In the Ontario Divisional Court decision of Simpson v Global
Warranty1, the issue was the application of a
specific termination clause in an employment contract where the
employer violated the contract in the course of the
termination.
The employer had laid the employee off, and had only paid out
his termination entitlements several months later, when the layoff
became permanent. When the employee sued for additional
amounts, the employer alleged just cause.
At trial, the Ontario Superior Court of Justice had determined
that the employee had been constructively dismissed when he was
laid off, and that the employee had not been terminated for just
cause. On appeal, neither of these conclusions was in
dispute. The only issue on appeal was the quantum of
severance, and in particular whether the employer could rely on the
termination provision in light of its alleged breaches of the
contract, such that the employee was entitled to a longer common
law reasonable
