Executive Summary: Key Legal and Evidentiary Issues

• Dispute over whether the defendants’ “option contraire” under a shotgun (désaccord complet) clause validly mirrors the plaintiffs’ offer or instead constitutes an impermissible counter-offer.
• Interpretation of the unanimous shareholders’ agreement and the plaintiffs’ withdrawal offer regarding complete and timely release of personal guarantees, endorsements and suretyships at closing.
• Contest over corporate governance and control of Pavé Design Inc., including whether one shareholder can act as sole director with full powers pending the share transaction.
• Assessment of the interlocutory injunction test, including appearance of right, serious or irreparable prejudice, urgency and balance of convenience, in a commercial shareholder dispute.
• Evidence of the defendants’ restriction of access to corporate systems, emails and regulatory platforms and the resulting risk to RBQ licensing and the plaintiff’s status as “répondant”.
• Determination that conservatory measures to maintain operational and regulatory status quo are justified, while rejecting the defendants’ request to concentrate administrative power in one director.

Facts of the case

Pavé Design Inc. is a Quebec construction company active in excavation, grading, concrete paving and the erection of retaining walls. Its shares are held by two sides: the plaintiffs, Éric Veilleux and Gestion du Hérisson Inc., and the defendants, Michaël Racine and Gestion Michaël Racine Inc. The relationship between these shareholder groups deteriorated, leading to a dispute over the operation of a “désaccord complet” (shotgun) mechanism contained in their unanimous shareholders’ agreement signed on 23 December 2022. A key feature of this corporate structure is that both sides are simultaneously shareholders and, for at least some individuals, administrators and guarantors for the company’s obligations. This overlap between ownership, governance and personal financial exposure shapes much of the conflict. The plaintiffs commenced the shotgun process on 27 November 2025 by serving an offer (the “offre de retrait”) to purchase the defendants’ shares at a specified price and on defined terms and conditions, including how and when personal guarantees would be released. Under the contractual mechanism, the offeree shareholders may, within a fixed period, either accept the offer or exercise an “option contraire” to reverse the roles, buying instead of selling (or vice versa) on identical price, terms and conditions.

Shotgun clause and contractual framework

The unanimous shareholders’ agreement sets out, among other things, obligations concerning the release of personal guarantees and the procedure for a complete disagreement (shotgun) scenario. Article 73 stipulates that, except in cases of forced withdrawal for incapacity or protective regimes, buyers must ensure that the selling shareholder is completely released, as of the date of the transaction, from all endorsements, suretyships and personal guarantees relating to the company’s affairs. Articles 78 to 81 govern the shotgun mechanism. An “offrant” wishing to end the relationship must notify the other shareholders and formally and irrevocably offer, for 30 days, either to buy their shares or to sell his own, on price, terms and conditions he determines, backed by a solvency declaration. The other shareholders then have the same period either to accept the offer or to exercise the option contraire, which must adopt “les mêmes prix, termes et conditions” as those in the original offer; failing any response within the delay, they are deemed to have accepted and must give full effect to that acceptance. The plaintiffs’ withdrawal offer reiterates this structure and includes a specific clause on release of guarantees. In clause 3.A of the offer, Veilleux undertakes, in line with the agreement, to ensure that the defendants are released, at the closing date of the share sale, from all endorsements, suretyships or personal guarantees they have given for the benefit of the company, subject to a further detailed provision at clause 3.E. The contractual framework is therefore explicit that liberation from personal security must occur at closing, and that the party reversing the shotgun through an option contraire must effectively mirror the same terms.

Competing positions on the option contraire

The defendants purported to exercise their option contraire on 12 January 2026 and then modified it on 30 January 2026, seeking to buy the plaintiffs’ shares instead. The plaintiffs argue that these documents do not constitute a faithful mirror of the original withdrawal offer but amount instead to a counter-offer, incompatible with a valid exercise of the shotgun option contraire. Their core contention is that the defendants’ proposal, both initially and as amended, deviates from the parties’ express contractual obligations and from the withdrawal offer, particularly by failing to guarantee full and definitive release of the plaintiffs’ personal guarantees, endorsements and suretyships at the date of closing. They contend that the option contraire mechanism demands strict adherence to the original terms; any material variation, especially regarding the timing and completeness of the release of personal security, undermines the integrity of the process. On this footing, they say the defendants’ option contraire is null, invalid and without effect; consequently, only the plaintiffs’ original withdrawal offer remains valid and binding, giving the plaintiffs the right to compel the defendants to sell their shares on the terms set out in that offer. The defendants, by contrast, maintain that their option contraire complies with, or at least respects the spirit of, the unanimous shareholders’ agreement and the withdrawal offer. They insist they are now entitled to require the plaintiffs to sell their shares under the terms elaborated in a draft share purchase agreement circulated on 30 January 2026. A key provision of that draft is clause 2.4 on release of endorsements, under which the buyer undertakes to take all necessary steps to obtain, within 90 days of closing, releases from the seller’s commitments, suretyships, liabilities or endorsements made for the company’s benefit, and the buyer and the company agree to indemnify the seller until full release is obtained. The plaintiffs highlight this 90-day post-closing release period as a departure from the agreement’s requirement of immediate liberation at closing, reinforcing their view that the option contraire is non-conforming.

