Alderbridge Way GP Ltd. (Re), 2022 BCSC 1694  
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IN THE SUPREME COURT OF BRITISH COLUMBIA  
Citation: Alderbridge Way GP Ltd. (Re),  
2
022 BCSC 1694  
Date: 20220928  
Docket: S222758  
Registry: Vancouver  
In the Matter of the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36,  
as amended  
-
and -  
In the Matter of a Plan of Compromise and Arrangement of 0989705 B.C. Ltd.,  
Alderbridge Way GP Ltd. and Alderbridge Way Limited Partnership  
Before: The Honourable Justice Fitzpatrick  
Reasons for Judgment  
In Chambers  
Counsel for the Petitioners 0989704 B.C. Ltd., Alderbridge Way GP  
Ltd., and Alderbridge Way Limited Partnership:  
J.R. Sandrelli  
V.L. Cross  
P.L. Rubin  
M. Gill  
Counsel for Romspen Investment Corp.:  
Counsel for Bowra Group Inc.:  
Counsel for CIBT Education Group Inc., GEC Education City  
S.Y. Bhura  
(
Richmond), GEC (Richmond) GP Inc.:  
Counsel for JV Driver Investments Inc.:  
Place and Date of Hearing:  
A. Williams  
Vancouver, B.C.  
August 11 and 19,  
2
022  
Place and Date of Judgment:  
Vancouver, B.C.  
September 28,  
2
022  
INTRODUCTION  
[
1]  
The petitioners (collectively, “Alderbridge”) apply for an order increasing the  
Administration Charge from $300,000 to $655,000, which is focussed on securing payment  
of Alderbridge’s outstanding counsel’s fees. In addition, Alderbridge applies for an order  
allocating the Administration Charge, as increased, as between Alderbridge’s counsel  
(
$455,000) and the Monitor and its counsel ($100,000 each).  
[
2] The application is opposed by two major secured creditors, Romspen Investment  
Corporation (“Romspen”) and CIBT Education Group Inc. and its related entities (collectively,  
CIBT”). Romspen is Alderbridge’s first and largest secured creditor. CIBT is in third position,  
however, it raises certain potential priority issues that may increase its ranking. Romspen and  
CIBT essentially advance the same arguments on this application. I will therefore refer only to  
the arguments as being those of Romspen.  
BACKGROUND FACTS  
[
3]  
The underlying facts that inform this application are complex.  
Historical Facts re Alderbridge  
[
4]  
Alderbridge’s main asset is a very large stalled development project in Richmond, BC.  
[
5]  
In 2018, construction of the development began. In November 2019, Romspen was  
granted a first ranking charge, ranking ahead of the second-tier lenders and CIBT’s third  
ranking security. Further financing to support the Romspen loan was contemplated but never  
materialized.  
[
6]  
After March 2020, Romspen did not make any further advances to Alderbridge. From  
that time forward, Alderbridge made significant efforts to secure new construction financing  
and later, conduct a sales process, all from its own resources. In September 2020,  
construction halted. By January 2022, efforts to refinance or sell the development assets had  
failed.  
[
7]  
Since mid-2020, throughout the course of Alderbridge’s restructuring efforts, it has  
been assisted by its legal counsel, Dentons Canada LLP (“Dentons”).  
The Initial Hearing  
[
9]  
On April 1, 2022, I granted an initial order in favour of Alderbridge pursuant to the  
CCAA (the “Initial Order”). My reasons for doing so are indexed at Alderbridge Way GP Ltd.  
(
Re), 2022 BCSC 1436 [Initial Reasons].  
[
10] At the hearing on April 1, 2022, this Court addressed the usual matters, including  
appointing the Monitor, as proposed by Alderbridge.  
[
11] The Initial Order provided that the Administration Charge was set at $300,000. The  
form of the order in relation to the Charge and the payment of professional fees followed the  
usual wording found in this Court’s CCAA Initial Model Order, as follows:  
3
1.  
The Monitor, counsel to the Monitor, if any, and counsel to the Petitioners shall be paid  
their reasonable fees and disbursements, in each case at their standard rates and charges, by  
the Petitioners as part of the cost of these proceedings. The Petitioners are hereby authorized  
and directed to pay the accounts of the Monitor, counsel to the Monitor and counsel to the  
Petitioners on a periodic basis and, in addition, the Petitioners are hereby authorized to pay to  
the Monitor, counsel to the Monitor, and counsel to the Petitioners, retainers in the amounts  
of $50,000 respectively to be held by them as security for payment of their respective fees and  
disbursements outstanding from time to time.  
3
3. The Monitor, counsel to the Monitor, if any, and counsel to the Petitioners shall be  
entitled to the benefit of and are hereby granted a charge (the "Administration Charge") on the  
Property, which charge shall not exceed an aggregate amount of $300,000 as security for their  
respective fees and disbursements incurred at the standard rates and charges of the Monitor  
and such counsel, both before and after the making of this Order which are related to the  
Petitioners' restructuring. The Administration Charge shall have the priority set out in  
paragraphs 40, 42, and 43 of this Order.  
[
[
Emphasis added.]  
12] I accepted that the amount of the Administration Charge was reasonable (Initial  
Reasons at para. 9), noting that no stakeholder, including Romspen, objected to that amount.  
In addition, the Proposed Monitor stated in its Report dated March 31, 2022 at para. 12.3 that  
this amount was appropriate and reasonable given:  
the scale and complexity of Alderbridge and the CCAA proceedings, the services to be  
provided by the beneficiaries of the Administration Charge and the size of the charges  
approved in similar CCAA proceedings.  
