Tron Construction

In the recent decision of Tron Construction (Re) (2022 SKKB 203), the Saskatchewan Court of King’s Bench determined that a claims process for builders’ lien claims can be established through a single-proceeding model under the Bankruptcy and Insolvency Act[1] rather than through provincial builders’ liens legislation (in this case, Ontario’s Construction Act[2]).

Contract Law

Aubin v Quantiam Technologies Inc.

In the recent case of Aubin v Quantiam Technologies Inc(2022 ABCA 288), the Alberta Court of Appeal upheld the case management judge’s decision to enforce a minority shareholder’s security interest in a corporate owner’s shares in a corporation. The Court determined that doing so is not an unfair preference of one common shareholder over the others, and does not constitute oppression.

Two brothers fighting

Certainty and Partnership Arrangements – Key Components to Consider

When embarking on a business venture, it is crucial to set out clear definitions of roles and relationships of all interested parties involved. This can be especially important when seeking to create a formal business partnership, since such an arrangement gives rise to special legal obligations between the partners (as well as legal implications in the partners’ dealings with others). As illustrated by the cases discussed in this blog, sometimes this can be a challenge. Perhaps individuals will be so busy in the whirlwind of starting up a business that they neglect to provide sufficiently certain terms in their agreements, or maybe the alleged partners were never of one mind to even become partners to begin with. Since such errors can have legal consequences; persons should ensure that, if they actually intend to operate as a partnership, they draft an agreement that unequivocally shows that this is how they want their business to be defined.

A motorcycle in the desert.

Secured creditors’ rights will not be extinguished by recharacterizing collateral after default

As is well-known in the realm of Canada’s secured transaction law, both the secured party and the debtor are entitled to a number of rights and also owe certain obligations to the other party, pursuant to contract and statute. Such rights and obligations are in place for the objectives of fairness, transparency and commercial certainty, among others. The recent decision of Merchant Growth Asset Financing Ltd. v. Pyke,[1] , shows that sometimes one party (in this case, the defaulting debtor) may attempt to diminish the rights and remedies available to the other party by erroneously asserting their own rights under the statute. Horsman J. of the Supreme Court of British Columbia was quick to shut down such an assertion in her summary judgment in favour of the plaintiff and, in doing so, created a precedent for a case that addresses the operation of creditors’ rights when the debtor attempts to recharacterize the nature of collateral after default.

wine bottles at sunset

UPM Raflatac, Inc. v. Okanagan Label & Print Ltd., 2022 BCSC 1154

Can a general sales condition form part of a separate sales contract and thereby limit the liability of the seller? Yes, says the Supreme Court of British Columbia in the recent decision of UPM Raflatac, Inc. v. Okanagan Label & Print Ltd, 2022 BCSC 1154; particularly when the parties have done business together over a long period of time, and the buyer has routinely assented to the terms of the general sales conditions associated with each sales contract.

Two brothers fighting

O Brother, Where Art Thou? – A cautionary tale of conflict in closely-held corporations.

The recent decision of the British Columbia Court of Appeal in  Petersen v Hawley, 2022 BCCA 169 provides excellent perspective on what can happen when two shareholders of a closely-held corporation come to an irreconcilable deadlock. The Court of Appeal ordered liquidation of the closely held company in this case. The decision and its underlying facts highlight that it is wise for prospective business partners to provide direction as to the resolution of future disputes by written agreement.