2014 QCCQ 1727, 2014 QCCQ 1727

Danopoulos c. Maycid international inc. 2014 QCCQ 1727 COURT OF QUEBEC Small Claims Division CANADA PROVINCE OF QUÉBEC DISTRICT OF MONTRÉAL Civil Division No: 500-32-128704-113 DATE: MARCH 12, 2014 ______________________________________________________________________ PRESIDED BY THE HONOURABLE MARTINE L. TREMBLAY, J.C.Q. ______________________________________________________________________ ANDIGONI DANOPOULOS and EVANTHIA DANOPOULOS and PANAGIOTA DANOPOULOS and ARISTEA DANOPOULOS Plaintiffs v.

MAYCID INTERNATIONAL INC. and ABDULLAH MAYCID Defendants ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] Plaintiffs are claiming $7,000 from Defendants for the damages they caused Defendants, by accepting their Promise to purchase (P-4) the eastern part (the “ Eastern Part ”) of a greater property (the “ Property ”), that could not be sold until the Property had been properly subdivided.

Plaintiffs also claim Defendants caused them damage by failing, following the acceptance of the Promise (P- 4), to proceed diligently with the prerequisite cadastral operation. [ 2 ] Defendants plead that they have respected all their obligations under the Promise (P-4) and, by way of a cross-demand, ask that Plaintiffs be condemned to reimburse the $6,663.78 that Defendants paid to the land surveyor and the lawyer who dealt with the cadastral operation. QUESTIONS IN LITIGATION 1.

Were Defendants obliged to proceed to the subdivision of the Property prior to accepting the Promise (P-4) and/or did Defendants act diligently following the acceptance of the Promise (P-4)? 2. In the affirmative, what constitutes fair indemnification of Plaintiffs’ damages? 3. Are Plaintiffs obliged to pay the fee of the land surveyor and of the lawyer involved in the subdivision of the Property? THE RELEVANT FACTS [ 3 ] On February 22, 1995, 9001-1701 Québec inc. (“ 9001 ”), represented by Plaintiffs’ father, Mr. Spiros Danopoulos (“ Mr. Danopoulos ”) leased from Mr.

Paul-René Émond, the Eastern Part of the Property, with the building erected thereon, bearing civic number 4794, Saint-Charles Boulevard, in Pierrefonds (the “ Lease ”) (D-3). [ 4 ] The Lease (D-3) obliged 9001 to carry out important renovations to the existing building, used to operate a restaurant. It contained a clause giving 9001 the first option to buy the Eastern Part, should Mr. Émond decide to sell it (the “ Right of First Refusal ”).

It also guaranteed 25 parking spaces on the Eastern Part and on the adjacent property to the west (the “ Western Part ”) that was leased to Carrosserie d’autos Pierrefonds inc. (the “ Auto Body Shop ”). [ 5 ] Me Richard Bisante, who was 9001’s and Mr. Danopoulos’ notary, was involved when the Lease (D-3) was signed and he remained their legal advisor throughout the relevant period. [ 6 ] In 1996, Defendant Abdullah Maycid (“ Mr. Maycid ”) bought the Property from Mr. Émond, after 9001 had declined to exercise its option to buy the Eastern Part. [ 7 ] In 1997, Mr. Gokhan Kurtogulu (“ Mr.

Kurtogulu ”) became the owner of the Auto Body Shop and tenant of the Western Part.

[ 8 ] On September 28, 1998, Me Bisante confirmed (D-1) to Mr. Maycid’s attorney, Me James Bonhomme, that 9001 wanted to negotiate the purchase of the building and of 10,085 square feet of land, representing the minimum area required by the Boroughs of Pierrefonds-Roxboro’s (“Pierrefonds”) zoning by-law and allowing 11 parking stalls. Furthermore, 9001 wanted the possibility to benefit from extra parking spaces on 11,800 square feet of the remainder of the Property. This proposal (D-1) was to no avail. [ 9 ] In 2002, the Lease (D-3) was extended to October 31, 2017. [ 10 ] In July 2007, Mr.

