Peter J. Osborne

The Trustee in Bankruptcy of Aiden Pleterski and AP Private Equity Limited moved for relief from forfeiture of a $500,000 deposit paid by the bankrupt for a property purchase.

The deposit originated from funds misappropriated from investors.

The vendor, 2649360 Ontario Inc., sought to retain the deposit and a $300,000 surplus from the property's resale.

The court applied the two-part test for relief from forfeiture under section 98 of the Courts of Justice Act, considering whether the forfeited amount was disproportionate to damages and if retention would be unconscionable.

The court found that the vendor had suffered minimal proven damages ($138,500) and that retaining the deposit in addition to the resale surplus would result in an unconscionable windfall, especially given the massive losses suffered by the innocent investors.

The motion was granted, ordering the deposit to be paid over to the Trustee.

Rogers Communications Canada Inc. sought an interlocutory injunction and a sealing order against TELUS Communications Inc. The core dispute revolved around whether Rogers' customers, when roaming on the TELUS network, should display "Rogers-EXT" or "TELUS" as the network identifier (NID).

Rogers argued for maintaining the "Rogers-EXT" status quo pending arbitration, while TELUS contended that an expired agreement required "TELUS" display.

The court characterized the injunction sought as mandatory, requiring Rogers to demonstrate a strong prima facie case.

The court found that the NID issue was subject to issue estoppel due to a prior arbitration decision and that Rogers failed to establish a strong prima facie case or irreparable harm.

Consequently, the motion for injunctive relief was dismissed.

The motion for a sealing order for confidential materials, which was unopposed, was granted.

The applicant brought an oppression application seeking an order that the respondent corporation pay $999,007.50 to redeem her preference shares.

The respondents argued the payment would render the corporation insolvent under s. 32(2) of the Business Corporations Act and sought a stay pending a related appeal.

The court found the appeal had already been dismissed and did not affect the preference shares.

The court also rejected the insolvency argument, finding the corporation had sufficient assets and equity.

The court ordered the corporation to pay the redemption amount, finding it unnecessary to determine if the failure to pay constituted oppression.

LTL Management LLC, acting as Foreign Representative, brought a motion seeking recognition of a U.S. Bankruptcy Court's dismissal order of its Chapter 11 proceeding, termination of the Canadian CCAA proceeding, discharge of the Information Officer (Ernst & Young) with a release, and approval of the Information Officer's activities and fees.

The motion was unopposed.

The court granted the requested relief, finding that with the foreign main proceeding dismissed and no stay of the appeal, there was no longer a basis for the Canadian recognition proceeding to continue.

The Information Officer's reports, activities, and fees were reviewed and approved, and the CCAA proceeding was terminated.

The Trustee in Bankruptcy sought declarations that a property sale by the bankrupt, Ian Ross McSevney, to a corporation controlled by his sister, Elaine McSevney, was a transfer at undervalue under section 96 of the Bankruptcy and Insolvency Act, and that Elaine McSevney was privy to the transfer.

The court found that the relationship between the siblings was not arm's length, that the bankrupt was insolvent or rendered insolvent by the transfer, and that he intended to defraud, defeat, or delay creditors.

The court determined the fair market value of the property and the actual consideration paid, concluding that the transfer was conspicuously less than fair market value.

The motion was granted, and Elaine McSevney and her corporation were ordered to pay the difference to the Trustee.

The Ontario Superior Court of Justice, Commercial List, addressed two issues in a case conference: a proposed motion by the defendants to amend their Amended Statement of Defence and Counterclaim, and a proposed anti-SLAPP motion.

The court granted leave to amend the pleading by consent.

However, the court declined to schedule the anti-SLAPP motion, finding it untimely given the action was nearly three years old and significant litigation steps had already occurred.

The court emphasized that anti-SLAPP motions are screening devices meant for early stages, not surrogates for summary judgment or trial, and that the evidence relied upon for timeliness was available much earlier.

The parties were directed to agree on a case management timetable to prepare for trial.

