Executive Summary: Key Legal and Evidentiary Issues

• Characterization of the 11 June 2024 “Entente” as a binding transaction versus a mere preliminary agreement conditional on signing a formal “Transaction Reçu-Quittance”
• Sufficiency of documentary proof of legal fees, including whether invoices and a zero-balance statement qualify as “reçus” under the settlement clause requiring proof of fees
• Alleged absence of agreement on an essential term (reception of receipts proving payment of fees by the employees) and its impact on contract formation and mutual consent
• Claims of vice of consent (error and dol) based on ACG’s understanding of who actually paid the legal fees and whether “important” fees had been incurred personally by the employees
• Determination of whether any contractual formality (a signed written transaction) was a condition of validity, or whether the email exchange alone created an enforceable transaction
• Scope of the court’s powers on homologation, including confirming the transaction as reached in the emails and tailoring the allocation between legal fees reimbursement and retirement allowance

Background and procedural history
Samuel Tessier et Alex Côté were employed by Groupe Capital Alternatif inc. (ACG), operating also under Alternative Capital Group inc., in the financial services sector. Their employment relationship deteriorated, and on 10 September 2018 ACG terminated their employment. The employees, through the CNESST, brought complaints to the Tribunal administratif du travail (TAT) contesting their dismissals. In March 2022, the TAT allowed their complaints, annulled the terminations, but held that reinstatement was not appropriate and reserved jurisdiction over appropriate remedial measures.[1] This initial success for Tessier and Côté triggered a series of related proceedings. ACG sought judicial review before the Superior Court in April 2023, seeking to overturn or suspend the TAT decision. Parallel to that, ACG had already launched substantial civil actions in damages against the two former employees and their new employer, Echelon Wealth Partners inc., alleging breach of non-competition and non-solicitation clauses in the employment agreements and breach of the duty of loyalty under article 2088 C.c.Q. ACG also commenced a smaller damages claim in the Court of Québec, which it eventually discontinued. Against this backdrop, the parties faced an upcoming TAT hearing in June 2024 on the remedial measures, creating settlement pressure on all sides.

Settlement negotiations and the June 11, 2024 Entente
In the week leading up to the remedial hearing at the TAT, counsel for ACG initiated settlement discussions with counsel for the CNESST, who represented Tessier and Côté. Initial proposals from ACG contemplated a global payment to the plaintiffs in exchange for a letter in which they would state that they had voluntarily resigned—directly contradicting their earlier testimony and the TAT’s findings. The plaintiffs counter-offered with a higher monetary figure and raised ethical concerns about the requested letter, suggesting that any such communication be made confidential and crafted to avoid perjury. Negotiations evolved and ACG ultimately increased its offer to a structure focused on a global payment to each claimant without persisting in its demand for the controversial letter. During these discussions, the CNESST’s lawyer advised ACG’s lawyer that Tessier and Côté had incurred “frais importants” (significant legal fees), but he did not specify a precise amount, and ACG did not request details at that stage. The parties discussed allocating part of any global settlement as a reimbursement of legal fees and the remainder as a retirement allowance, in part to maximize fiscal advantages relating to RRSP (REER) contributions and allowable deductions. On 11 June 2024, the day before the TAT hearing, the plaintiffs and the CNESST made a final written counter-offer by email. It proposed that ACG pay a total and global amount of 65,000 CAD to each of Tessier and Côté, with (1) a portion to be paid as reimbursement of legal fees incurred in the disputes with ACG, “sur présentation des reçus les démontrant,” and (2) the balance as an allocation de retraite, some or all of which could be paid directly into RRSP accounts without withholding, subject to available contribution room, with normal tax deductions on any residual amount. The proposal also included mutual full and final releases between ACG and each employee, procedural steps to file notices of out-of-court settlement in the various TAT and court files, a discontinuance by ACG of its civil action against Tessier and Côté (while preserving its claim against Echelon), a separate full and final release from CNESST regarding the pecuniary complaints, and standard confidentiality and mutual non-disparagement clauses. Later that morning, ACG’s counsel replied by email accepting this counter-offer. She confirmed that a settlement had been reached, that the upcoming TAT hearing would be cancelled, and that she expected to receive a draft transaction and release “conformément à l’entente intervenue” for review and comment. The TAT hearing was consequently cancelled on the strength of the agreement as documented in the email exchange.

