Perron v. IG Image Group Inc.

2020 BCSC 171 Perron v. IG Image Group Inc.

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Perron v. IG Image Group Inc., 2020 BCSC 171 Date: 20200213 Docket: S186096 Registry: Vancouver Between: Janet Therese Perron Plaintiff And: IG Image Group Inc., Laura Hansen, and Sherry-Lynne Fedorchuk Defendants Before: The Honourable Madam Justice Adair Reasons for Judgment Counsel for the Plaintiff: J. Yeager Counsel for the Defendants: L. Ridgedale M. Kampman Place and Date of Trial: Vancouver, B.C. November 4-8, December 4-5, 2019 Place and Date of Judgment: Vancouver, B.C. February 13, 2020 1. Introduction. 2 2. Review of the evidence. 4 3. Discussion and analysis. 34 (a) Ms. Perron's claim of constructive dismissal 34 (i) Basic legal principles. 35 (ii) The terms of Ms. Perron's contract 38 (iii) The Account Conflicts Term.. 38 (iv) The Client Protection Term.. 41 (v) Unilateral transfer of an account on the client's request 47 (vi) "Honest performance" 48 (vii) Did Image Group's conduct make continued employment intolerable?. 50 (viii) Summary regarding Ms. Perron's claim of constructive dismissal 51 (b) Ms. Perron's conspiracy claim.. 51 (c) Ms. Perron's inducing breach of contract claim.. 53 (d) Ms. Perron's claim of intentional interference with economic relations. 54 4. Summary and disposition. 55 1. Introduction [1] For many years, the plaintiff, Janet Perron, worked as a sales representative, selling "promotional

products." "Promotional products" are products that a company or business uses to promote itself or its "brand." They are both a form of marketing and of advertising. Thousands of different items can be used as promotional products. Some well-known examples are umbrellas, pens, mugs, shopping or gift bags, food (such as chocolate bars) and clothing. Promotional products such as uniforms can be used to identify employees of a business. [2] Ms. Perron had assembled a substantial client list. Her major clients included BC Investment Management Corporation ("BCIMC") and the property management company Bentall Kennedy (Canada) LP ("Bentall Kennedy"). [3] In January 2012, Ms. Perron joined the defendant IG Image Group Inc. ("Image Group") as a sales representative, bringing her clients with her. The defendant Laura Hansen is the president of Image Group. The defendant Sherry-Lynne Fedorchuk has worked as a sales representative at Image Group since 1992. [4] Ms. Perron asserts that, in late 2017, she was constructively dismissed from her employment at Image Group. Ms. Perron says that, after bringing her clients to Image Group, she suffered the takeover of her biggest account by Ms. Fedorchuk, who conspired with Ms. Hansen to bring about that result. She says that Ms. Hansen and Ms. Fedorchuk first loosened Ms. Perron's grip on her client, then hollowed out all of its value to Ms.

Perron and ultimately brought about the transfer of the account to Ms. Fedorchuk. Ms. Perron says that Image Group ignored its policies concerning client protection and encroachment and, instead, followed unwritten policies concerning commission allocation and client retention that resulted in the destruction of Ms. Perron's employment and livelihood. Ms. Perron says that her case is one that involves extensive bad faith on the part of Image Group in its dealings with her in 2017, and that she became the victim of a cutthroat business. [5] The defendants say that Ms. Perron's action must be dismissed. [6] Image Group says that the evidence shows Ms. Perron voluntarily walked away from her job in November 2017. Image Group says that it acted reasonably when it applied its policies and that Ms. Perron acted unreasonably when she resigned after losing a client, an unfortunate, but familiar, event in the sales industry. Image Group says that Ms. Perron contorted the meaning and purpose of Image Group's policies in a way that suited her desired outcome: entitlement to sales commissions that had been earned by Ms. Fedorchuk. Rather than acting in bad faith, Image Group says that it conducted itself in a reasonable and sensitive manner in dealing with Ms. Perron's concerns during a time when she was making numerous and baseless complaints about Ms. Fedorchuk. [7] For their part, the individual defendants, Ms. Hansen and Ms. Fedorchuk, say that Ms. Perron's conspiracy and other claims against them are frivolous and wholly unsupported on both the evidence and the applicable legal principles.

2. Review of the evidence [8] Ms. Perron was born in April 1949. After graduation from high school, she took a two-year college course in tourism and travel. She was hired by Tourism Alberta, where she was employed for about five years. Ms. Perron then moved to Fabergé Canada, and became its sales representative in Alberta. She was transferred to Vancouver in 1985 as its western Canada sales manager. She left Fabergé in 1986 and joined Grennan Marketing, a promotional products company, in 1986. [9] Ms. Perron worked at Grennan for about three years, and then moved to Edmonton. She continued to work as a sales representative, sourcing and selling promotional products for a growing group of clients. She and her brother incorporated a company, Innovative Impressions Ltd. ("Innovative"), to carry on that business. In about 1996, Ms. Perron took over Innovative from her brother. She moved from Edmonton back to the Lower Mainland, and settled in White Rock. [10] Once in White Rock, Ms. Perron continued to build up Innovative's client list. To develop business, she joined various business associations, such as the Chamber of Commerce and the Professional Women's Association. [11] Innovative's clients included companies such as Canadian National Railway, Peace Arch Hospital and Kwantlen College. One of Innovative's most important and lucrative clients was Bentall Kennedy, whose

property management portfolio included a number of shopping centres located across Canada, as well as condominium and rental properties. Ms. Perron explained that she began working for Bentall Kennedy when the manager of another shopping centre, Bonney Rempel, with whom Ms. Perron had worked, moved to Bentall Kennedy. In addition, Ms. Perron's client BCIMC owned a number of the properties managed by Bentall Kennedy. On her client list, Ms. Perron listed and dealt with individual properties (for example, shopping centres) owned by BCIMC and managed by Bentall Kennedy as separate clients. Generally, where Bentall Kennedy managed property for BCIMC, Ms. Perron's contact person was at Bentall Kennedy, not at BCIMC. She explained that, in connection for the purchase and sale of promotional products for a shopping centre property, she would typically deal with the marketing manager. [12] Around 2010, Ms. Perron decided that she wanted to move to Vancouver from White Rock. However, since she did not want to have to locate office space for Innovative, she began looking for an existing promotional products company where she could service her clients. Ms. Perron explained that she did some research, talked to a few people and received some recommendations. As a result, she contacted Ms. Hansen at Image Group about possibly joining the company. Ms. Perron explained that the location of

Image Group's office in Vancouver, as well as the recommendations she had received, were important in making contact with Ms. Hansen. [13] Ms. Hansen has about three decades of experience in the promotional products business. She explained that in the 1980s, she purchased what had been the promotional products part of a family business, and she then carried on that business as "JBI Advertising." In 1992, JBI Advertising merged with Grennan to form Image Group, of which Ms. Hansen was then part owner. In 1996, Ms. Hansen became the sole owner of Image Group. Ms. Hansen explained that, before she became Image Group's owner, she was mainly involved in sales. However, since becoming the owner, she is primarily involved in managing the sales team and some administration, and does little selling herself. [14] Ms. Fedorchuk has worked with Ms. Hansen since the late 1980s, when both of them were at JBI Advertising. [15] Compensation for sales representatives at Image Group is 100% commission-based, with the sales representative receiving 50% of the net profit on a sale to the sales representative's client. The commission is paid to the individual who is the sales representative for the client that is invoiced, and it is paid after Image Group receives payment of an invoice from the client. [16] In the summer of 2011, Ms. Perron and Ms. Hansen met with one another to discuss the

possibility of Ms. Perron coming to work at Image Group. Following that meeting, and on July 11, Ms. Hansen sent Ms. Perron an email message that both agree captured essentially what was discussed at the meeting. Ms. Hansen's message read in part: It was great to meet with you yesterday. Just to recap our conversation: You have been in the promo product business as long as I have (a long time!). First, working with Grennan, then in Edmonton and finally for the past few years in White Rock. You are wanting to move into the city and continue selling. Working with Image Group makes sense because: You have a solid client base that you can continue to work with You will have more time to sell as you will not have as many admin duties You will have the IG team to help with idea sourcing You like the idea of working out of the IG office as it is more disciplined and structured than working solo. Matters to be considered: Account conflicts: Key accounts are not normally an issue. For other accounts that you and Image Group both have I give the business to the person that has the most sales in the past year or two. Remuneration for bringing your client base to Image Group: I suggest at 60/40 split (instead of 50/50) for 1 year . . .. [17] Ms. Perron recalled that, at this point, she wanted to know the terms on which she would be joining Image Group, and she also wanted to make sure that

her accounts, which she would be bringing with her, would remain hers. She described the latter as "essential." [18] Ms. Hansen explained that, when a new sales representative joins Image Group, that person will have their own client list. One of the new representative's smaller accounts may be a large account with an existing representative at Image Group, and vice versa. Such conflicts are resolved by assigning the account to the person with the most sales, as Ms. Hansen described in her email. Ms. Hansen explained that "Key accounts" of the person joining are usually not an issue because it is unlikely Image Group has been selling to those accounts. [19] Ms. Hansen wanted Ms. Perron to join Image Group. She knew that Ms. Perron had been in the business for a long time, and her expectation was that Ms. Perron was a very good sales representative. As Ms. Hansen recalled, although she followed up with Ms. Perron from time to time after their July meeting, she did not hear back from Ms. Perron for some months. [20] However, by late December 2011, Ms. Perron had decided to join Image Group. Ms. Hansen (on behalf of Image Group) sent Ms. Perron a letter dated December 22, 2011, offering employment. The letter read in relevant part: It is a pleasure to offer you employment as a commissioned sales representative at Image Group effective January 11, 2012 on the following basis: 1. You will work as a commissioned sales representative providing your clients with a high degree of professionalism and service in meeting their promotional product requirements.

2. Your commissions shall be 70% of the net profit on all transactions (after all applicable costs have been accounted for) for one year and shall be payable at the pay period immediately following the collection of the receivable from the customer. Following that, your commissions will be 50% of the net profit. 3. . . . As well 4% holiday pay will be deducted from your commissions, held for you and paid out to you when you take holidays.

4. After being employed for 3 months you are eligible to sign on to extended health and dental benefits. Image Group covers 50% of the cost and the other 50% would be covered by you. . . .

5. You will use your best efforts to attract and retain clients for Image Group and will ensure that you do not approach any accounts already under the protection of other sales representatives of Image Group.

