[1] Donald Marlowe was employed by Ashland Canada Inc. to sell automotive products in British Columbia from September 14, 1994 to December 11, 1998 when his employment was terminated for cause. Mr. Marlowe, who is self-represented, commenced this action for wrongful dismissal and breach of contract on April 23, 1999. In its statement of defence filed June 4, 1999 Ashland admitted it did not have cause for the termination.

[2] In relation to the wrongful dismissal, Mr. Marlowe claims salary and bonus in respect of a reasonable notice period of 4.5 months and such extension thereof as the court considers justified having regard for the conduct of Ashland in the course of the termination. He claims damages for loss of use of a corporate vehicle and the employer's Canada Pension Plan and employee savings plan contributions in respect of the notice period.

[3] Ashland admits that the reasonable notice period was 4.5 months but says there is no justification for an extension of the notice period. Ashland says Mr. Marlowe is entitled to base salary but not bonus during the notice period. Ashland admits it is obliged to pay an amount to the Canada Pension Plan on behalf of Mr. Marlowe. The company denies that any damages are payable in respect of the loss of the use of a corporate automobile in the notice period and denies any obligation to pay an amount to the employee savings plan on behalf of Mr. Marlowe.

[4] Mr. Marlowe also claims damages for other breaches of his employment contract. He claims he is entitled to additional commissions for the 1994 through 1997 fiscal years. He claims he was not properly compensated for the fiscal year ending September 30, 1998, or for the period from October 1, 1998 to the date of his dismissal. He claims Ashland has refused to provide an accurate and reasonable reference on his behalf and has inappropriately portrayed the circumstances of his dismissal. In addition to damages for these breaches of contract, Mr. Marlowe claims exemplary, punitive or aggravated damages as a consequence of Ashland's conduct towards him in relation to these matters and the termination of his employment.

[5] In response, Ashland says Mr. Marlowe has been paid all he has earned under the terms of his employment contract. Ashland says nothing in its conduct toward Mr. Marlowe justifies an award of exemplary, punitive or aggravated damages.

[6] Ashland is a wholly owned subsidiary of Ashland Inc., a United States corporation. One of Ashland's divisions operates under the name of "Valvoline Canada". The division markets automotive products of various kinds.

[7] The Valvoline business is divided into divisions, districts and territories across Canada. From 1994 until his termination, Mr. Marlowe was a territory manager of whom there were 17 in Canada in the fall of 1998. In that capacity, Mr. Marlowe was responsible for the sale of products to independent automotive dealers and outlets in his territory. He also dealt with organizations that purchased product for distribution to their members. These were referred to in the evidence as UAP/NAPA, Lordco, Cummins, Uni-Select and Canadian Brake.

[8] Mr. Marlowe reported to Mr. Brad Reid, the division manager for western Canada, until the spring of 1998 when Reid left the employ of Ashland. Mr. Mark Coxhead, the Valvoline Canada national sales manager from and after 1997, testified that he had no one to replace Reid. Mr. Coxhead assumed Reid's duties until mid-August 1998. Mr. Marlowe reported to Mr. Coxhead in that period of approximately three months.

[9] In mid-August, following a reorganization of reporting relationships, Mr. Scott Demay was appointed district manager for British Columbia. Mr. Marlowe reported to Demay from mid-August 1998 to his dismissal in December. Demay, in turn, reported to Mr. Jeremy Brookes who was in charge of the Valvoline Canada central district comprised of Ontario and Atlantic Canada. Brookes reported to Mr. Coxhead.

[10] Mr. Coxhead had a telephone meeting with Mr. Marlowe on October 15, 1998. Mr. Coxhead summarized the discussion in the following memorandum:

• UAP pricing/trade show, any discounts must have prior written approval, you did not have approval for all of the discounts that were offered. Secondly we do not promote private label at any time in our trade show booth(s).

• Car expenses, you recently claimed $400 for service on a company car that is ready to be replaced. Expense claims for service exceeding $200 must have prior approval as per the SPI and the notes sent to you in February '98 and October 1998.

• Spousal travel, any such travel must have prior authorization from the President, as per the SPI.

• Indy suite ticket purchase, for the Friday.

• Cellular phone charges, must be managed and are not to exceed published limits.

• Removing of product/inventory from the warehouse, before any items are taken work orders must be completed.

• Traffic fines (photoradar), please make payment upon receipt of your copy.

• Reviewed policies in regards to minimum orders, discounts, etc. as forwarded by hard copy.

• B.C. District sales manager, Scott Demay.

[11] The memorandum and the evidence regarding the "serious issues" identified therein provide insight into Mr. Coxhead's attitude and conduct toward Mr. Marlowe.

[12] With respect to the UAP pricing issue, Mr. Marlowe testified that he made a "cold" call to a UAP distributor in Burns Lake, B.C., part of his territory. Mr. Marlowe and the distributor discussed volumes and prices. The distributor advised of his willingness to purchase certain volumes of product at a price that was less than the UAP price to the distributor. Mr. Marlowe testified that he agreed to attempt to obtain approval of the pricing proposed by the distributor.

[13] A purchase order was signed by the distributor stipulating the volumes and prices at which he was prepared to purchase. Mr. Marlowe sent the documentation to Ashland's head office for approval as required by Valvoline Canada's Standard Practice Instructions ("SPI"). The product was shipped from Ontario and billed to the distributor without the pricing having been approved.

[14] Mr. Marlowe testified it was possible he sent a copy of the purchase order to the shipping department when he sent the same material to head office for pricing approval. There is insufficient evidence from which to conclude he did, in fact, do so.

[15] Mr. Coxhead testified to his interpretation of the discussions between Mr. Marlowe and the distributor. His view was that Mr. Marlowe offered the distributor the prices specified in the purchase order and that Mr. Marlowe was attempting to force a special arrangement with the Burns Lake distributor through the company's system in disregard of the SPI. Mr. Coxhead offered no explanation for the fact that the operations side of the company had shipped the product without pricing approval.