Kurtogulu offered to purchase the Property from Mr. Maycid for $800,000. Aware of 9001’s Right of First Refusal, Mr. Maycid informed 9001 of Mr. Kurtogulu’s offer and told Mr. Danopoulos that 9001 could buy the Eastern Part from him for $300,000, provided that 9001 and Mr. Kurtogulu agreed on the parking and the right of way required to access the Auto Body Shop via Saint-Charles Boulevard. [ 11 ] At Mr. Danopoulos’ request, Me Bisante prepared the Promise (P-4) whereby Plaintiffs offered to buy the Eastern Property for $300,000.

Amongst other things, the Promise (P-4) was conditional upon the following: 2.2.3 the Vendor granting without consideration to the Purchaser a real, perpetual and uninterrupted servitude of passage (on foot and by vehicles) and parking to accommodate an additional fifteen (15 ) vehicles for the Purchaser’s employees, agents, representatives, patrons, guests and invitees to be taken on part of the Vendor’s property (lot number 1 348 853) along its north-east (excluding the servitude of passage granted herein) and south-east sides, in the front of his building (4796 Saint-Charles Boulevard) and if need be, on the south-east side of said building (to a maximum of ( ) vehicles, the whole as shown in red on a plan annexed hereto, as

Schedule “B” and signed for identification.

The maintenance of which (cleaning, snow removal) shall be the sole responsibility of the Purchaser. 2.2.4 each party shall grant to the other a real, perpetual, reciprocal and uninterrupted servitude of passage, as same is presently informally existing, to be taken on that strip of land to the north west side of the Property in order to allow the access and egress from Saint-Charles Boulevard to the Vendor’s property at the rear and to the Property, which strip has a width of more or less twenty-three feet (23’), approximately one-half (1/2) of which is situated on part of lot 1 348 853 (belonging to the Vendor) and the other approximate one-half (1/2) on part of lot 1 348 948; the whole as shown in yellow on a plan annexed hereto as

Schedule “C” and signed for identification. The maintenance of such passage (cleaning, snow removal, repairs and asphalting) shall be the sole responsibility of both the Purchaser and the Vendor and the cost thereof shall be borne by them in equal shares. [ 12 ] The Promise (P-4) also stipulated that: 3.4 The Purchaser shall have the title to the Property examined within fifteen (15) days of the receipt from the Vendor of the documents mentioned

section 4.4 hereafter 4.4 The vendor shall also supply, within three (3) business days of the date of acceptance of this Promise: […] 4.4.2 an authentic copy of a new certificate of location prepared by a Quebec Land Surveyor showing the present state of the Property and dated after the acceptance of this Promise. […] 4.10 Prior to the execution of the Deed of Sale, the vendor shall have obtained at his own cost a new cadastral number for the former lot 187-Pt.106 herein sold (being the part shown in red on the plan annexed hereto as

Schedule “A”), this being of essence and without which part Purchaser would have never made and sign this Promise. [ 13 ] The unsigned Promise (P-4) was used by Plaintiffs to obtain, from the Business Development Bank of Canada (“ BDC ”), the $250,000 loan required to close the purchase. [ 14 ] Mr.

Maycid obtained the unsigned copy of the Promise (P-4) from the BDC on August 22, 2007, and sent it to Me Bonhomme on August 29, 2007. [ 15 ] On August 28, 2007, the BDC issued a Commitment Letter (P-5) to Plaintiffs stating that commencing November 23, 2007, Plaintiffs would pay a monthly fee on any undisbursed loan amounts (the “Standby Fee” ). 9001 and Mr. Danopoulos had to guarantee the loan. [ 16 ] On August 31, 2007, Me Bonhomme forwarded to Me Bisante (P-8) the following comments on the Promise (P-4): 4.

Le certificat de localisation sera à la charge de votre client, cependant les délais peuvent être plus longs que trois jours (clause 4.4). 5. Quand au lot autrefois identifié par 187-Pt 106, notre client est d’accord pour collaborer et faire le nécessaire afin de pouvoir le céder à votre client pour la somme de 1.00 $. Cependant, en raison des délais importants, notre client ne veut pas attendre le résultat pour effectuer la transaction.

