Cumbria Engineering Ltd v Capital Power Corporation, 2016 ABQB 57

Court of Queen ’ s Bench of Alberta Citation: Cumbria Engineering Ltd v Capital Power Corporation, 2016 ABQB 57 Date: 20160127 Docket: 0803 15898 Registry: Edmonton Between: Cumbria Engineering Ltd. Plaintiff - and - Capital Power Corporation, Scott Pocaluyko and Kevin Halldorson Defendants _______________________________________________________ Oral Reasons for Judgment of the Honourable Mr Justice W.N. Renke _______________________________________________________ This oral trial judgment has been edited for publication.

Note: The actions against Scott Pocaluyko and Kevin Halldorson were discontinued prior to trial. Introduction [ 1 ] The Mechanical Engineering group at EPCOR Utilities (the predecessor to Capital Power Corporation) did not have capacity to complete all projects that needed to be done. To get work done, EPCOR retained third party engineers. [ 2 ] On March 1 2007, EPCOR and Cumbria Engineering entered into an agreement whereby Cumbria Engineering seconded some of its employees to EPCOR to work on projects. Two of these seconded Cumbria employees were Scott Pocaluyko and Kevin Halldorson.

The agreement between EPCOR and Cumbria contained a non-solicitation clause. During the period in which the non- solicitation clause was operational, Mr Pocaluyko and Mr Halldorson resigned from Cumbria and were hired by EPCOR. The overarching question is whether EPCOR violated the non-solicitation clause through hiring Mr Pocaluyko and Mr Halldorson.

Issues [3] There are four main sets of issues: A. What does clause 10, the non-solicitation clause, mean? B. Did EPCOR violate clause 10 through hiring Mr Pocaluyko? C. Did EPCOR violate clause 10 through hiring Mr Halldorson? D.

If EPCOR violated clause 10 through hiring Mr Pocaluyko or Mr Halldorson or both, does its conduct attract an award of punitivedamages? [4] The parties agreed that if EPCOR violated clause 10 through hiring Mr Pocaluyko and Mr Halldorson, the amount ofcompensatory damages payable to Cumbria pursuant to clause 10 would be $360,880.80. [5] I’ll begin by briefly describing the background to the issues. Background [6] The Defendant is Capital Power Corporation. Its predecessor was EPCOR Utilities Inc. EPCOR entered into the contractwith Cumbria that’s the subject of this litigation.

I’ll refer to the Defendant as EPCOR throughout and to the Plaintiff (that has also gonethrough a name change) as Cumbria. [7] EPCOR employed its own team of engineers. EPCOR engaged the services of third party engineers to assist with projectswhen its engineering team was at capacity. In 2007, EPCOR had a large number of projects, more than could be handled by itsengineering staff. Third party engineers were required to work on projects. [8] Independent engineering firms such as Cumbria provide engineering services to EPCOR through seconding their employeesto EPCOR.

Seconded employees remain employed by their independent engineering firms but work at EPCOR facilities and takedirection from EPCOR respecting assigned projects. [9] Cumbria provided engineering services to EPCOR through three agreements between 2005 and 2007. On March 1, 2007 theagreement that’s the subject of these proceedings was signed. It is labelled “EPCOR Contractor’s Agreement (Alberta).” Its term isMarch 1, 2007 to December 31, 2009 (the Agreement). Pursuant to the Agreement, Cumbria seconded certain of its employees toEPCOR, including Scott Pocaluyko and Kevin Halldorson.

The Services to be provided by Cumbria to EPCOR were set out in ScheduleA to the Agreement.

Schedule B set out terms and conditions of the Agreement. [10] These terms and conditions in

Schedule B included the contractual provision at issue in this litigation, clause 10, the non-solicitation clause. This clause had appeared in the two previous agreements between Cumbria and EPCOR. [11] The Agreement was prepared by EPCOR. The

Schedule B terms and conditions were not negotiated but were set by EPCOR. A.

Interpretation of Clause 10 1. Principles of Contractual

Interpretation [12] We sometimes describe contractual

interpretation as the work of discerning the parties’ intentions. There’s no harm in thatformulation, since ordinarily we say what we mean and mean what we say – communication depends on this. Yet the focus ofcontractual

interpretation, at least in the absence of ambiguity, is on what the contract says; on what it means, not what they meant.Absent ambiguity, the contract spares us from the need to consult histories and private intentions. Contractual language and the meaningof contracts, then, enjoy a certain independence from the subjectivity of parties. It follows that the proper approach to

interpretation is“objective” in the sense that the goal is to understand the text itself – or what it would mean (objectively) to a “reasonable” reader, asunderstood by the judiciary: Omers Energy Inc v Alberta (Energy Resources Conservation Board), 2011 ABCA 251, Conrad JA atparas 34 and 35. [13] The starting point for

interpretation, then, should be with what the text objectively says – i.e., with its plain or ordinarymeaning. Put another way, as stated by Justice Sullivan in ATB v Macleod Dixon, 2001 ABQB 73 at para 32, In interpreting an agreement, the objective of this Court is to discover the intention of the parties as determined in accordance with theplain or ordinary and popular meaning of the words used by them. In the absence of ambiguity, the natural or literal meaning of thewords set out in the contract should be adopted.

Similarly, Justice Egbert wrote in Merrill Petroleums v Seaboard Oil Co (1957), (AB KB), 22 WWR 529 (Alta SC),affd 25 WWR 236 (Alta SC App Div) at 550 (SC), …The cardinal principle of the construction of contracts is that each word must have assigned to it its plain, ordinary meaning …Therefore, when parties choose certain words to express their meaning and to define their relationships, there is no excuse for distortingthose words out of their ordinary plain meaning.

See Ziegler v Green Acres (Pine Lake) Ltd, 2013 ABQB 349, Yamauchi J at para 12. [14] None of this is to say that unambiguous texts support only one more-or-less obscured meaning. Readings of a text may becontestable, and so the subject of litigation. Contestability does not entail that there cannot be “better” and “worse” readings. A job of thejudiciary is to settle contested readings authoritatively. [15] Even if meaning escapes parties’ subjectivities, it is still conditioned by internal and external factors. Externally, a text will bedeployed in a context.

Within a context, a text will serve a purpose or set of purposes. Context can be both general (e.g. relating to anindustry) and specific (e.g. the factual background to a particular transaction): Nexxtep Resources Ltd v Talisman Energy Inc, 2013ABCA 40 at para 21.

Sattva cautions that while surrounding circumstances should be considered in interpreting contractual terms (theevidence is an “interpretive aid” for determining meaning), surrounding circumstances “must never be allowed to overwhelm the wordsof [an] agreement:” Sattva Capital Corp v Creston Moly Corp, 2014 SCC 53 at paras 57; see para 60. [16] Internally, a text must be understood as a whole. Aside from formal definition provisions, associated words and other clausescan shape the

interpretation of the fragment of text in question: Omers at para 33. [17] Thus we arrive at the principles of

interpretation described by the Court of Appeal in Omers. The intentions of the parties areto be determined on an objective basis, on the basis of what a reasonable person would infer from the words used, the agreement as awhole, the factual and legal background and the practical objectives that the contract was intended to achieve: Omers at para 34; seeSattva at paras 48-49. [18] For a business contract, the context-appropriate objective perspective is that of an ordinary business person.

