Appeal period in Bankruptcy and Insolvency General Rules governed appeal

Bankruptcy and insolvency - Practice and procedure in courts - Appeals

At request of insolvent company's lender (Third Eye), court-appointed receiver over assets, undertaking and property, including mining claims. Certain claims were subject to Gross Overriding Royalty (GOR) in favour of company from which appellant 235 had acquired royalty rights. Notices of agreements granting GORs were registered on title to surface and mining rights. Order approving bid process for sale of insolvent's mining claims generated two bids, both with condition that GORs be terminated or reduced. Motion judge approved sale to successful bidder Third Eye and granted vesting order purporting to extinguish GORs. Motion judge rejected 235's argument that claims would continue to be subject to GORs after their transfer to Third Eye holding that GORs did not run with land or grant holder of GORs interest in lands over which insolvent held mineral rights. Motion judge also held that ss. 11(2), 100, and 101 of the Courts of Justice Act gave him “the jurisdiction to grant a vesting order of the assets to be sold to Third Eye on such terms as are just”, including authority to dispense with royalty rights. Expert's valuation of royalty rights was found to be fair and receiver paid this amount to 235, which were held in trust. 235 appealed and Third Eye brought moved for order quashing 235's appeal as moot since 235 did not seek stay of vesting order which operated to extinguish GORs when it was registered on title, but it was premature to quash appeal. 235 served and filed notice of appeal of sale approval 29 days after motion judge’s decision and 8 days after order was signed, issued and entered. Appeal dismissed. Appeal period in Bankruptcy and Insolvency General Rules (BIA) governed appeal. Under R. 31 of BIA, notice of appeal must be filed “within 10 days after the day of the order or decision appealed from, or within such further time as a judge of the court of appeal stipulates.”. 235 had known for considerable time, there could be no sale to Third Eye in absence of extinguishment of GORs and royalty rights; this was condition of sale that was approved by motion judge. 235 was stated to be unopposed to sale but opposed sale condition requiring extinguishment. Jurisdiction to grant approval of sale emanated from BIA and so did vesting component It would have made little sense to split two elements of order in the circumstance. Essence of order was anchored in BIA. Accordingly, appeal period was 10 days as prescribed by R. 31 of BIA and ran from date of motion judge’s decision and 235’s appeal was out of time.

Third Eye Capital Corporation v. Ressources Dianor Inc./Dianor Resources Inc. (2019), 2019 CarswellOnt 9683, 2019 ONCA 508, S.E. Pepall J.A., P. Lauwers J.A., and Grant Huscroft J.A. (Ont. C.A.); affirmed (2016), 2016 CarswellOnt 15947, 2016 ONSC 6086, Newbould J. (Ont. S.C.J. [Commercial List]).

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