Harmon International Industries Inc. Applicant/Proposed Appellant (Respondent) v. Hardie & Kelly Inc.,, 2020 SKCA 95

Court of Appeal for Saskatchewan Docket: CACV3667 Citation: Re Harmon International Industries Inc., 2020 SKCA 95Date: 2020-08-06 Between:Harmon International Industries Inc.Applicant/Proposed Appellant (Respondent)AndHardie & Kelly Inc., receiver of Harmon International Industries Inc.Respondent/Proposed Respondent (Applicant)AndPillar Capital Corp.Interested Party (Initial Applicant)AndThe City of SaskatoonInterested PartyBefore: Jackson J.A. (in Chambers)Disposition: Applications dismissedOn application from: QB 1401 of 2019, SaskatoonApplication heard: July 30, 2020Counsel: Ryan Pederson for the Applicant Jeffrey Lee, Q.C., and Paul Olfert for the Respondent (Hardie & Kelly) Mike Russell and Kevin Hoy for Pillar Capital Corp.

Alan Rankine for the City of Saskatoon Jackson J.A. I. Introduction [1] The issues in this application concern whether Harmon International Industries Inc. [Harmon] is entitled to pursue an appeal inthe Court of Appeal from a sale process order made under the Bankruptcy and Insolvency Act, RSC 1985, c B-3 [BIA].

In addition toaddressing questions of fresh evidence and late filing, the issues involve the application of this Court’s recent decisions in Patel v Whiting,2020 SKCA 49 (in Chambers) [Patel], and MNP Ltd. v Wilkes, 2020 SKCA 66 [Wilkes]. [2] By way of introductory background, the assets of Harmon are currently the subject of a receivership order made under theBIA. As part of that ongoing process, the receiver, Hardie & Kelly Inc., obtained a sales process order [Order].

The Order authorizes thereceiver to enter into two listing agreements with ICR Commercial Real Estate [ICR] to effect a sale of the Harmon assets and also sets alisting price. It is that Order that Harmon seeks to appeal. [3] The Order was issued on June 5, 2020. On June 11, 2020, Harmon’s former counsel served a notice of withdrawal of solicitoron the receiver and the senior secured creditor, Pillar Capital Corp. [secured creditor]. At the same time, Harmon’s former counsel alsoserved an application for leave to appeal and a draft notice of appeal on the same parties.

These latter documents were, however, not filedwith the Court of Appeal until July 9, 2020, thus placing Harmon beyond the 10-day time limit for appealing orders made under the rulesestablished for the BIA (see s. 31 of the Bankruptcy and Insolvency General Rules, CRC, c 368 [the General Rules]). [4] In addition to its application for leave to appeal, Harmon applies (

a) to adduce fresh evidence in the form of an appraisal attesting to the value of its assets as being in excess of the listing pricecontained in the Order; (

b) to extend the time to appeal under s. 31 of the General Rules; and (

c) for an order imposing a stay of the Order pending the hearing of the appeal. [5] In support of its position, in addition to filing a fresh evidence application, Harmon has filed two briefs of law. Harmon’s firstposition is that, contrary to its application for leave to appeal, it has an appeal as of right under s. 193(

c) of the BIA such that leave is notrequired, and that, in light of this, it should not be deprived of exercising that right by virtue of the confusion surrounding the serving andfiling of the application for leave to appeal. In the alternative, Harmon submits that leave to appeal should be granted under s. 193(

e) ofthe BIA as its appeal is sufficiently meritorious and sufficiently important to justify such orders and leave to extend the time to appealshould be granted for the same reasons. It did not pursue its application for a stay because if the appeal were permitted to proceed, anautomatic stay would be imposed. [6] Both the receiver and the secured party oppose all applications. They assert that (

a) leave is required under s. 193(

e) of theBIA, and (

b) the appeal is neither sufficiently meritorious nor sufficiently important to the practice of law or to this specific receivership towarrant leave being granted. Indeed, they submit that the appeal is destined to fail, which, in their submissions, disposes of both theapplication for leave to appeal and the application to extend the time to appeal. They resist the application to adduce the fresh evidence asnot meeting the Palmer criteria for the admission of same (R v Palmer, (SCC), [1980] 1 SCR 759). Finally, as a means of

