Executive Summary: Key Legal and Evidentiary Issues

• The plaintiffs, Lise Filion and Annette Morin, sought default judgment against their former lawyer, Marc Gauthier, and his professional corporation for misappropriating trust funds totalling $313,333.00.
• Liquidated damages were calculated at $209,733.60 after accounting for a prior partial recovery of $103,599.40 paid through LawPro.
• General damages for pain and suffering were dismissed due to insufficient evidentiary support, with counsel conceding the lack of evidence during submissions.
• Punitive damages of $30,000.00 were awarded on the basis that Mr. Gauthier's conduct was shocking, an offence to the court's sense of decency, and undermined public confidence in the legal profession.
• Costs on a substantial indemnity basis were fixed at $28,071.00, inclusive of fees, disbursements, and sales tax.
• Criminal charges, including fraud over $5,000.00, were laid against Mr. Gauthier on January 29, 2026, in relation to the misappropriated trust funds.

Facts of the case

Lise Filion and Annette Morin are sisters whose brother, Alain Filion, is deceased. His son, Frédéric Ippersiel-Filion, serves as Estate Trustee. In September 2023, the plaintiffs retained Marc Gauthier — a lawyer licensed to practice in Ontario operating in the Hawkesbury area — and his professional corporation, Cabinet Juridique Marc Gauthier Professional Corporation, to assist with the administration of their brother's estate. Margo L. Pomerleau represented the Estate.

On March 5, 2024, the parties reached an agreement regarding two properties jointly owned by the plaintiffs and the deceased. The River Lot, located at 2914 Bay Road, L'Orignal, Ontario, was to be sold to a third party, with Mr. Gauthier acting for both the Estate and the plaintiffs in that transaction. The plaintiffs agreed to purchase the deceased's interest in the Farm Lot, located at 2875 Bay Road, L'Orignal, Ontario, from the Estate for $313,333.00. On March 12, 2024, Mr. Gauthier provided his banking information and requested that the purchase funds be transferred to his trust account payable to "Marc Gauthier Professional Corporation in Trust." Ms. Filion transferred $156,667.00 on March 13, 2024, and Ms. Morin transferred $156,666.00 on March 14, 2024.

Mr. Gauthier advised the plaintiffs on April 3, 2024, that the land transfers would be completed on May 1, 2024. On that date, only the River Lot transfer was completed, and Mr. Gauthier was paid for his legal services. The plaintiffs last spoke with him on July 2, 2024, when he assured them that the Farm Lot paperwork was in order and that the transaction would occur shortly. From the anticipated May closing date through the end of September 2024, the plaintiffs and their family members made numerous unsuccessful attempts to reach Mr. Gauthier, including by visiting his office and locations he frequented. Ms. Pomerleau similarly followed up multiple times, writing to Mr. Gauthier on June 26 and July 26, 2024, and attempting to schedule meetings in July and early August, all of which were rescheduled or cancelled. On August 30, 2024, Mr. Gauthier responded to Ms. Pomerleau's August 19, 2024 email, citing a leave of absence and requesting a call — but no further communication or meeting followed. Ms. Pomerleau's client later attended his office and discovered it was closing.

On September 30, 2024, the plaintiffs retained new counsel, who issued a demand letter requiring Mr. Gauthier to make contact regarding the release of the $313,333.00 in trust funds, failing which proceedings would be commenced. No response was received. On October 2, 2024, a lawyer from Ms. Pomerleau's office contacted the plaintiffs directly, confirming that the Estate remained ready to close the transaction — and revealing that Ms. Pomerleau's office had not been advised that Mr. Gauthier's firm was holding the closing funds in trust.

