Love Hurts - SCC Refuses Leave To Appeal In Love v. Acuity Investment Management Inc.

Love hurts.

That's how Paul Love is feeling, now that the Supreme Court of Canada has refused his application for leave to appeal the Ontario Court of Appeal's decision in his wrongful dismissal action (Love v. Acuity Investment Management Inc., 2011 ONCA 130). Love hurts despite the fact that the Court of Appeal took the unusual step of increasing Love's period of reasonable notice in his action against his former employer.

Love sued Acuity, an investment management firm, when he was dismissed without cause. He had been a senior vice president and, at the time of his dismissal, was 50 years old with approximately two and a half years of service. He also held two percent equity in the company with his annual compensation including salary, commissions, profit sharing and the value of his shareholdings totalling approximately $633,000. At trial, the judge awarded Love damages based on a five month notice period. Love appealed that finding and the Court of Appeal substituted a nine month notice period. The Court's decision was based primarily on its view that the trial judge over-emphasized one factor (in this case length of service) to the apparent de-emphasis of others (the character of employment including level of position and compensation, and the availability of comparable employment). So Love looked like a winner at the Court of Appeal. Right?

Not so fast. There were also the "small" matters of Acuity's cross-appeal and the issue of costs. The cross-appeal challenged the trial judge's finding that Love was entitled to the value of incremental capital appreciating on his shares ($219,000) plus the value of incremental profit sharing and dividends ($273,000), to the end of the notice period. Acuity argued that the trigger date for Love's obligation to sell his shares back to the company and their valuation occurred when his employment ended, and not at the end of the notice period. The relevant provision in the Investment Agreement between Love and Acuity read:

"Subject to paragraph 4 hereof, if at any time:

Love's employment is terminated by Acuity without cause; or Love should cease to be an employee of Acuity by reason of death or disability, ...Love agrees that Acuity shall have the option...to purchase the shares for a purchase price, determined at the date that Love ceases to be an employee of Acuity... ."

In reviewing the trial judge's finding on that issue, the Court of Appeal began by distinguishing the concept of notice of...