On February 1, the Supreme Court of Canada (the "SCC")
released its long-awaited decision in Sun Indalex Finance, LLC
v. United Steel Workers. By a five to two majority, the SCC
allowed the appeal from the 2011 decision of the Ontario Court of
Appeal (the "OCA") which had created so much uncertainty
about the priority of pension claims in Companies'
Creditors Arrangement Act (the "CCAA")
proceedings.
The SCC majority held that the deemed trust for pension claims
created by subsection 57(4) of the Pension Benefits Act
(Ontario) (the "PBA") extends only to amounts
owing under pension plans whose wind-up had already commenced but,
in such circumstances, extends to all amounts that are determined
to be owing by the employer up to the date of wind-up (even if not
determined until a later date), and not just those amounts that
could be determined on the date of wind-up. For pension plans in
wind-up, the scope of the PBA deemed trust is therefore
now wider than previously
