Mercy Falls BC Inc. (Re)

Mercy Falls BC Inc. (Re)

Because Mercy Falls LLC failed to file the required application response as ordered and the petitioner satisfied Rule 3-8 filing requirements, default judgment was appropriate; the damages claimed were susceptible to summary assessment on detailed affidavit evidence in the CCAA context without being patently unjust, and the petitioner proved damages of $4,736,455 to September 30, 2025; leave was granted to seek further assessments for amounts after October 1, 2025, and pre- and post-judgment interest was allowed to be assessed.

Citation
2025 BCSC 2492
Parties
Petitioner: Mercy Falls BC Inc.; Respondent/defendant: Mercy Falls LLC; Monitor: MNP Ltd.; Interim Lender: National Bank of Canada
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
23 October 2025
Procedural Posture
CCAA Petition With Contractual Claim in Companion Civil Proceeding / Application for Default Judgment and Summary Assessment of Damages
Outcome
Default judgment granted against Mercy Falls LLC; damages summarily assessed to September 30, 2025; leave granted to apply for further assessment for amounts after October 1, 2025; pre- and post-judgment interest allowed to be assessed.
Legal Topics
Default Judgment, Summary Assessment of Damages, Mitigation of Loss, Procedural Modification Under CCAA S.11, Pre and Post Judgment Interest, Procedural Orders
Source Language
English
Insolvency/ccaa Contract Law Civil Procedure Commercial Litigation Interest Law Default Judgment Summary Assessment of Damages Mitigation of Loss +3 more

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Parties

Mercy Falls BC Inc.

Petitioner

Mercy Falls LLC

Respondent/defendant

MNP Ltd.

Monitor

National Bank of Canada

Interim Lender

Procedural Posture

CCAA Petition With Contractual Claim in Companion Civil Proceeding / Application for Default Judgment and Summary Assessment of Damages

Legal Issues

  1. 1 Whether default judgment should be entered against Mercy Falls LLC for failing to file an application response
  2. 2 Whether damages may be summarily assessed under Rule 3-8(13) in the CCAA context
  3. 3 Whether the petitioner’s claimed quantum of $4,736,455 to September 30, 2025 is established on affidavit evidence

Ratio Decidendi

Because Mercy Falls LLC failed to file the required application response as ordered and the petitioner satisfied Rule 3-8 filing requirements, default judgment was appropriate; the damages claimed were susceptible to summary assessment on detailed affidavit evidence in the CCAA context without being patently unjust, and the petitioner proved damages of $4,736,455 to September 30, 2025; leave was granted to seek further assessments for amounts after October 1, 2025, and pre- and post-judgment interest was allowed to be assessed.

Court Disposition

Default judgment granted against Mercy Falls LLC; damages summarily assessed to September 30, 2025; leave granted to apply for further assessment for amounts after October 1, 2025; pre- and post-judgment interest allowed to be assessed.

Orders

  • Default judgment entered against Mercy Falls LLC on the Contract Claim.
  • Damages under the default judgment are summarily assessed in the amount of $4,736,455 as of September 30, 2025.