IN THE SUPREME COURT OF BRITISH COLUMBIA
Stroppa v. Globe Foundry Ltd.,
2005 BCSC 312
Registry: New Westminster
Betty Ann Stroppa
Globe Foundry Ltd.
Before: The Honourable Mr. Justice Bernard
Reasons for Judgment
Counsel for the Plaintiff:
Counsel for the Defendant:
Date and Place of Trial:
October 25-29 &
November 5, 2004
New Westminster, B.C.
 In October 2000, when Betty Stroppa was about 47 years of age, she was fired from her job as office manager of Globe Foundry, in Burnaby, B.C. She had worked for Globe for 27 years.
 Globe was started by her father and a partner in 1946. By the late 1980s, Ms. Stroppa and her two siblings, Robert Ewasiuk and Victoria Kirk, were owners of the business. Ms. Stroppa and Ms. Kirk each hold 24.7% of the shares and Mr. Ewasiuk holds 37%. The balance is owned by the estate of their late father.
 The three siblings are directors and officers of the company. Mr. Ewasiuk is president, Ms. Kirk is vice-president, and Ms. Stroppa is secretary/treasurer. Also, Mr. Ewasiuk and Ms. Stroppa were employees of the company. Ms. Kirk, who resided in Prince Rupert, was not.
 Problems arose within the family and within the business. The connection between the two is in dispute.
 At a directors’ meeting in February 2000, Mr. Ewasiuk and Ms. Kirk voted in favour of a resolution requiring Ms. Stroppa to take a three month “sabbatical” during which she was to: (1) enrol in and complete a time management course; (2) seek anger management counselling or enrol in an anger management course or program; and, (3) endeavour to stop smoking by seeking medical or other assistance to achieve this goal.
 Ms. Stroppa abstained and the resolution passed. It further provided that: “At the end of the three month sabbatical, a Director’s Meeting will be convened to review Betty’s progress regarding the actions she was required to take during her sabbatical and to decide on Betty’s future status as an employee of the company.”
 Ms. Stroppa took her sabbatical and enrolled in some courses. She returned to work in July 2000.
 At a directors’ meeting in October 2000, Ms. Stroppa was informed that she was “being dismissed as an employee of the company and offered a severance/buyout.” A resolution passed that provided that Ms. Stroppa’s employment would be terminated and that she would receive $50,000 as severance pay.
 Ms. Stroppa claims that she was wrongfully dismissed. She seeks severance pay equivalent to two years salary and benefits, estimated to be worth about $100,000. Globe’s position is that Ms. Stroppa was fired for just cause.
2. Evidentiary Synopsis
 Ms. Stroppa says that she and Mr. Ewasiuk were partners in the operation of Globe. In general, she was responsible for the office and he was responsible for the factory. Ms. Stroppa did not regard Mr. Ewasiuk as her boss. She knew that Mr. Ewasiuk did not like the way she ran the office; in particular, her decision to only prepare invoices every two weeks rather than every day, the working hours that she kept, the turn-over in office staff, and her cigarette smoking at work. Ms. Stroppa says, in essence, that she took these complaints under advisement because Mr. Ewasiuk was her partner, but she regarded the ultimate decisions about these matters to be hers.
 Mr. Ewasiuk says that he was the manager of the business; that he and Ms. Stroppa did not hold equal positions. He says that he was Ms. Stroppa’s supervisor and that she was required to take direction from him. He discussed, with her, his concerns regarding her performance, but she would not pay heed to his directions. This led to the directors’ resolutions regarding Ms. Stroppa’s performance.
 Ms. Kirk says that Mr. Ewasiuk had “overall responsibility” for the company, which included authority over Ms. Stroppa. She says that Ms. Stroppa was required to follow Mr. Ewasiuk’s directions and that Mr. Ewasiuk had the authority to fire her or suspend her without a directors’ resolution. Ms. Kirk acknowledged that “it was obvious that she (Ms. Stroppa) had a different view” regarding the management hierarchy.
 There is no evidence documenting the management structure of the business. From the February 2000 directors’ meeting to Ms. Stroppa’s termination in October 2000, insubordination was never given as a reason for any of the measures taken against her, including her ultimate dismissal.
 Ms. Stroppa has been unemployed since she was fired from Globe. She described minimal employment search efforts and conceded that she had not spent a lot of time searching for a new job. She expressed serious doubts about finding such employment with no references after a 27-year work history with one employer. She says that the manner of her dismissal has had a negative impact upon her self-esteem and personality. She could not bring herself to prepare a “two-line” resume. She said that there was no prospect of working for another foundry in the same business because of her ownership interest in a competitor.
