Alberta Computers.com Inc v Thibert, 2019 ABQB 964

Court of Queen’s Bench of Alberta Citation: Alberta Computers.com Inc v Thibert, 2019 ABQB 964 Date: 20191216 Docket: 0904 01093 Registry: Grande Prairie Between: Alberta Computers.com Inc. Plaintiff - and - Troy Thibert and Snap Technologies Inc. Defendants / Plaintiffs by Counterclaim - and - Alberta Computers.com Inc. and Deegan Pope Defendants by Counterclaim _______________________________________________________ Reasons for Judgment of the Honourable Madam Justice S.L.

Hunt McDonald _______________________________________________________ [ 1 ] This dispute arises out of the end of a brief employment relationship. Alberta Computers.com Inc. (“ Alberta Computers ”) employed Troy Thibert to sell managed information technology services. Their relationship broke down, although there is a dispute as to

whether Mr. Thibert quit or was dismissed. Alberta Computers claims against Mr. Thibert and Snap Technologies Inc. (“ Snap Technologies ”) for breach of his common law or contractual duty of confidentiality, breach of fiduciary duty, and inducing breaches of contract. Mr. Thibert counterclaims against Alberta Computers and its principal, Deegan Pope, for wrongful dismissal, defamation and intentional interference with its contractual relations. I. Introduction [ 2 ] Alberta Computers, is a corporation with its head office in Grande Prairie, Alberta.

It is in the information technology (“ IT ”) industry, selling and repairing computers in a retail store, as well as providing IT managed services, the scope of which is in issue in this trial. Deegan Pope is the founder and a director of Alberta Computers. His wife, Sarah Pope, was a witness at trial. [ 3 ] At the time of the issues giving rise to this trial, Mr.

Thibert resided in Grande Prairie, Alberta, and was a principal and director of Snap Technologies, an Alberta corporation established in 2009 that provided IT managed services to businesses in the Grande Prairie area and around Alberta for a short while. He now resides in Calgary. Mr. Thibert has a two-year diploma in Business Management and E-Commerce. He worked as an insurance salesman before taking a higher paying job as a Directional Driller with an oilfield services company, and then a sales position with Alberta Computers. Mr. Thibert’s wife, Kim Thibert, was also a witness at trial.

She previously worked for Alberta Computers as Mr. Pope’s Executive Assistant, starting in June 2008 until around the time that Mr. Thibert left his employment. [ 4 ] Bryce McIntosh was an employee of Alberta Computers in 2009, providing and then performed contract work for Snap Technologies, working with Mr. Thibert until August 2010. He was originally named as a defendant and filed a Statement of Defence, but the action did not proceed against him. He was a witness at trial. [ 5 ] Mr. Thibert’s employment with Alberta Computers commenced on February 23, 2009 and ended on September 2, 2009.

The parties dispute how the employment relationship began, with Mr. Thibert arguing he was induced to leave secure employment. They dispute the terms of employment, in particular relating to Mr. Thibert’s compensation and benefits. They also dispute the nature of Mr. Thibert’s role at Alberta Computers and whether his performance was satisfactory. The extent to which Alberta Computers had developed a managed services product and business was an issue between the parties. Finally, they dispute whether Mr.

Thibert was constructively dismissed or quit. [ 6 ] Following the breakdown of the employment relationship, Mr. Thibert continued providing IT services through Snap Technologies for a short time. Alberta Computers alleges that in doing so, Mr. Thibert breached his duty of confidentiality and his contractual obligation not to use or disclose Alberta Computers’ confidential information, and that Snap Technologies and Mr. Thibert induced Mr. McIntosh and some of its customers to breach their contracts with Alberta Computers. [ 7 ] Mr. Thibert alleges that Mr.

Pope defamed him and Snap Technologies in statements made in a meeting and in letters sent to Snap Technologies’ customers and the wider Grande Prairie business community. II. Issues [ 8 ] I will consider the constructive dismissal portion of the Counterclaim first, as it is logical to start with a discussion of the employment relationship before moving to allegations of misconduct arising out of the parties’ relationship. I will then consider the claims raised in the main action, followed by the allegations of misconduct in the Counterclaim.

The issues for determination are: Counterclaim – Employment Relationship 1. What were the terms of employment? Did the parties perform their obligations? 2. Did Mr. Thibert resign, or was he expressly or constructively dismissed? 3. If he was constructively dismissed, what period of notice is he entitled to? Was he induced to leave his prior employment? What are his damages, and were they mitigated? 4. Did Alberta Computers and Mr. Pope engage in bad faith conduct? 5. If so, what are the damages? Main Action – Alleged breaches by Mr. Thibert and Snap Technologies following end of employment relationship 1.

Did Mr. Thibert improperly take Alberta Computers’ property? 2. Did Mr. Thibert breach his common law or contractual duty of confidentiality? 3. Did Mr. Thibert and Snap Technologies induce third parties to breach their contracts with Alberta Computers? 4. Was Mr. Thibert a fiduciary of Alberta Computers? If so, did he breach his fiduciary duties? 5. If there are breaches, what damages did Alberta Computers suffer as a result? Counterclaim – Alleged misconduct of Alberta Computers and Mr. Pope 1. Did Mr. Pope defame Mr. Thibert in sending a letter to the Grande Prairie community in September 2009?

2. If so, what are the damages? 3. Did Alberta Computers and Mr. Pope intentionally interfere with Mr. Thibert’s and Snap Technologies’ economic relations? III. Analysis A. Employment Relationship [ 9 ] Mr. Thibert alleges in his Counterclaim that Mr. Pope and Alberta Computers induced him to leave secure employment to work as a salesperson for Alberta Computers, and that he was constructively dismissed. At trial, he also alleged he was expressly dismissed. [ 10 ] The parties agree that Mr. Thibert worked for Alberta Computers from February 23, 2009 to early September 2009.

Otherwise, his terms of employment, including what his role was, are in dispute. There was no written employment agreement so it is necessary to look at what employment terms the parties say were agreed to. Once the circumstances leading up to employment and the terms of employment are determined, the end of the employment relationship is examined. 1. Employment Agreement (

a) Events Leading Up to Employment [ 11 ] Mr. Thibert’s evidence was that he had a series of encounters with Mr. Pope in late 2008, including meeting very briefly at a church function on Thanksgiving weekend and at the Alberta Computers retail store in December 2008. They also met up at Alberta Computers’ children’s Christmas party, and again at the adult Christmas event. In his evidence, Mr. Pope could not recall the substance of these discussions. [ 12 ] Mr. Thibert was previously employed by Cabre Oilfield Service (“ Cabre ”) in Fort St.

John, British Columbia, earning in the range of $100,000 to $120,000 per year. Cabre required employees or contractors to travel to oil and gas drilling sites in northeastern BC and northwestern Alberta to perform requested services. He managed a crew who were employed doing directional drilling. Due to the distance from Fort St. John to Grande Prairie, Mr. Thibert was only able to travel home to Grande Prairie every few weekends to see Kim and their two sons.

He was often situated for work in locations with no telephone services. [ 13 ] Alberta Computers had recently commenced a service to sell a product known as “managed services” to its clients. I accept Mr. Thibert’s evidence that Mr. Pope told him about Alberta Computers’ new managed services product when they chatted at Alberta Computer’s Christmas Party at the Keg in December 2008, which they attended because Kim Thibert was Mr. Pope’s Executive Assistant. Following their discussions at the dinner table where they were seated together, Mr. Pope told Kim that he was very interested in hiring Mr.

Thibert as a salesman for his new managed services product. Mr. Thibert did not seek out employment with Alberta Computers. [ 14 ] In January 2009, Mr. Pope requested, through Kim, that Mr. Thibert complete a Character Behavioural Questionnaire, which was suggested in the MSPU materials. Once the results were tabulated, Mr. Pope requested Kim to set up a telephone call to discuss offering Mr. Thibert employment with Alberta Computers to sell their managed services product. Kim testified that Mr. Pope told her that Mr. Thibert “was the sales guy he was looking for”. Mr. Pope and Mr.

Thibert discussed the questionnaire results in mid-January 2009 in a 30-minute conversation. [ 15 ] Mr. Thibert testified that during this conversation, he and Mr. Pope discussed terms of an offer of employment with Alberta Computers. Mr. Thibert said he told Mr. Pope that Alberta Computers could not afford him, given the salary he was currently making. Mr. Thibert indicated Mr. Pope said he could match it. Mr. Thibert’s evidence was that he would need to be making the same income as he was making in the oilfield sector, which was in the range of $100,000 to $120,000. Mr.

