Motor Vehicle Accident Claims Fund

I recently met with a person who owes money to the Motor Vehicle Accident Claims Fund. He was in a car accident, and did not have insurance. The Fund made a payment to the injured party and now the debtor owes money to this Fund. The debtor asked me if this debt would be discharged (go away) in a bankruptcy.

I spoke with someone who works for the claims fund and she advised me that when a claim is made through the fund, the debtor’s driver’s license is suspended, usually until the Fund is repaid. Unfortunately bankruptcy cannot re-instate a driver’s license, so while legally the debt itself may go away in a bankruptcy, you will not get your driver’s license back until the fund is repaid.

If you owe money to the Motor Vehicle Accident Claims Fund, your best option may be to make repayment arrangements with them in order to get your license back as soon as possible. If you have other debts, a bankruptcy or proposal may still make sense, so please contact one of our professionals to review your situation in more detail.

<< Hoyes Michalos and Associates Ontario Personal Bankruptcy Blog