Sigounis c. Sigounis | Mar 18, 2022

Sigounis c. Sigounis

2022 QCCS 965

SUPERIOR COURT

(Commercial Division)

CANADA

PROVINCE OF QUÉBEC

DISTRICT OF MONTRÉAL

No.:

500-11-052150-170

DATE: March 18, 2022

_____________________________________________________________________

BY THE HONOURABLE MICHEL A. PINSONNAULT, J.S.C.

_____________________________________________________________________

DIMITRIOS (JIMMY) SIGOUNIS

Plaintiff

v.

NICOLAS (NICHOLAS) SIGOUNIS

and

ARGYRO SIGOUNIS

Defendants

and

ELENI MAKRIDIS (SIGOUNIS), ès qualités Liquidator of the Estate of the Late Nicolas

Sigounis and ès qualités designated Particular and Universal Legatee in virtue of the

Last Will and Testament of the Late Nicolas Sigounis and subject to the decision to

exercise an option with respect to the Estate of the Late Nicolas Sigounis

Defendant in Continuance of suit

and

AMALIA SIGOUNIS

and

114753 CANADA INC.

and

114754 CANADA INC.

and

136585 CANADA INC.

and

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PAGE: 2

CHENOY DELICATESSEN & STEAK HOUSE INC.

and

CHENOY DELICATESSEN & STEAK HOUSE (1976) LTD.

and

CHENOY FOOD NETWORK INC.

and

N.K.D.S. CONSULTANTS & INVESTMENTS INC.

Mises-en-cause

_____________________________________________________________________

JUDGMENT ON OPPRESSION REMEDY APPLICATION

(Sections 241 and following of the Canada Business Corporations Act and

Sections 450 and following of the Business Corporations Act (Québec))

_____________________________________________________________________

OVERVIEW

[1] Since 2017, the undersigned has been responsible for the case management of this

oppression remedy matter initiated by Plaintiff Mr. Dimitrios (Jimmy) Sigounis (“Jimmy¹”)

against his father Mr. Nicolas (Nicholas) Sigounis (“Nicolas”) and his sister Ms. Argyro

Sigounis (“Argyro”). They all hold various interests (direct or indirect) in the seven Mises-

en-cause corporations that will be described collectively as the “Chenoy Corporations”.

[2] Unfortunately, this case which tantamount, to all intents and purposes, to a major

family dispute, has been bogged down with multiple disagreements and conflicts that

generated countless motions on all sides thus preventing this commercial case from

progressing as quickly as it should have.

[3] Until now, the members of the Sigounis Family have not been able to resolve their

disagreements on an amicable basis. If anything, their family dispute has grown even

more acrimonious with the unfortunate passing of the patriarch Nicolas on August 29,

2020.

[4] On February 24, 2017, Jimmy filed an Originating Application for various forms of relief

and for liquidation and dissolution of corporations (the “Oppression Remedy

Application”) against his father and sister seeking various forms of relief and ultimately,

the liquidation and dissolution of the family owned Chenoy Corporations or what remains

of them.

¹The use of first or last names in the judgment is meant to lighten the text. It should not be construed as

a lack of respect for the individuals concerned.

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[5] Jimmy, holding a direct and indirect minority interest², contends that he has been the

object of oppressive manoeuvres and actions by his father Nicolas and his sister Argyro

to such an extent that there exists an irremediable conflict and impasse between himself,

his father and his sister who clearly hold diverging interests in the Chenoy Corporations,

more specifically, as it pertains to their management and operations.

[6] Under such circumstances, Jimmy believes that there are no more alternatives, and

effective or useful means to resolve the deadlock but to proceed with the liquidation and

dissolution of the Chenoy Companies, in order to sell their assets, satisfy their outstanding

debts and distribute the residuum among their shareholders.

[7] In April 2017, in response to Jimmy’s allegation in his lengthy Oppression Remedy

Application, Nicolas and Argyro filed a joint written contestation disputing his allegations

without providing any details. They added that since this was in part a family matter, they

did not wish to engage in a sterile debate over corporations, Mises-en-cause in the

present proceedings, which are either insolvable or worthless³.

[8] In that regard, Defendants were referring to the Mises-en-cause 114753 Canada Inc.

(“114753”), 114754 Canada Inc. (“114754”), 136585 Canada Inc. (“136585”), Chenoy

Food Network Inc. (“Chenoy Food Network”) and N.K.D.S. Consultants & Investments

Inc. (“NKDS”) who were, since some years already, all insolvable as defined under the

Bankruptcy and Insolvency Act⁴.

[9] The remaining two Mises-en-cause corporations offer a different perspective.

[10] Chenoy Delicatessen & Steak House (1976) Ltd. (“Chenoy DDO”) owns the real

estate property situated at 3616 Saint-Jean Boulevard, in Dollard-des-Ormeaux (the

“DDO Property”) and holds the shares of its wholly owned subsidiary, Chenoy

Delicatessen & Steak House Inc. (“DDO Restaurant”).

[11] DDO Restaurant leases the DDO Property from Chenoy DDO and has been

operating therein a 24-hour restaurant since the mid-1970s under the Chenoy’s banner.

[12] As a teenager, Argyro started working for DDO Restaurant, at her father’s

request, and has been working there ever since. She now manages the restaurant

operations.

[13] Notwithstanding their allegation that most of the Chenoy Corporations are

insolvent, Defendants Argyro and Nicolas concluded their Oral Defence by indicating their

2

The Court refers to a corporate chart of the Chenoy Corporations produced by Jimmy in support of his

proceedings, which is annexed to the present judgment for ease of reference.

³Paragraph 3 of Defendants’ Oral Defence of April 12, 2017.

⁴Paragraph 4 of Defendants’ Oral Defence of April 12, 2017.

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intention to purchase all of Jimmy’s shares in the Mises-en-cause at a value to be

determined by the Court on the basis of the evaluations provided by the parties.⁵

[14] Jimmy refuses to sell his shareholding interest in the Chenoy Corporations mainly

on the basis that the parties will never agree to a realistic value especially insofar as the

DDO Property is concerned, given that DDO Restaurant has been operating at a loss for

years. In his view, the only logical and equitable solution is the liquidation and dissolution

of all seven corporations.

[15] The Court understands that the following corporations are essentially inactive:

- 114753 (“Chenoy Laval”) used to own land and a building in Laval (the “Laval

Property”) that was leased to 114754 until its sale in 2015;

- 114754 operated a restaurant under the Chenoy’s banner (the “Laval

Restaurant”) until the sale of the Laval Property in 2015 at which time it also sold

the equipment used until then for the restaurant’s operations;

- Chenoy Food Network used to be the franchisor of franchise restaurants operating

under the Chenoy’s banner.

[16] NKDS owns a 33-acre real estate property in the Eastern Townships known as the

“Country House”. Everyone agrees that the property should be disposed of.

[17] 136585 is a holding company who owns, inter alia, 40% of Chenoy DDO.

[18] Chenoy DDO owns the DDO Property and leases the same to DDO Restaurant.

[19] DDO Restaurant actually operates a restaurant under the Chenoy’s banner in the

DDO Property.

[20]

The Chenoy’s restaurant operated by the DDO Restaurant was the first restaurant

founded by Nicolas and is now the last of more than a dozen restaurants chain that used

to operate under the Chenoy’s banner.

[21] For years, the Chenoy Corporations have been struggling financially to stay

financially afloat.

[22] The central issue with respect to Jimmy’s proposed liquidation and dissolution of

the Chenoy Corporations is twofold:

⁵Paragraph 6 of Defendants’ Oral Defence of April 12, 2017:

6. The Defendants agree and undertake to purchase all of Plaintiff’s shares in the Mises-en-cause at a

value to be determined by this Honorable Court on the basis of the evaluations provided by the parties;

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- Argyro wants to keep the DDO Restaurant intact and continue to operate the

same as she claims that her father always told her that it would be hers thus

implying that it would be given to her;

- However, the land belonging to Chenoy DDO upon which the restaurant is built

on Saint-Jean Boulevard is apparently worth millions of dollars, far more than

the value of the building housing the restaurant and the value of the commercial

business conducted therein, which according to Jimmy, has been losing money

for years.

[23] Jimmy believes that the dissolution and liquidation of DDO Chenoy with the sale

of the Chenoy Property should yield sale proceeds that exceed by far the value of the

restaurant business and of the relatively old building which, in all likelihood, may have to

be demolished given the significant size of the lot and its prime commercial location on

Saint-Jean Boulevard.

[24] In short, the liquidation and dissolution of all Chenoy Corporations would ensure

the disposition of all remaining corporate assets followed with the orderly distribution of

the liquidation proceeds to their creditors with any residuum to the shareholders whoever

they may be.

[25] On the other hand, as proposed by herself and her father in their Oral Defence, by

ordering the buy-out of Jimmy’s interest in the Chenoy Corporations, it would enable

Argyro to keep DDO Restaurant operating without any further “interference” from her

brother.

[26] However, the present exercise would likely be moot should the Court retain the

expert evidence produced by Argyro that was adduced at trial proposing that Jimmy

should not be entitled to receive any sums of money for his shares given his alleged level

of indebtedness to the Chenoy Corporations either personally or via his own corporations.

[27] Jimmy argued that, under the present circumstances, Defendants’ proposed

outcome is not realistic nor acceptable as it would only maintain the status quo to his

detriment and to the detriment of the other members of the Sigounis family, who also have

an interest as co-shareholders or purported co-shareholders of the Chenoy Corporations

including in the holding company 136585 who owns 40% of Chenoy DDO who in turn

owns 100% of DDO Restaurant.

[28] In a nutshell, the Court is called upon to determine, in light of Jimmy’s proven

allegations of oppression that are contested by Argyro, whether the liquidation and

dissolution of the seven Chenoy Corporations or anyone thereof should be ordered or

should the Court favour instead Argyro’s offer to purchase Jimmy’s interests in the

Chenoy Corporations.

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[29] Under the latter circumstance, the Court would have to determine the fair market

value of Jimmy’s shareholding interest which would also imply determining the date of

reference to establish such a value.

[30] However, for the reasons that follow, in the presence of repeated acts of blatant

oppression by:

- Nicolas who acted as if he was the sole shareholder and director of all Chenoy

Corporations with total disregard for the interest of Jimmy as a minority

shareholder and even as co-director; and by

- Argyro who by following blindly the instructions of her father that suited her very

well, thus placing herself in a situation of conflict of interests, demonstrated a total

indifference or her complete ignorance of her fiduciary duties as director of the

Chenoy Corporations, again with outright disregard for the interest of Jimmy as a

minority shareholder and even as co-director;

the Court can only come to one sensible, logical and equitable conclusion namely

that, to the exception of DDO Restaurant, the other six Chenoy Corporations all governed

by the CBCA must be liquidated and dissolved in order to initiate the realization of their

remaining assets with a Court-appointed Liquidator who shall then proceed, under the

Court’s supervision, to the orderly distribution of the realization proceeds.

[31] The foregoing does not necessarily imply that DDO Restaurant should not be also

liquidated and dissolved since the DDO Property is owned by Chenoy DDO that is to be

liquidated and dissolved, bearing in mind that the latter also owns 100% of the shares of

DDO Restaurant that should be disposed of as a result therefrom.

[32] However, given the fact that DDO Restaurant, Chenoy DDO wholly owned

subsidiary, is still in operation and given its questionable financial situation and profitability

as it will be more fully discussed hereafter, the Court finds it more prudent to seek the

opinion and recommendation of the Liquidator to be appointed pursuant to the present

judgment before making a final determination with respect to DDO Restaurant.

CONTEXT

THE SHAREHOLDING OF THE CHENOY CORPORATIONS

[33] As it will be discussed further later, ordering the buy-out of Jimmy’s interest in the

Chenoy Corporations will not resolve all the outstanding issues between the members of

the Sigounis Family in connection with those family-owned corporations.

[34] Jimmy is not the only one to hold interest, direct or indirect, in NKDS, 136585,

Chenoy DDO and in DDO Restaurant, in particular.

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[35] Given the number of corporations involved, as previously indicated, a corporate

chart prepared by Jimmy is annexed to the present judgment for a better visualization and

understanding of their respective shareholding.

[36] According to Jimmy, at the time of the filing of the Oppression Remedy Application,

the shareholding was as follows with the proviso that Argyro is disputing certain of the

percentages attributed to Jimmy in said chart⁶. The Court shall deal with that particular

issue later.

The shareholding in 136585 Canada Inc.

[37] At the time that the present legal proceedings were instituted, 136585 was held by

Nicolas (20%) and his three children Jimmy (40%), Argyro (20%) and Ms. Amalia

Sigounis (“Amalia”) (20%).

[38] Argyro is disputing Jimmy 40% shareholding in 136585 claiming that he only holds

a 30% interest with the same percentage being held by her father Nicolas instead of 20%.

[39] At all relevant times, Nicolas, Argyro and Jimmy were the directors of 136585.

The shareholding in Chenoy DDO

[40] At the time that the present legal proceedings were instituted, Nicolas personally

held 60% of the shares of Chenoy DDO.

[41] The other 40% is held by the holding company 136585 through which Jimmy

derives his own interest.

[42] At all relevant times, Nicolas, Argyro and Jimmy were the directors of Chenoy

DDO.

The shareholding in DDO Restaurant

[43] DDO Restaurant is the wholly owned subsidiary of Chenoy DDO.

[44] At all relevant times, Nicolas, Argyro and Jimmy were the directors of DDO

Restaurant until Jimmy resigned as director in 2016 after discovering irregularities in the

handling of the GST/QST.

[45] Jimmy testified that his resignation was provoked by his discovery via the

accountant of DDO Restaurant that the restaurant was issuing fictitious invoices to offset

the GST/QST due to the tax authorities. He was nevertheless told not to worry as director

⁶The Court shall use the present tense when the shareholding of a corporation has not changed since the

filing of the Oppression Remedy Application in 2017.

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because Argyro would look after it if the ARQ reacted adversely. Jimmy did not want to

take any chance in that respect.

[46] The Court can appreciate Jimmy’s reacting with caution given his personal liability

to the ARQ was triggered for unpaid taxes as director of 114753 who used to own the

Laval Property.

[47] DDO Restaurant owns 50% of the shares of Chenoy Food Network.

The shareholding in Chenoy Food Network

[48] Chenoy Food Network was the franchisor of the franchise restaurants operating

under the Chenoy’s banner.

[49] The remaining 50% shares in Chenoy Food Network are held by 114754 who used

to operate the Laval Restaurant.

[50] At all relevant times, the directors of Chenoy Food Network were Argyro and

Jimmy.

The shareholding in 114754 Canada Inc.

[51] 114754 was held by 136585 (40%) and by Nicolas personally (60%).

[52] Until the sale of its movable assets (restaurant equipment) in July 2015⁷, 114754

operated the Laval Restaurant under the Chenoy’s banner at the Laval Property situated

at 355, Boulevard Curé-Labelle in Laval.

[53] 114754 leased the Laval Property from 114753.

[54] At all relevant times, the directors were Nicolas and Jimmy. Argyro testified that

she was a director of 113753 and 113754 until July 14, 2015, when the consultant hired

by her father told her to resign, which ultimately left her brother Jimmy to deal with the tax

liabilities of those two corporations.

The shareholding in 114753 Canada Inc.

[55] Until the sale of July 13, 2015⁸, 114753 owned the Laval Property situated at 355,

Boulevard Curé-Labelle in Laval and leased the same to 114754 to operate the Laval

Restaurant.

[56] The directors were Nicolas and Jimmy, Argyro having resigned on the following

day July 14, 2015, to avoid tax liabilities resulting from the sale.

⁷CP-8A.

⁸CP-8B.

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The shareholding in N.K.D.S. Consultants & Investments Inc.

PAGE: 9

[57] Jimmy and his father owned the shares issued by NKDS in the respective ratio of

25% and 75%.

[58] Following the Costas Buy-out (as defined hereafter) and pursuant to the

Acknowledgment⁹(as defined hereafter), Jimmy claimed that he became a shareholder

of NKDS with 33^1/3% from 25% and his father owning 66^2/3% from 75%.

[59] At all relevant times, Nicolas, Argyro and Jimmy were the directors of NKDS.

[60] NKDS owns the 33-acre Country House in the Eastern Townships that should be

sold, an outcome that does not constitute an issue herein.

THE PASSING OF NICOLAS, THE PREVIOUS TRANSFER OF HIS SHARES

TO HIS DAUGHTER ARGYRO IN DECEMBER 2019 AND HER MOTHER

ELENI’S INVOLVEMENT IN THE PRESENT LITIGATION

[61] This case is further complicated by the following additional facts and events that

occurred after the filing of the Oppression Remedy Application.

[62] From the outset of the present proceedings, Nicolas, as co-defendant, sided with

and supported the position of his daughter Argyro, preferring a buy-out of Jimmy’s interest

as opposed to liquidating and dissolving the Chenoy Corporations, hence their joint Oral

Defence.

[63] Around 2002, Nicolas suffered a serious health issue that ultimately, kept him

significantly incapacitated physically. Over the following years, his health deteriorated

essentially confining him at home with his wife Eleni.

[64] Argyro started assuming a greater role in the management and in the defence of

the present proceedings, but always under the guidance and directions of her father.

[65] Nicolas passed away on August 29, 2020, which caused his widow Madam Eleni

Makridis Sigounis (“Eleni”) to file on January 7, 2021, a Notice of Continuance of suit in

her capacity as Liquidator (“Liquidator”) of her late husband’s Estate (the “Estate”)

pursuant to Article 200 of the Code of civil procedure (“C.c.p.”), which incidentally, was

not opposed by Argyro nor by Jimmy.

[66] To compound the already complicated relations among the Sigounis family

members, the passing of the patriarch Nicolas has further entangled this family saga when

his widow Eleni, not only as Liquidator of the Estate but also as her husband’s universal

legatee in virtue of his Last Will and Testament¹⁰(“Universal Legatee”), realized with the

⁹P-26.

¹⁰DIC-1.

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assistance of counsel that the Estate was, to all intents and purposes, insolvent as a

result of a recent transaction in virtue of which Nicolas transferred to his daughter Argyro

his most valuable assets, namely his entire shareholding in the Chenoy Corporations,

leaving his wife with no money to satisfy the significant debts and liabilities of her late

husband.

[67] Even in her capacity as Defendant in continuance of suit as Liquidator (“DICS¹¹

Eleni”), Argyro refused to provide her mother any of the documentation evidencing the

alleged transfer to her of the shares that her father held in the Chenoy Corporations (the

“Shares”).

[68] On March 12, 2021, Argyro’s refusal left the Court with no other alternative but to

order her to produce the documentation evidencing the transaction that took place

between her father and herself. Argyro via her then lawyer not only steadfastly objected

to produce said information and documentation to her mother Eleni despite the fact that

she was the Liquidator and Universal Legatee of her late husband, but also to her brother

Jimmy as Plaintiff who had sued his father in the present instance as a shareholder and

director.

[69] In compliance with the March 12, 2021, Order, Argyro’s counsel at the time,

namely, M^treDavid Rosenzveig¹², finally communicated to the counsel for DICS Eleni the

following documents:

a. Document entitled “Confirmation Share Transfer Between Sigounis Nicholas

and Sigounis Argyro” dated December 8, 2019 (“Confirmation #1”);¹³

b. Document entitled “Confirmation Share, Advances and Other Agreements

Between Sigounis Nicholas and Sigounis Argyro” also dated December 8, 2019

(“Confirmation #2”)¹⁴.

[Confirmation #1 and Confirmation #2 to be referred to collectively hereinafter as

the “Confirmations”]

[70] At trial, it was disclosed that Argyro proceeded unilaterally to make on her own all

the modifications with the Registraire des entreprises du Québec (“REQ”) to reflect the

situation following the transfer of the Shares, without informing Jimmy or seeking his

consent as director of the corporations affected by such transfer.

[71] With the Confirmations finally on hand, Plaintiff Jimmy and DICS Eleni with the

assistance of her counsel, discovered that a few months before his passing, Nicolas had

transferred to his daughter Argyro all the Shares that he held in the Chenoy Corporations

¹¹Defendant In Continuance of Suit (DICS).

¹²M^treRosenzveig was substituted shortly thereafter.

¹³DIC-8A.

¹⁴DIC-8B.

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for a consideration that, in the opinion of Jimmy and of DICS Eleni, was significantly below

their fair market value.

[72] The Shares held until then by Nicolas gave him, inter alia, an overall 68% to 72%

interest in 136585 and DDO Chenoy (DDO Property) and a 66^2/3% to 75% interest in

NKDS¹⁵.

[73] They also concluded that Argyro failed to pay the declared consideration in the

Confirmations for the Shares as the necessary corporate resolutions were never passed

at the time and that in so doing, the Late Nicolas also transferred to Argyro certain shares

that he held for the benefit of his son Jimmy, which constituted in the latter’s view, another

act of oppression against him.

[74] DICS Eleni’s further investigation of the Estate affairs with the assistance of

counsel revealed the existence of several unresolved lawsuits involving the Late Nicolas

thus exposing the Estate to significant potential liabilities that could not be honoured

without the liquidation proceeds of the Shares that were transferred to his daughter Argyro

a few months before his passing.

[75] DICS Eleni’s counsel argued that with those Shares, the Late Nicolas was to all

intents and purposes, directly and indirectly, the main or controlling shareholder of the

Chenoy Corporations and as such his Shares were his most important assets that were

to provide, inter alia, some security to his wife after his passing. His daughter Argyro could

not ignore that the transfer of the Shares that occurred allegedly on December 8, 2019,

rendered her father the Late Nicolas insolvent under such circumstances. In other words,

with the assistance of his daughter, Nicolas also ensured that he would become

“judgment proof” vis-à-vis the ongoing lawsuits against him.

[76] At trial, Argyro admitted knowing about his father’s financial situation at the time of

the transfer of his Shares. He wanted to protect himself because of the ongoing lawsuits

against him. He told me what to do.

[77] Argyro added that her father told her that by transferring his Shares to her, his

creditors would not be able to collect.

[78] However, as incredible as it may seem, despite being aware of the lawsuits against

her father, Argyro pointed out that at no time did she understand that her father was facing

serious indebtedness.

¹⁵Depending on whether Jimmy holds 30% or 40% of the shares issued in 136585 following the

execution of the Acknowledgment by his father in the context of the Costas Buy-out (kindly refer below to

section 3.8 The Costas Buy-out of February 2016).

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[79] When confronted with the fact that the only asset of real value left was the DDO

Property, without it her mother could not contemplate settling her late husband’s debts,

leaving a totally insolvent Estate, Argyro claimed that I never thought of it. I don’t know.

[80] Although she benefitted from the proceeds of one life insurance policy, DICS Eleni

was facing a serious predicament for a person who always believed that her late husband

had taken the necessary steps to ensure her financial security after his passing. Even her

personal residence has been heavily mortgaged ($760,000¹⁶) before her husband’s

passing to cover, inter alia, a variety of debts and liabilities linked to the Chenoy

Corporations.

[81] Without the Court expressing any opinion at this juncture on the validity, the legality

and the opposability of the Confirmations evidencing the December 8, 2019, transfer of

the Shares to his daughter Argyro, DICS Eleni who is not only the Liquidator of the Estate

but also the Universal Legatee, also realized that she was not in a position to properly

deliberate and exercise the option to accept the succession of her late husband with the

significant risks presently associated with an insolvent Estate.

[82] On February 17, 2021, Justice Hélène Langlois granted Eleni’s Application and

ordered the suspension of the six-month delay to deliberate and exercise the option with

respect to the Estate¹⁷.

[83] Justice Langlois also ordered that suspension shall remain in force and effect until

a final judgment is rendered in the present Superior Court dossier bearing number 500-

11-052150-170 and in the Superior Court dossier bearing number 500-17-111490-200

which is a lawsuit instituted by Jimmy before Nicolas’ passing claiming from his father

$190,975.13 in connection with a guarantee the he granted to Nesbitt Burns on behalf of

his father to cover his investment portfolio (the “Nesbitt Burns Lawsuit”). As Nicolas was

in default to pay to Nesbitt Burns the said sum of money, the same was debited from

Jimmy’s own investment portfolio as he had guaranteed his father’s obligations to Nesbitt

Burns.

[84] Since then, DICS Eleni amended her Notice of Continuance of suit claiming to act

herein not only in her capacity as Liquidator but also in her capacity as Universal Legatee

who has not yet opted for the reasons stated above.

