In an important decision that came out on May 28, 2010 - Piresferreira v. Ayotte, 2010 ONCA 384 - the Ontario Court of Appeal ruled that employees cannot sue their employers for the tort of negligent infliction of mental suffering, at least in Ontario.

Background

At the time of the incident that led to the termination of her employment with Bell Mobility, the plaintiff, Ms. Pieresferreira, was an Account Manager, had 10 years service, was 60 years olds, and had received mostly excellent performance reviews.

As set out by the Court of Appeal, her supervisor, Mr. Ayotte, was a "critical, demanding, loud and aggressive manager" who was known to "swear at employees, had a temper and would bang his fist on the table to make a point" (para. 5).

In her last year of employment, the plaintiff was subjected to an increasing level of verbal abuse, including yelling, swearing and derogatory comments. It culminated in her being physically pushed away by the supervisor in dispute that ocurred in May 2005. When the plaintiff told the supervisor he should not have pushed her, he responded by telling her, "to get the hell out of my office".

The next time the plaintiff was at the workplace - a week later - the supervisor presented her with a Performance Improvement Plan. The plaintiff refused to sign it, went home and then lodged a formal complaint with the human resources department. She never returned to work again.

She filed a lawsuit against Bell Mobility and Mr. Ayotte in his personal capacity in August 2005. She was subsequently diagnosed with Post-Traumatic Stress Disorder and major depressive disorder. She testified at the trial - which took place some two and half years later - that she was totally disabled from work.

Trial Judge's Decision

In a decision issued on December 3, 2008 (2008 CanLII 67418 (O.N.S.C.)), the trial judge found:

• Mr. Ayotte personally liable for the torts of battery, intentional infliction of mental suffering and negligent infliction of mental suffering; and 
• Bell Mobility to be vicariously liable for the torts committed by Mr. Ayotte and also directly liable for negligent infliction of mental suffering and constructive dismissal.

As a result, the trial judge awarded the plaintiff:

• $500,100 in general damages for the three torts claims and for loss of past and future income;
• $5,100 in special damages relating to medical treatment; and
• $225,000 for the costs of the action and trial.

The judge further determined that the plaintiff was entitled to $87,855 for her wage loss over a 12 month notice period and $45,000 for damages for mental distress in the manner of dismissal. However, the judge did not award damages for these amounts so as to avoid duplicating the tort damages that had been awarded.

The trial judge also concluded that the LTD benefits recieved by the plainitff over the notice period should not be deducted from the damages award.

The trial judge awarded the plaintiff's partner $15,000 under the Ontario Family Law Act as damages for the loss of guidance, care and companionship.

Ontario Court of Appeal

In partially overturning the decision, the Ontario Court of Appeal ruled that:

• the tort of negligent infliction of mental suffering is not available against an employer and supervisor for conduct that occurs in the course of employment;
• on the evidence, the three elements of the tort of intentional infliction of mental suffering had not been made out in this case against the employer and the supervisor; and
• the trial judge had erred, on these facts, in awarding $15,000 to the plaintiff's partner under the Ontario Family Law Act.

The appeal court further ruled, however, that:

• the plaintiff should receive $15,000 in damages for the tort of battery (when that tort was assessed on its own and distinct from the other tort claims); 
• the 12 month notice period should be upheld and the plaintiff should recover her damages over the notice period; and
• the plaintiff should receive the $45,000 in damages for mental suffering from the manner in dismissal under the framework found in Honda Canada Inc. v. Keays, 2008 SCC 39.

The summary below focuses on the appeal court's findings in relation to the tort of negligent infliction of mental suffering.

Negligent Infliction of Mental Suffering

The Ontario Court of Appeal court noted that the trial judge had found Bell Mobility liable for this tort on the basis that that it failed to treat the plaintiff in accordance with Bell Mobility's Code of Business Conduct.

The appeal court then noted that no Canadian appellate court had previously recognized a free standing cause of action in tort against an employer for negligent infliction of mental suffering by an employee.

As such, it stated that it was necessary apply the two-part Anns v. Merton test to determine whether a duty of care arises in these circumstances, such as to allow for this tort.

The court determined that, pursuant to the first part of the Anns test, the employer-employee relationship puts the parties in sufficient proximity to render damages reasonably foreseeable, thereby justifying the imposition of the duty of care. As such, the court stated that it saw no reason "to resist the finding of the trial judge that it was reasonably foreseeable that Piresferreira would experience mental suffering from the abusive manner in which Ayotte supervised her during her employment" (para. 54).

The second part of the Anns test queries whether there are any countervailing policy considerations that dictate that a duty of care should be limited or not recognized.

Pursuant to this part of the test, the appeal court concluded that the following policy considerations foreclose the recognition of a duty of care in the employment context:

• The Supreme Court of Canada strongly intimated in Wallace. v United Grain Growers Ltd., 1997 CanLII 332, that the recognition of such a tort is better left to the legislature(s), not the courts.
• Further, a general duty on employers to take care to shield an employee during the entire course of her employment from acts in the workplace that might cause mental suffering is a far more expansive duty than that rejected in Wallace, which would have only applied at the time of termination and to the manner of dismissal.
• In cases in which the employer's allegedly tortious behaviour includes the termination of the employee, compensation for mental distress is already available under the framework set out by the Supreme Court of Canada in Honda v. Keays. In cases where the employer does not terminate the employee, the employee who is caused mental distress by the employer's abusive conduct can claim constructive dismissal and still have recourse to damages under the Honda v. Keays framework. As such, recognition of this tort is not necessary, as remedies already exist by other means.
• Finally, recognition of such a tort "is undesirable because it would be a considerable intrusion by the courts into the workplace, it has a real potential to constrain efforts to achieve increased efficiencies, and the postulated duty of care is so general and broad it could apply indeterminately"(para. 63).

Conclusion

Three follow-up points:

• The Ontario Court of Appeal's decision significantly reduced the damages owing by the employer. The trial judge had awarded damages of approximately $520,000; the appeal court reduced them to approximately $148,000. 
• According to this article in the June 11, 2010 edition of The Lawyer's Weekly ("Employers can't be sued for negligent infliction of mental distress, says Ontario's top court") the plaintiff will be seeking leave to appeal to the Supreme Court of Canada, particularly as it relates to the appeal court's finding on the claim for intentional infliction of mental suffering.
• The decision in Sulz v. Minister of Public Safety and Solicitor General, 2006 BCCA 582, was not mentioned by the trial judge or the Ontario Court of Appeal. In Sulz, the BC Court of Appeal upheld the trial judge's finding that the tort of neglient infliction of mental suffering had been committed in the employment context and that a $950,000 damages award should stand. Sulz was decided before Honda v. Keays. Further, there was an issue of whether Sulz, as an RCMP member, even had an underlying employment contract. On this basis, it may be possible to distinguish the two cases.