6. A performance review shall be conducted in March 2012.

7. Image Group will supply you with an office, computer, product sourcing resources and other marketing materials as required to assist you in conducting your business. [21] Ms. Perron accepted the offer, and started work as a sales representative at Image Group in January 2012. [22] Ms. Hansen explained how a conflict check is done (and would have been done when Ms. Perron joined) at Image Group. All existing clients are listed in a database, according to how the client wishes to be invoiced. Except for what are called "house accounts," all clients (or accounts) are attached to a particular sales representative. If a sales representative tries to enter a client name into the system where the client already exists (and is therefore attached to another representative), the representative cannot enter the client's name. [23] Ms. Perron believed that at her July 10 meeting with Ms. Hansen, she and Ms. Hansen reviewed Ms. Perron's client list for the purpose of identifying conflicts. However, according to Ms. Hansen, this review was not done until Ms. Perron had accepted the offer of employment. I find that Ms. Hansen's recollection is more reliable and makes the most sense. There would be little point reviewing Ms. Perron's client list in July, when Ms. Perron was still considering her options. On the other hand, review of Ms. Perron's client list to identify (and resolve)

conflicts when she joined Image Group was essential. [24] During the review of Ms. Perron's client list, Ms. Perron and Ms. Hansen identified a single instance where a client (Métis Nation) was on both lists. Ms. Perron had recent sales to that client, and Ms. Hansen confirmed that the client would remain with Ms. Perron. Ms. Perron and Ms. Hansen agree that this client was then transferred to Ms. Perron in Image Group's client database. This reinforces my conclusion that Ms. Hansen's memory is the more accurate concerning the timing of the review of Ms. Perron's client list. Until Ms. Perron was hired by Image Group, nothing could be transferred to her. [25] Ms. Perron fit in well at Image Group. She continued to service her existing clients and developed new clients. Sales meetings were held every two weeks for Image Group sales representatives. However, for the most part, representatives worked independently, servicing their own group of clients. [26] According to Ms. Perron, Bentall Kennedy (and its related properties) continued to represent her key accounts. Ms. Perron explained that she expanded that business in 2012. Among other things, she ran a national program that received an award from the Promotional Products Association of Canada. Bentall Kennedy also received a display piece in connection with that program, which was presented to Ms. Rempel. Ms. Perron's sales to

Bentall Kennedy continued to go up, and Bentall Kennedy-related leads were passed on to her. Ms. Perron provided promotional products to a Bentall Kennedy-related property, Bower Place, in Red Deer, Alberta, which was undergoing a rebranding. Ms. Perron described that project as a "happy day" and very profitable for her, since, as a result of the rebranding, Bower Place was ordering everything new. [27] In July 2016, Ms. Fedorchuk was contacted by a representative of one of her long-time clients, Daniel J. Edelman Ltd. ("Edelman"). [28] Edelman was a public relations firm and advertising agency. It had been Ms. Fedorchuk's client since 2007, and, as Ms. Fedorchuk explained, since then, she had worked with Edelman on different projects (for example, for the Heart and Stroke Foundation). As of July 2016, she had not made any sales to Edelman since early 2013. However, Ms. Fedorchuk explained that advertising agencies do not always need promotional products. Rather, they are project-based, and promotional products are often simply an add-on to a larger project. Like some of her other accounts, Edelman had been "quiet" for a while. However, according to Ms. Fedorchuk, even though she had not been selling products to Edelman between 2013 and mid-2016, she kept in touch, as she considered it was just a matter of time before she would do business with Edelman again. Ms. Fedorchuk

explained that if another Image Group sales representative had wanted to sell to Edelman between 2013 and July 2016, the representative would have had to come to her and ask for her agreement. Ms. Fedorchuk explained that she would not have agreed to give up Edelman as a client. Indeed, as Ms. Fedorchuk recalled, another Image Group sales representative came to her and asked to take over the Edelman account from Ms. Fedorchuk because the girlfriend of the representative's son was working there. Ms. Fedorchuk said no. [29] Since Edelman was listed as Ms. Fedorchuk's client and account in Image Group's database, any contact from Edelman to Image Group would be forwarded to Ms. Fedorchuk. [30] When Edelman contacted Ms. Fedorchuk in 2016, it was to have Ms. Fedorchuk work on a project that Edelman was handling for one of its clients. The project involved new branding for an entity called "QuadReal." After she began working on this assignment for Edelman, Ms. Fedorchuk registered QuadReal under her name as a "prospect" in Image Group's client database. She was able to do this because, at the time, QuadReal was not associated with any other Image Group sales representative. [31] Ms. Hansen and Ms. Perron both recalled that, at sales meetings, Ms. Fedorchuk mentioned the work she was doing for Edelman. However, it was unclear who Edelman's client was. [32] Throughout the balance of

2016, Ms. Fedorchuk received orders from and made sales to Edelman of promotional projects with the QuadReal brand. Ms. Fedorchuk had contact only with individuals at Edelman, which was her client. Orders were shipped to locations based on shipping instructions Ms. Fedorchuk received from Edelman. Ms. Fedorchuk never had any contact with anyone at QuadReal. The Image Group invoices for the sales Ms. Fedorchuk was making to Edelman were addressed to Edelman, and they were paid by Edelman. Ms. Fedorchuk received her commissions on the sales once the invoices were paid by Edelman. [33] As Ms. Perron recalled, in mid-January 2017, she was doing some work in Image Group's warehouse when she saw a document, which Ms. Perron described as a packing slip, sitting out on a desk. Ms. Perron took a closer look. The document included an email message from Ms. Fedorchuk to a warehouse employee, titled "Total box count for shipping." Ms. Fedorchuk was forwarding an email from "Ink Pad Print + Design" that set out a number of shipping addresses. Ms. Perron saw that "Bentall" was mentioned in most of the addresses. "QuadReal" was mentioned in one address. [34] As Ms. Perron recalled, she was very concerned when she saw that shipments were going to her client Bentall Kennedy. She wanted to know who was shipping goods to her client. [35] Ms. Perron then sent an email message dated January 16,

2017 addressed to all Image Group sales representatives, with "high importance." The subject line was "My client Bentall Kennedy." The message read: Hi. Has anyone been in contact with Bentall Kennedy, any of their divisions; real estate, rental properties, shopping centres etc." Thanks Janet [36] Ms. Fedorchuk responded promptly by email, and said: Let me clarify that I don't have any contact with your client. Only through the ad agency/PR firm Edelman. All goods are invoiced to Edelman. [37] Ms. Perron responded (again promptly) with another email message addressed to "All Sales": So no direct contact with Bentall Kennedy? What is Edelman doing with BK? [38] Very shortly thereafter, another sales representative, Jenn Forgie, responded by email sent to Ms. Perron and "All Sales," saying: I see. Edelman is a PR agency. Sales through PR agencies can overlap to other reps clients but that is fine if the invoice is to the PR firm. Happens all the time. [39] In her evidence at trial, Ms. Fedorchuk said that she agreed with what Ms. Forgie said in her email message, and described how something similar had happened to Ms. Forgie and another Image Group representative, Terry Cochrane. Mr. Cochrane's client was going through a rebranding. However, the rebranding was handled, not by Mr. Cochrane's client, but by an advertising agency that was a client of another Image Group sales

representative. [40] At trial, Ms. Perron denied receiving Ms. Forgie's email message. However, I have concluded she is mistaken in her recollection. Ms. Forgie's message is addressed to Ms. Perron personally, as well as to "All Sales." I find that Ms. Perron received Ms. Forgie's message. Moreover, I find that Ms. Forgie accurately described the situation where a client decided to hire a public relations agency (such as Edelman) to handle purchases of promotional products. [41] According to Ms. Perron, she did not know about QuadReal until she saw the packing slip in the warehouse, although, as she recalled, she had heard the name in 2016. [42] As Ms. Perron recalled, after seeing the packing slip, she did a Google search on QuadReal and found out some more information. According to Ms. Perron, she learned that QuadReal was a new property management company, and that all of her BCIMC clients were moving to QuadReal and were no longer being managed by Bentall Kennedy. Moreover, according to Ms. Perron, she discovered that a division of Bentall Kennedy staff was also moving over to QuadReal, including Ms. Perron's long-time Bentall Kennedy contact, Ms. Rempel. According to Ms. Perron, prior to her discovery of the packing slip, no one at either Bentall Kennedy or BCIMC had told her or provided her with any information about the creation of or move to QuadReal. [43] When she saw

the packing slip, Ms. Perron was very concerned and upset. She explained that she thought the clients she had brought with her to Image Group, in particular Bentall Kennedy and BCIMC, which she considered key clients, would be protected for her. Despite what Ms. Fedorchuk and Ms. Forgie communicated in their email messages, it appeared to Ms. Perron that someone else at Image Group was selling to her clients. Ms. Perron believed that, since she was the sales representative for BCIMC and for Bentall Kennedy properties that were moving over to be managed by QuadReal, QuadReal should be listed as her client in Image Group's database. [44] Once more of QuadReal's background became known, neither Ms. Hansen nor Ms. Fedorchuk disagreed with Ms. Perron's request to be shown as the sales representative for QuadReal and the person entitled to commissions for sales by Image Group to QuadReal. QuadReal was then transferred from Ms. Fedorchuk to Ms. Perron. Ms. Perron entered two listings under QuadReal, one with a Vancouver address and one with a Toronto address. She explained that she wanted to make sure that no one else could list QuadReal as a client, and that others looking in the database could see that QuadReal was her client. [45] However, Ms. Perron remained extremely concerned. Despite being told that it was not happening (which was true), Ms. Perron did not believe that Ms.

Fedorchuk was not contacting QuadReal and Bentall Kennedy directly. [46] Somewhat unfortunately, although their offices were very close to one another, Ms. Perron and Ms. Fedorchuk communicated mostly by email. [47] In the morning on January 30, 2017, Ms. Perron sent an email to Ms. Fedorchuk, with the Subject line "Bentall contact": Hi Sherry Lynn, Have you been in contact with Bentall Kennedy? Who? When? [48] Ms. Fedorchuk responded a few minutes later: Janet, I have never spoken with anyone at Bentall Kennedy ever. Why are you asking? My dealing is with Edelman only. I would never go behind my clients back to speak directly with their client. It is clear that, in saying she would never go behind her client's back, Ms. Fedorchuk was speaking of her client Edelman. [49] Ms. Perron responded about 30 minutes later: I met with Bentall last week, & one of their divisions had received info from I.G. [Image Group]. They didn't specify if it was telephone call or samples or catalogues. [50] Ms. Fedorchuk replied shortly thereafter: The only way they would have received info from Image Group would be if a package was shipped direct to them as my client would have instructed me to do so, or if the samples I sent direct to my client were then forwarded to them. I don't appreciate the accusatory tone in your email. I have been working with Image Group for 28 years with a strong

reputation of being honest and forthright. [51] Ms. Perron responded later that afternoon, copying Ms. Hansen: Hi Sherry Lynn, There was no accusatory tone. I was asking for information re my client, & the comments/questions they had. Bentall Kennedy is a client I brought into Image Group 5 years ago, and & have working with them for the past 10 years. Let's meet with Laura to discuss my BK/QR, & your Edelman, how best to work with both clients. Although I've been with Image Group only 5 years & in the industry 29 years, I too have a strong reputation [of being] honest and forthright. Thanks Sherry Lynn & Laura[.] [52] Ms. Hansen then responded to both Ms. Perron and Ms. Fedorchuk: Hi Janet and Sherry Lynne, The accounts seem to be pretty clear cut so far. Janet - you work with Bentall Kennedy/QR and Sherry Lynne - you work with Edelman. Because ad agencies work with many customers there can appear to be an overlap but we track accounts based on who places the business and who that account belongs to so it keeps really clear. [53] Ms. Hansen's message conveyed the same perspective as Ms. Forgie's email concerning sales where an advertising agency is involved on behalf of a client. [54] However, Ms. Perron was not happy with Ms. Hansen's response. In particular, she was not happy with Ms. Hansen's acknowledgment that Edelman was Ms. Fedorchuk's client (although Ms. Perron

herself had referred to "your Edelman," with reference to Ms. Fedorchuk). According to Ms. Perron, when Ms. Hansen told her this, Ms. Perron then investigated the history of Ms. Fedorchuk's sales to Edelman. She discovered the gap in sales between early 2013 and July 2016. Ms. Perron concluded on that basis that Edelman should have been "up for grabs" as a client when the contact with Image Group was made in mid-2016, that Edelman should not have been treated automatically as Ms. Fedorchuk's client, and that she (Ms. Perron) should have been in line to receive Edelman's business on the project for QuadReal. Ms. Perron explained that, in her mind, the lack of sales to Edelman between 2013 and 2016 was relevant because of what Ms. Hansen had told her at their July 2011 meeting about account conflicts, and how Ms. Hansen would "give the business to the person that had the most sales in the past year or two." Ms. Perron described this as the "1-2 year rule," or sometimes the "Two year rule." According to Ms. Perron, she understood that the rule operated so that if a sales representative had no sales activity on an account for one to two years, then the client would be transferred to another sales representative. As far as Ms. Perron was concerned, this is what should have been done with Edelman in July 2016, and the account should have been transferred to her. [55] More generally,