Les frais de géomètres et les frais légaux, le cas échéant, seront à la charge de votre client. (clause 4.10) En attente des nouvelles de votre client sous peu, veuillez agréer l’expression de nos sentiments les plus distingués.

[ 17 ] Me Bonhomme’s statement of account (D-7) indicates that he and Me Bisante had a discussion on August 30 and September 5, 2007 and that the services of land surveyor François Anglehart (“ Mr. Anglehart ”) were retained on September 12, 2007. [ 18 ] On September 24, 2007, Plaintiffs, Mr. Danopoulos and 9001 accepted the BDC’s Commitment Letter (P-5). Plaintiffs testified that Mr. Danopoulos was their representative in all negotiations and dealings with Mr. Kurtogulu and Mr. Maycid. [ 19 ] On April 10, 2008, Mr.

Anglehart submitted his plan of subdivision of the Property to Pierrefonds for approval (D-4). [ 20 ] Me Bisante confirmed that all issues were resolved and the final certificate of location was issued on October 1, 2008, which allowed him to proceed, first, with the sale of the property from Mr. Maycid to Maycid International Inc. (P-1), on October 7, 2008, and secondly, to the sale from Maycid International Inc. to Plaintiffs (P-2), on October 28, 2008. [ 21 ] As a result of the sale occurring later than November 23, 2007, Plaintiffs had to pay a Standby Fee of $6,985.

In addition, Plaintiffs claim that they had to prematurely cancel a $50,000 investment, thereby losing an additional amount of $4,000. However, they have agreed to reduce their total claim to $7,000 in order to avail themselves of their right to be heard in the Small Claims Division of this Court. ANALYSIS 1.

Were Defendants obliged to proceed to the subdivision of the Property prior to accepting the Promise (P-4) and/or did Defendants act diligently following the acceptance of the Promise (P-4)? [ 22 ] In order to succeed in their action, Plaintiffs have the burden of establishing [1] that Defendants committed a fault [2] , i.e. breached one of their obligations towards them, and, as a result, Plaintiffs sustained immediate, direct and foreseeable damages [3] . [ 23 ] From the outset, the Court has decided that the action against Maycid International inc. and the cross-claim of that company must be dismissed. Mr.

Maycid accepted the Promise (P-4) and was the owner of the Property at the time the Promise (P-4) was made and accepted. At the hearing, Me Bisante confirmed that Mr. Danopoulos knew of and accepted the sale of the Property by Mr.

Maycid to Maycid International inc. prior to the signing of the Deed of sale for the Eastern Property and, furthermore, that this transaction was not a source of delay. [ 24 ] The existing corporate veil between a corporation and its directors, shareholders and/or officers may be raised only in clear and well-defined cases that meet the criteria of the law, which are not present in this case. Mr. Maycid and Maycid International inc. are two different persons, having their own patrimony and the full enjoyment of their respective civil rights [4] .

This case is not one where the corporate veil can be lifted [5] . [ 25 ] Looking now at Mr. Maycid’s obligations with respect to the Promise (P-4), the Court concludes that its clause 4.10 establishes that Plaintiffs knew or should have known, at the time they made the Promise (P-4), that a new cadastral number needed to be obtained by Mr. Maycid prior to the execution of the deed of sale. At the trial, Me Bisante confirmed Mr.

Danopoulos’ knowledge and, in fact, Me Bonhomme’s letter of August 31, 2007 (P-8) made it abundantly clear that obtaining the new cadastral number would not only take time, but it would be at Plaintiffs’ costs. [ 26 ] Therefore, Plaintiffs cannot blame Mr. Maycid for having accepted the Promise (P-4) even if the Eastern Property still needed to undergo some cadastral operation. [ 27 ] Furthermore, once the Promise (P-4) was accepted, Plaintiffs failed to demonstrate that Mr.

