Karmel v Calgary Jewish Academy, 2015 ABQB 731

Court of Queen ’ s Bench of Alberta Citation: Karmel v Calgary Jewish Academy, 2015 ABQB 731 Date: 20151120 Docket: 1301 05064 Registry: Calgary Between: Benjamin Karmel Plaintiff - and - Calgary Jewish Academy Defendant _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice A.D. Macleod _______________________________________________________ Introduction and Issues [ 1 ] The Calgary Jewish Academy (CJA) terminated its Principal, Mr. Karmel, on February 25, 2013 for cause.

The reasons that the CJA argues amount to cause are listed in Appendix A to the Notice of Termination. They relate to issues of enrollment, the grade 4 class, the IPP process, communication style, the principal improvement plan, and technology. Other miscellaneous concerns include

denial of enrollment for children in August 2012, unprofessional behavior by staff, the teachers’ websites, not conducting exit interviews,scheduling personal vacation time, and the choice of paint colors for the school hallways. In other words, it relies on a wide range ofcauses. [2] Mr. Karmel was hired by the CJA while he was the head of school at the Richmond Jewish Day School in British Columbia.He was hired for a five-year term commencing August 1, 2006. On November 26, 2010, the CJA renewed his contract for another five-year term commencing September 1, 2011.

The agreement provided that the CJA could terminate Mr. Karmel for cause prior to theexpiry of the contract, and the reasons for termination were to be in writing. The main issue before me is whether the CJA had just causeto terminate the contract. If not, is Mr. Karmel entitled to punitive, exemplary or other damages in addition to that owing to him under thecontract? [3] The trial commenced November 24, 2014, and continued through that week and the following week. Argument concludedon December 19, 2014. [4] The parties agreed that the CJA would call its case first.

Its witnesses included a number of its Board members includingAdam Brener, Dr. Joshua Benjamin, Mr. Eric Kettner, Stan Eisenberg and Aviva Horwitz, as well as Audrey Goldfarb and Yossi Suissa. [5] In addition to Mr. Karmel, the Plaintiff called Ms. Karmel, Ms. Bondar, and Ms. Halpern. [6] Many documents were entered, most notably four binders of documents, Exhibits 14-17, which were consecutively tabbed. Iwill refer to those documents by referencing the tab number.

There were other exhibits as well, including an Agreed Statement of Factsmarked Exhibit 3. [7] It was CJA policy to evaluate its Director, Head of School or Principal, as Mr. Karmel was variously called, on a regularbasis. A review was done in May of 2008 and there was another scheduled for the summer of 2011. [8] Audrey Goldfarb of Minnesota conducted the latter evaluation. It is important to understand that the evaluation process wasintended to be a two way street.

It was a collaborative process in which the Principal and the executive or Board were to communicateand explore ways to improve the effectiveness of the Principal. The ultimate goal was to help make the school stronger. As Ms. Goldfarbtestified, this could not have been achieved from the “top down.” In order for the evaluation to be effective, it had to be a collaborativeeffort. She would not have done the evaluation if the Board had insisted on a “top down” approach. Furthermore, Ms. Goldfarbemphasized that the ongoing improvement plan established for the Principal had to be a collaborative effort as well.

The intention was tomaximize the opportunity for growth on the part of the Principal. [9] The fact that the evaluation process was not part of Mr. Karmel’s contract renewal emphasizes that the intent was to improvethe Principal’s effectiveness rather than to assess his suitability. Ms. Goldfarb also confirmed that it was important for the school to workcontinuously on its strategic plan. It was necessary that the school define itself in terms of its students and the Calgary Jewishcommunity it serves. [10] The 2008 evaluation of Mr. Karmel was complimentary. Mr.

Karmel is well qualified and has an excellent background. Byall accounts, he has always worked incredibly hard and was dedicated to the CJA. Indeed, the 2008 evaluation expressed concern aboutthe possibility of burn out. It also emphasized the importance of preserving the Principal’s time for leadership within the school, and tofree up the Principal as much as possible from more mundane tasks. The 2008 evaluation also recognized that the parents of the schoolwere often opinionated and sometimes difficult to deal with. My review of the evidence and testimony given at this trial confirms thatobservation.

I also note that this became more acute in the final two years of Mr. Karmel’s tenure. [11] The CJA is a day school that serves preschool to grade nine. In addition to an excellent academic education, the CJA alsooffers a traditional Jewish education. [12] Historically the school has faced many challenges, including reduced enrollment. Education for children in Calgary hasbecome very competitive. Not surprisingly, the CJA faces stiff competition from other private schools in the city, as well as publicschools.

CJA students go elsewhere for high school and often, prior to that, parents will put their children in alternative schools if theyfeel it will better prepare them for high school studies. For that reason, the CJA has had an Attraction and Retention Committee forseveral years. [13] As in many schools, an elected Board of volunteers oversees the CJA. The Board then elects one of their number as Presidentfor a two-year term. The Principal reports directly to the Board. It is essential to the school’s success to have a good workingrelationship between the Board and the Principal.

The Principal attends all the Board meetings and usually submits a comprehensivereport at every meeting. It is my observation from the evidence that, in the absence of a healthy relationship between the Board and thePrincipal, the school ceases to function effectively. The morale of the staff, Principal, students and parents declines. From the fall of 2011to Mr. Karmel’s termination in February 2013, it would be a gross understatement to say that the Principal and the President of the CJAdid not see eye to eye.

The relationship between the Board and its Principal became intolerable, and the morale of the CJA rapidlydeteriorated. Onus of Proof [14] The CJA must prove on a balance of probabilities that it had just cause to terminate Mr. Karmel without notice for disobeyingthe directions of the Board.

The following paragraph from Port Arthur Shipbuilding v Arthurs, (ON CA), [1967] 2 OR49, OJ 972 (Ont CA) at para 11 is a helpful passage on this subject: If an a employee has been guilty of misconduct, habitual neglect of duty, incompetence, or conduct incompatible with his duties, orprejudicial to the employer’s business, or if he has been guilty of willful disobedience to the employer’s orders in a matter of substance,the law recognizes the employer’s right to summarily dismiss the delinquent employee.

Is Just Cause Established? [15] The CJA argues that Mr. Karmel was wilfully disobedient in the face of reasonable demands by the Board on matters ofimportance. Accordingly, the CJA argues that just cause has been made out. [16] Howard A. Levitt in The Law of Dismissal in Canada, 2d ed. (Aurora: Canada Law Book, 1992) defines wilful disobedienceas defiance by an employee of a lawful and reasonable order that effectively repudiates the essential condition of the employmentrelationship; that employees must obey their employer's instruction.