Ms. Perron felt that Ms. Hansen had failed to respond to her concerns. According to Ms. Perron, she wanted and needed information about what was going on with her clients. She was frustrated and felt at a disadvantage dealing with her clients Bentall Kennedy and QuadReal. As far as she was concerned, no one at Image Group was forthcoming with information. [56] However, although Ms. Perron complained that she felt she was being "left in the dark" by Image Group, she did little to follow up with her own contacts at Bentall Kennedy and QuadReal, and to find out information directly from them. She explained that staff was being split up and her contacts either would not or could not talk about what was going on. Ms. Perron said that she did not contact QuadReal because things were in a "state of flux," and she did not know where QuadReal's offices were located. When Ms. Perron was asked directly at trial whether, after she learned about QuadReal in early 2017, she asked to meet and make a marketing pitch, her answer, essentially, was no, she did not. Ms. Perron explained she did not because she knew that Image Group was working with Edelman on the QuadReal rebranding, and there was therefore a conflict if she pursued that business directly with QuadReal. [57] Towards the end of February 2017, Ms. Perron and Ms. Hansen met with one another to discuss the situation. As Ms. Hansen

recalled, they discussed what Ms. Hansen described as the "account protection policy" set out in para. 5 of the letter offering Ms. Perron employment, to the effect that a sales representative was to ensure that she did not approach any accounts under the protection of another Image Group sales representative. Ms. Hansen reiterated that Edelman was Ms. Fedorchuk's client, and the commissions on what was ordered by and invoiced to Edelman were Ms. Fedorchuk's. Ms. Fedorchuk was not interested in working with Ms. Perron on the Edelman account. Ms. Perron continued to be dissatisfied with Ms. Hansen's responses to her questions. She remained very concerned that Ms. Fedorchuk was in direct contact with her clients and wanted details about "when, who and how." [58] On March 26, 2017 (a Sunday), Ms. Perron sent a lengthy email to Ms. Hansen. The subject line was "QuadReal/Bentall Kennedy/Edelman," and the message was sent with "High" importance. The message read in part: Hi Laura, When I started working with Image Group in 2012, we reviewed my list of clients I was bringing to Image Group. There were no conflicts with Bentall Kennedy, my #1 client. Bentall Kennedy was & is my client. The memorandum of understanding with Image Group & the industry wide expectation . . . is the sales person client list belongs to the rep. No poaching by any other sales person. Unethical. Terms you verbally detailed when we met in Dec. 2011 & Jan. 2012 included - 1. When a rep receives a referral & the company is on an existing client list of another sales rep & the account is active with sales, the originating rep. receives the referral. . . .

2. Rep. receives a referral & the account has not been active for 2 years, the referral & account is allocated to the Rep. who received the referral. - Rocky Mountain Tours - Terry had a contact, I did not have any sales with the account, you transferred the account to Terry.

3. MNBC [Métis Nation] - was listed as Debbie's account (I assume with no sales in the previous 2 years) you transferred the account to me as I had a history of sales to MNBC . . . You spoke to or emailed the 2 reps involved, . . . Everybody was on the same page. The rules and trust were reaffirmed. This was standard operating procedure for the sales team, as discussed personally with you & in our sales meetings. . . . Bentall Kennedy, QuadReal, Ivanhoe Cambridge & Oakridge Centre, & all their legal names are my clients. . . . Jan. 2017, I read a printed email from Sherry Lynne to the warehouse regarding shipping goods to various Bentall Kennedy & QuadReal properties. Why was Sherry Lynne shipping goods to my client. After a couple of emails & some conversations, I [was] informed that Sherry Lynne was working with the Edelman Agency, [on] a uniform programme for QuadReal. When was the last sales Sherry Lynne had with Edelman? Jan. 2013? Is that correct? No sales in 3+ years. If that is correct, the Edelman inquiry regarding Bentall Kennedy and QuadReal should have been forward[ed] to me. The QuadReal properties include 8 centres I have been selling to for the past 5 years. . . . I have a 15 year business relationship with the western Canada Regional Director of Retail Sales for QuadReal & the marketing manager for Oakridge Centre [Ms. Rempel]. When was your first meeting with

Edelman? June 2016. My clients involved, & you did not inform me. Why not? Feb. 24th 9:30 - 10:30 I requested a meeting with you to further discuss Sherry Lynne's direct contact with my clients & details regarding the Edelman programs. I never received the Edelman info. or any feedback regarding my concerns. Why not? Both you & Gillian stated that Sherry Lynne was not in direct contact with my clients or invoicing them directly. All purchases & invoicing was between Image Group and Edelman. Mar 3, 2017 - I believe it was on this Friday, I heard a conversation between you & Sherry Lynne in the hall near the kitchen, discussing invoicing Bentall Kennedy /Quad Real properties directly. . . . Is Image Group invoicing or will be invoicing the Bentall Kennedy or the QuadReal properties or their legal names? Is Sherry Lynne selling directly to my clients? Has Sherry Lynne met with my clients at their offices or retail properties, (shopping centres)? Has Sherry Lynne provided proposals for hard goods, promo apparel, uniforms to my clients? . . . Are you taking my major client & giving the client to Sherry Lynne? . . . Has Image Group used my artwork, proposals, emails etc. without my knowledge? . . . To "right the ship" the Edelman account & past & present commissions & all commissions from direct invoicing to Bentall Kennedy & QuadReal be transferred to me. Sherry Lynne should have no

further contact with Edelman or Bentall Kennedy & QuadReal properties. Laura, I would appreciate your response by April 3, 2017 for a mutually beneficial resolution. [59] Ms. Hansen provided a lengthy response by email a few days later. The email read in part: Hi Janet, This is true that Bentall Kennedy was and is your account. We have protected accounts at Image Group ie. We do not assign territories to a sale[s] person but rather they register their prospects and customers in our system and follow up with those on their lists. This is the same for all sales people. . . . Where we send samples does not determine who belongs to the account. We are often asked to send samples on behalf of our customers to their customer or another end user. . . . Just as you have a longstanding relationship with Bentall Kennedy, Sherry Lynne has a longstanding one with Edelman. Edelman works with their customers who hire them to execute projects. Their customers vary and projects come and go. They do not always require the services of a distributor like Image Group. That is why we ask these questions when determining an inactive account: - is there ongoing communication between the customer and the sales rep? - is the sales rep actively quoting on projects for the customer? - is the relationship between the two parties a good one? These factors help us determine if the account is 'active'. In

most cases the sales person will voluntarily throw an account back into the pool if they hit a wall and can't progress with that account. When Sherry Lynne began working on this current project with Edelman their client's name did not resonate with her. They were not in our system and this is why she entered them as a prospect. Once we became aware of the connection to Bentall Kennedy we had you add that name onto your list of customers. I don't recall a conversation with Sherry Lynne on March 3rd but we have discussed the possibility that Edelman may stop working on the project for their customer. To date however their customer has continued to work with Edelman on this project. Yes you are correct that much of our work is confidential - especially if we are working on a new logo or brand for our customers and so at times we can't even share with the group except for generalities. While all Image Group work is the property of Image Group we would never use your artwork, proposals, emails etc. without your knowledge. We only log into your system in order to cover for you at your request or if you have computer issues. As mentioned all accounts are protected for the sales person. This also includes the Edelman account for Sherry Lynne. An account is determined by where the invoice is billed to. We cannot control who our customers choose to have as their customers and that's why

we use the billing address as our guide. I am sorry Janet that you seem to have lost trust in our system and how we work. [60] Ms. Perron confirmed at trial that she recalled receiving Ms. Hansen's email. [61] I am going to pause the review of the evidence at this point and state some conclusions. [62] First, in her March 26 email, Ms. Perron sets out what she described as terms (which she numbered 1, 2 and 3) that she said Ms. Hansen had "verbally detailed" at earlier meetings. However, in my view, Ms. Perron's memory as of trial of what she discussed with Ms. Hansen is not reliable. As I noted above, I rejected Ms. Perron's evidence about the timing of the conflict check, for example. [63] In her oral evidence at trial, Ms. Perron described the terms she numbered 1, 2 and 3 as terms of her employment agreement with Image Group. In her email, Ms. Perron then relied on her understanding of the terms, first to advance her position that what Ms. Fedorchuk was doing was prohibited, and, ultimately, to demand that Edelman be transferred (along with the commissions earned) from Ms. Fedorchuk to her. However, as I will describe below, what Ms. Perron set out in her email is, at best, Ms. Perron's subjective understanding of the terms of her employment agreement. Her personal opinion concerning the terms she and Ms. Hansen agreed to, and what those terms meant, is irrelevant. [64]

Even assuming that Ms. Perron is correct with respect to term no. 2, it does not support her position that she was entitled to the Edelman account when Edelman contacted Image Group in 2016. On the undisputed facts, Ms. Fedorchuk received the referral from Edelman in 2016, not Ms. Perron. At that point, no one at Image Group knew about QuadReal's background, or its connection with Bentall Kennedy or BCIMC. All that Ms. Fedorchuk knew was that "QuadReal" was Edelman's client. Ms. Fedorchuk had a long-standing relationship with Edelman. Ms. Perron had none. [65] Second, in January 2017, Ms. Perron had received an answer to her question, "Why was Sherry Lynne shipping goods to my client?" The answer was because Ms. Fedorchuk was working with Edelman, her client, and goods were being shipped based on the instructions Ms. Fedorchuk received from her client. These facts are undisputed and they are true. Indeed, in her March 26 email, Ms. Perron acknowledges that she knows the answer to her question. [66] Third, none of the suspicions reflected in Ms. Perron's other questions had any basis in fact. All of Image Group's invoices for the sales to Edelman were addressed to Edelman. Image Group never invoiced Bentall Kennedy or QuadReal for any of those sales. These facts have been demonstrated conclusively. Moreover, these were facts Ms. Perron could confirm for herself independently.

Ms. Perron testified that she was able to see what Edelman was ordering by looking for orders under its name. Ms. Perron had been told by Ms. Fedorchuk she was not selling directly to any of Ms. Perron's clients. This was true: Ms. Fedorchuk was not selling directly to any of Ms. Perron's clients. Rather, Ms. Fedorchuk was selling to Edelman. There is no evidence to support Ms. Perron's suspicions that Ms. Fedorchuk either met with Ms. Perron's clients (something Ms. Fedorchuk denied doing) or provided proposals to them. [67] In her response, Ms. Hansen told Ms. Perron that, when Ms. Fedorchuk began working with Edelman, the name of Edelman's client did not resonate with her. That was also true. It is undisputed that when Ms. Fedorchuk began working with Edelman, QuadReal was not registered in Image Group's client database. Ms. Fedorchuk did not learn about QuadReal's background until later. She did not need to know that background in order to carry out the work Edelman, her client, was asking her to do. Indeed, according to Ms. Perron, she herself did not know about QuadReal until January 2017. To imply, as Ms. Perron does in her email to Ms. Hansen, that important facts were deliberately hidden from her at an early stage by Ms. Fedorchuk and Ms. Hansen is simply not supported by the evidence. [68] I now resume my review of the evidence. [69] Ms. Perron continued to be very

unhappy. In the evening on April 25, 2017, she sent another email message to Ms. Hansen, with the subject "Bentall Kennedy/QuadReal & Leads." The email read in part: . . . My email to you of Jan. 30, 2017, our meeting of Feb. 24th, & my email of March 26th requesting information on the Edelman program & what direct contact Sherry Lynne has with my clients, has had no response from Sherry Lynne or anyone at Image Group. When I asked Sherry Lynne for information her email response included "I don't appreciate the accusatory tone". If you read both emails, I did not have a tone, I simply wanted detailed information about my clients & the program. Please confirm that Image Group/Sherry Lynne has not & is not invoicing my clients. What direct contact has Sherry Lynne had with my clients? . . . As mentioned in my March [26th] email, the commissions from sales to my clients [should] be transferred to me. Sherry Lynne should not have any further contact with my clients. . . . Laura, I would appreciate a response by April 28th. [70] Ms. Hansen responded by email dated April 27, 2017, and said: Hi Janet, As stated in my response email to you on March 29th, your emails with Sherry Lynne January 30th, and in our meeting together February 24th, Sherry Lynne has no direct contact with your clients. She does not work with them. She works directly with Edelman who in turn is working with your

