Executive Summary: Key Legal and Evidentiary Issues

• Termination of a pediatrician's service contract by the Northern Health Authority for refusing a COVID-19 vaccine during the pandemic was found to be a breach of contract by the arbitrator.

• The arbitrator determined that the Provincial Health Officer's vaccine mandate order did not capture Dr. du Plessis's unique situation of providing services exclusively and virtually from his private residence.

• Foreseeability of a mandatory vaccination policy was a central factual finding, as COVID-19 vaccines had been available for months and Dr. du Plessis had already declined vaccination before the 2021 Contract was signed.

• Both the NHA's appeal and Dr. du Plessis's cross-appeal were dismissed because neither party successfully identified a pure question of law arising out of the arbitral awards, as required under s. 59 of the Arbitration Act.

• Contractual interpretation of the without-cause termination provision (Article 3.1) limited damages to six months' notice, rebutting the common law presumption of reasonable notice.

• Dr. du Plessis's attempt to introduce the legal doctrine of repudiation on appeal was rejected, as it was never raised during the arbitration proceedings.

Background and the parties' relationship

Dr. Jannie du Plessis was a pediatrician who had worked for the Northern Health Authority ("NHA") in British Columbia under a series of one-year term service contracts since 1999. By the time of his termination in 2021, he was 73 years old. Each contract classified him as an independent contractor and included an arbitration clause. Following a heart attack and coronary bypass surgery in July 2019, Dr. du Plessis ceased providing on-call and hospital services with the NHA's agreement, and the NHA was satisfied with his level and mode of service delivery. When the Province declared a state of emergency on March 16, 2020, Dr. du Plessis closed his clinic and provided all services to patients virtually via telephone consultations from his private residence, an arrangement the NHA did not take any issue with. In April 2021, the parties renewed the service contract for the term April 1, 2021, to March 31, 2022 (the "2021 Contract"). Notably, this contract did not state that Dr. du Plessis would continue providing services exclusively virtually, nor did it contain any provision requiring or exempting him from obtaining a COVID-19 vaccine. Dr. du Plessis had already declined the NHA's offer to reserve a dose of the vaccine for him in February 2021.

The Provincial Health Officer's vaccine mandate

During the pandemic, the Provincial Health Officer ("PHO") issued numerous orders under the Public Health Act. On October 14, 2021, the PHO issued a vaccine mandate order requiring all health care workers to receive a COVID-19 vaccine. The order was lengthy and complex, containing 29 recitals and five pages of definitions, and was amended on several occasions including on October 21, November 9, and November 18, 2021. The arbitrator determined that the November 9, 2021 iteration was the relevant version (the "PHO Order"). The PHO Order defined "staff member" to include an individual providing care or services "in a care location" under contract with a regional health authority. Key definitions in the order, including "care location," "in a care location," and "work," became central to the dispute. The NHA medical staff were notified on October 15, 2021, that all staff and physicians employed by British Columbia health authorities were required to have a first dose of the COVID-19 vaccine by October 25, 2021. Dr. du Plessis chose not to receive the vaccine because of health concerns related to medication he received for thrombosis and did not apply for an exemption because he understood he would not qualify.

Termination of the 2021 Contract

Dr. Ronald Chapman, Vice President Medicine for the NHA, advised Dr. du Plessis that his service contract would be terminated on November 14, 2021, if, by that date, he had not obtained a first dose of the COVID-19 vaccine or a medical exemption. On November 17, 2021, Dr. Chapman wrote to Dr. du Plessis advising that as he had not applied for an exemption nor received the vaccine, the 2021 Contract had been frustrated and was terminated effective immediately. The NHA contended that the PHO Order required Dr. du Plessis to be vaccinated and that his refusal rendered the contract frustrated by operation of law.

