Receiver has discretion to avoid arbitration agreement that preceded insolvency: Ont. CA

By Julius Melnitzer | August 31, 2022

Restructuring lawyer says decision confirms the sanctity of the ‘single proceeding’ model

Ontario Court of Appeal Justice Julie Thorburn has refused leave from an Ontario Superior Court (OSC) ruling that a receiver was not bound by an arbitration agreement that preceded insolvency proceedings.

Kathryn Esaw, a Toronto partner in Osler, Hoskin & Harcourt LLP’s insolvency and restructuring group, lauds the decision.

“Restructuring practitioners see insolvency matters as most effectively resolved in one proceeding, and the decision confirms the sanctity of the ‘single proceeding’ model,” she says. “The result is that there will be less cost in litigating restructuring-related matters, where it’s a good thing to preserve as many of the assets as you can.”