demonstrating prejudice to the receivership and the secured party, the receiver has filed a second report indicating all that has been done to date to proceed with the sale of the property. The receiver indicated that if the appeal is permitted to proceed, it would be filing a subsequent application in order to lift the stay so as to allow the sales process to continue. [ 7 ] The various applications and submissions give rise to these issues: (

a) Should the fresh evidence be received? (

b) Is Harmon required to apply for leave to appeal under s. 193 (

e) of the BIA , or does it have an appeal as of right under s. 193 (

c) of the BIA ? (

c) If Harmon is required to apply for leave to appeal, should leave be granted? (

d) Should the time to appeal be extended? [ 8 ] For the reasons that follow, I have concluded the following: (

a) the fresh evidence should not be admitted; (

b) Harmon requires leave to appeal as it does not have an appeal as of right; and (

c) leave to appeal should not be granted. [ 9 ] In light of my conclusions in relation to (

b) and (c), it would not be strictly necessary to consider whether to extend the time to appeal. In the interest of completeness, however, I have gone on to consider that question and have concluded that, in any event, I would not grant leave extending the time to appeal. II. Background to the Order [ 10 ] In July of 2018, Harmon obtained a credit facility to the maximum principal amount of $3,300,000 from the secured creditor.

To secure the loan, Harmon granted a general security agreement over all present and after-acquired property, a collateral mortgage on certain real property, a general assignment of rents and a promissory note to the value of $3,300,000, plus interest and other amounts owing from time to time. The real property comprises an approximately 18,000 square foot commercial building [the 821 Building], and an approximately 62,000 square foot commercial building [Millar Avenue Building]. [ 11 ] Harmon defaulted on the loan.

On September 30, 2019, the secured creditor applied to the Court of Queen’s Bench for an order appointing Hardie and Kelly Inc. as the receiver of all of the assets, undertakings and properties of Harmon. The application was adjourned on several occasions. On January 17, 2020, Elson J., who had been the Queen’s Bench judge supervising the Harmon receivership, granted the requested order.

As of May 21, 2020, Harmon owed the secured creditor approximately $4,501,644, with interest accruing at approximately $3,616 per day. [ 12 ] On May 29, 2020, the receiver served Harmon with an application proposing that the receiver enter into two listing agreements naming ICR as the listing agent. The first listing agreement sets the list price of the Millar Avenue Building at $3.8 million and the second listing agreement sets the list price of the 821 Building at $740,000.

Harmon did not object to either property being sold but submitted that Coldwell Banker Signature Commercial [Coldwell Banker] should be substituted as the listing agent rather than ICR and that the initial listing price for the Millar Avenue Building should be $4.95 million. It does not appear that any serious objection was made regarding the list price for the 821 Building. [ 13 ] In support of a listing price of $4.95 million for the Millar Avenue Building, Harmon relied on these pieces of evidence: (

a) Colliers McClocklin Real Estate Corp. had previously listed it for $5,250,000 in 2018; (

b) Ken Kreutzwieser of ICR had initially valued it at $5,125,000; (

c) ICR had listed it for $5,295,000 in 2019; (

d) Coldwell Banker had offered to list the property for $4,950,000 in 2020; and (

e) William R. I. Brunsdon, a partner of the firm Brunsdon Lawrek & Associates, had appraised the Millar Avenue Building at $5,500,000 in 2017 [Brunsdon Appraisal]. [ 14 ] Justice Elson granted the Order in substantially the form requested, with ICR as the listing agent and fixing a list price of $3.8 million for the Millar Avenue Building and $740,000 for the 821 Building.

In a brief oral fiat, Elson J. stated as follows: The principals of Harmon International Industries Inc. have been granted indulgences in the past, not only by the court but also by the patience of the receiver, since the receivership order was put in place. Those indulgences must now come to an end. [ 15 ] As I have indicated, it is from this decision that Harmon seeks to appeal. In its amended form, the draft notice of appeal contains one ground of appeal only: (

b) That the Learned Chambers Judge erred in fact and/or in law in failing to conclude that ICR Commercial Real Estate was intending to list the Harmon Lands, as described in the Sales Process Order, at a value significantly less than fair market value … .