[16] I accept Mr. Marlowe's evidence in relation to this transaction and reject that of Mr. Coxhead. Mr. Marlowe was the one who dealt with the distributor. Mr. Coxhead had no personal knowledge of the transaction or the discussions. He could not identify any documentation tending to support his perception of the transaction. His evidence on this issue is nothing more than speculation on his part. I reject his evidence as a result.

[17] I find as a fact that Mr. Marlowe complied with the SPI by submitting a conditional purchase order obtained from a potential customer to Ashland's head office for approval. I find that Mr. Marlowe did not attempt to circumvent the company's pricing procedures.

[18] The issues with respect to pricing and private label promotion to which Mr. Coxhead referred in the memorandum arose at a UAP-sponsored trade show in early October 1998. Valvoline had a display booth at the show. Mr. Marlowe was in charge of the display. He testified he was required to submit product prices to UAP before the show. He submitted his proposed prices to Mr. Coxhead who approved them and suggested discount pricing for one-litre containers of product. He did not specify the amount of discount. Mr. Marlowe tried to reach Mr. Coxhead by telephone to discuss the discount but was unable to do so. He incorporated a small discount on that product in the list he submitted to UAP. The discounted price was offered at the show. He subsequently advised Mr. Coxhead of his action.

[19] Mr. Marlowe acknowledged that five one-litre containers of UAP private or branded label product were displayed at the same trade show. He testified that up to the time of that event it was customary, in the B.C. district, to display small amounts of private label product at trade shows in which Valvoline was involved. He had done so in conjunction with district manager Reid at a Uni-Select show.

[20] Mr. Coxhead testified that pricing proposals for the UAP show had been sent to him and approved. He had no recollection of saying anything about the possibility of providing discounts on one-litre containers of product.

[21] Mr. Coxhead testified that it was against company policy to display private label products at any trade show. He testified that he had seen private label product displayed by Mr. Marlowe at an earlier Uni-Select trade show staffed by Mr. Marlowe and Mr. Reid. He removed the product from that show. He told Messrs. Marlowe and Reid such product was not to be displayed. The date of the Uni-Select show was not identified in the evidence.

[22] Mr. Coxhead testified that he did not attend the UAP show but Mr. Demay advised him that private label product had been displayed. Mr. Demay, to whom Mr. Marlowe reported at the time, must have been aware of the display. There is no evidence that he thought it was improper or that he did anything to remove it. Mr. Coxhead advised or warned Mr. Demay such displays should not occur in the future.

[23] With respect to the UAP pricing issue, I prefer the evidence of Mr. Marlowe to that of Mr. Coxhead. I find as a fact that Mr. Coxhead suggested discount pricing for one-litre containers. I find that Mr. Marlowe attempted to discuss the amount of a discount with Mr. Coxhead. I find that he believed he was acting in the best interests of the company with sufficient approval in the circumstances of the UAP trade show when he offered discounts on an item for which earlier written approval had not been given. I was not directed to any direction in the SPI indicating that trade-show pricing had to be approved in writing.

[24] I accept Mr. Coxhead's evidence that the national policy was to refrain from displaying private label product at trade shows. I find, however, that at the time of the UAP show it was accepted practice in British Columbia to display private label product at trade shows sponsored by customers for whom Ashland packaged private label or branded products.

[25] The circumstances surrounding Mr. Coxhead's criticism of the expenditure of $400 on brake repairs without prior approval are straight-forward. Mr. Marlowe testified that on the occasion of the Molson Indy race in Vancouver in the summer of 1998, Mr. Michael D'Ilario, a senior employee in the Valvoline organization, drove Mr. Marlowe's leased vehicle. D'Ilario spoke to Mr. Marlowe about a noise or problem he had detected with the brakes. D'Ilario told him to have the brakes checked. Mr. Marlowe did so. The service inspection indicated that the brakes required replacement. Mr. Marlowe had the work done as a result. He claimed the expense on his expense account.

[26] Mr. Coxhead testified that no work to a cost in excess of $200 was to be performed on a leased vehicle without prior approval except in emergency circumstances. He expressed concern that any expenditure had been incurred in this case because the lease term on the vehicle was soon to expire. He did not know, however, when or on what terms the lease might have been terminated.

[27] The SPI does not specify that written rather than oral approval was required for this expenditure. I accept Mr. Marlowe's evidence that he construed his discussion with D'Ilario to be a direction and approval to do what had to be done with respect to the repair of the brakes on the vehicle. I find he had the necessary approval to proceed as he did.

[28] In any event, Mr. Marlowe's actions were entirely responsible and reasonable and did not contravene the SPI. Common sense says it would be unsafe to drive a vehicle with poor brakes. In another context, to which I will come presently, Mr. Coxhead testified that matters of safety were of paramount importance because Ashland was self-insured. Little can be more important to safety than working brakes on an automobile. Advice from a service technician that brakes should be replaced should reasonably be construed as giving rise to an emergency situation within the meaning of the SPI so that repairs could be made without approval of any kind.

[29] On the issue of brake repairs, I observe that Mr. Coxhead never suggested Mr. Marlowe should pay the cost of repair in excess of $200 as the SPI would have permitted him to do.

[30] The evidence with respect to spousal travel is that Mr. Marlowe took his spouse and children with him on a single occasion when he was travelling to Vancouver Island on business. He admitted he did not have prior authorization from the president. His explanation was that he did not think prior approval was required by the SPI. Mr. Marlowe had not charged any expense in respect of the travel of his family members to the company.

[31] Mr. Coxhead testified that the reason for the policy with respect to spousal travel was to guard against corporate exposure to liability under their self-insured plan. Mr. Coxhead's evidence on this point is not convincing.

