La Cour du Banc de la Reine de l’Alberta (la « Cour ») a clarifié la façon dont seront traitées les demandes en cas d’abus dans le cadre de procédures en vertu de la Loi sur les arrangements avec les créanciers des compagnies (la « LACC »). Dans sa décision récente concernant l’affaire Lightstream Resources Ltd.

The Lightstream decision confirms that Canadian courts have the jurisdiction under the CCAA to both: (i) incorporate and apply the oppression remedy; and (ii) where appropriate, when oppressive conduct has occurred, grant an order requiring a corporation to issue additional securities. However, such jurisdiction is limited and defined by the scheme and purpose of the CCAA.

​In Re Lightstream Resources Ltd, 2016 ABQB 665 (Lightstream), the Court of Queen’s Bench of Alberta (Court) confirmed that it had jurisdiction to remedy oppressive conduct while a business is restructuring under the Companies’ Creditors Arrangement Act (CCAA). The decision also provides insight as to when a court might exercise its equitable jurisdiction to remedy oppressive conduct in a CCAA proceeding.

Background

Dans l’arrêt Arrangement relatif à Métaux Kitco inc. 2017 QCCA 268 rendu le 20 février dernier, la Cour d’appel du Québec a confirmé la décision de la Cour supérieure interdisant l’Agence du revenu du Québec (« ARQ ») de compenser des crédits et des remboursements de taxes sur les intrants (« CTI/RTI ») réclamés prétendument illégalement par Métaux Kitco inc. (« Kitco ») avant le dépôt d’un avis d’intention avec des CTI/RTI engendrés après le dépôt d’un avis d’intention.

The Alberta Court of Queen’s Bench (Court) has provided clarity on how oppression claims will be adjudicated in the context of the Companies’ Creditors Arrangement Act (CCAA). In the recent decision in Lightstream Resources Ltd. (Re), the Court confirmed that it has jurisdiction to hear oppression claims, but held that the exercise of this discretion is limited to appropriate circumstances.

Both of Canada’s primary insolvency statutes, the Bankruptcy and Insolvency Act (“BIA”) and the Companies’ Creditors Arrangement Act (“CCAA”) provide for an automatic stay of all legal proceedings when an insolvent debtor files for or seeks insolvency protection. The purpose of the stay is to provide breathing space to a debtor attempting to restructure its business so as to avoid “death by a thousand cuts” and also to ensure similarly situated creditors are treated equally.

In a previous post we discussed how the Court of Queen’s Bench of Alberta recently authorized a sale transaction after being satisfied with the appropriateness of a sales process that was undertaken prior to the issuance of the receivership order.

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.

In lengthy insolvency proceedings, interest accrued on existing claims during the “post-filing” period can represent a substantial portion of the debtor’s estate.

In a November 20,2013 decision in the Companies Creditors’ Arrangement Act (the “CCAA”) proceedings of Aveos Fleet Performance Inc. and Aero Technical US, Inc.