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Murray v. Kubota Canada Ltd. Between Lynn Murray, plaintiff, and Kubota Canada Ltd. and Crown Life Insurance Company, defendants Court File No. 96-CU-100656 Ontario Court of Justice (General Division) Greer J. Heard: October 15 and 16, 1998. Judgment: January 13, 1999. Counsel: Simon Shields, for the plaintiff. Jeffrey Simpson, for the defendant, Kubota Canada Ltd. No counsel mentioned for the defendant, Crown Life Insurance Company. -------------------------------------------------------------------------------- 1 ????GREER J.:-- The Plaintiff, Lynn Murray, ("Murray") was an employee of Kubota Canada Ltd. ("Kubota") from July 13, 1981 to September 25, 1995, when, she says, her employment was wrongfully terminated by Kubota. Murray began working as a cashier for Kubota at the age of 18 years, having completed her Grade 11 education. When she was terminated, Murray's position with Kubota was that of a retail finance and credit administrator earning $42,420 per year plus benefits which were worth $4,631.40 per year. It is her evidence that she supervised, on the average, 5 to 6 employees whose efforts she co-ordinated. Murray also says that she reviewed contracts, did a high volume of computer work that involved analysis, reviewing amortization schedules and reviewing the work of those who were under her supervision. 2 ????Kubota is a subsidiary of a Japanese company which manufactures agricultural and construction equipment. That equipment is distributed through a network of about 100 dealers throughout Canada. It is Murray's evidence that the financing of this equipment is done much like that of GMAC financing. Murray says she would review the equipment contracts made monthly by Kubota, and that the financing of these contracts would be sold to the bank. 3 ????At the opening of her Trial against Kubota for wrongful dismissal, Murray amended her Statement of Claim by withdrawing all claims against Crown Life Insurance Company ("Crown") and deleting paragraphs 20-34 against Crown, as she had settled her claim against it. She further deleted paragraphs 35 and 36 thereof, being alternate relief claimed by her against Kubota for mental distress and punitive damages. 1.? Murray's health problems 4 ????It is Murray's evidence that at the beginning of 1995, she began to have health problems where she felt overtired and not very energetic. Her food sensitivities and allergies worsened, and this was accompanied by dizzy spells, nausea, pain in her bones, and swollen lymph nodes in her neck and arms and groin. Murray further developed neck pain, migraines, hives and carbuncles, all leaving her constantly weak and feeling like she had not slept. Her vision would come and go, she was overly sensitive to light, had abdominal pains at time, had some trouble breathing, and her sense of smell and taste became very acute. I accept Murray's evidence in this regard. 5 ????Murray tells the Court that she was diagnosed as having an immune deficiency and chronic fatigue and multiple chemical sensitivities. She says that the smell of perfume became a trigger for her and that she had problems when she had to breath diesel fumes. All of these problems seriously affected her daily living so that she physically did not have the strength to do strenuous tasks, and found that she could not perform her daily job functions. 6 ????Murray says that she found that she had short-term memory problems, had trouble recalling certain words, had some cognitive impairment, had difficulty reading and concentrating at home and at work. She admits that she had been a smoker but says that she gave it up in June, 1995, because it affected her well-being. Again, Murray's evidence was presented in a truthful manner, and she seemed deeply saddened about how her health had deteriorated which left her in this difficult position. 2.? Kubota's policies regarding disability and illness 7 ????Kubota's "Personnel Handbook" was published in May of 1995. It comprises 6 chapters, including chapter 4. entitled "Kubota's Commitment to You". Paragraph 4.6 covers short-term disability and illness. It reads as follows: This benefit gives you income protection when you are away from work, because of illness or injury, for three (3) consecutive days or more. Benefits during this period will be paid at 100% of regular salary, beginning with the third consecutive day but limited to a maximum of fifteen (15) days in any calendar year. To receive payments under this plan, satisfactory medical evidence must be provided. The wording of this paragraph is quite clear and unequivocal. It states that, "... satisfactory medical evidence must be provided." Such evidence, in my view, would have to be satisfactory to the company before it would be prepared to commence payments for illness or disability. 8 ????These benefits were combined with Kubota's Group Insurance Plan, which covered extended health care benefits. Employee long term disability income benefits are set out in a schedule in that booklet. The insurance payable is 70% of the employee's monthly earnings, subject to a "maximum of $6,000". There is a waiting period of 119 days before payments begin. The payments are subject to certain conditions which the insurer, Crown Life, imposes and which are set out in the booklet. 