Saskatchewan was in shock when two high-ranking Directors with Saskatchewan Place Association Inc. [SPA], Brian Swidrovich [Swidrovich] and William Antonishyn [Antonishyn], were accused of dishonesty amounting to just cause for dismissal and paid nothing in severance. In effect, SPA’s allegations amounted to fraud, theft, conversion, and dishonesty and insubordination in relation to a business trip taken by both Swidrovich and Antonishyn.

Saskatchewan Place (now called SaskTel Centre) is our largest event centre. By extension, Swidrovich and Antonishyn held high profile positions in the City of Saskatoon due to their work. Swidrovich was the Director of Business Development with SPA while Antonishyn was Director of Ticketing and Business Projects. While this case was likely to be high profile in the first place, it attracted substantially more interest in the public and in the media when SPA contacted the local police and instructed them to pursue a criminal investigation into Swidrovich and Antonishyn’s alleged misconduct. The police investigation took place over a two-year period. The police investigation, paired with the actions of, and the comments made to the media by, the SPA Board Chair, Richard Gabruch [Gabruch], and the new Executive Director of SPA, William Lofdahl [Lofdahl], destroyed the careers and reputations of both Swidrovich and Antonishyn.

While SPA attempted to advance additional allegations, which were unfounded, the case ultimately focused on a business trip to Phoenix, Arizona taken by Swidrovich and Antonishyn in 2011 alongside the outgoing SPA Executive Director, Ken Wood [Wood], and representatives of two SPA clients. The trip was taken in support of building business relations with important SPA business partners: the Saskatchewan Indian Gaming Authority [SIGA] and Law Enforcement Guardians [LEG]. SPA alleged that the trip was improperly authorized and that it served no business purpose thereby making it a personal trip taken at the expense of SPA. Strangely enough, SPA levied these allegations against Swidrovich and Antonishyn despite the fact that their direct supervisor, Wood, had personally authorized the trip. Justice Elson’s decision was ultimately rendered in favour of Swidrovich and Antonishyn, finding that there was no misconduct amounting to just cause for dismissal. Further, Lofdahl had requested that the police perform a criminal investigation of Swidrovich and Antonishyn but when the police ended their investigation both Swidrovich and Antonishyn were vindicated.

Antonishyn had worked for SPA for 22 years when he was dismissed at the age of 62.[1] Swidrovich had worked for SPA for 16 years when he was dismissed at the age of 56.[2]

Facts

During their tenure, Swidrovich and Antonishyn had significantly contributed to the substantial success of SPA. Indeed, the management team had increased the operating revenue from approximately $5.4 million in 2002 to more than $30 million in 2009.[3] The success of SPA was in part due to the development of close business relationships with local businesses due to the impact of the 9/11 terrorist attacks on the entertainment industry. In developing closer relationships with local businesses, Swidrovich engaged LEG (a charitable group of local police officers) to co-sponsor The Man Show (a highly successful trade show featuring content believed to appeal to men). LEG was, at the time, led by Lorne Gelowitz [Gelowitz], a staff sergeant with the Saskatoon Police Service. The success of this shared sponsorship led SPA management to pursue other organizations for similarly sponsored activities including breweries, soft drink bottling companies, Crown corporations and SIGA.[4]

While SPA’s relationship with SIGA started off promising, city council rejected the proposal to have SIGA pay $250,000 a year for a 10-year title sponsorship with the event centre, despite SPA management and their Board of Directors approving it. This rejection by city council significantly impaired the business relationship between SPA and SIGA. There was significant value in keeping a strong relationship with SIGA in no small part due to the significant number, and success, of local casinos operated by SIGA. Over time, Swidrovich developed a positive relationship with Vance McNab [McNab], SIGA’s Vice-President of Marketing, and Gelowitz. As it turned out, McNab and Gelowitz had been long-time friends. The three of them, Swidrovich, McNab, and Gelowitz, began having casual discussions and get-togethers. While this relationship was developing, SPA’s business plan was to take a more aggressive and proactive approach in building client relationships. In fact, SPA spent well below the industry averages on client entertaining for a business such as SPA. Client entertaining could include any number of activities including golf, sports game trips to an out-of-town location, classy dinners, respectable gifts, and more. Naturally, client entertainment involved both business and fun.[5]

In the interest of further developing a strong business relationship with SIGA and LEG, SPA management decided that they would take McNab and Gelowitz on a trip to Arizona. To facilitate this business relationship building, SPA management decided to send Swidrovich, Antonishyn, and Wood on the trip. Wood, as the direct superior to both Swidrovich and Antonishyn not only authorized the trip but encouraged the plaintiffs to attend it. Wood identified that, in addition to building business relationships with LEG and SIGA, the trip also involved the prospect of Saskatoon having a Canadian Football League team and/or a National Hockey League Team.[6] While on the trip, Antonishyn spent time completing work for the SPA and made observations and notes about the stadium where they attended an NFL game. Swidrovich testified that he took numerous notes and photographs relating to his observations. None of the photographs were considered by SPA during their investigation and dismissal of the plaintiffs.[7]

The plaintiffs were ultimately dismissed over the trip to Arizona, despite their immediate superior’s authorization of the trip.

