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2020 Year in Review: Highlights in Canadian Restructuring Law

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.

Canada, Insolvency & Restructuring, Litigation, McCarthy Tétrault LLP, Coronavirus, Supreme Court of Canada
Franchise agreements may be assigned to another franchisee without consent upon bankruptcy

A recent Alberta appellate decision establishes that a trustee in bankruptcy may sell a franchise agreement to a third party, in spite of objections by the franchisor, under the Bankruptcy and Insolvency Act (BIA). The Alberta Court of Appeal’s decision in Ford Motor Company of Canada Ltd v Welcome Ford Sales Ltd contains three important messages for franchisors:

Canada, Alberta, Franchising, Insolvency & Restructuring, Litigation, McCarthy Tétrault LLP, Bankruptcy, Consent, Legal burden of proof, Franchise agreement, Ford Motor Company, Bankruptcy and Insolvency Act 1985 (Canada), Trustee, United States bankruptcy court, Court of Appeal of Alberta