Wrongful Dismissal and Summary Judgment in Alberta
One of the evolving areas of law in wrongful dismissal is the availability of summary judgment.
Up until the Supreme Court of Canada's 2014 decision in Hryniak, the test for summary judgment was very high: Any material factual issue genuinely in dispute could block summary judgment, requiring the parties to go to a full trial instead.
In Hryniak, the Supreme Court found that a "culture shift" was necessary, requiring judges "to actively manage the legal process in line with the principle of proportionality."
The impact of Hryniak is complicated. The case itself dealt with the interpretation of new summary judgment rules in Ontario, where 2010 amendments to the Rules of Civil Procedure granted the courts significant discretion to determine questions of fact (or to craft an expeditious process for the determination of those questions) on a motion for summary judgment.
Once Hryniak cemented the interpretation of those rules, the impact on wrongful dismissal actions in Ontario was immediate and dramatic: In many wrongful dismissal actions, the core issue in dispute is the length and value of the reasonable notice period - turning on well-established factors like length of service and character of employment. Even though character of employment has long been a factor of "declining relative importance", differences in characterization of the employment relationship - the level of responsibility of the employee, etc. - could historically derail a summary judgment procedure. Even though the impact of that factual dispute might only play a very marginal role in the quantification of damages, it could require the parties to incur great expense in the course of a trial.
Hryniak enabled Ontario judges to take a broad look at the issues in dispute: If it was generally appropriate to do so (achieving a 'just' resolution in a proportionate, timely, and cost-effective way), a judge could weigh the evidence and make the necessary factual findings to dispose of the proceedings.
Quickly, this became the preferred way of dealing with wrongful dismissal cases in Ontario. Even in cases with disputes that might not be easily amenable to summary judgment, like claims for 'manner of dismissal' damages, the Ontario courts have tended to grant partial summary judgment.
However, in Alberta, the story is a bit different.
The law on this issue is still evolving in Alberta, but the problem arises from certain structural differences in the courts. Not only do the summary judgment procedures in Alberta's Rules of Court lack the broad statement of powers and range of procedural options conferred by Ontario's Rules of Civil Procedure, but most interlocutory applications in Alberta are heard by Masters in Chambers - who are not judges and whose fact-finding powers are severely constrained by constitutional limitations.
Ontario, too, has Masters. However, in Ontario, their role has historically been relatively limited: They barely exist outside Toronto itself, and in Toronto they are limited to certain classes of proceedings - bankruptcy proceedings, construction lien actions, and certain types of procedural motions.
As such, whereas summary judgment applications in Alberta are almost always heard by Masters, summary judgment motions in Ontario are almost always heard by Superior Court Judges.
So while the Supreme Court's imperative for a "culture shift" applies to Alberta just as it does to Ontario, it is much more difficult to apply in Alberta, where the summary judgment process is generally filtered through decision-makers who arguably lack the authority to exercise the discretion mandated by the SCC. Indeed, there is an open question as to whether or not Masters are ever able to assess reasonable notice periods in wrongful dismissal litigation.
Specifically, Masters are unable to assess damages where doing so requires them to weigh evidence as to disputed facts. And the question is whether or not an assessment of reasonable notice inherently requires a Master to do so. There are two lines of cases on the point.
Masters Schlosser and Robertson have concluded that assessing the reasonable notice period, at least in a case with undisputed facts, is simply the application of the law to the facts - an exercise well within the jurisdiction of a Master. Furthermore, a broad interpretation of a Master's powers in this regard is better aligned with the "culture shift" called for by the SCC, and with the Master's role as 'gatekeeper' to the courts. (See, for example, the Nixdorf and Schaffer cases.)
On the other hand, Master Farrington has found that determining the reasonable notice period, in wrongful dismissal cases, requires a Master to determine the 'weight' to be applied to the different Bardal factors - and that this 'weighing' falls within the constitutional prohibition on the weighing of evidence.
One of Master Farrington's cases, Coffey, was recently appealed. Justice Nixon upheld Master Farrington's conclusions, citing Ontario case law that characterizes assessing the reasonable notice period as involving "weighing various factors". For the moment, therefore, that would appear to be the law in Alberta.
