Robert J. Chadwick

The applicant, Sherritt International Corporation, sought final approval of a plan of arrangement under section 192 of the Canada Business Corporations Act to restructure its debt.

The application was opposed by two term lenders, who argued that their term loan was not a 'security' capable of arrangement, that they were unfairly grouped in the same voting class as unsecured noteholders, and that the plan was substantively unfair.

The Superior Court of Justice rejected these arguments, finding that the term loan fell within the statutory definition of a debt obligation, that the voting classification was appropriate given the shared unsecured nature of the claims, and that the plan was fair and reasonable.

The court approved the plan of arrangement, while also providing a detailed critique of the limitations and lack of independence of the fairness opinion submitted by the applicant.

The applicants, RGL Reservoir Management Inc. and 10504360 Canada Inc., sought an interim order under section 192(4) of the Canada Business Corporations Act (CBCA) to approve procedural matters for meetings of secured debtholders and shareholders to vote on a proposed plan of arrangement.

The arrangement aimed to effect a recapitalization transaction, reducing RGL's indebtedness by approximately $333 million and annual cash interest expense by $20 million.

The court granted the motion, finding that the proposed arrangement met the statutory requirements of the CBCA, was put forward in good faith for a valid business purpose, and that it was impracticable to achieve the fundamental change through other CBCA provisions.

The court also approved a limited stay of proceedings to facilitate the transaction.

The applicants brought an ex parte motion for a preliminary interim order under section 192(4) of the Canada Business Corporations Act to facilitate a recapitalization transaction.

The proposed arrangement aimed to reduce the company's debt obligations by more than $2 billion.

The court found that the statutory requirements were met, the arrangement was put forward in good faith, and it was impracticable to effect the fundamental change under any other provision.

The court granted the preliminary interim order, including a broad stay of proceedings, to allow the company to advance the recapitalization transaction.

In CCAA proceedings involving an educational publisher, the secured lender sought full indemnity costs following a successful motion resulting in the replacement of the monitor and related relief.

The court considered a contractual costs provision in the second lien credit agreement permitting recovery of enforcement costs, subject to the court’s supervisory discretion to ensure fairness and reasonableness.

The court confirmed that contractual provisions for full indemnity costs are generally enforceable where reasonable and declined to defer determination of costs.

Canadian counsel fees were found fair and reasonable, while the claim for U.S. counsel fees was reduced due to insufficient justification.

Costs of $194,091.59 were ordered payable to the secured lender.

In a comeback motion under the CCAA, the second lien agent challenged the appointment of the proposed monitor on the basis that its affiliate had acted for the debtor for more than two years, directed the pre-filing SISP, and participated in negotiations concerning the restructuring that would eliminate second lien recoveries.

The court held that a monitor must be independent and be seen to be independent, and found the proposed monitor could not impartially advise the court on the central issue of the reliability of the pre-filing sales process.

The court replaced the proposed monitor with another insolvency firm.

The court also ordered that, pending further order, the debtor could not pay interest or other expenses to the first lien lenders unless the same payments owing to the second lien lenders were made.

In CCAA proceedings, the applicants sought sanction of an amended and restated plan of compromise and arrangement, approval of related releases, and an extension of the stay.

The court held the plan satisfied the established sanction requirements because statutory compliance was met, the voting results were unanimous in all creditor classes, and the plan was fair and reasonable in light of the available alternatives and stakeholder support.

The court also approved third party and director/officer releases as rationally connected to the restructuring and necessary to its successful completion.

The stay was extended and the Monitor's activities and reports were approved.

The applicants sought an initial order under the Companies’ Creditors Arrangement Act to commence restructuring proceedings and implement a proposed recapitalization supported by secured noteholders holding the majority of the applicants’ debt.

The court found the applicants qualified as debtor companies under the CCAA and were insolvent due to defaulted secured notes exceeding $110 million and an inability to meet obligations as they became due.

The court approved the initial order, including a stay of proceedings, administration and directors’ charges, authorization to pay certain pre‑filing obligations, and appointment of a monitor with authority to seek Chapter 15 recognition in the United States.

The court also granted a claims procedure order and a meetings order permitting creditors to vote on a proposed plan of compromise and arrangement, including classification of creditor groups and authorization to proceed with a consolidated plan.

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.

Invesco sought leave to appeal orders sanctioning a Plan of Compromise and Reorganization under the CCAA and approving a settlement that released Ernst & Young LLP from claims arising from its auditing of Sino-Forest Corporation.

The Court of Appeal denied leave, finding that the proposed appeals failed to meet the stringent test for leave in CCAA proceedings.

The appeal of the Sanction Order was moot, and the issues regarding the third-party release in the Settlement Order were governed by the court's prior decision in ATB Financial.

A debtor company sought an initial order under the Companies’ Creditors Arrangement Act to implement a consensual recapitalization transaction supported by major secured creditors.

The motion requested a stay of proceedings, approval of debtor‑in‑possession financing and related charges, authorization for certain pre‑filing payments, and the appointment of a monitor and foreign representative.

The court was satisfied that the company qualified as a debtor company and that the restructuring proposal had substantial creditor support.

The court granted the requested relief, including a sealing order for confidential financial materials and approval of claims procedure and creditors’ meetings orders to facilitate the restructuring plan.

The appellants, auditors and underwriters of Sino-Forest Corporation, appealed an order declaring that their claims for contribution and indemnity against Sino-Forest were 'equity claims' under the Companies' Creditors Arrangement Act (CCAA).

The claims arose from proposed shareholder class actions alleging misrepresentation.

The Court of Appeal dismissed the appeal, holding that the definition of 'equity claim' in s. 2(1) of the CCAA focuses on the nature of the claim rather than the identity of the claimant.

The court found that the appellants' claims for contribution and indemnity were clearly connected to the shareholders' equity claims and thus fell within the expansive statutory definition.

The applicants, comprising the Cinram Group, sought an Initial Order under the CCAA.

The court found that the applicants were debtor companies and insolvent, facing a looming liquidity crisis.

The court granted the Initial Order, which included a stay of proceedings extended to non-applicant subsidiaries, authorization to pay critical pre-filing obligations, and approval of various charges including a $15 million DIP financing charge, a $3.5 million administration charge, a $13 million directors' and officers' charge, and a $3 million KERP charge.

The court also authorized the foreign representative to seek recognition under Chapter 15 of the US Bankruptcy Code.

The applicant corporation sought relief under the Companies’ Creditors Arrangement Act including an initial order, a stay of proceedings, approval of a sale process, and authorization of administration and directors’ charges.

The court considered whether the corporation qualified as a debtor company and whether the requested restructuring steps were appropriate in the circumstances of significant financial distress and ongoing investigations.

The court accepted that the corporation was insolvent and that a restructuring under the CCAA was necessary to preserve enterprise value and explore a potential sale of business operations.

The court approved the requested charges, authorized the sale process, and granted ancillary relief including recognition proceedings in foreign jurisdictions.

The Court of Appeal dismissed the appeal and issued an endorsement on costs.

The respondents were collectively awarded costs of $15,000, inclusive of disbursements and GST, payable by the Confederation of National Trade Unions (CSN) and La Régie Des Rentes Du Québec.

The appellants, Confederation of National Trade Unions and La Régie Des Rentes Du Québec, appealed an order staying the obligation of Slater Steel to file an actuarial report and relieving the company and its directors from any resulting obligations.

The Court of Appeal dismissed the appeal, finding no error in the motion judge's reliance on evidence that further employer contributions were not due until the valuation report was filed.

The Court also noted that other parties had acted in reliance on the stay order.