In Caetano v Quality Meat Packers, 2017 ONSC 1199, Justice Belobaba of the Ontario Superior Court recently had opportunity to consider whether two representative proceedings commenced on behalf of two separate groups of employees against an insolvent employer ought to be struck because, despite the actions having been commenced within the applicable two year limitation period, the plaintiffs in those two actions had failed to obtain the necessary representation orders within the two year period.
When you are focused on the day-to-day running of a business, it can be all too easy to miss the warning signs that you may be at risk of insolvency. Often, the signs might be interpreted as a “blip” or a “minor issue” paired with the assumption that the company can trade out of it. In this article, Stephen Young identifies some of the key warning signs that directors should be aware of.
A set of new insolvency rules are coming into force, as of April 6 2017, as Stephen Young explains in the following bulletin. In short, the previous insolvency rules that have been in force since 1986 no longer apply and instead a whole new set of rules now must be used.
The new Insolvency (England & Wales) 2016 rules will apply to all cases, both existing and new.
In short, the main changes are as follows:
1. All of the Parts and Numbering of the old rules have been completely changed so each type of insolvency has its own new Part.
The Court of Appeal has recently overturned the commonly held belief that a validation order would normally be made if the disposition made by a company subject to a winding up petition was done so in good faith and in the ordinary course of business at a time when the parties were unaware of the existence of the petition.
1. The starting point
Section 127 Insolvency Act 1986 provides:
RBS announced last month that SME customers will automatically be entitled to a refund of the fees that they were charged whilst being managed by the Bank’s Global Restructuring Group (GRG) between 2008 and 2013 following a review by the FCA.
This offer follows on from the payments RBS has made in recent years for the mis-selling of PPI and interest rate swap products which has resulted in £1.8 billion of redress costs.
This article examines possible consequences for SMEs that were in GRG during the relevant period which now are, or have been, in an insolvency procedure.
In Essar Steel Algoma Inc. (Re), Justice David Brown of the Ontario Court of Appeal held that the ambit of orders “made under” the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36 (the “CCAA”), and thus requiring leave to be appealed, is broad. Though concluding that the appellant in this case required leave to appeal, he nonetheless ordered the leave motion be expedited.
In his decision in Global Royalties Limited v. Brook, Chief Justice Strathy of the Ontario Court of Appeal explained that the Bankruptcy and Insolvency Act (“BIA”) does not provide a bankrupt with a right to appeal an order lifting a stay of proceedings against him. Despite there being a multi-party bankruptcy, he rejected the submission that “the order or decision is likely to affect other cases of a similar nature in the bankruptcy proceedings”.
Introduction
In Walchuk Estate v. Houghton, the Ontario Court of Appeal dismissed a motion to quash an appeal on the basis that the lower court’s adjournment of a contempt motion was a final order. The decision also provides guidance, yet again, on the proper test for distinguishing between final and interlocutory orders.
Background
The media have been paying considerable attention to the current financial distress of the energy industry in Alberta, focusing primarily on the impact a company’s financial condition can have on its stakeholders, including its employees, shareholders and creditors. But there is another group that is also being affected: counterparties to commercial arrangements with insolvent companies. Increasingly, financially strong companies are having to deal with insolvent joint venture partners, financially distressed operators, and bankrupt lessees.