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When Everyone is “Successful” But No One Wins: The Costly Lesson in Salina v. Investors Group
Litigation is often thought of in much the same way as sport: expected to produce a winner and a loser (we’re ignoring soccer for these purposes – as one of the above authors did throughout this summer).
Sometimes, however, after years of litigation, extensive document production, expert evidence, and weeks of trial, the result resembles a scoreless draw, with neither side getting what it wanted despite the significant time and expense invested along the way. At best, one or both parties emerge with a Pyrrhic victory..
The recent decision of Salina v. Investors Group Financial Services Inc., 2026 BCSC 1168, is a perfect illustration. The Plaintiff, a former investment consultant, established that he was a dependent contractor, that the termination provision in his contract was unenforceable, and that his alleged misconduct known at the time of termination did not amount to just cause. However, his wrongful dismissal claim was ultimately dismissed because his employer established after-acquired cause.
Meanwhile, the employer established that the consultant had breached enforceable non-solicitation and confidentiality obligations. However, it recovered nothing because it failed to prove that the contractual breaches caused its losses. Its counterclaim was also dismissed.
The Case: Salina v. Investors Group Financial Services Inc.
Mr. Salina worked with Investors Group for approximately 27 years. By the time his relationship with the company ended, he had built a substantial book of business and approximately $92.5 million in assets under management.
In May 2018, Investors Group terminated Mr. Salina for cause, describing him as “unsupervisable”. Mr. Salina disagreed and commenced a wrongful dismissal action, while Investors Group counterclaimed for breaches of his contractual confidentiality and non-solicitation obligations.
The resulting trial lasted more than three weeks. More than 40 binders, most of them of the three-inch variety, were entered as exhibits. The parties delivered approximately 250 pages of written submissions and cited more than 150 authorities.
The whistle is blown and the match begins!
Employee, Independent Contractor, or Something in Between?
The first issue was whether Mr. Salina was an employee, an independent contractor, or a dependent contractor (a hybrid category which can be entitled to common law termination notice, although not other employment protections).
The Court examined the overall relationship between the parties. Mr. Salina earned commissions rather than a salary, paid many of his own expenses, had an opportunity to increase his profits, claimed business expenses as a self-employed contractor, and had expressly agreed that he was not an employee. However, Investors Group exercised considerable control over his work: Mr. Salina could sell only Investors Group products, his trades were subject to review, his marketing required approval, and his clients were contractually considered clients of Investors Group.
Based on these facts, the Court found that the relationship fell between employment and independent contracting: Mr. Salina was a dependent contractor. As a result, absent just cause or an enforceable contractual provision to the contrary, he was entitled to common law termination notice or severance in lieu.
A promising start for Team Salina.
“No Notice” Is Not a Notice Period
The agreement permitted either party to terminate the relationship “with or without cause and with or without notice or any compensation in lieu of notice.” Investors Group argued that, because the Employment Standards Act did not apply to Mr. Salina, this provision meant it could terminate him without cause and with zero notice.
The Court rejected that argument, concluding that “zero notice” is incompatible with the requirement for “some other period of notice.” Even though no statutory minimum applied, the contract still needed to specify an alternative period, which could have been as little as one day. The provision therefore failed to displace the common-law presumption and was unenforceable.
More scoring chances for the Plaintiff.
No Cause at Termination But After-Acquired Cause Determines the Result
The Court then reviewed the reasons Investors Group relied upon when it terminated Mr. Salina. It found that he engaged in misconduct but characterized the conduct as of moderate severity that did not justify terminating a long-serving, high-performing consultant without notice. Investors Group therefore did not have just cause based on the information available to it on May 23, 2018.
At this point, the Plaintiff looked poised to score
However, after the termination, Investors Group discovered that Mr. Salina had obtained and retained 24 pre-signed client forms. Some had been obtained while he was under close supervision, during which he had signed attestations confirming that he did not possess such forms.
The Court found this to be severe misconduct involving deceit and dishonesty, incompatible with the trust required of an investment advisor. Although Investors Group did not know about the forms when it terminated him, the misconduct existed at the time and the employer was entitled to rely on it after the fact. It therefore established “after-acquired cause”, and Mr. Salina’s wrongful dismissal claim was dismissed.
