Supreme Court of Canada Confirms Legal Obligations of Departing Employees

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Supreme Court of Canada Confirms Legal Obligations of Departing Employees

Author(s): Hooker, Dana, Overholt, Carman

Date: November 4 2008

The Supreme Court of Canada has reinstated the key elements of the decision of the Supreme Court of British Columbia in RBC Dominion Securities Inc v. Merrill Lynch Canada Inc. and in doing so, has clarified the law with respect to the legal obligations of departing employees in competitive industries.

This case arose after nearly all of the key staff members left the employment of RBC Dominion Securities Inc (RDS) for employment with Merrill Lynch Canada Inc. (Merrill Lynch) in Cranbrook, British Columbia. The branch manager played a central role in coordinating this mass departure; most of the employees were investment advisers and some were assistants. A few weeks before their departure this group of staff
moved RDS’s client records to Merrill Lynch’s offices. This was in addition to contacting RDS clients regarding the move both before and after the departure. All of this severely impaired the business of RDS in the area.

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