Alex MacFarlane

The appellants, representing unionized and non-unionized former employees of Nortel, appealed a decision dismissing their motions for directions to compel Nortel to pay severance, termination, and retirement benefits during its CCAA restructuring.

The appellants argued that the payments were protected under s. 11.3(a) of the CCAA as compensation for ongoing services, and that the CCAA stay could not override provincial Employment Standards Act obligations.

The Court of Appeal dismissed the appeals, holding that the payments were for past services and that the doctrine of federal paramountcy allowed the CCAA stay to suspend the immediate payment obligations under the provincial legislation to facilitate the restructuring.

The Royal Bank of Canada (RBC) appealed a decision regarding a priority dispute over a $4.5 million tax refund to an insolvent company.

RBC had a perfected security interest when an interim receiver was appointed under s. 47 of the BIA.

However, RBC failed to file a financing change statement after the debtor's name changed, making its interest unperfected by the time the debtor was assigned into bankruptcy.

The Court of Appeal dismissed the appeal, holding that an interim receiver is not a 'person who represents the creditors of the debtor' under s. 20(1)(b) of the PPSA.

Therefore, the relevant date for determining priority was the date of bankruptcy, at which point RBC's unperfected security interest was ineffective against the trustee in bankruptcy.

Following the dismissal of an appeal regarding a receiver's decision to permit a corporation in receivership to plead guilty in an American criminal trial, the respondents sought costs.

The appellants argued no costs should be awarded as the issues were novel and complex.

The Court of Appeal rejected this argument, finding the appeal involved a standard review of a Commercial List judge's discretion.

The Court awarded costs to the respondents on a partial indemnity basis, fixing the amounts at a fair and reasonable level rather than actual costs incurred, payable by Lord Black and Conrad Black Capital Corporation.

The receiver of Ravelston Corporation Limited obtained an order allowing it to attorn to the jurisdiction of a U.S. federal court and plead not guilty to criminal charges on behalf of the corporation.

A shareholder and creditor appealed the order, arguing it involved future rights under s. 193(a) of the Bankruptcy and Insolvency Act, or alternatively sought leave to appeal under s. 193(e).

The Court of Appeal quashed the appeal, finding the order did not involve future rights but merely directed how present rights should be exercised.

The court also refused leave to appeal, concluding the proposed appeal lacked prima facie merit as the supervising judge made no error in principle in exercising his discretion.