III. Fresh Evidence A. Nature of the evidence and positions of the parties [16] Harmon’s proposed fresh evidence is composed of two affidavits. The first affidavit is of Calvin Moneo, who is a director,officer and shareholder of Harmon. He states that, prior to being served with the receiver’s notice of application on May 29, 2020, he hadno knowledge that the suggested listing price would be so low. In his opinion, there had been insufficient time between the date of serviceand the date of the hearing for him to obtain an updated appraisal.

He states further that almost immediately after the Order issued on June5, 2020, i.e., on June 8, 2020, he contacted Mr. Brunsdon to order an updated appraisal of Harmon’s real property, including the MillarAvenue Building. [17] The second affidavit is from Mr. Brunsdon. He indicates he conducted an inspection of the Millar Avenue Building and the 821Building. He determined that the former had a market value of $6 million and the latter had a market value of $930,000 both as of June 15,2020.

He attached his appraisal as an exhibit to his affidavit. [18] Harmon submits that its proposed fresh evidence meets the Palmer test for the admission of fresh evidence as recently stated inRisseeuw v Saskatchewan College of Psychologists, 2019 SKCA 9 at para 19, [2019] 2 WWR 452 [Risseeuw]. In Risseeuw, this Courtaffirmed the four-part test for accepting fresh evidence: (

a) the evidence will not be admitted, if by due diligence it could have beenadmitted at trial; (

b) the evidence must be relevant in the sense that it bears upon a decisive or potentially decisive issue in the action; (c)the evidence must be credible in the sense that it is reasonably capable of belief; and (

d) the evidence must be such that if believed it couldreasonably, when taken with the other evidence adduced at trial, be expected to have affected the result. [19] The receiver opposes the fresh evidence application. The receiver submits that, on this appeal from an interlocutory order,Court of Appeal Chambers is not the place to assess evidence of this nature, saying, if it is truly fresh evidence, the proper place to assessits cogency is the Court of Queen’s Bench. If this evidence were placed before that Court, the receiver states that it would seek to cross-examine Mr. Brunsdon.

The receiver submits further that this updated appraisal is hardly more current than some of the other evidencethat Elson J. rejected and could not have been expected to have affected the result in any event. [20] The secured party takes the view that the four-part test for the admission of fresh evidence has not been met and suggests that Ishould be highly sceptical of Mr. Moneo’s statement that he was taken by surprise given all that had transpired since the appointment ofthe receiver in January of 2020.

The secured party points out that if Harmon had been taken by surprise, it must be noted that its counseldid not seek an adjournment of the receiver’s application to obtain the Order. B. Analysis [21] While Harmon’s application is framed as an application to adduce fresh evidence, this Court has held that a single judge of theCourt does not have the authority “to grant leave pertaining to the reception of further evidence” (Turbo Resources Ltd v Gibson (1987), (SK CA), 60 Sask R 221 (CA) at para 19 [Turbo]).

As the Court indicated in Turbo, and as Rule 59 of The Court ofAppeal Rules provides, a fresh evidence application must be made in the context of an appeal to the Court itself. For a recent statement ofthis principle, see C.L.B. v J.A.B., 2016 SKCA 18 at para 24, 476 Sask R 1, and Haug v Dorchester Institution, 2016 SKCA 55 at para 3,[2016] 10 WWR 484. [22] In light of this, I have treated the application to adduce this evidence as “material upon which the applicant relies to support”Harmon’s application that leave to appeal should be granted and its application to extend the time to appeal (see Rule 48(1)(

b) of TheCourt of Appeal Rules). But, even with this approach, I still have some difficulty with this proposed fresh evidence. This is so because,even if I agreed to accept this evidence for the purposes of this Chambers application, and, as a result of it, I were to grant leave to appeal,there is no guarantee that the panel of the Court ultimately hearing the appeal would admit the evidence on the appeal proper.

In otherwords, my acceptance of the fresh evidence would not bind the Court in any event. [23] If this evidence were taken on its own, and at face value, the receiver would have granted an improvident listing agreement, buton what basis can I, as the Chambers judge, assess this untested evidence? Confronted by this issue, if the Court were satisfied with thecredibility and reliability of the evidence and Harmon’s due diligence, the Court would have the authority to remit the matter to Elson J. toassess the evidence.

