2019 QCCQ 4731, 2019 QCCQ 4731

Smith c. Gadbois 2019 QCCQ 4731 COURT OF QUEBEC Small Claims Division CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL Civil Division No: 500-32-701118-178 DATE: July 22, 2019 ______________________________________________________________________ BEFORE THE HONOURABLE ENRICO FORLINI, J.C.Q. ______________________________________________________________________ MICHAEL SMITH And PATRICIA LEMOINE Plaintiffs v.

JACQUES-YVES GADBOIS And SANDRA DE MONTINY Defendants ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] Michael Smith and Patricia Lemoine claim $8,589.92 in damages from Sandra De Montigny and Jacques-Yves Gadbois on the grounds that the Defendants failed to respect their obligations under a contract of sale of their property. [ 2 ] Specifically, Plaintiffs argue that the Defendants 1) failed to deliver numerous items that were included in the sale of the property, including three refrigerators, a kitchen table, shelving, and a home entertainment system; 2) delivered the property in a damaged state; and 3) failed to respect the warranty of quality because the property was afflicted with latent defects, including defective electrical wiring and a collapsed concrete window sill. [ 3 ] The Defendants deny all liability.

They argue that while 2 refrigerators were included with the sale, the Plaintiffs changed their minds and decided not to keep them. They subsequently had a change of heart and decided they wanted to keep the refrigerators, but by that time, the Defendants had already removed them from the property. When the Defendants offered to return 1 of the refrigerators, they were deprived of the opportunity to do so because the Plaintiffs had already purchased new ones.

They assert that the other items were never included with the sale, that the property was delivered in the same state as it was when it was inspected, and that it was not afflicted with latent defects. They add that the property sold is a hundred year old home and the problems the Plaintiffs complain of are not latent defects but rather result from normal wear and tear considering the age of the building. [ 4 ] Defendants crossclaim against the Plaintiffs and they each claim $1,500 from the Plaintiffs on the grounds that the claim is abusive within the meaning of

article 51 of the Code of Civil Procedure ( C.C.P. ). They also claim an additional $455 each on the grounds that the Plaintiffs illegally instructed the notary to withhold the proceeds of the sale for one week, which delay caused them to lose interest on these funds. Issues [ 5 ] The Plaintiffs’ claim raises the following issues:

a) Have Plaintiffs proven that the Defendants failed to deliver items that were included with the sale of the property?

b) Did the Defendants deliver the property in a damaged condition?

c) Was the property afflicted with latent defects?

d) If the Defendants breached their obligations under the contract of sale, what damages were caused to the Plaintiffs? [ 6 ] The Defendants’ cross-claim raises the following issues:

e) Did Plaintiffs commit a fault by instructing the notary to withhold the disbursement of the proceeds of sale, and if so, what damages were caused to the Defendants?

f) Is Plaintiffs’ claim abusive within the meaning of

article 51 C.C.P. and if so, what damages were caused to the Defendants?

Context [ 7 ] By notarized deed of sale dated October 14, 2016, the Defendants sell to the Plaintiffs for $645,000 a six bedroom cottage located in Montréal West built in 1910 (“ Property ”). [1] The sale is made with legal warranty and provides that the Plaintiffs/purchasers shall have possession of the Property on the same day. [ 8 ] The Defendants/sellers are represented throughout the sale process by their real estate brokers Catherine Gardner and Carlos Lefebvre.

The Plaintiffs/purchasers are represented by the real estate broker Alexandre Sebe. [ 9 ] The sale of the Property was preceded by the following events. [ 10 ] In mid-July 2016, the Property is put on the market for sale. [ 11 ] On July 25, 2016, the Plaintiffs visit the Property. [2] [ 12 ] On July 26, 2016, Plaintiffs sign an Offer to Purchase the Property which is counter-signed by the Defendants on July 27. [3] The Plaintiffs offer to purchase the Property for $631,000 without legal warranty, or alternatively, offer to pay $645,000 but with legal warranty. [ 13 ] On July 27, 2016 the Defendants/sellers submit a counterproposal to the Plaintiffs’ promise to purchase.

