Jeremy R. Opolsky

The Superior Court of Justice considered a motion by BCIMC and Otera Capital to approve a Sale and Investor Solicitation Process (SISP) for three condominium projects (Yorkville, Clover, Halo) under receivership.

The court approved the SISP for the Yorkville project.

For the Clover project, the court declined to approve the SISP, affirming the debtor's right of redemption after Concord Land Developments acquired the debtor's shares and offered to pay out all BCIMC debt and receivership costs.

For the Halo project, the SISP was approved, but without a stalking horse bid and without restrictions on communication between bidders and stakeholders, as the debtor was not yet able to pay out the debt.

This proceeding involved competing applications for the appointment of a receiver and manager under the Bankruptcy and Insolvency Act and the Courts of Justice Act, and an application for protection under the Companies’ Creditors Arrangement Act (CCAA).

The applicants, secured creditors, sought receivership over three residential condominium projects (The Clover, Halo, and 33 Yorkville) due to significant financial irregularities, lack of transparency, and loss of confidence in the debtors' management.

The debtors opposed receivership and sought CCAA protection, proposing a share sale to Concord Group Developments and a plan to disclaim existing purchase agreements.

The court dismissed the CCAA application and granted the receivership application, finding that receivership was the preferable route.

The court emphasized the secured creditors' blocking position, the absence of a concrete CCAA plan, and the debtors' deliberate financial misconduct, which outweighed any potential benefits of a CCAA proceeding.

Three cross-appeals arose from the interpretation of a 1985 environmental indemnity granted by the Province of Ontario to former pulp mill owners, their successors and assigns, in the context of the settlement of mercury contamination litigation brought by two First Nations.

The majority held that the indemnity did not cover first party regulatory compliance orders, as the motion judge made palpable and overriding factual errors, and the indemnity, properly read as a whole, was intended to cover only third party pollution claims.

The appeal of the Province was allowed; the appeals of the corporate successors were dismissed.

The dissent (Côté, Brown and Rowe JJ.) would have dismissed the Province's appeal and allowed the appeal of Resolute, concluding the indemnity covered the Director's remediation order, that the fettering doctrine did not render the indemnity unenforceable, and that Resolute — as Great Lakes' corporate successor — was entitled to the indemnity's protection, but Weyerhaeuser was not, as neither an assignee nor a corporate successor of Great Lakes or Reed.

The appellant, an investor, sought damages from specific-project corporations on the basis of knowing assistance in a breach of fiduciary duty arising from a complex multi-million dollar real estate fraud perpetrated by a married couple.

The couple convinced investors to invest in specific-project corporations to acquire and hold commercial real estate, but instead diverted the funds for personal use.

The application judge dismissed the knowing assistance claim, finding the fraudulent wife's knowledge could not be imputed to the specific-project corporations.

The majority of the Court of Appeal allowed the claim.

The Supreme Court of Canada allowed the appeal, agreeing with the dissenting judge below that the knowing assistance claim must fail.

The Court clarified that while Livent permits courts to decline to apply corporate attribution where the public interest so requires, the minimal criteria from Canadian Dredge must always first be satisfied.

Following the dismissal of the appellants' appeal from an order liquidating the corporate defendant, the respondent sought costs of the appeal and a prior stay motion.

The Divisional Court fixed costs at $25,000 on a partial indemnity basis, payable solely by the personal appellants to prevent the respondent from effectively paying half of his own costs through the corporation.

The court also ordered the personal appellants to fully indemnify the respondent and the corporation for the fees of a monitor appointed during the stay, as the monitor was necessitated by the personal appellants' oppressive conduct.

The appellants appealed a motions judge's decision ordering the liquidation of a closely-held corporation as a remedy for oppression and breach of fiduciary duty.

The appellants argued that the remedies of disgorgement and constructive trust were sufficient and that liquidation was punitive.

The Divisional Court dismissed the appeal, finding that the motions judge properly exercised his discretion to order liquidation because the trust underpinning the shareholders' agreement had been destroyed, the appellants had committed grave breaches, and the business was no longer operating as originally intended.

The court also upheld the brief two-week election period granted to the appellants to purchase the respondent's shares.

The appellant, Georgian Properties Corporation, appealed a summary judgment that reduced the principal amounts owing under two vendor take-back mortgages given by the respondent condominium corporation to the developer.