[
[
Emphasis added.]  
13] In the usual fashion, the Initial Order (para. 8(a)) contained a general prohibition that  
Alderbridge was not entitled to pay any pre-filing debts, save as authorized by the Court.  
However, also consistent with the Model Order, the Initial Order provided that Alderbridge  
could pay Dentons’ fees, whether pre- or post-filing, as were “related to the … restructuring”:  
5
.
The Petitioners shall be entitled, but not required, to pay the following expenses which  
may have been incurred prior to the Order Date:  
(
a)  
the fees and disbursements of any Assistants [defined in para. 4 to include counsel]  
retained by the Petitioners which are related to the Petitioners' restructuring, at their standard  
rates and charges, including payment of the fees and disbursements of legal counsel retained  
by the Petitioners, whenever and wherever incurred, in respect of:  
(
i) these proceedings or any other similar proceedings in other jurisdictions in which the  
Petitioners or any subsidiaries or affiliated companies of the Petitioners are domiciled; …  
[
[
Emphasis added.]  
14] At the initial hearing, Alderbridge had exhausted its cash resources and Romspen was  
not prepared to advance any funds. Accordingly, I approved interim financing and a related  
charge of $850,000 (initially estimated at $1 million) in favour of certain corporate entitles  
related to Alderbridge (collectively, “Gatland”) (Initial Reasons at para. 10). The Gatland  
financing was intended to allow Alderbridge to continue until the comeback hearing in late  
April 2022. The Gatland financing and charge was ranked behind the Administration Charge,  
the Directors Charge and Romspen’s security, but ahead of the second-tier lender and CIBT.  
[
15] The First Report of the Proposed Monitor’s cash flow forecast for the period ending  
April 29, 2022 was based on $1 million of financing from Gatland, not $850,000. Note 8 to  
the Monitor’s cash flow forecast to late April 2022 projected payment of $555,000 to Dentons,  
the Monitor and its counsel based on:  
projected costs of professional services firms relating to the CCAA Proceedings and include  
[
Alderbridge’s] counsel as well as the Monitor and its legal counsel. Payments forecast in  
Week 2 and Week 4 of the Cash Flow Forecast represents the payment for retainers and the  
payment of professional fees for services rendered during the lead up to the CCAA  
Proceedings.  
[
Emphasis added.]  
[
(
16] At the initial hearing, the general contractor, Metro-Can Construction (AT) Ltd.  
“Metro-Can”) specifically raised objections with respect to the large receivable owing to  
Dentons and the Monitor’s cash flow: Initial Reasons at para. 20.  
[
17] Dentons acknowledged at the hearing that a projected payment of $555,000 would be  
used to pay the three $50,000 retainers (that were paid and are still held) and to pay the  
Monitor for its costs in advance of the hearing. Counsel advised that the remainder to be  
advanced would be to get Dentons “caught up”, although counsel acknowledged that it would  
not quite “catch them up”. Counsel acknowledged that Alderbridge would have to find further  
financing to advance the CCAA proceedings beyond the comeback hearing.  
[
18] In the Initial Reasons, I addressed these issues and agreed that Alderbridge would be  
given the authority to pay both the post-filing and pre-filing amounts owing and to be owed to  
Dentons. I found that the amounts outstanding to Dentons represented a reasonable amount  
expended by Alderbridge toward seeking a solution to their restructuring difficulties, as  
follows:  
[
12] The significant portion of the interim financing ($555,000) is budgeted in the cash  
flow (to April 29, 2022) for payment of professional fees. As noted in para. 9.4(b) of the  
Proposed Monitor’s report dated March 31, 2022, that amount is intended to include:  
professional fees payable to … counsel to [Alderbridge] … Dentons ... and A&M,  
representing payments for outstanding invoices for the period leading up to the CCAA filing  
and payments for retainers to Dentons, A&M and counsel to the Monitor ….  
[
20] Metro-Can’s counsel also addresses the amount to be spent through the proposed  
interim financing, in particular the large amount to be paid to Dentons. I agree that it is a  
large amount. Mr. Sandrelli has advised that the amount relates to the substantial work that  
Dentons has done for Alderbridge, not just in the immediate lead-up to the CCAA filing, but  
with respect to the undoubted substantial efforts that have been made over at least the last  
two years. I have already outlined what those efforts have been. They include the extensive  
and complex discussions between Alderbridge and other stakeholders and undertaking the  
SISP. They also include all of the myriad of issues that would have arisen in respect of keeping  
Alderbridge afloat, while they kept the CCAA option alive, but also explored other options,  
including leading to the development agreement that came to pass through the SISP, but  
eventually did not complete.  
[
(
21] As Mr. Sandrelli notes, it is anticipated in the Court’s model CCAA initial order  
Practice Direction-47) that reasonable amounts relating to the period before the filing may be  
appropriately paid after the CCAA filing. I am satisfied that that is the situation here with  
respect to the amount to be paid to Dentons.  
[
[
Emphasis added.]  
19] Romspen supported the CCAA filing and the specific relief granted in the Initial Order.  
However, there are nuances to the circumstances that existed at the initial hearing,  
particularly from Romspen’s point of view, that bear upon the current issues.  
[
20] On April 1, 2022, Romspen’s counsel advised the Court that the CCAA filing, as  
supported by Romspen, was the result of a material compromise with Alderbridge that  
resulted from difficult negotiations between the parties and a careful balancing of Romspen’s  
rights as the first ranking secured creditor. The negotiated aspects of the CCAA filing included  
the Monitor having enhanced power to run the sales process (the “SISP”) in order to advance  
the proceedings, all of which were reflected in the Initial Order.  
