In Dell v Brookfield Residential (Alberta) LP, 2025 ABKB 403, a wrongful dismissal action failed for an employee found to have breached conflict of interest and anti-fraud policies. The Court found the employer had just cause for dismissal.
However, the plaintiff was awarded a significant amount for commissions on house sales that closed after his termination of employment, along with significant contractual vacation pay.
This case is important because there is a significant amount of evidence weighing and other employment law analysis.
Facts
The following were some of the pertinent facts summarized by the ABKB:
- The Plaintiff Bryan Dell was employed by Brookfield Residential (Alberta) LP for over 8 years in the position of Community Manager, responsible for Riverstone Estates in Calgary
- Dell reported to the Sales Manager and had 2 employees reporting to him
- Dell had a written employment agreement and two amendments over the last few years of his employment
- Brookfield had a Code of Conduct and Ethics and an Anti-Bribery Policy, which all employees were trained on
- Dell was approached by California Closets respecting their products and some elements of an incentive plan related to their products. The parties disputed what he was told about incentive plans, whether Mr. Dell was offered one, and whether he accepted it
- A VP at Brookfield attended an industry event and heard things that made him believe California Closets was offering incentives to Brookfield staff to encourage them to recommend California Closets to Brookfield’s customers
- Brookfield initiated an internal investigation to determine if this was happening. Brookfield concluded that Mr. Dell had violated the Code of Conduct and Anti Bribery Policy by participating in an unsanctioned incentive program
- Brookfield terminated Mr. Dell’s employment without any severance, alleging just cause
- Brookfield also did not pay Mr. Dell’s final commissions
- Dell sued for severance and unpaid commissions
- Dell’s evidence at trial was that he did not participate in an incentive program. However the following was the surrounding evidence:
- Dell acknowledged that he had requested change orders which removed closets from the Brookfield scope of work on behalf of some customers. Some of the work orders showed that California Closets became the supplier
- Dell acknowledged that he spoke about incentive programs with California Closets, but said that the rep from California Closets was just seeking his feedback about a condominium program which had nothing to do with Mr. Dell (he sold estate houses, not condos). The evidence of the California Closets rep lined up with this
- The owner of California Closets testified for Brookfield. He stated that there had been an incentive plan for salespersons selling houses at the relevant time, and he had allowed his rep to offer incentives to salesperson’s with home builders. A plan relating to condo incentives had been in development but not yet implemented
- There was a text message from the owner of California Closets to Brookfield in evidence which confirmed that Mr. Dell had been offered an incentive plan
- Two other Brookfield salespersons who sold houses testified that they had been approached by California Closets about the incentive plan related to houses
- Dell did not receive anything from California Closets, but the incentives would have only come post-installation (i.e. if there was an incentive arrangement), which had not happened prior to dismissal
- The Court determined that it was not persuaded by the story of Mr. Dell, because Mr. Dell claimed it came up organically, but there were two other Brookfield house sales reps were approached about incentive programs around the same time. The Court discounted the California Closet rep’s recollection of events from 7 years prior to the trial, and determined that Mr. Dell had been offered the incentive pertaining to houses
- The Court also determined that Mr. Dell acted on the incentive offer, because there were two change order requests shortly after the discussion and one of the home buyers testified that Mr. Dell had suggested going with California Closets
- Two Brookfield house deals Mr. Dell had been working on closed a few months after he was dismissed, and the final 25% of the commissions for those deals were paid out to the sales rep responsible for those houses at that time. Dell did not receive those commissions
Analysis / Conclusion
The Court had found as facts that Mr. Dell had received the incentive offer from California Closets while employed at Brookfield and had acted on it.
The Court moved on to consider whether Mr. Dell’s actions warranted just cause for dismissal of his employment. The Court framed the question as being about whether Mr. Dell violated the Conflict of Interest policy and the Anti-Bribery Policy.
Brookfield’s Conflict of Interest Policy and Anti-Bribery Policy were clear that employees had to avoid the appearance of conflict of interest and should report potential conflicts of interest. Additionally, it was clear that employees were not to solicit or receive payments, gifts or other benefits from vendors, suppliers and third parties, and it was stated to be zero tolerance.
The Court noted that Mr. Dell had committed a serious violation of the Conflict of Interest policy, and noted as follows:
[53] Irrespective of whether Mr. Dell actually received money or gifts from California Closets, the circumstances which were allowed by Mr. Dell to be created gave rise to at least the appearance of a conflict of interest. In the circumstances, the Code of Conduct required Mr. Dell to take some steps after having been visited repeatedly by [California Closets]. Mr. Dell did not take steps to address those concerns.
The Court went on to conclude that dismissal with cause was a proportionate response to Mr. Dell’s actions. The reasoning was as follows:
[63] […] Mr. Dell failed to comply with the Code of Conduct and the Anti-Bribery Policy by reporting events which might appear to be bribery or otherwise violate Brookfield’s policies. Further, despite being confronted with Brookfield’s concerns about California Closets during its investigation, Mr. Dell continued to deny any wrongdoing and continued to fail to report or otherwise address a potential conflict or appearance of a conflict. Brookfield was entitled to conclude that based on Mr. Dell’s conduct, the trust relationship between Brookfield and Mr. Dell was broken and beyond repair.
The Court then turned to the question of the 25% commissions on the two houses that closed after Mr. Dell was terminated. Brookfield’s position was that these were not owed to Mr. Dell because the commission plan stated that first two commissions (totaling 75%) were advances, and the 25% closing commissions was not payable until closing.
Mr. Dell argued that the timing of commission payments was irrelevant because some terms in the plan indicated they were earned regardless of when paid. The Court agreed with Mr. Dell on this. The commission plan was clear that the closing commission was not paid until closing, but were not clear that he had not already earned the commission or even had to be employed when closing occurred – so long as closing occurred he was entitled to the closing commission.
Mr. Dell was awarded $80,687.29 in unpaid commissions.
Mr. Dell also sued for 8% contractual vacation pay on his final commissions. Brookfield took the position that vacation pay was already included in the commissions, but the Court disagreed, citing authority that vacation pay and commission should not be integrated together. The Court awarded the 8% contractual vacation pay.
My Take
This case is very interesting to me. It is not at all surprising to me it made it all the way to trial, given how close the positions potentially were.
On the wrongful dismissal issue, my impression was that the case turned on the question of whether Mr. Dell participated in the incentive program. This was a disputed fact with material evidence in favor of both sides. This would have made it hard for either party to back down on going to trial.
Once the Court found he had participated in the incentive program, it seemed to follow that it had at least the appearance of a conflict and that he had denied participation. Just cause analysis often goes this way – if a judge finds misconduct on contested facts (like here), the next thing the judge usually finds is that the employee was not candid and took no responsibility. Just cause is a short step from those findings.
The commissions analysis was interesting to me because commissions after dismissal can be a challenging issue.
The vacation pay analysis was quite interesting to me and I think that could have gone either way.
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