2017 QCCQ 8341, 2017 QCCQ 8341

Saleh c. Société immobilière Landmark inc. 2017 QCCQ 8341 COURT OF QUEBEC Small Claims Division CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL Civil Division No: 500-32-150566-158 DATE: May 30, 2017 ______________________________________________________________________ PRESIDED BY THE HONOURABLE DAVID L. CAMERON, J.C.Q. ______________________________________________________________________ BURT SALEH, Plaintiff v.

SOCIÉTÉ IMMOBILIÈRE LANDMARK INC., Defendant ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] The Plaintiff, Burt Saleh, a real estate broker, sues his former employer, Société Immobilière Landmark Inc. (“Landmark”) in relation to his employment with Landmark which commenced on January 1, 2012 and which terminated effective July 18, 2014, under a written notice Mr.

Saleh gave Landmark on July 11, 2014 (P-2a). [ 2 ] The amount claimed of $ 15,000 corresponds to the maximum that may be awarded in the Small Claims Division. Mr. Saleh breaks down his claim as follows: 1. Bonus for the period of January 1, 2012 to April 25, 2012 ($ 8,000); 2. Base salary from March 16, 2014 to July 18, 2014 ($ 12,000); 3. A commission he refers to as “referral transaction” without specifying the amount; and 4.

Compensation under a special agreement he alleges was made on March 1, 2013 ($ 4,000). [ 3 ] He makes his claim in respect of two distinct employment contracts, the first which arose in the early part of 2011 and the second dated May 8, 2012. [ 4 ] In its written Contestation, Landmark takes the position that the Plaintiff was not entitled to any bonus from the period of January 1, 2012 to April 25, 2012, the bonus entitlement being based on objectives that Mr.

Saleh allegedly never achieved. [ 5 ] In fact, Landmark alleges that it dismissed the Plaintiff on April 11, 2012 with two weeks’ notice, effective, therefore, April 25, 2012. [ 6 ] It further alleges that any claim for a bonus is prescribed, i.e. three years after April 25, 2012.

The action was brought more than three years after this date on December 30, 2015. [ 7 ] With respect to the claim for the base salary from March 16 to July 18, 2014, Landmark alleges that, because of the Plaintiff’s poor performance, it changed his basis of remuneration, which had been stipulated in the second employment contract as including a base salary of $ 3,000 per month so that, as of March 16, 2014 his compensation was based on commissions only rather than a base salary.

It alleges that since the Plaintiff continued to work after this change occurred, he thereby implicitly accepted this modification to his employment contract. Thus, it would not owe any base salary after March 16, 2014. [ 8 ] Landmark acknowledges that the Plaintiff terminated his employment July 18, 2014. [ 9 ] As well, in its written Contestation, Landmark admits that it owed a referral commission, which it states to be in the amount of $ 562.50. [ 10 ] After the close of evidence, Landmark was permitted to provide additional evidence that it had in fact paid a commission in the

amount of $ 10,901.30 as shown in the pay registry for the period ending March 16, 2014. The Court is satisfied that, apart from the specific issues raised below, there is no proof of an unpaid commission on a specific transaction. [ 11 ] Finally, with respect to the claim for the compensation of $ 4,000, Landmark alleges that, pursuant to an agreement that was made in March 2013, Mr. Saleh would have been entitled to this compensation if he had closed any property management contract but that, given that he did not close any such property management contract, he would not be so entitled to any commission.

ISSUES [ 12 ] In order to resolve this conflict, the Court must answer the following questions: 1. Is any bonus owed to the Plaintiff for the period January 1, 2012 to April 25, 2012 and, if so, is this claim prescribed? 2. Is there an outstanding compensation of $ 4,000 due pursuant to an alleged verbal agreement made on March 1, 2013? 3. Does Landmark owe Mr. Saleh any arrears of salary for the period just prior to the termination of the employment, July 18, 2014, or was his remuneration effectively changed from a base salary to a pure commission basis for that period? FACTS [ 13 ] Landmark confirmed Mr.