9 ????It is Murray's evidence that she raised the issue of her disability with her employer in May of 1995, and spoke to Costa Nicolaidis ("Nicolaidis"), the Manager, a month later about her problems with chemicals. Murray says that her doctor told her to take two months sick leave. In addition, Murray also spoke to the Personnel Manager, Keiko Hayahara ("Hayahara") about obtaining a medical form for her doctor to fill out. Murray says that she was told that there was no such form, only a long term disability form, so that she should just obtain a letter from her doctor. Murray's evidence is that she was told by Nicolaidis that she could not leave work on disability without the permission of the executive committee since there was no one who could replace her in her new position. 10 ????Murray took medical leave from the company on June 20, 1995, without Kubota's consent. Murray says that her doctor had wanted her to leave at the beginning of the month but she did not due to Nicolaidis' "callous attitude". She says that she "felt locked into a corner ... squeezed at both ends." 11 ????In retrospect, it would have served the company well had it given Murray the letter she says she needed to take to the doctor, and it would have served Murray well if she had paid more attention to the wording of the company's policy about the need for reasonable medical evidence before the disability leave would be approved. It is her further evidence that Nicolaidis "freaked on the phone" and told her she could not leave, and that he called her at home on June 21, 1995 and was angry and yelled at her and told her she must have a medical note for the next day. On June 25, 1995 Murray wrote to Hayahara and enclosed a copy of her own job description, a schedule of additional time, and a note from Dr. S. Kara-Shariff, dated June 23, 1995, stating that Murray required 2 months absence as of June 20, 1995. She apparently met with Nicolaidis and gave him all of these materials. 12 ????Murray says that she received a call from Hayahara stating that the doctor's note was not satisfactory and that proper medical evidence had to be provided. She then forwarded, on July 7, 1995, a copy of the medical certificate provided by Dr. Bright to assist her to obtain her unemployment insurance. That certificate stated that she suffered from multiple chemical sensitivity, chronic fatigue syndrome and respiratory distress. Hayahara wrote to Murray on July 28, 1995 asking for a detailed description of her "of specific symptoms" of Dr. Bright's diagnosis and an outline by her doctor as to which duties she can or cannot perform due to her disability. Murray responded by letter of August 15, 1995, enclosing a brief description given by Dr. Bright that did not really help clarify anything regarding her condition and the questions the company asked to be answered. Murray further states in her letter that her leave should be extended to September 20, 1995 on Dr. Bright's advice. 13 ????Kubota wrote to Dr. Bright on August 28, 1995 and asked him to answer a number of questions regarding Murray's illness and her ability to do work. I accept Murray's evidence that all of this was adding to her stress level and that found the whole situation upsetting but that she felt she was ready to return to work on September 25. She spoke to Nicolaidis and says she was told to come in earlier as he had to speak to her about a lot of changes. When she spoke to Hayahara, Murray says that Hayahara tried to obtain a guarantee from her that she would not get sick again, and that this "spooked" her. When Murray arrived on the morning of September 25, 1995 she found no one in the Finance Department. Nicolaidis, Hayahara and Bob Hickey ("Hickey"), the company's comptroller, met with her in the company's board room, and Murray says that Hickey told her that she was terminated and that it was effective immediately. When Murray asked what was the reason for her termination, she says Hickey said the company did not have to give a reason. She was handed a termination letter of that date which also noted that she had yet to provide them with satisfactory medical evidence to justify her absence from work. Murray also said that Nicolaidis told her that she had outgrown her position. 14 ????Murray applied for Long Term Disability benefits in November, 1995 through Crown Life, the insurer. At that point, Murray had still not received her short term disability benefits, which were eventually granted in December, 1995. Crown Life refused to pay the long-term disability benefits and Murray took legal action against them, the claim settling about 3 weeks before trial. Kubota issued Murray a cheque in the amount of $2,447.31 on November 20, 1995 for her short-term disability benefits. She had, much earlier, been accepted for UIC sick benefits payments. 