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

When you read the papers do you start from the front or back? I usually skim read the front-page headlines and immediately flick to the back (sport) pages. It’s less dispiriting that way. Or if it’s the weekend, I fumble my way through the different sections, past the gazillions of adverts showcasing tyre inflators and hair loss treatments, before I land at the sports section. They don’t make it easy for you do those weekend editors.

Junior debt – sometimes referred to as subordinated debt, occasionally talked about as mezzanine debt – is referred to as such because it ranks behind other, more senior, debt owing by the same borrower. Junior creditors can come in many different shapes and sizes and can include shareholder lenders and specialist debt investors or funds.

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.

In the current difficult business environment, lenders will be weighing up their options in respect of defaulting borrowers – for some lenders that might include attempting to own the underlying business through a credit bid. Where debt is trading at a discount, a credit bid can also be a cost-efficient opportunity for an opportunistic buyer to acquire assets. So, what is a credit bid and what issues might such parties need to consider in using one?   

What is a credit bid?

KEY POINTS

Friday's Business section of The Times made interesting reading to us debt finance nerds.

In this week’s TGIF, we consider the recent case of Vita Group Ltd, in the matter of Vita Group Ltd [2023] FCA 400, in which his Honour Justice Jackman outlined practical changes to the way schemes of arrangement should be implemented through the Federal Court to make them simpler, faster and more cost efficient.

Key takeaways

In this week’s TGIF, we consider the Federal Court’s recent decision inFotios (Bankrupt) v Helios Corporation Pty Ltd (No 3) [2023] FCA 251, and earlier decisions in the same proceedings, clarifying the current Australian position as to priorities between creditors of successive trustees.

Key takeaways

A raft of new legislation was introduced during the pandemic with the aim of shielding businesses from the full economic impact of lockdown. One such piece of legislation was the Corporate Insolvency and Governance Act 2020 (CIGA). Some of the protections implemented by CIGA were temporary – for example, restrictions on the presentation of winding up petitions or the suspension of liability for wrongful trading. However, a number of permanent changes to insolvency legislation remain in force.