They offer to sell for $645,000, with legal warranty of quality, and list a number of items that are included with the sale. [4] [ 14 ] Later on that same day, the Plaintiffs/purchasers accept the Defendants’ counterproposal. [5] [ 15 ] On August 1, 2016, the Plaintiffs’ pre-purchase home inspector inspects the Property.

His pre-purchase building inspection report is remitted to the Plaintiffs shortly thereafter. [6] [ 16 ] The sale of the Property closes on October 14, 2016 when the parties sign the deed of sale before the notary Angeles Lopez Gutierrez (« Mtre Gutierrez »). [ 17 ] Later that day, Plaintiffs take possession of the Property.

They notably notice that there are no refrigerators in the kitchen or in the basement. [ 18 ] The parties communicate by email and through their real estate brokers in the ensuing days, but the complaints raised by the Plaintiffs is not resolved. [ 19 ] The proceeds of sale are disbursed to the Defendants by Mtre Gutierrez, the notary, on October 21, 2016. Analysis and Decision

a) Have Plaintiffs proven that the Defendants failed to deliver items that were included with the sale of the property? [ 20 ] Plaintiffs assert that the Defendants failed to deliver a number of items that were included with the sale of the property. These items are either specifically listed as included with the sale in the contractual documents or are immovables by attachment and as such accessories included with the sold Property.

These include three refrigerators, a wall mounted breakfast table, wall mounted shelving in the basement, and a home entertainment system located in the basement. [ 21 ] The Court will address each of the items separately below. The refrigerators [ 22 ] Plaintiffs claim that the sale included a refrigerator in the kitchen and 2 refrigerators in the basement. [ 23 ] The Defendants admit that the sale included two refrigerators (one in the kitchen and a second one in the basement), but not three.

They assert however that they were informed subsequent to the Plaintiffs’ acceptance of their counter proposal to the promise to purchase that the Plaintiffs no longer wished to keep the two refrigerators and thus they removed them from the premises when they moves out.

When they learned that the Plaintiffs still insisted on keeping the refrigerators, they offered to return the kitchen refrigerator but by then, it was too late as the Plaintiffs had purchased a new one. [ 24 ] The notarized contract of sale stipulates that « the present sale includes the movables effects listed in the promise to Purchaser, duly signed and accepted by the Parties ». ( sic ) [7] [ 25 ] The counter proposal to the promise to purchase which Plaintiffs accepted on July 27, 2016 includes the following clause in

section P2.3.4: OTHER AMENDMENTS …

11.5 Inclusions: Gaz, stove, dishwasher, fridges in kitchen and basement, blinds, lighting, fixtures… - all as is and without guaranty of quality. [8] [ 26 ] While Plaintiffs claim that the sale included three refrigerators, the evidence establishes that there were only 2 refrigerators in the Property: one in the kitchen and one in the basement. The other item in the basement was a freezer. The Defendants’ testimony is corroborated by the testimony of their real estate agent, Mrs. Gardener. Moreover, in Mr.

Smith’s email sent to the Defendants on October 14, 2016 at 18:33, he refers to two fridges as inclusions and does not refer to the freezer at all. [9] There is no mention whatsoever of a freezer in the counterproposal to a promise to purchase and Mrs. Gardener, the real estate agent, affirms that the freezer was never included in the sale.

The basement freezer does not come within the scope of the language of clause P2.3.4 and was never included in the sale of the Property. [ 27 ] As for the two refrigerators (kitchen and basement) that were included in the sale, the Defendants removed them from the Property when they moved out because they had been informed that the Plaintiffs no longer wanted them. [ 28 ] Indeed, during the August 1 pre-purchase inspection of the Property attended by Mrs. Gardener and the co-plaintiff, Mrs. Lemoine, the latter told Mrs. Gardener that she no longer wanted the two refrigerators. [ 29 ] Mrs.

