Companies’ Creditors Arrangement Act (R.S.C., 1985, c. C-36)

Act current to 2016-11-21 and last amended on 2015-02-26. Previous Versions

Marginal note:Court may give directions

 Where an alteration or a modification of any compromise or arrangement is proposed at any time after the court has directed a meeting or meetings to be summoned, the meeting or meetings may be adjourned on such term as to notice and otherwise as the court may direct, and those directions may be given after as well as before adjournment of any meeting or meetings, and the court may in its discretion direct that it is not necessary to adjourn any meeting or to convene any further meeting of any class of creditors or shareholders that in the opinion of the court is not adversely affected by the alteration or modification proposed, and any compromise or arrangement so altered or modified may be sanctioned by the court and have effect under section 6.

  • R.S., c. C-25, s. 7.
Marginal note:Scope of Act

 This Act extends and does not limit the provisions of any instrument now or hereafter existing that governs the rights of creditors or any class of them and has full force and effect notwithstanding anything to the contrary contained in that instrument.

  • R.S., c. C-25, s. 8.

PART IIJurisdiction of Courts

Marginal note:Jurisdiction of court to receive applications
  •  (1) Any application under this Act may be made to the court that has jurisdiction in the province within which the head office or chief place of business of the company in Canada is situated, or, if the company has no place of business in Canada, in any province within which any assets of the company are situated.

  • Marginal note:Single judge may exercise powers, subject to appeal

    (2) The powers conferred by this Act on a court may, subject to appeal as provided for in this Act, be exercised by a single judge thereof, and those powers may be exercised in chambers during term or in vacation.

  • R.S., c. C-25, s. 9.
Marginal note:Form of applications
  •  (1) Applications under this Act shall be made by petition or by way of originating summons or notice of motion in accordance with the practice of the court in which the application is made.

  • Marginal note:Documents that must accompany initial application

    (2) An initial application must be accompanied by

    • (a) a statement indicating, on a weekly basis, the projected cash flow of the debtor company;

    • (b) a report containing the prescribed representations of the debtor company regarding the preparation of the cash-flow statement; and

    • (c) copies of all financial statements, audited or unaudited, prepared during the year before the application or, if no such statements were prepared in that year, a copy of the most recent such statement.

  • Marginal note:Publication ban

    (3) The court may make an order prohibiting the release to the public of any cash-flow statement, or any part of a cash-flow statement, if it is satisfied that the release would unduly prejudice the debtor company and the making of the order would not unduly prejudice the company’s creditors, but the court may, in the order, direct that the cash-flow statement or any part of it be made available to any person specified in the order on any terms or conditions that the court considers appropriate.

  • R.S., 1985, c. C-36, s. 10;
  • 2005, c. 47, s. 127.
Marginal note:General power of court

 Despite anything in the Bankruptcy and Insolvency Act or the Winding-up and Restructuring Act, if an application is made under this Act in respect of a debtor company, the court, on the application of any person interested in the matter, may, subject to the restrictions set out in this Act, on notice to any other person or without notice as it may see fit, make any order that it considers appropriate in the circumstances.

  • R.S., 1985, c. C-36, s. 11;
  • 1992, c. 27, s. 90;
  • 1996, c. 6, s. 167;
  • 1997, c. 12, s. 124;
  • 2005, c. 47, s. 128.
Marginal note:Rights of suppliers

 No order made under section 11 or 11.02 has the effect of

  • (a) prohibiting a person from requiring immediate payment for goods, services, use of leased or licensed property or other valuable consideration provided after the order is made; or

  • (b) requiring the further advance of money or credit.

  • 2005, c. 47, s. 128.
Marginal note:Stays, etc. — initial application
  •  (1) A court may, on an initial application in respect of a debtor company, make an order on any terms that it may impose, effective for the period that the court considers necessary, which period may not be more than 30 days,

    • (a) staying, until otherwise ordered by the court, all proceedings taken or that might be taken in respect of the company under the Bankruptcy and Insolvency Act or the Winding-up and Restructuring Act;

    • (b) restraining, until otherwise ordered by the court, further proceedings in any action, suit or proceeding against the company; and

    • (c) prohibiting, until otherwise ordered by the court, the commencement of any action, suit or proceeding against the company.

  • Marginal note:Stays, etc. — other than initial application

    (2) A court may, on an application in respect of a debtor company other than an initial application, make an order, on any terms that it may impose,

    • (a) staying, until otherwise ordered by the court, for any period that the court considers necessary, all proceedings taken or that might be taken in respect of the company under an Act referred to in paragraph (1)(a);

    • (b) restraining, until otherwise ordered by the court, further proceedings in any action, suit or proceeding against the company; and

    • (c) prohibiting, until otherwise ordered by the court, the commencement of any action, suit or proceeding against the company.

  • Marginal note:Burden of proof on application

    (3) The court shall not make the order unless

    • (a) the applicant satisfies the court that circumstances exist that make the order appropriate; and

    • (b) in the case of an order under subsection (2), the applicant also satisfies the court that the applicant has acted, and is acting, in good faith and with due diligence.

  • Marginal note:Restriction

    (4) Orders doing anything referred to in subsection (1) or (2) may only be made under this section.

  • 2005, c. 47, s. 128, 2007, c. 36, s. 62(F).
Marginal note:Stays — directors
  •  (1) An order made under section 11.02 may provide that no person may commence or continue any action against a director of the company on any claim against directors that arose before the commencement of proceedings under this Act and that relates to obligations of the company if directors are under any law liable in their capacity as directors for the payment of those obligations, until a compromise or an arrangement in respect of the company, if one is filed, is sanctioned by the court or is refused by the creditors or the court.

  • Marginal note:Exception

    (2) Subsection (1) does not apply in respect of an action against a director on a guarantee given by the director relating to the company’s obligations or an action seeking injunctive relief against a director in relation to the company.

  • Marginal note:Persons deemed to be directors

    (3) If all of the directors have resigned or have been removed by the shareholders without replacement, any person who manages or supervises the management of the business and affairs of the company is deemed to be a director for the purposes of this section.

  • 2005, c. 47, s. 128.
Marginal note:Persons obligated under letter of credit or guarantee

 No order made under section 11.02 has affect on any action, suit or proceeding against a person, other than the company in respect of whom the order is made, who is obligated under a letter of credit or guarantee in relation to the company.

  • 2005, c. 47, s. 128.

 [Repealed, 2007, c. 29, s. 105]

Marginal note:Member of the Canadian Payments Association

 No order may be made under this Act that has the effect of preventing a member of the Canadian Payments Association from ceasing to act as a clearing agent or group clearer for a company in accordance with the Canadian Payments Act or the by-laws or rules of that Association.

  • 2005, c. 47, s. 128, 2007, c. 36, s. 64.

 [Repealed, 2012, c. 31, s. 420]

Marginal note:Restriction — certain powers, duties and functions

 No order may be made under section 11.02 that affects

  • 2005, c. 47, s. 128.
 
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