Further, in thebusiness context, a contract should be interpreted to support a commercially sensible result, unless express language dictates otherwise(people are free to make bad deals): Omers, at para 78. [19] Parol or extrinsic evidence, evidence of what the parties claim they in fact intended, is admissible only if a contractualprovision is ambiguous, meaning that the language supports at least two reasonable

interpretations; without the evidence theinterpretation cannot be decided one way or the other: Ziegler at paras12 and 36; Nexxtep at para 20. [20] As for the contra proferentum rule referred to in argument, Justice Strekaf wrote in Jovalco Group Corp v Heritage StationInc, 2009 ABQB 577 at para 22 that [22] The rule of contra proferentem is an interpretive tool of last resort to be used only when all other means of ascertaining theintentions of the parties, as expressed by their written contract, have failed: Manulife Bank of Canada v Conlin, (SCC),[1996] 3 S.C.R. 415.

Further, the rule is to be used when there is an ambiguity in the meaning of the contract which one of the parties asthe author offers to the other, and the other has no opportunity to modify its wording: Hillis Oil & Sales Ltd v Wynn's Canada Ltd, (SCC), [1986] 1 S.C.R. 57. 2. Clause 10 of

Schedule B to the Agreement Clause 10 of

Schedule B to the Agreement provides as follows: Neither party shall, during the Term of this Agreement or for a period of one (1) year thereafter, without the prior written consent of theother party, actively solicit or offer employment to any employees or personnel of such other party or such other party’s associates oraffiliates (“Personnel”) who have been engaged in or associated with the Services provided under this Agreement.

In the event that thisprovision is violated the defaulting party shall pay to the non-defaulting party, as a genuine pre-estimate of the non-defaulting party’sloss and not as a penalty, a sum equal to twice the annual gross earnings of the Personnel while in the employment of the non-defaultingparty or its associates and such sum shall be due and payable immediately upon retention of the Personnel by the defaulting party. [21] Four elements of clause 10 and their application are not in issue. [22] First, the Term of the Agreement began March 1, 2007 and ended December 31, 2009.

By its terms, clause 10 was effectivefor a further year, until December 31, 2010. All material events took place during the Term of the Agreement. [23] Second, Services are described in

Schedule A, and include “in general” Engineering Services. There was no suggestion thatMr Pocaluyko or Mr Halldorson did not perform Services for EPCOR as described in

Schedule A to the Agreement. [24] Third, one type of conduct prohibited by clause 10 is to “offer employment.” The meaning of that phrase is not problematic.To offer employment is to offer a job or other ongoing paid position or contract of service. Mr Pocaluyko and Mr Halldorson did becomeemployees of EPCOR. Offers of employment were made to them.

When those offers were made is a live issue. [25] Finally, there is no issue respecting the meaning of the phrase “or such other party’s associates or affiliates.” [26] I add that there is no contention that clause 10 is invalid, on the basis of being contrary to public policy or otherwise. [27] Only three elements of the first sentence of clause 10 are at issue – the meanings of the terms “actively solicit”; the phrase“any employees … who have been engaged in or associated with the Services provided under this Agreement;” and the phrase “anypersonnel … who have been engaged in or associated with the Services provided under this Agreement.” 3.

Context

[ 28 ] Context or surrounding circumstances may be considered in interpreting contracts. A qualification is provided in Ledcor Construction Limited v Northbridge Indemnity Insurance Company , 2015 ABCA 121 at para 14 : [14] In cases where the parties had a real hand in negotiating a contract, one can explore the known surrounding circumstances to determine their intention, as expressed in the wording of the contract. What the parties knew or objectively ought to have known about the factual context can help explain what the wording of the contract means….

However, in many cases (particularly involving contracts of adhesion) any search for the intention of the parties in the “context” is merely a legal fiction. If the parties did not actually negotiate the terms of the contract, and were not even present when those terms were set, the process is artificial. Interpreting the contract comes back to an application of legal rules and presumptions about the meaning of particular wording. [ 29 ] In this case, clause 10 is part of a standard form “take it or leave it” contract put to Cumbria by EPCOR. Context, then, is not of significant interpretive importance.

Nonetheless, clause 10 does have a context which does help illuminate its role. [ 30 ] Clause 10 concerns a specific risk inherent in the EPCOR-contractor relationship. The risk is borne by both parties, but practically falls more heavily on independent contractor engineering firms. [ 31 ] The risk is that independent engineering firms’ employees, because of the experience and contact gained with EPCOR through secondment process, become good candidates for employment with EPCOR. Firms make money through secondments, but risk losing investments in employees through secondments.

I accept the point made in the Plaintiff’s materials that a firm like Cumbria has a “legitimate interest in maintaining a stable, trained workforce,” an interest which Cumbria was entitled to protect through a non- solicitation clause: Dawnay, Day and Co v de Braconier d’Alphen , [1997] IRLR 442; see also Callpro Canada Inc v Prima Telmatique Inc , 2001 Carswell Ont 1286 at para 76 .

According to the British Columbia Court of Appeal in Tonmar Janitorial Lt. v Empire International Investment Corp , 2004 BCCA 575 at para 9 , [9] … It seems to me that Tonmar was entitled to legitimately protect its business interests by inserting that clause in the agreement. The purpose of that clause was to prevent Empire from hiring for a time any employee or contractor used by Tonmar.

One does not have to contemplate long on this issue to see that if Empire was entitled to hire away employees of Tonmar, it would obviously be very detrimental to Tonmar continuing in the business relationship of furnishing these types of services to Empire. Clearly Tonmar inserted the clause it did in the agreement for those purposes to protect its business interest. [ 32 ] I recognize that there was evidence (through a read-in from Mr Clark’s Questioning) that “turnover” was also an issue for permanent staff. The risks dealt with by clause 10 were not only contractor risks.

Neil Cumbria’s observations respecting clause 10 were apt: “We thought our employees were being protected and their employees were protected. In our view, [clause 10] was for our mutual benefit.” [ 33 ] A secondary purpose of clause 10 from Cumbria’s perspective was protection of Cumbria’s confidential or proprietary information. Clauses 8 and 9 of

Schedule B of the Agreement protect EPCOR. Cumbria has the protection of the general law; but through the non-solicitation clause, some practical protection from information disclosure is also achieved. [ 34 ] I will also take into account as a contextual matter that, at least in 2007, the risk addressed by the non-solicitation clause was heightened. There was consensus that in 2007 there was a hot market for engineers. This meant that demand for engineering services was high. Jobs were plentiful. The market promoted the mobility of engineers. 4.

Employees [ 35 ] Does the term “employees” include not only current but former employees? [ 36 ] If the term “employees” does include former employees, little would remain for Cumbria to establish its case. Mr Pocaluyko and Mr Halldorson were, at least, former employees when the offers of employment were made. They had performed relevant Services and the offers were made during the operational period of clause 10. [ 37 ] (I hasten to add that even if Cumbria’s favoured

interpretation of the term “employees” is not accepted, Cumbria’s case would not be scuttled or completely undercut. It could yet succeed on other aspects of clause 10.) [ 38 ] The key consideration favouring an

interpretation of “employees” that embraces both current and former employees is that the term is modified by the phrase “who have been engaged in or associated with the Services provided under this Agreement.” The “have been engaged” verb form refers both to current engagement in Services and past engaging in Services. The verb form entails that clause 10 applies not only if an employee is at the time (e.g.) of an offer engaging in Services but if, during the Term of the Agreement – even early in the Term of the Agreement – the employee did engage or engaged or had engaged in Services.

The verb form, then, points to present and past Services as a condition for the application of clause 10. [ 39 ] However, the current or past provision of Services is not the sole condition for the application of clause 10. The “have been engaged” phrase modifies the term “employee.” An employee is someone who, at the time an offer of employment is made or at the time that active solicitation occurs, has the formal legal status of being in an employment relationship with the “other party” to the Agreement. This is the plain and grammatical reading of clause 10.

