2020 QCCA 873, 2020 QCCA 873

Official English Translation of the Judgment of the Court Lacroix c. Autorité des marchés financiers 2020 QCCA 873 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF QUEBEC NO.: 200-09-009660-173 / 200-09-010110-192 (200-05-020363-177) (200-11-025040-182) DATE: JULY 7, 2020 CORAM: THE HONOURABLE LOUIS ROCHETTE, J.A. PATRICK HEALY, J.A. SIMON RUEL, J.A. No.: 200-09-009660-173 (200-05-020363-177) DOMINIC LACROIX APPELLANT – Defendant v. AUTORITÉ DES MARCHÉS FINANCIERS RESPONDENT – Plaintiff No.: 200-09-010110-192 (200-11-025040-182) DOMINIC LACROIX APPELLANT – Defendant v.

AUTORITÉ DES MARCHÉS FINANCIERS RESPONDENT – Plaintiff and RAYMOND CHABOT ADMINISTRATEUR PROVISOIRE INC. RESPONDENT – Receiver JUDGMENT [ 1 ] The appellant appeals against a judgment rendered on December 8, 2017 by the Honourable Mr. Justice Marc Lesage of the Superior Court, District of Quebec that fined him $10,000 and sentenced him to serve a term of imprisonment of two months (file 200-09-009660-173). [ 2 ] He also appeals against a judgment rendered on October 9, 2019 by the Honourable Mr.

Justice Daniel Dumais of the Superior Court, District of Quebec that ordered him to perform 240 hours of compensatory community work and sentenced him to a total term of imprisonment of six months (file 200-09-010110-192). [ 3 ] For the reasons of Ruel, J.A., with which Rochette and Healy, JJ.A. agree; THE COURT : [ 4 ] ALLOWS the appeals in part; [ 5 ] REVERSES the conclusions set forth in paragraphs 63, 64 and 65 of the judgment rendered in file 200-09-009660-173 and reformulates them as follows, adding conclusion 65.1:

[63] IMPOSES a term of imprisonment of two (2) months on the defendant Dominic Lacroix, to be served in a detention centre; [64] ORDERS the administrator of the detention centre to admit and hold the defendant Dominic Lacroix; [65] DIRECTS law enforcement officers and any bailiff of this Court to apprehend the defendant Dominic Lacroix, to bring him safely to the Centre de détention de Québec and to deliver him to the administrator of the Centre de détention de Québec so that the sentence of imprisonment can be carried out; [65.1] ORDERS the defendant Dominic Lacroix to appear before the Court on the fifteenth day following the date of this judgment, and at such intervals as the Court may subsequently determine, it being understood that he may, at any time, request that the Court hold a hearing so that he can explain that he has complied with the orders or intends to comply therewith on a specific date; [ 6 ] REVERSES the conclusions set forth in paragraphs 82 and 83 of the judgment rendered in file 200-09-010110-192 and reformulates them as follows, adding conclusions 83.1 and 83.2: [82] IMPOSES a term of imprisonment of two (2) months for each count on the defendant Dominic Lacroix, to be served in a detention centre; [83] ORDERS the administrator of the detention centre to admit and hold the defendant Dominic Lacroix; [83.1] DIRECTS law enforcement officers and any bailiff of this Court to apprehend the defendant Dominic Lacroix, to bring him safely to the Centre de détention de Québec and to deliver him to the administrator of the Centre de détention de Québec so that the sentence of imprisonment can be carried out; [83.2] ORDERS the defendant Dominic Lacroix to appear before the Court on the fifteenth day following the date of this judgment, and at such intervals as the Court may subsequently determine, it being understood that he may, at any time, request that the Court hold a hearing so that he can explain that he has complied with the orders or intends to comply therewith on a specific date.

LOUIS ROCHETTE, J.A. PATRICK HEALY, J.A. SIMON RUEL, J.A. Mtre Sarah Desabrais For the appellant Mtre Annie Parent Mtre Nathalie Chouinard Litigation

Section of the Autorité des marchés financiers For the respondent Autorité des marchés financiers Mtre Hugo Babos-Marchand Mtre Marie Rondeau Borden, Ladner For the respondent Raymond Chabot administrateur provisoire inc. Date of hearing: February 12, 2020 REASONS OF RUEL, J.A. Overview [ 7 ] The principal issue at stake in these appeals is the nature of the sentence of imprisonment that may be imposed following a conviction for civil contempt of court pursuant to

article 62 of the new Code of Civil Procedure (the “new Code ”) for failure to comply with a court order or injunction. [ 8 ] That provision states that if a person refuses to comply with an order or injunction, the court may, “in addition to the sanction imposed” (the fine, the compensatory community work or a combination of the two), order imprisonment for the term it specifies. The person so imprisoned “ must be summoned before the court periodically to explain themselves, and imprisonment may be ordered again

until the person complies”. In no case can the total imprisonment exceed one year. [ 9 ] Is this a punitive or coercive measure? What, if any, are the consequences of this characterization? [ 10 ] Under the former Code of Civil Procedure (the “former Code ”), imprisonment for contempt of court applied to every type of contempt and had a mixed punitive and coercive purpose. The new Code provides that imprisonment for civil contempt applies only to the violation of court orders or injunctions.

It is now a coercive measure for the enforcement of judgments that may be imposed in addition to the actual sanctions, i.e., a monetary penalty or compensatory community work. [ 11 ] This characterization has consequences. Without completely setting aside considerations stemming from criminal and penal law, the applicable criteria for imposing coercive imprisonment for civil contempt must be redefined. The main criteria for issuing a coercive order of imprisonment for civil contempt are necessity and proportionality. [ 12 ] Imprisonment for civil contempt should be an exceptional measure used as a last resort.

In all cases, the imprisoned person must be summoned before the court periodically to explain themselves. This is so that the court can maintain control over the coercive mechanism and ensure that the imprisonment genuinely satisfies its fundamental objective, which is to compel the person in question to comply with the order or injunction.

Background [ 13 ] The appellant appeals against a judgment rendered on December 8, 2017 by the Superior Court that fined him $10,000 and sentenced him to a term of imprisonment of two months [1] for contempt of court [AMF File]. [ 14 ] The appellant also appeals against a judgment rendered on October 9, 2019 by the Superior Court that ordered him to perform 240 hours of compensatory community work and sentenced him to a total term of imprisonment of six months [2] for another instance of contempt of court [RCAP File]. [ 15 ] The appellant was the focus of an investigation carried out by the Autorité des marchés financiers (the “AMF”) in connection with the sale and solicitation of the “plexcoin”, a cryptocurrency he invented.