Levitt goes on to set out ten elements required for insubordination toconstitute just cause for dismissal: 1. the order must be either clear and specific or must be a breach of policies and procedures well known by the employee; 2. the order must be within the scope of the employee’s job duties; 3. the order must be reasonable and lawful; 4. the disobedience must be both deliberate and intentional rather than resulting from an honest mistake as to whether the order wasstill in effect or under the reasonable belief that he was not contravening orders; 5. the order must involve some matter of importance; 6. unless the act of disobedience is particularly serious it has to be repeated, rather than be an isolated act of disobedience, in order toconstitute cause; 7. it must be shown that as a result of the disobedience the relationship was so damaged that it could not be carried on; 8. it must be shown that the employee understood or should have understood that he ran the risk of being terminated for disregardingthe order; 9. if there is a reasonable explanation for the disobedience it will not be cause for discharge; and 10. there will be more latitude shown to long-service employees.

Levitt’s principles were endorsed by this Court in Wilson v KP Manufacturers (Calgary) Ltd, (AB KB), 1998 225 AR 205, 60 Alta LR (3d) 333 (Alta QB) at paras 10-11. [17] In order for wilful disobedience to be just cause for termination, the employee’s behaviour must be “seriously incompatiblewith the employee's duties... conduct which goes to the root of the contract and fundamentally strikes at the employment relationship”:see Panton v Everywoman’s Health Centre Society (1988), 2000 BCCA 621, BCLR (3d) 364 at para 28. [18] Insubordination will constitute cause where the employer can establish that the employee wilfully violates a “clear andunequivocal” instruction or refuses “to carry out a policy or procedure well known by the employee to be central to the fulfilment of theemployer’s objectives”: see Panton at para 33. [19] For the reasons that follow, I find that Mr.

Karmel was in no way wilfully disobedient. The evidence does not establishdisobedience or insubordination; rather it demonstrates a lack of good faith on the part of the CJA. Just cause is therefore not made outand Mr. Karmel is entitled to damages. Narrative and Findings of Fact [20] The main protagonists in this case are the Plaintiff, Mr. Benjamin Karmel, and the President and Chair of the Board, Mr. EricKettner. They both gave evidence. Mr. Karmel impressed me at as a truthful witness. At the time of the trial, he was 61 years of age andhad a long history as an educator.

He received a Master’s in Education from the University of Calgary, and from 1993 to 2002 he taughtat the CJA. He then became Head of School at the Richmond Jewish Day School in British Columbia until he returned to the CJA asPrincipal. Mr. Karmel impressed me as being totally dedicated to the CJA and a very hard worker. He had definite ideas on many of theissues facing the school, and my assessment of him as a witness is in line with the comments of Mr. Burghardt, who had prepared thecomplimentary 2008 evaluation. [21] Mr.

Karmel knew the school and the issues facing it and had many sound ideas on how to manage those issues. Diplomatictalents were not his forte and he occasionally rubbed people the wrong way. Nevertheless, no one ever questioned his dedication to theCJA, his hard work or his qualifications to do the job. Moreover, he impressed me as a man of great integrity. But for this termination, Ithink he would have finished his career as an educator at a high level. [22] Mr. Kettner is an experienced businessman with a Bachelor of Commerce Degree.

He was first involved at the CJA in 2010-2011 school year as Treasurer, and became Chairman of the Board in the summer of 2011. He had no prior experience in running aschool, nor did he have any prior board experience. Of the fourteen members of the Board, five were new at the beginning of Mr.Kettner’s first term as Chairman and President. [23] Mr. Kettner impressed me as inflexible and controlling. He insisted upon a hierarchical structure of which he was the head.

He likened the school to a corporation, and his role to that of a Chief Executive Officer. This may work well in a commercial setting. It did not, however, work well at the CJA, where the Board is made up of volunteer members who must rely upon the Principal and the rest of the administration for their expertise in education. Furthermore, Mr. Kettner took parents’ complaints very seriously, and as a criticism of Mr. Karmel and his staff. He often took the parents’ side on issues and he invariably supported the Board parents when they had issues with Mr.

Karmel or his staff. [ 24 ] While the Principal reported to the Board, it is important that the Board benefit from the Principal’s experience and understand the Principal’s point of view on issues facing the school. In Mr. Karmel’s prior experience, that was the norm. i. August 2011 [ 25 ] While there is no evidence that Mr. Kettner and Mr. Karmel had any negative interaction prior to August 2011, on August 16 there was an unfortunate and, in my view, bizarre encounter between Mr. Karmel and Mr. Kettner. Mr. Kettner had not sought a meeting to discuss the CJA’s issues with Mr.

Karmel prior to that time. [ 26 ] Mr. Kettner called Mr. Karmel on August 16 and told him that some parents had expressed concerns regarding paint colours in the school hallways. Mr. Kettner was worried about the painting process. Mr. Karmel responded that this was not his area and that he would connect Mr. Kettner with the Building Superintendent and the Custodian who were responsible, so that Mr. Kettner could find out more about the process. [ 27 ] While Mr. Kettner did meet with the Superintendent and Custodian on August 16, he later complained to Mr. Karmel that there was no need for Mr.

Kettner to be at a meeting with them, and that he wanted to meet with the Principal and not with his staff. For reasons that I still cannot comprehend, there ensued an argument in which Mr. Karmel made the point that paint color was not part of his job nor was it Mr. Kettner’s responsibility. Tempers escalated and Mr. Kettner demanded of Mr. Karmel two or three times to stop speaking. He told him this was an example of his communication issues. Mr. Kettner claimed that Mr. Karmel then threatened to resign, to which Mr. Kettner replied, “if you put it in writing I will accept your resignation.” Mr.

Karmel’s version was that he said, “Are you trying to get me to resign?” He denies that he threatened to resign. I accept Mr. Karmel’s recollection of this event. Wherever Mr. Karmel’s evidence conflicts with that of Mr. Kettner, I accept the evidence of Mr. Karmel. [ 28 ] Mr. Kettner concedes that he lost his temper and had to cool off for some 30 minutes. This incident appears to have had a lasting effect on the relationship between Mr. Kettner and Mr. Karmel. I find Mr. Kettner’s behavior in this petty situation to be astonishing. Mr.

Karmel’s explanation that he left the paint colour decisions to others was perfectly normal and understandable. His attempt to put those in charge of paint in touch with Mr. Kettner was also understandable. Mr. Kettner’s reaction, however, was not. [ 29 ] Prior to the August 16 incident, a call with Ms. Goldfarb had been scheduled for August 17. Ms. Goldfarb was conducting the 2011 Principal evaluation. Most, if not all, of the previous conversations with Ms. Goldfarb were done in the presence of Mr. Karmel. On this day, however, the telephone conversation did not include him. During the call, Mr.

Kettner informed the participants that Mr. Karmel had threatened to resign over the paint colour issue. At this time, Ms. Goldfarb was told that Mr. Karmel had threatened to resign even though he had not. Faced with this news, Ms. Goldfarb suggested that Mr. Kettner might wish to consult an employment lawyer. Mr. Kettner contacted a lawyer that same day. [ 30 ] Two days later Ms. Horwitz, another Board member, and Mr. Kettner met with Mr. Karmel. This August 19 conversation was recorded without Mr. Karmel’s knowledge. Tab 32 is a series of talking points by Mr.

