Amendments address concerns
stemming from Kennedy Electric

Lien
Continued From Page 10

no liens are “sheltering” behind the certificate of action. This requirement has caused concern among practitioners, because they have been required to serve as “judge and jury” on whether a particular lien can shelter.

Under the new amendment, a
lien claimant whose lien is shel-
tered under a certificate of action
that has been vacated by court
order will still be able to proceed
with an action to enforce its shel-
tered lien, as if the order to vacate
had not been made. This will
allow lawyers to vacate certifi-
cates of action without the need
to make the sheltering statement.

Roger Gillott is a partner in the Construction and Infrastructure Group at Osler Hoskin & Harcourt LLP in Toronto, where he practises construction and procurement law.

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Sale of a Business, 8th Edition

Jennifer E. Babe, B. A., LL.B., LL.M.

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The Road Map for Sale and Purchase of a Business

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Tenant must satisfy lender and landlord Lender’s concerns

Landlord’s concerns
n;Excluding from the lender’s
security interest any of the ten-
ant’s personal property forming
part of the leased premises’ lease-
hold improvements;
n;Providing a postponement of
the landlord’s right of distraint in
favour of the lender rather than a
waiver so as to preserve the land-
lord’s right to seize the balance of
any remaining proceeds to apply
to rent arrears, if any;
n;Limiting the landlord’s covenant
to provide the lender notice of
tenant defaults pursuant to the
terms of the lease;
n;In the event of default, (i) dis-
claiming any obligation of the
landlord to safeguard the secured
property so that the storage is at
the lender’s sole risk, (ii) col-
lecting occupation rent from the
lender for the period of time the
tenant’s personal property is
stored on the leased premises,
(iii) limiting the lender’s access to
the leased premises to seize the
tenant’s personal property to a
specific time frame, and (iv)
obtaining the lender’s commit-
ment to repair any damage
caused by the removal of the ten-
ant’s personal property.

Josée Virgo is an associate in the Ottawa office of Borden Ladner Gervais LLP. She is a member of the firm’s Commercial Real Estate Group and focuses in the development, purchase, sale, leasing and financing of commercial properties.