Interim injunction proceedings and evidentiary context

In response to the unfolding conflict and the defendants’ conduct, the plaintiffs filed an originating application seeking a declaratory judgment, specific performance of the withdrawal offer and both provisional and interlocutory injunctive relief. They allege that the defendants have engaged in inappropriate and inadequate behaviour that excludes them from the effective conduct of the company’s affairs, including by restricting their access to corporate platforms, email addresses and security cameras and by changing passwords without properly updating the internal register maintained at the company. The defendants respond with their own urgent application for a safeguard order, effectively asking the court to recognize Michaël Racine as sole administrator of Pavé Design Inc., with full powers under law and the shareholders’ agreement, notwithstanding that agreement and to the exclusion of Veilleux. The court considers the affidavits of both Veilleux and Racine, and the documentary exhibits filed by each side, in determining whether the high threshold for provisional injunctive relief is met. The analytical framework is the classic test developed in Supreme Court of Canada jurisprudence and applied by Quebec courts: appearance of right (or strong appearance of right for mandatory injunctions), risk of serious or irreparable harm or of rendering the final judgment ineffective, balance of convenience and urgency. The judge underscores that interlocutory injunctions are exceptional, discretionary remedies that must be granted sparingly, only where an actual or imminent infringement of an apparent right threatens irreparable prejudice that damages cannot adequately repair. At this preliminary stage, the court expressly refrains from deciding the ultimate validity of the shareholders’ agreement provisions or the withdrawal offer, noting appellate guidance that first-instance courts should not, in injunction proceedings, resolve the merits but rather determine whether there is a serious question to be tried. The plaintiffs’ argument that the defendants’ option contraire is in substance a counter-offer—because it does not respect the agreed requirement of complete and timely release of personal security—strikes the judge as prima facie justified and based on clear, freely negotiated parameters, even though the defendants’ position is not frivolous.

Risk of prejudice and balance of convenience

The evidence indicates that the defendants have restricted the plaintiffs’ access to various corporate resources, changed passwords, and failed to record those changes in the company’s internal register. These manoeuvres risk the suspension, restriction or loss of regulatory licences and of the recognized “répondant” status with the Régie du bâtiment du Québec (RBQ), consequences that would be highly prejudicial to the plaintiffs and difficult, if not practically impossible, to repair merely by an award of damages. The situation is particularly acute because Veilleux is the sole RBQ répondant for Pavé Design Inc., and both he and his corporate vehicle continue to bear financial responsibility for company obligations through personal endorsements, suretyships and guarantees. Being shut out of the management and information systems of a company for which one remains both shareholder and guarantor creates an asymmetric risk: exposure without control. The court finds that the plaintiffs, still shareholders and—so far as Veilleux is concerned—still an administrator and RBQ répondant, are no longer able to operate the business fully due to the defendants’ actions. By contrast, the measures they seek are conservatory and temporary, aimed at maintaining the operational and regulatory status quo until the merits are decided, without determining the parties’ substantive rights or depriving the defendants of their shareholder prerogatives.

Orders granted and parties’ relative success

Given this context, the court concludes that the plaintiffs satisfy the criteria for provisional injunctive relief. It issues a series of time-limited orders, effective until 16 February 2026 at 23:59, requiring the defendants to maintain the operational and regulatory status quo of Pavé Design Inc. and prohibiting any measure suggesting a change of control or sole management under the disputed shotgun mechanism. The defendants are ordered not to present themselves as solely directing or controlling the company; to cease using non-corporate email addresses (notably “mrpavedesign@gmail.com”) for company affairs; to transmit to the plaintiffs all emails, attachments and metadata exchanged or received through such addresses; to restore and maintain full access for the plaintiffs, especially Veilleux as RBQ répondant, to all systems, platforms and email boxes used for the company’s business (including Microsoft 365, accounting and management software, A.C.Q., C.C.Q. and RBQ-related platforms, servers, backups and security cameras); to provide a complete list of all access credentials, administrative rights and recovery keys; and to preserve intact all corporate email data, servers, cloud services, accounting records and digital backups from 27 November 2025 onward. The judgment further orders that all funds held or to be held in trust in connection with the transaction, the purchase agreement or the shotgun mechanism remain fully preserved in fidéicommis without disbursement, set-off, allocation or disposition. The plaintiffs are dispensed from furnishing security, and provisional execution is ordered notwithstanding appeal, with authorization to serve the judgment by any means, outside legal hours and on non-juridical days, costs on this motion being reserved. On the defendants’ safeguard application, the court rejects their request to appoint Racine as sole administrator with full powers, holding that nothing at this early stage justifies such a measure and that it would be particularly inappropriate given Veilleux’s ongoing role as RBQ répondant and guarantor. The only aspect of the safeguard motion that is acknowledged is the defendants’ undertaking not to restrict access to platforms, email addresses and cameras, and not to change passwords without proper inscription in the company’s records; this is taken acte, with no order for costs (“sans frais de justice”). In practical terms, the plaintiffs are the successful party at this provisional stage: their injunction is granted in substantial part, and the defendants’ competing safeguard motion is mostly dismissed. The judgment, however, does not award any quantified damages or monetary sum, and even the question of costs on the plaintiffs’ motion is left “with costs to follow”, such that the total monetary amount ordered in their favour cannot be determined from this decision.