The AMF considered these activities to be illegal, and the Financial Markets Administrative Tribunal (the “FMAT”) agreed. Orders were issued so that these activities would cease and so that investors’ funds could be recovered. [3] AMF File [ 16 ] On July 20, 2017, the FMAT made three orders against the appellant which, inter alia , prohibited him from carrying on activities for the purpose of engaging in investment transactions and ordered him to withdraw all advertisements of a similar nature and shut down the websites for his cryptocurrency.

These orders were worded as follows: [ translation ] PROHIBITS PlexCorps, PlexCoin, DL Innov inc., Gestio inc. and Dominic Lacroix from carrying on any activities in furtherance of a direct or indirect transaction in any form of investment described in

section 1 of the Securities Act , including the making of representations and the solicitation of investors, within Quebec or outside Quebec from within Quebec; ORDERS PlexCorps, PlexCoin, DL Innov inc., Gestio inc. and Dominic Lacroix to withdraw all advertisements or solicitations of a similar nature to that made on the websites www.plexcorps.com and www.plexcoin.com, Facebook, from any discussion website or other website, or in connection with securities or any form of investment, whether published or disseminated through the Internet or otherwise, directly or indirectly, by the aforementioned persons; ORDERS PlexCorps, PlexCoin, DL Innov inc., Gestio inc. and Dominic Lacroix to shut down the websites www.plexcorps.com and www.plexcoin.com or any other site of a similar nature to those sites, published or disseminated by them, whether directly or indirectly, or failing same, to make them inaccessible from any IP address in Quebec so as to prevent any person residing in Quebec from consulting these websites and order the publication of the order to be made by the Financial Markets Administrative Tribunal on the home page of these websites; [4] [ 17 ] On August 14, 2017, upon application by the AMF, a judge of the Superior Court summoned the appellant to appear for contempt because he had failed to comply with the orders made on July 20, 2017. [5] On October 17, 2017, the Superior Court found him guilty of contempt of court. [6] On December 8, 2017, the Court fined him $10,000 and sentenced him to a term of imprisonment of two months. [7] [ 18 ] The judge was of the view that discussions between the appellant and his employee Yan Ouellet showed his flippancy and his intention to disobey the orders.

There were no mitigating factors that could affect the sentence. [8] [ 19 ] The judge considered the public interest as well as the appellant’s considerable enrichment resulting from his conduct in contravention of the FMAT’s orders.

Having noted the 2013 judgment rendered against the appellant for securities activities as well as an undertaking given by the appellant in 2011 to cease such activities, which undertaking he breached, the judge concluded that the pursuit of such activities was a repeat offence warranting two months of imprisonment. [9] RCAP File [ 20 ] Notwithstanding the various orders made by the FMAT, the AMF noted the appellant’s lack of cooperation, particularly as

regards the recovery of the sums paid by investors to purchase plexcoins. Consequently, the AMF sought the appointment of a receiver with broad investigative powers, so as to obtain a rendering of accounts from the appellant, track down investors’ assets and convert and cash in such assets. [10] [ 21 ] The Superior Court allowed the application on July 5, 2018 and appointed Raymond Chabot as receiver (“RCAP”). [11] [ 22 ] In November 2018, the AMF informed RCAP that the appellant still held cryptocurrencies in a portfolio address designated as 1CLu4.

RCAP then filed an application in Superior Court for a rendering of accounts. [12] [ 23 ] On January 17, 2019 a case management hearing was held by telephone in order to set a hearing date for RCAP’s application.

At that time, the appellant agreed to provide a statement of his activities as well as a rendering of accounts regarding any cryptocurrency under his control, and he further agreed to submit to a search protocol involving the disclosure of passwords providing access to the computer equipment that had been seized. [13] Orders were made on January 18, 2019 in accordance with this agreement. [14] [ 24 ] On January 31, 2019, another case management hearing was held, given that the appellant had failed to comply with the orders made on January 18, 2019.

During that case management hearing, the judge made an additional order for the disclosure of the usernames and passwords for the computer equipment. [15] [ 25 ] The January 18, 2019 orders at issue in the present matter are worded as follows: [ translation ] [8] ORDERS Dominic Lacroix to provide Raymond Chabot administrateur provisoire inc. with a sworn statement of his assets and liabilities within two (2) days of this judgment, which statement shall be prepared on the agreed upon form annexed hereto; [9] ORDERS Dominic Lacroix to provide to the receiver, within ten (10) days of this judgment, a complete accounting with respect to any cryptocurrency, including the bitcoins found at or having passed through the address 1CLu4Wkbw1gtQBtKfMYAC2SWc9qe43wmXW, that is or has been under his direct or indirect control or was obtained within the scope of the “plexcoin project” (collectively the “Cryptocurrency”), indicating therein the following information: The quantity and type of Cryptocurrency.

The date(

s) on which the Cryptocurrency was received and its (their) origin. Where and how the Cryptocurrency was deposited and is conserved. All public and private keys associated with the Cryptocurrency. All details regarding each time Cryptocurrency was converted into fiat currency (money that is legal tender in any country), into goods, into other Cryptocurrency, or in any other manner whatsoever. All details of all transactions carried out with respect to Cryptocurrency. All details of each time Dominic Lacroix received Cryptocurrency as a result of holding Cryptocurrency (e.g.: forks).

The name and the contact information of all persons, corporations, partnerships or entities whatsoever that hold Cryptocurrency, directly or indirectly, or have received Cryptocurrency. [16] [ 26 ] The additional order made on January 31, 2019 is the following: [ translation ] ORDERS Mr.

Dominic Lacroix to send, by tomorrow, February 1, 2019, at 4 p.m., the passwords and usernames required to access the items seized by the receiver, which passwords and usernames the receiver and the computer expert shall treat confidentially. [17] [ 27 ] On February 22, 2019, the appellant was summoned to appear before the Superior Court for contempt of court for having violated these three orders. [18] On July 12, 2019, the appellant was found guilty of contempt of court. [19] On October 9, 2019, he was sentenced to perform 240 hours of compensatory community work and serve a total term of imprisonment of six months. [20] [ 28 ] The judge noted the appellant’s lack of cooperation and effort.

