Peter J. Osborne

Sandvine Corporation and its affiliates sought an initial order under the Companies’ Creditors Arrangement Act (CCAA), including an urgent 10-day stay of proceedings, extension of the stay to non-applicant entities (Procera II LP and other foreign subsidiaries), appointment of KSV Restructuring Inc. as monitor, and approval of interim financing (DIP) charge, administration charge, and directors' charge.

The court found the applicants insolvent, established jurisdiction in Ontario, and determined that the requested relief was necessary for the continued operation and restructuring of the integrated global business.

The Initial Order was granted, and a comeback hearing was scheduled.

The defendants brought a motion for leave to amend their Statement of Defence to add a counterclaim and new parties, alleging breach of contract and copyright infringement related to the transfer of intellectual property.

The plaintiffs opposed the motion, arguing the proposed counterclaim was statute-barred.

The court found that the defendants knew or ought to have known the material facts giving rise to the claim more than two years prior to seeking the amendment.

The court dismissed the motion, concluding the claims were statute-barred under the Limitations Act, 2002, and that allowing the amendment would cause non-compensable prejudice to the plaintiffs given the imminent trial date.

The applicants in a CCAA proceeding sought approval for a revised Wind-Down Plan, a Liquidity Contribution Alternative and Turnover Order, a Stay Extension, and a Key Employee Retention Plan (KERP).

The court approved the relief, finding the revised plan addressed previous concerns by allowing secured creditors (Recourse Lenders) the option to pay their pro rata share of the liquidity requirement to retrieve collateral, or for the applicants to sell inventory to fund the wind-down.

The court also found the KERP appropriate and necessary for an efficient wind-down and extended the stay of proceedings.

The Receiver sought orders to approve a construction management contract and related financing for the Heart Lake Project, and to authorize amendments or disclaimers of pre-sale agreements for the Uptowns Project.

The court granted the relief, finding it was the best path to maximize stakeholder recovery, noting that the proposed amendments to pre-sale agreements offered homebuyers an option to retain value or claim deposits from a surety policy, and that disclaiming agreements was necessary for financing and project completion.

The court also approved sealing certain financial information to protect future marketability.

Morrocanoil, Inc. brought a motion seeking leave to supplement the evidentiary record in its appeal from the disallowance of its proof of claim in the insolvency proceedings of Conforti Holdings Limited (CHL).

The motion concerned the inclusion of "Confidential Documents" (depositions) that were referenced in Morrocanoil's proof of claim but not fully provided to the Proposal Trustee due to a New Jersey confidentiality order.

While Morrocanoil argued the documents were already part of the record, CHL disagreed.

The court found that excerpts had been provided by both parties, but the full extent was unclear.

The motion was adjourned to allow the parties to further review the record, determine if additional excerpts were needed, and ascertain if relief from the New Jersey court was required before providing the confidential documents.

The Receiver of The Lion's Share Group Inc. brought a motion to appoint an interim receiver over the property of the debtor pursuant to section 46 of the Bankruptcy and Insolvency Act.

The Receiver argued that the debtor owed over $23 million under various promissory notes and personal guarantees, and that an interim receiver was necessary to prevent the dissipation of assets.

The debtor opposed the motion, arguing he was not personally liable under the guarantees and that the transactions in question were in the ordinary course of business.

The court granted the motion, finding that the Receiver was likely to succeed on the bankruptcy application and that there was an immediate need to protect the estate given the debtor's recent transactions and the complex web of related entities.

The Body Shop Canada Limited (TBS) brought a motion seeking an extension of the Companies' Creditors Arrangement Act (CCAA) stay, a declaration that the UK Purchaser is a critical supplier, the granting of a critical supplier charge over inventory up to $1.5 million, and approval of charge priorities.

The Court-appointed Monitor supported the relief.

Certain terminated employees did not oppose the relief but requested a shorter stay extension and information for a liquidation analysis to explore WEPPA benefits.

The court granted all relief sought by TBS, finding the UK Purchaser to be a critical supplier essential for TBS's continued operations and the ongoing sale process.

The critical supplier charge was deemed appropriate and non-prejudicial.

