Our litigation team achieved a major appellate victory this week.

Shane Coblin and Milaad Hashmi successfully represented the developer and guarantor appellants in a dispute over a $422M construction loan tied to the “Atmosphere” — one of Richmond’s largest proposed developments – a seven-tower residential, office, and commercial project spanning more than a city block.

The decision is reported at GEC (Richmond) GP Inc. v. Romspen Investment Corporation, 2025 BCCA 332.

Background

This case arose from an ambitious $726 million project to build seven residential and commercial towers in Richmond, B.C. To finance the project, the developers entered into a construction loan agreement with Romspen Investment Corporation (“Romspen”), as lender, in November 2019.

The loan provided for a $422 million credit facility, with Romspen committing to fund the initial $212 million itself and to use “commercially reasonable efforts” to syndicate the remaining $210 million by March 31, 2020. All parties knew Romspen could not carry the full loan alone.

Between late 2019 and March 2020, Romspen advanced about $143 million. But when its syndication efforts failed, Romspen sent a letter to the developers on March 31, 2020, advising the developers that it would not advance any further funds, relying upon its own failure to syndicate the balance of $210 million as the justification.  As a result, the developers defaulted under the loan agreement and were forced to seek protection under the Companies’ Creditors Arrangement Act, R.S.C., 1985, c. C-36 (“CCAA”).

Romspen’s refusal to fund triggered a number of law suits between the parties to the loan agreement, and parties to ancillary agreements, including actions brought by Romspen seeking judgment on its alleged outstanding debt; an action brought by the developer and guarantors of the loan agreement seeking damages for Romspen’s breaches of the loan agreement; and an action commenced by GEC (Richmond) GP Inc. and Global Education City (Richmond) Limited Partnership (another lender to the Project) seeking damages against Romspen.

Pursuant to a direction in the CCAA proceedings, the three claims were directed to be heard together on the issue of liability only, with damages to be assessed in a later proceeding.

Trial Judgment

The central question before the trial judge at the liability phase of the trial was whether Romspen was required to fund a minimum of $212 million of the $422 million construction loan even if it did not successfully syndicate the balance ($210 million). Romspen took the position that it was not obligated to fund any portion of the loan, including the initial $212 million, unless it was satisfied that it had syndication commitments for the full $422 million. The appellants took the position that the initial $212 million commitment was not subject to syndication.

In his reasons for judgment, the trial judge found that “Romspen was entitled to cease funding on March 31, 2020, because the Syndication Condition was not met. Romspen was not obliged to provide a minimum of $212 million to the Developers regardless of whether the Syndication Condition was met” (Alderbridge Way GP Ltd. (Re), 2024 BCSC 1433 at para. 189).

Accordingly, the trial judge granted judgment to Romspen and dismissed the appellants claims.

Court of Appeal Reasons

On September 22, 2025, the Court of Appeal issued its reasons and overturned the trial judge’s central finding. The Court of Appeal concluded that the trial judge’s interpretation of the loan agreement failed to give meaning to key terms and was inconsistent with the circumstances known to the parties when they entered into the agreement.

Accordingly, the Court of Appeal held at para. 46 of its reasons that:

“Romspen breached the Loan Agreement when it refused to advance further funding after March 31, 2020, on the basis of the syndication condition.”

The court emphasized that s. 2.02(2)(d) of the loan agreement expressly addressed what would happen if syndication failed. It provided that the borrowers waived Romspen’s obligation to fund any advances “in excess of the portion of the Construction Loan Commitment Amount set out in Schedule B”—namely, $212 million. According to the court, this language only made sense if Romspen’s $212 million commitment remained binding regardless of syndication.

To read the agreement otherwise, the court explained, would render the $212 million “Lender Commitment” redundant.

In the end, the court set aside the trial orders granting Romspen judgment under the loan agreement and found that Romspen breached the loan agreement when it refused to fund beyond March 31, 2020, on the basis of the syndication condition.

The Court of Appeal then remitted the question of damage payable in respect of Romspen’s breach for determination at the damages phase of the trial, so stay tuned for future updates.

Key Takeaways

The Court of Appeal’s reasons underscore an important principle: contracts must be interpreted as a whole and each provision must be given meaning and effect. Courts will avoid interpretations that render key terms superfluous.

In this case, Romspen’s argument would have turned the $212 million “Lender Commitment” into an empty promise. The court rejected that reading.

The ruling also highlights the risks for lenders who seek to suspend funding. If a lender intends to rely on a contractual term to stop advances, it must be certain that the term applies and that its reliance is consistent with the agreement as a whole. A failure to do so can lead to a finding of breach and potentially significant liability on the part of the lender, as this case illustrates.

