With data privacy issues constantly in the news, what do businesses need to know about handling personal information when they’re considering bankruptcy, especially if some personal information – like customer records – may be a valuable asset?

With data privacy issues constantly in the news, what do businesses need to know about handling personal information when they’re considering bankruptcy, especially if some personal information – like customer records – may be a valuable asset?

This significant recent decision of the Supreme Court of Canada confirms (i) that a CCAA supervising judge enjoys broad discretion and the necessary jurisdiction to prevent a creditor from voting on a plan of arrangement when the creditor is acting for an improper purpose, and (ii) that litigation funding is not intrinsically illegal and that a litigation funding agreement can be approved by the Court as an interim financing in insolvency.

Cette importante décision prononcée dernièrement par la Cour suprême du Canada confirme : (i) que le juge chargé d’appliquer la LACC possède un vaste pouvoir discrétionnaire et la compétence nécessaire pour empêcher un créancier de voter sur un plan d’arrangement s’il agit dans un but illégitime, (ii) que le financement de litiges n’est pas intrinsèquement illégal et qu’un accord de financement de litige peut être approuvé par la Cour à titre de financement temporaire en situation d’insolvabilité.

This significant recent decision of the Supreme Court of Canada confirms (i) that a CCAA supervising judge enjoys broad discretion and the necessary jurisdiction to prevent a creditor from voting on a plan of arrangement when the creditor is acting for an improper purpose, and (ii) that litigation funding is not intrinsically illegal and that a litigation funding agreement can be approved by the Court as an interim financing in insolvency.

The High Court decision in Re All Star Leisure (Group) Limited (2019), which confirmed the validity of an administration appointment by a qualified floating charge holder (QFCH) out of court hours by CE-Filing, will be welcomed.

The decision accepted that the rules did not currently provide for such an out of hours appointment to take place but it confirmed it was a defect capable of being cured and, perhaps more importantly, the court also stressed the need for an urgent review of the rules so that there is no doubt such an appointment could be made.

In certain circumstances, if a claim is proven, the defendant will be able to offset monies that are due to it from the claimant - this is known as set off.

Here, we cover the basics of set off, including the different types of set off and key points you need to know.

What is set off?

Where the right of set off arises, it can act as a defence to part or the whole of a claim.

In our update this month we take a look at some recent decisions that will be of interest to those involved in insolvency litigation. These include:

Creditor not obliged to take steps in foreign proceedings to preserve security

No duty of care owed for negligent bank reference to undisclosed principal

The Supreme Court has held that a bank which negligently provided a favourable credit reference for one of its customers did not owe a duty of care to an undisclosed principal who acted on that reference.