He intentionally violated the orders and continued to carry out the prohibited financial transactions. There were no mitigating factors. [21] [ 29 ] The judge considered the documentary evidence produced by the appellant at the hearing to be incomplete and found that, instead, it showed his capacity to properly comply with the orders. He was convinced that the appellant knew more than he intimated and that he held the requested codes, usernames and passwords.

He therefore sentenced the appellant to imprisonment of two months per count, to be served consecutively in order to compel him to comply. [22] The judge wrote: [ translation ] [77] In light of all of the foregoing, including the prior sentence of two months’ imprisonment, the Court imposes a total sentence of six months (namely, two months per count), to be reassessed if the defendant agrees to comply with the orders to the Court’s satisfaction.

It will be up to him to notify the Court through his counsel so that a hearing to that effect can be held. [23] [ 30 ] The judge’s conclusion regarding the imprisonment was as follows:

[ translation ] [82] SENTENCES the defendant to six (6) consecutive months of imprisonment (two months per count), it being understood that the Court may reassess the duration of the sentence if the defendant agrees to comply with the orders to the Court’s satisfaction and acts accordingly; [24] [ 31 ] The appellant appeals the judgments on “the sentence” in the AMF and RCAP Files. Certain points overlap and first require an analysis of the applicable legal framework, namely,

article 62 of the new Code , as well as an analysis of the regime of imprisonment for contempt of court under the former Code .

Analysis Legal considerations [ 32 ] Contempt of court is intimately tied to the preservation of the rule of law, because it allows the courts to uphold their dignity and enforce their processes and judgments. [25] [ 33 ] Traditionally, contempt of court in civil matters is intended to punish and dissuade persons from breaching court orders, thereby fostering respect for the administration of justice. [26] It is an exceptional power to be used only as a last resort and not routinely. [27] [ 34 ] Civil contempt of court, which is quasi-criminal, is largely influenced by the rules of criminal law and penal law.

The essential elements of the offence of contempt of court must be proved beyond a reasonable doubt. The guarantees against compellability set out in s. 11(

c) of the Canadian Charter of Rights and Freedoms and in s. 33.1 of the Charter of Human Rights and Freedoms apply and the contemnor is not competent to be called as a witness for the prosecution. [28] [ 35 ] These principles are not being questioned in these appeals. [ 36 ] To properly grasp the scope of the issues raised, it would be useful to review the law pertaining to sanctions for civil contempt of court under the former Code . The former Code [ 37 ] The contempt of court provisions were set out in articles 50, 51 and 761 of the former Code . Articles 50 and 51 read as follows [emphasis added]: 50.

Anyone is guilty of contempt of court who disobeys any process or order of the court or of a judge thereof, or who acts in such a way as to interfere with the orderly administration of justice, or to impair the authority or dignity of the court. In particular, any officer of justice who fails to do his duty, and any sheriff or bailiff who does not execute a writ forthwith or does not make a return thereof or, in executing it, infringes any rule the violation whereof renders him liable to a penalty, is guilty of contempt of court. 51.

Except where otherwise provided, anyone who is guilty of contempt of court is liable to a fine not exceeding $5,000 or to imprisonment for a period not exceeding one yea r. Imprisonment for refusal to obey any process or order may be repeatedly inflicted until the person condemned obeys. 50. Est coupable d’outrage au tribunal celui qui contrevient à une ordonnance ou à une injonction du tribunal ou d’un de ses juges, ou qui agit de manière, soit à entraver le cours normal de l’administration de la justice, soit à porter atteinte à l’autorité ou à la dignité du tribunal.

En particulier, est coupable d’outrage au tribunal l’officier de justice qui manque à son devoir, y compris le shérif ou huissier qui n’exécute pas un bref sans retard ou n’en fait pas rapport ou enfreint, en l’exécutant, une règle dont la violation le rend passible de sanction. 51. Sauf dans les cas où il est autrement prévu, celui qui se rend coupable d’outrage au tribunal est passible d’une amende n’excédant pas 5 000 $ ou d’un emprisonnement pour une période d’au plus un an .

L’emprisonnement pour refus d’obtempérer à une ordonnance ou à une injonction peut être imposé derechef jusqu’à ce que la personne condamnée ait obéi . [ 38 ]

Article 761 of the former Code dealt more specifically with persons who breached or refused to comply with an injunction [emphasis added]:

761. Any person named or described in an order of injunction, who infringes or refuses to obey it, and any person not described therein who knowingly contravenes it, is guilty of contempt of court and may be condemned to a fine not exceeding $50,000, with or without imprisonment for a period up to one year , and without prejudice to the right to recover damages. Such penalties may be repeatedly inflicted until the contravening party obeys the injunction . The court may also order the destruction or removal of anything done in contravention of the injunction, if there is reason to do so. 761.

Toute personne nommée ou désignée dans une ordonnance d’injonction, qui la transgresse ou refuse d’y obéir, de même que toute personne non désignée qui y contrevient sciemment, se rendent coupables d’outrage au tribunal et peuvent être condamnées à une amende n’excédant pas 50 000 $, avec ou sans emprisonnement pour une durée d’au plus un an , et sans préjudice à tous recours en dommages-intérêts. Ces pénalités peuvent être infligées derechef jusqu’à ce que le contrevenant se soit conformé à l’injonction .

