The appellant landlords leased commercial space to the respondent, who subsequently assigned the leases.
The assignee became insolvent and repudiated the leases pursuant to s. 65.2 of the Bankruptcy and Insolvency Act.
The landlords sued the original tenant for rent arrears.
The motion judge dismissed the actions, finding the repudiation terminated the leases for all purposes.
The Court of Appeal allowed the appeal, holding that a repudiation under s. 65.2 only affects the obligations of the insolvent assignee and does not terminate the lease or release the original tenant from its primary liability to the landlord.