clients. [Ms. Hansen copied Ms. Fedorchuk's and her emails to Ms. Perron dated January 30, 2017 into her email.] Orders placed by Edelman are billed to Edelman only. No Edelman orders have been invoiced to your clients. All commissions from sales made to your clients are paid only to you. [71] I find that what Ms. Hansen told Ms. Perron was true. In fact, Ms. Fedorchuk had no direct contact with Ms. Perron's clients, and did not work with them. Ms. Perron had been told this several times. Rather, Ms. Fedorchuk worked directly with Edelman. It was Edelman who was working with Ms. Perron's clients. The orders placed by Edelman were billed to Edelman only, and no Edelman orders had been invoiced to Ms. Perron's clients. All commissions from sales made to Ms. Perron's clients were paid only to Ms. Perron. There were therefore no "commissions from sales to my clients" that needed to be transferred to Ms. Perron. In fact, contrary to Ms. Perron's statement that she had had "no response" from Ms. Fedorchuk "or anyone at Image Group," Ms. Fedorchuk had responded to her directly, as had Ms. Hansen. [72] However, Ms. Perron was unable to accept what either Ms. Fedorchuk or Ms. Hansen told her. [73] On the evening of May 29, 2017, Ms. Perron sent another email, with high importance, to Ms. Hansen. The subject was "Invoicing My Clients Bentall Kennedy, BCIMC/QuadReal." The message read in

part: SFL [Ms. Fedorchuk]/Image Group - is invoicing my clients - Bentall Kennedy & bcImc QuadReal. . . . I saw these PO's in the printer. I pay close attention to all documents referencing my clients. [POs listed] Please provide copies of the above invoices corresponding to the PO#'s listed & all invoices SLF/Image Group has issued to my clients, including Oakridge. Also copies of - Order that have not been invoiced - List of my client account numbers including all: bcIMC, QuadReal, Bentall Kennedy, Ivanhoe Cambridge, Oakridge Mall etc. inputted by Image Group or SLF - All correspondence directed to my clients. Please provide all copies by May 31, 2017. [74] Ms. Hansen responded by email on May 30, 2017, and said: Hi Janet, Please see the 2 invoices below that you are questioning. The other 2 orders have not yet been invoiced. Your clients are referenced on these orders so Edelman can invoice them. All orders placed by Edelman are invoiced to Edelman. BCIMC, QuadReal, Bentall Kennedy, Ivanhoe Cambridge, Oakridge Mall etc are your accounts so orders placed by them are invoiced to them and commissioned to you. Any correspondence sent to your clients directly would have been sent by you. [75] Ms. Hansen's message included screen shots of the two customer invoices. The invoices were both addressed to Edelman. Ms. Hansen explained that, although the layout is different, the

information in the screen shot is the same as on the printed invoice. Ms. Hansen's explanation is correct: the information is the same. [76] The statement in Ms. Perron's email that "SFL [sic]/Image Group - is invoicing my clients" was simply not true. The invoices for the purchase orders listed in Ms. Perron's message were all addressed to Edelman. There is no evidence to the contrary. [77] However, Ms. Perron was not satisfied with Ms. Hansen's response, and she was not satisfied that the screen shots Ms. Hansen had sent her accurately reflected the information on the invoice sent to the client. On June 11, 2017, Ms. Perron sent another email message to Ms. Hansen, which read in part: Hi Laura, Have all the orders listed in my email of 05/29/2017 been invoiced? Please email copies of the copies of the invoices. Are these "F" invoices? Is [Quad]Real/bcImc or any of their legal names paying the invoices directly to Image Group Inc.? Also - please email the client number as requested 05/29/2017. . . . [78] Ms. Hansen responded by email on June 13, 2017, and said in part: Hi Janet, Here are these 2 - the other order has not yet been delivered. For these orders [we] invoice Edelman and Edelman pays us. None are 'F' invoices. [Screen shots of invoices to Edelman] The client account numbers for all your accounts is the number in the top left corner of the customer file - #007443. So

these are easily accessible to you. You are the only one inputting orders under your accounts, unless you are on vacation and we are doing this on your behalf. [Screen shot for customer no. 007443] [79] The screen shots of the invoices reflected the facts: the invoices for the purchase orders Ms. Perron asked about in her May 29 email were addressed to Edelman. These were not sales to any of Ms. Perron's clients, and no invoices were sent to any of her clients. Neither Ms. Fedorchuk nor Image Group was invoicing any of Ms. Perron's clients. [80] On June 22, Ms. Hansen sent Ms. Perron an email with a screen shot of the final invoice Ms. Perron had asked about in her May 29 email. It too reflected the facts: the invoice was addressed to Edelman. It was not addressed to any of Ms. Perron's clients. [81] However, Ms. Perron had further questions about the invoices she had been sent. On June 26, 2017, she sent an email to Ms. Hansen that read in part: Hi Laura, Regarding the invoices shown below, or any of the orders placed by Edelman & the corresponding invoices - is QuadReal/BCIMC paying the invoices directly to Image Group? Is Image Group invoicing QuadReal/BCIMC legal names direct? [82] Ms. Hansen responded by email later that day, and said: Only Edelman is paying for the invoices we sent to them - no other companies. [83] Ms. Hansen's statement was true. [84] However, Ms.

Perron had more questions. On July 3, 2017, she sent an email to Ms. Hansen, with the subject line "QuadReal orders and invoices." Ms. Perron's email read in part: Hi Laura, My client invoices are in the layout shown below, not the same as the Edelman invoices. Has there been a change in format? Your email showing the Edelman invoices . . . will Edelman pay by their cheque or cc directly to Image Group? Why is 75061 invoiced A & B? Re your June 13, 2017 email - I do know [what] the customer numbers are, it's been 5.5 years since I started with Image Group. . . . The question is - has SL Fedorchuk or anyone else in Image Group invoicing [sic] QuadReal, Bentall Kennedy, Oakridge Centre or their legal names directly? [85] Ms. Hansen responded by email on July 4, and said: Morning Janet, I grabbed the invoices I sent you directly from order entry that's why they look different from the one below [part of Ms. Perron's email]. I believe Edelman pays by eft transfer directly from their bank account to ours most of the time - you can check with Gillian. I'm not sure why 75061 was invoiced in 2 lots. It was for 2 items so either they wanted them to be billed separately or one item arrived in before the other so it got billed out first. Neither Sherry Lynne nor anyone else in Image Group is invoicing QuadReal, Bentall Kennedy, Oakridge Centre or their legal names directly. Just Gillian

does on your behalf when she invoices your orders out to them. [86] Ms. Hansen's explanation about why the invoices she sent looked different from what was attached to Ms. Perron's email was accurate. There had been no change in format. Her response to Ms. Perron's questions about payment of the invoices by Edelman was also accurate. Finally, her statement that neither Ms. Fedorchuk nor anyone else at Image Group was invoicing Ms. Perron's clients was true. Despite Ms. Perron's use of "QuadReal orders and invoices" in the subject line of her July 3 email, there were in fact no QuadReal orders or invoices. [87] Although QuadReal was her client, Ms. Perron did not make any sales to QuadReal in the first six months of 2017. However, a representative of QuadReal from Toronto contacted Image Group in the summer of 2017. Since QuadReal was listed as Ms. Perron's client, the lead went to her. In due course, Ms. Perron spoke to Stefanie De Adder, a manager at QuadReal and a person Ms. Perron described as a decision-maker at QuadReal. This was the first time Ms. Perron had any contact with Ms. De Adder. QuadReal was interested in placing an order to purchase 9,000 gift bags. Ms. Perron then proceeded to take the steps necessary to fill QuadReal's order. Ms. Perron also sent Ms. De Adder some information on other promotional products. [88] As Ms. Fedorchuk recalled, in the late summer or

early fall of 2017, Edelman mentioned to her that they had been working on the project with QuadReal for about two years, and they were ready to hand things over to the QuadReal marketing department. According to Ms. Fedorchuk, she told her contact at Edelman that she could not work with QuadReal directly, because QuadReal was Ms. Perron's account. She had earlier told Edelman that they could not use her contact information on a "Look Book" on-line catalogue that Edelman had put together for QuadReal, because QuadReal was not her client. According to Ms. Fedorchuk, when Edelman indicated that, on the handover to QuadReal, they wanted to recommend that Ms. Fedorchuk be the sales representative, Ms. Fedorchuk told them that it was not her call and that they needed to deal with Ms. Hansen. [89] According to Ms. Perron, in early September 2017, while Ms. Perron was working with Ms. De Adder on the gift bag order, Ms. De Adder mentioned that she had received a letter from Image Group about replacing at no charge water bottles that QuadReal had received where the paint was coming off. As Ms. Perron recalled, she was very concerned when she heard this, because it appeared that someone from Image Group was contacting QuadReal, her client, directly, without her knowledge. On September 8, 2017, Ms. Perron and Ms. Hansen exchange email messages about the matter. Essentially, Ms. Hansen's

response was that the water bottles were an Edelman order, and would have been shipped directly to Edelman's client. Ms. Hansen agreed to meet with Ms. Perron and Ms. Fedorchuk the following Monday (September 11) to discuss matters concerning QuadReal and Edelman. [90] However, as Ms. Hansen acknowledged in her evidence at trial, she was fed up and very frustrated trying to deal with the conflict between Ms. Perron and Ms. Fedorchuk. As Ms. Hansen recalled, it did not seem to matter how much she explained things to Ms. Perron, Ms. Perron would not believe that Ms. Fedorchuk was not selling to Ms. Perron's accounts. Ms. Hansen expressed her frustrations in an email sent to both Ms. Perron and Ms. Fedorchuk at the end of the day on September 8. The email read as follows: Hi Sherry Lynne and Janet, I am at my wits end with the barrage of email regarding these 2 accounts. We need to find some middle ground. Let's meet Monday at 10 am. My wish is for Sherry Lynne to continue to work with Edelman and Janet to work with her accounts - Quadreal, BK and others. There is obviously overlap but where the invoice goes is how we divide up the business. Somehow that is not working for either of you. There is no collaboration or support between you two - just greed and push back. My options: ● assign the whole enchilada to another rep ● assign the whole enchilada to another

distributor Benefits to me? I will live another 2 years without a heart attack. Your solutions: ● Bring them please. Thanks and have a good weekend. [91] Shortly thereafter, Ms. Fedorchuk responded with an email to both Ms. Hansen and Ms. Perron, which said: For the record I never sent any letter to Stephanie [De Adder] at Quadreal. I have never contacted anyone at Quadreal ever! The first order of water bottles that Edelman ordered were defective with the logos coming off. We credited Edelman for the order and replaced them with an order from Leeds. The preproduction sample may have been sent to a Toronto location but there was never a letter enclosed with it. If there was a letter it would have come from Edelman not me. I am happy to continue working with Edelman until they decide they do not want to work with me. And Janet can continue to work with her client case closed. [92] In her evidence at trial, Ms. Fedorchuk confirmed the truth of the facts stated in her email. I accept Ms. Fedorchuk's evidence. [93] On September 10, 2017, Ms. Perron advised Ms. Hansen that she was unfortunately not available for a meeting on September 11, and suggested meeting on September 14. On September 14, Ms. Perron and Ms. Hansen exchanged email messages about quotes on hardhats. Ms. Perron was concerned that both she (at the request of Ms. Rempel on behalf of QuadReal) and Ms. Fedorchuk (on

behalf of Edelman) were quoting on the same project, and that supplier mock-ups that she had requested had been sent to Ms. Fedorchuk. Ms. Perron wanted Edelman to be told that Image Group could not provide it with a quote on the hardhat project. Ms. Hansen did not agree, and suggested that, even if there was only one project, QuadReal may simply have decided to get two quotes (one from Ms. Perron, and one from Ms. Fedorchuk through Edelman). When Ms. Hansen queried whether Ms. Perron still wanted to meet that afternoon as planned, Ms. Perron responded that she could not, and proposed meeting the following Monday. [94] Ms. Hansen and Ms. Perron did not have a meeting the following Monday. However, a few days later, on September 21, 2017, Ms. Perron hand-delivered a letter to Ms. Hansen. According to Ms. Perron, she had given some thought to Ms. Hansen's request (in her September 8 email) for solutions. She also wanted to explain to Ms. Hansen how she was feeling about things and what a hard time she was having. [95] In the letter, Ms. Perron expressed her views about the terms of her employment, including her view that one of the terms was that, where there was an account conflict, "the business is given to the person that has the most sales in the past year or two." In her view, an account conflict existed because, from Ms. Perron's perspective, Ms. Fedorchuk was selling to