[
21] Importantly, part of the negotiated agreement was that the Administration Charge  
would be $300,000 and that the financing for the professional costs to be paid after the filing  
would come from Gatland’s interim financing, which was to rank behind Romspen’s security.  
Dentons expressly acknowledged this point in meeting Metro-Can’s objection to these future  
payments to Dentons, when Dentons stated that Romspen would not be prejudiced by any  
such payment since it was being financed under the Gatland charge.  
The ARIO  
[
22] On April 25, 2022, the comeback hearing took place, resulting in the granting of an  
amended and restated initial order (the “ARIO”). The ARIO included: an extension of the stay  
of proceedings to August 3, 2022; approval of the SISP; replacement of the Monitor who  
continued to have the enhanced powers to run the SISP; and, confirmation of the  
Administration Charge at $300,000 (essentially the provisions from the Initial Order, as  
above).  
[
23] Unfortunately, Alderbridge had not been successful in obtaining any further interim  
financing, from Gatland or otherwise. Accordingly, Romspen agreed to advance $1.65 million  
under a further interim financing charge, which was to rank pari passu with the Gatland  
interim financing after Romspen’s main security. As with the Initial Order in relation to the  
Gatland interim financing, the ARIO specifically provided that the Romspen interim financing  
was to “finance the continuation of the Business and preservation of the Property”.  
[
24] At the time of the comeback hearing, professional fees of $402,000 had been paid  
against the forecast of $555,000, although the earlier forecast was based on the Gatland  
interim loan being $1 million, not $850,000.  
[
25] In its Second Report dated April 23, 2022, the Monitor revised the earlier cash flow  
forecast. Then, the Monitor projected, to August 2022, payment of professional fees of  
955,000. As with the earlier cash flow forecast, Note 8 addressed what payments were  
$
intended to be made from that amount:  
Restructuring professional fees have been forecast based on projected costs of professional  
services firms relating to the CCAA Proceedings and include [Alderbridge’s] legal counsel as  
well as the Monitor and its legal counsel, including professional fees for services rendered  
during the lead up to the CCAA Proceedings.  
[
[
Emphasis added.]  
26] Over the ensuing three months, the parties and the Monitor made substantial efforts to  
advance the SISP, including extending the applicable deadlines numerous times. Nevertheless,  
by early August 2022, no compliant bid was received.  
The SARIO  
[
27] The next hearing took place on August 11, 2022 and represented a “sea change” of sorts  
in respect of how this CCAA proceeding would continue.  
[
28] On that date, Romspen applied for various relief, resulting in the granting of a second  
amended and restated initial order (the “SARIO”) on an uncontested basis. The SARIO  
included: an extension of the stay to October 2022; a further expansion of the Monitor’s  
powers to assume control of the development in place of Alderbridge and continue the SISP;  
and, approval of a second interim financing by Romspen of $2.5 million, to rank behind the  
Administration Charge and the Directors Charge and ahead of Romspen’s main security.  
[
29] In the SARIO, the Administration Charge was again confirmed at $300,000 under the  
original provisions in the Initial Order, but with the added proviso that Alderbridge’s counsel  
would only have the benefit of the Administration Charge for its reasonable fees and  
disbursements incurred prior to August 11, 2022, the date that the SARIO was made.  
[
[
30] In advance of the hearing to consider the SARIO, Alderbridge filed this application.  
31] In the Monitor’s Fourth Report dated August 9, 2022, the Monitor reported that to the  
end of July 2022, forecasted professional fees of $1.17 million were actually paid in the  
amount of $1 million, leaving a shortfall of $171,000. By this time, Romspen had not advanced  
all of the amounts initially projected under its first interim financing ($1.65 million) in that  
$
1.377 million had been advanced.  
[
32] The Monitor’s Fourth Report also reported that, of the $562,000 that had been  
forecasted for Dentons from April–July 2022, $427,621 had been paid (including the $50,000  
retainer), leaving a shortfall of $134,379.  
Current Status of Dentons Accounts  
[
33] The relevant figures with respect to Dentons’ accounts, both pre- and post-filing, are as  
follows:  
a)  
b)  
$621,906 for pre-filing fees (August 2021-March 2022); and  
$227,228 for post-filing fees (April 2022-July 2022).  
[
34] Alderbridge and Romspen analyze the amounts outstanding to Dentons in different  
and opposite ways, arising from the manner in which Dentons has allocated the amount paid  
during the CCAA proceedings ($427,621):  
a)  
position that its post-filing accounts (less the retainer) remain unpaid in the amount of  
454,348 (hence the amount of the requested increase in the Administration Charge); and  
Dentons applied all post-filing payments to its earliest accounts, and now takes the  
$
b)  
Romspen states that Dentons has been paid all of its post-filing accounts ($227,228)  
and approximately $200,000 toward its pre-filing fees.  
CCAA AND RELATED JURISPRUDENCE  
[
35] The parties agree that the Court has jurisdiction to grant the relief sought.  
[
36] The Court will typically exercise its general discretion under s. 11 of the CCAA in  
respect of the conduct of the affairs of the debtor, including authorization to make payments  
to certain persons. As is well-known, the broad discretion afforded to the Court is such that  
pre-filing amount may be authorized, as are considered appropriate in the circumstances.  