Le tribunal peut également ordonner que ce qui a été fait en contravention à l’injonction soit détruit ou enlevé, s’il y a lieu. [ 39 ] Thus, the first paragraph of

article 50 of the former Code established the general jurisdiction of the courts to hold a person in contempt, while

article 761 dealt specifically with the breach of injunctions. [29] [ 40 ] This fragmentation of the penalty provisions for contempt of court gave rise to classification debates with a view to determining the range of applicable penalties. For example, our Court stated: [ translation ]

Article 761 [of the former Code ], when it refers to “any person not described therein who knowingly contravenes it”, includes only those persons against whom the injunction could have been granted in law, but against whom it was not considered appropriate to grant the injunction on factual grounds. Any other person who acts in a manner such that the injunction is breached can be held in contempt only under

article 50 [of the former Code ]. [30] [ 41 ] Moreover, under

article 51 of the former Code , it did not seem possible to combine a fine with imprisonment, while this was expressly permitted under

article 761. Pursuant to

article 51, the contemnor was liable to a fine or imprisonment. [31] [ 42 ] Under the former Code , imprisonment for contempt of court served both punitive and coercive purposes, with more or less emphasis on one or the other depending on the nature of the case. [ 43 ] The coercive purpose of imprisonment for contempt of court can be seen in Di Iorio v. Warden of the Montreal Jail , [32] where the appellants were convicted of contempt of court for having refused to testify at the hearings of a public commission of inquiry. They were sentenced to one year of imprisonment pursuant to

article 51 of the former Code . [ 44 ] Responding to the appellants’ constitutional argument to the effect that this was a “criminal” matter, Pigeon, J. noted that the sentences imposed on the appellants were based exclusively on enactments of the provincial legislature. [33] He added that the appellants’ committal “was coercive not punitive” [34] and that “the imprisonment would determine [as of right] as soon as the person committed yielded obedience to the order of the tribunal, just as it could be inflicted again and again if the contempt was persisted in”. [35] [ 45 ] The punitive purpose of imprisonment for contempt of court is apparent in Vidéotron Ltée v.

Industries Microlec Produits Électroniques inc. , [36] which addressed the issue of whether a person could be compelled to testify in a proceeding in which the person had been cited for contempt of court for having breached an injunction.

The majority found that the person was not compellable, noting that: “[t]he penalty for contempt of court, even when it is used to enforce a purely private order, still involves an element of ‘public law’”. [37] [ 46 ] Moreover, these judges were of the view that civil contempt “may result in punishment by imprisonment for one year, under art. 51 [of the former Code ]” [emphasis added]. [38] With this in mind, they added that [emphasis and bold added]: […] because of the public law aspects of contempt of court, particularly that of imprisonment, it must be subject to certain rules of fundamental justice, even if its effectiveness might thereby be reduced. […] contempt of court cannot be reduced to a simple means of enforcing judgments.

If contempt of court (and the attendant possibility of imprisonment) were found to be inadequate in some cases, precisely because it is being used essentially to enforce judgments, it would then be for the legislature to provide for other means of enforcement, if necessary . [39] [ 47 ] L’Heureux-Dubé, J., dissenting, did not, however, share this point of view.

She was of the opinion that “the art. 761 [former Code ] contempt of court proceeding is, first and foremost, a means of enforcing an injunction order ” [emphasis added]. [40] She stated that the objective of imprisonment for civil contempt in injunction matters is coercion: The powers of the court, first among which is imprisonment, are directed to a specific end: the protection of the applicant’s rights through compelling the respondent to act, or to refrain from committing given acts as defined in the injunction order. There is no

punitive or deterrent purpose underlying these powers. [41] [ 48 ] Thus, under the former Code , in order to enforce court orders or injunctions, imprisonment for civil contempt had a dual purpose, coercive and punitive, and was part of the sanctions that could be imposed, in the same manner as fines.

Indeed, [ translation ] “[c]ontempt of court proceedings involved both the civil enforcement of an injunction and the criminal sanction of an offence against the administration of justice” [emphasis added]. [42] [ 49 ] The punitive component of imprisonment for civil contempt had significant legal consequences, because this measure required the court to consider objectives and principles that must be applied when imposing sentences in criminal and penal matters, primarily the principle of proportionality, and it also required the court to consider penological goals, namely, denunciation, deterrence, reparation and the promotion of a sense of responsibility in the contemnor.

Indeed, as this Court wrote in Douek c. Brossard [emphasis added]: [ translation ] [14] As regards the grounds of appeal from the sentence , it should be noted that the objectives and principles for determining the sentence for civil contempt are well established. The primary objective of sentencing for contempt of court is to contribute to compliance with the law and court orders and thereby preserve the rule of law in a just, peaceful and safe society. In that regard, it has the following objectives: (

a) denounce non-compliance with a court order; (

b) deter the contemnor from disobeying court orders in the future; (

c) provide reparations for the harm done to the victims and to the community; and (

d) promote a sense of responsibility in the contemnor. The sentence must be proportionate to the gravity of the contempt and the degree of responsibility of the contemnor.

It must take into account the aggravating and mitigating circumstances of the contempt, the contemnor’s situation and the harmonization of sentences. [43] [ 50 ] These objectives and principles stemming from criminal and penal law were applied, under the former Code , when sentences of imprisonment for civil contempt were imposed (or set aside). [44] [ 51 ] Finally, the punitive nature of imprisonment for civil contempt gave rise to certain other jurisprudential debates, particularly regarding the possibility of considering sanctions other than a fine or imprisonment. [45] In Trudel c.

Foucher , this Court summarized the debate on this matter as follows: [ translation ] [74] Are there sentences other than those provided for in the Code of Civil Procedure as a sanction for contempt? The Court refused on two occasions to opine directly on this issue. [75] In my view,

article 51 C.C.P . is unambiguous and does not require

interpretation. It does not authorize donations as a pecuniary sanction. [76] In Québec (Autorité des marchés financiers) c. Roy , the Court nevertheless concluded that there was a third option. Judges may, pursuant to

article 46 C.C.P ., their inherent powers or both, suspend the passing of sentence. In such a situation, could a court give the defendant the opportunity to make a donation? [77] The parties did not consider this option, at trial or on appeal, nor did the judge. Determining whether a judge can impose a positive condition when he or she has suspended the passing of sentence raises a number of questions of principle and procedure. That said, it would not be appropriate to opine without the complete context and in the absence of a full legal debate. [46] The new Code [ 52 ] Articles 58 and 62 of the new Code provide as follows [emphasis added]:

58. A person who disobeys a court order or injunction or acts in such a way as to interfere with the orderly administration of justice or undermine the authority or dignity of the court is guilty of contempt of court. A person not named in an injunction or protection order who disobeys that injunction or protection order is guilty of contempt of court only if the person does so knowingly. 62.

The only sanctions that may be imposed for contempt of court are (1) payment of a punitive amount not exceeding $10,000 for contempt committed by a natural person, or $100,000 for contempt committed by a legal person , a partnership or an association or another group not endowed with juridical personality, in which case the judgment is executed in accordance with

Chapter XIII of the Code of Penal Procedure (chapter C-25.1 ); and (2) performance , by the person or the person’s officers, of compensatory community work the nature, terms and duration of which are determined by the court. If the person refuses to comply with the court order or injunction, in addition to the sanction imposed, the court may order imprisonment for the term it specifies. The person so imprisoned must be summoned before the court periodically to explain themselves, and imprisonment may be ordered again until the person complies. Imprisonment can in no case exceed one year. 58.

