John Run of Kinkville, Nova Scotia, has been a taxi driver for all his working life.

John Run of Kinkville, Nova Scotia, has been a taxi driver for all his working life. In 2001, after purchasing his own taxi, he is approached by Fred Runaround, who owns a taxi business called Kinkville Taxi Service (KTS). Fred tells John that he wants him to join his business and operate a taxi under the following terms:

  • John must exclusively operate his taxi under the KTS banner and use the business dispatcher system and communications service;
  • John will be entitled to 70% of his gross taxi fares and 30% of gross fares would go to KTS;
  • Johnwillworkhisownhoursexceptthatheisrequiredtoworkandbeoncallaminimumof50
  • hours per week for a minimum of 6 days of the week;
  • The parties will enter into a one-year renewable contract;
  • KTS will be responsible for all marketing, advertising, promotions etc.
  • John agrees to the above terms, and John and Fred sign a written contract on November 1, 2001, clause 6 of which states:
  • “This contract is for a renewable one-year term and can be terminated by any party for any reason by providing the other party with 3 weeks of notice of termination.”
  • Subsequently over the period of 15 years John and Fred renew their contract 15 times. John does not have to reapply every year but in November of each year they sign a new contract that contains identical terms to the original, which most recently they sign in November of 2017. In January 2018, John is 56 years of age and still loves his work. However, KTS is financially suffering because of the economic downturn.
  • In fact, because of the local economic problems, John starts working for other local taxi companies in 2016 on a part time basis, and in fact in 2017 slightly more than 40% of his income his earned from these other operators. [problem continues on next page]

On January 23, 2018 Fred gives John the following letter:

“Because of economic difficulties I have to terminate our contract. Pursuant to clause 6 of our contract I hereby provide you with 3 weeks of notice of termination. Thanks for your years of service. Regards, Fred”

John is furious and comes to you, the best labour lawyer in Kings County, and wants to know his legal rights.

Please provide John with your opinion and be sure to discuss all relevant legal issues and justify your answer.

Please note that after his termination John continues to work for the other operators, and starts part time work at the local Dollar Store in order to help pay his bills. 

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