D.J. Miller

In an insolvency receivership involving Yorkdale leasehold interests, the court considered whether to approve a receiver-negotiated sublease entered without landlord consent and whether ancillary relief should issue.

Applying the contractual framework under the Head Lease and Commercial Tenancies Act, and considering insolvency discretion under the Bankruptcy and Insolvency Act, the court held the landlord had not unreasonably withheld consent.

The court further held that s. 84.1 of the BIA did not apply directly or by analogy to the proposed sublease structure.

On a broader stakeholder-balancing analysis, the court found unfairness in the process and insufficient commercial soundness to justify discretionary approval.

The motion to approve the new sublease was dismissed, and ancillary relief was not addressed.

In this CCAA proceeding, the court granted multiple orders sought by Hudson's Bay Company and related entities, including approval of lease assignment agreements with YM Inc. and Ivanhoe Cambridge, sealing of confidential bid information, extension of the stay of proceedings to October 31, 2025, and approval of the Monitor's reports and activities.

The court rejected requests for adjournment and conditional distributions, finding the lease monetization process was fair and transparent, and that the proposed transactions represent a positive development for stakeholders.

This endorsement grants an unopposed application by RioCan Real Estate Investment Trust and related entities for the appointment of FTI Consulting Canada Inc. as receiver over the assets of the RioCan-HBC joint venture entities.

The court reviews the legal test for appointing a receiver under the Bankruptcy and Insolvency Act and the Courts of Justice Act, referencing relevant case law and statutory factors.

The receivership is found to be just and convenient in light of the joint venture’s financial distress, the failure of restructuring efforts, and the need to preserve and maximize value for stakeholders.

The order authorizes the receiver to borrow up to $20 million and provides for allocation of costs and a mechanism for secured lenders to terminate the receivership as to their collateral.

The decision addresses motions regarding the appointment of representative counsel for current and former employees and retirees of Hudson’s Bay Company ULC and related entities in ongoing Companies’ Creditors Arrangement Act (CCAA) proceedings.

The Court declined to appoint any of the nominated law firms as representative counsel at this stage, instead appointing the Honourable Herman Wilton-Siegel as an independent third party to evaluate proposals and make a recommendation.

The Court also approved amendments to the Sale and Investment Solicitation Process (SISP) to remove the company’s art and artifact collection from the SISP and to appoint Heffel Gallery Limited to conduct a separate auction for the collection, subject to further court approval of procedures.

The reasons review the legal framework for appointing representative counsel and the importance of balancing stakeholder interests in complex insolvency proceedings.

The appellant, 2557904 Ontario Inc. (the stalking horse bidder), appealed a motion judge's order that dismissed the receiver's motion for an approval and vesting order (AVO) and instead approved the debtor's (1000093910 Ontario Inc.) motion to redeem a first mortgage.

The Court of Appeal found the motion judge erred by not ensuring 255 received compensation for costs thrown away and by granting provisional enforcement of the order after an appeal notice was filed.

The appeal was allowed in part, varying the order to require the debtor to pay $300,000 in compensation to 255 and setting aside the provisional execution.

The court also ordered that if the refinancing transaction does not close, the AVO for 255 will be granted.

The Court of Appeal heard motions in an appeal concerning the receivership of a debtor's property.

The appellant, a successful bidder, appealed two lower court orders that terminated its Stalking Horse Agreement and approved the debtor's refinancing transaction.

The motion judge referred several issues to a panel, including the appellant's standing and right to appeal, and whether the lower court erred in terminating the agreement and granting provisional enforcement.

The Court of Appeal continued the stay of provisional execution of the lower court orders, emphasizing the importance of maintaining the integrity of court-approved sale processes, especially given the absence of reasons from the motion judge for his initial decision.

The Body Shop Canada Limited (TBS Canada) sought various orders under the Bankruptcy and Insolvency Act (BIA) following its UK parent's unexpected insolvency and cessation of financial support, which left TBS Canada with significant debts and operational challenges.

The requested relief included expanding the stay of proceedings, granting an administration charge, approving an indemnity and priority charge for directors and officers, directing the production of company records, and extending the time to file a proposal.

The court granted all requested orders, emphasizing the unusual and urgent circumstances, the necessity of the relief for TBS Canada's continued operations and restructuring efforts, and the consent of key stakeholders.

The Foreign Representative of Diebold Nixdorf, Incorporated and its Canadian subsidiaries applied under the Companies’ Creditors Arrangement Act (CCAA) for recognition of U.S. Chapter 11 proceedings as foreign main proceedings and for recognition and enforcement of U.S. orders, including a super-priority debtor-in-possession (DIP) charge and a prepackaged plan of reorganization.

The court granted the application, finding the U.S. to be the centre of main interests (COMI) for the Canadian entities despite their registered offices being in Canada, due to integrated management, operations, and financial functions.

The court recognized the foreign orders, including the DIP charge, as consistent with CCAA principles and not contrary to public policy, and found no material prejudice to Canadian interests.

The request to dispense with the mandatory notice publication was denied.

This endorsement concerns a motion by Acerus Pharmaceuticals Corporation and its subsidiaries (the Applicants) under the Companies’ Creditors Arrangement Act (CCAA) for approval of a Subscription Agreement, a reverse vesting order (ARVO), releases for various parties, a sealing order, and an extension of the stay of proceedings.

The proposed transaction involves First Generation Capital (FGC), the majority shareholder and secured creditor, acquiring the Applicants' business via a credit bid and share transaction, with excluded assets and liabilities vested out to Residual Cos.

