Saneea Tanvir

The Toronto-Dominion Bank (TD) brought a motion under Rule 5.05 to sever certain allegations advanced by Tarion Warranty Corporation (Tarion) into two separate actions.

Tarion, along with Carlo and Dino Taurasi, opposed the motion.

TD argued that Tarion's negligence claim (related to a cheque kiting scheme) and its claim to set aside a settlement agreement as a fraudulent conveyance were discrete and temporally separate.

The court dismissed the motion, finding no undue complexity, delay, or prejudice, and that the claims arose from the same series of transactions with significant factual overlap, promoting the convenient administration of justice and avoiding multiplicity of proceedings.

In the context of CCAA proceedings, National Bank of Canada moved to lift the stay of proceedings to appoint a receiver over four real estate properties for which it was the first-ranking mortgage lender.

The applicants and the Monitor opposed the appointment, arguing that the existing sales process under the Real Estate Protocol was functioning well and that appointing a new court officer would add unnecessary costs without significant benefit.

The court dismissed the motion to appoint a receiver, finding it was not just or convenient, but granted a Rent Enforcement Order allowing net rents to be paid to the moving party.

The court also granted a sealing order for the property appraisals to protect the integrity of the ongoing sales process.

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.

The plaintiff sought the continuation of an interim Mareva injunction against multiple defendants, alleging fraud and dissipation of assets.

The court found an overwhelming case of fraud by Stephen Lee Heimbecker and Nestig Inc., and a prima facie case of joint participation, willful blindness, or assistance in the fraud by Joanna Marie Heimbecker and Keystone Capital Inc. The court determined that irreparable harm would occur without the injunction and that the balance of convenience favored the plaintiff.

The court granted the interlocutory Mareva Order, including the release of certain frozen funds to the plaintiff.

The court rejected Joanna Marie Heimbecker's requests to open a new bank account for future employment income and to sell jewellery for legal expenses and tuition, citing a lack of complete and accurate financial disclosure and serious inconsistencies.

The court also declined to reduce the living expense exemption for the Heimbeckers at this stage but left open the possibility if disclosure issues persist.

In the context of a CCAA restructuring, the respondent was previously ordered to specifically perform its obligation to reconvey certain lands to a special purpose entity, which had agreed to sell a portion of those lands to the moving party.

The respondent refused to complete the reconveyance, arguing that the parties had not agreed on the terms of 'shared facilities and/or reciprocal easement agreements' required under the reconveyance agreement.

The moving party brought a motion for the court to interpret the agreement and impose terms.

The court held it had jurisdiction to determine the terms of the reconveyance and found that the respondent's demanded easements (including for undefined future utilities, carbon sequestration, and emissions) were not valid easements at common law and did not meet the contractual requirement of being 'shared' or 'reciprocal'.

The court directed the parties to attempt one final negotiation before it would impose the final terms of the easement agreement.

The DIP Agent sought the appointment of a non-possessory Receiver and approval of a Sale Solicitation Process (SSP) for iSpan Systems LP, which had filed a Notice of Intention to Make a Proposal and subsequently defaulted on its Amended Proposal payments.

The motion also sought to suspend the Claims Adjudication Process and Mediation.

The court found the appointment of a receiver appropriate to maximize value for stakeholders, as bankruptcy would destroy much of the business's value.

The proposed SSP was approved, with the court deferring to the Receiver's recommendations on timeline and deposit amount, despite objections from two unsecured creditors regarding these terms.

The Claims Adjudication Process was also suspended.

The plaintiffs moved for an interlocutory injunction to prevent the defendant from terminating an agreement for the supply of water and wastewater treatment services.

The defendant had threatened to terminate the services on 60 days' notice unless the plaintiffs paid a massive retroactive price increase.

The court found that the injunction was prohibitory, but that the plaintiffs had met the higher standard of a strong prima facie case regardless.

The court held that the defendant's use of the termination clause to extort a unilateral price increase was a strong prima facie breach of the duty of good faith performance.

Finding irreparable harm and a balance of convenience favouring the plaintiffs, the court granted the injunction for nine months to allow the plaintiffs to build their own water recycling facilities.

Yellow Corporation, as Foreign Representative for itself and its Canadian affiliates (the Canadian Debtors), brought a motion under section 49 of the Companies’ Creditors Arrangement Act (CCAA) to recognize and enforce various orders (U.S. Orders) issued by the United States Bankruptcy Court for the District of Delaware in their Chapter 11 proceedings.