[85] DICS Eleni also filed a written Defense as well as a Cross-Application as

Defendant in continuance of suit of the Late Nicolas with conclusions against Argyro

seeking, inter alia and with Jimmy’s support, the cancellation of the Confirmations, and

the appointment of a liquidator to NKDS, 136585 and Chenoy DDO who hold interest in

the remaining real estate assets of the Chenoy Corporations, in order to put up for sale

the Country House and the DDO Property.

¹⁶P-25.

¹⁷DIC-6.

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[86] Although DICS Eleni is not seeking the liquidation and dissolution of all seven

Chenoy Corporations¹⁸, in contrast with Defendant Nicolas’s initial joint Oral Defence with

Argyro, DICS Eleni is essentially in agreement with her son Jimmy’s proposed relief

sought in that regard given that she now has the duty to liquidate the Estate. Should she

successfully retrieve the Shares of her late husband, the same would have to be disposed

of in order to satisfy the debts and liabilities of the deceased.

[87] In other words, despite his mother’s precarious standing in the present

proceedings, Jimmy is no longer the only one seeking the liquidation and dissolution of

the Chenoy Corporations, in whole or in part.

[88] DICS Eleni’s counsel argued that should her late husband’s Shares revert back to

the Estate, the only sensible and equitable solution available to his client was to liquidate

and dissolve 163685, DDO Chenoy (DDO Property) and NKDS (Country House) in order

to dispose of the remaining real estate assets that are of significant value and that would

enable Eleni as Liquidator to address and deal with her late husband’s debts and

liabilities.

[89] DICS Eleni’s counsel added that under such a scenario, given the exceptional

value of the DDO Property in particular, the prospects that the Estate would likely

generate a surplus in favour of his client in her capacity as Universal Legatee were

reasonably good.

[90] During her testimony, Eleni confirmed that position indicating that she also wanted

that her share of the net realization proceeds¹⁹of those remaining assets be ultimately

shared equally between her three children.

[91] In addition to her Defense and Cross-Application, DICS Eleni filed on May 31,

2021, a Declaration of Intervention of Defendant in continuance of suit (the

“Intervention”) pursuant to article 185²⁰C.c.p. in virtue of which she is seeking:

- A judicial declaration that the Confirmations both dated December 8, 2019, are

cancelled, null and void and unopposable against her;

- A judicial confirmation that:

o DICS Eleni holds a 60% shareholding interest in Chenoy DDO;

- A judicial confirmation that:

¹⁸The Court understands that 114753, 114754 and Chenoy Food Network are inactive and insolvent.

¹⁹After her late husband’s debts and liabilities have been settled.

²⁰185. Voluntary intervention is termed aggressive when the third person seeks to be acknowledged as

having, against the parties or one of them, a right which is in dispute. It is termed conservatory when the

third person wishes to be substituted for one of the parties in order to represent it, or to be joined with one

of the parties in order to assist it or support its claims. A third person is said to intervene as a friend of the

court when seeking only to participate in argument during the trial.

A third person who intervenes for aggressive or conservatory purposes becomes a party to the proceeding.

500-11-052150-170

o 136585 owns a 40% shareholding interest in Chenoy DDO;

PAGE: 14

o Plaintiff Jimmy owns a 40% shareholding interest in 136585;

o DICS Eleni owns a 20% shareholding interest in 136585;

o Defendant Argyro owns a 20% shareholding interest in 136585; and

o Mise-en-Cause Amalia owns a 20% shareholding interest in 136585.

- A judicial confirmation that:

o DICS Eleni owns a 66^2/3% shareholding interest in NKDS; and

o Plaintiff Jimmy owns a 33^1/3% shareholding interest in NKDS;

- Authorization to mandate a Certified Real Estate Broker to sell the immovable

properties belonging to Chenoy DDO and to NKDS for a price commensurate

with their fair market value; and

- An order to join her Declaration of Intervention together with the Oppression

Remedy Application which was fixed for proof and hearing on the merits

commencing on October 13, 2021.

[92] Although more detailed, the conclusions of the Intervention are essentially the

same ones found in DICS Eleni’s Defense and Cross-Application.

[93] On June 30, 2021, Jimmy instituted a Paulian Action²¹against his sister Argyro

and his mother Eleni in her capacity as Liquidator of the Estate of his father the Late

Nicolas.

[94] With his Paulian Action, Jimmy is seeking a declaration that the Confirmations may

not be set up against him and are not opposable to him.

[95] Jimmy is also asking for a declaration of nullity of the transfer of 8.33 shares of the

capital stock of NKDS and 100 shares of the capital stock of 136585 that were likely part

of the transaction of December 8, 2019, between Nicolas and Argyro pursuant to the

Confirmations.

[96] Jimmy and DICS Eleni sought that the Intervention, the Cross-Application and the

Paulian Action be joined to the Oppression Remedy Application and be heard and

disposed of at the same hearing that was scheduled to commence on October 13, 2021.

[97] Argyro contested said applications to join the Paulian Action and the Intervention

as well as DICS Eleni’s legal interest and capacity to file the Cross-Application and the

Intervention.

[98] Argyro also disputed the jurisdiction of the Court to hear the matters and the issues

raised in the Cross-Application and in the Intervention with respect to the Confirmations

²¹500-17-117432-214 (the “Paulian Action”).

500-11-052150-170

PAGE: 15

and the Shares of the Late Nicolas given the arbitration clauses found in the

Confirmations.

[99] Needless to say, this protracted family saga that has been unfolding for some five

years, cannot reach a much-needed complete resolution with a judgment ordering the

liquidation and dissolution of the Chenoy Corporations, as it will not completely settle the

issue of the transfer of Nicolas Shares to Argyro raised by Eleni, who claims to be the

rightful owner of said Shares as Universal Legatee.

[100] Be that as it may, on October 6, 2021, the Court rendered the following judgment:

[141] DISMISSES the Application of Defendant Argyro Sigounis to dismiss the

Amended Defense and Cross-Application of Defendant in Continuance of suit, and

to dismiss the Declaration of Intervention of Defendant in Continuance of suit dated

August 2, 2021;

[142] DISMISSES the Modified Application of Defendant Argyro Sigounis to refer

the parties to arbitration dated July 14, 2021;

[143] DECLARES that Defendant in Continuance of suit Eleni Makridis (Sigounis)

ès qualités designated Particular and Universal Legatee in virtue of the Last Will

and Testament of the Late Nicolas Sigounis and subject to the decision to exercise

an option with respect to the Estate of the Late Nicolas Sigounis, has the sufficient

interest to intervene in the present instance in that capacity in addition to her

capacity as Liquidator of the Estate of the Late Nicolas Sigounis;

[144] DECLARES that Defendant in Continuance of suit Eleni Makridis (Sigounis)

ès qualités designated Particular and Universal Legatee in virtue of the Last Will

and Testament of the Late Nicolas Sigounis and subject to the decision to exercise

an option with respect to the Estate of the Late Nicolas Sigounis, can validly file

the Re-Amended Defense and Cross-Application of Defendant in Continuance of

suit dated August 11, 2021, as well as the Amended Declaration of Intervention of

Defendant in Continuance of suit dated August 11, 2021, which for the purposes

hereof shall be considered as one and the same with the Re-Amended Defense

and Cross-Application given their similar allegations and conclusions;

[145] To the extent necessary, ORDERS the joinder of the Amended Declaration

of Intervention together with the Introductory Application in the present instance to

be heard on the merits commencing on the October 13, 2021;

[146] ORDERS the joinder of the Paulian Action in case bearing number 500-17-

117432-214 together with the Introductory Application in the present instance to

be heard on the merits commencing on the October 13, 2021;

[147] CALLS upon the parties’ counsels to attend a virtual preparatory conference

on Friday, October 8, 2021, at 9 a.m. with coordinates to be provided

subsequently;

500-11-052150-170

PAGE: 16

[148] ORDERS the provisional execution of the present Judgment notwithstanding

appeal therefrom;²²

[101] On October 8, 2021, the Court also ruled as follows with respect to the trial

scheduled to commence on October 13, 2021:

Le Tribunal CONCLUT que le procès débutera par le recours en oppression qui

est la requête initiale (# 1), suivis de la contestation et demande reconventionnelle

de Mme Argyros Sigounis (# 64) qu’il considère être à l’intérieur du débat soulevé

par la demande principale en oppression.

[102] In other words, the Court would deal with the other issues raised in the Cross-

Application/Intervention and in the Paulian Action in a separate hearing to be held at an

undetermined date depending on the outcome of the Oppression Remedy Application.

[103] The order to proceed to the liquidation and dissolution of the Chenoy Corporations

will allow the Court to deal with the aforesaid outstanding issues during the liquidation

process in order to enable the Court-appointed Liquidator to remit the net realization

proceeds to their rightful holders or beneficiaries.

THE ACTS OF OPPRESSION RAISED BY PLAINTIFF JIMMY

Preliminary comment

[104] As a preliminary comment, the Court has already mentioned that Jimmy was the

object of blatant acts of oppression by his father and sister.

[105] The Court noted that the corporate documentation for the family owned, and

family-run corporations was the least of the preoccupations of Nicolas and of Argyro who

did not hesitate to raise the absence of the necessary resolutions or documentation

against her brother when it suited her purposes at trial.

[106] Be that as it may, the operation and management of the Chenoy Corporations in

such an informal and loose manner may have suited everyone’s purpose while all of the

Sigounis family members were in agreement and were entertaining cordial relations.

[107] However, with the severe discord developing between the family members who

held shareholders’ interest in the Chenoy Corporation, the previous conduct of loose

management did not confer upon Nicolas and Argyro as directors the licence or the right

to carry on in the same manner and act in an oppressive or an unfairly prejudicial manner

towards a minority shareholder who happened to be also a co-director of those

corporations.

²²2021 QCCS 4185.

500-11-052150-170

PAGE: 17

[108] Being aware of their disagreements with Jimmy, Nicolas and Argyro could not

simply act as if Jimmy was no longer a co-director with them and make crucial corporate

decisions in his absence and without his knowledge and consent.

[109] With all due respect, Nicolas may have been the founder of the group of Chenoy

Corporations, but he decided at one point to operate his business in a corporate

environment. Such an environment certainly provided significant advantages to the

shareholders, but it also came with obligations and duties especially for the directors.

[110] Nicolas and Argyro breached on several occasions their fiduciary duty as directors

to the detriment of Jimmy as co-director and minority shareholder. With respect to Nicolas,

there are instances where with the assistance and complicity of Argyro, he gave

instructions to Chenoy’s corporate counsel without the directors’ approval and knowledge

on the basis that he was the controlling shareholder.

[111] Under such circumstances, as frustrating as it may have been for him, Nicolas

could not act and decide as if he was the sole shareholder and director.

[112] With respect to Argyro, claiming to be unfamiliar with or unaware of her fiduciary

duty as director cannot be set up as a defence nor could she successfully invoke the fact

that her actions were always dictated by her father as she was executing his will by

carrying out his instructions.

Jimmy Sigounis’ call for restructuring the Chenoy Corporations

[113] Jimmy, the son of Nicolas and Eleni, is a businessman who is involved in the food

industry via his principal venture Mello Foods Inc. (“Mello”). His shares in Mello came

from his father many years ago.

[114] At all relevant times, Nicolas no longer had any interest in Mello who was supplying

meat products to the Chenoy’s restaurants over the years until the breakdown in their

relationship.

[115] Although he was not directly involved in the operations of the Chenoy’s

restaurants, Jimmy nevertheless kept a direct and indirect interest in several of the

Chenoy Corporations and sat on most if not all of their board of directors.

[116] With his father’s failing health, he responded to his every call for assistance until

their relationship soured.

[117] On September 21, 2012, Jimmy proposed a restructuring plan for Chenoy

Corporations to his father Nicolas, his two sisters Argyro and Amalia and to his uncle

Costas (Costa) Sigounis (“Costas”) pursuant to which he also proposed to assume the

leadership of the corporations to bring them back to profitability:

500-11-052150-170

PAGE: 18

Being at the crossroad, I believe that it is important to know where we come from,

where were we as a group, where are we now and where we need to go!

For many years, the “Chenoy’s” concept was profitable, and it was supported by a

solid balance sheet. The strength of the leader (Nick) with his team, guided by his

vision of business brought the concept to a certain level up to the moment that his

health started to deteriorate.

Unfortunately, when that occurred, there was no backup plan in place, and we are

where we are today; in a nonprofitable situation and all divided. Figures speak by

themselves and there is no shame to say that the system that Nick has built over

the years is now today a total failure.

There is no franchise system in place; there is no more consistency toward over

services, quality, advertising, and image, policies etc... and most important of all,

no positive results! All corporate stores had drifted away from what a franchise

system is all about!

We must all realize and understand that a restructuration must take place now and

if we refuse to face this reality on a timely matter, by appointing a new leader who

will oversee ALL operations, we will suffer the consequence and there will be

severe collateral damages.²³

[Emphasis added]

[118] In retrospect, Jimmy’s assessment of the situation at the time and his

apprehensions in the absence of a sound restructuring plan, unfortunately proved to be

right.

The Costas Sigounis oppression remedy lawsuit and the closing of the

Brossard and Laval Restaurants

[119] By the end of 2013, nothing had changed.

[120] As previously mentioned, 114753 owned the Laval Property that was leased to

114754 who operated the Laval Restaurant.

[121] Nicolas’ brother, Costas was handling the management and operations of that

restaurant.

[122] Following a falling out with his brother Nicolas, Costas who wanted to withdraw

from the Chenoy Corporations, instituted on November 8, 2013, oppression remedy

proceedings in November 2013 essentially seeking the liquidation and dissolution of the

same²⁴.

²³CP-01.

²⁴500-11-045606-130 (the “Costas Oppression Lawsuit”).

500-11-052150-170

PAGE: 19

[123] The case was ultimately settled out of court in the following context.

The Costas Agreement of December 5, 2013

[124] On December 5, 2013, a Memorandum of Agreement was entered into between

Costas, Nicolas, Jimmy, Chenoy DDO, DDO Restaurant, 114753 (Laval property),

114754 (Laval Restaurant) and NKDS²⁵(the “Costas Agreement”).

[125] The Costas Agreement was reached following meetings that involved the Sigounis

family members and their lawyers including Argyro and Amalia. It confirmed and

evidenced the parties’ agreement that it constituted a transaction that could be

homologated by the Court.²⁶

[126] Jimmy explained that, year after year, the Chenoy’s restaurants were losing

money. They had to mortgage their remaining real estate properties to replenish the

companies’ cashflow. As their businesses were no longer profitable, the Costas

Agreement evidenced their collective will and decision to liquidate the Chenoy

Corporations instead of spending money in court to contest Costas Oppression Lawsuit.

[127] The main purpose of the Costas Agreement was to agree on an orderly winding

up of the affairs and operations of the Chenoy Corporations which involved, inter alia, the

liquidation of the assets of Chenoy DDO (DDO Property), DDO Restaurant, Chenoy Food

Network, 114753 (Laval Property), 114754 (Laval Restaurant), NKDS (Country House)

and the holding company 136585.

[128] This agreed upon outcome would ensure that together, with all the other interested

shareholders, Costas would receive his share of the net liquidation proceeds

commensurate to his then shareholding interest.

[129] The parties also agreed to mandate a real estate broker to sell the Laval Property

and the DDO Property and ultimately close the two restaurants.²⁷Any and all Sigounis

family members were free to make offers to acquire any of the said properties should they

so desire.²⁸

[130] The parties also agreed to sell the Country House owned by NKDS with an asking

price of $500,000 and a minimum selling price of $450,000.²⁹

²⁵P-2.

²⁶Clause 7 of the Costas Agreement.

²⁷Clause 5a) of the Costas Agreement.

²⁸Ibid.

²⁹Ibid., clause 5g).

500-11-052150-170

The failed attempts to sell the DDO Property in 2014

PAGE: 20

[131] In furtherance of the Costas Agreement, the DDO Property was put up for sale³⁰.

Jimmy pointed out that offers were received in March 2014 and that they came close to

making a deal with a $2.8M offer payable in full without any conditional financing³¹, but

Nicolas refused to give his consent.

[132] The Court understands that Jimmy as a director of Chenoy DDO was unaware at

the time of two other offers made by his sister to her father to purchase the DDO Property.

It is not clear whether Nicolas ever accepted those offers.

[133] On February 5, 2014, Argyro offered to purchase the DDO Property from Chenoy

DDO for an amount of $2.4M without making any deposit.³²Argyro was proposing to pay

the purchase price of $2.4M with a “down payment” of $912,000 at closing, being a

contribution of Nick Sigounis to Argy Sigounis for the share of the Property as always

promised. Nine Hundred and Twelve thousand dollar ($912,000).³³

[134] The offer was also subject:

- to obtaining a hypothecary financing of $525,000; and

- to Chenoy DDO accepting a balance-of-sale price of $963,000 payable in five

years; and

- Argy S. will redeem her share or deemed held shares in both companies at DDO

(i.e. the building and operating company).³⁴

[135] On February 28, 2014, Argyro made another offer to Chenoy DDO in the amount

of $2.7M again without any deposit, payable with $945,000 at closing and subject to a

hypothecary financing of $1,755,000.³⁵

[136] Offers from third parties were also received for the DDO Property in March 2014

with prices ranging from $1.9M to $2.8M³⁶as previously mentioned.

[137] The Court is unaware of other attempts to sell the DDO Property in 2014. However,

other offers were received in late 2016 as it will be more fully discussed later.

³⁰CP-21.

³¹P-32, pages 34-47.

³²Ibid., pages 11-19.

³³Ibid., page 18.

³⁴Ibid., page 22.

³⁵Ibid., pages 24-32

³⁶P-32.

500-11-052150-170

PAGE: 21

The sale of the Laval Property and the equipment of the Laval

Restaurant in 2015.

[138] In accordance with the Costas Agreement, the efforts to find a buyer for the Laval

Property were more fruitful.

[139] On July 13, 2015, 114753 sold the Laval Property for $2M³⁷and 114754 sold the

equipment of its restaurant for $200,000³⁸.

[140] The net proceeds of $1,674,100 were deposited in a trust account controlled by

lawyer Denis Kounadis (“Kounadis”) who, at all relevant times, acted as corporate

counsel for the Chenoy Corporations.

[141] The sizable profit induced Nicolas to use the net proceeds to cover various debts

thus raising Jimmy’s serious concerns about holding unto sufficient funds to cover all tax

liabilities stemming from the sales, bearing in mind that Jimmy and his father were the

sole remaining directors of both corporations that they had just sold all of their respective

assets. Argyro had resigned as director of both corporations on July 14^th,the day following

the completion of the sales in question to avoid potential director’s liability to the tax

authorities resulting therefrom.

[142] Nicolas had different priorities than Jimmy’s. He decided to buy out immediately

his brother Costas for $425,000 with a portion of the net sale proceeds. He also decided

to use another $450,000 to pay the outstanding mortgage on his family residence on

Marlatt Street in Montreal (the “Marlatt Property”) that was registered in his wife Eleni’s

name only.³⁹

[143] By the end of 2015, the Marlatt Property belonging to Eleni was mortgage free.

[144] Unfortunately, sufficient funds were not retained at the time to cover the

outstanding taxes due by 114753 and 114754 stemming from the sales.

[145] Following the sale of the Laval Property (114753) owned one third by Jimmy and

two thirds by Nicolas, the capital gain generated was not paid and Jimmy as sole

remaining director, is still personally responsible for the payment of the same to the

Agence du revenu du Québec (“ARQ”)⁴⁰.

The closing of the Brossard Restaurant in 2015

[146] The year 2015 also saw the closing of the Chenoy’s restaurant located in Brossard

on the South Shore of Montréal (the “Brossard Restaurant”).

³⁷CP-08B.

³⁸CP-08A.

³⁹P-33 and P-34.

⁴⁰P-28.

500-11-052150-170

PAGE: 22

[147] The Brossard Restaurant was operated by 2959-8455 Québec Inc. from 1992 until

its bankruptcy in 2015.

[148] The shareholders of 2959-8455 Québec Inc. were Nicolas and his daughter Amalia

who was responsible for the restaurant’s operations. Nicolas was the sole director.

[149] The closing and bankruptcy of the Brossard Restaurant triggered lawsuits

involving, inter alia, Nicolas that are still pending, including legal proceedings instituted

by the ARQ regarding notices of assessment totalling $863,417 for failure to report all

sales and gratuities (tips) remit the deductions at source (DAS), GST and QST since

2008⁴¹.

[150] The landlord of the Brossard Restaurant also has a significant claim in excess of

$1M against Nicolas as personal guarantor under the existing lease⁴².

[151] These cases are still active and pending.

[152] Amalia sought the protection of the Bankruptcy and insolvency Act with a proposal

to her creditors.

[153] The Court understands that despite owning shares (20%) in 136585, Amalia

ceased being involved with the Chenoy Corporations including their management and

operations and did not participate to the present hearings.

The Costas Buy-out of February 2016

[154] Following the sale of the Laval Property, Jimmy was against the immediate buy-

out of Costas’ interest in the Chenoy Corporations with the sale proceeds of the Laval

Property.

[155] Jimmy insisted that the Costas Agreement of December 2013 be respected which

also implied the sale of the DDO Property and the DDO Restaurant before the

shareholders could receive what was due to them out of the remaining net proceeds.

[156] Nicolas saw it in a different way. He preferred to use immediately a portion of the

net proceeds of the sale of the Laval Property to buy out his brother Costas against a

payment of $425,000 (the “Costas Buy-out”), which involved, inter alia, granting mutual

releases and discharge between the various members of the Sigounis family, including

Jimmy.

[157] On January 20, 2016, Jimmy’s lawyer advised Nicolas’s lawyer and Argyro that

his client would not partake in the Costas Buy-out. However, Jimmy would only agree to

participate in such a buyout if an agreement was reached with the other members of the

⁴¹DIC-20 (500-80-036795-186).

⁴²DIC-21 (500-17-090263-156).

500-11-052150-170

PAGE: 23

Sigounis family concerning the handling and disposition of the remaining assets of the

Chenoy Corporations in furtherance of the Costas Agreement.⁴³

[158] The outstanding issues which were to be dealt with and agreed to involved:

 The debt and liabilities of the 114753 (Laval Property) and the outstanding debts

and obligations of the Laval Restaurant operations and the resulting directors’

liability;

 The debts and obligations of DDO Restaurant and the resulting directors’ liability;

 The sale of the Country House in order to repay outstanding debts;

 The sale of the DDO Property and/or relocation of the DDO Restaurant;

 Stabilizing the Gatineau and Joliette franchises.

[159] In addition to the foregoing, Jimmy also objected to conclude the Costas Buy-out

with the sale proceeds of the Laval Property and to grant Costas a mutual release and

discharge, unless debts due to Mello Foods⁴⁴for supplying the restaurants were to be

paid in full, unless Jimmy received a portion of Costas shares and unless his father would

cover the shortfall (US$146,666.74) in his own Nesbitt Burns investment account that

Jimmy had guaranteed.⁴⁵At the time, Nesbitt Burns had not yet debited Jimmy’s

investment account to satisfy his father’s indebtedness to the investment company.

[160] On February 8, 2016, relying upon the assurances of Nicolas’s lawyer, Me

Kounadis, that a sufficient amount would be kept from the sale proceeds of the Laval

Property to cover the outstanding tax liabilities of 114753 and 114754 which had yet to

be determined precisely and that the DDO Property would be put up for sale again, and

that his father would make the necessary payment regarding his indebtedness to Nesbitt

Burns, Jimmy agreed to sign on his personal behalf and on behalf of Mello Foods, 136585

and of Chenoy Food Network, the Mutual Release requested by Costas who received

$425,000 for his shares (the “Costas Release”).⁴⁶

[161] Unfortunately, those assurances that induced Jimmy to sign the Costas Release

did not materialize. Nesbitt Burns ultimately collected the funds due by his father by

withdrawing $190,975.13 from Jimmy’s own investment account⁴⁷. This event caused

Jimmy to institute the Nesbitt Burns Lawsuit against his father on February 5, 2020, to

recover the sum of $190,975.13.⁴⁸

⁴³P-4, page 4.

⁴⁴For food and supplies extended to the Chenoy restaurants.

⁴⁵DIC-22.

⁴⁶P-7.

⁴⁷DIC-22.

⁴⁸Ibid., 500-17-111490-200 (the “Nesbitt Burns Lawsuit”).

500-11-052150-170

PAGE: 24

[162] With respect to the outstanding taxes due to the ARQ by 114753, Jimmy is

currently making payments personally to cover said corporate debts as the remaining

director.

