Canadian Mental Health Association, Vancouver-Fraser Branch, Bankruptcy

Canadian Mental Health Association, Vancouver-Fraser Branch (the “Branch”), a branch of the Canadian Mental Health Association (“CMHA”), was deemed bankrupt on August 2.

CMHA is a federated charity championing mental health. The Branch is one of more than 65 CMHA branches across the country. The Branch employed approximately 116 people through which it provided community-based mental health services, support and education, in addition to housing, job placements, rehabilitation services and daily living assistance for individuals living with mental illness or addiction in the Vancouver-Fraser area.

The Branch primarily operates through the receipt of grants provided primarily by Vancouver Coastal Health, Fraser Health, BC Housing, and the Canadian Mental Health Association British Columbia. However, the Branch does not receive sufficient unrestricted donations or funding to cover its operational costs that are not part of a particular programs or services.

Rising costs and a reduction in unrestricted donations led to the Branch facing an imminent liquidity crisis and being unable to fund its operation costs, including certain lease payments due on April 1. The Branch filed an NOI on April 9 to enable the orderly transition of the key programs and services. A sale transaction with the Canadian Mental Health Association, Lower Mainland Branch was approved in the NOI proceedings, through which the Canadian Mental Health Association British Columbia will ensure the former operations of the Branch are a going-concern allowing continuity of services and continued employment for retained employees. Following the sale, the Branch was deemed bankrupt on August 2.

MNP is the bankruptcy trustee.

Counsel is Lawson Lundell for the Branch, Norton Rose Fulbright for the trustee, Miller Thomson for the Canadian Mental Health Association of British Columbia, Waterstone Law for the Vancouver City Savings Credit Union, Moore Edgar Lyster for the BC General Employees’ Union, Boughton Law for BC Housing, DLA Piper for Vancouver Coastal Health and Fraser Health, Richards Buell Sutton for Century Group Lands Corporation, and Camelino Galessiere for Royal City Shopping Centre.