



COURT OF APPEAL FOR ONTARIO

CITATION:

Richards v. Media
    Experts M.H.S. Inc., 2012 ONCA 769

DATE: 20121113

DOCKET: C55742

Simmons, Armstrong and Watt JJ.A.

BETWEEN

Lauren Richards

Plaintiff (Appellant)

and

Media Experts M.H.S. Inc. and Mark Sherman

Defendants (Respondents)

Robert C. Taylor, for the appellant

Andrew C. Lewis, for the respondents

Heard: October 30, 2012

On appeal from the order of Justice Suzanne M. Stevenson of
    the Superior Court of Justice, dated June 15, 2012.

ENDORSEMENT

[1]

The appellant sued her employer, the corporate respondent, for damages
    for wrongful dismissal.  She also sued the executive chairman of the
    corporation (the personal respondent) for damages for the torts of
    intentional and negligent infliction of nervous shock.

[2]

On a rule 21 motion, the motion judge struck out the amended statement
    of claim against the personal respondent as disclosing no reasonable cause of
    action and as having no reasonable prospect of success.

[3]

The material facts in the statement of claim are set out in the motion
    judges reasons.

[4]

The appellant raises a number of issues in this appeal.  However, the
    main argument put before us is that the motion judge erred in her conclusion
    that to permit a claim to proceed against the personal respondent would allow
    the appellant to circumvent a limitation of liability clause in the contract of
    employment between the appellant and the corporate respondent.  The clause in
    question limited a claim for wrongful dismissal to 12 months compensation.

[5]

The personal respondent was not a party to the employment contract. 
    However, the motion judge concluded that the personal respondent took the
    benefit of the clause in question on the basis articulated by the Supreme Court
    in
London Drugs Ltd. v. Kuehne & Nagel International Ltd.
, [1992]
    3 S.C.R. 299.

[6]

In
London Drugs
, Iacobucci J., writing for the majority, stated
    at para. 257:

... I am of the view that employees may obtain such a benefit
    if the following requirements are satisfied:

1.      The
    limitation of liability clause must, either expressly or
impliedly
,
    extend its benefit to the employees (or employee) seeking to rely on it;

2.      The
    employees (or employee) seeking a benefit of the limitation of liability clause
    must have been acting in the course of their employment and
must have been
    performing the very services provided for in the contract between their
    employer and the Plaintiff (customer) when the loss occurred
. (emphasis
    added)

[7]

In our view, both of the above requirements in
London Drugs
are
    met in this case.

[8]

In respect of the first requirement, the appellant negotiated her
    employment agreement with the personal respondent who became her boss.  We
    agree with the submission of counsel for the respondents that the relationship
    was such that the parties could not have contemplated that the appellant could
    make claims against the personal respondent arising from her dismissal that she
    could not make against the corporate respondent.  The limitation clause does
    not make sense otherwise.

[9]

In respect of the second requirement, the material facts pleaded in the
    statement of claim against the personal respondent indicate that he was acting
    on behalf of the corporate respondent when he terminated the appellants
    employment.  The allegation in the statement of claim that the personal
    respondent acted on a frolic of his own is a conclusory statement that does
    not accord with the material facts pleaded and does not convert the actions of
    the personal respondent (as inappropriate as they may have been) into an
    independent tort.

[10]

The
    appellant also argued that the limitation clause should not apply in this case
    because it did not expressly name employees and officers of the corporation and
    was therefore ambiguous and subject to the application of the principle of
contra
    proferentem
.  We do not accept this argument.  For the reasons we have
    explained above, we are satisfied that the parties intended the limitation
    clause to apply to the personal respondent.

[11]

In
    the result, the appeal is dismissed.

[12]

The
    personal respondent shall have his costs on a partial indemnity scale fixed in
    the amount of $15,000, inclusive of disbursements and applicable taxes.

Janet
    Simmons J.A.

Robert P. Armstrong J.A.

David Watt J.A.