Se rend coupable d’outrage au tribunal la personne qui contrevient à une ordonnance ou à une injonction du tribunal ou qui agit de manière à entraver le cours de l’administration de la justice ou à porter atteinte à l’autorité ou à la dignité du tribunal. En matière d’injonction et d’ordonnance de protection, la personne qui n’y est pas désignée ne se rend coupable d’outrage au tribunal que si elle y contrevient sciemment. 62 . Les seules sanctions qui peuvent être prononcées pour punir l’outrage au tribunal sont les suivantes : 1° paiement, à

titre punitif, d’un montant qui n’excède pas 10 000 $ si l’outrage est le fait d’une personne physique, ou 100 000 $ s’il est le fait d’une personne morale , d’une société ou d’une association ou d’un autre groupement sans personnalité juridique, auquel cas le jugement est exécuté conformément au

chapitre XIII du Code de procédure pénale (chapitre C-25.1 ); 2° l’exécution par la personne même ou par ses dirigeants, de travaux d’utilité sociale dont la nature, les conditions et la durée sont établies par le tribunal. Si la personne refuse d’obtempérer à l’ordonnance ou à l’injonction, le tribunal peut, en sus de la peine imposée, prononcer l’emprisonnement pour la période qu’il fixe.

La personne ainsi emprisonnée doit être périodiquement appelée à comparaî-tre pour s’expliquer et l’emprisonne-ment peut être prononcé de nouveau jusqu’à ce qu’elle obéisse En aucun cas, l’emprisonnement ne peut excéder un an. [ 53 ] It should first be noted that articles 50 and 761 of the former Code have been consolidated into a single provision,

article 58 of the new Code , which creates the offence of contempt of court. [47] [ 54 ] Moreover, there is now a single provision dealing with the consequences of civil contempt, namely,

article 62 of the new Code , which consolidates

article 51 and part of

article 761 of the former Code .

Article 62 of the new Code alters the prior law in several respects. [ 55 ] All of the consequences for civil contempt of court are grouped together under one heading, with the “only [two] sanctions” that may be imposed “for contempt of court” being either: (1) a “punitive” fine not exceeding $10,000 for a natural person and $100,000 for a legal person, or (2) the performance of compensatory community work “the nature, terms and duration of which are determined by the court”. [ 56 ] The wording of

article 62 of the new Code settles the debate on whether it is possible to impose sanctions other than a fine or imprisonment for contempt of court. Henceforth, the only possible sanctions are the payment of a fine and the performance of compensatory community work. [48] [ 57 ] The consolidation under

article 62 of the new Code eliminates the problem of classifying the form of civil contempt of court under

article 51 or under

article 761 of the former Code . All the consequences of civil contempt must now be assessed in light of

article 62 of the new Code .

[ 58 ] The sanctions under

article 62 of the new Code now apply to all cases of civil contempt of court, be it a person who disobeys a court order or injunction, who acts in such a way as to interfere with the orderly administration of justice or who acts in such a way as to undermine the authority or dignity of the court. [ 59 ] The only sanction that may be imposed on a person convicted of contempt of court, regardless of the nature of the contempt, is a fine, compensatory community work or a combination of the two. [49] [ 60 ] The principles and objectives arising from criminal and penal law that have been applied to contempt of court, namely, the principle of proportionality and the consideration of objectives such as denunciation, deterrence, reparation and the promotion of a sense of responsibility in the contemnor, will continue to apply to the “sanctions”, that is, pecuniary sentences and compensatory community work, for all types of contempt of court.

In this regard, the principles established under the former Code remain applicable. [ 61 ] In the specific case where the person refuses to comply with “the court order or injunction”, pursuant to the last paragraph of

article 62 of the new Code , “in addition to the sanction imposed [i.e., a fine and/or compensatory community work], the court may order imprisonment”. [ 62 ] The legislature has therefore ruled out imprisonment as a punitive sanction for civil contempt of court for the breach of a court order or injunction. As indicated, from now on, there are only two possible sanctions, a fine and the imposition of compensatory community work. These are the “only sanctions” available to punish contempt of court.

Imprisonment is not included. [50] [ 63 ] Imprisonment for civil contempt is now a civil measure for the enforcement of orders and injunctions. The coercive mechanism provided for in the second paragraph of

article 62 of the new Code confirms it. [ 64 ] Indeed, the person so imprisoned “ must be summoned before the court periodically to explain themselves, and imprisonment may be ordered again until the person complies”.

Within the perspective of coercion, if the person complies with the order or injunction, the imprisonment must cease. [ 65 ] This is nothing new, because it was previously acknowledged that the imprisonment had to cease if, after giving the matter some thought, the person having infringed, refused to obey or contravened an order or injunction chose to comply. [51] Indeed, under articles 51 and 761 of the former Code , the prison sentence imposed for contempt continued to apply until the person obeyed or complied with the order.

From this point of view, imprisonment for contempt had a coercive purpose, which is now set forth in

article 62 of the new Code . [ 66 ] When imprisonment is imposed under

article 62 of the new Code , the term of imprisonment cannot exceed one year. The theoretical possibility, under the former Code , that a person could have new, potentially unlimited, terms of imprisonment imposed on them if they continued to disobey an injunction is a concern that was raised in the legislative debates specifically addressing

article 62. [52] [ 67 ] Indeed, according to one learned author, [ translation ] “the text of articles 51 and 761 [of the former Code ] was not as clear and could be construed as allowing the one-year period to be exceeded, until the imprisoned person complied with the order or injunction”. [53]

Article 62 of the new Code addresses that concern by declaring that “[i]mprisonment can in no case exceed one year”. [ 68 ] The court can therefore impose an initial term of imprisonment with a specific duration.

When the contemnor is called to appear in court, periodically, and still does not comply with the order or injunction, the court can impose a new term of imprisonment and so on, until the contemnor complies. [ 69 ] Under no circumstances, however, can the cumulative term of imprisonment exceed one year. [ 70 ] Although imprisonment for civil contempt in Quebec no longer has a punitive purpose, a blatant breach of an order or of the authority of a court could potentially justify a charge of criminal contempt.

