John J. Salmas

In WURA proceedings concerning the wind-up of a foreign bank’s Canadian business, the court considered an unopposed motion by the court-appointed liquidator for approval of reports, fees, discharge of employee representative counsel, termination of proceedings, and related releases.

The court held the remaining tasks were administrative and that the affairs in Canada had been fully wound up subject to completion of those tasks.

The court approved the reports, activities, fees, and proposed releases, finding the releases appropriately limited and consistent with analogous third-party release principles developed under federal insolvency jurisprudence.

The court accepted that CCAA release principles could be applied by analogy in WURA proceedings.

The motion was granted and a discharge and termination order issued with immediate effect.

This endorsement grants several orders sought by the Applicants in ongoing Companies' Creditors Arrangement Act (CCAA) proceedings, including approval of the Monitor’s reports and activities, amendment of reporting obligations, addition of Block 6 Holding Inc. as an Applicant, approval of a property sale and related distributions, and the appointment of a mediator to address cost allocation issues among financiers.

The court finds all relief appropriate and supported by the record.

This decision concerns motions brought by Pride Group Holdings Inc. and related applicants under the Companies' Creditors Arrangement Act (CCAA) for interim relief in their restructuring proceedings.

The court addresses requests for approval of interim distributions, payment of direct costs, application of deferred payments for working capital, and approval of certain activities of the Monitor.

The court grants the requested relief, finding it necessary to maintain liquidity and continue the wind-down process, and holds that the proposed mechanisms are equitable and consistent with the CCAA’s remedial objectives.

In the context of CCAA proceedings, the applicants sought a Funding Order to compel Securitization Parties and other secured lenders to fund a $40 million wind-down of the remaining entities.

The court dismissed the motion for the Funding Order, finding that section 11.01(b) of the CCAA expressly prohibits orders requiring the further advance of money or credit.

Consequently, the court also declined to approve a Key Employee Retention Plan, as it was dependent on the unavailable funding.

The court did, however, grant a temporary sealing order for the KERP details and extended the stay of proceedings to November 29, 2024.

In the context of ongoing CCAA proceedings, the applicants and various equipment financiers reached an impasse regarding the wind-down plan and a proposed going-concern sale of the logistics business.

The applicants sought a monetization order, an increase in the administration charge, and lien regularization, which were unopposed and granted by the court to maintain operations.

Due to significant disputes over the sale and liquidation of assets, the court adjourned the contested motions, including several lift-stay motions brought by creditors, and ordered the parties to attend mandatory mediation before a former Commercial List judge.

In a CCAA proceeding, the Applicants sought three orders: approval of a factoring portfolio purchase agreement, approval for distribution of proceeds from a property sale, and permission for a creditor to sell certain vehicles.

The court approved the distribution of Chehalis property proceeds to Roynat.

For the Regions vehicles, the court granted the order allowing Regions to take possession, setting a 30-day retrieval period and approving storage costs of $35/day.

The motion for approval of the JD Factors Purchase Agreement was adjourned to a later date, as Mitsubishi HC Capital Canada Inc. objected, claiming ownership of the receivables and requiring more time to prepare its position.

In a Companies' Creditors Arrangement Act (CCAA) proceeding, the applicants sought court approval for the sale of a real property, the Monitor's reports, a revised governance protocol, and a sale and investor solicitation process (SISP) for their logistics business.

The court approved the property sale, finding it met the Soundair Principles despite not being a court-supervised process.

The Monitor's reports and activities were also approved.

The proposed SISP was approved with a minor amendment requiring the Monitor to consult directly affected secured creditors.

The Revised Governance Protocol, which included default commission rates for vehicle sales and collections, was approved as an interim measure, balancing the need for cost recovery with creditor concerns, noting that financiers could negotiate alternative rates or withhold consent to sales.

The applicants, Pride Group Holdings Inc. et al., sought an amended and restated initial order under the CCAA, including an extension of the stay period, approval of a debtor-in-possession (DIP) facility, elevation of charge priorities, confirmation against set-off, and approval of governance, real estate monetization, and intercompany/unsecured claims preservation protocols.

The court granted the requested stay extension to June 30, 2024, approved the $30 million DIP facility, and approved all proposed protocols.

The court declined to add an exception to the paramountcy provision as requested by certain securitization funders and approved a carve-out for Triumph Business Capital but limited it to CDN $3 million.

