Case: Laliberté v. Québec Revenue Agency, 2025 BCCA 406 (CanLII)
Keywords: telecommunications services; stay of proceedings; quasi-criminal proceedings; Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36
Synopsis:
The Appellant is the operating mind of several companies selling telephone and telecommunications services in Canada. Four of these companies – part of the “TNW group” – are subject to Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36 (“CCAA”) proceedings in B.C. (See para. 5). The B.C. Supreme Court issues a stay order preventing proceedings being commenced or continued against the directors or officers of TNW companies. (See paras. 5-6). Notwithstanding the order, the Respondent Agence du revenu du Québec commences quasi-criminal proceedings against the Appellant under the Tax Administration Act, CQLR, c. A-6.002; the Cour du Québec finds him guilty. (See para. 8).
The Appellant says the Respondent’s proceedings against him are improperly commenced (i.e., because they violate the terms of the B.C. Supreme Court order in the CCAA proceedings). (See para. 8). The Cour du Québec disagrees, finding the CCAA stay order does not apply to quasi-criminal proceedings. (See para. 9; Agence du revenu du Québec c. Laliberté, 2024 QCCQ 7102 at paras. 221–241). Back in B.C., the Appellant brings what the B.C. Court of Appeal calls a “collateral attack on the Québec proceedings”. The Appellant seeks declaratory relief (e.g., a declaration that the quasi‑criminal proceedings contravene the CCAA order). (See para. 11). Coval J. agrees with the conclusion of the Court du Québec (i.e., the CCAA order does not apply; does not preclude the bringing of quasi-criminal charges by the Respondent). (See para. 13). The Appellant brings an application for leave to appeal that decision in the B.C. Court of Appeal. Dickson J.A. dismisses the application in chambers. The Appellant then applies to vary that decision pursuant to s. 29 of the Court of Appeal Act, S.B.C. 2021, c. 6. (See paras. 1, 14). The Court of Appeal (Groberman, Edelmann, and Warren JJ.A.) finds the Appellant’s argument is “devoid of merit”; that there is no basis upon which the Court could vary Dickson J.A.’s order. (See paras. 15, 21).
Importance:
The Court of Appeal described the “considerations that apply to a leave application” as follows:
With the interests of justice being an overriding consideration, the four factors to be taken into account are as follows:
- whether the point on appeal is of significance to the practice;
- whether the point raised is of significance to the action itself;
- whether the appeal is prima facie meritorious or, on the other hand, whether it is frivolous; and
- whether the appeal will unduly hinder the progress of the action. (See para. 2).
As described by the Court of Appeal, Dickson J.A.’s assessment was that the proposed appeal “lacked prima facie merit”; that the facts of the proposed appeal were unique, and that it was “unlikely, in the circumstances to have broad public importance or precedential value”. Also significant for Dickson J.A.: the CCAA proceedings had “long since concluded” and so the issues raised by the Appellant “could have no importance to the underlying proceedings”. (See para. 3).
Regarding the prima facie merits of the Appellant’s proposed appeal, the Court of Appeal found that s. 11.1 of the CCAA provides a “complete answer” to the argument that the CCAA stay order precluded the Respondent’s quasi-criminal charges proceedings. In particular, s. 11.1(2) says “[N]o order made under section 11.02 affects a regulatory body’s investigation in respect of the debtor company or an action, suit or proceeding that is taken in respect of the company by or before the regulatory body, other than the enforcement of a payment ordered by the regulatory body or the court.” (See para. 17). The Court of Appeal determined that the underlying quasi-criminal proceeding was “clearly” subject to this language, and that the stay had expired such that it “simply could not affect the proceedings in Québec”. (See para. 18).
Ultimately, the Court of Appeal found no basis to interfere with Dickson J.A.’s “exercise of discretion in denying leave” and confirmed the denial of leave to appeal. (See paras. 20-21). However, one may reasonably ask whether determining the scope of stay powers exercised pursuant to the CCAA (i.e., a federal statute) vs. the quasi-criminal/regulatory powers of a province is a question “of significance to the practice” and one which, if definitively answered, would benefit the interests of justice?
The Appellant, appearing in person (via videoconference): Benoit Laliberté
Counsel for the Respondent (via videoconference): S. D. Pinsonnault and É. Labbé