Court File and Parties

Court of Appeal for Ontario Date: 20210616 Docket: M52338 (C68764)

Rouleau, Hoy and van Rensburg JJ.A.

In the Matter of the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended

And in the matter of a proceeding in the Hong Kong Special Administrative Region Re: James Henry Ting (in bankruptcy)

Application of Cosimo Borrelli and Jacqueline Walsh of Borrelli Walsh Limited under section 269 of the Bankruptcy and Insolvency Act, R.S.C., 1985, c. B-3, as amended

Counsel: Ilan Ishai, for the moving parties, Cosimo Borrelli and Jacqueline Walsh of Borrelli Walsh Limited Andrew Rogerson and Arash Jazayeri, for the responding party, Andrew Henry Ting

Heard: June 2, 2021 by video conference

Reasons for Decision

[1] This is a motion to quash an appeal.

[2] The appellant, and responding party in this motion, Andrew Henry Ting, seeks to appeal two orders made against him in the context of bankruptcy proceedings in Ontario involving his father, James Henry Ting. Mr. Ting, Sr. was adjudged bankrupt by a Hong Kong court in 2016. The following year the bankruptcy order was recognized by the Superior Court under s. 270 of the Bankruptcy and Insolvency Act (the “BIA”), and the moving parties, who are the trustees in bankruptcy of the bankrupt, were appointed as “foreign representatives” of the bankrupt as defined in s. 268.

[3] On January 15, 2019, Penny J. granted an order in the bankruptcy proceedings enforcing a letter of request from the Hong Kong court, requiring the appellant to make certain productions and to attend an examination. After an unsuccessful attempt to appeal that order (the appeal was quashed and the appellant was denied leave to appeal by the Supreme Court of Canada), the appellant failed to attend for examination. The trustees brought a motion for contempt. By order dated October 5, 2020, Dietrich J. found the appellant in contempt and allowed him to purge his contempt within ten days. The appellant delivered a notice of appeal of that order. On February 8, 2021, the appellant was sentenced to seven days’ incarceration for contempt, to come into effect seven days after the final adjudication of the appellant’s appeal. The appellant served an additional notice of appeal in respect of the penalty order.

[4] The appellant’s notices of appeal assert that he has a right of appeal under s. 193(a) of the BIA. He has also served the trustees with a motion for leave to appeal both orders under s. 193(e). That motion, which is to be heard by a single judge of this court, is scheduled for September.

[5] This court has repeatedly held that an appeal from an order made in bankruptcy proceedings is governed by s. 193 of the BIA: Canada (Superintendent of Bankruptcy) v. 407 ETR Concession Company Limited, 2012 ONCA 569, 95 C.B.R. (5th) 157, at para. 19; Wallace (Re), 2016 ONCA 958, 43 (C.B.R.) (6th) 2010, at para. 7; Business Development Bank of Canada v. Astoria Organic Matters Ltd. and Astoria Organic Matters Canada LP (7 January 2019), Ontario, M49872 (C65512) (C.A.) (In Chambers), at para. 20; Shaver-Kudell Manufacturing Inc. v. Knight Manufacturing Inc., 2021 ONCA 202 (In Chambers), at para. 18. See also 2003945 Alberta Ltd. v. 1951484 Ontario Inc., 2018 ABCA 48, 57 C.B.R. (6th) 272, at para. 11. An order will also be subject to the appeal routes under s. 193 (rather than under s. 6 of the Courts of Justice Act (the “CJA”)) where the order is made by a judge exercising powers conferred by the BIA: Business Development Bank of Canada v. Astoria Organic Matters Ltd., 2019 ONCA 269, 69 C.B.R. (6th) 13, at paras. 29-31.

[6] While an order may involve a bankrupt, or be made during the currency of bankruptcy proceedings, this is not determinative of whether an appeal from that order is governed by the BIA or CJA: Rusinek & Associates Inc. v. Arachchilage, 2021 ONCA 112, 87 C.B.R. (6th) 1; RREF II BHB IV Portofino, LLC v. Portofino Corporation, 2015 ONCA 906, 33 C.B.R. (6th) 9. For example, in Rusinek, an order made on an application pursuant to r. 14.05(3)(d) of the Rules of Civil Procedure, determining that a bankrupt’s trustee did not have the right to commence an equalization claim against the bankrupt’s former spouse, was appealable under s. 6(1) of the CJA. It was not an order made in bankruptcy proceedings, nor was the application judge exercising a power conferred on her by the BIA: at para. 15.

[7] In our view, in the present case, the orders are subject to the appeal routes under s. 193 of the BIA. The appellant commenced his appeal relying on the provisions of the BIA. The orders under appeal were made in the bankruptcy proceedings of Mr. Ting, Sr. The appellant was brought into his father’s bankruptcy proceedings through the order of Penny J., with which he failed to comply, leading to the contempt order and penalty order. Penny J. expressly exercised a power under s. 272(1)(b) of the BIA, that provides, on application by a foreign representative, for an order respecting the examination of witnesses “concerning the debtor’s property, affairs, debts, liabilities and obligations”. Penny J. stated that he was satisfied that the orders enforcing the Hong Kong court’s letter of request and requiring the appellant’s examination, “fall squarely within s. 272(b) of the BIA”. The orders under appeal were made in the context of the enforcement of the Penny J. order.

[8] The appellant contends that he has a right to appeal the motion judge’s contempt order and the penalty order under s. 193(a) of the BIA, which provides for an appeal to this court “if the point at issue involves future rights”.

[9] The appellant asserts that the appeal involves future rights because his appeal raises matters of procedural fairness – as one of his grounds of appeal, the appellant contends that the motion judge improperly refused to recuse herself after the moving parties’ counsel made allegations of criminal misconduct against him that were not supported by the evidence.

