Innovation Credit Union v. Bank of Montreal [2009] S.J. No. 147; 2009 SKCA 35, on appeal from 2007 SKQB 471

October 1991:     Saskatchewan farmer James Buist (“Debtor”) granted a general security agreement to Innovation Credit Union (“CU”). The general security agreement was not perfected under the Saskatchewan Personal Property Security Act (“PPSA”) by registration.

The extraordinary turmoil in the financial markets in recent times has caused many major economies, including the Canadian economy, to enter into a recessionary period. With the financial sector still trying to cope with the shocks of 2007 and 2008, prospects for a full Canadian economic recovery in the near future appear uncertain. Recent decisions by well-established Canadian companies such as Nortel Networks and Masonite International Corporation (a Kohlberg Kravis Roberts & Co.

A recent decision of the British Columbia Court of Appeal has rationalized the approach to be taken by Courts in considering appeals in CCAA cases.

The Alberta Court of Queen's Bench recently permitted a debtor to establish a "hardship" fund to pay obligations incurred prior to the debtor's CCAA filing to local suppliers operating in the debtor’s community.

Retention of key employees is a primary concern of any company that is seeking to survive a restructuring process as a viable operating business. The question is how to ensure that employee retention payments fairly balance the goal of retaining employees who are key to the restructuring against the financial impact on other stakeholders of the implementation of such a program. Beyond that, in the case of a cross-border restructuring, one must be aware of the difference between Canadian and US law on the issue of employee retention.  

Radius Credit Union Limited v. Royal Bank of Canada [2009] S.J. No. 148, 2009 SKCA 36, on appeal from
2007 SKQB 472

1992: Farmer Wayne Hingtgen (“Debtor”) granted a general security agreement to Radius
Credit Union Limited (“CU”) granting a security interest on all his present and after
acquired assets.

Mercedes Benz Financial v. Ivica Kovacevic (Ont. SCJ)

February 26, 2009: Finding of contempt of Court: [2009] O.J. No. 783

March 3, 2009: Sentencing hearing and order of five days in jail [2009] O.J. No. 888

Mr. Kovacevic (the “Debtor”) entered into a conditional sale contract to finance a Mercedes vehicle with

Mercedes Benz Financial. After seven of forty-eight payments, he defaulted in payment. He refused to pay or return the vehicle.

Canada’s insolvency and restructuring regime consists primarily of two separate statutes that have been substantially amended in recent years to align their restructuring provisions. Despite some similarities with its U.S. counterpart, the amended Canadian regime remains distinct.

AbitibiBowater

The Supreme Court of Canada recently released its decision in Saulnier v. Royal Bank of Canada1 ("Saulnier"), an important case involving fishing licences in the context of a secured lending transaction and an assignment in bankruptcy. This case contains what we believe is significant commentary on classifying certain governmental licences as "property" under the Bankruptcy and Insolvency Act (Canada) (the "BIA") and "personal property" under the Personal Property Security Act (Nova Scotia) (the "Nova Scotia PPSA").