Date: 20040206
Docket: T-2100-01
OTTAWA, ONTARIO, THIS 6th DAY OF FEBRUARY, 2004
PRESENT: THE HONOURABLE MR. JUSTICE MARTINEAU
BETWEEN:
RICHARD HOWARD KLASSEN
Plaintiff
- and -
HER MAJESTY THE QUEEN
Defendant
REASONS FOR JUDGMENT AND JUDGMENT
[1] The plaintiff brings this action for damages seeking compensation arising from the loss of his office as a commissioner of the Canadian Wheat Board (the Board).
BACKGROUND
[2] On September 14, 1988, the plaintiff was appointed commissioner of the Board. This was a full time position. The terms and conditions of the plaintiff's appointment as a commissioner were contained in:
(a) the Canadian Wheat Board Act, R.S.C. 1985, c. C-24 (the Act), together with other applicable statutes;
(b) a document entitled "Terms and Conditions Applicable to Current Chief Commissioner and Commissioners of the Canadian Wheat Board (Appointed prior to December 31, 1994)" (the Terms); and
(c) the Conflict of Interest and Post-Employment Code for Public Office Holders (the Code).
[3] Pursuant to subsection 3(3) of the Act, as it read before the coming into force of section 3 of An Act to amend the Canadian Wheat Board Act and to make consequential amendments to other Acts, S.C. 1998, c. 17 (the Amending Act), the plaintiff was entitled to hold office "during good behaviour" subject to removal "for cause" at any time by the Governor in Council. The latter provision further prescribed that "no commissioner shall hold office after attaining the age of seventy years".
[4] Pursuant to section 33 of the Amending Act, the offices of commissioners were abolished due to legislative restructuring of the Board. The appointments of every commissioner, including the plaintiff who was then 57 years old, were terminated on December 31,1998.
[5] At the date of termination, the plaintiff's gross annual salary was approximately $141,100.00. When all taxable employment benefits are added to this sum, his total employment income was $186,996.00 in 1998. This income included the taxable cost of excess life insurance provided by his employer and the taxable benefit associated with an automobile also supplied by his employer. On December 29, 1998, the plaintiff was paid a total of $352,079.36 before deductions. This payment included inter alia, a sum of $282,200.00 purporting to be a "Loss of Office Payment" (LOP), equivalent to two years' salary, pursuant to the Terms as acknowledged in the release signed by the plaintiff.
[6] In January 2000, the plaintiff accepted an offer of employment with the Saskatchewan Wheat Pool. The plaintiff's starting salary was approximately $225,000.00 and was later increased to $247,385.00. Unfortunately, a strategic decision was made in 2001 by the Saskatchewan Wheat Pool to sell all of the companies in the food sector industrial group, where the plaintiff was working. However, when his employment with the Saskatchewan Wheat Board was terminated on June 28, 2001, the plaintiff accepted a one-year contract with Saskatchewan Wheat Pool with an income of $10,000 per month. This contractual position ended on June 30, 2002 and was not renewed.
[7] On November 28, 2001, the plaintiff brought this action, claiming damages for breach of contract by the Crown. According to the report prepared by Mercer Human Resource Consulting dated November 14, 2003 (actuarial report) (exhibit P-9), the actuarial value of basic loss of earnings and pension was valued at $1,352,192 as of December 1, 2003. No allowance has been made for residual earnings from any future employment. Furthermore, this amount does not take into account both the sum of $282,200.00 already paid to the plaintiff, and the sums he received from the Saskatchewan Wheat Pool from 2000 to 2002. In addition to the sum mentioned above, the plaintiff claims an additional amount of $624,691.00 as set out in the appendix to the actuarial report. This sum is to cover the loss of "fringe benefits" (automobile, vacation, retirement allowance, country club membership, employee assistance, air mileage and airport lounge privileges).
ISSUES TO BE DETERMINED
[8] There has been no allegation that the plaintiff was terminated for cause. The issues to be determined by the Court, as agreed by the parties, are:
(a) What was the nature of the defendant's obligation to the plaintiff upon abolition of his office?
