On January 31, 2019, the Supreme Court of Canada decided, in Orphan Well Association v. Grant Thornton Ltd., that a provincial regulator, in this case the Alberta Energy Regulator (the “AER”), can enforce end-of-life obligations with respect to oil wells, pipelines and other provincially regulated facilities belonging to a bankrupt company or its trustee in bankruptcy, even if the enforcement orders adversely affect the assets in the bankrupt’s estate and its secured creditors.
Le 31 janvier 2019, dans l’affaire Orphan Well Association c. Grant Thornton ltée., la Cour suprême du Canada (« CSC ») a décidé qu’un organisme de réglementation provinciale, en l’espèce l’Alberta Energy Regulator (« AER »), peut exiger le respect des obligations de fin de vie de puits, pipelines et autres installations assujetties aux règlements provinciaux d’une société en faillite ou de son syndic, même si les ordonnances de l’AER causent un préjudice à l’actif du créancier ou aux créanciers garantis.
Control to Serbian Creditors- the amendments to the Serbian Insolvency Act
The recent amendments to the Serbian Insolvency Act enacted 9 December 2018 have placed more control into creditors’ hands allowing them to suggest the insolvency administrator to be appointed, as well as providing less restrictive provisions on the proposers of reorganisation proposals.
Background
Virginia Hills Oil Corp. was a small publicly traded oil producer with assets in north central Alberta. Some of its assets were held through its subsidiary Dolomite Energy Inc. (collectively the "Debtors"). The Debtors' main secured creditors were the Alberta Treasury Branches and the Bank of Nova Scotia (the "Banks"). The Debtors also owned a pipeline that passed through three municipalities (the "Municipalities").
On February 12, 2019, the Court of Appeal of Alberta (Court) released its long-anticipated decision in Northern Sunrise County v. Virginia Hills Oil Corp. (Virginia Hills).
On February 4, 2019, the Quebec Court of Appeal (Court of Appeal) ruled in the restructuring proceedings of Bluberi Gaming Technologies Inc., now 9354‑9186 Québec Inc., et al. (Bluberi) that under the Companies’ Creditors Arrangement Act (Canada) (CCAA), creditors have a right to vote in their own self-interest. In so doing, the Court of Appeal reversed the lower court’s decision.
In a recent Bennett Jones Update—Property Tax Priorities in Alberta Insolvency Proceedings: Current Uncertainty—we discussed three recent decisions of the Court of Queen's Bench of Alberta that had addressed the question of the priority of municipal property taxes in insolvency proceedings.
On January 31, 2019, the Supreme Court of Canada released its decision in Orphan Well Association v. Grant Thornton Ltd., popularly known as Redwater. In a 5-2 split decision, a majority of the Supreme Court allowed the appeal and held that the Alberta Energy Regulator’s (AER/Regulator) assertion of its statutory enforcement powers over an insolvent licensee’s assets does not create a conflict with the federal Bankruptcy and Insolvency Act (BIA) as to trigger the constitutional doctrine of federal paramountcy.
On February 1, 2019, the Supreme Court of Canada (SCC) released its highly anticipated decision in the Orphan Well Association, et al. v. Grant Thornton Limited, et al, 2019 SCC 5 (Redwater).
In a landmark decision released on January 31, 2019, the Supreme Court of Canada (SCC) ruled in Orphan Well Association v Grant Thornton Ltd. that the environmental remediation obligations of a bankrupt oil and gas company must be fulfilled in priority over all other claims, including secured claims. In addition to immediate effects to creditors of Alberta oil and gas interests, creditors of all sectors will want to analyze the implications of this case.
Background