As we reported in our March 2017 bulletin "And then there were none; Ontario has repealed the Bulk Sales Act", the Bulk Sales Act (Ontario) (the “BSA”) was repealed as a result of the coming into force of Schedule 3 of Bill 27, the Burden Reduction Act, 2017.

When a lender makes an interest bearing loan to a borrower for a fixed term, the contract may provide that the borrower cannot repay the principal sum before maturity. This is often referred to as a “no call” provision. The intent of this provision is to protect the lender’s expected return on its investment during the term of the contract. Otherwise, the lender could be faced with the loss of interest payments that the borrower would have otherwise paid to the lender.

On November 16, 2016, the Ontario Ministry of Government and Consumer Services (“MGCS”) posted the Fall 2016 report (the “Report”)[1] of the Business Law Advisory Council (the ”Council”), which was formed by the MGCS in March 2016 to put forward recommendations for modernizing Ontario’s corporate and commercial statutes.

The tension between a trustee seeking to facilitate a proposal for the benefit of all creditors and a single creditor being forced to release its rights for the “greater good” was front and center in a recent case before the Supreme Court of British Columbia.

New insolvency fees and deposits introduced on 21 July 2016

From 21 July 2016, insolvency fees for bankruptcy and company insolvency are set to change. This is the outcome from the funding review the Insolvency Service has undertaken with the Department for Business, Innovation and Skills and HM Treasury and is to come into force in the shape of The Insolvency Proceedings (Fees) Order 2016 (SI 2016/692).

A recent decision of the Ontario Superior Court of Justice serves as a reminder for secured lenders of the importance of perfecting a security interest by registration. Absent perfection, collateral is at risk of seizure by judgment creditors of the borrower. Perfection, however, insures that a creditor has a priority interest in collateral over any subsequent judgment creditor. The decision also shows the importance to vendors of conducting continuous diligence on customers when credit is being extended on a regular basis.

Backround

You will be pleased, I hope, to hear that in this blog I shall largely be steering the referendum itself a wide berth; this is not because the prospect of Brexit would not impact greatly on insolvency law and practice (it undoubtedly would) but because I have already blogged on that topic in March and issued press releases on it in so far as it affects business decision making under the R3 banner, but mainly

On October 7, 2015, the British Columbia Court of Appeal reversed the Supreme Court of British Columbia's decision in Barafield Realty Ltd. v. Just Energy (B.C.) Limited Partnership ["Barafield Realty"].¹ In July of 2014, we wrote the attached bulletin http://www.mcmillan.ca/Assigning-contracts-in-Canadian-insolvency-proceedings on the lower court decision.

This blogpost was first published as an edited article in Business Magazine’s June 2016 edition (available here).

Directors at risk in the twilight zone

As discussed in our May 2016 bulletin, New Rules for Asset Sales by Insolvent Producers (at least for now), the decision of the Court of Queen's Bench of Alberta in Re Redwater Energy Corporation, 2016 ABQB 278 ("Redwater") determined that provisions of the provincial legislation governing the actions of licensees of oil and gas assets did not apply to receivers and trustees in bankruptcy of insolvent companies, given the paramountcy of the Bank