[32] I was directed to nothing in the SPI indicating that the purpose of the spousal travel approval requirement was to protect against liability. The indications are to the contrary.

[33] The question of family travel is addressed in the SPI under the heading of "Expense Reporting". The general introduction to the section specifies that necessary and reasonable travel, entertainment and other expenses lawfully incurred while on company business would be reimbursed provided they were properly reported and approved. The same introduction stipulates that family travel in combination with business travel, must be approved by the president. The SPI stipulates that incremental travel expenses associated with spousal travel were to be separately identified in an employee's expense report.

[34] The reasonable inference is that if the cost of family travel was to be reimbursed, the travel must have been approved and the costs must have been reasonable. In my opinion, prior approval was not required for family travel by the SPI if no expense was to be charged to the company. As I have noted, Mr. Marlowe made no separate claim for family travel expenses. There is no evidence that any of the expenses he did claim pertained to family travel. Mr. Marlowe did not act in contravention of the SPI.

[35] I am not prepared to accept that Mr. Coxhead was concerned about liability and safety in relation to unauthorized family travel when he was not prepared to regard unsafe brakes on a leased vehicle as a safety issue giving rise to an emergency so as to justify immediate repair without approval.

[36] In his memorandum, Mr. Coxhead criticized Mr. Marlowe for the purchase of a ticket to the company's Molson Indy suite.

[37] Mr. Marlowe testified that he purchased the ticket because a customer in his territory for whom a single ticket was available appeared at the Molson Indy accompanied by his son. Mr. Marlowe decided to purchase another ticket in order that the customer's son would not be restricted to a thirty- minute entry by means of a temporary ticket.

[38] Mr. Marlowe claimed reimbursement of the $75 expense. The claim was paid.

[39] Mr. Coxhead testified that his concern was that this kind of expenditure might cause the company to exceed its hospitality budget for the Molson Indy.

[40] The evidence of Mr. Coxhead in relation to this matter causes me to be concerned about the general reliability of his evidence and his professed concern for protocol as portrayed in the October 15^th memorandum. On his examination for discovery, Mr. Coxhead testified that wristband identification was required to gain entry to the hospitality suite. He admitted that the company engaged in the practice of removing wristbands from those in the suite in order to permit others to gain entry without the purchase of additional tickets.

[41] At trial Mr. Coxhead testified that he had confused the wristbands, which should not be exchanged, with other documentation that could be exchanged in order to allow limited access to the race car pit area.

[42] I do not accept the explanation. The questions and answers at the examination for discovery were clear. Mr. Coxhead did not then qualify his knowledge in any way. He did not advise anyone, until he testified at the trial, that his answers were incorrect. Because of Mr. Coxhead's evidence surrounding the improper admission of persons to the hospitality suite and his late attempt to revise his discovery testimony, I am generally sceptical of his evidence in areas that lack circumstantial support.

[43] A further criticism of Mr. Marlowe identified in the memorandum related to the use of a cellular phone. Mr. Coxhead told Mr. Marlowe that charges were not to exceed limits published in the SPI. The evidence on this point is that no limits on use were specified in the SPT. Rather, there was a limit on reimbursement and directions regarding the manner in which excesses would be paid.

[44] Mr. Marlowe's cellular account was directed to head office in Ontario. The SPI stipulated that the company would absorb cell charges to the level of $125 monthly. Any excess was to be charged back to the employee on the next expense account submitted for payment.

[45] Mr. Coxhead admitted that while his memorandum makes reference to a limit there was none in fact. He testified as well that he had no knowledge of the company ever refusing to pay Mr. Marlowe's cell charges in excess of $125 monthly.

[46] In the circumstances I cannot comprehend how any manager could regard cell phone use in excess of reimbursable amounts as a "serious issue".

[47] The memorandum referred to the fact that products were not to be removed from the warehouse without a work order. Mr. Marlowe's evidence was that he removed product with the warehouse manager's knowledge and consent for use at a trade show. Technically he contravened company policy. There is no evidence of any contravention on more than one occasion.

[48] Finally, the memorandum refers to the fact that Mr. Marlowe had not paid a photo-radar traffic fine. The evidence with respect to this complaint is that the fleet lessor billed Ashland's head office for lease charges, including ticket violations that had been sent to the lessor as the registered owner of the vehicle. Some time after receipt, notices of traffic violations were sent by head office to the employee to whom the leased vehicle was assigned.

[49] The evidence with respect to the ticket pertaining to a violation on June 15, 1998 is in an unsatisfactory state. Following the October 15^th meeting, Mr. Marlowe wrote to Mr. Coxhead to advise that "the photo radar fine will be paid upon receipt". Mr. Marlowe testified that he did not receive a copy of the photo radar ticket to which Mr. Coxhead referred in his memorandum until some few weeks before the trial, and then only in response to an information request at the Coxhead examination for discovery.

[50] Mr. Coxhead's evidence is that when he was in Vancouver on business, he had occasion to use Mr. Marlowe's desk. When he took the liberty of looking through the drawers of Mr. Marlowe's desk for writing paper, he located a photo-radar ticket. At trial he testified that he recognized the vehicle as that operated by Mr. Marlowe in 1998. At his examination for discovery, Mr. Coxhead had testified that he did not know what vehicle was depicted on the ticket as he had never seen it. This contradiction was not explained in the course of his evidence.

[51] Mr. Marlowe's evidence was that the ticket in his drawer pertained to a violation that he committed with another vehicle in 1995 or 1996. I accept that evidence and do not accept Mr. Coxhead's evidence that he found a 1998 photo-radar ticket in Mr. Marlowe's desk.

[52] Regardless of the circumstances surrounding the photo-radar ticket there is no evidence from which one could conclude that Mr. Marlowe negligently or deliberately refrained from remitting the balance owing on the amount of any ticket to the lessor, the company, or the Province of British Columbia so as to give rise to any "serious issue" in relation to Mr. Marlowe's employment.

