Executive Summary: Key Legal and Evidentiary Issues

• Dispute over Québec courts’ international jurisdiction in a copyright infringement and software competition case involving Québec and Ontario parties
• Effectiveness and proof of acceptance of an online forum selection clause in a software services contract binding Sault Northern Landscaping Corp. to Québec courts
• Determination of where the alleged economic prejudice was actually suffered for the purposes of article 3148(3) CCQ, given that the alleged wrongful acts occurred in Ontario
• Insufficiency of general allegations tying loss of clientele and commercial damage to Québec when the key client base and alleged solicitation are located in Ontario
• Limits on extending contractual jurisdiction clauses to non-contracting parties, including corporate officers and related companies
• Application of the forum non conveniens doctrine in the presence of a valid forum selection clause designating Québec as the exclusive forum for disputes with Sault Northern Landscaping Corp.

Factual background

The plaintiff, 9263-7040 Québec inc., is a Québec-based company specializing in the design and commercialization of FolloSoft, a management software tailored to the snow-removal industry. It maintains more than 500 clients in Québec, Ontario, the United States and Europe. The software is deployed through a contract of services model, under which clients use FolloSoft in their operations. Among its clients is Sault Northern Landscaping Corp. (Northern), an Ontario corporation operating in snow removal and landscaping and represented by one of its administrators, Stefano Narducci, in contractual dealings. Northern entered into a services contract with the plaintiff to use FolloSoft. Separately, another Ontario corporation, 1000865576 Ontario Inc., also known as Aurora, developed and marketed a competing software product. Aurora’s administrators are Matthew Ferlaino, Stefano Narducci and Santiago Santoro, all domiciled in Ontario.

Allegations of unlawful software copying and misuse of confidential information

In its originating application for interlocutory and permanent injunctions and damages, the plaintiff alleges that the defendants illegally reproduced several elements of its FolloSoft software without authorization. According to the plaintiff, Aurora’s competing software is in substance a copy of material elements of FolloSoft, amounting to a violation of its intellectual property and copyright. The plaintiff further claims that Northern used its contractual relationship as a client to access privileged and confidential information about the FolloSoft platform. That contractual access allegedly allowed Northern to provide information that aided in the unlawful reproduction and development of the competing software. The plaintiff pleads that this conduct caused commercial losses, including diversion of clientele and loss of business opportunities.

Contractual framework and the forum selection clause

The case turns in part on the services contract and the updated terms and conditions governing Northern’s use of FolloSoft. In 2020, a services contract was concluded between Northern, through Mr. Narducci, and the plaintiff for access to FolloSoft. The plaintiff later updated the online terms and conditions of this services contract in February 2025, adding a clause by which the parties agreed to submit disputes arising from the contract to the courts of Québec. The plaintiff maintains that a representative of Northern, identified as Mitchell Nicolle, accepted the revised terms electronically. The system allegedly recorded data confirming acceptance of the updated terms containing the forum selection clause in favour of Québec courts. This clause, according to the plaintiff, gives the Québec Superior Court jurisdiction over the contractual dispute with Northern. Northern and the individual defendants deny that Northern ever accepted the updated terms and, by extension, the jurisdiction clause. Through a sworn declaration, Mr. Narducci contests that Northern agreed to any new terms and conditions. This factual disagreement over acceptance of the online terms, and the technical records evidencing that acceptance, lies at the heart of the evidentiary discussion on jurisdiction with respect to Northern.

Defendants’ jurisdictional challenge before the Québec Superior Court

All defendants brought an exception déclinatoire, asking the Québec Superior Court to decline jurisdiction. They argued that the court lacked competence under article 3148 of the Civil Code of Québec (CCQ) or, alternatively, that it should decline jurisdiction on the basis of forum non conveniens pursuant to article 3135 CCQ. The jurisdictional debate focused on two prongs of article 3148 CCQ. First, under paragraph 3, Québec courts have jurisdiction where a fault was committed in Québec, a prejudice was suffered in Québec, a harmful act occurred in Québec or one of the contractual obligations was to be performed in Québec. The plaintiff conceded that the alleged wrongful acts themselves took place in Ontario. Its theory was instead that the economic prejudice stemming from copyright violations was suffered in Québec, where it maintains its head office and business operations. Second, under paragraph 4, Québec courts may be competent if the parties, by agreement, have submitted their disputes arising out of a particular legal relationship to Québec tribunals. On this basis, the plaintiff invoked the forum selection clause it says was contained in the updated online terms of the FolloSoft services contract with Northern, arguing that this conferred jurisdiction over Northern specifically.

