Hanis v. Teevan et. al.

Hanis v. Teevan et. al. Collection Decisions of the Court of Appeal Date 1998-06-18 Docket numbers C21503 Judges McKinlay, Hilda Margaret; Goudge, Stephen Thomas; Southey, James Bonham Strange Subject Civil Decision Content DATE: 19980618 Court File No. C21503 COURT OF APPEAL FOR ONTARIO McKINLAY, GOUDGE and SOUTHEY (ad hoc) JJ.A. BETWEEN: ) ) EDWARD H. HANIS ) J. M. Roland, Q.C. and Plaintiff ) Ms Laura K. Fric (Appellant) ) for the Appellant (Plaintiff) - and - ) ) W. Niels Ortvid, S.M. Jarrett JAMES J. TEEVAN, ANDREW K. ) and B. D. Edmonds BJERRING, THE UNIVERSITY OF ) for the Respondent, The WESTERN ONTARIO, GLEN HARRIS ) University of Western Ontario WILLIAM TRIMBLE and ) STEWART MCBRIDE ) W. G. Woodward Defendants ) for the Third Party, Gerling (Respondents) ) Global Insurance Ltd. - and - ) ) GUARDIAN INSURANCE COMPANY ) OF CANADA, HERALD INSURANCE ) COMPANY, CRUM & FORSTER OF ) CANADA LTD., GERLING GLOBAL ) INSURANCE COMPANY and KANSA ) GENERAL INSURANCE COMPANY LTD. ) ) Third Parties ) Heard: April 7 and 8, 1998 SOUTHEY J. (ad hoc): This is an appeal by the plaintiff from the decision of Mr. Justice McDermid, dated March 17, 1995, dismissing the claims of the plaintiff arising out of the termination of his employment by The University of Western Ontario (the "University") for cause and without notice on October 16, 1986. The plaintiff had been employed since 1972 as the Director of the Social Science Computing Laboratory (the "SSCL") at the University and as an Adjunct Professor without tenure. The claims against the University were for wrongful dismissal, infringement and other remedies arising out of copyrights in computer software claimed by the plaintiff, damages for inducing breach of contract and a declaration that the University held certain property in trust for him. The claims against the defendants Teevan and Bjerring were abandoned at the opening of trial. The plaintiff did not appeal the dismissal by the learned trial judge of his claims against the other individual defendants. The claim for inducing breach of contract was not pressed in this court, with the result that the appeal related only to the claims for wrongful dismissal and the claims arising out of copyright. The plaintiff was dismissed because of his continued use for his own purposes of the University's computer, allegedly without the consent or knowledge of the University. The reason for discharge was given in a letter from the Dean of Social Science, Denis Smith, dated October 16, 1986. The letter was delivered to the plaintiff shortly after the London City Police had entered his home that morning to execute a search warrant. The reason for dismissal was said to be the continuance of a relationship between the SSCL and Tycho Research Associates Limited ("TRA"), the plaintiff's corporation, in breach of an understanding contained in correspondence between the plaintiff and Dean B. B. Kymlicka in 1981 that such relationships would be terminated. The letter of dismissal concluded with the words: In accordance with the Personnel Policies of the University, you may request a hearing with a Vice-President and the Director of Personnel (or designate), at which time the reasons for termination may be discussed. A media release from the University the following day said only that the dismissal was the result of an investigation by the University into "procedural improprieties". The release stated that "because the City of London Police Department is continuing an investigation the University can make no further statement on the matter at this time". The plaintiff was subsequently charged in a summons dated March 3, 1987, with a breach of s.301.2(1)(c) (now s.342.1(1)(c)) of the Criminal Code, which provides: 301.2 (1) Every one who, fraudulently and without colour of right, (a) obtains, directly or indirectly, any computer service, (b) by means of an electromagnetic, acoustic, mechanical or other device, intercepts or causes to be intercepted, directly or indirectly, any function of a computer system, or (c) uses or causes to be used, directly or indirectly, a computer system with intent to commit an offence under paragraph (a) or (b) or an offence under section 387 in relation to data or a computer system is guilty of an indictable offence and is liable to imprisonment for a term not exceeding ten years, or is guilty of an offence punishable on summary conviction. The charge, as stated by His Honour Judge W. E. Bell in his reasons delivered orally on October 4, 1988, was: Edward Herbert Hanis is charged that between December 1st, 1985, and October 17th, 1986, at the City of London, he did fraudulently and without colour of right, use or cause to be used, directly or indirectly, a computer system, to wit, VAX-R, VAX-1, and MINI VAX-2 the property of the Board of Governors, University of Western Ontario, Social Science Computing Laboratory, 1151 Richmond Street, with intent to obtain directly or indirectly a computer service, contrary to clause (c), of subsection (1), of Code Section 301.2. On consent, the date of commencement of the alleged offence was changed to December 4, 1985, the date on which s.301.2 was proclaimed. The plaintiff was acquitted by Judge Bell because the Crown had failed to prove beyond a reasonable doubt that the accused had acted fraudulently and without colour of right. I shall have occasion to refer later at greater length to the reasons of Judge