Lavallee v. Siksika Nation, 2011 ABQB 49

Court of Queen ’ s Bench of Alberta Citation: Lavallee v. Siksika Nation, 2011 ABQB 49 Date: 20110202 Docket: 0601 11137 Registry: Calgary Between: Melvyn Lavallee Plaintiff - and - Siksika Nation as Represented by its Chief and Council and Siksika Nation Tribal Administration and Siksika Health Services and Melvyn Tyler White Defendants _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice P.J. McIntyre _______________________________________________________ I. Introduction [ 1 ] After ten years of providing medical services on the Siksika Nation, Dr.

Melvyn Lavallee (the “Plaintiff”) and his wife were asked to leave the Siksika Medical Clinic (the “Clinic”) by security guards. He seeks damages for wrongful termination. [ 2 ] The Plaintiff is a medical doctor qualified to practice in Alberta. In 1995, at the age of 50, he started working at the Clinic on the Siksika Nation, one hour southeast of Calgary. The Defendants are Siksika Nation/Siksika Health Services (the “Defendants”).

[ 3 ] Mr. Tyler White (“Mr. White”) is an employee of the Defendants. Although, he was personally named in this action, the Plaintiffs abandoned the defamation claim against Mr. White and the other Defendants at trial. The claims for breach of representation or unlawful interference with contractual relations have also been abandoned against the Defendants. [ 4 ] The Plaintiff claims that he was guaranteed the right to practice medicine at the Clinic until his 70 th birthday – a fixed term contract of about 20 years. In 2005, the Defendants terminated his arrangement with the Clinic.

The Plaintiff asserts that he had a fixed term contract, that it was breached, and he is entitled to damages. [ 5 ] The Defendants’ position is that it followed the agreement by providing the Plaintiff with reasonable notice. It denies that it breached the Plaintiff’s contract. The Defendants deny the Plaintiff was guaranteed the right to practice medicine at the Clinic until his 70 th birthday. Further, the Defendants acknowledge they did not have just cause to end the arrangement. II. Background [ 6 ] In 1995, the Clinic hired the Plaintiff to provide medical services. The Plaintiff was hired by Mr.

Dexter Redgun, who was then the Health Director of the Clinic. The Agreement was oral, never reduced to writing. [ 7 ] Mr. Tyler White became the Health Director of Siksika Health Services in 1999. [ 8 ] Under his agreement with Siksika, the Plaintiff began providing services at the Clinic in September 1995. He billed Alberta Health for medical services provided to Siksika Nation members. Initially, he worked three and a half days a week. In June of 1996, he increased this to four days a week, plus a half day on Fridays every other week.

Roughly one year later, he reduced his time, moving again to three and a half days a week. In 2003, he reduced his time to work three days a week and on February 23, 2004, the Plaintiff reduced his

schedule to two days a week effective April 1, 2004. Concurrently, he also established a medical practice in Strathmore, Alberta where he began practising medicine two days a week. [ 9 ] The Plaintiff testified at trial that he was becoming increasingly dissatisfied with the conditions at the Clinic. In August 2004, the Plaintiff was quoted in an

article in Windspeaker newspaper in which he was critical of health care on the Siksika Nation, including using nurse practitioners in an expanded role when doctors were on site.

The term “expanded” role referred to the fact that the nurse practitioners were given greater responsibilities than registered nurses in an urban setting. [ 10 ] Health Canada issued a directive dated July 30, 2004 in which it was noted that there had been two complaints received about the practice of nurses working in the expanded role and therefore “until further notice, there will be no nurses working in an expanded role, i.e. providing treatment services.” [ 11 ] On October 1, 2005 the Plaintiff brought his wife to the Clinic to help with the paper flow and other administrative duties as he felt that he was not receiving the assistance he required to conduct his practice.

On October 5, 2005, Dr. Crowshoe, the Medical Director of the Defendants since 2003, asked the Plaintiff to provide “a written description of the roles, responsibilities, credentials, legal coverage and proposed cost of your Medical Assistant [the Plaintiff’s wife] to me, as soon as possible . . .” The Plaintiff responded by letter on October 7, 2005. [ 12 ] On October 11, 2005 three pieces of correspondence were given to the Plaintiff: 1. Mr. White advised the Plaintiff that his services would no longer be required after January 15, 2006. (Exhibit 1, Tab 11) 2 Dr.

Crowshoe advised the Plaintiff that “Health Administration will need to provide final authorization for Dixie to provide service within the Siksika Medicine Lodge.” (Exhibit 1, Tab 13) Dixie is the Plaintiff’s wife.

3. A letter from Mr. White stating that his wife was not permitted to work at the Clinic until such authorization was secured. (Exhibit 1, Tab 12) [ 13 ] Many letters were then sent back and forth including the following: 1. A letter dated October 17, 2005 from Chief Strater Crowfoot warning the Plaintiff to abide by the wishes expressed to him in the correspondence he received on October 11, 2005. He said that if the Plaintiff did not refrain from bringing his wife to work it would become “necessary to seek a Band Council resolution banning you from Siksika Nation.” 2.

A letter dated October 19, 2005, from the Plaintiff to the Defendants stating that: “I will terminate my services to the Nation effective noon on Wednesday October 19, 2005.” 3. A letter dated May 5, 2006 from Chief Adrian Stimson to the Plaintiff confirming that “although you are not allowed to practice medicine at Siksika Nation you are a welcome member of the Public at Siksika Nation.” 4. A letter dated November 7, 2005 from Dr.

Crowshoe to the Plaintiff asking for a meeting to “discuss issues that are unresolved.” [ 14 ] The Plaintiff did not provide any medical services at the Clinic after October 19, 2005 and he had no further contact with either Mr. Tyler White or Dr. Crowshoe. [ 15 ] The Plaintiff called five witnesses at trial: Dr. Lavallee, Mr. Dexter Redgun, Jenny Goodin, Shirley Running Rabbit and Gerry Taunton, Labour Economist. [ 16 ] The Defence called six witnesses: Mr. Tyler White, Dr. Crowshoe, Mr. Schellenberg, Dr. Wierenga, Dr. Vik and Dr. Virani. III. Issues 1.

Did the Plaintiff and the Defendants enter into a fixed term contract? 2. If a fixed term contract was entered into, does the Statute of Frauds make the relationship unenforceable? 3. What was the nature of relationship between the Plaintiff and the Defendants? 4. Was the Plaintiff provided with reasonable notice? 5. Is the Plaintiff entitled to Wallace/Honda damages? IV. Evidence at Trial

A. The Plaintiff [ 17 ] The Plaintiff graduated from the University of Saskatchewan in 1970 and has worked in various locations in Alberta including on the Siksika Nation. He first found out about the opportunity to work on the Siksika Nation when he worked with Dr. Lash in Fort McMurray. Dr. Lash was then working on the Siksika Nation. She told the Plaintiff that she was busy and the Siksika Nation was looking for other doctors. [ 18 ] Mr. Redgun, the Health Director at the time, phoned the Plaintiff several times, telling him they were experiencing a shortage of doctors.

In August 1994, the Plaintiff did a locum for Dr. Lash on the Siksika Nation. [ 19 ] At trial, the Plaintiff explained that the Clinic was owned by Health Canada, fully equipped and staffed. The Clinic offered dental services, community health services as well as a pharmacy. After his locum finished the Plaintiff thought it was a “super practice” and liked that he was able to provide emergency services and do minor surgery. He continued to have discussions in early 1995 with Mr. Redgun, when the Clinic was again experiencing staffing difficulties. In June 1995, Dr.

Lash ended her services and the Plaintiff again provided services for the Siksika Nation. After that trial period, they discussed some firm arrangements about him working at the Clinic. [ 20 ] The Plaintiff said that he sat down with Mr. Redgun to discuss what it would take for him to leave Fort McMurray. He testified that it was a big move and he would have to relocate his family and sell his house and practice.

