Sino-Forest: Resolving Intercreditor Disputes in the CCAA
Written by Robert W. Staley, Derek J. Bell, and Amanda McLachlan
Almost ten years ago, Justice Farley commented in Stelco Inc. (Re.) that the Companies' Creditors Arrangement Act [CCAA] was styled as an “Act to facilitate compromises and arrangements between companies and their creditors,” and there was “no mention of this extending by statute to encompass a change of relationship among the creditors vis-à-vis the creditors themselves and not directly involving the company.” And for the most part, this conclusion of law is unassailable: the CCAA is designed not to be the panacea for all grievances but rather to facilitate a compromise of claims against an insolvent company. It would be unduly problematic to hold up a compromise of claims between a debtor and its creditors for a resolution of all disputes that might exist among creditors—the disputes that are unrelated to or do not affect the distribution from the debtor. Published in the August 2013 edition (Volume 25, Nos. 5 & 6) of Commercial Insolvency Reporter.