Lisa Susan Corne

The Monitor, FTI Consulting Canada Inc., brought a motion for an approval and vesting order in respect of the Purchased Assets and the sale thereof to Vault or an affiliate pursuant to the Rifco Asset Purchase Agreement, and for a stay extension order.

The Court approved the Rifco APA and the AVO, finding the process reasonable, the requirements of the Companies' Creditors Arrangement Act satisfied, and the transaction in the best interests of stakeholders.

The stay extension was also granted.

The applicant, Canadian Western Bank, sought a contempt order against Abdul Muqeet, the sole officer and director of the respondent companies in receivership, for failing to comply with court orders to provide information and attend examinations.

Justice Black found Muqeet in contempt.

This decision concerns the sentencing phase.

The court considered the principles of civil contempt sentencing, emphasizing coercion and upholding court authority.

Despite Muqeet's eventual, albeit delayed, compliance with most requests, his persistent non-compliance and impecuniosity led the court to impose a five-day jail term, finding a fine inappropriate.

No further costs were awarded due to the unlikelihood of payment.

The Moving Parties brought a jurisdiction motion seeking to dismiss or stay Senvion's Ontario action and motion for lack of jurisdiction or on the basis of forum non conveniens, arguing that Quebec was the more appropriate forum.

Senvion's proceedings concerned an alleged breach of a Companies’ Creditors Arrangement Act (CCAA) stay order issued by the Ontario court, specifically regarding the draw down of a letter of credit.

The court dismissed the Moving Parties' motion, holding that the Ontario court, as the issuer of the CCAA recognition orders and stay, was the appropriate forum to determine whether its order had been breached, irrespective of contractual choice of law or forum clauses.

The court explicitly stated it was not making a determination on the merits of the stay violation.

The Receiver, PricewaterhouseCoopers Inc., sought court approval for an asset purchase agreement (APA) and ancillary relief, including approval of its reports, interim statement, sealing of a confidential report, and fees.

The Debtor, 2563773 Ontario Inc., sought an adjournment to allow an unsuccessful bidder (810) to firm up financing for a higher offer.

The court denied the adjournment, deferring to the Receiver's judgment that the selected APA, though lower in price, offered greater certainty and was in the best interests of all stakeholders given the Debtor's history of delays and the unsuccessful bidder's lack of firm financing.

The court approved the APA, the Receiver's reports and activities, its fees, and the sealing order.

The applicant, Romspen Investment Corporation, sought the appointment of a receiver over the respondents' property and approval of an agreement of purchase and sale (the "Times Transaction").

A fifth-ranking mortgagee, Sow Capital Ontario Limited, brought a competing motion to approve its own power of sale transaction (the "281 Transaction") and sought to suspend the receiver's powers.

The respondents opposed both sale transactions, arguing for a receiver-conducted auction.

The court appointed Ernst & Young Inc. as receiver, approved the Times Transaction, and granted a sealing order, finding that the Times Transaction offered the best outcome for all stakeholders and that a further sales process was unnecessary.

The court dismissed Sow's motion to suspend receivership powers and the respondents' request for an auction or a reservation of rights to claim improvident sale.

The Canadian Western Bank (CWB) applied for the appointment of a receiver over the assets of 2563773 Ontario Inc. (the Respondent), a hotel property, due to a secured loan default.

The Respondent sought to dismiss or adjourn the application, citing a pending agreement for the sale of the property that would pay out the indebtedness.

The court applied the "just or convenient" test for receiver appointment under the Bankruptcy and Insolvency Act and the Courts of Justice Act.

Despite the Respondent's efforts, the court found that the prolonged default, the Respondent's failure to comply with a forbearance agreement (specifically regarding priority payables like HST and property taxes), and the uncertainty surrounding the proposed sale agreement (due to inaccurate representations and refusal to secure a deposit) warranted the immediate appointment of a receiver.

The application was granted, and PricewaterhouseCoopers Inc. was appointed as receiver.

Santokh Mahal sought a declaration that his security interest in Golden Miles Food Corporation's personal property was valid and had priority, securing $2,182,914 in advances.

The Applicant, Skymark Finance Corporation, and the Receiver, KSV Restructuring Inc., opposed the motion.

The court granted Mahal a secured claim for $281,600, representing direct personal advances, but dismissed the remaining $1,901,314 claimed for advances made by corporations controlled by Mahal.

The court found that these corporate advances were not indirect debts secured by Mahal's General Security Agreement due to insufficient documentation and lack of PPSA registration by the advancing corporations.

The Applicants in a CCAA proceeding sought approval of an amended Share Purchase Agreement (SPA) and a reverse vesting order (RVO) to facilitate the sale of their business as a going concern.

The transaction aimed to preserve cannabis licenses, maintain business operations, and retain approximately 95% of employees.

The motion was unopposed, receiving strong support from the two senior secured creditors (2125028 Ontario Inc. and Marzilli) and the Monitor.

The court found the RVO appropriate, satisfying the factors under CCAA section 36, the Soundair Principles, and the Harte Gold framework.

Ancillary relief, including third-party releases for parties crucial to the restructuring, such as the stalking horse bidder (Cardinal) who provided interim financing and waived fees, was also granted.

The stay period was extended to allow for post-closing matters.

The appellant appealed an order enforcing a Settlement Agreement requiring payment of USD $200,000 upon satisfaction of a condition regarding the withdrawal of criminal charges in Panama.

The motion judge interpreted the condition as satisfied when the prosecutor provided written confirmation that charges were discontinued, despite an outstanding detention order/arrest warrant.

The appellant argued the motion judge misapprehended evidence and that the condition required both dismissal of charges and withdrawal of the detention order.

The Court of Appeal upheld the motion judge's interpretation, finding no error in the textual analysis of the Settlement Agreement and rejecting the appellant's application to adduce fresh evidence.