The Acknowledgment signed by Nicolas on February 8, 2016

[163] On the same day that the Costas Release was executed, namely on February 8,

2016, Nicolas also signed in favour of Jimmy a document entitled “Acknowledgement”⁴⁹,

in virtue of which Nicolas acknowledged that:

In connection with that certain Share Purchase Agreement between Mr. Costas

Sigounis as Vendor and Nick as Purchaser dated February 8, 2016 (the “Share

Purchase Agreement”), into which Share Purchase Agreement intervened

N.K.D.S. Consultants & Investments Inc. (“N.K.D.S.”), Chenoy Food Network Inc.,

Chenoy Delicatessen & Steak House (1976) Ltd., Chenoy Delicatessen & Steak

House Inc., 114754 Canada Inc. (“Laval”), 136585 Canada Inc. («ꢀ136ꢀ585ꢀ»),

95735 Canada Inc., 9259-8455 Quebec Inc., Mona Lisa Advertising Ltd. (“Mona

Lisa”) and Aliments Mello Inc., the undersigned hereby agree as follows:

1. In respect of the purchase by Nick of 25 Class “A” Common Shares of N.K.D.S.,

300 Class “A” Common Shares of 136585 and 20 Class “A” Common Shares of

Mona Lisa (the “Purchased Shares”), Nick hereby acknowledges acquiring one

third (⅓) of the Purchase Shares in and for the benefit of Jimmy, who hereby

acknowledges that he shall be bound by the terms and conditions of the said Share

Purchase Agreement insofar as it pertains to the rights and obligations in and to

the Purchase Shares;

2. In respect of the purchase by Nick of certain advances made by Costa to

N.K.D.S. and Laval in the aggregate amount of One Hundred Sixty-Three

Thousand Nine Hundred and Eighty-Five Dollars ($163,985.00) (the “Advances”),

Nick hereby acknowledges having acquired one third (1/3) of the Advances in and

for the benefit of Jimmy, and Jimmy hereby acknowledges that he shall be bound

by the terms and conditions of the Share Purchase Agreement insofar as it pertains

to the rights and obligations in and to the Advances;

3. The parties shall execute such further agreements, transfers, instruments and

documents as may be necessary in order to give effect to the present

acknowledgment;

4. In particular and without limiting the generality of the foregoing, Nick shall

transfer to Jimmy, and/or as Jimmy may direct, to any company, trust and/or

nominee of Jimmy, one third (⅓) of the Purchase Shares and one third (⅓) of the

Advances at such time and to such person or entity as Jimmy shall direct.⁵⁰

[Emphasis added]

⁴⁹P-26.

⁵⁰Ibid.

500-11-052150-170

[the “Acknowledgment”]

PAGE: 25

[164] At trial, Argyro argued that the Acknowledgment was not binding as it was not

followed with the appropriate corporate documentation, bearing in mind that those shares

were allegedly part of the transfer by her father to her via the Confirmations, although the

same was not specifically mentioned therein. The Paulian Action instituted by Jimmy

addresses that particular issue among other things.

The NKDS/Marlatt hypothecary loan of July 14, 2016

[165] In June 2016, the Chenoy Corporations are experiencing financial difficulties. The

sale of the Laval Property, the bankruptcy of the Brossard Restaurant and its closing

together with the closing of the Laval Restaurant did not bring back the remaining

companies to a positive financial position.

[166] Mr. Michel Montmorency (“Montmorency”) acting as a consultant for Nicolas,

informed Jimmy that he had received instructions from Nicolas to secure financing by

hypothecating the Country House owned by NKDS, bearing in mind that Jimmy was a

director and a 33^1/3% shareholder pursuant to the Acknowledgment.

[167] Jimmy refused to consent to NKDS borrowing moneys against the Country House

under the prevailing circumstances to cover debts that did not concern that company.

[168] A meeting was called for on June 29, 2016, at Kounadis’ office that was

subsequently cancelled by Montmorency claiming to act on Nicolas’s instructions.

[169] In an email sent to Kounadis and to Jimmy’s lawyer, Montmorency reassured

everyone that no hypothecary loan would be granted by NKDS without “respecting the

procedure”:

Je suis désolé de ce contretemps pour la réunion, c’est hors de mon contrôle. En

effet la démarche effectuée dans le dossier de N.K.D.S. inc. a pour but de

protéger l’actif vulnérable et ne se veut en aucun moment être préjudiciable

envers les actionnaires.

Monsieur Nick m’a donné les instructions de rechercher un prêt afin de régler

certaines urgences et de sécuriser l’actif et ultimement de satisfaire son fils pour

sa participation dans la compagnie. Un travail laborieux fut effectué et la

conclusion est positive.

Par ailleurs, je peux vous confirmer que rien ne se produira sans avoir respecté

les procédures ou tout au moins avant notre rencontre de mardi prochain [July 5,

2016].

Salutations

michel montmorency

représentant autorisé de

500-11-052150-170

monsieur Nicholas Sigounis⁵¹

PAGE: 26

[Emphasis added]

[170] At the time, Jimmy was unaware that the new loan sought by Nicolas was going

to be secured with the Country House and the Marlatt Property.

[171] At trial, Montmorency candidly confirmed that he was involved in the NKDS/Marlatt

refinancing which was essentially prompted by the fiscal debts plaguing the companies

and Nicolas. The goal was to “wipe out” the equity in order to “secure the assets against

an attack” (pour sécuriser les actifs contre une attaque).

[172] Montmorency added that since the Chenoy companies experienced cashflow

issues, this proposed refinancing became a golden opportunity to solve two problems at

once, cover various outstanding debts mostly unrelated to NKDS and shield NKDS’ main

asset from creditors such as the ARQ.

[173] Be that as it may, on the same day, June 29, 2016, Jimmy’s lawyer sent the

following message to his colleague Kounadis and to Montmorency:

Dear Dennis,

Obviously, I am somewhat disappointed by the additional delay but have no

problem in postponing our meeting to next Tuesday, July 5^th, at 11:00, provided

that Michel [Montmorency] confirms to us that, in the meantime, nothing will be

done with respect to the hypothecation of the NKDS property located in Bromont,

and of which Jimmy is a substantial shareholder. I notice that amongst the

documents forwarded by Michel to Jimmy, there appears to be instructions given

to Notary Francis Pierre Rémillard. Obviously, this property cannot be

hypothecated without a proper resolution of the directors and shareholders

of NKDS and, as far as I know, no such meeting had yet been called nor convened.

Provided that we are given the aforementioned assurance and that nothing will

happen with respect to that property without the calling of a proper meeting, we

agree to the postponement of today’s scheduled meeting.⁵²

[Emphasis added]

[174] Following the meeting that was held on July 5, 2016, Jimmy’s lawyer confirmed

the following to Kounadis and Montmorency:

Further to our meeting and discussions of this day, these presents shall serve to

confirm that the hypothecary loan in the amount $400,000.00 will not be proceeded

with and that, in accordance with the instructions conveyed by Michel to Mtre

⁵¹P-8.

⁵²Ibid.

500-11-052150-170

PAGE: 27

Rémillard’s assistant, the file will be put on hold until our client and the rest of his

family decide otherwise.⁵³

[Emphasis added]

[175] A few minutes later, Montmorency reassured Jimmy’s lawyer as follows:

Thank you for your email, although I believe this email was not really necessary,

since you witnessed my call during which I gave instructions, but I just want to

remind you that the file will move on and will be ready to be in place at the right

moment, once all necessary approvals will be obtained.⁵⁴

[Emphasis added]

[176] Contrary to Montmorency’s assurances given on behalf of Nicolas, on July 14,

2016, Nicolas claiming to act as a “duly authorized” representative of NKDS, executed a

deed of hypothecary loan in the amount of $600,000⁵⁵that was not only registered against

the Country House but also against the Marlatt Property belonging to his wife Eleni (the

“NKDS/Marlatt Hypothec”).

[177] The loan proceeds were used to cover various debts, liabilities and bills due by

NKDS or by Eleni and Nicolas in connection with the Marlatt Property. Nicolas also

caused the loan proceeds to cover debts of Chenoy Restaurant due to Mello Foods⁵⁶

without Jimmy’s knowledge and involvement.

[178] The NKDS/Marlatt Hypothec was executed by Nicolas without ever obtaining

Jimmy’s consent as director of NKDS and 33^1/3% shareholder and in direct contravention

to the assurances and representations made by Montmorency on behalf of Nicolas.

[179] On the same day, July 14, 2016, Nicolas also executed an extract of the minutes

of a meeting of the board of directors of NKDS to authorize the $600,000 hypothecary

loan, falsely indicating that all directors had been duly called and were present at NKDS’s

head office (the “NKDS Resolution”).⁵⁷

[180] In fact, at the time, Nicolas was hospitalized, and Argyro confirmed at trial that she

acted as a go-between to get the necessary documents executed by her father. Argyro

was present when her father executed the NKDS Resolution and acknowledged that they

were not at NKDS’s head office, and that Jimmy was not present as director despite the

deceptive wording on the document.

⁵³P-9.

⁵⁴Ibid.

⁵⁵P-10, incidentally, the deed only provided for an initial disbursement of $400,000. It is not certain that the

remaining $200,000 was ever disbursed. Be that as it may, if the intended purpose was to “wipeout”

any equity, a hypothecary charge of $600,000 was satisfying that goal.

⁵⁶P-23.

⁵⁷P-24.

500-11-052150-170

PAGE: 28

[181] In short, Nicolas and Argyro both directors of NKDS with Jimmy could not ignore

at the time that the latter was against such a loan to charge the Country House and yet,

they nevertheless proceeded without any appropriate and valid resolutions and without

the knowledge and consent of Jimmy.

[182] The acts and omissions of Nicolas and Argyro towards Jimmy surrounding the

NKDS/Marlatt Hypothec clearly constitute acts of oppression despite the fact that Nicolas

caused a portion of the loan proceeds to cover outstanding debts to Mello Foods for

supplies sold to the remaining restaurants.

The attempted transfer of shares from NKDS—August 2016

[183] The operation to shield Nicolas’s corporate assets from an “attack” of the tax

authorities did not end with the NKDS/Marlatt Hypothec.

[184] At trial, Argyro acknowledged that her father had told her that they had to protect

the corporate assets since the “government was after him” following the sale of the Laval

Property and of the bankruptcy of the Brossard Restaurant. At the time, we were served

with papers at Kounadis’ office.

[185] On August 22, 2016, Nicolas claiming to be “the major shareholder of NKDS”,

instructed his corporate attorney Kounadis to proceed with the transfer to his unidentified

wife’s company for $1,000 of all trademarks, logos, designs and name related to Chenoy

belonging to NKDS:

As the major shareholder of the above-mentionned (sic) company, I duly

authorize you to prepare all necessary resolutions and transfer documents to

transfer all trademarks, logos, designs and name related to “Chenoy” that belong

to N.K.D.S. Inc., to my wife’s company.

Considering the current value in the books of the company and also since the fair

market of value of the name being is currently very minimal, I want the transfer to

be done for 1 000$.

Please execute this at your earliest and I hereby confirm that I assume all

responsability (sic) toward this transaction.⁵⁸

[Emphasis added]

[186] On the same day, also claiming to be “the major shareholder of Chenoy Food

Network, DDO Restaurant and 114754”, Nicolas instructed Kounadis to sell the shares of

Chenoy Food Network to his unidentified wife’s company for $1,000:

Chenoy’s Network shares are held 50% by Chenoy Delicatessen and Steak House

Inc. and by 114754 Canada Inc., kindly take note that as the major shareholder

⁵⁸P-11.

500-11-052150-170

PAGE: 29

of those 3 companies, I duly authorize you to prepare all necessary resolutions

and deed of sales of 100% shares or transfer of shares of “réseau d’Aliments

Chenoy Inc.” to my wife’s company.

Considering the current value in the books of the companies and also since the

fair market of value is negative, I want the transfers to be done from each company

for a total of 1 000$.

Please execute this at your earliest and I hereby confirm that I assume all

responsability (sic) toward this transaction.⁵⁹

[Emphasis added]

[187] Jimmy who was a director of NKDS, Chenoy Food Network and 114754 was never

consulted by his father nor did he ever consent to those transactions that he was unaware

of.

[188] Despite her fiduciary duty as director of NKDS, Chenoy Restaurant and Chenoy

Food Network, Argyro assisted her father in connection with the above-mentioned

instructions by writing to Kounadis on September 26, 2016, raising her father’s impatience

and insisting that the transfer of the shares and trademarks be completed immediately.

[189] Argyro concluded her message with a veil threat:

As a courtesy to your law firm this will be the last request to the abovementioned

documents.⁶⁰

[190] Kounadis responded quite appropriately to Argyro as follows:

I have repeatedly explained all this to you, your father and Michel [Montmorency].

Michel has understood the predicament and I’m sure has explained all this to you

and your father. We have objections from a minority shareholder [Jimmy] which

will make the situation much more volatile and may be place the majority

shareholder in a predicament.⁶¹

[Emphasis added]

[191] On September 27, 2016, Argyro indicated that she and her father did not accept

no as an answer:

Thank you for your reply, I know you have explained all this to Nick and he told

you to do what needs to be done. To my understanding in your last email the

resolutions are ready for signing, Nick wants you to give them to Michel and Nick

will worry about the circumstances. […]

⁵⁹Ibid.

⁶⁰P-12.

⁶¹Ibid.

500-11-052150-170

PAGE: 30

If you find that you are in a conflict of interest please let me know because Nick

will do what needs to be done to get the shares and trademarks transferred to his

wife’s company.

Like previously stated Nick will like to have the resolutions which you said are

ready, to be given to Michel by the end of this week.⁶²

[Emphasis added]

[192] Subsequently alerted of the situation by Kounadis, Jimmy wrote him back at the

end of the day on September 27, 2016:

Dennis I would also remind both Argy and Michel [Montmorency] that my Dad has

made commitments and promises TO YOU as corporate counsel that by

persuading me signing the costa buyout he agreed and confirmed to you that

he would pay off his Nesbit burns account 170k and forward to me an additional

150k to cover some outstanding loans which needed to be repaid.

Instead they go ahead without my knowledge or any discussion and pledged

the debt free property to pay out bills that have nothing to do with that

company’s debts or obligations and reduce the debts and mortgages of DDO

property and business.⁶³

[Emphasis added]

[193] On the following day September 28, 2016, a colleague at Kounadis’ office tried

once again to set the record straight with Argyro in no uncertain terms about her fiduciary

duty:

As corporate counsel, it is our responsibility to execute the wishes of the directors

and shareholders and to do so, we must firstly assure that the instructions given

are in the best interest of the Corporations and that said Corporations act according

to the rules set out in the laws that govern them. Those instructions require

director approval and, in certain cases, shareholder approval. The wish of a

majority shareholder is not legally sufficient.

That being said, we have received your instructions regarding the transfer of

trademarks by N.K.D.S. and the transfer of shares by Chenoy Network to Helen

Sigounis’ company.

However, we have also been advised by Mr. Jim Sigounis, director and

shareholder of N.K.D.S. and Chenoy Network, directly or indirectly thru subsidiary

companies, that he is not prepared to consent to the transfer of trademarks nor the

transfer of shares to Helen’s company⁶⁴.

⁶²Ibid.

⁶³Ibid.

⁶⁴2638-7639 Québec Inc.

500-11-052150-170

PAGE: 31

Given the fact that the decision to transfer assets to your mother’s corporation

(whichever it may be) is not unanimously approved, the corporations are required

under corporate law to call the appropriate meetings of shareholders and directors

in order to approve the desired transfers. ln addition, since certain shareholders

are corporations, corporate resolutions/approvals must also be obtained in those

corporations before the corporations holding the trademarks and shares are able

to consider the transfers.

This situation was explained to Mr. Montmorency, both verbally and in writing,

which is the reason behind which we received instructions to call the necessary

meetings of the directors and shareholders of the various corporations that are

involved or touched by Mr. Sigounis’ decision to require the transfer of the

trademarks and shares. The retainer was required for this purpose.

The law requires that these procedures be taken in order to protect the creditors

and shareholders of a corporation, and decisions taken by any directors in

defiance of the rights of the creditors and shareholders expose the directors

ta legal responsibility. The directors are imposed by the Civil Code of Québec

and their respective corporate law (the Québec Business Corporation Act or the

Canada Business Corporations Act) to be bound towards the Corporations to act

with prudence and diligence, honesty and loyalty and in the best interest of the

Corporations. Please see the attached annexe.

Furthermore, even if the directors and/or shareholders approve any transfers, the

approval does not protect the transfers (or directors) against ether laws and

obligations that affect all debtors, including tax laws and bankruptcy and insolvency

legislation.

Finally, since the tax department is already making inquiries regarding certain

Chenoys entities, it is our opinion that it is perilous for N.K.D.S. to start

distributing its assets at this time for nominal sums to a corporation

benefitting the wife of the majority shareholder.⁶⁵

[Emphasis added]

[194] As director of the corporations involved in the transfers demanded by her father,

Argyro could not simply obey and execute blindly the instructions of her father to the

detriment of the corporations and of the minority shareholders in blatant violation of her

own fiduciary duty.

[195] On November 24, 2016, in an attempt to resolve the impasse, Kounadis’ office

issued notices calling for meetings of the board of directors for the Chenoy Corporations

involved in the proposed transactions envisaged by Nicolas. Those meetings were to be

held on December 19, 2016.⁶⁶

⁶⁵P-13.

⁶⁶P-14.

500-11-052150-170

PAGE: 32

[196] The Court understands that those board meetings never took place most likely as

a result of the blistering and scathing, yet most revealing, letter dated November 30, 2016,

sent by Jimmy’s counsel to Kounadis, the corporate counsel for the Chenoy

Corporations⁶⁷.

[197] In this long letter, Jimmy’s counsel reminded Kounadis that Jimmy still expected

all parties to abide by the terms of the Costas Agreement reached in December 2013 to

settle Costas Oppression Lawsuit which involved, inter alia, the liquidation and dissolution

of all Chenoy Corporations and the realization of their assets.

[198] Jimmy’s counsel also reminded Kounadis that:

- his client was against the Costas Buy-out using the sale proceeds of the Laval

Property before having completed the liquidation and dissolution of the other

assets of the Chenoy Corporations and ensuring these sale proceeds would serve

to satisfy first and foremost all outstanding liabilities of 114753 and 114754

including tax liabilities;

- Jimmy nevertheless agreed to the Costas Buy-out following Nicolas’ agreement

to:

o have the family members sit down, discuss and agree on the disposal of

the remaining assets of the Chenoy Corporations immediately after the

Costa’s Buy-out;

o repay to Jimmy $150,000 on account of the monies advanced by the latter

to the benefit and account of some of the Chenoy Corporations;

o arrange to pay the indebtedness due by him to Nesbitt Burns in order to

secure Jimmy’s release from the guarantee he had given to Nesbitt Burns

for Nicholas’s investment account; and

o cede and transfer to Jimmy, 1/3 of all shares and loans acquired by him

from Costas after having purchased Costas’ shareholding in the Chenoy

Corporations in compliance with the Nicolas Acknowledgment.

- Following the Costas Buy-out, Nicholas refused to hold the agreed upon family

meeting;

- It was obvious to Jimmy that once he had secured Jimmy’s consent to the Costas

Buy-out, Nicolas set about to renege on his commitments and undertakings, and

act as if he alone were entitled to direct all of the affairs of the Chenoy Corporations

without taking into account Jimmy’s rights as a minority shareholder and director.

[199] Jimmy’s counsel went on to highlight Nicolas’s defaults:

⁶⁷P-15.

500-11-052150-170

PAGE: 33

It is obvious that once he had secured our client’s consent to the Costa buyout,

Mr. Nicholas Sigounis set about to renege on his commitments and undertakings

and act as if he alone were entitled to direct all of the affairs of the Chenoy

Companies without taking into account our client’s rights.

To this day, Mr. Nicholas Sigounis has failed, refused and/or neglected:

A) to cause 8.33 Class A common shares of N.K.D.S., 100 Class A shares

of 136585 and 6.66 common shares of Mona Lisa Advertising Ltd. to be

registered in the corporate records of these corporations in the name of our

client or that of 9616870 Canada Inc.;

B) to cause an amount of $54,661.66 to be recorded in the financial books

and records of N.K.D.S. as being due and owing to our client or to 9616870

Canada Inc.;

C) to pay to our client an amount of $150,000.00 in payment and settlement

of all of the funds loaned and advanced by our client to the benefit of

several members of the Chenoy’s Group of Companies: and

D) to repay to the brokerage firm of Nesbitt Burns the amounts due and

owing by himself in order to secure the release of our client from the

guaranty which he has given Nesbitt Burns for the account of Mr. Nicholas

Sigounis.

Furthermore, Nicholas Sigounis has let it be known that he does not intend to sell

the DDO Property and intends to allow his daughter, Argyro Sigounis, to continue

operating Chenoy Deli in the DDO Property, despite the dire financial situation of

Chenoy Deli and, in turn, Chenoy 1976, as if she alone were the sole

shareholder thereof, without rendering account to any ether of the direct or

indirect shareholders of Chenoy Deli and Chenoy 1976.

As if reneging on his commitments and undertakings did not suffice, Mr. Nicholas

Sigounis has now embarked on a campaign, the sole objective of which is to

strip certain of the companies of the Chenoy’s Group of Companies, in which

our client has a direct or indirect interest, of their assets in order to transfer same

to 2638-7369 Québec Inc., a company whose sole shareholder is his wife, Helen

Sigounis, and to which our client, as you are aware, strenuously objects.⁶⁸

[Emphasis added]

[200] Jimmy’s counsel then went on to discuss his client’s discovery that Nicolas had

signed the NKDS/Marlatt Hypothec in July 2016 on behalf of NKDS of which Jimmy is a

director, by using a false and fictitious resolution of the board of directors of NKDS⁶⁹. Not

only was the hypothecary loan obtained without Jimmy’s consent and knowledge as a

⁶⁸P-15.

⁶⁹P-24.

500-11-052150-170

PAGE: 34

director, but the lawyer made the following comments with respect to the use of the

borrowed funds:

Furthermore, it would appear that the proceeds of these unauthorized loans were

used to pay and satisfy debts owing by Chenoy Taschereau [Brossard], an entity

in which our client has no interest whatsoever and to pay and discharge a

hypothecary loan due and owing to lndividual lnvestment Corporation [I.I.C.] which

had been contracted for the use and benefit of Chenoy Taschereau but which was

secured by a hypothec charging the DDO Property which, as above stated, is being

operated by Argyro Sigounis as if it was her own.⁷⁰

[201] Finally, Jimmy’s counsel reacted to the recent notices of convocation of board

meetings⁷¹as follows:

Determined to continue to act as if he alone could decide upon everything and

anything and although he was fully aware of our client’s refusal to agree, consent

or partake in an operation to strip certain of the Chenoy’s Group of Companies of

their assets, on August 22nd, 2016, Nicholas Sigounis, acting as a major

shareholder, purported to instruct your firm to:

A) transfer 100% of the shares held by 114754 and Chenoy Deli in Network

to his wife’s company for a nominal amount and without regard to law;

B) transfer all trademarks, logos, designs, and intellectual property related

to Chenoy and belonging to N.K.D.S. to his wife’s company for a nominal

amount and without regard to law;

On September 27^th, 2016, our client reminded you that his father, Nicholas, had

made commitments and promises to you as corporate counsel that if our client

agreed to participate in the Costa buyout, he would pay off his Nesbitt Burns

account and forward to our client an additional $150,000.00 to cover some of the

outstanding loans which needed to be repaid.

On the following day, September 28, your firm advised Argyro Sigounis and Michel

Montmorency that you could not act upon the unilateral instructions received from

Mr. Nicholas Sigounis and that if the decision to transfer assets was not

unanimously approved, then the corporations were required under Corporate Law

to call the appropriate meetings of shareholders and directors.

Furthermore, your firm advised that since the authorities were already making

enquiries regarding certain Chenoy entities, it was your opinion that it was perilous

for N.K.D.S. to start distributing its assets at this time for nominal sums to a

corporation benefiting the wife of the majority shareholder.

Yet and notwithstanding our client’s continued refusal to participate in the

aforementioned asset striping (sic) operations, and in spite of being advised by

⁷⁰P-15.

⁷¹P-14.