 In my opinion, a determination of the management hierarchy at Globe Foundry, and Ms. Stroppa’s knowledge of it, is threshold to the question of whether Ms. Stroppa was wrongfully dismissed.
Did Mr. Ewasiuk have the authority to direct Ms. Stroppa?
 There is a dearth of independent evidence in relation to this question. One might expect that documents would show the management structure of the business, but it seems that none exist. The only informed testimony about the structure comes from the three owners; persons who could not be regarded as independent.
 Nonetheless, Mr. Ewasiuk and Ms. Kirk both assert that Mr. Ewasiuk was the manager of the company and the supervisor of Ms. Stroppa. I prefer their evidence to that of Ms. Stroppa on this issue. They corroborate one another. More importantly, it accords with common sense that there would be one overall manager who would make the final decision if disagreements arose. Ms. Stroppa does not assert that she was the overall manager; rather she says that she was a manager of equal standing to Mr. Ewasiuk, but with different responsibilities, and with no one above them. She does not explain how business decisions would be made if the two managers were at odds. Mr. Ewasiuk was a larger shareholder than Ms. Stroppa. It is, at least, consistent with his greater stake in the company that he would be the overall manager.
 For these reasons, I am satisfied on a balance of probabilities, that Mr. Ewasiuk had the overall responsibility for running the business and had authority to direct Ms. Stroppa in the course of her employment as office manager.
Did Ms. Stroppa know that Mr. Ewasiuk was the boss?
 This is a more troublesome question. There is an absence of a documented management structure of any sort, let alone one accessible to Ms. Stroppa from which it could be inferred that Ms. Stroppa must have known that Mr. Ewasiuk was her boss.
 In many ways the manner in which Mr. Ewasiuk dealt with Ms. Stroppa was inconsistent with his authority over her. The gist of the evidence of Mr. Ewasiuk and Ms. Kirk was that Mr. Ewasiuk had the authority to fire or suspend Ms. Stroppa without directors’ resolution, yet he never did so.
 Ms. Kirk said that it was obvious to her that Ms. Stroppa did not believe that she was required to follow Mr. Ewasiuk’s direction, yet this issue was never squarely dealt with either at the workplace or at directors’ meetings.
 The evidence shows that Mr. Ewasiuk opted to deal with Ms. Stroppa’s performance issues by directors’ resolutions. In this sense, he abdicated his responsibility as the manager of the business. By so doing, he reinforced Ms. Stroppa’s belief that he did not have authority over her in the running of the business. If he had taken actions against Ms. Stroppa directly, then it is likely that the question of whether he had the authority to do so would have come to the fore.
 Regrettably, the management hierarchy was not raised at the directors’ meetings at which disciplinary measures were taken against Ms. Stroppa.
 The crux of Mr. Ewasiuk’s complaint against Ms. Stroppa was insubordination, yet it was not framed as such; accordingly, the management structure was not discussed. Instead, Ms. Stroppa was led to believe that any discipline against her had to be meted out by resolution of the directors; that Mr. Ewasiuk did not have the authority to do so.
 There is no evidence that at any time after the “sabbatical” was imposed, the management hierarchy was mentioned or discussed. When Ms. Stroppa was dismissed by resolution of the directors, it was ostensibly because she had failed to comply with conditions imposed upon her by the February 2000 resolution, and not for insubordination.
 In light of the forgoing, I am satisfied that Ms. Stroppa did not know or believe that Mr. Ewasiuk was her boss; thus, she did not know or believe that a failure to follow his directions was insubordination that could justify dismissal. Ms. Stroppa believed that she had the ultimate say in respect of office matters. Moreover, I cannot find that the belief was unreasonably held, in all the circumstances.
 The complaints about Ms. Stroppa must be assessed in light of the answer to the latter threshold question. Ms. Stroppa believed that she had the authority to, inter alia, set her own working hours, decide how frequently invoicing would be done, and deal with the office staff in her own manner.
 Mr. Ewasiuk did not like Ms. Stroppa’s decisions and the manner in which she conducted herself. His concerns were voiced to Ms. Stroppa many times, but she did not change her ways. He was frustrated and angry with her. Their relationship was severely strained and it created a stressful working environment for them and others. In spite of the situation, Mr. Ewasiuk never told Ms. Stroppa that he would fire her if she did not “smarten up.” Had he done so, her likely response would have been “you’re not my boss” or words to that effect, which would have raised management hierarchy as an issue.
