Executive Summary: Key Legal and Evidentiary Issues

• Prima facie validity of a non-competition and non-solicitation agreement signed by a departing employee in exchange for a $100,000 payment is central to the injunction.
• Scope and reasonableness of the non-competition clause are questioned because it appears unlimited in territory, activities, and duration, yet still deemed apparently valid at the provisional stage.
• Evidence from an employee’s sworn declaration and a recorded meeting shows the former employee’s clear intention not to respect his restrictive covenants and to build a competing business.
• Risk of irreparable harm arises from potential loss of clientele and employees, which the court treats as harm that is difficult to quantify and justifies urgent injunctive relief.
• The balance of convenience favours the employer, who legitimately expects compliance with the restrictive covenants after paying significant consideration to the former employee.
• Urgency is established by the close timing between the meeting where the former employee discussed competing activities and the filing of the provisional injunction application.

Facts of the case

Signalisations Prosign Québec inc. (“Prosign”) employed Mario Sylvestre until his departure on 26 February 2025. At the end of the employment relationship, the parties entered into an agreement that included both non-solicitation and non-competition undertakings in favour of Prosign. In consideration for these restrictive covenants, Prosign agreed to pay Mr. Sylvestre a total amount of $100,000. This sum was structured as two instalments: $50,000 payable within three days of signing, and a second $50,000 payable on 1 January 2026. Both payments were made as agreed under the termination arrangement.
Following his departure, and after receiving the full contractual payments, Mr. Sylvestre began interacting with persons connected to Prosign. In January 2026, he contacted a Prosign employee, Justice Maci. With his employer’s authorization, Mr. Maci met Mr. Sylvestre on 2 February 2026. That meeting, along with a sworn declaration by Mr. Maci and a recording of their conversation, later became key pieces of evidence before the Superior Court of Québec.

The post-employment agreement and restrictive covenants

The agreement signed on 26 February 2025 contained both a non-solicitation clause and a non-competition clause. The judgment emphasizes that, as a matter of general employment law, a former employee owes a duty of loyalty that typically includes refraining from soliciting the former employer’s employees and clients for a certain period of time. The non-solicitation undertaking in this case aligned with that principle, and the court accepted that such a promise was compatible with the former employee’s ongoing duty of loyalty.
The non-competition clause, however, raised more difficult questions. The court observed that it was “illimitée” (unlimited) as to territory, the prohibited activities, and the duration. In Québec law, restrictive covenants must generally be limited in time, territory, and scope of activities to be enforceable. At first glance, a clause without such limits might be vulnerable to a challenge as being unreasonable and thus invalid. Despite these concerns, the judge noted that, at the provisional injunction stage, the court does not decide the final validity of the non-compete clause. Instead, it asks whether there is at least a serious issue to be tried and whether the clause appears valid on a prima facie basis. Relying on prior case law on non-compete clauses at the interim stage, the court concluded that the questions about scope and reasonableness were legitimate, but not sufficient at this point to find the clause clearly unreasonable. The fact that Prosign paid a substantial sum of $100,000 in consideration of the restrictive covenants reinforced, in the judge’s view, the appearance of validity of the non-competition obligations.

Evidence of non-compliance and intention to compete

The evidentiary foundation of Prosign’s request came from two key sources: the sworn declaration of its employee, Mr. Justice Maci, and the recording and transcript of his meeting with Mr. Sylvestre on 2 February 2026. The court found that this material clearly showed that Mr. Sylvestre was not respecting the obligations he had undertaken in February 2025 and had no intention of doing so in the future. According to the judge, the discussions captured in the recording and recounted in the declaration demonstrated that Mr. Sylvestre was actively trying to “build a business” in direct competition with Prosign’s business. There was also a concern—though not definitively proven—that he may have begun his competing activities after receiving the second $50,000 instalment from Prosign on 1 January 2026. All of the conversations between Mr. Sylvestre and Mr. Maci were interpreted by the court as showing an intention by Mr. Sylvestre to disregard his contractual obligations to Prosign.

Legal framework for the provisional injunction

The case was heard at the stage of a provisional injunction (an urgent, temporary remedy). The court applied the four established criteria for granting such relief: appearance of right (or serious issue to be tried), urgency, balance of convenience (balance of inconveniences), and risk of irreparable harm. On the appearance of right, the court adopted the approach from prior decisions, which state that this threshold is not demanding: the applicant must show only that the claim is not frivolous or vexatious, and that there is a serious question to be resolved. In the context of non-compete clauses, the case law cited by the judge holds that validity cannot be finally decided at the provisional stage, but that the court must be satisfied the clause contains identifiable limits on time, territory, and activities, or at least that it does not appear clearly unreasonable at first glance. Applying this framework, the judge concluded that the restrictive covenants in Prosign’s agreement, particularly when viewed in light of the $100,000 consideration, appeared prima facie valid. With respect to irreparable harm, the court emphasized that loss of clientele and loss of employees can constitute serious and irreparable prejudice to an employer, precisely because such losses are difficult to quantify and compensate adequately in damages after the fact. Prior appellate jurisprudence in Québec supports treating such harm as irreparable for injunction purposes. On the balance of convenience, the judge concluded that Prosign was entitled, at least provisionally, to expect that a former employee who had been paid substantial consideration would respect the obligations freely undertaken. Conversely, allowing Mr. Sylvestre to continue building a competing business while ignoring his covenants would expose Prosign to significant and potentially unquantifiable harm. Finally, the criterion of urgency was met. The court linked urgency to the close temporal connection between the February 2, 2026 meeting and the filing of the injunction request. Once Prosign learned, through its authorized employee and the recording, that Mr. Sylvestre was ignoring his obligations and moving forward with a competing venture, it moved promptly to seek a provisional order.

Outcome and financial aspects

After weighing all four criteria, the Superior Court granted Prosign’s application. The judge allowed the request for a provisional injunction and signed the draft judgment submitted by the applicant, thereby ordering Mr. Sylvestre to respect the post-employment obligations he had undertaken in the February 26, 2025 agreement. Prosign thus emerged as the successful party at this provisional stage. As to the financial dimension, the judgment notes that Prosign had already paid Mr. Sylvestre a total of $100,000 in consideration of the non-solicitation and non-competition undertakings. However, the injunction ruling itself does not set out any specific monetary award of damages or a quantified costs order in favour of Prosign or Mr. Sylvestre. The court’s remedy is injunctive and preventative, not compensatory. Based on this decision alone, the successful party is Signalisations Prosign Québec inc., and the total amount ordered or awarded in its favour cannot be determined, aside from the background fact that Prosign had previously paid $100,000 to Mr. Sylvestre under the parties’ agreement rather than receiving any monetary award in this ruling.