The Plaintiff testified that before accepting the position at the Clinic he wanted a specific commitment from the Band, including a fixed term contract until retirement at age 70, a guarantee of four working days a week, and access to the Clinic. All expenses associated with the Clinic were to be paid for by the Band. At the time, the Plaintiff had just extended his business lease in Fort McMurray until June 1996, which was a concern. In October 1995, he had a potential buyer for his practice. I assume the potential sale was successful as he started providing services at the Siksika Nation in September 1996.

During his final discussions with Mr. Redgun, the Plaintiff testified that in his mind it was a long- term agreement. [ 21 ] The Plaintiff testified that for the first eight years it was a “dream practice”. He had a full staff and a busy practice. He had access to adequate supplies, lab, x-rays and minor emergency facilities and his income was tax exempt. He billed and was remunerated based on direct billing to Alberta Health.

During 1997, as well as his employment on the reserve, he also provided medicals examinations for pilots for Transport Canada (the Plaintiff is also a pilot). [ 22 ] In early 2000, the Clinic started having issues with staff coverage and problems with supplies. In the early years of the practice, the Plaintiff was confident that they could handle any emergencies however this changed because of the staffing and supply shortages. There were two staff nurses who could help with emergencies. However, the Clinic was having trouble getting doctors to come in and assist.

The Plaintiff’s frustration was increasing and he had no avenue for seeking help; he was not consulted on any of the changes that were occurring [ 23 ] To voice some of his frustrations, the Plaintiff wrote a letter in February 2004 and a subsequent letter to Mr. Breaker, the Tribal Manager and former Chief. He received no response from Mr. Breaker, the Director of Health or the Health Committee to the first or second letter. He started negotiating with a clinic in Strathmore so he could bring patients there. [ 24 ] The Plaintiff argued that following the appointment of Mr.

Tyler White a significant change occurred in his working circumstances. These changes included sweeping organizational changes, funding cuts, and a directive from Health Canada that nurse practitioners were no longer to be used in an expanded role, limiting staff assistance to the doctors. The Plaintiff said the cumulative effect of these changes was that he was in a different position in February and March 2004 than when he entered the contract. [ 25 ] The Plaintiff was critical of nurses in the expanded role seeing patients without the presence of a physician.

In his view, the nurses should have been assisting physicians unless there was no physician coverage, for example in remote areas. He spoke to nurses at the Clinic and wrote to an individual at Health Canada sometime in 2003 expressing his concerns. At the same time, he expressed concern that there were too many nurses on site who were unwilling to assist the physicians in the Clinic i.e. the community nurses. [ 26 ] In May 2004, he gave an interview to a journalist with Windspeaker, a native newspaper published in Edmonton. The

article appeared for distribution in August 2004. The Plaintiff was quoted directly in the

article and was critical of some of the health care practices at the Clinic.

[ 27 ] According to the Plaintiff after the Windspeaker article, “all hell broke loose”. He said Mr. White became angry and decided to find some excuse to get rid of the Plaintiff. Further, according to the Plaintiff, he was blamed for “blabbering” his mouth about the nurses and their departure. Mr. White never met with nor discussed the

article with him. [ 28 ] The Plaintiff testified that he decreased his days from four to three a week in 2003 to give Dr. Crowshoe, the new doctor, one of his days. In 2004 according to the Plaintiff, funding cuts, disorganization, staff shortages, as well as the low quantity of supplies made it unsafe to practice more often. In varying the number of days worked, he had no intention of permanently giving up his contractual right to four clinic days a week.

He expected at some date to be able to increase his clinic days as circumstances allowed. [ 29 ] In August 2005, the Clinic was experiencing extreme staff shortages. The Plaintiff testified that he had no help at the front desk and no help with paperwork; in his view, the situation was critical. The Clinic had no supplies, no dressing or tape.

He felt that they were unable to treat patients effectively and that the Clinic had became a dangerous place to practice medicine. [ 30 ] To help with the critical staff shortage, the Plaintiff decided to hire his wife to help with the administrative duties; her first day being October 3, 2005. On the morning of October 5, 2005 he was confronted by Dr. Crowshoe, the medical director and then received a memo from Dr. Crowshoe asking him to describe his wife’s role. The Plaintiff did so in a memo dated October 7, 2005.

The Plaintiff testified that he hired his wife to help him with patient flow, she was to be paid by him and the Defendants would incur no liability from her working at the Clinic. Although she was trained as a registered nurse she was not to have a clinical role, only an administrative role. [ 31 ] According to the Plaintiff there was a confusion about the hierarchy and who was in charge of what. Dr.

Crowshoe continued to send e-mails to the Plaintiff saying that he wanted to sort things out but at this point, according to the Plaintiff, the decision to terminate him had already been made. [ 32 ] As noted above, the Plaintiff received a letter of termination from Mr. White. Mr. White did not meet with the Plaintiff in person. Instead he sent his secretary to deliver the termination letter. She did not hand deliver the letter to the Plaintiff but instead left it on his desk, where he found it sometime later between seeing patients at the Clinic. The Plaintiff testified that he was shocked.

He had never directly received a complaint from Mr. White or anyone else. [ 33 ] The Plaintiff met with Mr. Medicine Shield, a councillor of the Chief in Council, on October 13, 2005 and was advised not to cancel any medical clinics. He did not. He then responded to Mr. White’s letter on October 14, 2005. [ 34 ] On October 17, 2005 the Plaintiff received a faxed letter from Chief Strater Crowfoot asking that he abide by the wishes of Mr. White.

On October 19, 2005 the Plaintiff sent an urgent letter asking for confirmation of the authenticity of the letter. [ 35 ] In the Plaintiff’s opinion, unnecessary threats were made including, on October 14, 2005, calling security to escort him and his wife out of the building with no provocation, altercation or discussion. At Mr. Whites’ request the Plaintiff was advised by security that he and his wife had 30 minutes to leave the building. He refused to leave because he did not want to cancel any appointments. He told security that he would finish seeing the last patient at 3:00 p.m. and would then leave.

He testified that he received three warnings from security that day. [ 36 ] The Plaintiff did not accept the three month working notice provision and ended his services with the Siksika Reserve effective Wednesday, October 19, 2005. He did not provide any medical services at the Clinic after that date. The Plaintiff testified that he felt it was unsafe for his wife and him to be there. [ 37 ] On February 21, 2006 he met with the Chief to discuss rectifying the problems at the Clinic. At the end of the meeting, he was under the impression that the Chief thought the situation had been mishandled.

[ 38 ] He received a letter from Chief Adrian Stimson on May 5, 2006 stating that a motion to reinstate him at a council meeting was defeated. However, the letter stated that he was a welcome member of the public at Siksika Nation. He heard nothing further from the office of the Chief after this date and he only returned to the Siksika Nation once to attend a rally for a Chief candidate. [ 39 ] After he left in October 2005, he worked at the clinic in Strathmore four days per week. In November 2006, he relocated his practice to Chestermere, sharing the premises with another doctor.

In September 2006 he provided some services to Hobbema Reserve and is still providing those services to Hobbema today. [ 40 ] In April 2008 he joined other physicians in Strathmore where he now works two days per week. At the clinic in Strathmore and Chestermere he pays a portion of his income to cover staff and premises. His income is not tax exempt. His income on the Hobbema Reserve is tax exempt. B. Mr. Dexter Redgun [ 41 ] Mr. Redgun was the Health Director at the time the Plaintiff was hired by the Siksika Nation. Mr. Redgun has lived on the Siksika Nation all his life.

