Two recent Supreme Court of Canada decisions demonstrate that the corporate attribution doctrine is not a one-size-fits-all approach.

Overview

In the recent decision of Invico Diversified Income Limited Partnership v NewGrange Energy Inc, 2024 ABKB 214 (“NewGrange”), the Alberta Court of King’s Bench clarified when gross overriding royalties (“GOR”) can be vested out of a debtor company’s estate pursuant to a reverse vesting order (“RVO”). The Court allowed GORs to be vested off under the Applicant’s, Invico Diversified Income Limited Partnership (“Invico”), proposed RVO, finding the GORs to be mere contractual rights and not proper interests in land.

Court approval of a sale process in receivership or Bankruptcy and Insolvency Act (“BIA”) proposal proceedings is generally a procedural order and objectors do not have an appeal as of right; they must seek leave and meet a high test in order obtain it. However, in Peakhill Capital Inc. v.

Case Trends

The recent decision from the Court of King’s Bench of Alberta (the “Court”) in Qualex-Landmark Towers Inc v 12-1- Capital Corp, 2023 ABKB 109 (“Qualex”) greatly extended the protective umbrella for costs associated with environmental reclamation obligations.

In Golfside Ventures Ltd (Re) (2023 ABKB 86) the Court of King’s Bench of Alberta (the “Court”) reaffirmed the Court’s authority to exercise inherent jurisdiction in proceedings under the Bankruptcy and Insolvency Act (the “BIA”) in circumstances where (1) the BIA is silent or has not dealt with a matter exhaustively; and (2) the benefit of granting the relief outweighs th

The Bankruptcy Code confers upon debtors or trustees, as the case may be, the power to avoid certain preferential or fraudulent transfers made to creditors within prescribed guidelines and limitations. The U.S. Bankruptcy Court for the District of New Mexico recently addressed the contours of these powers through a recent decision inU.S. Glove v. Jacobs, Adv. No. 21-1009, (Bankr. D.N.M.

In In re Smith, (B.A.P. 10th Cir., Aug. 18, 2020), the U.S. Bankruptcy Appellate Panel for the U.S. Court of Appeals for the Tenth Circuit recently joined the majority of circuit courts of appeals in finding that a creditor seeking a judgment of nondischargeability must demonstrate that the injury caused by the prepetition debtor was both willful and malicious under Section 523(a)(6) of the Bankruptcy Code.

Factual Background

In a recent decision, the U.S. Bankruptcy Court for the Southern District of New York held that claim disallowance issues under Section 502(d) of the Bankruptcy Code "travel with" the claim, and not with the claimant. Declining to follow a published district court decision from the same federal district, the bankruptcy court found that section 502(d) applies to disallow a transferred claim regardless of whether the transferee acquired its claim through an assignment or an outright sale. See In re Firestar Diamond, 615 B.R. 161 (Bankr. S.D.N.Y. 2020).

InIn re Juarez, 603 B.R. 610 (9th Cir. BAP 2019), the Bankruptcy Appellate Panel of the U.S. Court of Appeals for the Ninth Circuit addressed a question of first impression in the circuit with respect to property that is exempt from creditor reach: it adopted the view that, under the "new value exception" to the "absolute priority rule," an individual Chapter 11 debtor intending to retain such property need not make a "new value" contribution covering the value of the exemption.

Background