[
37] Section 11.7(1) of the CCAA mandates that a monitor be appointed to provide oversight  
throughout the proceedings. Therefore, there is considerable focus at the initial hearing on  
who the monitor will be and how it and its counsel will be paid in respect of the cost of their  
services. In addition, the debtor will invariably have and need counsel in the course of the  
proceedings and questions may arise, as they did here, as to how that professional firm will be  
paid. The uncertainty that is inherent in CCAA proceedings will raise issues as to how to  
protect these professionals from any untoward exposure of non-payment.  
[
38] CCAA courts have been attuned to these issues and addressed them on a regular basis  
even before the authority to do so was enshrined in the CCAA.  
[
39] As of 2009, the CCAA provides express authority and discretion to grant a charge in  
favour of professionals to secure their legal fees and disbursements, as is appropriate:  
1
1.52(1) On notice to the secured creditors who are likely to be affected by the security or  
charge, the court may make an order declaring that all or part of the property of a debtor  
company is subject to a security or charge — in an amount that the court considers  
appropriate — in respect of the fees and expenses of  
(
a) the monitor, including the fees and expenses of any … legal or other experts engaged by  
the monitor in the performance of its duties;  
(
b)  
any … legal … experts engaged by the company for the purpose of proceedings under  
this Act; and  
(
2) The court may order that the security or charge rank in priority over the claim of any  
secured creditor of the company.  
[
40] Alderbridge refers to the policy considerations underlying the protections that are  
usually afforded to the professionals in CCAA proceedings, including the granting of a charge.  
[
[
41] In Timminco Limited (Re), 2012 ONSC 506, Justice Morawetz, as he then was, stated:  
66] In my view, in the absence of the court granting the requested super priority and  
protection, the objectives of the CCAA would be frustrated. It is not reasonable to expect that  
professionals will take the risk of not being paid for their services, and that directors and  
officers will remain if placed in a compromised position should the Timminco Entities  
continue CCAA without the requested protection. The outcome of the failure to provide these  
respective groups with the requested protection would, in my view, result in the overwhelming  
likelihood that the CCAA proceedings would come to an abrupt halt, followed, in all likelihood,  
by bankruptcy proceedings.  
[
3
42] Timminco was referred to recently in Canada v. Canada North Group Inc., 2021 SCC  
0 [Canada North Group], where Justice Côtė endorsed the protections that are granted to  
professionals in CCAA proceedings:  
[
30] Super-priority charges in favour of the monitor, financiers and other professionals are  
required to derive the most value for the stakeholders. They are beneficial to all creditors …  
The fact that they require super priority is just a part of “[t]he harsh reality . . . that lending is  
governed by the commercial imperatives of the lenders” (Indalex, at para. 59). It does not  
make commercial sense to act when there is a high level of risk involved. For a monitor and  
financiers to put themselves at risk to restructure and develop assets, only to later discover  
that a deemed trust supersedes all claims, smacks of unfairness. …  
[
31] It is therefore clear that, in general, courts supervising a CCAA reorganization have the  
authority to order super-priority charges to facilitate the restructuring process. …  
[
43] At any initial hearing, the court has a suite of options available to it to ensure payment  
to the professionals for costs in the proceeding, as may be appropriate. The court can order  
that retainers be paid; that ongoing payments be made as invoiced; and/or that a charge be  
granted. All of those protections were employed here, as evidenced by the Initial Order  
(
quoted above) and later, the ARIO and SARIO.  
[
44] A consideration of these protections at the time of the initial hearing is typically  
forward-focussed, as the court must gauge the costs that might be expected in the course of  
the proceedings. Hence, para. 31 of the Initial Order refers to the “cost of these proceedings”  
and para. 33 refers to a charge for costs (both pre and post filing) that are “related to the …  
restructuring”. This latter phrase is intended to allow some flexibility in respect of the  
payment of costs that will invariably arise prior to the filing date but are reasonably connected  
to the restructuring proceedings.  
[
45] The non-exhaustive factors that courts may consider in approving or increasing an  
administrative charge and setting the amount were set out in Canwest Publishing Inc. (Re),  
010 ONSC 222 [Canwest Publishing] at para. 54, as adopted by this Court in Walter Energy  
2
Canada Holdings Inc. (Re), 2016 BCSC 107 at para. 42, and Mountain Equipment Co-  
Operative (Re), 2020 BCSC 2037 at para. 58:  
(
(
(
(
(
(
[
a)  
b)  
c)  
d)  
e)  
f)  
the size and complexity of the businesses being restructured;  
the proposed role of the beneficiaries of the charge;  
whether there is an unwarranted duplication of roles;  
whether the quantum of the proposed charge appears to be fair and reasonable;  
the position of the secured creditors likely to be affected by the charge; and  
the position of the Monitor.  
46] Many of the Canwest Publishing factors are, inherently, forward-looking. These refer  
to the proposed role of the beneficiaries; the role to be undertaken by the professionals; and,  
how secured creditors will likely be affected. As such, these factors are typically considered in  
the early days of the proceedings, when the amount of the Administration Charge is set, either  
at the initial hearing or the comeback hearing. Case authorities cited by Alderbridge are  
representative of this scenario: Canwest Publishing at paras. 52–55; Pacific Shores Resort &  
Spa Ltd. (Re), 2011 BCSC 1775 at paras. 2 and 59; Laurentian University of Sudbury (Re),  
2
021 ONSC 659 at paras. 48-53 (and the later ARIO that was granted in that proceeding at  
Laurentian University of Sudbury, 2021 ONSC 3545 at para. 8).  
[
47] Stakeholders, but particularly secured creditors, who will normally rank behind the  
Administration Charge, will often consider the amount of the Administration Charge and  
some may, as Romspen did here, specifically negotiate the amount.  