The mortgages related to HVAC service units and unsold parking and storage units.

The motion judge found the developer's revised disclosure documents infringed the Condominium Act and that both transactions were oppressive.

The principal amounts were reduced to reflect fair market value.

The Court of Appeal upheld the motion judge's findings regarding insufficient disclosure and oppression, dismissing the appeal and cross-appeal.

The appellant sought life insurance proceeds after paying premiums under an oral separation agreement that required maintenance of her beneficiary designation.

The insured later redesignated a new spouse as irrevocable beneficiary, and the proceeds were paid accordingly.

The majority held the respondent was unjustly enriched at the appellant’s expense and found no juristic reason under the Insurance Act to defeat restitution.

A remedial constructive trust over the full proceeds was imposed because a personal remedy was inadequate in the circumstances.

The dissent would have dismissed the appeal on the basis that statutory beneficiary protections supplied a juristic reason and that corresponding deprivation was not established.

The applicants, a group of Essar Steel Algoma entities, brought a motion under the Companies' Creditors Arrangement Act (CCAA) for approval of an Asset Purchase Agreement (APA) and related relief.

GIP and PortCo objected to certain aspects of the APA and the orders sought.

The court approved the APA and the Sale Transaction, finding it to be in the best interests of Algoma and its stakeholders.

The approval was granted without prejudice to the rights of GIP and PortCo to raise further objections regarding the Approval and Vesting Order at a later date.

Several other motions, including those by GIP, PortCo, and Garden River First Nations, were adjourned.

The court also ordered certain cross-examination transcripts and exhibits to be sealed based on the principles from the Sierra Club of Canada case.

The plaintiff brought an action for wrongful dismissal, alleging she was terminated in part due to her romantic relationship with the defendant's CEO and issues relating to her children's cell phones.

She pleaded discrimination based on marital and family status under the Human Rights Code.

The defendant moved to strike these pleadings for disclosing no reasonable cause of action.

The court declined to strike the marital status claim, finding that a serious romantic relationship might fall within the evolving definition of marital status.

However, the court struck the family status claim because the plaintiff did not plead discrimination based on a parent-child relationship.

This is a costs endorsement on appeal from a Superior Court judgment.

The unsuccessful appellants (Essar entities and GIP entities) were ordered to pay costs to the successful respondents (the Monitor and Algoma Steel).

The parties agreed on the quantum of costs but disagreed on whether liability should be several or joint and several.

The court awarded costs on a several basis, allocating 25% to GIP and 75% to Essar, finding that GIP had a more limited role with different issues and less oral argument time than Essar.

A CCAA monitor brought an oppression action under the Canada Business Corporations Act against the parent company (Essar Global) and related entities, alleging that a port transaction transferring critical assets to an Essar-controlled entity was oppressive to Algoma's stakeholders (trade creditors, employees, pensioners, and retirees).

The trial judge found the monitor had standing as a complainant, the action was properly brought as an oppression remedy rather than a derivative action, and the port transaction and its change of control provision were oppressive.

The court granted a remedy modifying the transaction to remove the change of control veto and provide Algoma with termination rights after GIP's loan was repaid.

The appellants appealed on multiple grounds, including standing, characterization of the claim, reasonable expectations analysis, and the appropriateness of the remedy.

The Court of Appeal upheld the trial judgment in all respects.

The Court of Appeal for Ontario considered whether a 1985 indemnity provided by the Province of Ontario to Great Lakes and Reed covered the costs of complying with a 2011 Director's Order requiring remedial work at an abandoned mercury waste disposal site near Dryden, Ontario.

The motion judge had granted summary judgment in favour of Weyerhaeuser and Resolute, finding both were entitled to indemnification.

The appellate court was divided.

The majority (Brown and Lauwers JJ.A.) held that the 1985 indemnity did cover the costs of complying with the Director's Order, but found that Resolute had no legal interest in the indemnity because Bowater had assigned the full benefit to Weyerhaeuser in 1998.

The majority remitted the issue of Weyerhaeuser's rights as assignee to the trial court.

Justice Laskin dissented, arguing the 1985 indemnity covered only third-party pollution claims, not first-party regulatory compliance costs.

Following an oppression action within CCAA proceedings, the court determined costs claims by Algoma and GIP.