(b) If the defendant had an obligation, was that obligation discharged by the LOP of $282,200.00?
(c) If the plaintiff is entitled to further compensation, what, if any, is the entitlement?
POSITIONS TAKEN BY THE PARTIES
[9] The plaintiff submits that the nature of the defendant's obligation is essentially contractual and that under his contract of employment, he was entitled to work, during good behaviour, until the age of 70. The plaintiff acknowledges the defendant's right to restructure the Board and, in effect, to "legislate him out of employment". However, the plaintiff submits that this right is not accompanied by a right to avoid liability for breach of contract. The plaintiff now asks to be compensated for all damages flowing from his premature termination, including all salary and benefits to which he would have been entitled if he had worked until the age of 70.
[10] The defendant submits that the Terms specifically addressed the compensation owing to the plaintiff should he retire, resign or should the office to which the plaintiff was appointed be terminated. According to the defendant, the Terms provided for payment of compensation equivalent to two years' salary, together with ancillary compensation payable at termination. The defendant argues that upon termination of the plaintiff's office, and in accordance with the express terms and conditions of his employment, the plaintiff received and accepted compensation in full satisfaction of his loss of office. In other words, the defendant relies on the fact that the plaintiff was paid the LOP of $282,200.00 upon termination, and for which a release was executed on December 29, 1998.
[11] In contrast, the plaintiff submits that he has not received any compensation for the termination of his office. The plaintiff argues that the release in question was signed under duress. It was not intended to be a release from any other potential entitlement he may have, including his entitlement to salary and benefits until the age of 70. In his view, the release was drafted as an acknowledgement of an agreement not to compete with the defendant for a period of two years. As such, the LOP would have been payable to him in any event had he retired at the age of 70 years, resigned after 3 years of service, or been terminated. The plaintiff, therefore, submits that the LOP of $282,200.00 is payable to him in addition to, not in lieu of, general damages for breach of contract.
[12] In the event that this Court finds that the plaintiff is entitled to further compensation, alternatively, the defendant argues the plaintiff failed to mitigate those damages in whole or in part. Further, the plaintiff cannot be compensated for losing benefits that were not provided for in the Terms (such as air miles and airport lounge privileges) or that were not provided primarily for the plaintiff's private use (such as a club membership and a company car).
ANALYSIS
[13] The first issue to be determined is whether the defendant has an obligation towards the plaintiff. If so, this Court must then determine the nature of this obligation. In the event that this Court finds that there is a contractual obligation, then it must determine whether this obligation has been properly discharged, and as the case may be, whether further compensation should be allowed to the plaintiff.
[14] Traditionally, the Crown's relationship with its servants was not characterized as contractual (Reilly v. The King, [1934] 1 D.L.R. 434). The Crown appointed individuals to positions which they fulfilled until the Crown directed that they be dismissed. In other words, the appointments were unilateral and subject to arbitrary dismissal. In Reilly, supra, the Privy Council considered the claim of a member of the Federal Appeal Board, who lost his position when Parliament repealed the applicable enabling legislation. The Privy Council stated that it was irrelevant whether or not a contract existed, since performance of the contract was rendered impossible by the statutory abolition of the office. Since the relationship was statutory, then all rights and obligations were created by the statute, and the Crown was relieved of all obligations under it.
[15] In 1999, the Supreme Court of Canada in Wells v. Newfoundland, [1999] 3 S.C.R. 199 clarified the law with respect to the Crown's role and the obligation owed by it to senior civil servants. In this case, Mr. Wells was a member of a provincial regulatory agency, the Public Utilities Board. He claimed damages for breach of contract when his office disappeared upon the statutory abolition of the agency some four and one half years after his appointment. Mr. Wells had originally been appointed by Order in Council during good behaviour until the age of 70. The Supreme Court decided that the employment relationship between the Crown and senior public employees is based on contract to which the general law of contract applies unless specifically superseded by explicit terms in the statute or the agreement.
