What You Need to Know – Gee Judge, I Obeyed the Law and I Still Have to Pay Damages?

In 2012, L’Association des résidents de Mont-Tremblant pour la qualité de la vie[i] (the “Residents’ Association”) initiated a class-action against the owners and operators (the “Owners”) of an automobile racetrack (the “Racetrack”) located in Mont Tremblant, Quebec[ii] before the Superior Court of Quebec. A judgment was rendered on March 24, 2020.

?The essence of the Residents’ Association’s class-action suit is summarized as follows:

“[The Owners] knowingly and through carelessness, allowed the Racetrack to be used to generate intolerable noise levels causing [the Residents’ Association’s] members serious damages…”[iii]

?The Residents’ Association based its lawsuit on the Civil Code of Quebec (“CCQ”) which reads:

?“Neighbours shall suffer the normal neighbourhood annoyances that are not beyond the limit of tolerance they owe each other, according to the nature or location of their land or local usage.”

?It claimed damages of $19,000,650.00 on behalf of “… all those who resided at any time between May 11, 2009. and October 31, 2018, in the City of Mont Tremblant (“the City”), within 3 kilometres (“km”) of the Racetrack broken down as follows:

?·??????$2,500.00 per year for the 670 resident members of the nearby Zone for a total of $16,750,000.00; and

?·??????$2,000.00 per year for the 145 resident members of more distant Zone for a total of $2,900,000.00.”[iv]

?Among the Owners’ defences was that the Racetrack’s operations respected the law, in particular Bylaw 2006-2009 of the City (the “Bylaw”), which established “… a framework setting out the requisite conditions under which the neighbourhood annoyances are tolerable…”[v]

Importantly, there was never any question that the Racetrack respected the terms of the Bylaw.[vi] However that was not the question before the Superior Court. The issue was whether, even though it respected the Bylaw the Racetrack’s operations violated Article 972 CCQ.[vii]

?In the end, the Superior Court concluded that the Owners breached their duty of good neighbourliness, but only with respect to the nearby Zone and only when “…noise levels were greater than 55 decibels per hour which could go up to 58 decibels.”[viii] It also condemned the Owners to pay compensation varying from $150.00 per year to $750.00 per year to members of the Residents’ Association residing in the neighbouring Zone. The exact amount each member received depended on when they moved into the Zone. For example, it awarded those who had moved in prior to August 1964, $750.00 per year while those who moved in after September 2006, received $150.00 per year.[ix]

?The Owners appealed to the Court of Appeal of Quebec.[x] Among their grounds of appeal was that they conformed to Bylaw, and hence that they should not have been found in contravention of Article 976 CCQ.[xi]

?The Court of Appeal did not agree:

?“… conformity of a particular activity to legislation in force, including in the context of regulations specifically [governing the activity], does not confer immunity against a lawsuit based on Article 67 CCQ. In other words, depending on the circumstances, the inconveniences can be considered to be abnormal and serve as a basis for a claim under Article 976 CCQ, despite the fact that the activity giving rise to [the inconvenience] is otherwise authorized and legal. Conformity to a regulatory structure of the activity can therefore not in and of itself serve as a defence nor … constitute as absolution from creating a nuisance. … municipal bylaws serve only to govern behaviour and usage within a municipality’s territory, and, on the other hand, because the application of the provisions of Article 769 CCQ … necessitates making of proof which must be, in each case, determinative with regard to the inconveniences suffered and their particular nature given the place where they occur.

?This having been said, a regulatory framework may sometimes, even often, constitute a pertinent factor in the global factual evaluation of the alleged neighbourhood troubles as in certain cases, it reflects a compromise between divergent interests and can constitute a guide to reaching an equilibrium between everyone’s rights and determine the limits of tolerance of neighbours.”[xii]

?For this and other reasons the Racetrack’s judgments were dismissed.[xiii]

?WHAT YOU NEED TO KNOW

?·??????When conducting activities which can disturb or inconvenience neighbours, the mere fact that such activities conform to the applicable laws or regulations, including municipal bylaws, does not, in and of itself, shelter one from claims for damages and/or demands for cease-and-desist orders, because such activities cause “… neighbourhood annoyances that are… beyond the limit of tolerance…” neighbours owe each other in violation of Article 976 CCQ.

?UPDATE

?We recently wrote about the Judgment of the Superior Court, in the case Gloutnay vs. Rozon.[xiv] Readers may remember that, in that case, the Superior Court ordered the Juste Pour Rire group of companies to re-hire Mr. Andre Gloutnay with pay and all benefits retroactive to the date of his unjustified dismissal.

?We have learned that the Juste Pour Rire group of companies have appealed the Superior Court’s Judgment. Such appeal has the effect of staying or suspending the execution or enforcement of the Superior Court Judgment until the Court of Appeal renders its judgment unless a judge of the Court of Appeal grants provisional execution.[xv]

?In the Gloutnay case, Mr. Gloutnay applied to the Court of Appeal for an order allowing the Superior Court Judgment to be enforced, at least as to the payment of his back salary and benefits, notwithstanding the appeal.[xvi] In rejecting Mr. Gloutnay’s application for provisional execution, Mr. Justice Patrick Healy of the Court of Appeal wrote:

?“… without prejudging the appeal, I note that the judgement of [the Superior Court] has an obvious flaw. In a strictly civil [law] context and without supporting his ruling, the [trial] judge created an important precedent in requiring the re-hiring of [Mr. Gloutnay] in his former job, when that job no longer exists, and jurisprudence is clear on the limitations on the powers of the Superior Court with respect to such remedy.”[xvii]

?We draw this to your attention because it is an indication that the Superior Court’s Judgment may be reversed in whole or in part. Nevertheless, our caution, that employers should not guarantee and employee employment for life, still stands.

?It goes without saying that the preceding comments are general in nature and are not intended to offer any legal advice regarding any specific situation.

?[i] The Mont Tremblant residents’ association for the quality of life (our translation from the French original).

[ii] L’Association des résidents de Mont-Tremblant pour la qualité de la vie vs. Courses automobiles Mont-Tremblant inc. (2020 QCCS 1061).

[iii] Paragraph 1 of the Superior Court Judgment. (Our translation of the French original).

[iv] Para. 2 of the Superior Court Judgment.

[v] Para. 115 of the Superior Court Judgment.

[vi] Para. 125 of the Superior Court Judgment.

[vii] Paras. 126 & 127 of the Superior Court Judgment.

[viii] Para. 585 of the Superior Court Judgment.

[ix] Para. 586 of the Superior Court Judgment.

[x] Courses automobiles Mont-Tremblant inc.vs.L’Association des résidents de Mont-Tremblant pour la qualité de la vie (2022 QCCA 1063)

[xi] Para. 5 of the Court of Appeal Judgment.

[xii] Paras. 7 & 8 of the Court of Appeal’s Judgment (internal quotations, footnotes, and citations omitted).

[xiii] Para. 26.

[xiv] 2022 QCCS 2578.

[xv] Articles 656 & 661 of the Code of Civil Procedure.

[xvi] Para. 1 of the Judgement on the application for provisional execution.

[xvii] Para. 12.