Thibert kept handwritten notes during one of their telephone discussions, which were exhibited at trial. Both the notes and Mr. Thibert’s evidence were that he was to earn $100,000 per annum plus benefits. He testified that to start out, they agreed he would be paid a base salary of $2,000 every two weeks on the 15th and 30th for the first three months until enough sales were made. After that time, Mr. Thibert was to be paid solely by commission on terms to be negotiated and the structure to be set out in a written employment contract.

The notes reflect a similar payment structure: -2000 (net) by weekly [ sic ] 1 st & 15 th -Benefits -Profit sharing -Bonus plan (will be up to me to get for $100,000 yr) -Van (use company van) -Km’s? get back [unclear what this means] [ 16 ] Mr. Thibert also noted on the same page: “company up & running 100% completed in Dec 08 (church). Ready for growth.” [ 17 ] At trial, Mr. Pope testified he could not recall speaking to Mr. Thibert at the firm Christmas Party at the Keg in 2008, and also disavowed any phone discussion agreeing to match Mr.

Thibert’s salary he earned from Cabre if he came to work for Alberta Computers in Grande Prairie.

[ 18 ] After these discussions, Mr. Thibert gave two weeks’ notice of his intended resignation to Cabre. His employment started on February 23, 2009 with Alberta Computers. He met with Mr. Pope at the Grande Prairie airport. They flew to Los Angeles, California to attend the Managed Services Provider University (“ MSPU ”). A training and information book called the Blue Book had been provided to Mr. Thibert in advance, discussing what managed services were and setting out suggested templates for prospects or clients interested in signing on for the service to clients and details relating to managed services.

The attendees at the MSPU were given coaching on sales and role playing. After the training session in managed services in Los Angeles, participants were told to refer to the “Blue Book” for any questions they may have relating to the managed services program and given the phone number and names of coaches to contract at MSPU to consult with to assist the attendees to get their managed services “up and running.” [ 19 ] Mr. Thibert’s evidence was detailed and supported by notes and the testimony of his wife, Kim Thibert, that Mr. Pope had said he was going to “meet and beat” what Mr. Thibert was already making.

Mr. Pope did not recall details about his pre-employment interactions and telephone conversations, or the offer made to Mr. Thibert. I accept Mr. Thibert’s evidence that he had several interactions with Mr. Pope, and that it was Mr. Pope who approached him to come and work for Alberta Computers. (

b) Alberta Computers’ Managed Services Business [ 20 ] Central in this dispute is whether Alberta Computers had developed a managed services product to sell before Mr.

Thibert commenced his employment, and whether commitments to clients who signed up for managed services could be met. [ 21 ] If a company signed on for Alberta Computers’ managed services, then the agreement provided that Alberta Computers would come into the company’s business and install Alberta Computers’ equipment such as computers, laptops and monitors, plus all necessary hardware and software, which would be integrated by Alberta Computers into a working unit for use by the company.

In addition, the agreement provided that the purchaser of the managed services would be provided with back-up services such as a HelpDesk and monitoring to ensure that the company had full-time IT support.

Alberta Computers was obligated to repair any issues with the equipment or the software set up by them. [ 22 ] The standard Alberta Computers agreement for its managed services (the “ Agreement ”) states that once the project scope is completed, Alberta Computers would configure the client’s Network and all connected Servers, Routers, Switches, PC’s, and Peripherals so that it could proactively manage and maintain the client’s network environment. [ 23 ] The core components of the Proactive Managed Services package set out in Alberta Computers’ Agreement include: (a) “All you can eat” Remote HelpDesk during business hours of 8:00 am to 5:00 pm; (b) 24x7x365 Network Critical device monitoring; (

c) Vendor management; (

d) Sales and marketing consultations; and (

e) Website development and maintenance. [ 24 ] In the Agreement, Alberta Computers promises to install the company’s Microsoft Windows Small Business Server and configure it according to Microsoft’s best practices.

When complete, it would allow the user company to designate the ability to set up remote access directly to their work stations, which would permit employees to work, check emails remotely, and allow the company to maintain its company intranet with the ability to filter content, share calendars, synchronize email on the company’s server, laptops and smartphones. [ 25 ] As well, Alberta Computers promised to implement a proactive managed services maintenance plan that would allow the purchaser company the ability to budget their IT service costs as a flat-fee each and every month, promising to save the company down costs and down time, and provide predictive proactive problem resolution through their Alberta Computers “All you can eat HelpDesk.” [ 26 ] On his cross-examination, Mr.

Pope indicated he wanted to hire someone to sell his services, and agreed that he could not sell something that was not available or that he did not have access to. Amendment of the Statement of Claim at Trial [ 27 ] In its Amended Statement of Claim, Alberta Computers alleged in para 5: Over the past 11 years, the Plaintiff, through the time, skill, effort, expertise and expenditure of capital of its founder, [Mr.

Pope], has developed a unique and distinctive system relating to the delivery of IT managed services to businesses which includes, inter-alia , techniques, training methods, technical support and methods of delivery of IT managed services (the “Services”). Further, the Plaintiff, through the time, effort and expenditure of capital of its founder, Mr.

Pope, has developed a client contact list (the “Contact List”) for the purposes of targeting likely businesses that would benefit from the implementation of the Plaintiff’s Services. [ 28 ] At trial, Alberta Computers was granted leave to further amend its Amended Statement of Claim to remove part of the above claim that this system was a “unique and distinctive system relating to the delivery of IT managed services which includes techniques, training methods, technical support, and methods of delivery of IT managed services”.

The plaintiff requested this amendment on the basis that it would materially shorten the length of the trial. This was an integral part of the action until trial, and the defendants vociferously objected unless conditions were permitted. I allowed the amendment “on the understanding that [defendants’ counsel] may explore anything he wishes that was worded in the previous pleadings, given the extent and length of time that they have been part of the pleadings and this last-minute amendment.”

[ 29 ] Thus, although Alberta Computers no longer alleged it had a unique and distinctive system for delivering IT managed services, Mr. Thibert was permitted to explore what was promised leading up to, and during, his employment. In addition, Mr. Thibert was permitted to explore the allegation in the Counterclaim that Alberta Computers was over-promising and under-delivering IT services, which undercut his “ability to effectively sell and maintain positive sales relationships”. What the Managed Services Product actually was [ 30 ] Mr.

Pope could not define when Alberta Computers began offering managed services. [ 31 ] Mr. Thibert testified that he anticipated the managed services product would include upgrading the equipment and IT connectivity in the organization, if required, to bring the computing environment up to minimum standards. He found that some equipment installed by Alberta Computers’ technicians at one managed services client’s premises was used equipment. Mr. Thibert also anticipated a HelpDesk would be set up at Alberta Computers, but instead, he was asked to set up an outsourced HelpDesk vendor.

He later received complaints from clients about the service. Finally, Mr. Thibert testified that one of the main components when providing a high-level IT managed maintenance service that is proactive is to have a monitoring tool that reports back to a main dashboard. It would also permit Alberta Computers to print out “health reports” as to the health of clients’ computers. Mr. Thibert testified that the required monitoring was not being provided to clients. [ 32 ] Mr. McIntosh began his employment with Alberta Computers in February 2009.

He understood its business at that time to mainly be inside service (where people bring their computers in for repair), retail, and some outside service (where clients would call up for repairs or set up services on-site). He was hired to be the outside technologist. He did not recall any discussion of managed services initially, but began hearing about them from Mr. Thibert, as they commenced employment with Alberta Computers on the same date. At trial, he stated: “I heard that they wanted to get into managed service [ sic ], and that we were going to start going that way.” [ 33 ] Mr.

Lester testified he worked for Alberta Computers in the retail store from September 2008 to July 2011. He adopted his evidence from questioning that in the six months between when he was hired and Mr. Thibert began working for Alberta Computers, he did not work for any managed services clients. [ 34 ] Mr. McIntosh testified that he left his employment with Alberta Computers because he was unhappy with a few incidents. The final incident was when he was assigned a job pulling cable through dusty ceilings, which caused his asthma to act up.

He was assigned the job even though he had previously advised of his health concerns, and he resigned a few days into the job. [ 35 ] In his Statement of Defence filed in this action, he commented that he left due to Alberta Computers’ “consistent unethical business practices”. At trial, he explained: That was the [ sic ] trying and actually selling managed services that were non-existent, and also the selling, in one case, of a back-up unit that was utilizing beta software that the client, when I talked to them was unaware of. They believed it was a completed product. [ 36 ] On cross-examination, Mr.

