The general rule in bankruptcy is that a debtor receives a “fresh start” and is discharged from prior debts, but this is subject to certain exceptions. Subsection 178(1) of the Bankruptcy and Insolvency Act (BIA) sets out eight classes of debts that are not released by an order of…

Mareva orders, also known as freezing orders, may be granted when there is a risk that a defendant might move its assets out of reach of the court’s jurisdiction. Mareva orders can freeze assets owned directly or indirectly by a defendant. Oftentimes a defendant subject to…

In a decision released in 2023, Justice Vermette of the Ontario Superior Court rejected an application to set aside an arbitration award on procedural fairness and jurisdictional grounds. This decision clarified when Ontario’s International Commercial Arbitration Act (the “ICAA”) applies and confirmed that arbitration awards may…

In Ontario, as a general rule, partial indemnity, which ranges from approximately 40-60% of the actual costs incurred by a party, is awarded to the successful litigant. Full indemnity, which comprises 100% of the costs incurred, is granted only in exceptional and rare circumstances. An order…

Can individuals take steps to make themselves ‘creditor proof’ against future creditors, even when there is no such creditor at the time? If there are sufficient “badges of fraud” present, the answer may be no.

In a post last year, we discussed the decision of the British Columbia Court of Appeal in Poonian v. British Columbia (Securities Commission), 2022 BCCA 274 in which the British Columbia Court of Appeal held that an administrative penalty by a securities commission relating to fraud…

Background In Li et al. v. Barber et al., the Ontario Superior Court of Justice dismissed a motion by two “Freedom Convoy” organizers to release $200,000 of previously frozen funds needed to retain legal counsel to defend a class action lawsuit. Notwithstanding the nuances of this…

A bankruptcy discharge releases the debtor from pre-bankruptcy debts or liabilities. The purpose is to give the debtor a “fresh start” from excessive debts that cannot be repaid, except in certain situations such as where the debt arises from deceitful or fraudulent conduct. In Poonian v.…

Aiden Pleterski, the self-described “Crypto King”, and his company AP Private Equity Limited were petitioned into bankruptcy on August 9, 2022 on application by certain of their creditors. David Gadsden, Michael Nowina and Ben Sakamoto at Baker McKenzie act for the creditors who brought the bankruptcy applications.

A preferential transaction occurs where an insolvent person or debtor makes a transfer of property or a payment that has the effect of favouring one creditor over another. Creditors and bankruptcy trustees can use federal or provincial legislation to attack preferential transactions. A recent Ontario Court…

In a previous post, we discussed disgorgement as an alternative remedy to compensatory damages in cases where a fraudster has profited from the wrongful acts. In a recent Ontario Superior Court decision, Justice Koehnen granted a $10.2 million disgorgement order to return ill-gotten profits made by…

When a plaintiff suffers a loss due to the misconduct of a defendant, the typical approach is to award damages that reflects the loss. However, this does not always fit the circumstances of the breach. In some cases, a plaintiff may have suffered no damages, but…