Marine Drive Properties Ltd. (Re)

Marine Drive Properties Ltd. (Re)

The initial ex parte CCAA order was set aside because the petitioners did not demonstrate the requisite urgency to justify proceeding without notice and, on substantive review, failed to satisfy s.11 — there was no active operating business, credible evidence showed serious risk of no equity in the key asset,...

Source-derived case information.

Citation
2009 BCSC 145
Parties
Petitioner: Marine Drive Properties Ltd.; Petitioner: Wyndansea Hotel Inc.; Petitioner: 0707624 B.C. Ltd.; Monitor: Ernst & Young Inc.; Secured Creditor (syndicate): Bancorp Financial Services Inc.; Secured Creditor: Bancorp Balanced Mortgage Fund Ltd.; Secured Creditor: Cooper Pacific Mortgage Investment Corporation; Secured Creditor: Liberty Holdings Excell Corp.; Secured Creditor: CareVest Capital Inc.; Secured Creditor: Gulf and Fraser Fishermen's Credit Union; Lien Claimant/contractor: Folio Hotel and Resort Architecture; Lien Claimant/contractor: Ronald Lea Architect Ltd.; Lien Claimant/contractor: William J. Reid Architect Ltd.; Lien Claimant/contractor: Mark Whitehead Architect Ltd.; Lien Claimant/contractor: Jacques Beaudreault Architect Ltd.; Lien Claimant/contractor: Mark E.B. Thompson Architect Ltd.; Creditor/claimant: Bigleaf Ventures Ltd.; Creditor/claimant: Samel Holdings Ltd.; Creditor/claimant: Adrian Karasz; Creditor/claimant: Andriana Karasz; Creditor/claimant: Cy McCullough; Creditor/claimant: Caralyn Patricia Bennett; Creditor/claimant: Dennis Robert Ohman; Creditor/claimant: Leanne Claire Ohman; Creditor/claimant: Keith Charles Shearer; Creditor/claimant: Shelley Rose Price-Shearer
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
10 February 2009
Procedural Posture
Companies' Creditors Arrangement Act Proceeding / Application to Set Aside Initial Order Following Ex Parte Initial Order; Comeback Hearing Scheduled
Outcome
Initial CCAA Order set aside; nunc pro tunc relief declined; matter remitted to scheduled comeback hearing for costs and further directions
Legal Topics
CCAA Initial Order, Ex Parte Relief and Disclosure, Stay of Proceedings, Debtor in Possession Financing (dip), Priming Charges, Foreclosure Vs CCAA
Source Language
english
Insolvency Corporate Law Real Property Civil Procedure CCAA Initial Order Ex Parte Relief and Disclosure Stay of Proceedings Debtor in Possession Financing (dip) +2 more

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Parties

Marine Drive Properties Ltd.

Petitioner

Wyndansea Hotel Inc.

Petitioner

0707624 B.C. Ltd.

Petitioner

Ernst & Young Inc.

Monitor

Bancorp Financial Services Inc.

Secured Creditor (syndicate)

Bancorp Balanced Mortgage Fund Ltd.

Secured Creditor

Cooper Pacific Mortgage Investment Corporation

Secured Creditor

Liberty Holdings Excell Corp.

Secured Creditor

CareVest Capital Inc.

Secured Creditor

Gulf and Fraser Fishermen's Credit Union

Secured Creditor

Folio Hotel and Resort Architecture

Lien Claimant/contractor

Ronald Lea Architect Ltd.

Lien Claimant/contractor

William J. Reid Architect Ltd.

Lien Claimant/contractor

Mark Whitehead Architect Ltd.

Lien Claimant/contractor

Jacques Beaudreault Architect Ltd.

Lien Claimant/contractor

Mark E.B. Thompson Architect Ltd.

Lien Claimant/contractor

Bigleaf Ventures Ltd.

Creditor/claimant

Samel Holdings Ltd.

Creditor/claimant

Adrian Karasz

Creditor/claimant

Andriana Karasz

Creditor/claimant

Cy McCullough

Creditor/claimant

Caralyn Patricia Bennett

Creditor/claimant

Dennis Robert Ohman

Creditor/claimant

Leanne Claire Ohman

Creditor/claimant

Keith Charles Shearer

Creditor/claimant

Shelley Rose Price-Shearer

Creditor/claimant

Procedural Posture

Companies' Creditors Arrangement Act Proceeding / Application to Set Aside Initial Order Following Ex Parte Initial Order; Comeback Hearing Scheduled

Legal Issues

  1. 1 Whether the initial CCAA order should have been granted ex parte
  2. 2 Whether the petitioners met the s.11 CCAA test to grant and continue a stay
  3. 3 Whether there is equity in the Wyndansea Lands sufficient to justify priming lenders

Ratio Decidendi

The initial ex parte CCAA order was set aside because the petitioners did not demonstrate the requisite urgency to justify proceeding without notice and, on substantive review, failed to satisfy s.11 — there was no active operating business, credible evidence showed serious risk of no equity in the key asset, foreclosure proceedings provided adequate protection, and any restructuring was objectively doomed to fail such that continuing the stay and approving priming DIP financing would unjustifiably prejudice creditors.

Court Disposition

Initial CCAA Order set aside; nunc pro tunc relief declined; matter remitted to scheduled comeback hearing for costs and further directions

Orders

  • Initial order dated January 15, 2009 is set aside
  • Application for nunc pro tunc validation of the order is declined