McIntosh confirmed that he was not really familiar with whether customers had, or did not have, certain options under managed services. [ 37 ] According to Mark Nagel, an IT technical service provider who subsequently started a business with Mr. Thibert, managed services include proactive management and remote monitoring. That is in contrast to providing IT support to businesses that is more reactive. He and Mr. Thibert started a business, IT Partners, which provided managed services later in 2010.

To his knowledge, their only competitor in the Grande Prairie area providing similar services was PCIT from 2010 to when he testified at trial. He described Alberta Computers’ business as “break-fix consumer-based IT”, although he admitted on cross-examination that he could not say what services Alberta Computers has provided to its clients. [ 38 ] Alberta Computers originally pleaded that it had a “unique and distinctive system relating to the delivery of IT managed services which includes techniques, training methods, technical support, and methods of delivery of IT managed services”.

As noted above, Alberta Computers was permitted to amend its pleading at trial to remove this allegation. Alberta Computers did not establish that it had a unique IT managed product, as was represented to Mr. Thibert. This is significant in respect of Mr. Thibert’s performance during his employment. (

c) Employment Terms [ 39 ] The parties do not dispute that Mr. Thibert was employed by Alberta Computers beginning on February 23, 2009. They dispute the terms of employment for Mr. Thibert. There was no written employment agreement entered into. It is clear there was an oral agreement and that the parties were beyond the negotiation stage, other than to agree on the commission that remained to be finalized.

As stated in Schluessel v Margiotta , 2018 ABQB 615 [ Schluessel ] at para 49 , “...the absence of signed documents, where the documents represent only a formalization of already settled terms, does not preclude a finding that a binding agreement exists” [citation omitted]. The issue is what those terms were. [ 40 ] In circumstances like this, where the parties’ versions of their agreement cannot be reconciled, the court will consider the parties’ actions to determine their intentions: Schluessel at para 14 , citing Pleasant Hill Plaza Inc v Sheppard , 2005 SKQB 57 at para 28 .

Further: In applying the objective, reasonable person test, courts will consider parties’ conduct before, during, and after a disputed agreement. Where there is disagreement on the facts of how parties’ [sic] conducted themselves “the court must decide which version of events is the most reliable,” that is, which version is “in harmony with the preponderance of the probabilities which a practical and informed person would readily recognize as reasonable” ( Own para 21). This may entail a credibility assessment: Schluessel at para 14 , citing Own v Wong , 2017 ABQB 35 at paras 19 , 21.

[ 41 ] Mr. Thibert testified that he and Mr. Pope had various discussions regarding terms of a job offer, both in person and on the telephone, and that Mr. Pope consistently made assurances that he had a mature and operational managed services product for Mr. Thibert to sell. Mr. Thibert testified that the terms of his employment were discussed during a telephone conversation with Mr. Pope that lasted approximately a half hour, as well as other conversations. Mr. Thibert’s notes from the half hour call were made exhibits at trial and are described above. [ 42 ] Mr. Thibert’s evidence was that he accepted a job offer from Alberta Computers on the following terms: (

a) Alberta Computers had a unique, fully operational managed services product ready for Mr. Thibert to sell, and he would be employed as a salesperson; (

b) Mr. Thibert would earn at least $100,000 per year, made up of base salary and commission, with the commission structure to be provided. There would also be a profit sharing and bonus plan, and it would be up to him to earn more than $100,000 per year; (

c) Mr. Thibert would receive employment benefits; (

d) Mr. Thibert would receive use of a company van; and (

e) Mr. Thibert’s employment would commence upon the date of his attendance at the MSPU conference in Los Angeles, California, on February 23, 2009. [ 43 ] Mr. Thibert testified that he was supposed to receive a written employment agreement as a salesperson. [ 44 ] On cross-examination, Mr. Pope agreed he was in search mode to fill a dedicated salesperson position for Alberta Computers’ managed services business. He testified that he believed Mr. Thibert first contacted him by telephone about the job, but he did not remember the phone call at all. Mr. Pope did not remember meeting Mr. Thibert in person before Mr.

Thibert came to work at Alberta Computers. Mr. Pope did not design a job profile or job description for this position, but intended to use the one MSPU had in their reference materials (which was not filed as an exhibit at trial). [ 45 ] Mr. Pope testified that MSPU set out a commission structure in its agreement. He asked Mr. Thibert how much money he needed to earn in order to make ends meet. According to Mr. Pope, Mr. Thibert needed to earn $4,000 per month (net). Mr. Pope indicated this worked out to around $5,600 per month (gross). Mr. Pope testified that Mr.

Thibert’s compensation was to be strictly commission-based after three months of employment. Alberta Computers would also pay 50 percent of any Blue Cross health plan coverage selected by Mr. Thibert, as well as use of the company van (although that was not intentional) that Kim Thibert was already driving. [ 46 ] Mr. Pope testified about his understanding that Mr. Thibert needed $4,000 per month to make ends meet. After three months, Mr. Pope testified that Mr. Thibert was not tracking enough sales to make ends meet.

If the original planned commission structure he had been thinking of using was implemented after three months, Mr. Pope said Mr. Thibert would be making something like $200 per month. Instead, Mr. Pope testified that Alberta Computers continued to pay Mr. Thibert a gross base salary of $5,600 per month and looked for an alternate commission structure. Mr. Pope looked at the commission structure offered by another managed services provider in California, AARC Technologies, who he met at MSPU. He determined that the AARC commission structure was the same as the one from MSPU, and that Mr.

Thibert would not be making enough money to pay his bills using that structure. As a result, Alberta Computers just kept paying out the base salary until Mr. Thibert’s employment ended. [ 47 ] From Mr. Thibert’s testimony, it is clear that Mr. Pope, on behalf of Alberta Computers, never sat down and discussed the commission structure issue with Mr. Thibert when Mr. Thibert raised the issue with him. Instead, Mr. Pope would say that Mr. Thibert was not selling enough even if he was not being paid on a commission basis to earn sufficient compensation to exceed his present pay arrangement.

It is difficult to assess whether earnings under a commission-based structure would have provided sufficient income, as the particulars of the structure were not provided to Mr. Thibert or agreed upon. [ 48 ] Mr. Thibert mentioned that every time that he said he would like to sit down with Mr. Pope to finalize the employment agreement and commission structure, Mr. Pope would put him off. Mr. Pope did not recall Mr. Thibert asking about the commission structure until July 2009, when Mr. Pope also asked Mr. Thibert to sign a non-disclosure agreement. [ 49 ] Mr. Thibert recalled that Mr.

Pope provided him with a nine-page draft non-disclosure agreement dated July 23, 2009 (the “ NDA ”). It contained terms relating to confidentiality, non-competition for two years with no geographic limit, non-solicitation for three years, and non-disclosure. Mr. Pope testified that Mr. Thibert refused to sign it. As a result, it does not impose contractual obligations on Mr. Thibert (although there may be common law obligations, as will be discussed). [ 50 ] In general, I prefer Mr. Thibert’s evidence to that of Mr. Pope regarding Mr. Thibert’s terms of employment.

His recollection is supported by contemporaneous notes in respect of the key terms, and Kim Thibert confirmed that he had several encounters and conversations with Mr. Pope before his employment commenced. Mr. Pope’s recollection was vague about his conversations with Mr. Thibert, although he did corroborate Mr. Thibert’s assertion that a commission structure was required but not yet provided. It would not make sense for Mr.

Thibert to leave his secure employment without an employment offer with the terms and assurances he says were given. [ 51 ] Based on the evidence before me, including the parties’ conduct during Mr. Thibert’s employment, I conclude that Mr. Thibert’s terms of employment are as follows: (

a) Mr. Thibert would be employed as a salesperson selling Alberta Computers’ unique, fully operational managed services product; (

b) Mr. Thibert would earn at least $100,000 per year, made up of base salary and commission, with the commission structure to be provided. Until the commission structure was agreed, Mr. Thibert would be paid a salary of approximately $5,600 per month to net

approximately $4,000 per month, the amount Mr. Pope understood he needed to make ends meet. Indeed, Mr. Thibert’s pay stubs provided at trial establish that he was paid $5,200 bi-weekly during most of his time at Alberta Computers; (

c) There would also be a profit sharing and bonus plan, with details to be provided, and it would be up to him to earn more than $100,000 per year; (

d) Mr. Thibert would receive employment benefits; (

e) Mr. Thibert would receive use of a company van; and (

f) Mr. Thibert’s employment would commence upon the date of his attendance at the MSPU conference in Los Angeles, California, on February 23, 2009. (

d) Performance of Obligations Training [ 52 ] The day his employment began, Mr. Pope and Mr. Thibert attended an MSPU conference in California. Mr. Pope described it as a training conference, but Mr. Thibert said virtually no training occurred at this conference. Mr. Thibert testified that the conference was primarily for vendors to pitch their products and services for IT firms to include in their managed services products. Mr. Thibert requested further training, but his request was denied, except for Mr. Pope’s suggestion that Mr.