500-11-052150-170

PAGE: 35

your firm that such an operation was perilous, our client was just served with

notices of meetings scheduled for December 19^thnext and the purpose of which is

to consider and vote upon the resolutions required in order to carry out and

implement the aforementioned asset striping (sic) operations.

ln so doing, Mr. Nicholas Sigounis continues to act as if he were the sole

shareholder and director of the Chenoy’s Group of Companies in a manner

which is oppressive and unfairly prejudicial to our client’s interest and

legitimate expectation as a shareholder and director of the aforementioned

companies and with an utter disregard to the obligations of such Companies

to their respective creditors (including the federal and provincial tax

authorities).⁷²

[Emphasis added]

[202] Jimmy’s counsel concluded his letter by demanding that the notices convening

board meetings be rescinded failing which oppression remedy proceedings would be

initiated seeking, inter alia, the liquidation and dissolution of the Chenoy Corporations.

[203] By email dated December 9, 2016, Kounadis’ office advised that the meetings of

December 19^thnext were postponed until further notice.⁷³

The Lease between Chenoy DDO and DDO Restaurant—June 1, 2016

[204] Despite the fact that they had an agreement since 2013 that the DDO Property

and the DDO Restaurant would be sold, unbeknownst to Jimmy a director of Chenoy

DDO, Nicolas acting for the landlord (Chenoy DDO) allegedly executed on June 1, 2016,

a “triple net” commercial lease with DDO Restaurant represented by Argyro⁷⁴(the

“Lease”). It was the first time that such a lease was executed between Chenoy DDO

and DDO Restaurant.

[205] On October 25, 2016, Argyro caused the registration of a first notice of publication

of the Lease.⁷⁵

[206] Due to an error in the description of the parties to the June 1, 2016, Lease, another

notice was registered against the DDO Property on August 25, 2017,⁷⁶after the institution

of the present proceedings.

[207] At all relevant times, as director of the landlord, Jimmy never agreed to nor was

he ever consulted about entering into such a Lease and subsequently proceeding to its

⁷²P-15.

⁷³P-16.

⁷⁴P-29.

⁷⁵P-20 and P-29A.

⁷⁶P-29B.

500-11-052150-170

PAGE: 36

registration against the DDO Property, especially in the context where he had initiated

oppression remedy proceedings that involved the sale of the DDO Property.

[208] In any event, Jimmy testified that his sister did not pay the rent to Chenoy DDO

pursuant to the terms and conditions of the Lease. The preponderant evidence proved

that he was right in that regard with, inter alia, funds flowing back and forth between the

bank accounts of Chenoy DDO and DDO Restaurant after the payment of portions of the

rent from time to time in a seemingly haphazard manner.

[209] At trial, Argyro attempted unconvincingly to persuade the Court that the Lease was

entered into at the request of the Scotia Bank, without providing any evidence whatsoever

to that effect.

[210] The evidence rather suggests that this Lease was meant as a pre-emptive strike

since efforts to sell the DDO Property were resuming.

The “new” failed attempts to sell the DDO Property in 2016

[211] On December 22, 2016, Groupe Park Avenue Inc. made an offer of $3.45M for the

DDO Property net of commissions (the “Groupe Park Avenue Offer”).⁷⁷

[212] Nicolas refused to even respond to the Groupe Park Avenue Offer on the basis

that he had previously accepted an offer from Argyro that was still open.

[213] Jimmy was totally unaware of it and discovered it through the consultant

Montmorency long after the fact.

[214] The evidence revealed that Nicolas used his daughter’s offer as a false pretext to

avoid responding to the Groupe Park Avenue Offer.

[215] At the time, Jimmy had never seen or heard of another offer made by Argyro,

bearing in mind that she had previously secretly submitted two offers to her father in 2014.

[216] During her cross-examination, Argyro mentioned that she also made a $2.9M offer

in March 2016 but could not produce the document as an exhibit.

[217] According to Argyro, her father Nicolas did not want to sell the DDO Property but

did not tell her why…

[218] Apparently, her $2.9M offer of March 2016 was not accepted by her father who

told her to stop making efforts to find money to buy the DDO Property that was supposed

to be hers anyway.

[219] Then, why did Argyro submit another offer in June 2016?

⁷⁷P-17.

500-11-052150-170

PAGE: 37

[220] Argyro testified that when there was a possibility of a lawsuit by Jimmy after the

sale of the Laval Property and the Costas Buy-out, Nicolas told her to stop searching for

financing. We’ll find another way.

[221] They did!

[222] In an email sent on December 27, 2016, by the consultant Montmorency who had

been hired to assist in the restructuring which turned into somewhat of a liquidation

process, Montmorency wrote to Jimmy:

I was told that an offer [the Groupe Park Avenue Offer] would have come to your

father; withouth (sic) having all the details, allow me to present you a 1st picture

with the amount that I was told.

Also, for your information, Nick has already accepted an offer from your sister that

is subject to financing that she did not get as at yet and it expires end of January

2017. So Nick has to take some precaution before to put his signature on another

offer, because he can not accept 2 offers, unless to get the 1st one cancelled and

thjen (sic) compensate the broker which should be minimum any how!. (sic)⁷⁸

[Emphasis added]

[223] Based on the foregoing, the evidence shows that Nicolas was not truthful with

Montmorency.

[224] Be that as it may, Jimmy replied immediately to Montmorency:

Yes we have an official offer for $3,450,000 Net of commissions with a deposit

this was officially submitted to my father and sent to corporate council as this would

require shareholders meeting and approval. As far as any other offers I’m not

aware … they should have been submitted to corporate council and all

shareholders.⁷⁹

[Emphasis added]

[225] At that time in December 2016, Jimmy did not know that on June 23, 2016, Argyro

had signed and submitted an offer to her father to once again try to acquire the DDO

Property for an amount of $2.1M conditionally upon obtaining a $1.7M hypothecary

financing (the “Argyro June 2016 Offer”).⁸⁰

[226] Jimmy discovered that his father Nicolas, a director of Chenoy DDO and 136585,

had secretly accepted her offer on June 28, 2016, on behalf of 136585 and Chenoy DDO.

⁷⁸P-18.

⁷⁹Ibid.

⁸⁰P-31.

500-11-052150-170

PAGE: 38

[227] In short, Nicolas had accepted the Argyro June 2016 Offer in secret without ever

showing the same to Jimmy nor obtaining his consent as director of 136585 and of

Chenoy DDO.

[228] The existence of the Argyro June 2016 Offer for $2.1M was only revealed by

necessity in late December 2016 to seemingly block the Groupe Park Avenue Offer of

$3.45M.

[229] However, a perusal of the Argyro June 2016 Offer revealed that Montmorency

was, in all likelihood, misled by Nicolas if the latter really told him that Argyro had until the

end of January 2017 to complete her financing.

[230] There were no such conditions in the Argyro June 2016 Offer that provided instead

30 days from the acceptance of her offer to present proof of a $1,177,763 financing. In

reality, such a financing was not really needed given the other “special” provisions of the

Argyro June 2016 Offer.

[231] The closing was to take place on or before August 15, 2016, not after the end of

January 2017.

[232] Be that as it may, given the subsequent turn of events, and the relief sought by

Jimmy and DICS Eleni, it is relevant to note that with this document, Argyro and Nicolas

were concocting a scheme to sell or transfer more than the DDO Property to Argyro.

[233] To all intents and purposes, the scheme, if realized, would have caused the

transfer to new corporations set up for the occasion by Nicolas and Argyro, of all of the

shares and assets of Chenoy Food Network, Chenoy DDO and DDO Restaurant.

[234] Section 12 of the Argyro June 2016 Offer read as follows:

12 OTHER DECLARATIONS AND CONDITIONS:

1. Is also a SELLER: Nicholas Sigounis (personally)

Adress (sic): 1041 Marlatt Street, Montréal (Québec) H4R 1T1

The seller must ensure that the name and trademark are available for use.

The total price of $2,100.000 includes the property located at 3616 blvd St-John in

DDO, the facilities of the restaurant, goodwill, phone numbers, fax number, access

to the website, signs, all the known rights and known and unknown easements,

100% of the share capital of company.

4.2: Exemption to be asked by the buyer⁸¹.

⁸¹The “Exemption” related to the payment of the GST/QST on the sale price.

500-11-052150-170

PAGE: 39

5.2: ADDITIONAL SUM [$912,237]: Represents the assumption of the

companies debts by the BUYER⁸². The Purchaser having had a preliminary

opportunity to perform the searches and other due diligence reasonable or

customary in a transaction of a similar nature to that contemplated herein;

All representations and warranties of the Target⁸³(sic) and the Vendors being true

and all convenants (sic) of the Target and the Vendors having been performed in

all material respect as of the Closing;

That the formal offer shall contain the usual terms and conditions acceptable to

Purchaser;

The assumption of debt, the repayment of advances to shareholders and

repayment of existing mortgages will be entirely at the buyer’s expense.⁸⁴

[Emphasis added]

[235] Of greater interest, the Argyro June 2016 Offer also contained an Addendum on

its Annex G⁸⁵providing a complete accounting of the proposed transaction involving a

global amount of $2,100,000 and which contemplated:

- a vertical merger of Chenoy DDO and DDO Restaurant to be performed prior to

the transactions;

- the purchase by “Nicolas’ nominee” for $1,000 of the shares of Chenoy Food

Network held by DDO Restaurant and the shares of 114754 to be performed prior

to the transactions;

- the purchase by a “first Newco⁸⁶” (“Newco1”) of the DDO Property for

$1,700,447⁸⁷; according to the offer, Newco1 was to acquire from the vertically

merged Chenoy DDO/DDO Restaurant, the DDO Property, the entire restaurant

facility, the goodwill with the right to use the Chenoy’s name and trademarks; in

other words, all the assets of Chenoy DDO and of DDO Restaurant and more;

- the purchase by a “2^ndNewco⁸⁸” (“Newco2”) of Nicolas’ 60% shares in Chenoy

DDO⁸⁹for $9,353;

⁸²The Additional Sum stated therein was $912,237 without providing any other details. The Additional Sum

was in addition to the $10,000 deposit and was the only amount payable to the notary in time for the

closing but in reality, no such amount was payable at closing.

⁸³The expression “Target” is not defined anywhere.

⁸⁴P-31, page 8/12.

85

Ibid., pages 10-11. The Addendum is reproduced as an Annex to the present judgment for ease of

reference.

⁸⁶The future shareholder(s) of Newco1 was (ere) not identified.

⁸⁷($2.1M—$9,353—$390,200= $1,700,447).

⁸⁸Idem.

⁸⁹By then, Chenoy DDO would have been vertically merged with DDO Restaurant.

500-11-052150-170

PAGE: 40

- the purchase by Newco2 of the 40% shares held by 136585 in Chenoy DDO⁹⁰for

$390,200;

[236] In other words, the transaction contemplated in the Argyro June 2016 Offer went

beyond a simple land sale transaction involving the DDO Property for $2.1M.

[237] In reality, the global price of $2,100,000 was composed of:

- $1,700,447 for the acquisition by Newco1 of the DDO Property from Chenoy DDO

after the vertical merger;

- $9,353 for the acquisition by Newco2 of Nicolas’ 60% direct shares in Chenoy DDO

and $390,200 for the acquisition of 136585’s 40% shares in Chenoy DDO.

[238] Indicating holding a 20%⁹¹shareholding in 136585, Nicolas stood to receive an

additional $78,040 from the $390,200 payment to be made by Newco2.

[239] In short, Argyro (and Nicolas) was(were) planning to acquire via Newco2 all of the

shares of Chenoy DDO—after its vertical merger with DDO Restaurant—for $399,553

being her father’s 60% shares in Chenoy DDO for $9,353 and the 40% shares of 136585

for $390,200.

[240] This begs the following question.

[241] Since those transactions were to take place after the vertical merger of DDO

Chenoy and DDO Restaurant, who was actually going to receive the sale proceeds of

$1,700,447 for the DDO Property?

[242] It had to be the vertically integrated Chenoy DDO after its original

shareholders 136585 and Nicolas would have sold their shares for $390,200 and $9,353

respectively bearing in mind that Nicolas was expecting to sell his 60% interest for only

$9,353…

[243] In any event, the Addendum to the Argyro June 2016 Offer provides the answer:

- $9,353 payable to Nicolas and $390,200 payable to 136585 with $78,040 reverting

back to Nicolas for his 20% share.

[244] With respect to the actual sale price of $1,700,447, the buyer Newco1 was

expected to pay $922,237 at an undetermined later date by way of an assumption of

[unidentified] debts by the buyer. There were no indications of the identity(ies) of the

beneficiary(ies) of those assumed debts.

⁹⁰Idem.

⁹¹As opposed to the 30% shareholding claimed by Argyro.

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[245] As for the remainder of $778,210, Newco1 was to:

- assume an existing mortgage loan estimated at the time at $558,000;

- brokerage fees of $21,000;

- other fees of $5,000;

- debts to trade and government of $58,162; and

- two loans of $104,948 and $31,100 due to a director, namely Nicolas.

[246] Clearly, without knowing the actual beneficiary(ies) of the balance-of-sale price of

$922,237, the sale price of the DDO Property of $1,700,447 was not destined to the

existing shareholders of Chenoy DDO other than Nicolas indirectly.

[247] Finally, the Addendum revealed that Nicolas expected to receive a global amount

of $223,440 to effectively sell to his daughter, via Newco1 and Newco2, all of his interests

as a shareholder of Chenoy DDO, DDO Restaurant and of 136585:

Nick Sigounis will be getting:

From the shares: 9 352$

From advances: 104 948$

From other advances: 31 000$

From 136585 Canada Inc.: 20% of 390 200$ = 78 040$.

Total from transaction: 223 440$⁹²

[248] Again, these figures do not account for the $922,237 of debts to be assumed by

the buyer payable at an undetermined later date to unidentified creditor(s).

[249] With such information on hand, the Court can understand why Nicolas and Argyro

were preoccupied to keep the Argyro June 2016 Offer secret, especially to their co-

director Jimmy. Even the consultant Montmorency was kept in the dark by Nicolas and

Argyro.

[250] The foregoing may also explain why Nicolas—with the assistance and complicity

of Argyro—was so adamant to proceed quickly with the sale to “my wife’s company” of

the Chenoy Food Network’s shares for $1,000 and the transfer of all trademarks, logos,

designs and names related to “Chenoy” that belonged to NKDS with their instructions of

August 22, 2016,⁹³to their corporate attorney Kounadis, as it was more fully discussed

above.

[251] Obviously, acting in secret without the knowledge and consent of Jimmy as a

minority shareholder and as co-director of the various corporations involved in the

⁹²P-31, page 11.

93

P-11. Kindly refer to Chapter 3.11—The attempted transfer of shares from NKDS—August 2016,

paragraphs 183 to 203 above.

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contemplated transactions and merger, the Court can only see two directors, Nicolas and

Argyro, who were concocting a scheme, being in flagrant conflict of interest and acting in

clear breach of their fiduciary duty with a blatant unfair disregard of the interest of the

Chenoy Corporations involved and their other shareholders.

[252] Be that as it may, once the end of January 2017 fictitious deadline expired with

respect to the Argyro June 2016 Offer, Groupe Park Avenue renewed, on February 9,

2017, its offer to purchase the DDO Property in the same amount of $3.45M net of

commissions and without any financing clause.

[253] How could Nicolas and Argyro as co-directors of Chenoy DDO be acting in the

best interest of that corporation and its shareholders and justify refusing such an offer

involving a “real payment” of $3,450,000 for the DDO Property, which was significantly

more than Argyro’s latest secret offer?

[254] In reaction to the second Groupe Park Avenue Offer, Jimmy quite appropriately

requested to schedule a meeting with the family to review and consider this offer to

purchase.⁹⁴But his father refused to hold such a meeting to consider the latest offer or to

make any counteroffer.

[255] All in all, despite his contractual undertakings stemming from the Costas

Agreement, on the one hand, since 2014, Nicolas secretly received and/or accepted up

to three offers from his daughter that never led to any conclusion due to lack of financing

and the terms and conditions of which were nowhere near as favourable as offers

received from serious third parties.

[256] On the other hand, Nicolas steadfastly refused all offers made by those third

parties without even responding to them, let alone by making any reasonable counteroffer

if he was not satisfied therewith.

[257] In Jimmy’s view, Nicolas was reneging the Costas Agreement and was

perpetuating the unacceptable status quo maintaining an unprofitable restaurant

business on a land worth millions of dollars.

[258] Confronted to such oppressive actions and obstruction from Nicolas and Argyro,

Jimmy had no other alternative but to file his Oppression Remedy Application in February

2017.

[259] However, Nicolas’s and Argyro’s oppression continued afterwards.

The oppression post filing of the Oppression Remedy Application

[260] The Court has already mentioned the transfer/sale of December 8, 2019, of all

Nicolas’s Shares to his daughter Argyro who was adamant to keep it secret from her

⁹⁴P-19.

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mother, her brother and even from the Court insofar as the details of the transaction were

concerned.

[261] Once Argyro finally complied with the Order of this Court and as those details

became known, they prompted the Cross-Application and the Intervention filed by DICS

Eleni and Jimmy’s Paulian Action.

[262] Save for two exceptions, it was decided that the issues raised by Jimmy in his

Paulian Action and by DICS Eleni in her Cross-Application/Intervention that did not relate

directly to the present oppression remedy proceedings, would be dealt with at a later date.

[263] Therefore, the Court shall refrain from discussing and dealing with those issues

more fully, bearing in mind that it was ordered that the evidence and testimonies adduced

during the present trial shall form an integral part of the evidence to be adduced when the

outstanding issues and demands are heard on their merits.

[264] Of particular interest in the present proceedings, Nicolas tried to transfer to Argyro

shares that he had specifically committed to transfer to Jimmy pursuant to the

Acknowledgment that he signed on February 8, 2016⁹⁵, as part of his agreement to induce

his son Jimmy to partake in the Costas Buy-out and sign the Costas Release with the rest

of the Sigounis family members.

[265] Argyro refused to recognize the validity and the opposability of the

Acknowledgment insofar as a specific number of shares of 136585 and of NKDS acquired

by her father from Costas via the Costas Buy-out belonged to Jimmy who was their

beneficial owner. Argyro’s position was essentially twofold:

- her unsubstantiated affirmation that her father would have changed his mind and

no longer considered the Acknowledgment binding and enforceable; and

- the absence of proper corporate resolutions and entries in the minute books of

those corporations finalizing the transfer of Jimmy’s shares.

[266] These two arguments were “utilisés à toutes les sauces” by Argyro whenever

convenient.

3.14.1 Nicolas allegedly felt that he was no longer contractually bound

by the Costas Agreement and the Acknowledgment

[267] Argyro testified that once the Costas Buy-out finally took place with Jimmy’s

consent and assistance—based on representations and assurances of Nicolas that

proved false—her father no longer felt bound by the December 2013 Costas Agreement

⁹⁵P-26.

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and by the February 2016 Acknowledgment adding that she personally never agreed with

the terms and conditions of those two agreements executed by her father.

[268] In other words, Argyro suggested to the Court that once the Costas Buy-out was

completed and that Costas’ legal threats were no longer material, her father’s signature

on contractual documents became worthless especially when it involved somehow the

undertakings and commitments taken in favour of her brother Jimmy.

[269] Argyro’s position purported to lead the Court to believe that her father signed, inter

alia, the Costas Agreement and the Acknowledgment because he had no other choice to

do so. On the one hand, he wanted to induce Costas to settle his oppression remedy

proceedings. On the other hand, he wanted to induce Jimmy—personally and as director

of most of the Chenoy Corporations—to give his consent to and partake in the

transactions related to the Costas Buy-out as Jimmy’s involvement and signature were

essential to complete said transactions with Costas.

[270] Once his goals were achieved and his brother Costas was no longer in the picture

thanks to Jimmy’s cooperation, Argyro claimed that her father felt at liberty to decide, to

ignore and to disregard his written contractual obligations and undertakings towards his

son which gave rise, in great part, to the major dissension that led to the present

proceedings.

[271] With all due respect, based on Argyro’s testimony, it would seem that her father’s

written and signed undertakings were not trustworthy as he was able to change his mind

at liberty once the reasons that compelled him to sign such documents disappeared.

3.14.2 The absence of proper corporate resolutions

[272] On a different note, the absence of corporate resolutions being duly adopted has

been invoked by all.

[273] For example, DICS Eleni and Jimmy argued that proper corporate resolutions were

not duly adopted authorizing the transfers of Nicolas Shares to Argyro bearing in mind

that Jimmy as co-director was never even informed of those transfers nor was he ever

asked to approve them as director given the shroud of secrecy set up by Nicolas and

Argyro.

[274] Another example involving Argyro is the absence of proper corporate resolutions

and entries in the minute books of the concerned corporations evidencing the transfer of

Jimmy’s shares covered by the Acknowledgment.

[275] In fact, the minute books of the Chenoy Corporations are in poor state and have

revealed to be quite unreliable as they were not properly maintained, this being said

without imputing any fault on the corporate counsels, but rather on Nicolas’s lack of

concerns for what appeared to be unimportant details in his eyes.

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[276] With all due respect, such an argument (the lack of proper resolutions and entries

in the minute books) cannot only sit well with Argyro when it suits her purposes and be

discarded when it does not.

[277] But with respect to Jimmy’s shares at the core of the Acknowledgment, the

evidence revealed more relevant facts confirming the validity of Nicolas’s undertakings.

3.14.3 The Acknowledgment of February 8, 2016, and the agreement of

Nicolas to transfer certain of Costas’ shares to Jimmy

[278] Pursuant to the Acknowledgment, certain shares acquired by Nicolas from Costas,

thanks in part to Jimmy’s consent to participate to the Costas Buy-out, were acquired by

Nicolas for the benefit of Jimmy.

[279] The Acknowledgment purported to essentially bring Jimmy’s shareholding in

136585 from 30% to 40% and in NKDS from 25% to 33^1/3%, reducing Nicolas’s

proportions by as much from 30% to 20% in 136585 and from 75% to 66^2/3% in NKDS.

[280] As previously mentioned, Argyro is contesting the validity of the percentages

claimed by Jimmy on the basis that the minute books of 136585 and NKDS did not reflect

the same without forgetting that Nicolas allegedly changed his mind subsequently about

it.

[281] But did he really change his mind?

[282] The Court does not believe so.

[283] The Argyro June 2016 Offer⁹⁶provides an indication as to how Nicolas treated his

undertakings made in favour of his son Jimmy in the Acknowledgment.

[284] First of all, there is no doubt in the mind of the Court that Nicolas had a hand in the

preparation of the Argyro June 2016 Offer.

[285] At clause 9 of the Addendum containing a summary of the amounts that would be

paid to Nicolas personally included a mention that he stood to receive $78,040

representing 20% of the $390,200 that would be paid by Newco2 to acquire the shares

of 136585.

[286] In June 2016, Nicolas did not use a share of 30% as subsequently argued by

Argyro. Four months after executing the Acknowledgment, Nicolas was already

recognizing and acting as if his shareholding in 136585 was at the 20% level. Yet, no

corporate resolution had been formally adopted and entered into the minute books of

136585.

⁹⁶P-31.

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[287] Be that as it may, Kounadis, the corporate attorney, confirmed during his testimony

that he was aware of the Acknowledgment, which was specifically mentioned, inter alia,

in the corporate summaries prepared by his office that contained the following mentions:

- In the corporate summary of 136585⁹⁷:

Nick holds one third (1/3) of the 300 shares for Jimmy Sigounis, in accordance with

the Acknowledgment Agreement dated Feb. 8, 2016.

- In the corporate summary of NKDS⁹⁸:

Nick holds one third (1/3) of the 25 shares purchased from Costa Sigounis for

Jimmy Sigounis, in accordance with the Acknowledgment Agreement dated Feb.

8, 2016.

[288] Given the broad powers conferred upon the Court pursuant to Section 241 (3) of

the Canada Business Corporations Act⁹⁹, in the presence of oppressive conduct, the

Court finds, for the purposes hereof, that Jimmy holds 40% of the shares of 136585 and

33^1/3% of the shares of NKDS, thus leaving Nicolas’s shares at 20% and 66^2/3%

respectively. The Court shall also order 136585 and NKDS to make the necessary

inscriptions and/or corrections, if need be, in their registers and other records to reflect

the Court’s findings.

3.14.4 The urgent repairs to the DDO Restaurant requiring hypothecary

financing in October 2019

[289] With all due respect, certain events occurred after the institution of the Oppression

Remedy Application that left the Court to question Argyro’s understanding of her fiduciary

duty as director of NKDS, Chenoy DDO and DDO Restaurant particularly, and of the

necessity for her to respect, follow and abide by the Orders issued by this Court.

