Wed Aug 27, 2008 4:36 PM ET
By Randall Palmer
OTTAWA, Aug 27 (Reuters) - Both sides involved in a dispute over a
restructuring plan for asset-based commercial paper (ABCP) asked the
Supreme Court of Canada on Wednesday to expedite any hearings it might
hold on the matter.
"We're seeking a hearing by the end of September," said Howard Shapray,
a lawyer for Ivanhoe Mines <IVN.TO>, which is opposing the plan to
restructure the market, which was worth C$32 billion ($30 billion)
before trading stalled last summer.
Those challenging the plan expect to file an application with the top
court on Tuesday asking for permission to appeal. The opposing side, the
investors committee that drafted the plan, agreed that if the Supreme
Court hears the appeal it should be dispatched quickly.
The investors committee would still appear to have the right to ask the
Supreme Court not to hear the appeal, but it is clear that both sides
want the issue cleared up as quickly as possible so funds can be
The plan would replace investors' current short-term notes with
longer-term notes that mature in up to nine years. The value of the new
notes in any secondary market is uncertain.
Ivanhoe and other Canadian companies that own the affected commercial
paper have argued for months that the ABCP plan illegally takes away
their right to sue banks and brokerages that sold them the paper.
But the Ontario Court of Appeal this month upheld a lower court ruling
from June that said the plan could go ahead.
Until it is resolved, other investors face delays in recovering money
from the restructuring plan, which was developed over the past year.
The market for this commercial paper -- asset-backed notes that were
issued by third-party trusts, not by the country's big banks -- seized
up in August 2007 on credit concerns, freezing investors' funds.
Most of about 2,000 retail investors who own the ABCP are eligible for
special repurchase programs.
It can normally take months before the Supreme Court hears cases, from
the time permission to appeal is sought, and further months to decide.
However, in another high-profile commercial situation two months ago,
involving the planned leveraged buyout of BCE Inc <BCE.TO>, the court
dealt with the whole case from start to finish within one month.
Randall Palmer; editing by Rob Wilson)