Sobolewski v Advanced Completions Technology Services Ltd, 2026 ABKB 10 is a recent Alberta Court of King’s Bench decision that illustrates how after-acquired cause can justify a dismissal for cause even when misconduct is discovered post-termination. In this case, a company president was fired after it emerged he had falsified a certification document in an attempt to secure a major contract for his struggling employer. The Court found that the dishonesty, although intended to help the company, irreparably destroyed the trust in the employment relationship, warranting summary dismissal. The Court’s judgment addresses key issues of just cause, employee credibility, and the importance of trust, and it carries broader implications for employment law regarding dishonest conduct by employees in positions of trust.
Facts of the Case
• Parties & Role: John Sobolewski (plaintiff) was the president and co-founder of Advanced Completions Technology Services Ltd. (“ACTS”), a small Alberta oil-and-gas tools company. He had been employed in this leadership role for almost seven years alongside two other director-shareholders.
• Falsified API Certificate: In early 2022, ACTS was pursuing a $1.7 million contract with a client (Kerui), the largest bid the company had ever undertaken, The bid required a valid American Petroleum Institute (API) certification. ACTS did not have its own current API certificate, so Sobolewski took an expired API certificate from a Chinese affiliate of an investor and altered it to appear valid. This forged certificate was included in ACTS’s bid submission. At the time, ACTS was in a financially precarious position, and Sobolewski later claimed he falsified the document to try to save the company.
• Termination: ACTS ultimately lost the bid for reasons unrelated to the certificate. In April 2022, shortly after the bid, the company terminated Sobolewski’s employment. He received the minimum statutory termination pay of 5 weeks but no common-law severance. The termination was initially done without a stated cause.
• Lawsuit and Defense: Sobolewski sued for wrongful dismissal, seeking common-law severance damages. In response, ACTS discovered the API certificate falsification after terminating him and raised this misconduct as an “after-acquired” just cause defense to avoid liability for severance. The company argued it would have fired him for cause had it known of the dishonesty earlier.
• Disputed Knowledge: A central factual dispute was whether ACTS’s other two directors were aware of or involved in the forgery. Sobolewski alleged that his fellow directors condoned or even participated in falsifying the API certificate (which, if true, could mean the company condoned the misconduct). The directors vehemently denied knowing about the forgery until after Sobolewski’s termination, positioning the case as a battle of credibility.
Key Legal Issues
1. Just Cause & After-Acquired Misconduct: Whether Sobolewski’s conduct in falsifying the API certificate constituted just cause for termination, especially given that the misconduct was discovered after he was fired. This included examining if the employer’s lack of knowledge (no condonation) at the time of termination allowed ACTS to rely on the doctrine of after-acquired cause to retroactively justify a dismissal for cause.
2. Wrongful Dismissal Claim: Whether Sobolewski was entitled to common-law severance (reasonable notice) for wrongful dismissal or if his misconduct disentitled him to any further pay. Resolution of this issue turned on the just cause question – a finding of just cause would defeat the wrongful dismissal claim.
Court’s Reasoning and Judgment
Just Cause for Dismissal (After-Acquired Cause): the Court’s analysis centered on the falsified certificate and the credibility of the witnesses. Because Sobolewski and the directors gave conflicting accounts about the forgery, the judge conducted a detailed credibility assessment. The court examined digital evidence (file timestamps, emails, and travel records) against Sobolewski’s testimony. This evidence showed that Sobolewski created the fake API certificate on his own while he was away on a field job, contrary to his claim that he had forged it in the presence of the other directors. For example, computer records proved the document was manipulated on March 18, 2022, at a time Sobolewski was alone in Estevan, Saskatchewan, and after that, one director emailed him an outdated certificate – undermining his story that the directors initiated or knew of the forgery. The Court found that Sobolewski’s story “evolved and changed” during his testimony to fit the evidence, whereas the directors’ version was consistent with the objective records. The Court concluded that Sobolewski had falsified the API certificate without the knowledge or approval of the other directors.
