In a decision rendered by the Court of Quebec (still unpublished as of this writing) on January 22, 2021 in 9174-0886 Québec inc. c. Rochette, RSS successfully presented a motion alleging abuse of proceedings in a related case dismissed at the preliminary stage, by arguing the application of res judicata.
The facts
In 2014, Plaintiff 9174-0886 Québec inc. [Globe] instituted legal proceedings in payment for services rendered to 9184-2518 Québec inc. [Rocand] for the development of a computer system.
Initially a simple action on account, the case was quickly complicated by a counterclaim, a few hundred exhibits, expert opinions and a 10-day trial. Thus, in 2016, Globe filed a claim alleging abuse of proceedings against Rocand, claiming an amount of $20,000 in extrajudicial fees, to be specified at the hearing. During the trial, Globe submitted invoices totaling in excess of $70,000 in legal fees.
In June 2019, Justice Langis rendered a final judgment, in which she ordered Rocand to pay for the services rendered, as well as the extrajudicial fees of $20,000 that were claimed. In particular, she concluded that the theory of cause developed by Rocand was unfounded, that it improperly pursued a judicial debate based on false premises, and that it acted recklessly in the proceedings: 9174-0886 Québec inc. (Globe Technologies) c. 9184-2518 Québec inc. (Rocand), 2019 QCCQ 3603.
However, in September 2019, even though it had won its case, Globe brought a new action for abuse of proceedings, this time against André Rochette [Rochette], Rocand’s main officer, and its external financial controller, Richard Lebrasseur [Lebrasseur], claiming the remainder of the fees incurred in the action on account. According to Globe, both individual defendants were responsible for Rocand’s wrongful act, and as such, they would be indebted to Globe for the damages sustained in the first action.
It is in this context that RSS, mandated to defend the professional liability of Lebrasseur, filed a motion for dismissal raising, amongst other points, that the judgment of Justice Langis had the authority of res judicata. In analyzing the criteria set out in article 2848 of the Civil Code of Québec — identity of object, cause and parties — and the teachings of the Court of Appeal in Ungava Mineral Exploration inc. c. Mullan, 2008 QCCA 1354, the Court of Québec came to the conclusion that Globe’s application had to be dismissed.
Identity of object
With respect to the identity of object, the Court recognizes that in principle, the actions are distinct. Indeed, the one introduced in the first case was an application in the course of a claim for abuse of proceedings, whereas the second action is a matter of extra-contractual liability.
However, despite these different legal grounds, the fact remains that the conclusion sought is the same: compensation for extrajudicial fees incurred in the first action. There is therefore identity of object.
Identity of cause
As to the identity of the cause of action, Justice Vaillant, citing the Ungava case, recalled that it is the “legal or material fact which constitutes the direct and immediate basis of the right claimed” [free translation, para. 35].
In analyzing the statement of claim, she noted that the grounds were based on the same findings and conclusions previously raised by Justice Langis. In the previous legal proceedings, Rocand, a legal person, acted exclusively through Rochette and Lebrasseur. As in Ungava, it is their conduct that is at the heart of the litigation, notwithstanding the fact that it is their personal liability or that of Rocand that is being sought. Thus, there is identity of cause between the two actions.
Identity of parties
At first glance, one might assume that the criterion of the identity of parties is not met, considering that the first recourse was directed at a corporation, while the second recourse is directed at individuals with a distinct personality. However, Justice Vaillant recalls the teachings of the Supreme Court of Canada in Roberge v. Bolduc, 1991 CanLII 83 (SCC), [1991] 1 SCR 374, according to which it is not so much the physical identity of the parties that is sought, but their legal identity, which includes representation. This principle is interpreted broadly in the case law.
As in Ungava, the breaches alleged by Globe were committed while Rochette and Lebrasseur were in the performance of their duties for Rocand. It is on the basis of their conduct as representatives and agents of Rocand that Justice Langis held the corporation responsible for abuse of proceedings. Thus, both cases directly concern their conduct in relation to the theory of cause put forward in the first action.
Conclusion
The three conditions having been met, Justice Vaillant therefore concludes that there is res judicata between the two actions. She notes that the principle of res judicata protects acquired rights and avoids the inconveniences that can result from multiple suits between the same persons. Thus, the Court grants the motion and dismisses the claim instituted against Rochette and Lebrasseur.
This decision is a good illustration that in certain circumstances, there can be res judicata, even when the action is based on different legal grounds and targets parties that are, at first glance, legally distinct. Nevertheless, each situation remains dependent on its own facts.
Appeal
This decision is dated January 22, 2021. The plaintiff, whose case had been dismissed, has filed an appeal.
On April 13, 2022, the Court of Appeal affirmed the decision of the trial court, maintaing the position defended by RSS.