In my view, I, as a single judge, do not have that authority as I would then be disposing of the appeal. It seems to methat the better place to assess this evidence is the Court of Queen’s Bench. [24] All parties agree that the Order is interlocutory. A further order of the Court of Queen’s Bench will be needed to confirm anysale of Harmon’s properties. Further, I also note that s. 187(5) of the BIA provides that “[e]very court may review, rescind or vary anyorder made by it under its bankruptcy jurisdiction”.

Court in s. 187(5) means a court that has been vested with jurisdiction by the BIA (i.e.,by s. 2 and s. 183(1) working in tandem), which means the Court of Queen’s Bench in this province (see s. 183(1)(f)). Subsection 187(5)permits a judge to deal with continuing matters if new evidence comes to light. The court’s discretion must be exercised judicially, havingregard for a wide range of factors, including if it is just and expedient in the control of its own process: see, generally, L.W. Houlden, C.H.Morawetz and J.

Sarra, “Power of Court to Review, Rescind or Vary an Order”, Bankruptcy and Insolvency Law of Canada, loose-leaf(Rel 2012-07) 4th ed, vol 3 (Toronto: Thomson Reuters, 2009) at I§24 [Houlden, Morawetz & Sarra]. [25] I would not want to be taken as saying there can be no instance when a Chambers judge hearing an application under s. 193 ofthe BIA or s. 31 of the General Rules could receive such material under Rule 48(1)(b).

However, in this case, the proper place to assessthis new evidence is the Court of Queen’s Bench, either on the basis of a s. 187(5) application or as part of the application to approve anysale of the property that might ensue. [26] Thus, I would dismiss the application to adduce fresh evidence and have not considered it for any other purpose.

IV. Leave to Appeal is Required to Advance the Appeal A. Introduction to the leave issue [27] The primary provisions under consideration in this application are s. 193(

c) and (

e) of the BIA. They read as follows: Appeals AppelsCourt of Appeal Cour d’appel193 Unless otherwise expressly provided, an appeal lies to the Courtof Appeal from any order or decision of a judge of the court in thefollowing cases: 193 Sauf disposition expressément contraire, appel est recevable à laCour d’appel de toute ordonnance ou décision d’un juge du tribunaldans les cas suivants :(

c) if the property involved in the appeal exceeds in value tenthousand dollars;

c) les biens en question dans l’appel dépassent en valeur la somme dedix mille dollars;(

e) in any other case by leave of a judge of the Court of Appeal.

e) dans tout autre cas, avec la permission d’un juge de la Courd’appel.RS, 1985, c B-3, s 193 1992, c 27, s 68. LR (1985), ch B-3, art 193 1992, ch 27, art 68. [28] Harmon initially applied for leave to appeal under s. 193(

e) of the BIA. However, when Harmon’s application was heard, itsfirst position was that it had an appeal as of right under s. 193(

c) such that its application for leave to appeal should be dismissed. But, if Idetermined that Harmon did not have an appeal as of right, it was submitted that leave to appeal should be granted. In describing theprocess in this manner, Harmon relied on Patel. In Patel, Leurer J.A. held that where an application for leave to appeal is made whenleave to appeal is not required, the proper procedure is to dismiss the application. If the party applying for leave is out of time, the nextstep is to consider whether leave to file late should be granted.

Thus, following Patel, I will determine whether Harmon has a right ofappeal as a preliminary issue. [29] In asserting a right of appeal under s. 193(

c) of the BIA, Harmon relies on Wilkes. In Wilkes, this Court, on an application tostrike an appeal on the basis that leave to appeal was required and had not been obtained, opted to follow a line of authority stemmingfrom Orpen v Roberts, [1925] 1 SCR 364 [Orpen], and Fallis v United Fuel Investments Limited, (SCC), [1962] SCR 771[Fallis], i.e., the Orpen–Fallis line. [30] In Wilkes, I wrote for the Court and drew these principles from the Orpen–Fallis line: [61] While it is solidly established in the jurisprudence that there is no right of appeal under s. 193(

c) from a question involving procedurealone, courts should not start with that question. The primary task is to answer the question raised by s. 193(

c) and determine whether theproperty involved in the appeal exceeds $10,000. Courts have used different ways of giving meaning to s. 193(c), but it is still the wordsof the statute that govern. Thus, in Fallis, by its adoption of what the Court had said in Orpen, the test is stated as, What is the loss whichthe granting or refusing of the right claimed will entail? In Fogel, the Court asked what is “the value in jeopardy” (at para 6).