There is good reason to question the Farrington approach. In particular, any similarity between 'weighing the Bardal factors' and 'weighing evidence' seems to be more semantic than functional: the Bardal factors are not properly characterized as 'evidence', but as 'facts'; when you weigh them, you are not assessing their relative reliability or credibility, but their relative significance.
The weighing of evidence is a fact-finding exercise, where the court looks at two competing versions of the facts, and determines which version to accept as true. If a witness lacks credibility, a judge will give little or no 'weight' to his evidence. The 'weighing' of the Bardal factors, however, is done after reaching findings as to the underlying facts.
For example, if a plaintiff swore to be 60 years old, and the defendant led evidence to show that the plaintiff is only 30, then the court would be put into the position of having to 'weigh evidence'. For obvious reasons, this almost never happens, and the age of an employee is almost always 'undisputed'. As such, there is never any 'weighing of evidence' in respect of the plaintiff's age: A court can usually accept that a given plaintiff's age is (for example) 60, without needing to weigh competing versions of the evidence. Likewise, while there can be conflicting evidence as to the other Bardal factors, it is not at all uncommon to see cases where there is no conflicting evidence relating to length of service, character of employment, or availability of replacement employment.
In a scenario where all four 'usual' factors are undisputed (and where no extended factors are advanced for consideration), 'weighing' them means deciding what impact each has on the reasonable notice period. You might have a 60 year old employee with 40 years of service, in an ostensibly replaceable front line customer service job: Age and length of service would tend toward a longer period of notice; character of employment and availability of replacement employment would tend toward a shorter period of notice.
The length of the reasonable notice period is sometimes characterized as a question of fact; sometimes as a mixed question of fact and law. Regardless of which is more accurate for 'standard of review' purposes, it we step back to first principles, it's clear that the reasonable notice period is a legal construct, and not a factual one.
The obligation to give reasonable notice is a contractual term implied by the common law, specifically through the type of contractual terms implied 'as legal incidents of a particular class or kind of contract'. (Most implied contractual terms deal with presumed or actual mutual intent of the parties, and would be fundamentally factual considerations. This is not one of those types of terms.) So while the Bardal factors are broadly intended to approximate the amount of time it would reasonably take an employee to replace the job, we don't regard that factual question as any sort of 'unifying principle' of Bardal. The obligation to give reasonable notice, and the precise definition of the reasonable notice period, is built on legal principles, quite thoroughly divorced from any specific factual question.
The lynchpin in the Schlosser/Robertson approach is the treatment of reasonable notice assessments on appellate review: While the threshold test for appellate interference is complex and controversial, it is nearly unheard of for an appellate court to send a matter back down to the trial level for re-determination of reasonable notice periods. If the threshold test for appellate interference is satisfied, the appellate court will almost always substitute its own determination of the reasonable notice period, without needing to hear viva voce evidence or to don the trial judge's fact-finding mantle.
If determining the length of the reasonable notice period was actually an exercise of a court's fact-finding function, appellate courts would tend toward remitting the question back to the lower courts, barring exceptional circumstances.
However, there does not seem to be much room to get around the requirement that the relevant facts be strictly undisputed for the Master to have jurisdiction to assess the reasonable notice period. Even the slightest evidentiary dispute relating to the Bardal factors will put it outside the Master's jurisdiction. Furthermore, there can be contextual disputes as well: For example, one might argue that age plays a greater or lesser role in re-employability in a given industry, and a dispute on that type of factual matter would likewise put the matter outside the scope of a Master's jurisdiction.
In other words, even if one accepts the Schlosser/Robertson approach as accurate, the Master's ability to grant summary judgment on these matters is still no greater than the pre-Hryniak test for summary judgment.
Justice Nixon argues that the culture shift can be addressed through the summary trial mechanism in Alberta's Rules of Court. There is some merit to this. Maybe. It is a mechanism that has been used occasionally for wrongful dismissal matters, and the process at its minimum is virtually indistinguishable from a summary judgment application. However, the process at its highest can look awfully like a full trial, and there is relatively little guidance in either the Rules or the case law as to the circumstances in which a court should decline to hear viva voce evidence.
