John T. Porter

The applicant, a dissenting shareholder in a corporate amalgamation, applied to the court to fix a fair value for his shares under s. 185 of the Business Corporations Act.

The respondent argued the application was out of time, but the court exercised its discretion to extend the deadline.

The court rejected the applicant's claimed value based on an informal statement by the CEO, as well as the respondent's heavily discounted offer.

Relying on the implied share value from the amalgamation exchange ratio, the court fixed the fair value at $0.236 per share, awarding the applicant $271,400 plus partial indemnity costs.

The plaintiffs in a class action sought court approval for a settlement agreement with certain defendants, class counsel fees and disbursements, and honorariums for the representative plaintiffs.

The settlement amount was $37 million.

The court approved the settlement, finding it fair and reasonable given the litigation risks, including dissolved corporate entities and limitations issues.

The court also approved the 30% contingency fee for class counsel and $50,000 honorariums for each representative plaintiff, recognizing their exceptional involvement and exposure to costs.

In a CCAA proceeding, the Functionary and Terra Firma brought a motion to late file a claim and to approve a settlement agreement between them regarding the distribution of the debtor's funds.

The court allowed the late filing of the claim but ruled the Functionary's unsworn report inadmissible.

The court dismissed the motion to approve the settlement, finding that a settlement of claims against the debtor requires the consent of the debtor or the Monitor, neither of which had agreed to the settlement.

A family-owned meat processing business went bankrupt, terminating approximately 800 employees.

Two representative actions were commenced: one by Sam Caetano for unionized employees and another by Debbie and Alex Abreu for non-unionized employees, alleging wrongful dismissal, common employment, conspiracy, and oppression against solvent related companies and individuals.

The defendants brought motions to stay the Caetano action for lack of jurisdiction and to dismiss both representative actions as time-barred.

The court granted the jurisdiction motion, staying the Caetano action entirely, finding that claims by unionized employees under a collective agreement fall within the exclusive jurisdiction of labour tribunals.

The court also granted in part the limitations motion, dismissing the Caetano representative action as time-barred because the required Rule 12.08 representation order was not obtained prior to commencement.

However, the Abreu representative action, brought under Rule 10.01, was found not to be time-barred, but was allowed to proceed only on the condition that the plaintiffs forthwith obtain a representation order.

Following dismissal of a motion seeking production of documents in insolvency proceedings under the Companies’ Creditors Arrangement Act, the court determined the quantum of costs payable to the successful parties.

Applying the reasonableness principle and the factors in Rule 57.01 of the Rules of Civil Procedure, the court assessed costs claimed by the monitor, the creditors’ committee, and the applicants.

The court rejected arguments that certain participants should receive reduced or no costs and instead fixed reasonable amounts reflecting their participation in the motion.

Costs were awarded to each successful party and ordered payable within 30 days.

In the context of CCAA proceedings, the moving party sought an order requiring the Monitor to disclose all information and documents it considered when reviewing proofs of claim submitted by another creditor group.

The moving party intended to use this information at a claims hearing to argue that the claims officer should apply the same standard of proof used by the Monitor.

The court dismissed the motion, finding that the roles of the Monitor and the claims officer under the claims procedure order were fundamentally different, and the request constituted an impermissible collateral attack on that order.

Furthermore, the court noted that comparing claims would result in an unnecessary trial within a trial and risk disclosing confidential lending practices.

On a motion by a major contingent creditor to set aside an Initial Order under the CCAA, the court held that the applicant corporation, whose only asset was its partnership interest in an insolvent accounting partnership facing massive legacy negligence claims, was insolvent when contingent liabilities and defence costs were properly considered.

The court declined to deny CCAA relief based on allegations about historical litigation misconduct, holding that the relevant good faith inquiry concerns conduct within the CCAA proceeding itself.

The stay was properly extended to the partnership and its insurers because their affairs were inextricably intertwined with the debtor and a global resolution of the Castor litigation would be significantly impaired without that protection.

