Docket: CACV2169 Capital Pontiac Buick Cadillac GMC Ltd. (Defendant) Appellant - v. -, 2013 SKCA 80

THE COURT OF APPEAL FOR SASKATCHEWAN Citation: 2013 SKCA 80 Date: 2013-07-22 Between: Docket: CACV2169 Capital Pontiac Buick Cadillac GMC Ltd. (Defendant) Appellant - and - Sergio Coppola (Plaintiff) Respondent Coram: Lane, Richards and Caldwell JJ.A. Counsel: W. Timothy Stodalka and Eric Marcotte for the appellant Mervin C. Phillips for the respondent Appeal: From: 2011 SKQB 318 Heard: October 11, 2012 Disposition: Allowed, in part Written Reasons: July 22, 2013 By: The Honourable Mr. Justice Caldwell

In Concurrence: The Honourable Chief Justice Richards The Honourable Mr. Justice Lane Caldwell J.A. I. Introduction [1] The appellant employer appeals from the whole of the judgment after trial in a wrongful dismissal claim where the judgeawarded the respondent former employee $66,384.74 as pay in lieu of notice, $1,650.00 for loss of vehicle benefit and $20,000.00 inaggravated damages, with pre-judgment interest and costs (see: 2011 SKQB 318). I would allow the appeal with respect to the award ofpre-judgment interest but otherwise dismiss the appeal. [2] The relevant facts are as follows.

The respondent was 34-years-old when the appellant hired him as its Fleet Manager. Theappellant quickly promoted the respondent and he assumed the additional duties of a Finance Manager. He excelled at these combinedduties and his remuneration grew commensurately over the 22 months of his employ. The appellant then gave the respondent a two-weeknotice of lay-off and told him the decision had been based on tenure and he was the junior-most of three Finance Managers. Therespondent accepted this decision and found similar temporary employment elsewhere, but only for a month.

He then decided to start upa mortgage brokerage with a business partner. In the course of this endeavour, an employee of the appellant told the respondent’sbusiness partner to be careful of the respondent and alleged the respondent had been dismissed because a trade-in vehicle had gonemissing. Upon learning of this, the respondent had his lawyer write to the appellant seeking an explanation as to why this allegation hadbeen made. Receiving no response, the respondent commenced the within action for wrongful dismissal. [3] Certain procedural facts are also relevant to the award after trial.

In particular, in its statement of defence, the appellant alleged ithad dismissed the respondent for cause because he had defrauded a customer by telling her that her trade-in vehicle was worthless andthat he had then sold the vehicle for his own gain. Sometime after examinations for discovery had taken place, it became evident thatthis allegation was unsustainable on the evidence. At this point, a judge of the Court of Queen’s Bench ordered the appellant to amend itsstatement of defence to remove the allegation.

The appellant did so, but it maintained that it had dismissed the respondent for cause. [4] At trial the respondent was found to have been wrongfully dismissed and the judge assessed the damages as set forth in the firstparagraph.

As to the moral or aggravated damage claim, the respondent testified that circumstances of and subsequent to his dismissalhad had a significant negative impact on him and his family, but he failed to provide any evidence to that effect other than his testimonyand that of his wife; he did not attend on any independent medical professional to assess his alleged states of stress, depression, anxiety,etc. The respondent did, however, receive support and treatment from his wife, who is a psychiatric nurse.

II. issues [5] The appellant’s notice of appeal contains six grounds of appeal which address the following three distinct issues: (

a) Whether the trial judge erred in awarding six month’s pay in lieu of notice? (

b) Whether the trial judge erred in awarding $20,000 in aggravated damages? (

c) Whether the trial judge erred in awarding pre-judgment interest? III. Analysis (

a) Did the trial judge err in awarding six months’ pay in lieu of notice? [6] In his assessment of the reasonable notice period, the trial judge correctly identified the jurisprudence which explains howreasonable notice is to be assessed in a case of wrongful dismissal. Chief among these cases is Bardal v. The Globe & Mail Ltd. (1960), (ON SC), 24 D.L.R. (2d) 140 (Ont. H.C.), the ratio of which was adopted by the Supreme Court of Canada inMachtinger v. HOJ Industries Ltd., (SCC), [1992] 1 S.C.R. 986, at pp. 998-99, and subsequently endorsed by the Courtin Honda Canada Inc. v.

Keays, 2008 SCC 39, [2008] 2 S.C.R. 362 at paras. 28-32. In Bardal, McRuer C.J.H.C. set out the test fordetermining reasonable notice in these terms (at p. 145): There can be no catalogue laid down as to what is reasonable notice in particular classes of cases.