If you have any questions about this decision or the drafting and interpretation of construction loan agreements, please do not hesitate to contact the authors.

Shane Coblin
scoblin@kornfeldllp.com
604-331-8320

Milaad Hashmi
mhashmi@kornfeldllp.com
604-331-8353

Written by Nils Preshaw
Translations: Pусский, Türkçe, Español, 中国人

I am a lawyer in Vancouver, Canada. In addition to my litigation practice I assist individuals globally with applications for the removal of International Criminal Police Organization (“INTERPOL”) Red Notices.

INTERPOL facilitates global police cooperation and provides support to each of its 196 member countries’ law enforcement agencies to try to combat international crime, including terrorism, cybercrime, and human trafficking. INTERPOL’s General Secretariat coordinates day-to-day activities and is headed up by a Secretary General, currently Mr. Valdecy Urquiza.  INTERPOL is staffed by both police and civilians and is headquartered in Lyon, France.  INTERPOL does not have the power to make arrests.

Each of INTERPOL’s 196 member nations can issue requests from several different types of colour-coded Notices:

https://www.interpol.int/en/Search-Page?search=Notices

The most common type of INTERPOL Notice is the Red Notice, a global request to law enforcement to locate and provisionally arrest a person pending extradition, surrender, or similar legal action.

Red Notices are typically based on an arrest warrant or court order issued by the judicial authorities of the requesting country for an individual accused of committing a “serious ordinary-law crime” such as murder, rape, child abuse or armed robbery. The Red Notice serves to locate the individual for the purposes of extradition. Red Notices typically expire after five years but can be renewed by the requesting nation.

While INTERPOL’s website has a publicly searchable “wanted persons” section, in 2022 only about 7,500 of the approximately 69,000 valid Red Notices were visible to the public. INTERPOL diffusions (discussed below) do not appear on INTERPOL’s website at all.

According to INTERPOL, it published over 15,500 Red Notices in 2024:

https://www.interpol.int/en/How-we-work/Notices/About-Notices

Article 83 of INTEPOL’s Rules on the Processing of Data sets out specific conditions for the publication of Red Notices. They are not supposed to be published for allegations or convictions relating to:

• behavioural or cultural norms. For example, prostitution or offences related to damaging honour;

• offences relating to family/private matters. For example, adultery, bigamy/polygamy or homosexual acts;

• offences originating from a violation of laws or regulations of an administrative nature or deriving from private disputes, unless the criminal activity is aimed at facilitating a serious crime or is suspected of being connected to organized crime. For example, traffic violations, defamation, or issuing unfunded cheques (unless there was a fraudulent or malicious intent at the time the cheque was issued); and

• Article 3 of INTERPOL’s Constitution strictly forbids INTERPOL from undertaking any intervention or activities of a political character. 

Despite these requirements, I am regularly contacted by individuals seeking to have their Red Notices deleted as they claim the Notice has been improperly issued.

Other commonly seen Notices

In addition to Red Notices there are also:

• Blue Notices: published to collect additional information about a person’s identity, location, or activities in relation to a criminal investigation.

In a recent decision by INTERPOL’s Commission for the Control of INTERPOL’s Files (2025 – Decision Excerpt N°4) an individual applied to the Commission to delete a Blue Notice and all data related to him as he had been mistakenly identified. The Blue Notice had been requested in order to locate the individual and notify him that he was facing narcotics charges in the member nation.

A witness identified the individual as the person who had threatened him and tried to force him to transport narcotics.

Ultimately INTERPOL refused to delete the Blue Notice, finding instead that the requesting nation had complied with INTERPOL’s rules and the individual could return to contest the allegations in court;

• Green Notices: which warn about the criminal activities of individuals who are considered a possible threat to public safety.

In a recent decision (2025 – Decision Excerpt N°3) an individual applied to the Commission to delete a Green Notice, and all data related to him as he claimed the Notice lacked proportionality between the impact of the data processed and the purpose for which it was processed.

The Green Notice had been requested as the member nation alleged that the individual was involved in narcotics, forgery and theft and as such was a possible threat to public safety globally.

The individual had six prior convictions and had last been arrested for robbery in 2015.

Ultimately INTERPOL’s Commission decided that the Green Notice should be deleted within 30 days unless the requesting nation could show that retention of the Notice was authorized under its own laws;

• Silver Notices:a pilot programrecently created by INTERPOL with approximately fifty participating countries. Silver Notices are intended to identify and trace assets alleged to have been obtained through crime.

