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Motion to decline jurisdiction dismissed; CCAA court has jurisdiction over cross-border supply contract dispute.
In a CCAA restructuring proceeding, the moving parties (Cliffs) brought a motion objecting to the jurisdiction of the Ontario Superior Court to hear a dispute over a terminated iron ore supply contract.
Cliffs argued that the contract was governed by Ohio law and that Ohio was the convenient forum.
The court dismissed the motion, finding that it had jurisdiction simpliciter because the contract was made in Ontario and Cliffs carried on business in Ontario.
Applying the single control model for insolvencies, the court held that the dispute should be resolved within the CCAA proceedings.
The court also found that Cliffs failed to establish that Ohio was clearly a more appropriate forum.
Receiver appointed where secured creditor demonstrated default and risk to asset value.
A secured creditor applied for the appointment of a receiver over the assets of an insolvent mining company following defaults under a secured credit facility.
The debtor had failed to make scheduled interest payments, was unable to obtain further financing, and its financial position had deteriorated significantly.
The lender had security over all assets and shares of a Colombian subsidiary holding the company’s principal mining properties, but governance disputes and creditor protection proceedings in Colombia created uncertainty and risk to asset value.
The court considered the statutory authority under s. 243 of the Bankruptcy and Insolvency Act and s. 101 of the Courts of Justice Act, along with established principles governing when it is “just or convenient” to appoint a receiver.
Finding that the debtor was in default and that a receivership was necessary to stabilize governance and preserve enterprise value, the court appointed KPMG as receiver.