The requested stay extension was found reasonable and necessary, and the employees' request for a shorter extension and liquidation analysis was denied as inappropriate at this stage.

Representative Counsel for Non-Union Employees and Retirees sought approval for $200,000 in additional costs, including legal fees and financial advisor costs, to be paid from distributions to employees and retirees in the Metroland Media Group Ltd. proposal.

The request was unopposed by the Proposal Trustee and supported by the affected stakeholders.

The court, exercising its discretion under section 197(1) of the Bankruptcy and Insolvency Act, approved the costs, finding them reasonable based on factors such as the extensive activities undertaken and the fact that the costs were paid by the employees themselves, causing no prejudice to other creditors.

This endorsement addresses two motions within a Companies' Creditors Arrangement Act (CCAA) proceeding concerning 2039882 Ontario Limited, a modular home community developer.

The Monitor sought approval of its reports, fees, and the termination of the CCAA proceedings.

The Receiver sought approval of a sale agreement (a credit bid by KHL Investments USA Inc.), authorization to disclaim certain Homebuyer Contracts due to unresolved water/sewage issues preventing construction, and approval of its reports and fees.

The court granted both motions, finding the sale transaction to be the best available outcome and the disclaimer of contracts necessary, despite the unfortunate impact on prospective purchasers who lost their deposits.

The court also approved sealing certain confidential exhibits.

The parties attended a case conference to settle the form of an order arising from a previous decision by a retired judge.

The respondents sought to include language requiring the return of shares, which the applicant opposed.

The court found that the previous judge made no determination regarding the return of shares, as the issue was not before the court during the prior hearing.

The court declined to include the respondents' proposed language and settled the order in the form submitted by the applicant.

This case conference addressed a dispute over the final form of an order previously issued by a retired judge.

The respondents sought to include language regarding the return of shares, which the applicant contended was never an issue before the court.

The court, interpreting the original order and the scope of the prior hearing, determined that the retired judge had made no finding or determination on the return of shares.

Consequently, the court declined to include the proposed language, settling the order in the form submitted by the applicant.

The Applicants in a CCAA proceeding sought a Funding Contribution and Turn-Over Order to compel various financiers to contribute to a $40 million wind-down cost, an extension of the stay period, and approval of a Key Employee Retention Plan (KERP).

The court declined the Funding Order and KERP, finding that CCAA section 11.01(b) prohibits compelling new money advances from stakeholders, and that securitization parties are differently situated with assets excluded from the debtor's property.

The court did grant a shorter extension of the stay of proceedings.

In the context of CCAA proceedings, the applicants sought a Funding Order to compel Securitization Parties and other secured lenders to fund a $40 million wind-down of the remaining entities.

The court dismissed the motion for the Funding Order, finding that section 11.01(b) of the CCAA expressly prohibits orders requiring the further advance of money or credit.

Consequently, the court also declined to approve a Key Employee Retention Plan, as it was dependent on the unavailable funding.

The court did, however, grant a temporary sealing order for the KERP details and extended the stay of proceedings to November 29, 2024.

This endorsement concerns a motion brought by Pride Group Holdings Inc. and its affiliates (the Applicants) under the Companies' Creditors Arrangement Act (CCAA) for approval of a going concern transaction for Pride Group Logistics (PGL), a distinct business line.

The proposed purchasers included principals of the Applicants, leading the Court-appointed Monitor to undertake negotiations and carriage of the motion.

The Monitor, supported by the Applicants, their directors, employees, and some financiers (Daimler, Mitsubishi, Finloc, National Bank), recommended approval, arguing it offered a higher recovery than liquidation, preserved approximately 500 jobs, and avoided significant wind-down costs for the broader Pride Entities.

The transaction was opposed by certain secured lenders, including The Bank of Nova Scotia, The Lending Syndicate, TD Equipment Finance Canada, and RBC entities, who preferred a wind-down.

The court applied the factors under CCAA s. 36(3) and the Soundair Principles, finding the sale process reasonable, fair, and transparent.

The court concluded that the transaction was the only viable going concern option, superior to a wind-down, and consistent with the CCAA's purpose of avoiding social and economic losses from liquidation.