The respondent appealed a motion judge's order dismissing his motion to compel the moving party to answer discovery questions regarding a pattern of commercially unreasonable conduct.

The respondent had pleaded that the moving party's conduct toward his company was part of a broader pattern of conduct toward multiple borrowers.

The motion judge held the questions were not relevant because the respondent failed to demonstrate sufficient similarities.

The Court of Appeal held the order was interlocutory and the appeal was brought to the wrong court, as appeals of interlocutory orders lie to the Divisional Court with leave.

The appeal was quashed and costs were awarded to the moving party.

The applicants, first mortgage holders, sought an order for three months' interest under s. 17 of the Mortgages Act or their mortgage terms, after their mortgaged properties were sold by a court-appointed receiver.

The court dismissed the application, holding that s. 17 does not apply to payments of sale proceeds by a court-appointed receiver to a secured creditor.

A receiver is not a "person entitled to make such payment" under s. 17, nor is it an agent of the debtor or subsequent mortgagee.

The court found no material distinction between private and court-appointed receivers for the purpose of s. 17, emphasizing the provision's historical intent to protect mortgagors seeking relief from forfeiture, not to benefit mortgagees realizing on security.

The appellant, a personal guarantor of corporate indebtedness, appealed a summary judgment awarding the respondent lender US$3 million plus interest at 21% on his personal guarantee.

The guarantor had negotiated an amended guarantee that excluded facility and forbearance fees totaling US$2.75 million from his liability.

The lender acquired the company's assets through a receivership sale, with the purchase price calculated as total debt less US$3 million.

The Court of Appeal found that the motion judge erred by failing to consider that the amended guarantee served to reduce the company's obligations that were guaranteed.

The court held that the guarantor's liability should be calculated as the remaining debt after the credit bid (US$3 million) less the excluded fees (US$2.75 million), resulting in liability of only US$250,000.

The union sought leave to proceed with a certification application and unfair labour practice complaint before the Ontario Labour Relations Board following the appointment of a receiver over the debtor company.

The motion judge dismissed the union's motion, finding that the stay imposed by the receivership order prevented the certification application from proceeding and that the union could not pursue an unfair labour practice complaint without a valid certification application.

The Court of Appeal allowed the appeal, holding that the motion judge erred in refusing to lift the stay.

The court found that the motion judge's concerns about the certification application were speculative and unsupported by evidence, and that employees' labour rights should not be unduly inoculated against by insolvency proceedings.

The court granted leave to proceed with both the certification application and the unfair labour practice complaint.

The Monitor of Target Canada Co. and its affiliates, undergoing CCAA proceedings, sought advice and directions from the court regarding the treatment of several late-filed claims.

The court applied the four-part test from *Blue Range Resource Corp. Re*, considering inadvertence, good faith, and prejudice to other creditors.

The court found that five claimants (Fruits & Passion, Lou Pharma, Kulwinder Kaur Rai, Capital Brands Inc., and Mohammad Alam) satisfied the test, allowing their claims against Target Canada Co. However, claims against Target Corporation and Target Brands were barred due to the prejudice caused by disturbing the sanctioned plan and releases, which Target Corporation relied upon for its significant contributions.

The court also provided directions on distributions for allowed late claims and a framework for addressing future unknown late claims, emphasizing the finality of the sanctioned plan.

A motion was brought by 40 purchasers of residential units from various Urbancorp entities in CCAA and BIA NOI proceedings.

The purchasers sought the appointment of Dickinson Wright LLP as their representative counsel and an order for their legal fees, capped at $150,000, to be paid and secured by an administrative charge against the four properties.

The properties were vacant land, and the significant deposits received by Urbancorp companies were not held in trust and had been spent.

The motion was supported by Tarion but opposed by the Monitor, the Foreign Representative of Urbancorp Inc., the Urbancorp entities, and certain other purchasers and a secured lender for one project.

The court granted the appointment of Dickinson Wright as representative counsel, but stipulated an opt-in process for purchasers rather than an opt-out.

The court denied the request for an administrative charge for legal fees, ruling that fees and disbursements could be paid by the estates from the distributions made to those purchasers who chose to be represented by Dickinson Wright.

The plaintiff, Callidus Capital Corporation, moved for summary judgment to enforce a guarantee and mortgage against the defendant, Jeffrey J. McFarlane, for obligations of Xchange Technology Group LLC (XTG).

McFarlane had guaranteed XTG's debt to Callidus, limited to US$3 million, excluding certain facility and forbearance fees.

McFarlane argued that the debt was extinguished by an asset purchase agreement (APA) via a credit bid, and that Callidus had impaired its security.

The court found that the guarantee was a commercial agreement, not subject to the *contra proferentem* rule, and that the $3 million carve-out in the APA was intended to maintain McFarlane's guarantee obligation.

The court also rejected the impairment of security argument, noting a broad release signed by McFarlane.

Summary judgment was granted to Callidus for US$3 million plus interest and costs.

The International Union of Operating Engineers, Local 793 (the "Union") brought a motion seeking to lift a stay of proceedings imposed by a receivership order.

The Union intended to proceed with a certification application and a related unfair labour practice complaint before the Ontario Labour Relations Board (OLRB) against Courtice Auto Wreckers Limited (the "Debtor") and its court-appointed receiver, Rosen Goldberg Inc. The court denied the motion, finding that the certification application was a nullity as it was commenced without prior leave of the court, in contravention of the receivership order.

Consequently, the unfair labour practice complaint, being dependent on the validity of the certification application, also lacked a prima facie basis.

The court emphasized that allowing the certification would create new rights for employees, contrary to the purpose of a stay in receivership, and could diminish the proceeds from the sale of the Debtor's assets.