Executive Summary: Key Legal and Evidentiary Issues

• Classification of the building as a “tourist accommodation establishment” based on Airbnb and other online listings, including simulated bookings for stays under 31 days.
• Interpretation of the “donner lieu de croire” standard under article 38 of the former Loi sur les établissements d’hébergement touristiques and how a reasonable person would read the Airbnb listing.
• Effect of mixed or “contradictory” wording in the listing (monthly rentals, long/short term, per-night pricing) on whether the prosecution proved the essential elements of the offence beyond a reasonable doubt.
• Scope of the due diligence defence in a regulated field, including use of a property-management system (Cloudbeds) to block short stays and written clarifications to would-be tenants.
• Relevance of municipal zoning/classification errors and the trustee’s efforts to correct them in assessing diligence.
• Appellate scrutiny of the trial judge’s reasoning: identification of an error of law on the elements of the offence, but deference to factual findings on the success of the due diligence defence, leading to confirmation of the acquittal.

Facts of the case
La Fiducie El-Housseini owns and operates a multi-unit building at 2284 rue Ontario Est in Montréal (the Establishment), doing business as “Cjours Appartements”. The property is used for rental accommodation and contains several furnished units intended for tenants. Raja Husseini is a trustee of the Fiducie and acts as its representative in dealing with regulatory authorities. In 2021, Husseini applied for an attestation de classification under the then-applicable Loi sur les établissements d’hébergement touristiques so the Establishment could be legally operated as a tourist accommodation establishment. The Corporation de l’industrie touristique du Québec (CITQ) issued a formal pre-notice on 22 September 2021 refusing the classification because the planned use of the building was not compliant with the urban planning by-laws governing land use in the relevant borough. The refusal was confirmed on 12 October 2021, and Husseini was ordered to cease any operation of the building as a tourist accommodation establishment and warned about the penal offence set out in article 38 of the statute. Despite the refusal, an inspector with the Agence du revenu du Québec (ARQ) later opened a compliance investigation in 2022 after information was received about the rentals at the Establishment. On 3 August 2022, the inspector viewed an Airbnb listing for a unit at the address and prepared an offence report and a supplementary report. She noted that the unit was offered against payment, with pricing structured “per night”, that a reservation could be simulated for a minimum of seven nights, and that the listing host name was “Raja”, with the listing titled “Cjour Appartement Montréal”. The Airbnb description stated that the building offered “en location mensuelle, de superbes appartements ensoleillés” and referred to “Location à long / court terme à un coût très compétitif”. The inspector also recorded that the building was advertised on TripAdvisor, and she took photographs of the premises corresponding to the online listings. On 8 August 2023, following this investigation, ARQ issued a penal ticket to Husseini personally. The ticket alleged that, on or about 3 August 2022, in Montréal she “exploited or gave cause to believe that she was operating” a tourist accommodation establishment even though an attestation of classification had been refused, contrary to article 38 of the former Loi sur les établissements d’hébergement touristiques. The minimum statutory fine for such an offence, if proved against a natural person, was $5,000.

The trial decision before the Court of Québec
Husseini pleaded not guilty and contested the penal ticket in the Court of Québec, Criminal and Penal Division. The trial took place on 17 June 2024. The prosecution relied primarily on documentary evidence (including the inspector’s offence report, the supplementary report and screenshots of the online listings) to show that the Establishment constituted a tourist accommodation establishment and that the public was led to believe that units were available for stays not exceeding 31 days. Husseini testified in her own defence. She explained that she understood the obligations associated with tourist accommodation and that, pending a proper classification, she intended only to permit “monthly” rentals. She testified that she had successfully configured other platforms (Booking.com and TripAdvisor) so that only stays of at least 31 days could be reserved. For Airbnb, however, she said she had difficulty configuring the minimum stay directly. To address this, she integrated a property-management system called Cloudbeds into the Airbnb account. According to her evidence, Cloudbeds controlled the back-end calendar and reservation parameters: while Airbnb might show illustrative availability or allow simulations of shorter stays, it would be impossible for a user to complete a booking that did not meet the programmed minimum duration (31 days or more). She further stated that she added clarifying comments in the “en savoir plus” section of the Airbnb listing stating that the Establishment offered monthly rentals only, and that only such stays would be accepted. The Court of Québec judge accepted that, on the face of the Airbnb interface, a user could simulate a seven-night stay in October 2022 at a fixed price. Standing alone, this could support a conclusion that the listing “gave cause to believe” that accommodation was being offered for less than 31 days. However, the judge placed significant weight on the wording in the “en savoir plus” section emphasizing “location mensuelle” and referring to long- and short-term rentals, and found that these comments introduced sufficient ambiguity from the standpoint of a reasonable viewer. In the judge’s view, a reasonable person confronted with the mixed signals of a monthly-rental description and a seven-night simulation would be left with a genuine doubt as to whether stays of under 31 days were truly on offer. The judge therefore held that ARQ had not proven, beyond a reasonable doubt, the essential element of the offence that Husseini “gave cause to believe” she was operating a tourist accommodation establishment within the meaning of the statute and its regulation. In addition, the judge accepted Husseini’s due diligence defence. The judge found that she had taken meaningful steps to comply with the law: integrating Cloudbeds to block improper short reservations, attempting to configure her listings in line with the 31-day rule, including clarifying wording about monthly rentals, and engaging with the municipal borough to correct what she considered to be an erroneous land-use classification that had led to the original refusal by CITQ. On this basis, the Court of Québec acquitted her of the charge on 25 September 2024; the judgment was rectified on 11 October 2024.