The challenge here seems to be one of resource allocation. Where Ontario long ago shifted most of its interlocutory proceedings into the hands of judges, Alberta has relied heavily upon Masters - and to good effect. But while a 'culture shift' to interlocutory resolution of substantive issues is fairly easy to accomplish when you already have judges hearing all your interlocutory proceedings, it's a much taller order for a Province like Alberta.
Between my work as a lawyer (in Ontario and Alberta) and as a law student, I have well over a decade of experience in wrongful dismissal cases, on both sides. Every case has its unique features, and yet in the vast majority of cases, the likely range of outcomes is narrow enough that a settlement should be possible.
Where an early settlement can't be achieved, it is usually for one of a few reasons:
Up until the Supreme Court of Canada's 2014 decision in Hryniak, the test for summary judgment was very high: Any material factual issue genuinely in dispute could block summary judgment, requiring the parties to go to a full trial instead.
In Hryniak, the Supreme Court found that a "culture shift" was necessary, requiring judges "to actively manage the legal process in line with the principle of proportionality."
The impact of Hryniak is complicated. The case itself dealt with the interpretation of new summary judgment rules in Ontario, where 2010 amendments to the Rules of Civil Procedure granted the courts significant discretion to determine questions of fact (or to craft an expeditious process for the determination of those questions) on a motion for summary judgment.
Once Hryniak cemented the interpretation of those rules, the impact on wrongful dismissal actions in Ontario was immediate and dramatic: In many wrongful dismissal actions, the core issue in dispute is the length and value of the reasonable notice period - turning on well-established factors like length of service and character of employment. Even though character of employment has long been a factor of "declining relative importance", differences in characterization of the employment relationship - the level of responsibility of the employee, etc. - could historically derail a summary judgment procedure. Even though the impact of that factual dispute might only play a very marginal role in the quantification of damages, it could require the parties to incur great expense in the course of a trial.
Hryniak enabled Ontario judges to take a broad look at the issues in dispute: If it was generally appropriate to do so (achieving a 'just' resolution in a proportionate, timely, and cost-effective way), a judge could weigh the evidence and make the necessary factual findings to dispose of the proceedings.
Quickly, this became the preferred way of dealing with wrongful dismissal cases in Ontario. Even in cases with disputes that might not be easily amenable to summary judgment, like claims for 'manner of dismissal' damages, the Ontario courts have tended to grant partial summary judgment.
However, in Alberta, the story is a bit different.
The Alberta Experience - So Far
The law on this issue is still evolving in Alberta, but the problem arises from certain structural differences in the courts. Not only do the summary judgment procedures in Alberta's Rules of Court lack the broad statement of powers and range of procedural options conferred by Ontario's Rules of Civil Procedure, but most interlocutory applications in Alberta are heard by Masters in Chambers - who are not judges and whose fact-finding powers are severely constrained by constitutional limitations.
Ontario, too, has Masters. However, in Ontario, their role has historically been relatively limited: They barely exist outside Toronto itself, and in Toronto they are limited to certain classes of proceedings - bankruptcy proceedings, construction lien actions, and certain types of procedural motions.
As such, whereas summary judgment applications in Alberta are almost always heard by Masters, summary judgment motions in Ontario are almost always heard by Superior Court Judges.
So while the Supreme Court's imperative for a "culture shift" applies to Alberta just as it does to Ontario, it is much more difficult to apply in Alberta, where the summary judgment process is generally filtered through decision-makers who arguably lack the authority to exercise the discretion mandated by the SCC. Indeed, there is an open question as to whether or not Masters are ever able to assess reasonable notice periods in wrongful dismissal litigation.
Specifically, Masters are unable to assess damages where doing so requires them to weigh evidence as to disputed facts. And the question is whether or not an assessment of reasonable notice inherently requires a Master to do so. There are two lines of cases on the point.
Masters Schlosser and Robertson have concluded that assessing the reasonable notice period, at least in a case with undisputed facts, is simply the application of the law to the facts - an exercise well within the jurisdiction of a Master. Furthermore, a broad interpretation of a Master's powers in this regard is better aligned with the "culture shift" called for by the SCC, and with the Master's role as 'gatekeeper' to the courts. (See, for example, the Nixdorf and Schaffer cases.)
