It is well-established that Canadian courts have jurisdiction to approve a plan of compromise or arrangement under the Companies’ Creditors Arrangement Act that includes releases in favour of third-parties. The leading decision on the issue remains Metcalfe & Mansfield Alternative Investments II Corp., which arose in response to the liquidity crisis that threatened the Canadian market in asset-backed commercial paper after the U.S.
After the SAM HAWK decision in September 2016 restored the status quo in the recognition of foreign maritime liens in Australia (see our briefing http://www.hfw.com/Arrest-of-the-SAM-HAWK-October-2016) two Federal Court decisions in November 2016 bring the year towards a close with the Federal Court’s jurisdiction and application of the Admiralty Act being confirmed on established and predictable grounds.
In The Joint Provisional Liquidators of BJB Career Education Company Limited (In Provisional Liquidation) v Xu Zhendong1, the Court of First Instance considered the Hong Kong courts' common law powers to recognise and assist foreign courts and insolvency practitioners overseeing non-Hong Kong insolvency proceedings.
The questions considered by the court were:
The challenging commodity price environment will likely bring renewed focus on the rights and obligations that will be impacted if insolvency overtakes exploration and production companies. The British Columbia Supreme Court’s recent decision in Re: Walter Energy Canada Holdings, Inc. is a case in point. The case dealt squarely with the question of whether a mineral royalty “runs with the land” – a question that takes on significantly greater importance in the insolvency context.
In a previous post we discussed how the Court of Queen’s Bench of Alberta recently authorized a sale transaction after being satisfied with the appropriateness of a sales process that was undertaken prior to the issuance of the receivership order.
The insolvency of Hanjin Shipping (Hanjin), the world's seventh largest container line, is likely to have a significant impact throughout the maritime sector. In this briefing we provide an overview of some of the potential consequences of Hanjin's insolvency and which parties will be most affected by this development.
Background
In the recent unreported decision of Alberta Treasury Branches v. Northpine Energy Ltd., the Court of Queen’s Bench of Alberta authorized a disposition of a debtor’s assets by a receiver immediately upon appointment and without being forced to conduct a marketing process within the receivership proceedings.
On April 14, 2016, the priority of statutory trust protections afforded to subcontractors and suppliers under Alberta’s lien legislation was strengthened: the Supreme Court of Canada dismissed an appeal in Iona Contractors Ltd. v. Guarantee Company of North America, 2015 ABCA 240, thereby bolstering the priority of the trust even in the face of a bankrupt general contractor.
At first glance, it seems that cross-border insolvencies between the UK and EU are likely to become more time-consuming, complex and expensive post-Brexit. However, the situation may not be as dire as it first appears due to the existence of alternative legislation and the exemptions to the EU legislation. As with other areas of law, when it comes to insolvencies much will depend on what steps are taken to maintain the current arrangements with the EU or whether they fall away altogether.
Both the Bankruptcy and Insolvency Act (“BIA”)[1] and the Companies’ Creditors Arrangement Act[2] stay actions and remedies as against debtors.