In this Update
- on April 24, 2017, the Alberta Court of Appeal affirmed the Alberta Court of Queen’s Bench’s decision in Redwater Energy Corporation (Re), 2016 ABQB 278 (Redwater)
- reasons for the Redwater decision
- the issues in Redwater raise various important policy concerns regarding land owners, the public at large and the oil and gas industry
- background and significant implications of Redwater
Introduction
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.
Summary: The Insolvency Rules 2016 will come into force on 6 April 2017. This article highlights some of the main areas of change.
The long awaited Insolvency Rules 2016 (the “2016 Rules”) were laid before Parliament on 25 October 2016, and will come into force on 6 April 2017. The Insolvency Rules 1986 (the “1986 Rules”) and all amending legislation will be repealed. The 2016 Rules aim to:
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.
Summary: On 8 September 2016 Mr Justice Snowden handed down his judgment in Glenn Maud v Aabar Block Sarl & others [2016] EWHC 2175 (Ch) in which he considered how the court should deal with a bankruptcy petition where the petitioning creditor may have an ulterior purpose for seeking a bankruptcy order.
A client who is building a large mixed use development called me yesterday with a dilemma. He had received a letter from a local equipment supplier, who was on the verge of bankruptcy because the sub-contractor who had engaged him had gone into administration after the hire period had come to an end. He was pleading with my client to help him recover some £20,000 of hire fees still owed to him.
Summary: Customers of a company in administration were entitled, as against a factor, to exercise equitable set-off in respect of entitlements to rebates that had arisen between the customers and the company notwithstanding the assignment of the customer’s debts to the factor.
Bibby Factors Northwest Ltd v HFD Ltd [2015] EWCA Civ 1908 (17 December 2015)
Background
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
Summary: The Public Administration and Constitutional Affairs Committee's findings in relation to Kids Company serve as a reminder of the risks of insolvency to large charities. The inherent weaknesses in the demand-led 'self-referral' operating model resulted in little to no reserves, and ultimately led to the trustees being required to file a petition to wind up the charity. Trustees of large charities must always be mindful of reserve levels.