Saleh’s employment in a letter dated February 16, 2011 (P-2), although it is not signed by its author, Robert Cressaty, Vice-President Leasing. It is signed by Mr. Saleh and it is not in issue that this document constituted, with its annex, the employment agreement. [ 14 ] It provided for a base salary of $ 100,000 and “performance incentive pay, commonly referred to as a bonus, the structure of which is listed in the Annex”. [ 15 ] Mr. Saleh was hired in the advisory-services function of Landmark, a group that advised clients as to their leasing affairs. [ 16 ] Mr.

Saleh received positive reviews at the end of the third month and at the end of 2011. In February 2012 he received his bonus for 2011. He was congratulated on having the second highest bonus in the department. [ 17 ] Things changed however when the individual whom Mr. Saleh had been hired to replace was to be reintegrated into the business and arrangements were made for the division to be sold. [ 18 ] Mr. Saleh’s employment situation changed dramatically when he received from his superior, Mr. Cressaty, a letter dated April 11, 2012 (D-4): … terminating your employ effective immediately.

Landmark Properties Inc feels that your profile is not compatible with the expectations of our clients and that this has jeopardized relations with the latter to what we perceive as a dangerous degree. We regret that efforts to sensitize you to client mindset for this position were not successful. Your last day of work will be April 25 2012. [ 19 ] Landmark attempts to justify this change based on certain complaints received from a few clients but the exercise is not particularly credible because Mr.

Saleh was not given notification in a timely manner of these complaints. [ 20 ] Landmark’s position is also not particularly credible given the very strong encouragement Mr. Saleh had received in his year-end review and because of the accompanying substantial bonus. [ 21 ] It is more than plausible that the termination of Mr. Saleh’s status was related to the return, that had not been planned, of the person he was hired to replace, and the restructuring of the business through the disposal, to a new entity, of the advisory business. [ 22 ] Although the change of status was voiced as a dismissal, Mr.

Saleh continued to work and entered into a new employment agreement dated May 8, 2012 entitled “Leasing Agent Employment Agreement”. There was, thus, still mutual confidence and respect between the parties at that time. [ 23 ] The new modalities of employment are drastically different, however, in the new contract, with compensation being a base salary of $ 3,000 per month and variable compensation based on a commission formula. [ 24 ] There is also a modality concerning the previous commission, since only the first four months of the 2012 period had been worked by Mr. Saleh under the old agreement.

Under the title “TERM, DURATION, WORK AND CONDITIONS” we read: START DATE This arrangement comes into effect on May 07, 2012; under it, you are also entitled to a prorated bonus pool participation, based on your individual results versus the budget objective for the period ending on April 30, 2012 in the context of your previous employment; This may translate into your bonus being calculated on the basis of the current incentive (Bonus) Structure for Leasing and Advisory Services, on or the basis of a modified version, as the incentive structure is being adjusted. [ 25 ] These rather vague modalities make it clear that Mr.

Saleh was given the expectation of a prorated bonus for the first four

months of the year but it becomes very difficult to ascertain how the computation of such a bonus would be made and when it would be payable. [ 26 ] Presumably, however, since Landmark had a custom of paying bonuses shortly after the year end, it is likely that this bonus would have accrued, perhaps along with other amounts flowing from the employment, beginning in May 2012, in the early part of 2013. [ 27 ] In February 2013, Mr.

Saleh did not receive a bonus and he was given no review. [ 28 ] On March 1, 2013, he was called into a meeting with Luc Sicotte, President and Chief Executive Officer, in the company of Peter Karahalios, referred to by the parties as “PK” , the person in charge of Human Resources. [ 29 ] Mr. Sicotte informed Mr. Saleh that Mr. Cressaty, the person in charge at the division where Mr. Saleh had previously worked, had stated that he would not agree to any bonus. [ 30 ] According to Mr. Saleh’s testimony, Mr. Sicotte stated that he disagreed with this decision but that he would not undermine it.

He did, however, offer, in place of the bonus, a compensation of $ 4,000 if Mr. Saleh would match one of his tenant clients as a lessee of a building managed in Landmark’s managed portfolio for one of its owner clients. [ 31 ] Mr. Saleh asserts that in June 2013 a transaction that he referred to Landmark bore fruit and he claimed the $ 4,000 from Mr. Sicotte. [ 32 ] Mr.