He started with health services in the late 1980's and soon became the acting Health Director and then a few months later was offered a full time position. [ 42 ] Between 1992 and 1994, Mr. Redgun reported to the senior manager as well as the health committee. Mr. Redgun testified that during this period of time the nurse in charge reported to an office in the Calgary. The nurse was concerned the physicians were using the nurses to “shuttle files back and forth”. The physicians who worked at the Siksika Nation were asked to pay for an individual to fill this role.

The physicians refused and the recommendation made by Siksika Nation was that the services of one of the physicians was no longer required. Following this decision all the physicians and the pharmacist left. [ 43 ] Mr. Redgun worked with a senior manager and a health committee who met with Health Canada to discuss recruiting new physicians and later hired Dr. Lash who was practicing out of Fort McMurray. Some time later Dr. Lash recommended Dr. Lavallee. Mr. Redgun met with Dr. Lavallee. Dr. Lavallee wanted to move to southern Alberta full time. He advised Mr.

Redgun that initially he could start part-time and after he wound down his practice he could start full-time work at the Siksika Nation. [ 44 ] Mr. Redgun testified that during his negotiations with the Plaintiff, the Plaintiff made the guarantee to stay until he retired. Mr. Redgun did not want the Plaintiff to use the position as a “stepping stone” and Mr. Redgun recommended the Plaintiff. He told the health committee that Dr. Lavallee had assured him that he would be with the Siksika Nation for a long time. The request was approved and Mr. Redgun was given the go-ahead to make an offer to Dr. Lavallee.

The parties agreed that the Plaintiff would be paid on a fee- for-service basis with Health Canada. [ 45 ] The offer was for four days a week. Mr. Redgun testified that he offered everything the Plaintiff needed at the Clinic. When the proposal was finalized and approved by the senior manager and the health committee, a letter was given to the Plaintiff. Mr. Redgun was instructed to offer Dr. Lavallee full access to the Clinic. At trial, Mr.

Redgun testified that the Plaintiff gave them a guarantee that he was going to be there for a long period of time and in return they offered him a position guaranteeing that he was going to be there for a “long period of time.” C. Mr. Melvyn Tyler White Junior [ 46 ] Mr White is a member of the Siksika Nation. After holding various positions at Siksika Nation he began to work as the Health Director and Service Area Manager for Siksika Health Services in 1999, overseeing the entire operations. He holds the same position today and he is now recognized as the Chief Executive Officer.

In 1999, he reported to the tribal manager and then to Chief in Council. The reporting structure has since changed and the role of tribal manager has gone through several changes. Currently, the Health Board has full governance authority. [ 47 ] According to Mr. White, in 1999, there was a lack of direction and leadership at the Clinic and it was dysfunctional. The staff included visiting professionals, Health Canada staff and Band staff. His job was to stabilize the Clinic’s operations and provide long-

range vision and planning. He worked hard to change the structure and develop relationships. [ 48 ] When Mr. White started as the Health Director there were several physicians on staff including the Plaintiff. They all had varying hours which frustrated Mr. White. The Plaintiff’s

schedule changed in the spring of 2004 and according to Mr. White, the impact on the Clinic was significant. [ 49 ] Mr. White testified that he was aware that Health Canada had concerns with nurses acting as nurse practitioners in the extended role. Nurse practitioners had been recognized on the Siksika Nation for years and it came as a surprise when they received the news from Health Canada that nurse practitioners could no longer provide the same services. Mr. White testified that they were “blind sided” when they received the news.

The nurses who chose to remain remained as community health nurses. [ 50 ] In 2005, the Clinic was actively trying to recruit physicians and nurses. The Clinic still employed Health Canada workers. Mr. White was in constant communication with Health Canada; he explained that it was the major funder and it was important that Health Canada be part of the process. [ 51 ] Mr. White was disappointed when the

article in Windspeaker came out. [ 52 ] Mr. White testified that he was not aware, initially, that the Plaintiff had hired his wife to help him at the Clinic. He understood that Dr. Crowshoe was also unaware of this. Mr. White testified that there was a protocol to be followed when hiring administrative staff which the Plaintiff ignored in bringing his wife to work at the Clinic. Further, he testified that he only had the ability to override the protocol when hiring essential services which did not include administrative staff. [ 53 ] Mr.

White disagreed with the Plaintiff’s assertion that Siksika Nation would incur no liability from his wife working at the clinic. He was receiving advice from Health Canada at the time respecting the advisability of confirming liability insurance covering Mrs. Lavallee confirming her license and training and securing an oath of confidentiality and security check for her. He agreed the issue could have been avoided had the Plaintiff approached him before bringing his wife to work. [ 54 ] Mr. White sent an e-mail message to Dr.

Crowshoe’s assistant on October 3, 2005 asking her to prepare a letter to the Plaintiff about unauthorized individuals working at the Clinic. He did not discuss the matter with the Plaintiff, stating that this was the responsibility of Dr. Crowshoe. [ 55 ] As noted above, Mr. White sent the Plaintiff two letters on October 11, 2005. His assistant placed the letters on the Plaintiff’s desk as he was not in his office at the time. When questioned why he did not take the dismissal letter himself he replied that he felt no need to deliver the letter. [ 56 ] According to Mr.

White, there was much concern from the staff about what was going on. The Plaintiff’s clinics were inconsistent at best and he was not making his regular clinic days. He noted the Plaintiff did not attend doctor meetings. However, Mr. White admitted that he did not discuss his absence or any of these issues with the Plaintiff. [ 57 ] One of the letters was the Plaintiff’s termination letter. It was discussed with employees from Health Canada, the tribal manager and the Chief at the time. At no time, did Mr.

White have any discussions with the Plaintiff about the letter. [ 58 ] Mr White’s second letter of October 11, 2005, asked the Plaintiff to refrain from bringing his wife to work to provide administrative and nursing support. This letter was drafted with Dr. Crowshoe’s assistance. He acknowledged that he had consulted with legal counsel. In fact, during examinations for discovery he testified that it was a letter prepared by legal counsel. He does not recall when he obtained legal advice on the letter but did agree that it would have been before October 11, 2005. [ 59 ] Mr.

White agreed that he was aware the Plaintiff and Dr. Crowshoe were corresponding and Dr. Crowshoe wrote a letter, dated October 11, 2005 which closed by stating “I believe that working together we can all help to provide quality treatment . . . for

Siksika Nation Members.” [ 60 ] Mr. White received the Plaintiff’s response on October 14, 2005. He discussed it with Dr. Crowshoe and updated the tribal manager and the Chief. He did not respond to it. He admitted that he also received a copy of the second letter dated October 14, 2005. [ 61 ] On October 20, 2005, he discussed the Plaintiff’s letter, dated October 19, 2005, addressed to Fred Rabbit Carrier, Tribal Manager with Mr. Rabbit Carrier. Mr. White did not receive a copy of this letter. Until he had the discussion with Mr.

Rabbit Carrier, he was not aware the Plaintiff was “choosing” to leave on October 19, 2005. [ 62 ] Mr. White testified the Plaintiff’s wife continued to come into the Clinic until October 19, 2005. He recalled security being involved and his explanation was that there were “unauthorized” individuals on the premises and this was standard operating procedure. Mr. White directed security to advise the Plaintiff and his wife to leave the building. Mr. White did not come out and stayed in his office even though it was approximately 75 feet away. [ 63 ] Mr.

White was aware of the letter sent to the Plaintiff on November 7, 2005 requesting a meeting with the Plaintiff. In his view, they needed to settle the issue of the continuity of care of the patients. [ 64 ] Mr. White was aware of the letter sent to the Plaintiff on May 5, 2006 from Chief Adrian Stimson confirming the termination but stating the Plaintiff would be welcome on the Siksika Nation as a member of the public. [ 65 ] On cross-examination, Mr. White confirmed that he did not have any conversations with the Plaintiff about the terms on which he was hired.