Bell. PROCEDURAL FAIRNESS The striking feature of this case is the failure of the University to give any opportunity to the plaintiff before his dismissal to explain his conduct, or, more particularly, to respond to the allegations against him. Unbeknownst to the plaintiff, his use of the University computer had been under investigation by the University and by the police for some months before his dismissal. No explanation was given to the court for the failure to give the appellant an opportunity before dismissal to explain the conduct of which the University complained. I accept the submission on behalf of the University that there is no general duty at common law under which an employer is required to give an employee a hearing before deciding to terminate the employment. Such a duty can arise, however, as a term of the employment contract or because the employee is the holder of an office in which the public has an interest. The plaintiff was originally hired as Director of the proposed SSCL for a 5-year term commencing July 1, 1972, without tenure or promise of tenure. He was a member of the administrative staff rather than a member of the faculty, but was appointed an Adjunct Professor. The learned trial judge held that the purpose of his appointment as Adjunct Professor was to assist him in attracting grants from sources external to the University. The plaintiff built the SSCL from the ground up and played a leading role in its development and management. He applied for and received many valuable research grants. In 1977, the plaintiff's employment contract was extended for another 5 years. In 1982 his appointment was converted to a continuous one, that is, one that need not be renewed every few years. It was recognized in writing by the Vice- President and the Dean of the Faculty of Social Science that the appointment was an administrative staff appointment, but that the appointment as Adjunct Professor was to carry out various academic duties. As to the quality of the plaintiff's work for the University, apart from the use of the University computer for TRA, the learned trial judge made the following findings: There is no suggestion that in any other respect, Dr. Hanis failed to discharge his duties properly. He was energetic, efficient, imaginative and innovative when it came to directing the work of the SSCL. He was a very good administrator and always received an extremely high rating from the various deans under whom he served. In addition, he was active in instruction and research and attracted a great deal of money to the University in the form of research grants. He took pride in the operation of the SSCL and, as evidenced by the highly complimentary report of the SSCL Review Committee, he was quite justified in doing so. The time he spent on TRA activities did not encroach on the performance of his duties as Director of the SSCL. It appears that he and his staff gave priority to the needs of the SSCL over those of TRA. At a hearing in November, 1986, after his dismissal, the plaintiff was informed by Mr. William F. Trimble, Assistant Vice-President of Human Resources, that the personnel policies applicable to his appointment were those contained in a booklet entitled Personnel Policies for Regular, Full-Time Administrative Staff (non-academic), Revised January 1, 1981, which was marked at trial as Tab 11, Exhibit 5. The relevant terms of those personnel policies include the following: B. TERMINATION - DISCHARGE FOR CAUSE 1.00 The University, subject to the provisions of applicable legislation, has the right to terminate employment. 2.00 Except in extreme cases as provided in Part C below, the staff member must be interviewed and given a written warning outlining the problem and stating that continuance of the problem will lead to dismissal. . . . C. SUSPENSION/DISMISSAL 1.00 In extreme cases such as willful misconduct, disobedience or willful neglect of duty, the staff member will be interviewed and suspended from work without pay. 2.00 The case will be considered within three working days and may result in suspension without pay for up to five working days or dismissal without further notice. 2.01 If, upon the case being considered, it is determined that neither suspension without pay nor dismissal is appropriate, the staff member will not lose pay. 3.00 In all such cases, the Director of Personnel or designate must be notified prior to the action being taken. D. HEARING 1.00 In accordance with Section 1.00 of the Grievance Policy, 5 - 15, the reasons for termination are not grievable. 2.00 In cases of termination under Section B & C, individuals may request a hearing with a Vice-President and the Director of Personnel (or designate), at which time the reasons for termination may be discussed. It is clear that the University failed to follow the Personnel Policies respecting termination. No warning was given to the plaintiff under Article 2.00 under Heading B. If the case was an extreme one to which Heading C applied, the University failed to interview the plaintiff, as required by clause 1.00 before suspending him from work without pay, and failed to give the case consideration within three working days as required by article 2.00 under heading C. In my opinion, the Personnel Policies were part of the plaintiff's contract of employment. By failing to comply with them, the University committed a breach of contract. Before considering the legal effect of the