Westcan Bulk Transport Ltd. v. Stewart, 2005 CarswellAlta 183, 2005 ABQB 97 (Alta. Q.B.)
An Alberta court has ruled that a truck driver who started his own business to take over the route he formerly did for his ex-employer was entitled to do so.
Brent Stewart worked for more than six years for Westcan Bulk Transport. His duties were unique in that he mostly drove asphalt numerous times a week to Emco Limited, a customer only three kilometres away.
Because of the close distance, Stewart essentially set his own hours. He also became the de facto contact between the customers, calculating Emco’s asphalt needs and telling his dispatchers so they could arrange the next day’s deliveries.
In mid-1999 Westcan changed its procedures and Stewart was limited to 25 deliveries to Emco per week. After the changes there were some safety incidents which caused concern at Emco. There was also a small explosion which the technical manager at Emco attributed to tanker contamination. The manager contacted Westcan about it but his phone call was never returned.
The manager approached Stewart and told him he was tired of the Westcan situation and wanted to hire Stewart to do all the asphalt hauling to Emco. Stewart ultimately incorporated his own company, resigned from Westcan, and became Emco’s deliverer of asphalt.
Westcan filed an action against Stewart, claiming he was a key employee who had breached his fiduciary duty to the company; that he violated his duty of fidelity and good faith as an employee; and that he breached a duty of confidentiality.
The Alberta Court of Queen’s Bench rejected these arguments. Stewart had no management responsibility and had no power within the company hierarchy – drivers did not even appear on the organizational chart. Stewart was just “one of the truck drivers at the bottom of the Westcan power structure.”
It was “manifestly ingenious” for Westcan to now claim that the things Stewart did to provide superior service to a customer for Westcan’s benefit somehow elevated him to the status of a key employee.
The court also dismissed as “nonsense” the claim that Stewart had in effect become a “contract administrator” of the Emco route when all he had done was provide good service.
The court acknowledged this case was very similar to Restauronics Services Ltd. v. Forster, in which it was held that an employee in similar circumstances had breached the duty of fidelity and good faith.
The court said Stewart did not cross the line from preparation to competition with his employer when he had general discussions with Emco about starting his own business. More complicated is when Stewart told Emco he would match Westcan’s hauling rates.
The court ultimately determined, however, that this case was not as clear as Restauronics. Stewart did not so much submit a bid as respond to the requests of Emco management. What Stewart did was the minimum necessary to make an informed decision on whether the business opportunity presented by Emco was viable for him to pursue. The court dismissed Westcan’s case.
For more information see:
• Restauronics Services Ltd. v. Forster, [2004] B.C.J. No. 430 (B.C.C.A.)
An Alberta court has ruled that a truck driver who started his own business to take over the route he formerly did for his ex-employer was entitled to do so.
Brent Stewart worked for more than six years for Westcan Bulk Transport. His duties were unique in that he mostly drove asphalt numerous times a week to Emco Limited, a customer only three kilometres away.
Because of the close distance, Stewart essentially set his own hours. He also became the de facto contact between the customers, calculating Emco’s asphalt needs and telling his dispatchers so they could arrange the next day’s deliveries.
In mid-1999 Westcan changed its procedures and Stewart was limited to 25 deliveries to Emco per week. After the changes there were some safety incidents which caused concern at Emco. There was also a small explosion which the technical manager at Emco attributed to tanker contamination. The manager contacted Westcan about it but his phone call was never returned.
The manager approached Stewart and told him he was tired of the Westcan situation and wanted to hire Stewart to do all the asphalt hauling to Emco. Stewart ultimately incorporated his own company, resigned from Westcan, and became Emco’s deliverer of asphalt.
Westcan filed an action against Stewart, claiming he was a key employee who had breached his fiduciary duty to the company; that he violated his duty of fidelity and good faith as an employee; and that he breached a duty of confidentiality.
The Alberta Court of Queen’s Bench rejected these arguments. Stewart had no management responsibility and had no power within the company hierarchy – drivers did not even appear on the organizational chart. Stewart was just “one of the truck drivers at the bottom of the Westcan power structure.”
It was “manifestly ingenious” for Westcan to now claim that the things Stewart did to provide superior service to a customer for Westcan’s benefit somehow elevated him to the status of a key employee.
The court also dismissed as “nonsense” the claim that Stewart had in effect become a “contract administrator” of the Emco route when all he had done was provide good service.
The court acknowledged this case was very similar to Restauronics Services Ltd. v. Forster, in which it was held that an employee in similar circumstances had breached the duty of fidelity and good faith.
The court said Stewart did not cross the line from preparation to competition with his employer when he had general discussions with Emco about starting his own business. More complicated is when Stewart told Emco he would match Westcan’s hauling rates.
The court ultimately determined, however, that this case was not as clear as Restauronics. Stewart did not so much submit a bid as respond to the requests of Emco management. What Stewart did was the minimum necessary to make an informed decision on whether the business opportunity presented by Emco was viable for him to pursue. The court dismissed Westcan’s case.
For more information see:
• Restauronics Services Ltd. v. Forster, [2004] B.C.J. No. 430 (B.C.C.A.)
