Kechichian v. Paradis, 2021 ONSC 1009

Court File and Parties

COURT FILE NO.: CV-19-82304 DATE: 20210208 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: ANTRANIK KECHICHIAN, Plaintiff AND: LUC PARADIS, JULIEN SIROIS, ALI ARGUN, STEPHANE LAFOREST and MARC-ANDRÉ RUSSELL, Defendants

BEFORE: Mew J.

COUNSEL: Antranik Kechichian, unrepresented Gary G. Boyd, for the defendants

HEARD: 28 October 2020, in Ottawa (by Zoom)

Endorsement

[1] The defendants bring a motion for summary judgment dismissing the plaintiff’s claim against them on the basis that there is no genuine issue requiring a trial because, inter alia, (i) the allegations made against the defendants are unsupported by any evidence; (ii) the action constitutes an impermissible collateral attack on certain decisions of the Québec Superior Court; and (iii) the claims are statute-barred.

[2] The defendants are lawyers, who, at all material times, were practising with Morency Sociéte d'Avocats s.e.n.c.r.l., ("Morency"), a law firm in Québec City. The Morency firm represented Gestion Éric Savard and its affiliated companies (the “Savard companies”) in a proceeding under the Companies Creditors Arrangement Act ("CCAA"), which subsequently became a proceeding under the Bankruptcy and Insolvency Act ("BIA").

[3] The Savard companies declared bankruptcy in December 2016. This was just three months after a group of companies in which the plaintiff was involved had sold the tangible and intangible assets of a business known as Laurier Optical to the Savard group.

[4] A helpful summary of the background is provided by Corthorn J. in her decision of 2 April 2020 in 10313033 Canada Inc. v. Kechichian, 2020 ONSC 1990, and I make no apology for repeating it here:

[5] “Laurier Optical” is known to the public as a chain of optometry clinics and eye dispensing stores in Ontario and Quebec. The ownership of the Laurier Optical franchise system, including the assets of Laurier Optical, changed hands twice in the previous decade. 103 Canada is the current owner and operator of that franchise system.

[6] In 2016, the Kechichian Group sold all of the tangible and intangible assets of Laurier Optical (“2016 Sale”) to the Savard Group.

[7] The terms of the 2016 Sale included: a purchase price of $18M, with $5.5M paid in cash on closing; that the Savard Group would assume the long-term debts of the franchise system; the Kechichian Group would receive a specified percentage of the Class D shares in one of the Savard Group corporations; and the Savard Group would pay the balance of the purchase price in equal monthly instalments over five years.

[9] In May 2017, a number of companies owned or controlled by Savard, including the Savard Group, commenced CCAA proceedings in the Quebec Superior Court of Justice. In those proceedings, the Kechichian Group were unsecured creditors of the Savard Group.

[10] During the CCAA proceedings, Raymond Chabot Grant Thornton LLP (“RCGT”) was judicially appointed as the monitor of the business affairs of the Savard Group (“Monitor”). In the CCAA proceedings, 103 Canada purchased, from the Monitor, both the Ontario Assets and Quebec Assets of Laurier Optical (“the Assets”). The terms of both asset purchase agreements (“Ontario APA” and “Quebec APA”) were approved and authorized by vesting orders obtained by the Monitor from the Quebec Superior Court of Justice (“the Vesting Orders”).

[5] By way of further background, the plaintiff asserts that the purchase of Laurier Optical and the subsequent bankruptcy of the Savard group was orchestrated by Essilor International S.A. (“Essilor”). According to the plaintiff, Essilor then re-purchased Laurier Optical for ten cents on the dollar, thereby defeating the claims of secured creditors, including the plaintiff.

[6] The allegations made against the defendants, who had no lawyer-client relationship with the plaintiff or any other member of the Kechichian Group, are essentially that the bankruptcy was fraudulent and that the Morency lawyers aided in misleading the court. The plaintiff further alleges that his phones and emails were illegally hacked, and that the defendants were responsible for this hacking.