The court also upheld the creditors’ committee and CLCA’s ability to fund its reasonable legal fees as part of the negotiated restructuring framework.

Following dismissal of a motion brought by a creditor in a Companies’ Creditors Arrangement Act proceeding, the applicants sought costs on a substantial indemnity basis.

The court rejected the request for substantial indemnity costs, finding that references to possible fraud during submissions and cross‑examination did not amount to pleaded or proven allegations warranting elevated costs.

The applicants sought partial indemnity costs based on rates derived from the Costs Subcommittee practice direction with inflation adjustments.

The court noted that the recommended rates in the practice direction were outdated and unrealistic for major Toronto litigation but nevertheless accepted the claimed partial indemnity rates as reasonable in the circumstances.

Costs were awarded to the applicants in the amount claimed.

Minatura brought a motion to remove Aburi Goldfields Ghana Ltd. from the CCAA proceedings of the applicants, arguing lack of disclosure, that Aburi was not a debtor, and that the dispute over control of Aburi should be litigated in Ghana.

The court dismissed the motion, finding that Aburi was a debtor, that there was no material non-disclosure, and that staying the CCAA proceedings would likely cause the restructuring to fail.

Applying the Van Breda framework and giving weight to a forum selection clause in the parties' shareholders' agreement, the court held that Ontario had jurisdiction and that Minatura failed to establish that Ghana was a more appropriate forum.

In CCAA proceedings involving a mining company, competing motions were brought concerning the restructuring process.

The debtor sought directions regarding the procedure for resolving noteholder claims and the alleged misuse of confidential information by certain creditors, while the noteholders sought an order convening a meeting of creditors to vote on their proposed plan of arrangement.

The court held that calling a creditors’ meeting was premature because the proposed plan conflicted with the debtor-in-possession financing facility, had been introduced without meaningful consultation, and unresolved claims and litigation issues could affect voting rights and recoveries.

The court dismissed the noteholders’ motion without prejudice and declined to order disclosure sought by the debtor.

The stay of proceedings was extended to facilitate continued negotiations and mediation.

Following dismissal of the defendants’ motion for summary judgment, the court determined the appropriate costs award.

The plaintiffs sought substantial indemnity costs on the basis that the motion was unreasonable, while the defendants argued for a reduced partial indemnity award and challenged several disbursements.

The court held that the motion was not unreasonable or brought in bad faith and declined to award substantial indemnity costs under Rule 20.06.

Costs were limited to steps taken after the plaintiffs amended their claim to include fraud-related allegations, which ultimately led to their success on the motion.

The court excluded the plaintiffs’ expert fee and certain other disbursements, and fixed partial indemnity costs at $30,000 inclusive of disbursements and taxes.

The defendants brought a motion for summary judgment on their counterclaim for the balance of the purchase price under a share purchase agreement and to dismiss the plaintiffs' action.

The plaintiffs alleged fraudulent misrepresentation regarding the financial position of the purchased company and sought rescission.

The court found that there was some evidence to support the plaintiffs' claims and that issues of credibility and fact, particularly regarding when the plaintiffs became aware of the alleged fraud and whether they affirmed the contract, required a full trial.

The motion for summary judgment was dismissed.

The Chapter 11 Debtors brought a motion under section 49 of the CCAA for recognition and implementation of several orders made by the U.S. Bankruptcy Court, including a Final DIP Facility Order.

The Information Officer noted that the Final DIP Facility Order contained a partial 'roll up' provision that would not be permissible under section 11.2 of the CCAA in a domestic proceeding.

The court held that recognition of the foreign orders was necessary for the protection of the debtors' property and creditors' interests, and that the public policy exception under section 61(2) of the CCAA should be interpreted restrictively and did not apply to prevent recognition.

On an unopposed insolvency motion under Part III of the Bankruptcy and Insolvency Act, the moving parties sought sanction of an amended consolidated proposal with substantive consolidation and a broad third-party release.