breach of contract, I turn to the plaintiff's claim to procedural fairness as holder of an office in which the public has an interest. I am unable to accept Mr. Ortvid's submission that the plaintiff did not hold an office. The appropriate definition of "office" in The New Shorter Oxford English Dictionary (1993) is: A position or place to which certain duties are attached, esp. one of a more or less public character; a position of trust, authority, or service. The appropriate definition of "office" in Webster's New World Dictionary of the American Language, Second College Edition, (1976) is: a position of authority or trust, esp. in a government, business, institution, etc. (the office of president). There is no doubt that the plaintiff was in a position of authority and trust. He used his own ideas and skills in setting up the SSCL. The way in which he did so was not governed by detailed instructions received from a person in authority over him. His responsibility was to achieve a goal for the University, and he discharged that responsibility with considerable success. The University is a statutory body continued by the University of Western Ontario Act, S.O. 1982, c.92. It is financed in part by public funds. In Knight v. Indian Head School Division No. 19 (1990), 69 D.L.R. (4th) 489, the Supreme Court of Canada dealt with a claim for wrongful dismissal arising out of the dismissal of the respondent Knight with 3 months' notice from his employment with the appellant school board as its director of education. L'Heureux-Dubé J., delivering the majority judgment, in which Dickson CJC, La Forest and Cory JJ. concurred, held that the respondent could be terminated even with just cause upon 3 months' notice pursuant to a provision in the employment contract. She went on to consider the question of procedural fairness, commencing with the following observation, in part, at p.499: 2. Procedural Fairness The conclusion that the respondent's employment could be legally terminated without a showing of just cause does not necessarily entail that the procedure involved can be arbitrary. There may be a general right to procedural fairness, autonomous of the operation of any statute, depending on consideration of three factors which have been held by this court to be determinative of the existence of such a right: Cardinal v. Director of Kent Institution, [(1985), 24 D.L.R. (4th) 44] ... It should be noted at this point that the duty to act fairly does not depend on doctrines of employment law, but stems from the fact that the employer is a public body whose powers are derived from statute, powers that must be exercised according to the rules of administrative law. L'Heureux-Dubé J. began her analysis at the top of p.500: A. General duty of fairness The existence of a general duty to act fairly will depend on the consideration of three factors: (i) the nature of the decision to be made by the administrative body; (ii) the relationship existing between that body and the individual; and (iii) the effect of that decision on the individual's rights. This Court has stated in Cardinal v. Director of Kent Institution, supra, that whenever those three elements are to be found, there is a general duty to act fairly on a public decision-making body (Le Dain J. for the Court at p. 653). ... A decision of a preliminary nature will not in general trigger the duty to act fairly, whereas a decision of a more final nature may have such an effect: Dussault and Borgeat, p.372. In the case at bar, the decision made by the appellant board was of a final and specific nature, directed as it was at terminating the employment of the respondent. As such, the decision to dismiss could possibly entail the existence of a duty to act fairly on the part of the appellant board. As to the second element, she said: (ii) The relationship between the employer and the employee The second element to be considered is the nature of the relationship between the board and the respondent. In an oft-cited decision of the House of Lords, Ridge v. Baldwin, [1963] 2 All E.R. 66, Lord Reid classified the possible employment relationship between an employer and an employee into three categories (at pp. 71-2): (i) the master and servant relationship, where there is no duty to act fairly when deciding to terminate the employment; (ii) the office held at pleasure, where no duty to act fairly exists, since the employer can decide to terminate the employment for no other reason than his displeasure; and (iii) the office from which one cannot be removed except for cause, where there exists a duty to act fairly on the part of the employer. These categories are creations of the common law. They can of course be altered by the terms of an employment contract or the governing legislation, with the result that the employment relationship may fall within more than one category: see N.S. Government Employees Ass'n v. Civil Service Com'n of N.S. (1981), 119 D.L.R. (3d) 1 at p. 9, [1981] 1 S.C.R. 211, 43 N.S.R. (2d) 635 sub nom. Wilson v. Civil Service Com'n of N.S., per Laskin C.J.C. for the majority. ... I find, however, that this is not a case of a "pure master and servant" relationship but that it has on the contrary a strong "statutory flavour", so as to be categorized as an office: Wade, Administrative Law, 5th ed. (1982), at pp. 498-9; Malloch v. Aberdeen Corp., [1971] 2 All. E.R. 1278 (H.L.) at p. 1294, per Lord Wilberforce. Being an office, the