[7] In the course of his submissions on this motion, Mr. Kechichian said that he did not know what Morency had done until he got his file from his former lawyers. Yet it is clear that he attended every hearing that was held concerning the CCAA and BIA proceedings, and was aware what was being said and what was being put before the court.

[8] On 18 May 2017, the Québec Superior Court heard an application by the Savard Companies, represented by Morency, seeking protection under the CCAA. The same day, an order was made granting protection to the Savard Companies.

[9] An order approving the sale of assets of the Savard Group was made by the Québec Superior Court on 31 August 2017. The order was final and has not been overturned on appeal. The plaintiff knew assets were being removed as early as 26 May 2017.

[10] The plaintiff has made similar allegations of fraudulent orchestration of the CCAA (CCRA defendants against other parties, such as RCGT, in other proceedings. Corthorn J. has already held that such allegations amounted to a collateral attack on the Vesting Orders: 2020 ONSC 1990, at para. 48. A collateral attack is “an attack made in proceedings other than those whose specific object is the reversal, variation or nullification of the order or judgment.”: Wilson v. The Queen, [1983] 2 S.C.R. 594 at 599.

[11] As the defendants have stated in their factum, the orders of the Québec Superior Court already dealt with the distribution of assets which the plaintiff claims were stolen and seeks compensation. These orders were final and have not been overturned on appeal. As such, the plaintiff’s claim constitutes a collateral attack on the Québec orders.

[12] Furthermore, when he was cross-examined on the affidavit sworn by him in response to this motion, the plaintiff conceded that he has no evidence that Morency acted beyond the scope of its client’s instructions and cannot specify who he believes was responsible for any of the allegations he makes. His claims that the defendants participated in a conspiracy with their client cannot succeed in the absence of evidence that they acted beyond their role as lawyers.

[13] In fact, the plaintiff has not provided any evidence to support any wrongdoing on the part of Morency. As explained by Corbett J. in Sweda Farms v. Egg Farmers of Ontario, 2014 ONSC 1200, at para. 20:

When I conclude that “there is no evidence” to support essential elements of Sweda’s claims, I must register an important qualification. Sweda’s claims are supported by speculation, argument presented as evidence, unparticularized assertions, and vague references to isolated pieces of evidence. What is absent is a rigourous analysis and presentation that places the isolated pieces of evidence into a coherent context. And the few pieces of hard evidence do not knit into a coherent claim.

Those comments are apposite in the present case too.

[14] The plaintiff claims that his emails were hacked on 13 April 2017.

[15] The plaintiff’s motion record discloses draft correspondence, prepared by his administrative assistant, Shehma Shaikh, dated 2 May 2017, in which reference is made to the hacking of his emails and unauthorised access to other personal information.

[16] This action was commenced on 17 December 2019, well over two years after the Vesting Orders and the alleged hacking were known to the plaintiff.

[17] The limitation period applicable to all of the plaintiffs’ claims is two years from the day that the claim was discovered: Limitations Act, 2002, S.O. 2002, c 24, Sch B, s. 4. There is a rebuttable presumption that time runs from the date on which the act or omission on which the claim is based took place: s. 5(2).

[18] The record shows that the acts or omissions on which the plaintiff’s claims are based all took place more than two years before he started his action. He has adduced no evidence to show that he did not discover those claims until some later date.

[19] By reason of the foregoing, the plaintiff’s action fails on the basis that it is statute-barred.

[20] But if I am wrong in coming to that conclusion, the claims of conspiracy and fraudulent conduct also fail on the basis that they are a collateral attack on the Vesting Orders and, further, that they are wholly unsupported by appropriate evidence.

[21] Summary judgment will therefore go in favour of the moving parties dismissing the action against them.

[22] I am presumptively of the view that the moving parties are entitled to their costs of the motion and the action on a partial indemnity basis.

[23] As this is one of six summary judgment motions involving the plaintiff which were heard consecutively, I will give direction separately with respect to the delivery of costs summaries and submissions on the issue of costs in both this and the other summary judgment motions which I heard at the same time.

Mew J. Date: 08 February 2021