Geoffrey B. Morawetz

This supplementary endorsement addresses a challenge to a sealing order granted in the Companies’ Creditors Arrangement Act (CCAA) proceedings of Laurentian University of Sudbury.

The sealing order covered confidential correspondence between the University and the Ministry of Colleges and Universities, which Laurentian University argued contained sensitive information that, if disclosed, could jeopardize its restructuring efforts.

Parties opposing the sealing order contended there was no evidentiary basis for it.

Applying the two-branch test from Sierra Club of Canada v. Canada (Minister of Finance), the court found that the disclosure posed a real and substantial risk to the University's future viability, that the "commercial" interest extended to the broader community, and that no reasonable alternatives existed given ongoing mediation.

Consequently, the court maintained the confidentiality of the exhibits and the existing sealing order.

The applicant hospital sought judicial review of a labour arbitration award regarding the interpretation of early retirement and voluntary exit provisions in a collective agreement.

The arbitration panel found that the benefits must be offered to all employees within a classification based on seniority, rejecting the hospital's past practice of offering them strictly on a full-time to full-time and part-time to part-time basis.

The Divisional Court dismissed the application, holding that the panel's interpretation of the collective agreement and its treatment of past practice evidence were reasonable under the Vavilov framework.

Laurentian University (LU) sought an Amended and Restated Initial Order under the Companies' Creditors Arrangement Act (CCAA) to facilitate its restructuring.

The requested relief included an extension of the stay of proceedings until April 30, 2021, approval of a $25 million Debtor-in-Possession (DIP) facility, an increase in the Administration Charge to $1.25 million, and an increase in the Directors' Charge to $5 million.

LU also sought a stay of pre-filing and post-filing special payments to its defined benefit pension plan and a stay of requests under the Freedom of Information and Protection of Privacy Act (FIPPA).

The court granted all requested relief, finding it necessary and reasonable for the continued operation and restructuring of the university.

The sealing order for certain confidential exhibits was maintained pending a supplementary endorsement.

Laurentian University of Sudbury applied for an Initial Order under the Companies' Creditors Arrangement Act (CCAA) due to a severe liquidity crisis and insolvency.

The court found that the university, a not-for-profit corporation, qualifies as a debtor company under the CCAA.

The court granted the Initial Order, which included a stay of proceedings, authorization for pre-filing and post-filing payments to students, an Administration Charge, and a Directors' Charge.

The court also granted a sealing order for confidential correspondence with the Ministry to protect the restructuring efforts.

The Receiver and Monitor sought court approval for the sale of geothermal assets and an order compelling the assignment of a long-term lease (the "Berm Lease") to the purchaser.

King Towns North Inc. (KTNI), the landlord under the Berm Lease, opposed the assignment order, arguing that the Bankruptcy and Insolvency Act (BIA) does not grant receivers statutory authority to compel assignments and that the assignment was inappropriate given the nominal rent and a lease clause allowing unreasonable withholding of consent.

The court found jurisdiction to grant the assignment order under BIA s. 243(1)(c) in conjunction with s. 100 of the Courts of Justice Act, or alternatively, through its inherent jurisdiction, emphasizing a purposive approach to Canadian insolvency laws.

The court concluded that the assignment was appropriate, as it was critical to the transaction, the assignee's financial obligations were nominal, and KTNI's allocation entitlements could be addressed at a later date.

The sale transaction and a sealing order for confidential information were also approved.

Lydian International Limited, the applicant in CCAA proceedings, sought an order to extend the stay of proceedings until March 31, 2021, or the filing of the Monitor's CCAA Termination Certificate, and to approve the Monitor's Eighth Report.

The CCAA Plan was sanctioned earlier, and Lydian International was undergoing an orderly wind-up in Jersey.

Due to unforeseen delays in the Jersey winding-up process, an extension of the stay was required.

The court found that the parties were working diligently and the applicant had sufficient financial resources.

The Monitor's report received no adverse comments.

Representations from shareholders regarding their investment loss were noted but deemed irrelevant to the requested relief, which did not alter the Plan Sanction and Implementation Order.

The court granted the motion, extending the stay and approving the Monitor's report.

The court-appointed Monitor in a CCAA proceeding brought a motion to approve a third amendment to a DIP credit facility to allow the debtor to contribute required equity to a real estate development project.

The Foreign Representative raised concerns about the lender's conduct and lack of information, but the Monitor recommended approval as there were no alternative funding options and the lender agreed to reduce the maximum charge and set a short maturity date.

The court approved the amendment, noting it was necessary to preserve the project and that outstanding issues could be addressed prior to maturity.

The court-appointed Receiver of Chieftain Metals brought a motion for discharge.

The secured creditor, West Face, supported the discharge but sought a provision allowing it to move for the re-appointment of a receiver at any time in the future to facilitate a potential sale of the mining project.

The Province of British Columbia and the Taku River Tlingit First Nation opposed an open-ended right, citing environmental remediation concerns and uncertainty.

The court granted the discharge but limited the secured creditor's right to seek re-appointment to a two-year period, balancing the commercial interests with the need for certainty for the Province and First Nation.

The Construction Receiver brought a motion for approval of its activities, fees, final distribution, and discharge.

Terra Firma, the highest-ranking secured creditor, brought a second motion seeking distribution of a $202,500 Park Levy Reserve collected from unrepresented condominium purchasers.

The court granted the Receiver's motion but dismissed Terra Firma's motion, finding that the Park Levy was mistakenly collected, never became the property of the debtor, and therefore could not form part of Terra Firma's collateral.

The Receiver was directed to return the funds to the unrepresented purchasers.

The Monitor and Receiver in the CCAA proceedings of Urbancorp Toronto Management Inc. and affiliated entities brought three unopposed motions.