respondent's situation would fall into one of the last two of Lord Reid's categories. As I have already analyzed the employment contract and the Education Act with regard to the question of whether the respondent could be dismissed only for cause, and concluded in the negative, the employment relation existing between the respondent and the appellant board would fall into the second of Lord Reid's category, i.e., an office held at pleasure. I find, however, that this conclusion does not ineluctably lead to the conclusion that the appellant board was not under a duty to act fairly, as may seem to flow from the judgment of the House of Lord in Ridge v. Baldwin, supra. Administrative law has evolved in recent years, particularly in the Canadian context, so as to make procedural fairness an essential requirement of an administrative decision to terminate either of the last two classes of employment described by Lord Reid. She quoted from Laskin CJC in Nicholson and Lord Wilberforce in Malloch v. Aberdeen Corp. and proceeded at p.503: ... There is thus in England no longer an automatic exclusion of the rule of procedural fairness for employment falling into Lord Reid's second class. The justification for granting to the holder of an office at pleasure the right to procedural fairness is that, whether or not just cause is necessary to terminate the employment, fairness dictates that the administrative body making the decision be cognizant of all relevant circumstances surrounding the employment and its termination (Nicholson, supra, pp.682-3, per Laskin C.J.C.) One person capable of providing the administrative body with important insights into the situation is the office-holder himself. ... In both the situation of an office held at pleasure and an office from which one can be dismissed only for cause, one of the purposes of the imposition on the administrative body of a duty to act fairly is the same, i.e., enabling the employee to try to change the employer's mind about the dismissal. The value of such an opportunity should not be dependent on the grounds triggering the dismissal. She concluded at p.505: I conclude accordingly that the characterization of the respondent's employment as an office held at pleasure is not incompatible with the imposition of a duty to act fairly on the part of the appellant board. As to the third element, the impact of the decision on the employee, she said at p.505: This point can be dealt with summarily. There is a right to procedural fairness only if the decision is a significant one and has an important impact on the individual. Various courts have recognized that the loss of employment against the office-holder=s will is a significant decision that could justify imposing a duty to act fairly on the administrative decision-making body. In my judgment, all three of the elements necessary to give rise to a duty to act fairly existed in the case at bar. The decision of the University was final and specific. The appellant held an office and the decision to terminate the employment of the appellant was of great significance to the appellant. The appellant, in my opinion, was entitled to procedural fairness in connection with the decision to dismiss him. He did not receive procedural fairness, because he was given no opportunity before termination to answer the allegation of breach of trust made against him. The learned trial judge recognized the appellant's right to procedural fairness, but found that it was in conflict with the University's right to dismiss the appellant for the breach of fiduciary duty of which the learned trial judge had found the appellant guilty. He asked himself which right should prevail, and concluded that it should be that of the University, because of the continuing and surreptitious nature of the breach of duty in the face of ample warning that he should cease the conduct involved in the breach, and because the University was entitled to rely on evidence of breach of duty acquired after the dismissal. With respect, the learned trial judge erred in holding that the rights of the appellant and the University were in conflict. Both rights could have been given effect to if the University had given the appellant an opportunity to respond to the accusations against him before dismissal. As was pointed out by L'Heureux-Dubé J. in the Knight case, one of the purposes of imposing procedural fairness is to enable the employee to try to change the employer's mind about dismissal. For the foregoing reasons I am satisfied that the dismissal of the appellant without notice and without a hearing was void on either or both of two grounds, namely, the dismissal was in breach of the appellant's employment contract, and the appellant did not receive the procedural fairness to which he was entitled. The next question is whether the unlawful nature of the discharge is of any significance in this case in which the learned trial judge found that there was just cause for dismissal. Although counsel for the appellant took issue with the onerous nature of the duty found to exist, we were not asked to retry the issue of cause. Does the finding of the learned trial judge mean that the breach of contract by the University and its failure to observe procedural fairness are of no legal significance, because the appellant could have been dismissed in any event. In my judgment, the answer to that question must be "No" in the circumstances of this