McInnes Cooper's Hugh Wright in International Pension Lawyer: Indalex - Navigating the Shoals of Conflict of Interest
February 6, 2014
By Hugh Wright, at McInnes Cooper
Insolvent companies who administer defined benefit pension plans face unique legal challenges in reconciling competing duties to the beneficiaries of the pension plans and the stakeholders of the company. A recent decision of the Supreme Court of Canada provides some guidance on how competing interests may be reconciled. The Court’s decision on the issue of the priorities in insolvency proceedings in Canada partly restored the prior understanding regarding the priority of lenders during insolvent restructuring proceedings. However, the Court’s decision has created uncertainty for lenders to companies that sponsor pension plans. Ultimately, it is the Court’s commentary on potential conflict of interests arising between pension plan sponsors and pension plan administrators that will likely have the greatest ongoing impact on future pension plan administration and litigation.
Click here to read “Indalex – Navigating the Shoals of Conflict” as seen in International Pension Lawyer, Volume 79 – October 2013.
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