With respect to the NL PBA deemed trust, the Court concluded that it covers missed special payments and the wind-up deficits in the Plans, as they relate to NL Plan members; however, the Court ultimately determined that the Company’s CCAA filing rendered the NL PBA deemed trust ineffective as a result of the doctrine of federal paramountcy.Specifically, the Court reasoned that because the CCAA provides for certain limited protections for normal cost contributions only,[5] it would frustrate Parliament’s purpose to also recognize a provincial pension priority for special payments and the wind-up deficit.

Liquidating ccaa video

With respect to the PBSA deemed trust, the Court concluded that the deemed trust covers missed special payments, and special payments due in the year of plan termination; however, the Court resolved the different priorities created in the CCAA and PBSA, both federal statutes, in favour of the CCAA regime, again for the reasons that Parliament’s purpose in adopting certain changes to the CCAA in 2009 was to protect normal cost contributions only, and that the CCAA reflects Parliament’s intent in the matter.

In coming to its conclusion that the NL PBA deemed trust is ineffective in a liquidating CCAA for reasons of federal paramountcy, the Court confirmed that pension claims are part of the scheme of distribution under the BIA and any attempt by the provinces to change that scheme of distribution is inoperative.

Because the reasoning for rendering ineffective the NL PBA deemed trust is easily applicable to pension deemed trusts in any other Canadian jurisdiction, and any other liquidating CCAA, we expect this decision to be of great interest to pension stakeholders and lenders across the country.

It is unclear whether the reasoning would equally apply in a restructuring CCAA.

This issue is somewhat obvious, but important as the vast majority of the proceeds available for distribution in the Wabush CCAA relate to assets located in Quebec.

We expect Wabush to be appealed and for any such appeal to focus on the effectiveness of the pension deemed trusts, and appropriate distribution scheme applicable in a “liquidating CCAA”.[3] White Birch Paper Holding Company (Arrangement relatif à) 2014 QCCS 4709 (Can LII) (White Birch).[4] Timminco ltée (Arrangement relatif à), 2014 QCCS 174 (Timminco). 264 of the SPPA, which renders certain amounts payable to a pension fund to be “unseizable” as effectively providing for the necessary second ingredient. In addition to our regular guest bloggers, Inside Internal Controls blog published by First Reference, provides occasional guest post opportunities from various subject matter experts on the topics of risk management and best practices in finance and accounting, information technology, environmental issues, corporate governance, sales/marketing and operations, not-for-profits and business related issues in Canada.The Court made four significant findings, each of which is discussed in detail below: On items 2 and 3, the reasoning and results in Wabush are consistent with the Supreme Court of Canada (SCC) decision in Century Services, but diverge from the SCC’s later reasoning in Indalex. This is a case to watch in an evolving area of law. and certain of its affiliates (the Company) filed for protection from its creditors under the CCAA in 2015.At the time of filing, the Company sponsored two on-going defined benefit pension plans (the Plans), both of which were registered in NL, and both included employees located in NL, Quebec, and federally regulated employees.Following the filing, the Company stopped paying special payments to the Plans, and the Plans were terminated with combined deficits of nearly million, and special payment arrears of nearly million. The Company held a sales process and liquidated its assets.