SCC Rules No Grounds for Aggravated or Punitive Damages

The Supreme Court of Canada today released its much anticipated decision in Honda Canada Inc. v. Keays.

By a 7-2 majority, the Court set aside an award of additional damages for the manner of dismissal and a $100,000 award of punitive damages. The Court also adopted a new test to replace so-called Wallace damages.

The Court concluded that Honda’s conduct in dismissing Keays did not establish an egregious display of bad faith to justify an award of damages for the conduct of dismissal. The Court further held that the employer’s conduct was not so malicious or outrageous to be deserving of punitive damages. The Court noted that such damages are only to be awarded in exceptional cases.

A more comprehensive summary of this important decision will be provided on our website shortly.

Honda Canada Inc. v Keays 2008 SCC 39