Transglobal Communications Group Inc., Re, (2009) 473 A.R. 167 (QB)

• Judge: Yamauchi, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: March 20, 2009
• Citations: (2009), 473 A.R. 167 (QB);2009 ABQB 195

Transglobal Com. Group Inc., Re (2009), 473 A.R. 167 (QB)

MLB headnote and full text

Temp. Cite: [2009] A.R. TBEd. AP.040

In The Matter Of the Proposal of Transglobal Communications Group Inc. (BE03-1071018; 2009 ABQB 195)

Indexed As: Transglobal Communications Group Inc., Re

Alberta Court of Queen's Bench

Judicial District of Edmonton

Yamauchi, J.

March 30, 2009.

Summary:

Stone Sapphire Ltd. (Stone Sapphire) and the Kulbabas filed proofs of claim in a bankruptcy proposal. The proposal trustee valued Stone Sapphire's claim at $1 for voting purposes. The proposal trustee disallowed the Kulbabas' claim for voting purposes as "an unliquidated contingent claim". Stone Sapphire and the Kulbabas appealed.

The Alberta Court of Queen's Bench made the following orders: (1) Stone Sapphire's appeal was to be on the record. There would be no de novo hearing; (2) as for the Kulbabas', the parties were to first argue whether the Kulbabas' claim was provable. If the court found that the claim was provable, it could order the proposal trustee to value it.

Bankruptcy - Topic 5445

Meetings of creditors - Procedure - Appeals (incl. standard of review) - [See Bankruptcy - Topic 6886 ].

Bankruptcy - Topic 6885.1

Practice - Appeals - From trustee's decision - Stone Sapphire Ltd. (Stone Sapphire) and the Kulbabas filed proofs of claim in a bankruptcy proposal - The proposal trustee valued Stone Sapphire's claim at $1 for voting purposes - The proposal trustee disallowed the Kulbabas' claim for voting purposes as "an unliquidated contingent claim" - Stone Sapphire and the Kulbabas' appealed - At issue was whether the appeals should be de novo - The Alberta Court of Queen's Bench held that in this case, no one showed that it was in the interests of justice or some other principled basis on which the court should direct an appeal de novo - Accordingly, the appeals would be on the record - See paragraphs 36 to 50.

Bankruptcy - Topic 6885.1

Practice - Appeals - From trustee's decision - The Alberta Court of Queen's Bench held that the fact that the trustee was an officer of the court did not mean that its decisions were not subject to review by the court - See paragraphs 51 to 59.

Bankruptcy - Topic 6885.1

Practice - Appeals - From trustee's decision - The Alberta Court of Queen's Bench held that an appeal against a trustee's decision was a true appeal and not a judicial review - See paragraphs 60 to 62.

Bankruptcy - Topic 6885.1

Practice - Appeals - From trustee's decision - In two separate judgments, the court (1) issued a summary judgment requiring Transglobal to pay Stone Sapphire Ltd. (Stone Sapphire) the sum of $1,710,345.58, and (2) dismissed Transglobal's application for a rehearing based on fresh evidence - Transglobal paid the money into court in return for a stay of execution - A third decision denied Stone Sapphire's application to be declared owner of the money paid into court - Transglobal made a bankruptcy proposal - Stone Sapphire filed a proof of claim which included the summary judgment sum of $1,710,345.58 - The trustee, apparently satisfied that it was not bound by the abovementioned judgments, undertook an independent valuation and valued Stone Sapphire's claim at $1 for voting purposes - Stone Sapphire appealed - At issue was the standard of review - The Alberta Court of Queen's Bench held that the appeal raised an extricable legal question, i.e., whether the trustee was bound by the abovementioned judgments - That question was reviewable on a standard of correctness - As for the actual valuation, that was a matter of fact and discretion reviewable on a standard of reasonableness - The court held that the trustee was incorrect in not giving recognition to the abovementioned judgments - See paragraphs 63 to 82.

Bankruptcy - Topic 6885.1

Practice - Appeals - From trustee's decision - The proposal trustee disallowed the Kulbabas' claim for voting purposes as "an unliquidated contingent claim" - The Kulbabas' appealed - At issue was the standard of review - The Alberta Court of Queen's Bench held that the applicable standard was correctness because the decision to allow or disallow a claim raised a question of law or of statutory compliance - See paragraphs 63 and 74.

Bankruptcy - Topic 6886

Practice - Appeals - From decision of chair of creditors' meeting - The Alberta Court of Queen's Bench held that it did not need to provide any deference in an appeal against a decision of the chair of the meeting of bankruptcy creditors - See paragraphs 22 to 26.

Practice - Topic 5296

Trials - General - Trial or appeal de novo - General - The Alberta Court of Queen's Bench discussed what constituted an appeal de novo - The court stated that one could not ignore the foundational statute on which the appeal was based to determine the type of appeal de novo with which one was dealing - See paragraphs 37 and 38.