He never did a supervisory evaluation with the Plaintiff. He did not confirm the terms of the arrangement the Plaintiff was brought in under. [ 66 ] Mr. White recruited Dr. Crowshoe in 2002. He had just graduated from medical school and was around 35 years old. In 2005, Dr. Crowshoe was acting as the “medical lead”. D. Dr. Lynden Crowshoe [ 67 ] Dr. Crowshoe graduated from medical school in 1995 and is a family practitioner. He has worked at various reserves over the course of his career including the Alexander, the Hobbema and Fort Chippewan reserves.

He participated in development of medical education about fetal alcohol syndrome and sat on a drug utilization review board, which attempted to address the issue of narcotics in the aboriginal community. Dr. Crowshoe has been a professor at the University of Calgary since 2000. Currently, he works half-time at the University of Calgary and half-time at a Clinic. He started working at Siksika Nation around 2003 to fulfil the half-time clinical commitment. [ 68 ] When Dr. Crowshoe started, Dr. Lavallee worked three days a week and Dr. Crowshoe worked two days a week. Dr.

Crowshoe increased his days in November or December 2005 to three days a week after Dr. Lavallee left. Dr. Crowshoe then recruited an additional two doctors and cut his days back again. Before Dr. Lavallee left, he had told Dr. Crowshoe that he wanted to cut back his time at the Siksika Nation and spend more time doing pilot aviation medicals. [ 69 ] Dr. Crowshoe agreed that there was tension between the doctors and the community nurses. The community nurses did not support the doctors. This complaint was also made by Dr. Lavallee. According to Dr.

Crowshoe, as a result of the conflict, the nurse practitioners and the extended care nursing staff services were ended by Health Canada. The nurse practitioners and the extended care nursing staff had authority to provide services to patients that could not be provided by regular nurses. The role was supervised by Health Canada. At the time, though, the nurse practitioner was not helping the doctors by doing any pre-assessments of the patients. However, he disagreed with Dr.

Lavallee’s assertion that there were often too many nurses on site; he thought there were often not enough. [ 70 ] As a doctor, he was autonomous but had responsibilities to maintain his practice and as medical team leader he reported to the

Health Board. He stayed in close contact with Mr. White but did not officially report to him. Physician services were within Dr. Crowshoe’s domain. Nursing services and budgetary concerns were within Mr. White’s domain. [ 71 ] Dr. Crowshoe recalled receiving the letter that told Siksika Nation that no nurses were to work in the expanded role until further notice. This significantly impacted the Clinic as the nurses offered complementary services to the doctors. The nurses who were still at the Clinic did not agree to support Dr. Lavallee. [ 72 ] In 2005, Dr.

Crowshoe provided clinical services and acted as a team leader. In the latter part of 2005, Dr. Lavallee brought his wife into the Clinic. Dr. Crowshoe does not recall exactly how he was told but thought it was likely through a meeting with Mr. White. He knew nothing about Dr. Lavallee’s wife then. [ 73 ] To the best of Dr. Crowshoe’s recollection Mrs. Lavallee was brought in as a clinic nurse. He explained the role of the clinic nurse was that she would see the patient before the appointment with the doctor, take vitals etc. The clinic nurse would then help the doctor if any further prep was needed. [ 74 ] Dr.

Crowshoe confirmed that he received a copy of the Plaintiff’s termination letter, from Mr. White and that he was aware that this letter was going to be delivered. [ 75 ] Dr. Crowshoe wrote a letter to the Plaintiff on October 11, 2005. He did not recall if he discussed this letter with anyone. In his view, the main unresolved issue was that the Plaintiff had brought in an unauthorized individual, his wife. He still had hopes of resolving the issue and asked his assistant to book a meeting. The only opportunity that he had to speak with the Plaintiff was in the hallway. [ 76 ] Dr.

Crowshoe was not aware the Plaintiff was abruptly ending his services on October 19, 2005. He tried to find some times to meet with Dr. Lavallee and sent him a letter on November 7, 2005 to this effect. The meeting did not take place. [ 77 ] Dr. Crowshoe agreed that he knew by Friday, October 7, 2005 that Dr. Lavallee’s services were to be terminated. He agreed that he wrote the October 11, 2005 letter to Dr. Lavallee which by all appearances appeared to try to resolve some of the issues. Dr. Crowshoe testified that had he known that Dr. Lavallee had been terminated he would not have written this letter.

I find his evidence on this point curious. By his own admission he agreed that he met with lawyers more than once before October 17, 2005. Further, Mr White testified that he had met with legal counsel before October 11, 2005. Dr. Crowshoe admitted to being at more than one of these meetings. Logically, it makes sense that at least one of these meetings took place before the termination letter was drafted and that Dr. Crowshoe was aware of Dr. Lavallee’s termination before writing the letter on October 11, 2005. V. Parties’ Positions A.

Plaintiff’s Position [ 78 ] The Plaintiff submitted that it is clear in this case that the parties intended to create a fixed term contract which was to be in effect until the Plaintiff retired at age 70. The Plaintiff argued that if the Statute of Frauds makes the contract unenforceable, the existence of the fixed term contract should still be considered when deciding the period of reasonable notice. B. Defendants’ Position [ 79 ] The Defendants denied any agreement that bound the parties for the balance of the Plaintiff’s working life.

They maintained that the arrangement between them could have been terminated by either party on reasonable notice. Siksika’s position is that it acted under the agreement by providing the Plaintiff with reasonable notice. It denied that it breached the Plaintiff’s contract, as alleged or at

all. [80] Further, the Defendants submitted that if this court finds there was a fixed term contract, then the Statute of Frauds wouldmake it unenforceable. [81] The Defendants submitted that the Plaintiff gave no evidence at trial to support the alleged claims for breach of representationand unlawful interference with contractual relations seeks no relief for them in the trial brief. As a result, the Defendants argued theclaims should be dismissed. VI. Analysis 1.

Did the Plaintiff and the Defendants enter a fixed term contract? [82] Both parties relied on cases involving an employment relationship as they both agreed that although the Plaintiff was not anemployee of Siksika Nation, at times the relationship resembled an employment relationship. To prove a fixed term employmentcontract, the case law is clear the language must be “unequivocal and explicit”: Ceccol v. Ontario Gymnastics Federation (2001), (ON CA), 55 O.R. (3d) 614 at paras. 26-27 (C.A.). [83] The Plaintiff relied on Vondette Port Corporation v.

Vancouver Port Corporation (1987), (BC SC), 21B.C.L.R. (2d) 209 (S.C.) in support of the argument that the courts have upheld fixed term contracts where oral evidence shows a clearintent to create a fixed term contract. In Vondette, the plaintiff moved from Halifax to Vancouver to accept a position of harbour master.He was terminated from his position six years later and argued that his employment contract was for a fixed term, namely, until hisretirement age of 65.

The man who hired him testified that he told the plaintiff he could expect to serve until age 65, and further, incross-examination, he said that because of special circumstances surrounding the plaintiff he was hired on the basis that he could serveuntil the mandatory retirement age. The Court found, at 211, there was a fixed term contract until his retirement at age 65. [84] The Defendants argued that Canadian courts have shown hesitancy in finding fixed term employment contracts, particularlyfor contracts allegedly lasting until retirement.

The Defendants relied on Foreman v. 818329 Ontario Ltd. (2003), (ON CA), 229 D.L.R. (4th) 385 at paras. 19-20 (Ont. C.A.), leave to appeal refused, [2004] 1 S.C.R. ix 234 where the terminatedemployee argued that she had been guaranteed a position for life in her employment contract. The contract included a clause that statedthe employer “shall not dismiss Anne Marie”. The Court confirmed that lifetime employment, while legal, sometimes even desirable,nonetheless requires even clearer articulation, given the profound financial responsibility of such a guarantee.

