Electronic Thesis and Dissertation Repository

Thesis Format



Master of Laws




Nocilla, Alfonso


This study examines the monitor, a court-appointed officer under the Companies’ Creditors Arrangement Act, in order to determine whether and how to best secure its independence. Concerns over the role are increasingly over whether it can maintain its supposed impartiality and avoid conflicts of interest. This study centers on its fiduciary duty, long discussed in the courts, as both problematic because it is not conclusively defined, and as the best means of establishing the monitor as a fair and impartial guardian of public confidence in Canadian insolvency law. By examining leading insolvency law theories, international and Canadian insolvency policy, and then the CCAA and insolvency and fiduciary caselaw, this study proposes codification of the monitor’s fiduciary duty. The monitor’s fiduciary duty remains an underexplored concept in the literature, and this study proposes clarification and certainty for that duty through its addition to the CCAA.

Summary for Lay Audience

When large companies find themselves close to being unable to continue paying their creditors, they may consider restructuring their business, usually by selling off parts of it, to return to financial stability. In Canada, the legislation most used for this is the Companies’ Creditors Arrangement Act, 1985 (CCAA). This Act provides the mechanics for a successful restructuring, i.e. for a debtor company to reach a compromise with its creditors under a court’s supervision. It is required that the court appoint a monitor, an officer that acts as impartial information intermediary between all interested parties, advising the debtor company and the court during the restructuring. The monitor is supposed to be independent of the parties, in that it is not supposed to favour any one party. The role is often referred to as that of an impartial watchdog, ensuring the debtor company adheres to what is required of it, and keeping the interested parties and the court updated during the proceedings. Yet the role is often placed in situations where it may have a previous or ongoing relationship with some of the parties, and may act in a way that is perceived as preferring a particular party’s position.

The present study deals with one aspect of the monitor that has not been satisfactorily defined: its fiduciary duty. A fiduciary duty means that one party, the fiduciary, is to act in the best interests of the party to whom it owes the duty, with the utmost diligence, good faith, and loyalty. Since the monitor was first created by courts, it was held to owe a fiduciary duty to all of the parties to the CCAA process. This has never been conclusively determined by the Supreme Court of Canada, or by Parliament. This study seeks not only to clarify whether the monitor is a fiduciary, but to anchor its status as fiduciary by proposing that its fiduciary duty be added to the CCAA. The study argues that inclusion of the monitor’s fiduciary duty in the legislation will protect its independence, clarify its role, and lead to a fairer process.