Kettner, as well as his rendition of the conversation between himself, Ms. Horwitz and Mr. Karmel. The evidence discloses that Mr. Kettner was successful in recruiting Ms. Horowitz to his position with regard to Mr. Karmel. i. 2011-2012 School Year [ 31 ] Tab 43 is a copy of Mr. Karmel’s state of the School address on September 22, 2011.

In this address he thoughtfully, in my view, reviews his ideas on enrollment, the budget, the climate of the learning community culture, analysis of the Fraser Institute Reports, and other matters relating to the CJA. [ 32 ] Following the address he asked the Board for feedback with respect to the new Ambassador Program. On October 1 he wrote directly to all of the executive members, enclosing a number of academic materials on various educational issues of general interest. In an email to Mr. Karmel of October 6, 2011, at Tab 66, Mr. Kettner expressed concern about Mr.

Karmel damaging the effectiveness of “my leadership and Board morale.” Mr. Kettner went on to say As I’ve stated to you previously, if there are any concerns about the Board as a whole they are to come to me directly and never to the Board as a whole until I have had a chance to reflect on them and bring them to the Board myself.

Your email to the Board members (after I asked you to take no further action) saying there is a group of Ambassadors that question their transparency, credibility and invisibility is a direct attack on my authority by [sic] Administration and cannot happen in the future. [ 33 ] There was clearly a clash in philosophy. Mr. Karmel believed that criticism should be shared openly among those concerned with the CJA’s governance. Mr. Kettner, on the other hand, espoused solidarity and, as Chair, wished to control the flow of information to Board members. [ 34 ] Unbeknownst to Mr.

Karmel, an “in camera” meeting of the Board had been scheduled for October 11, 2011, to deal with the report of the Principal Evaluation Committee (PEC). This meeting also appointed an ad hoc committee of the Board to take over the monitoring of the Principal Improvement Plan (PIP). Mr. Karmel became aware of the “in camera” meeting and was alarmed. These meetings are closed or private sessions with no recorded minutes. It was Mr. Karmel’s experience that boards almost never called an “in camera” meeting unless it concerned contract negotiations.

In his experience, boards were always quick to reassure him when they did have private meetings that there were of no concern to him or his role as Principal. Mr. Karmel was understandably worried that members of the Board would be taking decisions on the PEC and PIP without receiving all of the facts and arguments.

[ 35 ] As a result, Mr. Karmel sent each member of the Board a memo (Tab 71), a response to Mr. Kettner’s October 6 email. While the memo is lengthy, Mr. Karmel expressed his concerns about the lack of transparent governance and the control by the Chair of the information flow to the Board on issues of school governance. Mr. Karmel felt that he had been set up to fail, and thought it was important for the Board to understand his point of view. He also felt, apparently wrongly, that the Board wished to know his point of view on these matters. [ 36 ] The memo to the Board brought about a swift reaction from Mr.

Kettner, who emailed Mr. Karmel on October 7 and copied the Vice Chairs; see Tab 75. The email included the following paragraph: Again you have gone directly to the Executive with your concerns about them when I’ve specifically asked you at least twice to not do this again. This is not at all appropriate and undermines my authority. I welcome any concerns you have and will bring them to the Executive myself whether they relate to the Board as a whole or to me individually.

I ask that you immediately cease any sort of direct communication with the Executive that relates to how the Executive should operate and how the President should do his job. [ 37 ] Under previous Chairs, Mr. Karmel testified that he would be consulted on all matters related to the Board’s agendas, and he had never before been told that he was unable to communicate directly with Board members. [ 38 ] Mr. Karmel and Mr. Kettner were off on a bad footing, and Mr. Kettner had consulted legal counsel. While that consultation is privileged, Mr. Kettner would no doubt have been told that Mr.

Karmel had a five-year contract that could only be terminated with just cause. [ 39 ] Attached to Exhibit 9 is a bill rendered by a law firm to the CJA. A consultation occurred on “strategy and options” on August 17, 2011. The bill also references “process” and “drafting resolution regarding mandate”. I have no doubt this refers to the mandate received by the PEC at the “in camera” meeting on October 11, 2011. Further, following consultation with counsel, communication between Mr. Kettner and Mr.

Karmel was mostly in writing. [ 40 ] I note that there are no minutes of the above mentioned “in camera” meeting of October 11, but we have Mr. Kettner’s speaking notes at Tabs 79 and 283. The views expressed at Tab 283 are candid and represent Mr. Kettner’s real opinion. I have little doubt that he shared his opinion with the Board. I find that these speaking notes account for much of what Mr. Kettner communicated to the Board at the meeting. He delivered the remarks under a warning of confidentiality, and they contained insidious criticism of Mr. Karmel. Mr.

Kettner’s comments overall were unmeasured and unbalanced. The process as a whole was extremely unfair. [ 41 ] As a result of the “in camera” meeting, the Board reconstituted the PEC. Mr. Kettner was named as Chair, and the committee included Adam Brener and Stan Eisenberg. Clearly, the message to the Board was that the PEC was necessary to rein in Mr. Karmel, who was going in the wrong direction and refused to be managed by CJA’s Board. Thus, Mr. Kettner was actively pitting the Board against the Principal and utilizing an “in camera” confidential meeting to recruit the Board to his point of view.

In my view, he was not acting in good faith. Further, on October 11, the same day as the “in camera” meeting, Ms. Horwitz, Vice President, sent a letter to Mr. Karmel on behalf of the Board. The letter directed that all future communication be sent exclusively to the Board’s President, Mr. Kettner. The letter made clear that the Board was unanimously behind Mr. Kettner. From that point forward, it was clear that there was to be no partnership in education; a chasm existed between Mr. Karmel and the Board. [ 42 ] The agreed exhibits include numerous notes made by Mr.

Kettner, as well as memos to members of the Board. These are uncomplimentary to Mr. Karmel and further demonstrate Mr. Kettner’s contempt of him. Tab138 is a March 28, 2012 email, one of many to colleagues on the PEC containing derogatory comments about Mr. Karmel. This particular email references “24 hours with Biff”. Biff is a character from the play “Death of a Salesman” by Arthur Miller, and it was not meant as a complimentary label. Moreover, the fact that Mr.

Kettner felt free to refer to the Principal as “Biff” when corresponding with professional colleagues speaks volumes. [ 43 ] Tab 124 is another example of an email in which Mr. Kettner rants about Mr. Karmel; this time to Tracey Forman, a Board member and former Chair. He complains about Mr. Karmel’s incompetence, and compares his ability to be Principal at CJA to Mr. Kettner’s own ability to coach the Calgary Flames. [ 44 ] It is Ms. Forman’s earlier email to Mr. Kettner, also at Tab 124, which is ultimately more revealing.

Her email is dated March 1, 2012, and it includes the following: ...I find it interesting that executive has felt compelled to “micro-manage” administration over the last few years more than ever. In those years we have also seen marked exodus from the school.