In this case there was noexplicit language and the evidence disclosed that the parties were trying to protect the employee from dismissal through a change inmanagement and not the rest of her life which in my view distinguishes Foreman from the present case. [85] In Nicholls v. Richmond (Township), (BC SC), [1984] 52 B.C.L.R. 302 (S.C.) the Court held that although,probably both parties when making the contract expected the employee would stay with the municipality to retirement age, they made noagreement, express or implied, to that effect.

In finding the agreement did not amount to a fixed term contract, the Court noted there is adifference between a vague expectation and a binding contractual term. [86] In Johnson v. Global Television, 2008 BCCA 33, the employment contract required retirement at 65.The plaintiff argued thathe was told he was entitled to a fixed term of employment for life if he wished. The Court found that employment for life requiresexplicit, unequivocal articulation (at para. 44). [87] In Toole v. Acres Inc. (2007), (ON SC), 30 B.L.R. (4th) 133 at para. 31 (Ont. S.C.J.), the employee had noformal contract of employment.

The employee testified that he was led to believe that he would remain as president until he reached theage of 65. The Court found there was no contractual commitment for a fixed term of employment. Also the terms of employmentimplicitly included the qualification that continued employment was dependant on what was seen by the board of directors of SGI to bein the best interests of the corporation.

[88] The Defendants submitted that if a fixed term cannot be proved what remains is an agreement for an indefinite term whichmay be terminated on reasonable notice: Foreman v. 818329 Ontario Ltd. at para. 22. [89] Mr. Redgun testified the Plaintiff was willing to give the Siksika Nation a long-term commitment and had offered to providethe Clinic with his services until he retired. The Plaintiff testified that it would have taken a “team of horses” to get him out of FortMcMurray and he wanted a specific commitment from the Band before moving to Strathmore.

Those commitments included a fixed termcontract, given the Plaintiff’s age at the time, being 50 years old, providing that he would work until the age of 70 years old; that thePlaintiff would work four days a week in the Health Clinic on the Reserve, and that the Plaintiff would be provided with access to theClinic with all expenses associated with his practice at the Clinic paid for by the Band. [90] The Defendants offered no evidence to the contrary about the terms of the Plaintiff’s employment with the Band. In fact, theonly evidence about the contract comes from the Plaintiff and Mr. Redgun.

I accept the Plaintiff’s evidence that he offered to work at theBand until he retired, that Siksika accepted his offer and in return guaranteed a position on the Siksika Nation until he retired. Further, Iaccept the Plaintiff’s evidence that it would have taken a “team of horses” to get him to leave Fort McMurray and he was looking for anassurance that he could work at the Clinic until he retired. Mr. Redgun took those terms back to the Band Council and they agreed tothose terms. [91] I find there was a clear articulation of the terms of this relationship.

Both parties who were present at the time agree whathappened. Like Vondette, this court “cannot fly in the face of that unchallenged evidence unless there is very, very good reason in theproven circumstances to do so” (at 211). It is clear on the evidence from both the Plaintiff and Mr. Redgun that at the time the contractwas made the intention of the parties was to create a fixed term contract that would be in place until the Plaintiff retired. This was not avague expectation but a binding contractual term. 2.

Does the Statute of Frauds make the relationship unenforceable? [92] The Defendants submitted that even if this court finds a fixed term contract, the agreement is made unenforceable by theStatute of Frauds, (1677), 29 Car II, c.3. s.4, (U.K) (the “Statute of Frauds”). The Plaintiff agreed that

section 4 of the Statute of Fraudsmay make the fixed term contract unenforceable. However, the Plaintiff argued that despite the unenforceability of the contract, bothparties’ understanding of the terms of the contract must be considered, which significantly increases the required notice period. [93]

Section 4 provides in part: 4. . . . no action shall be brought whereby to charge any executor or administrator upon any special promise to answer damages out of hisown estate;. . . or upon any agreement which is not to be performed within the space of one year from the making thereof; unless theagreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, and signed by the party tobe charged therewith, or some other person therunto by him lawfully authorised. [94] Most common law jurisdictions have adopted the provisions of the Statute of Frauds.

It requires contracts for the sale of landto be in writing and signed by the party to be charged. In Alberta, the original English statute is in force. Under the Statute of Frauds acontract not to be performed within a period of one year from its making must be in writing. Case law confirms that the Statute of Fraudsapplies to employment contracts and those contracts that are for a term greater than one year and not in writing will be unenforceable. Asa result, it is arguable that an action for wrongful dismissal cannot be sustained if based on a contract that does not comply with theStatute of Frauds: Smith v.

Mills (1913), 6 Sask. L.R. 181 (S.C.); McKay v. St. Joseph’s Hospital Board (1921), (NSCA), 56 D.L.R. 581 (N.S.C.A.), Sherman v. Monarch Chrome Furniture Co. Ltd. (1958), (ON CA), 15 D.L.R. (2d) 6.(Ont. C.A.). [95] The effect of the Statute of Frauds has been heavily criticized and there has been much reluctance, by the courts, to enforcethis particular provision: 171817 Canada Inc. (c.o.b.) Arctic Sunwest Charters) v. Fores, [1998] N.W.T.J. No. 165 at para. 37. Theobject of the Statute of Frauds was to prevent fraudulent oral agreements by which parties may be bound for their entire lives.

Clearly,the Statute of Frauds was intended to be directed at cases which differ from the present case. Here the trial evidence confirms theexistence and specifics of an oral agreement. The Defendants have failed to present any evidence challenging the existence of thisagreement. Further, there are no allegations of fraud or perjury.

[96]

Section 4 or its equivalent has been held not to apply to an indefinite period of hiring or a hiring for “life” which wasterminable by the employee at any time. In Annand v. Peter M. Cox Enterprises Ltd., (1992) (NS SC), 111 N.S.R.(2d) 196 (S.C. T.D.), the court stated at para. 30: In so concluding, I follow Jordan v. Acadia Dairy Co. (1970), (NS SC), 2 N.S.R. (2d) 92, where Gillis, J., afterfinding the oral contract of employment to be for an indefinite period, decided such a contract does not fall within the Statute of Frauds. Ialso refer to Campbell v.

Business Fleets Limited, (ON CA), [1954], O.R. 87, a decision of the Ontario Court ofAppeal. In that case, the trial judge held that an oral contract for life fell within the Statute of Frauds which effected a complete bar torecovery. Both the employer and employee agreed that permanency of employment was assured to the employee and that it would be forlife. The Appeal Court decided that where the contract is such that the whole may possibly be performed within a year and there is noexpress stipulation to the contrary, the Statute of Frauds does not apply.

The employee could terminate his employment at any timewithin the space of one year and further, the employee's life might or might not be for a period of one day, one month, one year or twentyyears. [97] In Campbell v.

Business Fleets, [1959] O.R. 87 (C.A.), the Court held that a contract for life did not fall within the Statute ofFrauds for the following reasons at para.14: In the case at bar, in accordance with the findings of the learned trial judge, the agreement was to continue in force as long as theplaintiff was satisfied with the salary and bonuses, but if not so satisfied the plaintiff could terminate the employment at any time.Therefore, the plaintiff could terminate his employment within the space of one year.

Moreover, the contract (if there was nowrongdoing on the part of the plaintiff, and such wrongdoing was not suggested) was to continue for his (the plaintiff'

s) life which mightor might not be for a period of one day, one month, one year or twenty years. It is to me manifest that this contract must have come to anend at any time the plaintiff was not satisfied with his salary and bonus or on the death of the plaintiff, which might or might not bewithin the year: Glenn v. Rudd (1902), 3 O.L.R. 422. [98] The result is that where no definite term of employment is set, or where a term of one year or less is agreed, an oral contract isvalid and enforceable. No written contract is necessary.

