Trust claims against a borrower’s assets are something that no secured creditor wants to be confronted with. Such claims are often unexpected because they are, for the most part, undetectable. They lurk in the shadows, out of the reach of traditional due diligence measures and PPSA searches. As a result, even the most prudent of creditors can sometimes find themselves facing these undocumented and unquantifiable claims.

A guarantor can be made bankrupt where the terms of the guarantee create a debt obligation.

COVID-19 has had an unimaginable impact on the corporate world. The assumptions on which parties approached corporate transactions like Joint Ventures (JV) have often been blown off course. Businesses that are party to JVs must monitor not just themselves but the condition of their JV partner and the impact that they may have on the JV. There is no 'off the shelf' Joint Venture Agreement (JVA). Analysing the legal and practical rights and constraints in each JV is therefore essential.

36153 Ryan Glenn Ziegler v. Her Majesty the Queen (Criminal law – Dangerous offender)

The court has held that a statutory demand is valid despite the high default interest rate on an underlying loan.

Two priority issues arise between creditors of a common debtor:

doing business in Canada 2 | doing business in Canada Canada is one of the world’s premier locations for business investment. Boasting an exceptional wealth of natural resources, a sound financial system and world-class infrastructure, Canada is known for innovation in a wide range of sectors. And with generous research and development incentives, low corporate tax rates, and easy access to major U.S. markets, Canada is a top destination for foreign companies seeking a foothold in North America.

Lenders should be aware that a broad definition of “wages” owing to employees of a borrower/customer in bankruptcy or receivership can take priority over what a lender might otherwise believe is its “first ranking charge” against the borrower.

In Callidus Capital Corporation v. Her Majesty the Queen,[1] the Supreme Court of Canada overturned a troubling 2017 decision of the Federal Court of Appeal. The Supreme Court held unanimously that the bankruptcy of a debtor extinguishes the deemed trust for unremitted GST and HST created in favour of the Crown (“CRA”) by section 222 of the Excise Tax Act (“ETA”).

Restrictive covenant - if in doubt, lender should be notified; the costs risk of insolvency proceedings; interim payments; service of claim form; Wragge & Co's banking and finance experts bring you the latest on the cases and issues affecting the lending industry.

Restrictive covenant - if in doubt, lender should be notified