The Quebec Court of Appeal shuts the door on using an interlocutory injunction as a crutch for a seller’s action to compel a sale — and gives us a good reason to explain what a seller or a buyer can really do when a signed promise to purchase falls apart.
In August 2023, a French aircraft-painting company signs an agreement to buy, for $15,000,000, the assets of a Canadian division specializing in the finishing of business jets. The contract lays out a step-by-step path: due diligence, third-party consents, deposit of the price in trust, then closing. But the buyer, citing environmental concerns, refuses to move on to the next steps. The seller wants the deal to close, period. It sues to force the transaction and asks the court — before any trial — to order the buyer to deposit the purchase price, $15,000,000 plus taxes, in trust. The trial judge agrees and orders $14,652,838 plus taxes (the price, less the deposit already paid) to be held by a law firm. In Satys Aerospace c. IMP Group Limited, 2026 QCCA 1140, decided on August 26, 2026 and written by Justice Benoît Moore, the Court of Appeal reverses that decision.
The case is commercial and the numbers are big, but the question it settles matters to anyone who has ever signed an accepted offer to purchase — for a house, a condo, a lot or a business — and watched the other side change its mind along the way.
The facts: a staged transaction that goes off the rails
The asset purchase agreement set out a precise mechanism. The buyer had 21 days for due diligence, which could include a Phase I environmental assessment. Once Bombardier (the division’s main client) and Aéroports de Montréal (the landlord) consented to the assignment of their contracts, and the permits were transferred, the buyer had two business days to deposit the purchase price in trust, with closing to follow no later than ten days after those consents.
In November 2023, the buyer announces that it cannot confirm its due diligence is complete: the Phase I report recommended a more intrusive Phase II study, and the buyer makes it a non-negotiable condition. The seller replies that the contract provides for no Phase II study, that the environmental risk tied to painting activities was known to both parties, and that the buyer is really trying to renegotiate the price. Positions harden. In February 2024, the seller files suit.
On the merits, it seeks what Quebec law calls passation de titre — a judgment that forces the sale and stands in for the deed — plus damages. But it also asks, right away, for an interlocutory injunction (a provisional order issued before trial) compelling the buyer to deposit the purchase price until final judgment. The buyer, for its part, asks that the contract be declared null and its deposit refunded.
What exactly is an action to compel a sale?
When you sign an accepted offer to purchase, you do not become the owner: you commit to completing the sale later, at the notary’s office. If one party then refuses to sign the deed of sale, the other has, in principle, two options. The first is to claim damages for the loss suffered. The second is to force the sale itself. That is the action in passation de titre, provided for in article 1712 of the Civil Code of Québec: a party’s failure to pass title gives the other the right to obtain a judgment that takes the place of the deed. In other words, the judgment replaces the signature of the party who refuses to cooperate and itself operates as the deed of sale — a remedy broader than what common-law jurisdictions usually allow through specific performance.
In the vast majority of cases, it is the disappointed buyer who brings this action: they want that particular house or lot, not a cheque. To succeed, the buyer must show a genuine intention to buy and the means to do so. Historically, the courts were highly formalistic: the buyer had to attach to the lawsuit a draft deed of sale conforming to the promise and deposit the price (or a bank guarantee) the moment the suit was filed. That formalism has been gradually relaxed, notably in Houlachi c. Bray (1997) and Zanetti c. 2946-6117 Québec inc. (2012). Today, as Justice Moore recalls, the buyer need not deposit the price when filing suit; the deposit can be made at the hearing, or even after judgment, on the court’s order. The reason is plain common sense: most buyers finance their purchase with a mortgage, and requiring them to tie up the price years in advance would make the remedy illusory.
Justice Moore summarizes the law in four points, which can be put simply. First, a promise of sale is a contract like any other and can be specifically enforced, in the cases that allow it. Second, once all the preliminary conditions are fulfilled, the remedy takes the form of the action to compel the sale. Third, the buyer must demonstrate the ability to buy, but that requirement is assessed flexibly. Fourth — and this matters for staged transactions — if conditions remain to be fulfilled before the sale (an inspection, delivery of documents, a zoning change, a third party’s consent), the buyer is not limited to damages: the buyer can ask the court to order the performance of those preliminary steps, and the final judgment can set out the full sequence leading to the transfer of ownership.
When the seller is the one who wants to force the sale
Here lies the unusual feature of the case: the seller is the one suing. Article 1712 allows it, but the Court of Appeal had already explained, in De Chanteloup c. St-Laurent, 2021 QCCA 90, why this is extremely rare in practice. The problem is mechanical. For a judgment to stand in for the deed, it must be capable of registration (or execution) without anyone having to chase the payment. When the buyer sues, the buyer brings the money. When the seller sues, it has no control over the other side’s funds. As the Court put it in 2021, the buyer’s refusal to pay leaves the seller, except in rare cases, with damages after reselling the property as the only useful remedy. The situations where it works are exceptional — for instance, when the price is already sitting in trust with the notary at the moment the difficulty arises.
Enter the ingenious argument put forward by the seller and accepted by the trial judge. Since the seller’s action can only succeed if the price is available at the time of judgment, why not use an interlocutory injunction to force the buyer to deposit the price while the case is pending? That would artificially create the “price already in trust” situation described in De Chanteloup, and the judgment on the merits could then unconditionally stand as title. The trial judge, in a decision the Court of Appeal itself describes as meticulously written and thoroughly reasoned, embraced this step-by-step logic in the name of the “flexibility and creativity” the Court of Appeal has encouraged in matters of specific performance.
Why the Court of Appeal says no
Justice Moore does not deny that the reasoning is attractive — he even writes that it is not wrong. But he sees a paradox in it, along with several substantive problems.