The Essar Defendants agreed to pay $1.7 million in costs to the Monitor.

Algoma sought partial indemnity costs against the Essar Defendants, largely for extensive e-discovery disbursements.

The court rejected the argument that Algoma should be denied costs because it was aligned with the Monitor, finding Algoma's participation and document production were critical to the case.

The court awarded Algoma $1,138,809.19 in costs.

GIP's claim for costs against the Monitor was dismissed with no order as to costs, as the court found success between the Monitor and GIP was divided.

Motions for leave to appeal from an order of the Superior Court of Justice dismissing a motion to require Algoma to resume payments under a Cargo Handling Agreement in the context of CCAA proceedings.

The applicants sought to invoke section 11.01(a) of the Companies' Creditors Arrangement Act to compel payment for post-filing services.

The motion judge had dismissed the motion three times on the same legal grounds.

The Court of Appeal dismissed the leave motions, finding no prima facie merit due to issue estoppel and no significance to the practice, as the issues were specific to the unique agreements underlying the Port Transaction.

GIP Primus, L.P. and Brightwood Loan Services LLC ("GIP"), along with Portco, brought motions seeking orders for Essar Steel Algoma Inc. ("Algoma") to resume payments under a Cargo Handling Agreement, including arrears, and for a priority charge in the alternative.

The motions were based on section 11.01(a) of the CCAA, arguing that Portco provided critical services or licensed property.

The court dismissed the motions, reiterating previous findings that Portco did not provide services or a license, and that the arguments were previously decided.

The court also declined to grant a critical supplier charge under section 11.4 or the general discretion of section 11 of the CCAA, citing lack of application by the debtor, prior rulings, and potential breach of DIP loan terms and prejudice to other creditors.

Self-represented long-term disability beneficiaries sought leave to appeal a sanction order from the Superior Court of Justice in the Nortel Networks CCAA proceedings.

The applicants challenged their binding status under the 2009 Representation Order for Disabled Employees and the 2010 Employee Settlement Agreement.

The Court of Appeal dismissed the motion for leave to appeal, finding that the stringent test for leave in CCAA proceedings was not met.

The proposed appeal lacked merit, the applicants were bound by the settlement agreement, and further delays in the protracted litigation were to be avoided.

The court also rejected a late-filed notice of constitutional question challenging sections 6(1) and 11 of the CCAA.

The CCAA monitor of Algoma brought an oppression action under the CBCA against Algoma's parent company, Essar Global, regarding a transaction that transferred Algoma's critical port facilities to a related entity.

The court found that the monitor had standing to bring the action on behalf of creditors.

The court held that the port transaction and a change of control clause giving Essar Global a veto over any buyer of Algoma violated the reasonable expectations of creditors and were oppressive.

The court rejected the business judgment rule defence and ordered the deletion of the change of control clause and amended the agreements to allow Algoma to terminate them after a third-party loan is repaid.

Essar Capital Limited and USW Local 2251 brought motions within a Companies’ Creditors Arrangement Act (CCAA) proceeding.

Essar Capital sought to re-open the Sale and Investment Solicitation Process (SISP) and compel the disclosure of information to Essar Global for a potential bid.

Local 2251 sought court advice on engaging in discussions with Ontario Steel Investments Ltd. regarding potential transactions.

The court dismissed both motions, finding no basis to interfere with the established SISP, noting Essar Global's prior failure to demonstrate financial capability and the lack of a formal bid from Ontario Steel.

The court emphasized the need to maintain the integrity of the court-ordered process and avoid delays detrimental to the restructuring.

The applicant and respondent were former spouses who entered into an oral agreement that the respondent would pay premiums on a life insurance policy and receive the proceeds upon the deceased's death.

The deceased subsequently designated the applicant as an irrevocable beneficiary under the policy without informing the respondent, who continued paying premiums.

Upon the deceased's death, the respondent claimed entitlement to the proceeds based on unjust enrichment and sought a constructive trust.

The application judge ruled in the respondent's favour, finding an equitable assignment.

The Court of Appeal allowed the appeal, holding that the application judge erred in relying on the doctrine of equitable assignment, which was neither pleaded nor argued.

The court found that the irrevocable beneficiary designation provisions of the Insurance Act provided a valid juristic reason for the applicant's receipt of the proceeds, making unjust enrichment unavailable.