Lemoine did not testify at the trial such that Mrs. Gardener’s testimony in this regard is unrefuted. [ 30 ] Considering this information, the Defendants acted reasonably when they removed the two refrigerators from the Property when they moved out. The basement refrigerator was 25 years old and picked up by trash collectors. [ 31 ] At 18:33 on October 14, 2016, Mr. Smith wrote to the Defendants to complain about the missing refrigerators. [10] Approximately one hour later on the same date, Mr. Gadbois wrote to Mr.

Smith to explain that the refrigerators had been removed because the Defendants had been told that the Plaintiffs were no longer interested in them. [11] Mr. Smith instructs the notary Me Gutierrez to “hold the money until we can resolve these issues”. [ 32 ] On October 18, 2016, Mr. Carlos Lefebvre, the Defendants’ real estate agent, informed the Plaintiffs’ real estate agent, Mr. Alexandre Sebe, by email that the Defendants were willing to return the kitchen refrigerator and to compensate Plaintiffs $100 for the basement refrigerator. [12] [ 33 ] On October 21, Mr.

Lefebvre had not heard back from the Plaintiff’s real estate agent concerning this offer. [ 34 ] On October 22, Mr. Lefebvre followed up with Mr. Sebe concerning the October 18 offer and learned from Mr.

Sebe that the Plaintiffs had already purchased a new refrigerator for the kitchen and refused the Defendants’ offer to return the refrigerator. [13] Indeed, Plaintiffs’ invoice for the purchase of a kitchen refrigerator indicates that it was purchased on the evening of October 20. [14] [ 35 ] The Civil Code of Québec ( C.C.Q. ) obliges a creditor to send his debtor a notice of demand prior to exercising his legal rights. [15] [ 36 ] The demand letter must be in writing, and must afford the debtor sufficient time for performance of the obligation which the creditor alleges he has breached. [16] [ 37 ] The purpose of the obligation to put a creditor on demand is to allow the latter to remedy the default within a reasonable amount of time.

Where the delay afforded to the debtor to remedy the breach is unreasonably short or if the creditor acts before the expiry of a reasonable delay, he loses the right to receive compensation. [ 38 ] This is what happened in the present case. Plaintiffs are not entitled to any damages for the kitchen refrigerator because they acted precipitously and they failed to allow the Defendants to return the refrigerator within a reasonable timeframe.

In ordering a new refrigerator on October 20, only 6 days after their demand, while the Defendants had offered to return the item on October 18, the Plaintiffs lost their right to claim damages for the kitchen refrigerator. [ 39 ] As for the basement refrigerator, the unrefuted testimony of Mrs. Garderner establishes that the Plaintiffs waived their rights over this item on August 1. Accordingly, their claim for this item is unfounded. Kitchen table [ 40 ] Plaintiffs argue that this item is included in the sale of the Property because it was fixed and bolted into the wall of the kitchen. [ 41 ] Mr.

Gadbois counters that this was a table purchased in 2004 from IKEA for $100. It is a free standing small breakfast table. He adds that it was fastened to the wall simply to improve its stability and for the protection of the young children of the family. [ 42 ] According to the photographic evidence, the kitchen breakfast table was a self- standing elevated breakfast table which was temporarily attached to the kitchen wall. [17] Small holes were left in the kitchen wall when the table was removed. [18] [ 43 ] According to

article 1718 C.C.Q., “the seller is bound to deliver the property in the condition it is at the time of the sale, with all its accessories .” (Underlining added) [ 44 ] The term “accessories” means “les choses qui complètent la maison ou permettent son usage”. [19] [ 45 ] According to

article 899 C.C.Q., property is either movable property or immovable property. Things which can be moved are movables (art. 905 C.C.Q.) . Land, and any constructions and works of a permanent nature located thereon and anything forming an integral part thereof, are immovable (art. 900 C.C.Q.) .