The reasonableness of thenotice must be decided with reference to each particular case, having regard to the character of the employment, the length of service ofthe servant, the age of the servant and the availability of similar employment, having regard to the experience, training and qualificationsof the servant. [7] Since Machtinger, the assessment of reasonable notice has been a context-driven exercise undertaken by considering the fourcentral, but non-exhaustive, factors set out in Bardal:

i) the character of the employment; ii) the length of service; iii) the age of theformer employee and the availability of similar employment; and iv) the employee’s experience, training, and qualifications. In Keays,the Supreme Court of Canada emphasized the contextual element of the assessment stating (at para. 29) that the Bardal factors “can only

be determined on a case-by-case basis.” [8] Here, as noted, the trial judge correctly identified the Bardal factors and, as directed, he assessed them within the context of thecircumstances at hand. The issue then is whether the trial judge properly assessed the specific circumstances of this case. In this respect,the standard of review cautions an appellate court to show a certain measure of deference to the trial judge’s decision. In Naylor GroupInc. v.

Ellis-Don Construction Ltd., 2001 SCC 58, [2001] 2 S.C.R. 943, Binnie J., for the Court, set out the applicable standard ofappellate review in these terms: [80] It is common ground that the Court of Appeal was not entitled to substitute its own view of a proper award unless it could beshown that the trial judge had made an error of principle of law, or misapprehended the evidence (Lang v. Pollard, (SCC), [1957] S.C.R. 858, at p. 862), or it could be shown there was no evidence on which the trial judge could have reached his or herconclusion (Woelk v.

Halvorson, (SCC), [1980] 2 S.C.R. 430, at p. 435), or the trial judge failed to consider relevantfactors in the assessment of damages, or considered irrelevant factors, or otherwise, in the result, made “a palpably incorrect” or “whollyerroneous” assessment of the damages (Andrews v. Grand & Toy Alberta Ltd., (SCC), [1978] 2 S.C.R. 229, at p. 235;Laurentide Motels Ltd. v. Beauport (City), (SCC), [1989] 1 S.C.R. 705, at p. 810; Widrig v. Strazer, (SCC), [1964] S.C.R. 376, at pp. 388-89; Woelk, supra, at pp. 435-37; Waddams, supra, at para. 13.420; and H.D.

Pitch and R.M.Snyder, Damages for Breach of Contract (2nd ed. 1989), 15 para. 5). Where one or more of these conditions are met, however, theappellate court is obliged to interfere. [9] The standard has been interpreted as affording “a high level of deference” to the decision of a trial judge with respect todiscretionary awards of this nature (see: MacWilliams v. AMEC Americas Ltd., 2012 NBCA 46, 99 C.C.E.L. (3d) 171 at para. 55, whereDrapeau C.J.N.B., citing UPM-Kymmene Miramichi Inc. v.

Walsh and DeWolfe, 2003 NBCA 32, 257 N.B.R. (2d) 331, paused to cautionthat it was unlikely “such a lengthy period would have been allowed to stand were it not for the standard of review”).

In Keays (at para.32), Bastarache J., for the majority, underscored the importance of appellate deference with respect to awards of pay in lieu of notice.Significantly, even though he found that the trial judge in Keays had erred in his analysis of the Bardal factors, Bastarache J.nevertheless upheld the award, specifically noting that the trial judge’s award was entitled to deference. [10] The standard of deference acknowledges the highly contextual nature of the determination of a reasonable notice period and therole of the trial judge in that subjective determination.

There is no single correct answer as to what constitutes reasonable notice in anycase; rather, there is a “range of reasonableness”. On this point, Laskin J.A.’s reasoning in Minott v. O’Shanter Development Co. (1999), (ON CA), 168 D.L.R. (4th) 270 (Ont. C.A.), is instructive as it captures the measure of deference which is owed by anappellate court in terms of the range of reasonableness: 62 [An argument that the notice period award is in error] must be judged against the standard of appellate review of wrongfuldismissal awards. Determining the period of reasonable notice is an art not a science.

In each case trial judges must weigh and balance acatalogue of relevant factors. No two cases are identical; and, ordinarily, there is no one “right” figure for reasonable notice. Instead,most cases yield a range of reasonableness. Therefore, a trial judge's determination of the period of reasonable notice is entitled todeference from an appellate court. An appeal court is not justified in interfering unless the figure arrived at by the trial judge is outsidean acceptable range or unless, in arriving at the figure, the trial judge erred in principle or made an unreasonable finding of fact.

