2018 QCCQ 2543, 2018 QCCQ 2543

Ringrose c. 9341-7798 Québec inc. 2018 QCCQ 2543 COURT OF QUEBEC Practice Division CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL “Civil Division” No: 500-22-240316-177 DATE: April 19, 2018 ______________________________________________________________________ BY THE HONOURABLE JEFFREY EDWARDS, J.C.Q. ______________________________________________________________________ CAROL RINGROSE Plaintiff-Respondent v. 9341-7798 QUÉBEC INC.

Defendant-Applicant ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] 9341-7798 Quebec Inc. (“ 9341 ”) makes an Application for Revocation of Judgment regarding a default judgment rendered on February 21, 2018 (“ Default Judgment ”). 9341 states that it became aware of the Default Judgment on March 1, 2018. Plaintiff Ms. Carol Ringrose does not contest that the Application was filed within the prescribed time limits.

She does contest that the Application for Revocation is based upon sufficient reasons, in accordance with

Article 348 of the Code of Civil Procedure ( C.C.P. ). Context Original Proceeding [ 2 ] On June 23, 2016, Ms. Ringrose and a co-owner sold to 9341 a residential property located on Lavigne Street in the City of Châteauguay, Province of Quebec, for the amount of $240,000 [1] . 9341 payed $160,000 at the time of the sale and guaranteed payment of the balance of sale of $80,000 by way of promissory note [2] .

An amount of $50,000 was to be paid no later than December 23, 2016 [3] .The remaining amount of $30,000 was to be paid no later than June 23, 2017 [4] . [ 3 ] Defendant uses the unregistered trade name “J’achète des maisons Ca$h” [5] . [ 4 ] 9341 made neither payment stipulated in the promissory note. The promissory note stipulates that, in the event of default to pay the first payment, the second payment is immediately exigible [6] .

[ 5 ] On May 17, 2017, Ms. Ringrose’s attorney sent 9341 a demand letter requesting payment of $80,000, with interest. [ 6 ] On July 12, 2017, Ms. Ringrose instituted the Original Proceedings against 9341. [ 7 ] There were problems trying to effect service on 9341. On August 25, 2017, service by special mode was authorized. [7] [ 8 ] On September 11, 2017, 9341 filed an Answer through attorneys. [ 9 ] On October 10, 2017, a Case Protocol was signed. Under the Case Protocol, 9341 requested and was authorized to file a written defence by December 15, 2017.

Nonetheless, 9341 did state in the Case Protocol that the amount claimed was “not owed”. [ 10 ] On October 18, 2017, the attorneys of 9341 filed a notice to cease representing their client. [ 11 ] On November 13, 2017, after a Notice to Designate New Attorneys was served on 9341, Legal Logik Inc. filed a Notice of Representation as the new attorneys of 9341. At the firm Legal Logik Inc., the file was assigned to Me Nour Zadah. [ 12 ] The new attorneys asked for and obtained an extension of two weeks for the deadline mentioned in the Case Protocol for the examination before plea of Ms.

Ringrose. [ 13 ] On November 24, 2017, Me Émilie Chevrier, attorney of Ms. Ringrose, wrote to Me Zadah in part as follows: “Le ou vers le 8 novembre 2017, vous avez accepté de prendre la relève dans le présent dossier en étant pleinement consciente du protocole de l’instance signé par les parties et il est maintenant de votre responsabilité de respecter les délais convenus.

Nous avons accepté de vous accorder par courtoisie un délai supplémentaire de deux (2) semaines pour étudier les procédures et procéder à l’interrogatoire au préalable de notre cliente dans le présent dossier qui, soulignons-le, est dénué de toute complexité. L’inaction et l’absence de collaboration du représentant de votre cliente, qui se formalise peu du protocole et qui semble retarder indûment le dossier, causent préjudice à la nôtre.

Nous réitérons que l’interrogatoire doit se tenir au plus tard d’ici la fin novembre 2017 et que nous sommes entièrement disponibles du lundi 27 novembre au jeudi 30 novembre 2017 inclusivement pour la tenue dudit interrogatoire. … À défaut par votre cliente de se conformer au protocole de l’instance convenu entre les parties, votre cliente deviendra par sa propre inaction forclose d’interroger notre cliente et sera éventuellement en défaut de produire une défense avec les conséquences qui en découlent ” [Emphasis added.]