Thibert contact MSPU to request support for role playing of his sales pitch by teleconference with a trainer assigned to Alberta Computers by MSPU. On-going Sales Support [ 53 ] Once Mr. Thibert commenced employment with Alberta Computers, Mr. Pope paid for a Dun and Bradstreet listing of companies located in the Grande Prairie area, of which a review might indicate if there was a significant enough base of operations for Alberta Computers to conclude that the company might be interested in signing on for managed services to be supplied by Alberta Computers for a negotiated monthly fee. Mr.

Pope reviewed the list for parties that he then suggested Mr. Thibert should contact. Mr. Thibert also researched the list to determine possible prospects. [ 54 ] Mr. Pope also had a point of sale list of Alberta Computers’ current clients who had purchased equipment or services in the retail store. [ 55 ] In addition, he hired the previous CEO of the Chamber of Commerce of Grande Prairie, Lionel Frey, to suggest possible leads that Mr. Thibert could contact to generate interest in signing up for Alberta Computer’s new managed services product. At the time, Mr. Frey had a marketing company.

One service he offered was generating leads for his clients, using his network of contacts. [ 56 ] Mr. Frey testified that he started working with Alberta Computers in around the third week of March 2009, primarily meeting with Mr. Thibert. Mr. Frey’s services finished by mid- to late May 2009. He and Mr. Thibert had a series of weekly meetings, primarily to discuss leads he suggested based on his numerous business contacts, as well as discussing a marketing sales strategy. Mr.

Frey prepared a one-page flyer for Alberta Computers that explained that the idea behind the managed services product was to give companies the benefit of having an IT department of their own for payment of a monthly fee. [ 57 ] Mr. Frey testified that after approximately two months of contact, he moved on to other opportunities, as he was not being paid according to the billing terms that he and Mr. Pope had agreed upon when he was retained to provide services to Alberta Computers. He testified he was eventually paid by Alberta Computers. [ 58 ] Mr.

Thibert testified at the beginning of his employment with Alberta Computers, he was given duties in addition to marketing the managed services product. Mr. Pope noted in a written Performance Appraisal dated June 19, 2009 that Mr. Thibert’s primary job duties were marketing, prospecting, selling managed services, managing corporate accounts, and closing accounts. Mr. Thibert testified that he spent the first few months going through Bell Mobility to update the services Alberta Computer could provide. He updated Alberta Computers’ website, as well as worked with Mr.

Pope to determine leads from the Dun and Bradstreet list of contacts to whom to market the managed services product. He also had numerous meetings with Lionel Frey to discuss suggested leads for the purpose of marketing the managed services product. Clients [ 59 ] Mr. Pope told Mr. Thibert before he was even hired that a managed services contract with the Christian Fellowship Assembly was up and running and fully operational. In his early employment, both Mr. Thibert and Mr.

McIntosh responded to a request for services at the Christian Fellowship Assembly’s premises to assist in getting their system properly up and running. Even after their attendance for repairs and adjustments, however, there was no critical device monitoring system provided by Alberta Computers, nor the promised HelpDesk. Mr. McIntosh testified that he would go on service calls to the Christian Fellowship Assembly, but he was not involved in installing any monitoring tools and “[t]here was no monitoring in place”. [ 60 ] Mr. Thibert signed three companies up for the managed services of Alberta Computers, namely, (

a) Best Truck Services & Automotive Ltd. (“ Best Truck ”); (

b) Pride H2S Safety and Medical Services (“ Pride ”); and (

c) Northern Athletic Wear and Advertising Limited (“ NAW ”). Mr. Thibert’s job title in the Agreements was “Business Solutions Advisor”. [ 61 ] The first contract negotiated by Mr. Thibert was with Frank Behnke of Best Truck. The contract was signed on May 20, 2009 for $1,550.00 per month, plus an additional set up fee, for a term of three years. Mr. McIntosh testified that the server Alberta Computers installed was not adequate for the task required. Further, Mr. Thibert noted that monitoring was not being provided. He stated: “So, it’s

an outsource. It’s a very big component and that was 100 percent missing inside that service contract”. [ 62 ] Pride signed a three-year contract on August 14, 2009 with Alberta Computers payable at $2,231.27 per month, plus an additional set up fee. The Server for Pride never arrived, nor was the 24x7x365 Network and Critical Monitoring ever provided. [ 63 ] NAW signed a three-year contract, also on August 14, 2009, payable at $1,382.93 per month, plus an additional set up fee. The equipment installed by Alberta Computers did not have the software program required by the company to run their business.

Debbie Grenier-Nichol of the company testified at trial that they received a laptop that did not have the software program they required. She testified that even after Alberta Computers came out to upgrade the laptop, it was not successful in repairing the problem. NAW also complained that they were mostly provided with refurbished equipment. Ms. Grenier-Nichol and her husband, Brett Nichol, demanded a refund from Alberta Computers in writing for the managed services that they had signed on for. Eventually, after Mr.

Thibert’s departure from Alberta Computers, they negotiated an end to the agreement directly with Mr. Pope. [ 64 ] When the relationship between Mr. Pope and Mr. Thibert fell apart, Mr. Thibert testified he was in the process of negotiating a contract with Randy Galbreath of Stratus Pipelines Ltd. (“ Stratus ”). Mr. Pope placed great pressure on Mr. Thibert to have the agreement signed. Mr. Thibert testified that Mr. Galbreath rejected the Agreement. [ 65 ] Mr.

Thibert testified that the lack of provision of the 24x7x365 Monitoring Services and the Remote HelpDesk were key products that anybody purchasing managed services would rely upon to obtain the IT assistance that they contracted for. Mr. Pope stated the managed services product was a completed product for marketing purposes; however, I find that it was not up and running and available to provide to clients the services that were promised in their Agreements. [ 66 ] Mr.

Thibert was never advised that it was Alberta Computers’ intention to install refurbished computer equipment to fulfill their obligations for the managed services installed systems. [ 67 ] It turned out that the initial parties that signed on for the managed services program with Mr. Thibert were not satisfied, as Alberta Computers in almost every instance installed mostly old, but refurbished, equipment in their premises, with very little new equipment being provided.

Further, for some of the contracts negotiated, equipment needed to be ordered by Alberta Computers and was very slow in being provided and installed. [ 68 ] When Mr. Pope testified on behalf of Alberta Computers, he stated that the quality of refurbished equipment, once re- certified, was better than cost-efficient new equipment. However, I am not satisfied that he ever explained that fact to Mr. Thibert, who assumed new equipment would be installed in the new managed services’ client’s premises. [ 69 ] Despite Mr.

Thibert marketing the managed services product with a provision in the Agreement that a HelpDesk would be provided to Alberta Computers’ clients, Mr. Pope on behalf of Alberta Computers decided to outsource the IT HelpDesk. Mr. Thibert initially had no knowledge, nor was he informed by Mr. Pope, of the arrangement he was considering to meet the obligation promised in the Agreement. Later, in July 2009, he was requested by Mr.

Pope to get in touch with a specified vendor to arrange for HelpDesk services to be supplied to the managed services clients to meet the terms set out in the clients’ agreements with Alberta Computers. [ 70 ] The other critical deficiency was that the promised 24x7x365 Network and Critical Device monitoring was never provided to the clients who had signed on for the managed services product. [ 71 ] The failure to set up monitors to assess probable issues that might arise with the hardware supplied by Alberta Computers was a glaring deficiency.

The idea behind the monitored services was to allow early warning if there were issues with the setup at the clients’ premises which could give Alberta Computers notice that services were required to keep the system operational. Mr. Thibert’s Performance [ 72 ] Mr. Thibert’s employment tasks were not what he expected. He thought he would have support and training, both internally and externally, as well as some established clients. Instead, his evidence was that Mr. Pope disengaged from any activity related to the managed services business almost immediately after he was hired, notwithstanding that Mr.