Legal principles on international jurisdiction and evidentiary burden

The court applied well-established principles governing international jurisdiction under article 3148 CCQ when an exception déclinatoire is raised. When a defendant challenges jurisdiction on this basis, the burden shifts to the plaintiff to demonstrate that Québec courts have jurisdiction. For the purpose of this preliminary jurisdictional debate, the factual allegations in the originating application are presumed true unless they are specifically contested by the defendant, in which case the plaintiff must adduce evidence sufficient to establish the necessary jurisdictional facts on a prima facie basis. The judge’s role on such a motion is confined to determining whether, based on the evidence filed, there is a prima facie foundation for jurisdiction; the judge does not conduct a full merits analysis or resolve the substantive dispute. Furthermore, because the plaintiff is suing multiple defendants, jurisdiction must be analyzed in relation to each defendant individually; it cannot be assumed that a basis for jurisdiction over one defendant automatically extends to all others.

Determining jurisdiction over Northern based on the forum selection clause

In relation to Northern, the court examined whether the plaintiff had shown, on a prima facie basis, that the forum selection clause was validly incorporated into the contract and accepted by Northern. The defendants relied on Mr. Narducci’s sworn declaration to assert that Northern never accepted the updated terms. In response, the plaintiff produced an affidavit from its representative, Patrick Laberge, together with technical records showing that Northern’s representative, Mr. Nicolle, had accepted the new terms and conditions through the system interface, generating data confirming that acceptance. Based on this evidence, the court held that the plaintiff had met its burden at this preliminary stage. It found that someone at Northern had indeed accepted the updated terms containing the forum selection clause designating Québec courts. On that basis, the court concluded that the requirements of article 3148(4) CCQ were prima facie satisfied, thereby conferring jurisdiction on the Québec Superior Court over the dispute with Northern arising from the services contract. Importantly, the court emphasized that the contract was concluded with Northern alone. As a result, the jurisdiction conferred by the forum clause did not extend to Northern’s administrator and co-owner, Mr. Narducci, nor to the other defendants who were not parties to the contract.

Assessment of alleged prejudice in Québec under article 3148(3) CCQ

For the remaining defendants—Aurora, Mr. Ferlaino, Mr. Narducci in his personal capacity and Mr. Santoro—the plaintiff relied on article 3148(3) CCQ, arguing that the economic damage from the alleged copyright infringements was suffered in Québec. The plaintiff underscored that its headquarters, operating staff and patrimony are located in Québec, such that any commercial losses from misappropriation of its software would be felt in Québec where those results are accounted for. The court rejected this reasoning. It reiterated that the place where prejudice is suffered is a question of fact, and the plaintiff must show, on a prima facie basis, that the prejudice was actually suffered in Québec; general or vague allegations are not enough. Jurisprudence cited by the court clarifies that the relevant situs of prejudice under article 3148(3) CCQ is the real location of the injury, not the place where the plaintiff’s patrimony is recorded or where its financial statements reflect the consequences. In addition, where the plaintiff operates in multiple jurisdictions, including where the defendants are based, a more specific factual analysis is required to connect the alleged loss of clientele or revenue to Québec.

Vagueness of the Québec prejudice allegations and focus on Ontario

The court observed that the plaintiff operates in several regions and has a significant client base in Ontario. The allegations in the originating application concerning loss of clientele focused specifically on Ontario customers and solicitation of Ontario clients, with paragraph references to those allegations being directed outside Québec. The plaintiff also admitted at the hearing that it had not actually alleged solicitation or loss of clientele in Québec and that the concrete loss of clients referenced in its pleadings pertained to Ontario. When read as a whole, the pleadings pointed to prejudice suffered in Ontario, where the defendants carry on business and where the client relationships at issue are situated. In light of this, the court concluded that the plaintiff had not adduced adequate evidence to support its assertion that the consequences of the alleged copyright violations were suffered in Québec within the meaning of article 3148(3) CCQ. Because this threshold was not met, the court found that the conditions for establishing jurisdiction over Aurora and the individual defendants based on prejudice in Québec were absent.