Ms. Perron's client QuadReal through Ms. Fedorchuk's "old account," Edelman. Ms. Perron expressed her view that in 2016, the Edelman account was "up for grabs" because no one had sold to Edelman for more than two years. Ms. Perron said that, instead of Image Group (and Ms. Hansen) giving the Edelman business to her, as the person with the most current sales to Bentall Kennedy, it was given to Ms. Fedorchuk. Ms. Perron expressed her view that this was in breach of the terms in Ms. Hansen's July 12, 2011 e-mail concerning account conflicts. Ms. Perron said: I don't think I am being greedy when I ask Image Group to adhere to its own policies and the terms of my employment contract - to give [the] Edelman business to the person currently servicing the end customer, first Bentall Kennedy and then QuadReal. That person is me. [96] Ms. Perron then went on to express her views and disappointment at the way matters had been handled once she discovered what she described as the "conflict" in early 2017. She complained about what she perceived to be Ms. Hansen's lack of help and Ms. Fedorchuk's lack of co-operation. She repeated her suspicions (based on things she had heard and documents she had seen) that Ms. Fedorchuk had been invoicing and dealing with QuadReal directly. Ms. Perron then proposed her solution, and said in relevant part: Here is my solution. I do not see now, as long as

I am employed at Image Group, my Bentall Kennedy or QuadReal accounts can be assigned to another salesperson, as it is a fundamental term of my employment that both are my accounts. I propose that Image Group should rectify the fundamental breaches of my employment by treating me as the salesperson who has sold all the product to QuadReal directly or indirectly. For the reasons given above I believe I am contractually entitled to the commissions from sales to Edelman, in addition to sales directly to QuadReal - past and future. I should be put back in the position I would be in, if Image Group had adhered to the terms of my employment with regard to Edelman/QuadReal business. [97] Ms. Perron proposed meeting either the following day (Friday, September 22) or September 28 at the latest "to resolve this matter." [98] Ms. Hansen responded by letter dated September 22, 2017, where she said: Dear Janet, I am sorry that QuadReal's decision to place their business through Edelman and not directly with you has caused you so much stress and anxiety. Sherry Lynne has worked with Edelman since 2005, supplying product to the agency on behalf of their customers. Not every project the agency works on requires promotional products. Many quotes have been supplied to them in between projects that have not translated into orders. We measure active accounts by activity and so [Edelman] was not a

dormant account 'up for grabs'. Image Group policies are clear: The sales people have protected accounts. So just as your clients are protected for you, the rest of the sales people's accounts, including Sherry Lynne's, are protected for them. Because QuadReal buys from Edelman does not give you the right to take over the Edelman account. Sherry Lynne as well cannot take over your accounts because her customer supplies products to them. Protected accounts only extend to the accounts registered - not who our customers sell to. I look forward to working with you for many years to come and to help you maximize the business from your accounts. [99] As Ms. Perron recalled, she felt defeated and shocked at Ms. Hansen's response. According to Ms. Perron, she did not understand Ms. Hansen's reasoning, which (in Ms. Perron's view) was contrary to the terms of her employment agreement. Ms. Perron explained that the idea that "activity" (as opposed to sales) counted was totally new to her, and she had never heard this before. Rather, she had understood from her first meeting with Ms. Hansen that provided you had sales in the last two years, the client was yours. [100] As of September 2017, as Ms. Hansen recalled, she noticed that Ms. Perron was distant from others at Image Group, including her. Ms. Perron kept her office door closed. Ms. Hansen understood that the situation was stressful

for Ms. Perron, because she wanted the Edelman account transferred to her. However, Edelman was not Ms. Perron's account. Ms. Hansen explained that she was concerned because Ms. Perron did not trust Image Group, and it was not good for either the company or Ms. Perron to continue like that. However, as Ms. Hansen recalled, every time she and Ms. Perron met to discuss matters, Ms. Perron was sure that Ms. Fedorchuk was selling directly to QuadReal, and nothing Ms. Hansen did or said could convince Ms. Perron otherwise. [101] On November 3, 2017, Ms. De Adder sent an email message to Ms. Hansen, with a copy to Lauren Stewart, who was with Edelman. Ms. De Adder's message read: Hi Laura, On behalf of QuadReal Property Group, I would like to request that Sherry Lynne Fedorchuk be our account representative on all orders placed by QuadReal employees through Image Group. Please note that it was unintentional that we ended up with a separate account representative (Janet Perron) for some of the items we've ordered. We're a large company, and have many bodies looking to source items. We found Image Group independently and made a connection directly through the website, without ever realizing that we were already using Image Group through Edelman, and therefore ended up with two account representatives. Please note that I have been very happy with Janet's service. She has been very

responsive, proactive and creative in sourcing items for us. That being said, Sherry Lynne has been working with QuadReal (through Edelman) since the beginning, and the knowledge of the majority of our items lays with her. I trust that you will make both Sherry Lynne and Janet aware of this email. Janet is in the middle of fulfilling a gift bag order for me that is due to be delivered mid December. She's been absolutely fantastic throughout the process while I've been back and forth on various customizations I wanted to see for the bags. I do hope she'll be able to see this order through. [102] Ms. De Adder was not called as a witness at the trial, nor was anyone else at QuadReal. However, the statements in her email about how the gift bag order came to Ms. Perron ("We found Image Group independently and made a connection directly through the website") are consistent with Ms. Perron's evidence that, even after learning of QuadReal early in 2017, she did little or nothing to market her services directly to her contacts there. [103] Ms. Hansen communicated Ms. De Adder's email to Ms. Perron on November 6, 2017. At trial, Ms. Hansen explained that she had no other practical alternative but to honour Ms. De Adder's (the client's) request to change the QuadReal account from Ms. Perron to Ms. Fedorchuk. That is what Ms. Hansen did. However, she proposed to Ms. Perron that QuadReal

could be handled "like UBC," where the buying centre or property registered to the sales representative would prevail. She told Ms. Perron: "This should be beneficial to you as many of the properties are registered to you." In effect, despite QuadReal being transferred to Ms. Fedorchuk, Ms. Perron would remain the sales representative on the accounts for individual properties. [104] Ms. Perron was devastated at the loss of QuadReal as her account. She did not understand what treating QuadReal "like UBC" meant. [105] On November 10, 2017, Ms. Perron and Ms. Hansen exchanged email about the QuadReal "Look Book" and the change in the QuadReal account representative. Part of this email string included Ms. De Adder's November 3 email to Ms. Hansen. A message from Ms. Hansen to Ms. Perron read in part: . . . [Ms. De Adder] and Edelman have created a 'Look Book' of items they would like to have their properties purchase. Currently these items have been ordered through Edelman and may continue to be for a while. Stefanie [De Adder] also wants to order these items for their properties and have us invoice directly to their properties. Her letter below [i.e., the November 3 email] asks that Sherry Lynne manage this process. Here's how I think this will best work: ● Orders for Look Book items will be placed through Stefanie and invoiced to whichever property they are for ● Sherry Lynne

will manage the Look Book item orders ● You will be paid 15% of Sherry Lynne's commission on all Look Book items that are invoiced directly through Stefanie ● Gillian [at Image Group] will manage this commission split and you will see it as a line item on your pay advise ● You will maintain all your property accounts and service them as you have been I think this is a workable solution. I want to keep the customer happy and not risk them pulling their business from us because we can't work together. . . . [106] In her response, Ms. Perron advised that she would "take a few days to think about your email, & and may have some questions." [107] However, ultimately, what Ms. Hansen had proposed as a solution was not acceptable to Ms. Perron. [108] At trial, Ms. Perron described how extremely stressful she found her situation at Image Group at this time. She also described how it was affecting her physical health. At the beginning of December 2017, she became ill with the flu for two weeks and was away from the office. Then, on December 13, 2017, she resigned from Image Group. [109] On December 15, 2017, Ms. Hansen (on behalf of Image Group) began sending letters to Ms. Perron's clients advising that Ms. Perron was no longer working at Image Group and offering the services of another sales representative (should the client decide to remain with Image Group). The one example of such

correspondence that is in evidence begins: I am writing to let you know that Janet Perron is no longer working at Image Group. Janet was a valuable member of our sales team and we wish her well on her next adventure. [110] This step taken by Ms. Hansen was the subject of much criticism by Ms. Perron in closing submissions, and Ms. Perron relied on in to support her claim for punitive damages. However, objectively, it is a step that any responsible business owner in the position of Ms. Hansen would be expected to take after an employee has left. [111] After leaving Image Group, Ms. Perron continued to sell promotional products to long-time clients, including Noram Engineering, Oakridge Shopping Centre, Highliner Construction, Métis BC and Canadian National Railway, who followed her after she left Image Group. Ms. Perron also continued to do quotes for Bentall Kennedy. She worked for brief periods with two other promotional products companies, but found neither ideal.

3. Discussion and analysis [112] In this section, I will first consider Ms. Perron's claim that she was constructively dismissed. I will then turn to her remaining claims of conspiracy, inducing breach of contract and intentional inference with economic relations. [113] I note that, in her notice of civil claim (the "NCC"), Ms. Perron advanced claims for a remedy based on unjust enrichment and quantum meruit. However, those claims were not pursued in closing argument and I consider them to have been abandoned. In any event, based on my conclusions set out below, they were bound to fail. (a) Ms. Perron's claim of constructive dismissal [114] Before turning to basic legal principles applicable to Ms. Perron's claim for constructive dismissal, I note that in the response to civil claim, Image Group had asserted that, when she joined Image Group, Ms. Perron was not an employee but an independent contractor. Image Group said that this was because Ms. Perron was providing her services through her company, Innovative. However, in closing submissions, Image Group (correctly in my view) abandoned this position. On the facts, there can be little doubt that, from the time she began working at Image Group in early 2012, Ms. Perron was an employee, and not an independent contractor, and, if she was wrongfully dismissed, entitled to notice accordingly. (i) Basic legal principles [115] The

parties agree that Potter v. New Brunswick Legal Aid Services Commission, 2015 SCC 10, sets out the legal principles that apply when a plaintiff asserts she has been constructively dismissed. Wagner J. (as he then was), writing for the majority, said (beginning at para. 30): [30] When an employer's conduct evinces an intention no longer to be bound by the employment contract, the employee has the choice of either accepting that conduct or changes made by the employer, or treating the conduct or changes as a repudiation of the contract by the employer and suing for wrongful dismissal. This was clearly stated in Farber [Farber v. Royal Trust Co., [1997] 1 S.C.R. 846], at para. 33, the leading case on the law of constructive dismissal in Canada. . . . Since the employee has not been formally dismissed, the employer's act is referred to as "constructive dismissal". . . . [31] The burden rests on the employee to establish that he or she has been constructively dismissed. If the employee is successful, he or she is then entitled to damages in lieu of reasonable notice of termination. . . . [32] Given that employment contracts are dynamic in comparison with commercial contracts, courts have properly taken a flexible approach in determining whether the employer's conduct evinced an intention no longer to be bound by the contract. There are two branches of the test that have emerged.