Saleh asserts that the admission he made in paragraph 19 of the Contestation, where Landmark admits owing a referral commission for a transaction with one of its landlord clients, is sufficient confirmation of his entitlement to the $ 4,000 commission. [ 33 ] In contrast to this testimony, Luc Sicotte testified that he had made the promise to Mr. Saleh that he would give him $ 4,000 in return for getting “some leasing revenues”. He asserts that the commission of $ 562.50 represents something that is inadequate to trigger such a bonus. [ 34 ] This testimony contradicts the written Contestation signed by Mr.

Sicotte at paragraphs 22 and 23. According to those allegations, the $ 4,000 compensation would have been paid if Mr. Saleh had closed a “property management contract”. [ 35 ] Testifying about this contradiction, he stated that this might be confusion in the mind of PK, but that bringing a management contract would have also been taken into account in a bonus payment. [ 36 ] Mr.

Sicotte, in his testimony, links the $ 4,000 bonus to exceeding objectives as set out in the document called the “Bonus Tracker”, a management tool used to track throughout the year the employee’s progress in terms of various objectives that are postulated. Though it may have been a planning tool, the Bonus Tracker does not have probative value as to whether a bonus would be payable, as the criteria for a bonus are not objectively stated. [ 37 ] We come finally to the termination of the employment. Much of the testimony of Mr.

Sicotte and Gil Kastner, the person in charge of the division, had to do with their perception of Mr. Saleh’s performance in this last phase of his employment. Mr. Saleh also addressed these issues in some depth. [ 38 ] The question, however, is that of the termination of the employment. Mr. Saleh asserts that he was informed by Mr. Kastner, in early March 2014, that he had decided to terminate Mr. Saleh’s contract effective immediately. [ 39 ] Mr. Saleh then discussed the matter with PK, as head of Human Resources, who confirmed he had received no official word nor any instructions confirming a change to Mr.

Saleh’s status or contract and that no action would be considered official or binding unless and until it was stated in writing. [ 40 ] Mr. Saleh testifies that the last payslip he received included the base salary for the period ending March 2, 2014 and that he did not stop working for and representing the Defendant in the meantime. [ 41 ] He approached PK again and was informed that there was still no confirmation of the dismissal. The payroll records submitted by Landmark show that there was no salary paid after the March 16, 2014 period. [ 42 ] At a certain point, the situation became intolerable for Mr.

Saleh. [ 43 ] He was not being paid, had not been officially fired, and was not being treated well in terms of his office or work station, which had been in a state of flux. He felt oppressed. [ 44 ] On July 11, 2014, he wrote on Landmark letterhead (P-2a): To whom it may concern, I AM OUT OF HERE (EFFECTIVE JULY 18, 2014, IN ACCORDANCE WITH EMPLOYMENT CONTRACT) [ 45 ] After submitting this rather informal notice, he was asked by PK to present a more formal looking letter of resignation and he complied with this request.

ANALYSIS [ 46 ] As sometimes occurs in cases involving employment, the parties spent a great deal of their energy in the presentation of the case

dealing with the relative value of the employee’s contribution in the various roles he played and the justification or lack thereof of the employer in organizing the means of production, according to its own goals and culture, to Mr. Saleh’s detriment. [ 47 ] This was particularly evident in the evidence dealing with the termination of Mr.

Saleh’s employment as it coincided with the spinning-off of the division for which he worked and its sale to a new entity during the early months of 2013. [ 48 ] In relation to the period after he was transferred to another division and worked in a different mode, much of Landmark’s evidence was directed at explaining why he was not considered to be productive enough and much of Mr. Saleh’s testimony dealt with the manner in which he was treated, the unfairness of the situation, etc. [ 49 ] But the issues the Court must decide are more narrow and, to a certain extent, more technical and less qualitative.

Returning to the first of the three issues raised in paragraph 12 above, the Court is of the view that Mr.

Saleh cannot, at this stage, claim the bonus he was hoping to receive relating to the period of January 1, 2012 to April 25, 2012. [ 50 ] Under the document that he signed as of May 8, 2012, an entitlement to this bonus was rolled into his new modalities of employment and this commission would have been payable with reference to both the period ending April 25, 2012 and the rest of the year. [ 51 ] The decision was made not to pay him a bonus, nor to provide him with the basis on which that decision was made. An offer was made to substitute the bonus with a lump sum payment of $ 4,000, if Mr.