The applicable legal framework and issues on appeal
The alleged offence occurred in August 2022, when the former Loi sur les établissements d’hébergement touristiques was still in force. That law applied to establishments that offered accommodation for remuneration to “tourists” and required an attestation of classification for any tourist accommodation establishment. Article 38 created a strict-liability offence where a person either actually operated such an establishment without a valid attestation (or after refusal, suspension, or cancellation), or “donne lieu de croire” that they were operating such an establishment in those circumstances. The concept of a “tourist accommodation establishment” was further defined in the accompanying regulation as an establishment in which at least one unit is offered for rent, for remuneration, to tourists, for a period not exceeding 31 days, and where the availability of that unit is made public through any media. On appeal, ARQ, as the prosecuting appellant, did not challenge the finding that Husseini, as trustee for the Fiducie, was a proper person to be charged; that part of the trial judgment was accepted. Instead, ARQ raised two pure questions of law under the Code de procédure pénale: first, whether the trial judge erred in law by holding that the prosecution had not discharged its burden of proving the “gives cause to believe” element of the offence beyond a reasonable doubt; and second, whether the judge erred in law by concluding that Husseini had proven her due diligence defence on a balance of probabilities. The Superior Court, sitting in criminal matters, applied a narrow intervention standard in line with article 286 C.p.p.: an acquittal may be disturbed only where the judgment is unreasonable having regard to the evidence, where there is an error of law that, but for the error, would have changed the result, or where justice has not been done. Errors of pure law are reviewed for correctness, while factual and mixed questions are subject to the “palpable and overriding error” standard.

Analysis of the “gives cause to believe” element
The Superior Court first revisited the statutory elements associated with “donner lieu de croire”. Drawing on its own recent case law, it affirmed that the offence is one of strict liability. The prosecution does not need to show a subjective intent to mislead the public or to breach the statute. For the “gives cause to believe” branch, the essential elements are: (i) that the establishment meets the regulatory definition of a tourist accommodation establishment (that is, at least one unit is publicly offered for rent to tourists, for remuneration, for a period not exceeding 31 days, via some form of media), (ii) that the accused person “gives cause to believe” they are operating such an establishment, and (iii) that no attestation of classification has been properly issued even though it is required. The Court accepted that “exploiter” means making use of the property for a lucratively oriented purpose, and “donner lieu de croire” refers not to actual operation but to acting or allowing circumstances that lead a reasonable person to believe the establishment is available as defined. Crucially, the test is objective: what conclusions would a reasonably informed person of ordinary intelligence draw upon seeing the listing, without legal research or specialized knowledge. The Court agreed with the trial judge that the availability of a pricing structure by the night and a completed simulation of a seven-night booking at a fixed price is normally sufficient to establish that the public is given cause to believe that short-term tourist accommodation is on offer. The Superior Court also accepted that a judge may examine all aspects of the listing, including narrative descriptions and additional comments, in applying the reasonable-person test; nothing in the case law compels the court to focus only on the calendar and pricing interface. However, the Superior Court identified a key legal error in the trial judge’s treatment of the wording “location mensuelle” and “location à long / court terme”. In the Superior Court’s view, these terms are not “discordant” with the seven-night simulation in any way that favours the accused. The phrase “location mensuelle” implies a rental for one month, and in ordinary language in French a month runs from 28 to 31 days; no month is longer than 31 days. When combined with a reference to “court terme”, any reasonable reader would understand that the landlord is willing to rent apartments for periods that may be as short as a month, which necessarily fall within the 1-to-31-day range that triggers the regulation. The trial judge, having correctly set out the definition in the regulation as a period “n’excédant pas 31 jours”, then drifted into describing the prohibited period as “less than 31 days”, effectively excluding the 31st day from the calculus. This misstatement of the time threshold shaved one day off the statutory coverage and fed the judge’s view that there was an inconsistency between a seven-night booking and a “monthly” offer. The Superior Court held that, properly framed, there was no true contradiction: whether the Establishment was being presented for seven-night stays or one-month stays, both options fell squarely within the prohibited “not exceeding 31 days” range. Accordingly, the Court concluded that ARQ had, as a matter of law, proved beyond a reasonable doubt that the listing “gave cause to believe” that the Establishment was being operated as a tourist accommodation establishment without the required attestation. It held that the trial judge’s contrary conclusion rested on an error of law in the interpretation and application of the 31-day threshold, and that, without this error, the result on the elements of the offence would necessarily have been different.

