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City loses civil suit, owes thousands to former chief official
A former City of Terrace employee terminated in what he said was his "forced resignation" has won his civil case against the city.
Don Ramsay was hired as the city's chief administrative officer (CAO) in March 2012 after then-CAO Ron Poole quit to take a similar job in Kitimat.
Before that, Ramsay had been the northwest district manager for the Ministry of Transportation, based in Terrace.
In June 2012, Ramsay resigned and claimed in a civil suit filed November 2012 that he was asking "for damages arising from what he says was his forced resignation from employment" as the city's CAO, said Mister Justice Macintosh of BC Supreme Court in his written judgment from the trial of June 17 to 20, 2014.
He ruled that Ramsay was denied his right to a hearing and right to be told what the case was against him.
"In summary, I award damages equivalent to six months of the plaintiff's salary as of June 26, 2012, together with any other payments the plaintiff would have received from Terrace, had he been dismissed without cause on six months' notice as an employee not on probation..." said Macintosh in his written statement, adding that included Ramsay's legal costs.
Six months of Ramsay's annual salary of $133,000 as of that date is $66,500.
The city, in its reply, said Ramsay resigned voluntarily and that he was entitled to receive pay in lieu of notice of two weeks in accordance with his resignation agreement, said the judgment.
And because Ramsay was on probation when his employment ended, proving cause for dismissal, or giving notice beyond the two weeks in the letter of resignation, was unnecessary, and the only relevant question was his suitability for the job, continued the city's reply in the judgment.
The terms of employment had said there was a one-year probation period with performance reviews held quarterly during that time, said the judgment.
Mister Justice Macintosh found that Ramsay "invited feedback in the course of his work, but he almost never received it. The mayor, who is employed elsewhere full-time, spent little time with the plaintiff discussing his job performance. Any criticisms were subtle and rare."
At the trial, some evidence was given about Ramsay's handling of three files: one addressing a third railway crossing in town, the second the use of an old school building and the closing of the town's cemetery to motor vehicles, continued the judgment.
"But from the evidence, even the most sensitive employee in the plaintiff's shoes would not have entertained any serious concern about his continued employment based on those three matters," said Macintosh.
On June 26 2012, after an in-camera meeting in which mayor and council discussed Ramsay's evaluation results, Pernarowski met with Ramsay in Ramsay's office at 4 p.m., the judgment said.
Pernarowski told Ramsay the review had not gone well and gave him a letter that read:
"...Based on the results of the review, council has determined that you are not suitable in the position and has recommended that your employment be terminated."
It continued by saying the Community Charter, which governs municipalities, allowed for termination of a municipal officer as long as the officer is given a chance to be heard by council and given reasonable notice, or compensation in lieu of notice and that an employee is entitled to one week's wages as compensation after three consecutive months of employment, said the judgment.
The city offered him the chance to resign with a severance package of two weeks' wages in return to agreeing to waive the right to a hearing, the judgment continued.
If Ramsay did not accept the offer, he would be suspended effectively immediately and an in-camera council meeting would be scheduled to give him the chance to be heard, the judgment said.
A redacted copy of Ramsay's six-page quarterly performance evaluation contained details that "were devastating and yet uninformative," the judgment said.
Ramsay's scores on his evaluation, which could be ranked from a low of one to a high of five for each item, averaged 1.8, the judgment continued.
"The document ... contained no commentary and no facts. It did not provide reference to a single incident or contain a single particular of Mr. Ramsay's conduct which apparently was complained of," said the justice.
In his testimony at trial, Pernarowski said repeatedly that if Ramsay had not resigned and had requested a hearing, he would've been given the particulars necessary for him to defend himself at the council hearing, said the judgment.
"But that was never said to Mr. Ramsay in the June 26 meeting. Nor did he have any reason to think he ever would see particulars. The mayor told Mr. Ramsay in the meeting that he, the mayor, was not leaving Mr. Ramsay's office until Mr. Ramsay either resigned in writing or elected the suspension with the termination hearing, with a week's less pay...if he did not succeed in removing the suspension and getting his job back at the hearing," said the judgment.
"As the plaintiff expressed it at trial and in the meeting with the mayor, quoting from my notes of evidence, 'It seems crazy to charge a week's wages for a hearing I have no chance of winning.'
"The plaintiff was trying to absorb what had happened and was told he had to decide then and there. There was some difference between the mayor and Mr. Ramsay in recalling what was said. Where there were differences in the recollections of the mayor and the plaintiff concerning that meeting, I prefer the reliability of the plaintiff's recollection. I do not mean to, and I do not, impugn the mayor's integrity. The meeting was difficult for both men, but the events of the meeting understandably are seared in the plaintiff's memory and I accept his recounting of them. I note that he made an eight or 10-page summary of the events within a week or two of the June 26, which was undoubtedly of assistance in his recollections," said Macintosh in his judgment.
Ramsay began the civil action in November 2012, said the judgment.
"Mr. Ramsay was deprived of his hearing rights, because he was never informed of the case against him....On the contrary, he reasonably believed he would have to enter a hearing unarmed by not knowing anything further. In the result, in my view, his decision to resign was uninformed and it was the fault of Terrace that it was uninformed," said Macintosh, adding that an uninformed decision to resign cannot be voluntary.
"I note from the council's in-camera minutes of its June 26 meeting, that council discussed what process to follow for replacing Mr. Ramsay, who they were suspending that day if he did not resign. The mayor was already advised, according to the minutes, to approach a former CAO about finding the next CAO. An interim CAO was appointed the same day. Soon after, she became the new permanent CAO, Mr. Ramsay's successor," said Macintosh.
City official Heather Avison then took on the role of interim chief administrative officer, a position she had also undertaken after Poole left in summer 2011, before returning to corporate administrator when Ramsay was hired.
She was subsequently named permanent CAO.
"The reality here was one of telling Mr. Ramsay to quit or be fired. Any more generous description would ignore that Mr. Ramsay was not given particulars to prepare him for a hearing," said Macintosh.
Mister Justice Macintosh did not accept Ramsay's submission "that the severance agreement was unconscionable."
"The error Terrace committed, in my view, was to effectively deny Mr. Ramsay a fair hearing by not particularizing the complaints in a way that he could address them. I view that as having been a mistake and a breach of a requirement of Terrace, rather than an intended unfairness so as to raise a resulting presumption of fraud...."
Macintosh also denied Ramsay's request of punitive damages saying although the city's conduct was in breach of its contractual obligations to Ramsay and statutory obligations, "It was not, however, in my view, malicious or high handed...."
When asked Ramsay said the amount he believed was to total "50 per cent of annual salary plus costs of the suit. Truly do not know at this time."
Avison said the city did not know exactly how much the total would be yet.
"We haven't received that information from our lawyer yet so I'm not able to provide it at this time," she said by email.
Pernarowski said that performance evaluations for the CAO are conducted by the mayor and council with input from senior city management, the people in charge of each city department.