May 15, 2018
St-Pierre, Schrager, Healy
Appeals from a judgment of the Superior Court dismissing an action for wrongful dismissal, oppression, and damages and a cross-application for damages. The main appeal is allowed in part and the incidental appeal is dismissed.
The action was brought by one of the three shareholders in a family business following his dismissal and exclusion from the business. The trial judge found that the dismissal was justified and that therefore, there were no grounds for oppression.
The dismissal was indeed justified. However, it was not open to the judge to transpose the civil law analysis that led to that finding to the oppression remedy. Nor could he state that the appellant had the burden of establishing an abuse of right without considering the other elements that may give rise to an oppression remedy. In particular, the judge failed to consider the context of a private family company and the reasonable expectations resulting therefrom. In this regard, in view of the appellant’s complete exclusion from the management of the company, the trivial amount offered by the respondents to redeem his shares and the cessation of dividend payments without valid reasons, the appellant’s reasonable expectations were unfairly prejudiced within the meaning of s. 241 of the Canada Business Corporations Act (R.S.C. 1985, c. C-44). In this context, it is appropriate to order the redemption of the appellant’s shares at their fair value on a going concern basis, less a 5% discount given the appellant’s minority position and the role he played in his exclusion.
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