The Priority of Priming Charges Under The CCAA
October 31, 2021 By Brian Babcock A judge supervising an insolvency may, in some situations under the Companies Creditors Arrangements Act (CCAA) order that “priming charges” have the effect of giving priority to freshly advanced credit over debts incurred before the insolvency, including those of secured creditors, and the so-called deemed trust under the Income Tax […]
When the Contract is Silent about the Ending
October 31, 2021 By Brian Babcock When do your obligations under a contract end? Most contracts provide a specific date as a deadline for performance. Others end when the outcome – the service or delivery of goods – is finished. Occasionally, however, we encounter a contract that does not provide clearly for the obligations to […]
The Oppression Remedy and Mutual Falling Outs
October 22, 2021 By Brian Babcock The oppression remedy is NOT the solution to all corporate deadlock involving closely held private corporations. It is only available for conduct which is unfairly prejudicial to or unfairly disregards the interests of the other shareholder. It is not a good option to resolve mutual falling out situations. You […]
The Oppression Remedy and Marriage Breakdown
September 22, 2021 By Brian Babcock For many people, going into business with their spouse is a dream – who better as a business partner than your life partner? But what happens when that dream becomes a nightmare? According to the case of Fuentes v. Camino Construction, the oppression remedy under the Ontario Business Corporations […]
Watch Your Lease Renewal Dates
August 23, 2021 By Brian Babcock The Ontario Court of Appeal has given the duty of good faith in performing contracts a narrow reading, refusing to apply it to grant relief from forfeiture in a situation where a commercial tenant was outside the agreed dates for attempting to renew its lease. The case involved a […]
Personal Liability of Directors
June 29, 2021 By Brian Babcock Directors and officers of corporations have many potential liabilities. About a decade ago, a client asked us to assemble a collection of all the provisions on director’s liability that we could find. It was over an inch thick. If we updated it, no doubt it would be thicker. However, […]
Absolute Discretion and the Duty of Good Faith
May 10, 2021 By Brian Babcock Absolute discretion under a contract is not always absolute. The Supreme Court of Canada continues to develop the law relating to the duty of good faith in the performance of a contract. In Wastech Services Ltd. v. Greater Vancouver Sewerage and Drainage District, the parties had a long term […]
Reasonable Expectations Cannot Be Ignored
April 15, 2021 By Jonathon Clark Minority shareholders in a closely held private corporation may be entitled to have a reasonable expectation of sharing in the management and operation of the business, regardless of their employment status. Family businesses can be wonderful joint adventures, until events occur which shatter those bonds. LDS Capital Corporation v. […]
Bond Trustees Do Have Duty to Inform
April 15, 2021 By Brian Babcock A trustee has a duty to inform beneficiaries of the existence of the trust where failure to do so might result in the beneficiary suffering a loss. Failing to fulfill his duty may result in the trustee being required to make good the beneficiary’s losses. This principle is noteworthy […]
Buyer Beware: Employment After Share Sale
April 6, 2021 By Brian Babcock Employment contracts related to commercial transactions remain employment contracts and employment law applies. You should not ignore this if you are involved in a purchase and sale transaction, or any terminations after the sale. Ontario courts continue to find in favour of employees on termination of employment issues. In […]