If clause 10 were to apply both to current and former employees, the clause could have easily referred to “employees or former employees.” In fact, this is what was done in the Tonmar case which formed part of the Plaintiff’s materials: the clause at issue in that case referred to “any present or past employees … of Tonmar Janitorial Ltd” (reproduced in the trial decision, 2003 BCSC 1753 at para 4 ). [ 40 ] This

interpretation does not deprive clause 10 of practical value. It would still on its face capture offers of employment made while an employee remains an employee of the other party – an offer need not be a formal or “official” offer; a surreptitious offer of employment could be found on the evidence to have preceded an employee’s resignation from the other party and his or her later

employment with the offering party. Further, clause 10 would still apply to active solicitation of the other party’s employees – it would still apply to the luring of employees. [ 41 ] The plain reading of clause 10 permits it to retain commercial efficacy. It also supports the mobility of workers between employers and prevents workers from being unreasonably denied employment opportunities. The plain reading also ensures that an “other party” has an existing economic and practical interest relating to the worker who changes jobs.

If a worker is no longer an employee, no longer in a legal relationship with the “other party,” the other party has a diminished interest in restraining the employment choices of that worker.

Further, the modification of the term “employee” by the “have been engaged” language prevents the clause from applying to employees who have had no contact with the future employer during their employment with the other party. [ 42 ] At the same time, the plain reading of clause 10 protects the “other party.” So long as it maintains an employment relationship with an individual who, on behalf of the other party, is providing Services, EPCOR cannot actively solicit or offer employment to that individual. [ 43 ] Of course, an “other party” may still have real legal interests relating to information possessed by a former employee.

Those interests, though, are not so much protected by clause 10 as by the general law. [ 44 ] As EPCOR argued, Cumbria’s

interpretation (whereby “employee” included both current and former employees) would have implications that would not make commercial sense. Cumbria, for example, could terminate an engineer who had provided Services to EPCOR for a very short period at the beginning of the Term of the Agreement. That engineer could not be hired by EPCOR until years later - a year after the Term of the Agreement had expired. Cumbria would have no employment relationship to protect, yet the former employee would be forbidden from improving his or her economic position through employment with EPCOR.

Again, insofar as Cumbria had concerns respecting confidential information or valuable business information, it could rely on the general law. 5.

Personnel [ 45 ] Similar arguments apply respecting the scope of the term “Personnel.” For clause 10 to be engaged, these individuals, when solicited or when they receive an offer, must be “personnel of such other party,” not former personnel. [ 46 ] A plain reading of clause 10 would not permit the term “employee” to refer to a contemporaneous relationship but expand the parallel term “personnel” both to a contemporaneous and a former or past relationship. [ 47 ] The term “Personnel” is used in clause 10 to capture individuals who have a formal legal relationship with an “other party” that is not an employment relationship.

This would include, for example, individuals with contracts for services or independent contractors with the other party. On the evidence in this case, Horst Glombick was a non-employee independent contractor with Cumbria who provided Services to EPCOR under the Agreement. Clause 10 could apply to an individual in the position of Mr Glombick. 6.

Actively Solicit [ 48 ] “Actively” soliciting must be distinguished from “passive soliciting” or perhaps from mere “soliciting.” The term “actively” suggests that some positive act, steps, or conduct, some “overt act” of soliciting must be involved, as contrasted with merely (e.g.) attracting a person through general desirability. [ 49 ] Soliciting, especially as modified by “actively,” connotes addressing conduct to another person or at defined group of persons.

We do not simply “solicit.” We solicit someone else or members of a group. [ 50 ] Soliciting involves asking, urging, prevailing on, trying to obtain, trying to sell, trying to obtain benefits (whether goods, services, or money) from another. A feature of soliciting is that it is an attempt to convince another person to provide some benefit that will satisfy or partially satisfy some need or interest of the person soliciting.

It involves requesting or urging for the purposes of satisfying some interest or end of the person doing the soliciting. [ 51 ] The decision of Justice Pentelechuk in IBM Canada Ltd v Almond , 2015 ABQB 336 provides a useful discussion of the notion of “soliciting”, commencing at para 74.

Justice Pentelechuk quotes from Investors Group Financial Services Inc v Smith where “solicit” is defined as [74] …. to appeal for something; to apply to for [sic] obtaining something; to ask earnestly; to ask for the purpose of receiving; to endeavour to obtain by asking or pleading; to entreat, implore, or importune; to make petition to; to plead for; to try to obtain ( [1994] NSJ No 466 at para 21 ) ….

Justice Pentelechuk continues at para 75: [75] … the term “solicitation” is defined as “[t]he act or an instance of requesting or seeking to obtain something” [as stated in Black's Law Dictionary ]…; and observes at para 76 that [76] These

definitions suggest that solicitation involves an active step or overt action. [ 52 ] At para 77 she goes on to discuss the Court of Appeal decision in Burns and Alberta Chiropractic Association , where solicitation was defined as “to endeavour to obtain by asking:” 1981 ABCA 194 at para 4 . She refers to Epilepsy Canada v Alberta (Attorney General) , 1994 ABCA 246 : In that case, Côté, JA, for the Court, looked to the Oxford Dictionary definition and concluded that solicitation need not involve

widespread and repeated activity and that isolated or occasional acts can amount to solicitation. Further, in Investors Group FinancialServices Inc v Smith … the definition of “solicit” was considered in the context of a non-solicitation agreement imposed on anemployee.

The former employee sent letter to a large number of clients using the client list, while still employed with his formeremployer advising them he was no longer employed with Investors Group and could be reached at home if the clients had any questions.As specific instructions were provided in the event the clients wanted to know more about the employee’s new company, the Court heldhis actions did not constitute solicitation. [53] In Dr P Andreou Inc v McCaig, 2007 BCCA 159, Justice Huddart wrote as follows at para 35: [35] I also find support for my view that “something more” than a general advertisement is needed to constitute a breach of a non-solicitation covenant in the opinion of Lamer C.J.C. in Committee for the Commonwealth of Canada v.

Canada, (SCC), [1991] 1 S.C.R. 139 … [where the Chief Justice stated that] it can be seen that the word "sollicitation" necessarily implies a request or invitation. It in fact refers to conduct for the purpose ofinciting someone to do something, characterized by some pressing request, commercial or otherwise, in nature. [54] Finally, the meaning of the term “actively solicit” in clause 10 is coloured by its context: “actively solicit or offer employmentto any employees or personnel of such other party.” The solicitation relates to employment. Solicitation to donate to a charity, forexample, would not be covered.

The type of solicitation contemplated is luring, pre-offer preparation, taking steps to cause an employeeto be interested - all for the purpose of inclining the person solicited to pursue employment, without having made an actual offer ofemployment. [55] Given my

interpretation of clause 10, the liability issues are whether, while Mr Pocaluyko and Mr Halldorson wereemployees, EPCOR either offered them employment or actively solicited them with a view to employ them. There is no direct evidence,such as an admission by e-mail or a definitive audio-visual recording, that captures pre-resignation offers or solicitation by EPCOR. [56] As shall be seen, the case against EPCOR is circumstantial.

On the basis of the evidence as a whole, is it likely or moreprobable than not that EPCOR either made offers of employment to Mr Pocaluyko or Mr Halldorson prior to their resignations fromCumbria or that EPCOR actively solicited Mr Pocaluyko or Mr Halldorson prior to their resignations from Cumbria? B. THE HIRING OF MR Pocaluyko [57] I’ll consider first the Defendant’s narrative, the way events appeared to have transpired.