[16] Major J., writing for the Court, stated at paragraph 30:
As Beetz J. clearly observed in Labrecque, supra, the common law views mutually agreed employment relationships through the lens of contract. This undeniably is the way virtually everyone dealing with the Crown sees it. While the terms and conditions of the contract may be dictated, in whole or in part, by statute, the employment relationship remains a contract in substance and the general law of contract will apply unless specifically superceded by explicit terms in the statute or the agreement.
(My emphasis)
[17] The Supreme Court expressly recognized that the legislature had the right to abolish Mr. Wells' office. That being said, it was reasonable to infer that Mr. Wells' financial security was intended to survive the elimination of his position. The legislature could not strip Mr. Wells of the compensation flowing from the employment contract unless it had enacted a provision especially empowering it to do so. However, since no such legislative provision was passed, Mr. Wells' basic contractual rights to severance pay remained. The Court decided that Mr. Wells' damages should be calculated "based on his loss of the chance to serve his full term and earn the accompanying salary and benefit". In addition, the usual rules of mitigation applied. The Supreme Court affirmed the damages assessed by the Court of Appeal, namely damages equal to two and a half years' salary and pension benefits to which he would have been entitled for such additional service.
[18] Applying Wells, supra, it is necessary to determine the terms and conditions of the employment contract between the plaintiff and defendant. Before being appointed commissioner, the plaintiff asked the Minister of Agriculture to provide him with all applicable terms and conditions of employment. Further to his request, he was supplied with a copy of the Terms, which are identical in content to the document reproduced as Tab 9 in Exhibit C-1. The plaintiff was also generally aware of his obligations under the Code. As all those terms and conditions of employment were satisfactory to him, the plaintiff promptly notified his acceptance. Naturally, this meant that he had to divest himself of certain interests, which he did by transferring inter alia some shares into a family trust or under the name of his wife.
[19] The Terms, which were accepted by the plaintiff, set out in a precise and comprehensive fashion the Crown's contractual obligations towards the commissioners. The Terms provide, inter alia, the following benefits: an employee assistance plan, a sick leave plan, a short-term disability plan, a long-term disability plan, a vacation entitlement of eight weeks per year (four weeks could be deferred or cashed out), eleven paid holidays, special leave entitlement, a company automobile (replaced every two years), free parking, one dining and recreational club membership, reimbursement of business and professional memberships, air travel standards (first class for overseas destinations and business class for domestic), financial counselling, insurance plans and pension benefits.
[20] The Terms also provide a complete "exit compensation package" upon termination, voluntary resignation or retirement, as the case may be. This contractual feature is of cardinal importance and readily distinguishes this case from Wells, supra. Sections 5, 6, 7 and 11 are relevant. They provide as follows:
5. RETIRING ALLOWANCE
C One (1) week salary for each completed year of continuous employment upon retirement.
C Prior to August 1, 1988 sick leave plan grandfathered unused sick leave. The payment upon retirement is 60% of unused sick days times the ratio of unused days to total days earned times the average salary for the six (6) consecutive years of highest paid pensionable service.
6. LONG SERVICE ALLOWANCE
C With ten (10) or more years of service, one-half (½) week's salary for each year of continuous employment to a maximum of thirteen (13) weeks' salary upon termination or voluntary resignations.
7. LOSS OF OFFICE PAYMENT
C Two (2) years' salary after three (3) years of continuous Board service.
C This benefit is paid upon termination, voluntary resignation or retirement.
C A Commissioner is prohibited from accepting employment in a commercial grain marketing organization for up to two (2) years after leaving the Board.
...
11. COMPANY AUTOMOBILE
C Any standard size fully equipped automobile, except luxury models such as Cadillacs, Mercedes, Continentals, etc.
C The replacement period of this vehicle is two (2) years or 50,000 kilometres.
C Upon retirement or resignation, while in good standing, a Commissioner may purchase the automobile he or she is driving from the Board, at its depreciated value.
(My emphasis)
[21] I will come back to the effects of these provisions which, in my opinion, constitute an absolute bar to the claim made by the plaintiff for further compensation. First, however, I will briefly review the circumstances relevant to the present claim.