In matters of criminal contempt, the Crown must prove, beyond a reasonable doubt, “that the accused defied or disobeyed a court order in a public way (the actus reus ), with intent, knowledge or recklessness as to the fact that the public disobedience will tend to depreciate the authority of the court (the mens rea ). [54] [ 71 ] Thus, criminal contempt of court involves additional egregiousness, that is, an element of public defiance of the court’s order or process in a way calculated to lessen societal respect for the courts. [55] Criminal contempt therefore has a punitive and deterrent purpose [56] and forms part of the arsenal of sanctions available in criminal law for the most serious cases of contempt. [ 72 ] What are the applicable criteria for imposing a sentence of coercive imprisonment for civil contempt?

Coercion does not have the same objective and should not have the same consequences as punishment. Consequently, without completely setting aside considerations stemming from criminal and penal law, the applicable criteria for imposing coercive imprisonment for civil contempt must be redefined. [ 73 ] In my opinion, the main criteria for issuing a coercive order of imprisonment for civil contempt are necessity and proportionality. [57] [ 74 ] Imprisonment deprives individuals of their liberty.

Before imposing imprisonment to compel the performance of an order or injunction, the court must ask itself whether such a measure is necessary and whether there are other measures by which the sought-after objective could be achieved, [58] be it a fine or an order to perform compensatory community work. [59] Imprisonment for civil contempt should be an exceptional measure used as a last resort. [60] [ 75 ] The need for coercive imprisonment could result from the contemnor’s conduct, such as a flagrant disregard for the authority of the courts. [61] Moreover, the fact that this is not the contemnor’s first conviction for contempt, particularly in the same case or in a related case, could demonstrate the need for more radical measures to compel the contemnor to comply with court orders.

[ 76 ] If the court is of the view that imprisonment is required to compel the performance of an order or injunction, the term of the imprisonment, as well as the additional periods of imprisonment that may be imposed, if applicable, should be proportional to the gravity of the contemnor’s actions and the consequences of his or her refusal to comply, particularly the effects on the repute of the administration of justice.

In this regard, the court may consider the contemnor’s situation and the impact that coercive imprisonment could have on the contemnor and his or her family. [ 77 ] In any event, the term of the coercive imprisonment should not exceed what is reasonable to achieve the fundamental objective sought, which is compliance with the order or injunction [62] . Application to the facts of the case AMF File [ 78 ] The appellant argues that imprisonment can only be imposed if the contemnor refuses to comply with a sanction, that is, a fine or the performance of compensatory community work.

In the present case, the judge imposed both a fine and imprisonment. The appellant was not in breach of the pecuniary order and therefore could not be subject to imprisonment. [ 79 ] The appellant is mistaken. Indeed, the last paragraph of

article 62 of the new Code provides that, where a person refuses to comply with an order or injunction, “ in addition to the sanction imposed , the court may order imprisonment” [emphasis added]. [ 80 ] Moreover, as the first paragraph of

article 62 of the new Code indicates, the judgment imposing a fine as a punitive measure for contempt of court includes its own mechanism, because it “is executed in accordance with

Chapter XIII of the Code of Penal Procedure “. [ 81 ]

Chapter XIII of the Code of Penal Procedure [63] contains a set of measures for the execution of monetary orders in penal matters, including mechanisms for the recovery of sums, seizures, the possibility of ordering compensatory work and, potentially and as a last resort, imprisonment for the failure to comply with the orders made. Where imprisonment is ordered, its total term cannot exceed two years less one day. [64] [ 82 ] The appellant argues that the purpose of the imprisonment imposed by the judge was punitive, not coercive.

Since his faulty conduct had ended at the time sentence was imposed, imprisonment was unavailable. The appellant therefore submits that the judge should have considered compensatory community work instead of imprisonment. [ 83 ] In the present case, it is true that the imprisonment seems to have been imposed primarily to punish, in order to take action against the appellant’s conduct.

Indeed, the two months of imprisonment ordered by the judge were intended to make the appellant [ translation ] “realize the gravity of his actions and activities”. [65] [ 84 ] Punishment as an objective for contempt of court is to be used to determine the sanctions, [66] namely, either a fine or compensatory community work. Under the new Code , imprisonment is designed to compel, not to punish.

In this regard, and with all due respect, the judge erred. [ 85 ] Notwithstanding this error, I am of the view that coercive imprisonment of two months could have been imposed to compel the appellant to comply with the orders made by the FMAT on July 20, 2017, given that the appellant systematically and intentionally continued to breach them. The following excerpts from the judgment under appeal speak volumes: [ translation ] [42] The Court read all of Dominic Lacroix’s communications found on the laptop of DL lnnov’s employee, Yan Ouellet.

The Court is of the opinion that the excerpts it has reproduced demonstrate the defendants’ flippancy towards the orders made and their intention not to comply therewith. [43] The defendants continued to carry on their activities as if the Financial Markets Administrative Tribunal had not ordered them to cease any activity in furtherance of a transaction in any form of investment, including the making of representations and the solicitation of investors within Quebec or outside Quebec from within Quebec, whether directly or indirectly.

The testimony of investigator Hamelin shows that the defendants continued their solicitation activities on the Internet, on Facebook and otherwise in connection with securities and other forms of investments, directly and indirectly.

The defendants failed to shut down the websites www.plexcorps.com and www.plexcoin.com or make them inaccessible to any IP address in Quebec, whether directly or indirectly. [44] The defendants’ attitude, as demonstrated by the testimony of investigator Hamelin and particularly by the conversations of Dominic Lacroix with his employee Yan Ouellet at DL lnnov, indicate that all efforts are being made to implement and continue the activities they have been ordered to cease, directly and indirectly. [46] It is easy to see that the defendants’ intention is to wilfully and knowingly pursue their activities, contrary to the orders made. [48] The defendants fully understood the orders made, but they intentionally and wilfully disregarded them.