If thetrial judge erred in principle, an appellate court may substitute its own figure. But it should do so sparingly if the trial judge’s award iswithin an acceptable range despite the error in principle. 63 O’Shanter submits that in awarding 13 months the trial judge made two errors in principle: first, she relied on the trial decision inCronk v. Canadian General Insurance Co. [footnote omitted]; and, second, she determined the period of reasonable notice by using as astarting point the rule of thumb that one year’s service equals one month’s notice.

O’Shanter also submits that even apart from theseerrors in principle, 13 months notice is excessive and beyond the upper limit of 12 months for clerical employees referred to by this Courtin Cronk. O’Shanter submits that a reasonable period of notice was in the range of six months. 64 I agree that the trial judge’s reasons reflect the two errors in principle alleged by O’Shanter. I do not agree, however, that thiscourt’s decision in Cronk establishes an upper limit of 12 months notice for a manual worker such as Minott. And I do not agree that anaward of damages equivalent to 13 months notice is unreasonable.

Although perhaps at the very high end, 13 months notice for Minott iswithin an acceptable range.

Therefore, I would not interfere with the trial judge’s award. [11] Put simply, the standard of appellate review of an award of damages on wrongful dismissal is such that, notwithstanding that thetrial judge may have erred in principle, if the award is within the accepted range of possible awards the appellate court should bereluctant to interfere. [12] Having identified the standard, I turn to determine what the accepted range of pay in lieu of notice is in the circumstances at hand.This is somewhat difficult because each case is so context-specific that, as Bastarache J. observed in Keays (at para. 29), “[t]hey can onlybe determined on a case-by-case basis.” Nevertheless, based on my review of two secondary sources (Ellen E.

Mole, Wrongful DismissalPractice Manual, 2d ed., loose-leaf (Markham, ON: LexisNexis, 2006) vol. 2, and Howard A.

Levitt, The Law of Dismissal in Canada,3d ed., loose-leaf (Toronto, ON: Carswell, 2012) vol. 2), the broad range of pay in lieu of notice for similarly aged employees in similartypes of employment for similar years of service is between one month and twelve months, with the majority of cases falling within thetwo to six month range.[1] [13] As might be expected, anomalies appear in the cases which comprise the range: there were examples of nine months’ notice for asales representative after serving only 11 months; eight months’ notice for a salesperson after serving 2.5 years; and even 12 months for asales manager serving two years.

But, generally speaking, after adjusting for outliers, the range was between two and six months’ pay inlieu of notice in circumstances similar to those at hand. As such, the trial judge’s award of six month’s pay in lieu of notice is right at thehigh-end of the range of reasonable notice; however, as it is still within the range it is not unreasonable on its face. [14] I turn now to consider the trial judge’s assessment of the specific circumstances of this case.

In Keays (at para. 32), Bastarache J.observed that it is an error to overemphasize any one of the Bardal factors or to give any one factor “disproportionate weight.” On my

own analysis, based upon my review of the jurisprudence and the Bardal factors arising in circumstances of this case, I would have placed the appropriate notice period in the middle of the accepted range, or at three months. The trial judge pegged it at six months’ notice.

While the standard of review allows for a difference of this degree, as the trial judge’s assessment is within the accepted range albeit at the upper limit, I was concerned that the trial judge might have erred in principle by overemphasising or giving disproportionate weight to the length of service factor in assessing the notice period that high. Let me explain. [ 15 ] In his reasons, the trial judge said (at para. 39) that, in the past, “disproportionate weight” had often been given to “length of service” as a Bardal factor.

This statement was followed immediately by his opinion that the “rule of thumb” of one month of notice for each year of service has “severely penalized short service employees.” This bears some scrutiny as this Court has neither adopted nor rejected the “rule of thumb” approach of one-month’s notice per year of service. [ 16 ] At first glance, the trial judge appears to have erred in principle because his statement seems to overemphasize or give disproportionate weight to the shortness of a short-service employee’s service under the length of service factor.

Nonetheless, while they strike as incorrect upon first reading, the trial judge’s comments are in fact supported by logic and case authority. [ 17 ] His comment strikes as incorrect because the same moral claim to notice in a wrongful dismissal case does not and cannot arise for short-term employees as it does for long-term employees. The long-term employees’ moral claim to notice is grounded in the abrupt, untimely and unwarranted disruption of a long term of service by the employer. Any concept of a moral claim for short-term employees would seem paradoxical to this underpinning.

It strikes as peculiar, at least, then for the trial judge to hold that short-service employees have been historically “severely penalized” by the rule of thumb approach to wrongful dismissal compensation. [ 18 ] Nevertheless, the trial judge’s opinion is supported by jurisprudence in British Columbia which proposes a three to six month notice floor for short-service employees (see: David Harris, Wrongful Dismissal , loose-leaf ed. Vol. 2 (Toronto, ON: Carswell, 1989) at 4-18.1).

