The Judgments Below
In the Supreme Court of Ontario, it was held that, while O'Malley and Zarzycki, as corporate officers, had fiduciary obligations to Canaero, such obligations did not apply in this case. As the trial judge (Grant J.) said,
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I do not interpret the decision above quoted as indicating that the mere fact of learning of the contract or even doing extensive work and preparation in attempts to secure the same for the plaintiff while they were still in their offices for it, of itself prevents them, after severing relations with their employer, from seeking to acquire it for themselves. It is not the coming upon or learning of the proposed contract while directors that establishes liability, but rather obtaining the same because of such fiduciary position and in the course of their duties as such. I would think that when directors or senior officers leave the employ of the company they must not use confidential information which they have acquired in such employment for the purpose of assisting them in getting such a contract for themselves. Such information so acquired by them would remain an asset of their principal even after they had left their employment. |
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The judgment was affirmed on appeal to the Ontario Court of Appeal, but it was held that O'Malley and Zarzycki did not have fiduciary obligations to Canaero. Instead, the relationship was simply that of employees and employer, involving no corresponding fiduciary obligations and, apart from valid contractual restriction, no limitation upon post-employment competition save as to appropriation of trade secrets and enticement of customers.
Read more about this topic: Canadian Aero Service Ltd. V. O'Malley
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