East West Investment Management Corporation sought an order to pay funds into court or a declaration that its continued management of funds for Thomas Higgins and the TRH Foundation did not contravene the Criminal Code, due to a risk that the funds might constitute proceeds of crime from a German tax fraud scheme involving Maple Bank.

The court, exercising its inherent and supervisory jurisdiction over trusts, granted the order allowing East West to pay CDN$4,398,168 into court, with the consent of the respondents, to mitigate East West's risk of liability under money laundering laws.

The Applicants in a CCAA proceeding moved for approval of a subscription agreement and a reverse vesting transaction, along with a back-up agreement, releases, a claims process, a stay extension, and a sealing order.

The court found the reverse vesting structure necessary to preserve the value of the business as a going concern, particularly to maintain highly regulated cannabis licences and permits.

The transaction would satisfy all secured liabilities and leave a surplus for unsecured creditors.

The court approved the requested relief, noting it was unopposed and supported by the Monitor.

The applicant, 1843208 Ontario Inc., sought to fix the fair value of shares of dissenting shareholders of Baffinland Iron Mines Corporation at $1.50 per share following a plan of arrangement.

The Dissent Group argued for a fair value of $8.91 per share.

The court found that the market price of $1.50, established through a contested takeover bid process, was the best objective evidence of fair value, rejecting the Dissent Group's higher valuation which relied on a discounted cash flow analysis based on unproven mineral resources and overly optimistic projections.

The court also awarded interest to the Dissent Group for the entire period, including a significant delay caused by a stay of proceedings related to a class action.

The Licensed Insolvency Trustee of the Estate of the late Robert Simpson, a convicted child sexual abuser, moved for a court order to impose a claims bar date for the filing of Proofs of Claim.

The Trustee sought this to bring certainty to the Estate's liabilities and facilitate distributions to existing creditors, primarily the victims.

The court, while acknowledging the Trustee's efforts and the deserving nature of the claimants, declined to grant the order based on its inherent jurisdiction.

The court found that the Bankruptcy and Insolvency Act (BIA) provides a comprehensive statutory framework (sections 148-154) for managing dividends and claims, which substantially achieves the Trustee's objectives.

The court directed the Trustee to proceed under these BIA provisions, ensuring notice to potential claimants and allowing for timely distribution to known creditors, while clarifying that late claims would not be extinguished but would be limited to any remaining funds without disturbing prior distributions.

The applicant sought the appointment of a full receiver over the properties and assets of the respondent power generation companies following significant monetary and operational defaults under loan agreements.

The respondents opposed a full receivership, arguing they had secured alternative financing, but consented to continuing an interim receivership.

The court found the proposed financing commitment highly conditional and uncertain, and noted the respondents' lack of interim funding, disarray in management, and risk to employees and operations.

Concluding it was just and convenient to protect the applicant's security, the court granted the application and appointed a full receiver.

The applicant, in its capacity as Foreign Representative, sought an order recognizing the Third DIP Amendment Order granted by the United States Bankruptcy Court.

The order amended the Term Loan DIP Credit Agreement to add a new super senior, first-out $30 million tranche to the DIP facility.

The court found that the Chapter 11 Debtors needed additional financing and that recognition was supported by the principle of comity.

The unopposed motion was granted pursuant to section 49 of the CCAA.

The Bank of Montreal (Applicant) sought approval of the Receiver's (KSV) conduct, fees, and discharge, along with an order for costs against the Respondents (Can United Consulting Corporation, Facilitate Settlement, and other related debtor corporations) and personally against Mr. Kai Wu, the directing mind of the debtor corporations.

The Debtors had borrowed $2.1 million under a federal pandemic assistance program (HASCAP) and failed to repay.

The Business Development Bank of Canada (BDC) repaid the principal to BMO and stepped into BMO's shoes for enforcement.

The Debtors and Mr. Wu showed limited cooperation with the Receiver, failed to provide financial records, and transferred significant funds for personal use.

The court approved the Receiver's conduct, fees, and discharge.

Crucially, the court found Mr. Wu's conduct amounted to an abuse of process due to his persistent failure to comply with court orders and cooperate with the Receiver, despite repeated adjournments and undertakings.

