Sears gets go-ahead to liquidate stores

An Ontario Superior Court justice on Friday approved a motion to liquidate all remaining Sears Canada stores, ending a retail empire that served generations of Canadians.

Liquidation sales are scheduled to begin Oct. 19 and finish no later than Jan. 21.

“It is difficult to find the right words at times such as this,” Susan Ursel of Ursel Phillips Fellows Hopkinson, the law firm representing Sears employees, said in court.

“This company has touched the lives of generations of Canadians.”

Ursel asked Justice Glenn Hainey to recognize the work the employees have done and are doing to keep the company going, even though they will be losing their jobs and won’t be getting severance packages to tide them over until they find new work.

“These employees truly deserve the thanks and appreciation of all the shareholders in this proceeding for their past and continuing efforts,” Ursel said.

There are about 12,000 people still working for Sears Canada, after thousands more were let go from head office and in the first wave of store closures.

At its height, Sears Canada employed more than 40,000 people.

“It’s not just the loss of a job for me,” said Blaise Lyle, 58, a former Sears employee who attended the court hearing in downtown Toronto.

Lyle worked for Sears for 39 years. He was let go from his job as an in-store marketing manager at head office on June 22 when the company first sought creditor protection.

Seventy-four full-line department stores remain to be closed, along with eight Sears Home stores and 49 Hometown stores.

Hometown dealers will be permitted to run their own liquidation sales, though they must conform to the same guidelines as the professional liquidators who have been hired to wind down the other stores.

After paying for costs, proceeds from asset sales will be distributed to creditors around the globe.

Outside the courtroom, Andrew Hatnay, a Koskie Minsky lawyer representing Sears pensioners, said his group will move to get their claim paid first, ahead of other creditors — the pension fund is owed more than $260 million.

“The retirees are obviously very concerned with the announcement that the company will be liquidating,” Hatnay said.

A bid by Sears Canada executive chairman Brandon Stranzl to continue operating the company as a going concern has not been successful, but a legal window of opportunity has been left open for Sears to accept an offer up until Oct. 19.

Stranzl contributed his $500,000 retention bonus to an employee hardship fund.

The shutdown of Sears will release 16 million square feet of retail space into the retail real estate market in Canada, two years after Target decamped, leaving 140 properties to fill.