The appellants, 36 former employees and shareholders of NexJ Systems Inc., appealed an application judge's order approving a plan of arrangement under the Canada Business Corporations Act.
The plan compelled them to sell their shares in NexJ Systems Inc. and NexJ Health Holdings Inc. to N. Harris Computer Corporation, and included a broad release of claims.
The appellants argued the plan was not fair or reasonable, breached prior agreements, denied procedural fairness by releasing claims without trial, and that the judge exceeded jurisdiction by including shares of a related company (NexJ Health).
The Court of Appeal dismissed the appeal, finding no procedural unfairness, upholding the application judge's interpretation of the 2011 agreements, confirming jurisdiction over the related company's shares as necessary for the financing, and affirming the valid business purpose of the plan.
