Geoffrey B. Morawetz

The Liquidator of Maple Bank GmbH brought a motion seeking approval of a Settlement Agreement and a Sale Transaction with the Bank of Montreal, as well as an order sealing a Confidential Supplement containing unredacted transaction details.

The court applied the Soundair principles and the Sierra Club test, finding the settlement and sale to be fair, reasonable, and beneficial to the estate.

The court also granted the sealing order to protect commercially sensitive information that could prejudice ongoing negotiations with other parties.

The motion was granted on consent.

The appellants appealed decisions of the Ontario Securities Commission finding that they engaged in insider trading after receiving material non-public information from an administrative assistant at an investment bank.

The Commission relied on circumstantial evidence, including the proximity of telephone calls to highly profitable trades.

The Divisional Court dismissed the appeals, holding that the Commission's inferences were reasonable and that the use of compelled examination transcripts was procedurally fair.

The Court also upheld the sanctions, which included trading bans, administrative penalties, and disgorgement orders.

The Proposal Trustee sought court approval for the proposals of Wasaya Airways Leasing Ltd. (WALL) and the joint proposal of Wasaya Airways Limited Partnership (WALP) and Wasaya General Partner Limited (WGPL).

The court considered the appropriateness of a joint proposal for related corporations under the Bankruptcy and Insolvency Act (BIA), noting the lack of specific BIA provisions but relying on prior judicial interpretations.

The proposals, which offered unsecured creditors a better outcome than bankruptcy, were overwhelmingly approved by creditors.

The court found the proposals reasonable, beneficial to creditors, and made in good faith, also acknowledging the public interest in the debtors' essential services to remote First Nations communities.

The Receiver brought a motion seeking a determination on whether the estates of Redstone Investment Corporation (RIC), Redstone Capital Corporation (RCC), and 1710814 Ontario Inc. o/a Redstone Management Services (RMS) should be substantively consolidated.

RIC and RMS Investors argued for consolidation, while RCC Investors opposed it, citing a General Security Agreement (GSA) granting RCC priority over RIC's assets.

The court found the founder's (Mr. So) evidence unreliable and dismissed subjective investor state of mind as irrelevant to the consolidation analysis.

Applying the Northland factors, the court determined that the elements of consolidation were not present, as assets were segregable, financial statements were separate, and significant prejudice would result to RCC Investors if consolidation were ordered.

The motion for substantive consolidation was denied.

The applicant employer sought judicial review of an Ontario Labour Relations Board decision that reinstated an employee terminated shortly after participating in a union organizing drive.

The Board found the employer failed to prove the termination was free of anti-union animus.

On judicial review, the employer argued the Board breached procedural fairness by refusing to admit new evidence of poor job performance at the hearing, and that its credibility findings were unreasonable.

The Divisional Court dismissed the application, holding that the Board's refusal to admit late evidence accorded with its rules and procedural fairness, and that its findings of fact and credibility were reasonable and well-supported by the evidence.

The Director of the Ontario Racing Commission sought judicial review of a Panel decision that exonerated a horse trainer from an absolute liability offence based on a due diligence defence.

The horse had tested positive for a prohibited drug after winning a race.

The Divisional Court held that the Panel's decision was unreasonable because a standard of care defence is not available for an absolute liability offence.

The Court set aside the Panel's decision, restored the original finding of a rule violation, and exercised its jurisdiction to impose a penalty of no fine and no suspension, leaving the horse's disqualification intact.

The plaintiff appealed a motion judge's refusal to approve a class action settlement regarding alleged copyright infringement by the defendant's online legal database.

Following Supreme Court of Canada decisions that significantly enhanced the defendant's fair dealing defence, the parties agreed to a settlement including a cy-près payment and a non-exclusive licence from class members.

The Divisional Court allowed the appeal and approved the settlement, finding the motion judge erred in characterizing the licence as a property right and in elevating the standard for settlement approval by introducing 'institutional fairness' as a new factor.

The appellant sought leave to appeal a costs order of $10,000 following the settlement of a slip and fall action for $15,000.

The appellant had originally claimed over $750,000 and incurred disbursements exceeding the settlement amount.

The Divisional Court denied leave to appeal, finding that the motion judge did not err in principle and that the costs award was proportionate and reasonable given the circumstances.

The appellant appealed a Superior Court order that dismissed his appeal of a Property Standards Order and an Order to Comply requiring him to remove structures and debris from his property.

The Divisional Court held it had no jurisdiction to hear the appeal of the Property Standards Order, as the lower court's decision was final under the Building Code Act.

The court dismissed the appeal of the Order to Comply, rejecting the appellant's argument that a Crown Patent exempted his land from provincial and municipal regulation.

The applicants in CCAA proceedings sought an extension of the Stay Period to April 15, 2016, as they prepared an Amended and Restated Plan of Compromise.

The court found the parties were working in good faith and with due diligence, and granted the extension.

