The Whalley Trial Part X: The Defense Rests

Editor’s Note: John Whalley, the former Economic Development Manager of the Cape Breton Regional Municipality (CBRM) is suing the CBRM for constructive dismissal. The case finally came to trial from 20-24 August 2018 and the Spectator was there. We’re presenting our coverage in a series of articles because the trial touched on so many issues of interest to CBRM residents. This is Part X (Read Part I,Part II,Part III,Part IV,Part V, Part VIPart VIIPart VIII and Part IX).


At the end, both the plaintiff and the defendant summarize their arguments. The judge must then consider the evidence presented before making a decision, based on what has been proven to be most probable. He or she must decide whether the facts show that the defendant has broken a civil law, such as a law that says we are obliged to fulfill our contracts.

John Whalley’s constructive dismissal suit against the CBRM wound up on Friday 24 August with summations by both sides.

Tony Mozvik (Source: ContactOut)

Tony Mozvik (Source: ContactOut)

First up was the lawyer for the defendant (the CBRM), Tony Mozvik, who opened by acknowledging that it had been a “long week” and thanking Justice Patrick Murray for his “patience” and “direction.”

Obviously there’s some contentious issues and some underlying issues, but I do acknowledge that your lordship handled those issues very delicately and sensitively, and I do appreciate that.

Mozvik then respectfully submitted that (despite the length of the week and the degree of patience and direction required of the presiding judge) what was before him was “a very simple case.”

In the defense’s view, it came down to two issues. The first, “was Mr. Whalley constructively dismissed…up to and including May 25, 2015?” and the second was “the role of mitigation.”


Best evidence

Mozvik actually began by focusing on the terms of Whalley’s contract, particularly what it said with regards to severance and mitigation (an employee’s duty to lessen the financial impact of a dismissal). In this case, there was the added twist that Whalley claimed he’d signed a written contract in addition to his letter of hire, but was unable to produce it.

Mozvik argued that Justice Patrick Murray should invoke the best evidence rule in the matter of what he termed Whalley’s “mysterious employment contract.”

According to Duhaime’s Law Dictionary, the best evidence rule, simply stated, is that:

When a document is proposed as evidence, the original must be produced.

Sometimes also known as the original document rule but the scope of the rule is not limited to documents.

The rule is said to have originated with these words of Justice Holt in the 1701 case of Ford v Hopkins:

“… the best proof that the nature of the thing will afford is only required.”

Duhaime’s explains that the law has had an “up and down” history in the United States and other common law jurisdictions (like Canada) “especially with the advent of new forms of communications which, in the era of Justice Holt, meant only paper documents.” The advent of the internet, Duhaime’s notes, has re-opened debate about the rule, but a 1969 ruling (Garton v Hunter) by one Lord Denning provides a “flexible and adaptable” approach that accommodates new media. Denning wrote:

That old rule has gone by the board long ago. The only remaining instance of it that I know is that if an original document is available in one’s hands, one must produce it. One cannot give secondary evidence by producing a copy. Nowadays we do not confine ourselves to the best evidence. We admit all relevant evidence. The goodness and badness of it goes only to weight, and not to admissibility.

Duhaime’s also notes an opinion by Justice Brewster of the Court of Civil Appeals of Texas in which he articulated the best evidence rule as follows:

A written instrument is itself the best evidence of its contents. The general rule is that if the original writing is not produced or its non-production accounted for, secondary evidence of its contents is not admissible….

Where inquiry is being made as to the contents of a material document, the only competent evidence of such contents is the document itself, unless the document be first shown to be unavailable as being lost or destroyed or absent from the jurisdiction without fault on the part of the person offering the evidence, or as being in the adversary’s possession where he has been notified to produce it, or as being a part of the public records, in all which cases other evidence may be resorted to.

