Scott Cosman was employed by Paramount Canada’s Wonderland (PCW) in its group sales department for 22 months until his employment was terminated on Dec. 14, 1998. PCW alleged cause for the dismissal relating to “inaccurate and untimely record keeping” and serious and significant discrepancies in his sales-calls activities.
Mr. Cosman brought an action seeking damages for wrongful dismissal against his former employer. In its statement of defence PCW alleged that Mr. Cosman falsified expense reports and activity reports and further alleged breach of fiduciary duty, deceit and misrepresentation in respect of work activities.
The onus was on PCW to establish that the dishonesty was sufficient to create a breakdown in the employment relationship. To fulfill this requirement two questions must be addressed: first, whether the dishonest conduct has been proven to the satisfaction of the Court and, second, whether the nature and degree of the dishonesty warrants dismissal.
The allegations against Mr. Cosman were that he inflated mileage claims by submitting fictitious client visits, he documented fictitious client visits, and he refused to acknowledge these faults when confronted with them on Dec. 14, 1998.
With respect to expense reports covering the months of May through September 1998, Mr. Cosman denied that any of these claims were falsified and stated that he made all of the client visits that he had documented. While he denied any inflation of the mileage entries for his company car, he did acknowledge that his mileage entries were based on estimates, rather than accurate odometer readings.
With respect to his expense reports for 1997, Mr. Cosman acknowledged that he inflated his mileage claims. Mr. Cosman testified that shortly after starting work at PCW, he decided to join the Mississauga Board of Trade at a cost of $300 to foster sales leads. He was informed by the then group sales manager, Greg Robinson, that this expense would not be reimbursed. Mr. Cosman alleged that Mr. Robinson suggested that he inflate his mileage claims to recapture the amount of the membership. At trial Mr. Robinson denied ever making such a suggestion.
The Court held that with respect to the 1998 expense claims there was not sufficient evidence to establish on a balance of probabilities that Mr. Cosman was dishonest in filling out his claims. However, with respect to the 1997 claims the Court held that the conduct of Mr. Cosman was not only dishonest but also criminal. He knew that he was not entitled to receive compensation for his Board of Trade membership fee and he knew that his expense reports had been falsely inflated to recapture this expense. The alleged intervention of his sales manager in this scheme was irrelevant.
Having found Mr. Cosman guilty of misconduct the Court then considered whether the misconduct was so serious that it undermined the fundamental relationship between the parties.
As part of his employment Mr. Cosman was given access to several thousand complimentary entry tickets to PCW each year, valued at $40 each, needed in order to properly function in his employment. Although the amount embezzled by Mr. Cosman through his mileage log was merely $300, this embezzlement destroyed the position of trust that PCW demanded of him. PCW would no longer be able to provide him access to the complimentary tickets in light of considerable potential value on the “black market.”
Having found that the misconduct was sufficient to warrant dismissal the claim against PCW for wrongful dismissal was dismissed. However the Court did accept Mr. Cosman’s claim for damages for a missed cruise that he had been awarded at a ceremony prior to his termination which was valued at $3,224. There was no evidence to suggest an implied term that this award could be cancelled for any reason including embezzlement.
For more information:
• Cosman v. Viacom Entertainment Canada Inc., Ontario Superior Court of Justice, Docket No. 51096/99, April 19/02.
Mr. Cosman brought an action seeking damages for wrongful dismissal against his former employer. In its statement of defence PCW alleged that Mr. Cosman falsified expense reports and activity reports and further alleged breach of fiduciary duty, deceit and misrepresentation in respect of work activities.
The onus was on PCW to establish that the dishonesty was sufficient to create a breakdown in the employment relationship. To fulfill this requirement two questions must be addressed: first, whether the dishonest conduct has been proven to the satisfaction of the Court and, second, whether the nature and degree of the dishonesty warrants dismissal.
The allegations against Mr. Cosman were that he inflated mileage claims by submitting fictitious client visits, he documented fictitious client visits, and he refused to acknowledge these faults when confronted with them on Dec. 14, 1998.
With respect to expense reports covering the months of May through September 1998, Mr. Cosman denied that any of these claims were falsified and stated that he made all of the client visits that he had documented. While he denied any inflation of the mileage entries for his company car, he did acknowledge that his mileage entries were based on estimates, rather than accurate odometer readings.
With respect to his expense reports for 1997, Mr. Cosman acknowledged that he inflated his mileage claims. Mr. Cosman testified that shortly after starting work at PCW, he decided to join the Mississauga Board of Trade at a cost of $300 to foster sales leads. He was informed by the then group sales manager, Greg Robinson, that this expense would not be reimbursed. Mr. Cosman alleged that Mr. Robinson suggested that he inflate his mileage claims to recapture the amount of the membership. At trial Mr. Robinson denied ever making such a suggestion.
The Court held that with respect to the 1998 expense claims there was not sufficient evidence to establish on a balance of probabilities that Mr. Cosman was dishonest in filling out his claims. However, with respect to the 1997 claims the Court held that the conduct of Mr. Cosman was not only dishonest but also criminal. He knew that he was not entitled to receive compensation for his Board of Trade membership fee and he knew that his expense reports had been falsely inflated to recapture this expense. The alleged intervention of his sales manager in this scheme was irrelevant.
Having found Mr. Cosman guilty of misconduct the Court then considered whether the misconduct was so serious that it undermined the fundamental relationship between the parties.
As part of his employment Mr. Cosman was given access to several thousand complimentary entry tickets to PCW each year, valued at $40 each, needed in order to properly function in his employment. Although the amount embezzled by Mr. Cosman through his mileage log was merely $300, this embezzlement destroyed the position of trust that PCW demanded of him. PCW would no longer be able to provide him access to the complimentary tickets in light of considerable potential value on the “black market.”
Having found that the misconduct was sufficient to warrant dismissal the claim against PCW for wrongful dismissal was dismissed. However the Court did accept Mr. Cosman’s claim for damages for a missed cruise that he had been awarded at a ceremony prior to his termination which was valued at $3,224. There was no evidence to suggest an implied term that this award could be cancelled for any reason including embezzlement.
For more information:
• Cosman v. Viacom Entertainment Canada Inc., Ontario Superior Court of Justice, Docket No. 51096/99, April 19/02.
