding, that Sony permitting him to work from Ottawa while negotiations were ongoing was without prejudice, and that they reserved the right to recall him to Toronto if negotiations failed, then Justice Dunphy's conclusion is right.  And I don't know what evidence was before the court - but I don't think that you can take such a reservation as implied from the fact of ongoing negotiations.

ESA Compliance

Here's another interesting one.  There's an early termination clause in the language of the contract, in the same paragraph setting out the term of the agreement, allowing the employer to terminate it on 30 days' notice.

On its face, that was deeply problematic:  A termination clause cannot contract out of the statutory minimums, and for a 26 year employee, there's a minimum notice period of 8 weeks.  (Not to mention statutory severance.)  So this early termination clause was clearly void.

This raises the question of 'severability' - when the court finds that a given provision is void by operation of law, how does that affect the rest of the contract?

There's a conceptual challenge with writing out a small part of a contract:  A contract is agreed to between the parties as a whole.  It has long been said that a court will not rewrite a contract between the parties.

On the other hand, it's fairly compelling to remove the illegal portions of a contract and leave in place the legal portions.

There have been a variety of legal doctrines employed to resolve this tension, which are either limited or controversial.  The "blue pencil" approach has often been used to determine whether or not it is possible to sever language, and how to do so:  Can a fair and coherent contract be left between the parties merely by striking out the problematic language?  By contrast, there's 'notional severance', which allows the court to controversially insert language in order to remove the illegal effect from the contract.

I've very seldom seen the 'blue pencil' approach openly discussed in employment law cases:  It is clear from the seminal Machtinger case from the Supreme Court of Canada that, at minimum, an unenforceable termination clause must be struck in its entirety.  It is incumbent upon an employer to ensure the legality of its contractual language, and the employer cannot turn to the courts to try to fix the contract after the fact.

And the question seldom arises as to how far beyond that unenforceable language we need to do.  Where it has arisen, the cases sometimes involve clear 'severability clauses' guiding the court's interpretation.  For example, in the recent decision in Miller v. Convergys CMG Canada Limited Partnership, the British Columbia Court of Appeal enforced a severability clause which spelled out that the different numbered paragraphs in the agreement were separate promises, and if one was unenforceable, the rest should be left intact.

In the absence of a clear severability clause, the question can be much more difficult.  But it seems to me fairly unusual to do what Justice Dunphy did with Mr. Riskie's contract, striking out the 'early termination' language while leaving the rest of the same paragraph intact.  Was it a separate promise?  Consider for a moment that, had the same severability language from Miller been present in this contract, it would have clearly required the whole paragraph to be struck.

Also consider that a fixed-term contract without an early termination clause can be exceedingly onerous for the parties.  In general terms, and in the context of a 26-year relationship, there are compelling reasons to think that one might have to read a 'fixed term' promise together with a corresponding 'early termination' promise.

Nonetheless, Justice Dunphy regarded them as being "logically and textually independent of each other", and found that they "are not a package that must stand or fall together."  Accordingly, despite the flaws in the early termination language, the fixed term was enforceable.

Lessons to be Learned

There are some very interesting legal issues in this case, dealing with severability and consideration, but the more significant issue is likely practical:  Be careful what you sign.

It's possible that the relocation to Ottawa was so important to Riskie that he would have done it even knowing the consequences.  Maybe he even sought legal advice on the terms, and no doubt would have been advised (a) that the early termination clause was probably not enforceable but (b) that changing from an indefinite-term contract to a fixed-term contract could have an immense impact on his existing rights upon termination.

What Riskie probably didn't anticipate was a restructure unrelated to his own circumstances.  Likely, he was confident that Sony would see that the new arrangement was viable, and that he would be able to continue to carry out his duties effectively.  "I'm not worried about getting fired, because I'm a great employee."  But when a restructure occurred for other reasons, his circumstances - and his contract - put him squarely in the line of fire.

This is why and how I encourage pushback on clauses limiting termination entitlements, particularly for employees in senior roles:  It's not about trying to get that golden parachute; it's about job security, making the employer think twice before deciding to get rid of you as a cost-cutting measure.


This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

The author is a lawyer practicing in Newmarket, primarily in the areas of labour and employment law and civil litigation.  If you need legal assistance, please contact him for information on available services and billing.

Wednesday, December 2, 2015

Using a Cell Phone in a Drive Through

There's a recent news story about a fellow who received a nearly $300 ticket for texting while in line at a Tim Hortons drive-through.

It's important to note that this took place in Beaumont, Alberta.  This is relevant.  While most traffic offences generally apply only to 'highways', Alberta's Traffic Safety Act expressly defines 'highways' as including private property like drive-throughs and parking lots generally used by the public.  Ontario's Highway Traffic Act does not, and the courts have consistently held that such properties are not 'highways'.  (Don't get fooled by the language, though.  We may casually use the term 'highway' as being distinct from 'city streets', but city streets are definitely highways within the definition of the HTA.)

