Awards and citations:

1997: Le Prix du Champagne Lanson Noble Cuvée Award for investigations into Champagne for the Millennium investment scams

2001: Le Prix Champagne Lanson Ivory Award for

2011: Vindic d'Or MMXI – 'Meilleur blog anti-1855'

2011: Robert M. Parker, Jnr: ‘This blogger...’:

2012: Born Digital Wine Awards: No Pay No Jay – best investigative wine story

2012: International Wine Challenge – Personality of the Year Award

Saturday, 3 November 2012

A Canadian horror story – SAQ sued for ruining a 'world class collection of wine'

SAQ: offer to store your wine:
'they also offer controlled temperature and humidity for guaranteed high quality aging conditions'

Robert Chiraz*, a wine collector living in Montreal, is suing the SAQ (Société des Alcools du Québec) alleging that his 'world class' wine collection has been ruined by a failure of the temperature and humidity controls in their client wine cellars at Chateau du Glana in Montreal. According to expert valuer Stephen Ranger Chiraz's wine bottles are now in 'a distressed to catastrophic condition'. According to his report: 'Mr. Ranger recommends that the wine remaining in the cellar be destroyed as it poses a health risk.

Chiraz is demanding damages of $926,616.20. Below is a copy of the motion to introduce proceedings in damages.

Some details and a link to this post are now on Vin Quebec here. Otherwise to date the case has received little coverage in Canadathe SAQ is a powerful organisation. Journalists can contact Robert Chiraz on 
  * With a name like Chiraz you would have to be interested in wine!

 C A N A D A

S U P E R I O R     C O U R T
(Civil Division)

ROBERT CHIRAZ, residing and domiciled at 10340, Paul Comtois, in the City of Montreal, Province of Quebec, H4N 2Y5;

SOCIÉTÉ DES ALCOOLS DU QUÉBEC a legal person duly constituted under the law having its head office at 905, De Lorimier Avenue, in the City of Montreal, Province of Quebec, H2K 3V9;


(Article 110.1 C.C.P.)


1.              Plaintiff is a wine connoisseur and collector who has, over the years, established, at great expense to himself, an extensive, unique and rare wine collection comprised of numerous premier vintages;
2.              Defendant Société des alcools du Québec (hereinafter the “SAQ”) is a provincial government-owned corporation responsible for the trade of alcoholic beverages within the province of Québec, the whole as it appears from a copy of the État des Renseignements d’une personne morale communicated herein in support hereof as Exhibit P-1;

3.              On or about the 14th of July, 2008 Plaintiff leased from Defendant a wine cellar bearing number 003 and which name is  Chateau du Glana located at 390, Laurier Avenue West, in the City of Montreal, the whole as it appears from a copy of the Rental Agreement communicated herein in support hereof as Exhibit P-2;
4.              Said Rental Agreement was automatically renewed by the parties in 2009, 2010, 2011 and 2012, the whole as per article 2.2 of the Rental Agreement (P-2);
5.              At the time of the events hereinafter set out, Plaintiff had continuously met all of his obligations under the Rental Agreement, including but not limited to the payment of the monthly rent to Defendant;
6.              In exchange for the payment of the monthly rent, Defendant, bound and obliged itself towards Plaintiff, namely, to:
« b) à prendre tous les moyens raisonnables pour maintenir dans la cave à vin une température constant et uniforme favorable à la conservation et au vieillissement des vins;
c) à prendre tous les moyens raisonnables pour que des boissons alcooliques entreposés dans le cellier soient à l’abri des odeurs, des trépidations et de toute autre source de détérioration ou de contamination; »
the whole at it appears from article 5.1 of the Rental Agreement (P-2);