In McNeil,the Chambers judge observed that “[t]he ‘property involved in the appeal’ … may be determined by comparing the order appealed againstthe remedy sought in the notice of appeal” (at para 13). In Trimor, the Chambers judge added to the Orpen–Fallis test by stating “[t]hefocus of the inquiry under s. 193(

c) is the amount of money at stake …” (at para 10). All of these expressions are consistent with thestatutory language present in s. 193(c). [62] In answering any of those questions, an appeal court may determine that there is no property involved in the appeal exceeding invalue $10,000 but rather that the question in issue is procedural only. But merely because the question in issue is procedural, does notnecessarily mean there is not property involved in the appeal that exceeds in value $10,000. An issue can be procedural while also havingmore than $10,000 at stake.

In examining this principle further, it is helpful to look again at the three leading cases that put forward theproposition that the property involved in the appeal did not exceed $10,000 because the question in issue was procedural: (

a) Coast [ (BC CA), [1926] 2 WWR 536 (BCCA)] – the issue was whether the Chambers judge had erred by permittingthe bringing of an action rather than requiring the matter to be heard in Chambers; (

b) Dominion Foundry [(1965), (MB CA), 52 DLR (2d) 79 (Man CA)] – the issue pertained to the manner of sale; and (

c) Pine Tree [2013 ONCA 282] – the issue was whether a receiver should have been appointed or not. It should be noted that the reported decisions do not show that the proponent of a right of appeal in these cases put forward evidence toshow that the procedural issue in question had resulted in or could result in a loss. [63] It is one thing to say there is no appeal as of right under s. 193(

c) from an order that directs a receiver as to the manner of salebecause the “property involved in the appeal [does not exceed] in value ten thousand dollars” where no claim of loss is alleged.Classifying such an order as procedural appears to have no consequence because the complaint is about the choice of procedure that thetrustee or receiver made rather than about the value of the property (Dominion Foundry). It is quite another matter to say there is no rightof appeal under s. 193(

c) from any order that is procedural in nature when there is a claim of loss in excess of $10,000. In short, courtsmust be careful not to extrapolate from decided cases to reduce every choice that a trustee or a receiver makes to a question of procedureso as to deny a proposed appellant a right of appeal. The issue in s. 193(

c) is whether based on the evidence there is at least $10,000 atstake, not whether the order is procedural. [64] According to the Orpen–Fallis line of authority, which I believe this Court should follow, an appellate court’s task is to determinefirst and foremost whether the appeal involves property that exceeds in value $10,000, i.e., to answer the question posed by s. 193(c). It isnot necessary that recovery of that amount be guaranteed or immediate. Rather the claim must be sufficiently grounded in the evidence tothe satisfaction of the Court determining whether there is a right of appeal.

As the Court in Fallis indicated, the determination of theamount or value may be proven by affidavit. It may be that a court will conclude that the appeal does not involve property that exceeds in

value $10,000, but rather involves a question of procedure alone, but one does not begin with the second question first. In my view, this isan important distinction. (Italic emphasis in original, underline emphasis added) B. Analysis [31] In the receiver’s Chambers application before Elson J., Harmon submitted that the Millar Avenue Building should have beenlisted at $4,950,000 rather than $3,800,000. The issue is whether the difference between these two numbers represents a claim of losssufficient to ground a right of appeal in s. 193(

c) of the BIA. [32] As the Orpen–Fallis line of authority indicates, the question is, “What is the loss which the granting or refusing of the rightclaimed will entail?” In answering this question, recovery of the claimed amount need not “be guaranteed or immediate”, but the claimmust be “sufficiently grounded in the evidence to the satisfaction of the Court determining whether there is a right of appeal” (Wilkes atpara 64).