Thibert agreed to attend weekly goal meetings with Mr. Pope at Mr. Pope’s specific request. Mr. Pope’s focus seemed to be on an IT security business called Cornerstone Backup. Mr. Thibert stated he did not receive much further training due to the fact that training available to him through MSPU was aimed at role playing his pitch to possible customers; what he needed was a completed product to sell. Mr.

Thibert said he only learned in the period from February to May that Alberta Computers did not have any established and unique managed services product or infrastructure. [ 73 ] Further, after his hiring, he subsequently learned the promised account with Christian Fellowship Assembly was not a managed services account, as no monitoring had been installed and there was no HelpDesk available. Kim Thibert testified that Sarah Pope had asked her to “zero out” their invoices monthly as they had an agreement, but it was not clear what was included in those invoices.

I find Alberta Computers did not have an existing managed services client when Mr. Thibert commenced his employment, as represented by Mr. Pope. [ 74 ] Most notably, Mr. Thibert was given few sales resources. The only resources included access to MSPU materials and contact with their personnel to practise his sales pitch, a Dun & Bradstreet list purchased during his employment that was pared down by Mr. Pope, and access to Mr. Frey. Mr. Pope testified that MSPU also provided coaching in relation to the sales process, including funnelling prospects to leads, and then to appointments, and finally to sales.

Sarah Pope also met regularly with Mr. Thibert to talk about the sales process. [ 75 ] At Mr. Pope’s request, Mr. Thibert organized a business breakfast in May 2009 to which clients or possible clients for the managed services product were invited, but Mr. Thibert did not feel ready to make the presentation. As a result, Mr. Pope attended and made the presentation on Alberta Computers’ managed services product. Mr. Pope complained that he should not have had to do the

presentation, as that was the role of the salesperson. [ 76 ] Although support for Mr. Thibert was minimal, particularly in being able to deliver the managed services product he was selling, he set up individual client luncheons and secured managed services contracts with Best Truck, Pride and NAW. [ 77 ] A Performance Appraisal Review with Mr. Pope for Mr. Thibert was completed in a meeting on June 19, 2009 that was designated an “end of probation” review.

It included ratings on employee performance factors including job knowledge, dependability, quality, problem solving and initiative, communication, teamwork, and productivity and effectiveness. For all categories, Mr. Thibert received a rating of either “exceptional performance” or “above average performance”, and his overall rating was “above average performance”. It was a very positive review, and included goal-setting for the following six months. Mr. Thibert’s job title in this review was “Outside Sales”. [ 78 ] Although Mr. Thibert had a very positive employment review on June 19, a meeting with Mr.

Pope six days later on June 25, 2009 was negative. Mr. Pope expressed his disappointment about not enough contracts being signed, notwithstanding the positive review he had given to Mr. Thibert days earlier. [ 79 ] Mr. Pope testified that Mr. Thibert engaged in misconduct, which was in contrast to the Performance Appraisal Review of June 19, 2009. His evidence was that Mr. Thibert was given two written warnings threatening dismissal. The first Employee Warning Notice, dated June 25, 2009, stated that Mr. Thibert walked out of a meeting “out of [a]nger” on June 24, 2009.

The consequences of further infractions was noted in the first Employee Warning Notice: “Disrespecting Management by walking away from conversation and breaking off all communication will result in immediate dismissal.” The second Employee Warning Notice, dated July 22, 2009, was because Mr. Thibert allegedly questioned Mr. Pope’s ethics after Mr. Pope was told by another employee, Chris Lester, that Mr. Thibert “[t]old other employees [that Mr.

Pope] had “pulled a bait and switch” on him, and did not fulfill promises made.” Again, the consequences for further infractions was stated in the second Employee Warning Notice to be immediate dismissal. [ 80 ] Mr. Thibert’s evidence was that he did not meet with Mr. Pope about either of these incidents, nor did he receive the written warnings dated June 25 and July 22, 2009 from Mr. Pope. He testified that the first time he saw the written warnings was when Alberta Computers produced the documents for trial. [ 81 ] Mr. Thibert recalled meeting with Mr. Pope on June 24, 2009, where they discussed Mr.

Thibert’s concerns about competition among providers of managed services entering the Grande Prairie market, his request to establish his commission, and the lack of monitoring at the Christian Fellowship Assembly. He said he left the room normally once the meeting finished. [ 82 ] Mr. Thibert also denied engaging in the conduct set out in the second Employee Warning Notice. His recollection was that Mr. Pope provided him with a draft NDA dated July 23, 2009, one day after the date of the second Employee Warning Notice.

In addition to terms relating to confidentiality, non-competition, non-solicitation and non-disclosure, Mr. Thibert testified that the version of the NDA put before him in July 2009 contained an onerous clause for termination of his employment that favoured Alberta Computers. This clause was not in the NDA exhibited at trial. In any event, the NDA was not agreed to by the parties. [ 83 ] Mr. Thibert noted that Mr. Pope was in the office less frequently in July and August 2009, and was rejecting meeting requests from him. He said Mr.

Pope’s calendar was completely booked with his IT security business, Cornerstone Backup, and another new business, SNAP Securities, and he was not available to discuss Alberta Computers’ managed services business with Mr. Thibert during this time. Mr. Thibert testified that Mr. Pope’s availability became less and less, and once the summer began, his overtures to Mr. Pope were met with “complete evasiveness”. [ 84 ] During his approximate 6.5-month employment term, Mr. Thibert frequently expressed concerns to Mr.

Pope that Alberta Computers did not have, and was not developing, the appropriate resources to support the managed services Agreements. As well, he continued to ask Mr. Pope to clarify his commission structure and provide him with a written employment agreement. These were never provided. The only agreement proffered by Mr. Pope was the NDA in July, which contained non-disclosure, non-competition and non- solicitation terms. Mr. Thibert refused to sign it. [ 85 ] Mr. Thibert tried to address the shortcomings he identified in delivering the managed services product to Alberta Computers’ clients.

For example, on July 23, 2009, he sent an email to Sarah Pope, copied to Mr. McIntosh, Kim Thibert, Mr. Pope and Mr. Lester, regarding completion of the Agreement with Best Truck, where he wrote, in part: Perhaps it may be beneficial that I be given the role to see projects through from sale to implementation, as I have complete knowledge of what each client is in need of...? Bryce an [ sic ] I work well together and could make this happen – no problem. As soon as we have @ 10-12 deployments behind us I can pass this role off, as I will be up and running with regular meetings....

Just a thought, as it seems that we are stumbling. [ 86 ] His suggestion was not implemented. Instead, Mr. Pope took the position, even at trial, that the problem was with Mr. Thibert’s performance and inability to sell. [ 87 ] The difficulties faced by Mr. Thibert and Alberta Computers in growing the managed services business did not arise because Mr. Thibert needed to improve his pitch, or even that more leads were needed. The problem was that Mr. Thibert did not have a fully developed managed services product to sell. Mr.

Pope had represented to him that Alberta Computers had a unique and distinctive managed services system to sell to customers, but he could not deliver on that representation. There was no evidence of such a system, and in fact, Alberta Computers withdrew its assertion in its pleading that there was such a system. 2. Resignation, Express Dismissal or Constructive Dismissal [ 88 ] The parties agree that Mr. Thibert’s employment ended on September 2, 2009. They disagree as to whether he resigned, was expressly dismissed, or was constructively dismissed.

[ 89 ] On September 1, 2009, Kim Thibert sent an email to Sarah Pope, who supervised the accounting and administrative staff, resigning as Mr. Pope’s executive assistant. She testified she could not continue in her role, given the tension that had developed in the relationship between Mr. Pope and her husband. Her email was read into the record at trial several times. In it, she expressed that “it has been extremely difficult for me to be Deegan’s assistant and a wife to Troy at the same time”. She also indicated that she was “so very grateful” to Sarah and Mr.

Pope, and appreciated that they hired her without skill and taught her “so many things”. [ 90 ] Sarah and Mr. Pope did not want Kim to leave. Mr. Pope requested Mr. Thibert and Kim to attend a meeting on September 2, 2009 to request that Kim reconsider her resignation and to discuss tensions between Mr. Thibert, on one hand, and Mr. Pope and Mr. Lester, on the other. Sarah was also in attendance. Sarah testified that the purpose of the meeting was to try to persuade Kim not to leave her employment. There was a dispute between the evidence of the Thiberts and the evidence of the Popes as to whether Mr.

Thibert was at the meeting at the beginning, or if Kim had to return to their home to pick him up. I accept Kim’s evidence that she and Mr. Thibert drove to work together in the morning before the meeting started. [ 91 ] Kim testified that Mr. Thibert wanted to take control of the managed services product because he felt he could really get it going for Alberta Computers. At some point, the meeting degenerated. Kim and Mr. Thibert indicated that Mr. Pope told Mr. Thibert, in Kim’s words, that he could not “sell poop, but used the other word”, and that he had been trying to fire Mr. Thibert for two months. Mr.