[53] The reference in Mr. Coxhead's memorandum to the review of policies with regard to minimum orders was directed to the fact that product had been shipped in smaller loads than specified by the company's national policy. I find on the evidence that the small shipment practice had been approved for use in British Columbia. There is no evidence of a satisfactory nature that would suggest Mr. Marlowe acted in contravention of the policy as it was pursued in British Columbia.

[54] Finally, the reference in the October 15^th memorandum to the fact that Mr. Demay was the B.C. District Sales Manager was Mr. Coxhead's method of confirming with Mr. Marlowe that he was to report to Mr. Demay who had been appointed district manager in preference to Mr. Marlowe.

1998 Performance Review

[55] The meeting and memorandum of October 15, 1998 were followed by a performance review for the company's fiscal year ending September 30, 1998. On November 23, 1998, Mr. Coxhead completed the review of Mr. Marlowe's performance in accordance with the company's standard procedures. Mr. Marlowe's entitlement to a bonus was partially dependent on the results of the review.

[56] The review identified six individual performance goals. On a scale of one to seven, the latter being the worst possible grade, Mr. Coxhead assessed Mr. Marlowe at a level of four in two categories and six, in four others. Mr. Coxhead gave Mr. Marlowe an overall rating of seven. None of the other 16 territory managers across Canada was assessed at a level of seven or six. Mr. Coxhead testified that no one was rated at level one, a single individual may have been rated at level two, and all others were rated from three to five. All territory managers except Mr. Marlowe received a bonus for the 1998 fiscal year.

[57] The performance review for the 1998 fiscal year is instructive and of great importance in this case.

[58] The performance review required Mr. Marlowe to describe the goals set for him by management and compare fiscal year end results to the objective. Mr. Coxhead, as the assessor of Mr. Marlowe's performance, was required to provide his comments and rate Mr. Marlowe's performance. The possible ratings as defined by the company are the following:

1 EXCEPTIONALLY EFFECTIVE. Performs beyond requirements in all major accountabilities. This performance category is reserved for those individuals whose demonstrable contributions During the period of review are clearly outstanding, especially in performing the most difficult and challenging aspects of the job.

2 [no description]

3 VERY EFFECTIVE. Performance is consistently effective and there are no weaknesses in carrying out the major accountabilities of the job.

4 [no description]

5 EFFECTIVE. Performance is what is expected of a fully qualified and experienced person in the position. Major accountabilities are performed in an acceptable fashion.

0 TOO NEW TO EVALUATE. Less than six months experience.

Marginal Performance

6 Performs most accountabilities in an acceptable fashion but is noticeably below the level in some major areas. If similar work effectiveness existed throughout your unit, some important work goals would not be met. Performance improvement is necessary to satisfy the full requirements of the job.

Unacceptable Performance

7 Performance on most major accountabilities is inadequate and fails to meet the minimum requirements of the job. Has been on the job long enough to have shown better performance. Change must be made or major work goals will not be accomplished.

[59] The absence of a description for ratings 2 and 4 suggests they are in the discretion of the manager but intended to fall within the mid-range of ratings 1 and 3 and 3 and 5, respectively.

[60] In respect of two individual goals stipulated for Mr. Marlowe, sales volumes and revenue for 1997 and 1998 were material. The performance review indicates discrepancies between Mr. Coxhead's information with respect to volumes and revenues compared to that possessed by Mr. Marlowe. No effort was made by Mr. Coxhead to resolve the discrepancies in consultation with Mr. Marlowe although the discrepancies are readily observed, significant and highly relevant to rating.

[61] Whatever numbers are relied upon, Mr. Marlowe exceeded the individual sales goals that had been set for him for the 1998 fiscal year. Indeed, he had consistently achieved or exceeded the goals set for him in prior years. From the commencement of his employment in 1994 to the end of fiscal 1998, he had increased sales in his territory by somewhat just less than 500%.

[62] In each of the categories concerned with volumes and sales, Mr. Marlowe rated himself at level four. Mr. Coxhead adopted that rating.

[63] Another of the goals set for Mr. Marlowe was to increase Uni-Select sales by 18,000 litres, UAP sales by 13,000 litres and sales to independents by 46,000 litres in fiscal 1998. The information available to Mr. Marlowe indicated he increased Uni-Select sales by more than 20,000 litres, UAP sales by more than 100,000 litres and sales to independents by more than 30,000 litres.

[64] In assessing Mr. Marlowe's performance in relation to this goal at a rating of six, Mr. Coxhead proceeded on the basis that 1997 sales to Uni-Select, UAP and the independents, totalled 787,000 litres. The 1997 volume of 787,000 litres was different from the volume of 760,562 litres that Mr. Coxhead set forth in a memorandum of November 11, 1997, describing Mr. Marlowe's territory objectives.

[65] Against the 1997 base, in respect of which there was an internal contradiction that should have been known to and identified by Mr. Coxhead, Mr. Coxhead recorded year-end results at approximately 656,384 litres. That number is substantially different from sales of 887,039 litres attributed to Mr. Marlowe by Mr. Coxhead in relation to another goal for which a rating of 4 was provided.

[66] In his evidence, Mr. Coxhead admitted the comparison of required sales of 787,000 litres to recorded sales of 656,384 was an error and made his rating unfair.

[67] Another portion of the performance review required the employee to stipulate two developmental objectives for the fiscal year. Mr. Marlowe did that. Mr. Coxhead's view was that no one had set measurable goals for Mr. Marlowe for the 1998 fiscal year. He made no assessment of developmental objectives as a result.

[68] The final portion of the performance review required Mr. Coxhead to provide an overall individual performance rating. The direction to the manager in that regard is the following:

In response to that straightforward direction, Mr. Coxhead provided Mr. Marlowe a rating of 7.

