Borden Ladner Gervais LLP (BLG) is proud to share news
of some of its recent litigation successes on Bank of America's
In March 2011, BLG's Montréal office successfully
defended an appeal from the dismissal of a $5,000,000 claim against
Bank of America.
The claim sought damages resulting from the alleged transmission
of a collective agreement pursuant to the purchase of a hotel in
bankruptcy from the trustee in bankruptcy. Bank of America was the
first secured lender.
Under Québec law at the time of the transaction, a
collective agreement did not transfer to the purchaser of an
enterprise sold in the course of a bankruptcy. However, the
affected union contested the transaction and the labour courts
ruled that the sale by the trustee to the plaintiff was a
"simulation" (meaning that it was artificial) and that
despite appearances, the real seller was the secured lender (Bank
of America) and not the trustee in bankruptcy. Therefore, the
plaintiff could not evade the transfer of obligations under the
When the plaintiff turned around and commenced an action against
Bank of America to recover its losses, BLG obtained a dismissal of
the action on grounds which included that the plaintiff's
president was the mastermind behind the transaction, and the
transfer of the collective agreement was a business risk that he
knowingly undertook. That decision was confirmed on appeal.
In February 2011, BLG's Toronto office negotiated
a settlement of two actions commenced against debtors of Bank of
America for cash consideration and the debtors' interests in
two mining companies. The settlement was achieved following a
compressed period of investigation and litigation after BLG's
retainer the previous year. During that timeframe:
BLG commenced a collection action against the debtors as well
as a secondary action to reverse the transfer of an interest in
certain of the debtors' property;
BLG obtained summary judgment in the collection action. In
order to do so, BLG had to successfully convince the court that
Michigan State's six-year limitation period applied to the
action, rather than the expired Ontario limitation period;
BLG successfully defended the debtors' appeal, which turned
on an interpretation of Ontario's Limitations Act, 2002, and
common law conflict of laws principles; and
Armed with the Ontario Court of Appeal's judgment, BLG
negotiated a global settlement which obtained for Bank of America
the bulk of the debtors' assets.
With one of Canada's largest litigation teams, BLG is well
placed to continue providing Bank of America with successful
litigation strategies from its offices in each of Canada's five
major business centers. Among major Canadian firms, BLG has
unparalleled depth of expertise in banking litigation, including
Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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