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.

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.