This proposition apparently originated in an understanding that (1) the termination of a short term of employment by a wrongful dismissal might have a traumatizing impact on an employee which is disproportionate relative to the short length of service, and (2) it is difficult for a prospective hire to explain a brief period of employment in an employment record thus making it more difficult to gain subsequent employment.

I pass no judgment on the merit of this approach, except to say that the concept of a floor would seem to me to run counter to Bardal . [ 19 ] Regardless, it seems clear from the jurisprudence that most appellate courts have been disinclined to adopt the rule of thumb approach. This may be because the very nature of the assessment of a reasonable notice period, as grounded by the Bardal factors, logically runs against a rule of thumb concept. Under Bardal , the court must consider subjective factors in reaching a determination as to what is reasonable in the circumstances.

This analysis does not readily lend itself to the application of a mathematical formula, even if merely as the guideline of one month’s notice per year of service. [ 20 ] In fact, Laskin J.A., for the Ontario Court of Appeal, outright rejected the rule of thumb approach in Minott in these terms: 69 In my view, [the trial judge] also erred by using as a starting point for determining the period of reasonable notice, the “rule of thumb” that an employee is entitled to one month’s notice for every year worked. She explained her “rule of thumb” approach in the following passage in her reasons.

Although case authorities seldom refer to it, there has been a long-standing rule of thumb applied by specialists in employment law within the legal profession. According to this rule of thumb, one should allow one month of notice for every one year of service. That is the general rule.

After that, there are adjustments up or down for extraordinary circumstances usually taking into account the list of factors set out in Bardal , those being length of service, age and availability of similar employment. … 71 Those who support the rule of thumb approach to calculating the period of reasonable notice argue that it accords with popular perception, that it is reflected in corporate severance policies, and, most important, that it provides “some predictability and certainty to the calculation ... while at the same time allowing for flexibility by adjusting for various factors.” 72 Predictability, consistency and reasonable certainty are obviously desirable goals in employment law - both for employers and for those advising employees who have been or are about to be dismissed … These goals, however, are best achieved by a careful weighing and blending of the Bardal and other factors relevant to the calculation of reasonable notice, by establishing reasonable ranges for similar cases, recognizing that no two cases are the same, and even by establishing upper limits for particular classes of cases where appropriate. 73 The rule of thumb approach suffers from two deficiencies: it risks overemphasizing one of the Bardal factors, “length of service”, at the expense of the others; and it risks undermining the flexibility that is the virtue of the Bardal test.

The rule of thumb approach seeks to achieve this flexibility by using the other factors to increase or decrease the period of reasonable notice from the starting point measured by length of service. But to be meaningful at all, this approach must still give unnecessary prominence to length of service. Thus, in my opinion, the rule of thumb approach is not warranted in principle, nor is it supported by authority. 74 Moreover, it is not reflected in the wrongful dismissal awards made daily by trial judges.

In a recent paper, Barry Fisher used his wrongful dismissal data base (nearly 1600 cases at the time) to show that the rule of thumb had little or no validity as a predictor of reasonable notice for short term or long term employees, though it had “some validity for cases in the mid-seniority range.” [footnotes omitted] [ 21 ] Laskin J.A.’s reasoning is persuasive. Adherence to the rule of thumb approach risks an overemphasis of one particular Bardal factor ( i.e. , the length of service factor) and creates a resistance to flexibility.

This would be in error as no single Bardal factor may be given such disproportionate weight, as Bastarache J. affirmed in Keays .

[22] Of course, when used as a starting-point, the rule of thumb approach has the attractiveness of lending some measure ofpredictability and certainty to the calculation of reasonable notice while, at the same time, affording a similar measure of flexibility toadjust for other Bardal factors.

Nevertheless, although the rule of thumb seems intuitively practical it is not, apparently, terriblyreflective of the actual quanta of awards of pay in lieu of notice in wrongful dismissal cases.[2] Practically-speaking then, whileemployers may wish to use the “one month’s notice per year of service” rule of thumb as a guideline in their day-to-day decision-makinggiven its apparent facility, they do so at their own peril because the rule is not supported by the jurisprudence and is inconsistent withBardal. [23] As such, I conclude that the rule of thumb approach is neither doctrinally sound nor supported by the majority of cases.Accordingly, the trial judge’s rejection of the “one month’s notice per year of service” rule of thumb in this case follows logically fromthe approach required by Bardal and does not signal an error in principle. [24] In sum then, I find that, while right at the high end of the accepted range, the trial judge’s award of six month’s pay in lieu ofnotice is still within the accepted range and was not the product of an overemphasis of or disproportionate weight having been given tothe respondent’s relatively short length of service with the appellant.

