Executive Summary: Key Legal and Evidentiary Issues

• Jurisdictional conflict between the Tribunal administratif du logement (TAL) and the Small Claims Division over whether claims arising from residential leases but framed as extra-contractual fall within TAL’s exclusive competence.
• Characterization of Student Housing MTL’s claim as extra-contractual civil liability based on alleged wrongful conduct (water shutoff affecting business operations), rather than contractual lease enforcement.
• Determination that a non-signatory to the residential leases (Student Housing MTL) is not bound to proceed before the TAL and may instead sue in the Cour du Québec, Small Claims Division.
• Assessment of res judicata (chose jugée) and litispendance in light of multiple prior TAL decisions involving the landlord and only the individual tenant-signatory (Ms. Tanguay), but not Student Housing MTL.
• Analysis of the “triple identity” test (same parties, cause, and object) and the impact of TAL’s limited jurisdiction on whether its decisions can preclude a later civil action.
• Rejection of the landlord’s declinatory and res judicata objections, allowing Student Housing MTL’s damage claims to proceed on the merits in Small Claims, with no costs awarded at this stage.

Background and factual context

Student Housing MTL is a company that rents apartments and then sublets rooms to foreign students. Its sole administrator, Ms. Céline Tanguay, personally signed two residential leases with landlord Farzad Peyrow for apartments located at two different Montreal addresses. The leases were concluded on the standard form prescribed by the Tribunal administratif du logement (TAL), and only Ms. Tanguay is identified there as tenant, not Student Housing MTL. Student Housing MTL used the leased units in its business model, renting out individual rooms to international students who occupied the premises. The relationship between Ms. Tanguay, Student Housing MTL, and Mr. Peyrow eventually deteriorated, in part due to a shutoff of water supply to the leased properties and related issues surrounding rent payments and performance of lease obligations. On 21 January 2021, in earlier proceedings before the TAL, the tribunal terminated the residential leases between Mr. Peyrow and Ms. Tanguay and ordered her to pay certain unpaid rents. Thereafter, other TAL decisions addressed late payment of rent, the impact of the pandemic on Ms. Tanguay’s ability to pay, and her allegations that the water shutoff justified abandonment of the premises, as well as her own later claim for restitution of sums allegedly overpaid and damages tied to the water interruption.

Claims brought by Student Housing MTL in small claims

In the present proceedings before the Cour du Québec, Small Claims Division, Student Housing MTL—not Ms. Tanguay personally—filed modified claims in two files corresponding to the two leased apartments. The company sought damages from Mr. Peyrow for loss of rental income and various expenses allegedly caused by a cut in water supply to the apartments. It alleged that his conduct was wrongful and directly affected its commercial operations, including the student housing business it conducted from those locations. In one file, Student Housing MTL claimed approximately CAD 14,855.49 in relation to the first address, and in the other, about CAD 14,978.49 in relation to the second address. It also asserted that part of the damages reflected unrecouped improvement costs it had undertaken in each unit to make them suitable for student accommodation. Crucially, these claims were framed not as contractual lease disputes, but as extra-contractual civil liability claims for business losses allegedly caused by the landlord’s actions, notably the water shutoff.

Procedural posture and declinatory applications

In response, Mr. Peyrow filed identical applications in both small claims files seeking dismissal of Student Housing MTL’s claims. He raised two main grounds. First, he argued that the TAL had exclusive jurisdiction over the dispute because it arose from residential leases. In his view, the claims “resulted from” a residential lease within the meaning of the Code of Civil Procedure provisions limiting Small Claims jurisdiction and the TAL’s organic statute granting it exclusive authority over lease-related matters. Second, he argued that the case was barred by res judicata (chose jugée) because the TAL had already rendered several decisions concerning the same leases, the water shutoff, and related monetary claims between himself and Ms. Tanguay. He attempted to rely on four prior TAL decisions: the termination judgment, the decision dealing with pandemic-related rent delays and the alleged justification for vacating because of the water cut, and the dismissal of Ms. Tanguay’s later action seeking a refund and damages over the same water supply issue. The applications were heard together due to the connection between the facts underlying the two files, and the court issued a single judgment covering both matters.