[69] Mr. Coxhead's evidence was that he was entitled to take into account matters other than the ratings provided in respect of individual goals and developmental objectives. If that was his view, there was no justification for it given the clear direction in the performance review material.

[70] There was no basis for the award of the lowest possible rating of seven because of unacceptable performance given the performance review completed by Mr. Coxhead. That rating is reserved for situations where performance "on most major accountabilities is inadequate and fails to meet the minimum requirements of the job and the employee has been on the job long enough to have shown better performance". Mr. Marlowe did not fail to meet the minimum requirement in any category, let alone most categories in 1998 or any year of his employment.

[71] In the area of the performance rating reserved for the manager's comments, Mr. Coxhead wrote as follows:

[72] Mr. Coxhead testified that Mr. Marlowe spoke in a rude and vulgar manner to him and to others of his superiors. He said that was the reason for his notation regarding combative and aggressive behaviour.

[73] I do not accept Mr. Coxhead's evidence in this regard. Nowhere in any of the documentation presented at trial is there any record of insubordination or disrespectful language used by Mr. Marlowe in his discussions with others. I cannot imagine that Mr. Coxhead would have omitted to record such occurrences in writing given the minutiae in respect of which he recorded unfounded complaints in his memorandum of October 15, 1998.

[74] The 1998 performance review is replete with error and inconsistency. It expresses a conclusion that is not authorized by the directions to management contained in it.

[75] I find as a fact that Mr. Coxhead provided an unwarranted and undeserved rating of seven intending to deprive Mr. Marlowe of participation in the bonus plan for the fiscal year ending 1998. I reject Mr. Coxhead's evidence to the contrary. In the ordinary course, one intends the consequences of one's actions. There is no reason to reach any other conclusion in this case when Mr. Coxhead recorded that Mr. Marlowe had failed in most major accountabilities, having failed, in fact, in none.

[76] I find Mr. Coxhead was fully aware of the effect his valuation, based on inaccurate and inconsistent information and a subjective interpretation that was irrelevant to the overall assessment, would have on Mr. Marlowe's economic fortunes.

[77] In relation to the manager's closing comments in the performance review, I observe that there was no record of alleged incidents of failure to comply with company policies except as enumerated in the October 15^th memorandum. I have previously stated that with the single exception of the removal of product from a warehouse on an isolated occasion for use in a trade show, Mr. Marlowe did not violate operating procedures.

[78] I find that if Mr. Marlowe's performance had been fairly assessed, his performance would have been rated at a level of four. I find that Mr. Coxhead's conduct in relation to the 1998 performance review as evidenced by the contents of the memorandum and the performance review itself was harsh, vindictive, malicious and reprehensible.

[79] On December 11, 1998, Mr. Brookes wrote as follows to advise Mr. Marlowe of his termination:

[80] The letter refers to a discussion of issues that resulted in the unacceptable performance rating of seven. The only issues identified in the evidence were those outlined in the October 15, 1998 memorandum and the 1998 performance review.

[81] It is apparent that the company's view was that the issues raised in that memorandum constituted cause for dismissal. I have found that the complaints, other than that in respect of the removal of product from a warehouse for trade show purposes without a work order, were unfounded. That violation did not create cause for dismissal.

[82] The dismissal letter refers to a pricing problem with Qualicum Auto not mentioned in the October 15^th memorandum. The evidence satisfies me that there was, in fact, no difficulty in relation to the Qualicum Auto account and the reference to that account was an error. Mr. Brookes was not called to testify to any concern in relation to dealings with any other customer.

[83] The Brookes letter makes reference to the Burns Lake pricing problem. There is no evidence whatever that Mr. Brookes knew of the circumstances surrounding that transaction. I infer that any information Mr. Brookes received in that regard was derived from Mr. Coxhead.

[84] The evidence indicates that the substantive complaint in relation to Mr. Marlowe's employment was that he did not accept the appointment of Mr. Demay, rather than himself, as district manager for British Columbia and the working relationship between them was strained. The company's view was that Mr. Marlowe was the source of the strain. Ashland chose to terminate his employment as a result. That it was entitled to do on reasonable notice.

[85] Following his dismissal, Mr. Marlowe asked for a letter of reference from Ashland. He drafted a letter for consideration by the company. The company found the text unacceptable.

[86] Rather than adhering to its position that it would not provide a letter of reference as it could have done, the company provided Mr. Marlowe a letter confirming the commencement date of his employment, the position held and the responsibility assigned to him. In my opinion, that letter was not a reference letter of any kind.

[87] After his dismissal, Mr. Marlowe sought replacement employment. He obtained an offer from a company called Faucher Industries Ltd. The offer was conditional upon Faucher receiving a favourable employment reference. Mr. Marlowe invited Faucher to call Mr. Brookes. A Faucher representative did so.

[88] I accept Mr. Marlowe's evidence that he had a follow-up call with Faucher in which the Faucher representative raised topics addressed by Mr. Coxhead in the memorandum of October 15, 1998. Mr. Marlowe had not discussed any of the matters with Faucher previously. The representative told Mr. Marlowe that the offer of employment was withdrawn because the condition had not been satisfied.

[89] From this evidence, I infer that Faucher derived its information in relation to the matters addressed in the October 15^th memorandum from the discussion with Brookes. There is no other explanation for Faucher's knowledge of the subjects referred to therein.

[90] Although he did not get the job with Faucher, Mr. Marlowe found employment commencing February 1, 1999 at less compensation than he would have received at Faucher.

[91] Mr. Marlowe claims that the commission plan for territory managers in the fiscal year ending September 30, 1996 entitled him to a bonus determined by reference to the increase of sales for any month in the 1996 fiscal year over sales for the same month in the 1995 fiscal year.

