Palumbo v. Research Capital Corp., [2002] O.J. No. 4475 (Ont. S.C.J.)
Palumbo was hired by Research Capital Corp. (RCC) in September 1993. Palumbo argued he was hired to be the head of the corporate finance department, while RCC denied this to be the case. The court accepted Palumbo’s position and found the evidence overwhelmingly in support of this. Palumbo’s formal title was vice-chair. He was a director and officer of the company and served on the executive management committee.
In 1996 the CEO of RCC, John Walsh, hired Gord Pridham. Pridham’s formal title was vice-chair and director. RCC argued Pridham was hired to be Palumbo’s equal and this was discussed openly with both Palumbo and Pridham. It was RCC’s position that Pridham had been hired to be joint head of corporate finance with Palumbo, who was aware of Pridham’s position.
Palumbo denied this was the understanding with respect to Pridham’s role and said he considered Pridham to be his subordinate. The court held RCC hired Pridham to be the joint head of corporate finance, but that Palumbo was unaware of this arrangement.
It eventually became clear the relationship between RCC and Palumbo was not working out. RCC was trying to install Pridham as joint head of corporate finance and oust Palumbo from retaining this position alone. The court found Walsh deliberately took actions to undermine Palumbo’s authority and role as head of corporate finance. In accordance with the contract between RCC and Palumbo, the court held RCC could not assign any duties it chose to Palumbo. The duties assigned had to be consistent with Palumbo’s role as head of corporate finance.
Therefore RCC’s removal of Palumbo as the sole head of corporate finance and demotion to sharing this role constituted constructive dismissal. Accordingly the court held Palumbo’s employment had been terminated without cause and he was entitled to damages in accordance with the employment contract of a lump sum amount equal to one year’s average remuneration and an amount equal to one year’s average fees for Palumbo Resources Inc., Palumbo’s company.
Palumbo was hired by Research Capital Corp. (RCC) in September 1993. Palumbo argued he was hired to be the head of the corporate finance department, while RCC denied this to be the case. The court accepted Palumbo’s position and found the evidence overwhelmingly in support of this. Palumbo’s formal title was vice-chair. He was a director and officer of the company and served on the executive management committee.
In 1996 the CEO of RCC, John Walsh, hired Gord Pridham. Pridham’s formal title was vice-chair and director. RCC argued Pridham was hired to be Palumbo’s equal and this was discussed openly with both Palumbo and Pridham. It was RCC’s position that Pridham had been hired to be joint head of corporate finance with Palumbo, who was aware of Pridham’s position.
Palumbo denied this was the understanding with respect to Pridham’s role and said he considered Pridham to be his subordinate. The court held RCC hired Pridham to be the joint head of corporate finance, but that Palumbo was unaware of this arrangement.
It eventually became clear the relationship between RCC and Palumbo was not working out. RCC was trying to install Pridham as joint head of corporate finance and oust Palumbo from retaining this position alone. The court found Walsh deliberately took actions to undermine Palumbo’s authority and role as head of corporate finance. In accordance with the contract between RCC and Palumbo, the court held RCC could not assign any duties it chose to Palumbo. The duties assigned had to be consistent with Palumbo’s role as head of corporate finance.
Therefore RCC’s removal of Palumbo as the sole head of corporate finance and demotion to sharing this role constituted constructive dismissal. Accordingly the court held Palumbo’s employment had been terminated without cause and he was entitled to damages in accordance with the employment contract of a lump sum amount equal to one year’s average remuneration and an amount equal to one year’s average fees for Palumbo Resources Inc., Palumbo’s company.
