With international trade rarely making the news in this era of stable foreign relations and respectful international dialogue, you can be forgiven if you are unaware that Canada has entered several trade agreements that require it to protect trade secrets. But can Canada be forgiven for never actually enacting trade secret legislation? Maybe we can because of Canada’s substitute: the common law action for “breach of confidence”.

In a recent decision, the Federal Court of Appeal had occasion to consider a claim at the crossroads of bankruptcy and maritime law (ING Bank N.V. v. Canpotex Shipping Services Limited et al., 2017 FCA 47). Normally in Canada, bankruptcy cases are adjudicated in the superior courts of the respective provinces.

A Commentary on Recent Legal Developments by the Canadian Appeals Monitor

Since our last post, the Supreme Court has released a significant trilogy of judgments involving issues of federal paramountcy and the Bankruptcy and Insolvency Act (the “BIA”).

The Supreme Court has announced it will hear the appeal in the high profile Indalex Ltd., Re. The appeal is of great interest to the commercial litigation, insolvency and pension bar. Its outcome will be closely watched and may have dramatic impact on Canadian corporate reorganizations.

Background

All businesses know that one key to profitability is risk management. Particularly in such industries as oil and natural gas, eligible financial contracts have emerged as an invaluable tool to hedge the risk associated with volatile foreign currency exchange, interest rates and commodity prices. Indeed, a large business has developed proffering over-the-counter derivatives (or ‘swaps’) and standardized exchange-traded derivatives (or ‘futures’) to do just that.

In a year quite unlike any other, the landscape of Canadian restructuring law saw significant developments in 2020. The COVID-19 crisis put novel issues before the courts, challenged businesses in unforeseen ways and saw various supports and concessions offered to struggling businesses from governments and creditors. Ultimately, while the supports and concessions enabled many businesses to avoid insolvency proceedings in 2020, many others sought the protection of an insolvency filing, with industries such as the retail industry particularly impacted.

Extensive amendments to the Bankruptcy and Insolvency Act (“BIA”) and Companies’ Creditors Arrangement Act (“CCAA”) coming into force on November 1, 2019 through Bill C-97 will have a significant effect on certain aspects of insolvency proceedings commenced after that date. The wide-ranging revisions to both the BIA and CCAA will likely foster changes to the currently existing insolvency and restructuring practice in Canada.

Bill C-97 Overview

Bill C-97 amends both the BIA and CCAA to:

Over the last year, several court decisions have touched on the legislative conflict between taxation authorities and secured creditors in insolvency situations.

The restructuring of Sanjel Corporation and its affiliates (previously discussed here) continues to provide interesting developments on the application and interpretation of the Companies’ Creditors Arrangement Act.

In the spring of 2010, BioSyntech, a start-up biotechnology company, developing a cartilage-repair product, BST-Car Gel, filed a Notice of Intention to make a proposal under the Bankruptcy and Insolvency Act. In the subsequent bankruptcy proceedings, the intellectual property relating to the BST-Car Gel was sold.