However, if it is for a fixed term and cannot be performed within the year, thecourts have generally held it to be unenforceable. [99] For example, in McKay the plaintiff brought an action for wrongful dismissal on a two-year oral agreement that wasterminated before two years. The trial judge in McKay refused to dismiss the action on the basis of non-compliance with the Statute ofFrauds, and the jury found in the plaintiff’s favor on the wrongful dismissal action.

However, the Court of Appeal overturned the trialdecision on the basis the Statute of Frauds “raises an insuperable defence” and that the agreement sued on was not in writing as requiredby the Statute. [100] In my view, by the Plaintiff’s own evidence, which I accept, the contract was intended to be in effect until age 70, a time periodof about twenty years, placing it within the definition of a definite period of time and therefore is made unenforceable by the Statute ofFrauds. Despite this, the contract itself is still significant.

The fact is there was no contrary evidence and clearly no fraudulent behaviour. [101] In Erlund. v. Quality Communications Products Ltd. (1972), (MB KB), 29 D.L.R. (3d) 476 (Man. Q.B.), theparties entered a three year contract for employment, however the parties were unable to reach an agreement on the written terms ofemployment. The oral contact for employment therefore did not comply with the Statute of Frauds.

Consequently, the Court found thatthe three year contract was unenforceable; however, it nevertheless held that the plaintiff was entitled to a period of reasonable noticeand ordered damages in lieu of three months reasonable notice. [102] In support of its decision to order reasonable notice the Court in Erlund cited the English Court of Appeal case of James v.Thomas H. Kent & Co., Ltd., [1950] 2 All E.R. 1099. James also involved a three-year oral contract for employment that wasunenforceable because of the Statute of Frauds.

In James at 1103, Lord Denning held that where an employment contract is madeunenforceable by the Statute of Frauds, a general employment remains that is “not caught by the statute, in which it is always impliedthat it is only determinable by reasonable notice”. [103] Erlund and James show that a contract that does not comply with the Statute of Frauds cannot be enforced; however, a generalemployment contract remains despite the unenforceability of the original contract. It is on this general contract that reasonable notice canbe implied. Erlund is referred to by the Supreme Court of Canada in Machtinger v.

HOJ Industries Ltd., (SCC), [1992]

1 S.C.R. 986. In Machtinger the Supreme Court addressed the effect of a term that was null and void, and distinguished this from Erlundwhere the contract was entirely void by reason of the Statute of Frauds. The Court noted at 1001 that in Erlund: “Wilson J. held that inthe absence of a valid contract, he had no choice but to imply a term that the employee was entitled to reasonable notice”. The Court didnot comment on the validity of the decision in Erlund. [104] In Brendon v. Kellogg Salada Canada Inc. (1989), 24 C.C.E.L. 179 (Ont. Dist.

Ct.) the Court noted at 185 that the fact that thecontract is unenforceable pursuant to the Statute of Frauds does not mean that the contract is void. In other words, it does not mean thatthe Court cannot recognize the reality of its existence when determining what is reasonable notice. What is reasonable and fair is the test. [105] The doctrine of part performance does not apply to contracts of personal hiring and is confined to cases involving landcontracts: Brendon at 185.

In Brendon, the court also noted that estoppel may defeat the Statute of Frauds, however as estoppel was notargued or explored before him he did not resort to this option. [106] In conclusion, although this contract is not in conformity with the Statute of Frauds, because both parties understood that thiswas a contract until the Plaintiff retired at age 70, the reasonable notice requirement must reflect this understanding. 3.

What was the nature of the relationship between the Plaintiff and the Defendants? [107] As I have found that a fixed term contract between the parties is unenforceable the exact nature of the relationship between theparties is important. When a contract of employment is entered for a fixed term the calculation of damages is based on the unexpiredportion of the contract.

However, as there is no fixed term contract what remains is damages for reasonable notice. [108] The parties agreed the Plaintiff was never an employee of the Defendants and further agree that various facets of therelationship between the Plaintiff and the Defendants resembled employment at times. Therefore, it is not necessary to review the test asto whether or not the Plaintiff was an employee or an independent contractor. It is clear he was not an employee. However, it is necessaryto examine whether the relationship fell somewhere between the two on the continuum. In Slepenkova v.

Ivanov (2007), C.C.E.L. (3d)303 (Ont. Sup. Ct. Just), [companion case varied on other grounds] 2009 ONCA 526, 74 C.C.E.L. (3d) 163, the Court classified thisintermediate level as a dependent contractor relationship. In determining whether the plaintiff was a dependent contractor, the Courtnoted that the plaintiff was in an exclusive relationship with the defendant, the relationship was of some permanence and the plaintiffwas subject to considerable control by the defendant. [109] In Marbry v.

Avrecan International Inc., 1999 BCCA 172, Braidwood J.A., writing for the majority, recognized that there areincreasingly complex employment relationships and identified the following non-exhaustive factors to consider in determining where aparticular relationship sits on the continuum between an employee/employer relationship and independent contractor/strict agency:duration/permanency of the relationship; degree of reliance of the relationship and degree of exclusivity. Braidwood J.A. noted that thedegree of exclusivity need not be 100 percent. [110] In JKC Enterprises Ltd. v.

Woolworth Canada Inc., 2001 ABQB 791, 300 A.R. 1, the plaintiff provided trucking services to thedefendants. After 16 years of service the defendants without prior notice ceased using the plaintiff’s services. Justice Coutu cited Carterv. Bell & Sons (Canada Ltd.) (1935), (ON CA), [1936], 2 D.L.R. 438 (Ont C.A.) which introduced a new “intermediate”class of cases noting that the permanency of the working relationship was a significant factor in classifying the relationship asintermediate.

Justice Coutu then reviewed post-Carter cases noting that the authorities established that there is a broad range of criteriathat must be established in determining the true character of the relationship. Justice Coutu classified the employment relationship as anintermediate relationship and noted that rigid adherence to labels may lead to inequity. She stated at para. 78: The courts have come to realize that sometimes the parties relationship is neither that of employer/employee or employer/independentcontractor. Rigid adherence to labels may lead to inequity on the facts of a particular case.

In fact, sometimes this label is rejected if it isclearly inconsistent with the substance of the relationship. Some relationships fall in the intermediate category and in such circumstances,an agreement to terminate the contract on reasonable notice is implied. [111] In my view, the facts here support the finding of a relationship are closer to that of employee/employer than of an independent

contractor. The Plaintiff clearly had a long term relationship with the Defendants. He had worked at the Clinic for ten years and wasunder the impression that he would be there for another ten years. He worked out of and used all the supplies at the Clinic. Further, herelied on the nurses at the Clinic. In other words, he had no overhead. Initially, his relationship with the Defendants was exclusive,although he later set up another practice in Strathmore. This factor alone does not operate to negate the employee/employer likerelationship that existed at the time.

The Plaintiff’s relationship with the Defendant fell into the intermediate category. He is entitled to areasonable notice period. 4. Was the Plaintiff provided with reasonable notice? [112] The Plaintiff argued that if I decide the agreement is not a fixed term contract, then the Plaintiff is still entitled to a reasonablenotice period greater than the three months working notice that was offered.

Having found that the Plaintiff’s relationship with theDefendants is an intermediate relationship as opposed to that of an independent contractor, I find that he is entitled to reasonable notice. [113] Reasonable notice of termination was addressed in Bardal v. The Globe & Mail Ltd. (1960), (ON SC), 24D.L.R. (2d) 140 (Ont. H.C.) at page 145: There can be no catalogue laid down as to what is reasonable notice in particular classes of cases.