Most often, the court must first identify an express or implied contract term that has been breached, and then determine whether that breach was sufficiently serious to constitute constructive dismissal: [citations omitted]. Typically, the breach in question involves changes to the employee's compensation, work assignments or place of work that are both unilateral and substantial: [citation omitted]. . . . [33] However, an employer's conduct will also constitute constructive dismissal if it more generally shows that the employer intended not to be bound by the contract. In applying Farber, courts have held that an employee can be found to have been constructively dismissed without identifying a specific term that was breached if the employer's treatment of the employee made continued employment intolerable: [citations omitted]. This approach is necessarily retrospective, as it requires consideration of the cumulative effect of past acts by the employer and the determination of whether those acts evinced an intention no longer to be bound by the contract. [34] The first branch of the test for constructive dismissal, the one that requires a review of specific terms of the contract, has two steps: first, the employer's unilateral change must be found to constitute a breach of the employment contract and, second, if it does constitute such a breach, it must be found to

substantially alter an essential term of the contract . . .. . . . [37] At the first step of the analysis, the court must determine objectively whether a breach has occurred. To do so, it must ascertain whether the employer has unilaterally changed the contract. If an express or an implied term gives the employer the authority to make the change, . . . the change is not a unilateral act and therefore will not constitute a breach. If so, it does not amount to constructive dismissal. Moreover, to qualify as a breach, the change must be detrimental to the employee. [38] This first step of the analysis involves a distinct inquiry from the one that must be carried out to determine whether the breach is substantial, although the two have often been conflated by courts in the constructive dismissal context. . . . [39] Once it has been objectively established that a breach has occurred, the court must turn to the second step of the analysis and ask whether, "at the time the [breach occurred], a reasonable person in the same situation as the employee would have felt that the essential terms of the employment contract were being substantially changed" (Farber, at para. 26). A breach that is minor in that it could not be perceived as having substantially changed an essential term of the contract does not amount to constructive dismissal. [40] The kinds of changes that meet these criteria

will depend on the facts of the case being considered, so "one cannot generalize": [citation omitted]. In each case, determining whether an employee has been constructively dismissed is a "highly fact-driven exercise" in which the court must determine whether the changes are reasonable and whether they are within the scope of the employee's job description or employment contract: [citation omitted]. . . . [116] Ms. Perron says that she was constructively dismissed according to both branches of the test in Potter. Image Group says that Ms. Perron has not established liability for constructive dismissal under either branch of that test. [117] Before I turn to the contract terms alleged by Ms. Perron, on the one hand, and by Image Group, on the other, I consider it useful also to set out some basic principles concerning the formation and interpretation of contracts. One of the reasons I do this is because both in the evidence (as I noted above) and in argument, the parties approached both the identification and the interpretation of contract terms based on their subjective understanding and intentions. [118] However, this approach is fundamentally flawed. [119] In one of the leading texts on contract law (G.H.L. Fridman, The Law of Contract in Canada, 6th ed. (Toronto: Thomson Reuters Canada, 2011)), the author says (at p. 15) [underlining added; footnotes omitted]: Constantly

reiterated in the judgments is the idea that the test of agreement for legal purposes is whether the parties have indicated to the outside world, in the form of the objective reasonable bystander, their intention to contract and the terms of such contract. The law is concerned not with the parties' [subjective] intentions but with their manifested intentions. It is not what an individual party believed or understood was the meaning of what the other party said or did that is the criterion of agreement; it is whether a reasonable [person] in the situation of that party would have believed and understood that the other party was consenting to the identical terms. [120] Thus, here, evidence of the individual understandings or beliefs of Ms. Perron or Ms. Hansen or Ms. Fedorchuk about the meaning of provisions, or about what the word "approach" meant or about what was intended by particular contract terms, is irrelevant. What matters is what a reasonable person in the situation of any of those parties would have believed and understood. Moreover, the focus with respect to contested contractual terms is on the actual communications between the parties, not their understandings. This is because determining contractual formation and terms is an exercise based on objective assessment. See, for example, Aubrey v. Teck Highland Valley Copper Partnership, 2017 BCCA 144, at paras. 35 and

48; and Shaw Production Way Holdings Inc. v. Sunvault Energy, Inc., 2018 BCSC 926, at paras. 139 and following. [121] A contract is composed of the terms agreed upon between the parties to constitute their bargain. The first step in contractual interpretation, therefore, is to determine what is to be interpreted. [122] If the parties have reduced the alleged agreement to writing, the starting point for analysis is the wording of the document itself. However, if there is no single document to which reference can be made in order to decide if a contract exists between the parties, then everything that occurs between the parties relevant to the alleged contract must be considered by the court which is faced with the problem of deciding the issue: see Fridman, The Law of Contract in Canada, at p. 16. (ii) The terms of Ms. Perron's contract [123] Some of the terms of Ms. Perron's employment contract are not in dispute. For example, with respect to the entitlement to and payment of commissions, the following terms apply: (a) a sales representative is compensated by receiving commissions in the amount of 50% of the net profits from sales made to the representative's clients; (b) a sales representative is entitled to earn commissions when the representative's client is invoiced for purchasing branded promotional products; (c) Image Group pays commissions to the person who is the sales

representative for the client that is invoiced; and (d) Image Group pays commissions after it collects payment of an invoice from the client. [124] Here, the parties agree that there are two documents that set out contract terms: Ms. Hansen's July 12 email to Ms. Perron, recording their discussions the previous day, and Ms. Hansen's December 22 letter to Ms. Perron. In addition, although there is no evidence that Ms. Perron knew of its existence before she was hired by Image Group, both Ms. Perron and Image Group rely on provisions in Image Group's Sales Manual (Exhibit 4, Tab 117) to support their respective positions concerning the terms of Ms. Perron's contract and the interpretation of those terms. (iii) The Account Conflicts Term [125] For convenience, I will repeat the relevant part of Ms. Hansen's email that Ms. Perron says formed a term of her employment agreement and was breached by Image Group: Account conflicts: Key accounts are not normally an issue. For other accounts that you and Image Group both have I give the business to the person that has the most sales in the past year or two. [126] Ms. Perron describes this term as the "Two-Year Rule." The defendants describe it as the "Conflicts Policy." I will call it the "Account Conflicts Term." [127] Ms. Perron says that the Account Conflicts Term must be interpreted to apply throughout the time she was employed by

Image Group, not merely when she joined as a new sales representative. She says that it was important to her that an objective standard (that is, sales) would be applied generally and throughout her employment with Image Group to resolve conflicts. Ms. Perron says that, when her interpretation of the Account Conflicts Term is applied, the result is that she was entitled to have the Edelman account assigned to her, since Ms. Fedorchuk had not had any sales to Edelman in the two years prior to July 2016. Ms. Perron asserts that Image Group breached the Account Conflicts Term when it failed to transfer the Edelman account from Ms. Fedorchuk to her. Ms. Perron says that all of the defendants "knew" that the Account Conflicts Term applied to protect Ms. Perron's clients, but they set out to deceive Ms. Perron because, applying that Term, Image Group ought to have transferred Edelman to Ms. Perron. She says that Image Group fabricated a "Conflict Rule" (i.e., Image Group's "Conflicts Policy") because it had breached the Account Conflicts Term. Ms. Perron says that Image Group's breach of the Account Conflicts Term and the "concealment" (by not applying it in the way Ms. Perron says it must be applied) of that Term was in bad faith. [128] For its part, Image Group says that that the Account Conflicts Term constitutes a term of Ms. Perron's employment contract. However, Image Group

says that the Term applied only to resolve conflicts and allocate accounts to sales representatives at the point when a person (such as Ms. Perron) joined Image Group as a new sales representative. It did not apply thereafter. [129] I find that the Account Conflicts Term was a term of Ms. Perron's employment contract. [130] However, in my opinion, Ms. Perron's interpretation of the Account Conflicts Term as one that applied throughout her employment with Image Group must be rejected. Rather, in my view, the Account Conflicts Term addressed the point in time when Ms. Perron joined Image Group as a sales representative, and it was intended to address the resolution at that time of any conflicts between Ms. Perron's list of clients and existing Image Group clients. Objectively, and interpreted in its proper context (when Image Group is offering employment as a sales representative to Ms. Perron, and Ms. Perron accepts the offer), the Account Conflicts Term was not intended to address potential conflicts between two existing Image Group sales representatives over a client or clients. In my opinion, Ms. Perron's evidence concerning how important it was to her to have a fair and objective way (through sales) to resolve conflicts is, at best, an after-the-fact reconstruction very much coloured by hindsight. It is not reliable evidence concerning how, objectively, this term of her

employment contract should be interpreted. [131] An interpretation of the Account Conflicts Term as one addressing conflicts only when Ms. Perron joins Image Group (and not thereafter) is reinforced by the words: "for other accounts that you and Image Group both have." A distinction is drawn between Ms. Perron's clients (on the one hand) and Image Group's clients (on the other), and the resolution of those conflicts. Those conflicts, as both Ms. Perron and Ms. Hansen described, were resolved when Ms. Perron joined Image Group and she and Ms. Hansen reviewed and loaded Ms. Perron's clients into Image Group's database. The one "conflict" that was identified - Métis Nation - was resolved in Ms. Perron's favour because Ms. Perron had more sales. However, after Ms. Perron joined Image Group, her accounts became Image Group accounts: there was no distinction between the two and no conflicts to be resolved. [132] In my opinion, the Account Conflicts Term was never intended to apply to the period after the conflicts between Ms. Perron's accounts and Image Group's accounts were resolved when Ms. Perron joined Image Group. Rather, the purpose of the Account Conflicts Term was to resolve any conflicts that existed between a new representative joining Image Group and Image Group's existing clients. [133] From a practical and business perspective, "key accounts" would not normally be an

issue requiring resolution of a conflict between a new representative and Image Group's existing client database because of the improbability of a client being a "key account" in both places, as Ms. Hansen explained. [134] The result is that, because the Account Conflicts Term only applied to resolve client conflicts when Ms. Perron joined Image Group, Ms. Perron cannot rely on this term to say that Edelman should have been transferred to her based on no sales in the previous two years. Image Group did not breach the Account Conflicts Term. (iv) The Client Protection Term [135] Ms. Hansen's December 22 letter sets out further terms of Ms. Perron's employment contract. The precise term in issue is para. no. 5, which I repeat here for convenience: 5. You will use your best efforts to attract and retain clients for Image Group and will ensure that you do not approach any accounts under the protection of other sales representatives of Image Group. [136] This term applied to all Image Group sales representatives. It has two parts: use of "best efforts" to attract and retain clients for Image Group; and a prohibition against approaching accounts "under the protection of" other sales representatives. The main dispute here concerns the meaning of the second part, which I will call the "Client Protection Term." [137] I find that an account "under the protection of" a particular sales

representative means that the account is listed under the name of that sales representative in Image Group's database. For example, Edelman was listed under Ms. Fedorchuk's name, and was therefore under the protection of Ms. Fedorchuk. The client BCIMC - Bayview Mews, for example, was listed under Ms. Perron's name and was therefore under the protection of Ms. Perron. [138] The Client Protection Term is relevant to handling potential client conflicts between Image Group sales representatives. It made the existence of actual client conflicts between sales representatives unlikely. Image Group's database was designed in such a way as to avoid such conflicts, because (as Ms. Hansen described) a representative could not enter as her client or potential client an account that was listed under the name of, and therefore was "under the protection of," another sales representative. The Client Protection Term in effect required a sales representative to make appropriate inquiries of the database in advance of pursuing business with someone, to ensure that the sales representative was not approaching an account already under the protection of another sales representative. [139] In practice, if a sales representative wished to pursue business with someone that was under the protection of another representative, the sales representative wishing to pursue business would (at the very least)