 In my opinion, Ms. Stroppa’s work performance cannot be fairly assessed in light of the fundamental misunderstanding that existed about Mr. Ewasiuk’s authority over her. The essence of the complaints justifying dismissal is insubordination. It would be grossly unfair to find insubordination in respect of someone who honestly and reasonably believed that she was not obliged to take the directions that she chose to ignore.
 Somewhat surprisingly, the hierarchy issue was not discussed at the time she was ordered, by directors’ resolution, to take a leave of absence. It is only “somewhat” surprising because the parties were completely at odds with one another at the time; the atmosphere was not conducive to reasonable discussion. I accept Ms. Stroppa’s evidence that the resolution came by surprise – her job performance was not on the agenda. It was evident that Mr. Ewasiuk and Ms. Kirk had decided to take action against Ms. Stroppa prior to the meeting and, at the meeting, the resolution was quickly passed.
 In my opinion, Mr. Ewasiuk and Ms. Kirk wrongly opted to deal with Ms. Stroppa’s work performance by directors’ resolution, when it ought to have been dealt with directly by Mr. Ewasiuk, in his capacity as general manager of the business. The matter for discussion and resolution at the February directors’ meeting should have been the management hierarchy of the company. Once that had been resolved, Ms. Stroppa’s subsequent work performance could have been fairly assessed. Assuming that it was resolved in favour of Mr. Ewasiuk as overall manager, Ms. Stroppa’s failure to take his direction thereafter would have been insubordination that might have justified dismissal. One can only speculate as to what might have occurred, or how Ms. Stroppa might have conducted herself, after the hierarchy issue had been resolved.
 The entire matter of Ms. Stroppa’s dismissal was handled badly. At its roots was a fundamental misunderstanding of long standing; one which directly influenced the conduct of the parties and created a great deal of animosity over the course of time. Without resolution of the fundamental misunderstanding, Ms. Stroppa was disciplined and then fired.
 In these circumstances, I cannot conclude that Ms. Stroppa was fired for just cause; accordingly, she was entitled to proper notice.
How much notice was Ms. Stroppa entitled to?
 Notice entitlement is established through a determination of what is objectively reasonable in the circumstances of the case, given the character of employment function, age, length of service, and the availability of equivalent alternative employment having regard to one’s experience, training, and qualifications. The upper limit to notice is generally accepted to be 24 months, except in exceptional cases.
 Ms. Stroppa submits that 24 months is proper notice. In support of her position she cites the cases listed in Appendix A. In Bauer, Burry, and Moody, the court set the notice period at 24 months.
 Globe submits that 12-15 months is proper notice. In support of its position it cites the cases listed in Appendix B. It submits that cases in which awards exceed 15 months deal with significantly higher levels of job responsibility than that held by Ms. Stroppa and extremely poor markets for alternative employment.
 Ms. Stroppa worked for 27 years with Globe Foundry. She worked as the office manager, supervising a few employees and assuming responsibility for invoicing, book-keeping, payroll, and the various and sundry tasks done in the office of a small foundry business. She was about 47 years of age when she lost her job. Virtually her entire working life was with Globe. Her employment situation was unusual, in that she was an owner of the company and it was a family business of long standing. She took pride in the business and expected that it would provide her with employment for her working life. She worked 30 hours per week and had flexibility in her working hours. The hours were important to her because of the needs of her family – she has a schizophrenic daughter and a drug-addicted son. She received $26.75 per hour, 12% vacation pay, and employee benefits.
 When Ms. Stroppa was fired, she was devastated and depressed. She was ousted from a family business of which she loved being a part. She believed that her prospects of finding equivalent alternative employment were poor because of the circumstances of her dismissal. She had no positive references to present to a prospective employer. She could not expect to find employment with another foundry because she was an owner/competitor.
 Ms. Wilkinson, a vocational consultant, opined that Ms. Stroppa has transferable skills and that it should take her no more than three months to find similar employment. Ms. Wilkinson’s opinion was compromised by her admission that she did not know that Ms. Stroppa’s $46,000 annual income was based upon a 30- hour week. Also, Ms. Wilkinson never met with Ms. Stroppa. She agreed that personality variables add an important element that could alter her opinion. Also, she readily conceded that the absence of experience in applying for jobs in the past, the absence of good references, and being fired for poor work performance, are factors that add “layers of difficulty” to finding equivalent alternative employment. When asked if Ms. Stroppa was in a strong position to secure similar employment, Ms. Wilkinson’s frank response was: “probably not.” It is undoubtedly the case that Ms. Stroppa would get a very poor reference from Mr. Ewasiuk, and, that there is slim likelihood that a prospective employer would not seek a reference from a 27-year previous employer.