[22] In 1996, Bill C-72 An Act to amend the Canadian Wheat Board Act and to make consequential amendments to other Acts, 2nd Sess., 35 Parl., 1996, was tabled in the House of Commons. It provided, inter alia, for the termination of the positions of commissioners of the Board. It went through first and second reading, after which the House prorogued in May of 1997. In October 1997, it was then re-tabled under Bill C-17 and obtained Royal Assent on June 11, 1998. At trial, the plaintiff testified that although both Bill C-72 and Bill C-17 resulted in fundamental restructuring of the Canadian Wheat Board, "he never paid attention to these Bills", as he considered them to be an "Ottawa policy issue". The plaintiff states that he became aware of the changes in the legislation on June 11, 1998. I find this hard to believe, considering the senior position held by the plaintiff and the responsibilities he had. Indeed, in the years preceding the filing of Bill C-72, as we will see later on, the commissioners, including the plaintiff, were very vigilant to ensure that the government would not touch in any manner the exit compensation package contained in the Terms.
[23] Section 33 of the Amending Act provides:
| 33. On the date referred to in section 3.08 of the Canadian Wheat Board Act, as enacted by section 3 of this Act, appointments of commissioners made under section 3 of the Act, as it read before the coming into force of section 3 of this Act, are terminated.
(My emphasis) |
|
33. Le mandat des commissaires nommés sous le régime de l'article 3 de la Loi sur la Commission canadienne du blé, dans sa version antérieure à l'entrée en vigueur de l'article 3 de la présente loi, prend fin à la date mentionnée à l'article 3.08 de la Loi sur la Commission canadienne du blé, édicté par l'article 3 de la présente loi.
(mon soulignement) |
[24] In light of the above stated provision, the appointments of every commissioner, including the plaintiff, were terminated on December 31, 1998. The Board was continued after December 31, 1998. However, it no longer acted as an agent of Her Majesty, nor as a Crown corporation. Its business and affairs would from then on be managed by a board of fifteen directors, the majority of whom are now elected by the grain producers and perform their functions on a part-time basis.
[25] By letter dated December 18, 1998, the plaintiff informed Mrs. Wallace, Executive Director, Human Resources, at the Board that he was aware that his office was being eliminated as of December 31, 1998. He further stated that without prejudice to any rights that he may have had under his employment contract, he would "retire" due to that loss of office. The plaintiff informed Mrs. Wallace that his retirement would be effective as of January 1, 1999. I note that in this letter, the plaintiff is careful in the use of his words. The words "termination" or "breach of contract" are absent. Evidently, this was done on purpose, as the benefit provided for in section 5 (retiring allowance) of the Terms is only payable upon "retirement", while the benefit conferred in section 11 (purchase of the company automobile at its depreciated value) is only granted upon "retirement or resignation, while in good standing". Further to this letter, Mrs. Wallace understood that the plaintiff intended to resign and accordingly prepared the necessary documents required for signing, which as she states in her testimony: "would have had like payments information on his benefits. We had a package we would all give out, in terms of him resigning from the Board".
[26] On December 29, 1998, pursuant to section 11 of the Terms, the plaintiff purchased the company automobile he was driving, a 1998 Jeep Grand Cherokee, for the depreciable value of $28,790.57 (GST included). The plaintiff also chose to receive a deferred annuity payable at the age of 60 years. However, he was not aware of his eligibility for a waiver of the annual allowance reduction of 11.5%. On February 28, 1999 the plaintiff, therefore, applied for such a waiver. Pursuant to the delegated authority form the Treasury Board, on April 27, 1999, Mr. Fleury, Assistant Secretary to the Cabinet, approved the waiver of the applicable annual allowance reduction.
