High-Handed Conduct (Tort)

OMJ Mortgage Capital Inc. v. King Square Ltd., 2020 ONSC 3922 (CanLII)

[4] Substantial indemnity costs may be warranted where a party has engaged in reprehensible, scandalous or outrageous conduct in the proceeding: Davies v. Clarington (Municipality) (2009), 100 O.R. (3d) 66 (C.A.), 2009 ONCA 722, at paras. 28-29. The Court of Appeal has repeatedly stated that substantial indemnity costs are reserved to those rare and exceptional case where a party has engaged in egregious or high-handed conduct warranting an expression of the court’s disapproval.

[5] While I found that KSL’s failure to disclose that it obtained further loans from the lender that OMJ had introduced breached the duty of good faith, a finding of bad faith does not necessarily warrant costs on a substantial indemnity basis. There was no egregious, malicious or high-handed conduct, in the proceeding or otherwise, that would warrant an award of substantial indemnity costs before the date of the offer to settle.

[6] OMJ’s costs until its offer to settle are to be determined on a partial indemnity basis.

Horner v. 897469 Ontario Inc., 2018 ONSC 121 (CanLII)

e. $20,000 in punitive damages for the callous and high-handed conduct of the defendant, including false allegations of misconduct and false allegations of termination for just cause

[28] The plaintiff alleges that the defendant allowed bullying, violence and harassment in the workplace and further that the plaintiff was terminated because she complained of the bullying, violence and harassment.

[29] In Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419 the court said:

[59] …Punitive damage awards are not compensatory. They are meant to punish the defendant in exceptional cases where the defendant’s conduct has been “malicious, oppressive and high-handed” and “represents a marked departure from the ordinary standards of decent behaviour”, see Whiten, at para. 36

[30] I am satisfied on the evidence that the plaintiff was harassed in the workplace and that the employer, rather than investigating, terminated the plaintiff. As such, I find that the employer’s conduct was malicious, oppressive and high-handed and must be deterred. Punitive damages are awarded only where compensatory damages are insufficient to deter. In this case, compensatory damages awarded were $10,000 for wrongful dismissal. I have also awarded aggravated damages of $20,000. In my opinion, these awards are insufficient to deter this conduct. I award $10,000 as punitive damages.

f. $20,000 in aggravated damages for the egregious manner in which the defendant terminated the plaintiff’s employment

[31] The plaintiff argues that the circumstances of her termination caused or contributed to her serious depression and therefore claims entitlement to aggravated damages.

[32] In Boucher v. Wal-Mart Canada Corp., 2014 ONCA 419 the court described aggravated damages in wrongful dismissal cases as follows:

[66] Aggravated damages are compensatory damages. They are part of breach of contract damages. They compensate a plaintiff for the additional harm suffered because of the way the contract was breached. In a wrongful dismissal claim, aggravated damages may be awarded against the employer where “the employer engages in conduct during the course of dismissal that is ‘unfair or is in bad faith’”: see Honda Canada Inc. v. Keays, 2008 SCC 39 (CanLII), [2008] 2 S.C.R. 362, at para. 57. However, “the normal distress and hurt feelings resulting from dismissal are not compensable.” see Honda, at para. 56.

[33] More recently, in Doyle v. Zochen Inc., 2017 ONCA 130 the court stated:

[12] Beginning with Wallace v. United Grain Growers Ltd., 1997 CanLII 332 (SCC), [1997] 3 S.C.R. 701, at para. 95, the Supreme Court of Canada recognized that there is an obligation of good faith in the manner of dismissal of an employee and, at paras. 88 and 98, specified that damages are available where an employer engages in conduct that is “unfair or is in bad faith by being, for example, untruthful, misleading or unduly insensitive.” Initially the award, now known as moral damages, involved compensation through an addition to the period of notice. However, in Keays v. Honda Canada Inc., 2008 SCC 39 (CanLII), [2008] 2 S.C.R. 362, at para. 59, the Court essentially did away with the distinction between aggravated damages and moral damages and held that these damages should be recognized through a fixed monetary award rather than through an extension of the notice period: see S.R. Ball, Canadian Employment Law, loose-leaf (2016), vol. 2 (Toronto: Thomson Reuters Canada Ltd., 2007), at § 22: 20.19 (1.1), p. 22-59 and § 22:20.19 (1.2), p. 22-60.

[34] In Doyle, the plaintiff, like the plaintiff here, was significantly impacted by the manner of the termination which the court described as “cold and brusque” having been previously told that her job was not in jeopardy (see para 18). The court described the impact as follows:

[11] …. She felt betrayed, abused, sad and upset. She was placed upon medication for anxiety as she had been shaking constantly. She had migraines, chest pains and sleep disturbances. A doctor at the Centre for Addiction and Mental Health (“CAMH”) recommended she be admitted to CAMH. Doyle declined but was placed under the care of a psychiatrist. She had significant sleep issues, including nightmares about Rogers’ harassment, and the workplace meeting of July 14. She was diagnosed as having a major depressive disorder, with anxiety.

[35] In this case, rather than “figuring this out in the new year” as he told the plaintiff he would, the employer immediately terminated the plaintiff’s employment without further discussion and delivered a termination letter during the Christmas holidays by sticking a letter in the back door. The manner of the termination was beyond “cold and brusque”; it was cowardly. The aftermath of the termination for the plaintiff has been discussed earlier.

[36] I am satisfied that the manner of termination did cause an aggravation of the plaintiff’s pre-existing depression and that this is an appropriate case for aggravated or “moral” damages. I award the plaintiff the sum of $20,000 for aggravated damages.