case. The right of which the appellant was deprived was that of having the opportunity, before his employment was terminated, to persuade the University that he should not be dismissed. the learned trial judge on the issue of cause should be reversed on the merits, it is not clear to me that the appellant might not have persuaded the University to stay its hand, if he had been given the opportunity prior to dismissal to present his case. That opportunity might have been given to him in the interview required under the Personnel Policies or in some other type of hearing sufficient to give procedural fairness. The case against the appellant was not open and shut and it certainly was not a simple one. The trial judge pointed out that the trial consumed 64 days, that 19 witnesses testified, many of them at great length, and that the nature of the claims was complex and varied. Counsel for the University submitted in this Court that the case was overwhelmingly fact driven, that much of the evidence was in conflict, and that the factual scenario depended upon findings of credibility. The trial judge reached an unfavourable conclusion regarding the credibility of the appellant. He said: This is perhaps a good point at which to comment on Dr. Hanis' testimony generally. I found that many times he was not forthright in describing important events. He was often self-servingly selective in his recall of events and withheld important information during his direct examination, which was extracted only with some difficulty on cross- examination. He was often evasive on cross- examination and admitted matters damaging to his position grudgingly and only after extensive questioning and after being confronted with some documentary evidence that made the maintenance of his position untenable. Even then, he frequently attempted to provide some unpersuasive, self-serving justification. His insistence that by terminating cost recovery project #60001 he had eliminated the source of the potential conflict of interest complained of by senior University administrators defied logic. Usually, he interpreted his rights expansively and his obligations restrictively. In my opinion, on many occasions he either had a distorted view of reality or was deliberately attempting to mislead me. In coming to these conclusions, I have taken into account the fact that Dr. Hanis is, by nature, a stickler for precision. For example, he would not agree to suggestions put to him on cross-examination that did not coincide exactly with his version of events. He was quite entitled to take that position and I do not criticize him for that. However, I do censure his self- serving lack of forthrightness. The finding of the learned trial judge with respect to a critical conversation between the appellant and Mr. W. S. McBride, the University's Director of Finance, as to the nature of the 1961 understanding referred to in the letter of dismissal was that he accepted Mr. McBride's version of the conversation as being more reliable, where it differed from the recollection of the plaintiff. Judge Bell, who presided at the criminal trial, held 5 years before the trial of the civil action, appears to have formed a quite different impression as to the credibility of the appellant. He said, In summary, as counsel put it in his submissions, the accused honestly believed that his work, and the work of the consultants who were employed in the computer laboratory as well as under contract with Tycho, was done within reasonable boundaries of personal use, authorized by the University and for the benefit of the University. After referring to evidence attesting to the honesty of the plaintiff, he concluded at p.25: I'm satisfied the accused is testifying honestly as to his personal impression of the purport of the discussions with Mr. McBride. After an anxious review of all the evidence I am left in doubt, which I consider reasonable, that the accused acted fraudulently and without colour of right. I cannot accept the argument of wilful blindness under the circumstances. The accused may have been careless, but I cannot assign moral turpitude to that carelessness. If the appellant had been heard before dismissal, and the University had assessed his evidence in the same way as did Judge Bell, it is unlikely that he would have been dismissed. I am not satisfied that the hearing after termination under the Personnel Policies, which, according to Mr. Ortvid, did occur in this case, provided an equivalent opportunity to the appellant. Once the decision to dismiss had been made, it would have been more difficult to have it reversed than it would have been to persuade the University not to take the decision to dismiss in the first place. Judge Bell concluded his reasons for acquitting the appellant by quoting as follows form the evidence of Dr. Baldwin: And sir if technical persons working in communication systems in the computer lab are working in their private time on projects that are compatible with their profession, is that seen as a positive or a negative thing? Largely positive. Why is that? It enhances their professional expertise in a variety of ways. It keeps them close to the real world and the application of their theoretical knowledge. He added "I would add that Dr. Baldwin was a member of the University senate council on computers and was in an excellent position to make those informed comments." The evidence at trial in the case at bar was