[ 46 ] The term “accessories” in art. 1718 C.C.Q. must also be interpreted in light of these rules, since an item of property which may at first qualify as movable property, may be deemed immovable property. If so, it will thereby be considered an accessory for the purposes of

article 1718 C.C.Q., and thus the seller must deliver this item with the home when he sells it. [ 47 ]

Article 903 C .C.Q. provides that movable things which are permanently and physically attached or joined to an immovable without losing their individuality and without being incorporated with the immovable are immovables for as long as they remain there and ensure the utility of the immovable.

This type of property is referred to as an immovable by attachment. [ 48 ] Based on this rule, movable things that are permanently attached and joined to an immovable, such as kitchen cabinets, wall to wall carpets, above ground swimming pools, heat pumps, electric base boards, built-in dishwashers, and wood burning fireplaces are thus considered part of the immovable and qualify as accessories which must be delivered with the sold residence. [20] The permanent nature of the attachment is an essential criteria for a movable to become an immovable by attachment. [21] [ 49 ] The Court must apply this rule to determine whether the kitchen breakfast table, the wall mounted shelving in the basement, and a home entertainment system located in the basement should be considered immovables by attachment.

If they qualify as such, they should have remained in the Property. [ 50 ] The Court does not believe that the kitchen breakfast table is an immovable by attachment and an accessory for the purpose of

article 1718 C.C.Q. Based on the pictures of the breakfast table viewed by the Court and Mr. Gadbois’ testimony, this item was never permanently physically attached or joined to the Property. While it was fastened with screws to the wall of the kitchen, this was merely a safety measure meant to prevent the table from tipping over. Wall mounted shelving [ 51 ] The basement of the property was finished and included an area for watching movies and television on a pull down screen.

The projector and other audiovisual equipment rested on shelves which were fixed to the wall of the basement. [22] There were in total five shelves which were each supported by two brackets which were fixed to the wall with screws. [ 52 ] When the Defendants moved out, they removed the supporting brackets and five shelves from the wall. [ 53 ] Applying the criteria of

article 903 C.C.Q. , the Court does not consider these five shelves to constitute accessories within the meaning of

article 1718 C.C.Q. These were simple shelves purchased in a hardware store for a modest amount and were never permanently fastened to the wall. [ 54 ] The Defendants did not breach their obligation to deliver by removing these shelves. Home entertainment system [ 55 ] The basement included a home theater entertainment system. This included a projector which stood on one of the shelves discussed above, as well as a pull down screen. [ 56 ] Plaintiffs argue that these items constitute accessories within the meaning of

article 1718 C.C.Q. and should have been left in the property when the Defendants moved out. [ 57 ] The Court disagrees. The pull down screen was not permanently physically attached or joined to the property. It simply hung on two hooks and was easily removable without any tools. [ 58 ] Moreover, the projector was also not physically attached or joined to the property. It simply rested on shelves. [ 59 ] The speakers which were connected to the projector were similarly mounted to the wall with screws. There was no permanent physical attachment to the walls of the basement.

While the annex to the declaration by the seller [23] does mention ‘’home theater install basement’’, the projector screen and speakers were not included in the list of inclusions listed in the counter offer to the promise to purchase. [ 60 ] Finally, the Court adds that the Defendants’ real estate broker Mrs. Gardener testified that she specifically informed Mrs. Lemoine, the co-plaintiff, that the projector screen and speaker were not included in the sale when the house was visited on July 25.

This testimony is unrefuted. [ 61 ] Accordingly, the Court concludes that the Defendants did not breach their obligation to deliver by removing the projector, screen and speakers from the basement of the Property.

b) Did the Defendants deliver the property in a damaged condition? [ 62 ] Plaintiffs claim that the Defendants failed to deliver the property in the condition it was when they visited it on July 25.

