Executive Summary: Key Legal and Evidentiary Issues

• Beneva Inc. and Services d'investissement Beneva Inc. sought an interlocutory injunction against their former representative, Marie-Hélène Gagnon, to enforce post-resignation non-competition and non-solicitation obligations.
• Central to the dispute is whether clause 14.1 of Contracts P-8 and P-11 is enforceable, given that the term "territory" is undefined in both contracts.
• Surveillance conducted on April 9, 10, and 11, 2025 revealed that Gagnon visited important clients to deliver symbolic gifts and provide her personal contact details around the time of her departure.
• Following her resignation, portfolio transfers involving approximately 81 clients with Beneva products valued at approximately $14,986,698, and 90 SIB products tied to 29 clients totalling $6,121,966, were recorded.
• Delays in pursuing the injunction — with the hearing held more than one year after Gagnon's departure — undermined the plaintiffs' claim of serious or irreparable harm.
• Balance of convenience favoured Gagnon, as the situation had largely stabilized and an ambiguous injunction order would have imposed an unjustified burden on her.

Facts of the case

Beneva Inc. (operating also as Conseils financiers Beneva) and Services d'investissement Beneva Inc. (collectively, "the plaintiffs") are financial services and insurance companies operating in Quebec. Marie-Hélène Gagnon ("Gagnon") served as an independent representative for Beneva and its predecessor, La Capitale services conseils inc. ("CSC"), for more than ten years, and for SIB for approximately two years. At the end of 2024, she ranked as the fourth most important representative within the Beneva/SIB network. On April 10, 2025, Gagnon formally resigned from both representative contracts.

Her departure prompted immediate concern from the plaintiffs. Surveillance conducted on April 9, 10, and 11, 2025 revealed that Gagnon was visiting important clients to deliver symbolic gifts — specifically, a blanket/throw — informing them of her impending departure and ensuring they had her personal cell phone number. The day after Gagnon announced her resignation, the plaintiffs' external counsel issued a notice of termination for serious cause and a formal demand that she cease any conduct contrary to her non-competition and non-solicitation obligations. In the weeks and months that followed, numerous clients transferred their investment products away from Beneva/SIB — transfers the plaintiffs attributed "presumably" to Gagnon's influence, representing a portfolio of approximately $21,231,087 out of a total portfolio value of $56,498,368.04, or approximately 37.6% of her book, at the time of her departure.

The plaintiffs commenced an action for damages and permanent injunction on May 23, 2025. They also sought an interlocutory injunction, though no application for a provisional interlocutory injunction or safeguard order was ever made. The plaintiffs only requested a hearing date for the interlocutory injunction on January 16, 2026 — more than nine months after Gagnon's departure. The hearing was held on April 23, 2026, more than one year after the resignation.

Contractual clauses at issue

The plaintiffs' case rested on restrictive covenants contained in two contracts: Contract P-8, in force since January 1, 2020, between Gagnon and CSC (now Beneva); and Contract P-11, in force since January 1, 2023, between Gagnon and SIB. Both contracts described Gagnon as an "independent contractor." Each contained a clause 14 imposing post-resignation obligations for a period of two years, prohibiting Gagnon from directly or indirectly soliciting, offering, or selling insurance or investment products to: (a) clients of CSC/SIB within territories where Gagnon was authorized to operate during the five years preceding resignation; (b) clients recruited or served by Gagnon outside her assigned territory; and (c) in the case of Contract P-11, all clients "from Conseils financiers Beneva" — whether or not they fell within any territory and whether or not Gagnon had personally served them. Contract P-11 also broadly defined "client" to include current, former, and potential contract holders (prospects). In exchange for these restrictions, Contract P-8 entitled Gagnon to commissions for twelve months following resignation, subject to exceptions including a significant contractual breach on her part. Both contracts were standard-form adhesion contracts whose terms were non-negotiable and applied uniformly to all of the plaintiffs' representatives.

Court's reasoning and analysis

The court evaluated the three criteria for granting an interlocutory injunction: appearance of right, serious or irreparable harm, and balance of convenience.

On appearance of right, the court found that the plaintiffs met the low threshold of demonstrating that their claim was neither frivolous nor vexatious. Gagnon's visits to key clients around the time of her departure, her involvement in subsequent client portfolio transfers, and her signed April 14, 2025 acknowledgment of her contractual obligations each supported a colorable claim. However, the court found the plaintiffs' appearance of right to be weak, not strong. The central problem was the undefined concept of "territory" in clause 14.1. Neither Contract P-8 nor Contract P-11 defined "territory" or provided a mechanism for assigning one to a representative. Gagnon — who had worked with the company for over ten years — stated she had never been assigned a territory and had always prospected clients freely. The plaintiffs only specified three addresses as constituting Gagnon's territories in an amendment to their claim filed more than five months after the proceedings began, without adequate contextual explanation. The single client-purchase contract produced (P-29) did not contain the word "territory" at all, referring instead to "business portfolios." Even the 2014 predecessor contract, which did include a territory clause, defined "territory" inconsistently — sometimes as a geographic zone and sometimes as a grouping of public sector employees — raising further interpretive difficulties. The court also noted the potentially excessive scope of clause 14.1, which extended beyond clients personally served by Gagnon to all clients within an assigned territory, as well as all Quebec public sector employees within that territory, and — under Contract P-11 — to all Beneva clients from the prior five years regardless of any territorial connection.

On serious or irreparable harm, the court declined to find this criterion satisfied. While jurisprudence recognizes client loss as generally difficult to quantify and thus potentially irreparable, the court held that no automatic conclusion of harm follows every alleged breach of a non-competition or non-solicitation clause. The evidence showed that portfolio transfers had occurred primarily between May and July 2025 and had since stabilized. The last recorded Beneva product transfer was dated September 18, 2025, and no new transfers from either Beneva or SIB were alleged after January 13, 2026. The plaintiffs offered no current evidence that Gagnon's allegedly wrongful conduct was ongoing. The court found that the plaintiffs' lack of urgency in pursuing the injunction undermined any claim that serious or irreparable harm was likely absent an order.

On balance of convenience, the court concluded that the scales tipped against granting the injunction. The consequences of Gagnon's departure had already largely crystallized over the preceding year. Beneva retained a network of 184 independent representatives and SIB had 117, and both companies regularly handled between 25 and 40 representative departures annually. Gagnon, by contrast, did not take confidential information, did not disparage the plaintiffs, and the evidence showed that client-initiated transfers — rather than active solicitation — were the primary driver of any portfolio movement. Granting an injunction based on ambiguously worded clauses would impose an unjustified burden on Gagnon, who would be unable to readily identify all persons subject to the interdiction. The court further noted that the plaintiffs had, from the outset, withheld the post-resignation commissions that served as consideration for Gagnon's non-solicitation and non-competition obligations — a factor the court found far from irrelevant to the equities of enforcing those same obligations.

Ruling and overall outcome

The court rejected the plaintiffs' application for an interlocutory injunction in its entirety. The successful party was the defendant, Marie-Hélène Gagnon. The decision was rendered by the Honourable Alexandre-Philippe Avard, J.C.S. of the Superior Court of Quebec on May 27, 2026. Costs were awarded against the plaintiffs, though no precise monetary amount was specified in the judgment. The court emphasized that its decision was not to be read as indifference to the importance of contractual obligations, but reflected the serious questions raised regarding the validity and scope of the restrictive covenants, the lack of demonstrated ongoing harm, and the balance of inconvenience favouring the defendant. The underlying merits action — including the plaintiffs' claim for $929,000 in damages and permanent injunctive relief through April 10, 2027 — remains to be determined at trial.