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ARTICLE · 04 NOVEMBER 2020

Court Of Appeal Summaries (October 26 – October 30, 2020)

Blaney McMurtry LLP
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Instead, it was enacted so that if a municipality found value in arguing receipt, it could rely on the evidentiary shortcut that s. 381(2) provides

CanadaLitigation, Mediation & Arbitration
John Polyzogopoulos
John Polyzogopoulos
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Please find below our summaries of the civil decisions of the Court of Appeal for the week of October 26, 2020.

The headline decision is 7636156 Canada Inc. (Re). In a 54-page decision, the Court of Appeal canvassed in detail the law relating to letters of credit and the "autonomy" principle, and whether obligations by banks under LC's are affected by a bankruptcy of the underlying debtor. In this case, the underlying debtor that went bankrupt was a commercial tenant. The application judge held that the landlord was only entitled to draw on the LC for its preferred claim of three months' rent after the tenant's trustee in bankruptcy disclaimed the lease. The Court of Appeal disagreed, confirming that under the autonomy principle, the obligation under the LC was independent of the tenant (and trustee's) obligations under the lease, and as between only the landlord and the bank. In coming to its conclusion, the Court had to choose between conflicting lines of

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