Assessment of the due diligence defence
The Superior Court then turned to the second ground of appeal: whether the trial judge erred in law in finding that Husseini had provided sufficient proof of due diligence. Drawing on Supreme Court of Canada and Québec Court of Appeal authority, the Court reiterated that due diligence is established on a balance of probabilities and requires the defendant to show they took all reasonable steps to avoid the occurrence of the prohibited event. The standard is objective and is applied contextually, taking into account that participants in regulated sectors—such as tourist accommodation—may be held to a more demanding level of vigilance. There is, however, no closed checklist of measures that automatically establish or negate due diligence; courts must evaluate all preventive actions taken and compare them to what a reasonable person in the same circumstances would have done. The Superior Court characterised this analysis as essentially factual, or at most mixed fact and law, attracting deference unless there is a palpable and overriding error. The trial judge had identified three main components of Husseini’s conduct: first, she deployed Cloudbeds as an integrated management system for her Airbnb account so that bookings that did not meet the minimum-stay parameters (31 days or more) could not be completed, even if a shorter simulation appeared possible on the front end; second, she added written clarification in the “en savoir plus” section explaining that the units were intended for monthly rentals, signaling that nightly or very short stays were not intended to be permitted; and third, she actively engaged with the City of Montréal and CITQ to push for a correction of what she considered an erroneous municipal land-use classification that had caused the original refusal of the attestation. The Superior Court acknowledged that some of these measures were imperfect from a compliance standpoint. The wording about “location mensuelle” and “court terme” did not eliminate the possibility that a one-month stay could still fall under the 31-day cap in the regulation, and the listing remained visible on tourist platforms even after the CITQ’s refusal. It also noted that simply blocking a calendar, in isolation, might not suffice to prove due diligence. Nonetheless, the Court stressed that the trial judge had evaluated these elements holistically rather than piecemeal. From that global perspective, the judge had found as a fact that Husseini was not passive or indifferent; she had taken concrete technological and communicative steps to limit short stays and had made efforts to work with public authorities to regularise the property’s status. The Superior Court held that, although another judge might conceivably have reached a different conclusion, the record did not reveal any manifest and overriding error in the way the trial judge assessed this evidence. As appellate review does not permit a simple re-weighing of the evidence, the Court considered itself bound by the trial judge’s finding that the due diligence defence had been made out on a balance of probabilities.

Outcome and significance
In the end result, the Superior Court partly agreed and partly disagreed with the reasoning of the trial judge. It held that the Court of Québec had erred in law when it found that the prosecution had failed to prove the essential “gives cause to believe” element of the offence under article 38 of the former Loi sur les établissements d’hébergement touristiques. Correctly applied, the objective reasonable-person standard, read in light of the statutory 31-day threshold and the wording of the Airbnb listing, compelled the conclusion that the elements of the offence were satisfied. However, the Superior Court upheld the trial judge’s separate conclusion that Husseini had established a due diligence defence as a matter of fact. Because that defence operates as a complete answer to a strict-liability offence once the elements are made out, the acquittal could not be disturbed. Accordingly, the Superior Court dismissed ARQ’s appeal and maintained the acquittal. The successful party in the appeal is therefore Raja Husseini, and there is no indication in the judgment of any monetary award, damages, or quantified costs ordered in her favour; beyond the fact that no fine was imposed due to the maintained acquittal, the total monetary amount ordered cannot be determined from the decision.