The court analyzed the necessity and fairness of the ARVO structure, the sales process, the benefit to creditors compared to bankruptcy, and the appropriateness of the releases, ultimately granting all requested relief.

Laurentian University brought a motion within its CCAA proceedings for a vesting order to transfer a portion of its property to neighbouring landowners.

The transfer was part of a settlement agreement to resolve a pre-existing encroachment dispute, with the neighbours agreeing to pay $20,000.

The court found it had jurisdiction to grant the vesting order under section 100 of the Courts of Justice Act, read in conjunction with the Conveyancing and Law of Property Act and the CCAA.

The court also confirmed that a vesting order does not constitute a conveyance that engages the subdivision control provisions of the Planning Act.

As the motion was unopposed and resolved outstanding litigation, the vesting order was granted.

The Court-appointed Monitor in the CCAA proceedings of Laurentian University brought an unopposed motion for approval of its reports, activities, and professional fees.

The Court applied the factors from Confectionately Yours and found the requested fees for the Monitor, EY FAAS, and the Monitor's counsel to be fair and reasonable, given the novel and complex nature of the proceedings.

The Court approved the fees, disbursements, and the Monitor's reports.

In the context of Laurentian University's CCAA proceedings, the moving party brought a motion seeking an order to direct the Monitor to engage in mediation regarding its appeal of a Claims Officer's decision.

The Claims Officer had upheld the Monitor's disallowance of the moving party's $9.8 million claim for loss of commercial value.

The court dismissed the motion, finding that the existing claims process provided an adequate mechanism for resolving the dispute through the pending appeal.

The court also noted that the request for mediation was made too late, as it was brought only after the Claims Officer had already determined the matter on its merits.

Laurentian University of Sudbury brought an unopposed motion for an order sanctioning its Plan of Compromise and Arrangement under the Companies' Creditors Arrangement Act.

The Plan had been approved by the requisite double majority of affected creditors.

The Superior Court of Justice found that the applicant strictly complied with all statutory requirements, no unauthorized steps were taken, and the Plan was fair and reasonable.

The Court also approved the third-party releases contained in the Plan, unsealed previously sealed exhibits, and extended the stay of proceedings to allow for the Plan's implementation.

Laurentian University brought an unopposed motion within its CCAA proceedings for an order extending the stay period to September 30, 2022, and an order approving a Pension Participation Agreement with the University of Sudbury.

The court found that the applicant had acted in good faith and with due diligence, justifying the stay extension.

The court also approved the pension agreement, finding it to be a fair and reasonable settlement that provided substantial benefits to stakeholders and was consistent with the purpose of the CCAA.

The applicant university brought a motion within its CCAA proceedings for an order extending the stay period and an order approving the refinancing of its debtor-in-possession (DIP) facility with the provincial government.

The court found that the applicant had acted in good faith and with due diligence, and that the cash flow forecast demonstrated sufficient liquidity to operate during the extended stay period.

The court granted the requested orders, noting the significant interest rate reduction under the replacement DIP facility.

The Auditor General of Ontario sought declarations that it had the authority under the Auditor General Act to compel grant recipients, specifically Laurentian University, to provide information and records subject to solicitor-client, litigation, or settlement privilege for audit purposes.

Laurentian University argued that the Act did not contain the clear and unambiguous language required to abrogate such fundamental privileges.

The court dismissed the Auditor General's application, holding that sections 10 and 27.1 of the Auditor General Act did not explicitly or unambiguously confer the power to compel disclosure of privileged information, and that privilege cannot be abrogated by inference.

In the CCAA proceedings of Laurentian University, the applicant sought an order regarding a Compensation Claims Process.

On consent, the court deferred relief related to Third Party RHBP Claims to a subsequent hearing, ordering that the deadlines and procedures in the Compensation Claims Process Order would not apply to those claims at this time.

The remaining unopposed relief was granted.

Thorneloe University sought leave to appeal a CCAA judge's decision that allowed Laurentian University to disclaim federation agreements and approved a debtor-in-possession (DIP) loan amendment.

Thorneloe argued the disclaimer would cause its insolvency, provided minimal financial benefit to Laurentian, and was motivated by anti-competition.

The Court of Appeal dismissed the leave motion, finding the proposed appeal was not prima facie meritorious, not of significance to the practice, and would unduly hinder the progress of the CCAA restructuring.

The court upheld the CCAA judge's balancing of interests under s. 32(4) of the CCAA, emphasizing the high deference owed to supervising judges in CCAA proceedings.

Laurentian University brought a motion within its CCAA proceedings seeking the appointment of a Chief Redevelopment Officer, an increase in the fee cap for the Board of Governors' independent counsel, and approval of a claims process.

The court approved the appointment of the CRO and the fee increase.

Regarding the claims process, TD Bank proposed amendments to require consultation on claims over $5 million.

Balancing the need for efficiency with creditor involvement, the court modified the claims process to establish an 'Inspector Group' to authorize the compromise of material claims, drawing on principles from the Bankruptcy and Insolvency Act.

The applicant, Laurentian University, brought a motion within its CCAA proceedings to extend the stay of proceedings, approve an amendment to its DIP facility increasing the available funds by $10 million, and approve settlement agreements with its faculty association, staff union, and Huntington University.

The court found that the applicant had acted in good faith and with due diligence, making significant progress in its restructuring.

Despite opposition from Thorneloe University and the University of Sudbury regarding the DIP amendment, the court approved the requested relief, finding the DIP conditions reasonable and the extension necessary for the applicant's continued operations and restructuring efforts.