2022 QCCA 1380, 2022 QCCA 1380

Sigounis c. Sigounis 2022 QCCA 1380 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-030015-226 ( 500-11-052150-170 ) MINUTES OF HEARING DATE: June 2, 2022 CORAM: THE HONOURABLE MARIE-JOSÉE HOGUE, J.A. STEPHEN W. HAMILTON, J.A. PETER KALICHMAN, J.A.

APPELLANT COUNSEL ARGYRO SIGOUNIS Mtre DOMINIQUE ZAURRINI Mtre LéO DI BATTISTA ( Zaurrini Avocats ) RESPONDENTS COUNSEL DIMITRIOS (JIMMY) SIGOUNIS Mtre LOUIS-george BRUNET ( Gagnon, Brunet, Kilani ) ELENI MAKRIDIS (SIGOUNIS), in her capacity as Liquidator of the Estate of the Late Nicolas Sigounis and in her capacity as designated Particular and Universal Legatee in virtue of the Last Will and Testament of the Late Nicolas Sigounis and subject to the decision of the exercise and option with respect to the Estate of the Late Nicolas Sigounis Mtre ROBERT PANCER ( Phillips Friedman Kotler ) IMPLEADED PARTIES AMALIA SIGOUNIS 114753 CANADA INC. 114754 CANADA INC. 136585 CANADA INC.

CHENOY DELICATESSEN & STEAK HOUSE INC. CHENOY DELICATESSEN & STEAK HOUSE

(1976) LTD. CHENOY FOOD NETWORK INC. N.K.D.S. CONSULTANTS & INVESTMENTS INC. ABSENT AND UNREPRESENTED

On appeal from a judgment rendered on March 18, 2022 by the Honourable Michel A. Pinsonnault of the Superior Court , District of Montreal . DESCRIPTION: Application to suspend provisional execution (Articles 355, 660 and 661 C.C.P .) Clerk at the hearing : Ariane Simard-Trudel Courtroom: Pierre-Basile-Mignault HEARING 9:30 Commencement of the hearing. Continuation of the hearing held on May 30, 2022. The parties were excused from appearing in Court. Conclusion of the hearing.

Ariane Simard-Trudel, Clerk at the hearing JUDGMENT [ 1 ] The Appellant has appealed from a judgement of the Superior Court (the Honourable Michel Pinsonnault) ordering the dissolution and liquidation of a group of family-owned companies (the Chenoy Group ), in which she, her brother, her sister and their late father, were shareholders. [ 2 ] The judge ordered the provisional execution of the judgment notwithstanding appeal. The Court is seized with a motion brought by the Appellant to suspend provisional execution.

The application is contested by the brother, the Respondent, and the estate of their late father, the Respondent-in-continuance-of-suit.

It should be added that two motions to dismiss the appeal as having no reasonable chance of success were both dismissed. * * * [ 3 ] In 2017, the Respondent brought an application before the Superior Court claiming that his rights as a shareholder were being unfairly disregarded and seeking the liquidation and dissolution of the various companies forming part of the Chenoy Group. [ 4 ] The Appellant and her father contested the Respondent’s application and proposed instead to purchase his interest in the Chenoy Group. [ 5 ] Most of the companies forming part of the Chenoy Group are inactive and possibly insolvent.

However, one of the companies ( Chenoy DDO ) owns a property that is worth millions of dollars. Another company, wholly owned by Chenoy DDO, operates a restaurant that has been in existence since the 1970’s and is the last of more than a dozen that at one time operated under the Chenoy’s banner ( DDO Restaurant ).

The Appellant has worked at the DDO Restaurant since she was a teenager and is now the manager. [ 6 ] In the judge’s view, the “central issue” with respect to the proposed liquidation and dissolution revolved around two competing considerations: the Appellant’s desire to continue to operate the DDO Restaurant and the Respondent’s contention that the land owned by Chenoy DDO is worth far more than the building housing the DDO Resturant or the value of its ongoing business. [ 7 ] In a lengthy and detailed decision, the judge granted in large part Respondent’s application. He concluded that the Respondent,

as a shareholder of the Chenoy Group, had indeed been the subject of repeated acts of oppression. He ordered the liquidation and dissolution of all entities in the Chenoy Group except for the DDO Restaurant, in regards to which he reserved his decision pending the receipt of a report to be prepared by the court-appointed liquidator setting out his recommendation on the best way to “deal with” the DDO Restaurant in the context of the liquidation of Chenoy DDO.