The reasonableness of the notice mustbe decided with reference to each particular case, having regard to the character of the employment, the length of service of the servant,the age of the servant and the availability of similar employment, having regard to the experience, training and qualifications of theservant. [114] The Bardal factors were adopted by the Supreme Court of Canada in Machtinger and recently affirmed in Honda Canada Inc.v. Keays, 2008 SCC 39, [2008] 2 S.C.R. 362 at paras. 28-32.

The Bardal factors have not been interpreted as exhaustive: Wallace v.United Grain Growers Ltd., (SCC), [1997] 3 S.C.R. 701 at para. 82. It was further confirmed in Honda Canada, atpara. 29 that reasonable notice can only be determined on a case-by-case basis. [115] The Plaintiff argued that inducement is a factor which affects the length of notice. I find the Plaintiff was induced to leave FortMcMurray, to sell his practice, and to relocate his family a considerable distance. Clearly, it was a big move.

However, I agree with theDefendants that when the employee then works with the employer for a long time inducement becomes a less significant factor: Hortonv. Rio Algom, (ON SC), [1995] 9 C.C.E.L. (2d) 180 (Ont. S.C.J. (Gen. Div.). Here, the Plaintiff remained in therelationship for ten years. Therefore inducement does not factor largely into the calculation of reasonable notice. [116] The Defendants argued that as a medical practitioner, the Plaintiff’s skills were easily transferable and alternative positionswere readily available to him. The Defendants relied on the case of Ditmars v. Ross Drug Co.

Ltd. (1970), (NB KB),3 N.B.R. (2d) 139 (N.B.Q.B.) where a 70 year old pharmacist was terminated after 18 years of employment. The Court held that despitethe plaintiff’s age and length of service his chances of re-employment were high, warranting a relatively brief notice period. Thepharmacist was awarded three months notice. The evidence showed that he was almost immediately able to get similar employment. TheDefendants also relied on Thomson v. Bechtel (1983), 3 C.C.E.L. 16 (Ont.

S.C.) where the Court noted that the dominant purpose of thenotice period is to enable the terminated employee to obtain other employment: see also Bramble v. Medis Health & PharmaceuticalServices Inc. (1999), (NB CA), 214 N.B.R. (2d) 111 at para. 57. [117] The Defendants submitted that opportunities for family doctors in rural settings are plentiful. Further, the Defendants arguedthat the Plaintiff should have secured a position on a reserve earlier than October 2006.

The Defendants submitted a document whichlisted Health Centres on reserves through the province and argued that there were many opportunities which were not explored by thePlaintiff. [118] I accept the evidence of the Plaintiff on this point that he was interested in working on a reserve which was both close to homeand had a significant population. Further, it was difficult to determine from the document, presented by the Defendants at trial, the natureof the health centre on each of the listed reserves.

It was not clear if there were actually physicians working on any of these reserves.Further, during testimony, the Plaintiff indicated that he was hopeful that the situation on the Siksika Nation would be resolved and hewould be reinstated. It was not until May 10, 2006, when he received the letter from Chief Stimson that he realized he would not berehired at Siksika Nation. The Plaintiff had contacted Hobbema Reserve at this point and was told there was an opportunity for aphysician. The details did not get sorted out until September 15, 2006.

As there were limited opportunities within a reasonablegeographic location and a reserve with a significant population. I accept that the Plaintiff took reasonable steps to mitigate his damages.

[ 119 ] When the Plaintiff began his employment at the Siksika Nation he was already over 50. He was seeking a long term position. When he was terminated, he had been working at the clinic for 10 years. He had the longest tenure of any of the doctors. He enjoyed working at Siksika Nation, that is, until the staff and supply shortage became critical. [ 120 ] I disagree with the Defendants that the Plaintiff should have worked through his three month notice period. It would have been impossible for the Plaintiff to continue to work on the Siksika Nation after he had been terminated.

The evidence established that he had been threatened with banishment from the Siksika Nation, Mr. White made little to no effort to communicate with him and at one point, security guards were sent by Siksika Nation to escort the Plaintiff and his wife from the premises. I do not accept the Defendants’ argument that the Plaintiff was “welcome through that time and it was strictly his wife’s attendance pending proper approval which was problematic.” I find that the Plaintiff could not have worked on the Siksika Nation after October 19, 2005.

Damages should be calculated from this point. [ 121 ] After hearing the evidence at trial, I find the Plaintiff adequately mitigated his losses. He was interested in working on a reserve and he was unable to secure this employment until he got employment with the Hobbema reserve in September 2006. [ 122 ] Finally, in assessing the notice period I note the intention of the parties was there was to be a fixed term contract in place. Although the contract was not in conformity with the Statute of Frauds I find the existence of the contract and the intention of the parties cannot be ignored. I hold that Dr.

Lavallee should have received reasonable notice of twelve months: October 19, 2005 to October 19, 2006. Expert Testimony [ 123 ] The Plaintiff presented expert testimony and reports from Mr. Gerry Taunton of PETA Consultants Ltd. respecting the quantum of the Plaintiff’s breach of contract claim. The Defendants presented expert testimony and a report from Mr. Scott Schellenberg of Matson Driscoll & Damico Ltd. [ 124 ] The Plaintiff enjoyed an income tax exempt status for income earned on an Indian reserve. He now pays tax on his earnings in Strathmore but not on the Hobbema Reserve. [ 125 ] Mr.

Taunton calculated the Plaintiff's expected earnings based on his average income in the five years before being terminated (1999-2003). The actual income earned by the Plaintiff in the years from 1999 to 2003 was adjusted to 2005 dollars and an average of these years was determined. The average was used to calculate what the Plaintiff would have earned from 2004 to 2009 had he continued working the same amount, and not been terminated. However, during the five year period from 1999 to 2003 the Plaintiff was working four days a week on the Siksika Nation; as a result, the average income used by Mr.

Taunton was based on the Plaintiff working four days a week and not two days a week the Plaintiff was actually working before his termination. [ 126 ] At trial, defense counsel took issue with Mr. Taunton's report including: 1. The failure to deduct expenses from the yearly income of the Plaintiff in the years from 1999 to 2003 which were used to calculate the five year average income for the Plaintiff. 2. The values used to calculate the Plaintiff's actual income in 2007 and 2008, differed from the values of the Defendants’ accountant. 3.

The 2009 values were calculated using values that were current only until November 29, 2009, and not the whole 2009 year. 4. The damages were based on the Plaintiff working 4 days a week on the Siksika reserve, whereas in October 2005 before being

dismissed the Plaintiff only worked two days a week. [127] On the first point, failure to deduct expenses, Mr. Taunton admitted that he erred by not adjusting for expenses the Plaintiffwould have incurred from 1999 to 2003. [128] On the fourth point, I am unable to calculate the damages based on a four day a week loss for two reasons. First, I am notpersuaded that the Plaintiff’s decision to work two days a week was due to unsafe conditions at the Clinic including a shortage of staffand supplies.

I am not satisfied conditions were unsafe nor do I understand why working two days rather than four days would improvesafety. Second, when asked at trial why he did not increase his working days at the Hobbema Reserve he initially testified it was due tofunding issues on the Hobbema Reserve. Later it became clear that the Plaintiff did not approach Hobbema as he was not interested inincreasing his days from two days per week. He was satisfied with his work arrangement in Strathmore and did not wish to leave hispractice.

Therefore I find that the damage calculations should be based on two days per week. [129] Points two and three are now irrelevant as I find that the notice period only extended to 2005. [130] Because of the error on expenses and because Mr. Taunton based his calculations on the incorrect assumption the Plaintiff wasworking four days a week, I accept the calculations of Mr. Schellenberg in

Schedule 1 of his Expert Report. From October 2005 toOctober 2006 he calculated the loss to be approximately $92,449.23. I accept this figure and award this amount of damages to thePlaintiff. [131] I should note that had I found the fixed term contract was enforceable, damages would have been almost identical with thereasonable notice period. Despite the existence of a fixed-term contract, the Supreme Court has confirmed a duty to mitigate: Wells v.Newfoundland, (SCC), [1999] 3 S.C.R. 199.