Mozvik (I think) was arguing that the “best evidence” of Whalley’s written contract would be Whalley’s written contract — and it wasn’t produced. What was produced, and entered into evidence, was Whalley’s letter of hire which Mozvik argued was in keeping with the testimony of CBRM HR director Gordie MacDougall, who said CBRM managers and senior managers received letters of hire and those letters contain no reference to severance.


Never to late to mitigate!

Mozvik then cited Nova Scotia Associate Chief Justice Deborah Smith’s 2006 Clelland v. eCRM Networks Inc. decision in which she cites Ontario Superior Court Justice Ian Nordheimer’s 2000 Graham v. Marleau, Lemire Securities Inc. decision (I told you this was technical) to argue that where a contract is silent on mitigation (as Whalley’s letter of hire was), mitigation applies; and that even if Whalley did have a contract like that of former CAO Jerry Ryan, since Ryan’s contract was silent on mitigation, mitigation would also apply.

Mozvik further argued that, if Justice Murray were to decide that Whalley had been constructively dismissed and was entitled to damages, they should be interpreted as common-law damages rather than severance and that under common-law damages, mitigation would apply. Moreover, he said, all evidence suggested Whalley had, in fact, mitigated his damages (by going to work at  New Dawn one month after leaving the CBRM).

All of which basically meant that no matter which scenario the judge believed, the CBRM would not owe Whalley more than one month’s pay in damages.


Kerr vs Valley Volkswagen

As to the question of whether Whalley was, in fact, constructively dismissed, Mozvik began by citing a 2015 Nova Scotian decision, Kerr vs Valley Volkswagen

Mozvik didn’t go into detail about the case in his summation and I’m not going to either because I honestly don’t see how the Kerr case (in which the plaintiff, Gary Kerr, threatened to quit his job and look for other work if he didn’t get a raise, was taken at his word by his employer, then claimed he hadn’t actually resigned) is relevant to the Whalley case.

Valley Volkswagen logo. (Source: Facebook)

Source: Facebook

According to Jeff Hopkins, who wrote about Kerr vs Valley Volkswagen in 2014 for Canadian Employment Law Today, Valley Volkswagen acknowledged it had no grounds for firing Kerr – its defense “rested entirely on a finding that Kerr resigned or quit.”

And significantly, from the point of view of the Whalley case, Kerr did not claim he’d been constructively dismissed – his position, says Hopkins, was that “he was terminated, or that he simply did not quit.”

Kerr’s case came down to a question of whether or not “a reasonable person” would believe that what Kerr had told his boss amounted to a resignation – and the court decided that a reasonable person would, in fact, believe it.

Mozvik, in citing this case, told the court he “didn’t think” there had been much dispute about whether or not Whalley had resigned, but he “just wanted to cover it off.”

…I don’t believe anybody has indicated in any shape or form that [Whalley’s resignation] was involuntary…Nobody held a gun to his head, so to speak. Nobody forced him into resigning. Nobody pressured him into resigning. It was his choice to resign.

That being the case, Mozvik told the court, the question becomes, did Whalley have good reason to quit?

To answer that, he referred the court to another case


MacKinnon vs Acadia University

MacKinnon versus Acadia University, the second case Mozvik cited, is really interesting and, unlike Kerr vs Valley Volkswagen, it actually was a constructive dismissal suit.

The plaintiff, Paula Cook MacKinnon, was a senior administrator at Acadia from 1988 until 2007, when she quit after the president of the university assumed personal responsibility for enrollment and admissions, areas that had been Cook MacKinnon’s purview. Cook MacKinnon argued this change – made without any prior consultation with her — constituted a fundamental shift in her duties.

Acadia University. (Source: CBC)

Source: CBC

In his (2009) decision, Justice Gregory M. Warner wrote:

The issue in this case is not whether Ms. Cook MacKinnon “quit;” she walked out on the early morning of June 6, 2007, without notice to her employer after receiving legal advice. The first real issue was whether she had “good reason.” The second issue is whether she acted reasonably in her duty to mitigate.

