Reasons for Decision

Court File No.: CV-24-00733846-00CL
Date: 2025-05-26
Superior Court of Justice – Ontario (Commercial List)

Re: Samer Bishay, Applicant
And: Bank of Montreal, Respondent

Before: Jane Dietrich

Counsel:
James Gardner Hodder III, Yin Fung Liu, for the Applicant
Geoff R. Hall, Aya Schechner, for the Respondent

Heard: 2025-05-16

Introduction

[1] Samer Bishay brings this application seeking an order under the Bank Act (S.C. 1991, c. 46) (the “Bank Act”) compelling Bank of Montreal to reinstate certain of Mr. Bishay's bank accounts. Mr. Bishay also seeks an order directing a trial as to his damages and a Norwich Order requiring the Bank to disclose the nature, content and source of information received by the Bank which led to the Bank's decision to terminate its banking relationship with Mr. Bishay.

[2] The Bank disputes the relief sought.

[3] In essence, this is a dispute about the interpretation of s. 627.17 of the Bank Act. For the reasons below, Mr. Bishay’s application is dismissed.

[4] Terms used and not otherwise defined herein have the meaning provided for in the factum of Mr. Bishay filed on this application.

Background

[5] The relevant facts are not disputed. By letter dated May 28, 2024 (the “Termination Letter”), the Bank provided notice that it was terminating its banking relationship with Mr. Bishay.

[6] The Bank had previously provided a variety of financial products to Mr. Bishay: (a) a chequing account (the “Retail Deposit Account”); (b) two personal credit cards; (c) a mortgage on a personal residence; (d) a home equity line of credit; and (e) a registered products account.

[7] This application is only about the Retail Deposit Account. Mr. Bishay opened the Retail Deposit Account on June 28, 2022, by signing an Everyday Banking Account Opening agreement.

[8] In the Termination Letter, the Bank had given notice that all Mr. Bishay's accounts would be closed as of June 28, 2024. Subsequently, the Bank extended that date until July 31, 2024. The Termination Letter stated that the Bank's “decision is based on information indicating past business or personal activity which does not align with our risk tolerance.”

[9] Mr. Bishay opened certain accounts at another institution and all of his accounts at the Bank are now closed.

[10] Mr. Bishay advises that he is the founder, CEO, and principal shareholder of Iristel Technologies Inc. (“Iristel”). Iristel is currently involved in litigation with the Canada Revenue Agency. The Department of Justice of Canada has alleged that Iristel “intend[ed] to defraud” the government. Iristel denies this allegation and has sued the government.

Issues

[11] There are three issues to be determined:

(a) First, is Mr. Bishay entitled to the reinstatement of his Retail Banking Account under the Bank Act;

(b) Second, if so, should Mr. Bishay’s damages be referred to a trial; and

(c) Third, is Mr. Bishay entitled to the Norwich Order relief sought?

Analysis

Reinstatement of the Retail Banking Account

[12] Mr. Bishay does not dispute that under the common law, banks are entitled to terminate a banking relationship upon providing reasonable notice, without being required to justify their decision: see International Relief Fund for the Afflicted and Needy (Canada) v. Canadian Imperial Bank of Commerce, 2013 ONSC 4612 at para 7.

[13] However, Mr. Bishay relies on s. 627.17(1) of the Bank Act to seek the reinstatement of his Retail Deposit Account.

[14] Section 627.17(1) is contained in Part XII.2 of the Bank Act which is entitled ‘Dealing with Customers and the Public’. Further, it falls under the Division 2 – Fair and Equitable Dealings and the subheading Access to Basic Banking Services. It provides:

Retail Deposit Accounts Opening 627.17 (1) Subject to subsection (2), a member bank shall, at any point of service or any branch in Canada at which it opens retail deposit accounts through natural persons, open a retail deposit account on the request, made there in person, of a natural person who (a) presents to the member bank (i) two documents from a reliable source — one of which indicates the person’s name and address and the other the person’s name and date of birth…(emphasis added)

[15] In brief, that provision provides that the Bank must open a Retail Deposit Account if an individual attends at a specific location and presents certain identification. There are limited statutory exceptions where a Bank can refuse to open Retail Deposit Account, but the parties agree that the exceptions do not apply here.

[16] Rather, the Bank takes the position that the provision only applies to the opening of a Retail Deposit Account, but that once open, the account is governed by contract between the parties and the common law and can be closed based on the applicable contractual terms.

[17] The parties agree that, similar to the common law, based on the contractual terms, the Bank’s closing of the account was permitted and no reasons for the termination of the account need to be provided.

[18] Accordingly, this is a statutory interpretation dispute—does the word ‘open’ used in s. 627.17 of the Bank Act refer only to the initial opening of the account or does it mean that the account is to remain open?