Specifically they claim that they found many holes in the wall when they took possession on October 14, notably in the vestibule, the basement where the shelves were removed, in the living room, in the kitchen and in the master bedroom. [ 63 ] Defendants argue that these holes were small and were visible. [ 64 ] The evidence does indeed reveal that when the Defendants vacated the property, there were numerous small holes in the walls of the Property. [ 65 ] Many of the holes that the Plaintiffs complain of result from the removal of speakers or shelving from the Property. The Court

does not consider that these small holes constitutes breaches of the obligation to deliver the Property in the same state as it was when it was purchased. [ 66 ] A home buyer who purchases a property that has been lived in should expect to find small holes throughout the property and to have to repair these upon moving in. [24] As long as the size and the number of holes is reasonable, the seller does not breach its obligation to deliver. [ 67 ] In the instant case, these holes are indeed small as they are roughly the size of quarters or ten cent coins. [25] [ 68 ] The same is true for the bulging or damaged plaster that was found in the master bedroom behind the painting. [26] The Plaintiffs purchased a 115 year old property.

It is normal and reasonable to have imperfect plaster walls in properties of this age and construction considering the passage of time and construction methods that prevailed over 100 years ago. This does not constitute a breach of the obligation to deliver nor does it constitute a latent defect. [ 69 ] In conclusion the Defendants did not fail to deliver the Property in the condition it was on July 25.

c) Was the Property afflicted with latent defects? [ 70 ] Plaintiffs claim that they discovered the following latent defect after moving into the property: 1. Lighting fixture in the shower; 2. Missing glass in a basement pot light lighting fixture; 3. Electrical wiring defects; 4. Damaged window sill; 5. Scratched and discoloured master bedroom hardwood floors. [ 71 ] Each of these items will be addressed below. [ 72 ] This part of the Plaintiffs’ claim against the Defendants is based on the legal warranty against latent defects, which is codified in

article 1726 C.C.Q. and which reads as follows: III. Warranty of quality 1726. The seller is bound to warrant the buyer that the property and its accessories are, at the time of the sale , free of latent defects which render it unfit for the use for which it was intended or which so diminish its usefulness that the buyer would not have bought it or paid so high a price if he had been aware of them.

The seller is not bound , however, to warrant against any latent defect known to the buyer or any apparent defect ; an apparent defect is a defect that can be perceived by a prudent and diligent buyer without the need to resort to an expert. (Underlining added) [ 73 ] To succeed on a claim based on this warranty, the buyer(

s) must prove the following four conditions: • The defect must be sufficiently serious. A defect is serious where it seriously undermines normal usage of the good or which so diminishes its usefulness that the buyer would not have bought it or paid so high a price if he had been aware of it; • The defect must have existed at the time of the sale; • The defect was hidden ( i.e. , latent) or not apparent. An apparent defect is a defect that can be perceived by a prudent and diligent buyer without the need to resort to an expert; and • The defect was unknown to the buyer.

Since good faith is presumed, it is incumbent on the seller to prove the buyer’s knowledge. [27] [ 74 ] Moreover, the Civil Code requires, that the buyer must give notice in writing of the defect(

s) to the seller within a reasonable time after discovering it. [28] [ 75 ] Finally, the Civil Code also requires, that the buyer(

s) put in default its vendor prior to carrying out any repairs, except where the debtor is in default by the sole operation of the law or exceptional circumstances dispense the buyer from sending a demand letter. [29] [ 76 ] Where the conditions required for enforcing the warranty of quality have been proved, and the seller has been properly notified of the existence of the defects and put in default, the buyer is entitled, at his discretion, to the cancellation of the sale if the defect is sufficiently serious, or a reduction in the purchase prices which may be equivalent to the cost to repair the defects. [ 77 ] Time worn or outdated building materials or components, normal wear and tear, and the end of the useful life of a building component do not constitute latent defects covered by the legal warranty of quality. [30] 1.

Lighting fixture in the shower [ 78 ] Plaintiffs complain that the light fixture in the shower was missing a glass covering and that this constitutes a latent defect.