The allure of making a profit to the detriment of investors who were promised disproportionate interest rates was the defendants’ only goal, notwithstanding the decision rendered: […] [67] [ 86 ] The appellant alleges that at the time of the sentencing judgment, his faulty conduct had ceased and the websites of PlexCorps and PlexCoin were no longer accessible with an IP address in Quebec. The judge, however, indicated the following: [ translation ] [35] Inspector Hamelin acknowledges that, since September 29, 2017, the website of PlexCorps and PlexCoin is no longer accessible

with an IP address in Quebec. He added, however, that the website can be accessed indirectly through a phantom station, as he did on October 4, 2017, or through an external address , such as an IP address in Japan, France or elsewhere. [68] [Emphasis added.] [ 87 ] The third order made on July 20, 2017 ordered the appellant to shut down the websites in question or, failing same, to make them inaccessible to any IP address in Quebec so as to prevent any person residing in Quebec from consulting them .

The order was clearly intended to ensure that the appellant would take the necessary measures to prevent any person residing in Quebec from consulting the websites pertaining to the plexcoins. [ 88 ] The appellant had not complied with this order at the time the judgment was rendered.

In fact, according to the testimony of inspector Hamelin, the websites www.plexcorps.com and www.plexcoin.com were still operating and it was still possible for a person residing in Quebec to access them through roundabout means. [ 89 ] Moreover, the “Telegram” platform, which provided information about the company PlexCoin and its activities, was still active on or about November 2, 2017 when inspector Hamelin connected to it from an IP address in Quebec.

This was an ongoing breach of the orders made on July 20, 2017. [ 90 ] The judge therefore noted that the orders made by the FMAT on July 20, 2017 were being systematically breached by the appellant, who chose not to explain himself. There was no evidence that the appellant had complied with the orders. [ 91 ] Under these circumstances, the judge could therefore have ordered imprisonment, as a coercive measure, so as to ensure compliance with the orders. [ 92 ] It should be noted that the FMAT issued its orders for compelling reasons, so as to protect the public interest. The appellant’s activities were illegal.

Numerous small investors had purchased plexcoins based on a promise of staggering and completely unrealistic potential returns of approximately 1,354%. [69] [ 93 ] The judge noted that since the moment the FMAT had made its orders on July 20, 2017, [ translation ] “the contributions received through the continued activities of the defendants [which includes the appellant] had raised several million dollars, even exceeding ten million dollars”. [70] [ 94 ] Coercive imprisonment of two months is not disproportionate given the seriousness of the appellant’s actions, the threat he represents to the public and his flagrant and persistent disregard for the authority of the courts. [ 95 ] The appellant’s deleterious conduct is intentional.

The judge wrote that [ translation ] “this is an extreme case of serious disobedience and bad faith”. [71] [ 96 ] Therefore, coercive imprisonment could be combined with the punitive measure, that is, the $10,000 fine. [ 97 ] The judge’s conclusions regarding the imprisonment, however, do not provide a mechanism for the appellant to return to Court periodically so he can explain himself and eventually have the measure lifted.

He therefore erred in law on this point and the order should be corrected accordingly. [ 98 ] I would therefore allow the appeal for the sole purpose of reformulating the conclusions in paragraphs 63, 64 and 65 of the judgment as follows, adding conclusion 65.1: [63] IMPOSES a term of imprisonment of two (2) months on the defendant Dominic Lacroix, to be served in a detention centre; [64] ORDERS the administrator of the detention centre to admit and hold the defendant Dominic Lacroix; [65] DIRECTS law enforcement officers and any bailiff of this Court to apprehend the defendant Dominic Lacroix, to bring him safely to the Centre de détention de Québec and to deliver him to the administrator of the Centre de détention de Québec so that the sentence of imprisonment can be carried out; [65.1] ORDERS the defendant Dominic Lacroix to appear before the Court on the fifteenth day following the date of this judgment, and at such intervals as the Court may subsequently determine, it being understood that he may, at any time, request that the Court hold a hearing so that he can explain that he has complied with the orders or intends to comply therewith on a specific date; RCAP File [ 99 ] The appellant argues that imprisonment under

article 62 of the new Code is not a punishment, but rather a coercive measure. The judge, in fact, sought to punish the appellant. Indeed, he used words such as [ translation ] “penalty” and [ translation ] “sentence” when imposing the imprisonment, confirming his intention to impose a sanction. With a punitive purpose in mind, the judge could not order both compensatory community work and imprisonment, because this would subject the appellant to a double sanction. [ 100 ] The appellant is mistaken.

Notwithstanding the words the judge used, it is clear from the judgment that he resorted to imprisonment in order to compel the appellant to comply with the orders in question in this case, orders that enjoined him to (1) provide a sworn statement of his assets and liabilities; (2) prepare a full rendering of accounts regarding any cryptocurrency; and (3) provide the passwords and usernames giving access to certain devices and equipment that had been seized. [ 101 ] Indeed, the imprisonment was imposed because the appellant refused [ translation ] “to fully and properly comply with the orders”. [72] In fact, the judge’s conclusion provides that the term of imprisonment [ translation ] “may be reassessed by the Court if the defendant agrees to comply with the orders to the Court’s satisfaction and acts accordingly”. [73] [ 102 ] The use of the terms [ translation ] “penalty” and [ translation ] “sentence” therefore does not reveal an intention to punish.

The

judge properly understood the distinction between the punitive and coercive measures under

article 62 of the new Code : [ translation ] [46] As a result, there are, at first sight, two possible sentences. Either a fine, or the performance of compensatory community work, formerly referred to as community service. [47] As for imprisonment, it is possible only if the contemnor still refuses to obey the order in respect of which he was convicted. In such a case, the sentences cannot exceed one year and must cease when the person complies with the order.

It is up to the person to obey the order if he wishes to avoid prison. [74] [ 103 ] The judge imposed imprisonment of two months for each of the three orders the appellant refused to obey, to be served [ translation ] “consecutively” (two months per count)”. [75] On this point, as the appellant argues, the judge erred by imposing consecutive prison terms. [ 104 ] The notion of consecutive imprisonment is imported from criminal and penal law.

Section 718.3(4) of the Criminal Code provides that the court may consider imposing consecutive sentences under certain circumstances, such as when the offences do not arise out of the same event or series of events. [ 105 ] In the case of multiple offences that do not arise from the same event or series of events, the court must use the following approach: determine the sentence for each offence, decide whether the sentences should be concurrent or consecutive and, in the latter case, determine whether the overall sentence violates the principles of totality and proportionality. [76] [ 106 ] This analysis grid, which is particular to criminal and penal law, cannot apply when a court is considering coercive imprisonment to compel the performance of an order or injunction in a civil matter. [ 107 ] As

article 62 of the new Code indicates, a person who has been imprisoned for contempt for refusing to comply with an order or injunction must be called periodically before the court to explain themselves. If the person complies to the satisfaction of the court, they must be released. [ 108 ] In my opinion, when there are multiple violations being dealt with simultaneously, each term of imprisonment must be considered in isolation.

