Secure Resources Inc., the employer in a recent Alberta Court of Queen’s Bench decision, had been granted an Anton Piller order as well as an interim injunction against a former employee (Mr. Wilson) who had allegedly – according to the employer – resigned from their position. This was the result of an ex parte application, which means that the court heard submissions only from the employer and not the former employee.
The fact Mr. Wilson had resigned was a key consideration for the court in granting these orders. If there was any doubt that Mr. Wilson resigned, the employer likely would not have obtained the orders they sought. This might be the case where, for instance, the resignation was actually a constructive dismissal.
Following the granting of these orders, Mr. Wilson brought a comeback application. The goal was to dispute whether or not the Anton Piller order and interim junction should have been granted in the first place. After hearing from Mr. Wilson, the court held that it should not have been and consequently overturned their previous orders.
The reason for overturning those orders? The employer’s disclosure on the ex parte application was insufficient. The employer failed to provide a full and fair account of the material events.
The Employer’s Mischaracterization of the Facts
According to the employer, Mr. Wilson resigned after becoming furious over a warning letter related to his performance at work. The employer, in its initial materials to the court, conceded that Mr. Wilson might argue his resignation should instead be understood as a constructive dismissal. The employer explained that Mr. Wilson, without providing details, alleged that the employer failed to pay him wages. The employer claimed that Mr. Wilson did not specify precisely what he was referring to. Based on the above, and as a consequence of Mr. Wilson’s inability to point to specifics, it was clear that Mr. Wilson had resigned.
Providing Clarity: The Evidence of the Employee
Mr. Wilson’s evidence painted a very different story. Despite the employer’s assertions that Mr. Wilson did not provide details and did not specify what pay was owing to him, it was evidence that Mr. Wilson had actually been very specific. As it turns out, the employer failed to disclose to the court a great number of details that came to light through Mr. Wilson’s evidence, including:
- The employer had held back from Mr. Wilson his tonnage bonus, which was an integral part of his compensation in the neighborhood of $60,000;
- Wilson had met with the employer and had outlined very clearly his unpaid-salary and outstanding-bonus concerns;
- The employer ha mischaracterised Mr. Wilson’s salary-related concerns as being vague and unspecific despite Mr. Wilson presenting “crystal-clear accounting of the outstanding salary amounts”;
- The employer, contrary to its suggestion that any salary rollback was “temporary”, offered no evidence to support that claim.
The Court’s Findings: Resignation or Constructive Dismissal?
Based on the above revelations, among others, the court concluded that the employer had tried to portray a clear resignation by making insufficient disclosure, where full disclosure would have given the court “considerable uncertainty” over the issue of resignation and constructive dismissal. Given the “critical importance” of full and fair disclosure on ex parte applications, the court opted to set aside the earlier Anton Piller and injunctions orders.
Although the court did not use this comeback application as an opportunity to actually decide the question of resignation versus constructive dismissal, it is clear to see that the determination of such an issue depends quite significantly on there being adequate and honest disclosure. The employer here, unwisely, attempted to circumvent such a finding by providing dishonest disclosure. This error came back to bite them.