Case Study: Teliphone Corp. v. Ernst & Young
Inc.1
This 2019 decision of the British Columbia Court of Appeal was
the third in a trio of appeals regarding the topic of disengaging
assets owned by insolvent entities subject to a Companies'
Creditors Arrangement Act ("CCAA") proceeding from assets
owned by other affiliated entities that were not insolvent. It
serves as a thorough example of detailing standards of review upon
appeal, and the relatively high bar the courts have for reasons
presented by a court-appointed Monitor to be deemed inadequate upon
appellate review.
Facts
Ernst and Young served as the court-appointed Monitor of the
petitioners. They pursued two parallel goals; to restructure all
related entities and to solicit offers to purchase the assets of
the petitioners. Teliphone Corp., along with several other
appellants, were a group of solvent affiliated entities to the
petitioners that claimed they were not subject to the proceedings
and thus