As I review Harmon’s claim, I am not satisfied that Harmon’s proposed claim of loss is sufficiently grounded in the evidence. [33] It must be understood that Harmon does not contest that the Millar Avenue Building must be sold, and that it is going to be soldthrough the receivership process. It also must be understood that any sale of the property must be confirmed by further order of the Courtof Queen’s Bench. The interlocutory nature of the Order is made clear by its paragraph 2, which provides as follows: 2.

Any proposed sale of any Harmon Lands Property by the Receiver which is identified as a result of the Sale Process shall be conditionalupon the Receiver obtaining a further Order of this Court approving such proposed sale and vesting title to such Harmon Lands Property inthe name of the proposed purchaser. [34] Thus, what the Court has before it is an Order that authorizes a list price of $3.8 million for the Millar Avenue Building. It doesnot propose a sale price of $3.8 million. All that the Order does is establish a process for the sale of the property.

Any proposed sale muststill be confirmed. [35] At this point, the claim of loss is without any foundation at all. It is, as such, entirely speculative. It assumes that the listingagent will not market the property to its fullest potential or that the receiver will place an improvident sale before the Court of Queen’sBench to be confirmed and the Court will confirm it.

It is possible that Harmon will apply to Elson J. under s. 185(7) of the BIA or waituntil it is determined that the property is proposed to be sold for less than what Harmon believes it is worth and place the BrunsdonAppraisal before Elson J. at that time. It is also possible that Harmon will obtain other financing so as to permit it to buy the property atthe list price or the property will sell for an amount acceptable to Harmon. In my view, the Order does not directly have an impact on theproprietary or monetary interests of Harmon or crystallize any loss at this time. It concerns a matter of procedure only.

It is merely anorder as to manner of sale, as was the case in Dominion Foundry Co. (Re) (1965), (MB CA), 52 DLR (2d) 79 (ManCA). No value is in jeopardy, and no party can claim a loss as a result. In my view, the property involved in the proposed appeal does notexceed in value $10,000 as those words are used in s. 193(

c) of the BIA. Thus, I conclude it was necessary for Harmon to apply for leaveto appeal. V. Leave to Appeal should not be Granted [36] That brings me to Harmon’s initial application for leave to appeal under s. 193(c). Rothmans, Benson & Hedges Inc. vSaskatchewan, 2002 SKCA 119, 227 Sask R 121 [Rothmans], sets the test for leave to appeal as follows: [6] The power to grant leave has been taken to be a discretionary power exercisable upon a set of criteria which, on balance, must beshown by the applicant to weigh decisively in favour of leave being granted: Steier v.

University Hospital, (SK CA),[1988] 4 W.W.R. 303 (Sask. C.A., per Tallis J.A. in chambers). The governing criteria may be reduced to two – each of which features asubset of considerations – provided it be understood that they constitute conventional considerations rather than fixed rules, that they arecase sensitive, and that their point by point reduction is not exhaustive.

Generally, leave is granted or withheld on considerations of meritand importance, as follows: First: Is the proposed appeal of sufficient merit to warrant the attention of the Court of Appeal? • Is it prima facie frivolous or vexatious? • Is it prima facie destined to fail in any event, having regard to the nature of the issue and the scope of the right of appeal, forinstance, or the nature of the adjudicative framework, such as that pertaining to the exercise of discretionary power? • Is it apt to unduly delay the proceedings or be overcome by them and rendered moot? • Is it apt to add unduly or disproportionately to the cost of the proceedings?

Second: Is the proposed appeal of sufficient importance to the proceedings before the court, or to the field of practice or the state of thelaw, or to the administration of justice generally, to warrant determination by the Court of Appeal? • does the decision bear heavily and potentially prejudicially upon the course or outcome of the particular proceedings? • does it raise a new or controversial or unusual issue of practice? • does it raise a new or uncertain or unsettled point of law? • does it transcend the particular in its implications?