that some use of the University's resources by employees and faculty for their own purposes was accepted. So long as the usage did not interfere with the primary purpose of having the equipment, namely, research and teaching, a modest amount of usage was tolerated. It was a question of degree. In light of the foregoing, I find that the effect of the breach of contract by the University and its denial of procedural fairness, or either one of them, was to render the dismissal wrongful and to cause the appellant to suffer damages which he is entitled to recover from the University. Although the learned trial judge dismissed the action for wrongful dismissal, he assessed the damages for wrongful dismissal as follows: Lost salary and benefits during 18 months following dismissal - less any income earned by the $127,440.66 appellant during the period Loss due to failure to produce pension statements after dismissal $593.88 Loss of business income $30,000.00 Total damages for wrongful dismissal $158,034.54 In respect of the claim for wrongful dismissal, there should be judgment for the appellant for $158,034.54 less any income earned from employment during the notice period of 18 months. If the parties are unable to agree, there will be a reference to determine the amount of that income. COPYRIGHT IN TYCHO/HASP The only issue respecting copyright raised on appeal related to the appellant's claim of copyright in TYCHO/HASP. TYCHO/HASP was a computer software system which enabled multiple users of a mini-computer to obtain computing services from, and exchange information with a remote main frame computer. Mr. Roland made 3 submissions without elaboration in oral argument. Those submissions were: The TYCHO/HASP system was the personal research project of the appellant, notwithstanding the contrary finding of the learned trial judge, because the appellant said it was his personal research project, and it had been accepted as such. The University is estopped from denying the copyright of the appellant in the software, because he had relied on his belief in the existence of copyright while marketing the software over a 10-year period. The appellant had paid approximately $190,000 to his consultants to write the software, and had taken assignments of copyright from them. None of these three points is telling, in my opinion. As to the first, determination of the issue of copyright does not depend on whether or not the system is labelled as the personal research project of the appellant. As to the second, the elements necessary in law for an estoppel were not present. There was no representation by the University and no detrimental reliance by the appellant. As to the third, the appellant received substantial net pecuniary benefit from marketing and servicing the software, despite payments to those whom he described as consultants. The assignments of copyright from them were ineffective, because they themselves had no copyright in the software for reasons to be explained below. I turn then to the points raised in the appellant's factum. The first is that the learned trial judge failed to consider that the University had infringed the appellant's copyright in certain design notes, drawings and diagrams. The documents in question were handwritten design notes, drawings and diagrams prepared by the appellant in 1968 before he commenced employment at the University. We were not referred to evidence sufficient to prove that TYCHO/HASP constituted an infringement of the appellant's copyright, if any, in the contents of those documents. It is significant that the documents, which were the basis of the appellant's claim respecting TYCHO/HASP, were not proferred in his evidence in chief, but were put to him in cross- examination by counsel for the University. They were marked as Exhibits 13A and 13B. The appellant admitted in cross-examination that he never showed these documents to anyone at the University. The TYCHO/HASP software reflected the idea in the 1968 notes, but did not copy any form of expression in them, as would be necessary for infringement of copyright. The learned trial judge relied on the evidence of an independent expert in computer technology, Mr. W. G. Hutchinson, in finding that it was a "long way" from exhibits 13A and B to the source code for TYCHO/HASP. In my judgment, the evidence amply supports the following finding by the learned trial judge: The "idea" is at one extreme of the process, and the source code is at the other end. In between, there are many steps or phases, including the preparation of functional and technical design specifications, the use of computer programming languages to write the code, assembling it in machine language, execution and testing. The skills required to accomplish all these tasks are usually not resident in one person. To go from what is incorporated in Exhibits 13A and B to the finished programme known as TYCHO/HASP would require a significant amount of analysis, planning, and programming by experienced communications programmers. Such programming ability is highly skilled in nature and would likely require someone with a degree in computer science. Dr. Hanis did not possess this ability. Therefore, I reject any suggestion by Dr. Hanis that he had "created" TYCHO/HASP before coming to UWO and that he merely "implemented" his "original work" after his arrival. I find that Dr. Hanis had an idea, which Mr. Kushnir took and used to write most