Cases Noticed:

Stubicar v. Information and Privacy Commissioner (Alta.) et al. (2008), 440 A.R. 190; 438 W.A.C. 190; 2008 ABCA 357, refd to. [para. 26].

New Brunswick (Board of Management) v. Dunsmuir, [2008] 1 S.C.R. 190; 372 N.R. 1; 329 N.B.R.(2d) 1; 844 A.P.R. 1; 2008 SCC 9, consd. [para. 27].

Dr. Q., Re, [2003] 1 S.C.R. 226; 302 N.R. 34; 179 B.C.A.C. 170; 295 W.A.C. 170; 2003 SCC 19, refd to. [para. 27].

Ryan v. Law Society of New Brunswick, [2003] 1 S.C.R. 247; 302 N.R. 1; 257 N.B.R.(2d) 207; 674 A.P.R. 207; 2003 SCC 20, refd to. [para. 27].

Imperial Oil Resources Ltd. v. 826167 Alberta Inc. (2007), 404 A.R. 212; 394 W.A.C. 212; 2007 ABCA 131, refd to. [para. 27].

San Juan Resources Inc. (Bankrupt), Re (2009), 467 A.R. 391; 2009 ABQB 55 (Reg.), refd to. [para. 27]; consd. [para. 47].

Van Laun, Re; Ex parte Chatterton, [1907] All E.R. 159 (C.A.), refd to. [para. 28].

Lupkovics, Re; Ex parte Freville, [1954] 2 All E.R. 125 (C.A.), refd to. [para. 28].

Canadian Imperial Bank of Commerce v. 433616 Ontario Inc., 1993 CarswellOnt 193 (Gen. Div.), refd to. [para. 28].

Canada Asian Centre Developments Inc. (Bankrupt), Re, [2003] B.C.T.C. 41; 39 C.B.R.(4th) 35; 2003 BCSC 41, refd to. [para. 28].

Eskasoni Fisheries Ltd. (Bankrupt), Re (2000), 187 N.S.R.(2d) 363; 585 A.P.R. 363; 16 C.B.R.(4th) 173 (S.C. Bktcy. Reg.), refd to. [para. 34].

Dunham, Re (2005), 231 N.S.R.(2d) 235; 733 A.P.R. 235; 2005 NSSC 57 (Bktcy. Reg.), refd to. [para. 34].

Lacey (J.J.) Insurance Ltd. (Bankrupt), Re (2008), 274 Nfld. & P.E.I.R. 314; 837 A.P.R. 314; 2008 NLTD 9, refd to. [para. 34].

Non-Marine Underwriters, Lloyd's v. Lacey (J.J.) Insurance Ltd. - see Lacey (J.J.) Insurance Ltd. (Bankrupt), Re.

Erdman (Bankrupt), Re (2005), 276 Sask.R. 10; 2005 SKQB 515 (Bktcy. Reg.), refd to. [para. 34].

Johnson v. Erdman - see Erdman (Bankrupt), Re.

Pushpanathan v. Canada (Minister of Citizenship and Immigration), [1998] 1 S.C.R. 982, addendum [1998] 1 S.C.R. 1222; 226 N.R. 201, refd to. [para. 35].

Galaxy Sports Inc. (Bankrupt), Re (2004), 200 B.C.A.C. 184; 327 W.A.C. 184; 2004 BCCA 284, refd to. [para. 35].

Reform Party of Canada et al. v. Canada (Attorney General) (1995), 165 A.R. 161; 89 W.A.C. 161; 27 Alta. L.R.(3d) 153 (C.A.), refd to. [para. 36].

Ross v. Whissell Estate (Bankrupt) (1999), 237 A.R. 344; 197 W.A.C. 344 (C.A.), refd to. [para. 37].

Ross v. McRoberts - see Ross v. Whissell Estate (Bankrupt).

Taylor v. Workers' Compensation Board (Alta.), [2005] A.J. No. 968 (Q.B.), refd to. [para. 37].

Dickey et al. v. Pep Homes Ltd. et al. (2006), 401 A.R. 149; 391 W.A.C. 149; 2006 ABCA 402, refd to. [para. 37].

679667 Alberta Ltd. v. Allendale Bingo Corp. et al., [2001] A.R. Uned. 440 (Q.B.), refd to. [para. 37].

Primrose Drilling Ventures Ltd. v. Carter et al. (2008), 462 A.R. 385; 2008 ABQB 605, refd to. [para. 37].

Canada (Minister of Human Resources Development) v. Landry (2005), 334 N.R. 176; 31 Admin. L.R.(4th) 13 (F.C.A.), refd to. [para. 37].

Newterm Ltd. v. St. John's (City) (1991), 93 Nfld. & P.E.I.R. 49; 292 A.P.R. 49 (Nfld. T.D.), consd. [para. 38].

Superintendent of Real Estate v. Harder (1980), 28 A.R. 210 (Q.B.), consd. [para. 39].