Consequently, the court awarded $50,000 in costs against the Respondents and personally against Mr. Wu.

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.

The Liquidator of Silicon Valley Bank Canada sought court approval of an asset purchase agreement with National Bank of Canada, as well as a sealing order over the unredacted agreement and a confidential comparative analysis.

The court applied the Soundair principles and found that the Liquidator made substantial efforts to canvass the market, the transaction was in the best interests of stakeholders, and the process was fair and efficacious.

The court also granted the sealing order, applying the Sherman Estate test, to protect the maximization of recovery in the event the transaction did not close.

Consolidated Uranium Inc. (CUR) applied under section 182 of the Business Corporations Act for final court approval of a plan of arrangement to spin out Premier American Uranium Inc. (PUR).

The court had previously granted an interim order for a shareholder meeting, where the arrangement was overwhelmingly approved (99.96% of votes cast).

No shareholders exercised dissent rights.

The court applied the three-part test for arrangement approval, confirming that statutory procedures were met, the application was in good faith, and the arrangement was fair and reasonable, noting the strong shareholder approval and the fact that the arrangement did not impact proportionate ownership, thus not requiring a fairness opinion.

The final approval order was granted.

The plaintiffs (over 200 individuals) alleged fraud and misappropriation of $47 million by the defendants (Moninder Khudal, his wife Ramampreet Joshi, and sons Sharanbir and Yashbir Khudal).

A Mareva injunction was granted and subsequently amended.

The defendants moved to vary the injunction to release additional funds for legal/accounting fees, vacate the injunction against the sons, and release post-injunction earnings.

The plaintiffs cross-moved to reduce living expenses to zero and amend their Statement of Claim.

The court applied the four-part Credit Valley test for varying a Mareva injunction.

The court denied the defendants' requests for additional funds for legal/accounting expenses, finding they failed to show no other assets were available and did not make full disclosure.

The court also denied vacating the injunction against the sons, noting their lack of candor regarding financial support from family.

The court reduced the defendants' monthly living expenses from $8,000 to $3,000, acknowledging the undisclosed financial support from family.

The plaintiffs' request to amend the Statement of Claim and for substituted service was granted.

Costs were awarded to the plaintiffs.

The Ontario Securities Commission (OSC) brought a motion seeking an order for the issuance of Letters of Request in Commissions under section 152 of the Securities Act.

The OSC required evidence from two individuals, one residing in British Columbia and one in Massachusetts, USA, for a proceeding before the Capital Markets Tribunal concerning Bridging Finance Inc. and its respondents.

The respondents did not oppose the motion.

The court granted the order, finding that the proposed witnesses had relevant evidence and that the Letters of Request and Commissions accorded with Rule 34.07(2) of the Rules of Civil Procedure.

The Applicant, Instant Brands Inc., as Foreign Representative of the Chapter 11 Debtors, sought recognition of several US Chapter 11 orders, including the Supplemental Interim DIP Order, Final DIP Order, Final Cash Management Order, and Bidding Procedures Order.

The relief was unopposed and supported by the Information Officer.

The court granted the recognition orders, finding them necessary and appropriate to fund operations, maintain an integrated cash management system, and facilitate a competitive sale process, thereby furthering comity and ensuring fair treatment of stakeholders in the cross-border insolvency proceedings.

PricewaterhouseCoopers Inc. (PwC), as the court-appointed Liquidator of Silicon Valley Bank (SVB) Canada, sought court approval for the sale of the Clearco Credit Facilities, a sealing order for confidential transaction documents, and approval of its activities, fees, and disbursements.

The court applied the Soundair Principles to evaluate the sale, finding that the Liquidator made sufficient efforts to obtain the best price and that the process was fair and efficacious.

The Clearco Transaction, which provided the highest value for the assets, was approved.

A sealing order was granted for the confidential appendices due to their commercial sensitivity and potential negative impact on the ongoing sales process and future recoveries, with an unusual extended duration.

The Liquidator's activities, fees, and disbursements were also approved as appropriate given the complexity of the matter.