The case is similar to the Whalley case in some ways but quite different in others. In fact, Justice Warner actually notes in his judgment that case law in constructive dismissal cases provides “helpful but limited guidance, and should be read with caution,” in part because:

…there are few reported decisions involving constructive dismissal with sufficiently similar elements so as to be truly comparable. Many of the decisions cited by the parties have some common elements to those in this case but those same decisions often contain other elements and factors that in my view are very dissimilar and which were influential in that court’s decision.

Mozvik drew the court’s attention to a paragraph in which Warner cited the “seminal text” on constructive dismissal in this country – Quitting for Good Reason, The Law of Constructive Dismissal In Canada, by (now Justice) Randall S. Echlin and Jennifer M. Fantini — on what constitutes a “good reason” to quit. In MacKinnon’s case, Warner wrote, it came down to:

1)       The express and implied terms of her employment contract;
2)       Whether those terms were breached by the employer; and,
3)       If so, whether the breach was a substantial or fundamental change to the essential terms of the employment contract.

In Cook MacKinnon’s case, Warner ruled that her employment contract had not been breached and that the change introduced by the president was not “substantial” or “fundamental” because Cook MacKinnon had a broad range of important responsibilities and the judge felt calling any one of them a “core” responsibility was a misnomer.

As for the duty of mitigation, Warner noted that not long after leaving Acadia, Cook MacKinnon was offered a similar administrative position at St. F.X. University in Antigonish which she turned down because she didn’t want to commute three hours from her home in Wolfville. (Her husband taught at Acadia and her son studied there.)

Nor did Cook MacKinnon seek work in Halifax where, the decision notes, “it is a well-known fact” there are a number of institutions of higher learning. Instead, Cook MacKinnon opted to establish a consulting business from which she earned no income for the first two years. Moreover, she moved to a house she owned an hour’s commute from Wolfville, which Warner argued made “no sense” in light of her refusal to commute to Antigonish. Taking all of these factors together, Warner ruled she had failed in her duty to mitigate.

(Mozvik obviously didn’t get into all this detail, I’m doing so because I find it interesting. And because I can. Three cheers for slow journalism!)

Mozvik did attempt to answer the “good reason” questions in relation to John Whalley’s case, though, telling the court that to answer them it was necessary to analyze Whalley’s employment contract, as it was written, and also “his history with the CBRM and what job he had,” an exercise Mozvik began this way:

To start out, and I think it is unequivocal, that he did not create jobs…that was clear from [former CBRM CAO Jerry] Ryan and that was clear from him. That wasn’t his responsibility, according to him. In fact, he was very successful at not doing that.

From there, Mozvik made the argument that Whalley’s letter of hire was not a contract of “specificity,” but rather dealt with “economic development in a broad context.” At no point in his career with the CBRM, argued Mozvik, did Whalley deal with just one issue (the port), he always had other areas of responsibility – like the railway, the sustainability fund and the potential relocation of the Nova Scotia Community College’s Marconi College.

When he was removed from the port file, argued Mozvik, what was left to him constituted valid employment:

This isn’t throw him a bone, get rid of him. This is meaningful work.


Takes ball, goes home

Mozvik then moved on to examine Whalley’s reasons for resigning, as outlined in his resignation email.

Where Whalley stated that his main duties had been removed from him with the reassignment of the port file, Mozvik again stressed the other issues that would still have been Whalley’s responsibility after 28 May 2015, including some non-specified port-related issues.

Where Whalley claimed his demotion had followed his raising flags on the McKeil deal — particularly after he’d questioned whether lawyer Jim Gogan (who had been hired through Business Cape Breton and was reporting directly to CBRM Mayor Cecil Clarke and who represented both the buyer and the sellers in the deal) had a conflict of interest – Mozvik suggested that Whalley was not a lawyer and:

Those who don’t have legal training have no role in determining what a conflict of interest is.

