Occupational Health and Safety Act charges could proceed against an insolvent company even though it had obtained protection from its creditors under the Companies’ Creditors Arrangement Act (“CCAA”), an Ontario judge has decided.
Terrace Bay Pulp Inc. was charged with offences under the Ontario Occupational Health and Safety Act in relation to two separate incidents, one in which a worker was injured in the company’s wood-handling department, and one in which a worker died after an explosion blew part of the roof off of a mill.
The Supreme Court of Canada overturned the Ontario Court of Appeal today in what is one of the most highly-anticipated cases for the pension and insolvency bars pending before the courts. In Indalex (Re) 2013 SCC 6, the court provided clarity regarding some key questions relating to the governance of an employer-administered pension plan during a proceeding under the Companies’ Creditors Arrangement Act (CCAA). The judges split on some of the issues, but here is our brief round-up:
Introduction
In the recent decision of the Ontario Superior Court of Justice (the “Ontario Court”) inRe Hartford Computer Hardware Inc.1 (“Re Hartford”), the Ontario Court held that the public policy exemption in foreign recognition proceedings under the Companies’ Creditors Arrangement Act (the “CCAA”) should be interpreted narrowly.
Introduction
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
Bill 68 – An Act to promote Ontario as open for business by amending or repealing
certain Acts (the “Open for Business Act”)1 received Royal Assent on October 25,
2010. It is an omnibus Act which contains more than 100 amendments to existing
legislation spread out across 10 ministries.
On April 7, 2011, in Indalex Limited (Re), 2011 ONCA 265 (Re Indalex), the Ontario Court of Appeal (the Court) held that in certain circumstances a pension plan wind-up deficit should be paid in priority to claims of secured creditors, including amounts outstanding under a court-approved debtor-in-possession facility (the DIP Facility).
Section 38 provides a mechanism by which a creditor can take the place of the trustee in any proceeding where the trustee refuses or fails to act. Essentially, the creditor stands in the place of the trustee and, if successful in the proceeding, is entitled to keep all proceeds, except those that exceed the total of the creditor’s claim and the creditor’s costs of the proceeding. Any surplus proceeds received by the creditor are the property of the bankrupt’s estate.