Creditor Classification

Summary

This practice note looks at the provisions in the Companies’ Creditors Arrangement Act which permit the division of creditors into different classes for the purposes of voting on a debtor’s plan of compromise and arrangement. It reviews the statutory guidelines and common law principles for determining whether creditors have a commonality of interests, discusses when a classification scheme employed is improper, and identifies process for objecting to a classification scheme — Robin Schwill, Davies Ward Phillips and Vineberg LLP and Dina Milivojevic, Pallett Valo LLP.