[ 14 ] On December 1, 2017, Me Zadah e-mailed Me Chevrier to inform her that she was leaving the firm of Legal Logik Inc. and that henceforth, the attorney responsible for the file would be Me Jamie Benizri [8] . [ 15 ] On December 4, 2017, Me Chevrier wrote to Me Benizri as follows: “Je vous réfère à notre courriel ci-dessous daté du 24 novembre et je compte sur votre entire collaboration pour respecter le protocole de l’instance ci-joint convenu entre les parties. Votre cliente est maintenant forclose d’interroger notre cliente et nous demeurons dans l’attente de recevoir le

sommaire écrit des moyens de défense de votre cliente au plus tard le 15 décembre 2017 .” [9] [Emphasis added.] [ 16 ] Despite that e-mail, 9341 did not file a defence by December 15 2017, as it committed to do in the Case Protocol. [ 17 ] On December 18, 2017, the attorney of Ms. Ringrose filed an Inscription for Judgment by Default to Plead. The inscription stated that it would be presented on December 28, 2017.

That Inscription by Default to Plead was served on Legal Logik Inc. [10] [ 18 ] The Inscription for Judgment by Default to Plead was not contested at the time of its presentation. [ 19 ] On February 21, 2018, the Default Judgment was rendered by the Special Clerk condemning 9341 to pay Ms. Ringrose $80,000, plus interest, additional indemnity and legal costs. Application for Revocation of Judgment [ 20 ] On March 21, 2018, 9341 filed and served an Application for Revocation of Judgment.

The only ground alleged in the Application to explain the omission to file a written defence by December 15, 2017, as stipulated in the Case Protocol, or to contest the presentation of the Inscription for Judgment by Default to Plead is as follows: “That at that time, the dates for the case protocol were not entered in the administrative calendar.” [11] [ 21 ] Me Zadah was served by subpoena to attend and testify at the hearing of the Application for Revocation. [ 22 ] At the hearing, Me Zadah stated that she was discharged in part from her duty of confidentiality or professional secrecy as a result of that allegation.

She invoked

Article 65, paragraph 4 of the Code of Professional Conduct of Lawyers of the Barreau du Québec [12] which states:

65. L’avocat peut communiquer un renseignement confidentiel dans les cas suivants: … 4 o pour se défendre en cas de poursuite, de plainte ou d’allégations mettant en doute sa compétence professionnelle ; 65.

A lawyer may communicate confidential information in the following situations: … (4) in order to defend himself in the event of proceedings, complaints or allegations calling his professional competence or conduct into question ; [Emphasis added.] [ 23 ] Furthermore, at the hearing on the Application for Revocation, the representative of 9341 waived the right of confidentiality of Me Zadah with regard to internal administrative operations at Legal Logik Inc. and Me Zadah’s conduct regarding the transition of the 9341’s file from herself to Me Benizri. [ 24 ] Me Zadah testified that while working as an independent (not employee) attorney of Legal Logik Inc., she was not made aware of any firm administrative calendar for the entry of procedural deadlines or prescription dates.

Her testimony was not rebutted or countered by Me Benizri. [ 25 ] Me Zadah also testified that, during her transition and transfer of the 9341’s file to Me Benizri, she specifically mentioned to the latter the existence of the upcoming deadlines and wrote them down on a transition document placed on top of the 9341 file folder and that she personally delivered that file to Me Benizri [13] . [ 26 ] The Court is of the view that the preponderance of the evidence disproves the only ground alleged to explain the omission to file a defence before the expiry of the stipulated deadline.

Furthermore, whether the deadline was recorded in an agenda or not, there is no explanation offered as to why the served Inscription for Judgment by Default to Plead, containing a ten (10) day notice, was not adequate to ensure that the defence was filed before the date of its presentation, namely December 28, 2017. [ 27 ] Before the Court, Me Benizri stated that his office offers a “ mea culpa ” for the defence not being filed before the agreed deadline or the date of presentation of the Inscription for Judgment for Default to Plead deadline. However, no specific explanation was offered.

Defence to the Original Demand [ 28 ] Article 346 (2) C.C.P. reads as follows: The application for revocation must contain the reasons justifying the revocation as well as the grounds of defence raised against the demand . [Emphasis added.]

[ 29 ] In the Application for Revocation, 9341 alleges a Cross-Application and requests judicial compensation against amounts allegedly owed to it by Ms. Ringrose. [ 30 ] In particular, 9341 alleges that [14] : - upon taking possession of the property, it was not in the same condition as it was at the time of the sale; - 9341 had to undertake work to restore its condition; - the delay of Ms.

Ringrose to move out resulted in additional costs. [ 31 ] No amounts are alleged in support of these grounds of Cross-Application. [ 32 ] No invoices or other exhibits are alleged either. [ 33 ] There is no evidence that 9341 ever advised in writing Ms.

