Former Hyndman employees seek to block sale of Celadon’s Canadian properties

Former employees of Hyndman Transport who say they are owed more than C$2 million will begin legal action Wednesday to disrupt U.S. owner Celadon’s efforts to sell off its Canadian assets as part of U.S. bankruptcy proceedings, FreightWaves has learned. 

Andrew J. Hatnay, a Toronto labor lawyer representing 211 ex-employees, plans to ask an Ontario Superior Court judge to begin proceedings to place Hyndman in receivership. Hatnay is taking the step after Celadon’s plans to sell Hyndman’s Ayr, Ontario, headquarters for C$12 million dollars emerged in court filings on Tuesday.

“The goal is to stop the sales of the Canadian properties via the U.S. bankruptcy proceeding and to secure the Canadian assets to pay creditors through a court-supervised process,” Hatnay told FreightWaves in an email. 

Hatnay, a partner with Koskie Minsky, is aiming to initiate a process that otherwise would have happened had Hyndman filed for bankruptcy in Canada.  

Hyndman’s former Canadian employees, estimated to number about 400, could have an easier time securing any unpaid compensation such as severance through a court-appointed receiver. Under Canadian law, employees of bankrupt companies can get preferential standing as unsecured creditors. 

A receivership also would make it possible for former employees and contractors to access federal benefits. 

Canadian suppliers and creditors also could have an interest in pursuing their claims in Canada through a receiver depending on their standing in Celadon’s U.S. Chapter 11 proceedings. But it would muddy the water for Celadon in its U.S. bankruptcy and potentially make it more difficult for its creditors to access the proceeds of any asset sales in Canada.

Hyndman Transport shut down on Dec. 9 after Celadon filed for Chapter 11 protection in the United States. 

A lawyer for Hyndman Transport did not respond to FreightWaves’ request for comment.