In 2018, several insolvency cases were litigated that will be of interest to commercial lenders in restructuring and insolvency proceedings. This article summarizes the core issues of importance to lenders in each of these cases. Status updates on the cases reported in our 2017 roundup of key developments in Canadian insolvency case law are included at the end of this article.

May 25, 2018

PRIORITY OF HST DEEMED TRUSTS

Canada v.Toronto-Dominion Bank

The Ontario Court of Appeal (OCA) has closed the door on the application of equitable subordination in Companies’ Creditors Arrangement Act (CCAA) proceedings. In U.S. Steel Canada Inc.

On April 17, 2014, the Supreme Court of Canada denied leave to appeal to Nortel from the decision rendered by the Ontario Court of Appeal last October. For additional details and commentary on the decision of the Ontario Court of Appeal, please see our November 2013 Blakes Bulletin: Ontario Court of Appeal Applies AbitibiBowater Test in Concurrent Decisions.

The long-awaited and highly anticipated decision of the Supreme Court of Canada in the Indalex case was released today. The decision stems from an appeal of an Ontario Court of Appeal decision dealing with a priority dispute between a court-ordered debtor-in-possession (DIP) charge granted under the Companies’ Creditors Arrangement Act (Canada) (CCAA) and a deemed trust for a wind-up pension deficiency asserted under the Pension Benefits Act (Ontario)(PBA).