Canadian Lawyer

November/December 2019

The most widely read magazine for Canadian lawyers

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Page 57 of 71

58 LEGAL REPORT WORKPLACE LAW Parties are held to oral settlement agreement Mutual agreement on essential terms will make a severance settlement binding, says Ontario Divisional Court in Bombardier IS AN ORAL agreement binding? Case law has suggested it is; a contract is a contract, even if it's not in writing. In August, the Ontario Divisional Court reinforced this in an employee severance case when it found that mutual agreement on essential terms will make a settlement binding. In Shete, Lada, and Chung v. Bombardier Inc., 2019 ONSC 4083, the court considered whether the parties had reached a settlement agreement even though the three employees, terminated in November 2015, had not signed or returned the termination package documents. The court found: "Employees' counsel expressly stated that his clients would accept the terms of the Dec. 18th [2015] offer, provided Bombardier agreed to pay an additional $2500 [per employee] for legal fees . . . " Bombardier agreed to this in a letter sent to the dismissed employees in April 2016. Three months later, the employees each filed a statement of claim against Bombardier seeking damages for wrongful dismissal. Although a motions judge dismissed Bombardier 's motions for summar y judgment, finding that the April 2016 letters were new offers by Bombardier and not an acceptance of offers made by the employees,

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