[19] In terms of the principles of statutory interpretation, the words of the Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act and the intention of the Legislature: see Rizzo & Rizzo Shoes Ltd. (Re).

[20] Part XII.2 of the Bank Act includes 25 defined terms (and the Bank Act more generally includes over 100 definitions), none of which are “open”.

[21] Legislative drafters are presumed to use the ordinary meaning of words: see Ruth Sullivan, The Construction of Statutes, 7th ed. (Toronto: LexisNexis, 2022) at s. 3.01[3]. The Bank submits that the ordinary meaning of the verb “open” means to start something, not to continue something indefinitely. For example, the Cambridge Dictionary defines the verb “open” as “to (cause to) begin” and provides the following examples: “I would like to open my talk by giving a brief background to the subject”; “I'm going to open an account with another bank;” and “The Olympic Games open tomorrow.”

[22] Mr. Bishay submits that there are many dictionary definitions of ‘open’ as a verb including from the Merriam-Webster Dictionary “to make available for or active in a regular function” or “to make accessible for a particular purpose”.

[23] Where two possible interpretations are possible, the interpretation that leads to an absurdity should be rejected in favour of a plausible alternative which avoids the absurdity: see Ontario (Attorney General) v. Norwood Estate, 2021 ONCA 493 at para 98. Here, Mr. Bishay submits that the Bank’s interpretation of ‘open’ should be rejected as absurd because he says that it would be absurd to require a bank to open an account only to permit the bank to immediately close it for any reason.

[24] The Bank disagrees that its interpretation leads to any absurdity. Rather, the Bank submits that under the common law, a bank may not immediately close an account for any reason. Rather, a bank is required to provide reasonable notice prior to closing the account. Accordingly, the Bank’s interpretation is not absurd, as an account holder would have access to the bank account for a reasonable period of time it would take to open an account somewhere else.

[25] Both parties agree that s. 627.17 of the Bank Act is classified as a consumer provision under the Financial Consumer Agency of Canada Act. Mr. Bishay submits that because s. 627.17 of the Bank Act is a consumer provision, it is part of a larger legislative intent to protect depositors and its interpretation should align with the consumer protection purpose of ensuring access to basic banking services.

[26] Courts cannot, however, disregard the actual words that have been chosen by Parliament and rewrite the statute in accordance with their own view of how the legislative purpose could be better promoted: see Canada (Information Commissioner) v. Canada (Minister of National Defence), 2011 SCC 25 at para 40.

[27] In Mr. Bishay’s factum, he argued that s. 627.17 of the Bank Act establishes the Bank’s “obligation to open, and by implication to maintain,” a retail deposit account. However, there is no reference to ‘maintain’ in the statute and prior versions of what is now s. 627.17 have been interpreted by Courts to only apply the act of opening an account and not to the process of termination or closing the account.

[28] Although, s. 627.17 was introduced in 2022 by the Budget Implementation Act, 2018, No. 2, S.C. 2018, c. 27, s. 329, a similarly worded provision which was previously contained in s. 448.1 of the Bank Act was repealed by the same Act. The previous s. 448.1 of the Bank Act read:

Retail deposit accounts 448.1 (1) Subject to regulations made under subsection (3), a member bank shall, at any prescribed point of service in Canada or any branch in Canada at which it opens retail deposit accounts through a natural person, open a retail deposit account for an individual who meets the prescribed conditions at his or her request made there in person. (emphasis added)

[29] The conditions that must be satisfied before a bank opens a retail deposit account (now listed in section 627.17), as well as the circumstances in which a bank may refuse to open a retail deposit account (now listed in section 627.18), were previously contained in regulations.

[30] The British Columbia Supreme Court found that these prior regulations were inapplicable to account closure. Specifically, in Lovric v. The Toronto-Dominion Bank, 2008 BCSC 478, the plaintiff alleged a violation of the relevant regulations. However, the Court accepted the defendant’s submission that s. 448.1 of the Bank Act and the relevant regulations pertained to the opening of bank accounts not to the closing of bank accounts which, remained subject to the terms of the agreement between the bank and customer: see Lovric at para 14.

[31] The now repealed s. 448.1 of the Bank Act was introduced in 2001 by the Financial Consumer Agency of Canada Act, S.C. 2001, c. 9, which received Royal Assent on June 14, 2001. Since that time, a number of Courts have reaffirmed a Bank’s common law right to terminate a banking relationship on reasonable notice: see International Relief Fund for the Afflicted and Needy (Canada) v. Canadian Imperial Bank of Commerce, 2013 ONSC 4612 at paras 12 and 13 relying on Venture Capital USA Inc. et al. v. Yorkton Securities Inc., and Toronto-Dominion Bank c. Pourshafiey, 2020 QCCA 1582 at paras 40 and 64.