On the other hand, Master Farrington has found that determining the reasonable notice period, in wrongful dismissal cases, requires a Master to determine the 'weight' to be applied to the different Bardal factors - and that this 'weighing' falls within the constitutional prohibition on the weighing of evidence.
One of Master Farrington's cases, Coffey, was recently appealed. Justice Nixon upheld Master Farrington's conclusions, citing Ontario case law that characterizes assessing the reasonable notice period as involving "weighing various factors". For the moment, therefore, that would appear to be the law in Alberta.
Analysis and Commentary
There is good reason to question the Farrington approach. In particular, any similarity between 'weighing the Bardal factors' and 'weighing evidence' seems to be more semantic than functional: the Bardal factors are not properly characterized as 'evidence', but as 'facts'; when you weigh them, you are not assessing their relative reliability or credibility, but their relative significance.
The weighing of evidence is a fact-finding exercise, where the court looks at two competing versions of the facts, and determines which version to accept as true. If a witness lacks credibility, a judge will give little or no 'weight' to his evidence. The 'weighing' of the Bardal factors, however, is done after reaching findings as to the underlying facts.
For example, if a plaintiff swore to be 60 years old, and the defendant led evidence to show that the plaintiff is only 30, then the court would be put into the position of having to 'weigh evidence'. For obvious reasons, this almost never happens, and the age of an employee is almost always 'undisputed'. As such, there is never any 'weighing of evidence' in respect of the plaintiff's age: A court can usually accept that a given plaintiff's age is (for example) 60, without needing to weigh competing versions of the evidence. Likewise, while there can be conflicting evidence as to the other Bardal factors, it is not at all uncommon to see cases where there is no conflicting evidence relating to length of service, character of employment, or availability of replacement employment.
In a scenario where all four 'usual' factors are undisputed (and where no extended factors are advanced for consideration), 'weighing' them means deciding what impact each has on the reasonable notice period. You might have a 60 year old employee with 40 years of service, in an ostensibly replaceable front line customer service job: Age and length of service would tend toward a longer period of notice; character of employment and availability of replacement employment would tend toward a shorter period of notice.
The length of the reasonable notice period is sometimes characterized as a question of fact; sometimes as a mixed question of fact and law. Regardless of which is more accurate for 'standard of review' purposes, it we step back to first principles, it's clear that the reasonable notice period is a legal construct, and not a factual one.
The obligation to give reasonable notice is a contractual term implied by the common law, specifically through the type of contractual terms implied 'as legal incidents of a particular class or kind of contract'. (Most implied contractual terms deal with presumed or actual mutual intent of the parties, and would be fundamentally factual considerations. This is not one of those types of terms.) So while the Bardal factors are broadly intended to approximate the amount of time it would reasonably take an employee to replace the job, we don't regard that factual question as any sort of 'unifying principle' of Bardal. The obligation to give reasonable notice, and the precise definition of the reasonable notice period, is built on legal principles, quite thoroughly divorced from any specific factual question.
The lynchpin in the Schlosser/Robertson approach is the treatment of reasonable notice assessments on appellate review: While the threshold test for appellate interference is complex and controversial, it is nearly unheard of for an appellate court to send a matter back down to the trial level for re-determination of reasonable notice periods. If the threshold test for appellate interference is satisfied, the appellate court will almost always substitute its own determination of the reasonable notice period, without needing to hear viva voce evidence or to don the trial judge's fact-finding mantle.
If determining the length of the reasonable notice period was actually an exercise of a court's fact-finding function, appellate courts would tend toward remitting the question back to the lower courts, barring exceptional circumstances.
The Fettered Culture Shift
However, there does not seem to be much room to get around the requirement that the relevant facts be strictly undisputed for the Master to have jurisdiction to assess the reasonable notice period. Even the slightest evidentiary dispute relating to the Bardal factors will put it outside the Master's jurisdiction. Furthermore, there can be contextual disputes as well: For example, one might argue that age plays a greater or lesser role in re-employability in a given industry, and a dispute on that type of factual matter would likewise put the matter outside the scope of a Master's jurisdiction.
In other words, even if one accepts the Schlosser/Robertson approach as accurate, the Master's ability to grant summary judgment on these matters is still no greater than the pre-Hryniak test for summary judgment.
