Executive Summary: Key Legal and Evidentiary Issues

• Evidentiary status and admissibility of a surreptitious restaurant recording and its transcript where the transcript was never formally filed but used extensively by all parties.
• Characterization of the recorded speakerphone call between the former president and company counsel as non-privileged and non-private, given its occurrence in a public place and absence of legal advice.
• Threshold for disqualifying counsel and his law firm where the lawyer is expected to be an essential witness on core issues, including the existence and scope of his mandate and the client’s access to legal advice.
• Appropriateness of deciding a motion for inhabilité at an interlocutory stage despite arguments that pre-trial examinations might later obviate the need for the lawyer’s testimony.
• Propriety of refusing to hear the lawyer’s own testimony at the disqualification hearing, in order to avoid a mini-trial on contested facts and credibility regarding his role.
• Denial of a confidentiality and sealing order over the transcript in light of its prior public use in filed submissions and the absence of any demonstrated interest based on privacy or solicitor-client privilege.

Facts of the case
The dispute arises from an aborted transaction in which 2855-2222 Québec inc. sought to acquire an immovable worth nearly 45 million dollars. The company’s former president, the late Isaac Gelber, led the negotiations and caused the company to pay a deposit of 1.5 million dollars toward the purchase. The negotiation process was conducted through real estate brokers, Core Consultants Realty Inc. and its representatives, Margad Otgonzul and Orlando Biscotti. They acted as intermediaries between 2855-2222 Québec inc. and the seller, Capreit Limited Partnership. In addition to challenging the failed transaction, the company also attacked a separate brokerage agreement under which it had agreed to pay a commission to the brokers regardless of whether the purchase was actually completed.
2855-2222 Québec inc. alleged that, at the time of the negotiations and the signing of the relevant documents, Mr. Gelber was over 90 years old, experiencing cognitive decline, vulnerable and isolated. The company claimed he did not benefit from legal advice sufficient to understand the scope of the obligations he was incurring on its behalf. On this basis, it sought to annul the agreements tied to the immovable acquisition and to recover the 1.5-million-dollar deposit, framing the lack of legal support and Mr. Gelber’s vulnerability as central to its theory of the case.

The surreptitious recording and the lawyer’s role
The brokers disputed the idea that Mr. Gelber had been effectively left without legal counsel. They maintained that, during the relevant period, he was in contact with the company’s long-time lawyer, Me Pierre V. LaTraverse. To support this, they relied on an audio recording secretly made by Ms. Otgonzul during a meeting with Mr. Gelber and Mr. Biscotti at a restaurant. At that meeting, Mr. Gelber received a call from Me LaTraverse. He chose to answer it on speakerphone (“mains libres”), in a public place and in the presence of the brokers. Because of this, the brokers heard the entire exchange, and the conversation was captured on the recording.
The respondents had the call transcribed and used the transcript in a motion before the Superior Court to have Me LaTraverse and his firm declared inhabiles (disqualified) from further acting for 2855-2222 Québec inc. They alleged that the recording demonstrated an active professional relationship between Mr. Gelber and the lawyer at the time of the negotiations. This, they argued, directly undermined the company’s claim that its president was isolated from legal advice and made Me LaTraverse an essential witness on key contested facts: the existence and scope of his mandate, the nature of his exchanges with Mr. Gelber and the practical availability of legal advice to the former president.

Proceedings in the Superior Court
In the Superior Court, the respondents presented their motion for a declaration of inhabilité. They did not, at that stage, formally file the audio recording or the transcript as exhibits, in part to allow 2855-2222 Québec inc. the opportunity to object. However, they reproduced substantial portions of the transcript in their written plan of argument filed with the court. At the hearing, counsel for Me LaTraverse, appearing for the company, read passages from the transcript aloud during submissions. Although the company had signalled its intention to contest the admissibility of the conversation, it never actually advanced a formal objection at the hearing.
The trial judge considered the contents of the transcript in his analysis. He concluded that the brokers had established a sufficient basis to justify calling Me LaTraverse as a witness at trial. In his view, the issues of representation and of Mr. Gelber’s cognitive state were central to the litigation, and the recorded conversation constituted a serious indication that the lawyer was indeed involved during the negotiations. Even if the recording was not conclusive proof of a mandate, it supported the inference that the lawyer’s testimony would be important and potentially decisive on non-peripheral facts. On that basis, the judge held that Me LaTraverse’s dual role as counsel and necessary witness was incompatible with the proper administration of justice and declared both him and his firm disqualified from representing 2855-2222 Québec inc.

Issues on appeal
2855-2222 Québec inc. appealed the Superior Court judgment to the Court of Appeal of Quebec. It raised several challenges. First, it argued that the transcript had never been validly introduced into evidence and therefore should not have been relied upon either by the trial judge or by the appellate court. It characterized the transcript as new evidence on appeal that was inadmissible and claimed that the trial judge erred by failing to rule on the company’s previously announced objection to its filing.
Second, the company invoked solicitor-client privilege and privacy rights, asserting that the conversation between Mr. Gelber and Me LaTraverse was presumptively privileged as part of a broader, complex legal mandate and that it engaged Mr. Gelber’s right to privacy. From that standpoint, 2855-2222 Québec inc. argued that the recording and transcript should have been excluded or, at minimum, protected by a confidentiality and sealing order.
Third, the company submitted that it was premature to declare its lawyer and his firm inhabiles at this stage of the proceedings. It contended that pre-trial examinations of other witnesses, such as family members and a mortgage broker, might eventually show that the lawyer’s testimony was not necessary.
Finally, the appellant criticized the trial judge’s refusal to allow Me LaTraverse to testify during the disqualification hearing. The lawyer had offered to state, under oath, that he had not been advising Mr. Gelber with respect to the contested immovable transaction. In the appellant’s view, this would have removed the need to call him at trial and rendered disqualification unnecessary.

