In the recent decision of Century Services Inc. v. Canada (Attorney General), 2010 SCC 60, the Supreme Court of Canada has, for the first time, interpreted key provisions of the Companies’ Creditors Arrangement Act (“CCAA”).

The judgment of the Court, which was pronounced December 16, 2010, overrules appellate authority from Ontario and British Columbia that previously conferred a priority for unremitted GST on the Crown in CCAA proceedings, and endorses the broad discretionary power of a CCAA court.

On 14 December 2009, the same day on which Nakheel, a Dubai World subsidiary, was due to make payment under its 2009 sukuk, the Government of Dubai announced that it had received support from the Government of Abu Dhabi and the UAE Central Bank and would pay the US$4.1 billion due. It also announced that it had secured funding of an additional US$5.9 billion to be used to meet “interest expenses and working capital [of Dubai World] through April 30, 2010 – conditioned on the company being successful in negotiating a standstill”.

The English Court of Appeal has recently decided that a corporation that held shares in a company remained a shareholder notwithstanding the shareholding company's dissolution.

BWE Estates Limited had two shareholders: an individual named David who held 75% of its shares and a company, Belvedere Limited, which held the remaining 25%. Although Belvedere was dissolved in 1996, it remained listed as a shareholder in BWE's share register.

Liquidators entitled to a fair fee

The New South Wales Court of Appeal recently handed down an important judgment on the remuneration of registered liquidators.

The New Zealand and UK Arbitration Acts generally require court proceedings to be stayed if the parties have agreed to resolve disputes through arbitration.

In a recent address to the Insolvency Lawyers Association, the new Chancellor of the High Court, Sir Geoffrey Vos, discussed briefly the effect of that statutory stay upon winding-up petitions.

In Capital + Merchant Finance Limited (in receivership) v Vision Securities Limited (in receivership) our Wellington commercial litigation team was successful in the Court of Appeal on a defendant's summary judgment application involving the interpretation of a subordination clause in a Security Trust Deed (Deed).

In Grant v Commissioner of Inland Revenue, the Court of Appeal took little time to uphold a High Court decision that a deed of company arrangement (DOCA) under Part 15A of the Companies Act 1993 was void.

At the creditors meeting, the DOCA had been approved by the majority of creditors in number. Nevertheless, this did not constitute 75% of creditors in value. Mr Grant, as chair of a creditors' meeting, purported to exercise a casting vote in favour of the DOCA in order for it to be approved. 

In our October 2010 insolvency legal update, we reviewed the case of South Canterbury Finance Ltd v Nielsen, where the Court found in favour of second mortgagee, SCF, on the interpretation of a deed of priority.  That case was appealed successfully to the Court of Appeal by the first mortgagee, ASB.  This update provides a brief review of the Court of Appeal's reasoning.

We reported on the first instance decision in this litigation last year (see here).  The New South Wales Court of Appeal recently delivered judgment on the liquidators' appeal.

The Court of Appeal has confirmed that the costs of complying with Financial Support Directions (“FSDs”) proposed to be issued to certain Nortel and Lehman companies by the Pensions Regulator (“TPR”) qualify as “super priority” administration expenses, payable in priority to unsecured creditors, floating charge holders and the administrators’ own fees.

The question