Law and Analysis

Dishonesty and Just Cause

To succeed in an allegation of just cause for dismissal based on dishonesty an employer has to prove the dishonest acts and that those dishonest acts were serious enough to cause a breakdown in the employment relationship. This assessment necessarily involves determinations as to the nature and extent of the misconduct and a consideration of the surrounding circumstances including the employee’s age, employment history, seniority, role and responsibilities as well as the employer’s circumstances.[8] Naturally, SPA was required to prove that the plaintiffs actually engaged in dishonesty in the first place. In this case, Justice Elson found that SPA was required to prove, via “clear, cogent and convincing evidence that it had not expressly or implicitly authorized” the trip to Arizona and “that the plaintiffs knew, or ought to have known this to be so”.[9] SPA failed to prove this first step in the legal analysis and therefore their allegation of just cause failed. Wood, the immediate superior to Swidrovich and Antonishyn, had not only authorized the trip but he also encouraged Antonishyn to attend when Antonishyn expressed some reluctance. Justice Elson found that dishonesty could not be found where there was such “authorization and encouragement”.[10] The plaintiffs had further justification as well, because they had been on similar trips in the past and were not challenged on the legitimacy of those trips. The business’ history therefore also supported the notion that the trip in question was appropriate due to the similarity in circumstances.

The court also noted that the testimonies of Lofdahl and Gabruch differed in their rationale for the plaintiffs’ dismissal. Where Lofdahl’s position was that Wood’s decision to authorize the trip was so far outside his authority that Swidrovich and Antonishyn ought to have known it was not legitimate, Gabruch’s position (and by extension the position of the Board) was that no such authorization from Wood was given.[11] Justice Elson found that Wood did, in fact, give such authorization (thereby dismissing Gabruch’s position) and went on to explain that neither the Board nor Lofdahl had the ability to retroactively apply their own view of SPA policies and “destroy the careers of two longstanding employees in the process”.[12] Even further, Justice Elson found that, even if he was wrong that Wood had not exceeded his authority in approving the trip, there was no evidence that Wood had acted improperly and therefore the plaintiffs could not be found to have acted improperly.[13]

Reasonable Notice

To this day, the test from Bardal v Globe & Mail Ltd. is the process used to guide judges in determining the appropriate period of notice to grant to an employee who is wrongfully dismissed:

There can be no catalogue laid down as to what is reasonable notice in particular classes of cases. The reasonableness of the notice must be decided with reference to each particular case, having regard to the character of the employment, the length of service of the servant, the age of the servant and the availability of similar employment, having regard to the experience, training and qualifications of the servant.[14]

Particular factors of note were that each of the plaintiffs were older employees that held executive positions for a significant period of time.[15] All three of these factors militate in favour of notice periods on the highest end of the spectrum. Swidrovich was thus awarded 20 months of notice while Antonishyn was awarded 24 months of notice. As is standard, the notice period was to include payment of the income and benefits they would have received during that period had they remained employed.[16]

Aggravated, Moral, and Punitive Damages

Interestingly, aggravated, moral, and punitive damages were all denied in this case despite several factors weighing in their favour. The judge’s determination was simply that it was his opinion that the factors did not rise to the level of the kind of bad faith expected for such awards and that the court’s sense of decency was not offended.

Despite the court’s findings, consider that SPA’s accusations could easily be characterized as conversion, theft, and fraud – all highly serious allegations. In fact, fraud is often considered to be the most serious civil allegation one can make against another. From the perspective of criminal law, these allegations take on a much more sinister tone. The evidence in support of all of these allegations was either thin or non-existent. Further, Gabruch had told the media that as a lawyer he would normally recommend to his clients that they not speak to the media while the case was proceeding through the courts, but then he went on to do exactly the opposite and claim that there were absolutely no business reasons for the trip and that the plaintiffs were specifically told they were not allowed to go on the trip, implying Swidrovich and Antonishyn had engaged in conversion, theft, and fraud with respect to SPA and the money that it cost to go on the trip to Arizona and were directly insubordinate in refusing to follow directions by superiors.[17] Justice Elson specifically found that the plaintiffs were not actually told not to attend the trip, and he further found that Wood’s authorization was sufficient, so Gabruch’s comment to the media was in fact false. Further, Lofdahl reported the situation to the police and requested a criminal investigation into the plaintiffs’ actions despite knowing that the plaintiffs’ previous supervisor had both authorized the trip and provided encouragement for the plaintiffs to attend. Even further, Gabruch suspected the plaintiffs were going to take the trip and he believed it to be inappropriate, yet he did absolutely nothing about it between October 12th, when he first had the suspicion, and October 21st when the trip commenced. Instead, he waited until they took the trip and then leapt at them in tandem with Lofdahl and punished them retroactively by dismissing them after the fact. Justice Elson specifically found that, had Gabruch taken action between October 12th and 21st, the trip may never have taken place or alternate arrangements could have been made. I would not expect an employer to be entitled to remain silent on what they perceive as imminent breaches of policy only to leap on the employee after the fact, rather than be up front and advise the employee of the perceived inappropriateness when the suspicion occurred, thereby heading off the potential breach. Despite denying the plaintiffs’ claim for aggravated, moral, and punitive damages, Justice Elson stated that he could not “think of an explanation, consistent with both good faith and good judgment, for the Board chair to have done nothing in the face of his suspicion” and that he was reluctant in finding that SPA’s conduct did not fall within the type of conduct required for an award of moral damages.[18] Given the above described factors and the judge’s admitted reluctance and criticism of the Board chair, it is surprising that no damages were awarded under the moral, aggravated, or punitive heads. It should be noted that the moral, aggravated, and punitive damages portion of the judgment is under appeal to the Court of Appeal of Saskatchewan.

Closing

Since McKinley, allegations of just cause for dismissal have been difficult for employers to maintain. There is good reason for this, given how core employment is to one’s life. Employers should be aware that proper investigations are crucial to administering appropriate punishments and for maintaining just cause at trial. Employers and employees alike should also be aware that older, long term, high ranking persons can be entitled to substantial notice periods in Saskatchewan. While there were no aggravated, moral, or punitive damages awarded in this case, there are many cases where the employer is not so fortunate. As with Gabruch’s own advice that he did not follow, we do not recommend speaking with the media about a case currently before the courts.