The paradox first. The whole relaxation of the law since Houlachi was aimed precisely at not forcing the buyer to tie up the purchase price during a lawsuit. Ordering the buyer to deposit the price at the interlocutory stage imposes exactly that result — this time to protect the seller’s remedy. A curious reversal.
Next, the very nature of an interlocutory injunction. This provisional order exists to preserve the status quo or to prevent a right from being lost before trial — for example, by prohibiting the seller from selling to someone else in the meantime. Here, a forced deposit preserves nothing: it shifts the balance between the parties in the seller’s favour. And the harm invoked — losing the right to specific performance — simply does not exist, because the seller retains other avenues: at the end of the trial, it can obtain orders compelling the buyer to complete the various steps and then pass title. That may be less advantageous, the judge concedes, but it is not illusory. In reality, the Court concludes, the forced deposit mainly protects the seller against the risk of the buyer’s insolvency — a harm that was never pleaded — and looks more like a seizure before judgment than a measure to preserve a right.
Third, the method. Proceeding by successive interlocutory injunctions, on partial evidence, only to redo everything at trial on a full record, risks running counter to the sound use of judicial resources. The Court is careful not to close the door entirely: such an approach could be justified “in certain cases”, but only because of the particular features of the file and always in strict application of the principles governing interlocutory injunctions. It is not a rule; it is an exception that must be earned.
Finally, the contractual clause. The seller argued that the contract itself obliged the buyer to deposit the price, relying on a Superior Court decision (Boriamos, 2024) where such a deposit had been ordered. The Court distinguishes it: in Boriamos, the clause clearly provided for the deposit in the event of a dispute — a protective mechanism negotiated for that precise scenario. Here, the deposit clause was merely a preparatory step toward closing, expected to occur two days after the Bombardier and Aéroports de Montréal consents and eight days before the sale. It was never meant to allocate the risk of litigation. The judge also points out an inconsistency in the sequence: if the real harm was the failure of the transaction, the seller should first have sought an injunction to obtain the third-party consents, a step that came before payment — consents made all the more uncertain by the fact that the Bombardier contract had ended in December 2024 and was being renegotiated.
Why this case stands out
First, because it clears up a grey area. De Chanteloup had opened a small window for sellers by mentioning the case of a price already held in trust; inventive litigators tried to turn that window into a door by manufacturing the trust through an injunction. The Court of Appeal refuses: the mere fact that the seller is the one suing does not justify a deposit injunction when there is no real harm to prevent. The availability of the price must flow from the circumstances, not from a provisional order obtained on an incomplete record.
Second, because Justice Moore sets the record straight on a point that is often forgotten: specific performance, even though it holds a central place in Quebec civil law, is only available “in the cases that allow it” (article 1601 of the Civil Code). A seller having to fall back on damages is not an anomaly; it is often, as the Court already said in 2021, the more suitable remedy, because the identity of the buyer ultimately matters little to the seller — what matters is the price.
Let’s be honest: the trial judge’s position was not far-fetched, and the Court of Appeal acknowledges it. One can argue that a buyer who itself blocks the steps of a contract is poorly placed to complain about having to tie up the price longer than planned — an argument the Court admits “may not be without foundation”, without adopting it. And the Court expressly leaves open the question, decided in Boriamos, of the force of a contractual clause that explicitly provides for a deposit in case of litigation. The debate is therefore not entirely closed; it has been refocused.
Key takeaways: practical advice
If you are a seller and your buyer walks away. Do not assume you will be able to force them to buy. In the vast majority of cases, your realistic remedy is to put the property back on the market, then sue for damages: the difference in price, the additional costs, and the other losses caused by the default. Act quickly: send a clear formal notice, document everything, and relist without delay to limit your losses — a seller who lets things drag will be criticized for failing to mitigate. A seller’s action to compel the sale remains possible, but exceptional: it requires clear title, a draft deed conforming to the promise and, above all, a price that will actually be available when judgment is rendered.
If you are a buyer and your seller refuses to sign. Your position is stronger. The action to compel the sale was designed for you. You do not have to deposit the price when you file suit; you will, however, need to show that you genuinely intend and are able to buy (mortgage pre-approval, proof of funds). Also consider promptly seeking an injunction to prevent the seller from selling to a third party during the litigation — there, the interlocutory injunction plays its true preservative role. And if the promise provided for preliminary steps that the seller is blocking, you can ask the court to order their performance.
If you are drafting or negotiating a promise or a purchase agreement. This ruling is an invitation to spell out what happens in the event of a dispute. A clause that clearly provides for the deposit of the price, or a guarantee, if a dispute arises — and not merely as a closing step — changes the picture, as the distinction drawn with Boriamos illustrates. Also draft your due-diligence conditions without ambiguity: much of this case turns on whether a Phase II environmental study could be required or not.
In every case. An accepted offer to purchase is a contract, not a mere letter of intent. Before signing, make sure your conditions (financing, inspection, sale of your own property) are properly written, with precise deadlines. Before backing out, have someone check whether a condition truly allows you to do so: withdrawing without the right to do so exposes you to a lawsuit that can cost far more than the deposit.
This column is published for general information purposes only and does not constitute legal advice. Because every situation is unique, you should consult a lawyer for advice tailored to your own case. Feel free to contact Virtulex avocats to discuss your situation.
William Desrochers, Attorney, Virtulex avocats — www.virtulexavocats.com
Reference: Satys Aerospace c. IMP Group Limited, 2026 QCCA 1140 (Court of Appeal of Quebec, August 26, 2026, Vauclair, Moore and Baudouin JJ.A.; file 500-09-031593-254) — Read the decision on CanLII (French only). See also De Chanteloup c. St-Laurent, 2021 QCCA 90 — CanLII.