7.              On the 10th of February, 2010, Plaintiff attended at the leased premises and discovered that Defendant’s humidity and temperature control systems had failed in the whole cellared area, the failure of which systems caused his entire wine collection to have been subjected to irreparable damaging temperature and humidity variations;
8.              Immediately upon entry into his leased cellar, Plaintiff noticed the high humidity level in the room, that most of the surfaces in the room were wet and damp, including the racks, cases and wine bottles, and that a piece of insulation had fallen from the ceiling of the room on the floor and bottles beneath. Plaintiff also noted water which had pooled into puddles in the common areas of the cellared area;
9.              Upon Plaintiffs return to the premises a week or so later he discovered that mould had in sprouted on the wine bottles, the corks, the bottles ‘capsules, the bottles’ labels wooden crates, as well as on the walls and floors of the cellar, the whole as it appears from a series of photographs taken by Plaintiff communicated herein in support hereof as Exhibit P-3, en liasse;
10.           Plaintiff, who had last attended at his cellar during the Christmas and New Year 2009-2010 period, was shocked and appalled by the condition of the leased premises which did not exist at the time of his last visit;
11.           In fact, at the time of his last visit, Plaintiff was not struck by any temperature or humidity anomalies and Plaintiff noted no water accumulation, condensation or mould on any part of his collection or the cellar having perused his collection and the leased premises at that time;
12.           On the 11th of February, 2010, Plaintiff verbally advised Defendant’s representative Guylaine Paquette of these facts hereinabove set out and it was on the 16th of February 2010, that Plaintiff, accompanied by Defendant’s representatives, who would not meet Plaintiff before said date, once again attended at the leased premises and discovered to his great dismay and consternation that the presence of mould had exponentially increased on all surfaces from the previous week;
13.           In order to fully determine the impact of the temperature and humidity level variation, as well as the mould, on his wine collection, Plaintiff retained the services of numerous well respected experts in order to carry out air analyses and oenological inspections of the wine collection as hereinafter set out;
14.           On the 27th of February 2010, Air Labs Analyse/Diagnostic (“Air Labs”) did attend at the leased cellar and collected a certain number of samples in order to analyse the mould spores and air quality of the cellar;
15.           On the 18th of March 2010, Air Labs issued a first report which concluded inter alia that:
a)    The was a high quantity of Penicillium, Aspergillus and Hyphes in the cellar and common areas of the premises, all of which are mould causing bacteria;
b)    That the air in the cellar at the time of the visit was extremely contaminated with Penicillium and Aspergillus mould spores;
The whole as it appears from a copy of the first Air Labs report communicated herein in support hereof as Exhibit P-4;
16.           On the 22nd of March 2010, Air Labs issued a second report which concluded that at the time of their visit the temperature in Plaintiff’s leased cellar was  between + 14.4 degrees Celsius and +16.11 Degrees Celsius and that the humidity level was between 30% and 44%, the whole at it appears from a copy of the second Air Labs report communicated herein in support hereof as Exhibit P-5;
17.           On the 20th of April 2010, Air Labs issued a third report which concluded that the Penicillium, Aspergillus and Hyphes had contaminated the labels and interior of the wine bottles to the point that mould had sprouted between the cork and the capsule top of certain bottles, the whole as it appears from a copy of the third Air Labs report communicated herein in support hereof as Exhibit P-6;
18.           On the 23rd of June 2011, subsequent to a visit carried out on March 22nd, 2010, OenQuebec issued a report which concluded, inter alia, that:
a)    There was visible soiling and damage to the labels and capsules of the bottles;
b)    There was deterioration and contamination to the wooding crates housing the wine;
c)     There was mould development on the bottles, their labels, corks and capsules;
d)    That certain of the corks had dilated and migrated up the neck of the bottle to protrude though the top of the bottles;
e)    That the damage to the physical appearance of the bottles impacted the potential sale price of the bottles, assuming that the content of the bottles was undamaged;
f)     That the exposure to mould had greatly increased the probability of contamination of the wine on the medium and long term and that any contamination is irreversible;
g)    That on the date of their inspection the humidity level in the cellar was 40%, which is extremely low and in fact dry for a wine cellar. The consequence of this improper humidity level is that the bottles’ corks are susceptible to drying and movement thereby compromising the contents of the bottles;
h)    That ideal conditions for wine cellars are a temperature of 12-14 degrees Celsius and a humidity level of 65 to 70%;
i)     That it was evident that Plaintiff’ leased cellar had been subjected to strong temperature and hydrometric variations;
j)      That as a result of the strong temperature and hydrometric variations Plaintiff’s wine collection was at risk of medium and long term damage and that the quality of the collection could no longer be guaranteed;
The whole as it appears from a copy of OenQuebec’s report communicated herein in support hereof as Exhibit P-7;
19.           In April 2011, Stephen Ranger, an expert in fine art valuation, issued a written report pursuant to a visit which he made to Plaintiff’s lease cellar on January 24th, 2011, the whole as it appears from a copy of said report communicated herewith in support hereof as Exhibit P-8;
20.           In his report Mr. Ranger noted the following:
a)    Mould and water damage to the ceiling above the cellar;
b)    Mould and water damage on the observable portions of the walls of the cellar;
c)     Clear evidence of water having been on the floor;
d)    Temperature readings between 13.9 degrees Celsius an 10.8 degrees Celsius;
e)    Humidity readings between 30% and 38%;
f)     The presence of approximately 4000 bottles of wine in racks and their original wood cases;
g)    Wine bottles that were in a distressed to catastrophic condition;
h)    Over 200 bottles with visible mould and damaged labels, corks and capsules and a significant number of bottles showed mould seeping through the oxygen perforations in the capsules;
The whole as it appears from Exhibit P-8;
21.           Mr. Ranger was of the opinion that Plaintiff’s collection, based in the inventory list, is comprised of wines making it a “world class collection” and that a Fair Market Value of the number of wines from his collection, before the incident at the basis of the present motion, would be just under one million ($1,000,000) dollars, the whole as it appears from Exhibit P-8;
22.           Mr. Ranger was also of the opinion that, assuming Plaintiff would even be able to locate replacement bottles of an identical house, vintage and year, he would, as a result of strong growth of the wine market and escalation of prices, be in the position of paying between 50% and 100% more than his initial investment, which is his initial purchase price of the bottles, the whole as it appears from Exhibit P-8;
23.           Mr. Ranger went on to conclude in his report that “(i)t is without question that Mr. Chiraz’s collection has suffered catastrophic damage” as a result of water damage followed by dramatic fluctuations in both temperature and humidity, the whole as it appears from Exhibit P-8;
24.           Further, in Mr. Ranger’s learned expert opinion, from a market perspective, the wine collection has extremely limited potential to be brought to market as the current owner cannot guarantee to a prospective purchaser or agent, such as an auction house, in good faith, that the wines have been stored in ideal conditions, the whole as it appears from Exhibit P-8;
25.           Lastly, given the high level of mould present in the cellar, as well as on and in the bottles, Mr. Ranger recommends that the wine remaining in the cellar be destroyed as it poses a health risk, the whole as it appears from Exhibit P-8;
26.           As such, Plaintiff’s ability to sell the wines, or even minimize his damages, has been permanently compromised to the point of being negated, the whole as it appears from Exhibit P-8;