[92] Mr. Marlowe testified that in early November 1995 the program was unilaterally changed to adversely affect him but not to affect other managers. The change related to the method of determining increases in sales. If made, the change would reduce the amount of commission Mr. Marlowe was to earn.

[93] The evidence does not satisfy me, on the balance of probabilities, that the change was made in the manner described by Mr. Marlowe. It is possible that the evidentiary deficiency in this regard results from the fact that Mr. Marlowe chose to represent himself in respect of this particularly difficult topic.

[94] In any event, I am satisfied that if there was a change, Mr. Marlowe acquiesced to it and continued his employment in conformity with it. It follows that the claim for commission computed by reference to any formula other than that applied in the 1997 fiscal year is dismissed.

[95] Mr. Marlowe claims that Ashland breached a term of his employment contract by not making a proper determination of product sales made by UAP, Uni-Select, Lordco and Cummins to member outlets operating in his territory.

[96] I am satisfied that a term of Mr. Marlowe's employment was that, for commission purposes, purchases of product by the member outlets operating in his territory were to be credited to his annual sales.

[97] In the 1995 fiscal year, Ashland asked each of these distributors to advise of the purchases made by member outlets in each of the three sales territories in British Columbia. Each distributor supplied the information in that year. Sales to be credited to Mr. Marlowe were properly determined in 1995.

[98] Ashland chose not to obtain similar sales information from distributors in the 1996, 1997 and 1998 fiscal years. Instead, Ashland estimated purchases made by various member outlets in each of those years. There was no acceptable evidence that this method of allocation produced a reliable result.

[99] Ashland only attempted to obtain information regarding sales in 1996, 1997 and 1998 when it wrote to distributors on May 4, 2001 in response to a court order. The letter produced no response. The failure to get the information was not explained in the evidence.

[100] I am satisfied that Ashland breached its obligation to accurately determine sales to members of purchasing organizations within Mr. Marlowe's territory in each of the 1996, 1997 and 1998 fiscal years.

[101] The letter of May 4, 2001 circulated to the distributors referred to Mr. Marlowe's termination and his action for wrongful dismissal. The letter forms the basis of Mr. Marlowe's complaint that Ashland inaccurately portrayed the circumstances to his detriment. While there was no need to explain the context in which the order had been made, there was nothing improper in doing so.

Bonus Entitlement

[102] Mr. Marlowe claims damages because of Ashland's failure to pay him bonus commissions for the fiscal year ending September 30, 1998 and for the stub period from October 1, 1998 to December 11, 1998 when he was terminated.

[103] Ashland says Mr. Marlowe was not entitled to the bonuses claimed because of the terms of the 1998 bonus program which said the following with respect to eligibility:

[104] The letter dated August 23, 1994 setting forth the terms of Mr. Marlowe's employment provided, in part, as follows:

[105] The issue is whether the 1994 letter regarding employment or the 1998 qualifications for eligibility deprive Mr. Marlowe of the right to a bonus when he has been wrongfully dismissed.

[106] In my opinion, the letter and qualifications meant that Mr. Marlowe was entitled to a bonus for the 1998 fiscal year if he did not resign in the year, if he was not dismissed for cause in the year, and if he worked at a level that warranted a performance rating of five or better in the fiscal year.

[107] Contrary to the company's claim, the letter and qualifications did not permit Ashland to avoid payment of a bonus by means of wrongful termination or an omission to fairly assess performance.

[108] The result urged by Ashland is not appropriate in the circumstances. The year ended on September 30, 1998. Mr. Marlowe was employed throughout the year. Bonuses were normally paid at the staff Christmas party held in the second or third week of December. Had he been fairly rated on performance in November 1998, Mr. Marlowe would have been eligible for a bonus. Had he been given proper notice of termination he would have been employed at the time of payment. In the circumstances, there is no reason why he should be deprived of a bonus calculated in accordance with the terms of the plan for the 1998 fiscal year.

[109] The analysis in relation to the stub period comprising only part of a fiscal year is different from the analysis for the 1998 fiscal year.

[110] If the employer's view of eligibility prevailed in the stub period, Ashland could deprive Mr. Marlowe of the bonus, which was an established portion of his compensation package, by giving reasonable notice of termination, say 4.5 months, ensuring that the notice period expired before the end of the fiscal year. That result is not warranted in the context of the employment relationship.

[111] The letter and qualifications create covenants on the part of the employee but not the employer. Mr. Marlowe's performance rating was satisfactory. He exceeded his sales requirements. He earned a bonus in each year of his employment.

[112] The employment contract is silent on the question of bonus entitlement in circumstances where Ashland wishes to terminate the employee other than for cause in the course of the fiscal year.

[113] In my opinion, the employment contract should be construed to contain an implied term that Mr. Marlowe would be entitled to a bonus when his employment was terminated at some point in the fiscal year other than because of resignation or dismissal for cause: see Bowen Estate v. Ritchie Bros. Auctioneers Ltd. (1999), 126 O.A.C. 139; O.J. No. 4012 (Ont. C.A.) at para. 25.

[114] The implied term is justified in law because it is reasonable and equitable, it is necessary to give business efficacy to the contract, it is capable of clear expression, and it does not contradict any express covenant on behalf of the employer in the contract: see Pottelberg v. British Columbia Telephone Co. (1995), 11 C.C.E.L. (2d) 87 (B.C.S.C.).

[115] The suitability of the implied term can be assessed by asking whether, if the parties had considered the issue at the outset, they would have agreed that an employee would be entitled to a bonus of some amount if his employment ended other than for cause or because of resignation. I am satisfied they would have agreed that a pro-rated bonus would be paid, computed by reference to the experience of prior years.

[116] I conclude that Mr. Marlowe is entitled to a bonus in respect of the 1998 fiscal year and for the stub period.

[117] The bonus program was part of the compensation package and for the reasons I have stated in relation to the stub period, I am also satisfied that Mr. Marlowe is entitled to a pro-rated bonus in respect of the reasonable notice period for dismissal.