Haugen v. Camrose (County) and Agricultural Services Board of Camrose (County) (1979), 15 A.R. 451 (C.A.), consd. [para. 40].

SKK Investments Ltd. et al. v. Director of Social Care Facilities Licensing (Alta.) (1994), 150 A.R. 351 (Q.B.), refd to. [para. 41].

MacDonald (Bankrupt), Re, [2002] O.T.C. Uned. 543 (Sup. Ct.), refd to. [para. 43].

Port Chevrolet Oldsmobile Ltd. (Bankrupt), Re, [2002] B.C.T.C. Uned. 740; 49 C.B.R.(4th) 127 (S.C.), affd. (2004), 193 B.C.A.C. 114; 316 W.A.C. 114; 49 C.B.R.(4th) 146 (C.A.), refd to. [para. 43].

Exner (Bankrupt), Re, [2003] B.C.T.C. 260; 41 C.B.R.(4th) 49; 2003 BCSC 260, refd to. [para. 43].

Beetown Honey Products Inc. (Bankrupt), Re, [2003] O.T.C. 866; 46 C.B.R.(4th) 195 (Sup. Ct.), refd to. [para. 43].

Androscoggin Energy LLC, Re (2005), 195 O.A.C. 51; 8 C.B.R.(5th) 11; 2005 CarswellOnt 589 (C.A.), consd. [para. 48].

Royal Oak Mines Inc., Re (1999), 96 O.T.C. 279; 7 C.B.R.(4th) 293; 1999 CarswellOnt 792 (Gen. Div.), consd. [para. 48].

Pezim v. British Columbia Securities Commission et al., [1994] 2 S.C.R. 557; 168 N.R. 321; 46 B.C.A.C. 1; 75 W.A.C. 1, refd to. [para. 51].

Pezim v. Superintendent of Brokers (B.C.) - see Pezim v. British Columbia Securities Commission et al.

Director of Investigation and Research, Competition Act v. Southam Inc. et al., [1997] 1 S.C.R. 748; 209 N.R. 20, refd to. [para. 51].

Khosa v. Canada (Minister of Citizenship and Immigration) (2009), 385 N.R. 206; 2009 SCC 12, consd. [para. 52].

Reed, Re (1980), 34 C.B.R.(N.S.) 83 (Ont. C.A.), refd to. [para. 56].

Confederation Treasury Services Ltd. (Bankrupt), Re (1995), 37 C.B.R.(3d) 237 (Ont. Gen. Div. Bktcy.), refd to. [para. 56].

Page, Re, [2002] O.T.C. 904; 38 C.B.R.(4th) 241 (Sup. Ct.), refd to. [para. 56].

Newfoundland and Labrador Association of Public and Private Employees v. Newfoundland and Labrador (Minister of Justice) et al. (2004), 237 Nfld. & P.E.I.R. 94; 703 A.P.R. 94; 2004 NLSCTD 54, consd. [para. 57].

Roy, Re (1963), 4 C.B.R.(N.S.) 275 (Que. S.C.), refd to. [para. 58].

Touche Ross Ltd. v. Weldwood of Canada Sales Ltd. (1983), 48 C.B.R.(N.S.) 83 (Ont. S.C.), refd to. [para. 58].

Brown (Bankrupt), Re, [2003] A.R. Uned. 670; 48 C.B.R.(4th) 38 (Q.B. Reg.), refd to. [para. 58].

Coffey (Bankrupt), Re (2004), 235 Nfld. & P.E.I.R. 66; 699 A.P.R. 66; 2 C.B.R.(5th) 121 (N.L.T.D.), refd to. [para. 58].

Webber, Re (1931), 12 C.B.R. 274 (N.S.S.C.), consd. [para. 59].

F.E.A. Griffiths Corp., Re (1971), 15 C.B.R.(N.S.) 231 (Ont. S.C.), refd to. [para. 74].

Alberta (Minister of Consumer and Corporate Affairs) et al. v. Bennett et al. (1992), 131 A.R. 184; 25 W.A.C. 184 (C.A.), consd. [para. 80].

Authors and Works Noticed:

Houlden, Lloyd W., Morawetz, Geoffrey B., and Sarra, Janis P., The 2008 Annotated Bankruptcy and Insolvency Act (2007), para. C § 10 [para. 58].

Jones, David Phillip, and de Villars, Anne S., Principles of Administrative Law (4th Ed. 2004), pp. 6 to 8 [para. 60].

Counsel:

Cherisse Killick-Dzenick (Reynolds Mirth Richards & Farmer LLP), for Transglobal Communications Group Inc;

Kenneth W. Fitz (McLennan Ross LLP), for Stone Sapphire Ltd.;

Jeremy H. Hockin (Parlee McLaws LLP), for Meyers Norris Penny Ltd.;

Michael D. Mysak (Bennett Jones LLP), for Joshua and Julia Kulbaba.

This appeal was heard on March 20, 2009, by Yamauchi, J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following decision on March 30, 2009.