Government measures in key jurisdictions 2nd edition final pages - Flipbook - Page 22
Canada
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Insolvency
While Canada’s main insolvency statutes, the Bankruptcy and Insolvency Act (BIA)
and Companies’ Creditors Arrangement Act (CCAA) have not been amended at the
time of writing, new legislation and amendments to existing legislation do impact the
Has the
government made insolvency process. In addition, guidance from other participants in the insolvency
regulatory process will affect insolvency practice and procedures. The following are
any changes
some examples.
to insolvency
legislation?
•
As part of the federal government’s CERB program, the income support benefit
provided will not be subject to the operation of any law relating to bankruptcy and
insolvency.
Contractual
Issues
What measures
have been taken
to reinforce
contracts?
•
Several provinces have enacted legislation to temporarily suspend limitation
periods, which apply to the insolvency process.
•
The Office of the Superintendent of Bankruptcy Canada, which regulates Licensed
Insolvency Trustees (LITs) and is the regulator under the BIA and CCAA, has
recommended that LITs work with debtors and third parties to ensure that they
are handling insolvencies in a flexible manner that is the least prejudicial to
individuals in financial distress. Under the BIA, the courts have broad authority to
allow bankruptcy cases to move forward in irregular circumstances if the courts
believe it is appropriate.
Each Canadian province has its own legislation outlining the requirements for doing
business electronically and using eSignatures. In Ontario, British Columbia and Alberta,
barring a few important exceptions, eSignatures may be utilized for closing transactions
to create binding obligations.
Documents requiring a traditional “wet ink” signature include:
•
wills, codicils and trusts created by wills or codicils,
•
powers of attorney regarding an individual’s financial affairs or personal care,
•
negotiable instruments (such as certificated securities and negotiable promissory
notes),
•
beneficiary designations (such as for life insurance),
•
certain real estate matters, and
•
documents that are from time to time prescribed or that belong to a prescribed class.
With regard to real estate matters, parties may use eSignatures to sign documents
that create or transfer an interest in land. However, it is important to note that certain
restrictions may apply depending on the applicable province.
For a more detailed explanation, see the Cassels Comment located here.
Other contractual matters, including material adverse effect and material adverse change
provisions and Force Majeure clauses, have been impacted by the effects of COVID-19.
For more information, see additional Cassels Comments located here and here.
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Government measures in key jurisdictions
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