Legal news and trends for Canadian in-house counsel and c-suite executives
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By Paul D. Guy, associate, WeirFoulds LLP Corporate insolvencies The current economic environment has created a number of business casualties. Corporate insolvencies often require in-house counsel to confront a variety of complex and frequently real-time legal issues. Take the following quiz by Paul D. Guy, an associate with WeirFoulds LLP, whose practice includes bankruptcy and insolvency litigation. INHOUSE JUNE 2009 • 11 T T (d) (c) all statutes of (b) tax insolvent (a) 4 statutes for the that the r above. statutes pr pr otect that The False? following otection e equir T Bank Equity next bankruptcy has or . a that Big Private it obtain rue through security is , change company: are sources employees; ofce the sour or to the Big of creditor to its Bank). Bank the company's is The Big would months. Big to prepared of put six company the 3 2 rue loan, Big , short-term bondholders Y False?ou are Bank, cash assets the a (which heart, advance it of of potential envir deductions onment; or ficers interests of holds crunch at in-house ahead the has company required has are of asked beneficiary Bank Big personal such as will Bank. The False? nature of the rue As employees million. all 1 shifts the employees vacation of or a operation, result, the of company's demand the of currently the counsel end is company's the when Big general The Bank a month. to stands and a loan at not that have is but further $15 that This refused. funds, liability GST ; A a no not only option but for directors second it than million. the lend less agreement As payments first-ranking $15 make is facing possible to of if , it declare an lender million $3 and, to is million able unless Distressed to owed get all going at assets fiduciary without any company creditors corporation. be duty to security company's worth able to The paramount. , company approaches by owed now a be A company or declares is paying will $3 bankruptcy million. Secured or any recover severance nothing. wages and corporation's insolvency that creditors earned . terminates pay were the The are total owed requiring and that directors a for security owed covers secured serious employment liquidation last its the of during more all than the value $4 of month