Insolvency & Restructuring Bulletin

A recent court decision has provided clarity on the application of the Wage Earner Protection Program Act (“WEPPA”) to former employees of companies undergoing restructuring under the Companies’ Creditors Arrangement Act (“CCAA”). The central issue was whether WEPPA applies to employees who were terminated as a result of a reverse vesting order (“RVO”).

Background

BP Canada Energy Group ULC (“BP”) has applied for leave to appeal a decision under section 13 of the Companies’ Creditors Arrangement Act (the “CCAA”) and for a stay of the orders rendered by Justice Yamauchi on April 24, 2024

Case Trends

Introduction

Introduction

On March 23, 2020, we commented on the Quebec Court of Appeal’s decision in the Arrangement relating to Consultants SM inc. case. The City of Montreal (the “City”) appealed this decision to the Supreme Court of Canada and the appeal was heard on May 20, 2021.

On December 10, 2021, the Supreme Court of Canada (the “Supreme Court”) dismissed the City’s appeal, thereby rendering an important decision with respect to “pre-post compensation” and “non-dischargeable debts” under the Companies’ Creditors Arrangement Act (the “CCAA”).

Le 23 mars 2020, nous avons commenté l’arrêt de la Cour d’appel du Québec dans le dossier Arrangement relatif à Consultants SM inc. La Ville de Montréal (la « Ville ») a porté cet arrêt devant la Cour suprême du Canada et l’audition du pourvoi a eu lieu le 20 mai 2021.

On March 17, 2020, the Court of Appeal of Québec (the "Court") issued an important ruling concerning "pre-post" compensation and "non-dischargeable" debts under the Companies' Creditors Arrangement Act (the "CCAA"), by finding that the debt of a municipality arising from an agreement entered into as part of a voluntary reimbursement program ("VRP") under the Act to ensure mainly the recovery of amounts improperly paid as a result of fraud or fraudulent tactics in connection with public contracts ("Bill 26") is unsecured debt in connection with the insolvency of a co-contra

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.