Canadian Lawyer

December/January 2021

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UPFRONT 12 www.canadianlawyermag.com OTTAWA UPDATE NEWS BRIEFS Constructively dismissed executive entitled to bonus Decision will affect 'virtually every executive' as well as many employees' bonuses and other benefits A CHEMIST DEEMED to have been constructively dismissed is entitled to receive the benefit he would have received when the company for which he worked was sold under his notice period, the Supreme Court ruled in October in a decision expected to affect most executives and many employees. In Matthews v. Ocean Nutrition Canada Ltd., a unanimous Supreme Court found that the appellant, who worked for about 14 years for the respondent, had not been given sufficient notice when he was constructively dismissed from his executive position with Ocean Nutrition. A benefit the appellant had enjoyed was a long-term incentive plan, under which a "realization event" such as the sale of the company would trigger payments to employees who qualified under the plan. Had the appellant stayed with the company, he would have been entitled to $1.1 million from the sale of the company. "It's a very happy decision . . . for employees across Canada," says Howard Levitt, a senior No duty of care owed to Mr. Sub franchisees Maple Leaf Foods does not owe a duty of care for pure economic loss to Mr. Sub franchisees resulting from tainted meat sales during a 2008 listeriosis outbreak, the Supreme Court of Canada ruled on Nov. 9 in a 5-4 decision. In 1688782 Ontario Inc. v. Maple Leaf Foods Inc., the Supreme Court upheld an appellate court's finding that a duty to supply a product fit for human consumption was owed to the franchisees' customers rather than the franchisees and found an insufficient proximity between the franchisees and Maple Leaf Foods to result in a duty of care. CBA urges discontinuing political vetting of judicial applicants The Canadian Bar Association has called for the government to be more transparent in making judicial appointments in order to avoid the risk of "partisan taint." In a statement dated Nov. 6, the CBA's president wrote that "[b]y continuing a process that is open to speculation about political interference, the government risks eroding the confidence of the public in the independence and fairness of the justice system itself . . . " While welcoming the federal government's announced changes in 2016 to the appointment process, the CBA recommended discontinuing political vetting of judicial applicants. Corporations not protected from cruel, unusual punishment Corporations cannot benefit from Charter protections against cruel and unusual punishment, the Supreme Court of Canada ruled on Nov. 5 in a unanimous decision with three sets of reasons. In rejecting a Quebec building contractor's Charter claim to have been the victim of such punishment, the Supreme Court found that s. 12 of the Canadian Charter of Rights and Freedoms — which provides that "everyone has the right not to be subjected to any cruel and unusual treatment or punishment" — applies only to living beings. New mandatory requirements for travellers to Canada The federal government will be requiring all entrants to Canada to self-report their health and quarantine arrangements using the ArriveCAN app prior to arrival as of Nov. 21, Ottawa announced on Nov. 2. Travellers will be required to provide ArriveCAN with their travel and contact information, their quarantine plan and a health self-assessment. Upon arrival at a Canadian port of entry, a Canada Border Services agent will verify that the report has been submitted. Failure to have provided the information can result in a fine of up to $1,000. Anti-deprivation rule valid under Canadian common law The anti-deprivation rule is valid under Canadian common law and has not been eliminated, the Supreme Court of Canada found in dismissing an appeal in a corporate bankruptcy case on Oct. 2. In Chandos Construction Ltd. v. Deloitte Restructuring Inc., the court found that a clause in a construction contract contravened the anti-deprivation rule under the common law of bankruptcy. The clause would have required a steel company to forfeit a percentage of the total contract price to a general contractor if the steel company became insolvent.

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