Queen v Cognos, a 1993 decision of the Supreme Court of Canada allowed a tort claim of negligent misrepresentation based on oral statements as to the terms of employment, notwithstanding that the contract had a provision which limited the severance sum.

While the words of the contract may indeed avoid a claim of this nature, for the reasons as expressed above, where this tort claim may be made, the severance clause is of no consequence.

It is clear that a claim for aggravated damages for unfair conduct and/or punitive damages where there is the required grade of malicious conduct will not be defeated by a limiting severance term. The same is true for tort claims arising from the employment relationship such as assault and battery, or the intentional infliction of mental distress, or defamation. ¹