In an Aug. 8 decision in Mac’s Convenience Stores Inc. v. Basyal 2025 BCCA 284, Justices Lauri Ann Fenlon and Lisa Warren found for the majority that the chambers judge applied a colloquial understanding of agency rather than the precise legal test for agency relationships required at common law, so Mac’s could not be held vicariously liable.
Dissenting Justice Gail Dickson found, however, that Surrey, B.C.-based immigration consultant Overseas Immigration Services Inc. (Overseas) and related companies did have authority to bind Mac’s through the multistep hiring process under the federal Temporary Foreign Worker Program (TFWP), and apparent authority was communicated to workers by Mac’s, allowing Overseas to control hiring. Her dissenting opinion stated that the majority took too narrow a view of the required contractual binding authority.
About 450 of the workers, mostly from Nepal and the Philippines, are currently involved in a class action lawsuit against Overseas and Mac’s Convenience Stores, now owned by Laval, Que.-based Alimentation Couche-Tard. The lawsuit, which was certified in September 2017, alleges the workers paid $2,000 to $8,500 each in illegal fees — in some cases their life savings — to Overseas to obtain Mac’s convenience store jobs in Western Canada. Under the TFWP, employers — not workers — must pay recruitment costs for temporary foreign workers.
The 2015 civil claim led to two appeals to the B.C. Court of Appeal — Basyal v. Mac’s Convenience Stores Inc. 2018 BCCA 235 and Basyal v. Mac’s Convenience Stores Inc. 2019 BCCA 276 — and the class proceeding was ultimately certified in breach of fiduciary duty and unjust enrichment against Overseas, and against Mac’s in breach of contract, breach of the duty of honest performance, and vicarious liability for Overseas’ breach of fiduciary duty, based on a pleading that Overseas acted as Mac’s agent in the recruitment of the plaintiffs.
The parties asked the judge to decide three common issues in advance of the trial. In a November 2024 decision in Basyal v. Mac’s Convenience Stores Inc. 2024 BCSC 2007, Justice Sharon Matthews found that Overseas was acting as Mac’s agent in recruiting the workers, that Mac’s could be vicariously liable for any fiduciary breach by the consultant, and that the subclass members had no duty to mitigate their losses. Mac’s appealed.
Writing for the majority, Justice Fenlon emphasized that agency at common law has “a precise meaning, scope, and purpose” that differs from its colloquial usage. “The foundational element — the essence — of a true principal and agent relationship is the power of the agent to affect the legal position of the principal by entering into contracts with third parties that bind the principal,” she wrote.
The court noted that “in common parlance, ‘agency’ is often used loosely to refer to anyone acting on someone’s behalf. But at common law it has a precise meaning, scope, and purpose.”
Justice Fenlon found that the chambers judge had fallen into error by focusing on the scope of work performed by Overseas rather than whether it had authority to bind Mac’s contractually. “It was common ground that Mac’s reserved to itself the execution of the employment contracts,” she observed, noting that Overseas’s role was limited to pre-screening candidates, organizing job fairs and facilitating communications.
Justice Dickson dissented on the agency question. She argued that the majority took too narrow a view of the evidence and that “the judge found that Overseas was both an independent contractor for Mac’s and an agent authorized to act on Mac’s’ behalf in the multi-step hiring process involved in making binding employment contracts with temporary foreign workers.”
Justice Dickson emphasized that “the making of a legally binding contract involves a process that has several essential elements, including offer, acceptance, consideration, and an intention to create legal relations. While the agreement ultimately reached may be evidenced in writing, it is the process, not the document, that creates the legal obligation.”
On the second issue, the court unanimously found that a subclass of members in the class action who arrived in Canada to find no jobs had a duty to mitigate their losses, despite the practical difficulties they faced due to restrictive work permits.
The chambers judge had found that the employment contracts should be interpreted as not requiring a duty to mitigate because requiring mitigation would lead to “practical absurdity.” However, Justice Fenlon disagreed, noting that “the contract expressly addresses the potential for temporary foreign workers to change jobs” and included provisions for workers to be hired by new employers with positive labour market opinions.
Justice Fenlon acknowledged the workers’ vulnerable position but distinguished between the duty to mitigate and the capacity for mitigation: “Given the vulnerability of the employees and the practical challenges they faced in mitigating, my conclusion that the Subclass Members had a duty to mitigate under the contract may make little practical difference to the measure of damages at the end of the day. But it is important nonetheless to distinguish between the duty to mitigate and the capacity for mitigation.”
Counsel for the appellants, Mac’s Convenience Stores Inc., were Arif Chowdhury, Tom Posyniak, Kaleigh Milinazzo and Paige Mueller of Fasken Martineau DuMoulin LLP. Posyniak did not reply to an email seeking comment.
Counsel for the respondents — representative plaintiffs Prakash Basyal, Arthur Gortificaion Cajes, Edlyn Tesorero and Bishnu Khadka and defendants Overseas Immigration Services Inc., Overseas Career and Consulting Services Ltd. and Trident Immigration Services Ltd. — were Susanna Allevato Quail of Vancouver-based Allevato Quail & Associates and Kirby Smith of Vancouver-based Koskie Glavin Gordon.
“Many Canadian employers rely on third-party recruiters when they hire migrant workers through the Temporary Foreign Worker Program,” Allevato Quail said in an email to Law360 Canada. “There is significant potential for abuse and exploitation of vulnerable migrant workers in the structure of the program, including through unlawful recruitment practices.”
“Canadian employers must be held responsible for the actions of recruiters they hire,” she added. “It is illegal in Canada to charge a fee for a job, but many migrants find they have no real recourse when they have been charged fees, which typically wipe out their and their families’ life savings.”
If you have any information, story ideas or news tips for Law360 Canada, please contact John Schofield at john.schofield1@lexisnexis.ca or call 905-415-5815.