In the result, given the standard of review, the award is immunefrom appellate intervention. (

b) Did the trial judge err in awarding $20,000 in aggravated damages? [25] I start by settling on a label for these types of damages. The appropriate label is “moral damages” as this is the label implicitlyadopted by the Supreme Court of Canada in Keays (at para. 59): [3] … [T]here is no reason to retain the distinction between “true aggravated damages” resulting from a separate cause of action and moraldamages resulting from conduct in the manner of termination. Damages attributable to conduct in the manner of dismissal are always tobe awarded under the Hadley principle.

Moreover, in cases where damages are awarded, no extension of the notice period is to be used todetermine the proper amount to be paid. The amount is to be fixed according to the same principles and in the same way as in all othercases dealing with moral damages. [26] Moral damages are generally aggravating in nature and, therefore, appear to take the place of or, more properly, are the same asaggravated damages in the context of wrongful dismissal cases.

In Keays, Bastarache J. noted (at paras. 54-60) that what constitutesmoral damages is informed by the Supreme Court of Canada’s previous decision in Wallace [Wallace v. United Grain Growers Ltd., (SCC), [1997] 3 S.C.R. 701] and that moral damages flow from the principle first articulated in Hadley v.

Baxendale(1854), 156 E.R. 145, 9 Ex. 341 (being that damages for breach of contract are compensable when such damages are in the reasonablecontemplation of the parties at the time the contract was entered into, thus making them reasonably foreseeable in the event of a breach).Damages for hurt feelings or for the normal feelings that accompany a dismissal are not compensable (Keays at para. 59). [27] In the employment context then, moral damages are available whenever the employer breaches the duty of good faith and fairdealing it owes to its employee in the dismissal of its employee (see Wallace, at para. 95).[4] The duty requires employers to be“[c]andid, reasonable, honest, and forthright…” and further requires employers to “[r]efrain from engaging in conduct that is unfair or isin bad faith by being, for example, untruthful, misleading, or unduly insensitive” when dismissing an employee (Wallace, at para. 98).

Ifan employer should run afoul of these requirements, moral damages will likely follow. [28] Here, there can be little dispute that the appellant breached its Wallace duty to the respondent through its actions in the manner ofhis dismissal. The appellant’s reasons for dismissing the respondent were not truthful and were followed by the very serious allegationthat the respondent had been dismissed for fraud, which allegation was not supported by the evidence.

The appellant maintained thatserious allegation until examinations for discovery had taken place following which it dropped the fraud allegation but maintained theallegation of just cause for the respondent’s dismissal. In addition, although the appellant says knowledge of the allegation was restrictedto senior management, a low-level employee of the appellant had been made aware of it and had perpetuated the unfounded allegation toa potential business partner of the respondent. Allegations and actions similar to these have attracted Wallace damages in prior cases (see:Wallace, at para. 99, citing Trask v.

Terra Nova Motors Ltd. (1995), (NL CA), 127 Nfld. & P.E.I.R. 310 (Nfld. C.A.),and Jivrag v. City of Calgary (1986), (AB KB), 45 Alta. L.R. (2d) 343 (Q.B.)). [29] I would, however, pause here to address an evidentiary issue arising in this case, that being whether a plaintiff must adducemedical evidence to prove mental distress. There is conflicting authority on this point.

On one hand, some courts have refused to awardmoral damages in the absence of medical evidence.[5] On the other hand, some courts have awarded damages notwithstanding theabsence of formal medical evidence.[6] Regardless, while evidence such as expert medical reports and itemized expense receipts wouldbe of considerable assistance to a court in determining the quantum of moral damages, it is sensible to hold that medical evidence is notstrictly necessary to prove the existence of mental distress provided there is an adequate factual basis to support an award of moraldamages based on the employer’s conduct (see: Keays, at para. 90, per LeBel J. (Fish J. concurring)).

Therefore, even though therespondent failed to adduce any specific medical reports or the like with respect to the mental distress that he says he has suffered due tothe manner of his dismissal, this does not mean the trial judge was incorrect or erred in concluding that such damages had beenestablished based on other evidence which led to findings of fact which were sufficient to underpin his claim to moral damages.Moreover, the respondent and the respondent’s wife, who is a psychiatric nurse, did testify to the existence of some mental distress. [30] The question then resolves to the appropriate quantum of moral damages in this case.

