Hayley Pitcher

A priority dispute arose between Royal Bank of Canada (RBC), a secured creditor of bankrupt contractor A-1 Asphalt Maintenance Ltd., Guarantee Company of North America (GCNA), a bond company and secured creditor, and certain employees represented by unions.

The central issue was whether funds paid to the receiver by owners, which constituted "trust funds" under section 8 of the Construction Lien Act (CLA), were excluded from the bankrupt's estate available to creditors pursuant to section 67(1)(a) of the Bankruptcy and Insolvency Act (BIA).

The motion judge found the funds were not excluded and were available for distribution.

The Court of Appeal allowed the appeal, holding that provincially created statutory trusts satisfying general principles of trust law are preserved from distribution to ordinary creditors under the BIA.

The court issued a costs endorsement following successful motions by the Attorney General of Ontario, Her Majesty the Queen in Right of Ontario, and the Independent Electricity System Operator (IESO) to strike two constitutional challenge applications.

The applications, brought by National Steel Car Limited, challenged aspects of Ontario's Global Adjustment electricity regime.

The court awarded partial indemnity costs to the Attorney General and Her Majesty in the amount of $50,000, and to the IESO in the amount of $75,000.

The decision considered the general principles of costs under Rule 57.01, the principle of indemnity, and the reasonable expectations of the parties.

It addressed the applicant's argument of being a public interest litigant and confirmed that a party fully participating in and supporting a successful motion, even without formally bringing it, can be awarded costs, subject to adjustment.

The respondents brought a motion to strike out two applications challenging the constitutionality of the Global Adjustment under the Electricity Act, 1998.

The responding party argued that the Global Adjustment was an unconstitutional tax that violated s. 53 of the Constitution Act, 1867.

The court applied the Lawson and Westbank tests, concluding that the Global Adjustment is a regulatory charge tied to a complex regulatory scheme, not a tax.

The court found it plain and obvious that the applications could not succeed and granted the motion to strike.

An appeal from a Superior Court decision dismissing an appeal from a Consent and Capacity Board decision confirming the appellant's involuntary status under the Mental Health Act.

The appellant, a dangerous offender with a lengthy history of violent and sexual crimes, challenged his detention as an involuntary psychiatric patient, arguing that the Mental Health Act was being used to extend his prison sentence indefinitely (psychiatric gating) and that his Charter rights were violated.

The Court of Appeal upheld the Board's decision, finding that the appellant suffers from mental disorders (paraphilia, antisocial personality disorder with psychopathy) that pose a serious risk to others, that the initial Form 1 was properly completed, and that the appellant's Charter claims under sections 7, 9, 11(h), and 12 all failed.