Executive Summary: Key Legal and Evidentiary Issues

• Interpretation of s. 627.17(1) of the Bank Act regarding whether it requires banks to maintain accounts after opening.

• Scope of a bank’s obligation under the Bank Act versus its rights under common law and contractual terms.

• Distinction between the statutory requirement to “open” an account and any obligation to “maintain” it.

• Applicability of exceptions under s. 627.18(1) for account closure.

• Review of the application judge’s statutory interpretation and findings.

• Award of costs to the successful party following dismissal of the appeal.

Facts of the case

Samer Bishay opened a chequing account with the Bank of Montreal (BMO) on June 28, 2022. On May 28, 2024, BMO notified Bishay that it was terminating its banking relationship with him, citing concerns that his past business or personal activity did not align with BMO’s risk tolerance. By the time of the hearing, all of Bishay’s accounts with BMO had been closed, including the chequing account at issue.

Bishay brought an application before the Superior Court of Justice seeking several orders: that BMO be compelled to reinstate his chequing account, that a Norwich order be issued, and that a trial be directed as to damages. He did not dispute that, under common law, banks can terminate relationships with reasonable notice and without justification. Instead, he relied on s. 627.17(1) of the Bank Act, arguing that BMO was required not only to open but also to maintain his account.

Discussion of policy terms and statutory provisions

Section 627.17(1) of the Bank Act requires banks to open a retail deposit account for a customer who presents the required identification. The key issue was whether this provision also obligates banks to keep such accounts open indefinitely, absent exceptions listed in s. 627.18(1), such as illegal or fraudulent activity, material misrepresentation, or other prescribed circumstances.

The application judge framed the issue as one of statutory interpretation: does the word “open” in s. 627.17 mean merely to open an account, or does it also require the account to remain open? After reviewing the legislative context and intent, the judge concluded that s. 627.17 pertains only to the opening of accounts, not their maintenance or closure. The judge found that account closure is governed by the agreement between the bank and customer and by common law principles, not by s. 627.17.

Appeal and outcome

On appeal, Bishay renewed his arguments, emphasizing that s. 627.17 should be interpreted as consumer protection legislation requiring banks to keep accounts open unless an exception in s. 627.18(1) applies. The Court of Appeal found no merit in these arguments, agreeing with the application judge that the statute does not impose a duty to maintain accounts, only to open them. The Court emphasized that the word “open” means to start something, not to continue it indefinitely, and that there is no reference to “maintain” in the relevant provision.

Ruling and overall outcome

The Court of Appeal dismissed Bishay’s appeal, finding no reviewable error in the application judge’s reasoning. The Court adopted the lower court’s interpretation of the Bank Act and confirmed that BMO’s closure of the account did not violate s. 627.17. Costs were awarded to BMO as the successful party, in the agreed amount of $15,000 all-inclusive. The decision clarifies that banks’ obligations under s. 627.17 of the Bank Act are limited to the initial opening of accounts, and that ongoing maintenance or closure is governed by contract and common law, not by this statutory provision.