The motion, which was unopposed, sought to preserve the value of the Canadian Debtors and business during the wind-down and sale efforts.

The court granted the motion, finding it necessary for the protection of the debtors' property and creditors' interests, and consistent with principles of comity and public policy.

DGAP Investments Ltd. sought a stay pending leave to appeal an order from the supervising judge in a CCAA proceeding.

The order authorized Stelco Inc. to acquire partnership units in a Land Vehicle, which DGAP argued would obstruct its prior agreement to purchase land from the Land Vehicle.

The Court of Appeal applied the RJR-MacDonald test for a stay, finding that DGAP's case for leave to appeal was weak on the merits, there was no irreparable harm given the supervising judge's measures to protect DGAP's interests, and the balance of convenience favoured dismissing the stay to allow the CCAA proceeding to conclude and benefit aging stakeholders.

The motion for a stay was dismissed, and the leave to appeal motion was expedited.

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.

DGAP Investments Limited brought a motion seeking a declaration that provisions governing shared facilities and reciprocal easement agreements in a reconveyance agreement with Stelco Inc. had been complied with or were unnecessary, or alternatively, for court approval of its proposed easement agreement.

This dispute arose within the ongoing Companies’ Creditors Arrangement Act (CCAA) proceedings involving U.S. Steel Canada Inc. The court dismissed DGAP's motion, rejecting its interpretation that the Reconveyance Date had passed and that easement obligations no longer existed.

The court affirmed its jurisdiction under section 11 of the CCAA to resolve such impasses to ensure the timely completion of the reconveyance.

While acknowledging an impasse, the court declined to impose DGAP's specific easement agreement due to an insufficiently developed record, instead ordering continued negotiations and a future case conference to schedule a motion for a judicial determination of the easement dispute.

The Ontario Superior Court of Justice (Commercial List) heard two motions within a long-standing Companies’ Creditors Arrangement Act (CCAA) proceeding concerning U.S. Steel Canada Inc. (now Stelco Inc.).

Stelco Inc. sought approval for a Securities Purchase Agreement (SPA) to acquire the remaining ownership interest in a Land Vehicle from various Stakeholders (employees, retirees, pensioners).

DGAP Investments Ltd., a defendant, brought a cross-motion seeking a strict timetable for the completion of a separate land sale agreement (DGAP Sale Agreement) before the SPA could close, alleging bad faith by Stelco.

The court granted Stelco's motion, finding the SPA beneficial to the Stakeholders by providing immediate monetization and extricating them from ongoing litigation.

DGAP's motion was dismissed, as the court found no evidence of bad faith by Stelco sufficient to delay the SPA, and determined that the SPA and DGAP Sale Agreement were not mutually exclusive.

The court emphasized continued judicial supervision and the Monitor's role in future transactions.

The moving party, an insolvent cannabis producer, brought an unopposed motion for approval of a Proposal under the Bankruptcy and Insolvency Act, approval of Articles of Reorganization, and an order relieving it from the requirement to hold an annual general meeting before dissolving.

The Proposal contemplated paying remaining unsecured creditors, distributing its 10% equity interest in a successor entity to eligible shareholders, and transferring residual assets to satisfy remaining liabilities.

The court found the Proposal reasonable, calculated to benefit the general body of creditors, and made in good faith.

The court also granted relief from holding an annual general meeting, noting the company's lack of funds and the absence of prejudice to shareholders.

The applicant tenant sought a declaration that the respondent landlord acted in bad faith by unreasonably withholding consent to an indirect change of control under a commercial lease.

The landlord demanded a payment of over $5.8 million to grant consent, relying on lease provisions regarding transfers.

The court found that the landlord had already received compensation for the transfer in a previous proceeding and that demanding an exorbitant fee for a change of control that caused no operational prejudice was not in good faith.

The application was granted, and the landlord was ordered to provide consent, limited to the $75,000 processing fee already paid.

The MGMIC Receiver sought a declaration that a second mortgage on Dovercourt Road was valid and enforceable, allowing distribution of sale proceeds to MGMIC investors.

The non-party A13MG argued the mortgage was invalid due to lack of shareholder consent and alleged fraud by MGMIC's directors.

The court found the mortgage valid, citing evidence of consent through email exchanges and the "Indoor Management Rule" under the OBCA.

The court also held that even if invalid, an equitable mortgage would exist to prevent injustice to innocent investors.

A13MG's fraud action was deemed a nullity due to failure to obtain leave.