Courts Now Have More Discretion Regarding Plans of Arrangement Under Alberta's Amended Business Corporations Act
One of the main benefits to a purchaser who buys oil and gas assets in a proceeding under the Companies' Creditors Arrangement Act or a receivership is the near-absolute quieting of title via a "vesting order." In Manitok Energy Inc (Re), the Alberta Court of Appeal confirmed the importance and effect of Sale App
Earlier this year, we highlighted the US Supreme Court’s grant of certiorari in Siegel v. Fitzgerald (In re Circuit City Stores, Inc.) to determine whether a 2017 statute that increased Chapter 11 quarterly fees was constitutional. The Supreme Court has spoken and deemed the increase unconstitutional under the Bankruptcy Clause, which requires that bankruptcy laws be uniform.
Stoneway was advised in its CBCA proceedings by a team including: Kevin Zych, Michael S. Shakra and Joshua Foster (Restructuring & Insolvency); Richard Swan (Litigation); Kristopher Hanc (Capital Markets); Thomas Bauer and Philip Ward (Tax); and Preet K. Gill (Complex Legal Issues and Opinions).
Introduction
An insolvency moratorium first introduced during the COVID-19 pandemic applies to nearly all Russian legal entities, individuals, and sole entrepreneurs, and bans the commencement of insolvency proceedings against Russian obligors.
On March 25, 2022, the Alberta Court of Appeal issued its decision in PricewaterhouseCoopers Inc v Perpetual Energy Inc, 2022 ABCA 111. Briefly, the Court held that abandonment and reclamation obligations (ARO) of oil and gas assets operate to depress the value of those assets for the purposes of fraudulent preferences legislation, notwithstanding that they are not provable claims in bankruptcy. The Court also held that serial summary dismissal applications on different grounds are an abuse of process.
It begins with an awkward mouthful. Outside a bankruptcy brief, is “unimpairment” even a word? (No, per Merriam-Webster.) Inside Chapter 11, it’s much more: a trend.
Want to refinance your bonds cheaply? Are you an otherwise sound and solvent business, forced into bankruptcy by a massive fire (PG&E), persistent low commodity pricing (Ultra Petroleum), or a pandemic (Hertz, whose airport rental business was shuttered in 2020 by COVID-19)?
Or would you just prefer to boost your stock value by lowering your coupon?
The corporate attribution doctrine concerns the attribution of the actions of a corporation’s directing mind to the corporation itself. On March 10, 2022, in Ernst & Young Inc. v. Aquino [Aquino], the Court of Appeal released what it described as a decision of first impression in which the Court considered the doctrine in the bankruptcy and insolvency context.
This is how Tribune ends: not with a bang, but a whimper. The 12-year litigation saga, rooted in the spectacular failure of the media and sports conglomerate’s 2007 leveraged buyout, reached an end in late February with a curt “cert. denied” from the US Supreme Court.
Morgan Lewis was one of the firms that captained the defense for Tribune’s former shareholders. This post notes some lessons that we learned—and relearned.
Lesson One: Section 546(e)’s ‘New’ Safe Harbor
The US Supreme Court tends to hear a couple of bankruptcy cases per term. Most of these cases deal with interpreting provisions of the Bankruptcy Code. However, every few years or so, the Supreme Court decides a constitutional issue in bankruptcy. Some are agita-inducing (Northern Pipeline, Stern), some less so (Katz). The upcoming case is a little more nuanced, but could have major consequences.