Ringrose of any of these complaints before the service of the Application for Revocation almost two years after the sale. [ 34 ] When questioned by the Court as to the apparent lack of seriousness of these grounds, the attorney of 9341, after consultation with the representative of his client, offered the following further details: - There were borrowing costs, missed opportunity for resale, renovations, interest over the extended period of resale and an unanticipated real estate commission. [ 35 ] Again, no documents whatsoever were supplied or offered to support these further details. [ 36 ] 9341 states that it sold the property for approximately the same price that it paid to Ms.

Ringrose. [ 37 ] 9341 is in the business of reselling or “flipping” residential real estate. Renovations costs are normal and to be anticipated in such a business. Improvement costs are not attributable to Ms. Ringrose. [ 38 ] As presented to the Court at the hearing on the Application for Revocation, these additional grounds do not appear serious either. They appear to be anticipated and normal costs for the reselling of residential used property. Furthermore, they also appear minor compared to the amount of the outstanding and acknowledged unpaid balance of sale of $80,000. [ 39 ] The attorney of Ms.

Ringrose states that before the hearing she had never heard from the attorneys of 9341 of such heads of damages to be claimed against her client. Analysis and Decision Absence of Serious Grounds Justifying the Revocation

[ 40 ] The only ground alleged in the Application for Revocation to justify the revocation, namely the omission to enter the dates of the Case Protocol in an office agenda, has been established as unfounded in fact. [ 41 ] The extremely vague and undetailed nature of the unalleged verbal supplemental grounds of general omission at Legal Logik Inc. were not serious either. [ 42 ] Me Benizri submits that those verbal and unalleged general grounds should be sufficient in light of the traditional jurisprudence that the error of the attorney is not that of her or his client [15] . [ 43 ] Counsel for Ms.

Ringrose argues that the unspecified nature of omissions, in light of the constant e-mails, reminders and notices sent by her, are not credible and can only constitute gross negligence on the part of an attorney. Counsel for Ms. Ringrose argues that such conduct cannot be accepted as a ground for revocation [16] . Absence of Serious Grounds of Defence [ 44 ] The Application for Revocation alleges no grounds of defence to the Original Demand regarding the default to pay the promissory note. The only grounds alleged are those of a nature of a Cross-Application seeking judicial compensation under

article 172 C.C.P. [ 45 ] In effect, paragraph 18 of the Application for Revocation reads as follows: “That Defendant is in its rights to effect compensation for the damages which shall be quantified forthwith against the amount claimed by Plaintiff herein;” [ 46 ] Counsel for Ms. Ringrose states correctly that if the Application for Revocation is dismissed, 9341 will continue to have its rights, if any, to institute separate legal proceeding against Ms. Ringrose based on its claims in the nature of a Cross-Application.

Conclusion [ 47 ] The Court concludes that: 1) there are no grounds alleged in the Application for Revocation to support the revocation. The sole ground alleged was disproved by the evidence; 2) the unspecified, general and unalleged other grounds are unproven, vague and unsubstantiated.

They do constitute a sufficient “cause” in virtue of Article 346 (1) C.C.P.; 3) there are no grounds, serious or otherwise, of defence raised against the Original Demand. 4) the grounds alleged to counter the Original Demand contained in the Application for Revocation are claims in the nature of a Cross- Application requesting judicial compensation. As presented at the time of the hearing on the Application for Revocation, these grounds are not serious.

There is no document, invoice or other exhibit to support them, some two years after the facts in issue and some six months after service of the Original Proceeding. Furthermore, the supplemental verbal details provided to attempt to explain them at the hearing dilute further their seriousness.

Nevertheless, the dismissal of the Application for Revocation of Judgment will not prevent 9341 from instituting separate legal proceedings against Ms. Ringrose to seek these claims if in fact they can be supported by credible proof, which is currently absent. [ 48 ] Based upon the above, the Court concludes that the reasons given in support of the Application for Revocation are not sufficient within the meaning of Article 348 (1) C.C.P. The Application for Revocation will therefore be dismissed.

FOR THESE REASONS, THE COURT: DISMISSES the Application for Revocation of Judgment; WITH LEGAL COSTS , including the amount paid by Ms. Ringrose or her attorney, for service and attendance costs for the subpoena issued to Maître Nour Zadah. __________________________________ Jeffrey Edwards, J.C.Q. Me Émilie Chevrier Barrette & Associés avocats inc. Attorneys for Plaintiff Me Jamie Benizri Legal Logik inc. Attorneys for Defendant Date of hearing: April 18, 2018