have to communicate with the client's current sales representative in advance of an approach. On a proper interpretation of the Client Protection Term, unless the current sales representative agreed to give up the client, the sales representative wishing to pursue business could go no further without being in breach of that Term. The handling of Rocky Mountain Tours illustrates the practical application of the Client Protection Term. [140] On the other hand, when Ms. Fedorchuk began working on the project for Edelman in 2016, she was able to register QuadReal under her name as a prospect (that is, a potential client) because QuadReal was not listed at all in the database. in other words, QuadReal was not a client under the protection of anyone. I conclude that the reason Ms. Fedorchuk did not register QuadReal under her name as a client was because her client was Edelman, and pursuing business directly with QuadReal would have placed her in a conflict with her own client. [141] Ms. Perron seeks to have the Client Protection Term interpreted as subject to a proviso, to the effect that if the incumbent sales representatives had not made sales to the client for one to two years (applying what Ms. Perron described as the "Two-Year Rule"), then the client's business would be given to a new representative. In other words, according to Ms. Perron, the Client Protection Term applies

only for (at most) two years after the last sale. [142] To arrive at this result, Ms. Perron seeks to have the Account Conflicts Term read into or together with the Client Protection Term. I have set out above why I have concluded that the Account Conflicts Term only applies when a new representative is joining Image Group. It does not apply thereafter to resolve conflicts or potential conflicts between sales representatives, and it cannot be read into the Client Protection Term. [143] However, Ms. Perron advances an additional argument to support her position that the Client Protection Term operated for a maximum of two years from the last sale, after which the client was "up for grabs." Ms. Perron says that her interpretation of the Client Protection Term should be found to be an Image Group policy (and therefore part of her employment contract), based on some of the contents of the 2010 Sales Manual, and some of the contents of an earlier sales manual referred to in Gardner v. IG Image Group, 1996 CanLII 3179, at para. 7. [144] Specifically, Ms. Perron relies on the following statement on p. 11 of the 2010 Sales Manual: ● Review our internal database to make sure the name is up for grabs. If it's been inactive for 24 months, it's yours, but a courtesy call to the assigned rep is strongly advised. [145] Ms. Perron says that, when she investigated the Edelman account in the

internal database, there had been no sales between early 2013 and July 2016. Therefore, Ms. Perron says, since clients were protected only for two years, Edelman was "up for grabs." Ms. Perron says that Edelman should have been transferred to her, rather than remain with Ms. Fedorchuk, and that Image Group breached her employment contract in a substantial way by not making the transfer. [146] However, in my view, neither the excerpt quoted in Gardner nor the excerpt from the 2010 Sales Manual can be elevated to a contractual term in the way that Ms. Perron seeks. [147] It is important to look at the context in which the excerpt appears in the 2010 Sales Manual. It is in a section headed "The Image Group Sales Funnel," which begins with a discussion of how to identify potential businesses where Image Group can offer its products. One of the "Sources of Prospects" listed is "Dormant Account Lists," which are described as follows: Dormant accounts are those that have not ordered anything from The Image Group in the past eighteen months. Further research is required to determine why they no longer order from The Image Group and with whom the relationship was before the split. [148] There was no evidence that Edelman was ever listed on a "Dormant Account List." Even if it had been, further research would have been required to determine whether it was a legitimate prospect available

as a client to someone other than Ms. Fedorchuk. [149] Ms. Hansen explained that, to determine whether an account is in fact dormant, a sales representative interested in the account needs to do some investigation to determine the status of the account. In other words, on its own, the lack of sales over a period of time is not determinative of anything. There may be valid reasons for the lack of sales. The incumbent representative may have remained in contact with the client despite the lack of sales, so that there is activity (although not sales activity) on the account. Moreover, the decision whether or not to give up an account belongs to the incumbent representative. [150] In my view, investigating the status of the account - to determine whether it was in fact "up for grabs" - would necessarily involve having some communication with the incumbent representative. However, Ms. Perron never had any such communication with Ms. Fedorchuk. Ms. Fedorchuk had been asked by another representative whether she was interested in transferring Edelman to that representative, who had a family relationship with an Edelman employee. However, her answer was no. Both Ms. Fedorchuk and Ms. Hansen explained why advertising agencies such as Edelman may be infrequent or irregular purchasers from Image Group, as Edelman's purchases are often project-based. The explanation was credible and

reasonable. [151] When Ms. Perron discovered the packing slip in the warehouse in January 2017, Ms. Fedorchuk had been selling to Edelman for about six months. The account was clearly not "dormant" at that stage. Ms. Perron made no attempt to have Edelman transferred to her, and expressed no interest in the account, in the period in which she says it was "up for grabs," that is, prior to July 2016. There is no evidence Ms. Perron even knew of the account's existence. [152] I find that Ms. Perron had no contractual right to have the Edelman account transferred to her. The "Two Year Rule" as pleaded by Ms. Perron did not exist as a term of her employment contract. Moreover, there is no basis for Ms. Perron's claim that the defendants set out in any way to deceive Ms. Perron or, acting in bad faith, fabricated a "Conflict Rule." [153] However, Ms. Perron says that Image Group nevertheless breached the Client Protection Term because Ms. Fedorchuk's work for Edelman was an "approach" to Ms. Perron's client QuadReal. [154] Ms. Perron says that Ms. Fedorchuk's registration of QuadReal under her name was a direct approach and prohibited. I do not agree. As I have noted above, at the time Ms. Fedorchuk registered QuadReal under her name as a prospect, QuadReal was not registered to, and therefore was not under the protection of, any other Image Group sales representative. Moreover, Ms.

Fedorchuk knew virtually nothing about QuadReal's background. When that background became known in early 2017, QuadReal was transferred to Ms. Perron without any argument or contest. [155] However, Ms. Perron says that Ms. Fedorchuk set about getting QuadReal back by "encroaching" - in effect making a prohibited approach to Ms. Perron's client. Ms. Perron says that Ms. Fedorchuk gradually took control and possession of QuadReal, in a way that Ms. Fedorchuk calculated would go unnoticed by Ms. Perron and that would not be prohibited by Image Group because of the interposition of Edelman. Ms. Perron says that Ms. Fedorchuk used Edelman as a vehicle to learn everything she would need to know in order to fully exploit the QuadReal account and take it over. Ms. Perron says that Ms. Fedorchuk made herself indispensable to Edelman's assignment for QuadReal, so that when Edelman was preparing to end its work for QuadReal, she, and not Ms. Perron, was the one positioned to provide continuity for QuadReal, because she had all of the product knowledge. [156] I reject Ms. Perron's characterization of the work Ms. Fedorchuk did for Edelman as either a prohibited "approach" to Ms. Perron's client QuadReal or a breach of the Client Protection Term. [157] I find that until the QuadReal account was transferred to her in November 2017, Ms. Fedorchuk had no contact at all with QuadReal. Ms.

Fedorchuk was very careful about this, and, therefore, very careful not to approach a client under the protection of Ms. Perron. Not only was Ms. Fedorchuk aware of the Client Protection Term and took care to honour it (despite Ms. Perron's suspicions to the contrary), Ms. Fedorchuk also did not wish to do anything that might undermine or interfere with the relationship between her client Edelman and Edelman's client QuadReal. For someone who wants to maintain a successful career as a sales representative, this makes sense. Ms. Fedorchuk could not use the knowledge she gained about QuadReal through her work with Edelman to pursue QuadReal as a client, so long as she was working for Edelman. In fact, she did not do this, and she was careful to communicate to Edelman that she could not do this. To say, as Ms. Perron does, that Ms. Fedorchuk's work for her own client, Edelman, was a prohibited "approach" to QuadReal is a distortion of the facts. [158] The Client Protection Term required that all Image Group sales representatives not approach any accounts under the protection of another sales representative. However, it did not protect a sales representative against business decisions made by a client. The client is the ultimate decision-maker. [159] On the facts, QuadReal decided to hire Edelman to handle (among other things) the new branding. That was not a decision either Image

Group or Ms. Perron or Ms. Fedorchuk had any control over. Edelman was not Ms. Perron's client, and she had no contractual right to insist that it become her client. Her unhappiness stemmed from these fundamental facts. [160] I find, therefore, that Ms. Perron has failed to show that the Client Protection Term was breached because of Ms. Fedorchuk's work with Edelman. (v) Unilateral transfer of an account on the client's request [161] Ms. Perron says next that there was no term of her employment contract that allowed Image Group, unilaterally, to transfer one of her clients to another representative, as Ms. Hansen did with QuadReal in November 2017. Moreover, Ms. Perron says that such a possibility was never discussed with her at any time when she was considering joining Image Group. Ms. Perron says that, given the importance of QuadReal to her client base and her ability to earn commission income, the transfer amounted to a substantial change in the terms of her employment (specifically, her income) and therefore a constructive dismissal. [162] Image Group says that its ability to transfer the QuadReal account flowed from a policy and practice in the sales industry generally that focusses on client service and retention, and that includes a practice of honouring a client's request to change sales representatives. Image Group accepts that a unilateral reduction by the employer

of the employee's compensation can constitute a substantial breach of the employment contract, so that the employee is entitled to consider herself constructively dismissed. However, Image Group says (citing BMO Nesbitt Burns Inc. v. Bond, 2002 CanLII 3184 (ONSC), at para. 18), that where terms of employment do not guarantee an employee to a particular income or commission level, and an employee knows that an adjustment could be made at any point during the employment, a change in remuneration does not constitute constructive dismissal. [163] I agree with Image Group. [164] In my view, the lack of any specific discussion between Ms. Hansen and Ms. Perron about the possibility Ms. Perron may lose a client where the client requested, or decided to make, a change in representation is irrelevant. I do not believe that an experienced sales person such as Ms. Perron would need to be told such a thing. Rather, the possibility of losing a client was inherent in the nature of the business. A sales representative, even a hard-working, skilled and experienced representative such as Ms. Perron, was not protected against decisions made by a client. [165] There was no term of Ms. Perron's employment agreement that guaranteed her a particular level of income. Ultimately, Ms. Perron's income would depend on her sales performance. Even though, in 2017, QuadReal was buying promotional products

mostly through Edelman and not Image Group, Ms. Perron's income increased over her income in 2016. After November 3, 2017, QuadReal was no longer Ms. Perron's account. However, Bentall Kennedy, BCIMC and individual properties (such as Bauer Place) remained Ms. Perron's clients. Moreover, Ms. Hansen offered Ms. Perron 15% of the commissions earned by Ms. Fedorchuk on QuadReal purchases from the Look Book. I am not persuaded that, on the facts, the transfer of QuadReal to Ms. Fedorchuk altered a substantial term of Ms. Perron's employment agreement. (vi) "Honest performance" [166] Ms. Perron says that it was a term of her employment contract that Image Group would honestly perform the employment contract, which it failed to do. Ms. Perron says that Image Group was not honest, reasonable, candid or forthright with her about Ms. Fedorchuk's "encroachment" on QuadReal, or about the handling of what Ms. Perron perceived to be the account conflict concerning Edelman and the transfer of QuadReal. Ms. Perron says that Image Group and Ms. Hansen knowingly withheld information from her about all of these matters. Ms. Perron says that, by failing to perform its obligation honestly, Image Group constructively dismissed her. [167] In support of her position concerning honest performance, Ms. Perron relies on Bhasin v. Hrynew, 2014 SCC 71, in particular the discussion beginning at para. 63