The arbitration proceedings and the Liability Award

Dr. du Plessis commenced proceedings under the Arbitration Act seeking a declaration he had been wrongfully dismissed and damages. The NHA defended the claim maintaining that the 2021 Contract had been terminated by the common law doctrine of frustration and alternatively that Dr. du Plessis had committed a fundamental breach of the 2021 Contract by failing to comply with the PHO Order. The arbitrator bifurcated the damage issue and proceeded to hear the liability issue by a three-day Zoom hearing. In the Liability Award dated September 14, 2023, the arbitrator found that the NHA had breached the service contract in terminating Dr. du Plessis. The arbitrator concluded that the PHO Order, as worded at the relevant time, did not capture Dr. du Plessis's unique situation wherein it was recognized and accepted that he would continue to provide services virtually from his private residence. The order made no reference to virtual care in any of the twenty-four enumerated categories of "care location," and the arbitrator inferred that a "care location" referred to where the patient is receiving the care, rather than where it is being provided from — in this case, Dr. du Plessis's private residence used for virtual services. The arbitrator further found that the implementation of a mandatory vaccination policy or law for health care workers was not so out of the realm of possibility so as to characterize such as reasonably unforeseeable, particularly given that COVID-19 vaccines had been available in British Columbia for four months and over a million doses had been administered when the 2021 Contract was entered into. The NHA's knowledge of Dr. du Plessis's unwillingness to take a vaccine and its deliberate choice not to make vaccination a term of the 2021 Contract weighed against the frustration argument.

The Remedy Award and the WCT provision

In the Remedy Award dated February 16, 2024, the arbitrator concluded that Dr. du Plessis was a dependent contractor and accepted the legal presumption that dependent contractors are entitled to reasonable notice on termination. However, as Article 3.1 of the 2021 Contract (the "WCT provision") clearly and unequivocally provided a six-month notice period for termination without cause, the arbitrator found that the presumption of reasonable notice was rebutted. Applying the WCT provision, the arbitrator found that Dr. du Plessis was entitled to six months' notice for without cause termination and awarded one half of his annual compensation as damages plus costs, totalling $388,582.13. The arbitrator also rejected the NHA's submission that Dr. du Plessis failed to mitigate his loss by obtaining a COVID-19 vaccine, and rejected Dr. du Plessis's claim for aggravated, moral and/or punitive damages, finding that the NHA terminated the contract based on how it honestly and in good faith interpreted the PHO Order.

The appeals before the Court of Appeal for British Columbia

Both parties appealed. The NHA filed notices of appeal from both awards, and Dr. du Plessis filed a notice of appeal from the Remedy Award. The parties agreed to consolidate the two appeals and waived the opposite party's requirement to seek leave to appeal under s. 59(2)(b) of the Arbitration Act. The critical question for both appeals was whether either party had identified a pure question of law arising from the awards, as required under s. 59 of the Arbitration Act to bring the appeals within the Court of Appeal's jurisdiction. On the NHA's appeal, the Court found that the arbitrator's assessment of the frustration defence — including foreseeability and whether the PHO Order was a supervening event — were matters of mixed fact and law, not pure questions of law. The Court held that the interpretation of the PHO Order could not be separated from the frustration analysis as an independent "upstream" question of law, and even if it could, the NHA was unable to demonstrate that the arbitrator erred in law in the interpretation of the PHO Order. The Court also rejected the NHA's claim that the arbitrator considered irrelevant factors, finding that each challenged factor was a legitimate and necessary finding of fact within the frustration analysis. On Dr. du Plessis's cross-appeal, the Court similarly found no extricable question of law arising from the Remedy Award. His argument about repudiation was not raised at the arbitration and therefore did not arise out of the Remedy Award. His challenges to the construction of the WCT provision and the characterization of the dismissal were found to be questions of mixed fact and law, amounting to attempts to seek a different outcome from the arbitrator's contractual interpretation.

The ruling and overall outcome

The Court of Appeal for British Columbia, in a unanimous decision by Justice Butler (concurred in by Justices Riley and Mayer), dismissed both the NHA's appeal and Dr. du Plessis's cross-appeal for want of jurisdiction. The arbitrator's awards were upheld in their entirety. As a result, Dr. du Plessis was the successful party at the arbitration level, having been awarded damages based on six months' notice under the without-cause termination provision of the 2021 Contract, plus costs, totalling $388,582.13. The Court of Appeal's decision preserved this outcome, confirming that neither party had raised a pure question of law sufficient to warrant appellate intervention in the arbitral awards.