The forum non conveniens argument and its exceptional nature

Having determined that Québec courts had jurisdiction only over Northern by virtue of the forum selection clause, the court turned to the defendants’ alternative argument based on forum non conveniens under article 3135 CCQ. The doctrine permits a Québec court to decline jurisdiction, even where it is technically competent, if another forum is clearly more appropriate and it would be plainly preferable for the dispute to be heard there. The court reiterated that several non-exhaustive factors may be considered: residence of parties and witnesses, location of evidence, place of contract formation and performance, existence and stage of related foreign proceedings, location of the defendant’s assets, governing law, advantages for the plaintiff in the chosen forum, the interests of justice, the interests of the parties and the need for eventual recognition and enforcement of the judgment abroad. However, none of these factors is decisive alone, and the court must assess them globally. Crucially, the remedy is reserved for exceptional situations: only if there emerges a clear impression that a single foreign forum is plainly the most suitable, and that it is clearly preferable for the case to be decided there, should the court decline its own jurisdiction.

Balancing of forum non conveniens factors

Applying these criteria, the court acknowledged that Northern is domiciled and conducts its business in Ontario, that its assets are there and that the contract was concluded in Ontario. Many potential witnesses are also in Ontario, though others are in Québec. The court noted, however, that Québec law would govern the contractual allegations. On this full picture, the court did not see a clear, overwhelming tilt toward Ontario as the sole appropriate forum. The defendants also argued that allowing the case against Northern to proceed in Québec while requiring a separate proceeding in Ontario against Aurora and the individual defendants would lead to duplication of evidence and the risk of inconsistent findings on the alleged unlawful copying. The court recognized that some overlap in evidence and witnesses might occur, but emphasized that the claims against Northern are grounded in contract and the alleged misuse of confidential information, whereas Northern is not alleged to be involved in commercializing the competing software or actively soliciting clients. The connections between Northern’s contractual role and the broader alleged infringement scheme were therefore not so tight as to make parallel proceedings unmanageable or exceptional.

Weight of the forum selection clause in the forum non conveniens analysis

The court placed particular importance on the presence of the forum selection clause designating Québec courts as the exclusive forum for disputes arising from the services contract with Northern. By recognizing such clauses in article 3148(4) CCQ, Québec law gives effect to party autonomy and fosters certainty and predictability in international commercial relationships. Resorting to forum non conveniens in the face of a valid clause selecting Québec raises serious concerns: to override the parties’ clear choice of forum would undermine those objectives and the core values of order and fairness in private international law. The Court of Appeal has signaled that invoking forum non conveniens where a Québec forum selection clause exists is possible only in circumstances that are even more exceptional than usual. In this case, the court found no such exceptional circumstances that would justify disregarding the forum clause. The usual concerns about some overlapping evidence and potential for differing findings did not meet this elevated threshold.

Outcome and identification of the successful parties and monetary consequences

In the result, the court partially granted the defendants’ exception déclinatoire. It declined jurisdiction over the claims against 1000865576 Ontario Inc. (Aurora), Matthew Ferlaino, Stefano Narducci and Santiago Santoro and dismissed the plaintiff’s originating application for injunction and damages as against those four defendants, with costs. The exception déclinatoire was rejected as against Sault Northern Landscaping Corp., over which the Québec Superior Court retained jurisdiction on the strength of the validly accepted forum selection clause in the FolloSoft services contract. Accordingly, the four Ontario defendants (Aurora and the three individual administrators) were successful on the jurisdictional motion, while Northern was not. The judgment, however, is confined to questions of jurisdiction and does not adjudicate the substantive copyright and damages claims, nor does it quantify any monetary award. The only financial order is an award of costs in favour of the successful moving defendants, expressed “with costs”, without any specified amount. As a result, although costs are formally granted in their favour, the total monetary value of the costs or any damages in favour of any party cannot be determined from this decision.