The court also approved an agreement to lift the Co-Tenancy Stay on acceptable terms and extended the Notice of Objection Bar Date.

In the context of CCAA proceedings for Target Canada Co. and related entities, the applicant brought an unopposed motion to establish a streamlined process for identifying and resolving common issues among pharmacist claims.

The court granted the motion, noting the benefit of an expeditious and efficient procedure to resolve such disputes, and approved the modified fee arrangements subject to court approval.

In the context of CCAA proceedings, the applicant sought to add its highly integrated subsidiary, GuestLogix Ireland Limited, as an applicant to facilitate a comprehensive sale and investor solicitation process.

The applicant also sought approval for an Administration Charge, a Directors' Charge, and an Interim Lender's Charge to secure interim financing of up to US $3,000,000.

The court granted the unopposed motion, finding the addition of the subsidiary appropriate and the requested charges and financing necessary and reasonable under the CCAA.

The applicant, GuestLogix Inc., sought an initial order under the Companies' Creditors Arrangement Act (CCAA) for a stay of proceedings, the appointment of a Monitor, and authorization for super-priority charges.

The court found the applicant to be an insolvent debtor company with over $5 million in unsecured liabilities, making it eligible for CCAA protection.

The court granted the stay and the requested Administration and Directors' Charges.

However, due to a potential conflict of interest raised by a secured creditor, the court declined to appoint the proposed Monitor, Deloitte Restructuring Inc., and instead appointed PricewaterhouseCoopers Inc.

The moving party, a former CFO of a company undergoing CCAA restructuring, sought a declaration that a court-approved settlement and release barred the Chartered Professional Accountants of Ontario (CPAO) from commencing disciplinary proceedings against him.

The court dismissed the motion, finding that the CPAO's regulatory proceedings regarding professional misconduct did not constitute a 'claim' under the CCAA, nor were they claims against him in his capacity as a director or officer.

Furthermore, the disciplinary proceedings did not fall within the definition of released claims in the settlement order, and the CPAO was not bound by the order as it had not received notice.

The Attorney General of Canada, at the request of the Superintendent of Financial Institutions, applied for a winding-up order under the Winding-up and Restructuring Act in respect of the Canadian business of an authorized foreign bank.

The bank had admitted insolvency following the emergence of significant German tax claims and the imposition of a moratorium by German regulators.

The court found that the Superintendent had ample basis to take control of the bank's Canadian assets under the Bank Act.

Given the bank's admitted insolvency and the appointment of a German insolvency administrator, the court concluded it was just and equitable to grant the winding-up order and appoint a liquidator.

In the context of a receivership, representative counsel for the investors of Redstone Capital Corporation brought a motion for leave to deliver a new affidavit in an ongoing substantive consolidation hearing.

The hearing had already commenced and was adjourned pending this motion.

The court applied the test under Rule 39.02(2) of the Rules of Civil Procedure and found that the proposed evidence, which detailed an individual investor's motivation for investing, was not relevant to the test for substantive consolidation.

The motion for leave was dismissed.

The appellants appealed a decision.

At the hearing, an alleged conflict was raised.

The Divisional Court was unable to ascertain the facts respecting the alleged conflict on the record.

As a result, the appeal was adjourned to be heard on a later date with a newly constituted panel due to scheduling exigencies.

The Ad Hoc Committee of Purchasers of the Applicants' Securities moved for approval of a settlement agreement and plan of allocation in the context of CCAA proceedings involving Cash Store Financial Services and related entities.

The settlement provided for a payment of $13,779,167 by the defendants to resolve allegations of false and misleading statements regarding financial results.

The court approved the settlement and the associated third-party releases, finding them fair, reasonable, and consistent with the purpose of the CCAA.

The motion to approve the plan of allocation was adjourned on consent.

In CCAA proceedings involving a global settlement of securities class actions arising from the restructuring of a payday lending group, class counsel sought court approval of legal fees and disbursements payable from the settlement fund.

The requested fees represented approximately 25.29% of the settlement amount and were incurred on a contingency basis.

The court considered the risks undertaken, the success achieved, the terms of the retainer agreements, and the range of percentages approved in comparable class proceedings.

Despite objections from several entities claiming the fees were excessive, the court found the request fair and reasonable.

The court approved the fees, disbursements, and modest honoraria to representative plaintiffs.

In Companies’ Creditors Arrangement Act proceedings involving several related corporate applicants, the court considered a motion for approval of the professional fees and disbursements of the court-appointed monitor and its counsel.

The fees covered the period of the restructuring proceedings following the initial CCAA protection order.

The monitor reported that it had reviewed its counsel’s accounts and considered them fair and reasonable.

No party objected to the requested amounts, and secured noteholders with a direct financial interest did not oppose the requests.

The court approved the monitor’s and its counsel’s fees and disbursements as reasonable in the circumstances.