Notice Period

[118] The parties agree that the appropriate notice period, before considering factors that might justify an extension, was 4.5 months. There is no reason to depart from that agreement and I fix the base notice period at 4.5 months.

Extension of the Notice Period

[119] Mr. Marlowe claims that the notice period should be extended because of the company's conduct in the course of the dismissal. The authority to do so is contained in the decision of Wallace v. United Grain Growers Ltd., [1997] 3 S.C.R. 701 (S.C.C.).

[120] The pre-conditions to the application of the Wallace principle are that the employer must subject the employee to callous and insensitive treatment in the course of dismissal; the employer must engage in bad faith conduct or unfair dealing in the course of dismissal; or the manner of dismissal must cause injury such as humiliation or embarrassment or damage to the employee's sense of self worth and self esteem: see Cassady v. Wyeth-Ayerst Canada Inc. (1998), 54 B.C.L.R. (3d) 68 (C.A.).

[121] There is insufficient evidence from which I could conclude that the manner of dismissal, summarized in the letter of December 11^th, caused humiliation or embarrassment, or damage to Mr. Marlowe's sense of self worth and self esteem to any greater degree than is likely to be associated with any termination.

[122] On all of the evidence in this case, my opinion is that the employer's egregious conduct related to the breach of its obligation to conduct a fair and bona fide review of Mr. Marlowe's performance in the fiscal year ending September 30, 1998 for the purpose of computing bonus entitlement. However, on the evidence adduced, I am not satisfied on the balance of probabilities that the assessment of performance completed on November 23, 1998 was made in the course of dismissal.

[123] Mr. Coxhead testified that while he completed the assessment he was not involved in the termination process. He testified that the recommendation to dismiss was made by Messrs. Brookes and Demay and forwarded to Mr. D'Ilario. In that Messrs. Demay and Brookes reported to Mr. Coxhead, the evolution of the decision to dismiss Mr. Marlowe and Mr. Coxhead's involvement in it might have been explored on cross-examination. It was not and, in this respect, Mr. Coxhead's evidence was not contradicted.

[124] In my opinion, appropriate damages in relation to the employer's conduct are more properly assessed in the context of the breach surrounding the assessment of performance and the resulting deprivation of bonus than in the context of the dismissal itself.

[125] I decline to apply the Wallace principle to extend the notice period because of the manner of dismissal or its effect on Mr. Marlowe.

[126] Mr. Marlowe is entitled to commissions in relation to sales by distributors to member outlets in his territory; a bonus for the 1998 fiscal year; and a bonus for the stub period from October 1 to December 11, 1998.

[127] Because of the employer's failure to obtain the information it was obliged to obtain, it is not possible to compute the distributors' sales to member outlets in Mr. Marlowe's territory with any degree of accuracy. I assess Mr. Marlowe's loss at $4,000.

[128] The assessment of the amount of the bonus of which Mr. Marlowe was deprived in 1998 because of the improper performance review depends on the rating he would have received had the review been properly carried out and had a proper determination of sales attributable to him in the 1998 fiscal year been made.

[129] Because Mr. Coxhead rated Mr. Marlowe at level four in two categories where the sales information relied upon was inaccurate and considerably less than actual, and because he admitted that his rating in a third category should have been increased from a rating of six, I find that a fair review would have resulted in an overall rating of four.

[130] The bonus program stipulated that a territory manager would receive a bonus of 9 per cent of base salary if his sales exceeded budget by 5 to 9.9 per cent. Mr. Marlowe's sales in 1998 of 903,951 litres exceeded his budgeted sales of 837,004 litres by 8 per cent. On Mr. Marlowe's base salary of $42,351, this portion of the bonus totalled $3,811.59.

[131] The program provided that an overall rating of four entitled the employee to a further bonus of 6 per cent of base salary. In Mr. Marlowe's case, that portion of the bonus was $2,541.06.

[132] Finally, the program provided for a corporate bonus of 4 per cent of base salary in the event the consolidated Canadian profit objective was achieved, as it was. In Mr. Marlowe's case, that portion of the bonus was $1,694.04.

[133] I assess the total bonus to which Mr. Marlowe was entitled in the 1998 fiscal year at $8,046.69.

[134] I assess the bonus to which Mr. Marlowe was entitled in the period from October 1 through December 11, 1998 at $1,676.39, that being a pro-rated portion of the bonus earned in 1998.

[135] Mr. Marlowe is entitled to the employer's Canada Pension Plan contributions payable in respect of income of $13,723.08 computed at rates applicable to the 2001 year.

[136] Mr. Marlowe is entitled to base salary and bonus for the notice period of 4.5 months. I assess the amount as $18,899.13, that being the aggregate of his pro-rated annual base salary and pro-rated 1998 bonus.

[137] Mr. Marlowe is entitled to the benefit of the company's Canada Pension Plan contribution in respect of that amount computed at rates applicable to the 2001 year.

[138] I am not satisfied that Mr. Marlowe is entitled to any compensation in respect of the loss of the use of a leased car. Mr. Marlowe tendered no evidence indicating that he had incurred any loss or expense as a result of the loss of the car.

[139] Mr. Marlowe is not entitled to any employer contributions to the employee's savings plan. The terms of the employee's savings plan were not identified in the evidence. I am unable to conclude Mr. Marlowe was entitled to any contribution in the period from October 1, 1998 through December 11, 1998 or in the notice period.

[140] The employer is entitled to deduct the sum of $3,258.22 paid as compensation in respect of termination from the award of damages in respect of the notice period.

[141] There was no suggestion that Mr. Marlowe failed to mitigate his loss. No reduction in the amount of the award on that account is appropriate.

[142] Mr. Marlowe claims punitive damages or aggravated damages in respect of the employer's breaches of contract before, and in the course of, dismissal.

