Markus Koehnen

The applicants, dissident shareholders engaged in a proxy contest, sought a hearing and review of a Toronto Stock Exchange (TSX) decision that conditionally approved the issuance of shares by Eco Oro Minerals Corp. to certain shareholders without requiring a shareholder vote.

The TSX permitted an accelerated closing of the share issuance just days before the record date for a requisitioned shareholder meeting.

The Ontario Securities Commission conducted a de novo review, finding that the TSX overlooked material evidence regarding the proxy contest and erred in its interpretation of 'materially affect control.' The Commission set aside the TSX decision, concluding that the share issuance materially affected control and required shareholder approval.

To remedy the improper issuance, the Commission ordered Eco Oro to hold a shareholder vote to either ratify or reverse the share issuance, cease-traded the new shares pending the vote, and prohibited the new shares from being voted at the upcoming meeting.

The plaintiffs, a grain elevator business and a seed business, sued their bank for refusing to advance funds to pay margin calls on their grain hedges.

The bank's refusal forced the plaintiffs to liquidate their hedges at a significant loss.

The plaintiffs argued the bank was required to give reasonable notice before refusing to advance funds, based on contract, negligence, and fiduciary duty.

The Superior Court of Justice dismissed the action, finding that the plaintiffs were in default of their loan agreements and overdrawn on their credit limits.

The court held that the bank had no contractual obligation to extend further credit, nor was there an implied term, duty of care, or fiduciary duty requiring the bank to provide reasonable notice before refusing to fund the margin calls.

The applicant filed a human rights complaint alleging discrimination based on ancestry, colour, and ethnic origin regarding the use of the Cleveland baseball team's name and "Chief Wahoo" logo during games and broadcasts in Ontario.

The Tribunal issued a Notice of Intent to Defer the application pending another proceeding.

The Tribunal determined that deferral was not appropriate because an injunction application had already been decided and a related federal human rights complaint raised jurisdictional issues that needed to be resolved first.

The Tribunal issued directions and a schedule for the parties to make submissions on the preliminary jurisdictional issues.

The applicant, an Indigenous person, sought an urgent interim and interlocutory injunction to restrain the broadcast and display of the Cleveland Indians' team name and 'Chief Wahoo' logo during the American League Championship Series in Toronto, pending human rights complaints.

The court found there was a serious issue to be tried regarding whether the name and logo constituted discrimination in the provision of a service.

However, the court dismissed the application because the applicant failed to establish irreparable harm, noting the delay in bringing the application, and found the balance of convenience favoured the respondents due to the material prejudice of last-minute broadcast and uniform changes.

The moving parties sought directions on whether they required leave to appeal an order made by a CCAA judge dismissing their jurisdictional challenge to a contract dispute motion brought by the responding parties.

The moving parties also sought a stay of the contract dispute motion pending their appeal.

The responding parties brought a cross-motion to expedite the hearing of the leave to appeal motion.

The Court of Appeal held that the CCAA judge's order was 'made under' the CCAA, meaning leave to appeal was required under s. 13.

The Court expedited the leave to appeal motion and granted a stay of the contract dispute motion pending the determination of the leave motion, finding that the balance of convenience favoured a stay.

In a CCAA restructuring proceeding, the moving parties (Cliffs) brought a motion objecting to the jurisdiction of the Ontario Superior Court to hear a dispute over a terminated iron ore supply contract.

Cliffs argued that the contract was governed by Ohio law and that Ohio was the convenient forum.

The court dismissed the motion, finding that it had jurisdiction simpliciter because the contract was made in Ontario and Cliffs carried on business in Ontario.

Applying the single control model for insolvencies, the court held that the dispute should be resolved within the CCAA proceedings.

The court also found that Cliffs failed to establish that Ohio was clearly a more appropriate forum.

During the 117th day of a protracted hearing on the merits, four respondents brought a motion requesting permission to file written witness statements in lieu of oral examinations-in-chief for their remaining witnesses.

The respondents argued this was necessary to ensure the hearing concluded by the scheduled deadline and to prevent the exhaustion of their funding, relying on the Supreme Court's direction in Hryniak regarding proportionality and access to justice.

Staff opposed the motion, arguing that credibility was at issue and written statements would provide a 'varnished version' of the facts.

The Panel granted the motion, finding that the slight prejudice to Staff in not observing the witnesses during examination-in-chief was outweighed by the necessity to complete the hearing efficiently and the significant costs already incurred by all parties.

The plaintiffs brought a motion arising from a dispute over the conduct of examinations for discovery, specifically whether the plaintiff could attend the defendant’s discovery and the order in which discoveries should occur.

The action alleged misrepresentation and fraud relating to investments connected to speaking engagement events and an alleged IPO opportunity.

The court considered the principles governing exclusion of a party from attending an opposing party’s examination for discovery, including the requirement of “proper cause” and the risk of tailoring evidence where credibility is central.

Given evidence suggesting credibility would be a critical issue and concerns regarding potential tailoring of testimony, the court concluded that the interests of justice justified limiting attendance until one party had completed examination.

The plaintiff’s request to strike the defence and related relief was rejected, and directions were provided for how the discoveries should proceed.

The applicant sought a temporary cease trade order against an insider bid made by the respondent, alleging the respondent failed to obtain a formal valuation as required by MI 61-101.

The applicant argued the respondent possessed undisclosed material information, specifically confidential power purchase agreement pricing and wind speed data.

