Case Trends
Today, amendments to the Bankruptcy and Insolvency Act (BIA)and the Companies’ Creditors Arrangement Act (CCAA), introduced to Parliament in April 2019 as Bill C-97, came into force. Certain of these amendments are likely to impact the usual flow of business among insolvency and restructuring professionals.
On February 1, 2013, the Supreme Court of Canada released its decision in Sun Indalex Finance, LLC v. United Steelworkers[1]. The ruling:
In the recent decision in the CCAA Proceedings of Timminco Ltd. et al.[1], the Ontario Court of Appeal has affirmed the CCAA Court’s jurisdiction to grant super-priority status to DIP financing charges (including over provincial deemed trusts) and, effectively, confirmed that a supervising CCAA Court has a broad discretion to do so.
In a recent decision in the Companies’ Creditors Arrangement Act (“CCAA”) Proceedings ofTimminco Ltd. et al.[1], Justice Morawetz of the Ontario Superior Court of Justice [Commercial List] observed that the disclaimer provisions of the CCAA apply equally in the context of a restructuring plan and a sales process.
The Ontario Court of Appeal recently addressed the issue of pension deficits in the context of a restructuring under the Companies' Creditors Arrangement Act (the "CCAA"). However, unlike past decisions, in Re Indalex the Court held that such deficits may have priority against monies advanced under interim debtor-in-possession ("DIP") financing agreements authorized by a CCAA judge. This apparent departure from the conventional understanding of the priority of pension deficit claims and related issues should raise concerns for lenders, employers, and plan administrators.
In 2005, Parliament passed a comprehensive package of reforms to Canadian insolvency and restructuring laws. The purpose of these amendments was to provide additional protections for employees, codify existing case law and practice, bolster the proposal process and conform Canadian laws concerning cross-border insolvencies to international practice.