Case information

Civil liability — Liability for personal act or omission — Loan of money — Fraudulent transaction — Intermediary — Guideposts structuring power of courts, in matters of extracontractual civil liability in Quebec, to derive rules of conduct based on circumstances of each case — Whether Yohan Murray departed from rule of conduct within meaning of art. 1457 C.C.Q. — Whether Mr. Murray’s conduct could be cause of Usiroyal inc.’s contractual misadventures — Whether courts below should have ruled on abuse of procedure by Usiroyal inc. and Jacques Poulin — Civil Code of Québec, art. 1457.

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The respondent Jacques Poulin is the sole shareholder of the respondent Usiroyal inc. In 2016, the applicant, Yohan Murray, introduced Denis Goulet, Guy Dufresne and Chantal Gaudreault to Mr. Poulin as potential purchasers of a company related to Usiroyal. Reassured by the advice of Mr. Murray, who considered Mr. Goulet and Mr. Dufresne to be trustworthy, Mr. Poulin signed, on behalf of Usiroyal, a loan agreement between Usiroyal and 9608478 Canada inc. (Alfi Capital), a company registered in 2016 whose shareholders were Mr. Goulet, Mr. Dufresne and Ms. Gaudreault. The agreement provided that the $250,000 being loaned was to be used for the purchase of a financial instrument to be issued by a bank. The transaction was protected by, among other things, the personal suretyship of Mr. Goulet and Mr. Dufresne and a letter of suretyship provided by Victor Gatto, the president of GDG Venture Capital LLC. It turned out that Mr. Poulin and Usiroyal were the victims of a scam and were never to see the loaned money again. Usiroyal therefore filed a judicial application seeking a solidary award for the sum of $250,000. Mr. Murray filed a cross-application seeking reimbursement of his extrajudicial fees, as he considered the action abusive.

The Superior Court allowed the amended originating application and ordered 9608478 Canada inc., Mr. Goulet, Mr. Dufresne, Ms. Gaudreault, GDG Venture Capital LLC and Mr. Murray solidarily to pay $250,000 to Usiroyal inc. It dismissed Mr. Murray’s cross-application, finding that his participation in the fraudulent scheme had been definite and intentional and that the transaction would not have occurred without his involvement. The Court of Appeal dismissed Mr. Murray’s appeal. No palpable and overriding error had been shown in the judge’s factual inferences and findings with regard to the extracontractual fault committed by Mr. Murray.