Promotion and increased salary constituted fresh consideration to make contract valid

Ontario civil | Contracts

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Promotion and increased salary constituted fresh consideration to make contract valid

Defendant employed plaintiff for two years. Defendant asked if plaintiff would be interested in promotion with salary increase. Plaintiff said yes. Plaintiff later signed employment contract that contained termination clause. Plaintiff was given notice of immediate termination as result of corporate restructuring. Plaintiff was paid for two weeks in lieu of notice. Defendant asserted plaintiff’s employment was terminated with appropriate notice and package in accordance with employment contract. Plaintiff claimed damages for wrongful dismissal. Claim dismissed. Plaintiff was not entitled to any further notice or payment in lieu of notice. Contract and termination clause were enforceable and plaintiff was given notice in accordance with termination clause in employment contract. Verbal conversation was merely inquiry by manager as to whether plaintiff would be interested in new position created by defendant and not acceptance of employment contract. Plaintiff was informed at time of oral conversation that employment contract would be forthcoming with full details. By signing contract plaintiff accepted terms including promotion, salary increase, start date and termination clause. Plaintiff was sufficiently educated and had adequate time to review, consider and understand contract including termination clause. Plaintiff had ample time to ask defendant for any clarification needed and to seek appropriate professional advice. Promotion and increased salary constituted fresh consideration to make contract valid.
Gibbons v. BB Blanc Inc. (May. 24, 2016, Ont. S.C.J., J. Prattas D.J., Toronto SC-14-2070-00) 268 A.C.W.S. (3d) 549.

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