and following. At para. 72, Cromwell J. posed the question whether the Court "ought to create a new common law duty under the broad umbrella of the organizing principle of good faith performance of contracts." His answer was, yes: [73] In my view, we should. I would hold that there is a general duty of honesty in contractual performance. This means simply that parties must not lie or otherwise knowingly mislead each other about matters directly linked to the performance of the contract. This does not impose a duty of loyalty or of disclosure or require a party to forego advantages flowing from the contract; it is a simple requirement not to lie or mislead the other party about one's contractual performance. Recognizing a duty of honest performance flowing directly from the common law organizing principle of good faith is a modest, incremental step. . . . [168] In Potter, at para. 99, Wagner J. (as he then was) cited Bhasin (at para. 66) for the proposition that, "[a]t a minimum, acting in good faith in relation to contractual dealings means being honest, reasonable, candid, and forthright." [169] However, in my view, Ms. Perron's argument that Image Group breached its obligations fails on the facts. [170] In the light of my findings above, Ms. Perron's view of the interpretation of the Account Conflicts Term and the Client Protection Term was incorrect. Image Group did not

breach either of those terms. Ms. Perron never had any contractual right to have the Edelman account transferred to her. There was no unreasonable exercise of discretion in relation to who was to be Edelman's account representative. QuadReal's request to be transferred to Ms. Fedorchuk came as a surprise to Ms. Hansen, and she responded in the manner of a responsible business owner. Ms. Fedorchuk's only communications were with her client Edelman. Information was not hidden from Ms. Perron in breach of any contractual obligation. On the contrary, Ms. Hansen did her best to respond to Ms. Perron's many queries. Her responses were accurate and reflected the facts. No one lied to or knowingly misled Ms. Perron about anything. That Ms. Perron's suspicions continued unabated was not the result of any breach of a duty of honest performance on the part of Image Group. Rather, as Ms. Hansen observed, Ms. Perron simply could not be persuaded that her beliefs and suspicions did not reflect the facts. (vii) Did Image Group's conduct make continued employment intolerable? [171] Finally, Ms. Perron says that Image Group's conduct toward her made her continued employment intolerable, effectively leaving her no other choice but to resign. This is the "second branch" in Potter. [172] I accept that Ms. Perron found working at Image Group in 2017 very stressful and quite unpleasant, as she

described. Ms. Hansen was aware of Ms. Perron's ever-increasing isolation and feelings of mistrust. There were matters of concern and unhappiness for Ms. Hansen, who, I find, had genuine regard and respect for Ms. Perron's abilities as a sales representative, and valued her as an employee. I find that Ms. Hansen's expression of regret the email sent to Ms. Perron at the end of March and in Ms. Hansen's September 22, 2017 letter to Ms. Perron was honest and sincere. When Ms. De Adder communicated QuadReal's decision to Ms. Hansen in early November 2017, Ms. Hansen suggested a solution to possibly soften the blow for Ms. Perron. Unfortunately, it did not. [173] In my opinion, despite Ms. Hansen's efforts to explain, accurately, the facts to Ms. Perron, Ms. Perron was never able to accept that her belief that Ms. Fedorchuk was wrongfully encroaching on Ms. Perron's clients QuadReal and Bentall Kennedy was not justified. Ms. Perron was never prepared or able to accept what Ms. Hansen was telling her. Rather, Ms. Perron was utterly and unmovably convinced that her perspective was correct. As of the trial, Ms. Perron's perspective had not changed, and she continued to assert that Ms. Hansen and Ms. Fedorchuk were deliberately deceiving her. However, Ms. Perron's perspective was not correct. It had no basis in the facts. [174] In my view, there was nothing in Image Group's (and

specifically, Ms. Hansen's) treatment of Ms. Perron that showed any intention no longer to be bound by the employment contract. Ms. Perron was never treated in anything less than a respectful way. Ms. Hansen's expression of her frustration in her September 8 email was directed at both Ms. Perron and Ms. Fedorchuk. Most regrettably, Ms. Perron's perception that she was being mistreated and bullied by her employer was based on her incorrect interpretation of her contractual rights and her steadfast refusal to accept that what Ms. Hansen was telling her was true. Ms. Perron's mistrust was not justified. Ms. Fedorchuk did nothing to create or fuel conflict with Ms. Perron. Ms. Fedorchuk's conduct in dealing with the needs of her client Edelman upset Ms. Perron, but it cannot provide grounds to justify Ms. Perron's claim that she was constructively dismissed. It was business, and never personal. Ms. Perron's perception and mistrust cannot provide a basis to say that Image Group's conduct demonstrated an intention no longer to be bound by the employment contract. [175] Accordingly, I find that Image Group's conduct toward Ms. Perron was not such as to render continued employment beyond what an employee may be reasonably expected to bear. (viii) Summary regarding Ms. Perron's claim of constructive dismissal [176] In summary, I find that Ms. Perron has failed to show that she was

constructively dismissed from her employment. [177] As I have concluded that Image Group has no liability for constructive dismissal, I decline to consider matters concerning appropriate notice or other damages claimed by Ms. Perron premised on a finding of liability against Image Group. (b) Ms. Perron's conspiracy claim [178] In the NCC, Ms. Perron pleads (at para. 43): The Defendants participated in a conspiracy to intentionally engage in unlawful conduct in breach of the Employment [contract], when they knew or ought to have known that such conduct would likely cause harm to Perron. [179] No particulars were pleaded. However, in closing submissions, some particulars were set out as follows (at para. 108 of the written submissions): 108. There is sufficient evidence to infer that Ms. Hansen and Ms. Fedorchuk acted in concert, that is conspired, to: a. Violate Image Group's prohibition on encroachment, and induce Image Group to breach its contractual duty to uphold the prohibition; b. Interfere in Ms. Perron's economic relations with QuadReal; c. Conceal and withhold information from Ms. Perron, inducing Image Group to breach its duty of honest performance of Ms. Perron's employment; and d. Induce Image Group to transfer QuadReal to Ms. Fedorchuk, in breach of Ms. Perron's employment. [180] The elements of a conspiracy claim are conveniently summarized in ICBC v. Atwal, 2012

BCCA 12, at paras. 27-28: [27] The tort of conspiracy exists if two or more persons agree and combine together to carry out a common design, or to achieve a common goal, by acting unlawfully, or by carrying out a lawful act by unlawful means, with the predominant purpose of causing injury to the plaintiff, where the likelihood of injury to the plaintiff is known or should have been known to the defendants in the circumstances. [citations omitted]. [28] Mr. Justice Lowry, for the Court in Golden Capital Securities Limited v. Rempel, 2004 BCCA 565, provided the following helpful summary of the tort of conspiracy: [47] Thus, to prove a case in conspiracy, it is first necessary to plainly establish, directly or by inference, that there was an agreement between the defendant and one or more others. That does not mean an agreement in the contractual sense. A defendant must be shown to have agreed in the sense of having combined or conspired with one or more others to carry out a common design or a means of achieving a common objective, which is then implemented with resulting injury to the plaintiff. [48] Where the means are unlawful, there must also be proof that the unlawful conduct was directed toward the plaintiff and that the likelihood of injury to the plaintiff was or should have been known to the defendant. [181] In my opinion, Ms. Perron's conspiracy claim must fail on the

facts. [182] Contrary to Ms. Perron's submission, the evidence does not support the conclusion that Ms. Hansen and Ms. Fedorchuk conspired together to breach the Client Protection Term or to induce Image Group to breach that term. Indeed, based on my findings above, that term was never breached. As I will discuss below, Ms. Perron has neither pleaded nor proved a claim for intentional interference with her economic relations with QuadReal. The evidence does not support the assertion that any of the defendants conspired together to interfere with Ms. Perron's relationship with QuadReal. Moreover, on the available evidence, the decision to change sales representatives was one made by QuadReal itself. There was no unlawful conduct on the part of any of the defendants that brought about that result. [183] I have found above that there was no breach of Image Group's duty of honest performance. I have also found that Ms. Hansen responded in a reasonable way to Ms. Perron's inquiries, and the information provided to Ms. Perron was accurate. Ms. Hansen's conduct in dealing with Ms. Perron is inconsistent with the existence of any conspiracy between Ms. Hansen and Ms. Fedorchuk. I find that nothing was concealed or withheld from Ms. Perron so as to provide any basis for an actionable conspiracy. [184] I deal below with Ms. Perron's claim for inducing breach of contract. It cannot

support her conspiracy claim. [185] Accordingly, it follows that Ms. Perron's conspiracy claim must be dismissed. (c) Ms. Perron's inducing breach of contract claim [186] Ms. Perron asserts (NCC, para. 42) that Ms. Hansen and Ms. Fedorchuk intentionally and unlawfully engaged in activities that induced Image Group to breach the employment contract with Ms. Perron. [187] Ms. Hansen and Ms. Fedorchuk say that Ms. Perron has failed to prove such a claim. [188] To establish liability for the tort of inducing breach of contract, a plaintiff must prove all of the following elements: (a) the existence of a contract; (b) the defendant was or can be assumed to have been aware of the existence of the contract; (c) the defendant intended to cause the breach; (d) the defendant caused or induced a breach; and (e) the plaintiff suffered damage as a result. See Super-Save Enterprises Ltd. v. Del's Propane Ltd., 2004 BCCA 183, at para. 2. [189] The first two elements have been established. However, the remainder have not. [190] As Ms. Perron has failed to establish all of the element of the tort, it follows that her claim for inducing breach of contract must be dismissed. (d) Ms. Perron's claim of intentional interference with economic relations [191] In the NCC, Ms. Perron pleaded (at para. 42): . . . The Defendants intentionally and unlawfully engaged in activities that interfered with

Perron's economic relations with QuadReal. [192] The essential elements of the tort of intentional interference with economic relations are: (1) the defendant intended to injure the plaintiff's economic interests; (2) the interference was by illegal or unlawful means; and (3) the plaintiff suffered economic loss or harm as a result. See Pro‑Sys Consultants Ltd. v. Microsoft Corporation, 2013 SCC 57, at para. 81. [193] In A.I. Enterprises Ltd. v. Bram Enterprises Ltd., 2014 SCC 12 (CanLII), Cromwell J. (for the court) explained the "illegal means" requirement. He wrote [underlining added]: [23] The unlawful means tort creates a type of "parasitic" liability in a three-party situation: it allows a plaintiff to sue a defendant for economic loss resulting from the defendant's unlawful act against a third party. Liability to the plaintiff is based on (or parasitic upon) the defendant's unlawful act against the third party. While the elements of the tort have been described in a number of ways, its core captures the intentional infliction of economic injury on C (the plaintiff) by A (the defendant)'s use of unlawful means against B (the third party): [citations omitted]. There is no dispute here that this is an intentional tort; the focus of the dispute in this case is on the unlawful means element. . . . [26] The scope of the unlawful means tort depends on the answers to three

questions. First, does the unlawful conduct have to be actionable by the person at whom it is immediately directed? In my view, the conduct must be an actionable civil wrong or conduct that would be actionable if it had caused loss to the person at whom it was directed. . . . [194] Cromwell J. concluded on this essential element [underlining added]: [76] I conclude that in order for conduct to constitute "unlawful means" for this tort, the conduct must give rise to a civil cause of action by the third party or would do so if the third party had suffered loss as a result of that conduct. [195] Here, Ms. Perron has neither pleaded nor proved any conduct on the part of any of the defendants against any third party that would give rise to a civil cause of action by that third party. [196] It follows that this claim must be dismissed.

4. Summary and disposition [197] In summary, the plaintiff's claims are dismissed. [198] Subject to any submissions the parties wish to make concerning costs, the defendants are entitled to costs (one set) on Scale B. If the parties wish to make submissions concerning costs, I direct that appropriate steps be taken within 30 days of the date of these Reasons to obtain a convenient hearing date from Scheduling. "ADAIR J."