Justice Nixon argues that the culture shift can be addressed through the summary trial mechanism in Alberta's Rules of Court. There is some merit to this. Maybe. It is a mechanism that has been used occasionally for wrongful dismissal matters, and the process at its minimum is virtually indistinguishable from a summary judgment application. However, the process at its highest can look awfully like a full trial, and there is relatively little guidance in either the Rules or the case law as to the circumstances in which a court should decline to hear viva voce evidence.
The challenge here seems to be one of resource allocation. Where Ontario long ago shifted most of its interlocutory proceedings into the hands of judges, Alberta has relied heavily upon Masters - and to good effect. But while a 'culture shift' to interlocutory resolution of substantive issues is fairly easy to accomplish when you already have judges hearing all your interlocutory proceedings, it's a much taller order for a Province like Alberta.
Personal Observations
Between my work as a lawyer (in Ontario and Alberta) and as a law student, I have well over a decade of experience in wrongful dismissal cases, on both sides. Every case has its unique features, and yet in the vast majority of cases, the likely range of outcomes is narrow enough that a settlement should be possible.
Where an early settlement can't be achieved, it is usually for one of a few reasons:
- There is a legitimate contested legal or factual issue with a significant impact on the employee's entitlements. Such issues include "Is this termination clause enforceable?"; "Is the employee entitled to the benefit of this bonus plan through the notice period?"; or, on rare occasions, just cause.
- One party (usually the employer) has unrealistic expectations, and a lawyer who lacks the experience and/or fortitude to successfully adjust the party's expectations. (There is a range here: Some cases do involve experienced and competent counsel, but particularly stubborn clients.)
- The amount in issue is likely to be outpaced by the cost of pursuing resolution, so the employer decides to play hardball in the hopes that the employee will decide to abandon the claim. (This is a dangerous tactic. I don't generally recommend it, and I've made a few opposing parties regret taking such an approach.)
Even in the first category, most cases are amenable to summary adjudication. It is quite rare to get a case where there are factual disputes that are both material and significant. (The two major areas here are 'just cause' and 'manner of dismissal' damages. However, the thresholds for both of these categories are so high that it's often the case that a court could accept the factual allegations for a 'just cause' defence or for 'manner of dismissal' damages while still rejecting the underlying argument.) And the legal issues are very commonly best addressed in the context of a motion - matters of contractual interpretation, for example, do not usually need a full trial with viva voce evidence.
In the second category, there are two ways of dealing with an unreasonable opposing party: Either go to an ADR process with a qualified employment law mediator who can help to educate and talk down the party, or go to a summary adjudication process and have the courts resolve the issue quickly.
And in the third category...well, this is where summary adjudication really dovetails with 'access to justice'. Summary adjudication helps to bring down the cost of litigation and it frees up court resources. And even beyond the direct mechanisms by which summary adjudication gets cases out of the system, the mere availability of summary adjudication tends toward easier settlement of litigation.
I have had files where the threat of summary adjudication has brought opposing parties to the table in meaningful ways. In one case, early in the days of Hryniak, an employer was refusing to put compensation components on the table to which, on the case law and the facts, my client was easily entitled. I told opposing counsel (a senior lawyer from a major Bay Street firm), "That's fine; I'll just bring a motion for summary judgment. What's your availability?"
That threat prompted an agreement to expedite mediation before a good employment law mediator, which resolved the litigation promptly in a way that was cost-effective for the parties and used basically no court resources.
When there's a fast and efficient way into court, it's more difficult to play hardball, take unreasonable positions in litigation, and try to drive up your opponent's costs.
*****
Dennis Buchanan is a lawyer practicing labour and employment law and civil litigation in Edmonton, Alberta.
This post does not contain legal advice, but only general legal information. It does not create a solicitor-client relationship with any readers. If you have a legal issue or potential issue, please consult a lawyer.
Dennis Buchanan is a lawyer practicing labour and employment law and civil litigation in Edmonton, Alberta.
This post does not contain legal advice, but only general legal information. It does not create a solicitor-client relationship with any readers. If you have a legal issue or potential issue, please consult a lawyer.
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