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Restrictive Covenants

Clause that required veterinarian to pay former employer if she set up practice in same area enforceable

Jurisdiction: - British Columbia

In Rhebergen v. Creston Veterinary Clinic Ltd., 2014 BCCA 97, the majority of the BC Court of Appeal ruled that a non-compete type clause in an employment agreement that required a veterinarian to pay her former employer prescribed amounts if she set up her own practice in the same area within a three year total period, was enforceable.

The headnote / summary of the case is as follows:  read more »

"Top 10 Employment And Labour Law Cases In 2013" according to Cassels Brock & Blackwell

The law firm of Cassels Brock & Blackwell has issued their, "Top 10 Employment And Labour Law Cases In 2013". 

The cases on their list are set below. Note: the summaries with the cases are mostly my word-for-word cut and paste's from the original article:

1. Communications, Energy and Paperworkers Union of Canada, Local 30 v. Irving Pulp & Paper, Ltd., 2013 SCC 34

The Supreme Court of Canada ruled that random alcohol testing in the workplace is prohibited unless the employer can prove that, in addition to having a dangerous workplace, there are other pressing factors such as an overt substance abuse problem in the workplace.

2. Pate Estate v. Harvey (Township), 2013 ONCA 669

The Ontario Court of Appeal agreed that the Township employer had severely mistreated the dismissed employee, but reduced the punitive damages award from $550,000 to $450,000.  read more »

SCC: Restrictive covenant rules differ depending on whether tied to sale of business or employment contract

In Payette v. Guay inc., 2013 SCC 45,  the Supreme Court of Canada confirmed that the rules applicable to restrictive covenants differ depending on whether the covenants are tied to a sale of a business or to an employment contract. For more information on this case, see my previous entry here: "SCC to hear Quebec case on impact of sale of business, wrongful dismissal on enforceability of non-compete".

 

SCC to hear Quebec case on impact of sale of business, wrongful dismissal on enforceability of non-compete

Jurisdiction: - Quebec

The Supreme Court of Canada announced today that it will hear the appeal in Yannick Payette, Mammoet Canada Eastern Ltd., successor to Mammoet Crane Inc. v. Guay inc. (Que. C.A., Dec. 12, 2011) (34662).

As set out in the Court's summary, the key issue on appeal is whether the Quebec Court of Appeal erred in applying a non-competition clause despite the broad scope of the clause and the wrongful termination of employment relationship in light of the Civil Code regime.

By way of background, the Court's summary states:  read more »

Advertisement in trade magazine, launching of website establish prima facie breach of non-solicit agreement

Jurisdiction: - British Columbia
Sector: - Insurance

In Hub International (Richmond Auto Mall) Ltd. v. Mendham, 2011 BCSC 1780, the BC Supreme Court found that a former employee's advertisement for his new marine insurance company in a trade magazine and the launching of his new company's website established a prima facie breach of the non-solicit agreement he had entered into with his former employer, Hub International.

Specifically, the court stated:  read more »

"Non-Compete Clauses: An International Guide"

Jurisdiction: - United States

Lus Laboris has published a guide entitled, "Non-Compete Clauses: An International Guide" (May 2010).

As set out on their website , the lus Laboris alliance is comprised of member law firms in 42 countries, with coverage in more than 100 countries. Its specialisms include: individual employment contracts; collective redundancies; discrimination; expatriation; restructuring; compensation, benefits and tax; pensions; collective bargaining; workplace policies and handbooks; litigation and dispute resolution; and corporate social responsibility.

The Lus Laboris website describes the guide as follows:  read more »

ONCA allows appeal, grants declaration that restrictive covenant is unreasonable and therefore unenforceable

Jurisdiction: - Ontario - United States
Sector: - Manufacturing

In Mason v. Chem-Trend Limited Partnership, 2011 ONCA 344, the Ontario Court of appeal overturned the application judge's decision and ruled that the following restrictive covenant was unreasonable and therefore unenforceable against a 17 year technical salesperson whose employment was terminated for just cause:

I agree that if my employment is terminated for any reason by me or by the Company, I will not, for a period of one year following the termination, directly or indirectly, for my own account or as an employee or agent of any business entity, engage in any business or activity in competition with the Company by providing services or products to, or soliciting business from, any business entity which was a customer of the Company during the period in which I was an employee of the Company, or take any action that will cause the termination of the business relationship between the Company and any customer, or solicit for employment any person employed by the Company.