2023 QCCA 823, 2023 QCCA 823

Unofficial English Translation of the Judgment of the Court 9302-5773 Québec inc c. West Coast Aircraft Sales and Leasing Ltd. 2023 QCCA 823 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-029698-214 ( 500-17-096647-162 ) (500-17-097208-170) MINUTES OF HEARING DATE: May 11, 2023 CORAM: THE HONOURABLE MARIE-FRANCE BICH, J.A. FRÉDÉRIC BACHAND, J.A. PETER KALICHMAN, J.A.

APPELLANT COUNSEL 9302-5773 QUÉBEC inc Mtre françois daigle m tre pHILIPPE DAIGLE ( Daigle & Matte, Tax attorneys ) By videoconference RESPONDENTS COUNSEL west coast aircraft sales and leasing ltd . m tre audrey chiasson-séguin Mtre marc lapointe ( RPGL Lawyers ) AMC AEROSPACE CONSULTANT INC. Mtre RAPHAËL MORISSETTE ( Lafortune Cadieux ) On appeal from a judgment rendered on August 6, 2021, by the Superior Court, District of Montreal (the Honourable Judith Harvie). NATURE OF THE APPEAL: Sale – Latent defect – Helicopter – Liability – Professional seller – Broker.

Hearing clerk: Vitélina Saint-Phard Room: Pierre-Basile-Mignault

HEARING 11:08 a.m. Hearing opens. Identification of case and counsel. Preliminary remark by the Court. 11:10 a.m. Submissions by Mtre Daigle. 11:25 a.m. Question from the Court and answer from Mtre Daigle. 11:29 a.m. Mtre Daigle continues his submissions. 11:34 a.m. Question from the Court and answer from Mtre Daigle. 11:36 a.m. Mtre Daigle continues his submissions. 11:47 a.m. Questions from the Court and answers from Mtre Daigle. 11:57 a.m. Recess. 12:15 p.m. Hearing resumed. Question from the Court to the respondents and answer from Mtre Morissette. 12:17 p.m.

The Court refuses to receive additional documents, that is, Mtre Morissette’s professional fees that were not sent to the appellant. 12:18 p.m. Recess. 12:23 p.m. Hearing resumed. 12:25 p.m. Submissions by Mtre Chiasson-Séguin. 12:34 p.m. Question from the Court and answer from Mtre Chiasson-Séguin. 12:38 p.m. Submissions by Mtre Morissette. 12:42 p.m. Discussion between the Court and Mtre Morissette. 12:50 p.m. Reply by Mtre Daigle. 12:53 p.m. Questions from the Court and answers from Mtre Daigle. 12:55 p.m. Recess. 1:32 p.m. Hearing resumed. 1:35 p.m. BY THE COURT : Judgment – see page 5. 1:40 p.m.

End of hearing.

Vitélina Saint-Phard, Hearing clerk JUDGMENT [ 1 ] The appellant appeals from a judgment of the Superior Court, District of Montreal (the Honourable Judith Harvie), [1] dismissing its claim for latent defects against the respondent West Coast Aircraft Sales and Leasing Ltd. (“West Coast”), from whom it purchased the helicopter in question in June 2015, as well as its claim for misrepresentation against the respondent AMC Aerospace Consultant Inc. (“AMC”), who acted as broker during this transaction. * * * [ 2 ] To start, the appellant raises two grounds in the action against West Coast. [ 3 ] First, it submits that the trial judge made a reviewable error by refusing to characterize West Coast as a professional seller.

Its ground is peculiar in that while it acknowledges that the judge’s conclusion contains no reviewable error under the current state of the law, the appellant asks the Court to amend the legal framework on the notion of professional seller so that it henceforth extends to those who, through their actions or representations, convince third parties that they are a regular or specialized seller.

Note that the appellant’s position differs considerably from its position in its notice of appeal, where it argued that the judge had committed an error of mixed fact and law by characterizing West Coast as a non-professional seller. Also to be noted is that the appellant cites no commentary or case law establishing the need to review the rules on the notion of professional seller. [2] [ 4 ] This first ground has no basis, and this can be determined without having to address the appellant’s argument on the need to review the notion of professional seller.

The evidence in the record does not support a conclusion that at the time of the sale, West Coast,

through its actions or representations, convinced the appellant that it was doing business with a professional seller. Moreover, in its brief, the appellant did not even try to establish that the judge had committed one or more reviewable errors by finding, first, that the helicopter’s transmission and air conditioning [3] were not defective at the time of the sale and second, that the seating and painting problems arose from normal wear and tear of the good, which furthermore, was a used good.

The appellant nonetheless insisted on addressing this issue during the appeal hearing but, in addition to being clearly late, the few observations it made disregarded the applicable appellate standard of review. [ 5 ] The appellant’s second ground, presented in the alternative, raises fraud perpetrated due to West Coast’s failure to do what was necessary so that the purchasers were not misled about its status as a non-professional seller. As the respondents correctly noted, this ground is inadmissible because the appellant raised it for the very first time in its appeal brief.