I’ll then consider whether I shouldfind that EPCOR actively solicited Mr Pocaluyko or whether EPCOR in fact made him an offer of employment prior to Mr Pocaluyko’sapparent resignation from Cumbria.

(1) DEFENDANT’S NARRATIVE 1. Work with Cumbria [58] It is common ground that Mr Pocaluyko was hired by Cumbria in 2001. He was a Cumbria employee seconded to EPCOR in2007 during the Term of the Agreement. Mr Pocaluyko worked in the EPCOR offices in the Toronto Dominion Tower in downtownEdmonton. Mr Pocaluyko reported to Mr Gilevich, the manager of Mechanical Engineering, who in turn reported to Mr Clark, a seniormanager in charge of Civil, Mechanical, and Environmental Engineering. [59] Mr Pocaluyko was the “point man” or communication liaison between EPCOR and Cumbria.

He was the lead mechanicalengineer for Cumbria at EPCOR, to whom a number of other Cumbria engineers seconded to EPCOR reported. He also worked onprojects assigned by EPCOR. Specifically, he worked on the design phase of a g3 air preheater project. [60] Mr Pocaluyko, it is fair to say, had achieved a position of significant seniority and responsibility, at least in the relationshipbetween Cumbria and EPCOR. 2.

Friction [61] Friction, however, arose between Mr Pocaluyko and Walter Cumbria. [62] One source of friction was that Walter Cumbria required weekly in-person meetings with Cumbria employees at Cumbriaoffices. Mr Pocaluyko’s view was that these meetings were not necessary since the information relayed at the meetings was conveyedelectronically. From Mr Pocaluyko’s perspective, which, it appears, was conveyed to Walter Cumbria, the meetings were a poor use ofvaluable time.

Walter Cumbria’s perspective, in contrast, was that the meetings were valuable and provided an opportunity for him toaddress and correct emerging issues – for which, as the employer, he was ultimately responsible. Walter Cumbria was also upset with MrPocaluyko’s attitude. [63] From Cumbria’s perspective, the meetings issue fit into a broader concern relating to Mr Pocaluyko. Walter Cumbria andNeil Cumbria were of the opinion that Mr Pocaluyko had or believed he had too much work.

This concern tied the meetings issue to asecond source of friction. [64] A second source of friction, according to Walter Cumbria, was that Mr Pocaluyko was blocking or preventing new work from

coming to Cumbria. Mr Pocaluyko was too busy, so he felt that Cumbria could not take on new projects made available by EPCOR. [ 65 ] Walter Cumbria commented that Mr Pocaluyko made unflattering remarks about fellow engineers at Cumbria in connection with taking on new work; Walter Cumbria also alleged that Mr Pocaluyko made unflattering remarks about Mr Gilevich.

There was no evidence corroborating the claim that Mr Pocaluyko made such remarks or that the remarks reflected his attitude towards his co-workers at Cumbria or at EPCOR. [ 66 ] There was no evidence supporting Walter Cumbria’s claims that Mr Pocaluyko was blocking or preventing new work from coming to Cumbria. Admittedly, Cumbria was at an evidential disadvantage – proving what jobs it did not get but could have gotten is difficult.

Mr Gilevich and Mr Pocaluyko flatly denied the blocking allegation. 3. the Reorganization [ 67 ] Regardless, by October 15, 2007, Walter Cumbria was sufficiently concerned with Mr Pocaluyko that he decided that a “reorganization” was in order. He travelled to EPCOR’s Genesee 3 plant near Wabamun Lake where other Cumbria employees were seconded. Using another Cumbria engineer’s computer, Walter Cumbria sent an e-mail to Mr Pocaluyko and others taking away Mr Pocaluyko’s supervisory responsibilities over 4 other Cumbria engineers (including Mr Halldorson) – i.e., he took away four of Mr Pocaluyko’s “reports”.

Three engineers were re-assigned to report to Mr Halldorson, who in turn was to report to Walter Cumbria. [ 68 ] As Neil Cumbria wryly remarked, these changes were “not well received.” 4. Reaction [ 69 ] Mr Pocaluyko tried initially unsuccessfully to contact Walter Cumbria. He was able to contact Mr Gilevich by e-mail. On October 15, Mr Gilevich sent an e-mail providing EPCOR’s perspective on reporting structures for technical services.

Walter Cumbria viewed this e-mail as delivering a “scolding” to him. [ 70 ] Following an e-mail exchange on October 16 and 17, Mr Pocaluyko and Walter Cumbria had a telephone conversation on October 17, 2007. The accounts differ about who was calm and who was aggressive and angry, but the conclusion of the conversation is not contested: Mr Pocaluyko said “I quit” and Walter Cumbria said “good.” [ 71 ] Walter Cumbria testified that he called Mr Pocaluyko several times afterwards, trying to smooth out the situation.

He was even prepared to permit Mr Pocaluyko to stay until he found a job, but Mr Pocaluyko declined. 5. Post-Termination (

a) the posting [ 72 ] Mr Pocaluyko’s evidence was that at the time of quitting, he had no plan for future employment. After quitting, though, he went onto the EPCOR website. [ 73 ] EPCOR had put up a job posting for two mechanical engineers on September 28, 2007. The job was posted in September, but the posting was closing on October 19, 2007. The posting was not only on the EPCOR website, where it was viewed by Mr Pocaluyko, but on some other job-search websites. [ 74 ] Mr Pocaluyko applied for the EPCOR position on October 18, 2007. (

b) the interview [ 75 ] About 100 candidates applied for the EPCOR positions. Mr Gilevich had the responsibility of reviewing the applications and making an initial decision about applicants to be interviewed. His recommendations respecting the short list had to be approved by Mr Clark. [ 76 ] A short list of four candidates was established. This included Mr Pocaluyko and – as will be described in greater detail below – Mr Halldorson, as well as two others whose names no witness could recall. [ 77 ] Mr Pocaluyko was interviewed on October 30.

The interview used standardized questions prepared by the EPCOR HR department. [ 78 ] About a week later, Mr Pocaluyko was offered a position by EPCOR which he accepted. Mr Pocaluyko began work as an EPCOR employee on November 30, 2007. (

c) no pre-termination solicitation or employment assurances [ 79 ] Mr Pocaluyko has denied having any knowledge of the Agreement or its terms and there was no evidence that he had knowledge of the Agreement or its terms prior to this litigation. Mr Pocaluyko denied communicating with EPCOR about employment until after his job with Cumbria had ended. Mr Gilevich denied that he promised a job to Mr Pocaluyko before he resigned from

Cumbria. Mr Clark similarly denied that he talked to Mr Pocaluyko respecting employment opportunities with EPCOR before Mr Pocaluyko resigned from Cumbria. (

d) post-hiring call: Walter Cumbria and EPCOR representatives [ 80 ] On November 30, Walter Cumbria had a telephone conversation with Mr Gilevich and Mr Clark about EPCOR’s hiring of Mr Pocaluyko. The accounts of the conversation differ. Walter Cumbria recalls that he was firm but diplomatic, as he needed to be with a valued client. Mr Gilevich and Mr Clark testified that Walter Cumbria was angry and irrational in the call. It is common ground that Mr Gilevich and Mr Clark eventually hung up on Walter Cumbria.