[290] On September 26, 2019, the counsel for Nicolas and Argyro filed a Motion to

partially lift the Safeguard Order of May 18, 2018, that prevented, inter alia, borrowing

against and charging the DDO Property.

[291] Argyro claimed that the roof of the DDO Property, the air conditioning units as well

as the celling, lighting system and the hot water tank must be immediately repaired or

replaced.¹⁰⁰She provided various estimates totalling $223,207.92 to perform the repairs

on an urgent basis.¹⁰¹

⁹⁷P-27B-3.

⁹⁸P-27B-7.

⁹⁹136585 and NKDS were both constituted under the CBCA.

¹⁰⁰Paragraph 2 of the Motion to lift the Safeguard Order in part of September 26, 2019.

¹⁰¹Paragraphs 11-16 of the Motion to lift the Safeguard Order in part of September 26, 2019.

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[292] In order to proceed with those immediate repairs, Defendants were seeking the

authorization of the Court to allow a $530,000 hypothecary financing to charge the DDO

Property although the proposed loan agreement produced as an exhibit provided for a

$600,000 loan not $530,000¹⁰².

[293] The proceeds of the $530,000 loan were destined to reimburse two existing

hypothecary loans totalling $305,577.62 with the balance of some $224,000 being used

for the urgent repairs more fully described in the Motion to lift the Safeguard Order in part

of September 26, 2019.

[294] By judgment rendered on October 28, 2019¹⁰³, based on the evidence adduced

and the representations of Argyro, the Court authorized the partial lift of the Safeguard

Order with strict instructions on how to use the borrowed funds that were increased to

$600,000 at Argyro’s request:

[32] PARTIALLY LIFTS the existing Safeguard Order of May 18, 2018, and

ALLOWS and AUTHORIZES Chenoy Delicatessen & Steak House (1976) Ltd. to

grant an immovable hypothec against the Chenoy Property situated at 3616 St-

Jean Boulevard, in the Municipality of Dollard-des-Ormeaux to secure in favour of

the lender a loan of up to $600,000 in capital with the strict understanding that the

proceeds of the proposed loan shall be used primarily to reimburse the two existing

hypothecary loans affecting the Chenoy Property in favour of the Scotia Bank and

ICC and secondarily, to carry out the repairs to the Chenoy Property situated

at 3616 St-Jean Boulevard, in the Municipality of Dollard-des-Ormeaux that

were more fully described in Defendants’ “Motion to lift the Safeguard Order

in part” of September 26, 2019;

[Emphasis added]

[295] In order to conclude as it did, the Court made the following comments:

[14] The evidence (including photographs) submitted at the hearing satisfy the

Court that the Chenoy Property housing a 24-hour restaurant operation is in dire

need of a new roof that can no longer be reasonably be patched again and

again¹⁰⁴. This replacement must be carried out before winter [2019] to stop the

various roof leaks that have plagued the restaurant operations during the last

winter and spring seasons.

[15] The air conditioning units¹⁰⁵that are located on the roof no longer function

reliably and must also be replaced together with a hot water tank¹⁰⁶. Finally, the

numerous water infiltrations have severely damaged the tiles found in the inside

¹⁰²P-1 of the Motion to lift the Safeguard Order in part of September 26, 2019.

¹⁰³2019 QCCS 4487.

¹⁰⁴Exhibit P-2.

¹⁰⁵Providing heat and cool air (Exhibit P-3).

¹⁰⁶Exhibit P-6.

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suspended ceiling throughout the building. The tiles must be entirely replaced¹⁰⁷

together with the integrated lighting system¹⁰⁸.

[…]

[18] Be that as it may, Argyro testified that she nevertheless obtained from a private

lender a bridge loan offer in the amount of $600,000 at a rate of 10% per annum

payable by way of monthly interest payments of $5,000, the $600,000 capital

becoming due 18 months after the disbursement¹⁰⁹. Argyro added that the bridge

loan will ensure that the urgent repairs to the Chenoy Property will be carried

out in time for the winter season and allow for the completion of the long-awaited

financial statements to be remitted to the chartered banks that will be approached

once again for a more formal hypothecary loan.

[19] In addition to enabling Chenoy and Chenoy 1976 to deal with the urgent

repairs and obtain additional time to seek a conventional hypothecary loan (as

opposed to a bridge loan), the proposed bridge loan will cause to lower the monthly

carrying costs that are presently paid to the Scotia Bank and to ICC.

[Emphasis added]

[296] At the time, Jimmy contested Defendants’ Motion being convinced that Argyro’s

estimates were not realistic and were significantly inflated. The Court addressed Jimmy’s

position as follows in the judgment:

[27] Finally, the Court does not believe that Plaintiff, who is a 12.5% indirect

shareholder, will suffer a prejudice with this refinancing and the proposed

renovations to the Chenoy Property.

[28] The Court understands that Jimmy who still advocates the pure and simple

liquidation of inter alia, Chenoy and of Chenoy 1976, is against such a refinancing

as he is of the view that the land would be worth more than $4M without the current

building erected on it, adding that in his view, the Chenoy’s restaurant operations

managed by his sister Argyro are not profitable and should close permanently, a

fact that seems inaccurate based on the financial information provided to the Court.

[297] With all due respect, in retrospect and based on the evidence adduced at the trial

on the merits, the Court seriously doubts now that the financial projections provided were

reliable and reasonable at the time regardless of the adverse impact of the Covid-19

pandemic.

[298] On December 13, 2019, relying on Argyro’s representations, the Court granted

Argyro’s request to be authorized to sign alone and without Jimmy’s involvement, the

deed of loan and deed of hypothec on behalf of Chenoy DDO with an order that a copy

¹⁰⁷Exhibit P-4.

¹⁰⁸Exhibit P-5.

¹⁰⁹Exhibit P-1.

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of the executed deed of Loan and of the deed of immoveable hypothec be communicated

to Jimmy’s lawyer within a reasonable delay after they became available to her.

[299] The Court also pronounced the following:

PRAISES ACT of the undertaking of Defendant Ms. Argyro Sigounis to provide to

the attorney for Plaintiff Mr. Jimmy Sigounis within a reasonable delay after they

are available to her, a copy of any contract executed, as the case may be, ail the

main invoices issued in connection with the repairs to be carried out on the Chenoy

Property pursuant to the undersigned’s October 28, 2019, Order and the evidence

of payment of said main invoices.

[Emphasis added]

[300] In retrospect, Argyro did not honour her undertakings for the simple reason that

most of the alleged “urgent repairs” were not carried out as previously represented to the

Court. The pandemic cannot explain by itself this surprising turn of events given the

“gravity” of the situation in October 2019 and the fact that borrowed funds earmarked

specifically for those “urgent repairs” would be available several months before the onset

of the pandemic.

[301] On February 1, 2021, Argyro was still in default to honour her undertakings noted

by the Court in its judgment of December 13, 2019. The situation prompted the

presentation by Jimmy of a Demand for case management seeking, inter alia, an order

against Argyro for the disclosure and production of

- the contracts entered into with the contractors with respect to the “urgent repairs”

authorized in October 2019 and the relevant invoices; and

- the documents evidencing the transfer of Nicolas’ Shares to Argyro.

[302] Jimmy also sought an accounting of the $600,000 funds borrowed against the

DDO Property and the production of various financial statements of the Chenoy

Corporations that were still missing.

[303] On March 12, 2021, the Court rendered various Orders in connection with the

foregoing Demand.

[304] Unfortunately, on September 3, 2021, the Court had to reiterate the Order made

on March 12, 2021, which had previously granted to Argyro a delay ending on April 12,

2021, by extending that delay to September 13, 2021:

Le Tribunal RÉITÈRE son ordonnance prononcée le 12 mars 2021 :

«ꢀLe Tribunal ORDONNE que la défenderesse Argyros Sigounis fournisse par

l’entremise de son avocat Me Rosenzveig d’ici au 12 avril 2021, une reddition de

compte détaillée établissant l’usage qui a été fait du produit de deux chèques émis

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par la notaire Me Annie Morrisseau à savoir un chèque au montant de 50ꢀ624,27 $

daté du 24 mars 2020 payable à l’ordre Charcuterie & Grilladerie Chenoy (1976)

Ltée (pièce A-3) et un chèque au montant de 46ꢀ164,72 $ apparemment émis à

l’ordre de Charcuterie & Grilladerie Chenoy (1976) Ltée (Avance aux

administrateurs) (pièce A-1). Quant au deuxième chèque la défenderesse devra

également produire une copie de celui-ci. Dans les deux cas, la reddition de

compte de la défenderesse inclura la production des relevés de comptes bancaires

attestant ou constatant l’usage qui a été fait du produit des deux chèques en

question.

Le Tribunal ORDONNE également que la défenderesse Argyros Sigounis

fournisse d’ici au 12 avril 2021 par l’entremise de son avocat Me Rosenzveig la

preuve documentaire qui devra être satisfaisante aux yeux du Tribunal confirmant

que le solde du prêt hypothécaire de 151ꢀ791,24 $ (pièce A-1) se trouvant toujours

dans le compte en fidéicommis de la notaire Morrisseau est suffisant pour

permettre au printemps 2021 la réfection complète du toit de l’édifice situé au 3616

boul. Saint-Jean à Dollard-des-Ormeaux et d’y installer deux nouvelles unités d’air

climatisé comme il avait été prévu à l’automne 2019. […]ꢀ»

Le Tribunal ACCORDE un nouveau délai jusqu’au 13 septembre 2021 à Me

Di Battista pour se conformer à cet ordre du Tribunal.

[Emphasis added]

[305] On the first day of the trial in October 2021, Jimmy’s lawyer reiterated that Argyro

had still not produced the cheques and invoices ordered on March 12, 2021, evidencing

the use of the funds borrowed with the $600,000 hypothecary loan authorized by the

Court in 2019.

[306] Argyro’s apparent reluctance may have been justified with the proof that was about

to be made in that respect.

[307] An “État des déboursements” as at August 30, 2021,¹¹⁰was produced. It related

to the Chenoy DDO $600,000 loan and was prepared by Notary Annie Morrisseau.

Surprisingly, it revealed an unused loan balance that had shrunk to $75,357.56 from the

amount of $151,791.24 appearing in Exhibit A-1¹¹¹filed in March 2021 in support of

Argyro’s sworn declaration in response to Jimmy’s Demand at the time.

[308] In other words, between the Court Orders rendered from March 12, 2021, onwards

until the trial was held in October 2021, the unused balance of the $600,000 loan went

from $151,791.24 to $75,357.56¹¹²with a differential of $76,433.44.

¹¹⁰CP-25A.

¹¹¹P-21.

¹¹²CP-25A.

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[309] According to the “État des déboursements”¹¹³, bearing in mind that the “urgent

repairs” had to be performed before the winter of 2019 for an estimated global amount of

$223,207.92, by the end of August of 2021, almost two years later, Chenoy DDO had

only spent a total of $109,270.54 on account of those “urgent repairs” with the roof only

being done in July 2021 (two winters later) at the cost of $54,038.25¹¹⁴instead of the

estimate of $90,446,23¹¹⁵provided to the Court in October 2019.

[310] The Court also bears in mind that the estimates produced by Argyro at the time

that were contested by Jimmy as exaggerated, also purported to justify a loan increased

to $600,000.

[311] Be that as it may, although the $600,000 loan proceeds were also used to pay the

previous hypothecary loans as directed by the Court in its judgment of October 28, 2019,

the evidence revealed that contrary to the Court’s Orders that provided strict instructions

on the use of the $600,000 loan proceeds, a cheque dated January 30, 2020, in the

amount of $46,164.72 payable to the order of Chenoy DDO¹¹⁶(as it should have been as

the borrower) was issued by the notary but according to Argyro, she erroneously

deposited the cheque in the bank account of DDO Restaurant instead of the bank account

of its true beneficiary, Chenoy DDO.

[312] In the “État des déboursements”¹¹⁷, the notary indicated that the proceeds of the

$46,164.72 cheque represented an “Avance aux administrateurs”.

[313] Argyro could not remember who actually asked the notary to issue that cheque

and whether it was issued because the lender would have given his permission, thus

ignoring completely the strict Orders of the Court.

[314] In any event, Argyro explained that the $46,164.72 were to refund advances made

in the past by DDO Restaurant to NKDS (the Country House).

[315] Then, why would Chenoy DDO use its own borrowed money destined for urgent

repairs to be carried on its building, and in contravention to the Court Order of October

28, 2019¹¹⁸, to “refund” debts due by NKDS to DDO Restaurant?

¹¹³Ibid.

¹¹⁴Ibid.

¹¹⁵P-2 of the Motion to lift the Safeguard Order in part of September 26, 2019.

¹¹⁶P-21B.

¹¹⁷CP-25A.

¹¹⁸ALLOWS and AUTHORIZES Chenoy Delicatessen & Steak House (1976) Ltd. to grant an immovable

hypothec against the Chenoy Property situated at 3616 St-Jean Boulevard, in the Municipality of Dollard-

des-Ormeaux to secure in favour of the lender a loan of up to $600,000 in capital with the strict

understanding that the proceeds of the proposed loan shall be used primarily to reimburse the two existing

hypothecary loans affecting the Chenoy Property in favour of the Scotia Bank and ICC and secondarily, to

carry out the repairs to the Chenoy Property situated at 3616 St-Jean Boulevard, in the Municipality of

Dollard-des-Ormeaux that were more fully described in Defendants’ “Motion to lift the Safeguard Order in

part” of September 26, 2019 [in reference to the estimates Exhibits P-2 to P-6]; [Emphasis added]

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[316] Needless to say, it was a godsend for DDO Restaurant that the proceeds of the

$46,164.72 cheque that belonged to Chenoy DDO were “erroneously” deposited in the

wrong corporate bank account.

[317] One thing was clear at trial, those funds did not belong to DDO Restaurant and

were not cashed by their rightful beneficiary Chenoy DDO, without mentioning that it was

carried out by Argyro in contravention to the Court’s express Orders.

[318] The same comment applies to a second cheque of $50,624.27 dated March 24,

2020, a copy of which was never produced despite the Court’s clear directions to that

effect. The notary who issued the cheque indicated as the reason for issuing the cheque

as “dépannage COVID (chq 6628)”.

[319] Argyro testified that the cheque was issued to assist DDO Restaurant who was

apparently experiencing serious financial difficulties due to the Covid-19 pandemic.

[320] How could DDO Restaurant incur financial difficulties to the tune of $50,000 within

only 10 days from the onset of the pandemic sanitary measures adopted by the

government of Québec on March 13, 2020?

[321] Again, the proceeds of $50,624.27 were not used in conformity with the Order of

October 28, 2019, to carry out urgent repairs to the building, but to reimburse or cover

instead some 50 cheques previously issued by DDO Restaurant to various third

parties¹¹⁹.

[322] Confronted with the foregoing, Argyro tried to deflect by answering that the Court

had authorized those cheques issued in January and March 2020, at the March 12, 2021,

hearing, which was not an accurate statement.

[323] Without a copy of the second cheque, the Court could not determine if the notary

issued the same to the order of its rightful beneficiary, the borrower Chenoy DDO, and

whether it was also “erroneously” deposited in the bank account of DDO Restaurant

although it appears to have served to cover debts linked to the restaurant operations, not

the landlord.

[324] The Court is sensitive to and can sympathize with the plight of business owners

trying to sail through the financial hardship caused by the Covid-19 pandemic.

[325] However, in the present circumstances, the $600,000 loan was authorized by the

Court over Jimmy’s objections, based upon the credence granted by the Court to Argyro’s

representations and undertakings as to the use of the borrowed funds given the necessity

of carrying-out specific repairs on an urgent and short-term basis, which somewhat

justified the higher estimates submitted.

¹¹⁹P-21B.

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[326] However, given the strict and yet clear wording of the Order of October 28, 2019,

the fact that Argyro was well aware that the undersigned was responsible for the case

management of this matter since 2017 and was easily accessible by email, if need be,

nothing could justify contravening to the specific Order of this Court without even trying

to seek a modification to said Order under the circumstances prevailing at the time.

[327] Moreover, throughout the relevant period, Jimmy was denied all the information

and documentation relating to the $600,000 loan and to the “urgent repairs” that his sister

was obliged to provide him, forcing to file additional legal proceedings with the Court.

[328] The foregoing is not the only such “incidence” noted by the Court.

3.14.5 The judgment of June 26, 2019, and the use of the insurance

proceeds paid to NKDS

[329] By judgment dated June 27, 2019, rendered at the behest of Defendants, the Court

ordered in the following terms Jimmy’s counsel to remit to Defendants’ counsel the

insurance proceeds received in connection with damages sustained to the Country

House:

ORDERS to Mtre Louis G. Brunet to issue a cheque from his trust account

representing the entire proceeds of a cheque of approximately $7,000 issued by

the insurance company in connection with damages sustained to the property

owned by NKDS Consultants & Investments Inc. and situated at 15 Chemin Frizzle

in Lac Brome (the “NKDS Property”) made payable to the order of Mtre David

Rosenzveig in trust;

[41] ORDERS Mtre David Rosenzveig to hold the said funds in his trust account

and to use them ultimately to make a payment directly to the contractor

retained by Defendant Argyro to perform the repairs to the NKDS Property

upon further authorization from this Court once the arrangements have been

finalized with the selected contractor;

[Emphasis added]

[330] During her cross-examination, Argyro was presented with a series of bank

statements of NKDS for the year 2019¹²⁰.

[331] The bank statements revealed that the account was essentially inactive for the

entire year with balances in the two digits.

[332] Being a director of NKDS and questioned about the account, Argyro indicated that

she did not know who operated that account although all cheques that were drawn upon

that account were bearing her own signature.

¹²⁰P-41.

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[333] On October 7, 2019, there was a deposit of $4,423.44¹²¹from an undisclosed

source. On October 21, a cheque of $4,390 was drawn on that account¹²².

[334] Argyro could not only explain the origin of the cheque and who had deposited it in

the NKDS bank account, but she was also at a loss to explain why she had signed a few

days later a NKDS cheque in the amount of $4,390 in order to withdraw those funds in

favour of her restaurant (DDO Restaurant)¹²³.

[335] On December 16, 2019, another deposit of $7,168.21 appears on the NKDS bank

statements with an annotation “ins”¹²⁴.

[336] On the same day, Argyro signed another NKDS cheque in the amount of $7,000

made to the order of her restaurant (DDO Restaurant)¹²⁵.

[337] Questioned about that cheque, Argyro answered, “It rings a bell”. The witness

believed that it may have been a cheque from the insurance company without being

certain.

[338] After a recess, the witness returned more assertive. The deposit came from the

insurance company. She immediately drew a cheque a $7,000 cheque payable to DDO

Restaurant for the simple reason that the latter had paid for the repairs without ever

producing any proof to that effect.

[339] The Court cannot help but to notice a strange resemblance between the deposit

of $7,168.21 representing an insurance indemnity by Argyro’s own admission and the

above-mentioned judgment rendered on June 27, 2019, at the specific request of Argyro

and her father, mentioning a cheque of approximately $7,000 issued by the insurance

company.

[340] In that judgment, there was an Order involving a cheque of approximately $7,000

from the insurer of NKDS directing Defendants’ lawyer to specifically use those insurance

proceeds to make a payment directly to the contractor retained by Argyro to perform the

repairs to the NKDS Country House upon further authorization from this Court once the

arrangements have been finalized with the selected contractor.

[341] Defendants never sought another authorization from this Court in connection with

the foregoing Order.

¹²¹Bringing the negative balance of—$8.29 to a credit of $4,415.15.

¹²²P-41, page 19.

¹²³Ibid., page 21.

¹²⁴Ibid., page 25.

¹²⁵Ibid., page 27.

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[342] Argyro did not provide any explanation about this other occurrence that suggests

that the Orders of the Court appeared to have been only respected when they were

convenient.

[343] In closing, the preponderant evidence strongly supported that Defendants used

the funds of the various Chenoy Corporations indiscriminately to fulfill on a punctual basis

whatever financial needs that required to be filled.

[344] Argyro was not wrong to describe her thinking and approach as follows:

“It was one big pocket.”

[345] It is not surprising that the various financial statements submitted to the Court

cannot be reasonably relied upon as it was echoed by the accountants who prepared

them and the experts who attempted to use or rely on the same.

ANALYSIS

THE LEGAL FRAMEWORK

[346] In the present instance, 114753, 114754, Chenoy Food Network, 136585, NKDS

and Chenoy DDO have all been constituted under the Canada Business Corporations Act

(“CBCA”) while DDO Restaurant was constituted under the Business Corporations Act

(Québec) (“QBCA”).

[347] In order to exercise an oppression remedy proceeding, the plaintiff must qualify as

a “complainant” within the meaning of section 238 CBCA which reads as follows:

238. In this Part,

complainant means

(a) a registered holder or beneficial owner, and a former registered holder or

beneficial owner, of a security of a corporation or any of its affiliates,

(b) a director or an officer or a former director or officer of a corporation or any of

its affiliates,

(c) the Director, or

(d) any other person who, in the discretion of a court, is a proper person to make

an application under this Part. (plaignant)

[Emphasis added]

[348] The Court finds that Jimmy, as a shareholder of 114753, NKDS and 136585, is a

complainant within the purview of section 238 CBCA. In light of the foregoing, the Court

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PAGE: 56

finds that he is also a complainant with respect of the affiliates of those corporations,

namely 114754, Chenoy Food Network and Chenoy DDO.

[349] The same conclusion applies to Jimmy’s standing vis-à-vis DDO Restaurant who

was constituted under the QBCA, which carries a similar definition at its section 439¹²⁶.

[350] Therefore, the Court finds that Jimmy has the proper standing to exercise the

present Oppression Remedy Application against Defendants Nicolas and Argyro as

directors of the Chenoy Mises-en-cause Chenoy Corporations at the time of its institution

and thereafter despite the passing of his father Nicolas.

[351] Based on the compelling evidence, the Court is of the opinion that Plaintiff Jimmy

was the object of multiple repeated acts of oppression overtime by Nicolas and Argyro,

acting as directors of the Chenoy Corporations.

[352] The foregoing does not necessarily mean that certain of the reproaches addressed

against Jimmy especially by his sister Argyro were devoid of any foundation.

[353] Nobody has clean hands in this protracted family dispute.

[354] Needless to say, the ever-increasing animosity and acrimony between the

Sigounis family members intermingled with mistrust and suspicion contributed

significantly to the present impasse which is insoluble, in the Court’s opinion without a

liquidation and dissolution.

[355] In other words, maintaining the status quo is not a reasonable and equitable

solution given the identity of the parties, their family ties, the incidence of Nicolas’s

passing, the issues raised as a result thereof and given the corporate financial mess left

behind by the deceased.

[356] As the expert retained by Plaintiff Jimmy, Mr. Patrice Dumais (“Dumais”) of the

firm BDO Canada (“BDO”), stated during his testimony:

Ça prend un divorce.

[357] Based on the evidence, whatever faults Argyro may attribute to her brother Jimmy,

they pale in comparison to her own actions and omissions and those of her father more

fully described previously.

¹²⁶439. Applications under subdivisions 2 and 3 may be made by any of the following:

(1) a registered holder or beneficiary, and a former holder or beneficiary, of a security of a corporation or

any of its affiliates;

(2) a director or an officer or a former director or officer of a corporation or any of its affiliates;

(3) any other person who, in the discretion of the court, has the interest required to make an application

under this division. [Emphasis added]

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[358] As a minority shareholder, Jimmy had reasonable expectations that his father and

his sister, as directors having interests direct or indirect in the Chenoy Corporations,

would conduct themselves in compliance with the governing laws and their fiduciary duty,

thus acting and making decisions in the best interest of the corporations that they were

serving as directors and in the best interest of all their shareholders, not just their own.

[359] Despite his majority interest, the Chenoy Corporations were not corporations

belonging to and controlled exclusively by Nicolas enabling him to act unilaterally and to

decide alone with the complicity and assistance of his daughter Argyro, especially when

his health became an increasing challenge for him.

[360] Nicolas purposely chose to operate his businesses within a corporate environment

given the many advantages that came with the same.

[361] As previously mentioned, such advantages came with obligations and duties that

could not be disregarded when convenient.

[362] Nicolas and Argyro were reminded rightfully so in no uncertain terms of the

limitations that corporate laws and regulations impose on shareholders by Kounadis their

corporate lawyer when they attempted to unilaterally transfer shares and the Chenoy’s

trademarks in 2016¹²⁷, by bypassing the usual corporate procedures and without seeking

the consent of Jimmy as director of the corporations affected by such proposed

transactions.

