Court exercises discretion to refuse to apply estoppel

|Canadian Employment Law Today

From May 1995 until February 2001, Tarpline Products Inc. employed David Stewart as vice-president of sales and marketing. Tarpline sold a tarpauline accessory device invented by the owner, David Langtry. The parties entered into an oral agreement which provided Mr. Stewart with a monthly base salary of $2,500 plus five per cent commissions of sales paid annually. In addition to owning Tarpline, Mr. Langtry was part-owner of two other businesses: Raven Plastics and Raven Metals.

Tarpline was co-located with the Raven companies and Mr. Stewart performed managerial services for both Raven companies in addition to his duties at Tarpline.

Although Mr. Stewart’s terms of employment included payment of commissions annually, he did not receive any commissions while employed with Tarpline. At the end of 1995 Mr. Stewart made his first request for commissions. His commission rate was five per cent. Gross sales for 1995 were $56,018 and Mr. Stewart claimed $2,800. Mr. Langtry asked Mr. Stewart to wait until the following year to collect his commissions because of cash flow issues in the company. Mr. Stewart agreed. This pattern continued until 1999.