Like a notice period, the quantum of moraldamages is context-driven. The standard of review is that which the Supreme Court of Canada articulated in Naylor such that deferenceis owed to the trial judge’s findings. Unless the trial judge committed some error in principle, or the amount awarded by the trial judge isinordinately high or low, the appellate court should not interfere with an award. [31] With respect to errors in principle, a thorough review of the trial judge’s analysis here does not reveal any significant error, thisdespite the rather convoluted nature of this area of the law.

The trial judge outlined the relevant authorities, canvassed Keays and theHadley principle, and made the relevant finding of fact necessary for the award. I might quibble that some of the authorities he cited insupport of the $20,000.00 award do not quite align with the facts of this case; however, wrongful dismissal cases are driven by their

specific contexts and case comparisons are, at best, loose comparisons done at a high level.

In other words, not much turns on thisobservation. [32] Although heavily driven by context, a quick canvass of the jurisprudence (albeit primarily from Ontario) indicates a range of$5,000 to $25,000, after extracting the outliers, where a court has awarded moral damages in the general context of an employer makingunfounded allegations against an employee. [7] As such, the instant award of $20,000 falls, again, near the upper end but nonethelesswithin the range of moral damages previously awarded in such circumstances. [33] In sum, I find no error in principle in the trial judge’s analysis and the $20,000 award falls within the range of previous awards insimilar circumstances.

Accordingly, the standard of review augurs against appellate intervention in the award of moral damages in thiscase. (

c) Did the trial judge err in awarding pre-judgment interest? [34] Section 5(1) of The Pre-Judgment Interest Act, S.S. 1984-85-86, c. P-22.2, instructs a court to award interest on a judgment fordamages in accordance with terms of that Act; however, s. 5(3) qualifies this in these terms:

(3) If it is proven to the satisfaction of the court that it is just to do so having regard to the circumstances, the court may, with respectto the whole or any part of the amount for which judgment is given, refuse to award interest under this Act or award interest under thisAct at a rate or for a period, or both, other than a rate or period determined pursuant to

section 6. [35] Considered together, ss. 5(1) and (2) suggest that an award of pre-judgment interest is the default position but that the court retainsa residual discretion “to reduce or eliminate [pre-judgment interest] if circumstances indicate it is just and fair to do so” (see: PetwaCanada Ltd. v. Logan Stevens Construction

(1981) Ltd., [1993] W.W.R. 729 (Sask. C.A.) at para. 3). What then are the parameterswhich bound this residual discretion? [36] In Potash Corp. of Saskatchewan Inc. v. Crown Investment Corp. of Saskatchewan, 2001 SKQB 418, 211 Sask. R. 139, at paras.15-25, Klebuc J. (as he then was) reviewed the law and noted the absence of a controlling authority as to when pre-judgment interestshould be denied.

While this is not the case with which to fill that void, I do propose to consider whether the instant award of pre-judgment interest must be set aside or altered in the two particular circumstances raised by the appellant in this case. [37] To begin, the appellant says that, in as much as the respondent bears the responsibility for prosecuting his claim, any delay in thatprosecution falls largely at his feet and, therefore, he should not benefit from it.

In this respect, the nearly eight years between the filingof the statement of claim and the trial in this case gives rise to a general concern that the respondent might unduly benefit through anaward of pre-judgment interest. In response to this, the respondent says, albeit somewhat contradictorily, there have been no “deadtimes” in his prosecution of this matter and that, while there has been delay, it is not “extraordinary”.

He also says the appellant shouldnot benefit from any delay either. [38] At root, it is logical and consistent with the jurisprudence that, since prosecution of a civil matter is largely the responsibility of theplaintiff, an award of pre-judgment interest to a successful plaintiff should be disallowed or reduced to the extent of any inordinate orunexplained delay in the prosecution of the case (see: Utley v. Schmeichel (1997), (SK KB), 155 Sask. R. 108, and A& L Plumbing & Heating Ltd. v. Ridge Tool Co., 2008 SKQB 77, 313 Sask. R. 19; see also: Jefford v.

Gee, [1970] 2 Q.B. 130 (C.A.), perLord Denning M.R., and Baud Corp., N.V. v. Brook (No. 2), (SCC), [1979] 1 S.C.R. 677). This is consistent with ThePre-judgment Interest Act in that it encourages promptness in payment by a defendant and permits a court to penalize a plaintiff for delayin prosecuting a claim by denying pre-judgment interest. Put simply, a plaintiff should not be allowed to treat a claim like a savingsaccount idly drawing interest as long as it wishes: Rayani v. Yule & Co. (Hong Kong) Ltd., 1996 ABCA 35 , [1996] 3 W.W.R.574 (Alta.