[363] Although the affairs of the Chenoy Corporations may have been conducted

somewhat loosely for many years, as there was harmony between the Sigounis family

members, the situation changed drastically with the Costas Oppression Lawsuit in 2013.

[364] The year before in 2012, Jimmy had unsuccessfully submitted his proposed plan

for restructuring the family businesses that were not performing as well as before.

[365] To settle the Costas Oppression Lawsuit who was seeking the liquidation and

dissolution of the Chenoy Corporations, Nicolas and Jimmy, inter alia, signed the Costas

Agreement which involved the orderly liquidation and dissolution of all Chenoy

Corporations including in particular those owning and/operating the Laval Property, the

Laval Restaurant, the DDO Property and the DDO Restaurant.

[366] At all relevant times, Jimmy was justified to entertain reasonable expectations that

his father would honour his word and his commitments especially when he signed

documents such as the Costas Agreement and later the Acknowledgment bearing in mind

that the latter document was executed by Nicolas in order to induce and convince Jimmy

to partake in the Costas Buy-out and to sign the Costas Release, as Jimmy’s presence

and involvement were crucial to complete the transaction with Costas.

¹²⁷See Chapter 3.11 above from paragraph 122.

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[367] The evidence leaves no doubt in the mind of the Court that since the Costas

Agreement of 2013, Jimmy always acted with the reasonable expectation that his father

would also proceed with the sale of the DDO Property just as he did with the Laval

Property.

[368] The Court also retains that since 2012, Jimmy was essentially motivated by the

overall financial situation of the group of Chenoy Corporations that no longer permitted a

profitable continuation of the operations including the Laval and DDO Restaurants,

bearing in mind that the Brossard Restaurant went bankrupt in 2015 and that all franchise

restaurants disappeared soon after without having paid any royalties for several years.

[369] The dire financial situation plaguing the Chenoy Corporations was further

evidenced by the attempts of Nicolas, with the complicity and assistance of Argyro, to

“strip”—as Jimmy qualified it—the remaining corporate assets to cover haphazardly

outstanding debts left and right, regardless of who or which company owed them while

attempting to shield those assets from apprehended “attacks” of creditors such as the

ARQ.

[370] As the valuable remaining assets were depleting rapidly, the financial woes of the

group of Chenoy Corporations became increasingly untenable to such an extent that

Nicolas even decided to resort on more than one occasion to obtain financing by getting

his wife Eleni to hypothecate her house, their family residence.

[371] Nicolas’s attempts culminated with a hypothecary loan of $760,000¹²⁸secured by

his wife’s residence on Marlatt Street contracted on June 4, 2018, his wife Eleni being an

elderly lady of venerable age who, after some 59 years of marriage, must now satisfy by

herself this significant financial obligation with only her basic pension.

[372] As to the remaining tangible assets, there is only the Country House that is

apparently in a serious state of disrepair and abandonment and finally, the DDO Property

which is the last asset of significant value with a substantial potential equity in the millions

of dollars based on the evidence adduced at the trial.

[373] However, that potential equity will remain untapped if Argyro’s will would have

prevailed with an order to buy out her brother Jimmy’s interests in the Chenoy

Corporations for a negative amount given his alleged and unsubstantiated personal and

corporate debts towards the various Chenoy Corporations.

[374] With all due respect, at this juncture, such an outcome is unrealistic under the

present circumstances. One does not determine the fair market value of shares before

accounting for the amounts due by a shareholder to the corporation and vice versa.

[375] As tensions, disagreements and disputes grew within the Sigounis family with the

passage of time and the lack of significant developments regarding the implementation

¹²⁸P-25.

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of the Costas Agreement, Nicolas, with the complicity and assistance of Argyro, could no

longer continue to manage the Chenoy Corporations as he (they) did in the past when

there was a consensus.

[376] Under such circumstances, the laws regulating the corporate structure of the

Chenoy businesses imposed upon the directors an increased obligation to manage and

make decisions openly and in the best interest of those corporations and of their

shareholders despite their disagreements and disputes.

[377] In other words, after the execution of the Costas Agreement, Nicolas, always

relying on the complicity and assistance of Argyro, could not carry-on as before by simply

ignoring Jimmy as co-director and making unilateral decisions in his absence and without

his consent.

[378] Jimmy was justified to reasonably expect that as a director, his co-directors,

Nicolas and Argyro, would consult with him before making any major decisions that were

within the realm of the board of directors. This did not necessarily imply that Jimmy had

a right of veto, thus justifying their decision to bypass him completely.

[379] Finally, as previously discussed, the Court cannot accept Argyro’s argument that

the Court should disregard the documents executed by her father such as the Costas

Agreement and the Acknowledgment as they did not have any more value in her father’s

mind once the Costas Buy-out was completed and the threats resulting from Costas’

oppression remedy proceedings no longer existed.

[380] Argyro suggested that her father only signed those documents to essentially buy

the peace with his brother Costas with respect to his oppression remedy proceedings and

to convince Jimmy—whose presence and consent were crucial and essential to complete

the Costas Buy-out—to sign the Costas Release which finally put an end to Nicolas’s

dispute with his brother.

[381] Argyro added that regardless of the clear provisions of the Costas Agreement

relating to the DDO Property and the DDO Restaurant, her father subsequently changed

his mind and no longer wanted to sell the DDO Property and close the restaurant since

Costas no longer constituted a threat, being completely out of the remaining Chenoy

Corporations.

[382] If the foregoing was true, Nicolas would have induced Jimmy to partake in the

Costas Buy-out by using deception and false promises.

[383] Be that as it may, if contractual documents signed by her father Nicolas ceased to

be binding on him by allegedly simply changing his mind subsequently, as suggested by

Argyro, how can she be certain that her father did not also change his mind after

transferring his Shares to her by allegedly signing the Confirmations?

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[384] Without expressing any opinion on the validity of the Confirmations allegedly

executed on December 8, 2019, by Nicolas¹²⁹, Argyro’s testimony purported to contradict

on more than one occasion the content of those documents always based on statements

apparently made afterwards to her by her father.

[385] Again, did Nicolas change his mind after signing the Confirmations especially

insofar as the financial terms and conditions stated therein no longer applied, according

to Argyro?

[386] This leads the Court to the other main argument put forward by Argyro that at all

relevant times, her father wanted her to “have” or to “get” the DDO Restaurant, always

implying that she did not have to pay for it.

[387] With all due respect, at this juncture, the Court cannot give any significant weight

to such an argument that based on the preponderant evidence, was contradicted on more

than one occasion by her father and by herself.

[388] Firstly, if at all relevant times, Argyro was to be “given” the DDO Property why did

she submit offers to buy the same in 2014 and then in 2016, with the last one even being

accepted under her father’s signature¹³⁰?

[389] The Costas Agreement of December 2013 provided for the sale of the DDO

Property and did not stipulate that it belonged to Argyro outright or that it was destined to

be hers at no cost.

[390] In fact, the Court finds that, in all likelihood, the offers submitted by Argyro in 2014

were as a direct result of the Costas Agreement of December 2013 which specifically

provided that any and all Sigounis family members are free to bid upon the said properties

[the Laval and DDO Properties] as they see fit¹³¹?

[391] Secondly, the simple wish expressed by her father, albeit repeatedly apparently,

to “give” the DDO Property and the DDO Restaurant to his daughter could not be

implemented by his sole will just as if the corporate structures governing those assets no

longer existed or applied to them.

[392] With all due respect, Argyro and Nicolas had to operate and act within the

corporate structures created by the latter. Purposely omitting to act accordingly did not

only constitute oppression towards the minority shareholders including Jimmy, but against

him as well as co-director of Chenoy DDO, 136585 and NKDS in particular.

¹²⁹DIC-8A and DIC-8B.

¹³⁰P-31.

¹³¹P-2, clause 5 b.

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[393] All in all, the preponderant evidence is replete with continued and repeated acts of

oppression of Nicolas and Argyro towards Jimmy within the purview of section 241 (2)¹³²

CBCA that warrants the application of remedies:

i. Refusal to implement the winding-up agreement (the Costas Agreement¹³³);

ii. Failure and refusal to respect the agreements reached regarding the Costas

Buy-out including the Acknowledgment¹³⁴;

iii. Unauthorized financing of the Country House (NKDS)¹³⁵;

iv. Unlawful attempts to transfer assets (shares of Chenoy Food Network Inc. and

intellectual property (NKDS))¹³⁶;

v. Refusal to consider third-party offers to purchase the DDO Property in order to

advantage Defendant Argyro;

vi. Unauthorized execution and publication of a lease for DDO Property¹³⁷;

vii. Undisclosed appropriation and use of corporate funds for unauthorized

purposes, to the advantage of Defendants, and to the prejudice of Plaintiff¹³⁸;

viii. Appropriation and use of funds in contravention to the Court’s Orders¹³⁹;

ix. Failure to disclose financial transactions and obtain the proper authorizations¹⁴⁰:

x. Failure to render any accounting whatsoever regarding the operations of the

DDO Restaurant.

THE APPROPRIATE REMEDIES

¹³²241 (2) If, on an application under subsection (1), the court is satisfied that in respect of a corporation

or any of its affiliates

(a) any act or omission of the corporation or any of its affiliates effects a result,

(b) the business or affairs of the corporation or any of its affiliates are or have been carried on or

conducted in a manner, or

(c) the powers of the directors of the corporation or any of its affiliates are or have been exercised

in a manner

that is oppressive or unfairly prejudicial to or that unfairly disregards the interests of any security holder,

creditor, director or officer, the court may make an order to rectify the matters complained of.

¹³³P-2.

¹³⁴P-26.

¹³⁵P-10.

¹³⁶P-11.

¹³⁷P-20, P-29, P-29A and P-29B.

¹³⁸Re Van-Tel T.V. Ltd., 1974 CanLII 1219 (BC SC)

¹³⁹Walek v. Guardian Storage Inc., 2013 BCSC 750, paragraphs 3 and 4.

¹⁴⁰HSBC Capital Canada Inc. v. First Mortgage Alberta Fund (V) Inc., 1999 ABQB 406, paragraph 45.

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[394] In the presence of acts of oppression towards a complainant, the provisions of

section 241 CBCA grant to the Court broad powers¹⁴¹to remedy the situation affecting a

shareholder like in the present instance:

241 (3) In connection with an application under this section, the court may make

any interim or final order it thinks fit including, without limiting the generality of the

foregoing,

(a) an order restraining the conduct complained of;

(b) an order appointing a receiver or receiver-manager;

(c) an order to regulate a corporation’s affairs by amending the articles or by-laws

or creating or amending a unanimous shareholder agreement;

(d) an order directing an issue or exchange of securities;

(e) an order appointing directors in place of or in addition to all or any of the

directors then in office;

(f) an order directing a corporation, subject to subsection (6), or any other person,

to purchase securities of a security holder;

(g) an order directing a corporation, subject to subsection (6), or any other person,

to pay a security holder any part of the monies that the security holder paid for

securities;

(h) an order varying or setting aside a transaction or contract to which a corporation

is a party and compensating the corporation or any other party to the transaction

or contract;

(i) an order requiring a corporation, within a time specified by the court, to produce

to the court or an interested person financial statements in the form required by

section 155 or an accounting in such other form as the court may determine;

(j) an order compensating an aggrieved person;

(k) an order directing rectification of the registers or other records of a corporation

under section 243;

(l) an order liquidating and dissolving the corporation;

(m) an order directing an investigation under Part XIX to be made; and

(n) an order requiring the trial of any issue.

[Emphasis added]

¹⁴¹Section 451 QCBA grants similar broad powers to the Court.

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[395] In a recent judgment in the case of Gestion Simon-Pierre Péladeau inc. v.

Placements Péladeau inc.¹⁴², the Court of Appeal reminded us that the broad powers

conferred by section 451 QBCA offer means to the Court to find logical and equitable

solutions to remedy acts of oppression once they have been established as in the case

at hand:

[76] Les pouvoirs conférés au tribunal par l’article 451 L.s.a.Q. afin de corriger une

situation d’oppression sont vastes. Ces pouvoirs permettent au tribunal de

trouver des solutions logiques et équitables afin de pallier aux situations

d’oppression lorsqu’elles sont établies. Ils comprennent notamment le pouvoir

d’enjoindre la société d’acheter des valeurs mobilières d’un détenteur et de

modifier, résilier ou annuler un contrat auquel la société est partie65. C’est là la

conclusion principale du recours entrepris par l’appelante, soit une ordonnance de

rachat immédiat de la totalité de ses actions de classe B-1 détenues dans PPI, et

ce, sans égard à la formule de rachat prévue dans l’Entente de 2008.

[Emphasis added]

[396] The same concept applies to the broad powers found in section 241 (3) CBCA.

[397] The overwhelming evidence convinces the Court that the status quo is definitely

not an option. It is obvious that the parties cannot continue to remain co-shareholders in

the Mis-en-cause Chenoy Corporations since it is impossible for them to get along (mainly

as a result of the oppressive conduct of Defendants) and as a result thereof:

i. No shareholders and directors’ meetings have been held for numerous years;

ii. Proper financial statements and tax filings have not been made for numerous

years.

[398] All in all, the Court finds that the present situation commands a decisive solution

given the clear impasse in which the members of the Sigounis family find themselves

regarding the Chenoy Corporations.

The proposed buy-out of Jimmy’s shares by Argyro and the Schulman

Expert Report

[399] Given the passing of the Late Nicolas and the unresolved contested transfer of his

Shares to his daughter Argyro, the proposed buy-out of Jimmy’s shares rests exclusively

upon Argyro who admittedly does not own funds to effect such a buy-out, save and except

for a somewhat nominal amount which is not acceptable nor realistic under the present

circumstances.

[400] Moreover, no reliable evidence has been presented as to the fair market value of

Jimmy’s shares since Defendants’ expert reports are based on questionable unaudited

¹⁴²2021 QCCA 956.

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financial statements and no witness has testified to substantiate convincingly in any way

the figures appearing in said financial statements.

[401] With all due respect, the testimony of Defendants’ expert Mr. Stanley L. Schulman

(“Schulman”) and his reports¹⁴³are not of any assistance to the Court to determine the

fair market value of Jimmy’s shares for the purposes hereof and cannot be reasonably

relied upon.

[402] The finances of most of the Chenoy Corporations are a mess and the financial

statements produced are unreliable in the eyes of the Court.

[403] In fact, accountant Jack Shostak (“Shostak”) who prepared the financial

statements for the Chenoy Corporations since at least 2000 until 2017, based on financial

records supplied by the in-house accountant Mr. Marvin Segal (“Segal”), testified that the

companies were not in good shape.

[404] Shostak added that nothing conclusive could be drawn from those financial

statements as it was not possible to prepare reconciliations in relation to financial

statements of each of the Chenoy Corporations.

[405] To paraphrase Argyro’s testimony on more than one occasion, for her and her

father the assets and bank accounts of the corporations were “one big pocket”.

[406] The evidence revealed that as Nicolas needed funds, unencumbered assets were

hypothecated and the loan proceeds served indiscriminately to cover debts and liabilities

left and right, personal and corporate, without any regards as to which corporation was

the source of the funds.

[407] When the equity in the corporate assets was totally depleted—without touching

the remaining equity of the DDO Property—Nicolas ultimately caused his wife Eleni to

sign a deed of hypothecary loan in the amount of $760,000 against her residence on

Marlatt Street in Montreal¹⁴⁴while ensuring that Argyro would have full access to the

available borrowed funds.

[408] The expert Schulman testified that he prepared his report of September 18,

2018¹⁴⁵(the “Schulman Report”) based on draft financial statements for four of the seven

Chenoy Corporations for the year 2017. The others were unaudited financial statements.

He did not see any of the tax returns nor was he provided with any other information.

[409] For his undated updated report¹⁴⁶, Schulman was only provided with unaudited

financial statements for Chenoy DDO and DDO Restaurant as at January 31, 2020.

¹⁴³CP-32 and CP-32A.

¹⁴⁴P-25.

¹⁴⁵CP-32.

¹⁴⁶CP-32A.

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[410] Schulman concluded that the Chenoy Corporations had a negative worth as a

group with the only value in the DDO Property belonging to Chenoy DDO, pointing out

that its location contributed greatly to its value.

[411] With respect to NKDS, he wrote off the building value of the Country House without

providing further details and valued the company at $0.

[412] Schulman’s conclusions regarding his estimated value of Jimmy’s shares did not

account for the Acknowledgment executed by Nicolas in favour of Jimmy¹⁴⁷which he was

unaware of and that brought Jimmy’s shareholding from 30% to 40% in 136585 and to

33^1/3% in NKDS.

[413] Ultimately, Schulman concluded that Jimmy’s share that the expert described as

“Share of DDO operations¹⁴⁸” was $176,867 based on a 30% shareholding in 136585¹⁴⁹.

[414] This estimated value was only reached on the assumption that the DDO Property

and the operations of the DDO Restaurant would be sold as a going concern with a net

value for the land of $859,474 based on the 2017 municipal evaluation of $2,092,000.

[415] Then, being unable to determine any of the amounts due to Jimmy by the Chenoy

Corporations, Schulman identified potential debts due by certain of Jimmy’s own

companies to NKDS, Chenoy Food Network and DDO Restaurant¹⁵⁰leaving a global net

indebtedness of $424,423.

[416] The expert then deducted from Jimmy 30% “Share of DDO operations”

($176,867), the alleged debts of his two corporations of $424,423 apparently due to

NKDS, Chenoy Food Network and DDO Restaurant leaving a negative balance of

($247,556).

[417] In other words, Schulman led the Court to conclude that under any potential

scenarios, Jimmy would never be entitled to any payment for his shares in the Chenoy

Corporations.

[418] Questioned by the Court, as he attributed no value to NKDS, the expert recognized

that since Jimmy holds 40% of the shares in 136585, any buy-out of those shares would

necessarily have to be made through that corporation who is the one holding 40% of the

shares in Chenoy DDO. Under such circumstances, there would not be any deduction of

the buyout price to be paid to 116585 on account of the alleged debts of Jimmy and/or of

his own companies.

¹⁴⁷P-26.

¹⁴⁸CP-32, page 7.

¹⁴⁹Ibid., Exhibit 21, page 140.

¹⁵⁰Ibid., Exhibit 22, page 141.

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[419] In any event, shouldn’t debts due to or due by the Chenoy Corporations be

considered in the determination of their share fair market value and not applied after such

a value has been determined?

[420] With all due respect, the Schulman Report is based on unaudited (mostly drafts)

financial statements¹⁵¹several of which are contested. Unfortunately, it appeared to be a

futile attempt to make sense of the financial situation of the Chenoy Corporations as at

January 31, 2017, with a slew of questionable money intercompany transfers or

shareholders loans.

[421] Moreover, the exercise seemed to focus mainly on trying to find or identify

receivables that could be due to the Chenoy Corporations by Jimmy or by his own

companies that are not part of the group of Chenoy Corporations in order to justify that

Jimmy was not entitled to any amount for his shares.

[422] In his updated (but undated) report, Schulman commenting the expert report filed

by Jimmy’s expert, BDO Canada¹⁵², concluded that Jimmy’s shares were worth

$11,545¹⁵³after deducting the same debts of $424,423 mentioned above with an

estimated 30% share value of $435,968¹⁵⁴. The value would have had to be increased to

$581,291 with a 40% shareholding instead of 30%, as it should be.

[423] The paucity and the unreliability of the financial information used by the expert and

his approach do not enable the Court to reasonably conclude that Jimmy’s shares are

worthless or only have a nominal value in the vicinity of $11,000.

[424] All in all, it appears that the expert was provided with minimal and yet, incomplete,

and unreliable information and documentation to execute his mandate with a view to

seemingly determine a negative value of Jimmy’s shares under all circumstances.

[425] With all due respect, the Schulman Reports cannot be considered by the Court to

determine the fair market value of Jimmy’s shares or a buy-out figure for his interest in

the Chenoy Corporations.

[426] Under the present circumstances, the proposed buy-out of Jimmy’s shares does

not constitute a logical and equitable solution to remedy the acts of oppression in

question.

[427] Moreover, determining the fair market value of Jimmy’s shares is not necessary

once the Court has determined that the liquidation and dissolution of the Chenoy

¹⁵¹Some of which were drafts.

¹⁵²P-38.

¹⁵³CP-32A, page 5.

¹⁵⁴Based on the 2020 municipal evaluation of $2,405,800.

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PAGE: 67

Corporations is the most logical and equitable solution under the present circumstances,

which is the case.

[428] In any event, a buy-out of Jimmy’s position - even at the proper fair market value

- would not resolve in a definitive manner the other issues stemming from the Sigounis

family disputes insofar as the Chenoy Corporations are concerned.

[429] Jimmy is not the only one to hold interests in the Chenoy Corporations. Although

remaining silent throughout the proceedings, his sister Mise-en-cause Amalia

nevertheless also holds 20% of shares in 136585.

[430] And, to the extent that she has a say therein, which shall be determined at a later

date, DICS Eleni as Liquidator and as Universal Legatee who has not yet opted, objects

to Argyro’s proposed outcome favouring instead the liquidation and dissolution of the

Chenoy Corporations that still hold assets of value in order to enable her to execute her

mandate as Liquidator of the Estate of her late husband and deal, inter alia, with his debts

and liabilities.

The BDO Expert Report of May 10, 2019

[431] Expert accountant Dumais presented his expert report of behalf of BDO¹⁵⁵(the

“BDO Report”).

[432] His expert report purported to respond and comment the Schulman Report.

Dumais estimated that based on the financial information provided to him that Jimmy’s

shares had a fair market value ranged between $443,900 and $589,400 depending on

his shareholding in 136585 (30% or 40%) with a potential to reach $654,535¹⁵⁶.

[433] With all due respect, although more detailed and somewhat more useful, overall,

the BDO Report is nevertheless based on the same unreliable financial information used

by Schulman, which affects Dumais’ estimations in the opinion of the Court.

[434] However, the BDO Report enables the Court to conclude that Jimmy’s

shareholding in the Chenoy Corporations is significantly more than negative or nominal

value suggested by Argyro and by her expert.

The DDO Property at 3616 Saint-Jean Boulevard, in Dollard-des-

Ormeaux

[435] The Court understands that the municipal valuation of the DDO Property is

presently at $2,405,800¹⁵⁷.

¹⁵⁵P-38.

¹⁵⁶Ibid., page 17/52.

¹⁵⁷P-39A.

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PAGE: 68

[436] For the preparation of the BDO Report, Dumais obtained from Cushman &

Wakefield (“C&W”) a professional appraisal of the DDO Property dated May 7, 2019¹⁵⁸

(the “C&W Appraisal”). The DDO Property is summarily described as follows:

The subject property is improved with a single-tenant, freestanding retail building,

originally built in 1973, and comprising a total Net Rentable Area (NRA) of 5,767 sf.

The site contains approximately 52,808 sf of land.¹⁵⁹

[437] C&W also made the following preliminary comments:

ln our analysis, we have derived the “As ls” and “As If Vacant” market values for

internal valuation purposes.

It is an inherent assumption of this report that the tenant remains in place and that

all rent that is due is payable in accordance with its respective terms and

conditions.¹⁶⁰

[Emphasis added]

[438] Based on the foregoing assumptions, C&W expressed the opinion that the DDO

Property had the following estimated value:

- The “As ls¹⁶¹” market value of the subject property, as of May 1, 2019, was TWO

MILLION FIFTY THOUSAND DOLLARS ($2,050,000); and

-

The “As If Vacant¹⁶²” market value of the land on a Fee Simple interest in the

subject property as of May 1, 2019, was estimated at FOUR MILLION DOLLARS

($4,000,000) based on a 6 to 9-month exposure period.

[439] Needless to say, the DDO Property in the As If Vacant state, had in 2019, an

estimated value of 2 million dollars more rather than if sold As Is.

The offers made in connection with the DDO Property

[440] The Court has previously discussed the various offers made in 2014 and in 2016

in connection with the DDO Property, offers that never led to a fruitful conclusion given

Nicolas’s refusal to seriously consider the same despite his clear undertaking evidenced

¹⁵⁸P-38B.

¹⁵⁹Ibid., page 2.

¹⁶⁰Ibid.