Pope denied saying these things. Sarah denied that Mr. Pope said that he could not sell [poop], although she recalled in questioning that Mr. Pope said Mr. Thibert was not selling. She could not recall if Mr. Pope said he had been trying to fire Mr. Thibert for two months. Mr. Lester also could not recall Mr. Pope saying he had been trying to fire Mr. Thibert for two months, although he recalled in his questioning that Mr. Pope expressed that Mr. Thibert was not doing his job because he was not selling anything. In a letter from counsel for Alberta Computers directed to Mr. Thibert, Mr.

McIntosh, and PCIT, a company for whom Mr. Thibert worked briefly after leaving Alberta Computers, it states: “In July of 2009, it became clear to our client that the employment relationship, for a number of reasons, was not working out...” This supports the assertion that Mr. Pope said he had been trying to fire Mr. Thibert for two months. I accept that Mr. Pope made the statements as reported by Mr. Thibert and Kim. [ 92 ] Mr. Pope testified that Mr. Thibert left the meeting in anger, yelling “I quit”. He went upstairs in the building, and, according to Mr. Pope, “grabbed a bunch of our stuff”, and then left.

Mr. Lester testified that “quite abruptly the meeting ended when Troy just stood up and said he quit, and walked out of the meeting room”. Mr. Lester said that Sarah asked him to go and make sure Mr. Thibert did not leave the office with any of Alberta Computers’ property. He saw Mr. Thibert leaving with materials from his office under his arm, and Mr. Thibert purposely pushed him with his shoulder as they passed in the hallway. Sarah recalled that Mr. Thibert and Mr. Pope were arguing at the end of the meeting, and then Mr.

Thibert said he quit, and walked out of the meeting. [ 93 ] Not surprisingly, the Thiberts recall the end of the meeting differently than the Popes and Mr. Lester. Mr. Thibert testified that after Mr. Pope said he could not sell and that he had been trying to fire him for two months: I reacted, I got up and my hands were like this. I went, I guess I’m done here? And I asked Deegan, “Am I done?” and he said, “Yes.” And then I said, “Do you need two weeks?” and he said, “No.” [ 94 ] Mr. Thibert testified he then went to his office to collect his personal items, and he bumped into Mr.

Lester in the hallway on the way out. He waited in the van for Kim to finish in the meeting, and they drove home together. In cross-examination, he was asked about a police statement dated October 30, 2009 arising out of an allegation made by Mr. Pope that he stole a laptop, which is discussed further in the

section below on Alleged Breaches by Mr. Thibert and Snap Technologies. In his statement, he explained that he left Alberta Computers after a meeting on September 2, 2009. He wrote: “Deegan had told me exactly “I have been trying to fire you for 2 months.” I immediately resigned from my position.” At trial, he said this statement was inaccurate. In his Application for Employment Insurance Benefits, Mr. Thibert indicated that he quit his job because of personal conflict.

He also indicated that he was laid off from Cabre, but then explained that his boss at Cabre laid him off, rather than having a complete break in the employment relationship in case Mr. Thibert changed his mind about leaving. [ 95 ] Kim’s evidence was similar to Mr. Thibert’s. After Mr. Pope made the statements I have found above were made, Kim testified: “Troy got up and raised his hands and was like, Okay, I guess I’m done here. Do you want my two weeks [ sic ] notice? And Deegan said, No.” Then, Mr. Thibert left, and Kim stayed for another 10 to 15 minutes, before driving home with Mr.

Thibert. [ 96 ] The following sequence of events led up to the September 2, 2009 meeting: (

a) Mr. Thibert continued to ask about his employment agreement and finalizing the commission structure. Kim testified that they were losing money monthly so it was a financial struggle; (

b) Mr. Thibert was concerned, and had expressed his concerns, that Alberta Computers did not have the ability to service the managed services clients as promised. Significantly, there was no monitoring; (

c) Mr. Thibert worked hard to try to deliver on what had been agreed, but felt he was “in limbo” when Mr. Pope shifted his focus in the summer of 2009, leaving Mr. Thibert without his input and support on the managed services business. Mr. Pope had been engaged initially, conducting the May 2009 presentation and doing a performance appraisal in June 2009, but was disengaged by the summer of 2009; (

d) On July 23, 2009, Mr. Pope presented a nine-page NDA to Mr. Thibert to sign that contained broad non-solicitation, confidentiality and non-competition clauses. Mr. Thibert recalled it also contained a clause on termination, although the NDA filed at trial did not contain this clause; (

e) Mr. Pope had prepared two Employee Warning Notices in June and July 2009 that Mr. Thibert denied seeing, but that, at a minimum, demonstrate growing tension between Mr. Pope and Mr. Thibert, regardless of whether the incidents happened as reported or if Mr. Pope was just creating a paper record of perceived issues. Indeed, Kim testified that the office environment was becoming more and more tense, and that the tension between Mr. Pope and Mr. Thibert was evident, ultimately leading to her resignation on September 1, 2009;

(

f) Starting in July 2009, Mr. Pope required Mr. Thibert to account for his time in 15-minute increments; and, (

g) Beginning in August 2009, there was an on-going issue about whether Kim could purchase the company van she had been driving that was agreed to in writing by Mr. Pope in July 2009. [ 97 ] I conclude there had been building tension between Mr. Thibert and Mr. Pope for several months. Mr. Pope was upset that Mr. Thibert was not selling the managed services product, and Mr. Thibert was concerned that Alberta Computers could not deliver on the managed services promised in the Agreements.

He also was concerned that he did not have a written employment agreement or commission structure, despite following up throughout his employment. At the time of the meeting, Mr. Thibert had signed up three customers for managed services but still did not know what commission he was entitled to. I find there was a confrontation on September 2, 2009, even if the meeting did not start out with that intention. [ 98 ] Mr. Thibert asserts he was dismissed, either expressly at the September 2, 2009 meeting or constructively dismissed as a result of events leading up to, and including, the September 2, 2009 meeting.

Alberta Computers and Mr. Pope say that Mr. Thibert quit his employment on September 2, 2009. Also, they argue that Mr. Thibert did not properly plead express dismissal in the Counterclaim. [ 99 ] Alberta Computers alleges that, after his employment ended, Mr. Thibert wrongly took two of Alberta Computer’ laptops, a cell phone, a van, customer lists, and three original signed Alberta Computer contracts. These allegations are discussed below in the

section on “Alleged Breaches by Mr. Thibert and Snap Technologies”. Express Dismissal [ 100 ] Mr. Thibert alleges he was expressly dismissed by Mr. Pope through his words and conduct at the September 2, 2009 meeting. [ 101 ] Mr. Pope argues that express dismissal was not plead by Mr. Thibert in his Counterclaim. In any event, he says Mr. Thibert quit. The purpose of the meeting was to resolve the tension and frustration in the office, and not to terminate Mr. Thibert. A termination would not have required a meeting with Sarah, Kim and Mr.

Lester to all be present. [ 102 ] The first issue for determination is whether express dismissal was sufficiently plead, and if not, whether that precludes Mr. Thibert from advancing that argument. Mr. Thibert argues that the material facts relating to express dismissal have been plead, and that suffices for him to advance that claim. He relies on this court’s decision in Chief Construction Company Ltd v Royal Bank of Canada , 2017 ABQB 589 at paras 41-42 , where the court held: 41 All the facts upon which I granted

summary judgment for $3,245.00 and sent the other claims to trial are contained in the amended statement of claim. The fact that Chief Construction has put the wrong label (i.e. breach of contract) on its claim, rather than asserting a right to redistribution of sale proceeds, does not result in the claim being void. Provided that all material facts are pleaded, the fact that a pleading may mislabel the nature of the claim is not fatal. 42 As stated in MDI Industrial Sales Ltd. v. McLean , 2000 ABQB 521 , 267 A.R. 394 (Alta.

Q.B.) at para 7 : A pleading need only plead the facts which in law would create a certain cause of action. It need not name the cause of action, or name any cause of action, or give a legal conclusion, and may name a different cause of action, or the wrong cause of action : (emphasis added). [ 103 ] This court must balance the above principle with the well-established rule that a judge “should not decide a case on a matter not pleaded, and specifically should not grant remedies beyond the pleadings”: Mazepa v Embree , 2014 ABCA 438 at para 8 .