In January 2025 INTERPOL published its first ever Silver Notice. The Notice was requested by Italy and sought information on assets belonging to a senior member of the Italian Mafia.

By the end of June 2025, over 50 Silver Notices have been issued globally, and I expect many more will follow.

INTERPOL Diffusions

Unlike a Notice, a Diffusion is an informal request to cooperate and share information between INTERPOL member countries. Unlike a Red Notice, a diffusion can be circulated by a member country directly to other specific countries or to the entire INTERPOL membership.

Diffusions correspond to INTERPOL’s colour-coded system, so red, blue, green, and silver diffusions exist, and all must comply with INTERPOL’s Constitution and the Rules on the Processing of Data.

According to Mr. Ted Bromund’s July 2025 Policy Report (How the Abuse of Interpol Contributes to Transnational Repression), in 2023 INTERPOL member nations transmitted 11,709 Red Notice Diffusions.

Alleged Abuse of INTERPOL’s Notice System

There have been numerous allegations of abuse of the Notice system:

• China, Russia and Venezuela have all been accused of regularly deploying Red Notices to pursue and harass dissidents who have fled persecution;

Russia repeatedly requested a Red Notice for Bill Browder, the American CEO of Hermitage Capital Management. INTERPOL refused to do so on the basis that the Notice was impermissible as it was predominantly political in nature. Browder was subsequently tried and convicted by a Moscow court for tax evasion in absentia and went on to publish a book about his experiences, entitled “Red Notice: A True Story of High Finance, Murder, and One Man’s Fight for Justice”.

• In June 2020, Iran issued arrest warrants for Donald Trump and thirty-five other U.S. political and military officials for their alleged role in the assassination of Qasem Soleimani and requested INTERPOL to issue Red Notices;
• Authoritarian governments in the Middle East (and other regions) have been accused of improperly requesting Red Notices for matters of an administrative nature (for example, allegations of civil debt, missed mortgage payments or even simply a bounced cheque) or matters deriving from private disputes (for example, civil litigation matters);
• Red Notices have also been improperly requested for individuals who have publicly criticized their own authoritarian governments, or for political dissidents, human rights defenders and even journalists, with nations claiming the individuals are wanted for common crimes like corruption or financial misconduct;
• In 2022, INTERPOL rejected India’s request for a Red Notice for the founder of a Sikh secessionist group, Mr. Gurpatwant Singh Pannum, as it had a political character;
• According to the Red Notice Monitor, if an individual says anything against the Erdoğan Government of Turkey they will be immediately imprisoned.  The Monitor goes on to allege that whenever a journalist or activist who is outside of Türkiye’s borders criticizes the president/government, Türkiye will request a Red Notice;
• The Philippines has been accused of improperly requesting a Red Notice arising from a family law dispute;
• In 2021, a Chinese businessman (who has been identified only as “H”) was detained in France pursuant to a Red Notice requested by China.  H was awaiting a French extradition hearing when he allegedly received a telephone call from Chinese billionaire and founder of the Alibaba website, Jack Ma pressuring H to voluntarily return to China;
• In 2012, Japan requested a Red Notice for Paul Watson, an anti-whaling pioneer. Watson was wanted in Japan following an alleged boarding of a Japanese whaling ship, the “Shōnan Maru 2” in February 2010 and the use of “stink bombs”. The charges, including one of assault, carried a maximum sentence of up to 15 years in jail.

Watson was arrested in Greenland in July 2024 pursuant to the Red Notice but was released after five months after Denmark failed to receive sufficient assurance that Watson’s time in custody would be deducted from any future Japanese sentence.  

In July 2025, INTERPOL deleted Watson’s Red Notice. In a statement, Watson’s lawyer said that the Notice did not meet INTERPOL’s standards, citing the disproportionate nature of the charges, the considerable passage of time since the alleged incident, Denmark’s refusal to extradite him and the fact that several other countries declined to act on Japan’s arrest or extradition requests.

Despite the above, there is still an active Japanese arrest warrant for Watson.

