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The Oppression Remedy: A Back-Door for Equitable Subordination in Insolvency Cases?
September 19, 2007
In 2004 in Peoples Department Stores Inc. (Trustee of) v. Wise, the Supreme Court of Canada described the oppression remedy as "grant[ing] the broadest rights to creditors of any common law jurisdiction." It is now clear that creditors may rely upon the sweeping powers of the oppression remedy, despite numerous statutes dedicated to mediating the relationship between creditors and both solvent and insolvent debtor corporations. This development, however, is not without tension. How does an equitable remedy like the oppression remedy fit in with the strict statutory regimes governing creditor and debtor relations? Are there or should there be limits to the court's power where the oppressed party is a creditor rather than a shareholder? This paper was presented at the Insight Conference, Dealing with Dissent and Oppression, Actions and Remedies (September 19-20, 2007).