Nothing said by Mr Gilivich or Mr Clark in this call in any way undercut or contradicted the Defendant’s position. [ 81 ] To this point, it would seem that clause 10 had no purchase. Mr Pocaluyko quit. He had ceased to be a Cumbria employee before he applied for and obtained employment with EPCOR. It appears that there was no pre-resignation active solicitation of Mr Pocaluyko and no offer of employment was made before he resigned. [ 82 ] Cumbria points to evidence, however, from which it could be inferred that the narrative Mr Pocaluyko and EPCOR provided did not provide a complete account of the facts.

Cumbria argues that it can be inferred that Mr Pocaluyko and EPCOR had established a position for Mr Pocaluyko with EPCOR, and the narrative provided was really just a form of cover-up.

(2) PLAINTIFF’S CIRCUMSTANTIAL CASE FOR PRE- RESIGNATION OFFER OR SOLICITATION [ 83 ] I’ll review the evidence pointed to by Cumbria, but indicate as well contrary inferences that can be drawn from the evidence. 1. Cui Bono ? [ 84 ] At the base of Cumbria’s circumstantial case is a question derived from Cicero, who remarks on its use by Lucius Cassius in criminal trials, respecting motive as evidence identifying a perpetrator: cui bono – who benefits? ( Second Philippic , XIV) When trying to work out what occurred, or better, why what occurred did occur, one should determine who benefits.

The suggestion is that the persons who benefited set up events to secure those benefits. [ 85 ] Who benefited from the departures of Mr Pocaluyko and Mr Halldorson? [ 86 ] To a large degree, EPCOR benefited. It got two good engineers. Both are still working for EPCOR. Mr Pocaluyko is a senior manager of turn-arounds. Mr Halldorson is working from Edmonton on a steam turbine overhaul in Williams Lake, BC. [ 87 ] Mr Pocaluyko and Mr Halldorson had been hired by Cumbria out of Engineering School and had been mentored by Walter Cumbria.

They benefited from the experience Cumbria could provide to them in the power generation industry, particularly respecting plant turn-arounds. [ 88 ] They had the benefit through working with Cumbria of working with EPCOR on EPCOR projects – learning the EPCOR systems and processes while employed by Cumbria. Through their secondment EPCOR was able to gain a good appreciation of their talents. [ 89 ] Mr Pocaluyko and Mr Halldorson also significantly benefited from the move to EPCOR. Cumbria could not offer the compensation of an EPCOR.

Cumbria had no pension plan, no health benefits, and no profit sharing, although Neil Cumbria testified that Cumbria did pay bonuses when bonuses could be afforded. Walter Cumbria testified that Cumbria did take employees for lunch every Friday, held a Christmas party, paid for employees’ parking and for their protective clothing. [ 90 ] The party that did not benefit from the departures of Mr Pocaluyko and Mr Halldorson was Cumbria. [ 91 ] The cui bono question at best raises only a suspicion. A party like EPCOR may benefit simply as a result of the way circumstances turned out, independently of its agency.

It could be the happy beneficiary of others’ decisions and actions. Evidence is required to determine whether in fact the persons who benefited actually took steps to secure their benefits. 2. Circumstantial Evidence [ 92 ] Cumbria sought to rely on the following circumstantial evidence. (

a) the source of friction [ 93 ] An issue explored in the cross-examination of Mr Pocaluyko was whether there was a reasonable basis for Mr Pocaluyko’s alleged views respecting the weekly meetings. Mr Pocaluyko had only to drive from downtown Edmonton to the west end offices of Cumbria, in the vicinity of 175 street and 107 avenue. The meetings were not long. The total time expenditure was only about, at maximum, three hours. A point of this part of the cross-examination was that the meetings were only a minor inconvenience. The inference urged was that Mr Pocaluyko did not in fact hold the views he expressed.

This inference would be supported by the alleged unreasonableness of the view that the meetings were a waste of time. The reasonableness or unreasonableness of an inference is some

circumstantial evidence of whether the inference should be drawn and the strength of the inference. [ 94 ] However, I find that the time spent on meetings coupled with Mr Pocaluyko’s explanation for viewing the meetings as unnecessary allows me to conclude that Mr Pocaluyko’s views were in fact held and were sincerely held. Taking two or three hours out of a full day is a big time expenditure. Since on the evidence the meetings concerned at least in significant

part information sent electronically at an earlier time, a reasonable concern could arise that the meetings were not a good time expenditure. (

b) the posting [ 95 ] Cumbria urged, in effect, that the posting to which Mr Pocaluyko (and Mr Halldorson) responded was, to some degree, a sham. The posting specified that candidates were to have 10 years’ experience. Yet Mr Pocaluyko did not and neither did Mr Halldorson. Mr Pocaluyko had six years’ experience and Mr Halldorson had five. [ 96 ] The posting was real. It went up on September 28, 2007, before the difficulties arose between Mr Pocaluyko or Mr Halldorson and Cumbria. On the evidence, there were about 100 applications. This was according to Mr Clark and Mr Gilevich’s testimony.

It is true that documentation corroborating the 100 application claim was not made an exhibit but neither was the 100 application claim challenged during cross-examination. [ 97 ] The 10 year requirement was, according to Mr Gilevich and Mr Clark, a filter. It was designed to deter unqualified applicants.

As it turned out, it was not much of a deterrent since applicants with a wide variety of qualifications applied, at least some of whom had less than 10 years’ experience. [ 98 ] It is true that the posting did not provide that the years of experience were a “guideline.” [ 99 ] However, I find that the posting and the

interpretation placed on it by Mr Gilevich and Mr Clark were entirely reasonable and entirely within the scope of practice of corporate job searches. The ad goes out, referring to a specified set of qualifications; those on the search team have the job of dealing with the credentials of those who actually apply. [ 100 ] Furthermore, I find that it was entirely reasonable for EPCOR to view Mr Pocaluyko’s and Mr Halldorson’s qualifications as being the equivalent of those specified in the posting. They had already worked with EPCOR on its projects and had proven their professional value. Their experience was the equivalent of additional years of unrelated or differently related experience. (

c) hiring freeze [ 101 ] There was evidence that EPCOR had imposed a hiring freeze, to be effective January 2008. This would have put pressure on Mr Gilevich and Mr Clark to hire mechanical engineers before the end of 2007, while they still could. [ 102 ] Yet they developed a short list of only four candidates, two of whom were Mr Pocaluyko and Mr Halldorson. That number was based on the assessment by Mr Gilevich, seconded by Mr Clark, of the quality of the 100 or so candidates.

If four were the maximum number of qualified applicants, it would have been pointless to interview other unsatisfactory applicants. [ 103 ] Mr Pocaluyko was hired shortly after the posting closed and interviews were held. The hiring freeze and the small candidate pool do not generate adverse inferences relating to the validity of his job application. (

d) Mr Pocaluyko’s job conditions at EPCOR [ 104 ] When Mr Pocaluyko returned to EPCOR he was assigned the same project as when he left. No other engineer was assigned to this project during the weeks after Mr Pocaluyko left Cumbria and November 30, when Mr Pocaluyko started work with EPCOR. [ 105 ] Mr Pocaluyko returned to the same desk, the same cubicle, with apparently the same materials sitting at his work station as when he left. Further, he had, it appears, the same EPCOR e-mail address and phone number before he left as when he returned.

It was as if his place at EPCOR was being kept for him. [ 106 ] As for the project, the response was twofold. First, Mr Pocaluyko was not working on precisely the same project pre- termination from Cumbria and once he became employed by EPCOR. Initially he had been working on the design phase of the air preheater project. He was now working on the execution phase of the air preheater project. These were two distinct phases of the project. One engineer would not necessary be tasked with both phases. [ 107 ] Second, it would make sense for EPCOR to bring Mr Pocaluyko back to a project with which he had familiarity.