¹⁶¹The “As ls” market value does not consider the redevelopment potential or expansion potential of the

subject property. (P-38B, page 3)

¹⁶²The “As If Vacant” market value considers the current zoning for commercial use and 2 times density,

as well as the City of Montreal Master Plan which may allow for up to 8-storeys of housing on the subject

site. Based on the assumption of 40% site coverage approved subject to a special project approval, we

have estimated the total buildable density at 3 times land area. We understand any special project

approval in accordance to the Master Plan would be subject to social and affordable housing

requirements. (P-38B, page 3)

500-11-052150-170

PAGE: 69

in the Costas Agreement of December 2013¹⁶³to proceed to the wind-up of the affairs

and operations and to the liquidation of the assets of, inter alia, Chenoy DDO and DDO

Restaurant including the sale of the DDO Property¹⁶⁴.

[441] Be that as it may, in addition to the C&W Appraisal of May 2019, the evidence

revealed the existence of several offers obtained by Eleni in her capacity as Liquidator of

the Estate of her late husband from 2020 onwards:

- Sonny Dandona and/or nominees¹⁶⁵- $4.5M - Nov. 2020¹⁶⁶

- 9425-9298 Québec Inc.¹⁶⁷– $4.6M - Aug. 7, 2021¹⁶⁸

- 9425-9298 Québec Inc.¹⁶⁹– $5M - Oct. 21, 2021¹⁷⁰

- GPA Motor Trade Inc. – $5M - Oct. 26, 2021¹⁷¹

- Sonny Dandona and/or nominees¹⁷²- $5.7M - Oct. 28, 2021¹⁷³

[442] Argyro’s counsel endeavoured to discount, if not to discard totally, those offers on

the grounds that firstly, the DDO Property is not for sale. Secondly, Eleni had no authority

to seek or to entertain, let alone accept any offer to sell the DDO Property belonging to

Chenoy DDO.

[443] With all due respect, the Court did not perceive these offers as an illegal attempt

on Eleni’s part to sell the DDO Property that does not belong to her.

[444] The Court agrees with Eleni’s counsel that those offers constitute a compelling

indication of the commercial potential and value of the DDO Property which appears to

generate interest among potential commercial buyers.

[445] The Court has no reason to believe that those offers are unreliable manipulations

orchestrated by Eleni or by Jimmy and that they should be disregarded completely.

[446] Be that as it may, the Court retains from the preponderant evidence that given its

prime location on Boulevard Saint-Jean in Dollard-des-Ormeaux and its significant size

of 52,808 square feet, the latest offers reaching $5,7 M offer a reasonable indication of a

¹⁶³P-2.

¹⁶⁴Ibid.

¹⁶⁵Offer made via Colliers International (Québec) Inc.

¹⁶⁶DIC-9.

¹⁶⁷For Services d’ophtalmologie Boulos & Falcao Inc.

¹⁶⁸DIC-10.

¹⁶⁹For Services d’ophtalmologie Boulos & Falcao Inc.

¹⁷⁰DIC-23.

¹⁷¹DIC-27.

¹⁷²Offer made via Colliers International (Québec) Inc.

¹⁷³DIC-28.

500-11-052150-170

PAGE: 70

potential value that far exceeds the existing $600,000 hypothecary loan previously

authorized by the Court in late 2019.

[447] There lies the remaining but sizable potential equity of the Chenoy Corporations.

[448] Based on the foregoing, the Court finds that under the present circumstances and

the total impasse or deadlock between the members of the Sigounis family who still have

an interest or a potential interest in the Chenoy Corporations, the only logical and

equitable solution to remedy the acts of oppression sustained by Jimmy is to order the

liquidation and dissolution of the six Mises-en-cause Chenoy Corporations governed by

section 241 (3) (l) CBCA.

[449] Such a solution is not only the logical and equitable one, but it follows the collective

agreement as well concluded in December 2013 that was evidenced with the Costas

Agreement entered into to avert and settle the Costas Oppression Lawsuit.

[450] The Court bears in mind that this contractual document constituted a binding

transaction between all the parties who signed the same each of them being represented

by counsels who also signed the same. The parties to the Costas Agreement were

Costas, Nicolas and Jimmy personally as well as Chenoy DDO, DDO Restaurant, NKDS,

Chenoy Food Network, the holding company 136585, and 114753 (Laval Property) and

114754 (Laval Restaurant) all acting through duly authorized representatives (directors)

and counsels.

[451] Although Argyro did not sign the Costas Agreement, the document offers evidence

that she participated to at least one of the meetings that lead to its conclusion and signing:

WHEREAS pursuant to the said meetings, the parties have reached an agreement

on a modus operandi in view of the orderly winding up of the affairs and operations

and liquidation the asset of Charcuterie & Grilladerie Chenoy (1976) Ltd.,

Charcuterie & Grilladerie Chenoy Inc., Chenoy Food Network Inc., 114753

Canada Inc., 114754 Canada Inc., Consultations & Placements N.K.D.S. Inc. and

136585 Canada Inc. (hereafter “the Chenoy’s Group”) in accordance with the

terms set forth herein below: […]

[452] With all due respect, it is not sufficient for Argyro to argue that from the outset, she

never agreed to the terms and conditions of the Costas Agreement to justify that Chenoy

DDO and DDO Restaurant are not bound by the same.

[453] In fact, the preponderant evidence establishes the opposite given the offers that

Argyro submitted shortly thereafter. If Argyro was in disagreement, she did not voice it at

the time.

[454] Finally, the fact that her father may have possibly changed his mind subsequently

as suggested by Argyro, did not relieve him from the obligations that Nicolas contracted

500-11-052150-170

PAGE: 71

in December 2013 evidenced by his own signature appearing on the Costas Agreement

and the Acknowledgment among others.

The most logical and equitable solution to provide proper and fair relief

from the acts of oppression sustained by Plaintiff Jimmy Sigounis

[455] The Court finds that the most logical and equitable solution to provide proper and

fair relief from the acts of oppression sustained by Plaintiff Jimmy is to order the liquidation

and dissolution of the six Mises-en-cause Chenoy Corporations that are governed by the

Canada Business Corporations Act, namely:

- 114753 Canada Inc.;

- 114754 Canada Inc.;

- 136585 Canada Inc.;

- Chenoy Food Network Inc.;

- N.K.D.S. Consultants & Investments Inc.; and

- Chenoy Delicatessen & Steak House (1976) Ltd.

[collectively the “CBCA Chenoy Corporations”]

[456] The liquidation and dissolution of the CBCA Chenoy Corporations shall proceed

under the Court supervision pursuant, inter alia, to the applicable provisions of the CBCA.

[457] The seventh corporation Chenoy Delicatessen & Steak House Inc. who operates

the DDO Restaurant is governed by the Québec Business Corporations Act and shall be

the object of a different temporary treatment given the fact that it is the only Chenoy

Corporation that is still in operation, but also bearing in mind that it is wholly owned by

Chenoy DDO who is going to be liquidated and dissolved.

[458] Before the Court makes a final determination with respect to Chenoy Delicatessen

& Steak House Inc. (DDO Restaurant), the Court shall require the opinion and

recommendations of the Court-appointed Liquidator as to its proposed approach to

optimize if not maximize the realization proceeds of Chenoy Delicatessen & Steak House

(1976) Ltd. (Chenoy DDO) who owns the DDO Property and all the shares of DDO

Restaurant.

[459] In the execution of this particular mandate, the Court expects the Liquidator to,

inter alia, review and assess the financial situation and profitability of Chenoy

Delicatessen & Steak House Inc. (DDO Restaurant) with a view to determine the optimal

manner to deal with and dispose of the DDO Property and the shares held by Chenoy

DDO which may possibly involve the restaurant operations.

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PAGE: 72

[460] Based on the foregoing, the Court shall therefore reserve to a later date its

determination of the most logical and equitable solution with respect to Chenoy

Delicatessen & Steak House Inc. (DDO Restaurant).

[461] Until then, the Court expects that Argyro shall pursue the operations of the DDO

Restaurant under the supervision of a court-appointed Monitor in execution of the

particular mandate to be granted by the Court. Under such a scenario, the Court expects

Argyro to cooperate fully with the Monitor who will not be involved in the operations of the

restaurant.

The appointment by the Court of a Liquidator to the CBCA Chenoy

Corporations

[462] During the trial, Jimmy and Argyro proposed equally capable and competent

professional liquidators who both indicated their agreement to act if appointed Liquidator

of the Chenoy Corporations by the Court.

[463] Exercising its judicial discretion pursuant to the applicable provisions of the CBCA,

the Court shall appoint Raymond Chabot Inc. represented by Mr. Jean Gagnon, CPA,

CA, CIRP, SAI¹⁷⁴to act as Liquidator (the “Liquidator”) to the six CBCA Chenoy

Corporations in accordance with the terms and conditions more fully set out in the

conclusions of this judgment.

The liquidation and dissolution of Chenoy Delicatessen & Steak House

(1976) Ltd. (Chenoy DDO) and its incidence on the operations of the

DDO Restaurant by Chenoy Delicatessen & Steak House Inc.

[464] As previously mentioned, the Court finds it premature to order the outright

liquidation and dissolution of Chenoy Delicatessen & Steak House Inc. (DDO Restaurant)

without obtaining beforehand additional information on its financial situation and

profitability including the potential avenues to consider in order to maximize the liquidation

and realization of the DDO Property and the shares held by Chenoy Delicatessen & Steak

House (1976) Ltd. in Chenoy Delicatessen & Steak House Inc. given its current state of

operation.

[465] Be that as it may, based on the evidence adduced at trial, the Court entertains

serious concerns about the financial situation and profitability of the DDO Restaurant.

[466] With all due respect, Argyro’s testimony did not alleviate the Court’s legitimate

concerns, on the contrary.

¹⁷⁴CP-31.

500-11-052150-170

PAGE: 73

[467] Again, the evidence revealed that Argyro was drawing money wherever and

whenever she could find available funds regardless of which corporation owned the funds

that she sought at any given time.

[468] So far, the preponderant evidence including the highly questionable, unaudited

financial statements too often produced “au compte-goutte” even at trial, supports

Jimmy’s position that Chenoy Delicatessen & Steak House Inc. (DDO Restaurant) has

yet to generate any real profit, let alone a profit sufficient to declare and pay any dividend

to Chenoy Delicatessen & Steak House (1976) Ltd.

[469] The Court found particularly troubling the “liberal” use (or possible misuse or

abuse) by Argyro of funds belonging to Chenoy DDO to the benefit of DDO Restaurant.

[470] The Court has already discussed its findings with respect to the unauthorized use

of certain of the proceeds of the Court authorized $600,000 loan secured with the DDO

Property belonging to Chenoy DDO.

[471] Another area of concern is the rent payable by the tenant DDO Restaurant to

Chenoy DDO the landlord pursuant to the June 1, 2016, Lease¹⁷⁵and the other financial

obligations of the tenant under this “triple net” Lease, which incidentally expired on June

30, 2021, with no evidence adduced at trial that it was extended beyond that date.

[472] Other than its shares in DDO Restaurant, the sole asset that generates revenues

for Chenoy DDO is the DDO Property via the Lease entered into with the tenant.

[473] Based on the partial documentary evidence¹⁷⁶, the base monthly rent of $9,000¹⁷⁷

and the additional monthly rent of $4,000¹⁷⁸was never paid on time (on the first day of

each month) nor was it ever paid in full. Moreover, there are several cheques signed by

Argyro drawing the funds ($27,800¹⁷⁹) out of the Chenoy DDO bank account in favour of

DDO Restaurant.

[474] At first, Argyro could not remember why all these withdrawals were made

seemingly against the monthly rental paid to the landlord. After a recess, Argyro explained

that she needed to borrow those funds to pay for the DAS, QST and GST that DDO

Restaurant owed to the tax authorities.

[475] The Lease provides for the payment of an additional monthly rent of $4,000 to

serve to cover the real estate and school taxes that must be paid by DDO Restaurant in

connection with the DDO Property.

¹⁷⁵P-29.

¹⁷⁶P-40, P-42 and P-43.

¹⁷⁷Plus applicable taxes.

¹⁷⁸Ibid.

¹⁷⁹P-43.

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PAGE: 74

[476] Based on Exhibit P-43, the Scotia Bank monthly statements of Chenoy DDO from

December 31, 2019, to September 29, 2021, reveal total deposits of $149,656.

[477] During that 9-month period, the following payments totalling $154,255.92 were

made by Chenoy DDO against said total deposits of $149,656:

- $27,800 back to DDO Restaurant;

- $45,000 to Gestion Bartolini, the mortgage lender;

- $80,256.37¹⁸⁰to the City of Dollard-des-Ormeaux on account of real estate taxes;

- School taxes: $1,199.55.¹⁸¹

[478] Given that the annual provision for real estate and school taxes is $48,000 ($4,000

per month), the payments made by Chenoy DDO on account of those taxes totalling

$81,455.91 from May 26, 2021, to September 13, 2021, clearly exceed that provision.

[479] Yet, with a last payment made by Chenoy DDO to the City of Dollard-des-Ormeaux

with a cheque #0248 dated September 13, 2021, in the amount of $20,315.10 that was

cashed on September 17, 2021¹⁸², a statement issued by the City on October 19, 2021,

revealed that it was in default to make an instalment of $39,941,26¹⁸³.

[480] Given the fact that Argyro acts for Chenoy DDO and DDO Restaurant and is their

sole authorized signatory, Chenoy DDO acts, in all appearances, as a banker of DDO

Restaurant by allowing the latter to regularly recover a good portion of the rent paid.

[481] In light of the foregoing, the Court has even more serious doubts about the

reliability and accuracy of the unaudited financial statements produced for the first time

on the tenth day of the trial via the accountant Ronald Gluck (“Gluck”) that reveal for the

years 2018, 2019 and 2020, inter alia, Chenoy DDO’s rent revenues were exactly

“$156,000” for each year.

[482] Moreover, by judgment dated June 27, 2019¹⁸⁴, the Court granted an Application

filed by Argyro and Nicolas seeking to appoint the accountant Gluck to prepare and

finalize the financial statements for the years ending on January 31, 2018, and 2019 for

the following corporations:

- 136585 Canada Inc.;

- Chenoy Delicatessen & Steak House Inc.;

¹⁸⁰Payments made from May 26, 2021, to September 13, 2021.

¹⁸¹P-43.

¹⁸²Ibid., page 33.

¹⁸³P-39A.

¹⁸⁴2019 QCCS 2725.

500-11-052150-170

- Chenoy Delicatessen & Steak House (1976) Ltd.;

PAGE: 75

- Chenoy Food Network Inc.;

- NKDS Consultants & Investments Inc.;

[483] As incredible as it may seem, during his testimony of October 25, 2021, Gluck

indicated that neither Argyro, Nicolas nor their counsel ever gave him a copy of the June

27, 2019, judgment that had been rendered at their own behest…

[484] Defendants only communicated with Gluck via intermediaries (Howard Baron

(“Baron”) and Marvin Segal (“Segal”)).

[485] Gluck was not aware what the “total package” was, since no copy of the judgment

had been provided to him nor was he informed of its provisions that regarded him.

[486] Gluck was only mandated to prepare the unaudited financial statements for

Chenoy DDO for the years 2018, 2019 and 2020.

[487] Since he was given information “a bit late” for NKDS, nothing was ready for the

trial.

[488] With respect to 136585, Gluck confirmed that no documents or information were

ever given to him.

[489] Be that as it may, for his preparation of the unaudited financial statements that he

worked on, Gluck simply relied on the information provided to him by Baron and Segal

adding that he did not know which companies he was referring to in all of the financial

statements insofar as intercompany or shareholders loans or advances were concerned.

[490] No details were provided to him about any of the loans received from or payable

to shareholders or which affiliated company was involved.

[491] Therefore, he could not include any of the usual explicatory notes to provide

additional details with respect to the financial statements that he prepared hastily between

his testimony of October 25^thand their filing on October 28, 2021¹⁸⁵.

[492] Needless to say, the Court grants no probative value to any of those financial

statements who unfortunately lead the Court to conclude to yet another illustration that

Nicolas and Argyro did not seem to take seriously the present legal proceedings and the

legal process.

[493] Why seek an order from this Court to have financial statements prepared by an

accountant and yet, not even provide him with a copy of the judgment that indicated the

extent of his mandate?

¹⁸⁵CP-29A, CP-29B, CP-29C, CP-30A, CP-30B and CP-30C.

500-11-052150-170

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[494] This is an unacceptable behaviour on the part of Defendants.

[495] Finally, Gluck indicated that Argyro never asked him to prepare the financial

statements for Chenoy DDO and DDO Restaurant for the year ending on January 31,

2021, which should have been completed within 6 months of the company’s year-end

January 31, 2021.

[496] Faced with legal proceedings seeking the liquidation and dissolution of DDO

Restaurant, wasn’t it relevant to produce the latest financial statements that should have

been available in time for the October 2021 trial?

[497] When asked if the DDO Restaurant still made a profit? Argyro responded: “I think

so, it’s very hard”, without producing any contemporary and credible evidence.

[498] An investigation by the Monitor to be appointed of the financial situation of DDO

Restaurant is warranted.

[499] Therefore, exercising its judicial discretion pursuant to section 451 QBCA, the

Court thinks fit to appoint Raymond Chabot Inc. represented by Mr. Jean Gagnon, CPA,

CA, CIRP, SAI¹⁸⁶to act as Monitor of Chenoy Delicatessen & Steak House Inc. with the

mandate to:

- Supervise and monitor the operations of the DDO Restaurant without getting

involved in its management;

- Report to this Court on the financial situation and profitability of Chenoy

Delicatessen & Steak House Inc.;

- Provide its opinion and make its recommendations to this Court with a view to

determine the optimal manner to deal with the restaurant operations in the context

of the liquidation and realization of the DDO Property and of the shares held by

Chenoy Delicatessen & Steak House (1976) Ltd. in Chenoy Delicatessen & Steak

House Inc.

The Outstanding Issues

[500] Given the present outcome on Plaintiff’s Oppression Remedy Application, the

Court shall convene the parties to receive their evidence and arguments in connection

with the outstanding issues raised in the Amended Declaration of intervention and the

Cross-Demand both filed by Defendant in continuance of suit Eleni Makridis Sigounis and

in the Paulian Action filed by Plaintiff Dimitrios (Jimmy) Sigounis (File 500-17-117432-

214) (the “Outstanding Issues”).

¹⁸⁶CP-31.

500-11-052150-170

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Indications of abusive conduct on the part of Defendant Argyro

Sigounis pursuant to article 51 and following of the Code of civil

procedure.

[501] The trial enabled the Court to notice indications of abuse of procedure by

Defendant Argyro in her conduct throughout the present proceedings as more fully

detailed in the present Judgment, the whole pursuant to the provisions of article 51 and

following of the Code of civil procedure.

[502] When the Court resumes the hearings with respect to the Outstanding Issues, it

shall hear the representations of Defendant Argyro as well with respect to a potential

declaration of abusive conduct and abuse of procedure on her part against Plaintiff Jimmy

pursuant to the provisions of article 51 and following of the Code of civil procedure.

[503] The Court shall also receive at the same time, the evidence and shall hear the

arguments and representations of the Parties with respect to the request by DICS Eleni

for a declaration of abusive proceedings against Defendant Argyro pursuant to the

provisions of article 51 and following of the Code of civil procedure.

The fees of the Experts

[504] Since the parties did not file the invoices of their respective experts, the Court shall

consider any representations that the Parties may voice in that regard when the trial

resumes with respect to the Outstanding Issues.

Provisional execution notwithstanding appeal

[505] In view of the prevailing serious family and corporate impasse, inclusive of the

requirement to put an end in a definitive manner to this protracted judicial saga, as well

as the right of Defendant in Continuance of Suit Eleni Makridis Sigounis to complete the

deliberation in relation to exercising the option with respect to the Estate of the late

Nicolas Sigounis in accordance with article 632 of the Civil Code of Québec, the Court

shall order the provisional execution of the present Judgment notwithstanding appeal

therefrom.

FOR THOSE REASONS, THE COURT exercising its jurisdiction as the “court” as

defined in each of the Canada Business Corporations Act (the “CBCA”) and the Business

Corporations Act (Québec) (the “QBCA”):

GENERAL

[506] GRANTS in part the Originating Application to institute legal proceedings for

various forms of relief and for liquidation and dissolution of corporations of Plaintiff

Dimitrios (Jimmy) Sigounis dated February 24, 2017;

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[507] DECLARES that Plaintiff Dimitrios (Jimmy) Sigounis is a Complainant within the

meaning of section 238 and following of the CBCA and section 450 and following of the

QBCA for the purposes of the present proceedings;

[508] DECLARES that Defendants, Argyro Sigounis and the Late Nicolas Sigounis

acted towards Plaintiff Dimitrios (Jimmy) Sigounis in a manner that was oppressive,

unfairly prejudicial to and which unfairly disregarded his interests;

[509] DECLARES that Plaintiff Dimitrios (Jimmy) Sigounis holds 40% of the shares of

136585 Canada Inc. and 33^1/3% of the shares of N.K.D.S. Consultants & Investments

Inc., thus leaving the person holding or entitled to the shares of the Late Nicolas

(Nicholas) Sigounis with 20% of the shares of 136585 Canada Inc. and 66^2/3% of the

shares of N.K.D.S. Consultants & Investments Inc.;

[510] ORDERS 136585 Canada Inc. and N.K.D.S. Consultants & Investments Inc. to

make or cause to be made the necessary inscriptions and/or corrections, if need be, in

their registers and other records to reflect the Court’s findings in the preceding paragraph;

[511] DECLARES that the liquidation and the dissolution of the CBCA Chenoy

Corporations (as defined hereafter) is the most logical and equitable solution and remedy,

under the present circumstances;

[512] ORDERS the liquidation and dissolution of the CBCA Chenoy Corporations under

the supervision of this Court pursuant to the relevant provisions of the CBCA;

[513] CONFIRMS that the CBCA Chenoy Corporations shall continue in existence but

shall, effective immediately, cease to carry on business except the business that is, in the

opinion of the Liquidator, required for the liquidation and dissolution of the CBCA Chenoy

Corporations;

[514] CONFIRMS that the board of directors of each of the CBCA Chenoy Corporations

is dissolved effective immediately;

[515] CONFIRMS and ORDERS that effective immediately, the powers of the directors,

officers and shareholders of each of the CBCA Chenoy Corporations cease and vest in

the Liquidator, except as may hereafter be specifically authorized by this Court or upon

further order of this Court;

APPOINTMENT, DUTIES AND POWERS OF THE LIQUIDATOR

[516] CONFIRMS the appointment of Raymond Chabot Inc. represented by Mr. Jean

Gagnon, CPA, CA, CIRP, SAI, as Court-appointed Liquidator (the “Liquidator”) of the

following corporations that are governed by the CBCA, namely:

- 114753 Canada Inc.;

- 114754 Canada Inc.;

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- 136585 Canada Inc.;

- Chenoy Food Network Inc.;

- N.K.D.S. Consultants & Investments Inc.; and

- Chenoy Delicatessen & Steak House (1976) Ltd.

