Friendship does not make one the agent of the other

One employee’s misstatements cannot be held against another employee based on their friendship

Julie Whitecross was employed as a purchasing agent with the Heiltsuk Tribal Council pursuant to a one-year employment contract. Her contract commenced on Dec. 13, 1999. The chief of the band, Robert Germyn, signed an extension of her employment contract for an additional year on Sept. 28, 2000. However the council terminated her employment on Oct. 12, 2000.

Ms. Whitecross sued the council, seeking damages for breach of contract, aggravated damages for the manner in which her employment was terminated and for increased costs because of the allegation of fraud made against her by the council. The council defended the action by arguing that the contract extension was signed in reliance on a fraudulent misrepresentation made by Ms. Whitecross that a verbal commitment to a two-year contract was given to her at the time she was initially hired.

Prior to Ms. Whitecross commencing her employment with the council, there had not been a purchasing agent employed by the council. The expectation for the newly created position of purchasing agent was that the incumbent would train a member of the Heiltsuk Band initially to work as an assistant and then to take over as purchasing agent.

It was anticipated that it would take about two years before a trained assistant would be ready to take over the purchasing agent position. This was discussed with Ms. Whitecross during the course of the interview process.

There were concerns among the community about Ms. Whitecross’ position. Although there was no dispute that Ms. Whitecross was effective in her job performance, it was acknowledged that the council did not adequately inform members of the community and other business entities of the band as to the position of purchasing agent and all that it entailed.

These concerns from the community came to a head at a meeting on Sept. 26, 2000. At that meeting a motion was passed not to extend Ms. Whitecross’ contract beyond its expiry date in December 2000.

The next day Chief Germyn called a special meeting of the council to discuss the status of Ms. Whitecross’ continued employment. Unfortunately few members attended and quorum was not met. Chief Germyn then decided to contact legal counsel to determine if the motion passed by way of vote by 20 members of the band was binding on the council. At this time Robert Bulloch, chief financial officer and manager of the band, raised a concern with Chief Germyn about a commitment made to Ms. Whitecross for two years’ employment.

Chief Germyn directed Mr. Bulloch to obtain legal advice. The advice received was that the band’s motion was not binding and that the commitment made to Ms. Whitecross might put the band at risk. Based on this advice Chief Germyn signed an agreement with Ms. Whitecross on Sept. 28, 2000, to extend her contract by one year.

A number of council members were angry with Chief Germyn for renewing Ms. Whitecross’ employment contract and with Mr. Bulloch for allegedly misrepresenting the nature of the commitment to Ms. Whitecross. The council consulted with legal counsel and determined that Ms. Whitecross’ employment should be terminated immediately and paid out to the end of the first contract. On Oct. 12, 2000, Ms. Whitecross was given a letter terminating her employment.

The band in its defence took the position that Mr. Bulloch was acting as an agent for Ms. Whitecross when he raised the concern about the commitment for a two-year contract with Chief Germyn. The council argued that it was entitled to rescind the renewal contract reached on Sept. 28, 2000, on the basis of fraudulent misrepresentation made to it by Mr. Bulloch as agent for Ms. Whitecross.

The council claimed this despite the fact that Mr. Bulloch was and continues to be the general manager of the band. The basis for this allegation is the fact that Ms. Whitecross and Mr. Bulloch were friends and the fact that Ms. Whitecross rented a room from Mr. Bulloch while she worked for the band. Ms. Whitecross denied telling Mr. Bulloch that she was entitled to a renewal of her contract, only that she had earned a renewal through her job performance.

The Court held that there was no evidence that Ms. Whitecross and Mr. Bulloch conspired to mislead the council by misrepresenting the length of her employment contract. It held that Mr. Bulloch did tell Chief Germyn that he thought the council might have made a commitment to Ms. Whitecross over and above the one-year term in the written contract but that Ms. Whitecross did not tell Mr. Bulloch that she had a two-year commitment. Ms. Whitecross did not make any misrepresentations (fraudulent or otherwise) regarding her employment to the council.

Having found no fraudulent misrepresentation to rescind the September 2000 employment contract, the Court held that Ms. Whitecross was wrongfully terminated under both contracts. Ms. Whitecross was entitled to damages in the amount of the remainder of the contracts, less other income that Ms. Whitecross earned during the remainder of the term of the contracts.

For more information:

Whitecross v. Heiltsuk Nation, 2001 BCSC 1506.

Latest stories