Companies restructuring under the Companies’ Creditors Arrangement Act (“CCAA”) depend on a supply of critical products and services in order to continue operations during the proceedings. An interruption in the supply of such goods and services would likely be fatal to any restructuring. Prior to 2009, the CCAA was silent about how the post-filing supply of such goods and services was to be obtained. The CCAA provided only that a supplier could not be forced to supply on credit.
On July 6, 2012, in Lightsquared LP (Re),1 the Ontario Superior Court of Justice (the "Ontario Court"), released reasons that clarify the criteria for the identification of the centre of main interest ("COMI") of an applicant seeking recognition of foreign insolvency proceedings as "Foreign Main Proceedings" pursuant to Section 46 of the Companies' Creditors Arrangement Act ("CCAA").2
The Take-Away
Missing the limitations period for bringing a court action to recover a debt does not extinguish other legal rights and remedies in respect of that debt, such as bringing an application for bankruptcy or proving a claim in a bankruptcy estate.
The Case
A recent case illustrates the importance of clarity in the contractual arrangements associated with the disposition of a debtor’s assets. In the case, the Court appointed receiver was given Court approval for an auction services agreement. Under that agreement, the auctioneer was to conduct an auction sale of the debtor’s assets and was entitled to charge and collect a buyer’s premium equal to a minimum of 12% of the sales price.
Where an insured deposit taking institution (and let’s just call it abank to make things easy) is subject to a receivership order under the Canada Deposit Insurance Corporation Act (CDIC Act) the government can incorporate a bridge bank to take over the good assets and run the bank until it can be sold. If it does so the usual exemptions from the statutory stays for termination, netting and collateral enforcement for el
Bill C-45 proposes changes to the Payment Clearing and Settlement Act to enhance certainty that clearing house default rules will be enforceable in the event of a clearing member default. These reforms are an important aspect of financial markets reforms
On September 6, 2012, the Commission des lésions professionnelles (the CLP) deliberated on the interpretation of article 316 of An Act Respecting Industrial Accidents and Occupational Diseases(the Act) which states that the Commission de la santé et de la sécurité du travail (the CSST) can require from an employer that retains the services of a contractor to pay the assessment due by said contractor.
In the recent decision of Frank v. Farlie, Turner & Co., LLC, 2011 ONSC 5519, Mr. Justice Perell of the Ontario Superior Court of Justice found, among other things, that punitive damages are not available under Part XXIII.1 of the Ontario Securities Act as such damages are inconsistent with the scheme and purpose of Ontario’s statutory secondary market disclosure liability regime. In so doing, the court confirmed the fundamental importance of liability limits in continuous disclosure claims against directors and officers.
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