Roger M. Jaipargas

The moving parties, representing non-union active employees and retirees of a company in separate CCAA proceedings, sought leave to intervene in an appeal after oral arguments had concluded and judgment was reserved.

The appeal involved issues under the Pension Benefits Act and the Personal Property Security Act that could significantly impact the moving parties' interests.

The Court of Appeal granted the motion to intervene, finding the moving parties would provide a useful perspective.

To prevent injustice, the intervention was limited to existing issues and the record, and the moving parties were ordered to pay the responding party's reasonable costs for responding to their factum.

Companies applied for initial protection under the Companies’ Creditors Arrangement Act in respect of insolvency arising from liquidity issues and substantial unsecured investor debt.

Evidence showed significant unpaid promissory notes and bonds, loan losses, and transfers of company funds to a related management entity.

The court applied the insolvency tests drawn from the Bankruptcy and Insolvency Act and concluded the companies were debtor companies under the CCAA.

A stay of proceedings was granted to permit restructuring or realization of the lending portfolio.

The court also approved an administration charge and a directors’ and officers’ charge to support the restructuring process.

In a liquidating CCAA proceeding, the court considered whether a deemed trust under the Pension Benefits Act arose in respect of pension plan wind-up deficiencies, giving priority over secured creditors.

Applying the Supreme Court's decision in Indalex, the court held that no deemed trust arose because the pension plans were not wound up prior to the CCAA Initial Order.

The court granted the second lien lenders' motion to lift the stay of proceedings to allow a bankruptcy petition to proceed, concluding that imposing a provincial deemed trust priority in the middle of an insolvency proceeding would undermine the predictability and flexibility of the CCAA regime.

A motion was brought in a receivership proceeding to lift a stay of proceedings to permit continuation of a construction lien action and allow the lien claimant to set the action down for trial before the statutory expiry of the lien.

The receiver did not oppose lifting the stay but sought conditions, including setting aside a default judgment and noting in default entered against the debtor shortly after the receivership order.

The court held that the default judgment had been obtained contrary to the stay imposed by the appointment order and therefore had no force or effect.

Applying principles governing the lifting of insolvency stays and balancing prejudice to the parties, the court concluded that it was appropriate to lift the stay subject to conditions.

The court ordered that the noting in default and default judgment be set aside and permitted the receiver to defend the lien action.

The applicants, a group of companies owned by Dondeb Inc., sought an Initial Order under the Companies' Creditors Arrangement Act (CCAA) to enable an orderly liquidation of their assets.

The application was opposed by approximately 75% of the secured creditors, who argued for individual receiverships due to a lack of confidence in the applicants' principal and the burden of CCAA administrative costs.

The court dismissed the CCAA application, finding it unlikely that a successful plan could be developed and approved by the creditors.

Instead, the court issued a Global Receivership Order, which was supported by the opposing creditors, to achieve an orderly liquidation at a lower cost.

The appellant appealed an order finding its bid in a receivership sale process to be invalid.

The Court of Appeal dismissed the appeal, agreeing with the motion judge that the agreed process required parties to submit their final and best offer by a specified date and that the bids were to remain confidential.

As such, an auction was not contemplated, and the appellant's bid was properly ruled invalid.

The appellants, a non-profit housing co-operative and a co-operative housing federation, appealed an order approving a receivership sale of the co-operative's assets to a municipality-controlled entity.

The appellants argued that the motion judge failed to properly consider the special nature of co-operative housing and the rights of its members.

The Court of Appeal dismissed the appeal, holding that the standard Soundair principles for approving a receiver's sale apply, and that the motion judge correctly balanced the special factors of social housing against the financial realities and statutory framework.

The applicants sought judicial review of the Region's decision to consent to the sale of a non-profit housing co-operative to the Region's social housing arm.

The Co-op was in receivership due to financial difficulties and need for capital repairs.

The Region consented to the sale without notifying the Co-op's board or members.

The Divisional Court held that the Region's decision was judicially reviewable and that the Region breached its duty of procedural fairness by failing to provide notice and an opportunity to make submissions.

However, given the urgent need for repairs, the court declined to quash the consent and deferred the matter to the Commercial List where the sale motion was pending.

Appeals and cross-appeals arising from the collapses of two airlines operating leased aircraft and leaving substantial unpaid airport and civil air navigation charges.

The Court held that legal titleholders were not personally liable for unpaid navigation charges under s. 55 of the Civil Air Navigation Services Commercialization Act because 'owner' was limited to persons with legal custody, control, or possession in the statutory context.

However, the seizure and detention remedies under s. 56 of that Act and s. 9 of the Airport Transfer (Miscellaneous Matters) Act operated against aircraft owned or operated by the defaulting airlines and could not be defeated by leasing arrangements or by separating attached engines.

The remedies extended to security posted in substitution for the aircraft, subject to the motions judges’ supervisory discretion to craft fair terms.

Interest continued to run until payment, posting of security, or bankruptcy.