A recent decision at the Ontario Superior Court of Justice (Commercial List) brought to the fore the role of fairness opinions in solvent arrangement transactions. In Re ChampionIron Mines Limited (Champion) the court approved the arrangement but deemed the fairness opinion inadmissible on the basis that it failed to disclose the reasons underlying its conclusion.
In Susi v. Bourke, 2014 O.J. No. 11
A Summary
In Susi v. Bourke, [2014] OJ No 11, the Ontario Superior Court of Justice held that when all of the directors of a corporation fail to comply with their fiduciary duties, none of them can seek a remedy for oppression.
On October 3, 2013, the Court of Appeal for Ontario issued two significant decisions1 on the interplay between provincial environmental remediation and federal insolvency orders. The cases are of interest to environmental and insolvency lawyers across Canada. They are equally of interest to taxpayers who foot remediation costs shifted through insolvency.
Background
An “Administration Charge” under the CCAA
The Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended (“CCAA”) permits a court having jurisdiction over proceedings for the restructuring of an insolvent company to make certain orders, to secure payment of the fees of certain officials involved in those proceedings, including the Monitor of the insolvent company appointed for the restructuring proceeding.
A surprising judgment re the “Administration Charge”
Punj Lloyd Ltd (PLL), the ultimate parent of Simon Carves Ltd (SCL), provided 'letters of support' (what would in North America be called 'comfort letters') indicating to the board of SCL that PLL would 'provide the necessary financial and business support to ensure that [SCL] continues as a going concern'. This is precisely what SCL did not do: it went into administration, leaving invoices unpaid and unsecured creditors largely out of luck.
Morris Kaiser’s trustee in bankruptcy, Soberman Inc., thought it smelled a rat: while claiming to be impecunious, Kaiser appeared to be living a life of ‘some means’, which included trips to casinos in the US. Kaiser claimed he was drawing advances on the credit card of a buddy, Cecil Bergman, but the trustee suspected the whole thing was a front to shield Kaiser’s assets from his creditors.
Irish Bank Resolution Corporation Act and Appointment of Special Liquidators
In the early hours of 7 February 2013, the Irish Bank Resolution Corporation Act 2013 (the “IBRC Act”) was passed. The IBRC Act provides for the Minister for Finance to make a “Special Liquidation Order” (“SLO”) winding up IBRC. As a result of the SLO:
European Commission Work Programme
This Briefing contains a general summary of developments and is not a complete or definitive statement of the law. It also updates the Briefing published in July 2012 on the Personal Insolvency Bill. Specific legal advice should be obtained where appropriate.