Law360 Canada ( July 25, 2025, 1:15 PM EDT) -- Appeal by appellant from the decision regarding the payments made by Specialty Chemical Industries Inc. (Specialty) to the respondent, which were claimed to be preferential payments under the Bankruptcy and Insolvency Act (BIA). Specialty, a bulk chemical purchasing broker, made payments totalling US$400,000 to the respondent, one of its major suppliers, slightly more than a month before Specialty filed for bankruptcy. Specialty was insolvent at the time of these payments, which had the effect of giving the respondent a preference over other unpaid creditors. Specialty’s trustee in bankruptcy initially failed to recover the payments from the respondent, as the bankruptcy judge found that Specialty’s intention was to maintain its business relationship with its only customer, Autoliv ASP, Inc., rather than to prefer the respondent over other creditors. The appellant argued that the bankruptcy judge erred in considering evidence of pressure on Specialty to make the payments, as the BIA prohibited such evidence from being used to support a transaction. Additionally, the appellant contended that the bankruptcy judge incorrectly concluded that Specialty’s intention to preserve its customer relationship was sufficient to rebut the presumption of preference, as there was no reasonable basis for Specialty’s business continuation plan....