[ 79 ] The Court does not consider that this was a latent defect. Indeed, the shower light fixture was not hidden but apparent when the Plaintiffs visited the Property on two occasions prior to the sale. The co-plaintiff, Mr. Smith, admits that he did not look up to the ceiling when he looked into the shower. 2. Missing glass in a basement pot light lighting fixture [ 80 ] Plaintiffs claim that there is a missing piece of glass in one of the basement pot light lightning fixtures.

This defect was apparent because it could have been perceived by a prudent and diligent buyer without the need to resort to an expert. 3. Electrical wiring defects [ 81 ] Plaintiffs discovered that one of the electrical outlets in the master bedroom was not functioning when they took possession of the house and tried to plug in a television.

An electrician informed then that the outlet was not functioning properly because it was improperly connected to a light switch located in the ground floor at the front entrance. [ 82 ] The Court does not consider that this non-functioning power outlet constitutes a hidden defect. To the contrary, this defect was easily ascertainable by a prudent and diligent buyer upon the inspection of the property. [ 83 ] Moreover, the Court adds that the Plaintiffs were purchasing a 115 year old residence.

When purchasing such an old home, purchasers should expect over the years, changes have been made to the electrical system and the wiring may not be up to the standards of modern day electrical components. 4.

Window sill [ 84 ] The Plaintiffs claim that the concrete window sill of a window located on the second floor in the back of the Property was found to be in a deteriorated condition; a chunk of concrete fell to the ground. [31] [ 85 ] They paid $322 to have this repaired. [ 86 ] The pre-purchase home inspector hired by the Plaintiffs took numerous pictures of the outdoor windows of the property. [32] The author of the inspection reports notes that the windows are original wooden frame windows. [ 87 ] The Court does not consider the window sill issue to be a latent defect.

Firstly, it was visible prior to the purchase. Indeed, the Plaintiffs’ pre-purchase inspection report contains numerous pictures of window sills and windows. [ 88 ] Secondly, the Plaintiffs purchased a 115 year old home. It is normal to expect wear and tear and degradation of building materials when purchasing such an old property. 5.

Master bedroom hardwood floors. [ 89 ] Plaintiffs claim that they discovered large scratches and discoloring in the finishing of the hardwood floor covering in the master bedroom. [33] [ 90 ] The Court does not consider this to be a latent defect for the purposes of the warranty of quality. [ 91 ] Firstly, the hardwood floors were visible when the Property was visited and inspected.

The Plaintiffs’ pre-purchase building inspector notes in his report that the wood flooring is acceptable where visible, with normal wear and tear. [34] While the floor of the master bedroom was covered by a rug, this cover was not permanent, was small in size and could easily be lifted to ascertain the state of the floor underneath. [ 92 ] Secondly, as previously stated, in purchasing a 115 year old home, the Plaintiffs should have expected some discoloration and normal wear and tear, including scratches, in hardwood floors.

This does not constitute a latent defect. [ 93 ] In conclusion, the Court concludes that the Plaintiffs have not proven that the defects which they complain of constitute latent defects.

d) If the Defendants have breached their obligations under the contract of sale, what damages were caused to the Plaintiffs? [ 94 ] Considering that the Court has concluded above that the Defendants have not breached any of their obligations under the contract of sale, there is no need for the Court to address the issue of the damages claimed by the Plaintiffs.

e) Did Plaintiffs commit a fault towards the Defendants by instructing the notary to withhold the disbursement of the proceeds of sale, and if so, what damages were caused to the Defendants? [ 95 ] Defendants jointly claim $455 in damages from the Plaintiffs.

This amount represents the lost interest on the proceeds of sale for a seven day period during which they claim the notary, Mtre Gutierrez, illegally and without justification withheld the proceeds of sale. [ 96 ] After adjustments and paying off their mortgage, the net proceeds of sale available to the Defendants amounted to $477,335 [35] . [ 97 ] The sale closed on October 14 and the Defendants expected to receive the proceeds of sale on Monday, October 18, as the notary had prepared checks for each of them representing 50 % of the net proceeds of sale. [ 98 ] Ultimately, the Defendants were only remitted the proceeds of sale on October 24.