This is tempered by the court’s ability to amend the pleadings at any time, pursuant to rule 3.65 of the Alberta Rules of Court , A Reg 124/2010: at para 9. [ 104 ] The Counterclaim describes Mr. Thibert’s terms of employment and alleges that “he was constructively dismissed on September 2, 2009 during a meeting with Pope”. There is no reference to express dismissal, although the material facts, including the statements I have found were made by Mr. Pope, were pleaded. Further, multiple witnesses testified about what was said at that meeting. I will consider whether Mr.

Thibert was expressly dismissed on September 2, 2009. [ 105 ] The next issue to decide is whether Mr. Thibert was expressly dismissed. Mr. Pope’s view was that Mr. Thibert had quit following the September 2, 2009 meeting and he did not fire him. Mr. Thibert’s position was that Mr. Pope’s statements that he could not sell and that he had been trying to fire him for two months were, in effect, a termination. I disagree. The purpose of the meeting was not to terminate Mr. Thibert; it degenerated and words were said in anger and frustration by both Mr. Pope and Mr. Thibert. Mr. Pope did not expressly terminate Mr.

Thibert on September 2, 2009. Resignation [ 106 ] In their submissions, Mr. Pope and Alberta Computers point to Kim’s September 1, 2009 email as evidence consistent with the view that Mr. Thibert had angrily resigned, rather than was fired, in the September 2, 2009 meeting, thus creating a dilemma for her. I do not accept that position, as the email was sent the day prior, and was the catalyst for the meeting, not sent in response to a dilemma created as a result of the meeting. [ 107 ] There is a dispute among the witnesses as to whether Mr.

Thibert said he was quitting, or if he more indirectly said he was “done”, and asked Mr. Pope if two weeks’ notice was required. I find that Mr. Thibert said was done at Alberta Computers and asked whether two weeks’ notice was required, which would, in some circumstances, be a resignation. [ 108 ] However, as with Mr. Pope’s statements in that meeting, I find Mr. Thibert spoke in anger and frustration. As I found Mr. Pope did not expressly terminate Mr. Thibert, I similarly find Mr. Thibert did not resign on September 2, 2009. Their statements were evidence

of escalating frustration and conflict in the workplace. Constructive Dismissal [109] In this case, Mr. Thibert argues that Mr. Pope’s actions prior to and during the meeting on September 2, 2009 amounted toconstructive dismissal, as his conduct conveyed his clear intention to no longer be bound by the terms of Mr.

Thibert’s employmentagreement. [110] Constructive dismissal was explained by the Supreme Court of Canada in Potter v New Brunswick (Legal Aid ServicesCommission), 2015 SCC 10 [Potter] at para 30: When an employer’s conduct evinces an intention no longer to be bound by the employment contract, the employee has the choice ofeither accepting that conduct or changes made by the employer, or treating the conduct or changes as a repudiation of the contract by theemployer and suing for wrongful dismissal. [111] The principles in Potter were recently referred to by the Alberta Court of Appeal in Roberts v Edmonton Northlands, 2019ABCA 229 at para 12. [112] Unfair treatment of an employee can also lead to constructive dismissal.

For example, in Sweeting v Mok, 2015 ONSC 4154,aff’d 2017 ONCA 203, the court held that a nurse was constructively dismissed following a profanity-laced meeting where she wasinsulted and told: “Go! Get out! I am so sick of coming into this office every day and looking at your ugly face”: at para 35. The courtconcluded, at para 37: An employer owes a duty to its employees to treat them fairly, with civility, decency, respect and dignity.

An employer who subjectsemployees to treatment that renders competent performance of their work impossible, or continued employment intolerable, exposesitself to an action for constructive dismissal. Where the employer’s treatment of the employee is of sufficient severity and effect, it willbe characterized as an unjustified repudiation of the employment contract. Whether such treatment is viewed as a breach of a specifiedfundamental implied term of the employment relationship or as a repudiation of the entire employment relationship, the result is thesame.

The employee is entitled to treat the employment contract as at an end, and to recover at least damages in lieu of reasonable notice.[Citation omitted] [113] Courts will take a flexible approach in determining whether an employer’s conduct evidences an intention to no longer bebound by the employment agreement: Potter at para 32.

Constructive dismissal can be established in two ways: either by a single act ofthe employer that breaches an essential term of the contract, or a series of acts that together establish that the employer no longerintended to be bound by the contract: Potter at para 43. [114] I consider both branches of the test in this case. [115] There are two steps to the establish whether an essential term of the contract has been breached. First, the court must determineobjectively whether the employer has made a unilateral change that breaches the employment agreement: Potter at paras 34-37.

Oncethat is objectively established, the next step is whether “a reasonable person in the same situation as the employee would have felt thatthe essential terms of the employment contract were being substantially changed”: Potter at para 39, citing Farber v Royal Trust Co, (SCC), [1997] 1 SCR 846 at para 26. [116] I have already found that one term of Mr. Thibert’s employment agreement was that Alberta Computers had a unique, fullyoperational managed services product ready for Mr. Thibert to sell that was not provided to him. There was no monitoring, no HelpDeskuntil Mr.

Thibert arranged for help desk services, and other issues with Alberta Computers’ ability to deliver the managed servicespromised. Mr. Thibert offered to take control of the managed services product through to delivery to the client, but this offer was nottaken up by Alberta Computers. Mr. Pope shifted his focus away from the managed services product in the summer of 2009, leaving Mr.Thibert without his input or support. [117] I conclude the existence of a managed services product for Mr. Thibert to sell was an essential term of the employmentagreement, and that by September 2, 2009, it had been breached.

This is the conclusion any reasonable person in Mr. Thibert’s situationwould have reached. [118] I have also found another term of Mr. Thibert’s employment agreement was that he would earn a base salary and commission,with the commission structure to be provided. Mr. Thibert was assured that with a base salary and commission, he would be able to earnat least $100,000 per year. Implicit in the agreement is that the commission structure would be provided within a reasonable time. Theprovision of a commission structure was an essential term of his employment agreement.

Despite his many efforts to ascertain the detailsof this structure, Mr. Pope did not provide one to him during the entire 6.5 months that he worked for Alberta Computers. [119] By September 2, 2009, Alberta Computers’ failure to provide a commission structure to Mr. Thibert was a breach of theemployment agreement. Again, this is the conclusion any reasonable person in Mr. Thibert’s situation would have reached. [120] While the above analysis under the first branch of the test set out in Potter is sufficient for a conclusion that Mr.

Thibert wasconstructively dismissed, I also consider the second branch for completeness. The issue for determination is whether Alberta Computers’actions evinced an intention to no longer be bound by the employment agreement. [121] I have found the work environment to be increasingly tense and hostile, culminating in the meeting on September 2, 2009, whenboth Mr. Pope and Mr. Thibert were upset and Mr. Pope said he had been trying to fire Mr. Thibert for two months, and that he could notsell. Mr. Thibert had raised concerns about the managed services product that were ignored.

Similarly, his requests for a commissionstructure and written employment agreement were ignored; instead, in July 2009, he was presented with an NDA that he did not sign. Bythe summer of 2009, he received little support from Mr. Pope, and Mr. Frey was no longer helping with marketing. Mr. Thibert was then

required to account for his time in 15-minute increments. Also in the summer of 2009, there was an on-going issue as to whether KimThibert could purchase the company van, as previously agreed, and the reasons why were not explained until Alberta Computers suedthe Thiberts in Provincial Court (which is discussed in more detail below in the

section on “Alleged Breaches by Mr. Thibert and SnapTechnologies”). [122] These circumstances led to an increasingly toxic work environment, and in creating this environment, Alberta Computersrepudiated the employment agreement, resulting in Mr. Thibert’s constructive dismissal. 3. Notice and Damages for Dismissal [123] As a result of my finding that Mr. Thibert was constructively dismissed, he is entitled to reasonable notice, or pay in lieu ofnotice, in order to terminate his employment: Honda Canada Inc v Keays, 2008 SCC 39 [Honda] at para 50.

Other issues arising in thecontext of his dismissal include whether he was induced to leave his previous employment to work at Alberta Computers, and whetherthe efforts he made to mitigate his losses following his dismissal were sufficient. [124] Mr. Thibert was employed by Alberta Computers for approximately 6.5 months. In the Counterclaim, Mr. Thibert seeks$130,000 in damages for 15 months’ salary and benefits as a result of his without-cause constructive dismissal.

He seeks a longer periodof notice because he says he was induced to leave his prior employment. [125] Alberta Computers submits that the amount claimed by Mr.