[
48] It is important to note, however, that the Administration Charge is intended, for the  
most part, to simply secure the professional fees, rather than being the primary source for  
payment (as is any retainer). Just as the Orders granted in this proceeding provide,  
professional fees are generally intended to be paid on an ongoing basis and in the ordinary  
course, usually from the cash on hand and any approved interim funding.  
[
49] In addition, the amount of the Administration Charge is an estimate only. CCAA  
proceedings are inherently unpredictable and intentions/forecasts to pay professionals may  
not always be realized. The professional firms that work in the insolvency arena are highly  
sophisticated. It is incumbent upon them to ensure that they are being paid as intended. The  
Monitor will typically report on the status of the payment, or non-payment, of professional  
fees in advance of any later hearings. That said, if the risk to the professionals who are  
intended to be paid is increasing, particularly to the point where it may exceed the settled  
Administration Charge, it is incumbent on those professionals to address the matter within a  
reasonable period of time to avoid any difficulties. By addressing the matter, I would include  
alerting other stakeholders who may be affected and possibly applying to increase the charge,  
although I appreciate that cost considerations may come into play in respect of any court  
application to do so and its timing.  
[
(
50] Unfortunately, in the past, there have been instances where the professional fees  
including as incurred by the monitor) were not paid and the claimed fees exceeded the  
charge. This puts the stakeholders and the Court in a difficult situation, where prior  
expectations (whether reasonable or not) can be challenged in light of what may be changed  
circumstances for the stakeholders. It can also be the case that any dispute concerning a  
professional’s claim to further fees and/or a charge puts the feasibility of the entire proceeding  
at risk, as was discussed in Timminco.  
[
51] All of these factors point to the fact that the professionals in CCAA proceedings must be  
proactive in their approach to how and when they are to be paid. Such professionals must also  
be proactive in addressing the ongoing viability of the protections that were put in place for  
their benefit at the outset.  
[
52] I accept of course that administration charges can and sometimes are increased in the  
midst of CCAA proceedings, as may be appropriate. In that event, the Canwest Publishing  
factors are a helpful guide as to whether an increase is warranted. As stated, the assessment  
requires an estimate of what amount is appropriate to secure the anticipated fees. Each case  
will depend on the specific facts and circumstances, both historically and what might be  
expected into the future.  
[
53] The only case cited on this application concerning an increase of an administration  
charge which was refused is Boutique Euphoria inc. (Arrangement relatif à), 2007 QCCS 7127  
BE Admin Charge]. The judgment is brief and must be read together with the concurrent  
[
decision of Justice Gascon, as he then was, in Boutique Euphoria inc., 2007 QCCS 7129 [BE  
Stalking Horse].  
[
54] In BE Stalking Horse, Gascon J. refused to approve the stalking horse bid. There, the  
court described that the CCAA proceedings were only in its early days. The initial order had  
been granted only about 30 days earlier when the outcome of the proceeding was uncertain  
and was possibly not just a liquidation. However, when this decision was rendered, the likely  
outcome of the proceeding had definitely turned for the worse. Justice Gascon described that  
the likely outcome was “not very positive” and that a liquidation was all but assured. It  
appeared that the likely recovery from the assets was substantially less than even what the  
secured creditors were owed (paras. 8–16 and 38).  
[
55] In BE Admin Charge at para. 3, Gascon J. renewed the initial order for a short time to  
allow the stakeholders to reassess the situation after his decision in BE Stalking Horse. The  
court also addressed and refused a request to increase the administration charge by $100,000:  
[
5]  
The following reasons lead the Court to so conclude:  
a)  
In the Initial Order, the Court precisely reduced the Administration Charge from  
$
300,000 to $200,000. There is no reason to review that decision thirty days later;  
b)  
c)  
The total recovery will likely not exceed 1.2 to 1.5 million dollars, at best;  
Because of that, any increase in the Administration Charge directly affects some  
secured creditors;  
d)  
At this moment, it remains to be seen whether there indeed still exists a reasonable  
prospect of a successful restructuring under the CCAA.  
[
6]  
In such a context, the Court considers that it is not justified to make use of the  
extraordinary measure of the priority charge to increase the extent of the Administration  
Charge.  
[
56] I consider BE Admin Charge as an example where changed circumstances in a CCAA  
proceeding may be relevant as to whether the court considers an increase in the  
administration charge to be appropriate, particularly where different elements of prejudice to  
the secured creditors may have arisen or become more apparent by that time.  
[
57] With these general comments in mind, I now turn to a consideration of the specific and  
unique circumstances which inform the issue before me.  
DISCUSSION  
[
58] Alderbridge’s sought-after increase in the Administration Charge of $455,000 is linked  
to unpaid amounts owing to Dentons of $454,348, identified above.  
[
59] Romspen takes the position that it would be inappropriate to elevate Dentons’  
outstanding and unsecured pre-filing fees over the claims of the other stakeholders, and as  
such, no additional fees should be paid to Dentons by securing them under the Administration  
Charge.  
[
60] The Monitor, in its Fourth Report, takes no position on this application. However, the  
Monitor states that, if the Administration Charge is to be increased as proposed, $200,000  
should be allocated to it and its counsel jointly. The Monitor confirms the payments to  
Dentons in respect of Romspen’s calculations that Dentons has been paid the amount of its  
post-filing accounts, as well as approximately $200,000, or what the Monitor considered were  
the reasonable pre-filing fees. This is demonstrated in the reports of the Proposed Monitor  
and the Monitor, including the cash flow forecasts and the Notes to those forecasts. In March  
2
022, Dentons and the first Monitor were paid for pre-filing work, approximately $185,000  
and $60,000, respectively.  
