With business struggling during the COVID-19 pandemic a large workforce may become a significant liability. Terminating employees may be the only option to allow the business to survive. But the obligations that are owed if many employees are terminated at the same time may be too large for the employer to pay, which creates a situation where the employer cannot afford to keep its employees but also cannot afford to terminate them. A proposal under the Bankruptcy and Insolvency Act may be the solution.
The significant priorities cases in 2020 arose in every imaginable context from the sale of residential properties to construction projects to remediating environmental damage. The overarching theme was that most cases dealt with a dispute between lenders’ registered security interests and unregistered interests that arose as a result of various statutory trusts or priorities in favour of governments.
The decision in Sellathamby (Re), the trustee’s obligation to examine a proof of claim under section 135(1) of the BIA, and the nature of an appeal from a trustee’s disallowance make it clear that a trustee cannot merely disallow a claim because arriving at a decision is difficult or because it is the trustee’s “practice”. The trustee has to properly consider the evidence and prepare a reasoned decision in order for the claims process, including appeals, to function properly.
The safest way for a trustee in bankruptcy to protect title to real estate owned by a bankrupt is to register a bankruptcy caution.
Defaulting on a business loan is a reality for many Canadian businesses, especially during COVID-19. But what happens when you default? And are there any ways to avoid the worst consequences of a default? What to expect when your bank demands payment The first thing the bank will do will be to demand payment andContinue reading “What happens if you default on a business loan?”
We all want customers and we go to great lengths to keep them happy. One of those lengths is letting customers pay for products in 30, 60 or even 90 days. It is important to remember that when you do this you are lending your money to your customer. Here’s how to safely extend creditContinue reading “Credit Application Best Practices to Get You Paid”
The short answer is no; your corporation’s bankruptcy does not affect your personal credit. Your corporation is a separate legal entity. It has its own debts, its own contracts, and its own credit. Your corporation’s bankruptcy does not affect your personal credit and the fact that a corporation that you were a shareholder, director, orContinue reading “Does your corporation’s bankruptcy affect your personal credit?”
One of the tools available to a receiver is the power to affirm or disclaim contracts. Paragraph 3 of the commercial list users committee model receivership order sets out the powers generally given to a receiver appointed pursuant to section 243(1) of the Bankruptcy and Insolvency Act and section 101 of the Courts of JusticeContinue reading “Can a receiver partially disclaim a lease?”
Your client just closed on the purchase of a small but successful business. The vendor owns the property but it’s ok; your client has an option to purchase and in a few years of building the business they can close on the property too. A few years pass and the business grows. The option dateContinue reading “Specific Performance in Real Estate Litigation Made Eas(ier)”