Yet... we never really did stop and ask ourselves if maybe the additional involvement and demands the executive placed on Ben/Administration could be the reason for the exodus- maybe our non- professional opinions on what needed to happen, have steered us wrong.- or at the very least, taken Ben’s focus away from what he ( as a professional educator) thinks he should be doing. It’s kind of a devil’s advocate question... but hearing Rory Paul’s rant made me think... if nothing else, we have been guilty of NOT trusting the “professional educators” of our school. Us doubting Ben is really NOT good for anyone.

I believe it has frustrated Ben and it has demoralized the executive. I personally cannot take another “negative Ben bashing” meeting. Eric... you & I alone, are likely the only ones who see how hard, and how long Ben works for our school. It’s not that he doesn’t have some serious flaws (who of us doesn’t), and that he hasn’t made some mistakes (again who of us hasn’t), but he is still at our school, and still WANTS to be at our school in spite of all the s#^! He has to deal with from some very overbearing (not always reasonable) parents. Plus an executive that doesn’t believe in him. I couldn’t take it.

Ben has welcomed CAIS, he welcomed the CTBS and HE was the one who stated that as a community school we needed to be able to educate the gifted and the special needs too. That was NEVER Claude’s philosophy- that was all Ben. I know I am the only cheerleader for Ben. It’s my greatest flaw (or perhaps strength) to see the good in people, to see their potential. The

group that hired Ben, the group that voted to renew his contract saw these things too. I believe that we are headed in the right direction by looking at the things he is not good at, and getting them off his plate. I also believe that a knowledgeable communications person would be worth every penny. [ 45 ] This memo is consistent with the evidence before me that the Board, through Mr. Kettner, was micro managing Mr. Karmel. As Ms. Forman underscored, no one on the Board had qualifications to rival Mr. Karmel’s as an educator.

The email also confirms that many meetings of the executive ended up as a negative “Ben bashing” meetings. At this point, and for little or no reason, the Chair, the PEC and likely much of the Board, had no confidence in Mr. Karmel. This view of the Principal was the result of a process that was unfair and unbalanced. Furthermore, it was all done under the cloak of confidentiality. The only knowledge Mr. Karmel had of any of this was based upon rumour or suspicion. Unhappily, Ms. Forman’s email was but one voice in what should have been a chorus. However, most Board members did not have Ms.

Forman’s experience and they had been influenced and unfairly prejudiced against the Principal by Mr. Kettner. [ 46 ] A meeting between the PEC and Mr. Karmel was held on March 28, 2012. At Tab 141 are Mr. Kettner’s talking points, which convey the message communicated to Mr. Karmel at this meeting. [ 47 ] Following the meeting, Mr. Karmel responded to Mr. Kettner (Tab 142). It is interesting to contrast tabs 141 and 142. Mr. Kettner clearly viewed the PEC and the PIP differently from Mr. Karmel. The PEC viewed its role as establishing criteria against which the Principal was to be measured. Mr.

Karmel, in contrast, continued to believe that the PIP was a collaborative process. It was meant to be implemented in good faith, with positive benefits to both the school and the Principal. I find that a process of good faith and collaboration was the proper and original intention of the PIP. The process adopted, however was, not in line with this approach. Rather it proceeded to document the PEC’s dissatisfaction with Mr. Karmel. ii. 2012-2013 School Year [ 48 ] The 2012-2013 school year began with the Board Orientation meeting. This was an annual event, particularly aimed at new members.

In 2012 there were another five new members on the Board. In previous years, the Orientation meeting invariably included the Principal. In September 2012, however, the Board held the meeting without Mr. Karmel, despite him usually being a key figure. Understandably, Mr. Karmel was confused and hurt. We have the benefit of Mr. Kettner’s speaking notes at Tab 182. He informed the meeting’s participants that enrollment had declined since Mr. Karmel’s contract was renewed. He also told them that there had been a loss of confidence in Mr. Karmel’s leadership. While that represented Mr.

Kettner’s own view, it was most unfair of him to share with the others this negative perception, particularly at the first meeting of the school year. [ 49 ] Mr. Kettner further advised the Board at this meeting that the CJA had sought legal advice, and that Mr. Karmel had a “no cut” contract. The CJA would have to pay him the balance in order to terminate him. Mr. Kettner informed the Board that this was not financially viable. [ 50 ] At Tab 189 there is an email dated September 20, 2012, from Mr. Kettner to Mr. Brener, Mr. Eisenberg and Mr. Benjamin on the subject of “I like sharing my joy”.

It was another “Ben bashing” memo which concluded as follows: I am still not sure on how to respond. Stan’s earlier suggestion to me to just tell Ben to take care of this mess appropriately makes the most sense, but I wonder, too, if there’s a way to use it against him. I’m looking for some more suggestions. [ 51 ] This email is evidence that the PEC was not working to improve the situation. Rather Mr. Kettner was looking for a way to sabotage Mr. Karmel, and he was not the least bit shy about sharing that intention with the email recipients.

That he was doing so, and seeking the assistance of others (there is no response in evidence), suggests that the recipients were not offended by the notion of plotting against Mr. Karmel. I find that the PEC was not conducting its mandate in good faith. Mr. Kettner was controlling the flow of information to the other members of the committee, and had succeeded in recruiting them to his point of view. The other volunteer members did not challenge Mr. Kettner or his views. It was clear from their evidence at trial that the PEC members were aligned with Mr.

Kettner’s opinion of the Principal. [ 52 ] To put matters in perspective, the CJA, despite its difficulties, was achieving academically. Some of its accomplishments are included in the “Principal’s Perspective” at Tab 167. The school did well in the Fraser rankings, and was accepted as a candidate by the Canadian Accredited Independent Schools (CAIS); at the time, there were only four private schools in Calgary that were CAIS accredited. [ 53 ] At Tab 198 is a document entitled “Ratification of the mandate of the Special Committee- October 10, 2012”.

Apparently this was a motion that was passed by the Board at its meeting October 10, 2012, although the minutes exhibited at the trial do not contain a record of this motion. It may well be that this was another “in camera” session. According to Mr. Karmel, these sessions were increasingly common at the end of regular Board meetings. In any event, this motion devolved the role of evaluating the Principal on the Board’s behalf to the PEC. It also provided the PEC with the power necessary to carry out this mandate. By this point, if not earlier, I find that Mr. Kettner was determined to terminate Mr.

Karmel. [ 54 ] No one informed Mr. Karmel of this new mandate. He had, however, heard a rumor that the Board was out to get him. A female Board member had apparently shared this with another parent, and it found its way to Mr. Karmel. This was understandably upsetting to Mr. Karmel, and he wrote a long letter to the PEC dated October 28, 2012 (Tab 204). The letter contains a litany of concerns, and was clearly written by someone who felt isolated and under attack. Mr. Karmel referred to the Board as micro managing the School.

He discussed the divisive atmosphere and the hostility between the Board and the administration. He itemized many examples of Board behavior that he believed had contributed to the climate of workplace hostility, and pleaded with the Board to take his concerns seriously. He concluded as follows: Despite the concerns I’ve outlined above, I continue to have faith in all of us. It is time for us to move together within an environment with humility, positive communication and mutual high regard and strategic direction. Anything less is unbecoming for the CJA.

I am continuing with the hard work ahead and will work in good faith with the Board. I expect the same in return.

[ 55 ] If that was his expectation it was ill founded. Mr. Kettner was determined to vacate Mr. Karmel from his position as Principal of the CJA. [ 56 ] A meeting between the PEC and Mr. Karmel took place on October 29, 2012. Mr. Josh Benjamin, who was not a member of the committee, joined the meeting. It was recorded at Mr. Karmel’s request. As had become common with other CJA executive meetings, there was little notice and no agenda. The committee presented Mr. Karmel with a letter on their behalf. The letter, dated October 29, 2012, became the subject matter of subsequent correspondence.

It was also referred to in much of the evidence given at trial. For this reason I set the content of the letter out in its entirety: Mr. Ben Karmel Principal Calgary Jewish Academy October 29, 2012 Dear Ben, Our committee has been working with you, as leader of the CJA, for the past year to help you in your role as Principal. In light of the Board’s fiduciary responsibilities to the CJA and as your employer, it is necessary to bring the following to you out of concern for the CJA and the direction it is headed under your leadership in view of the continuing decline in enrolment and faltering financial position.

We had intended to bring this letter to you in early September, but out of respect to you and in consideration of your personal matters early in that month, we postponed its delivery until now. As you are aware, more than 100 students have left the CJA for other schools over the past three years (33% of the 2008/2009 enrolment-4 times the average attrition rate over the previous twenty years). The school’s financial well-being is in jeopardy as our reserve funds are being depleted as the school faces a budget deficit for the third time in four years.

In reviewing your Personal Improvement Plan and the standards expected of a principal in Alberta as delineated by the Alberta Education in the Principal Quality Practice Guideline (February, 2009), we have identified problems that have hindered both your and the school’s progress towards a successful turnaround. Below, please find the problems that require your immediate attention: 1) Professionalism- As a private school, with significantly tuition fees, parents have an expectation of excellence.

Some recent examples indicating a marked departure from the expected standard of professionalism: • Numerous communications to parents with spelling and grammatical errors. • Administration and staff have been disrespectful in communications with parents and board members at the school, including Mrs. Horwitz, Mrs. Cheuk, and Mrs. Barkai. • Some CJA staff members have been sending emails to parents on Shabbat and Jewish Holidays • Failure by you to reply to email correspondence and meeting requests • The handling of the situation with the foster children that arose prior to the start of the 2012-2013 school year.

Initially you would not enrol the children as you felt it was too difficult to deal with their grandfather. Furthermore, you stated that JFS decided that it would be best for these children to attend Akiva Academy. However, JFS has maintained, throughout, the children’s best interests would be served by attending the CJA. For the CJA to succeed in becoming, once again, a well-respected and financially sustainable school, it is imperative that professionalism be displayed in every aspect of the CJA’s activities, inside and outside the school.

WE require a draft action plan be presented to the PIP Committee (the “Committee”) and implemented by November 12, 2012. The Committee expects a weekly written report detailing any lapses in professionalism. 2) Technology integration- Within the CJA Mission statement, as well as the Principle Quality Practice Guideline, the effective utilization of technology is directed. Over the past two years, the CJA Board has approved funding for Renweb and the digital classroom initiative (teacher laptops were also purchased). The problems brought to you on previous occasions continue, including:

• Under-utilization of classroom monitors. Most teachers use them sparingly, if at all. • The Board is not aware of teachers creating “Khan Academy” like video segments which were highlighted when the proposal was presented. • Reweb was to be fully implemented over 13 months ago. • There are inconsistencies between teachers and grades regarding the use of Renweb for communicating homework and test/assignment mark.

To help ensure the success of these programs, we required detailed reports on both the Renweb and digital classroom initiatives which are to include analysis of: expectation and actual uses of these technologies, video segments produced (including expenditures to date), time and cost savings for teachers and staff re Renweb, the successes and/or failures of both. Please include a strategy, plan, and timeline to guide these initiatives towards full implementation.

We require completion of these reports by November 28, 2012. 3) Personal Improvement Plan- The Personal Improvement Plan (“PIP”) was developed by you and the consultant, Audrey Goldfarb, to assist in improving your leadership skills and introduce various strategies to improve the school and its reputation. This PIP was agreed to, and accepted by, you and the Board. The Committee extended you much latitude for compliance with the target class. As neither the enrolment nor the financial picture of the school has improved, there is no longer room for leeway.

While all the PIP items are important, the Board has prioritized the following outstanding items as the Board feels these are crucial for the CJA at this time: a. Leadership #1- Develop teachers as leaders. Engaged staff in focus areas of inquiry. b. Leadership #4- Develop a plan to increase enrolment. c. Education Excellence #1- Clarify methods of measuring school achievement and success. d. Educational Excellence #2- Enrich Curriculum to meet school values and achievement goals. e. Wider Community Perception- Principal and Admissions Director will develop an annual

schedule to increase opportunities to speak and feature school in the wider community. Several of these are long past due; others (items “a” and “d”) are ongoing responsibilities. We require reports on the progress of these items on a weekly basis. The deadline for completions of items “b”, “c”, and “e” is December 28 th , 2012. Ben, we have identified and brought these problems to you for your own benefit. Ultimately, our goals in this are for you to succeed as principal of the CJA and for the school to be set on a course toward another 100 years of success.

Please come to us if you require any additional support or resources to accomplish these goals so we can do our best to meet your needs to enable you to succeed. [ 57 ] I am sure that Mr. Kettner wrote the final passage, and I am equally sure that he did not wish for Mr. Karmel’s success. The letter is yet another example of bad faith dealings on the part of the PEC and Mr. Kettner. [ 58 ] Prior to this October 29, 2012 meeting, the PEC had not met with Mr. Karmel since April of that year. At that time there had been general discussion of the successes and failures of the Principal as perceived by the committee.

Mr. Karmel had made extensive responses to those issues; see Tabs 142, 143, 144 and 146. Yet Mr. Karmel did not receive a reply to these efforts from the PEC. Mr. Karmel had also invited collaborative discussion between the committee and himself, but none occurred. Instead, the next thing Mr. Karmel received was the letter set out in above. [ 59 ] Given the way things were left between the PEC and Mr. Karmel in April 2012, the letter of October 29 could not have come as anything but a surprise to Mr. Karmel. The PEC was not engaged in any collaborative effort; rather it was seeking Mr.

Karmel’s termination. [ 60 ] As indicated at the outset of this judgment, the reasons given for Mr. Karmel’s dismissal were wide ranging. They encompassed areas that Mr. Karmel was responsible for as school Principal. He reported to the Board by way of numerous reports. He was part of numerous committees in the school that dealt with of his areas of responsibility. With these responsibilities in mind, particularly as they relate to the reasons given for Mr. Karmel’s termination, I turn to the details of the October 29 letter. iii.

The October 29 letter and follow-up correspondence [ 61 ] The letter begins with setting out the enrollment problem faced by the CJA, which was a significant concern to those responsible for school governance. Yet the problem was complex, and in order to deal with it effectively a collaborative approach was required. Mr. Karmel testified that the enrollment issue was always on his mind and that all of his decisions reflected his concern about CJA’s enrollment. Indeed, the most thoughtful views on enrollment in evidence before me were those of Mr. Karmel.

As he said, the issue was entwined with the CJA’s self-perception, and indicated the need for a strategic plan going forward. Enrollment was also was tied up with the school’s morale, which was dependent upon good faith collaboration between the administration and the Board. [ 62 ] One specific example of these issues, as set out in the evidence of Mr. Karmel and others, was that the CJA had not resolved

the tension between its values of inclusion and the promotion of special programming for gifted children. Parents of gifted children were constantly looking for programming that offered their children the best chance to excel academically. The evidence before me indicates that Mr. Karmel was the only person who attempted to address this tension, and the only one who had a considered view on the matter. [ 63 ] Moreover, I have no hesitation in accepting Mr. Karmel’s evidence that he constantly worked at his PIP with little or no feedback from the PEC. Yet the PEC’s October 29 letter went on to reference Mr.

Karmel’s PIP and a number of specific problems. The first problem cited was “professionalism.” Under this heading, the letter referred to communication with parents that included spelling and grammatical errors. The letter did not offer supporting examples, and the evidence does not support that this was a serious concern. I believe that the criticism emanated from an email at Tab 193, to Mr. Kettner from Ms. Horwitz. She had just heard from another parent who received communication with spelling errors and typos.

The October 29 letter further specified that administration or staff had been disrespectful to parents. While the record discloses that there were occasional heated exchanges over some issues, this is, in my view, typical of any school. It was not something that warranted undue attention on anyone’s part. [ 64 ] The letter also complained that staff members had been sending emails on Jewish holidays. Mr. Karmel acknowledged that the policy was to prevent this from happening, and I accept his evidence. The alleged failure by Mr. Karmel to reply to email correspondence and meeting requests no doubt refers to Mr.

Kettner’s memo to his fellow committee members at Tab 194 that Mr. Karmel had not responded to his requests. I do not find this to be a valid ground for termination, as a simple phone call from Mr. Kettner would have remedied the issue. The final specific example relates to an isolated incident involving foster children, and the allegation was not borne out in the evidence before me. I was completely satisfied as to Mr. Karmel’s explanation on this matter. [ 65 ] In my view, the PEC’s request for a draft action plan on professionalism was unnecessary because it was not based on meritorious concerns.

Furthermore, the requests for a written weekly report detailing any lapse in professionalism was an ill-advised request for the reasons set out by Mr. Karmel in his subsequent communications. As I have already determined, the PEC was not acting in good faith and was actively seeking Mr. Karmel’s termination. [ 66 ] The complaint related to technology integration is, in my view, equally lacking in substance. The CJA, like many organizations in 2012, was attempting to embrace technology and to use it both in the classroom and for communication with parents.

As is often the case with technology, implementation was a challenge because parents, students and teachers have different levels of computer skills. Utilization was neither uniform nor predictable. Furthermore, Mr. Karmel was not an expert in this field. The person responsible for technology integration, Mr. Suissa, was involved in presentations to the Board on the subject. Mr. Suissa also sat on the technology committee, which had regular meetings. In fact, Mr. Kettner was also a member of that committee. Reports related to technology were often the subject of Mr.

Karmel’s administrative submissions that were given at Board meetings. [ 67 ] On my review of the evidence, I am satisfied that the CJA’s technology policy was both sound and necessary. Though it encountered varied reception, this was dependent upon the computer sophistication of parents and teachers. I can find no fault with the administration and its approach to technology integration. Moreover, I believe that Mr. Karmel and others who were involved in technology integration cooperated fully in delivering the information that the Board or PEC requested.

This was accomplished through routine reports and specific responses made to the Board and PEC by Mr. Karmel and Mr. Suissa. I find that Mr. Karmel is not at fault on this issue, and certainly not to an extent that would warrant cause for termination. [ 68 ] The final allegations in the October 29 letter are specific to the PIP. As I have stated, Mr. Karmel’s evidence was that he was following up with respect to each aspect of the plan. I accept that evidence. Moreover, Tab 144 provides Mr. Karmel’s notes relating to a meeting held April 5, 2012, with Mr. Kettner.

These notes detail the ways in which each and every item in the PIP was reviewed. [ 69 ] As mentioned above, Mr. Karmel did not receive any meaningful feedback to the responses given to previous meetings until he received the October 29 letter. There had been little discussion between the PEC and Mr. Karmel, despite his attempts to provide meaningful answers the PEC’s earlier concerns. Furthermore, it is my view that the PEC’s complaints had little impact, if any, upon the enrollment or the financial dilemmas facing the CJA.

Ironically, the greatest problem facing the CJA during the fall of 2012 was its governance. It had become dysfunctional. The situation, as described by Ms. Forman at in her March 2012 email at Tab 124, had worsened. [ 70 ] By early November, Mr. Karmel was near his breaking point. He had been taking medication for sleep and for depression. Nevertheless, he authored a comprehensive response to the October 29 letter, dated November 2, which he sent to the PEC. Mr. Karmel acknowledged and replied to the issues enumerated in the October 29 letter; see Tab 206.

He also indicated that he expected a reply to his correspondence. Furthermore, he said it was his expectation that the Board Chair would distribute his correspondence to all Board members. He went on to request that he be advised if that was not the case. There is no evidence before me, or in Mr. Kettner’s reply, to determine whether Mr. Kettner’s correspondence was distributed to the Board. [ 71 ] Mr. Karmel’s letter went on to respond to the issues raised in the October 29 letter. Mr.

Karmel made the point that, in addition to his onerous responsibilities as Principal, the letter demanded that he write additional reports. His response was that he would update the Board and the PEC as to operational matters of the school. He pointed out that he had already addressed all the concerns raised by the PEC in previous correspondence. He stated that if there were any questions he would be pleased to set aside time to meet and discuss them.

He reiterated his belief that “the way forward is true dialogue and mutual good faith.” In the next paragraph he stated that “given the above and this turn of events, let’s meet and discuss in good faith and I am sure we can continue to find far more common ground than a culture of differences.” [ 72 ] I have found myself asking numerous times why the PEC did not meet with Mr. Karmel for a candid exchange of views. The answer can only be that Mr. Kettner consciously decided against it. I find this to be astonishing, yet I received no credible explanation as to why none of Mr.

Karmel’s invitations to meet were accepted. [ 73 ] I can only conclude that the paint incident of August 16, 2011, soured Mr. Kettner on Mr. Karmel as Principal. Following the meeting with Mr. Karmel and Ms. Horwitz on August 17, 2011, Mr. Kettner felt that Mr. Karmel was going to make things difficult for him. He felt Mr. Karmel was going to be “resistant”. The speaking notes at Tab 283 for the October 2011 “in camera” meeting confirm

this finding: Ben doesn’t think we’re entitled to manage him--- I with the consent of the special committee need to be able to manage him if he needs managing. Right now--- he needs managing. He doesn’t respect any sort of authority from me at this moment.--- If we continue to allow him free rein it will be seen in the eyes of the law as consent to his behavior we’ll have very little power to control him in the future. [ 74 ] Mr. Kettner saw Mr. Karmel as a threat to his authority, and he was determined to either bring Mr. Karmel around to his own way of thinking, or get rid of him.

It was early in the 2011-2012 school year that Mr. Kettner sought legal counsel. [ 75 ] Mr. Kettner did not take criticism lightly. When Mr. Karmel challenged some of Mr. Kettner’s governance methods and his lack of transparency, he got angry. Mr. Kettner did not like the Ambassador Program because he was concerned it would turn into a “parking lot mafia”. Disgruntled parents could make trouble for the executive, and he absolutely did not agree with Mr. Karmel that the school should facilitate constructive criticism. Any criticism received by Mr.

Kettner from parents, particularly Board parents, he saw as a criticism of Mr. Karmel. But Mr. Karmel was not a “yes” man, and his standing up to parents was seen by Mr. Kettner as insensitive and arrogant. [ 76 ] Mr. Kettner, in his emails and during his evidence, said he was doing everything to help Mr. Karmel succeed. For example, in Tab 124, his March 1, 2012 email to Ms. Forman stated, “there is nothing more than I want to see Ben triumph.” That statement is not credible. Seen in the context of all of the other emails, it is clear that Mr. Kettner had formed the opinion that Mr.

Karmel was not the Principal that he wanted for the CJA. Mr. Kettner wanted things done his way. The rest of the email to Ms. Forman is a rant, or, as Ms. Forman referred to it, “Ben bashing”. I believe that Mr. Kettner took every opportunity to persuade his colleagues on the Board that Mr. Karmel was a hopeless Principal. [ 77 ] His memos, speaking notes, and the other evidence make it clear that Mr. Kettner was not working to help Mr. Karmel succeed. Rather he took every opportunity to sabotage Mr. Karmel in the minds of his colleagues on the PEC and on the Board. He excluded Mr.

Karmel from the Board orientation meeting in the fall of 2012, and from an initial meeting to discuss the CJA’s strategic plan in December 2012. Mr. Karmel was not informed about the meetings, nor did he receive a copy of the minutes or the documents related to it. While unfair and regrettable, this is not surprising considering Mr. Kettner’s intention to oust Mr. Karmel as Principal. [ 78 ] The PEC members maintained the position that Mr. Karmel’s November 2 letter was “non-responsive,” and did not constitute the reports requested in their October 29 letter. I disagree.

However, anyone reading the correspondence between Mr. Karmel and the PEC can plainly see that they were communicating at cross-purposes. They did not see eye to eye on important governance issues, and they had very different views on what constituted collaboration between a Principal and a school board. The situation cried out for a meeting, yet what ensued was another demand letter from the PEC dated November 11, 2012, at Tab 209. Rather than accepting Mr.

Karmel’s invitation to meet, the letter reiterated that the Board’s responsibility for overseeing the operation of the school, and as part of that “we oversee and manage you as the school Principal. You report and answer to the Board.” [ 79 ] The November 11 letter was a continuation of the determined effort by Mr. Kettner to get rid of Mr. Karmel. He defends the areas identified in the October 29 letter as priorities necessary to address the CJA’s falling enrollment and financial troubles. In my view, blaming the CJA’s struggles on the issue listed in the October 29 letter was an unreasonable assessment. Mr.

Kettner went on to say in the November 11 letter that the items and deadlines were made with the careful consideration as to what is important and for the success of the school in providing the best possible outcomes for the students while at the same time taking into account your busy schedule. Again, it is my view that this conclusion was not one that would have been reached by a reasonable, fully informed Board member. [ 80 ] At least by this point in the narrative the die is cast. Subsequent correspondence contained repeated and additional demands by Mr. Kettner.

These are met by increasingly frustrated responses by Mr. Karmel. For example, Mr. Kettner complains at Tab 13 about Mr. Karmel leaving a meeting at 9:20 pm and takes great exception to that. Mr. Karmel in subsequent correspondence and in his evidence responds to this and I am satisfied with his response. Nevertheless, it does not really matter. The parties were not effectively communicating if they ever did. The story only has one ending; that is Mr. Karmel’s termination. [ 81 ] Parents of students including board parents were complaining about the grade four class. In December, Mr.

Kettner demanded an immediate report from Mr. Karmel by December 14. Mr. Karmel was frustrated because he did not think that the evidence supported the parents’ complaints. Notwithstanding his frustration, he did respond on December 10 (Tab 223) and the substance of the response is on pages 4 and 5. However, by this time the relationship is dysfunctional. There is little mutual respect and Mr. Kettner is determined to terminate Mr. Karmel. iv. Conclusion on the evidence [ 82 ] There is little point in setting out the rest of the correspondence. By the end of 2012, as I have emphasized, the die was cast.

By the time the special meeting of the Board was called in February 2013, it was obvious that the PEC would recommend Mr. Karmel’s removal. Since Mr. Kettner was in control of the flow of information, no one on the Board could meaningfully question the recommendation. It was clear to all Board members that the relationship between Mr. Karmel and Mr. Kettner had become intolerable and was not sustainable. The Board had long since determined that it would stand behind Mr. Kettner. [ 83 ] Once the PEC delivered the October 29 letter, it ignored Mr.

Karmel’s responses or deemed them “non-responsive.” Either the members of the PEC did not read the materials available to them, or they were deaf to Mr. Karmel’s point of view. They made little or no effort to learn Mr. Karmel’s opinion on any of the issues. Remarkably, in my view, both Mr. Brener and Ms. Eisenberg found a number of Mr. Karmel’s emails bordering on insubordination or condescension. In one case, Mr. Brener found Mr. Karmel’s email at Tab 71, and in particular, the third paragraph on page 6 to be “a pre-emptive strike at an allegation of constructive dismissal.” That suggestion is not credible. Mr.

Karmel’s dedication to the CJA was common knowledge, and the success of the school was of the upmost importance to him. In my view, outside of his family and his faith, the CJA was the most important thing in Mr. Karmel’s life.

[84] Further, the tight-knit nature of the Calgary Jewish community meant that the issues faced by Mr. Karmel in his role asPrincipal of the CJA were especially significant. While some professionals distinguish between their work and personal lives, Mr.Karmel’s were one in the same. His future at the CJA was therefore bound up with his role and reputation in his community. [85] The members of the Board who testified on behalf of the CJA stressed that they considered one of Mr. Karmel’s biggestfailings to be budgetary choice he made with regard to the Gain Program.

This program was aimed at gifted children and children withidentified needs. The CJA hired Ms. Kristen Walker as the Gain Program Coordinator but she was only able to work part-time. Becauseshe was the only person qualified to do the job (and Mr. Karmel said she was very qualified), the CJA left several thousands of dollarsearmarked for the Gain Program unspent. I am completely satisfied with Mr. Karmel’s explanation on this subject. It was impossible toget a qualified person full-time, and the CJA paid Ms. Walker a part-time salary.

It would have made no sense to spend the moneysimply because it had been earmarked in the budget. I therefore do not accept the evidence regarding the Gain Program as a validcriticism of Mr. Karmel. [86] As I have previously stated, Mr. Kettner clearly recruited members of the PEC to take a certain view of Mr. Karmel. The restof the Board was faced with the unanimous recommendation of the PEC, which the Board itself had mandated to monitor and manageMr. Karmel. I find that the PEC made no effort to conduct a fair investigation of the issues. At no time was Mr.

Karmel’s positionadequately put forward to the Board. [87] Mr. Karmel was terminated by the Board on February 25, 2013. The reasons for termination have, on the evidence before me,no merit. I have carefully reviewed all the evidence and in my view, no person fully informed, could come to the conclusion that the CJAhad just cause to dismiss Mr. Karmel. Far from being wilfully disobedient, Mr. Karmel made numerous good faith attempts to resolvethe issues that plagued the CJA’s governance.

Unfortunately, and through no fault of his own, individuals who sought his terminationrejected his efforts. [88] I have re-listened to much of the testimony and have reviewed my notes, all the memoranda, correspondence and emailsentered as exhibits. I accept Mr. Karmel’s explanation with the respect to each of the reasons for termination set out in the terminationletter. I find that Mr. Karmel was not guilty of wilfully disregarding reasonable demands by the Board or the PEC. Mr. Kettner waspursuing a strategy of papering a path to Mr.

Karmel’s termination in such a way as to spare the CJA from paying the balance of Mr.Karmel’s salary under the remaining term of his contact. This was a wrongful dismissal carried out in bad faith. Mr. Karmel is thereforeentitled to damages. Damages [89] Mr. Karmel is entitled to damages for the salary owed to him under the employment contract, as well as aggravated damagesin compensation for the bad faith conduct of Mr. Kettner and the PEC acting in their official capacities on behalf of the CJA.

I turn firstto the employment contract. [90] The parties agreed that the outstanding balance owed under the contract is as follows: $606,027.97 for base salary;$39,391.85 for the lost benefit of RRSP matching contributions; and $24,568.24 for loss of the group benefit plan. Damages under theemployment contract therefore total $669,988.06. [91] Mr. Karmel is also entitled to aggravated damages. It has long been established that employers owe a duty of good faith andfair dealing when terminating an employee.

The breach of this duty is compensable with aggravated “bad faith”, “Wallace” or “Honda”damages, in addition to damages for wrongful dismissal: see Wallace v United Grain Growers, (SCC), [1997] 3 SCR701, SCJ No 94, Keays v Honda Canada Inc, 2008 SCC 39, [2008] 2 SCR 362. [92] The law requires employers to be “candid, reasonable, honest and forthright with their employees.” Employers cannotlawfully engage “in conduct that is unfair or is in bad faith by being, for example, untruthful, misleading or unduly insensitive” seeWallace at para 98. [93] My reasons articulated in this judgment make clear that Mr.

Kettner, acting in his official capacity on behalf of the CJA, wasin violation of the duties enumerated in Wallace. The other members of the PEC acquiesced. Not only was the PEC unreasonable inrecommending the termination of Mr. Karmel’s contract, it also acted in bad faith for much of the time leading up to the termination. [94] Two recent cases of the Supreme Court of Canada are directly relevant here. First, in Bhasin v Hrynew, 2014 SCC 71, theCourt was unanimous in recognizing that “good faith contractual performance is a general organizing principle of the common law,” seepara 33.

As a result of the decision in Bhasin, parties to a contract have a duty to act honestly in the performance of their contractualobligations. [95] While Bhasin was not specific to the employment context, the Supreme Court’s decision in Potter v New Brunswick LegalAid Services Commission, 2015 SCC 10, referenced the good faith requirements in Bhasin in the context of wrongful dismissal. TheCourt defined the employer’s duty of good faith as one which extends throughout the duration of employment, and not just at the time orevent of termination.

Employers must therefore demonstrate good faith for the entirety of the employment contract. [96] In the matter before me, it is clear that the CJA failed in its duty to act in good faith for a period of about 18 months. [97] An award of $200,000 for aggravated damages was recently upheld by the Ontario Court of Appeal in the wrongful dismissalcontext in Boucher v Wal-Mart Canada Corp, 2014 ONCA 419, [2014] OJ No 2452. In affirming the quantum of the award, JusticeLaskin stated at para 66 that [a]ggravated damages are compensatory damages. They are part of breach of contract damages.

They compensate a plaintiff for theadditional harm suffered because of the way the contract was breached. In a wrongful dismissal claim, aggravated damages may beawarded against the employer where "the employer engages in conduct during the course of dismissal that is 'unfair or is in bad faith'...However, ‘the normal distress and hurt feelings resulting from dismissal are not compensable.’

[ 98 ] The evidence of Ms. Karmel was that Mr. Karmel suffered considerably before, during and after his sudden termination mid- year. Rumors were rampant surrounding his firing. He felt isolated. He and his family felt socially uncomfortable in their otherwise tight knit community. Although Mr. Karmel diligently sought similar employment, he met with no success. Eventually he retrained and became a licensed private investigator. [ 99 ] I am satisfied that Mr.

Karmel has proven intentional and calculated actions by those acting on behalf of the CJA, which resulted in his mental distress and isolation in his community. Not only were these actions carried out in the course of Mr. Karmel’s termination, they also persisted for months prior. [ 100 ] The case before me was not one of “normal distress and hurt feelings.” Rather the CJA’s conduct was consistent with the sort of bad faith dealings that aggravated damages are intended to remedy. Indeed, the facts of the case are particularly insidious. I therefore award Mr.

Karmel $200,000.00 in aggravated damages for the harm he suffered because of the CJA’s conduct. While this amount is at the high end of the spectrum for bad faith damages, the harm to Mr. Karmel’s reputation and mental health warrants a significant compensatory award. [ 101 ] I have not examined the issue of whether defamation has been established in this case. I do not find defamation to be necessary. Nor does it fit comfortably with an analysis of wrongful termination. As my reasons make clear, aggravated damages provide sufficient compensation for the harm suffered by Mr.

Karmel. [ 102 ] I note that while the conduct may well have been sufficiently egregious as to warrant punitive damages, I have awarded an amount to compensate Mr. Karmel. I do not believe that he would wish to punish the CJA with further punitive damages. [ 103 ] The Plaintiff shall have interest in accordance with the Judgment Interest Act. The parties may speak to costs if they cannot agree. Heard on the 24 th to the 28 th day of November, 2014; and on the 1 st and 3 rd to the 5 th day of December, 2014; and on the 18 th and 19 th day of December, 2014.

Dated at the City of Calgary, Alberta this 20 th day of November, 2015. A.D. Macleod J.C.Q.B.A. Appearances: Mr. Thomas S. Kent- Ridout Barron for the Plaintiff Mr. Michael D.A. Ford, Q.C. Ms. L. Easton- DLA Piper (Canada) LLP for the Defendant