Executive Summary: Key Legal and Evidentiary Issues

• Enforceability of a termination clause containing ambiguous and grammatically incomprehensible language, including an unlawful condition requiring execution of a release.
• Whether common law reasonable notice is displaced when successive employment agreements exist and the operative termination provision is void for uncertainty.
• Determination of the correct length-of-service start date where the employer expressly recognized continuity of employment across two agreements.
• Application of the Bardal factors to a 56-year-old senior manager with just under three years' combined service and unsuccessful mitigation over 300 job applications.
• Entitlement to a discretionary bonus during the notice period under a plan requiring active employment, given the employer's financial losses and absence of bonus payments to other employees.
• Threshold for aggravated and punitive damages where the employer cited erroneous performance concerns, dismissed the employee one week before Christmas, and provided only the statutory minimum.

Facts of the case The defendant, Avcorp Industries Inc. dba LateCoere Aerostructures Canada, is a Canadian aerospace company that designs and constructs major airframe structures for clients such as Boeing and Bombardier. In the fall of 2021, the defendant offered the plaintiff, Harman Kular, employment in Vancouver while he was living and working in Toronto. On November 29, 2021, the plaintiff formally accepted and signed an employment agreement (the "First Agreement"), which contained termination provisions (clauses 25 and 26) providing for one month's notice plus one additional month per complete year of service, up to a six-month maximum, with severance compensation in lieu of notice and provisions addressing new employment during the required notice period.

The plaintiff commenced his duties on January 3, 2022 as Director, Supply Chain, overseeing supply chain management across three plants. On May 16, 2022, he received a $20,000 transaction bonus. On January 30, 2023, the defendant informed the plaintiff that his position was being terminated effective April 1, 2023 for performance reasons, and offered him a demotion to Plant Supply Manager with responsibility for a single plant, a downgraded reporting line, and a restructured bonus entitlement. The letter made clear that if the plaintiff did not sign a new agreement, the offer would be withdrawn. The plaintiff was surprised by the performance allegation, as he had not previously been made aware of such issues. Upon his inquiry, the defendant stated that the reference to performance concerns was a mistake. On February 2, 2023, the defendant issued a second letter removing the performance reference and confirming two months' working notice of the elimination of his original position.

On February 13, 2023, the parties entered into a second agreement (the "Second Agreement") under which the plaintiff would begin work in his reduced role on a full-time, indefinite-term basis effective April 1, 2023. Material clauses included a waived probationary period; eligibility for a bonus of 15% (with a stretch target of 22.5%) of base salary determined at the employer's sole discretion; a requirement that the employee be actively employed on the date the bonus was payable (clause 5.4.1); three weeks of annual vacation and 6% vacation pay; and termination provisions in clause 9.2 referencing entitlements under the Employment Standards Act. Clause 9.2.4 required execution of a Full and Final Release in favour of the employer. Clause 9.2.3 recognized the plaintiff's commencement of employment date of January 3, 2022 for purposes of Article 9. The Second Agreement also contained an Entire Agreement clause (10.5) and a severability clause (10.8).

The plaintiff received a $30,000 bonus on May 11, 2023 for the 2022 fiscal year and a $14,816.79 bonus on May 29, 2024 for the 2023 fiscal year. In 2024, the defendant faced financial difficulties primarily due to a strike at Boeing. On December 17, 2024, the defendant dismissed the plaintiff without cause, effective immediately, providing only three weeks' pay in lieu of notice—the minimum under s. 63 of the BC Employment Standards Act. At the time of dismissal, the plaintiff was earning an annual salary of $185,400, was 56 years old, and received extended health and dental benefits, three weeks of paid annual vacation, potential bonus entitlement, and pension contributions equal to 5% of salary.

In the action, the plaintiff sought $264,995.89 based on a proposed 12-month notice period (comprising salary, lost 2024 bonus, future bonus, vacation pay, medical expenses, and pension contributions), $50,000 in aggravated damages, $100,000 in punitive damages, interest under the Court Order Interest Act, and costs.

Procedural ruling (2025 BCSC 2582) On December 17, 2025, Justice Morley heard the parties on whether the summary trial of the $265,000 wrongful dismissal claim should proceed in general chambers in under two hours, as the plaintiff urged, or be adjourned to the long-chambers list as the defendant submitted. Justice Morley acknowledged institutional responsibility for the dysfunctional long-chambers booking system but found that the matter could not be heard fairly in under two hours, that it risked being repeatedly bumped, and that the defendant's willingness to take its position—despite the risk that an adjournment might open up other avenues for the plaintiff including punitive damages claims—confirmed that experienced counsel viewed the matter as requiring more time. The court adjourned the matter and ordered it set down on the long-chambers list, with a direction that priority be given so that it could be heard before the scheduled trial dates.