Draft transaction, invoices, and dispute over receipts
After the email acceptance, the CNESST’s lawyer prepared formal draft documents titled “Transaction Reçu-Quittance” for each of the employees, consistent with the parties’ understanding that he would handle the drafting to save costs. These drafts maintained the total of 65,000 CAD per employee but proposed a more precise breakdown: an allocation de retraite of 35,158.40 CAD (less applicable tax) in consideration of the employees’ renunciation of reinstatement, and a net amount of 29,841.60 CAD as reimbursement of legal fees, corresponding to half of the total fees. Annexed were invoices from the law firm Ravinsky Ryan Lemoine s.e.n.c.r.l., counsel for the employees in ACG’s civil damages action. The invoices totalled 58,635.28 CAD, and were addressed “a/s de Alex Côté et Samuel Tessier.” However, the address line that would have shown their employer, Echelon, and the detailed descriptions of legal work were blacked out to protect both solicitor-client privilege and commercial sensitivities. ACG objected that it had not received true “reçus” proving that Tessier and Côté personally paid the legal fees in question. It asked for uncensored invoices showing the full client designation, as well as actual receipts or proofs of payment (cheques, electronic payment evidence) to confirm that the employees, and not their new employer Echelon, had borne the cost. In response, the CNESST’s lawyer provided a “Reminder notice” or statement from Ravinsky addressed to the employees at their personal addresses, indicating that the balance due on the account was zero. He also sent a revised draft transaction adjusting for stenographic transcription costs. He took the position that, taken together, the invoices and the zero-balance statement constituted the “reçus” contemplated by the June 11 clause, since they confirmed that the recorded legal services had been fully paid. ACG remained unsatisfied, insisting that these documents did not prove that the employees themselves had paid; it demanded proof of the method and source of payment, such as copies of the employees’ cheques or electronic transfers. It also expressed suspicion about the redactions and suggested that full payment details were “important” to ensure compliance with the original settlement.

Escalation, signed transactions by the employees, and new litigation
To break the impasse, the employees ultimately agreed to waive the specific tax-driven fee reimbursement structure and proposed that the entire 65,000 CAD payable to each of them be treated solely as an allocation de retraite. They signed a revised “Transaction Reçu-Quittance” containing that adjustment and returned it to ACG. This proposal would have given up the negotiated tax benefit of having part of the amount characterized as reimbursed legal fees. ACG nonetheless refused to sign the revised documents. Facing a deadlock, Tessier, Côté, and the CNESST filed a motion in the Superior Court in July 2024, later amended twice, seeking homologation of the June 11, 2024 email settlement. ACG responded with amended pleadings, including a counterclaim, and the matter proceeded through pre-trial steps, including examinations of the employees outside court. In those examinations, Tessier and Côté explained that part of the Ravinsky invoices had been paid via personal cheques drawn by them, and that the remainder had been advanced by their then-employer Echelon under an oral arrangement by which the fees would be recouped from their variable remuneration or commission accounts. ACG ultimately obtained copies of two cheques drawn by the employees to Ravinsky in identical amounts of 7,154.12 CAD, paid in late 2019. ACG argued that this evidence underscored its need for full payment documentation and its concern that it might be refunding fees effectively funded by Echelon, an entity against which ACG was itself litigating.

Key legal issues on the existence and scope of the transaction
The court first addressed a procedural point, allowing the plaintiffs to remodify their motion to homologate in light of the evidence heard at trial. Substantively, the central question was whether the June 11, 2024 email exchange created a legally binding “transaction” under articles 2631 and following of the Civil Code of Québec, or whether it was a non-binding “entente préliminaire” subject to a suspensive condition that a formal “Transaction Reçu-Quittance” be signed. ACG argued that article 1385 C.c.Q. and principles of “formalisme conventionnel” applied: in its view, the parties had agreed that the settlement would only take effect upon execution of a written transaction. The court rejected this thesis, emphasizing the consensualist nature of Quebec contract law. It noted that the CNESST lawyer’s email explicitly listed “tous et chacun des éléments essentiels” of the settlement, and that ACG’s counsel replied that she had authority to accept, expressly acknowledging that a settlement had been reached and relying on this to cancel the TAT hearing. Nothing in the email chain clearly stipulated that a signed transaction was a condition of validity, rather than a means of documenting an already concluded deal. The court further observed that ACG itself, through its then-lawyer, had threatened at one point to seek homologation of the “transaction intervenue” if the plaintiffs did not provide certain documents—implicitly recognizing that a binding settlement already existed. On this evidence, the judge found no clear mutual intent to subject the contract’s formation to a formal written instrument. The transaction therefore arose from the email exchange alone and was not conditional on signature of a later “Transaction Reçu-Quittance.”

Interpretation of the receipts clause and evidentiary sufficiency
ACG next claimed that no valid settlement existed because an essential element remained unfulfilled: under the June 11 clause, part of the payment was to be reimbursed “sur présentation des reçus les démontrant,” and, in its view, adequate receipts had never been produced. The court parsed this language in context. It found that the clause made the presentation of receipts a condition for treating a portion of the settlement as reimbursed legal fees for fiscal purposes, but the quantum and exact composition of the “frais d’avocats encourus” were never negotiated as essential to ACG’s willingness to pay a global 65,000 CAD per claimant. During negotiations, ACG had not asked for the exact amount of the legal fees before making, or accepting, offers, despite knowing in general terms that “frais importants” had been incurred. As for the documents themselves, the court held that the Ravinsky invoices plus the “Reminder notice” or statement sent to the employees at their personal addresses, showing a zero balance, together constituted “reçus” within the ordinary legal sense of that term—an instrument in which a person acknowledges having received a sum of money in payment. The judge accepted that these documents were sufficient to satisfy the receipt presentation condition in the June 11 clause, at least to the extent necessary to recognize that qualifying fees had in fact been incurred and paid. Moreover, specific evidence demonstrated that Tessier and Côté personally paid at least 14,308.24 CAD (7,154.12 CAD each) toward the first Ravinsky invoice via their own cheques. This made it unnecessary to resolve fully the evidentiary issues surrounding the later payments advanced by Echelon, especially once the plaintiffs narrowed their claim for fee reimbursement in the amended motion.

