Morawetz

In the context of CCAA proceedings for Target Canada Co. and related entities, the applicant brought an unopposed motion to establish a streamlined process for identifying and resolving common issues among pharmacist claims.

The court granted the motion, noting the benefit of an expeditious and efficient procedure to resolve such disputes, and approved the modified fee arrangements subject to court approval.

The applicant, GuestLogix Inc., sought an initial order under the Companies' Creditors Arrangement Act (CCAA) for a stay of proceedings, the appointment of a Monitor, and authorization for super-priority charges.

The court found the applicant to be an insolvent debtor company with over $5 million in unsecured liabilities, making it eligible for CCAA protection.

The court granted the stay and the requested Administration and Directors' Charges.

However, due to a potential conflict of interest raised by a secured creditor, the court declined to appoint the proposed Monitor, Deloitte Restructuring Inc., and instead appointed PricewaterhouseCoopers Inc.

The Attorney General of Canada, at the request of the Superintendent of Financial Institutions, applied for a winding-up order under the Winding-up and Restructuring Act in respect of the Canadian business of an authorized foreign bank.

The bank had admitted insolvency following the emergence of significant German tax claims and the imposition of a moratorium by German regulators.

The court found that the Superintendent had ample basis to take control of the bank's Canadian assets under the Bank Act.

Given the bank's admitted insolvency and the appointment of a German insolvency administrator, the court concluded it was just and equitable to grant the winding-up order and appoint a liquidator.

The court addressed three issues regarding the distribution of proceeds from the sale of properties by a court-appointed Sales Officer.

The court approved the Sales Officer's recommendation to reduce the general reserve and distribute funds following the closing of two properties.

The court also directed that future costs of the Sales Officer be allocated to the sole remaining property.

Finally, the court declined to eliminate or reduce a $7.5 million Settlement Liquidity Holdback, maintaining it to ensure liquidity for accounting adjustments and to incentivize the parties to advance the long-standing family litigation.

The Applicants, operating a network of alternative financial services branches across Canada, sought initial protection under the Companies' Creditors Arrangement Act (CCAA) due to a severe liquidity crisis and regulatory challenges.

The court found the Applicants to be insolvent and granted a stay of proceedings to provide breathing space for restructuring.

The court confirmed its jurisdiction to hear the matter in Ontario, as the Applicants' chief place of business is located there.

However, the court deferred the request for a DIP financing charge to allow other stakeholders time to respond.

The applicant bank sought the appointment of a receiver over two corporate debtors and two residential properties owned by the individual guarantor following defaults on credit facilities.

The debtors opposed the appointment, arguing there was no urgency and that the guarantor was best positioned to sell the properties.

The court found it just and convenient to appoint a receiver over the corporate entities and a vacant residential property due to the ongoing erosion of security and the guarantor's failure to secure refinancing or a sale over two years.

However, the court declined to appoint a receiver over the guarantor's matrimonial home, finding it unnecessarily invasive and noting the bank could pursue other contractual remedies.

The Receiver brought an unopposed motion seeking approval of three asset purchase agreements to sell substantially all of the debtors' assets as a going concern in a 'quick flip' transaction.

The court applied the Soundair principles, finding that the sales process was fair, the market was sufficiently canvassed, and the transaction was the best available option to maximize recovery for the senior secured creditor.

The court also approved the use of a credit bid for partial payment and granted a sealing order for the purchase agreements and valuation reports to protect sensitive commercial information.

The applicant sought an order appointing Grant Thornton Limited as receiver of the respondents pursuant to section 243 of the Bankruptcy and Insolvency Act and section 101 of the Courts of Justice Act.

The respondents, operating a travel agency business, were insolvent and in default of their credit facilities.

The application was unopposed.

The court found it just and convenient to appoint the receiver to facilitate a going concern sale of the business, preserving consumer confidence and employee jobs.

Honeywell brought a motion in Comstock's CCAA proceedings seeking an order directing Comstock to disclaim a subcontract or, alternatively, lifting the stay of proceedings to allow Honeywell to terminate the subcontract.

Comstock had ceased performance on the construction project and stopped paying Honeywell.

The court held it could not force a disclaimer under section 32 of the CCAA without the Monitor's approval.

However, because Comstock was no longer actively involved in the project and it would not form part of the restructuring, the court lifted the stay of proceedings to allow Honeywell to pursue its options.

The court addressed three motions in a proceeding involving the sale of multi-unit residential buildings by a court-appointed Sales Officer.

The court approved the Sales Officer's activities, receipts, and post-appointment fees, but directed that pre-appointment fees be allocated between the Sales Officer mandate and the applicants who initially sought a broader receivership.

The applicants' motions for production of accounting records and for independent oversight of the interim distribution were largely deferred to a case conference, though the court ordered a $7,500,000 holdback from the distribution to ensure liquidity for future adjustments.

The applicants moved for an order regarding post-closing issues following a court-approved sale of properties.

The respondents sought payout on two mortgages, including compensation for future interest loss, as the mortgages were vested off title prior to maturity.