[32] The state of the law has been summarized as follows:

A bank is not precluded, by the fact of having accepted a customer from seeking to terminate the banking relationship at any time thereafter, even a short time thereafter, unless the account management agreement expressly or impliedly provides to the contrary. On unilateral termination, the bank is obliged at common law to provide notice of a reasonable duration. What is reasonable notice is a matter of fact and may vary in the circumstances…
See Bradley Crawford et al., Law of Banking and Payment in Canada (Toronto: Carswell, 2011) at s. 9:166

[33] The state of the common law is important because it is presumed that legislatures do not intend to change existing common law rules in the absence of clear provisions to that effect: see Lizotte v. Aviva Insurance Company of Canada, 2016 SCC 52 at para 56. As the Supreme Court of Canada explained in R. v. Basque, 2023 SCC 18 at para 40: “Professor Ruth Sullivan has written that this presumption ‘permits courts to insist on precise and explicit direction from the legislature before accepting any change. The common law is thus shielded from unclear or inadvertent legislative encroachment’ (The Construction of Statutes (7th ed. 2022), at § 17.01).” In oral submissions, Mr. Bishay argued that this principle does not apply to the Bank Act because the Bank Act is in effect the ‘charter’ of the Bank. I do not agree. A bank is governed by the common law and statute and accordingly this principle of statutory interpretation applies.

[34] In the present circumstances, I am not persuaded that use of the word ‘open’ amounts to the ‘precise and explicit direction from the legislature’ needed to amend the common law. Rather, it is no different than the use of the word ‘open’ in the previously repealed section which was not interpreted as ‘open and maintain’ or ‘keep open’ as suggested by Mr. Bishay.

[35] Accordingly, I agree with the interpretation put forward by the Bank and find that the Bank’s actions in terminating Mr. Bishay’s Retail Deposit Account do not violate s. 627.17 of the Bank Act.

Mr. Bishay’s Damages

[36] Given my finding above, there is no claim for damages to address.

The Request for a Norwich Order

[37] Mr. Bishay seeks a Norwich Order requiring BMO to disclose “the nature, content and source of information received by the bank which led to its decision to terminate its banking relationship with the applicant”.

[38] A Norwich Order is extraordinary relief. The test to grant a Norwich Order was affirmed by the Supreme Court of Canada in Rogers Communications Inc. v. Voltage Pictures, LLC. at para 18, Mr. Bishay must establish:

(a) [a bona fide claim] against the unknown alleged wrongdoer;
(b) the person from whom discovery is sought must be in some way involved in the matter under dispute, and must be more than an innocent bystander;
(c) the person from whom discovery is sought must be the only practical source of information available to the applicant; the person from whom discovery is sought must be reasonably compensated for their expenses arising out of compliance with the discovery order in addition to their legal costs; and
(d) the public interests in favour of disclosure must outweigh the legitimate privacy concerns.

[39] Mr. Bishay submits that the Bank’s unilateral termination of his accounts must have resulted from erroneous information provided by an unknown source. He says that a Norwich Order is necessary for Bishay to identify the alleged wrongdoer and determine the extent of the wrongdoing, enabling him to assess or initiate legal proceedings against the responsible party. These potential claims may include defamation, misrepresentation, and other causes of action.

[40] Mr. Bishay has no evidence of a wrongdoer. He says it is inferred from the Termination Letter—it is only reasonable to assume that the information referred to by the Bank must have come from someone (the alleged wrongdoer). There is no evidence that the information came from any third party. As the Bank states in its factum, it is just as likely that information about Mr. Bishay originated from Mr. Bishay himself. Mr. Bishay provided evidence that Iristel, the telecom company of which he is the CEO, “is engaged in a serious and public dispute” with the CRA involving the CRA’s conclusion that “it had paid out $63 million to Iristel in illegitimate tax refunds.” In cross-examination, Mr. Bishay confirmed that he has been “very vocal” about the Iristel/CRA dispute, which has been litigated up to the Supreme Court of Canada and has been the subject of extensive media and online publications (some authored by Mr. Bishay himself).

[41] I am not persuaded that the alleged claim by Mr. Bishay is anything more than speculative. Although the bona fide standard is a relatively low standard as compared to a ‘prima facie’ standard—a purely speculative claim is not sufficient: see Seismotech Ip Holdings Inc. v. John Doe, 2023 FC 1649, at para 35-38, aff’d 2024 FCA 205.

[42] Given my finding that (a) of the test for Norwich Order has not been satisfied, it is not necessary to address the remaining factors. Mr. Bishay’s request for a Norwich Order is dismissed.

Disposition

[43] For the reasons above, the application by Mr. Bishay is dismissed.

[44] As agreed between the parties, costs in the amount of $25,000 all inclusive are to be paid by Mr. Bishay to Bank within 30 days hereof.

Jane Dietrich
Date: 2025-05-26