27.           At the recommendation of Defendant’s representative Jessica Harnois, Plaintiff retained the services of La Cave des Vents D’Ange (“CVA”) who did in fact, on the 7th and 11th of March 2010, conduct a full physical inventory and evaluation of the entirety of Plaintiff’s wine collection which was located in the leased premises;
28.           On the 6th of April 2010, CVA issued a detailed evaluation of Plaintiff’s collection which set out the physical damage which they noted, the presence of mold, damage to the cases, damage to the labelling, damage to the capsules on the top of the bottles, the whole as it appears from a copy of CVA’s inventory and evaluation communicated herein in support hereof as Exhibit P-9;
29.           CVA’s manual inventory determined that as of the 7th and 11th of March 2010, Plaintiff’s collection was comprised of 3147 wine bottles with a value of $913,796.74 as of the 6th of April 2010, the whole as it appears from Exhibit P-9;
30.           It is a clear and unanimous opinion among Plaintiff’s experts that Plaintiff’s wine collection was subjected to water damage and dramatic temperature and humidity level variations which caused catastrophic and irreversible damage to Plaintiff’s wine collection;
31.           Furthermore, the presence of numerous strains of mould throughout the cellar and well as on and in the bottles precludes Plaintiff from selling the collection as it is highly contaminated and poses a health risk;
32.           Also, in the event that Plaintiff would present any seemingly esthetically undamaged bottles for auction Plaintiff would not be able to warrant and represent that the wine had been stored in optimal conditions and would in fact have to disclose that it had been subjected to catastrophic temperature and humidity level shifts, as well as mould, further limiting if not completely eliminating any potential saleable value of the wine;
33.           It is clear that as a result of Defendant’s complete and utter failure to provide Plaintiff with a wine cellar which was conducive to the storage, conservation and maturing of wine, Plaintiff’s entire collection is a total loss;
34.           Plaintiff is also entitled to claim from Defendant all experts fees incurred to date, namely,
A)    Cave des Vents D’Angers                      $5,450.00
B)    OenQuebec                                            $1,765.56
C)    Airlabs Analyse/Diagnostic                $4,515.00
D)   Stephen Ranger                                     $4,088.90
Total:                                                      $15,819.46
The whole as it appears from a copy of the experts invoices communicated herein in support hereof as Exhibit P-10;
35.           On the 27th of April 2010, Plaintiff, through its undersigned attorneys, served upon Defendant a letter of demand detailing the facts which were known by Plaintiff at the time regarding the damages which he discovered on the 10th of February 2010 and calling upon Defendant to compensate Plaintiff for his losses, the whole as it appears from a copy of the letter and proof of transmission by facsimile communicated herein in support hereof as Exhibit P-11, en liasse;
36.           Defendant is responsible for the damages sustained by Plaintiff as a result of their complete and utter failure to respect their duties and obligations set forth in the Rental Agreement, namely to provide Plaintiff with a cellar shielded from temperature and humidity level oscillations, as well as to take all reasonable means to ensure that the cellared wine benefited from constant and uniform temperature levels;
37.           It is clear from the Airlabs and OenQuebec reports, as well as the uncontestable evidence of mould and water damage, the Defendant failed in its duties and obligations towards Plaintiff;
38.           Defendants’ failure is all the more egregious and grossly negligent in that Defendant failed to maintain its ventilation system, in which large quantities of mould and rust could be noted immediately after the event hereinabove set out, the whole as it appears from a copy of photographs taken by Plaintiff on March 7th and March 11th 2010 communicated herein in support hereof as Exhibit P-12, en liasse;
39.           Furthermore, unbeknownst to Plaintiff at the time of the events, Defendant had no functional temperature and humidity surveillance system which would have enabled them to detect a breach temperature and humidity control systems;
40.           As such, Defendant took no steps to ensure that it could meet its contractual obligations towards Plaintiff, even though Defendant is not without knowing that the sole purpose of cellaring within a SAQ cellar is to benefit from Defendant’s purported expertise in the field of wine and a temperature and humidity controlled environment suitable for the conservation and aging of wine collections, which are valuable;
41.           To date, Defendant has flatly refused to offer Plaintiff any reasonable and just compensation reflective of the approximate million dollar loss Plaintiff has suffered;
42.           Plaintiff is therefore entitled to claim from Defendant the sum of $929,616.20, to be perfected at trial;
43.           The present Motion to Introduce Proceedings is well founded in fact and in law;