The applicants objected, arguing the mortgages were self-dealing and should not include an unbargained pre-payment penalty.

The court found that the mortgages did not contain a pre-payment privilege and that the respondents did not breach any fiduciary duty in the refinancing.

The court ruled in favour of the respondents, ordering that they be compensated for future interest loss.

The applicants moved for an order regarding post-closing issues following a court-approved sale of properties.

The respondents sought a payout on two mortgages that included a prepayment penalty for future interest loss.

The applicants argued the mortgages were self-dealing and should not include a prepayment penalty, as the original CMHC mortgages did not.

The court found that the mortgages did not contain a prepayment privilege and that the respondents were entitled to compensation for the loss resulting from the early vesting off title of the mortgages.

The court ruled in favour of the respondents.

The Canadian Debtors brought a motion for approval of an Allocation Protocol to determine the allocation of approximately $9 billion in sale proceeds among the global Nortel entities.

The EMEA Debtors opposed the motion and brought a cross-motion to compel arbitration, arguing the parties had agreed to arbitrate under the Interim Funding and Settlement Agreement.

The court dismissed the cross-motion, finding the agreement was merely an unenforceable agreement to agree.

The court granted the Canadian Debtors' motion, holding it had discretionary authority under the CCAA to approve the Allocation Protocol and that the parties had irrevocably submitted to the jurisdiction of the Canadian and U.S. courts.

The Ontario Plaintiffs brought a motion for approval of a $117 million settlement and release of claims against Ernst & Young LLP within the CCAA restructuring of Sino-Forest Corporation.

Several institutional investors objected, arguing that the settlement improperly extinguished their opt-out rights under the Class Proceedings Act and that the third-party release was not justified under the CCAA.

The court approved the settlement and release, finding them fair, reasonable, and rationally related to the restructuring plan.

The court held that claims compromised within a CCAA proceeding do not afford opt-out rights, and the settlement provided a substantial benefit to stakeholders.

The plaintiffs brought a motion for summary judgment against the defendants for fraud, breach of trust, breach of fiduciary duty, unjust enrichment, and breach of contract arising from a fraudulent investment scheme.

The court found the defendants liable on a joint and several basis, as the uncontested evidence established that the defendants accepted funds for investment but did not invest them as promised, instead providing forged financial statements.

The court awarded damages based on the net principal invested plus compound interest, general damages for investigation costs, and punitive damages.

In the context of CCAA proceedings for Priszm, the landlord (Scott's REIT) brought a motion claiming entitlement to the proceeds from the sale and assignment of various restaurant leases to third-party purchasers.

Scott's argued it had a proprietary interest in the lease consideration and that the secured creditor (Prudential) had subordinated its security interest to Scott's claim.

The court dismissed the motion, finding that the lease provisions created only an unsecured contractual obligation, not a proprietary interest.

Furthermore, the court held that the leasehold charge consents did not contain clear and unequivocal language demonstrating an intention by Prudential to subordinate its first-priority security interest to Scott's unsecured claim.

The applicant, Sino-Forest Corporation, sought an order sanctioning a plan of compromise and reorganization under the CCAA.

The plan was supported by the vast majority of creditors, including noteholders, auditors, and underwriters, but opposed by certain funds.

The court found that the statutory requirements were met, the creditors were properly classified, and the plan, including its third-party releases, was fair and reasonable.

The motion was granted and the plan was sanctioned.

In a CCAA proceeding, a former CEO moved for an order compelling the debtor company to continue paying his monthly consulting fees under a 1996 agreement.

The debtor company brought a cross-motion declaring the obligations were pre-filing obligations stayed by the Initial Order, or alternatively, seeking to disclaim the agreement under s. 32 of the CCAA.

The court held that the consulting fees were in substance termination or retirement benefits, constituting unsecured pre-filing obligations that were stayed.

Alternatively, the court found that disclaiming the agreement was advantageous to the restructuring and would not cause significant financial hardship to the former CEO.

A receiver was appointed over a fraudulent investment scheme where the deposits of 24 investors were commingled.

The receiver sought directions on how to distribute the remaining funds, which had a significant shortfall.

One group of investors argued for a pro rata distribution based on original contributions, while another argued for the Lowest Intermediate Balance Rule (LIBR).

The court held that LIBR is the general rule for resolving competing claims to commingled funds unless it is unworkable.

Finding that the receiver could practically calculate the LIBR distributions, the court ordered the funds to be distributed according to LIBR.

The applicants, facing severe liquidity issues and unable to meet financial covenants, sought protection under the Companies' Creditors Arrangement Act (CCAA).

The court found the applicants met the statutory definitions of 'company' and 'debtor company' and that a stay of proceedings was necessary to allow them to maintain operations and complete a sales process.

The court granted the Initial Order, which included the appointment of a Chief Restructuring Officer, approval of a DIP facility, various priority charges (Administration, Critical Supplier, Directors', and DIP Lenders'), and a Cross-Border Protocol to coordinate with parallel Chapter 11 proceedings in the United States.