Scandals at INTERPOL

INTERPOL is not immune from internal scandals:

• In June 2015 INTERPOL suspended a sports integrity agreement with the Fédération Internationale de Football Association (“FIFA”) following allegations of corruption;
• Former INTERPOL Chief, and citizen of China, Mr. Meng Hongwei, was sentenced to 13 ½ years for bribery in January 2020;
• In November 2021,  Major General Ahmed Naser Al-Raisi  of the United Arab Emirates was elected to a four year term as INTERPOL’s President despite allegations he was responsible for the torture and arbitrary detention of individuals in the UAE .  The UAE has strongly rejected the accusations; and   
•  
• More recently Vitalie Pirlog, a former Moldovian Justice Minister and subsequent chair of a Commission that controls INTERPOL’s files, was arrested on allegations that he had accepted bribes and assisted individuals facing Red Notices to obtain asylum-seeker status in Moldova (Interpol does not allow red notices against officially registered asylum seekers);

Consequences of a Red Notice or Diffusion

According to Mr. Bromund, being named in a public Red Notice can lead banks to close an individual’s accounts and destroy their financial well-being. 

If an individual is unfortunate enough to be arrested on a Red Notice in a country with less than stringent (or sometimes nonexistent) extradition procedures, they can end up being swiftly transported to the requesting country without a review of the legality of the allegations that led to the Notice.

If an individual is returned to an authoritarian country that does not abide by basic human rights or the rule of law, outcomes can include unjust imprisonment and even torture.

Red Notices are often based on nothing more than the word of the requesting nation. The ensuing extradition process can be lengthy and expensive and can serve to both punish the individual and deter potential opponents of abusive governments.

An individual with a Red Notice or other INTERPOL alert will likely be detained while crossing any international border and referred for secondary inspection.  Such individuals are often denied entry and, if particularly unlucky, can end up being transported to the requesting nation to face that nation’s justice system. As you can imagine, improperly requested Red Notices can lead to serious outcomes.

Alleged Abuse of INTERPOL’s System

It is not difficult to see how an improperly requested Red Notice can cause havoc.

Many hotels around the globe now scan passports on check-in, effectively restricting the movement of anyone named in an INTERPOL Notice.

INTERPOL member nations can also apparently report passport numbers that have been “compromised” through theft or carelessness. A disreputable nation can also report a passport as stolen or lost, or revoke a passport it has previously issued, leaving the individual suddenly stateless and trapping them in whatever airport they happen to be in.

The most well-known example of this kind of abuse was Türkiye’s cancellation of the passport of NBA basketball player, Enes Kanter, in May 2017. Kanter, a Turkish national, had made public statements against the Turkish government and, while passing through Romania, ended up being trapped after Türkiye cancelled his passport.

Being prevented from traveling internationally (or even domestically) is the harsh reality for individuals facing improperly requested INTERPOL notices.

While U.S. and European courts have refused to extradite individuals merely on the basis that they have been named in INTERPOL Notices, little has been done to prevent improper requests (although INTERPOL now claims that requests for Red Notices are reviewed for compliance by a Notices and Diffusions Task Force).  INTERPOL admits that member countries are primarily responsible for ensuring their requests comply with INTERPOL rules, national laws and international obligations.

How to Remove INTERPOL Red Notice

Individuals seeking to challenge an improperly issued Red Notice face what can be a long and expensive legal undertaking.

While an application to the Commission for the Control of INTERPOL’s files can sometimes lead to the deletion of a Red Notice and all related data. INTERPOL does not yet have a mechanism to award monetary damages for improperly requested Notices.

INTERPOL does not move quickly. It typically takes over 4 months for INTERPOL to simply confirm whether or not an individual has been named in a Red Notice at all.

It can take even longer to gain access to the underlying investigative documents of the requesting country, and it is not unusual for nations to refuse to provide them and instead provide only a brief summary of their allegations.

INTERPOL’s Commission is tasked only with ensuring that Notices comply with its rules and regulations. The Commission, which typically meets only four times a year, does not consider the legality of foreign allegations/any conviction that led to a Red Notice request. but instead considers only whether a Notice complies with INTERPOL’s legislation.

Given the sheer number of Notices, it often takes the Commission more than the 9-month time limit stipulated in INTERPOL’s own rules and regulations to issue a decision. Decisions by the Commission cannot usually be appealed.

Over the past six years, I have assisted many clients with applications to delete improperly requested Red Notices. I commonly see Notices that are based on family disputes, civil law/administrative matters or that have an impermissible political character. In my experience INTERPOL continues to publish Red Notices unrelated to any serious ordinary-law crime and/or where the location of the individual/target is already known to the requesting nation.

If you are facing an INTERPOL issue, please feel free to contact me.

Nils Preshaw is a lawyer based in Vancouver, Canada whose regularly advises and assists clients regarding Notices which may have been issued by INTERPOL or requested by its member countries. Mr. Preshaw can be reached at npreshaw@kornfeldllp.com or by telephone at +1 (604) 331-8300.