[143] As a general rule, punitive damages are intended to punish a defendant for malicious conduct where the combined effect of general and aggravated damages is insufficiently punitive. In Hill v. Church of Scientology of Toronto, [1985] 2 S.C.R. 1130, Cory J. set out the law at para. 139 as follows:

[144] In deciding whether to award punitive damages, I am obliged to give very careful consideration to all of the circumstances and to exercise my discretion to make such an award with caution: Vorvis v. Insurance Corporation of British Columbia (1989), 58 D.L.R. (4^th) 193 (S.C.C.) at page 206.

[145] I have found that the manner of dismissal, although wrongful, was not so improper as to warrant the application of the Wallace principle. It follows that I also reject Mr. Marlowe's claim to punitive or aggravated damages in respect of the wrongful dismissal itself.

[146] The proper inquiry in this case is whether the breach of contract in relation to the 1998 performance review is of a nature that warrants the assessment of punitive damages.

[147] Counsel for Ashland submitted that a pre-condition to the assessment of punitive damages in a breach of contract case is that the conduct complained of constitute an actionable wrong independent of the breach itself. That may be a proper statement of the law where punitive damages are claimed in relation to a wrongful dismissal: see Vorvis, supra, at page 206; Wallace, supra, at para. 79; and Clendenning v. Lowndes Lambert (B.C.) Ltd. (2000), 82 B.C.L.R. (3d) 239 (C.A.), per Finch J.A., dissenting in part, at para. 63.

[148] I am not persuaded that an independent actionable wrong is a pre-condition to the assessment of punitive damages in breach of contract cases other than wrongful dismissal. In Royal Bank of Canada v. W. Got & Associates, [1999] 3 S.C.R. 408, the Supreme Court of Canada considered an appeal from an award of punitive damages in a breach of contract action resulting from the bank calling a loan without notice and appointing a receiver. At page 420 the court wrote as follows of the appeal from the award of punitive damages:

[149] At page 421 the court said the following of the trial judge's exercise of discretion:

[150] I have set out, in considerable detail, the facts and background resulting in Mr. Marlowe's action against his employer. I have found that Mr. Coxhead's conduct in relation to the performance review for the 1998 fiscal year was harsh, vindictive and malicious. It was, in sum, offensive and reprehensible.

[151] Mr. Coxhead supervised Mr. Marlowe for a period of just over three months from May through early August 1998. There is no evidence that Mr. Coxhead discussed Mr. Marlowe's performance with him, told him of shortcomings, or complained about him to anyone in the company's employ at any time in that period.

[152] The list of complaints compiled for discussion in early October made wholly unsubstantiated allegations of misconduct in those respects I have recounted and exaggerated the single complaint of substance. There is no evidence that any of the matters in respect of which Mr. Coxhead thought Mr. Marlowe should modify his practices had any adverse effect on the company. Indeed, I am satisfied on all of the evidence that Mr. Marlowe was an extremely productive salesman for the company. In the 4.5 years of his employment, he was instrumental in more than quadrupling sales in his territory.

[153] The performance review conducted by Mr. Coxhead which began in October and ended in November had three adverse effects. It deprived Mr. Marlowe of a bonus. It caused others to whom Mr. Marlowe reported directly to recommend his dismissal whether or not Mr. Coxhead intended that result. It permitted inaccurate information pertaining to Mr. Marlowe to be imparted to a prospective employer.

[154] I am satisfied that the only conclusion permitted by the evidence is that Mr. Coxhead conducted an unfair and mala fide review to deprive Mr. Marlowe of the bonus to which he was entitled. Were it necessary to do so to support an award of punitive damages, I would have no hesitation in concluding that Mr. Coxhead's actions and statements gave rise to an independent actionable wrong in the nature of defamation.

[155] I am prepared to infer from his course of conduct that Mr. Coxhead hoped for or expected Mr. Marlowe's resignation. Indeed, an individual of lesser determination than Mr. Marlowe might well have resigned in the circumstances.

[156] Mr. Coxhead should have been aware that the memorandum and the performance review might influence the kind of reference that would be provided by others in the company on behalf of Mr. Marlowe, as appears to have been the case in response to the Faucher inquiry. If the discussion with Faucher's representatives did not cause the withdrawal of their offer, there is every reason to conclude it was a contributing factor.

[157] Ashland had a human resources or personnel department. The department should have been able to advise Mr. Coxhead, who held the important position of national sales manager, of the manner in which he should proceed, and the price Ashland should be prepared to pay, if it wished to lawfully terminate Mr. Marlowe's employment.

[158] Employers are bound to deal with matters of employment fairly and in good faith. A substantial company such as Ashland with a human resources department and substantial profits, estimated by Mr. Coxhead to exceed $38 million annually, should be expected to refrain from the kind of employment practices it pursued in relation to Mr. Marlowe. Simply stated, the manner in which Mr. Marlowe was reviewed for the 1998 year was reprehensible and a substantial departure from the conduct and practices reasonably to be expected of an employer such as the defendant.

[159] Ashland must be reminded by means of a financial penalty of its obligation to deal with employees in good faith regardless of the level of the employee's position in the company. I assess punitive damages in the amount of $20,000.

[160] Mr. Marlowe is entitled to interest on the award for punitive damages from the date of breach, namely November 23, 1998 and on the remainder of the award of damages from December 11, 1998.

[161] Except as provided in these reasons, the plaintiff's claims for relief are dismissed.

[162] In the event any offer affects the calculation of costs the parties may address the issue by way of submissions through the registry. Otherwise Mr. Marlowe is entitled to recover his costs including disbursements. Disbursements shall include any reasonable amount paid by Mr. Marlowe to a solicitor or an accountant for advice in the conduct of his action.

"I.H. Pitfield, J."
The Honourable Mr. Justice I.H. Pitfield