In Back to Methuselah, George Bernard Shaw famously
wrote that an election was "as bad as a battle except for the
blood". That is perhaps dramatic in the context of the
Companies' Creditors Arrangement Act
("CCAA"), but certainly a creditor vote
can be a tense and contested affair. Such was the case when
Callidus Capital Corp ("Callidus"), an
asset-based or "distressed lender" and secured creditor,
made a "second kick at the can" to approve a plan of
arrangement already rejected by unsecured creditors, and found
itself barred from voting on the plan for having acted for an
"improper purpose".
The Supreme Court of Canada's decision in 354-9186 Québec inc. v Callidus
Capital Corp confirms that a CCAA supervising judge
has a broad discretion under the express provisions of the CCAA, to
further the remedial objectives of the CCAA. That discretion is
informed by the extensive knowledge of the case gained by the
supervising judge, with the assistance of an independent