 In Moody v. Telus Communications Inc., 2003 BCSC 471, Cullen J. set the notice period at 24 months for a 51-year old man in a low to middle-management position who had worked for the defendant for 27 years. In so doing, he said, at para. 32:
It seems to me that the common theme which runs through those cases relied on by the plaintiff as establishing the reasonableness of a notice period of 24 months or more where the Bardal factors of character of employment, age, length of service, and availability of similar employment otherwise augur in favour of the rough upper limit, encompasses circumstances where the employee is put in a particularly vulnerable position by the termination. That vulnerability may be established where an employee has gone from a role of great responsibility and recompense to none and will be hard-pressed to find comparable employment because of the inherent scarcity of such positions, or where an employee has gone from a lesser position to none and because of circumstances affecting him or her uniquely is put at a disadvantage beyond the norm in seeking comparable employment.
 For reasons that are different than those in Moody, but equally compelling, I find that Ms. Stroppa has been put in a particularly vulnerable position as a result of her termination. Ms. Stroppa reasonably believed that she had a job for life, and she conducted herself as others might if they thought that they would never find themselves in the job market, again. She had no concerns about upgrading her skills and education, or about her attractiveness to future employers.
 Ms. Stroppa’s sense of job security with Globe was not misplaced. It was a family business, and she was a member of the family. She was an owner of the company. She reasonably believed that so long as the business prospered she would never find herself looking for another job. She believed that she was a co-manager of the company and conducted herself accordingly. By Mr. Ewasiuk’s conduct, he reinforced this belief. When there were disagreements with her brother, Ms. Stroppa had no reason to think that her job was in jeopardy.
 Ms. Stroppa now finds herself, most unexpectedly, in the job market, with education, skills, and personal traits that make it most improbable that she will find equivalent alternative employment.
 For all the foregoing reasons, I find that a notice period of 24 months is appropriate in the unusual circumstances of this case and the particularly disadvantaged position in which Ms. Stroppa has been left by her dismissal from a life-time of employment within her family business.
Did the plaintiff fail to mitigate her damages?
 The duty to mitigate is a duty that wrongfully dismissed employees owe to themselves. The plaintiff employee is obliged to limit the damages that result from the defendant employer’s breach, by taking reasonable steps to secure alternative employment similar in nature, status, and salary to her former position. The duty does not require the dismissed employee to accept any position that is offered.
 The onus is on the defendant to prove a failure to mitigate, and if it is proved then full compensation will not be ordered.
 Globe submits that Ms. Stroppa did not make reasonable efforts to find comparable employment, and that such employment was available to her within the notice period. It relies on the evidence of Ms. Stroppa’s job search which shows that, at best, her search was half-hearted. Ms. Stroppa conceded in cross-examination that she did not spend much time looking for a job. She did not take any significant and sincere steps towards obtaining comparable new employment.
 Globe relies on the evidence of Ms. Wilkinson, who thought that Ms. Stroppa should have been able to obtain comparable employment within one to three months, based upon her skills, experience, and the marketplace. For reasons previously stated, I find that Ms. Wilkinson’s opinions are significantly compromised by some misinformation and by never having met with Ms. Stroppa.
 In Carlysle-Smith v. Dennison Dodge Chrysler Ltd. (1997), 33 C.C.E.L. (2d) 280 (B.C.S.C.), Brenner J., (as he then was) found that a mitigation defence may succeed if an employer proves that an employee has failed to take reasonable steps to avoid the loss. In relation to proof, he said, at p. 287:
Since the ability to mitigate is solely within the power of the plaintiff it would be a harsh burden to require an employer to prove that there were specific jobs available to the degree of specificity as contended by the plaintiff as a precondition to any mitigation whatsoever.
 Brenner J. found that the absence of evidence that an employee refused a specific job offer is not fatal to the defence. It is open to the employer to lead general evidence from which it might be inferred that if the employee had taken reasonable steps, then he would have likely obtained a comparable employment position.
 In relation to reducing the notice period for failure to mitigate, Brenner J., said, at p. 288:
Clearly the less the mitigation effort and the stronger the evidence of prospective alternative employment the more heavily this factor will be weighted in determining the appropriate notice period,
 I am satisfied that Globe has proved that Ms. Stroppa did not make reasonable efforts to find comparable employment. Ms. Stroppa was depressed and lacking in confidence when she lost her job with Globe. She believed that no one would hire her for a comparable position. She doubted that any comparable positions existed. Her entire working history was with Globe and she had ample reason to believe that any reference she received would be poor. She was not motivated by dire financial need. She frankly stated that she was waiting for the damage award from this lawsuit before deciding her work future.