The judge ordered provisional execution of the judgment notwithstanding appeal. [ 8 ] The Appellant contends that the judge erred in ordering the liquidation of the Chenoy Group instead of giving effect to her offer to purchase the Respondent’s shares.

In addition, she maintains that he committed a number of manifest and determinative errors of fact, notably by considering the evidence of a witness who did not testify before him, in concluding that her father’s estate was insolvent, in basing himself on a memorandum of agreement that had been concluded in an entirely different court file and in holding that there had been “asset-stripping” on the part of her late father. * * * [ 9 ]

Article 661 of the Civil Code of Procedure provides that an order of provisional execution can be lifted by the Court or one of its judges. To satisfy the requirements of this disposition, the Appellant must demonstrate an apparent weakness in the judgment, a risk of serious or irreparable harm if provisional execution is not lifted and that the balance of harm favours granting her request. [ 10 ] The criteria of apparent weakness has been somewhat tempered in the jurisprudence and grounds of appeal that are considered to be serious can suffice.

Furthermore, in exceptional situations, where the refusal to lift the order of provisional execution will render the appeal academic, the lack of apparent weakness will not be an impediment to granting the application. [1] That is the case here. [ 11 ] Even though the judgment excludes the DDO Restaurant from the liquidation and dissolution order – at least for now – the Appellant’s right of appeal will be rendered academic if provisional execution is maintained since Chenoy DDO, which owns the DDO Restaurant and the land on which it is located, will be liquidated. [ 12 ] Furthermore, while the Respondent and the Respondent-in-continuation-of-suit have a clear interest in seeing the litigation come to an end, the harm they will suffer if provisional execution is lifted is not as great as what the Appellant will suffer if the judgment is executed and the liquidation goes forward before her appeal can be heard.

The balance of harm favours the Appellant. [ 13 ] The Court is satisfied that the Appellant meets the requirements for lifting the order of provisional execution. [ 14 ] That having been said, since the DDO Restaurant will continue to operate pending the appeal, it may be appropriate that its operations be subject to certain controls.

The Superior Court judge, having managed this matter for many years, is well-placed to issue such an order if necessary and remains seized of the file in regards to issues such as this. [ 15 ] The judge also remains seized of other issues that he described in paragraph 569 of the judgment: CONVENES Plaintiff Dimitrios (Jimmy) Sigounis, Defendant Argyro Sigounis and Defendant in continuance of suit Eleni Makridis Sigounis to a management conference in order to plan the next steps to be taken in connection with the outstanding issues raised in the Amended Declaration of intervention and the Cross-Demand both filed by Defendant in continuance of suit Eleni Makridis Sigounis and in the Paulian Action filed by Plaintiff Dimitrios (Jimmy) Sigounis (File 500-17-117432-214) (the “ Outstanding Issues ”), the whole at a time and date to be determined ulteriorly; [ 16 ] The suspension will not apply to the conclusion set out in this paragraph. [ 17 ] Finally, at the hearing of Appellant’s motion, the Respondent-in-continuance-of-suit made a subsidiary request that Appellant be ordered to furnish security of $475,000.

The request, which was made verbally and without prior notice, will not be granted. The Court agrees with the Appellant that there is no reason to order a suretyship, particularly given the value of Chenoy DDO. FOR THESE REASONS, THE COURT: [ 18 ] GRANTS the Motion to suspend provisional execution of the judgment rendered on March 18, 2022 by the Superior Court (the Honourable Michel A. Pinsonnault) with the exception of the conclusion set out at paragraph 569, with legal costs to follow suit. MARIE-JOSÉE HOGUE, J.A. STEPHEN W. HAMILTON, J.A. PETER KALICHMAN, J.A.