The court granted an extension of the stay period, finding the parties were working in good faith and had sufficient cash flow.

The court also granted a vesting order resolving a dispute over Fuzion Geothermal Room Units and approved a settlement between the Receiver and TS Sports Consulting Inc. regarding advisory fees, finding the settlement fair and commercially reasonable.

This motion concerned the winding-up of Maple Bank GmbH.

The Liquidator sought approval for a Fourth Interim Distribution, a reduction in the reserve held, and approval of the Fourteenth Report of the Liquidator and its activities.

Additionally, the Liquidator sought approval for a Data Custodian Order.

There was no opposition to the requested relief, with Canada Revenue Agency's pending claim being addressed by a maintained reserve.

The court granted the motion, approving the distribution, the reduction in reserve, the Liquidator's report and activities, and the Data Custodian Order.

The Applicants, part of the Lydian Group which owns a development-stage gold mine in Armenia, sought an order sanctioning their Plan of Arrangement under the CCAA.

The Plan, supported by the Monitor and the requisite majority of secured creditors, provides for the privatization of the Lydian Group and the release of existing indebtedness to Senior Lenders.

The court found the Plan to be fair and reasonable, noting that while equity claimants would receive no compensation, this reflected the economic reality of the insolvency.

The court also approved third-party releases, an increase to the DIP charge, an extension of the stay period, a sealing order for commercially sensitive information, and the Monitor's activities and fees.

The Applicants in a CCAA proceeding sought a Meeting Order to accept the filing of a Plan of Compromise or Arrangement, approve creditor classification, authorize a meeting for voting on the Plan, set a sanction hearing date, and seal certain affidavits.

The court granted the motion, finding the Plan had sufficient support to summon a creditors' meeting, the proposed single class of secured creditors had a commonality of interest under CCAA s. 22(2), and the sealing of commercially sensitive information in the affidavits was appropriate.

The Superintendent of Bankruptcy brought a motion seeking orders to provide flexibility to the administration of Ontario insolvency estates affected by COVID-19.

The relief sought included increasing payment defaults/time for deemed annulment of consumer proposals under s. 66.31(1) BIA, extending timelines for creditor meetings (ss. 51, 66.15, 102 BIA) and mediations (rules 105(4), (10) BIGR), extending time for court referrals (s. 170.1(3) BIA), applying the order to all active and future insolvency filings until June 30, 2020, and dispensing with notice.

The court granted the requested relief, finding jurisdiction under ss. 66.31(1) and 187(11) of the BIA, and its inherent jurisdiction, given the exceptional circumstances of the pandemic.

This endorsement addresses a motion by Lydian International Limited and its affiliates to extend a stay period under the Companies’ Creditors Arrangement Act (CCAA).

Following an initial order granting a 10-day stay, the applicants sought an extension.

The court had previously declined to grant the extension at the initial hearing, interpreting CCAA s. 11.001 to limit initial orders to ordinary course relief and maintain the status quo during the initial 10-day period.

The motion for extension was deferred to allow stakeholders to consider their positions.

With no opposition filed and the Monitor's support, the court found that the applicants were acting in good faith and with due diligence, justifying an extension of the stay period to January 23, 2020, to facilitate discussions with lenders and stakeholders regarding financing and sale options for their gold mine project.

The Applicants, part of a gold exploration and development business, sought an initial order for creditor protection under the CCAA due to liquidity issues caused by blockades at their Amulsar Project in Armenia.

The court granted the initial order, including a 10-day stay of proceedings, the appointment of a monitor, and the approval of Administration and D&O charges, finding them reasonably necessary for continued operations.

However, the court declined to immediately grant a stay extension beyond the initial 10-day period, emphasizing that recent CCAA amendments limit initial relief to what is necessary to avoid immediate liquidation, absent exceptional circumstances.

The plaintiff sued several police officers and the London Police Services Board for negligent investigation following his arrest for break and enter and breach of recognizance in the context of a domestic dispute.

The trial judge found two officers and the Board liable and awarded damages.

The defendants appealed.

The Divisional Court allowed the appeal, finding that the trial judge relied on a legal test that was subsequently overturned by the Court of Appeal.

Applying the correct standard, the court held that the police acted reasonably based on the information available to them and had reasonable and probable grounds for the arrests.

The action was dismissed.

The moving parties, purchasers of condominium units, brought a motion seeking a declaration that the court-appointed receiver had no right to charge a 'parks levy' as an adjustment on the closing of their units.

The receiver argued that the contractual provision allowed it to charge the purchasers for the notional value of parkland conveyed to the municipality.

The court found that the contractual language was ambiguous and, applying the principles of contractual interpretation and contra proferentem in the context of a consumer contract, ruled in favour of the purchasers.

The receiver was ordered to repay the parks levy amounts with interest.

The applicant City sought judicial review of an arbitration award that found it breached its duty to accommodate a disabled employee.

The employee, who could only work part-time, had been permitted to remain in the full-time bargaining unit for years, receiving better benefits.

The City eventually transferred him to the part-time unit.

The arbitrator held this transfer was discriminatory absent a change in circumstances or undue hardship.

The Divisional Court granted the judicial review, finding the arbitrator's decision unreasonable and inconsistent with the Court of Appeal's ruling in Orillia Hospital, which established that requiring work in exchange for compensation is a bona fide occupational requirement.

The arbitration award was quashed and the grievance dismissed.

The applicant brought a motion to set aside an order denying its request to file an affidavit as part of its record in an application for judicial review of an Ontario Labour Relations Board decision.

The applicant argued that the affidavit was necessary to show the Board's findings of fact were unreasonable.

The Divisional Court dismissed the motion, finding no error of law by the motion judge, who was bound by established precedent that restricts the admission of new affidavit evidence on judicial review.