Purcell Basin Minerals Inc. (Re)

Purcell Basin Minerals Inc. (Re)

The court granted the initial CCAA order because the petitioners are insolvent, immediate unsecured funding from 1974315 was necessary and only available if an initial order were granted to preserve the mine and its assets, appointment of MMP as monitor and an administration charge up to $300,000 were appropriate to facilitate an orderly claims process and preserve value, and there was insufficient evidence to support a directors' charge; the comeback hearing was scheduled for the week of June 25, 2018.

Citation
2018 BCSC 949
Parties
Petitioner: Purcell Basin Minerals Inc.; Petitioner: Bul River Mineral Corporation; Petitioner: Gallowai Metal Mining Corporation; Petitioner: Grand Mineral Corporation; Petitioner: Jao Mine Developers Ltd.; Petitioner: Stanfield Mining Group of Canada Ltd.; Secured Creditor: Highland Pacific Partners LLP; Proposed Monitor: MMP; Funding Provider: 1974315 Alberta Ltd.; President and Shareholder: Mr. Radford; Shareholder: Peter Lacey
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
29 May 2018
Procedural Posture
Companies' Creditors Arrangement Act Initial Order Application / Oral Reasons for Judgment Initial Order Granted
Outcome
Initial order under s.11.02(1) CCAA granted
Legal Topics
CCAA Initial Order, Interim Financing (dip), Stay of Proceedings, Monitor Appointment, Priority of Charges, Good Faith and Due Diligence
Source Language
English
Insolvency Corporate Law Secured Transactions Commercial Litigation CCAA Initial Order Interim Financing (dip) Stay of Proceedings Monitor Appointment +2 more

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Parties

Purcell Basin Minerals Inc.

Petitioner

Bul River Mineral Corporation

Petitioner

Gallowai Metal Mining Corporation

Petitioner

Grand Mineral Corporation

Petitioner

Jao Mine Developers Ltd.

Petitioner

Stanfield Mining Group of Canada Ltd.

Petitioner

Highland Pacific Partners LLP

Secured Creditor

MMP

Proposed Monitor

1974315 Alberta Ltd.

Funding Provider

Mr. Radford

President and Shareholder

Peter Lacey

Shareholder

Procedural Posture

Companies' Creditors Arrangement Act Initial Order Application / Oral Reasons for Judgment Initial Order Granted

Legal Issues

  1. 1 Whether an initial order under s.11.02(1) CCAA should be granted to preserve assets and permit restructuring
  2. 2 Whether interim financing and an administration charge should be granted priority over other claims
  3. 3 Whether a monitor should be appointed

Ratio Decidendi

The court granted the initial CCAA order because the petitioners are insolvent, immediate unsecured funding from 1974315 was necessary and only available if an initial order were granted to preserve the mine and its assets, appointment of MMP as monitor and an administration charge up to $300,000 were appropriate to facilitate an orderly claims process and preserve value, and there was insufficient evidence to support a directors' charge; the comeback hearing was scheduled for the week of June 25, 2018.

Court Disposition

Initial order under s.11.02(1) CCAA granted

Orders

  • Initial CCAA order granted to Purcell Basin Minerals Inc. and related petitioners
  • MMP appointed as monitor of the petitioners' proceedings