The Commission found the applicant failed to provide prima facie evidence that the information was material, noting the applicant's own Directors' Circular stated there was no undisclosed material information.

The Commission dismissed the request for a temporary cease trade order and granted the respondent's cross-motion to dismiss the application.

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.

In CCAA proceedings, the debtor sought approval of a claims procedure order establishing a process for identifying and determining claims against the company and its current and former officers and directors.

Noteholders opposed aspects of the proposed order, including provisions granting the debtor broad set‑off rights, the absence of creditor consent for large claims, and the ability to appoint a claims officer without court approval.

The court held that creditors should not have a veto over claims exceeding $100,000 but ordered a compromise requiring notice to stakeholders before acceptance of claims exceeding approximately $2.5 million.

The court further ruled that proposed set‑off provisions improperly affected substantive rights and should not appear in a claims procedure order.

The draft order was required to remove those provisions and to provide that appointment of a claims officer requires court approval.

The Court of Appeal issued a costs endorsement following an appeal in CCAA proceedings.

The appellant, Computershare Trust Company of Canada, was ordered to pay costs of the appeal to the respondent Crystallex International Corporation in the amount of $110,688.00, and to the respondent Tenor Capital Management Company, L.P. and Affiliates in the amount of $80,000.

Both amounts are inclusive of disbursements and HST.

The appellant Noteholders appealed orders approving a bridge loan, a $36 million DIP financing facility, and a Management Incentive Plan (MIP) for the respondent debtor under the CCAA.

The debtor's principal asset was a $3.4 billion arbitration claim against Venezuela.

The Noteholders argued the DIP financing, which could outlast the CCAA protection period and granted the lender a 35% interest in the arbitration proceeds, was effectively an arrangement requiring creditor approval.

The Court of Appeal dismissed the appeal, finding that the supervising judge reasonably exercised his broad discretion under s. 11.2 of the CCAA to approve the financing necessary to pursue the arbitration, and that the financing did not constitute a plan of arrangement.

In Companies’ Creditors Arrangement Act proceedings, the debtor sought approval of a debtor-in-possession financing facility, an extension of the stay of proceedings, approval of a management incentive plan, and approval of the monitor’s actions.

Certain noteholders opposed the proposed financing and incentive plan and proposed an alternative short-term DIP facility intended to maintain the status quo pending negotiation of a restructuring plan.

The court held that the debtor’s board had exercised reasonable business judgment after a competitive process and that the proposed financing satisfied the statutory considerations under s. 11.2 of the CCAA.

The court rejected the argument that the DIP facility constituted a de facto plan of arrangement requiring creditor approval and found the alternative financing proposal tactical and inconsistent with market conditions.

The management incentive plan was also approved as reasonable and necessary to retain key personnel responsible for pursuing a significant international arbitration claim forming the debtor’s primary asset.

In Companies’ Creditors Arrangement Act proceedings, the debtor sought approval of short‑term bridge financing pending a larger DIP financing facility.

Competing bridge financing proposals were advanced by an existing lender and by noteholders.

The court approved the debtor’s preferred proposal despite it being more expensive, holding that the board’s decision was protected by the business judgment rule and was supported by the debtor’s financial advisor and the monitor.

A cross‑motion by noteholders seeking revisions to the DIP auction procedures and exemption from signing a non‑disclosure agreement was largely dismissed, though the deadline for qualification as a bidder was briefly extended.

The appellant, acting as trustee for noteholders, appealed the dismissal of its application against the respondent mining corporation.

The appellant argued that the respondent's failure to obtain foreign environmental permits triggered a 'Project Change of Control' under the trust indentures, and that the respondent improperly sold equipment purchased with note proceeds.

The appellant also sought an oppression remedy under the Canada Business Corporations Act, arguing the respondent was insolvent and its directors should have prioritized creditor interests.

The Court of Appeal dismissed the appeal, finding no breach of the trust indentures and upholding the application judge's conclusion that the directors' business decisions were reasonable and did not constitute oppression, even in the context of financial distress.

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.

The appellants appealed a decision dismissing their claim to wind up two family-owned companies under s. 207 of the OBCA.

The appellants argued that irreconcilable differences and a mutual loss of confidence required the court to intervene.

The Divisional Court dismissed the appeal, finding no palpable and overriding error in the motions judge's conclusion that the appellant had no reasonable expectation that the business would be wound up or that he would continue to exercise de facto control.

The plaintiffs, assignees of a bankrupt Ontario corporation, brought actions against two Iranian state-owned oil and drilling companies for breach of contract, conversion, and conspiracy arising from oil drilling operations in Iran.

The defendants appealed the dismissal of their motions to stay the actions for want of jurisdiction.

The Court of Appeal allowed the appeals in part, staying the action against the oil company based on a forum selection clause in favour of Iran, and staying part of the action against the drilling company for lack of a real and substantial connection to Ontario.

The court allowed the claim based on a 1998 contract to proceed in Ontario due to a valid forum selection clause in favour of Ontario.

The defendant moved for leave to appeal a decision refusing to strike out an affidavit submitted by the plaintiffs.

The defendant argued the affidavit was improper sur-reply and constituted case-splitting, relying on trial evidence rules.

The court dismissed the motion, finding no conflicting decisions and no good reason to doubt the correctness of the motion judge's decision.

The court affirmed that the strict evidentiary rules against case-splitting at trial do not apply to the filing of affidavits on motions under Rule 39.02.