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Law Assignment Case Solution & Answer

Law Assignment Case Study Analysis

The relevant facts

Referring to the case of Styles v Alberta Investment Management Corporation it begins with the termination of David Styles who was serving as an investment manager, without any reason. It is pertinent to note that while there wasn’t any distress regarding the payment in lieu of notice; he had entered into the LTIP (Long Term Incentive Plan) which provided that Mr. Style would be liable to get the payments of the bonus, after 4 years elapse. The LTIP has been designed to measure and evaluate the long term performance of Alberta Investment Management Corporation’s investments. Upon the termination of Mr. Styles, he had not received any bonus payments under LTIP. At trial, he successfully and competently argued that he was entitled to get the bonus payments, with trial judge evaluating that employer had discretion to withhold or award the amount of bonus. Holding the Bhasin’s principles, according to which the employer is obliged to exercise such discretion fairly& reasonably; it was ruled by trial judge that withholding the bonus amount was in contract by Bhasin’s principles.(CanLII, 2017).

The legal issues raised

Being employed for less than four years at the time of Style’s employment was terminated, demanded the value of his unpaid amounts under LTIP from AIMCo on termination, but AIMCo cited the LTIP’s terms and refused to make payments due to which Style brought an action in court in order to receive the unpaid amounts. The termination of Style was not legal on account of the fact that under the LTIP; the decision of refusing the bonus payments was not truly discretionary and he was terminated without any cause, which is not properly characterized as an exercise of discretion and the employer did not provide reasonable foundation for such termination. He was fired before completion of the period of four years, when the bonus became payable to the organization’s employee, without any cause to save the bonus amount. Since he was actively employed at the organization on the applicable vesting date, he was not entitled or eligible to get the payments of an LTIP grant. By failing to give reasons of termination and why Mr. Style was being denied his payments under LTIP; the employer of the organization has breached his duty to reasonably exercise his discretion, due to which the judge awarded LTIP payments to the employee, totaling to 444205 dollars.

The court’s decision

The decision made by Trial Judge was overturned by the Alberta Court of Appeal. By doing so; the so called common law duty of reasonable discretionary contractual power exercise was being rejected by court, calling it a radical law extension and beguiling heresy. The court came to the conclusion that the findings drawn by Trial Judge were not right as the non-payments of grants of LTIP was discretionary. Additionally, the decision of court was based on the reasons highlighted by judges, evaluating the Bhasin principles aligned with trial court’s decision of granting the benefits to Mr. Style…………………………………

 

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