As for Whalley’s concern that the McKeil deal constituted a subsidy to a private business, Mozvik said:

That is his opinion and he’s entitled to it. But it’s wrong.

In Mozvik’s version of events, Whalley did his job and raised concerns about the deal (as did then Chief Financial Officer Marie Walsh), the Mayor “directed [then CAO] Michael Merritt to go to Municipal Affairs and get it dealt with,” Municipal Affairs “vetted” the deal and declared it in keeping with the Municipal Government Act (MGA).

The matter was vetted through the province of Nova Scotia. The agreement was never challenged. The agreement was provided to council and approved. If you look down the harbor, you’re going to see that there’s people working there…A good thing in a community that’s starving for jobs. Not a bad thing.

Furthermore, argued Mozvik, Whalley’s claim that he was punished for raising such concerns by being removed from the port file makes no sense when compared to the fate of CFO Marie Walsh, who also raised concerns about the McKeil and who got “a big promotion” afterwards, being named CAO when Merritt left the CBRM.

As for Whalley’s “lack of confidence” in Merritt as CAO (referenced by Walsh in her testimony, Mozvik said:

That’s not a justifiable reason to quit. That’s not a good reason to quit. Lots of people don’t have confidence in their bosses, but if we allow that to be a reason to sort of take your ball and go home, we’re going to turn employment law on its head.

(Mozvik referred to Whalley “taking his ball and going home” so frequently I was beginning to think there was an athletics component to the economic development manager’s position I’d missed.)

Mozvik (who, you may recall, opened his summation by remarking on Whalley’s success in not creating jobs) then argued that there was no animus towards Whalley in the Civic Centre where:

People respected him. They respected his work…

And even though, at the start, there had “appeared to be some difficulties between the Mayor and Mr. Whalley” within a short period of time, said Mozvik, the mayor came to respect and rely on the economic development manager.

Whalley’s decision to quit, then, came down to a sort of “arrogance,” the belief he had a God-given right” to work on the port file.

Citing the interview Whalley gave the Cape Breton Post in November of 2015, in which he’d said he was happy to be “out of politics,” Mozvik suggested Whalley had left his job because he “had a hard time” with the politics. (He also claimed that in admitting in the article that he was not a chartered accountant, Whalley was basically admitting he was not qualified for his new job as CFO of New Dawn.)

Mozvik told the court that in matters of policy, you make your case and if your opinion does not carry the day:

You live to fight another day. You don’t take your ball and go home. You man up, grow a backbone and continue with the job.

(He didn’t attribute this to anyone, so I presume it’s an original quote, although my first thought was that it must have come from some 1950s coaching manual.)


Famous last words

And then, Mozvik wrapped it all up:

What we have here is a gentleman who worked for the CBRM for 17, 18 years. He leaves, supposedly doesn’t have any employment, then all of a sudden he finds himself employed with New Dawn, four weeks later. Didn’t apply for the job, finds himself at New Dawn. New Dawn just happens to be run by the gentleman who ran against the mayor on two occasions. You wonder why, you start thinking about these things and wonder what’s going on here? So I go to the New Dawn website and I see Jerry Ryan is actually on the board. All roads lead to New Dawn and I respectfully submit, and I know your lordship may take issue with this, but I respectfully submit that there’s something untoward going on here. There’s something pushing this other than the fact that the plaintiff feels he was constructively dismissed. There’s concerns lurking in the back…That’s all I have to say about that.

All that build up: “There’s something untoward going on here,” “There’s something pushing this other than the fact that the plaintiff feels he was constructively dismissed,” “There’s concerns lurking in the back” and then:

“That’s all I have to say about that.”

And that was actually all he had to say. He rested case without giving the court a clue as to what this dark “something” was, like he was narrating the world’s worst film trailer (“In a world where SOMETHING is seriously untoward…That’s all I have to say about that”).

What I have to say about that, after sitting through four days of testimony, is that it was kind of a let down.

But that was it, the defense rested.





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