Executive Summary: Key Legal and Evidentiary Issues

• The court examined whether Borly Holdings Ltd. was a dependent contractor or an independent business.

• It considered if Country Lumber Ltd. owed reasonable notice before terminating Borly’s services.

• Key factors included economic dependence, exclusivity, control, and integration into the defendant’s operations.

• Admissibility of an expert report on financial loss was challenged but ultimately accepted.

• The court assessed mitigation efforts by Borly after contract termination to reduce potential damages.

• Damages and costs were awarded to the plaintiffs based on a 10-month notice period and financial evidence.

Facts and outcome of the case

Background and contractual relationship

Borly Holdings Ltd., owned and operated solely by Boris Ursic, provided trucking services to Country Lumber Ltd. for 14 years under an oral agreement. Mr. Ursic, through Borly, operated three trucks that were used exclusively to service Country Lumber's delivery needs. There was no written contract, but the relationship functioned with a high degree of regularity and integration into Country Lumber’s operations. Borly’s trucks carried the company’s decals, followed strict schedules, and the drivers attended the company’s meetings and followed its procedures.

In February 2024, Country Lumber informed Mr. Ursic that business was slowing and suggested he look for work elsewhere. On March 15, 2024, the company formally terminated the relationship without providing prior notice or severance, followed by a written confirmation the next day.

Legal issue and classification of the contractor relationship

The central issue was whether Borly was a dependent contractor entitled to reasonable notice upon termination. The plaintiffs argued that Borly was economically dependent and functionally integrated into the defendant’s business, warranting such classification. The defendant maintained that Borly operated as an independent contractor and thus had no entitlement to notice.

The court applied a range of legal factors to determine the nature of the relationship, including exclusivity, level of control, investment in tools, risk of profit or loss, integration into the business, longevity, and mutual reliance. While Borly owned its trucks and managed its internal staffing, the court found that Country Lumber exercised significant control over operations and that Borly was economically dependent on the defendant, with 100% of its revenue coming from the company over 14 years.

Assessment of reasonable notice and damages

Having concluded that Borly was a dependent contractor, the court turned to the question of reasonable notice. The plaintiffs sought 16 months of notice; the defendant argued for one month. The judge applied the Bardal factors—length of service, character of work, age, and availability of similar work—and concluded that a 10-month notice period was appropriate.

To assess damages, the court admitted an expert report calculating Borly’s projected net income using historical financial data and recent revenue figures. The court accepted this method but narrowed the revenue sample to the six months preceding termination to reflect economic downturns. Based on this analysis, the court determined that Borly's projected net income for the notice period was $96,594. After deducting $13,640.09 in mitigation earnings, the court awarded $82,953.91 in damages.

Conclusion and cost award

The court ruled in favor of the plaintiffs, holding that Borly was a dependent contractor and entitled to damages for lack of reasonable notice. The court also granted costs to the plaintiffs, with instructions that the parties could file written submissions if they could not agree on the cost amount.