In so doing, it ignored, without valid reason, two well-established rules:

i) barring exceptions, the conditions of which are not met in this case, [4] new grounds cannot be raised on appeal; [5] ii) in its brief, the appellant cannot substantially depart from what is set out in its notice of appeal, which means that it cannot raise new grounds unless authorized to do so. [6] * * * [ 6 ] Let us turn to the action against AMC. The appellant argues first that AMC acted as West Coast’s mandatary during the June 2015 sale. The appellant presented no argument, however, to prove that the judge made a reviewable error by refusing to characterize AMC as a mandatary.

This ground must fail. [ 7 ] Can AMC nonetheless be held extracontractually liable for two of the four problems raised, i.e., those related to the helicopter’s transmission and air conditioning? The judge found that these two components were not affected by any defect at the time of the sale and that AMC did not know – and could not know – about the risk of corrosion of the transmission.

As stated above, until the appeal hearing, the appellant had not even tried to prove that these findings were tainted by palpable and overriding errors, and the arguments it raised very late did not take into account the applicable appellate standard of review. This second ground must also be dismissed. [ 8 ] Last, the appellant claims that the judge should have held AMC liable for failing to disclose its business relationship with Mirabel Héli Support Inc. (“MHS”) to the appellant.

Although the judge did find that AMC was at fault in failing to disclose that it had paid MHS a commission after it informed AMC that the appellant wanted to buy a helicopter, the judge concluded that this fault was inconsequential. On this last point, the appellant’s arguments are limited to conjecture on what it would have done had it been aware of the relationship between AMC and MHS: it might have chosen another inspector, might have changed broker, might have chosen not to conclude the transaction, and might have inquired further into the source and condition of the aircraft and into West Coast itself.

These arguments do not establish that the judge’s conclusion is tainted by any error that warrants the Court’s intervention. * * * [ 9 ] The respondents ask the Court to condemn the appellant to reimburse them part (for West Coast) or all (for AMC) of their legal fees incurred on appeal. West Coast’s claim is based on articles 51 et seq . and 342 C.C.P.

It believes that the appellant’s change of position on the issue of professional seller is an abuse of procedure and a substantial breach of the guiding principles of procedure, including proportionality [7] and the duty of all parties to any civil proceeding to cooperate. [8] AMC relies on articles 51 et seq. C.C.P. and considers the appeal against it abusive. [ 10 ] The Court considers that the entire appeal should be declared abusive.

With respect to the proceeding against West Coast, although the appellant eventually acknowledged that the ground raised in its notice of appeal was doomed to fail, it insisted on proceeding by substituting a principal ground doomed to fail and an alternative ground that was clearly inadmissible. The changes of position continued during the appeal hearing. As for the part of the appeal concerning AMC, the appellant also advanced grounds based on obviously deficient reasoning.

In the Court’s eyes, [ translation ] “a reasonable and prudent person in the appellant’s situation would not have appealed the Superior Court judgment and would have understood that his grounds of appeal had no chance of success”. [9] [ 11 ] Until the appeal hearing, West Coast’s claim was limited to the legal fees it incurred between the time the notice of appeal was filed and the time it received the appellant’s brief. It was claiming $15,771.29.

At the hearing, and without warning the appellant, it presented an oral application for punitive damages of $15,000. [ 12 ] This recent application is clearly late and should not be granted. The Court takes this opportunity to remind the litigants that it generally takes a dim view of applications for a declaration of abuse, or those based on

article 342 C.C.P., presented orally at the appeal hearing. A respondent who believes that the appeal is abusive or that the opposing party committed substantial breaches within the meaning of

article 342 C.C.P. should generally describe its position and specify the conclusions sought in its brief or memorandum. [ 13 ] However, the Court will grant the application for reimbursement of West Coast’s legal fees, but only in part. West Coast did not file detailed invoices [10] and because it cannot benefit from this failure, it will be entitled to only $5,000. [ 14 ] AMC claims all its legal fees incurred on appeal. While it filed detailed invoices, they cover only the period ending on June 22, 2022.

At the hearing, the Court refused to allow it to file invoices for services provided by its lawyers since that date, because these documents were not first sent to the appellant. [ 15 ] The total amount of fees described in the invoices in the record is $15,807.50, and the appellant defers to the Court’s discretion as to their reasonableness. Given the circumstances of the case, the invoices filed by AMC, and the importance of preventing overcharged legal services, [11] the Court finds that the amount to which AMC is entitled should be set at $10,000. FOR THESE REASONS, THE COURT:

[ 16 ] DISMISSES the appeal, with legal costs; [ 17 ] DECLARES that the appeal is an abuse of procedure; [ 18 ] CONDEMNS the appellant to pay the respondent West Coast Aircraft Sales and Leasing Ltd. $5,000 plus interest at the legal rate as of the date of this judgment; [ 19 ] DISMISSES the oral application for punitive damages by the respondent West Coast Aircraft Sales and Leasing Ltd.; [ 20 ] CONDEMNS the appellant to pay the respondent AMC Aerospace Consultant Inc. $10,000 plus interest at the legal rate and the additional indemnity set out in

article 1619 of the Civil Code of Québec as of the date of this judgment. MARIE-FRANCE BICH, J.A. FRÉDÉRIC BACHAND, J.A. PETER KALICHMAN, J.A.