Thibert after working for seven months (rounded up) is outside therealm of serious consideration. [126] In assessing a reasonable notice period for termination, the Supreme Court of Canada in Wallace v United Grain Growers Ltd, (SCC), [1997] 3 SCR 701 [Wallace] at para 81 cites the principles articulated in Bardal v Globe & Mail Ltd (1960), (ON SC), 24 DLR (2d) 140 (Ont HC) [Bardal] at 145: There can be no catalogue laid down as to what is reasonable notice in particular classes of cases.

The reasonableness of the notice mustbe decided with reference to each particular case, having regard to the character of the employment, the length of service of the servant,the age of the servant and the availability of similar employment, having regard to the experience, training and qualifications of theservant. [127] Relevant factors in this case include the length of Mr. Thibert’s service and whether there was inducement, the availability ofsimilar employment for Mr. Thibert, and what efforts were made or should have been made by Mr.

Thibert to mitigate his damages. [128] The factors outlined in Bardal are not exhaustive: Wallace at para 82. One factor that is often considered is whether thedismissed employee was induced to leave secure employment: Wallace at 83. Inducement tends to lengthen the amount of noticerequired, although the significance of the inducement depends on the circumstances: Wallace at para 85. [129] Mr. Thibert was employed by Cabre from early 2008 until February 2009, when he started with Alberta Computers. He testifiedthat he was working full-time and was not looking for work at the time Mr.

Pope approached him to work for Alberta Computers. Mr.Thibert and Mr. Pope had discussions during several social events in late 2008 and in telephone conversations in early 2009. I accept thathe was induced to leave his employment with Cabre by an offer of secure employment with a comparable income, and an opportunity tobe closer to his family.

The issue is how much this extends the notice period in this case. [130] The law relating to inducement was reviewed by the Ontario Superior Court of Justice in Firatli v Kohler Ltd, [2008] OJ No2763 (SCJ) at paras 24-25: 24 The importance of the inducement in deciding the notice period will vary based on the facts of a particular case and is left to thediscretion of the trial judge.

Not all inducements are of equal weight when determining the length of the notice period [Wallace, supra, atpara 22]. 25 Courts, considering whether an employer’s recruitment methods amounted to inducement, have highlighted the following factors: (

a) the reasonable expectations of both parties…; (

b) whether the employee sought out work with the prospective employer…; (

c) whether there were assurances of long term employment…; (

d) whether the employee did due diligence before accepting the position by conducting their own inquiry into the company…; (

e) whether the discussions between the employer and hiree amounted to more than the persuasion or the normal “courtship” that occursbetween an employer and a prospective hiree…; and, (

f) the length of time the employee remained in the new position, the element of inducement tending to lessen with the longevity of theemployment… [Citations omitted] [131] The fact-specific nature of the impact of inducement on the length of the notice period was considered by Master Robertson inToole v Northern Blizzard Resources Inc, 2017 ABQB 760 [Toole] at para 21, where he explained: The concept of “inducement” of an employee to leave secure employment involves a spectrum of facts. At one end is an employee whois already on working notice when he or she is contacted by a recruiter.

That employee would be very motivated to pursue theopportunity, because his or her job is not secure. At the other end of the spectrum is an employee who is securely employed and notinterested in leaving for a new job until the recruiter offers some specific inducement, such as a signing bonus, more valuable benefits, or

a better salary. Most cases are somewhere along the spectrum. [ 132 ] I find Mr. Thibert was induced to leave a secure position to join Alberta Computers to sell a new managed services product that was unique and for which Alberta Computers already had one client. He had expressed to Mr. Pope that he needed to earn the same income as he was earning at Cabre, and Mr. Pope assured him he would be able to earn $100,000 with base salary and commission. These assurances from Mr. Pope suggested there would be job security with Alberta Computers, but as was found in Toole , I find Mr.

Thibert was giving up a secure position and was hired into a secure position with no express promises about how secure it was: Toole at para 25 . [ 133 ] Examples of longer notice periods awarded in short-term employment include: (

a) A 42-year old employee who had not found employment by the time of trial was entitled to six months’ notice after working for five months: Assouline v Ogivar Inc , [1991] BCWLD 2720 (BCSC) ; (

b) A 44-year old employee who worked for 5.5 months as a sales and services manager and had been actively recruited to join the company was awarded 12 months’ notice: Robertson v Weavexx Corp , [1997] BCJ No 245 (BCCA) ; (

c) A 32-year old employee worked for approximately eight months in middle management. He was not induced to leave secure employment. At trial, he was awarded notice of six months: Manchulenko v Hunterline Trucking Ltd , 2002 BCSC 966 ; (

d) An employee terminated after three months and given two weeks’ notice was found to be wrongfully dismissed and entitled to 5.5 months’ notice in addition to three months’ notice for inducement: Charles River Consultants Corp v Coombs , 2006 NLTD 174 ; and (

e) A 36-year old employee who was constructively dismissed after six months, but not induced to leave secure employment, received judgment for ten months’ notice: Taner v Great Canadian Gaming Corp , 2008 BCSC 129 . [ 134 ] I set out these decisions as examples where the notice period was extended where the employee had only worked for the employer for a short time, although as has been noted, each case turns on its particular circumstances.

These cases were decided a number of years ago when it may have been easier (or more difficult) to find new employment, and are referenced keeping that in mind. [ 135 ] In this case, Mr. Thibert was 36 years old and had worked at Alberta Computers for approximately 6.5 months at the time of dismissal. He was a salesperson responsible for selling the managed services product on behalf of Alberta Computers, and had been induced to leave secure employment.

I have found that a term of his employment was that he would earn $100,000, comprised of base salary and commissions, with the commission structure to be agreed; however, during his entire time at Alberta Computers, no commission structure was provided and he earned a base salary of $2,800 (gross) every two weeks. I found that actual salary to be a term of his employment agreement, pending finalizing a commission structure.

I conclude that the actual salary he was earning should be used for the purpose of calculating the amount he should be paid in lieu of notice. [ 136 ] Also relevant to damages in lieu of notice is whether Mr. Thibert made sufficient efforts to mitigate his losses. An employee who has been dismissed has an obligation to mitigate the damages flowing from the dismissal by taking reasonable steps to secure comparable alternative employment: Cunningham v Hillview Homes Ltd , 2015 ABQB 304 [ Cunningham ] at para 89 [citations omitted].

The onus is on the employer to prove any alleged failure to mitigate: Cunningham at para 89 . There is more than one way to mitigate; mitigation does not have to be perfect: Deputat v Edmonton School District No 7 , 2008 ABCA 13 at para 27 . [ 137 ] Shortly after his termination, Mr. Thibert contacted Cabre about returning to his previous position, but his position had been filled. He made other efforts to secure employment, including contacting trucking companies in the Grande Prairie area to see if there were any driving positions available, and making employment inquiries in the Salmon Arm and Kelowna areas.

Mr. Thibert also contacted approximately six IT companies about whether they had any open sales positions. [ 138 ] One IT company, PCIT, contacted Mr. Thibert and offered him work as a salesperson. He testified that he worked for PCIT for 7 to 10 days, but quickly realized that PCIT’s managed services product was in a developmental stage. He was offered $3,000 in monthly base salary with an opportunity to earn up to $2,000 per month in additional commissions, which would not be sufficient to support his family and was a large reduction in pay from what he had been earning at Alberta Computers. Mr.

Thibert never received any money from PCIT. [ 139 ] In addition, his employment relationship with PCIT was disrupted when Alberta Computers’ lawyer sent a letter dated October 1, 2009 to PCIT, Mr. Thibert and Mr. McIntosh. This letter advised that Mr. Thibert was in breach of his fiduciary duties owed to Alberta Computers, and suggested that PCIT could be held liable for any actions by Mr. Thibert to have Alberta Computers’ clients transfer their business to PCIT. [ 140 ] On September 29, 2009, Mr. Thibert set up his own business, Snap Technologies.

It ultimately failed in 2010, but he was able to secure some clients and undertake some work. This is sufficient for mitigation, particularly as Mr. Thibert considered other employment opportunities before moving forward to set up his own business: see, for example, Wychopen v Northwestern Utilities Ltd , 2003 ABQB 593 at para 69 . [ 141 ] Alberta Computers has not satisfied me that Mr. Thibert did not make reasonable efforts to mitigate his damages. I find Mr.

Thibert did look for employment opportunities, and that his decision not to pursue further employment at PCIT was reasonable, given both the significantly lo

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