Executive Summary: Key Legal and Evidentiary Issues

• Dispute stems from a commercial construction subcontract where the main contractor paid subcontractors directly after the excavation subcontractor defaulted on its payment obligations.
• A written settlement titled « Reconnaissance de dette – Engagement – Transaction – Quittance » created a recognized debt with a fixed payment schedule and imposed solidary personal guarantees on the principals of the subcontractor.
• Evidence consisted primarily of corporate records, the main and subcontracts, the signed Transaction (including clauses 7b, 13 i and 14), and sworn declarations from the plaintiff’s representative.
• Total non-payment of five instalments, despite clear due dates and a high contractual interest rate of 2% per month (24% per year), established default under the Transaction.
• The assignment of assets by the corporate subcontractor (cession de biens) shifted the practical focus of enforcement to the individual guarantors, who did not respond to the court proceedings.
• Construction Pierre Blouin inc. obtained homologation of the Transaction and a solidary condemnation against the Boily brothers for 261,473.35 $ in principal and extrajudicial fees, plus monthly compounded interest at 24% annually.

Background and parties

Construction Pierre Blouin inc. is a company that operates mainly in the field of commercial building construction. In this case, it was the main contractor on a project to expand a school and upgrade its mechanical and electrical systems. In order to perform a portion of this work, Construction Pierre Blouin inc. subcontracted excavation and related site work to Entreprise d’excavation Boily & Frères inc., a company specializing in excavation and grading. Bernard Boily and Daniel Boily are shareholders of Excavation Boily and act respectively as its president and vice-president. They therefore controlled the subcontracting company and were closely involved in its business and contractual undertakings.

Contractual structure and payment problems

Under the main contract, Construction Pierre Blouin inc. bore overall responsibility for the school project. It passed on part of this responsibility to Excavation Boily through a subcontract for excavation and related works. Excavation Boily, in turn, entered into further subcontracts with other subcontractors to carry out parts of its scope. Problems arose when Excavation Boily failed to pay the amounts owed to its own subcontractors. Faced with the risk of unpaid subcontractors, and the potential claims and disruptions that could follow, Construction Pierre Blouin inc. stepped in and paid those subcontractors directly to ensure that the project continued and that no additional claims would be made against it or the project.

The recognition of debt and transaction

To regularize and secure repayment of the sums it had advanced, Construction Pierre Blouin inc. entered into a formal settlement with Excavation Boily and the two Boily brothers on 7 August 2025. The document was titled « Reconnaissance de dette – Engagement – Transaction – Quittance ». This instrument served several functions at once: it recorded a recognition of debt by Excavation Boily towards Construction Pierre Blouin inc.; it set out an engagement by the debtor to repay; it constituted a transaction (settlement) of the dispute relating to the unpaid subcontractors; and it provided for a quittance (release) upon due performance. A key feature of the Transaction was that Bernard and Daniel Boily personally bound themselves as solidary sureties. By assuming solidary personal guarantees, they agreed that they would be personally and jointly liable with the company for the full amount of the debt recognized in favour of Construction Pierre Blouin inc.

Key financial terms and clauses at issue

The Transaction fixed the total debt to be repaid in five instalments. The scheduled instalments totaled 227,545.83 $. In addition, the parties agreed that Excavation Boily would pay 15,000.00 $ in capital for professional fees incurred in the preparation of the recognition of debt and transaction itself, as set out in clause 13 i. Together, these amounts formed a principal sum of 242,545.93 $ owed to Construction Pierre Blouin inc. The agreement also contained provisions regarding enforcement costs. Clause 14 provided that the debtor would be responsible for the professional fees and disbursements incurred to enforce the Transaction, including any steps taken to obtain its homologation by the court. These enforcement-related fees and disbursements eventually totaled 18,927.42 $. The Transaction further specified the applicable interest. Clause 7b provided for interest at a rate of 2% per month, equivalent to 24% per year, calculated and capitalized monthly, starting from 7 August 2025. This relatively high contractual interest rate, compounded monthly, was intended to encourage timely payment and compensate the creditor for any delay.

Default under the transaction and insolvency context

Despite this detailed written agreement, the debtors did not comply with their obligations. None of the five instalments were paid, even though their due dates had passed by the time of the hearing. As a result, the entire repayment structure under the Transaction went into default. In the meantime, Excavation Boily made an assignment of its property (cession de ses biens) on 10 October 2025, signalling financial collapse and raising insolvency considerations. Given this assignment, Construction Pierre Blouin inc. directed its request for condemnation solely against Bernard and Daniel Boily as personal solidary sureties, rather than pursuing the insolvent corporate debtor. In the court proceedings, the Boily brothers did not respond to the summons and did not file a defence. The court therefore considered the case on the basis of the originating application, the supporting exhibits (including corporate records, the subcontract documents, and the Transaction), and a sworn declaration from the representative of Construction Pierre Blouin inc. attesting to the facts and the outstanding amounts.

Court’s analysis and homologation

The court’s task was to determine whether the conditions for homologating the Transaction were met and whether the plaintiff had established its entitlement to the amounts claimed. The evidence showed that Construction Pierre Blouin inc. had paid subcontractors on behalf of Excavation Boily, that a formal recognition of debt and transaction had been signed on 7 August 2025, and that Bernard and Daniel Boily had personally agreed to be solidary sureties. The document itself clearly set out the sums owed, the repayment schedule, the additional professional fees for preparing the agreement, the obligation to cover enforcement-related fees and disbursements, and the contractual interest rate with monthly capitalization. The default was established by the fact that no payment had been made on any of the instalments by the time of the hearing. The defendants’ failure to contest or respond to the action meant there was no contradictory evidence or legal argument to undermine the plaintiff’s claims.

Outcome, successful party, and monetary award

On this record, the Superior Court granted the application to homologate the Transaction. It declared the Transaction of 7 August 2025 binding and enforceable and condemned Bernard and Daniel Boily, solidarily, to pay Construction Pierre Blouin inc. the principal sum of 242,545.93 $, representing the five unpaid instalments and the agreed 15,000.00 $ in professional fees, together with interest at 2% per month (24% per year), calculated and capitalized monthly from 7 August 2025 pursuant to clause 7b. The court also condemned them, again solidarily, to pay 18,927.42 $ in extrajudicial professional fees and disbursements incurred to enforce the Transaction, with the same monthly compounded interest from 7 August 2025. In total, the principal and extrajudicial amounts awarded come to 261,473.35 $, with the ultimate total including interest depending on when the sums are actually paid. Construction Pierre Blouin inc. is therefore the successful party in this litigation, having obtained homologation of the Transaction and a solidary condemnation against the Boily brothers for 261,473.35 $ plus substantial contractual interest at 24% per year compounded monthly.