PricewaterhouseCoopers Inc. (PwC), as the court-appointed Liquidator of Silicon Valley Bank (SVB) Canada, sought court approval for the sale of the Clearco Credit Facilities, a sealing order for confidential transaction documents, and approval of its activities, fees, and disbursements.

The court applied the Soundair Principles to evaluate the sale, finding that the Liquidator made sufficient efforts to obtain the best price and that the process was fair and efficacious.

The Clearco Transaction, which provided the highest value for the assets, was approved.

A sealing order was granted for the confidential appendices due to their commercial sensitivity and potential negative impact on the ongoing sales process and future recoveries, with an unusual extended duration.

The Liquidator's activities, fees, and disbursements were also approved as appropriate given the complexity of the matter.

Carillion Canada Inc. brought a motion within its CCAA proceedings for an order directing HSBC Bank Canada to return $6.8 million that HSBC had unilaterally debited from Carillion's operating account to set off obligations under letters of credit.

The court found that while HSBC breached the initial stay order by exercising self-help without seeking leave, the funds were legally available for set-off.

Applying the Supreme Court's guidance in Montréal, the court held that HSBC's claim was a valid 'pre-pre' set-off preserved under section 21 of the CCAA.

The motion was dismissed, but HSBC was ordered to pay $50,000 in costs due to its conduct in breaching the stay.

In a CCAA proceeding, the Monitor sought leave to appeal an order dismissing its motion for a declaration that funds swept into a UK bank account were subject to a statutory trust under the Construction Lien Act.

The CCAA judge had found the funds were irreconcilably commingled and could not be traced.

The Court of Appeal refused to admit fresh evidence and denied leave to appeal, finding the proposed appeal was not prima facie meritorious and the decision was fact-specific and consistent with established jurisprudence regarding tracing.

The court addressed the issue of who should pay costs previously awarded after dismissing a motion brought by Bending Lake Iron Group Limited (BLIG).

The BLIG motion was deemed an abuse of process, a collateral attack on prior orders, and res judicata, with BLIG lacking standing due to its bankruptcy.

The court ordered that the costs be paid jointly and severally by BLIG's lawyer, Robert MacRae, and its directors and officers (Henry Grant Wetelainen, J. Chris Bailey, Dawn Elaine Mackay-Daynes, and Henry Clayton Wetelainen), citing the broad discretion under the Bankruptcy and Insolvency Act and Rule 57.07 of the Rules of Civil Procedure for personal costs against lawyers.

The Monitor in the CCAA proceedings of Nortel Networks Corporation brought a motion to pass its accounts and those of its legal counsel for the period from January 2009 to May 2016.

The fees sought totaled over $250 million CAD and USD combined.

The court applied the Belyea factors to assess the fairness and reasonableness of the fees.

Despite the unprecedented size of the fees, the court found them justified given the massive scale, complexity, and duration of the cross-border insolvency, the extraordinary powers granted to the Monitor, and the highly successful results achieved for the Canadian estate.

The accounts were approved in full.

The moving party, a debtor company in receivership, sought leave to appeal an order approving the sale of its assets by a court-appointed receiver.

The moving party argued that the receiver acted unfairly, that the debtor's management retained the right to negotiate a restructuring, and that the receiver failed to consult with affected Aboriginal communities.

The Court of Appeal dismissed the application for leave to appeal, finding that the debtor's parallel negotiations contravened the receivership order, the receiver had exclusive authority to market the assets, and the Aboriginal consultation issue was raised too late and lacked an adequate evidentiary record.

The United Steelworkers Local Union 2251, supported by USW Local 2724 and Essar Algoma retirees, brought a motion to qualify a "Subject Bidder" as a Phase II Bidder in a Companies' Creditors Arrangement Act (CCAA) proceeding.

The Subject Bidder had been disqualified by Essar Algoma, its Chief Restructuring Advisor, Financial Advisor, and the Monitor for failing to provide satisfactory evidence of financial capability to consummate a transaction.

The union argued it was not properly consulted in the disqualification decision and that it should have been allowed to meet with the Subject Bidder.

The court dismissed the motion, finding that the union's consultation rights under the Sale and Solicitation Process (SISP) did not extend to decisions on a bidder's financial capability, and that the court should not second-guess the business judgment of the CCAA applicants and their professionals.