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Bankruptcy Cases
Bankruptcy
24
Law
Undergraduate 4
12/13/2014

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Cards

Term
Prolife United Industries Ltd. v. Coopers & Lybrand
Definition
Transfers of assets to delay, hinder, or defraud, a potential judgement for a creditor is considered fraudulent under the Statute of Elizabeth. Courts need to determine whether the value of the transaction is significant, and whether the parties to the transaction were related.
Term
Standard Trustco Ltd. (trustees of) v. Standard Trustco Ltd.
Definition
This case shows that whether or not a transaction is reviewed under the BIA is up to the courts discretion. The courts look at the market value of the transaction and the relationship between parties to determine whether the transaction should be reviewed.
Term
Peoples Department Stores Inc. (trustees of) v. Wise
Definition
This case covers the relationship between parties of a transaction and market value in determining fraudulent conveyance. It was shown that even though a transaction may be far below market value, the transaction may not be considered frudulent as the courts must consider all relevant costs and the fiduciary duty/relationship between all parties.
Term
Re Lehndorff General Partners Ltd.
Definition
The purpose of the BIA/CCAA is to create an environment that allows the debtor to get back onto its feet if it is in the benefit of all parties involved. Sometimes it makes sense to restucture instead of breaking up a company and redistributing its assets, as the company as a whole is worth more than the sum of its individual parts.
Term
Re Stelco Inc.
Definition
The courts determined that the CCAA should be viewed as a remedial measure, not a preventative measure. That is to say that the CCAA should be implemented when it is reasonably forseeable that a company will become bankrupt, not after a company is bankrupt and in the "death spiral". The CCAA allows the company to continue growth during the stay of proceedings, which benefits all creditors.
Term
Saulnier v. Royal Bank
Definition
This case shows that a license can be considered property under the PPSA if the license represents rights in property or rights to future economic benefit (cashflows).
Term
Commercial Credit Corp. Ltd. v. Harry Shields Ltd.
Definition
A landlords lien is non-consentual, and takes priority over interest registered under the PPSA. The PPSA does not apply to non-consentual agreements.
Term
Re: Urman
Definition
Lnad is not covered by the PPSA, and interests in land are given priority to interests registered under the PPSA. In this case, the assignment of a mortgage to a creditor was interpreted as a mortgage of a mortgage, and was thus considered interest in land and given priority in collateral.
Term
356447 British Columbia Ltd. v. CIBC
Definition
It is the substance of the agreement that matters, not the actual wording. In this case, a security agreement had been created but not registered. The courts found that although not registered, the intent was to create a security agreement and the agreement was still enforceable.
Term
Atlas Industries v. Federal Business Development Bank: S.K.T.N. Farm and Truck Equipment Ltd. (Debtor)
Definition
Agreements must be consentual, within the intentions of both parties, and entered into by an individual with the capacity to enter into such an agreement. Writing is important to create evidence of an agreement, because if there is not enough evidence of the intention to create an agreement it may be held void.
Term
Kinetics Technology v. Fourth National Bank of Tulsa
Definition
This case shows the importance of registration, as it gives the registered interest priority over unsecured interests.
Term
R. v. Canadian Imperial Bank of Commerce
Definition
"No one gives what they do not have". Proceeds achieved through crime cannot be used as collateral as the debtor does not have rights to the property, or the power to transfer their rights, as he himself has no rights to the property.
Term
Re: Raymond Darzinskas
Definition
Possession to create perfection can be attained by physically possessing property or making it unoperable. If a creditor allows a debtor to continue using property, a debtor has physical possession of the property, or the creditor makes it appear as though the debtor still has rights in the property, the creditor may not be considered to have possession and perfection.
Term
Sperry Inc. v. Canadian Imperial Bank of Commerce
Definition
Possession cannot be taken by a creditor if the creditor is also in receivership; the creditor is acting as both the debtor and creditor. This would lead to bias and a conflict of interest.
Term
Re: Lambert
Definition
Mistakes in registration are only able to render the registration void if they are material. To determine materiality, the courts use a reasonable person test. "Would a reasonable perosn be able to find the registration through a search if this mistake existed?"
Term
The Robert Simpson Company Ltd. v. Shadlock & Duggan
Definition
This case highlights the subordination of unperfected interest to perfected interest, and the PPSAs scope above prior special priority rules, current common law, and equitable rules.
Term
Royal Bank of Canada v. General Motors
Definition
A-B-C rules and the transfer of priority. The party receiveing higher priority has rights to collateral up to the amount owed to them, or up to the amount of the party which subordinated their rights to them, whichever comes first. The remaining proceeds, if any, are distributed according to the remaining priority listings.
Term
Agricultural Credit Corp. of Saskatchewan v. Pettyjohn
Definition
To create a PMSI, the creditor must supply the debtor with value that is to be used by the debtor to acquire more rights or assets, and the funds must be used to acquire said rights or assets. PMSI is given special priority, and proceeds can be traced up to the amount of the original collateral value.
Term
Unisource Canada Inc. v. Laurentian Bank of Canada
Definition
It is the substance of the agreement, not what you call it, that matters. Whether an interest forms a PMSI or not is up to the courts discretion.
Term
Clark Equipment of Canada Ltd. v. Bank of Montreal
Definition
descriptions of collateral need not be very descriptive, just descriptive enough to identify the collateral. If a PMSI can be traced in proceeds it is still enforceable up to the amount of the original collateral.
Term
Royal Bank of Canada v. 216200 Alberta Ltd.
Definition
This case outlines the requirements that must be met for s. 30(2) of the PPSA to apply to transactions. The sale must be in the ordinary course of business, and the debtor must have rights in the goods or the power to transfer rights for a buyers rights to be given priority over secured parties. The relationship between the buyer and seller must amount to a sale as defined by the PPSA, and the sale must be in the ordinary course of business.
Term
Flintoft v. Royal Bank of Canada
Definition
There is a right to follow proceeds if collateral is sold, or otherwise disposed of.
Term
Agricultural Credit Corp. of Saskatchewan v. Pettyjohn
Definition
This case draws the connection between the proprietary rules of tracing under common law and equity, and the rules of the PPSA governing the extension of a security interest in collateral to proceeds of that collateral.
Term
Flexi-Coil v. KDC
Definition
Although the secured party usually gains priority over those with unsecured interests, if they cannot trace proceeds they may not be given priority.
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