Beware the bankruptcy appeal period

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Parties and counsel are often caught out by the short appeal period that applies to appeals brought pursuant to the Bankruptcy and Insolvency Act, RSC 1985, C B-3 (the “BIA”).

In most litigation, an appeal must be commenced within a 30-day period that begins the day after the order appealed from is pronounced. In appeals brought pursuant to the BIA,however, an appeal to the Court of Appeal must be commenced within 10 days after the day the order appealed from is pronounced.

While the application of this shorter appeal period is sometimes clear, such as in appeals from orders pronounced within a bankruptcy proceeding, a further potential pitfall exists in cases in which it is not obvious that this shorter appeal period applies. In one relatively recent example, Forjay Management Ltd v 625536 BC Ltd 2019 BCCA 368, an appeal from an order pronounced in a foreclosure proceeding, was found to be subject to the 10-day appeal period.

In Forjay, the appellant brought an appeal from an order authorizing a receiver to pay proceeds of sale to certain mortgagees. The court rejected the appellant’s argument that the 30-day period should apply because it had simply sought conditions for the order pursuant to the Supreme Court Civil Rules and the court’s inherent jurisdiction. The court noted that the original order appointing the receiver was made pursuant to the BIA and the Law and Equity Act, RSBC 1996, c 253 and on this basis, the appeal was governed by the BIA on the basis of paramountcy. Moreover, as the power to authorize a receiver to distribute proceeds to creditors is “implicit” in the BIA, and as the distribution order was an order contemplated by the order appointing the receiver, the distribution order had been made by a court deriving its original jurisdiction from the BIA, such that the 10-day period applied. As the appeal was brought 24 days after the order pronounced, and no extension was granted, the appeal was dismissed. 

Forjay is just one example of the peril that can await an appellant when the application of the shorter appeal period is not readily apparent. Experienced advice is critical for parties contemplating – or responding to – an appeal in an insolvency context.

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