[27] On December 29, 1998, the plaintiff was also paid a total amount of $352,079.36 before deductions. This amount was made up as follows:
(a) $2,704.31 - salary (5 days) December 28, 1998 to January 1, 1999;
(b) $32, 451.72 - long service (12 weeks);
(c) $282, 200.00 - loss of office (2 years);
(d) $16,225.86 - severance (6 weeks); and
(e) $18, 497.47 - vacation (34.2 days)
[28] Thus, I find that the plaintiff received all that he was entitled to upon retirement under the Terms. I note that the amount provided for long service (12 weeks) is the equivalent of the "Retiring Allowance" under the Terms. Similarly the word "severance" (6 weeks) is used to indicate "Long Service Allowance" under the Terms. It is also interesting to note that when calculating the plaintiff's long service allowance and his severance benefits, the two years the plaintiff served at the Canadian Grain Commission prior to his appointment to the Board were taken into account. In my view, the Terms were comprehensive and accordingly, after December 29, 1998, the defendant was under no obligation to negotiate further compensation with the plaintiff.
[29] The following document, provided by Human Resources, was also signed by the plaintiff:
RELEASE
I, Richard Klassen, in consideration of receipt of the sum of $282,200.00 less all required statutory deductions, of which is hereby acknowledged as payment for the two year loss of office provision under the following conditions:
I AGREE that payment of this sum prohibits me from accepting employment, consulting or advising parties on grain marketing with respect to those crops under the jurisdiction of the Canadian Wheat Board, for two (2) years after leaving the Canadian Wheat Board.
It is understood that I will fully comply with the Federal Government's Conflict of Interest and Post Employment Code for Public Office Holders detailed in the attached.
December 29, 1998
(s) Richard Klassen (s) Pat Wallace
(My emphasis)
[30] Below the two signatures, the following handwritten text appears:
I Richard Klassen agree to sign this document under duress to ensure my entitlement to what is rightfully mine. This is due to loss of office.
(My emphasis)
[31] I must now address the argument advanced by the plaintiff that the release was signed under "duress". It has been recognized that a contract or release signed under duress is not void from the beginning, but is voidable (Larden v. Canada (1998), 145 F.T.R. 140 at para. 36 (F.C.T.D.)). I do not know how duress can be argued, since the plaintiff received all that he was entitled to in accordance with the Terms. That being said, in the present case, there is absolutely no credible evidence of "duress". As stated earlier, on December 18, 1998, the plaintiff informed Mrs. Wallace that he would "retire" due to his office being terminated and availed himself of the benefits provided in the Terms to a "resigning" commissioner. As explained by Mrs. Wallace in her testimony, this "release" was a standard document similar to the one signed in 1996 by a former commissioner. Though the plaintiff may have given the impression he was frustrated, as explained by Mrs. Wallace, his frustration may be explained by the fact that his employment as Trade representative, which had been discussed with government officials in the preceding months, had not materialized. It is also surprising that after having allegedly signed the release under duress, the plaintiff did not immediately take action, but waited nearly two years before instituting the present proceeding.
[32] Coming back to the interpretation and effects of the LOP provision, I note that the plaintiff's terms and conditions of employment were negotiated and an agreement was reached. As such, the Terms form a binding contract. The most reasonable interpretation of the plaintiff's contract of employment, as acknowledged in the Terms, is that upon "termination", the plaintiff was entitled to receive two years of salary as compensation in lieu of damages. The word "termination" has been defined as being a severance of the relation between employer and employee, whether by deliberate withdrawal (quitting); by involuntary withdrawal owing to illness, accident or disability; or by discharge or lay-off not followed by rehiring (Goguen v. Metro Oil Co., [1989] N.B.J. No. 136 (N.B.C.A.) (QL); Linda P. Collier, Pension vocabulary (Ottawa: Dept. of Secretary of State of Canada, 1990); and Black's Law Dictionary, 5th ed.). As such, the word "termination" can be used for both involuntary and voluntary termination of employment.
