A recent chambers decision holding that gross overriding royalties (“GOR”) can be vested off in a reverse vesting order (“RVO”) is on its way up to the Court of Appeal of Alberta (the “ABCA”). The ABCA has granted leave to appeal Invico Diversified Income Limited Partnership v NewGrange Energy Inc, 2024 ABKB 214 (“Invico”).

The Chambers Decision

In the Endoceutics case[1], the Superior Court recently clarified the application of section 32 of the Companies’ Creditors Arrangement Act

In late May, the Supreme Court of Canada (the SCC) denied an application for leave to appeal a decision of the Court of Appeal of Alberta (the ABCA), which, in turn, had denied leave to appeal of the decision of the Court of King’s Bench of Alberta (the ABKB) in Re Mantle Materials Group, Ltd, 2023 ABKB 488 (Mantle KB).

Just over a year ago, the Alberta Court of King’s Bench (“ACKB”) decision in Qualex-Landmark Towers v 12-10 Capital Corp (“Qualex”)[1] extended the application of an environmental regulator’s priority entitlements in bankruptcy and insolvency to civ

The Saskatchewan Court of Appeal has confirmed that the Supreme Court of Canada’s decision in Orphan Well Association v. Grant Thornton Ltd., 2019 SCC 5 [Redwater], applies in Saskatchewan. The Court of Appeal also affirmed that orders made in failed proceedings in Alberta under the Companies’ Creditors Arrangement Act (CCCA) did not have effect in subsequent receivership proceedings in Saskatchewan.

Recent teachings of the Supreme Court of Canada court in Canada v Canada North Group Inc., 2021 SCC 30 [Canada North] had confirmed that the Companies’ Creditors Arrangement Act (‘CCAA’) courts could grant super-priority charges (e.g. interim financing, administration charge, or directors’ and officers’ charges) ranking in priority to s.

It has long been established that where the circumstances in which funds are advanced by a shareholder to the company in which they own shares is unclear, the court must consider the "surrounding circumstances" when determining how to characterize the advance. Historically, "surrounding circumstances" were understood to be the circumstances extant at the time the transaction was effected: (e.g., Ghassemvand v. Premium Weatherstripping Inc., 2017 BCCA 309 [Ghassemvand]).

The Eighth Circuit held that “avoidance actions [e.g., preferences, fraudulent transfers] can be sold as property of the [Chapter 7 debtor’s] estate.” In re Simply Essentials, LLC, 2023 WL 5341506, *1 (8th Cir. Aug. 21, 2023). On a direct appeal from the bankruptcy court, the court affirmed the bankruptcy court’s granting of the trustee’s motions to compromise and sell property under Bankruptcy Code §363(f). A creditor had objected, arguing unsuccessfully that “avoidance actions… are not part of the bankruptcy estate ….” Id.

On July 28, 2023, Judge Michael Kaplan of the Bankruptcy Court for the District of New Jersey issued an opinion granting motions to dismiss LTL Management LLC’s second chapter 11 case, finding that it was filed in bad faith due to a lack of imminent and immediate financial distress. See In re LTL Mgmt., LLC, No. 23-12825 (MBK), 2023 WL 4851759 (Bankr. D.N.J. July 28, 2023). Judge Kaplan’s decision follows the U.S. Court of Appeals for the Third Circuit’s dismissal of LTL’s first chapter 11 bankruptcy case in January 2023.

Over the past year, digital asset investors have become acutely aware of asset custody and counterparty credit risks due to the high-profile bankruptcies of Voyager, Celsius, BlockFi, and FTX. These investors have found that, at times, their assets may be stuck in a bankruptcy proceeding for years. However, these investors—now bankruptcy claim holders—have options for more immediate liquidity.