ABLawg - - Page 178

Independent Operations, Holdings and Common Ownership: A Letter Decision of the Alberta Energy Regulator

Last week, ABlawg announced a new three-step project which will present the Alberta Energy Regulator’s (AER’s) published procedural and participatory letter decisions in a more usable and accessible form. As noted in that post, step one of the project, which collates the summaries of these decisions in a searchable PDF document, is now complete.

The objective of this post is to provide an example of the potentially valuable nuggets of information discoverable in this large group of decisions. The post concerns a letter decision which, while ostensibly dealing with procedural matters, also contains discussions of holdings, common ownership and independent operations within the meaning of the 1990 CAPL Operating Procedure. As such, the decision confirms the importance of publishing these decisions insofar as joint operating agreements (JOAs) are common in the industry as is the practice “going penalty”. But the decision also illustrates some confusion between the threshold question of standing and the decision on the merits. In this case it appears to us that the AER panel actually decided the merits of Westbrick’s application and then somewhat perversely denied it standing.

Mennillo v Intramodal inc.: The Supreme Court of Canada Revisits the Oppression Remedy

By Jassmine Girgis

On February 17, 2017

In Corporate / Commercial, Supreme Court of Canada

By: Jassmine Girgis

PDF Version: Mennillo v Intramodal inc.: The Supreme Court of Canada Revisits the Oppression Remedy

Case Commented On: Mennillo v Intramodal inc., 2016 SCC 51 (CanLII)

Mennillo v Intramodal inc. is the first oppression remedy case since BCE Inc. v 1976 Debentureholders 2008 SCC 69 (CanLII) (BCE) to reach the Supreme Court of Canada. The SCC had to determine whether the failure of a company to observe formalities required under the Canada Business Corporations Act, RSC 1985, c C-44 (CBCA) constituted oppression as against a former shareholder. The appeal of the former shareholder was dismissed on a finding that neither “sloppy paperwork on its own” nor “the corporation and its controlling shareholder treating [the former shareholder] exactly as he wanted to be treated” (at para 5) constituted oppression. There was a majority opinion (written by Cromwell J), a concurring opinion (McLachlin CJ and Moldaver J), and a strong dissent by Justice Côté.

This post deals with the comments made by the Court, including the dissent, on the oppression remedy. The oppression remedy is available when the court is satisfied that the corporation or its directors acted in a way that is oppressive or unfairly prejudicial to, or that unfairly disregards the interests of, any security holder, creditor, director, or officer (CBCA, s 241(2)).

Residential Tenancy Agreements, Options to Purchase, In Terrorem Clauses, and Relief from Forfeiture

By Jonnette Watson Hamilton

On February 16, 2017

In Contracts, Property, Provincial Court

By: Jonnette Watson Hamilton

PDF Version: Residential Tenancy Agreements, Options to Purchase, In Terrorem Clauses, and Relief from Forfeiture

Case Commented On: Dreamworks Ventures Ltd v Dye, 2017 ABPC 20 (CanLII)

This residential tenancy case, arising in the context of a rent-to-own arrangement, is light on the law. The dispute was primarily about the tenants’ responsibility for cleaning and painting after they left the house and this decision assesses the damages. Nevertheless, the case raised one interesting legal point. Judge Allan H. Lefever mentioned an in terrorem clause in connection with the Option to Purchase that had been granted to the tenants in return for a non-refundable $5,000 deposit that was part of the rent-to-own arrangements. While he mentions the clause, he did not discuss it because it was not relevant to the dispute. The in terrorem clause tried to scare the tenants to stop them from filing a caveat to protect their interest under the Option to Purchase. Can this in terrorem clause possibly be valid? This, it seems, is a difficult question to answer.

The Relationship Between Declarations Under the Optional Clause of the Statute of the International Court of Justice and Part XV of the Law of the Sea Convention

By Nigel Bankes

On February 13, 2017

In International Law, Law of the Sea

By: Nigel Bankes

PDF Version: The Relationship Between Declarations Under the Optional Clause of the Statute of the International Court of Justice and Part XV of the Law of the Sea Convention

Case Commented On: Maritime Delimitation in the Indian Ocean (Somalia v Kenya), Preliminary Objections, Judgment, 2 February 2017

Somalia instituted proceedings against Kenya in the International Court of Justice (ICJ or the Court) in August 2014 concerning a dispute in relation to “the establishment of the single maritime boundary between Somalia and Kenya in the Indian Ocean delimiting the territorial sea, exclusive economic zone . . . and continental shelf, including the continental shelf beyond 200 nautical miles” (Somalia’s Application). In so doing Somalia relied upon Optional Declarations made by both states pursuant to Article 36(2) of the Statute of the Court. Kenya raised a preliminary objection as to the jurisdiction of the Court and also argued that the Court should treat Somalia’s application as inadmissible. On 2 February 2017, the Court released its judgment in respect of these preliminary objections.

This post explains the basis of Kenya’s arguments in respect of the jurisdiction of the Court and the admissibility of Somalia’s claim. It reviews the Court’s Judgment and dissenting opinions and declarations and offers some concluding remarks focussing on the relationship between declarations under the optional clause of the Statute of the International Court of Justice and Part XV of the Law of the Sea Convention (LOSC).

Canadian Mining Operators Abroad – Corruption as a ‘Real Risk’ Factor in Forum Non Conveniens Applications

By Rudiger Tscherning

On February 9, 2017

In Conflict of Laws, Torts

By: Rudiger Tscherning

PDF Version: Canadian Mining Operators Abroad – Corruption as a ‘Real Risk’ Factor in Forum Non Conveniens Applications

Case Comment On: Garcia v Tahoe Resources Inc., 2017 BCCA 39 (CanLII)

In Garcia v Tahoe Resources Inc., 2017 BCCA 39 (CanLII) the Court of Appeal of British Columbia reversed an order which had granted Tahoe Resources Inc. (Tahoe) a stay of proceedings on grounds of forum non conveniens. The claim brought against Tahoe concerned the shooting of local protesters by security guards at Tahoe’s Guatemalan mining operation. The Court of Appeal held that the possibility of corruption in the Guatemalan legal system raised a real risk that the claimants would not obtain a fair trial, and therefore concluded that British Columbia was the “more appropriate forum”.

The decision raises a number of important issues, particularly for the Canadian energy and natural resources sector. The decision has the potential to undermine the attractiveness of Canadian jurisdictions as preferred venues for the registration of mining companies that engage in international activities. Tahoe’s registered office is in Vancouver which gave rise to jurisdiction simpliciter. The decision is also noteworthy from a private international law perspective. Firstly, the effect of the judgment is that serious doubt has been cast over the reliability of the legal system of an entire country, thereby raising issues of comity upon which the functioning of private international law depends. Secondly, the case marks the acceptance of the English test of ‘real risk’ of judicial unfairness as a factor in Canadian forum non conveniens analysis. Lastly, the BCCA focused on the close alignment between international resources companies and their host state governments and considered that the context of extensive local opposition to a mining project was a factor that pointed to British Columbia as the more appropriate forum.