In my view, the Plaintiff had fully mitigated when he obtained the two daya week job on the Hobbema Reserve roughly 12 months after he was terminated from his position on the Siksika Nation. 5. Is the Plaintiff entitled to Wallace/Honda damages? [132] The Plaintiff claims the way he was dismissed entitles him to bad faith or Wallace/Honda damages. In Wallace v. United GrainGrowers, [1997] 23 S.C.R. 701 the Supreme Court held that an employee’s notice period may be increased to reflect bad faith conductby the employer.

This award of damages was clarified in Honda Canada, where the Supreme Court of Canada held that damages are onlyto be awarded if an employee proves the manner of dismissal caused mental distress beyond the normal distress resulting from dismissal.Further, the Court explains at para. 55 that the parties must have contemplated at the time of the contract that a breach in certaincircumstances would cause the plaintiff mental distress.

Justice Bastarache, writing for the majority stated further at para. 55: This principle was reaffirmed in para. 54 of Fidler, where the Court recognized that the Hadley rule explains the extended notice periodin Wallace: It follows that there is only one rule by which compensatory damages for breach of contract should be assessed: the rule in Hadley v.Baxendale. The Hadley test unites all forms of contractual damages under a single principle.

It explains why damages may be awardedwhere an object of the contract is to secure a psychological benefit, just as they may be awarded where an object of the contract is tosecure a material one. It also explains why an extended period of notice may have been awarded upon wrongful dismissal in employmentlaw: see Wallace v. United Grain Growers Ltd., (SCC), [1997] 3 S.C.R. 701.

In all cases, these results are based onwhat was in the reasonable contemplation of the parties at the time of contract formation. [Emphasis deleted.] [133] Further at para. 57, the Court described the type of circumstances when the award would be available: Damages resulting from the manner of dismissal must then be available only if they result from the circumstances described in Wallace,namely where the employer engages in conduct during the course of dismissal that is "unfair or is in bad faith by being, for example,untruthful, misleading or unduly insensitive" (para. 98).

[ 134 ] The Court noted that there was no longer any reason to retain the distinction between true aggravated damages resulting in a separate cause of action and moral damages resulting from conduct in the manner of termination. It is no longer appropriate to simply extend the notice period. Therefore, if the employee can prove that the manner of dismissal caused mental distress and the mental distress was in the contemplation of the parties at the time of the formation of the contract then an award should be made that reflects the actual damages.

According to the Supreme Court the beginning question is what was contemplated by the parties at the time of the formation of the contract or “as stated in para. 44 of Fidler ” “what did the contract promise?”. [ 135 ] Justice Lee recently addressed the issue in Elgert v. Home Hardware Stores Ltd., 2010 ABQB 65 (Q.B.) and summarized the required conditions that need to be met if damages for mental distress are to be awarded. He stated at para. 9: In Keays the Supreme Court revised its approach to an award of damages for manner of dismissal.

Now, there is no distinction between so-called Wallace damages and aggravated damages; both seek to compensate for mental distress suffered by the terminated employee. Under the revised approach, such damages are only available if the mental distress suffered meets the following conditions: - (

I) it is beyond the normal distress and hurt feelings that result from dismissal from employment; and (ii) it was within the reasonable contemplation of the parties at the time of contract formation that a breach of the contract in certain circumstances would cause the plaintiff particular mental distress. [ 136 ] Our Court of Appeal recently considered Honda damages in Merrill Lynch Canada Inc. v.

Soost, 2010 ABCA 251 and cautioned against awarding damages for the sole fact of the dismissal. [ 137 ] The Defendants argued that terminating an employee without prior feedback or warnings is not a relevant factor in the determination and on its own, that failure cannot amount to bad faith: McNevan v. AmeriCredit Corp. , 2008 ONCA 846 , 94 O.R. (3d) 458. I agree but as I will later discuss, lack of warning or prior feedback is not the only consideration in this case. [ 138 ] In Simmons v. Webb (2008), 84 C.C.E.L. (3d) 196 (Ont.

S.C.J.) bad faith damages on the principles enunciated in Honda were awarded seemingly without reliance on evidence beyond that of the plaintiff employee. In Simmons, a 20 year employee was abruptly fired by a letter which informed him of his termination and bluntly directed him to immediately remove his personal effects from the premises. The employer refused to return property of great sentimental value to the employee. The Court found the actions of the employer were insensitive, and lacked courtesy, respect and compassion. Failing to return the treasured property was mean-spirited, petty and insensitive.

Notably in this case the Judge awarded “moral” damages based on the Honda decision, but then declined to award damages for mental distress as there was no medical evidence to substantiate such an award thereby creating two separate causes of action. In my view, this rationale is confusing as Honda clearly states that: “ . . . there is no reason to retain the distinction between “true aggravated damages” resulting from a separate cause of action and moral damages resulting from conduct in the manner of termination.” (at para. 59). [ 139 ] In a recent Alberta decision, Chapell v.

Canadian Pacific Railway Co. , 2010 ABQB 441 , 29 Alta. L.R. (5th) 380 , Justice Erb found that the manner of dismissal of the employee caused mental distress. The Court found that the manner in which CPR dismissed the Plaintiff was unduly insensitive and unfair. After the employee was dismissed, a security officer was stationed outside the door for other employees to observe causing the employee great embarrassment. At trial, the Plaintiff testified as to depression although did not provide any expert medical evidence.

Notwithstanding the lack of medical evidence, Erb J. found there was enough evidence on which to decide the Plaintiff’s distress went beyond the normal hurt feelings associated with dismissal and determined that he should be awarded bad faith damages. [ 140 ] In Fox v. Silver Sage Housing Corp., 2008 SKQB 321 , 310 Sask. R. 179, the Court determined that the manner of dismissal was not candid, reasonable or in good faith.

Notwithstanding this determination, the Court denied the award of damages as a result of the manner of his dismissal and the plaintiff failed to prove that the stress and depression that he suffered was related to the manner in which he was treated. [ 141 ] In my view, the method of dismissal of the Plaintiff was a disproportionately severe response. It is undisputed that the Defendants sent a security guard to remove Dr. Lavallee and his wife from the Clinic. This was inappropriate. The Plaintiff had been a valued employee for ten years. He had received no warning or prior feedback about his performance.

Further, he found a short letter on

his desk terminating his position while he was in the middle of seeing patients. Mr. White did not try to communicate with him or deliver the letter personally. I find the manner in which Dr. Lavallee was dismissed was insensitive and lacked courtesy. [ 142 ] However, there is no evidence of any mental distress suffered by the Plaintiff. I am therefore unable to award Wallace/Honda damages. Case law after Honda has confirmed that Wallace/Honda damages should not be awarded if the employee does not prove actual damages flowing from the employer’s misconduct.

VII Conclusion [ 143 ] For the reasons outlined above, I find the Plaintiff is successful in his claim for damages for reasonable notice against the Defendants. The total damages award owing to the Plaintiff is $92,450.000 plus applicable interest. [ 144 ] The claim for Wallace damages is dismissed. [ 145 ] The claims for defamation, breach of representation or unlawful interference with contractual relations are dismissed. [ 146 ] The claim against Mr. Tyler White is dismissed. [ 147 ] Costs may be spoken to.

Heard between June 14 th and 21 st , 2010 Dated at the City of Calgary, Alberta this 2 nd day of February, 2011 P.J. McIntyre J.C.Q.B.A. Appearances: Frank Mason Mason Silver for the Plaintiff Leonard Polsky/Sarah M. Burton

MacPherson Leslie & Tyerman LLP for the Defendants