Jennifer Quick

The applicants sought an amended and restated initial order under the CCAA, including approval of a stalking horse sales process, a Key Employee Retention Plan, an increased administration charge, and an extension of the stay of proceedings.

The court granted most of the requested relief, finding it necessary for the restructuring and supported by the Monitor.

However, the court dismissed the applicants' request to stay a creditor's action against three directors on their personal guarantees, ruling that section 11.03(2) of the CCAA expressly prohibits staying actions against directors on guarantees relating to the company's obligations.

The defendants brought a motion to set aside an order to continue obtained by the plaintiff on requisition.

The parties had previously agreed to schedule a case conference to discuss how the action should be reconstituted following the original plaintiff's death.

Despite this agreement and knowing the issue was contentious, the plaintiff's counsel obtained the order to continue without notice.

The court found that the plaintiff's counsel failed to act in good faith and candour by obtaining the order while the issue was scheduled for a case management hearing.

The motion was granted and the order to continue was set aside.