[Collectively the “CBCA Chenoy Corporations” or the “Liquidating Parties”]

[517] ORDERS that the appointment of the Liquidator shall be without security;

[518] GRANTS to the Liquidator all of the duties, powers and rights to act in its capacity

as Liquidator pursuant to the relevant provisions of the CBCA;

[519] ORDERS that, in addition to the powers set forth in the preceding paragraph, the

Liquidator shall have all powers and authority to:

a) Take into its custody and under its control, all the movable and immovable

properties owned by each of the CBCA Chenoy Corporations (collectively the

“Properties” and each a “Property”);

b) exercise all rights, powers and authorities which the board of directors of

any of the CBCA Chenoy Corporations may exercise under the authority of

those Corporations’ constating documents and by-laws and the laws

governing the CBCA Chenoy Corporations, all as amended from time to

time;

c) sign any agreements, documents or instruments, including, without

limitation, leases, offers to lease and similar documents with respect to the

Properties and contracts to be entered into between any of the CBCA

Chenoy Corporations and any third parties, for and on behalf of such

Liquidating Parties, and to do all acts and things and to sign and execute

all other documents and instruments related to such agreements,

documents or instruments;

d) sign and execute any and all documents, agreements or instruments on

behalf of and in the name of the Liquidating Parties with respect to any and

all matters relating to the Liquidating Parties’ banking including, without

limitation, any and all matters dealing with National Bank of Canada,

Toronto-Dominion Bank, Canadian Imperial Bank of Commerce, Bank of

Montreal, Scotia Bank, Royal Bank of Canada and Caisse Desjardins, if

any (each a “Bank” and collectively, the “Banks”)

e) withdraw or order transfers of funds from the Liquidating Parties’ accounts

with any of the Banks by any means including the making, drawing,

accepting, endorsing or signing of cheques, promissory notes, bills of

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exchange, other orders for the payment of money or other instruments or

the giving of other instructions;

f) withdraw and receive from a Bank any cash or any securities, instruments

or other property of the Liquidating Parties held by a Bank and to sign and

deliver receipts therefor, or to give instructions to a Bank for the delivery or

other transfer of any such cash, securities, instruments or other property to

any person named in those instructions;

g) do any one or more of the following:

(i)

deposit with or negotiate or transfer to a Bank cash or any security,

instrument or other property in the name of any of the Liquidating

Parties, or any security or instrument;

(ii)

(iii)

receive statements, instruments and other items (including paid

cheques) and documents relating to the Liquidating Parties’

accounts with or any service of a Bank; and

use a card or client identification number, together in certain

instances with a security code, to make transactions on accounts;

h) receive from the Banks any software and any security devices, including

security cards, codes, and passwords (collectively the “Security Devices”),

relating to electronic banking services or electronic communications

between any of the Liquidating Parties and the Banks; and

i) be granted access to the Banks’ electronic banking services, software and

modules and to use the Security Devices in order to gain full access to the

Liquidating Parties’ accounts and make transactions on any such accounts;

j) carry on the business of any of the CBCA Chenoy Corporations, only so far as

may be necessary and for such time as is necessary for the beneficial winding-

up of the same, realize the Properties and collect all moneys due as the case

may be;

k) obtain payment and take possession of all sums belonging to or due to any of

the CBCA Chenoy Corporations;

l) open a trust account in the name of each of the CBCA Chenoy Corporations,

within shall be deposited all the receipts, and from which shall be emitted any

and all cheques inherent to the present liquidation and dissolution;

m) receive for its services a reasonable remuneration to be paid out of the funds

held in trust, subject to the following provisions and to revision by this Court, at

the end of its mandate;

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n) retain the services of such attorneys and other professionals or experts

necessary or useful to the accomplishment of its mandate against reasonable

remuneration;

o) make any reasonable expenditures necessary and useful for the conservation

of the Properties of the CBCA Chenoy Corporations;

[520] ORDERS to the Banks or to any other financial institution, upon service of a copy

of the present Judgment to freeze all bank accounts in the name of any of the CBCA

Chenoy Corporations and to remit to the Liquidator or to its authorized representative all

amounts found in any of said bank accounts, as the case may be;

[521] ORDERS that no legal proceedings, enforcement process or extra-judicial

proceedings in any court or other tribunal shall be commenced or continued against the

Liquidator except with the written consent of the Liquidator or with leave of this Court;

[522] ORDERS that the Liquidator shall incur no liability or obligation as a result of its

appointment or fulfillment of its duties in carrying out the provisions of this Judgment and

all the Orders made therein, save and except for any gross negligence or wilful

misconduct on the Liquidator’s part;

[523] DECLARES that the Liquidator shall not be considered as operating or continuing

the businesses or enterprises of the CBCA Chenoy Corporations for any purposes

whatsoever and that the Liquidator shall not be deemed to be a director of the CBCA

Chenoy Corporations;

[524] ORDERS that the Liquidator shall not incur any liability whatsoever regarding third

parties for any act done under this Judgment and all the Orders made therein;

[525] ORDERS that the Liquidator shall not be deemed or considered to be a successor

employer, related employer, sponsor or payer to any of the current or former employers of

the CBCA Chenoy Corporations within the meaning of any provincial, federal or municipal

legislation, civil law or common law governing employment or labour standards (the “Labour

Laws”) or any other statute, regulation or rule of law or equity for any purpose whatsoever,

or any collective agreement or any agreement or any other contract between the CBCA

Chenoy Corporations and any other contract between the CBCA Chenoy Corporations and

any of the CBCA Chenoy Corporations’ current or former employees. In particular, the

Liquidator shall not be liable to any of the current or former employees of the CBCA Chenoy

Corporations for any wages under any applicable Labour Laws, including severance pay,

termination pay, and vacation pay; the Liquidator shall not be liable for any contribution or

any payment to any pension or benefit fund;

[526] ORDERS that the Liquidator shall not, as a result of this Judgment, or anything done

in pursuance of the Liquidator’s duties and powers hereunder, be deemed to be in possession

of the Properties within the meaning of any federal, provincial or other legislation, statute,

regulation or rule of law or equity respecting the protection, conservation, enhancement,

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remediation or rehabilitation of the environment or relating to the disposal of waste or any

other contamination and regulations thereunder;

[527] ORDERS that, in marketing or selling any Property, the Liquidator be acting in place

of the Liquidating Parties and not as a real estate broker;

DUTY TO PROVIDE ACCESS and CO-OPERATION TO THE LIQUIDATOR

[528] ORDERS that, upon the written request of the Liquidator, all the Parties herein

(Argyro and Jimmy Sigounis as well as Eleni Makridis Sigounis (collectively the

“Parties”)) and their respective counsels as well as all the Persons (as defined hereafter)

shall forthwith advise the Liquidator of the existence of any Property in such Person’s

possession or control, shall grant immediate and continued access to the Property to the

Liquidator and shall deliver all such Property to the Liquidator;

[529] ORDERS that, upon the written request of the Liquidator and without the need for

the approval of any shareholder or director of any of the CBCA Chenoy Corporations, the

Parties, their respective counsels and any other person, including any advisor, legal or

otherwise, accountant, bookkeeper, or other professional person or organization, acting

for any of the CBCA Chenoy Corporations and any franchisee operating or having

operated under the Chenoy’s banner, as the case may be, and former franchisees of

Chenoy Food Network Inc., as the case may be (collectively the “Persons” and each

being a “Person”) shall release and shall provide to the Liquidator any books, documents,

securities, contracts, orders, corporate and accounting records, and any other papers,

records and information of any kind related to the business or affairs of the CBCA Chenoy

Corporations, and any computer programs, computer tapes, computer disks, or other data

storage media containing any such information (collectively, the “Records”) in that

Person’s possession or control, including, but without limitation, the following:

A) the original minute books of each of the CBCA Chenoy Corporations;

B) general ledgers and trial balances;

C) financial statements;

D) tax returns and assessments;

E) bank statements;

F) title deeds and other title documents related to the Properties;

G) any and all leases or similar agreements related to the Properties; and

H) municipal and school tax bills and other documents related to the Properties;

[530] For greater certainty, ORDERS that the Parties and their respective counsels, the

CBCA Chenoy Corporations, their directors, officers, employees and agents,

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accountants, auditors and all other Persons having notice of the present Judgment shall

forthwith provide the Liquidator with unrestricted access to all of the Business (as defined

hereafter) and Property of each of the CBCA Chenoy Corporations, including, without

limitation, any premises, books, records, data, including data in electronic form, and all

other documents, regardless of their format, of the CBCA Chenoy Corporations and of

the Parties, as the case may be, insofar as they are in connection with or relate to the

Liquidator’s duties and responsibilities hereunder;

[531] ORDERS that if any Records are stored or otherwise contained on a computer or

other electronic system of information storage, whether by independent service provider

or otherwise, all Persons in possession or control of such Records shall, upon the written

request of the Liquidator, provide the Liquidator with all such assistance in gaining

immediate access to the information in the Records as the Liquidator may in its discretion

require, including providing the Liquidator with instructions on the use of any computer or

other system and providing the Liquidator with any and all access codes, account names

and account numbers that may be required to gain access to the information, and shall

not alter, erase or destroy any Records without the prior written consent of the Liquidator;

[532] ORDERS that the Parties, their respective counsels and all directors, officers and

shareholders of the CBCA Chenoy Corporations as well as all Persons shall fully

cooperate with the Liquidator and its authorized representatives in the execution of the

provisions of the present Judgment and all the Orders made therein, and to this end, shall

not disturb, trouble, or otherwise intervene in the administration of the Liquidator;

LIQUIDATOR’S CHARGE AND PAYMENT OF FEES AND EXPENSES

[533] DECLARES that each Property is hereby charged by and subject to a security and

charge to the extent of the aggregate principal amount of $50,000 in favour of the

Liquidator and the Liquidator’s legal counsel, as the case may be (the “Liquidator’s

Counsel”), as continuing and collateral security for the professional fees, expenses,

charges and disbursements incurred both before and after the making of this Judgment

and directly related to these liquidation proceedings (the “Liquidator’s Charge”), having

the priority established by the following paragraph;

[534] ORDERS and DECLARES that the Liquidator’s Charge shall rank junior to and

after all hypothecs, mortgages, security interests, trusts, liens, charges, encumbrances

and third-party rights, other rights or security (statutory or otherwise) of any nature, source

or kind, existing over and/or on each Property as of the date hereof, without any

requirement of publication, registration, recording, filing or perfection in any jurisdiction

whatsoever;

[535] ORDERS that subject to Section 223 CBCA, all fees and disbursements of the

Liquidator and the Liquidator’s Counsel (inclusive of applicable taxes) and all expenses

(inclusive of applicable taxes) incurred by the Liquidator and the Liquidator’s Counsel in

their performance of their duties hereunder (collectively the “Fees and Expenses”) may

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be paid by the Liquidator out of first available proceeds of liquidation of any Property or

any other available funds (collectively the “Liquidation Proceeds”) prior to the

distribution of any funds to the shareholders of the Liquidating Parties;

[536] ORDERS that, notwithstanding the preceding paragraph, the Fees and Expenses

will, in the Liquidator’s final accounts, be allocated against the Liquidating Parties and/or

one or more Property as shall be determined by the Liquidator in its sole discretion or by

this Court;

THE LIQUIDATOR’S PRELIMINARY REPORT AND SALE PROCEDURE RULES

[537] ORDERS the Liquidator to produce and submit to this Court’s approval, on or

before April 29, 2022, its preliminary written report relative to its findings relating to the

affairs of the CBCA Chenoy Corporations and on their respective administration and

financial situation (the “Preliminary Report”); the Preliminary Report shall include the

Liquidator’s proposed plan for the liquidation and dissolution of each of the CBCA Chenoy

Corporations with its opinion and recommendations on the most appropriate method or

methods to proceed to the liquidation of each of the CBCA Chenoy Corporations to

optimize the realization of their respective Properties;

[538] ORDERS the Liquidator to also submit to this Court’s approval with its Preliminary

Report, its proposed Sale Procedure Rules in respect of each of the Liquidating Parties

(the “Sale Procedure Rules”);

[539] Concurrently to the filing with this Court of its Preliminary Report and proposed

Sale Procedure Rules, ORDERS the Liquidator to communicate, on a strictly confidential

basis, a copy thereof to the respective counsels of the Parties herein;

[540] ORDERS that the Preliminary Report and the proposed Sale Procedure Rules

shall be treated and kept confidential by the Parties and their respective counsels and

kept under seal until further order of this Court;

CHENOY DELICATESSEN & STEAK HOUSE INC.

[541] Exercising its jurisdiction pursuant to Section 451 of the Business Corporations Act

(Québec), ORDERS the appointment of Raymond Chabot Inc. represented by

Mr. Jean Gagnon, CPA, CA, CIRP, SAI to act as Monitor of Chenoy Delicatessen &

Steak House Inc. (the “Monitor”) with the mandate to:

- Supervise and monitor the operations of Chenoy Delicatessen & Steak House Inc.

without getting involved in its management;

- Provide its opinion and make its recommendations to this Court with a view to

determine the optimal manner to deal with Chenoy Delicatessen & Steak House

Inc. and its restaurant operations in the context of the liquidation and realization of

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the DDO Property owned by Chenoy Delicatessen & Steak House (1976) Ltd. and

of the shares issued by Chenoy Delicatessen & Steak House Inc. held by Chenoy

Delicatessen & Steak House (1976) Ltd.; and

- Report to this Court on or before April 29, 2022 on the foregoing which report shall

cover the affairs, management and financial situation and profitability of Chenoy

Delicatessen & Steak House Inc. (the “Chenoy Delicatessen Report”);

[542] ORDERS Defendant Argyro Sigounis to cooperate fully with the Monitor in the

performance of its present mandate and to provide or cause to be provided, at the

Monitor’s request, all documents and information, banking, financial or otherwise, in her

possession or control pertaining to Chenoy Delicatessen & Steak House Inc.;

[543] ORDERS that henceforth until further order of this Court, Defendant Argyro

Sigounis and Chenoy Delicatessen & Steak House Inc. shall deposit or cause to deposit

all sale receipts and other revenues without exception (in cash or otherwise) of Chenoy

Delicatessen & Steak House Inc. in the latter’s bank account(s) the identity and

coordinates of which (including all information and access codes, via Internet or

otherwise, to said bank account(s) for monitoring purposes) shall be disclosed by

Defendant Argyro Sigounis to the Monitor within 72 hours of the present Judgment;

[544] ORDERS that henceforth until further order of this Court, Defendant Argyro

Sigounis shall abstain from concluding, signing or executing any agreement or contract

binding in any way Chenoy Delicatessen & Steak House Inc. outside the normal course

of business without obtaining the prior express written consent of this Court;

[545] ORDERS that henceforth until further order of this Court, Defendant Argyro

Sigounis, whether acting in her personal capacity or in her capacity as officer and director

of Chenoy Delicatessen & Steak House Inc., is forbidden from making any payments,

withdrawals, transactions, transfers or debits in any manner whatsoever including the use

of corporate credit or debit cards, and from issuing or drawing any cheques or other

instruments, for or on behalf of Chenoy Delicatessen & Steak House Inc. and for any

amount unless they are made exclusively in the ordinary course of business of Chenoy

Delicatessen & Steak House Inc. to satisfy its current obligations only;

[546] ORDERS that any payment or transaction made in cash by Chenoy Delicatessen

& Steak House Inc. must also be made exclusively for and in the normal course of

business of Chenoy Delicatessen & Steak House Inc. to satisfy its current obligations only

and that all such cash payments and transactions shall be duly reported in writing with

supporting documents to the Monitor on a biweekly basis or upon request of the Monitor;

[547] ORDERS that the Monitor shall enjoy the same protections mutatis mutandis of

the Liquidator more fully set out in the section entitled Appointment, Duties and Powers

of the Liquidator above;

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[548] ORDERS that all fees and disbursements of the Monitor and all expenses

(inclusive of applicable taxes) incurred by the Monitor in the performance of its duties

hereunder shall be entirely borne and be the responsibility of Chenoy Delicatessen &

Steak House Inc. and shall be paid entirely by the latter within 7 days from the remittance

of the Monitor’s invoice;

[549] Upon receipt of the Chenoy Delicatessen Report, RESERVES the right to

determine the most logical and equitable solution and remedy applicable to Chenoy

Delicatessen & Steak House Inc. pursuant to the provisions of the QBCA after having

considered the Chenoy Delicatessen Report and heard the report of the Monitor and the

representations of the Parties at a hearing to be convened at a later date;

STAY OF PROCEEDINGS AND LIMITATION OF ACTIONS

[550] ORDERS that, until the completion of the present mandate of the Liquidator or

such other date as this Court may order from time to time (the “Stay Period”), no

proceeding or enforcement process in any court or tribunal (each, a “Proceeding”) shall

be commenced or continued against or in respect of any of the CBCA Chenoy

Corporations, or affecting their business operations and activities (the “Business”) or any

of their Property (movable or immovable assets), including as provided in the following

paragraph, except with prior leave of this Court;

[551] ORDERS that any and all Proceedings currently under way against or in respect

of any of the CBCA Chenoy Corporations or affecting their Business or any of their

Property are hereby stayed and suspended pending further order of this Court, the whole

pursuant to Section 241(3) CBCA;

[552] ORDERS that during the Stay Period, all rights, recourses and remedies,

including, but not limited to modifications of existing rights and events deemed to occur

pursuant to any agreement to which any of the CBCA Chenoy Corporations is a party as

a result of their insolvency and/or as a result of the present proceedings and Judgment,

any events of default or non-performance by any of the CBCA Chenoy Corporations or

any admissions or evidence in the present proceedings of any Person against or in

respect of any of the CBCA Chenoy Corporations, or affecting their Business, their

Property or any part thereof are hereby stayed and suspended except with the written

consent of the Liquidator or with the prior leave of this Court;

[553] ORDERS that during the Stay Period, all rights and remedies of any Person

against any of the CBCA Chenoy Corporations or any of their respective Property are

hereby stayed and suspended, except with the written consent of the Liquidator or prior

leave of this Court;

[554] ORDERS that during the Stay Period, no Person shall discontinue, fail to honour,

alter, interfere with, repudiate, terminate or cease to perform any right, renewal right,

contract, agreement, licence or permit, in each case, in favour of or held by any of the

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CBCA Chenoy Corporations, except with the written consent of the Liquidator or prior

leave of this Court;

[555] ORDERS that no insurance policy, insurance coverage, bond or any other type of

financial guarantees provided to or in favor of any of the CBCA Chenoy Corporations

Petitioner shall be terminated or cancelled as a result of the present liquidation and

dissolution process, the issuance of this Judgment and all the Orders made therein or the

appointment of the Liquidator except with the written consent of the Liquidator or prior

leave of this Court;

[556] DECLARES that within thirty (30) days from the date hereof or at a later date if

authorized by this Court, any interested Person may apply to this Court to vary or rescind

the Orders of the present Judgment or seek other relief at a comeback hearing to take

place after a seven (7) days notice was given to the Court, the Parties’ counsels, the

Liquidator and to any other Person likely to be affected by the order sought or upon such

other notice, if any, as this Court may order;

MISCELLANEOUS

[557] ORDERS the Liquidator report to this Court on its administration and mandate, as

prescribed by the applicable laws and/or, in any event, every three (3) months from the

date of the present Judgment or within any other delay that may be determined by this

Court upon request made by the Liquidator or any of the Parties;

[558] AUTHORIZES the Liquidator, if need be, to prepare, complete and file on behalf

of the CBCA Chenoy Corporations with the appropriate fiscal and governmental

authorities all the required tax returns and other forms as may be required in order to

proceed and finalize the formal liquidation and dissolution of each of the CBCA Chenoy

Corporations;

[559] Upon finalization of the liquidation and dissolution of the CBCA Chenoy

Corporations, should there be any net surplus available (the “Net surplus”), ORDERS

the Liquidator to submit to the prior approval of this Court, with notice to the Parties’

respective counsels, its proposal for the distribution of the Net surplus among the

shareholders of the CBCA Chenoy Corporations in accordance with their equity interest

in said corporations;

[560] AUTHORIZES and DECLARES that the Liquidator may, from time to time, apply

to this Court for advice and directions as to any matter pertaining to this Judgment and

any of the Orders made therein and/or pertaining to the CBCA Chenoy Corporations;

[561] To that end, AUTHORIZES the Liquidator to retain the services of a legal counsel

to make representations on its behalf before this Court in its capacity as the Liquidator of

the CBCA Chenoy Corporations and/or as Monitor of Chenoy Delicatessen & Steak

House Inc.;

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[562] ORDERS that the filing and presentation of the Oppression Remedy Application

and the issuance of this Judgment and all the Orders made therein shall not constitute

any event of default, default or breach under or pursuant to any and all agreements,

undertakings or engagements to which any of the CBCA Chenoy Corporations are a

party;

[563] DECLARES that to the extent necessary or applicable, this Judgment and all the

Orders made therein shall have full force and effect in all provinces and territories in

Canada;

[564] REQUESTS, to the extent necessary or applicable, the aid and recognition of any

court or administrative body in any Province of Canada and any Canadian federal court

or administrative body and any federal or state court administrative body in the United

States of America and any court or administrative body elsewhere, to act in aid of and to

be complementary to this Court in carrying out the terms of this Judgment and all the

Orders made therein;

[565] ORDERS that to the extent necessary or applicable, the Liquidator be entitled,

authorized and empowered to apply to any court, tribunal, regulatory body or

administrative body, wherever located, for the recognition of this Judgment and all the

Orders made therein and for assistance in carrying out the terms of this Judgment;

[566] DECLARES that the undersigned SHALL REMAIN SEIZED of the present matter

for any incident or for any question or issue relating to the implementation or the execution

of the present Judgment and all the Orders made therein and/or relating to Chenoy

Delicatessen & Steak House Inc. and/or relating to the liquidation and dissolution of the

CBCA Chenoy Corporations;

[567] DECLARES that there are indications of abuse of procedure by Defendant Argyro

in her conduct throughout the present proceedings, the whole pursuant to the provisions

of article 51 and following of the Code of civil procedure;

[568] DECLARES that when this Court resumes the hearings with respect to the

Outstanding Issues (as defined hereafter), it shall hear the representations of Defendant

Argyro with respect to a potential declaration of abusive conduct and abuse of procedure

on her part against Plaintiff Jimmy pursuant to the provisions of article 51 and following

of the Code of civil procedure;

[569] CONVENES Plaintiff Dimitrios (Jimmy) Sigounis, Defendant Argyro Sigounis and

Defendant in continuance of suit Eleni Makridis Sigounis to a management conference in

order to plan the next steps to be taken in connection with the outstanding issues raised

in the Amended Declaration of intervention and the Cross-Demand both filed by

Defendant in continuance of suit Eleni Makridis Sigounis and in the Paulian Action filed

by Plaintiff Dimitrios (Jimmy) Sigounis (File 500-17-117432-214) (the “Outstanding

Issues”), the whole at a time and date to be determined ulteriorly;

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[570] POSTPONES to the next hearing on the Outstanding Issues the determination of

the Demand made by Defendant in continuance of suit Eleni Makridis Sigounis against

Defendant Argyro Sigounis for payment of damages based on the abuse of process

pursuant to article 51 and following of the Code of civil procedure;

[571] For greater certainty and to the extent that it remains applicable, RENEWS until

final judgment on the Outstanding Issues the Safeguard Orders previously rendered in

the present matter;

[572] DECLARES that the present Judgment and all the Orders made therein shall

become enforceable at the date and time that it is rendered;

[573] ORDERS the provisional execution of the present Judgment notwithstanding any

appeal and without the need to provide any security or provision for costs whatsoever;

[574] THE WHOLE, with costs payable by Defendant Argyro Sigounis.

__________________________________

MICHEL A PINSONNAULT, J.S.C.

M^treLouis G. Brunet

Gagnon Brunet Kilani

Attorneys for Plaintiff Dimitrios (Jimmy) Sigounis

M^treLéo Di Battista

M^treLuigi Sorbo

Zaurrini Avocats

Attorneys for Defendant Argyro Sigounis

M^treRobert Pancer

Phillips Friedman Kotler s.e.n.c.r.l.

Attorneys for the Defendant in Continuance of suit Eleni Makridis Sigounis

Hearing dates:

October 13, 14, 15, 18, 19, 20, 21, 22, 25, 26, 27, 28 and December

9, 2021

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CHENOY CORPORATIONS ORGANIZATIONAL CHART

(Version offered by Jimmy Sigounis and accepted by the Court)

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Exhibit P-31—Argyro June 2016 Offer

ADDENDUM TO THE OFFER:

1. “Charcuterie et Grilladerie Chenoy (1976) ltée” and “Chenoy Delicatessen &

Steak house Inc.” will have to be merged vertically PRIOR TO THE

TRANSACTIONS.

2. Nick Sigounis nominee will buy from the company “Chenoy Delicatessen &

Steak House Inc.” and from “114754 Cda Inc.” for the sum of 1000$ all the shares

of Chenoy Food Network Inc. prior to the transactions.

3. A first Newco to be formed will buy for the amount of (2,100,000$- 9 353$- 390

200$) = 1 700 447 $ the property from DDO 1976 Inc.

4. A 2nd Newco will buy for 9 353$ the shares from Nick Sigounis in DDO 1976.

5. The same 2nd Newco will buy the shares from 136585 Cda Inc. for 390 200$ in

DDO 1976.

6. THE GLOBAL OFFER IS for 2,100,000 $ being THE SUM OF ITEMS 3, 4 and

5.

7. 1976 is getting an offer of 1 700 447$ and allocation of selling price is:

Mortgage repayments: 558 000$ (estimated)

Brokerage fees: 21 000$

Other fees: 5 000$

Loan to directors: 104 948$.

Debts to trade or government: 58 162$.

2nd Loan to director: 31 100$ … total disbursement of 778 210$

Plus: Assumption of debts by the buyer to be paid at a later time: 922 237$…

Total of transaction: 1 700 447$

8. 136585 cda Inc. will be getting: 390 200$.

9. Nick Sigounis will be getting:

From the shares: 9 352$

From advances: 104 948$

From other advances: 31 00$

From 136585 cda Inc.: 20% of 390 200$ = 78 040$.

Total from transaction: 223 440$¹⁸⁷

¹⁸⁷Ibid., pages 10 and 11.