Maycid did not act diligently. [ 28 ] The delay to obtain the new cadastral number could not start until the parties had agreed as to their respective obligations under the Promise (P-4). [ 29 ] Considering Me Bonhomme’s letter of August 31, 2007 (P-8), and Me Bisante’s testimony, the Court concludes that such an agreement did not exist prior to September 12, 2007, when Mr. Anglehart’s services were retained by Mr. Maycid [6] . [ 30 ] Mr. Danopoulos did not testify, but Mr. Kurtogulu and Me Bisante confirmed at the trial, that Mr. Danopoulos and Mr.

Kurtogulu had numerous discussions between themselves as well as with Mr. Anglehart to determine what part of the Western Part would be amputated to allow the restaurant to have enough parking spaces to meet the zoning by-law and the location of the right of way. Numerous drafts of the subdivision plan were prepared and submitted by Mr. Anglehart to Mr. Kurtogulu and Mr. Danopoulos. In fact, Mr. Kurtogulu testified that he did not even approve the plan dated March 4, 2008 (P-7). [ 31 ] In the absence of evidence to the contrary, the Court therefore concludes that the plan submitted by Mr.

Anglehart to Pierrefonds, on April 10, 2008, (D-4), was almost contemporaneous to the date at which Mr. Danopoulos and Mr. Kurtogulu agreed upon the subdivision of the Property. Access to enough parking spaces was always important to Mr. Danopoulos as appears from the Lease (D-3), the offer of September 28, 1998 (D-1) and the Promise (P-4). [ 32 ] There is also no evidence of how long it took Pierrefonds to approve of the plan (D-4). Afterwards, Mr. Anglehart had to submit a request for the cadastral operation to the Minister of Natural Resources and Wildlife of Québec (the “Minister” ).

Considering Me Bisante’s testimony that this step alone can explain a delay of up to four months, Plaintiffs did not offer any evidence to support their claim that Mr. Maycid could have done more to speed up the process at Pierrefonds’ or at the Minister’s level. 2. In the affirmative, what constitutes fair indemnification of Plaintiffs’ damages? [ 33 ] Considering the answer given to the first question, there is no need for the Court to comment any further on Plaintiffs’ alleged damages.

3. Are Plaintiffs obliged to pay the fee of the land surveyor and of the lawyer involved in the subdivision of the Property? [ 34 ] Mr. Maycid invokes clause 4.10 of the Promise (P-4) to claim the reimbursement of the fees that he paid to Mr. Anglehart and Me Bonhomme for the work related to the Property’s subdivision. [ 35 ] With respect to Mr. Anglehart’s two invoices, and considering

article 4.2 of the Promise (P-4), the Court concludes that only the invoice of $2,668.63, dated April 3, 2008, is attributable to the cadastral operation. [ 36 ] With respect to Me Bonhomme’s invoice of $5,534.86 (D-7), Mr. Maycid admitted at the hearing that he arbitrarily determined that $3,417 was for the cadastral operation. The Court disagrees. [ 37 ] Me Bisante testified that in early January 2008, he took over that task from Me Bonhomme. Therefore, only part of the work done by Me Bonhomme, between September 12, 2007, and December 21, 2007, can be considered for the purposes of clause 4.10.

Considering the lack of information on the actual time spent by Me Bonhomme on that task, the Court will arbitrarily [7] establish the amount to $300. FOR THESE REASONS, THE COURT: [ 38 ] DISMISSES Plaintiffs’ action; [ 39 ] CONDEMNS Plaintiffs to pay Defendants the sum of $2,968.63, solidarily, plus interest at the legal rate of 5 % per annum plus the additional indemnity provided by

Article 1619 C.C.Q ., calculated as of June 29, 2011; [ 40 ] CONDEMNS Plaintiffs, solidarily, to pay Defendants the judicial fees of $194 paid on the contestation and of $81.75 on the cross-claim. ________________________________ MARTINE L. TREMBLAY, J.C.Q. Date of hearing: January 17, 2014