C.A.). [39] From my review of the record, there is no adequate explanation for the delay in advancing this matter between, generally, 2004and 2007 (when the pre-trial occurred) and then again between 2007 and 2009. I see no reason why this matter, which is a fairlystraightforward wrongful dismissal and moral damages claim, could not have been brought to trial in at least half the time, i.e., in underfour years. [40] The respondent suggested in oral argument that the delay resulted from his impecuniosity.

The fact that inordinate delay hasresulted from a plaintiff’s impecuniosity generally could not, even in the best of circumstances, render just that which is otherwiseunjust. Moreover, given the evidence before the Court of the respondent’s significant earnings during the periods of delay in question,such a submission is wholly untenable here. As such, in that the delay in this case is inordinate and has not been adequately explained bythe respondent, the consequences of it must lie at his feet. As to the extent of that, practicality must intervene.

If the respondent’sdamages were significant, then it might be worth the time and effort of conducting an exact accounting (see: Rayani v. Yule & Co., atpara. 30); however, given the amount at stake, an in-depth analysis would be “grossly uneconomical” in the circumstances.

Accordingly,using a rough measure, I would simply reduce the overall award of pre-judgment interest by fifty per cent (50%) on account of therespondent’s delay in prosecuting his case against the appellant. [41] As to the second issue, the appellant says the trial judge erred by awarding pre-judgment interest on the $20,000 moral damagesaward, which interest was to be calculated from and after January 1, 2003. The appellant says, that s. 5(2)(

d) of The Pre-JudgmentInterest Act, which prohibits an award of pre-judgment interest on “exemplary or punitive damages”, applies in the context of an awardof moral damages (or “aggravated damages”, to use the old name) in a wrongful dismissal action. Certainly, trial-level jurisprudencedoes show some confusion between what were once called “aggravated damages” and what are known as “exemplary or punitivedamages”, but this uncertainty has been put to rest by the majority decision in Keays (see also: Fidler v. Sun Life Assurance Co. ofCanada, 2006 SCC 30, [2006] 2 S.C.R. 3, Whiten v.

Pilot Insurance Co., 2002 SCC 18, [2002] 1 S.C.R. 595, Hill v. Church ofScientology, (SCC), [1995] 2 S.C.R. 1130; and Vorvis v. Insurance Corporation of British Columbia, (SCC), [1989] 1 S.C.R. 1085). In Keays, Bastarache J., for the majority, said: [59] To be perfectly clear, I will conclude this analysis of our jurisprudence by saying that there is no reason to retain the distinction

between “true aggravated damages” resulting from a separate cause of action and moral damages resulting from conduct in the manner oftermination. Damages attributable to conduct in the manner of dismissal are always to be awarded under the Hadley principle. Moreover,in cases where damages are awarded, no extension of the notice period is to be used to determine the proper amount to be paid. Theamount is to be fixed according to the same principles and in the same way as in all other cases dealing with moral damages.

Thus, if theemployee can prove that the manner of dismissal caused mental distress that was in the contemplation of the parties, those damages willbe awarded not through an arbitrary extension of the notice period, but through an award that reflects the actual damages.

Examples ofconduct in dismissal resulting in compensable damages are attacking the employee’s reputation by declarations made at the time ofdismissal, misrepresentation regarding the reason for the decision, or dismissal meant to deprive the employee of a pension benefit orother right, permanent status for instance (see also the examples in Wallace, at paras. 99-100). [60] In light of the above discussion, the confusion between damages for conduct in dismissal and punitive damages is unsurprising,given that both have to do with conduct at the time of dismissal.

It is important to emphasize here that the fundamental nature ofdamages for conduct in dismissal must be retained. This means that the award of damages for psychological injury in this context is stillintended to be compensatory. The Court must avoid the pitfall of double-compensation or double-punishment that has been exemplifiedby this case. [42] In addition, in Ontario, where s. 128(3) of the Courts of Justice Act mirrors s. 5(2)(

d) of our Pre-Judgment Interest Act, the court inDownham v. Lennox & Addington (County) (2005), (ON SC), 56 C.C.E.L. (3d) 112 (Ont. Sup. Ct.) held that theprovision did not apply to Wallace damages because such damages are compensatory in nature. This decision highlights the fact that theprinciples which underpin the statutory bar under s. 5(2)(

d) just do not support a bar on pre-judgment interest on moral damages. [43] The argument for barring interest on exemplary or punitive damages is that such damages are imposed as a penalty rather than ascompensation for a loss. In other words, the recipient of an award of exemplary or punitive damages has not forgone the use of thatmoney in the time between the claim arising and the award of damages at trial. For this reason, an award of pre-judgment interest onexemplary or punitive damages is unnecessary as it would not serve to compensate a successful plaintiff for any loss of the use of money.