[10] Future rights have been described as “rights which could not at the present time be asserted but which will come into existence at a future time”: Elias v. Hutchison, 1981 ABCA 31, 37 C.B.R. (N.S.) 149, at para. 28, cited with approval in Re Ravelston Corp. (2005), 24 C.B.R. (5th) 256 (Ont. C.A.), at para. 19. The question is whether the rights engaged in an appeal are future rights or presently existing rights that are exercisable in the future: Business Development Bank of Canada v. Pine Tree Resorts Inc., 2013 ONCA 282, 115 O.R. (3d) 617 (In Chambers), at para. 16.

[11] In support of the argument that his appeal engages future rights, the appellant relies on Canada Deposit Insurance Corp. v. Commonwealth Trust Co. (1993), 35 C.B.R. (3d) 208 (B.C.C.A.) (In Chambers). In that case, the B.C. Court of Appeal held that the appeal of an order of a judge made under the Winding-up Act for refusing to recuse himself on the grounds of reasonable apprehension of bias, involved future rights. The statutory scheme however was different (s. 103 of the Act provided for appeal with leave from specific orders, including orders “involving future rights”), and the court did not analyze the issue, but accepted the concession of the respondent that the appeal as framed involved future rights, and that it was therefore open to the appellant to seek leave to appeal under the Act: at para. 3.

[12] In Re Ravelston, Doherty J.A. noted that “[e]arlier cases…that would give the phrase ‘future rights’ a ‘wide and liberal interpretation’ are inconsistent with the contemporary approach to statutory interpretation”: at para. 17. Indeed, more recent case law applying s. 193 of the BIA confirms that issues of procedural fairness typically engage a party’s present, and not future rights. In 2003945 Alberta Ltd., a case involving the appeal of an order in receivership proceedings, directing the summary trial of an issue, the court rejected the argument that future rights were engaged because the order restricted the appellant’s rights in a future trial to call necessary witnesses. The court concluded that an appeal of an order on the grounds of procedural fairness implicates a party’s present, not future, rights: at para. 19. See also Simonelli v. Mackin, 2003 ABCA 47, 39 C.B.R. (4th) 297 (In Chambers), at para. 11.

[13] Similarly, in the present case, the appellant’s right to procedural fairness was a present right that existed at the time of the hearing before the motion judge. His appeal of the contempt order and the penalty order do not engage future rights within the scope of s. 193(a) of the BIA.

[14] For these reasons the appeal is quashed. Costs to the moving parties in the agreed amount of $5,000, inclusive of HST and disbursements.

“Paul Rouleau J.A.”

“Alexandra Hoy J.A.”

“K. van Rensburg J.A.”

cited_cases: legislation: - title: "Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3" url: "https://laws-lois.justice.gc.ca/eng/acts/b-3/" - title: "Courts of Justice Act, R.S.O. 1990, c. C.43" url: "https://www.ontario.ca/laws/statute/90c43" - title: "Rules of Civil Procedure, R.R.O. 1990, Reg. 194" url: "https://www.ontario.ca/laws/regulation/900194" - title: "Winding-up Act, R.S.C. 1985, c. W-11" url: "https://laws-lois.justice.gc.ca/eng/acts/w-11/" case_law: - title: "Canada (Superintendent of Bankruptcy) v. 407 ETR Concession Company Limited, 2012 ONCA 569" url: "https://www.canlii.org/en/on/onca/doc/2012/2012onca569/2012onca569.html" - title: "Wallace (Re), 2016 ONCA 958" url: "https://www.canlii.org/en/on/onca/doc/2016/2016onca958/2016onca958.html" - title: "Business Development Bank of Canada v. Astoria Organic Matters Ltd., 2019 ONCA 269" url: "https://www.canlii.org/en/on/onca/doc/2019/2019onca269/2019onca269.html" - title: "Shaver-Kudell Manufacturing Inc. v. Knight Manufacturing Inc., 2021 ONCA 202" url: "https://www.canlii.org/en/on/onca/doc/2021/2021onca202/2021onca202.html" - title: "2003945 Alberta Ltd. v. 1951484 Ontario Inc., 2018 ABCA 48" url: "https://www.canlii.org/en/ab/abca/doc/2018/2018abca48/2018abca48.html" - title: "Rusinek & Associates Inc. v. Arachchilage, 2021 ONCA 112" url: "https://www.canlii.org/en/on/onca/doc/2021/2021onca112/2021onca112.html" - title: "RREF II BHB IV Portofino, LLC v. Portofino Corporation, 2015 ONCA 906" url: "https://www.canlii.org/en/on/onca/doc/2015/2015onca906/2015onca906.html" - title: "Elias v. Hutchison, 1981 ABCA 31" url: "https://www.canlii.org/en/ab/abca/doc/1981/1981abca31/1981abca31.html" - title: "Re Ravelston Corp. (2005)" url: "https://www.canlii.org/en/on/onca/doc/2005/2005canlii63802/2005canlii63802.html" - title: "Business Development Bank of Canada v. Pine Tree Resorts Inc., 2013 ONCA 282" url: "https://www.canlii.org/en/on/onca/doc/2013/2013onca282/2013onca282.html" - title: "Canada Deposit Insurance Corp. v. Commonwealth Trust Co. (1993)" url: "https://www.canlii.org/en/bc/bcca/doc/1993/1993canlii219/1993canlii219.html" - title: "Simonelli v. Mackin, 2003 ABCA 47" url: "https://www.canlii.org/en/ab/abca/doc/2003/2003abca47/2003abca47.html"