The decision of the British Columbia Superior Court in Re Ted Leroy Trucking Ltd. was a result of an application for directions with respect to what amounts are properly covered by the Wage Earner Protection Program Act, S.C. 2005, c. 47 (the “WEPPA”), and the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3 (the “BIA”).

An Ontario Court recently confirmed that an execution creditor does not have priority over the unsecured creditors of a debtor upon the insolvency of the debtor even if the judgment creditor is then holding funds of the debtor which it has garnisheed.

In February 2008, the Superior Court of Justice – Ontario granted Cotton Ginny Inc., CG Operations Limited ("H/O"), CG Operations I Limited and CG Operations II Limited, protection under the Companies’ Creditors Arrangement Act.

In Mendlowitz & Associates Inc. v. Chiang, an Order was granted in 2006 compelling the bankrupt and others to attend for an examination by the trustee under section 163(1) of the Bankruptcy and Insolvency Act (Canada). In 2008, the trustee applied under the same section to examine the bankrupt and others again.

Section 163(1) of the BIA provides:

When a company winds up, begins restructuring proceedings or goes bankrupt, a debtor or creditor may be able to cancel out the amount payable to the other party by using the remedy of “set‐off”. Set‐off involves the cancelling of crossliabilities between two parties who owe each other money. It is a valuable tool that can increase a creditor’s percentage of recovery and decrease the debt burden of a debtor.

Types of Set‐off: Contractual, Legal or Equitable

In Rieger Printing Ink Co, 2009 WL 477541 (Ont S.C.J. [Commercial]), the Ontario Superior Court of Justice dealt with a party's right to protection against selfincrimination in relation to an examination held under section 163 of the Bankruptcy and Insolvency Act, R.S.C., 1985 c. B-3 ("BIA").

In Re ScoZinc Ltd., 2009 NSSC 136 the monitor appointed under the Companies’ Creditors Arrangement Act (“CCAA”) brought a motion for directions on whether it had the authority to allow the revision of a claim after the claim’s bar date, but before the date set for the monitor to complete its assessment of claims.

The U.S. doctrine of equitable subordination (as now set out in the U.S. Bankruptcy Code) allows a U.S. court to subordinate all or part of a creditor's claim to the claims of other creditors if the creditor has engaged in inequitable conduct that gives the creditor an unfair advantage or is injurious to the other creditors. Will the Canadian courts apply the doctrine?

Pursuant to an Order in Council dated July 4, 2008, July 7, 2008 was established as the date that certain of the provisions of S.C. 2005, c. 47 (the "Insolvency Reform Act 2005") and S.C. 2007, c. 36 (the "Insolvency Reform Act 2007") came into force. The Wage Earner Protection Program Act (the "WEPPA") as well as certain of the amendments to the Bankruptcy and Insolvency Act (the "BIA") made by the Insolvency Reform Act 2005 and the Insolvency Reform Act 2007 are, as a result, now in force.

An Ontario Court has provided guidance on determining a person's centre of main interests (COMI) for the purposes of the UNCITRAL Model Law on Cross-Border Insolvency (as implemented in New Zealand, in the Insolvency (Cross Border) Act 2006, and in Canada).

Under the Model Law, a "foreign main proceeding" is defined as a proceeding in the jurisdiction where the debtor has its COMI, with a presumption that a debtor company's COMI is where its registered office is.

Whether—and in what circumstances—a debtor should pay creditors a make-whole premium continues to be litigated in bankruptcy courts. Last week, as reported by Bloomberg, Judge Dorsey (Delaware) ruled that the debtor – Mallinckrodt Plc – did not need to pay a make whole premium to first lien lenders in order to reinstate such obligations under the debtor’s chapter 11 plan.