of the source code for TYCHO/HASP under Dr. Hanis' direction. The second point raised in the appellant's factum is that the learned trial judge failed to consider that the appellant was an employer of the consultants who developed the source code for TYCHO/HASP and had obtained from them assignments of the copyright to which they were entitled under s.13(3) of the Copyright Act, R.S.C. 1985, c.C-30. The relevant portions of s.13 read as follows: 13 (1) Subject to this Act, the author of a work shall be the first owner of the copyright therein. ... (3) Where the author of a work was in the employment of some other person under a contract of service or apprenticeship and the work was made in the course of his employment by that person, the person by whom the author was employed shall, in the absence of any agreement to the contrary, be the first owner of the copyright. ... (4) The owner of the copyright in any work may assign the right, either wholly or partially, and either generally or subject to territorial limitations, and either for the whole term of the copyright or for any other part thereof, and may grant any interest in the right by licence, but no assignment or grant is valid unless it is in writing signed by the owner of the right in respect of which the assignment or grant is made, or by his duly authorized agent. Although the appellant had obtained assignments of copyright from his consultants, who were the authors of the TYCHO/HASP software, those assignments, in my judgment, conveyed no ownership to the appellant for two reasons: The consultants were all employees of the University, so that the University was the owner of the copyright in their work under s.13(3). No records were kept to establish that these authors produced the software outside of the course of their employment by the University. The appellant emphasized that the authors were independent contractors, or independent consultants, as opposed to persons under a contract of service with him, so that he did not become the owner of copyright in their work because of the operation of s.13. The third point raised in the appellant's factum is that the learned trial jduge failed to consider that the University assigned copyright to the appellant. The assignment was said to be contained in correspondence between the appellant and the University in 1976. The correspondence consisted of a letter, dated March 29, 1976, from the appellant to Dean Kymlicka and a letter dated June 28, 1976, from A. K. Adlington, Vice- President, Administration and Finance, to Dean Kymlicka, with copy to the appellant, approving the proposal contained in the appellant's letter. The appellant stated in his letter that in the course of developing the Computing Laboratory from "ground zero" he had developed certain software which he had decided to supply in modified and extended versions with the requisite consulting services "to very limited numbers of sites on the following basis". The provisions relevant to copyright are the first two, which read as follows: As the author, I intend to exercise copyright ownership over the software and modification and extensions thereto under section E-X-1 of the Faculty Handbook. In order to proceed in a clearcut fashion, I have invested in the establishment of a firm, Tycho Research Associates, (P.O. Box #415, Station 'B', London, Ontario). Tycho is presently an individual proprietorship, but will be incorporated if and when activity should warrant the expense. Ownership of the software copyrights is held by Tycho and Tycho will contract with interested clients for the supply of modified versions of RSTS/UT200 or RSTS/HASP and the prerequisite consulting services. The short answer to the third point in the appellant's factum is that the letter of March 29, 1976, did not contain any words of conveyance or transfer of any copyright interest from the University to the appellant. The appellant in his letter did not recognize that the University owned any copyright of which he was seeking an assignment. Instead, he asserted in the letter that he owned the copyright in the software and would licence it to the University. For the foregoing reasons, I see no error in the decision of the learned trial judge denying the copyright interest in TYCHO/HASP claimed by the appellant. UNJUST ENRICHMENT In view of the substantial benefits received by the appellant from the use of the resources of the University, I see no merit in the appellant's claim to compensation based on the doctrine of unjust enrichment. RESULT The appeal is allowed. The judgment below is set aside and in its place will be judgment for the plaintiff for $158,034.54, less any income earned from employment by the appellant during the 18 months following his dismissal. If the parties are unable to agree on the amount of such income, there will be a reference to determine such amount. As requested by Mr. Ortvid, with the agreement of Mr. Roland, the Court will hear submissions from counsel before making any order with respect to costs. Counsel may make arrangements for a date on which those submissions will be heard. The Court will expect counsel on that date to speak as well to the amount of the deduction to be made in respect of income earned by the appellant from employment following his dismissal and to the entitlement of the plaintiff to prejudgment interest, including the appropriate rate and date of commencement. RELEASED: JUNE 18, 1998