The Alberta Court of Queen's Bench recently permitted a debtor to establish a "hardship" fund to pay obligations incurred prior to the debtor's CCAA filing to local suppliers operating in the debtor’s community.

As previously reported, the International Insolvency Institute will hold its Ninth Annual International Insolvency Conference at Columbia University in New York on June 18 and 19, 2009. This Conference is likely to be the finest international insolvency Conference of the year and has an exceptionally talented and prominent faculty that will address today’s critical international insolvency issues and developments. Among the highlights of the Conference are the following:

On January 13, 2009, in Fisk Ventures, LLC v. Segal, the Court of Chancery of Delaware considered the petition by an investor to have Genetrix, LLC dissolved because it was no longer “reasonably practicable” to continue to operate the company when the company had no operating revenue, no prospects of equity or debt infusion, a deadlocked board of directors and an operating agreement that gave no means of navigating around the deadlock. The court found in favor of the investor and concluded that judicial dissolution was the best and only option for the members in the company.

AbitibiBowater

As the pace of restructuring activity in Canada continues to accelerate (see the partial listing below), international creditors should be aware that there are credit risks in doing business with a company that is restructuring in either of Canada's two restructuring systems. (These are, briefly, the Bankruptcy and Insolvency Act which is generally used for small to medium sized restructurings and the Companies Creditors' Arrangement Act which is generally used for large cases and resembles proceedings under Chapter 11 of the United States Bankruptcy Code).

Canadian Superior

On December 10, 2008, Bernard Madoff confessed to his two sons that he had been running what amounted to a massive Ponzi scheme on the scale of approximately $50 billion and that he could no longer sustain it due to, among other things, substantial redemption requests. That night, his sons alerted authorities.  

On January 14, 2009, Nortel Networks Corporation obtained protection from its creditors under theCompanies' Creditors Arrangement Act. From a historical perspective, it represents a Canadian icon's fall from grace. It was once an industry heavyweight - at its height its market cap was $250 billion and accounted for two thirds of the total value of the Toronto Stock Exchange. As North America's largest maker of telephone equipment (and now into its 113th year), its problems were compounded by the global financial crisis and North American recession as well as by global competition.

In the insurance industry, title insurance is known as a “long-tailed” liability risk, which means that it is common for claims to be made many years after policies are issued. For this reason, owners of real estate, their lenders and their counsel have long scrutinized the financial health of title insurance underwriters.

Effective March 31, 2009 (not April 1), Georgia lien law is officially set to undergo a series of substantial changes, as a result of Governor Sonny Purdue signing Senate Bill 374 into law. These changes are significant and exist throughout the lien statutes. Many of the revisions require new, very specific procedures and forms that must be precisely followed in order to prevent waiving lien rights. Although the new lien law is not technically retroactive, it appears that several of the requirements could pertain to liens filed prior to March 31.