[
61] It is helpful to frame the discussion and Alderbridge and Romspen’s respective  
arguments around the relevant Canwest Publishing factors.  
Size and Complexity of Alderbridge  
[
62] At the initial hearing, I accepted that this restructuring was a complex one: Initial  
Reasons at paras. 18–19.  
[
63] Development projects that are not yet complete invariably involve some complexity  
and this one is no different. The scope of the nascent project is very large, proposing seven  
towers spanning a city block; at present, secured obligations stand at approximately  
$
346 million, with Romspen owed $185 million of that amount; leaving aside the substantial  
creditors, many other stakeholders are involved, including the City of Richmond and pre-sale  
purchasers; and finally, the financing necessary to move the project forward will necessarily be  
large and complex.  
[
64] There is no doubt that Alderbridge has made significant efforts to advance a  
restructuring, with the assistance of Dentons, in these complex circumstances. This factor  
weighed in favour of my conclusion at the initial hearing that Dentons should continue to be  
paid even after the filing with respect to its pre-filing fees, where the pre-filing fees are related  
to the restructuring.  
[
65] However, I agree with Romspen that the size and complexity of the matter has not  
changed in respect of the anticipated involvement of the CCAA professionals in this  
proceeding going forward. That is, the assistance required of Dentons in advancing the  
restructuring, and the protections that are therefore appropriate in that respect, remain the  
same. If anything, the assistance required of Dentons has been lessened since the SARIO now  
provides that Dentons no longer has a claim to the Administration Charge in respect of its fees  
incurred after August 11, 2022.  
[
66] In my view, this factor is neutral in terms of whether the Administration Charge  
should be increased.  
Proposed Role of Dentons / Duplication of Roles  
[
67] As I expressed in the Initial Reasons, I accept that Dentons’ services throughout its  
retainer have been toward assisting Alderbridge to advance its restructuring efforts.  
Alderbridge’s efforts were well documented in the evidence filed in support of the initial  
hearing. The evidence of Dentons’ specific involvement in those efforts has been recently  
supplemented for this application beyond counsel’s earlier submissions.  
[
68] Alderbridge and Dentons’ assertion respecting their efforts and services is undisputed  
on this application, including by Romspen. I also agree that Dentons’ efforts have been toward  
benefitting all stakeholders, including Romspen. That those efforts were not successful prior  
to the CCAA filing and were not successful to August 2022 is not relevant to this issue. The  
prior involvement and efforts of Dentons informed my conclusion at the initial hearing that  
Alderbridge should be allowed to pay Dentons in the course of this CCAA proceeding,  
including with respect to its reasonable pre-filing fees.  
[
69] There is also no dispute concerning Dentons’ involvement in the CCAA proceeding in  
terms of their role and the benefits derived from their services. Following the CCAA filing,  
Dentons has received payments equal to the value of its post-filing services, together with  
$
200,000 toward its pre-filing amount. Dentons has performed its role in these proceedings,  
just as was predicted at that time. Nothing has changed in that respect. As such, no issues  
arise with respect to advancing the policy objectives, discussed in Timminco and Canada  
North Group, in terms of protecting Dentons’ as a professional while it was engaged in the  
course of this CCAA proceeding.  
[
70] However, all of these circumstances (both in the past and as projected) informed the  
Court’s decision to set the Administration Charge at $300,000 at the time of the initial  
hearing.  
[
71] Again, I would emphasize that the proposed role of Dentons is a forward-looking  
factor that will typically inform the Court’s decision on the amount of the Administration  
Charge. What Alderbridge and Dentons really seek to do is to retroactively increase the  
Administration Charge effective to the time of the initial hearing to secure all of Dentons’  
pre-filing fees, after now realizing that the course of the restructuring will not result in those  
fees being paid. I will address that matter below.  
[
72] In conclusion, this factor does not support an increase in the Administration Charge.  
Dentons has no further involvement in that Charge for its post-August 11, 2022 fees and  
therefore, there is no duplication of roles that might be considered in terms of increasing the  
amount of the Administration Charge.  
Quantum of the Proposed Charge  
[
73] Again, no question arises with respect to the quantum of fees that Dentons has  
presented, including with respect to the pre-filing amounts.  
[
74] Alderbridge asserts that the proposed increase in the Administration Charge will not  
have a material effect on Romspen or the other secured creditors. It says that CIBT is unlikely  
to recover any amount.  
[
75] With respect to Romspen, Alderbridge says that the $355,000 increase will be  
immaterial” to Romspen, as representing less than 0.25% of the amount owed under its  
security. It further argues that, assuming that the Monitor and its counsel are paid in the  
ordinary course, and Dentons has full access to the increase in the Administration Charge, the  
practical effect is an erosion of Romspen’s security by $200,000, or 0.10% of Romspen’s  
loans.  
[
76] I have difficulty accepting that Alderbridge and Dentons are in a position to assert the  
materiality of the proposed increase on the part of Romspen.  
[
77] Looked at in isolation, the $355,000 increase is a significant sum. It may seem less  
significant in relation to Romspen’s overall indebtedness, but I am not convinced that is the  
appropriate approach.  
[
78] Clearly, Romspen considers the amount significant. It would not have mounted  
opposition to this application with the attendant costs without having come to that conclusion.  
Indeed, in light of the course of this CCAA proceeding, particularly the disappointing results of  
the SISP, the fortunes of Romspen have considerably dimmed. It is apparent from the  
financial information before the Court that there is even some question now as to whether  
Romspen will be paid all of its debt, let alone any payment to the other secured creditors.  
