Fransic Battiston v. Microsoft Canada Inc.

(Ontario) (Civil) (By Leave)


Contracts - Formation, Judgments and orders - Contracts — Contracts of adhesion — Formation — Judgments and orders — Unresolved issues — Employee notified of annual stock award by email — Employee did not read agreement, but clicked an electronic box to confirm that he had read, understood and accepted stock award agreement — Agreement provided that employee’s right to any unvested stock awards would terminate if employment terminated — Employee’s employment terminated without cause after notification of stock award but before stock award vested — Whether companies can rely on harsh and oppressive exclusion clauses in contracts of adhesion when those terms are not brought to the attention of the individual — Whether an individual’s indication that they have ‘read, understood, and accepted’ the contract plays any role in the company’s ability to enforce harsh and oppressive terms against that individual — Whether an issue not addressed by a trial judge must be addressed by the appellate court or remitted to the judge.


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Mr. Battiston had been employed by Microsoft Canada Inc. for 23 years when he was terminated without cause. Mr. Battiston sued for wrongful dismissal, claiming damages for, inter alia, the unvested stock awards. Before he was terminated, he had been granted stock awards. At that time, he was notified of the annual stock award by an email that provided that he could accept the stock award by “indicating that [he had] read, understood and accepted the stock award agreement and the accompanying Plan documents”. He clicked boxes to confirm receipt of the email and that he had read, understood and accepted the Stock Award Agreement. The Stock Award Agreement said that he would not receive the stock award if he wasn’t “actively providing services to the Company or a Subsidiary (regardless of the reason for such termination and whether or not later to be found invalid or in breach of employment laws, if any...)”, and that the right to vested stock awards would terminate on the date he last provided service to Microsoft “and will not be extended by any notice period”: clause 11(m). Microsoft said that these clauses meant that the stock awards would not vest. Mr. Battiston said that he had not read the Stock Award Agreement and did not know about the termination provisions. He believed that he would receive awarded stock that had not vested even if he was terminated.

The trial judge found, inter alia, that he was entitled to the stock awards that had not vested because the termination provisions of the Stock Award Agreements were unenforceable. As such, he found it unnecessary to address Mr. Battiston’s argument that the termination provisions are void under the Employment Standards Act, 2000, S.O. 2000, c. 41. Microsoft appealed only the finding concerning the vesting of the stock. The Court of Appeal allowed the appeal.