(Emphasis in original) [37] In Paulsen & Son Excavating Ltd v Royal Bank, 2012 SKCA 101 at para 12, 399 Sask R 283, Richards J.A. (as he then was)confirmed that the test for leave to appeal, set out in Rothmans, applies with equal force to applications for leave to appeal in bankruptcyand insolvency matters. [38] Harmon’s appeal, as amplified by its submissions on this application, can be summarized as an assertion of two points: (

a) the Chambers judge erred by admitting as evidence an appraisal by Suncorp Valuations [Suncorp Appraisal]; and (

b) the Chambers judge erred by weighing the evidence as he did so as to set a list price of $3.8 million. [39] The first question is a question of law. Harmon submits that the Chambers judge should have rejected the Suncorp Appraisalbecause it was exhibited to the affidavit of Kevin Hoy, who is counsel to the secured creditor. According to this argument, the Chambersjudge should have applied the authorities, prohibiting the filing of evidence on substantive or contentious matters by way of a lawyer’saffidavit.

Harmon relies on the following: Crouser v 493485 Alberta Ltd., [1996] AJ No 967 (QL) (Alta QB); Owen v White Bear LakeDevelopment Corp., (SK KB), [1997] 7 WWR 296 (Sask QB) at para 7; and Pavao v Ferreira, 2018 ONSC 1573, 36E.T.R. (4th) 307. The problem with this argument is that no objection was taken to the admission of this evidence before the Chambersjudge. In my view, that is the complete answer to this aspect of the appeal, making it destined to fail. [40] With respect to the second aspect of the appeal, in my view, it too is destined to fail.

I say this because of the nature of thematter at stake and the discretionary nature of the order. Bankruptcy and insolvency matters stand apart from other forms of secured debtcollection and are governed by their own standard of review, which accords considerable deference to the Chambers judge.

In 9354-9186Québec inc. v Callidus Capital Corp., 2020 SCC 10, the Supreme Court commented upon the standard of review to apply to the exerciseof discretion by a supervising judge in proceeding under the Companies’ Creditors Arrangement Act, RSC 1985, c C-36 [CCAA]: [53] A high degree of deference is owed to discretionary decisions made by judges supervising CCAA proceedings. As such, appellateintervention will only be justified if the supervising judge erred in principle or exercised their discretion unreasonably (see Grant ForestProducts Inc. v.

Toronto-Dominion Bank, 2015 ONCA 570, 387 D.L.R. (4th) 426, at para. 98; Bridging Finance Inc. v. Béton Brunet 2001inc., 2017 QCCA 138, 44 C.B.R. (6th) 175, at para. 23). Appellate courts must be careful not to substitute their own discretion in place ofthe supervising judge’s (New Skeena Forest Products Inc., Re, 2005 BCCA 192, 39 B.C.L.R. (4th) 338, at para. 20). [54] This deferential standard of review accounts for the fact that supervising judges are steeped in the intricacies of the CCAAproceedings they oversee. In this respect, the comments of Tysoe J.A. in Canadian Metropolitan Properties Corp. v.

Libin Holdings Ltd.,2009 BCCA 40, 305 D.L.R. (4th) 339 (“Re Edgewater Casino Inc.), at para. 20, are apt: [O]ne of the principal functions of the judge supervising the CCAA proceeding is to attempt to balance the interests of the variousstakeholders during the reorganization process, and it will often be inappropriate to consider an exercise of discretion by the supervisingjudge in isolation of other exercises of discretion by the judge in endeavoring to balance the various interests. … CCAA proceedings aredynamic in nature and the supervising judge has intimate knowledge of the reorganization process.

The nature of the proceedings oftenrequires the supervising judge to make quick decisions in complicated circumstances. [41] While this was said in the context of the CCAA, the same principle applies when an appellate court is reviewing the exercise ofdiscretion by a supervising judge in the bankruptcy context.

According to the current practice of the Court of Queen’s Bench, one judgehas carriage of receiverships under the BIA. [42] Thus, the issue becomes whether Harmon’s claim that the Chambers judge erred in principle or exercised his discretionunreasonably when he decided to grant the Order setting the list price of the Millar Avenue Property at $3.8 million rather than theamount suggested by Harmon, i.e., $4.95 million. This is a clear discretionary decision. It is a decision made by a judge who has had thecarriage of this receivership from the outset and who has heard two previous applications.

It is also, as I have indicated, an interlocutorydecision that may or may not have an impact on the final sale price. The application of the standard of review to this decision, made in thiscontext, creates a significant hurdle for Harmon that would not be surmounted if this appeal were permitted to proceed. In my view, suchan appeal is destined to fail. It is for these reasons that I have concluded that leave to appeal should not be granted. VI.