[
79] In BE Admin Charge at para. 5, the court explained that the downgrading of the  
creditor’s fortunes factored into their decision to refuse an increase to the administration  
charge. This is analogous to the case at bar. Just as here, that reversal of fortunes did not arise  
from any actions or decisions of the debtor, and I agree that the failure of the SISP cannot be  
laid at the feet of Alderbridge or Dentons. Nevertheless, it remains a reality of this  
restructuring that the risk of non-payment to the secured creditors, including Romspen, has  
materially increased.  
[
80] This factor does not support an increase in the Administration Charge.  
Position of Romspen  
[
81] Alderbridge submits that it is appropriate to “revisit” the quantum of the  
Administration Charge.  
[
82] Alderbridge places great emphasis on its and Dentons’ “understanding” and intentions  
at the time of the initial hearing that Dentons’ outstanding pre-filing accounts would be paid.  
They assert that Dentons has not been paid “as anticipated, despite an order of this Court  
requiring such payment”, said to be supported by my comments in the Initial Reasons. They  
refer to their “reasonable expectations” that Dentons would be paid, based on the cashflow,  
the terms of the Initial Order and the statements by the Court in the Initial Reasons.  
[
83] With respect, Alderbridge has read more into the Initial Order and the Initial Reasons  
than are warranted. The Initial Order did anticipate that Dentons would be paid after the  
filing but it did not require that any payments be made. Paragraph 5 provides that Alderbridge  
was “entitled, but not required” to pay these amounts. Paragraph 31 similarly authorizes  
payment of Dentons’ fees only “as part of the costs of these proceedings”. Similarly, although  
the Initial Reasons are not the controlling provisions (the Initial Order is). At para. 21 of the  
Initial Reasons, I accepted that Alderbridge should be authorized to make these payments  
after the filing when I stated:  
reasonable amounts relating to the period before the filing may be appropriately paid after  
the CCAA filing.  
[
[
Emphasis added.]  
84] The Initial Order did not elevate or secure the payment of Dentons’ pre-filing amounts  
in any fashion. The authorized payments to Dentons after the filing were in no different  
position than any other post-filing payments that might have become owing, or such pre-filing  
payments as were authorized by the Court to be paid, but not secured.  
[
85] A review of the April 1, 2022 transcript and the exchanges between Alderbridge’s  
counsel and the Court at the time of the initial hearing supports what was eventually granted  
in the Initial Order. At that time, counsel advised that payment for professional fees to the  
comeback hearing was to come from the Gatland interim financing (then estimated at  
$
1 million) to both pay ongoing amounts and to get Dentons “caught up”. Dentons also  
confirmed what the math revealed—that the estimated payment to professionals under the  
cash flow ($555,000), after payment of the retainers ($150,000), would not be sufficient to  
pay Dentons, the Monitor and its counsel for their costs to the comeback hearing (including  
the “lead-up costs”) and also, pay Dentons’s outstanding accounts. Significantly, Alderbridge  
agreed that the funds for these costs were to come from the creditors ranking behind  
Romspen.  
[
86] At bottom, the Court allowed Alderbridge to pay Dentons’ pre-filing amount, but did  
not require such payment, let alone payment of the full amount of Dentons’ accounts. These  
payments were allowed, as requested by Alderbridge, and not contested by Romspen, in the  
expectation that a successful restructuring would materialize. However, just as with other  
post-filing obligations, no security was granted in the Initial Order (or the later ARIO and  
SARIO) with respect to the pre-filing legal fees.  
[
87] Alderbridge and Dentons also refer to the cash flow forecasts, discussed above. In its  
Fourth Report, the Monitor reports that Dentons has received $134,379 less than forecast, but  
Alderbridge asserts that the shortfall is actually around $300,000 since the Monitor revised  
the initial forecast in its Third Report dated July 20, 2022 to reduce the amount of  
professional fees to be paid.  
[
88] Alderbridge refers to their “reasonable expectations” that the pre-filing amounts would  
be paid. It alleges that Romspen advanced $223,000 less than forecast under its initial interim  
financing. Alderbridge says that it appears that Romspen:  
intentionally took steps to cause [Alderbridge] to short payment to Dentons despite the  
reasonable expectations of the parties on April 1, 2022 and April 25, 2022.  
[
89] Alderbridge also states that it “understood” that the Monitor was unable or unwilling  
to facilitate payments of the pre-filing amounts to Dentons given Romspen’s position and/or  
Romspen not providing the required forecasted advances under the Romspen interim  
financing.  
[
90] I cannot discern any basis upon which Alderbridge can rely on the various cash flow  
forecasts as somehow guaranteeing payment of the pre-filing fees. Cash flow forecasts are just  
that—forecasts. They are not scripts written in stone as to future disbursements that the  
debtor must pay.  
[
91] Cash flow forecasts are prepared based on expectations as to what will occur in the  
future, depending on the course of the restructuring. In fact, here the Monitor’s various  
reports specifically noted in the cash flow forecasts, at Note 8, that the amounts were based on  
what was estimated as the professional costs “relating” to the CCAA proceedings and what was  
termed the “lead up” costs. This is akin to how both Romspen and the Monitor view the  
amounts paid to Dentons after the filing—namely, that this was equal to the amount of  
Dentons’ post-filing fees and what was considered a reasonable amount for the preparation of  
the CCAA filing just before April 2022 (about $200,000).  