Since, as it appears, there was some further work to be done in relation to the air preheater project, even though it was for a different phase of the project, it would be reasonable for EPCOR to rely on an engineer that had worked on a prior phase of the project. Moreover, the project was not left unassigned for a full six weeks. Mr Pocaluyko ended his employment with Cumbria on October 17. By October 30, he had interviewed.

By about November 6 he was hired, although his start-date was November 30. [ 108 ] Finally on this point, the evidence was that the first design phase of the air preheater project was completed. It was not left incomplete, waiting for a new hire to finish it off. [ 109 ] As for the physical location of Mr Pocaluyko when he returned to the EPCOR offices, the evidence did not address in any detailed way what occurs when a cubicle’s occupant ceased employment in the TD office.

It appears that the cubicle and its contents sat undisturbed for about six weeks before Mr Pocaluyko returned to the cubicle (keeping in mind that after 3 weeks Mr Pocaluyko had been offered the EPCOR job and would be returning to the Technical Services office in TD Tower). There was no evidence, though, that

the cubicle was left undisturbed for any ulterior purpose. There was no evidence that this particular spot was needed or could have been used by any other employee. In fact, at the time the Mechanical Engineering department was looking to hire two engineers. A hiring process was in gear. The unit was understaffed at the time, not crying for space. 3.

Conclusion Respecting the Circumstantial Evidence [ 110 ] Cumbria’s argument respecting pre-termination active solicitation or offer of employment is based on circumstantial evidence. [ 111 ] I do not deny that inferences urged could be drawn. [ 112 ] Cumbria, however, bears the burden of proof. It must establish that its account of the facts is likely or probable – more probable than the version of the facts advanced by EPCOR.

It is not enough for Cumbria simply to raise a reasonable doubt. [ 113 ] In assessing whether Cumbria has discharged its burden of proof, I must consider all of the evidence and not apply the burden of proof piecemeal to individual elements of evidence. This is particularly important in circumstantial evidence cases. [ 114 ] That being said, I must keep in mind that the project assignment and cubicle evidence relied on by Cumbria are forms of after- the-fact circumstantial evidence. Again, I don’t deny that relevant inferences may be drawn, but such evidence must be approached with care.

Its probative value may appear to be deceptively high. [ 115 ] The evidence supports inferences of innocent hiring of Mr Pocaluyko by EPCOR. Mr Pocaluyko quit Cumbria. The evidence strongly supports that he did indeed quit, based on a real conflict with Walter Cumbria. Walter Cumbria did strip Mr Pocaluyko of his reports save one, which initiated the series of communications that led to Mr Pocaluyko’s resignation. Indeed, while this point was not pursued in argument, the stripping of the reports might itself have constituted constructive dismissal of Mr Pocaluyko.

Mr Pocaluyko’s job with Cumbria was over. [ 116 ] Mr Pocaluyko responded to a real job posting. It had been out for some months. He went through a standard interview process. [ 117 ] Mr Pocaluyko did not have the qualifications specified in the posting, but he had experience with EPCOR that was equivalent. He was a known quantity. As a prospective employer, EPCOR’s response to Mr Pocaluyko’s application was entirely reasonable. [ 118 ] Of course hiring Mr Pocaluyko was a great benefit to EPCOR.

It received not only a well-trained engineer, but one well-trained respecting the very type of projects that EPCOR was working on. It made perfect sense to keep Mr Pocaluyko working on the air preheater project, a project with which he had experience. [ 119 ] There was nothing sinister about the unaltered state of Mr Pocaluyko’s cubicle. EPCOR had been looking for mechanical engineers. It did not have a surplus of engineers in-house who needed a cubicle.

There was no evidence that the cubicle and its materials were being preserved for Mr Pocaluyko, as opposed to the cubicle and its materials simply sitting as hiring procedures moved along. The fact was that the cubicle and its contents just sat. There was evidence that EPCOR could be “slothful” at changing up at least telephones for departed staff. The cubicle sat for only about three weeks before Mr Pocaluyko was hired by EPCOR.

Given that the cubicle had stayed in its same condition as when Mr Pocaluyko left, it would have made perfect sense to return Mr Pocaluyko to that cubicle, rather than move him to another. [ 120 ] In all the circumstances, I do not find that it was likely that EPCOR and Mr Pocaluyko engaged in behind-the-scenes discussions, putting in place employment with EPCOR, some sort of secret deal, before Mr Pocaluyko left Cumbria. [ 121 ] I therefore find that Mr Pocaluyko had quit Cumbria before EPCOR made any offer of employment to him.

I find that EPCOR did not actively solicit or solicit Mr Pocaluyko in any fashion falling within the meaning of clause 10 before Mr Pocaluyko terminated his employment with Cumbria. [ 122 ] I therefore find that, as regards the hiring of Mr Pocaluyko, EPCOR did not violate clause 10 of the Agreement. C. THE HIRING OF MR H alldorson 1.

Resignation from Cumbria [ 123 ] Again, I will begin with EPCOR’s narrative, then determine whether the evidence supports the findings that EPCOR had engaged in active solicitation of Mr Halldorson while he was still a Cumbria employee or whether EPCOR had made a job offer to Mr Halldorson while he was still a Cumbria employee. [ 124 ] Mr Halldorson, a Cumbria employee since 2002, had been seconded to EPCOR, working at Genesee in 2007. [ 125 ] Unlike Mr Pocaluyko, he did not reach a dramatic point of no return with Cumbria. [ 126 ] In the latter part of 2007, Mr Halldorson was aware that there was a hot market for engineers.

That is, he knew that he had reasonable prospects of getting another job should he leave Cumbria. Mr Halldorson had in fact been looking for work with other firms since 2006. In November 2006 he applied for a position with Atco. Although he was interviewed, this bid for new employment was not successful. [ 127 ] Mr Halldorson, I note, had been pulled in on a day off when Walter Cumbria came to Genesee and did the reorganization on

October 15. Mr Pocaluyko’s reports had been re-assigned to Mr Halldorson. The employment instability demonstrated by this incident could have influenced Mr Halldorson’s subsequent actions. His application to EPCOR was fast on the heels of Mr Pocaluyko’s application. [ 128 ] In any event, Mr Halldorson’s stated reasons for seeking a new position were financial. He felt he was underpaid, given his review of an Association of Professional Engineers and Geoscientists of Alberta salary survey. Better compensation could be available from other employers. And he was tired of driving to and from Genesee.

He felt that there was no career growth left for him at Cumbria. Moreover, it would be easier to look for a new job if he did not have to work from Genesee. [ 129 ] Thus, in the same week as Mr Pocaluyko applied to EPCOR, on the day after Mr Pocaluyko applied, on October 19, 2007, Mr Halldorson applied to EPCOR. He responded to the same posting as Mr Pocaluyko.

Indeed, Mr Halldorson testified that he and Mr Pocaluyko had talked about the EPCOR opening prior to either of them applying for a position. [ 130 ] The evidence of Mr Gilevich and Mr Clark was that they were surprised that Mr Halldorson had applied for a position with EPCOR. They were fully aware that they could not extend an offer of employment to him while he was a Cumbria employee, but they wanted to find out why it was that he was applying.

It should be borne in mind that Mr Pocaluyko had applied for and been short-listed for a job with EPCOR at about this very time. [ 131 ] Significantly – and I will return to this issue below – Mr Halldorson was also interviewed by EPCOR on October 30, 2007. The interview questions, on the evidence, were the standard HR composed questions. Compensation was not discussed. At this time, Mr Halldorson was still a Cumbria employee.