[1]       GRANTS the present Motion to Institute Proceedings;
[2]       CONDEMNS Defendant to pay to Plaintiff the sum of $926,616.20, to be perfected at trial, together with legal interest and the additional indemnity granted pursuant to Article 1619 of the Civil Code of Quebec, as of April 27th 2010, date of the letter of demand;
[3]       THE WHOLE with costs against Defendant, including all experts’ fees for reports, preparation and attendance at trial. 

MONTREAL, October 19th, 2012
Attorneys for Plaintiff

(Article 119 C.C.P.)

Take notice that Plaintiff has filed this action or application in the office of the Superior Court of the judicial district of Montreal.
To file an answer to this action or application, you must first file an Appearance, personally or by advocate, at the Montreal Courthouse located at 1, Notre-Dame Street East, in Montreal, within ten (10) days of service of this motion.
If you fail to file an Appearance within the time limit indicated, a judgment by default may be rendered against you without further notice upon expiry of the 10-day period.
If you file an Appearance, the action or application will be presented before the Superior Court on NOVEMBER 30th, 2012 at 9:00 a.m., in room 2.16 of the Courthouse located at 1, Notre-Dame Street East, in Montreal.  On that date, the Court may exercise such powers as are necessary to ensure the orderly progress of the proceeding or the Court may hear the case, unless you make a written agreement with Plaintiff or Plaintiff’s advocate on a timetable for the orderly progress of the proceeding. The timetable must be filed in the office of the Court.
In support of its Motion to Institute Proceedings, Plaintiff also communicates its Exhibits with the service of such Motion, a list of which is enclosed herewith. 
MONTREAL, October 19th, 2012 
 Attorneys for Plaintif

No comments: