Jurisprudence canadienne récente en matière d’insolvabilité : ce que les prêteurs doivent savoir Linc Rogers, Caitlin McIntyre et Ilia Kravtsov L’issue d’un certain nombre de dossiers d’insolvabilité portés devant les tribunaux de diverses provinces du Canada en 2017 pourrait avoir une incidence importante sur les droits de réalisation et de recouvrement des prêteurs commerciaux dans le cadre de procédures de restructuration et d’insolvabilité.

The difference between debt and equity claims can cause confusion among lenders, creditors, and insolvency professionals alike. In Tudor Sales Ltd. (Re), the British Columbia Supreme Court provided further judicial guidance on this distinction.

When negotiating a commercial lease, it is in the landlord’s best interest to require that securities be provided by the prospective tenant in order to protect the landlord against the tenant’s failure to perform its obligations under the lease. A frequent cause of a tenant’s inability to perform its obligations is its insolvency or financial difficulties.

Lors de la négociation d’un bail commercial, le bailleur a tout intérêt à exiger des garanties de son futur locataire pour se protéger en cas d’inexécution des obligations de celui-ci. Une cause fréquente du manquement par le locataire à ses obligations est son insolvabilité ou des difficultés financières. Or, il est important pour tout bailleur de savoir que la faillite d’un locataire ou le dépôt par celui-ci d’un avis d’intention ou d’une proposition aux termes de la Loi sur la faillite et l’insolvabilité (« L.F.I.

When negotiating a commercial lease, the lessor has every interest in demanding guarantees from his future tenant to protect himself in case of non-fulfillment of his obligations. A common cause of the tenant's breach of his obligations is his insolvency or financial hardship. However, it is important for any lessor to know that a tenant's bankruptcy or filing of a notice of intention or a proposal under the Bankruptcy and Insolvency Act (" LFI ") may have the effect of annihilating the protection offered by certain guarantees.

2017 saw a number of interesting and important developments in Canadian insolvency and restructuring matters. Some of the highlights (which, in certain instances, will continue as issues in 2018 and beyond) are set forth below:

1) Trends: Fewer CCAA Filings and Retail Insolvencies in the News

Until a court orders otherwise, a monitor appointed under the Companies’ Creditors Arrangement Act is a neutral party and may not take sides in favour of one stakeholder over another.

In a January 31, 2018 decision from the bench in the matter of Royal Bank of Canada v. A-1 Asphalt Maintenance Ltd. (Court File No. CV-14-10784-00CL) (“A-1 Asphalt”), Madam Justice Conway of the Ontario Superior Court of Justice (Commercial List) (the “Court”) held that the deemed trust provisions of subsection 8(1)(a) of the Construction Lien Act (Ontario) (the “CLA”) were not, on their own, sufficient to create a trust recognized in a contractor’s bankruptcy or proposal proceedings.

Encrypted digital currencies (“cryptocurrencies”),1 particularly Bitcoin, have recently become the target of enormous international speculation and market scrutiny. Some expect cryptocurrency payments and other transactions tracked via distributed ledger technology (“DLT”, of which “blockchain” technology is one example) to be the future of commercial interaction. The theory is that cryptocurrencies could become “the holy grail of commerce – a payment system that would eliminate or minimize the roles of third party intermediaries.”2

An equipment finance company finances the purchase of a truck and registers a purchase-money security interest (a “PMSI”) pursuant to the Personal Property Security Act (Ontario) (the “PPSA”) to protect its interest. The truck breaks down and is taken in for repairs. While the truck is in the shop, the debtor defaults under its lending arrangements with the equipment finance company.