M. Poliak

Following the successful dismissal of a motion to approve a settlement agreement in CCAA proceedings, the successful lien claimants sought costs against the applicants, Tarion, and the applicants' shareholder.

The court declined to award costs against Tarion because the lien claimants failed to provide adequate prior notice of their intention to seek costs against it.

However, the court awarded costs against the applicants' estate, reasoning that the estate and its creditors benefited from the lien claimants' successful opposition, which preserved security funds.

Costs were fixed at $35,000 total on a partial indemnity basis, payable only to the extent the applicants actually receive the benefit of the security.

In CCAA restructuring proceedings involving a retail apparel company, the monitor sought approval of an asset sale agreement for the debtor’s Costa Blanca business and the debtor sought an extension of the stay of proceedings.

The court considered the criteria under ss. 36(3) and (4) of the Companies’ Creditors Arrangement Act and found the sale process had been conducted fairly and transparently and that the proposed transaction provided the best available consideration to creditors, notwithstanding that the purchaser was related to the debtor.

Approval of the sale was granted subject to a condition requiring the transaction to close by a specified deadline, failing which the debtor and monitor were required to seek further court directions.

The court also granted the debtor’s request to extend the stay of proceedings, approve liquidation of certain store inventory and fixtures, continue a key employee retention plan, and authorize repayment of secured loans.