Saleh referred a client from his tenant clientele who would conclude a lease with a client from Landmark’s property portfolio. [ 52 ] Landmark’s conduct in not justifying the lack of a bonus, in making ambiguous comments as to whether that was appropriate or not, and in converting the bonus entitlement, if any, into a lump sum on new conditions could be criticized and, in the final analysis, this conduct may well be considered as a breach of contract. [ 53 ] Mr.

Saleh, however, accepted the new conditions implicitly when he left the meeting, went on working and when he claimed the payment of the $ 4,000 lump sum shortly thereafter having, as far as he was concerned, provided the performance required. [ 54 ] When an employee accepts a change in working conditions and insists upon the new working conditions being enforced, he has consented to the modification of the employment agreement. This is what occurred here. [ 55 ] Since the bonus contemplated in the second employment contract would have come due some time in early 2013, there is no prescription problem.

There is, however, no valid claim for a bonus except for the $ 4,000 into which the bonus entitlement was converted with Mr. Saleh’s acquiescence. [ 56 ] Turning thus to the second question raised in paragraph 12 above, the evidence is sufficient to establish his entitlement to that bonus as Mr. Saleh points out with reference to paragraph 19 of Landmark’s written Contestation. [ 57 ] The Court prefers Mr. Saleh’s recollection of the March 2013 meeting to that of Mr.

Sicotte, the latter having given two different versions of the new deal, namely the version in his testimony and the very different version in the written Contestation he signed. The Court draws a negative inference from the absence of PK as a witness. [ 58 ] Since there is no reason to doubt Mr. Saleh’s sincerity in describing the events, the Court considers he has fulfilled his burden of proof on that point.

In so doing, he also proves his own renunciation to a bonus under the previous arrangement, the one that carried forward the bonus entitlement, if any, from the first contract into the second contract, and his acquiescence to this bonus being substituted with the $ 4 000 lump sum. [ 59 ] The third question in paragraph 12 above concerns arrears of salary. [ 60 ] The Court accepts Mr. Saleh’s testimony that PK told him words to the effect that it was business as usual until he received a written notice to the contrary. Therefore, as an organization, Landmark gave two conflicting positions to Mr.

Saleh, the first from his immediate supervisor who told him he was fired and the second from the head of Human Resources who told he was still employed under the same basis until further written notice. Even when Mr. Saleh followed up with an inquiry, PK confirmed that it was still not confirmed that he had been fired. [ 61 ] The position Landmark took at the hearing is that Mr.

Saleh remained as an employee but with no base salary and on a strictly commission basis. [ 62 ] If this had truly been the intent of Landmark, a very organized business enterprise, to say the least, it would have been stated in some documentary form. For a decision of that sort to be made, the head of Human Resources would have had to be involved, or at least informed from the person he reported to, of the decisions that were made which had financial and organizational implications. [ 63 ] The Court therefore concludes that Mr.

Saleh is entitled to the base salary of $ 3,000 per month as calculated between the end of the last pay period until his termination at the end of the notice period he gave, a total of approximately four months ($ 12,000). [ 64 ] The total comprised of the base salary and lump sum would be $ 16,000, but the Court must cap the judgment at the Small Claims threshold of $ 15,000. [ 65 ] It is unfortunate that the relationship between Mr.

Saleh and Landmark, which, over a substantial period, had been maintained on the basis of mutual respect and trust, ended in a litigious manner, but this Court hopes that its judgment, which brings about the technical resolution of issues related to the end of employment, will also permit the parties to have a more satisfactory closure than was the case when the business and professional relationship ended.

BY THESE REASONS, THE COURT: CONDEMNS the Defendant Société Immobilière Landmark Inc. to pay to the Plaintiff, the sum of $15,000, together with interest at the legal rate and the additional indemnity provided in

Article 1619 of the Civil Code of Québec , calculated from November 25, 2015; THE WHOLE with judicial costs in the amount of $ 200 for the Court stamp. __________________________________ DAVID L. CAMERON, J.C.Q. Date of hearing: March 14, 2017