[33] The plaintiff now argues that there would be an implied contractual obligation to provide further compensation in case of termination without cause. The plaintiff submits that the sum of $282,200.00 he received under the LOP provision is strictly a two years' non-competition agreement. I must reject these propositions, which are contrary to the parties' intention and are not supported by a proper construction of the Terms. Although they are labelled "retiring allowance", "long service allowance" and "loss of office payment", overall, the benefits mentioned in sections 5, 6 and 7 of the Terms are triggered by the same event, namely the termination of appointment. Clearly, they constitute the "exit compensation package" that the commissioners have negotiated and are contractually entitled to receive when they retire or voluntarily resign, or when their appointment with the Board is terminated. In my opinion, the LOP is more akin to a "severance pay"; that is, a payment made by an employer to an employee on separation from employment in recognition of past service and intended to cushion economic hardship in providing some compensation for loss of employment (Mattdocks v. Smith & Stone (1982) Inc., 34 C.C.E.L. 273 at 279 (Ont. Ct. Gen. Div.)). This explains why the Terms provide that there be at least three years of continuous service. The three years requirement is evidently linked to the fact that the qualifying commissioner may have been sufficiently removed from his previous private or public sector position. As such, the two years' salary benefit was evidently considered at the time as fair and reasonable compensation. Indeed, the LOP provision was extremely advantageous for the commissioners, especially at a time where the common law under Reilly, supra, provided for absolutely no loss of office compensation.
[34] Therefore, reading the contract of employment as a whole, I cannot accept the plaintiff's argument that the LOP is merely a non-competition provision and that the LOP of $282,200.00 is merely in consideration of an agreement not to compete during a two-year period. From a contextual perspective, this proposition does not make any sense. The prohibition not to compete already exists as a predetermined condition of employment. All full time Governor in Council appointees, including the plaintiff, must abide by the Code, which already provides for a one year cooling-off period. During this period, unless a reduction is granted, the former appointee is not permitted to accept an appointment to a board of directors or employment with an entity with which he had direct or significant official dealings during the year preceding the end of his mandate. I further note that the obligation not to compete for a period of two years inscribed in the LOP provision, because of the grandfathering of the Terms, only applies to those commissioners who were appointed before December 31, 1994, provided that they have been continuously employed for a period of more than three years. If the LOP provision was truly a non-competition clause why then limit its application in such fashion?
[35] Moreover, the extrinsic evidence confirms that the parties' intention was to set out in the Terms all the terms and conditions of employment of the commissioners, including what they were entitled to in case of termination. The issue of appropriate legislative authority for setting the terms and conditions of compensation for the Board commissioners had been a matter of discussion off and on with the Treasury Board since 1984. Various meetings, letters and phone calls were exchanged from 1985 through 1988 between the Chief Commissioner and government representatives on this matter. The government's position was that the Financial Administration Act already required these conditions of employment to be approved. That being said, the legislative authority was nevertheless clarified when the latter Act was amended in 1991. Treasury Board approval of the compensation package was made a formal and mandatory requirement under the law.[1] This undoubtedly included the approval by the Treasury Board of any benefit granted in case of termination even though the money may be disbursed out of the funds managed by the Board.
[36] Further to these legislative clarifications, the LOP provision emerged as a "key item of discussion". In 1993, the government requested that the LOP provision be removed from the Terms. This particular provision and some others were viewed as being far too generous (particularly the vacation entitlement of eight weeks). Furthermore, they had never been formally approved by the Treasury Board. That being said, the commissioners vehemently opposed the government's request to remove the LOP provision and to reduce the other benefits provided in the Terms. The Chief Commissioner, with the support of all commissioners, advocated that the two years LOP provision covered legitimate business reasons and protected the Board's commercial interests and strategic plans. It was argued that the LOP was necessary to prevent a commissioner from taking employment in the grain trade industry for a two years cooling off period.
