Overview

• The Bank of Montreal (BMO) sought to appeal an order lifting a stay of proceedings, allowing Unity Health Toronto to terminate its contract with 2442931 Ontario Inc. (ProjectCo).
• The Ontario Court of Appeal ruled that BMO did not have an automatic right of appeal and denied leave to appeal.

Background

• Unity Health awarded a redevelopment contract to ProjectCo in 2015.
• A $230M construction loan was provided by lenders, with BMO as administrative agent.
• ProjectCo defaulted in 2018; the lenders declined to step in to complete the project.
• BMO sought a TIC (Tower Interim Completion) payment, arguing it was owed under the contract.
• In 2022, BMO applied for a declaration that the TIC milestone was met or, alternatively, an assignment of ProjectCo’s rights to enforce the TIC payment.
• The motion judge lifted the stay, allowing Unity Health to terminate the contract, and dismissed BMO’s claim for the TIC payment.

Court of Appeal’s Decision

• No automatic right of appeal: The Lift Stay Order was procedural, did not directly affect the debtor’s property, and did not create an automatic appeal under s. 193(c) BIA.
• Leave to appeal denied: The appeal lacked general legal significance, and overturning the order would delay insolvency proceedings.
• BMO’s loss resulted from its contractual choices, as it declined step-in rights that could have prevented termination?.
• No damages were awarded to either party.