Individuals who serve as directors or offices of public companies in Canada face an increasing amount of shareholder litigation and a complex web of legal and regulatory provisions that must be managed, navigated and adhered to. The challenge to directors only increases when the company is insolvent, on the eve of insolvency or otherwise in some form of financial distress. If the insolvency is driven by a liquidity crisis the company may be hard-pressed to maintain day-to-day operations and preserve going concern value for stakeholder groups. Alternatively, if the pr
In a changing economy, companies are constantly facing new challenges, and none are immune to insolvent suppliers or clients.
It is therefore crucial to be able to identify the early warning signs of a company's insolvency and to be aware of the issues that can arise when a client or a supplier becomes insolvent.
When Insolvency Looms on the Horizon
The media have been paying considerable attention to the current financial distress of the energy industry in Alberta, focusing primarily on the impact a company’s financial condition can have on its stakeholders, including its employees, shareholders and creditors. But there is another group that is also being affected: counterparties to commercial arrangements with insolvent companies. Increasingly, financially strong companies are having to deal with insolvent joint venture partners, financially distressed operators, and bankrupt lessees.
Hello All,
Topics covered by the Court of Appeal this week in its civil decisions included franchise law (duty of disclosure), employment law (WSIB and wrongful dismissal of dependent contractors), insolvency (statutory privilege of documents), debtor-creditor (capacity to execute guarantees), MVA (liability of automobile lessors), family law (property claims of unmarried common law spouses), contracts (interpretation and specific performance), and motions to strike for no reasonable cause of action (a claim by a lawyer against the Law Society and a securities class action).
In Wong v. Luu, the British Columbia Court of Appeal upheld an order requiring the production of a redacted trust ledger to the bankruptcy trustees for Luu Hung Viet Derrick (“Luu”) on the grounds that the trust ledger was not presumptively privileged and that production would not violate the bankrupt’s right to communicate in confidence with his lawyers.
In Aventura2, a recent decision of the Ontario Superior Court of Justice (Commercial List) (the “Court”), the Honourable Justice Penny confirmed that a bankruptcy trustee does not have the authority, pursuant to section 30(1)(k) of the Bankruptcy and Insolvency Act (the “BIA”), to disclaim a lease on behalf of a bankrupt landlord. Rather, a trustee’s authority to disclaim a lease is limited to situations where the bankrupt is the tenant.
PENSION ADMINISTRATION
York (Police Services Board) v. York Regional Police Association, 2015 CanLII 62103 (ON LA)
Hello again for another week,
On November 14, 2015, the Supreme Court of Canada rendered three decisions on the application of the the Bankruptcy and Insolvency Act, RSC 1985, c. B-3 (BIA) and its interaction with certain provincial statutes.
OVERVIEW OF THE FACTS
Le 14 novembre 2015, la Cour suprême du Canada a rendu trois arrêts portant sur l’application de la Loi sur la faillite et l'insolvabilité, L.R.C. 1985, c. B-3 (LFI) et son interaction avec certaines lois provinciales.
APERÇU DES FAITS