Procedural history

Counsel for the plaintiffs contacted the court on October 4, 2024, to seek an urgent ex parte motion for a Mareva injunction. The Statement of Claim was issued on October 8, 2024. The matter first appeared before Justice Ryan Bell on October 15, 2024, and was adjourned to allow the plaintiffs to give the Law Society of Ontario (LSO) notice, as the assets sought to be frozen included the defendants' trust account. The LSO advised it did not take a position on the motion and did not intend to seek appointment as trustee of Mr. Gauthier's professional business. On October 16, 2024, Mr. Gauthier was ordered to attend on the return of the motion on October 21, 2024, and to bring the trust ledger and related records. He attended before Regional Senior Justice MacLeod but filed no material and brought no records. In the endorsement granting the Mareva injunction, RSJ MacLeod recorded that Mr. Gauthier acknowledged receiving the funds and depositing them into trust, but admitted he had withdrawn those funds for his own purposes and had not closed the real estate transaction.

The defendants were noted in default on November 12, 2024. On February 20, 2025, Daniel Iny wrote to plaintiffs' counsel advising that he had been retained by the Lawyers' Professional Indemnity Company (LawPro) on behalf of Mr. Gauthier, serving a Notice of Intent to Defend and requesting time to review the file before any default judgment was sought. Discussions were delayed by complications arising from multiple complainants alleging misappropriation of trust funds and a limited pool of funds available through LawPro. On August 20, 2025, the plaintiffs sought default judgment for a liquidated sum; the registrar declined to sign it the following day pursuant to Rule 19.04(3)(a) of the Rules of Civil Procedure. On January 29, 2026, Mr. Gauthier was charged with various criminal offences, including fraud over $5,000.00, in relation to the plaintiffs' trust funds. On February 5, 2026, the parties executed a full and final release as against LawPro and a partial release as against the defendants, reflecting a payment of $103,599.40 to the plaintiffs.

Court's reasoning and analysis

Justice Sirivar confirmed that where a defendant is noted in default, liability is deemed admitted; however, the court must still be satisfied that the plaintiff has established entitlement to the relief claimed and that damages are supported by the evidence.

On liquidated damages, the court found that the funds transferred to the defendants' trust account remained the property of the plaintiffs until properly applied. Mr. Gauthier acknowledged receiving the $313,333.00 for the purpose of closing the Farm Lot transfer, that the transaction never closed, and that the funds were not returned. After deducting the $103,599.40 already recovered through LawPro, the court found the remaining liquidated damages of $209,733.60 to be fixed, calculable, and supported by undisputed evidence.

On general damages, the court rejected the claim for $20,000.00 for pain and suffering, finding no evidentiary basis to support such an award. Counsel for the plaintiffs conceded the lack of evidence during submissions, and the court declined to infer compensable harm solely from the circumstances.

On punitive damages, Justice Sirivar applied the standard from Whiten v. Pilot Insurance Co., 2002 SCC 18, which limits such awards to cases involving "malicious, oppressive and high-handed" misconduct that offends the court's sense of decency, and requires that the amount be no greater than necessary to rationally accomplish denunciation and deterrence. The court drew guidance from Aubin v. Bowie, 2024 ONSC 5688, where Justice Heather Williams awarded $25,000.00 in punitive damages against a lawyer whose misconduct, while directed at a single vulnerable client, eroded public confidence in the legal profession. Justice Sirivar found that Mr. Gauthier's conduct — his complete disregard for his trust obligations, failure to communicate, failure to return the funds, and ultimate admission of misappropriation — was equally shocking and an offence to the court's sense of decency. The court also noted that Mr. Gauthier had been charged criminally and faced LSO proceedings, considering these only as part of the broader consequences arising from the same events.

Ruling and overall outcome

Justice Maria N. Sirivar granted judgment in favour of the plaintiffs, Lise Filion and Annette Morin. The court awarded liquidated damages of $209,733.60, punitive damages of $30,000.00 ($15,000.00 for each plaintiff), and costs on a substantial indemnity basis fixed at $28,071.00, inclusive of fees, disbursements, and sales tax, together with prejudgment and post-judgment interest in accordance with the Courts of Justice Act. The claim for general damages was dismissed. The total monetary award in favour of the plaintiffs amounts to $267,804.60.