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w w w . C A N A D I A N L a w y e r m a g . c o m A p r I L 2 0 1 5 23 initial and subsequent agreements. While the landlords will have wanted to protect themselves as best they could, much lies in their negotiating power and the degree of the landlord's desire to nail down that anchor tenant. And while the lease can contain all kinds of provisions in respect to insolvency, both the CCAA and the Bankruptcy and Insolvency Act can over- ride those provisions. Target, like many other large busi- nesses in Canada, chose to go the CCAA route instead of filing for bankruptcy. "This CCAA can, in fact, function like a poison pill," says Daoust. He has seen a resurgence in the number of businesses preferring to restructure under the CCAA over the past decade and a half. "It's almost as though what happened was a retail chain that was in trouble stumbled across the legislation," he adds. Although it originally grew out of the depression in 1933, CCAA saw something of a resurgence in the 1990s, observes insolvency lawyer David Ullman, a part- ner with Minden Gross LLP. Boutique Jacob, Mexx, Bowring, and XS Cargo all used the CCAA in connection with their recent insolvency proceedings. The statute allows for creative approaches to problems that the more rigid bankruptcy regimen does not. But what has been more controversial, he points out, has been the recent trend towards using the CCAA in pure liqui- dation proceedings. The CCAA doesn't have the same codified procedures and timelines required by the Bankruptcy and Insolvency Act and the relevant provi- sions of provincial commercial leasing statutes, giving greater flexibility which are seen as beneficial to the tenant and a detriment of the landlord. The negotiations between the land- lords and Target Canada concluded with a consent order, setting out an agreement on the sale of the leases under the super- vision of a court-appointed monitor. At issue was whether Target should be forced into bankruptcy instead of proceeding by way of CCAA because it was not seek- ing restructuring in the traditional sense, but rather pursuing pure liquidation. The parties ultimately settled on a deal which addressed both the concerns of the landlords that delays could leave unoccu- pied properties in limbo as well as Target Corp.'s goal of getting out of Canada on a schedule which it hopes will maximize recovery. "One of the key takeaways for landlords from this process in Target is to remember that they don't always have to accept what the tenant in CCAA pro- tection is offering them. Landlords can flex their collective might to have a more fair process put in place, over the tenant's objections," says Ullmann. June 30 was set as the final deadline for the retailer's sale of the leases. The rights for any leases not sold by then are returned to the landlords. As Target works toward its spring goals, eyes will be upon the assign- ment of the leases. Ullmann suggests the use clause in the leases could well play into what happens next. If the terms of the clause are too general, it will be easy for the tenant or trustee in bankruptcy to assign the lease to a new tenant. If it is too restric- tive a court may strike it. Landlords don't want to see either scenario. The key, says Ullmann, is balance. Because business issues are legal issues. So if you want to get ahead in business, get the degree that gets you there faster. ONE YEAR – PART - TIME – NO THESIS FOR L AWYERS AND NON - LAWYERS law.utoronto.ca/ExecutiveLLM GPLLM Global Professional Master of Laws [Get a Master of Laws] ntitled-1 1 2015-02-25 8:38 AM

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