Demetrios Yiokaris

Following a decision in CCAA proceedings, the parties made written submissions on costs.

The court approved an agreement to pay the Retirees' full indemnity legal fees from the Executive Plan fund.

The court declined to make a similar order for the United Steelworkers regarding the Salaried Plan.

The court made no order as to costs for the underlying motions, following conventional CCAA practice.

For the appeal, the Retirees and the USW were awarded partial indemnity costs fixed at $40,000, payable jointly and severally by Sun Indalex and the U.S. Trustee.

Indalex Limited, while under CCAA protection, obtained a super-priority charge for DIP financing and subsequently sold its assets.

The sale proceeds were insufficient to cover both the DIP lenders and the deficiencies in Indalex's underfunded pension plans.

The Court of Appeal held that a deemed trust under s. 57(4) of the Pension Benefits Act applied to the pension deficiencies and took priority over the DIP lenders' super-priority charge, as no explicit finding of federal paramountcy had been made.

Furthermore, the Court found that Indalex breached its fiduciary duties as the pension plans' administrator by failing to protect the beneficiaries' interests during the CCAA proceedings, justifying a constructive trust over the reserve fund.