Throwing away good public money - for what?

The Lawyers Weekly
August 25, 2006
By Deana Driver
Regina

In Light Of Public Interest, Restrictive Covenant Cannot Stand Against Dumont

A Manitoba Metis leader who resigned from a ceremonial Metis National Council (MNC) governor position so he could seek election within the Metis nation does not have to pay damages for alleged breach of a restrictive covenant in his employment contract. Justice John Menzies of the Court of Queen's Bench of Manitoba ruled in Metis National Council v. Dumont (2006 MBQB 163) that the clause restricting W. Yvon Dumont from running for political office for a period of two years after leaving the Office of governor is unenforceable because it is contrary to the public interest, running against the political philosophy of the Metis people to choose their own leaders without MNC interference. "Even if the restriction was valid, the plaintiffs have failed to prove any damages flowing from the breach of the restriction by Dumont," he ruled.

Murray Trachtenberg of Posner & Trachtenberg in Winnipeg was counsel for the plaintiffs, the Metis National Council Secretariat Inc. and Clement Chartier on behalf of the Metis National Council (MNC). The defendant, Dumont was represemted by Anders Bruun and Jeff Niederhoffer of Campbell Marr in Winnipeg.

"This is significant in respect to the decision that a ban on employees seeking elected office within the Metis political structure is contrary to the public interest and not enforceable for that reason," Bruun told The Lawyers Weekly. Justice Menzies ruled in favour of Dumont on almost every point and "issued a judgment that I would say is almost appeal proof. There was no evidence of anything remotely resembling damages," added Bruun.

The MNC's board of governors created the ceremonial position of governor in 1999. Dumont was appointed to that role shortly after fulfilling his commitments as Manitoba's lieutenant governor. Terms of reference for the governorship were created in June 2001 after Dumont was nominated to run for MNC president. The terms included a "Politics" clause that set a prohibition from participating in Metis Nation politics for two years after ceasing to be the governor.

Justice Menzies ruled that the restrictive covenant was reasonable between the parties according to the reasoning in Elsley v. J. G. Collins Insurance, [1978] 2 S. C. R. 916. Although Dumont agreed to the terms in a letter he sent to the MNC and a continuation of employment is sufficient consideration to support a restrictive covenant in a contract [Peerless Laundry & Cleaners Ltd. v. Neal, (1953)], he concluded the terms were unenforceable because of the MNC's traditional response to the political will of the Metis people.

"The MNC had a long standing policy that the national governing body should not interfere in provincial Metis politics," he said. The court heard that three prominent provincial Metis leaders urged Dumont to contest the 2001 election and saw no difficulty in his running for office while holding the office of governor.

The board of governors decided not to take any action to prevent Dumont from running for president of the Manitoba Metis Federation in which he was unsuccessful, but wanted all remuneration paid to him since the acceptance of the terms of reference returned based on his apparent breach of contract.

"In light of the public interest to let the Metis people choose their own leader without interference from the MNC, the restrictive covenant cannot stand," concluded Justice Menzies. "I find the clause is unenforceable as being against the public interest."

He said that Dumont would have breached the "politics" clause of the agreement if it had been an enforceable clause. He refused to award damages to the plaintiffs, ruling there was no legal or factual evidence of unjust enrichment or any other damages.

Judge Menzies did not agree with the plaintiffs' claim that by running in the Manitoba Metis Federation elections, Dumont tainted the position of governor. "Every witness who was asked agreed that Dumont did an exemplary job as governor throughout his tenure."

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ANDERS BRUUN












JEFF NIEDERHOFFER



MURRAY NORMAN TRACHTENBERG

Tansi/Good Day Folks:

Couple quick points:

(1) The Lawyers Weekly is: in its 24th year of publication; has a weekly circulation of over 22,000 with more that 46,000 readers; and possesses the largest weekly distribution of any Canadian legal newspaper. Copies can be found in most Faculties of Law and lawyers' offices

(2) During the April 2006 trial, lead Defence Counsel Anders Bruun made the very interesting point if the MMF were so concerned with Mr. Dumont's elibibility to run in the 2001 election why didn't it simply launch a challenge before then Chief Electoral Officer Alvin Hamilton and save everyone a lot of time and money? In his written judgment Justice Menzies neglected to mention this fact

(3) The Plaintiffs had 30 days from the date Justice Menzies handed down his decision to challenge it by filing a Notice of Appeal followed by another 6 months to prepare written arguments. Upon checking the online Manitoba Justice Registry we could find no documentation indicating this was done.

Sincerely,
Clare L. Pieuk