[37] However, this first argument did not really convince the government. The Code already served this purpose (at least partly). If required, special measures could always be devised to prevent potential post-retirement conflict of interest. Mr. McCutcheon, who is currently the Director General, Senior Personnel Secretariat in the Privy Council Office and who has held a series of positions in the Secretariat since 1991, testified that, to his knowledge, there were no other Crown corporations, and no other Governor in Council appointees, where employees were entitled to receive two years' salary in cases of voluntary resignation or retirement. On the other hand, the government had no objection to provide an appropriate compensation package for involuntary loss of office without cause, and in fact, according to the witness, it had done so contractually in a number of cases. Mr. McCutcheon also noted that the decision of the Supreme Court in Wells, supra, had not been rendered, and further indicated that in case of involuntary loss of office without cause, it had always been the government's position that there was no legal obligation to negotiate any sort of compensation. I note here that the government's "legal" position was not only in line with Reilly,supra, but also with this Court's jurisprudence: Canada v. Beauchamp (1990), 31 F.T.R. 50 (F.C.T.D.); and Petryshin v. Canada (T.D.) (1993), 65 F.T.R. 38 (F.C.T.D.). That being said, as explained by Mr. McCutcheon in his testimony, the "policy" position of the government was to negotiate reasonable and fair compensation upon termination, unless there was already a pre-agreed entitlement to a particular sum of money in the employment contract.
[38] However, another more compelling argument for the maintenance of the exit compensation package was made to the government by the commissioners. They submitted that the LOP provision, together with the other terms and conditions of employment found in the Terms, were deemed to be a part of their offer of employment and thus constituted a contractual obligation of the Crown. This became their major argument. Recognizing this contractual commitment, as explained by Mr. McCutcheon, in his testimony, the government agreed in 1995 to grandfather the LOP. The fact that the LOP refers, in the third paragraph, to the prohibition for the commissioner who leaves the Board from accepting employment in a commercial grain marketing organization for up to two years, is not conclusive and only constitutes an anachronism of the past.
[39] In conclusion, I find that the Terms were complete and addressed the fundamental aspects of the employment relationship of the commissioners, including what particular benefits were payable in case of termination. The fact that the word "termination" was specifically used in the Terms would not have been left unnoticed by the commissioners who vigorously sought to defend their terms and conditions of employment. The evidence reveals that the commissioners were astute and capable bargainers. At no point during these negotiations, when the government sought to open up the employment contract and to bring it in line with the framework established by the Treasury Board and the Privy Council, did they raise the fact that the benefits payable in case of termination were not acceptable to them. They treated these benefits as a complete package.
[40] Accordingly, I conclude that the defendant's contractual obligation was fully discharged by the payment of compensation equivalent to two years of salary, together with ancillary compensation payable under the Terms. Therefore, the plaintiff is not entitled to any further compensation and the present action must fail. Costs are to be awarded in favour of the defendant.
ORDER
THE COURT ORDERS THAT this action be dismissed with costs in favour of the defendant.
"Luc Martineau"
Judge
FEDERAL COURT
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-2100-01
STYLE OF CAUSE: RICHARD HOWARD KLASSEN v. HER MAJESTY THE QUEEN
PLACE OF HEARING: WINNIPEG, MANITOBA
DATE OF HEARING: NOVEMBER 18, 2003
REASONS FOR ORDER
AND ORDER: THE HONOURABLE MR. JUSTICE MARTINEAU
DATED: FEBRUARY 6, 2004
APPEARANCES:
MR. DAVID MARR FOR THE PLAINTIFF
MR. DONALD RENNIE FOR THE DEFENDANT
MS. RAMONA ROTHSCHILD
SOLICITORS OF RECORD:
MR. DAVID MARR FOR THE PLAINTIFF
CAMPBELL, MARR
WINNIPEG, MANITOBA
MR. MORRIS ROSENBERG FOR THE DEFENDANT
DEPUTY ATTORNEY GENERAL OF CANADA
[1] An Act to amend the Financial Administration Act and other Acts, S.C. 1991, c. 24, para. 2(2)(e.1). This latter provision then became paragraph 7(1)(e.1) of the Financial Administration Act, R.S.C. 1985, c. F-11 which provides that the Treasury Board may act for the Queen's Privy Council for Canada on all matters relating to the terms and conditions of employment of persons appointed by the Governor in Council that have not been established under this or any other Act of Parliament or order in council or by any other means.