Coverage of the latest Canadian insolvency filings, court cases, news and more
Kalco Farms Ltd. (“Farms”), a Gibbons, Alberta-based farm which produces and markets cereal grains such as wheat, barley, and rye, along with Kalco Investments Ltd. (“Investments”), were placed in receivership on January 14 on application by BMO, owed approximately $5.0 million from Farms and $11.2 million from Investments. The companies had granted security in favour of BMO, including, among other things, general security agreements securing all of the companies’ real and personal property and mortgages in relation to lands owned by the companies. These agreements allow and provide for the appointment of a receiver or a receiver and manager upon default in respect of obligations owed to BMO. By failing to keep up with their loan obligations, the companies defaulted under these agreements. In addition, various assets of the companies were seized in 2020 on the basis of a security interest and landlord distress. As such, BMO has significant concerns regarding the stability of its security and has lost confidence in the companies to repay their indebtedness. The Bowra Group was appointed receiver. Dentons is counsel to the applicant.
Destiny Organics Inc., a Nisku, Alberta-based organic fertilizer and living soil company, filed for bankruptcy on January 4, listing approximately $647.6 thousand in liabilities and $112.4 thousand in assets. The company is a wholly-owned subsidiary of Destiny Bioscience Global Corp., a cannabis genetics and tissue culture research and development company, which (along with various other subsidiaries) was placed in receivership on May 22 on application by Synergy Projects (Destiny) Ltd. and Synergy Projects Ltd. The company was no longer operating at the time of the receivership. The Bowra Group is the bankruptcy trustee.
EzTix Event Ticketing Inc., a Vancouver, British Columbia-based company that provides ticketing solutions to event organizers around the world, filed an NOI on November 30 and a proposal to its creditors on December 29. The company lists approximately $1.1 million in liabilities. McEown and Associates is the proposal trustee.
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“Study the past if you would define the future.” Confucius’ quote is a favourite of Michael Rotsztain, who has been practising insolvency and restructuring law for over 40 years. Beginning his career at the legendary insolvency firm of Harries Houser, where he had the good fortune of being mentored by a bankruptcy law dream team, Michael spent the major part of his career at a leading Bay Street firm and since 2014 has been the chair of GSNH’s five-lawyer Restructuring and Insolvency Group. Michael recounts how insolvencies and restructurings have evolved over his career and shares what he thinks are the next steps in the evolution.
Chandos Construction Ltd. v. Deloitte Restructuring Inc.: Anti-Deprivation Rule Exists in Bankruptcy Law
Romain Viel, Hilary Gilroy and Colin Boyd of McInnes Cooper discuss the key takeaways from the Supreme Court of Canada’s decision in Chandos Construction Ltd. v. Deloitte Restructuring Inc. and provide guidance on the precise scope of the anti-deprivation rule, including the types of clauses that would not violate the rule.