[ 99 ] It is true that after taking possession of the Property on October 14, Mr. Smith sent an email at 6:33 pm to the Defendants and the notary, wherein he instructed the notary to ‘’hold the money until we can resolve these issues’’. [36] This conduct was reasonable given the circumstances and does not constitute a fault. [ 100 ] Later during that same evening, Mr. Smith wrote again to the Defendants and indicated with respect to the held funds ‘’we can start by figuring a fair reserve the jointly agree to have the notary release the rest.

If you want call me at 514-…’’. [37] [ 101 ] It appears that the parties never agreed on a reasonable amount that would be held in trust by the notary pending the resolution of their dispute. [ 102 ] The Defendants have not discharged their burden of proving on clear and convincing evidence [38] that Mr. Smith committed a fault in asking the notary to stop the disbursement of funds on October 14 given the circumstances of this claim. [ 103 ] Accordingly, this portion of their crossclaim is dismissed.

f) Is Plaintiffs’ claim abusive within the meaning of

article 51 C.C.P. , and if so what damages were caused to the Defendants? [ 104 ] Defendants argue that the Plaintiffs’ claim is abusive within the meaning of

article 51 C.C.P. They each claim they’ve suffered $1,500 in damages because of this abusive procedure. [ 105 ] Articles 51, 53 and 54 of the Code of Civil Procedure set out the powers of a Court to sanction an abuse of procedure. The Court has the discretion to declare a judicial demand abusive and award damages. [ 106 ] Abuse of procedure is evident when a case is clearly unfounded, frivolous or intended to delay.

Abuse can also arise when a procedure is excessive or unreasonable or causes a prejudice to a person or attempts to defeat the ends of justice. [ 107 ] A finding of abuse and the implementation of the remedies provided for in articles 53 and 54 C.C.P . requires a finding of frivolity and the improper or reckless nature of the pleadings. The frailness of the right of action is not enough. [ 108 ] According to the Court of Appeal, a lawsuit is clearly unfounded and therefore abusive for the purposes of

article 51 C.C.P. if a reasonable and prudent person, placed in the circumstances known to the party at the time of filing the claim, would conclude that there was no basis for that proceeding. Is unfounded a procedure offering no real chance of success and brought with recklessness. [39] [ 109 ] In 4379047 Canada inc. v.

Papagiannis, Justice Paul Mayer aptly summarized as follow what constitutes an abusive judicial application: [126] The case law sets out that an abusive action is one that is rash and foolhardy, that is, one that a reasonable and prudent person in similar circumstance would conclude is without merit. This is an objective test that is to be examined regardless of intent. One needs to assess all of the circumstances of a case to be able to determine whether an action had a sound legal foundation when the procedure was taken.

One must determine whether the Plaintiffs had a veritable chance of success. [40] [ 110 ] In Cosoltec , the Court of Appeal states that cases of abuse and the appearance of abuse remain associated with the most egregious cases. [41] [ 111 ] The mere fact of taking an action is not in itself abusive.

Likewise, simply because a case is dismissed does not necessarily mean that it was abusive. [ 112 ] The Defendants have the burden of proving, on the balance of probabilities, that the Plaintiffs was foolhardy in proceeding with this case. [ 113 ] The Court does not consider that the Plaintiffs’ claim was abusive within the meaning of

article 51 C.C.P. While their claim will be dismissed, it nonetheless raised serious arguments and was not rash and foolhardy. FOR THESE REASONS, THE COURT: [ 114 ] DISMISSES Plaintiffs’ claim; [ 115 ] DISMISSES Defendants’ crossclaims; [ 116 ] WITHOUT COSTS on the principal claim and the crossclaim. __________________________________ ENRICO FORLINI, J.C.Q.

Date of hearing: February 22, 2019