Leave to File Late should not be Granted [43] The applicable provisions from the General Rules are as follows: Appeal to Court of Appeal Appels devant la cour d’appel31(1) An appeal to a court of appeal referred to in subsection 183(2)of the Act must be made by filing a notice of appeal at the office ofthe registrar of the court appealed from, within 10 days after the dayof the order or decision appealed from, or within such further time asa judge of the court of appeal stipulates. 31(1) Un appel est formé devant une cour d’appel visée auparagraphe 183(2) de la Loi par le dépôt d’un avis d’appel au bureaudu registraire du tribunal ayant rendu l’ordonnance ou la décisionportée en appel, dans les 10 jours qui suivent le jour de l’ordonnanceou de la décision, ou dans tel autre délai fixé par un juge de la courd’appel.

(2) If an appeal is brought under paragraph 193(

e) of the Act, thenotice of appeal must include the application for leave to appeal.

(2) En cas d’application de l’alinéa 193e) de la Loi, l’avis d’appel estaccompagné de la demande d’autorisation d’appel.SOR/98-240, s 1 SOR/2007-61, s 63(

E) DORS/98-240, art 1DORS/2007-61, art 63(A) [44] Without an order from a judge of the Court extending the time to appeal under s. 31(1) of the General Rules, the Court hearingan appeal under s. 193 of the BIA has no jurisdiction to hear a late-filed appeal. In this case, the Order issued on June 5, 2020. Harmonserved its notice of appeal on June 11, 2020, but did not file it until July 9, 2020. Thus, Harmon was 24 days late in filing the motion and,without an order extending the time to appeal, there is no appeal. Harmon applied under s. 31(1) of the General Rules to extend the time

for filing. [ 45 ] As previously indicated, it would not be necessary to address this issue in light of my conclusion in relation to the leave issue, but, if I am in error as to whether Harmon has an appeal as of right or whether leave should be granted, I would, nonetheless, dismiss Harmon’s application for an extension of the time to file late. [ 46 ] An applicant seeking to extend the time to appeal must meet a more stringent test than the Rothmans test. Often an appeal is neither frivolous nor vexatious, but it is not possible to say that it is destined to fail.

However, when an applicant for leave must seek an order extending the time to appeal, an appellate Chambers judge is permitted to delve more deeply into the merits and determine whether the appeal is arguable (see Wilkes at para 75 and Houlden, Morawetz & Sarra , generally, at vol 3, M§24). However, in this case, I am satisfied that the appeal is destined to fail, which conclusion also satisfies the question as to whether leave should be granted to file late under s. 31(1) of the General Rules .

An appeal that is destined to fail cannot be considered to be an arguable appeal. [ 47 ] As with all applications, the governing principle in determining whether to grant an extension of time is whether the justice of the case requires that an order should be made (see, generally, Houlden, Morawetz & Sarra at M-24 and the reference to Re Braich , 2007 BCCA 641 at para 10 , 250 BCAC 53). However, it would avail no one if leave to file late were granted in relation to an appeal that is not arguable. VII.

Costs [ 48 ] At one point during these proceedings, when Harmon was unrepresented by counsel, the receiver applied for the appointment of an amicus curiae for Harmon and filed a brief by a lawyer from another law firm. When Harmon successfully obtained counsel, I dismissed the receiver’s amicus application with brief oral reasons. I made no order as to costs. [ 49 ] That brings me to the question of the costs of the applications before me. As the above reasons indicate, I have dismissed the following applications: (

a) Harmon’s application to adduce fresh evidence; (

b) Harmon’s application for a determination that it has an appeal as of right; (

c) Harmon’s application for leave to appeal; and (

d) Harmon’s application to file late. [ 50 ] It seems to me, with respect to the above four applications, that the receiver is entitled to its fees according to the receivership order and therefore costs should not be awarded to it on these applications. Similarly, while the secured creditor was represented on this appeal, and made oral submissions through its counsel, it is not clear to me that the secured creditor is entitled to any costs over and above what its credit facility allows. If the secured creditor is of the contrary view, it may make written submissions to me. VIII. Conclusion [ 51 ] Order to issue in accordance with these reasons. “Jackson J.A.” Jackson J.A.