 The more troubling question is whether comparable positions were available to her within the notice period. Ms. Stroppa’s role, per se, as manager of a small office was not out of the ordinary – there are many comparable positions in the marketplace. The unusual aspect of her position was the considerable flexibility she enjoyed in choosing her daily working hours and the overall number of hours she worked. The problem with using this factor in assessing comparables is that setting her own schedule was, in fact, contrary to the directions of Mr. Ewasiuk, whose authority she was under.
 In these circumstances, it would be inappropriate to consider the unusual flexibility of Ms. Stroppa’s former employment as a factor in assessing the availability of comparable positions.
 I accept the evidence of Ms. Wilkinson that comparable positions were available within the two-year notice period. The position of office manager is not a highly specialized or unusual occupation. However, I am not persuaded that Ms. Stroppa could have secured a comparable position within one to three months. This is contrary to Ms. Wilkinson’s ultimate opinion that Ms. Stroppa was “probably not” in a strong position to secure alternative comparable employment, and inconsistent with her testimony that Ms. Stroppa’s absence of a work reference from her only employer added a “layer of difficulty” to her search. Also, it fails to take into account the understandable depression into which Ms. Stroppa lapsed after her dismissal.
 Following her dismissal, Ms. Stroppa needed time to recover. She lost long lasting employment and was ostracized from daily involvement in a family business started by her father. Once she was emotionally ready to search for new employment, I am satisfied that without considerable assistance, skills upgrading, or retraining, she would have had great difficulty securing comparable employment.
 In all the circumstances, I find that the defendant has proven, on a balance of probabilities, that Ms. Stroppa could have secured comparable alternative employment within two years. However, I am satisfied that it would have taken Ms. Stroppa considerably longer than Ms. Wilkinson’s estimate of one to three months. I find that Ms. Stroppa’s depression would have justifiably delayed the commencement of a job search by at least six months. Thereafter, I find that with reasonable efforts she likely would have secured comparable alternative employment within 14 months. Accordingly, the 24 month entitlement is reduced to 20 months, in recognition of Ms. Stroppa’s failure to mitigate her damages.
4. Assessment of Damages
 The parties agree that Ms. Stroppa’s gross monthly salary, inclusive of 12% vacation pay, is $3,834 per month. Ms. Stroppa seeks compensation for lost employee benefits. She submits that the value of these benefits is $412.42 per month.
 The defendant opposes compensation for lost benefits, and submits that the plaintiff has not shown that she replaced the benefits or that she incurred expenses that would have been covered by her employment benefits.
 In Wilks v. Moore Dry Kiln Company of Canada Limited (1981), 32 B.C.L.R. 149 (B.C.S.C.), McLachlin J., (as she then was) said the following in relation to a claim for lost employee benefits, at p. 152:
The question is not what the defendant has gained by the dismissal, but what the plaintiff has lost. This loss must be established on the evidence. If the plaintiff fails to show that he has paid out or lost money or has otherwise suffered by reasons of the absence of fringe benefits, his claim cannot succeed.
 The only evidence of out-of-pocket expenses or other suffering due to lost benefits is Ms. Stroppa’s testimony that, after her dismissal, she incurred significant dental expenses. She was unable to find receipts or produce any other record of these expenses; accordingly, she did not know the exact amount or precisely when they were incurred. As for the amount, she estimates that it was $2,500. As for the date, she thinks it was “a few months before October 2002.” Ms. Stroppa’s estimate of the date is determinative of the issue because it is the only evidence of when the expenses were incurred, and on her evidence the date falls outside her notice entitlement period.
 I find that, in relation to lost benefits, there is no evidence of actual expenditure or other loss by Ms. Stroppa during the 20 month period after her dismissal; accordingly, there is no basis for compensation for the loss of benefits.
 The plaintiff’s claim for severance pay in lieu of reasonable notice is allowed. The notice period to which she is entitled, before consideration of mitigation or failure to mitigate, is 24 months. The notice period is reduced to 20 months due to the plaintiff’s failure to mitigate.
 The plaintiff received two weeks’ notice from the defendant upon being dismissed on October 12, 2000; accordingly, she is to be compensated for 19.5 months of lost salary and vacation pay, plus pre-judgment interest.
 The plaintiff has been substantially successful in her claim. She is entitled to the costs of the trial, on scale 3.
“L. Bernard, J.”
The Honourable Mr. Justice L. Bernard
September 14, 2006 – Revised Judgment
On the front page of the Reasons for Judgment, the Date of the Trial should read:
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