The PGL Going Concern Transaction was approved.

The People's Trust Company, as assignee of Enlightened Funding Corporation, brought a motion seeking an order to compel Deloitte Restructuring Inc., the court-appointed Receiver of Velocity Asset and Credit Corporation and 926749 Ontario Ltd., to produce documents relevant to the personal bankruptcy application against Hugh Waddell, the principal of the Respondents.

Despite Waddell's non-cooperation and previous adjournments, the court dismissed the motion.

The court found that the Receiver's appointment order, specifically section 4(m) concerning information sharing, was not broad enough to authorize production for purposes outside the receivership's primary objectives.

The court emphasized that the documents were sought to prosecute the bankruptcy application against Waddell, not to advance the receivership of the Respondents.

The court noted that other avenues exist within the Bankruptcy Application to compel such production.

In the context of ongoing CCAA proceedings, the applicants and various equipment financiers reached an impasse regarding the wind-down plan and a proposed going-concern sale of the logistics business.

The applicants sought a monetization order, an increase in the administration charge, and lien regularization, which were unopposed and granted by the court to maintain operations.

Due to significant disputes over the sale and liquidation of assets, the court adjourned the contested motions, including several lift-stay motions brought by creditors, and ordered the parties to attend mandatory mediation before a former Commercial List judge.

The plaintiff in a complex family trust dispute brought motions on the eve of trial for further documentary production, further examinations for discovery, and leave to amend her Statement of Claim.

The motions sought to introduce new allegations that the defendants covered up and settled claims of sexual misconduct against the family patriarch, Frank Stronach.

The court dismissed both motions, finding no evidence that the requested documents existed, that the new allegations were irrelevant to the pleaded claims of corporate mismanagement, and that amending the pleadings three weeks before a scheduled seven-week trial would cause non-compensable prejudice and delay.

The plaintiff, John Kozak, brought an interim preservation of property motion seeking to restrain the defendant, Rebecca Russo, from dissipating shares of SolarBank Corporation and related proceeds, which Kozak claimed were held in trust for him.

Russo, self-represented and studying abroad, did not appear but had requested an adjournment.

The court validated service and denied the adjournment due to a clear risk of asset dissipation.

Applying Rules 45.01 and 45.02, the court found a serious issue to be tried and that the balance of convenience favored granting the order, given the Declaration of Trust, Russo's stated intent to move assets, and her presence in a foreign jurisdiction.

The motion was granted, and costs were awarded to the plaintiff.

In a Companies’ Creditors Arrangement Act (CCAA) proceeding, the DIP Lender, Cortland Credit Lending Corporation, sought a case management order to schedule a threshold motion.

The motion aimed to determine the legal priority of Cortland's claims over those of Final Bell Corp., which had amended its claim to seek a constructive trust that could prime the DIP charge.

The CCAA Applicants supported the motion, arguing it would avoid further delays to the Stalking Horse Purchase Agreement approval.

Final Bell Corp. opposed, viewing it as an unfair mid-trial motion for partial summary judgment.

The court, exercising its broad discretion as the supervising CCAA court, granted the motion, directing that the threshold issue of legal priority be determined first to minimize costs and maximize efficiency, finding no prejudice to Final Bell Corp.

This endorsement addresses three motions within a receivership proceeding.

Mizrahi Inc. (MI) sought extensive production of construction documents and an increased reserve, arguing relevance to its pending payment motion and a set-off claim.

The Receiver sought a Lien Claims Resolution Order to standardize the process for resolving lien claims.

Gamma Windows and Walls International Inc. (Gamma) sought an order for payment of invoices, contract termination, and a reference to quantify its lien.

The court largely dismissed MI's document production request, finding it sought information for a collateral purpose (assessing a personal guarantee) and that sufficient information was already available through the SISP Data Room, with a minor exception for general cost information.

The Lien Claims Resolution Order was granted as unopposed.

Gamma's motion was adjourned to allow for consensual discussions, with the court emphasizing that its claims should be resolved through the newly established Lien Claims Resolution process or heard concurrently with MI's payment motion for judicial economy.