Jurisdictional analysis: TAL versus small claims

The court began by identifying the central legal question: whether the TAL has exclusive jurisdiction over Student Housing MTL’s claims. Under article 537 of the Code of Civil Procedure, the Small Claims Division lacks jurisdiction over claims “resulting from a residential lease.” The TAL’s enabling statute, in turn, confers on it exclusive jurisdiction over “any application relating to a residential lease,” including a tenant’s claim for damages, but only where the parties before it are parties to the lease as defined by the Civil Code of Québec. The judge emphasized that the TAL’s jurisdiction rests on the existence of a residential lease within the meaning of article 1892 C.c.Q. and a dispute “between the parties to that lease.” By contrast, non-signatories such as mere occupants or third parties may have only extra-contractual remedies against a building owner, and those claims do not fall under the TAL’s mandate. In this case, the court noted that Student Housing MTL was not a signatory to the leases; only Ms. Tanguay signed them in her personal capacity. While earlier TAL rulings classified those leases as noncommercial residential leases, that characterization did not control the present dispute, because the present plaintiff was a different legal person. Indeed, Mr. Peyrow himself argued that there was no contractual relationship between him and Student Housing MTL, effectively acknowledging the absence of any lease bond between them. The court accepted that Student Housing MTL’s demands were not based on the leases as such but on alleged wrongful conduct—cutting water service and its impact on Student Housing MTL’s commercial operations—constituting an extra-contractual civil liability claim. Consequently, because the plaintiff was a non-signatory advancing extra-contractual claims, the TAL had no jurisdiction to hear its demands, and the Small Claims Division of the Cour du Québec was the proper forum.

Res judicata and prior TAL decisions

The court then turned to the argument that Student Housing MTL’s action was barred by res judicata (chose jugée) or potentially by litispendance. It reiterated that both doctrines require proof of a “triple identity”: identical parties, identical cause, and identical object in both proceedings. Moreover, before even reaching these substantive conditions, courts must verify that both tribunals compared actually had jurisdiction over the same dispute; if one lacked jurisdiction, there can be no proper comparison and no risk of contradictory outcomes. The judge acknowledged that TAL decisions can, in some circumstances, have res judicata effect if they satisfy the criteria in article 2848 C.c.Q. However, the presumption of res judicata is to be interpreted restrictively because it constitutes an exception to the principle that parties should be free to assert their rights before judicial courts. Applying these principles, the judge held that TAL lacked jurisdiction to adjudicate Student Housing MTL’s extra-contractual claim in the first place, which already undermined any res judicata argument vis-à-vis this plaintiff. On the identity-of-parties requirement, the court highlighted that only Ms. Tanguay was party to the TAL proceedings, whereas Student Housing MTL—though administered by her—is a distinct juridical person with separate legal personality. This alone defeated the “same parties” prong. On identity of cause and object, the court accepted that the underlying factual circumstances, including the water shutoff and lease termination, overlapped between the TAL cases and the current action. But the object of Student Housing MTL’s action was framed as extra-contractual liability for commercial losses, distinct from the TAL disputes, which concerned implementation of contractual obligations arising from the leases (rent arrears, termination, and related contractual remedies). Because both the identity of parties and object were absent and the TAL lacked jurisdiction over this type of claim by this plaintiff, the res judicata and litispendance arguments could not succeed.

Absence of policy wording or insurance clauses

Although the dispute involves residential leases on the TAL’s standard form and allegations about water supply and business losses, the judgment does not discuss any insurance policy, insurance coverage, or specific contractual clauses beyond referencing that the leases were TAL-prescribed residential lease forms. There is no analysis of insurance policy terms, exclusions, or indemnity clauses, nor any detailed parsing of particular lease provisions. The focus remains on the nature of the claims (contractual versus extra-contractual), the status of the parties as signatories or non-signatories to the leases, and the allocation of jurisdiction between the TAL and the Small Claims Division.

Outcome, successful party, and monetary consequences

Ultimately, the court dismissed Mr. Peyrow’s applications to have Student Housing MTL’s claims rejected on both jurisdictional and res judicata grounds. It then referred both small claims files back to the Small Claims Division’s scheduling office so that they could proceed on a common evidentiary record and be heard on the merits at a later date. In this procedural judgment, Student Housing MTL is therefore the successful party, as its actions survive and move forward while the landlord’s declinatory challenge fails. No damages or costs are awarded at this stage; the judgment expressly indicates that it is rendered “without costs.” Because the court has not yet adjudicated the underlying damage claims and has not assessed monetary relief, the total amount granted or ordered in favor of Student Housing MTL in this decision cannot be determined for costs or monetary award—it is effectively zero at this interlocutory stage.