An administrator of consumer proposals is a trustee in bankruptcy or a person appointed by the Superintendent of Bankruptcy to administer consumer proposals. The Provinces of British Columbia (1-800-663-7867), Saskatchewan (1-306-933-6520), Nova Scotia (1-902-424-7020) and Prince Edward Island (1-902-368-4580) provide this service. You may wish to contact the appropriate provincial department. With regard to bankruptcy trustees in Ontario and other parts of Canada, their names may usually be found in the yellow pages of your telephone book under the headings of "Bankruptcy" or "Trustees in Bankruptcy".
In a personal bankruptcy in Ontario, you must assign all your assets to the trustee, except for exempt property (such as basic furniture, tools-of-trade and, under certain circumstances, the goods and services tax credit payments). Exempt property will vary from province to province. Your trustee can tell you what bankruptcy exemptions in Ontario are.
This is the legal status of a person who declares bankruptcy.
This is the federal law which regulates filing bankruptcy and personal bankruptcy process, and filing and processing consumer proposals in Canada. It falls under the responsibility of the Office of the Superintendent of Bankruptcy at Industry Canada.
This is a court in which a judge or registrar will decide on the bankrupt's application for bankruptcy discharge and other insolvency matters.
Your bankruptcy does not cancel the responsibility of anyone who has guaranteed or co-signed a loan on your behalf. For example, if your parent co-signed a loan for you, that parent would be liable to pay the loan in full even if you decide to file for bankruptcy.
A creditor is a person, institution or business to whom money is owed. Secured creditors are creditors who have taken some measure to protect themselves and hold a mortgage, pledge, lien or similar instrument on, or against, your property. If they are not paid, they can enforce their claims by recovering the assets on which they hold security.
Unsecured creditors are creditors who do not have any security for the debt owned to them.
Credit bureaus, or credit reporting agencies, collect information about consumers' financial affairs and sell the information to their clients, such as credit grantors, employers, and insurance companies. These agencies obtain information from various sources, for example:
It should be noted that your credit rating is set by your creditors. Credit bureaus only pass on that information to their clients.
Generally, information concerning your bankruptcy could show up on your credit report for a period of 6 to 7 years after your discharge. If you have been bankrupt before, this period could be extended to as much as 14 years. This period could vary from one province to another.
The decision as to whether or not to grant credit to an applicant is made by the credit grantor, not the credit bureau. It is the lender's individual credit scoring system that determines access to credit.
Should you wish to repair your credit record after obtaining your discharge from bankruptcy, you could, for instance, contact your banker and request a meeting. For this meeting, you could bring your pay cheque stubs, your personal budget, and your discharge papers. You could explain that you have obtained your discharge and ask the banker how you can earn your way back to a good credit record.
A debtor is a person who receives a loan or an advance of goods and services in exchange for a promise to pay at a later date.
Two income tax returns must be completed for the calendar year in which you become bankrupt. The pre-bankruptcy return covers the period from the beginning of the year to the date of your bankruptcy. You will be required to provide your trustee with details and documentation to support this return. The post-bankruptcy return covers the period from the date of bankruptcy to the end of the calendar year.
The trustee may ask you to give all, or a portion of, any possible income tax refund for distribution to your creditors.
Inspectors are appointed by creditors to represent them before the trustee during the administration of consumer proposals and bankruptcies. They are expected to assist the trustee by virtue of their experience and are required to supervise certain aspects of the trustee's administration.
A person who is unable to meet financial obligations as they become due is insolvent.
Although legal actions or most garnishments against you stop on the date you file bankruptcy or file a consumer proposal, criminal actions and some civil matters, such as actions in matrimonial matters, are not affected by the bankruptcy or proposal. Give the trustee or administrator copies of all legal documents that you have received before and after the date you became bankrupt or filed a proposal. In a proposal, no creditor can, without permission of the court, start or continue any legal action until the proposal is either withdrawn, refused, annulled or until the administrator has been discharged. In the case of a bankruptcy, no creditor may, without permission of the court, start or continue any legal action until the trustee has been discharged.
Mediation is a way of resolving conflict between two or more individuals. In the course of a bankruptcy, the parties involved in a disagreement can agree to work with an impartial and independent person, called a "mediator", who will help them settle their dispute instead of going to court. Generally, the mediator is an employee from one of the Superintendent of Bankruptcy's Division Offices. Mediation is more flexible, speedier and less costly than a formal court decision. It allows people affected by the bankruptcy to be directly involved in deciding how their disagreement will be settled. In bankruptcy, mediation is available to resolve two types of disputes:
When mediation takes place, the bankrupt and the trustee (or trustee's representative) must be present. If a creditor requests mediation, that creditor must also be present.
For more information on mediation, you may ask your trustee to provide you with a free copy of the folder entitled "All About Bankruptcy Mediation" prepared by the Office of the Superintendent of Bankruptcy.
The Official Receiver is a federal government employee in the Office of the Superintendent of Bankruptcy and an officer of the court with specific duties under the Bankruptcy and Insolvency Act. The Official Receiver, among other things, accepts the documents that are filed in proposals to creditors and personal bankruptcy processes, examines bankrupts under oath and chairs meetings of creditors.
One of the objectives of the Bankruptcy and Insolvency Act is to relieve you of pressure from your creditors. If you receive phone calls or letters from creditors, tell them that you are bankrupt, or have made a proposal, and refer them to your trustee or administrator.
The Superintendent of Bankruptcy is a federally appointed official who oversees the administration of the Bankruptcy and Insolvency Act in Canada.
Immediately after becoming bankrupt, you should no longer be required to make payments to your creditors. However, while you are an undischarged bankrupt, you are required to make payments to your trustee for distribution to your creditors. Remember, you have a duty to inform your trustee of any material change in your financial situation (for example: an income tax refund, a new job, or the birth of a new family member). At the beginning of the personal bankruptcy process, the trustee determines the amount that you will be required to pay. This amount may be adjusted during the administration of your Ontario bankruptcy if there is a change in either your total income or personal or family situation. The trustee sets the amount of payment by taking into account your total income, the standards issued by the Superintendent of Bankruptcy, and your personal and family situation. The Superintendent of Bankruptcy's standards are set out in Directive #11.
If your payments (known as the Surplus Income Payments) are set at $50 or more per month and you do not agree with the amount set by the trustee, the trustee must request mediation. Similarly, a creditor may request mediation if that creditor does not agree with the amount of the Surplus Income Payment set by the trustee. If mediation does not resolve the disagreement, the trustee, under certain circumstances, will have to apply to court to have the matter decided.
Failure to make the required payments may affect your bankruptcy discharge.
A trustee in bankruptcy is a person licensed by the Superintendent of Bankruptcy to administer consumer proposals and personal bankruptcy processes. The trustee represents your creditors and is an officer of the court. However, the trustee can give you information and advice about both the proposal and bankruptcy processes and make sure that your rights, as well as those of the creditors, are respected.
You must give all windfalls, such as lottery winnings and inheritances, occurring during the period of your bankruptcy, to the trustee for distribution to your creditors.