This is the second instalment in a series on the US cross-border insolvency statute, Chapter 15 of the Bankruptcy Code, which took effect 11 years ago (for further details please see "Chapter 15 at 11: Bankruptcy Code's cross-border insolvency law approaches 11th anniversary").
The challenging commodity price environment will likely bring renewed focus on the rights and obligations that will be impacted if insolvency overtakes exploration and production companies. The British Columbia Supreme Court’s recent decision in Re: Walter Energy Canada Holdings, Inc. is a case in point. The case dealt squarely with the question of whether a mineral royalty “runs with the land” – a question that takes on significantly greater importance in the insolvency context.
In a previous post we discussed how the Court of Queen’s Bench of Alberta recently authorized a sale transaction after being satisfied with the appropriateness of a sales process that was undertaken prior to the issuance of the receivership order.
Introduction
Chapter 15 of the Bankruptcy Code, which deals with cross-border insolvency cases, took effect nearly 11 years ago.(1) Congress enacted Chapter 15 in 2005 to replace Bankruptcy Code Section 304, which previously addressed transnational insolvencies.(2) Chapter 15 largely incorporates the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Cross-Border Insolvency, which was promulgated in May 1997. The Model Law is designed:
In the recent unreported decision of Alberta Treasury Branches v. Northpine Energy Ltd., the Court of Queen’s Bench of Alberta authorized a disposition of a debtor’s assets by a receiver immediately upon appointment and without being forced to conduct a marketing process within the receivership proceedings.
On April 14, 2016, the priority of statutory trust protections afforded to subcontractors and suppliers under Alberta’s lien legislation was strengthened: the Supreme Court of Canada dismissed an appeal in Iona Contractors Ltd. v. Guarantee Company of North America, 2015 ABCA 240, thereby bolstering the priority of the trust even in the face of a bankrupt general contractor.
Both the Bankruptcy and Insolvency Act (“BIA”)[1] and the Companies’ Creditors Arrangement Act[2] stay actions and remedies as against debtors.
Section 11.4 of the CCAA requires that persons identified as critical suppliers to a debtor company continue to provide goods and services on terms and conditions with the existing supply relationship.
Introduction
The Supreme Court will consider these key questions next term in Czyzewski v Jevic Holding Corp:(1)
The long-running conflict between insolvency professionals and the Alberta Energy Regulator (AER) that was (temporarily) clarified by the Court of Queen’s Bench of Alberta decision in Redwater Energy Corp. was previously analyzed in a blog post