Advisor went to Supreme Court of Canada after appeal court reduced $2.2 million in wrongful dismissal damages to $600,000
An Alberta financial advisor has had his bid for $1.6 million in wrongful dismissal damages denied by the Supreme Court of Canada.
Kurt Soost was an investment advisor for Merrill Lynch, who was recruited from a competitor by Merrill Lynch’s predecessor in the summer of 1998. In the spring of 2001, Merrill Lynch fired Soost for cause, claiming he had failed to comply with industry standards. Soost found new employment as a financial advisor about three weeks later, but only a small portion of his client base — worth about $150 million at the time of his dismissal — followed him.
Soost sued Merrill Lynch for wrongful dismissal and sought damages for, among other things, the loss of his clients. In October 2009, the Alberta Court of Queen’s Bench awarded him $600,000 for one year’s pay in lieu of notice as well as an extra $1.6 million in bad-faith damages for the way he was terminated and the damage it potentially caused his career by not giving him an opportunity to improve or act to protect his reputation. In his position as an investment advisor, being terminated for cause and without notice was so devastating to Soost’s book of business that one year’s earnings was insufficient to compensate him, said the court.
However, last summer, the Alberta Court of Appeal overturned the $1.6 million extra award while upholding the one year’s pay in lieu of notice. The appeal court found the employer had the right to dismiss an employee who was hired for an indefinite period at any time as long as adequate notice, or pay in lieu of notice, was provided. There might be sound reasons for the dismissal, such as an economic downturn, but the reasons can also be “whimsical” or “inexplicable,” as long as proper notice or pay in lieu of notice is provided, said the appeal court. The appeal court equated the extra damages as “double counting” for pay in lieu of notice.
Soost vowed to fight on, taking his case to the Supreme Court of Canada. However, last week Canada’s top court rejected his arguments and denied leave to appeal.
