



COURT OF APPEAL FOR ONTARIO

CITATION:
Timminco
    Limited (Re), 2012 ONCA 552

DATE: 20120720

DOCKET: M41062 & M41085

Simmons, Juriansz and Epstein JJ.A.

In the Matter of the
Companies Creditors
    Arrangement Act
, R.S.C. 1985, c. C-36, as Amended

And in the Matter of a Proposed Plan of
    Compromise or Arrangement with Respect to Timminco Limited and Becancour
    Silicon Inc.

Applicants

Ashley J. Taylor and Erica
    Tait, for the applicants

Douglas J. Wray and Jesse
    Kugler, for the Communications, Energy and Paperworkers Union of Canada

Charles E. Sinclair, for the
    United Steelworkers

Considered in writing on: July 20, 2012

On leave to appeal from the order of Justice Geoffrey B.
    Morawetz of the Superior Court of Justice, dated February 9, 2012.

ENDORSEMENT

[1]

Leave to appeal is denied.

[2]

In the CCAA context, leave to appeal is to be granted sparingly and only
    where there are serious and arguable grounds that are of real and significant
    interest to the parties. In determining whether leave ought to be granted, this
    Court is required to consider the following four-part inquiry:

·

whether the point on the proposed appeal is of significance to
    the practice;

·

whether the point is of significance to the action;

·

whether the proposed appeal is
prima facie
meritorious
    or frivolous; and

·

whether the appeal will unduly hinder the progress of the action.

See
Re Stelco
(2005), 78 O.R. (3d) 241

[3]

In our view, the proposed appeals lack sufficient merit to meet this
    stringent test.

[4]

This courts decision in
Indalex Ltd. (Re)
(2011), 104 O.R. (3d) 641,

affirms
    that a CCAA court may invoke the doctrine of paramountcy to override
    conflicting provisions of provincial statutes where the application of
    provincial legislation would frustrate the companys ability to restructure and
    avoid bankruptcy.

[5]

Here, the motion judge recognized that in the circumstances of this case
    there was a conflict between the federal CCAA and the provincial PBA and SPPA.
    He found that, [i]n the absence of the court granting the requested super
    priority, the objectives of the CCAA would be frustrated.  Further, he
    concluded that to ensure that the objectives of the CCAA are fulfilled, it is
    necessary to invoke the doctrine of paramountcy such that the provisions of the
    CCAA override those of the QSPPA and the OPBA.

[6]

We see no basis on which this court could interfere with the motion
    judges decision, including his unassailable findings of fact that: (1) without
    DIP financing, Timminco would be forced to cease operating; (2) bankruptcy
    would not be in the interests of anyone, including members of the pension plan;
    (3) if the DIP lender did not get super priority, it would not have agreed to
    provide financing; and (4) there was insufficient liquidity or unfavourable
    terms associated with the rejected DIP proposals. In short, he found that there
    was no real alternative to approving the DIP facility and DIP super priority
    charge.

[7]

The motion judge also addressed the unions fiduciary arguments,
    primarily in his earlier reasons released February 2, 2012, that are incorporated
    by reference into his February 9, 2012 reasons. He concluded that it was in the
    best interests of all parties to proceed with the restructuring. We see no basis
    on which this court could interfere with this finding.

[8]

Costs are to the responding parties on the motions on a partial
    indemnity scale fixed in the amount of $1,500 per motion inclusive of
    disbursements and applicable taxes.

Janet Simmons
    J.A.

R.G. Juriansz
    J.A.

G.J. Epstein J.A.


