Failure to disclose amounts to negligent misrepresentation

|Canadian Employment Law Today

Weldon Allison had worked for Noranda Inc. (or its predecessor) since August 1963. In March 1990 his employment was terminated without cause. At that time, Mr. Allison was 53 years of age.

Upon his termination he was given two options for his separation pay. The first option was to receive a lump sum which would terminate his employment as of March 31, 1990, and result in a one-time payment that could be rolled into a tax sheltered retirement plan. The second installment option would have Mr. Allison’s employment continue but with no obligation to work over the next 16 months, at which time he would be 55 years old.

Mr. Allison sought the advice of a life insurance agent who advised him to take the lump sum payment and invest it in mutual funds. Based on this advice, Mr. Allison accepted the lump sum payment which was rolled into an RRSP. He signed a release in favour of Noranda upon acceptance of the lump sum payment.