Bankruptcy and Insolvency for Transactional Lawyers: Panel Discussion

• Author: Geoffrey B. Morawetz (Moderator), Mr. Justice James M. Farley, John T. Evans, Murray A. McDonald, and Murray S. Gold
• Pages: 27-45

Bankruptcy

and

Insolvency

for

Transactional Lawyers

Panel

Discussion

MR.

GEOFFREY

MORAWETZ:*

Today,

our

panel will

be

talking about bank-

ruptcy

and

insolvency

for

transactional lawyers.

It is

real-time

law and

a

real-time panel.

When

you

organize

a

panel months

in

advance

of a

program,

it has

both advantages

and

disadvantages.

The

advantage

is the

ability

to

invite panellists

who are

involved

in

files

that

are on the

front

page

of

the

business

news.

In

this case,

it was

expected that

the Air

Canada

restructuring, which started

on

April

1,

2003,

would have been complet-

ed

long

before

this program.

The Air

Canada

file

is not

finished

and it

is

now

sharing

front

page news with another large restructuring, name-

ly,

Stelco Inc.

On the

positive side,

the

panel

is

comprised

of

individuals

who

have demonstrated great

flexibility

and the

topics being discussed

are

very

current. However,

the

disadvantage

of

being

so

current

is

that

because

our

panellists have

not

finished

certain aspects

of

their work,

they

may be

somewhat constrained

in

making certain comments about

their ongoing

files.

However, they have indicated that they

are

free

to

talk

about many

of the

current issues that

are

being

faced

in

restructur-

ing

files

today.

The

Special Lectures

this

year

are

devoted

to

corporate

and

com-

mercial

law.

The two

significant

cases that

are

currently ongoing,

Air

Of

Goodmans

LLP.

27

28

PANEL

DISCUSSION

Canada

and

Stelco,

are,

for the

most

part,

corporate

transactions,

but,

obviously, they take

on

another level

of

complexity when

the

corporate

transaction

intersects

with insolvency.

The

result

is

quite clear.

The

bankruptcy

and

insolvency lawyer

of

yesterday

is now

referred

to as a

corporate restructuring lawyer.

We

have

four

speakers

on our

panel today.

The

first

to be

intro-

duced

is the

Honourable

Mr.

Justice James

Farley.

Mr.

Justice Farley

has

been

the

leading judge

on the

Commercial

List

since

its

inception

in

1991.

At the

current time,

he is

supervising

the

CCAA1

filings

of

Ivaco,

Slater Steel,

Air

Canada,

and

Stelco.

Mr.

Justice Farley will

be

talking

about inherent jurisdiction

as

well

as the

court supervised sales process.

Next

to Mr.

Justice Farley

is Mr.

John Evans

of

Osier, Hoskin

&

Har-

court LLP.

Mr.

Evans will

be

addressing

us on

directors'

liabilities,

a

very topical subject

in

view

of the

fact

that

the

Supreme Court

of

Cana-

da

will shortly

be

hearing

an

appeal

from

Quebec

in the

case

of

Peoples

Department

Store

v.

Wise2

where

the

issue

of

directors'

liability

in the

con-

text

of an

insolvent corporation

is the

central issue.

Mr.

Evans

has

been

representing Trinity Time Investments

in the Air

Canada restructuring.

We

will then hear

from

Mr.

Murray McDonald, president

of

Ernst

&

Young Inc.,

on the

issue

of

pensions

and

collective

agreements

in the

context

of an

insolvency.

Mr.

McDonald

is

currently extremely busy

as

Ernst

&

Young Inc.

is the

court-appointed

monitor

in the

CCAA filings

of

both

Air

Canada

and

Stelco.

Mr.

McDonald will also

be

talking about

negotiating

the

necessary balance

between

the

various

constituents

who

make claims

in the

restructuring process.

Finally,

Murray Gold

of

Koskie Minsky

LLP

will address

us in the

area

of

labour relations

and

collective agreements.

We

have

had

signifi-

cant developments

in

this area

of the law as,

very recently,

the

Ontario

Court

of

Appeal handed down

its

decision

in

TCT

Logistics3

and I

expect

that

Mr.

Gold will

be

providing commentary

on

this case.

In my

introductory remarks,

I

have made reference throughout

to

both

Air

Canada

and

Stelco.

Not

only

by

their sheer size

are

these enti-

ties dominating

the

insolvency landscape today,

but it

also

forces

us to

1

Companies'

Creditors

Arrangement

Act

(Canada),

R.S.C.

1985,

c.

C-36

[CCAA].

2

Peoples

Department

Stores

Inc.

(Trustee

of)

v.

Wise

(2003),

41

C.B.R.

(4th)

225

(Que.

C.A.). Note appeal

dismissed

with costs

on

October

29,

2004

at

[2004]

S.C.J.

No. 64.

3

GMAC

Commercial

Credit

Corp.

-

Canada

v.

T.C.T.

Logistics

Inc.

(2004),

48

C.B.R.

(4th)

256

(Ont.

C.A.)

[TCT

Logistics].