For each violation, the imprisonment must be determined in order to achieve the objective, which is compliance with the order or injunction. [ 109 ] If the offender chooses to obey one order, but not another, the imprisonment for the former order will end, but not that for the latter order. The consecutive nature of imprisonment cannot apply in such a context. [ 110 ] The appellant argues that the imprisonment imposed by the judge is unlawful because it does not provide a date for the appellant’s return to court.

Indeed, the judge indicates that the measures may be reassessed if the appellant agrees to comply with the orders and that it [ translation ] “will be up to him to notify the Court through his counsel so that a hearing to that effect can be held”. [77] [ 111 ] The last paragraph of

article 62 of the new Code states that the “ person so imprisoned must be summoned before the court periodically to explain themselves” [emphasis added]. [ 112 ] A number of specific cases are possible. [ 113 ] The court could impose an initial short term of imprisonment and provide in its order that the person be brought back before the court upon the expiry of that term so they can explain themselves and, if the person does not comply, the court could impose a new term of imprisonment and so on. [ 114 ] The court could also provide for a longer term of imprisonment and order that the person be brought back before the court periodically during that term to have an opportunity to explain themselves.

In this regard, the court could provide for the return to court of the contemnor at fixed and predetermined intervals (such as every 30 days) or it could establish the date on which the contemnor is to be brought back as and when he appears in court. [ 115 ] In all cases, the imprisoned person “must be summoned before the court periodically to explain themselves”.

This allows the court to maintain control over the coercive mechanism and ensure that the imprisonment genuinely satisfies its primary objective, which is to compel the person in question to comply with the order or injunction. [ 116 ] There is nothing preventing the contemnor, on his own initiative, from asking to go before the court before the scheduled date if he wishes to explain himself.

In this sense, the contemnor always holds the key to his own cell [78] in that he can go before the court at any time to explain himself and eventually have the term of imprisonment lifted if he shows that he has complied with the injunction or order in question or that he intends to do so. [ 117 ] In the pres ent case, the judge imposed a term of imprisonment of two months per offence, but did not provide a date for the contemnor’s return to court.

He therefore erred in law and the order should be corrected accordingly. [ 118 ] The appellant also argues that, since the judge did not find him to be credible when he alleged that he was no longer in a position to comply with the orders, he will never be able to be released. This circular argument must be rejected. [ 119 ] The judge determined that the appellant could still comply with the orders, but intentionally refused to do so. As regards the contemnor providing a statement and a rendering of accounts, the judge wrote: [ translation ]

[71] Given these elements and the defendant’s lack of credibility in the eyes of the Court, the Court is convinced that the defendantknows more than he intimated. He is playing a game of chicken and, to this day, refuses to fully and properly comply with the Court’sorders regarding the statement and the rendering of accounts. [72] Admittedly, the exercise may be difficult and may not result in everything balancing perfectly. The Court understands this and willconsider it.

Currently, however, there are variances and discrepancies and an unacceptable lack of explanations regarding what wascollected within the scope of the plexcoin project. [73] The Court, like RCAP and the general public, cannot be satisfied with the meagre information obtained to date. To conclude as suchis neither reasonable nor appropriate. This would amount to capitulating to someone who has deceived society and continues to do so.

Aperson who flouts court orders.[79] [120] With respect to the usernames and passwords, the judge stated: [translation] [75] As regards the codes, usernames and passwords, the Court reiterates what it wrote in its decision dated July 12, 2019. It does notbelieve the defendant any more today than it did then. [76] The Court is convinced that he possesses and can provide the information required to access the computerized content.

To suggestotherwise would be an aberration.[80] [121] The appellant does not have many options: if he complies, the Court will be able to order his release. [122] Lastly, the judge was entitled to combine compensatory community work, a punitive measure, with imprisonment for coercivepurposes. The last paragraph of

article 62 of the new Code expressly permits it. [123] Faced with the appellant’s flippancy and flagrant disregard for the authority of the courts, these measures were fully justified. [124] I would therefore allow the appeal for the sole purpose of reformulating the conclusions in paragraphs 82 and 83 of thejudgment, while adding conclusions 83.1 and 83.2: [82] IMPOSES a term of imprisonment of two (2) months for each count on the defendant Dominic Lacroix, to be served in a detentioncentre; [83] ORDERS the administrator of the detention centre to admit and hold the defendant Dominic Lacroix; [83.1] DIRECTS law enforcement officers and any bailiff of this Court to apprehend the defendant Dominic Lacroix, to bring him safelyto the Centre de détention de Québec and to deliver him to the administrator of the Centre de détention de Québec so that the sentence ofimprisonment can be carried out; [83.2] ORDERS the defendant Dominic Lacroix to appear before the Court on the fifteenth day following the date of this judgment, andat such intervals as the Court may subsequently determine, it being understood that he may, at any time, request that the Court hold ahearing so that he can explain that he has complied with the orders or intends to comply therewith on a specific date; SIMON RUEL, J.A. [27] Morasse v.

Nadeau-Dubois, 2016 SCC 44, paras. 19 and 21; Carey v. Laiken,2015 SCC 17, para. 36; Constructions Louisbourg ltée c. Société Radio-Canada, 2014QCCA 155, para. 26, leave to appeal to the Supreme Court refused, June 26, 2014,No. 35797; Centre commercial Les Rivières ltée v. Jean bleu inc., 2012 QCCA 1663,paras. 7, 45 and 64. [55] Carey v. Laiken, 2015 SCC 17, para. 31; United Nurses of Alberta v. Alberta(Attorney General), (SCC), [1992] 1 S.C.R. 901, p. 931; Poje v.Attorney General for British Columbia, (SCC), [1953] 1 S.C.R. 516,p. 522. [63] Code of Penal Procedure, CQLR, c. C-25.1.

[76] R. c. Guerrero Silva , 2015 QCCA 1334 , para. 55 .