In CCAA proceedings arising from a major construction project, the monitor sought an order authorizing release of a contractor-specific holdback notwithstanding the continued construction of the project and the resulting technical inability to satisfy the timing requirements of the construction lien regime.
The court held that s. 11 of the CCAA gave it jurisdiction to deem compliance with statutory preconditions where doing so usefully furthered the remedial objectives of the restructuring, caused no demonstrated prejudice, and preserved the substantive rights of affected stakeholders.
The court also held that it could protect the monitor and CRO from potential personal liability under specified tax statutes for implementing the court-authorized payment, but revised the proposed wording to grant a narrower and more direct liability shield.
The holdback release order was approved with modifications, including removal of an unnecessary overlapping protection.