Findings on the transcript, privilege and confidentiality
The Court of Appeal rejected the company’s procedural objections concerning the transcript. It held that, in substance, all parties and the trial judge had treated the transcript as if it were in evidence. The respondents had relied on it in their written submissions and argument, and counsel for Me LaTraverse had himself quoted from it in open court. In that context, the absence of a formal exhibit number was viewed as a mere technical oversight that did not prevent the judge from considering its contents. Because the appellant never actually articulated or argued its announced objection at the hearing, it could not later complain on appeal that the objection remained undecided.
On the issues of solicitor-client privilege and privacy, the Court of Appeal concluded that the recorded conversation was not protected. It stressed that Mr. Gelber had voluntarily answered his lawyer’s call on speakerphone in a public restaurant and in the presence of the brokers, and that his remarks tended to reassure them of his intention to close the deal despite family opposition. The content of the transcript showed no request for legal advice, no legal analysis and no opinion being given by Me LaTraverse. The appellant’s attempt to characterize the exchange as privileged on the basis of a supposed “complex, ongoing mandate” was undermined by its own pleadings, which insisted that Mr. Gelber generally lacked legal advice on the very agreements under attack. There was no concrete evidence before the court establishing the existence of a broad mandate covering the impugned transaction.
Given these elements, the Court of Appeal held that the recognized criteria for solicitor-client privilege were not met for this particular conversation. It also noted that the circumstances and content were such that any factual presumption of confidentiality over lawyer-client communications could be rebutted. For similar reasons, the court found no privacy violation in recording and using a conversation that the client had chosen to conduct on speakerphone in a public setting, within earshot of the other participants.
The Court of Appeal likewise dismissed the appellant’s motion for a confidentiality and sealing order over the transcript. It observed that the transcript’s contents had already been made public through their reproduction in the respondents’ written plan of argument filed with the Superior Court without any confidentiality measures. In the absence of privilege or a substantive privacy interest, there was no sufficient legal ground to justify exceptional protection of a document already in the public domain.

Disqualification of counsel and timing of the motion
On the central question of inhabilité, the Court of Appeal agreed that the Superior Court had correctly identified the governing principles for disqualifying counsel. It emphasized that disqualification is warranted where the lawyer’s testimony appears necessary and important on key contested issues and where maintaining the lawyer in the record would compromise the integrity of the proceedings.
The court endorsed the trial judge’s conclusion that Me LaTraverse’s evidence was likely to be essential. The presence or absence of legal advice to Mr. Gelber during the negotiations lay at the heart of 2855-2222 Québec inc.’s claim to invalidate the agreements and recover the deposit. While family members, a mortgage broker or other witnesses could speak to some aspects of Mr. Gelber’s condition or conduct, only Me LaTraverse could directly address the scope of his mandate and the practical availability of legal advice to the former president concerning the transaction, particularly given that the lawyer was advising the company on other matters at the same time.
The appellant’s argument that the motion was premature was also rejected. The Court of Appeal underscored that the alleged isolation of Mr. Gelber from legal advice was central to the company’s case and that this made the lawyer’s potential testimony non-peripheral from the outset. It also highlighted the inconsistency in the appellant’s positions: in the Superior Court, 2855-2222 Québec inc. had argued that the disqualification motion was late given the file’s progress, whereas on appeal it claimed that it was too early to decide the issue. Against the backdrop of the principle of proportionality in civil procedure, the Court considered it appropriate for the trial judge to resolve the question of inhabilité once a solid factual basis existed, rather than postponing it in the hope that it might become moot.

Refusal to hear the lawyer at the disqualification hearing
The Court of Appeal found no error in the trial judge’s refusal to hear Me LaTraverse as a witness on the disqualification motion itself. The lawyer wished to testify that he had not advised Mr. Gelber on the contested transaction, a statement that went directly to the merits of whether his testimony would be necessary at trial. Allowing this would have opened the door to cross-examination and contrary evidence from other witnesses, effectively transforming the interlocutory motion into a mini-trial on disputed facts and on the lawyer’s credibility.
The appellate court agreed that such a course would undermine the very rationale of the disqualification rule, which is to prevent a lawyer from simultaneously acting as counsel and as a central witness on contested issues. It accepted the trial judge’s view that the proposed solution, while superficially appealing, would create the conflict it purported to avoid. Accordingly, the refusal to hear the lawyer at that stage was justified in light of the nature of the motion and the need to preserve the integrity of the trial process.

Outcome and monetary consequences
Having rejected the appellant’s procedural and substantive arguments, the Court of Appeal dismissed the appeal. It confirmed the Superior Court’s order declaring Me Pierre V. LaTraverse and his law firm disqualified from acting for 2855-2222 Québec inc. in the underlying litigation. The respondents—Core Consultants Realty Inc., Margad Otgonzul, Orlando Biscotti and Capreit Limited Partnership—were thus the successful parties on appeal. The court also rejected the appellant’s motion for a confidentiality and sealing order in relation to the transcript of the surreptitious recording. The decision awards costs of justice against 2855-2222 Québec inc., but the total monetary amount of those costs, and any other damages or monetary awards, is not quantified in the judgment and therefore cannot be determined from the text of the decisions.