Summary trial decision (2026 BCSC 794)

Suitability for summary trial Justice Branch found the case suitable for summary disposition under Rule 9-7(15)(a), with no dispute between the parties on this point.

Notice period and the termination clause The defendant argued that the termination clause in the Second Agreement displaced the plaintiff's entitlement to common law reasonable notice. The court found the clause ambiguous and incomprehensible, and therefore unable to displace the implied term of common law reasonable notice. Clause 9.2.2 stated that "in addition to the notice and/or pay in 9.2.1 there will be an additional pay and/or notice," but failed to set out with any clarity what such additional pay or notice was, with the language "shall be equal to one the obligations outlined" being grammatically incomprehensible. Clause 9.2.4 referenced a non-existent "Section 7.2" of the ESA. The court further found that clause 9.2.4's attempt to make the plaintiff's ESA entitlement conditional on the signing of a release exceeded what the ESA requires and rendered the clause null and void.

Applying contra proferentem and the principle that employment law favours protecting the employee, the court rejected the defendant's invitation to apply broad interpretive principles to fix the drafting, finding that doing so would require completely rewriting the clause rather than minor "blue pencil" adjustments. The court also rejected the defendant's alternative submissions that the severability clause should leave the plaintiff with bare ESA entitlement under clause 9.2.1, or that the Court should revert to the First Agreement, noting that the defendant had clearly brought the First Agreement to an end and that the Second Agreement contained an Entire Agreement clause. The termination clause was held void for uncertainty and severed, and the court reverted to the default common law notice approach.

Bardal factors and reasonable notice On character of employment, the plaintiff held a senior leadership role both as Director, Supply Chain and, later, as Plant Supply Manager. On length of service, the court adopted the original start date of January 3, 2022, finding continuity supported by the waived probationary period, the absence of a job application or interview for the new role, the absence of waiting periods for benefits or RRSP participation, and the defendant's own references in early-2023 correspondence to "maintaining" and "continuing" the plaintiff's employment. The plaintiff was 56 years old at dismissal—an age at which finding comparable positions can become more difficult—and had applied for over 300 jobs in the 15 months following dismissal without success. The defendant did not advance a mitigation argument. Considering the case law guidance from both parties (including Wright, Hill, Winterburn, Ellerbeck, Corey, and Mitchell), the court concluded that nine months was a reasonable notice period.

Bonus The plaintiff sought bonuses for his last year of employment and for the proposed notice period under the defendant's Group Management Bonus Plan. The court found no amount was payable, noting only a short history of bonus payments, no evidence that bonuses were necessary to remain competitive, widely varied amounts, a target indicating the bonus was not a major compensation component, and the defendant's financial condition—a net loss of $23.578 million and the fact that no bonus for fiscal 2024 was paid to any employee because the division did not achieve performance targets. The court also held that clause 5.4.1 of the Second Agreement contractually excluded any bonus entitlement during the notice period.

Vacation pay The plaintiff was not entitled to additional compensation for vacation pay during the notice period, as wrongfully dismissed employees are not generally entitled to such compensation absent accrued unused vacation or vacation pay treated as a separately paid-out entitlement on each paycheque.

Medical benefits The plaintiff claimed $4,173.31 in medical expenses incurred in the 12 months following dismissal. Restricting recovery to the nine-month notice period, the court awarded $2,254.31, comprising $26 in directly paid expenses, $1,826.85 paid on top of his wife's benefits plan, and $401.46 for extended coverage obtained after his wife's coverage ended.

Pension The plaintiff sought $9,270 for the 5% pension contribution over a 12-month notice period. Reduced to nine months, the court awarded $6,952.50.

Aggravated damages The court found the defendant's conduct did not meet the standard for aggravated damages. The initial reference to performance concerns appeared to be an innocent administrative error, the demotion was not humiliating in itself (otherwise a great proportion of constructive dismissal claims would attract aggravated damages), there is no "no-go" period for dismissals around Christmas, and the defendant's interpretive arguments were not so offensive as to meet the test.

Punitive damages The court found the high bar for punitive damages was not met, with no evidence of knowing fabrication of misconduct allegations or "hardball" tactics.

Outcome The plaintiff, Harman Kular, was the successful party. The court awarded him pay in lieu of nine months' notice and related benefits, totalling $148,256.81, comprising nine months of base pay at $139,050.00, nine months of 5% pension contributions at $6,952.50, and nine months of medical expenses at $2,254.31, subject to reduction for any three-week notice payment already received by the plaintiff at the time of dismissal. The plaintiff's claims for bonus compensation, additional vacation pay, aggravated damages, and punitive damages were dismissed. The amount of costs cannot be determined from the decisions, as the court directed that if the parties were unable to agree on costs, they may make written submissions on a set schedule.