Wolfridge Farm Ltd. (Re)

Wolfridge Farm Ltd. (Re)

The presumption that the registered office in Connecticut established WFL's COMI there was rebutted by objective evidence (location of assets, majority of unsecured creditors, history and connections to Nova Scotia, lack of credible evidence of significant U.S. asset value and misleading conduct by the company's agent), therefore the COMI is Nova Scotia and the U.S. Chapter 11 proceeding is not recognized as a foreign main proceeding; additionally FCC's foreclosure is exempt under s.271(3).

Citation
2015 NSSC 168
Parties
Applicant Debtor: Wolfridge Farm Ltd.; Respondents Secured Creditors: Gerald P. Bonang and Dianne Bonang; Respondent Secured Creditor: Farm Credit Canada
Court
Supreme Court of Nova Scotia
Jurisdiction
Canada
Judgment Date
5 June 2015
Procedural Posture
Bankruptcy and Insolvency / Application for Recognition of Foreign Proceeding Under S.270 BIA
Outcome
U.S. Chapter 11 proceeding not recognized as a foreign main proceeding; Wolfridge Farm Ltd.'s COMI found to be Nova Scotia; secured creditor Farm Credit Canada's foreclosure exempt under s.271(3).
Legal Topics
Recognition of Foreign Proceedings, Centre of Main Interests (comi), Section 270 and 271 BIA Effects/exceptions, Abuse of Process, Secured Creditor Rights/foreclosure
Source Language
English
Bankruptcy and Insolvency Cross Border Insolvency Property/foreclosure Recognition of Foreign Proceedings Centre of Main Interests (comi) Section 270 and 271 BIA Effects/exceptions Abuse of Process Secured Creditor Rights/foreclosure

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Parties

Wolfridge Farm Ltd.

Applicant Debtor

Gerald P. Bonang and Dianne Bonang

Respondents Secured Creditors

Farm Credit Canada

Respondent Secured Creditor

Procedural Posture

Bankruptcy and Insolvency / Application for Recognition of Foreign Proceeding Under S.270 BIA

Legal Issues

  1. 1 Whether the U.S. Chapter 11 proceeding qualifies as a foreign main proceeding under s.270/268 BIA
  2. 2 Whether Wolfridge Farm Ltd.'s centre of main interests (COMI) is in Connecticut (U.S.) or Nova Scotia (Canada)
  3. 3 Whether conduct of officers/agents amounted to abuse of process disentitling recognition

Ratio Decidendi

The presumption that the registered office in Connecticut established WFL's COMI there was rebutted by objective evidence (location of assets, majority of unsecured creditors, history and connections to Nova Scotia, lack of credible evidence of significant U.S. asset value and misleading conduct by the company's agent), therefore the COMI is Nova Scotia and the U.S. Chapter 11 proceeding is not recognized as a foreign main proceeding; additionally FCC's foreclosure is exempt under s.271(3).

Court Disposition

U.S. Chapter 11 proceeding not recognized as a foreign main proceeding; Wolfridge Farm Ltd.'s COMI found to be Nova Scotia; secured creditor Farm Credit Canada's foreclosure exempt under s.271(3).

Orders

  • Do not recognize the U.S. Chapter 11 proceeding as a foreign main proceeding under s.270/268 BIA
  • Declare that Farm Credit Canada's foreclosure proceedings are exempt and may proceed pursuant to s.271(3) of the BIA