Advocis has filed a statement of defence in court, denying all allegations made by a cybersecurity firm seeking more than $560,000 for breach of contract, and for breaching duties to act honestly and in good faith. The association also made a counterclaim against the firm for breach of contract and unjust enrichment. Advocis is asking for nearly $185,000 in damages.
According to court filings, Burlington, Ont.–based Net-Patrol International Inc. provided Advocis with forensic analysis and investigation services beginning in September 2023, and the two parties later entered a contract in 2024 for risk management and cybersecurity services.
The statement of defence, filed on April 17 with the Ontario Superior Court of Justice in Toronto, argues that the claim against Advocis and Advocis Broker Services Inc. (ABS) brought by Net-Patrol is “fundamentally flawed,” because the contract between the parties allowed for termination with 30 days’ written notice, which Advocis provided.
Further, Net-Patrol’s services were “deficient, overpriced and incomplete,” the statement of defence alleges. “Advocis and ABS were within their rights to terminate the [Net-Patrol] agreement.”
In its counterclaim, Advocis seeks damages of $184,616.
“We are confident this claim is without merit as outlined in the statement of defence,” Advocis said in an emailed statement. “This is not the path we would have chosen, but we will not hesitate to defend the integrity of our operations and the responsible use of member dues. We remain focused on supporting our members and advancing the value of professional financial advice in Canada.”
Advocis and ABS, along with the other defendants — Geoff Le Quelenec, vice-president of technology and innovation with Advocis, and his corporation Jacobs L P Inc. — are asking for the action to be dismissed with costs on a full indemnity basis.
Legal counsel for Advocis and for Net-Patrol didn’t respond to requests for comment.
Net-Patrol’s claim against Advocis and ABS, filed in February, asks for $562,349.46, and seeks the same amount from Le Quelenec and his corporation for inducing breach of contract “and/or intentional interference with economic relations.” The claim also asks for damages of $200,000 plus legal costs.
Net-Patrol amended its original claim to note Advocis’ “financial difficulties,” alleging that Advocis terminated the contract “as part of a larger strategy” to reduce its financial obligations.
“Net-Patrol pleads that this strategy has also been employed by Advocis to avoid or reduce its payment or financial commitments to SeeWhy Financial Learning Inc. and various employees, including its former chief executive officer, Greg Pollock, its former chief operating officer, Julie Martini, and its former interim chief executive officer, Harris Jones,” the amendments allege.
‘Scandalous’ allegations
Net-Patrol’s latest allegations are “scandalous,” Advocis’ statement of defence says, and “pleaded with the intention of embarrassing and harming Advocis’ and ABS’ reputations.”
Jones, interim CEO from September 2023 to September 2024, was tasked with stabilizing the association’s finances after it struggled with liquidity. In September 2023 on Advocis’ behalf, the association’s legal counsel initially “engaged” Net-Patrol to provide forensic analysis and investigation services “in the context of litigation,” the statement of defence says. The agreement in question, for risk management and cybersecurity services, was later established in July 2024, it states.
In October 2024, after Kelly Gorman was appointed CEO, the “new management, including Le Quelenec, were not made fully aware” of the terms of the agreement with Net-Patrol, the defence states, such as services and rates. “In particular, Jones had advised Gorman that he had not entered into any contracts on behalf of Advocis,” it states.
Jones didn’t respond to a request for comment.
In the past 16 months, five legal claims have arisen against Advocis, including one from longtime CEO Pollock, who sued for wrongful dismissal in December 2023. The dispute was settled in November 2024, along with a claim of wrongful dismissal from Martini.
Huntsville, Ont.–based SeeWhy Financial Learning Inc. filed a suit against the association in February alleging breach of contract. The case in ongoing. SeeWhy settled a similar claim with Advocis in 2024.
Also in February, Advocis informed members of a human rights complaint. It was filed that month by a laid-off former employee.
While Net-Patrol claims Advocis terminated the agreement on Oct. 28, 2024, the statement of defence says Le Quelenec, acting on Advocis’ behalf, asked Net-Patrol for the agreement to be “paused” for review. This review of the agreement and of Net-Patrol’s work “revealed several notable deficiencies,” the defence alleges, such as a failure to complete specified services and demonstrate appropriate expertise.
Advocis then provided written notice of termination on Nov. 28, 2024, according to the defence, and advised Net-Patrol that the association would pay amounts specified in the agreement for the next 30 days — calculated as $24,500. However, Net-Patrol issued no invoice for the amount, the defence states, and provided no services from Oct. 28.
Contrary to the claim, the statement of defence denies that the full amount of the agreement for its two-year term became due at termination or that Advocis or ABS owes Net-Patrol the amount it seeks.
“Advocis and ABS deny that they breached any term … of the cybersecurity agreement as alleged,” the statement of defence says. “Advocis and ABS further deny that they breached their ‘duty to act in good faith and honestly’” to Net-Patrol by ending the agreement. The defence also denies any liability or wrongdoing on the part of Le Quelenec and his corporation.
Advocis paid Net-Patrol “at least” $184,616 in fees directly, the statement of defence says, excluding any amounts paid through legal counsel.