The evidence of Mr Gilewich and Mr Clark was that EPCOR did not make a job offer to Mr Halldorson at this time. [ 132 ] Mr Gilewich and Mr Clark wished to follow the strictures of clause 10 as they understood it. They knew that if they wanted to make a job offer to Mr Halldorson they would have to have Cumbria’s prior permission in writing. Before seeking that permission, though – given that Mr Halldorson was still a Cumbria employee – EPCOR would require Mr Halldorson’s consent to proceed with contacting Cumbria.

Mr Gilevich therefore asked Mr Halldorson to provide a consent within about two weeks from Mr Halldorson’s interview. Mr Halldorson initially did prepare a consent on November 27, 2007. The next day, on November 28, before EPCOR contacted Cumbria about Mr Halldorson, he rescinded the consent. [ 133 ] EPCOR’s evidence, then, was that further processing of Mr Halldorson’s employment application ceased. [ 134 ] On November 29, 2007, Mr Halldorson resigned from Cumbria giving two weeks notice. He indicated that he was resigning for personal reasons.

He was going to enjoy the holidays and start looking for a job in New Year. [ 135 ] Neil Cumbria initially received Mr Halldorson’s resignation. Walter Cumbria learned of his resignation. He and Neil Cumbria went to Genesee to talk to Mr Halldorson about the resignation. I’ll return to this matter below. [ 136 ] EPCOR was notified of Mr Halldorson’s resignation. Mr Halldorson’s testimony was that he contacted Mr Gilewich about his resignation and the transitioning of his files. Mr Gilewich’s evidence is not consistent with Mr Halldorson’s on this point.

Mr Gilewich denied contact with Mr Halldorson between December 3 and December 21. The evidence indicates that Neil Cumbria sent an e-mail to Mr Clark on December 3, 2007 advising that Mr Halldorson had resigned. I do not view the inconsistency between Mr Gilevich’s evidence and Mr Halldorson’s evidence respecting the notification to be fatal. Mr Halldorson volunteered the evidence of contact with Mr Gilewich. He was not trying to hide it. It would not be unusual for a witness not to recall a phone conversation that took place some 8 years before testifying.

Mr Gilewich and EPCOR had been advised of Mr Halldorson’s resignation. That permitted EPCOR to re-engage processes respecting Mr Halldorson’s application. The hiring of Mr Halldorson was not, as it was referred to in argument, out of the blue. It simply followed the chain of evidence in the process that unfolded. [ 137 ] On December 21, 2007 EPCOR offered a position to Mr Halldorson. He commenced working for EPCOR on January 2, 2008. [ 138 ] Unlike Mr Pocaluyko, Mr Halldorson did not go into the very same type of job as he had been doing as a Cumbria employee when seconded to Genesee.

Mr Halldorson’s testimony was that he had come across the EPCOR job posting on his own. He had not talked to anyone at EPCOR about resigning. He was not offered a job with EPCOR before resigning. [ 139 ] Like Mr Pocaluyko, he did not have any information about the Agreement prior to this litigation. 2. Circumstantial Evidence [ 140 ] Some features of the Halldorson narrative overlap with the Pocaluyko narrative – the job posting, Mr Halldorson’s qualifications for the job at offer, and the overall benefit EPCOR received by hiring an engineer with proven experience in EPCOR’s own power plant.

I will not repeat my assessment of these factors here. The hiring freeze evidence operates in favour of the legitimacy of his application. EPCOR had only the small pool of qualified persons to work with and the competition was closed. EPCOR learned of Mr Halldorson’s resignation and processed his application quickly, getting him in place before the hiring freeze took effect. [ 141 ] Cumbria points to three problematic features of the Halldorson narrative that could be relied on to establish that EPCOR did violate clause 10 in its dealings with Mr Halldorson - (

a) the interview, (

b) the interrogation at Genesee, and (

c) the time sheet. (

a) the interview [ 142 ] The evidence does not suggest any violation of clause 10 relating to Mr Halldorson in connection with his application for a position with EPCOR or in connection with the internal EPCOR decision to short-list Mr Halldorson and to interview him. The

application was undertaken by Mr Halldorson himself, without any evidence of any encouragement by EPCOR. Mr Halldorson went to EPCOR; EPCOR did not go to him. There was no evidence that anyone from EPCOR suggested to Mr Halldorson that he should apply for a position with EPCOR or that Mr Halldorson had a good chance for employment by EPCOR if he applied.

To the point when Mr Halldorson’s application landed on Mr Gilewich’s desk (or into the “bucket” of applications to be reviewed by Mr Gilewich), EPCOR had not “actively solicited” Mr Halldorson. [ 143 ] The internal decision to interview him involved no communication to or encouragement of Mr Halldorson by EPCOR. That decision could not be active solicitation. [ 144 ] The issue is whether the interview of Mr Halldorson by Mr Gilewich and Mr Clark constituted “active solicitation” in the requisite sense. [ 145 ] EPCOR did talk to Mr Halldorson. It did solicit information from him during the interview.

A stated reason for the interview was to determine why Mr Halldorson was applying for the job. This motivation makes perfect sense. Mr Pocaluyko had recently left Cumbria and applied for a job with EPCOR. Now Halldorson had applied. Cumbria was one of EPCOR’s contractors. Even one engineer leaving Cumbria would have raised concerns for EPCOR. EPCOR had an interest in knowing what was afoot with Cumbria and why good engineers were leaving. [ 146 ] Mere communication by EPCOR with Mr Halldorson did not violate clause 10. Mere solicitation – e.g. of information – did not violate clause 10.

The question is whether the interview was “active solicitation” for the purposes of employing Mr Halldorson. [ 147 ] In my opinion, the asking of questions in the interview did not constitute active solicitation of Mr Halldorson. Again, Mr Halldorson came to EPCOR. EPCOR did not come to him. On the evidence, the interview was used by EPCOR to gather information. It did not involve any encouragements or inducements to Mr Halldorson to join EPCOR. He already had the desire to join EPCOR. Mr Gilewich and Mr Clark’s evidence was that compensation was not discussed.

Returning to the discussion of “solicit” in Justice Pentelechuk’s IBM decision and Investors Group Financial Services Inc v Smith , “solicit”is defined as: “to appeal for something; to apply … for obtaining something; to ask earnestly; to ask for the purpose of receiving; to endeavour to obtain by asking or pleading; to entreat, implore, or importune; to make petition to; to plead for; to try to obtain.” [ 148 ] In the interview, EPCOR was not appealing, asking, pleading, entreating, imploring, or petitioning Mr Halldorson to become an employee. He had asked EPCOR to become an employee.

EPCOR simply gathered information. One might say that EPCOR was engaged in a different set of speech acts than are involved when soliciting for employment. [ 149 ] Mr Halldorson had been short-listed. He had been asked to attend for an interview. That could very certainly have given him a psychological boost and conveyed that he had a reasonable chance for a position with EPCOR. However, again, EPCOR was the not the active party in this transaction. It was reacting to Mr Halldorson’s solicitation.

While an effect of the interview might have been to convey that a position might be open to Mr Halldorson, there was no assurance that a position would be offered. Being short-listed is not the same as being offered a job. Neither is the communication of a decision to interview and the communication (implicit as it may be) that a candidate has been short listed an active solicitation of that candidate. Again, the candidate has already come on his or her own to the prospective employer. And communicating that a person is being considered is not the equivalent of asking a person to work for the employer.