So that wouldn't happen here in Ontario.

But it's not all that different from the 'texting at a red light' scenario.  Or, as the case may be, retrieving your phone from the floor at a red light.  Any use or handling of an electronic device, at any time you're on the road (unless legally parked), is an offence.  And it's an offence with a hefty fine.  A set fine of $490, with a maximum fine of $1000, plus three demerit points.  In terms of demerits, that's about on par with driving on the wrong side of the road.

There's a good reason to treat distracted driving so seriously:  It is a deadly problem on our roads.

But, perhaps, less so at red lights or in Tim Hortons drive-throughs.

I argue that the existing legislation is, in different respects, both overbroad and underinclusive.

The Legislation is Overbroad

This is an easy argument to make.  The law is premised on safety - steep penalties to discourage people from engaging in mortally dangerous behaviour.

Yet so many of the charges are laid in connection with cell phone use at red lights.

This is, in some ways, a practical enforcement issue:  It's easier to identify people using cell phones when they're stationary.  But part of that is because people are justifiably less concerned about the safe operation of their vehicle when they're stopped at a red light, and will be more likely to stare down at their phone for several seconds.  (Driving instructors will tell you that this is still unsafe:  Even when stopped at a red light, you need to be cognizant of your surroundings, to be prepared to respond to hazards that arise against you.  Part of defensive driving.  But that's really not what we're talking about when discussing the deadly hazards of distracted driving.  Driving defensively can certainly save lives, but it's rather disingenuous to ever attribute a fatality to a failure to drive defensively.)

So the message the law sends is "Just put away the phone."  This, on its face, doesn't seem so unreasonable - almost elegant in its simplicity.  Yet it isn't limited to telecommunications functions, either.  Changing the track on your iPod while stopped at a red light is an offence - and not just a minor offence, but a $490-$1000 fine.  Arguably, this takes less attention than changing the radio station on a built-in stereo - which will generally be legal.

I understand and agree with the need to seriously address the issue of distracted driving, because it's a safety issue.  But, frankly, somebody momentarily using a phone at a red light is simply not a safety issue in the same way, and imposing the same hefty fines to the person changing the song on their iPod at a red light, as to the person sending an email on the 401, makes no sense to me.

That being said, if somebody is holding up traffic because they haven't noticed that the light is green, there probably are (or should be) other lesser charges to cover that scenario.  I also wouldn't necessarily object to a lower 'distracted driving' offence covering red light scenarios; my argument is ultimately that it's rather absurd to treat all 'distracted driving' scenarios the same way.

The Legislation Fails to Address Actual Distractions

Earlier this year, York Regional Police kicked off a 'no cellphone pledge' campaign with a press conference, where the Regional Chairperson indicated that, on his way to the conference, he saw "four people talking on their hand-held cell phones, a woman putting on makeup, a man tying his tie, and numerous drivers juggling their breakfasts."

Distracted driving is dangerous.  Nobody disputes that.  Yet we've imposed a serious fine for holding a cell phone in your hand, while not directly addressing other common distractions at all.  Tying your tie?  Applying makeup?  Shaving?  Eating?  Drinking?  Smoking?  Reading?  I recall an occasion taking the GO bus downtown, and looking over into the vehicle next to us on the Gardiner and seeing a woman engrossed in a report she was reading.  While driving.  I wasn't so surprised when Rob Ford was caught doing the same thing.

Fundamentally, we have a major problem of people not giving driving the attention it deserves and requires.  It's far bigger than just cell phones.

And far bigger than hand-held cell phones, particularly.

There are plenty of statistics to support the proposition that talking on your cell phone significantly increases the odds of a serious collision.  And the existing research suggests that it is basically irrelevant whether or not you're on hands free.  The distraction of a phone conversation while driving isn't the result of the phone in your hand; it's the mental effort you're putting into the conversation that you should be putting into driving.

I'll admit that I make 'hands-free' calls in my car from time to time.  I don't generally like to do so, mainly because I find I'm a terrible conversationalist while doing so.  When the road calls for my attention, I pay attention to the road, and often lose my train of thought or miss what the other person is saying.  It's a matter of prioritization, which it seems many people don't do.  (It has also struck me, too, that there's a big difference between calling somebody to give an ETA in good driving conditions, as opposed to carrying on a heated argument during a blizzard.  There are gradations of distractions.)

There's a problem on the road, yes.  But the existing legislative regimes focus too much on what the hands are doing and too little on what the brain is doing - by obsessing about handsets and not caring at all about actual mental distractions.

And I think we can all agree that ticketing somebody in a Tim Hortons' drive through does not even come close to addressing the dangers posed by distracted driving.


This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

The author is a lawyer practicing in Newmarket, primarily in the areas of labour and employment law and civil litigation.  If you need legal assistance, please contact him for information on available services and billing.