Alleged vices of consent: error and dol
ACG also sought to invalidate the settlement on the basis of vitiated consent, invoking both error (article 1400 C.c.Q.) and dol (article 1401 C.c.Q.), as incorporated into article 2634 C.c.Q.’s rules on the nullity of transactions. It argued that it had consented under the mistaken belief that the bulk of the “frais d’avocats encourus” had been personally borne by Tessier and Côté, when in reality much of the amount had been funded by Echelon. ACG contended that, had it known this, it would never have agreed to reimburse those fees while still in litigation against Echelon. The court analyzed these arguments against the legislative framework and doctrine on error and dol. It stressed that only an error relating to the nature of the contract, the object of the prestation, or another element that was truly essential and determinative of consent can ground nullity. It further emphasized that an inexcusable error—where a party failed to take reasonable steps to inform itself—cannot be invoked to annul a contract. Applying these principles, the judge found that ACG’s failure to inquire about the quantum of fees before agreeing to a global 65,000 CAD per claimant amounted to an inexcusable error, if error there was at all. The amount of the fees was presented only in general terms as “important,” and ACG made no effort to seek specifics before accepting the settlement. In addition, the plaintiffs and their lawyer had not concealed material information or made misleading representations. They disclosed that substantial legal fees had been incurred in the disputes with ACG, and this was objectively true even if some of those fees were initially funded by Echelon and then to be recovered from the employees’ variable compensation. There was no evidence of intentional deception, silence in bad faith, or other manoeuvres amounting to dol. Nor did ACG establish that any misunderstanding about the internal financing of the fees was truly determinative of its decision to settle on a global sum. The court therefore concluded that no vice of consent—neither error nor dol—had been proven that could justify annulling the transaction.

Adjustment of the fee reimbursement component and limits of the signed drafts
While the court recognized the June 11 email exchange as the true transaction, it separately considered the status of the later “Transaction Reçu-Quittance” documents signed by Tessier and Côté but rejected by ACG. Those drafts did not mirror the original agreement because they eliminated or fundamentally restructured the fee-reimbursement allocation. The judge held that the signed drafts could not be homologated in lieu of the original agreement: they included non-essential clauses and a revised breakdown that did not reflect the parties’ initial meeting of minds and were never accepted by ACG. Instead, the Superior Court confined itself to homologating the settlement as set out in the June 11 emails and then exercising its remedial discretion, within that framework, to determine an appropriate and enforceable allocation of the 65,000 CAD payments. To accommodate both the contractual text and the evidence of what had actually been paid by the employees, the court limited the reimbursable legal fees under the settlement to 7,154.12 CAD for each of Tessier and Côté (the amount each had personally paid by cheque toward the first Ravinsky invoice), with the balance of each 65,000 CAD to be treated as an allocation de retraite. This solution preserved the structure of the original transaction—global amount, fee reimbursement component, and retirement allowance—while tailoring the fee portion to the clearest documented out-of-pocket payments by the employees.

Outcome and monetary consequences
In its dispositive orders, the Superior Court authorized the plaintiffs’ amendments and formally homologated the transaction concluded on 11 June 2024 as evidenced by the email exchange. It declared that ACG must pay 65,000 CAD to each of Alex Côté and Samuel Tessier within 30 days of the judgment, with 7,154.12 CAD of each amount designated as reimbursement of legal fees incurred by the respective employee and the remaining 57,845.88 CAD classified as a retirement allowance. The judgment further ordered all parties to comply with the transaction’s other terms, including mutual releases, procedural steps to file notices of settlement and discontinuances in the related TAT and court files, CNESST’s release regarding the pecuniary complaints, and the confidentiality and non-disparagement commitments. Finally, the court granted the plaintiffs and the CNESST their costs, ordering that the judgment be rendered “avec les frais de justice.” However, the exact dollar figure for those costs is not fixed in the reasons and would be determined according to the usual tariff or taxation process. In practical terms, the successful parties are Tessier, Côté, and the CNESST. They secure enforcement of the settlement on the terms agreed in June 2024, with ACG ordered to pay a total of 130,000 CAD—65,000 CAD to each employee—plus judicial costs, the precise monetary value of which is not specified in the judgment.