Having found that the misconduct was solely Sobolewski’s doing, the Court next considered whether it was serious enough to amount to just cause. The Court acknowledged Sobolewski’s positive history with the company (his seven-year tenure, lack of prior infractions, and even his willingness to take pay cuts during tough times) and the fact that he acted with a view to help the struggling business. However, the Court emphasized that deliberate dishonesty by a senior executive strikes at the heart of the employment relationship. In a small, closely-held company, trust and integrity among the principals are paramount. Sobolewski’s misconduct was not a mere technical lapse; it involved multiple deliberate steps to fabricate an official document (altering technical data to create a convincing fake) with the intent to deceive a client and even the company’s own investors/directors. The motive – to save the company (and indirectly himself as a shareholder) – did not excuse the act. As Justice Silver pointedly observed, “money overcame ethics” in Sobolewski’s decision-making. The court found that this breach of honesty and trust was fundamentally incompatible with Sobolewski’s role as president, especially since he was the “face” of the company in the bid and was expected to uphold its credibility. Given the gravity of the misconduct, the judge held that no lesser sanction (such as a warning or ethics training) could repair the “irreparable breakdown” of trust caused by Sobolewski’s actions. In sum, the falsification amounted to just cause for dismissal, and it was a proportionate response for ACTS to terminate Sobolewski immediately. Consequently, his wrongful dismissal claim was dismissed, with the Court holding that he was not entitled to any additional severance beyond the 5 weeks already paid.
Broader Implications in Employment Law
• After-Acquired Cause Affirmed: This decision reinforces the principle that an employer can rely on after-acquired cause to defend a wrongful dismissal claim if serious employee misconduct is discovered post-termination. Even though Sobolewski was initially terminated without cause, the later discovery of his fraud was deemed legitimate grounds for summary dismissal, relieving the employer of common-law severance obligations. Employers are thus reminded to investigate and document any misconduct that comes to light, as it may provide a full defense to a termination claim.
• Condonation and Knowledge: The case underscores that if an employer had been aware of or tacitly condoned an employee’s misconduct, it likely could not terminate for just cause on that basis later. Here, the outcome hinged on the finding that the other directors did not know of the forgery. Had the evidence shown they knew (or ought to have known) about the falsified document and let it happen, the Court intimated that just cause would not have been established. This highlights for employers the importance of acting promptly when misconduct is known – tolerating or overlooking bad behavior can forfeit the right to claim cause.
Importance of Honesty and Trust: Sobolewski is a clear example that dishonesty by a senior executive strikes at the core of the employment relationship. In positions of trust and leadership, even a one-time lapse in integrity (even if motivated by perceived “good intentions” for the company) can justify dismissal for cause. The ruling sends a message that no amount of good intentions or past good service will excuse a serious act of fraud or deception in the workplace. Especially in small or closely-held companies, trust among key personnel is paramount; once that trust is broken, an employer is entitled to sever the relationship immediately.
• Proportionality and Context: The decision illustrates how courts apply the principle of proportionality in just cause analysis – weighing factors like the employee’s record, length of service, and the context of the misconduct against the severity of the wrongdoing. While Canadian courts generally recognize that summary dismissal is reserved for very serious misconduct, Sobolewski demonstrates that forgery and deception are sufficiently egregious to warrant dismissal even for a long-term, high-ranking employee. It affirms that acts of fraud or fabrication of credentials are fundamentally incompatible with continued employment, given the high premium on trust and honesty in any employment relationship.
Lessons on Evidence and Credibility: The case highlights the role of concrete evidence in resolving factual disputes. Digital timestamps, emails, and objective records were crucial in disproving the employee’s story. For employers and employees alike, the takeaway is that credibility is key in court – when an employee’s testimony “evolves” or conflicts with documented evidence, courts will side with the evidence. Maintaining clear records (and not altering them) can make or break a case.
*Always seek legal advice. The above is for information purposes only.
Stephen Dugandzic received his Juris Doctor degree from the University of Alberta in 2013 and is Calgary-based. He previously practised with Bennett Jones LLP and Taylor Janis LLP before founding YYC Employment Law Group in 2018 and Evolution Legal in 2026.