3.? Murray's job description, performance and subsequent employment 15 ????It has not been disputed that Murray's job description, as completed by her and produced for Nicolaidis, at his request, is properly described by her in her outline at Tab 3 of the Plaintiff's Book of Documents. Murray received performance appraisals as she progressed through various positions with Kubota. Murray's 1994 performance appraisal shows her as having a rating of 100 out of 120. She received, that year, a performance bonus of $3,634 and a special bonus of $404, with the only comments on the appraisal as "Has potential to perform at a higher level but seems to lack the consistent motivation." Murray also had to complete her own self-evaluation for the company. This self-appraisal is dated November 28, 1994. She rated her performance at 110. Murray noted that she has taken certain courses to upgrade herself and notes how she could increase her level of contribution to the company. 16 ????Murray sees her position with Kubota as that of quasi-managerial, with her supervision of several other employees. On cross-examination, she admitted that she works approximately 7 hours per day, 35 hours per week and did receive some benefits for working overtime, such as time off in lieu of overtime. She agreed that she did not have her own private office at Kubota nor her own secretary and did not evaluate the performances of others and agreed that her position was not that of management, unlike that of Nicolaidis and Hickey. 17 ????Murray further agreed on cross-examination that she had thought of pursuing other careers while at Kubota, but then said "Doesn't everyone?" In my view, it matters not whether Murray considered leaving Kubota at some point to pursue other interests. The issue before me is whether or not, when her employment was terminated by Kubota, she received reasonable notice. 18 ????After her termination, Murray developed a Resume which, in my view, accurately describes her various positions with Kubota over her 14 years with them. It is her evidence, which I accept, that she sent out 332 resumes and received 27 responses to them. Murray attended 15 interviews for new positions (one being a call-back from an earlier interview), but often found that she was not qualified to apply for positions similar to the one she had at Kubota. Murray has now completed her Grade 12 education and is working on a college degree. I am satisfied on Murray's evidence that she properly mitigated her damages by seeking employment. In 1995, Murray's total income was $55,032.52 (including employment income of $46,723.52 and $8,309 received for UIC benefits). Her income dropped in 1996 to $31,467.42 and in 1997 to $31,816.45. Some of this income came from contract positions that Murray obtained through the City of Scarborough. 4.? Was Murray given reasonable notice? 19 ????I am satisfied, on the evidence before me, that Murray was wrongfully dismissed by Kubota on September 26, 1995, the day she returned to work and found no one in her work area and that the notice period offered to her was insufficient under the circumstances. I accept Murray's evidence respecting how she was informed by the Kubota management that she was terminated. In my view, the company handled the situation badly from the beginning of Murray's illness. There was no evidence tendered by Kubota that it took Murray's illness seriously, yet she had been diagnosed as having chronic fatigue and other immune deficiency problems which made it difficult for her to deal with stress and the pressures put on her by Nicolaidis during that period from the end of June to September, 25, 1995. 20 ????On cross-examination, counsel for Kubota tried to make much of a series of letters which were sent by Murray to her physician, Dr. Bright. I have reviewed these letters, the writing of which Murray had assistance with, and other than Murray's anxiety that she have input into what Dr. Bright tells the company and her counsel's letter to Dr. Bright about what questions he should answer which were asked by the company in their letter, there is nothing unusual or untoward in these letters. Even those actions can be understood in light of Murray's illness and her counsel's concern that she obtain rehabilitation, if necessary. 21 ????The company called none of Nicolaidis or Hayahara or Hickey as witnesses to contradict anything that Murray said about her employment with the company, the supervisory work she did for the company, or the circumstances surrounding her termination. Murray acknowledges that she did not have a management position such as that of Nicolaidis or Hayahara, but I am satisfied on her evidence, which was not contradicted, that she played a supervisory role in the company and had responsibilities that were beyond those of a 9 to 5 hourly employee. It is quite clear that Murray was promoted several times over her 14 year period with Kubota and her appraisal performance was, in my view, more than satisfactory. I am satisfied on Murray's evidence that she did her best to mitigate her damages. The onus is on the defendant to prove failure to mitigate and Kubota called no evidence. 22 ????Murray's situation is similar to that of the plaintiff in McKay v. Eaton Yale Ltd. [1996] O.J. No. 3982, Court File No. 95-CU-95783, in that she had virtually spent all her working career with the defendant, having had only a high school background and obtaining on-the-job training which gave her expertise in the area she was working in when she was terminated. 