[
92] In addition, there is no evidence that Romspen undertook a specific campaign to  
withhold advances under its first interim financing facility in order to shortchange payments  
to Dentons. Advances under such facilities are made as circumstances require, given the  
obvious need to reduce financing costs if the cash is not needed. Even if those amounts had  
been advanced, there is nothing to indicate that they were guaranteed to land in the pockets of  
Dentons.  
[
93] In fact, under the ARIO, Alderbridge was still fully in control of its finances, subject to  
the Monitor’s oversight. At no point did Alderbridge make any requests for advances from  
Romspen, which Romspen refused, as this would presumably constitute a breach of the  
funding agreement. Similarly, the Monitor does not report that this occurred. When the ARIO  
was granted, no one, let alone Alderbridge, sought to increase the Administration Charge,  
particularly when the Monitor reported that payment of professional fees was $153,000 less  
than forecasted only weeks earlier. Alderbridge did not raise the matter of non-payment of its  
pre-filing fees (or the forecasted fees) at that time.  
[
94] In that event, I cannot see any basis for Alderbridge to assert that the Initial Order  
and/or the cash flow forecasts provided any reasonable basis for it assuming that these pre-  
filing amounts would be paid.  
[
95] I also do not consider the fact of non-payment to Dentons after the filing as  
representing a change in the factual matrix that would support an increase in the  
Administration Charge. I agree the factual matrix has changed in respect of the overall  
prospects for a restructuring; however, with respect to the possibility that Dentons’ fees will be  
paid arising from this CCAA restructuring, nothing has changed. It always was uncertain  
whether Dentons would be “caught up” for its pre-filing fees.  
[
96] At the initial hearing, Alderbridge specifically sought and obtained the Administration  
Charge in the amount of $300,000. At that time, Dentons’ was owed approximately $575,000.  
If Dentons had sought to secure payment of this amount through the Administration Charge,  
then I no have no doubt that the initial hearing would have been quite different. I also strongly  
suspect that Romspen would have strongly opposed that relief and threatened a receivership,  
based on Alderbridge’s consent to a receivership.  
[
97] My views are consonant with Romspen’s position on this application. As Romspen’s  
counsel submits, the terms of the CCAA filing were the result of a careful negotiation and  
compromise between Alderbridge and Romspen. The $300,000 limit of the Administration  
Charge was carefully negotiated in the context of allowing Alderbridge some further time to  
sort out a restructuring within this CCAA proceeding, which would hopefully fully repay  
Romspen. Failing agreement, a receivership would inevitably have resulted, in which case  
there is no doubt that Dentons would not have been paid from the assets for its pre-filing fees.  
Further, as agreed, the financing of the professional fees to the comeback hearing were on the  
account of Gatland, not Romspen. The later Romspen interim financing was only put in place  
because Alderbridge could not secure the next tranche that was needed to continue the  
proceedings.  
[
98] Alderbridge does not dispute that this was the backdrop to the granting of the Initial  
Order.  
[
99] I agree with Romspen that it reasonably expected that its exposure under the  
Administration Charge would be only $300,000, unless it otherwise agreed.  
[
100] In this context, I consider Alderbridge’s attempt to “revisit” the amount of the  
Administration Charge to secure Dentons’ pre-filing fees to be unfair to Romspen and  
unreasonable in the circumstances. At bottom, Alderbridge seeks to retroactively change key  
aspects of the earlier agreement of the parties in terms of the amount of the Administration  
Charge, which would unjustly prejudice Romspen.  
[
101] I agree with Romspen that this case presents a unique set of circumstances in which to  
consider an increase to the Administration Charge in that, viewed from a certain angle, that  
increase is sought to secure pre-filing amounts still owing to Dentons. I acknowledge that  
Dentons was entitled to apply the post-filing payments to its earlier invoices. However, I agree  
with Romspen’s analysis as to how the amount paid to Dentons during the CCAA proceedings  
(
$427,621) should be considered. That is, Dentons has been paid all of its post-filing accounts,  
and approximately $200,000 of its pre-filing fees. Dentons’ allocation of amounts paid does  
not change my view of the matter, particularly in terms of assessing Dentons’ involvement in  
this proceeding, the post-filing payments it has received in this proceeding, and in light of the  
CCAA policy objectives that I referred to above.  
[
102] Dentons was and is entitled to the protections that were put in place under the Orders  
granted in this proceeding. However, in essence, Alderbridge now seeks a retroactive  
guarantee of the payment of the pre-filing fees at the expense of Romspen, which is neither  
fair nor reasonable.  
CONCLUSION  
[
103] I conclude that it is inappropriate to increase the Administration Charge, as requested.  
[
104] In the alternative, Alderbridge seeks an order that the entire Administration Charge be  
allocated to Dentons. I also decline to grant that relief. There is no basis upon which to  
suppose that Romspen will purposefully withhold ongoing payments to the Monitor and its  
counsel so as to soak up the entire Administration Charge amount (assuming, for the sake of  
argument, that the Monitor would claim priority to the entire Administration Charge). I  
expect that the Monitor will report from time to time on the status of it and its counsel’s fees  
and Alderbridge will be provided copies of those reports. Any concerns that arise may be  
brought to the attention of the Court.  
[
105] I appreciate that Alderbridge and Dentons will be disappointed by this result. However,  
Dentons is a sophisticated law firm who is well able to assess whether to continue with a  
client’s retainer without current payments or without adequate protections for payment. The  
fact that payment for Dentons did not materialize through what was hoped to be a successful  
CCAA restructuring is but one part of the story.  
[
106] The application is dismissed.  
Fitzpatrick J.”  
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