2019 QCCA 1726, 2019 QCCA 1726

Le Fèvre c. Aurora Interactive Ltd. 2019 QCCA 1726 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No: 500-09-026920-173 ( 500-17-084346-140 ) MINUTES OF THE HEARING DATE: September 26, 2019 CORAM: THE HONOURABLE JACQUES DUFRESNE, J.A. MARK SCHRAGER, J.A. CLAUDINE ROY, J.A. APPELLANT COUNSEL Pierre Le Fèvre Mtre Zavie Levine ( Levine Frishman Lancry ) RESPONDENTS COUNSEL Aurora Interactive LTD. Aurora Mscope Inc. Erik L. Yeo 1891243 Ontario Inc. Mtre Philippe A.

Couture-Ménard ( Miller Thomson LLP ) On appeal from a judgment rendered on June 6, 2017 by the Honourable Justice Silvana Conte of the Superior Court , District of Montreal . NATURE OF THE APPEAL: Labour law - Successive employers - Application of

Article 2097 of the Civil Code of Quebec .

Clerk at the hearing : Samia Kamal Courtroom: Antonio-Lamer HEARING 14:03 Commencement of the hearing. Identification of counsel. Submission by Mtre Levine. 14:31 Discussion between the Court and Mtre Levine. 14:40 Submissions by Mtre Couture-Ménard. 14:45 Discussion between the Court and Mtre Couture-Ménard. 14:55 Reply by Mtre Levine. Recess of the hearing. 15:12 Resumption of the hearing. Question by the Court to Mtre Couture-Ménard regarding the legal costs. 15:13 BY THE COURT : Judgment rendered forthwith by the Honourable Jacques Dufresnes, J.A. – see page 3. Conclusion of the hearing.

Samia Kamal, Clerk at the hearing JUDGMENT [ 1 ] For the reasons which will be filed in the record of the Court in the following days; THE COURT: [ 2 ] DISMISSES the appeal; [ 3 ] THE WHOLE without legal costs. JACQUES DUFRESNE, J.A. MARK SCHRAGER, J.A. CLAUDINE ROY, J.A.

Le Fèvre c. Aurora Interactive Ltd. 2019 QCCA 1738 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No: 500-09-026920-173 (500-17-084346-140) DATE: October 2, 2019 CORAM: THE HONOURABLE JACQUES DUFRESNE, J.A. MARK SCHRAGER, J.A. CLAUDINE ROY, J.A. PIERRE LE FÈVRE APPELLANT – Plaintiff v. AURORA INTERACTIVE LTD AURORA MSCOPE INC. ERIK L. YEO 1891243 ONTARIO INC.

RESPONDENTS – Defendants REASONS FOR THE JUDGMENT RENDERED FROM THE BENCH ON SEPTEMBER 26, 2019 [1] This is an appeal from a judgment rendered on June 6, 2017 by the Superior Court, District of Montreal (the Honourable Silvana Conte), dismissing the Appellant’s claim for severance, moral damages and le gal fees. [1] [2] The Appellant seeks to set aside the trial judgment on the basis that the judge erred by concluding that Aurora MScope Inc. (formerly, 1891243 Ontario Inc.) was not the successor of Aurora Interactive Ltd. (hereinafter “Interactive”) as per

Article 2097 C.C.Q . [3] This appeal raises a question of alienation of an enterprise or change in its legal structure, contemplated by

Article 2097 C.C.Q., with respect to the Appellant, the president and CEO of the Respondent Interactive. The Appellant was terminated months before all the movable property of the said corporation was taken in payment by its major creditor, controlled by its main shareholder, the Respondent Erik L. Yeo, pursuant to its hypothecary rights. [ 4 ] In first instance, the Appellant claimed his severance based on three grounds: a Paulian action under

Article 1631 C.C.Q. , the personal liability of the Respondent Yeo under

Article 1457 C.C.Q. and the liability of 1891243 as the successor employer of Interactive under

Article 2097 C.C.Q. and the employment contract. [ 5 ] However, the Appellant’s only ground of appeal is that the judge erred in concluding that 1891243 was not the successor of Aurora within the meaning of

Article 2097 C.C.Q. and the employment contract. Consequently, only this aspect of the judgment will be discussed herein. [ 6 ] The trial judge dismissed the Appellant’s claim regarding the application of

Article 2097 C.C.Q . First, she correctly determined that the employment contract did not bind 1891243. Second, she determined that

Article 2097 CCQ was not applicable to the Appellant’s situation. [ 7 ] Considering the application of

Article 2097 C.C.Q. , she determined that there was no alienation of an enterprise or change in legal structure that affected Interactive since only its assets were taken in payment by a creditor. She added that the Appellant’s termination “was not caused by the taking in payment or alienation or change to Interactive’s legal structure”; the Appellant was terminated months before. [ 8 ] The issue raised in the present appeal is a question of mixed fact and law. Indeed, the question raised by the appeal relates to the application of legal principles to the facts in evidence. Thus, the standard of review is that of a palpable and overriding error. [2]

[ 9 ] We express no opinion on whether the taking in payment of the assets in this case constituted an alienation of the enterprise contemplated by

Article 2097 C.C.Q. However, the Appellant had not been employed by Interactive for a number of months prior to the taking in payment.

Article 2097 C.C.Q. provides that a contract of employment is not terminated by the alienation of the enterprise. This pre-supposes that such a contract is in force. In this case, the Appellant does not contest that his contract of employment was terminated months prior to the taking-in-payment and the purported alienation of the enterprise; indeed, he claims the severance arising from that termination.

The judgment of the Court in Aero-Photo upon which the Appellant relies is based on fundamentally different facts since the firing of the employee in that case occurred mere hours prior to the bankruptcy (wherein the alienation of the enterprise was effected) and on the facts of the case was deemed invalid by the Court. [3] Thus, the contract of employment was still in force upon the alienation of the enterprise. [ 10 ] These are the reasons for which the present appeal was dismissed from the bench following the hearing, without costs. JACQUES DUFRESNE, J.A. MARK SCHRAGER, J.A. CLAUDINE ROY, J.A.

Mtre Zavie Levine LEVINE FRISHMAN LANCRY For the Appellant Mtre Philippe A. Couture-Ménard MILLER THOMSON LLP For the Respondents Date of hearing: September 26, 2019