In a further testament to the enforceability of confidentiality provisions in settlements, the Ontario Superior Court of Justice unanimously upheld an arbitrator’s decision that former Globe and Mail columnist Jan Wong must repay all settlement dollars to her ex-employer after a breach of confidentiality.
We reported in our March 2014 newsletter on the decision in Globe and Mail v. Jan Wong [2013 OLAA No. 273]. In that case, Jan Wong had reached a settlement in her grievance claim against The Globe and Mail with respect to the termination of her employment.
The settlement agreement provided that:
“should the Grievor breach the obligations set out in paragraph 5 and 6 above, (the arbitrator) shall remain seized to determine if there is a breach and, if she so finds, the grievor will have an obligation to pay back to the Employer all payments paid to the Grievor under paragraph 3.”
Jan Wong then wrote a book called Out of the Blue about her experience with depression and the termination of her employment at The Globe and Mail. In her book, she made the following references to the settlement that the union had negotiated on her behalf:
- “I can't disclose the amount of money I received”
- “I’d just been paid a pile of money to go away"’
- “Two weeks later a big fat check (sic) landed in my account"
- “Even with a vastly swollen bank account … “
As a result of those statements, the arbitrator ruled that there had been a breach of confidentiality, and Ms. Wong was ordered to repay to The Globe and Mail all of the settlement money that she had received.
Jan Wong then applied to the Superior Court of Justice in Ontario for a judicial review of the arbitrator’s decision. In the application, the union that had represented her, the Communications, Energy and Paperworkers Union, was also named as a respondent as Ms. Wong alleged that the union had not properly represented her at the arbitration.
Court Upholds Enforceability of Confidentiality Clause in Settlement Agreement
The court decided this matter in Jan Wong v. Globe and Mail Inc., 2014 ONSC 6372. With respect to the union representation issue, the court decided that the union’s representation of Ms. Wong was proper and that “counsel for the Union did his best to protect the applicant’s interests, including in situations where it appears that the applicant was not of a mind to protect her own interests.” The application against the union was dismissed.
On the enforcement of the confidentiality clause, Jan Wong argued in court that the requirement to repay the entire settlement amount was unfair. The court, however, agreed with the arbitrator that “confidentiality was the one thing that The Globe and Mail wanted” from the settlement, stating that, “The Globe and Mail was to pay the applicant a large lump sum and the applicant was to stay quiet about the payment. It was an entirely reasonable enforcement mechanism, if the applicant failed to meet her main obligation under the MOA [Memorandum of Agreement] – confidentiality – that The Globe and Mail would be relieved of its main obligation under the MOA – the second lump sum payment.”
The court upheld the decision of the arbitrator that Jan Wong was required to repay the $209,912 settlement to The Globe and Mail. In addition, the court ordered Ms. Wong to pay $30,000 in costs to the respondents – $15,000 to the union and $15,000 to The Globe and Mail.
This decision is important because it demonstrates a very effective method for enforcing confidentiality clauses in settlement agreements by requiring repayment of the settlement if confidentiality is breached.