Jack Cewe Ltd. v. Jorgenson

Jack Cewe Ltd. v. Jorgenson

The appeal was dismissed: the Court held that no deduction for income tax should be made because it would be illogical to allow a deduction for tax not payable; and unemployment insurance benefits paid to the plaintiff cannot be deducted from damages because such benefits are a consequence of the contract of employment and flow from employer contributions.

Citation
[1980] 1 SCR 812
Parties
Defendant/appellant: Jack Cewe Ltd.; Plaintiff/respondent: Gary William Jorgenson
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
22 April 1980
Procedural Posture
Wrongful Dismissal (employment Law) / Appeal to the Supreme Court of Canada From the Court of Appeal for British Columbia
Outcome
Appeal dismissed with costs
Legal Topics
Wrongful Dismissal, Damages, Income Tax Deductibility, Unemployment Insurance Benefits, Deductions From Damages
Source Language
English
Labour Law Employment Law Taxation Social Security (unemployment Insurance) Wrongful Dismissal Damages Income Tax Deductibility Unemployment Insurance Benefits +1 more

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Parties

Jack Cewe Ltd.

Defendant/appellant

Gary William Jorgenson

Plaintiff/respondent

Procedural Posture

Wrongful Dismissal (employment Law) / Appeal to the Supreme Court of Canada From the Court of Appeal for British Columbia

Legal Issues

  1. 1 Whether a deduction should be made from damages for income tax on the award for wrongful dismissal
  2. 2 Whether unemployment insurance benefits received by the plaintiff should be deducted from damages in proportion to the employer’s contribution

Ratio Decidendi

The appeal was dismissed: the Court held that no deduction for income tax should be made because it would be illogical to allow a deduction for tax not payable; and unemployment insurance benefits paid to the plaintiff cannot be deducted from damages because such benefits are a consequence of the contract of employment and flow from employer contributions.

Court Disposition

Appeal dismissed with costs

Orders

  • Appeal dismissed with costs.
  • No deduction for income tax from the wrongful dismissal damages award.