Executive Summary: Key Legal and Evidentiary Issues

• Two related surety companies sought reimbursement from a borrower who had defaulted on micro-loans arranged through a common corporate network.
   
• Contracts signed by the defendant declared a 23.75% interest rate but omitted suretyship fees from that calculation.
   
• Ownership and billing arrangements among the plaintiffs and a related collection firm pointed to internal accounting transfers rather than genuine third-party costs.
   
• Quebec's Consumer Protection Act was found to already capture suretyship fees as credit charges even before a 2024 legislative amendment made this explicit.
   
• Evidence of assignment of the debt to the sureties before they had paid the original lender undermined the plaintiffs' standing.
   
• Nullity of the underlying loan contracts, once granted, extinguished the plaintiffs' derivative claims as sureties.
   

Facts of the case

Garantie d'Amérique inc. and 9442-4553 Québec inc. (operating as Caution Express) brought two consolidated small claims actions against Neyl Yanis Himi, seeking $1,729.39 and $1,505.48 respectively. Both plaintiff companies are controlled by Sébastien Boucher and act as sureties for micro-loans. In June 2022, Boucher arranged financing for Himi through Gestion Multi-Finance inc., resulting in two identical loan contracts signed the same day. The first advanced $1,015.00, of which $315 was retained as a suretyship fee, leaving Himi with $700; the declared interest rate was 23.75%. The second advanced $749.28, of which $249.28 was retained as a suretyship fee, leaving Himi with $500, again at a declared rate of 23.75%. Himi did not dispute non-payment but argued the loans' real interest rate exceeded 100% and breached the Consumer Protection Act (CPA). The plaintiffs claimed they had paid Gestion Multi-Finance $1,015.50 and $757.60 respectively as sureties [source states these figures without reconciling them against the $1,015.00 and $749.28 loan principals cited earlier in the judgment], plus $747.88 each in collection fees billed by 9304-5284 Québec inc. (Services Administratif S.B.), another Boucher-controlled company. The court noted this collection charge had been billed twice for the same information about Himi, and found no proof that the plaintiffs had actually paid either Gestion Multi-Finance or Services Administratif S.B. The assignment of Himi's debt from Gestion Multi-Finance to the sureties occurred before the sureties had paid anything, and the assignment document was addressed generically "to whom it may concern" without naming a surety.

Policy and legislative provisions at issue

The central legal question was whether suretyship fees form part of "credit charges" under section 70 of the CPA. At the time the contracts were signed, section 70 listed components of credit charges — interest, insurance premiums, rebates, administration and brokerage fees, membership fees, commissions, and statutory charges — introduced by the word "notamment" (including, in particular). Since 2024, section 70 has been amended to expressly add suretyship fees to that list. The court also considered sections 271 and 272 of the CPA, which allow a consumer to seek nullity of a contract, removal of credit charges with reimbursement, reduction of obligations, or damages where a credit contract fails to properly disclose payment terms, credit charges, or the credit rate, unless the merchant shows the consumer suffered no prejudice.

Reasoning and analysis

The court relied on articles 2803 and 2804 of the Civil Code of Québec, which place the burden of proof on the party asserting a claim, on a balance of probabilities. It found the plaintiffs' corporate structure — all entities controlled by Sébastien Boucher, including the collection firm Services Administratif S.B. — indicated that claimed third-party costs were in fact internal accounting transfers rather than genuine payments. No proof was offered that the plaintiffs had paid Gestion Multi-Finance or Services Administratif S.B. the sums claimed. On the central statutory question, the court adopted the reasoning of Justice Denis Paradis in Desmarais c. Gestion Multi-Finance inc., 2026 QCCQ 386, holding that the pre-amendment version of section 70 was non-exhaustive because of the word "notamment," and that suretyship fees were already captured as credit charges before the 2024 amendment codified this expressly. Adding suretyship fees to the 23.75% declared rate brought the real credit rate to more than 50%, which the contracts failed to disclose. Because the plaintiffs, as sureties, held no greater rights than Gestion Multi-Finance itself, they were exposed to the same defences that could have been raised against the original lender.

Ruling and overall outcome

The court declared the underlying loan contracts between Himi and Gestion Multi-Finance null due to non-compliance with the Consumer Protection Act's credit-charge disclosure requirements. As the plaintiffs' claims as sureties depended entirely on those now-null contracts, both actions were dismissed in their entirety. Neyl Yanis Himi was the successful party, and the plaintiffs, Garantie d'Amérique inc. and 9442-4553 Québec inc., were ordered to pay court costs, with no monetary amount specified for those costs in the judgment.