Canada Case Law

Glencore Canada Corporation v. FTI Consulting Canada Inc.

Court

British Columbia Court of Appeal

HST payable under the ETA is a tax debt owed to the Crown and collected by the supplier as agent/trustee; because the HST was not a liability owed to the supplier in its personal capacity (and s.224 did not apply as the supplier had not remitted), the mutuality requirement for contractual set-off was not met and Glencore could not set off HST against supplier liabilities; the supervising judge properly exercised her s.11 CCAA discretion to order Glencore to pay unpaid HST to the Receiver as agent for CRA, but it was unreasonable to require Glencore to pay interest and penalties assessed again…

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• Hst/gst
• Excise tax act
• Set-off (contractual and equitable)
• Companies' creditors arrangement act (s.11, s.21)
• Receivership
• Deemed trust

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CHU de Québec-Université Laval v. Tree of Knowledge International Corp.

Court

Court of Appeal for Ontario

The Ontario Court of Appeal dismissed an appeal in a COVID-era mask supply fraud case, upholding findings of recklessness and personal liability against a corporate officer.

• Civil fraud (deceit)
• Recklessness standard
• Personal liability of directors and officers
• Piercing the corporate veil
• Damages and restitution
• Bankruptcy and insolvency act s.178(1)(e)

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Moonraker Ventures Ltd. v. Veri

Court

Supreme Court of British Columbia

The court found Veri qualified as a "farmer" under the Act (field-grown cannabis and cattle constitute farming carried on for commercial purposes), and either found him insolvent or held insolvency is not a precondition to the creditor's duty to give s.21 notice; Moonraker failed to provide the notice in the form established by the Minister and omitted essential information, and because s.22 makes acts done in contravention of s.21 null and void without statutory discretion to validate them, the foreclosure proceedings are void ab initio.

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• Farm debt mediation act s.21 notice requirements
• S.22 nullity remedy
• Definition of "farmer" and commercial purpose
• Eligibility for stay under s.5 and insolvency under s.6
• Notice sufficiency and form
• Remedial statutory interpretation

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Rona Inc. v. Rockhard Construction Limited

Court

Supreme Court of Nova Scotia

The Court found on the balance of probabilities that Greater Construction Inc. incurred and owed the $253,107.49 debt as evidenced by Rona’s Aged Trial Balance and supporting business records; the corporate veil of Greater Construction was pierced because its directing mind, Saeid Saberi, exploited the company as his alter ego, engaged in dishonest conduct and failed to disclose documents, justifying an adverse inference and personal liability; other corporate entities and individuals (including Navid Saberi) were not shown to be similarly liable; prejudgment interest at 5% per annum for five…

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• Piercing corporate veil
• Directing mind liability
• Debt recovery
• Personal guarantees
• Pre-judgment interest
• Disclosure and adverse inference

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Timeless Pictures Inc. v. Chandler

Court

Supreme Court of British Columbia

A prima facie inability to pay was established by the pleadings and supporting evidence (bank balances, significant recent legal fees, management fees, large intercorporate debt and unclear recovery of receivables); balancing the risk of a dry judgment against any stifling of the plaintiffs' claim, the court exercised its discretion under s.236 BCA to order security for costs in the reduced amount of $60,000 to be posted by May 3, 2026 and held interest-bearing in plaintiffs' counsel trust account, stayed the action pending compliance, and declined to order a personal undertaking by the major…

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• Security for costs
• Conflict of interest
• Shareholder dispute
• Asset transfers
• Personal indemnity/undertaking

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The Toronto-Dominion Bank (TD Canada Trust) v. Canada

Court

Federal Court of Appeal

Interpreting ss.227(4) and (4.1) of the Income Tax Act textually, contextually and purposively, the court held that Parliament did not clearly preclude the equitable bona fide purchaser for value defence against recovery from an unsecured creditor who in good faith received proceeds of a tax debtor; therefore an unsecured creditor who received proceeds without notice may rely on the bona fide purchaser defence and is not required to forfeit those proceeds to the Crown in the factual circumstances described.

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• Deemed trust
• Source deductions
• Bona fide purchaser defence
• Priority of crown claims
• Tracing
• Deemed statutory trust vs secured creditors

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GEC (Richmond) GP Inc. v. Romspen Investment Corporation

Court

British Columbia Court of Appeal

The syndication condition did not permit Romspen to terminate its separate $212,000,000 lender commitment; Romspen's refusal to advance further funds on March 31, 2020 based solely on syndication constituted a breach of the Loan Agreement unless Romspen can establish entitlement to cease funding under other contractual conditions, which remain remitted to the trial court to determine.

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• Loan agreement interpretation
• Syndication conditions
• Subordination agreements
• Breach of contract
• Repudiatory breach
• Implied terms

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TR3 Geothermal Services Inc. v. Mason

Court

Supreme Court of British Columbia

The court allowed the judicial review and set aside a Provincial Court order piercing TR3’s corporate veil and imposing personal liability on Mr. Saari.

• Piercing corporate veil
• Res judicata
• Functus officio
• Standard of review
• Small claims procedure
• Payment hearing

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Alyange Holdings Inc. v. Dewdney Mountain Farms Ltd.

Court

Court of Appeal for Ontario

The Ontario Court of Appeal enforced a settlement agreement in a mortgage enforcement dispute and dismissed the appeal, holding the appellants had given up their s. 244 BIA objection.

• Mortgage enforcement
• Settlement agreement enforcement
• Bankruptcy and insolvency act s.244 notice
• Forbearance of execution
• Consent to judgment
• Stay of proceedings

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Laliberté v. Québec Revenue Agency

Court

British Columbia Court of Appeal

La Cour d’appel de la Colombie-Britannique rejette une demande d’autorisation d’appel visant à faire annuler une condamnation pénale québécoise liée à des retenues à la source.

• Ccaa stay of proceedings
• Regulatory/penal proceedings exempt from ccaa stay
• Jurisdictional interplay federal/provincial
• Leave to appeal criteria
• Ccaa-stay-of-proceedings
• Penal-proceedings

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