After all that build-up, the Plaintiff fails to score, and the Defendant goes on the counter-attack.
Investors Group Proved Breaches But Not Loss
Investors Group then sought to prove that Mr. Salina breached two clauses of his consultant agreement.
The Court found that Mr. Salina was prohibited from soliciting business from certain Investors Group clients and further found that meetings Mr. Salina held with former clients went beyond maintaining contact and amounted to solicitation.
The Court also found that Mr. Salina breached his confidentiality obligations by retaining hundreds of documents containing client and financial information and failing to return them after termination.
A winning goal for the Defendant appears inevitable.
Investors Group claimed that approximately $35 million in assets under management had followed former clients to Mr. Salina’s new firm, resulting in approximately $1.3 million in lost revenue.
But proving a breach is not the same as proving damages. Investors Group needed to establish that the breaches caused the lost revenue (i.e., that the breaches caused the clients to leave). It presented evidence about clients who transferred their accounts and the resulting losses, but no admissible evidence from the former clients explaining why they moved. The Court noted that the clients may have left because of Mr. Salina’s solicitation, but they may also have left for unrelated reasons.
Without sufficient evidence connecting the breaches to the lost business, Investors Group failed to prove causation. Its counterclaim was dismissed.
And that’s the final whistle. The final score (like too many soccer matches): 0–0.
What Employers and Workers Should Know
- Correct Classification Matters
Calling someone an independent contractor does not make them one. Courts look at the substance of the relationship, including control, integration, economic dependence, risk, opportunity for profit, and the parties’ conduct. A worker can operate with significant independence and still qualify as an employee or a dependent contractor, both of which are entitled to termination notice or pay in lieu.
- “No Notice” is Not an Effective Termination Clause
A termination clause allowing termination without cause and without any notice may not displace the common-law presumption of reasonable notice. While parties are free to agree on a shorter notice period than would be available at common law (or even less than ESA minimum if the worker is legally a dependent contractor), the agreement must clearly specify what that period is – even if it’s just one day.
- After-Acquired Cause Can Defeat an Otherwise Valid Notice Claim
As we have previously noted, an employer may rely on misconduct discovered after termination if the misconduct existed at the time of dismissal and was sufficiently serious to justify termination without notice. But the standard remains high, and the alleged conduct must be assessed contextually and proportionately.
- A Breach of Contractual Obligations Does Not Automatically Prove Damages
An employer can successfully establish that a former worker breached post-employment/post-engagement obligations but still recover nothing. Compensatory damages require proof that the breach actually caused the claimed loss. Evidence establishing the amount of lost business cannot replace evidence demonstrating why the business was lost.
The Bottom Line: Litigation Does Not Guarantee Anybody a Remedy
This decision is a harsh reminder that being legally right about part of a dispute is not the same as obtaining a successful result.
In this case, both parties proved a lot of their case successfully. And yet, after a lengthy and expensive trial, they both walked away with nothing (except a healthy legal bill, presumably).
That is why negotiation and early resolution remain the best approach in most cases. Courts decide whether legal elements have been proven; they do not guarantee either party the practical remedy they expected when litigation began.
One of the risks of litigation is tunnel vision: parties often focus on the points they are confident they can prove and the outcomes they believe they are entitled to, while discounting the strengths of the other side’s case and the risks in their own. Effective negotiation requires the opposite approach. It requires parties to realistically assess both the opportunities and vulnerabilities in their position and account for the uncertainty inherent in litigation. A negotiated resolution can account for cost, legal fees, risk, ongoing business interests, and the uncertainty inherent in proving cause, enforceability, causation, and damages.
Sometimes litigation produces a clear winner. But more often than one would expect, both parties exhaust themselves and their bank accounts for the legal equivalent of a scoreless draw.
If your organization faces potential litigation with a former employee or contractor, Boughton Law’s Labour & Employment Group can help you avoid any pitfalls. Please contact Matthew E. McCarthy for tailored advice.