It is not a request or an ask – it is a statement of fact, whatever the candidate makes of it. [ 150 ] EPCOR did not actively solicit Mr Halldorson through the interview. (

b) the interrogation at Genesee [ 151 ] In the afternoon of November 29, 2007, after Mr Halldorson submitted his resignation, Walter Cumbria and Neil Cumbria went out to Genesee to talk to Mr Halldorson about his resignation. The evidence of Neil Cumbria was that Mr Halldorson was asked repeatedly whether he had another job. He repeatedly said No. Finally, though, after one last repetition of the question, he said Yes. He denied that the new employer as EPCOR. Neil Cumbria maintained this evidence despite cross-examination. Walter Cumbria maintained the same evidence.

Mr Halldorson, on the other hand, denies having confirmed that he had another job. [ 152 ] On the evidence of Neil and Walter Cumbria, we have evidence that approaches an admission of a pre-resignation offer of employment. Mr Halldorson did not, on either Neil or Walter Cumbria’s evidence, state that the other job was with EPCOR. In fact, he denied that connection.

That connection, though, could be inferred. [ 153 ] I do not find that this evidence of the interrogation at Genesee establishes that EPCOR made a pre-resignation offer of employment to Mr Halldorson, for the following reasons. [ 154 ] First, the other evidence in the case strongly supports the inference that EPCOR had not made an offer of employment to Mr Halldorson until December 21. Mr Gilewich and Mr Clark had been at pains to ensure that they were following clause 10. They were interested in pursuing Mr Halldorson’s employment prospects with EPCOR but they knew they needed Cumbria’s prior permission.

To that end, they sought a consent from Mr Halldorson to talk to Cumbria. Mr Halldorson was given the opportunity both to compose that consent and to rescind it. [ 155 ] Second, if Mr Halldorson did make the admission claimed, I am not bound to find that it was accurate. Indeed, Cumbria’s position depends on the admission being inaccurate, since he was said to have denied that EPCOR was his employer. Given the other evidence in the case, if he did make the admission, he was not accurate. He did not have another job offer in hand when he resigned. He just said that he did. Why would he have said this?

Consider the circumstances. He was working that afternoon at Genesee. In come Neil Cumbria and Walter Cumbria, the two senior people in his firm. They ask him repeatedly whether he had another job. On their evidence, he denied this until finally he said Yes, without identifying the new employer. While Cumbria in a civil trial need not establish

voluntariness on the level of the Crown in a criminal trial, I find that this interrogation procedure did not yield reliable evidence. [ 156 ] Furthermore, I do not find that it is established that Mr Halldorson did say Yes as alleged. The Cumbrias say he did. Mr Halldorson denies it. Neither side was budged in cross-examination. The evidence does not corroborate the alleged admission. On this critical piece of evidence, I find that the burden of proof on Cumbria has not been satisfied. (

c) the time sheet [ 157 ] On October 30, 2007, Mr Halldorson was interviewed at EPCOR’s TD Tower offices. Time sheets were provided for this day, Exhibits 11 and 12. There is a discrepancy between Exhibits 11 and 12. Both time sheets (the latter being signed by both Mr Gilewich and Mr Halldorson) total 9 hours. A one-hour block, though, differs between the two sheets. This was not explained. While Mr Halldorson was cross-examined on this point, Mr Gilewich was not. [ 158 ] What was explained by Mr Halldorson was that he was at the EPCOR TD Tower office that day. He did not go to Genesee.

His evidence was that he was able to use a visitor’s cubicle and do his work. Accessing the requisite information was, in his evidence, easy. The material was on the EPCOR network. That issue was not pursued in cross-examination. Mr Halldorson testified that because he did not go to Genesee, he did not bill for travel and he did not bill for the time of the interview. [ 159 ] Neil Cumbria had testified in his cross-examination that there was no way that Mr Halldorson could have worked on the projects indicated on the time sheets from downtown. He needed the project binders.

Mr Cumbria, though, did not address the availability of information found in project binders on the EPCOR network; that is to say information available electronically and remotely. [ 160 ] The Plaintiff did not rely on time sheet issues in its argument; in my view, for good reason. [ 161 ] If the time sheets were fabrications, that is, if Mr Halldorson could not have done any of what he claims to have done on the time sheets, that would be evidence of covering up the interview.

That, by itself, would not necessarily show that the interview amounted to “active solicitation” but if Mr Halldorson and Mr Gilewich conspired to to create false time sheets, that could support the inference that they conspired to mask the true nature of the relationship between EPCOR and Mr Halldorson. [ 162 ] However, I cannot conclude that the time sheets were fabrications. Mr Halldorson’s evidence was that he could do the work “easily” (his word) with online accessible material. Mr Cumbria opposed this point but I cannot find that the need for hard copy information was established on the evidence.

It should be borne in mind that Mr Halldorson’s current job involves work on a project in British Columbia done remotely from Edmonton. If the need for hard copy information is not established then neither is the implication of fabrication of the time sheet information. [ 163 ] The one hour block discrepancy between Exhibits 11 and 12 appears to be just that – a discrepancy. Given Mr Halldorson’s uncontradicted testimony that he did not bill for the interview time, the one hour block is irrelevant. The time description for that hour was not a mask for the interview that actually occurred.

And again, Mr Gilewich, who signed Exhibit 12, was not cross-examined on the discrepancy. [ 164 ] The time sheet evidence did not assist Cumbria. (

d) conclusion [ 165 ] I therefore find that EPCOR did not violate clause 10 in relation to the hiring of Mr Halldorson. EPCOR did not make an offer of employment to Mr Halldorson prior to his resignation from Cumbria, and EPCOR did not actively solicit Mr Halldorson prior to his resignation from Cumbria. CONCLUSIONS RESPECTING EPCOR LIABILITY [ 166 ] The claims against EPCOR are therefore dismissed. D.

PUNITIVE DAMAGES [ 167 ] Given my findings I will simply say that if I had determined only that, for example, through misinterpretation or legal error EPCOR violated clause 10, I would have had no foundation for awarding punitive damages. [ 168 ] Clause 10 sets out the damages payable by a party who breaches that clause. Since the parties agreed on the damages for the very conduct prohibited by that clause, it would not make sense to attach a further amount of damages to the same conduct.

By express agreement between the parties, compensatory damages at the amount agreed would have been sufficient to address the wrongoing of EPCOR under clause 10. [ 169 ] Punitive damages are awarded only in rare or exceptional cases in which the contractual violation involved independently actionable wrong, some form of high-handed and malicious conduct.

As described in the Plaintiff’s case of Malton v Attia , 2015 ABQB 135 at para 689 , [ 689] The purpose of awarding punitive damages against a defendant in exceptional circumstances is to punish the defendant for wrongdoing, to deter future wrongdoing, and to denounce the defendant’s conduct. Courts have described conduct deserving of punitive

damages as malicious, oppressive, high-handed, harsh, vindictive, reprehensible, and offending the court’s sense of decency; these terms describe misconduct that represents a marked departure from ordinary standards of decent behaviour. I detected no such conduct in the present circumstances, whether in connection with the hiring of Mr Pocaluyko or Mr Halldorson or in the conduct of this litigation. COSTS [ 170 ] If the parties cannot agree on costs they may approach me for a ruling in that regard within 60 days, providing brief written submissions. Delivered on the 14 th day of December, 2015.

Dated at the City of Edmonton, Alberta this 27 th day of January, 2016. W.N. Renke J.C.Q.B.A. Appearances: R. Sadownik for the Plaintiff F. Franceschi A. Walsh for the Defendants