While it is fairly common for terms of an employment contract to
be partially written and partially oral, the oral terms tend to be
more nebulous. In James v. The Hollypark Organization
Inc., 2016 BCSC 495, the dispute centered on the existence of
an oral term.
The parties did not enter into a written contract. It was,
however, common ground that the employee was hired around spring
2013 and terminated without cause in August 2013. The dispute
was whether the employment was for a fixed term of one year.
The B.C. Supreme Court laid out the principles which apply to
alleged oral contracts: the onus is on the employee to prove it was
a fixed term contract; such contracts can be created orally where
the intention is clearly expressed or necessarily implied on an
ad item (meeting of the minds) basis; oral discussions
should allow a reasonable observer to conclude the employment was
for a fixed term; and there is greater flexibility in the evidence
admissible to prove a completely oral contract because the court
does not have the benefit of the words of the agreement.
Assuming there was a fixed term contract, damages are in respect of
the unexpired portion of the fixed term less any earnings in
The employer was building a new hotel and looking to have the
Marriott as the franchisor. The employee had previous training and
experience in opening and operating a Marriott. Originally,
the employee provided consulting services to the employer from
April 2012 to May 2013.
The employer's contractual obligations (the Franchise
Agreement) with Marriott required an employee who had Marriott
training to oversee the new hotel for the first year (which started
four months prior to opening). The employee argued that a one year
fixed term contract was agreed. She relied on an August 2012
conversation with a Marriott representative, the employer and the
employee. Essentially, the employee submitted that the
parties and Marriott agreed she had the necessary training and
experience and the employment would be for a one year term.
If the employer did not have the employee, it would have had to
engage a more expensive, third-party management company pursuant to
the Franchise Agreement.
Additional evidence to support the fixed term included: the
employee moved to Vernon to be closer to the project; the employee
e-mailed the employer a proposed salary breakdown for a one year
term; the employer sent an e-mail to the employee and others that
implied she would be around well into 2014; and 500 business cards
were made naming the employee as the General Manager.
The employer argued that the Marriott was satisfied with the
employee being involved as a consultant and there was no discussion
of a fixed term of employment. Notably, the Marriott witness was
not called by either side to substantiate any claim in the
The Court did not accept that Marriott would have waived its
requirements to have a trained manager oversee the first year,
especially in light of the fact that the principal of the employer
was young, inexperienced and not Marriot trained. The lack of any
Marriott agreement expressly stating that the employee was to be
hired by the employer was not, the Court ruled, fatal to its
While the Court recognized that the evidence was not definitive,
it was more consistent with the employee's account of
Regarding damages, the Court found that the employee did not
fail to mitigate when she travelled to Mexico for an extended
period. The employee's evidence was that her job search
continued from Mexico and she was prepared to return to attend to
any reasonable job prospect. The employer was unable to show
that the employee missed any opportunity by being in Mexico.
1. Important employment terms should be reduced to a written
2. Inclusion of an "entire agreement" or "no
previous representation" provision in the written employment
contract will reduce an employer's exposure to alleged oral
3. A wide range of evidence will be considered to determine the
existence of an oral term. It is thus important that the
employer's conduct be consistent with its understanding of the
Previously printed in the LexisNexis Labour Notes
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