The court applied the section 59(2) reasonableness-and-benefit test, considered good faith and creditor voting support, and accepted that the proposal met statutory requirements.

The court held that third-party releases were permissible in the circumstances and interpreted the statute harmoniously with restructuring principles applied under related insolvency legislation.

Applying the Metcalfe criteria, the court found the release was necessary, supported by tangible contributions, and beneficial to creditors generally compared with bankruptcy alternatives.

The sanction order was granted.

The appellants appealed a trial judge's finding that the deceased's surviving husband was the beneficial owner of certain corporate shares, despite the deceased's estate being the legal owner.

The appellants argued this required a finding of fraud or an express trust.

The Court of Appeal dismissed the appeal, holding that under the Business Corporations Act, beneficial ownership is not limited to ownership through a formal trustee and can exist without fraud.

The court found the deceased was implicitly a bare trustee for her husband, who had absolute control of the shares.

The court also rejected arguments that the action was barred by the Trustee Act limitation period, as no personal wrong was alleged against the deceased.

The appellant appealed an order finding its bid in a receivership sale process to be invalid.

The Court of Appeal dismissed the appeal, agreeing with the motion judge that the agreed process required parties to submit their final and best offer by a specified date and that the bids were to remain confidential.

As such, an auction was not contemplated, and the appellant's bid was properly ruled invalid.

The Supreme Court of Canada considered a proposed plan of arrangement for a leveraged buyout of BCE Inc. that would add substantial debt to Bell Canada, reducing the trading value of its debentures.

The debentureholders opposed the arrangement, claiming oppression under s. 241 of the CBCA and arguing the arrangement was not fair and reasonable under s. 192.

The Court held that the directors' fiduciary duty is owed to the corporation, not to specific stakeholders, though directors may consider stakeholder interests.

The debentureholders failed to establish a reasonable expectation that their investment grade rating would be maintained.

The Court affirmed the trial judge's approval of the arrangement, finding it had a valid business purpose and resolved objections in a fair and balanced way.

Appeals and cross-appeals arising from the collapses of two airlines operating leased aircraft and leaving substantial unpaid airport and civil air navigation charges.

The Court held that legal titleholders were not personally liable for unpaid navigation charges under s. 55 of the Civil Air Navigation Services Commercialization Act because 'owner' was limited to persons with legal custody, control, or possession in the statutory context.

However, the seizure and detention remedies under s. 56 of that Act and s. 9 of the Airport Transfer (Miscellaneous Matters) Act operated against aircraft owned or operated by the defaulting airlines and could not be defeated by leasing arrangements or by separating attached engines.

The remedies extended to security posted in substitution for the aircraft, subject to the motions judges’ supervisory discretion to craft fair terms.

Interest continued to run until payment, posting of security, or bankruptcy.

The appellants, a secured creditor and an interim receiver, appealed a decision granting priority to carriers over funds collected by a bankrupt freight broker.

The broker had failed to maintain a separate trust account for carriers' charges as required by provincial regulation, instead co-mingled the funds while tracking them in an accounting system.

The Court of Appeal held that provincial statutory deemed trusts do not exclude property from a bankrupt estate unless they satisfy general trust principles, which require strict segregation.

Consequently, the co-mingled funds collected before the receivership lost their trust character and were subject to the secured creditor's interest.

However, the interim receiver was obligated to hold funds collected after its appointment in trust for the carriers.

The respondents, having been largely successful on the main appeals concerning the interpretation of seizure and detention remedies under the Airport Transfer (Miscellaneous Matters) Act and the Civil Air Navigation Services Commercialization Act, sought costs totaling over $631,000.

The court declined to award costs to any party.

The court reasoned that the proceedings raised novel issues of statutory interpretation that engaged the public interest, the respondents were not completely successful as their cross-appeals were dismissed, and the appellant airport authorities acted reasonably in bringing the appeals given the lack of established jurisprudential authority.