23 ????It is given that the reasonableness of the notice given to an employee who has been terminated, must be decided with reference to the particular case. It has been held to be a standard, not a rule. See: Bardal v. Globe & Mail Ltd., [1960] O.W.N. 253, 24 D.L.R. (2d) 140 (H.C.J.) and Cronk v. Canadian General Insurance Co. (1995), 25 O.R. (3d) 505 (Ont. C.A.). The factors to be considered, as set out in the case law, include the character of the employment, the length of service with the company, the employee's age, the availability of similar employment having regard to that employee's experience, training and qualifications. Murray was 32 years of age when her employment was terminated. She had no other experience than that with Kubota. I am satisfied that, given her limited amount of formal education, she was not considered by prospective employers for positions of the type she held at Kubota. Murray, quite properly after coming to this conclusion, went back to school and obtained her high school diploma and is looking at furthering her education, albeit in a different field. Further, Murray's skills were particular to her workplace and she performed her job well. It was Murray, herself, who had to determine her own job description while she was in the throes of her illness, due to the company's failure to have a proper job description of her so-called new position. 24 ????There is no question that Kubota was free to dismiss Murray as an employee provided that reasonable notice of termination was given. See: Wallace v. United Grain Growers Ltd. (1997), 152 D.L.R. (4th) 1 (S.C.C.). Although, no documented evidence was led or provided to show how Kubota calculated its severance, Murray admits that Kubota offered her a severance package which was not acceptable to her. Exhibit 9 is the company's calculation of how it calculated the sum of $21,213 on account of what was owing to her, that is, 8 weeks statutory notice and 14.25 weeks of severance pay plus her vacation pay of $2,121.30. Given that Murray had worked for the company for 14 years and 2 months, and given her supervisory tasks and the extent to which the company relied on her skills in her new position, I am satisfied that the appropriate notice period is 11 months. I am not convinced that Kubota acted in bad faith in the manner it dismissed Murray. In my view, there was a breakdown in communication between Murray and Nicolaidis and Hayahara, and a failure on Dr. Bright's part to quickly respond to what was being asked of him and to elaborate in some detail as to Murray's medical problems. 5.? Damages 25 ????What then are Murray's damages? At the date of her dismissal, Murray was earning $42,430 per year plus benefits. In her cross-examination, Murray admitted that she was not claiming the company's contribution to her pension plan. Murray is therefore entitled to the 11 months at $3,583 per month for a total of $38,894 plus the appropriate vacation pay, plus 11 months of benefits at $385.95 per month for total amount of $4,245.45 for benefits. I therefore award Murray the total sum of $43,431.45 plus the appropriate vacation pay, less the amount already paid on account to her, less any income she earned during that period. If the parties cannot agree on the appropriate figures, I may be spoken to. 26 ????There is an issue as to whether there should be deducted from the amount so awarded to Murray, the sum of $5,000 being the settlement she entered into with Crown Life with respect to her claim for long-term disability or set off against her costs. It is Murray's position that I should apply the reasoning of the New Brunswick Court of Appeal in Corbin v. Standard Life Assurance Co. (1995), 15 C.C.E.L. (2d) 71 in which the Court held at pp. 76 and 77 that the employee was terminated while on disability leave, yet the Manager said he did not know why the employee was absent for such extended periods, despite the medical reports the Company received. I do not think that is the case at bar. Murray was terminated upon her return to work while Crown Life was denying her disability benefits. In the recent case of Her Majesty The Queen in right of the Province of British Columbia v. Ossie Sylvester [1997] 2 S.C.R. 315 (S.C.C.), an employee was terminated while receiving disability benefits. The employer had offered that employee a package where the disability benefits were to be deducted from the amount of the package so offered. On appeal from the trial judge's award of 15 months less the disability benefits payment, the British Columbia Court of Appeal allowed the appeal and awarded damages equivalent to 20 months salary and found that the employee was entitled to keep the benefits received during the period. On appeal to the Supreme Court of Canada, the Supreme Court found that the disability benefits should be deducted from damages, thereby treating all employees, whether receiving disability or not, equally. I adopt the reasoning in Sylvester, supra, and order that the $5,000 disability payment given to Murray in settlement of her claim against Crown Life should be deducted from the quantum which I have awarded her. 27 ????If the parties cannot otherwise agree on the issue of Costs, I may be spoken to. GREER J. |
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