In Royal Bank of Canada v. Casselman, three motions were brought before the Court. First, a continuation of a motion for approval and directions brought by the receiver. Second, a motion to allow counsel for the debtor to withdraw as lawyer of record. Third, a motion by the Sexton Group Ltd.
The Ontario Court of Appeal released its much anticipated decision on the appeals taken from the trial decision of Justice McEwen in Trillium Motor World Ltd. v. Cassels Brock & Blackwell LLP et al.
In the recent unreported decision, Bank of Nova Scotia et al v. Virginia Hills Oil Corp. et al, File No. 1701-02184, the Alberta Court of Queen’s Bench held that not all municipal property tax claims are priority secured claims in an insolvency.
Sixth Circuit Determines that an Absolute Assignment of Rents Perfected Under Michigan State Law Takes Property out of a Bankruptcy Estate (In Re Town Center Flats, LLC, Case No. 16-1812 — Decided May 2, 2017)
On April 24, 2017, the Alberta Court of Appeal issued a decision in Orphan Well Association v Grant Thornton Limited, 2017 ABCA 124. The decision is arguably the past year’s most hotly anticipated and discussed decision in Alberta, despite involving bankruptcy proceedings of a relatively small junior oil and gas company. The Court of Appeal, in a 2-1 split, upheld the trial judge’s decision that a receiver can disclaim or renounce uneconomic assets that are subject to costly environmental liabilities.
The Court of Appeal of Ontario found in Toronto-Dominion Bank v. Konga that the interpretation of a guarantee is a question of mixed fact and law, entitled to deference on appeal. Further, for a guarantor to obtain a discharge from the guarantee, he must establish that the bank's demand caused the debtor's default.
On March 30, the Third Circuit Court of Appeals filed an opinion regarding whether the filing of a mechanic’s lien after the commencement of a bankruptcy case violates the automatic stay. Given the frequent involvement of many companies in Delaware bankruptcy cases, you should be aware of the Third Circuit’s ruling.
The Lightstream decision confirms that Canadian courts have the jurisdiction under the CCAA to both: (i) incorporate and apply the oppression remedy; and (ii) where appropriate, when oppressive conduct has occurred, grant an order requiring a corporation to issue additional securities. However, such jurisdiction is limited and defined by the scheme and purpose of the CCAA.
In Re Lightstream Resources Ltd, 2016 ABQB 665 (Lightstream), the Court of Queen’s Bench of Alberta (Court) confirmed that it had jurisdiction to remedy oppressive conduct while a business is restructuring under the Companies’ Creditors Arrangement Act (CCAA). The decision also provides insight as to when a court might exercise its equitable jurisdiction to remedy oppressive conduct in a CCAA proceeding.
Background
Seyfarth Synopsis: A bankruptcy court overseeing an employer’s Chapter 11 bankruptcy proceeding allowed the employer to pay certain unsecured creditors before paying Worker Adjustment And Retraining Notification Act (“WARN”) creditors – workers who had sued the company – monies owed pursuant to a judgment, even though the bulk of the WARN monies owed were for back wages that hold priority over other unsecured claims under the Bankruptcy Code.