Companies’ Creditors Arrangement Act

Marginal note:Powers of court

• 11 (1) Notwithstanding anything in the Bankruptcy and Insolvency Act or the Winding-up Act, where an application is made under this Act in respect of a company, the court, on the application of any person interested in the matter, may, subject to this Act, on notice to any other person or without notice as it may see fit, make an order under this section.

• Marginal note:Initial application

  (2) An application made for the first time under this section in respect of a company, in this section referred to as an "initial application", shall be accompanied by a statement indicating the projected cash flow of the company and copies of all financial statements, audited or unaudited, prepared during the year prior to the application, or where no such statements were prepared in the prior year, a copy of the most recent such statement.

• Marginal note:Initial application court orders

  (3) A court may, on an initial application in respect of a company, make an order on such terms as it may impose, effective for such period as the court deems necessary not exceeding thirty days,

  • (a) staying, until otherwise ordered by the court, all proceedings taken or that might be taken in respect of the company under an Act referred to in subsection (1);

  • (b) restraining, until otherwise ordered by the court, further proceedings in any action, suit or proceeding against the company; and

  • (c) prohibiting, until otherwise ordered by the court, the commencement of or proceeding with any other action, suit or proceeding against the company.

• Marginal note:Other than initial application court orders

  (4) A court may, on an application in respect of a company other than an initial application, make an order on such terms as it may impose,

  • (a) staying, until otherwise ordered by the court, for such period as the court deems necessary, all proceedings taken or that might be taken in respect of the company under an Act referred to in subsection (1);

  • (b) restraining, until otherwise ordered by the court, further proceedings in any action, suit or proceeding against the company; and

  • (c) prohibiting, until otherwise ordered by the court, the commencement of or proceeding with any other action, suit or proceeding against the company.

• Marginal note:Notice of orders

  (5) Except as otherwise ordered by the court, the monitor appointed under section 11.7 shall send a copy of any order made under subsection (3), within ten days after the order is made, to every known creditor who has a claim against the company of more than two hundred and fifty dollars.

• Marginal note:Burden of proof on application

  (6) The court shall not make an order under subsection (3) or (4) unless

  • (a) the applicant satisfies the court that circumstances exist that make such an order appropriate; and

  • (b) in the case of an order under subsection (4), the applicant also satisfies the court that the applicant has acted, and is acting, in good faith and with due diligence.