The argument is described in these terms in S.M. Waddams, The Law of Damages, 2nd ed., loose-leaf edition (Canada Law Book:Toronto), at para. 7.980: … It cannot be said that the defendant should have paid promptly – the damages become payable only upon the decision of the court,which acts in respect of exemplary damages like a criminal court. The damages are not payable by way of recompense but as apunishment, and the punishment cannot occur until the decision of the court that imposes it. The amount assessed as exemplary damagesis the amount then thought to be proper to be paid at that time.

Another point concerns inflation. Exemplary damages, being assessed atthe time of the hearing, will reflect the punishment thought appropriate in terms of money at that time. Had the hearing been held at thedate of the wrong a smaller nominal sum would presumably have been thought appropriate, reflecting the higher value of money at thattime.

It would be wrong, therefore, for the defendant to have to pay exemplary damages measured in inflated dollars, together withinterest at rates that themselves reflect inflation between the date of the wrong and the date of the judgment. [44] While there may be some ostensible merit to an argument that, because moral damages are assessed and awarded at the time oftrial, they presumably already reflect the effluxion of time between the date of the wrong and the date of assessment, the jurisprudencedoes not bear this out.

Pre-Keays, when awards of this nature took the name “Wallace damages”, such damages were awarded throughenhancement of the notice period and the courts did not later lop off the enhancement when calculating an award of pre-judgmentinterest, although it would have been easy to do so. Pre-Wallace, awards of aggravated damages also attracted pre-judgment interest (see:Norberg v. Wynrib, (SCC), [1992] 2 S.C.R. 318).

While Keays expressly rationalised Wallace damages, aggravateddamages and moral damages under the single head of “moral damages”, the Supreme Court of Canada said nothing about the effect, ifany, this might have on the applicability of pre-judgment interest to such awards; but it did not need to since there was no reason thepractice of awarding pre-judgment interest on awards of such damages would not continue.

I would, therefore, not interfere with theaward of pre-judgment interest in respect of the moral damages awarded in this case. [45] On the whole of it then, I find the overall award of pre-judgment interest to be unjust in the circumstances. I would set it aside andsubstitute a reduced award equal to fifty per cent (50%) of the pre-judgment interest calculated on the amounts awarded for pay in lieu ofnotice, for loss of vehicle benefit and moral damages. IV. Conclusion [46] In

summary, given the standard of review, even though the awards of pay in lieu of notice and moral damages here are, in myopinion, at the high end of the ranges of reasonable awards, the trial judge did not err in principle and neither award otherwise invitesappellate intervention. The award of pre-judgment interest, however, does merit appellate intervention as it is unjust in thecircumstances.

I would, therefore, allow the appeal with respect to the award of pre-judgment interest, but dismiss it in all other respects. [47] As the appellant has had mixed success in this appeal, I would make no order as to costs in this Court, which includes the partiesappearance in Chambers on January 11, 2012. DATED at the City of Regina, in the Province of Saskatchewan, this 22nd of July, A.D. 2013.

“Caldwell J.A.” _____________________ Caldwell J.A. I concur “Richards C.J.S.” ___________________ Richards C.J.S. I concur “Lane J.A.” ________________________ Lane J.A. [2] See: Barry B. Fisher, “Revisiting Reasonable Notice Periods in Wrongful Dismissal Cases 2006 Edition” (2006) online: http://www.barryfisher.ca/papers/Revisiting_Reasonable_Notice.pdf , Barry B. Fisher, “Measuring the Rule of Thumb in Wrongful Dismissal Cases” online: http://www.barryfisher.ca/papers/Rule_of_Thumb.pdf , David Harris, Wrongful Dismissal , at 4-18, and the Honourable Mr. Justice John R.

Sproat, Wrongful Dismissal Handbook , (Toronto, ON: Carswell, 2009) at 6-4.9. [3] See also: Natalie C. MacDonald, Extraordinary Damages in Canadian Employment Law , (Toronto, ON: Carswell, 2010), and The Honourable Mr. Justice Randall Scott Echlin & Christine M. Thomlinson, For Better or For Worse: A Practical Guide to Canadian Employment Law , (Aurora, ON: Canada Law Book, 2011) at 254.

The passage from Keays is more extensively quoted at para. 41 herein. [4] Per Iacobucci J., for the majority: “… In my opinion, to ensure that employees receive adequate protection, employers ought to be held to an obligation of good faith and fair dealing in the manger of dismissal, the breach of which will be compensated for by adding to the length of the notice period.”